Exhibit 4.5
ARIZONA PUBLIC SERVICE COMPANY
TO
THE BANK OF NEW YORK
Trustee
--------------
Indenture
Dated as of November 15, 1996
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(For Senior Notes)
..............................................................
Certain Sections of this Indenture relating to Sections 310 through 318,
inclusive, of the Trust Indenture Act of 1939:
Trust Indenture
Act Section Indenture Section
ss. 310 (a) (1) ......................................... 709
(a) (2) ......................................... 709
(a) (3) ......................................... Not Applicable
(a) (4) ......................................... Not Applicable
(b) ......................................... 708
710
ss. 311 (a) ......................................... 713
(b) ......................................... 713
ss. 312 (a) ......................................... 801
802
(b) ......................................... 802
(c) ......................................... 802
ss. 313 (a) ......................................... 803
(b) ......................................... 803
(c) ......................................... 803
(d) ......................................... 803
ss. 314 (a) ......................................... 804
(a) (4) ......................................... 101
1104
(b) ......................................... 1105
(c) (1) ......................................... 102
(c) (2) ......................................... 102
(c) (3) ......................................... Not Applicable
(d) ......................................... 102
......................................... 404
(e) ......................................... 102
ss. 315 (a) ......................................... 701
(b) ......................................... 702
(c) ......................................... 701
(d) ......................................... 701
(e) ......................................... 614
ss. 316 (a) ......................................... 101
(a) (1)(A) ......................................... 602
612
(a) (1)(B) ......................................... 613
(a) (2) ......................................... Not Applicable
(b) ......................................... 608
(c) ......................................... 104
ss. 317 (a) (1) ......................................... 603
(a) (2) ......................................... 604
(b) ......................................... 1103
ss. 318 (a) ......................................... 107
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NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.
TABLE OF CONTENTS
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PAGE
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PARTIES
RECITALS OF THE COMPANY
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions:
Act................................................................................. 2
Affiliate........................................................................... 2
Authenticating Agent................................................................ 2
Board of Directors.................................................................. 2
Board Resolution.................................................................... 2
Business Day........................................................................ 2
Commission.......................................................................... 2
Company............................................................................. 2
Company Request; Company Order...................................................... 2
Corporate Trust Office.............................................................. 2
Corporation......................................................................... 2
Covenant Defeasance................................................................. 3
Defaulted Interest.................................................................. 3
Defeasance.......................................................................... 3
Depositary.......................................................................... 3
Event of Default.................................................................... 3
Exchange Act........................................................................ 3
Expiration Date..................................................................... 3
Expert.............................................................................. 3
First Mortgage..................................................................... 3
First Mortgage Bonds................................................................ 3
Global Note......................................................................... 3
Holder.............................................................................. 3
Indenture........................................................................... 3
Interest............................................................................ 3
Interest Payment Date............................................................... 3
Investment Company Act.............................................................. 4
Maturity............................................................................ 4
Mortgage Trustee.................................................................... 4
Notes............................................................................... 4
Note Register; Note Registrar....................................................... 4
Notice of Default................................................................... 4
Officers' Certificate............................................................... 4
Opinion of Counsel.................................................................. 4
Original Issue Discount Note........................................................ 4
Outstanding......................................................................... 4
Paying Agent........................................................................ 5
Person.............................................................................. 5
Place of Payment.................................................................... 5
Predecessor Note.................................................................... 5
Redemption Date..................................................................... 5
Redemption Price.................................................................... 6
Regular Record Date................................................................. 6
Release Date........................................................................ 6
Responsible Officer................................................................. 6
Securities Act...................................................................... 6
Senior Note First Mortgage Bonds.................................................... 6
Special Record Date................................................................. 6
Stated Maturity..................................................................... 6
Subsidiary.......................................................................... 6
Trust Indenture Act................................................................. 6
Trustee............................................................................. 6
U.S. Government Obligation.......................................................... 7
Vice President...................................................................... 7
SECTION 102. Compliance Certificates and Opinions..................................................... 7
SECTION 103. Form of Documents Delivered to Trustee................................................... 7
SECTION 104. Acts of Holders; Record Dates............................................................ 8
SECTION 105. Notices, Etc., to Trustee and Company.................................................... 10
SECTION 106. Notice to Holders; Waiver................................................................ 10
SECTION 107. Conflict with Trust Indenture Act........................................................ 11
SECTION 108. Effect of Headings and Table of Contents................................................. 11
SECTION 109. Successors and Assigns................................................................... 11
SECTION 110. Separability Clause...................................................................... 11
SECTION 111. Benefits of Indenture.................................................................... 11
SECTION 112. Governing Law............................................................................ 11
SECTION 113. Legal Holidays 12
ARTICLE TWO
NOTE FORMS
SECTION 201. Forms Generally.......................................................................... 12
SECTION 202. Form of Face of Note..................................................................... 12
SECTION 203. Form of Reverse of Note.................................................................. 14
SECTION 204. Form of Legend for Global Notes.......................................................... 18
SECTION 205. Form of Trustee's Certificate of Authentication.......................................... 19
ARTICLE THREE
THE NOTES
SECTION 301. Amount Unlimited; Issuable in Series..................................................... 19
SECTION 302. Denominations............................................................................ 22
SECTION 303. Execution, Authentication, Delivery and Dating........................................... 22
SECTION 304. Temporary Notes.......................................................................... 24
SECTION 305. Registration, Registration of Transfer and Exchange...................................... 24
SECTION 306. Mutilated, Destroyed, Lost and Stolen Notes.............................................. 26
SECTION 307. Payment of Interest; Interest Rights Preserved........................................... 26
SECTION 308. Persons Deemed Owners.................................................................... 27
SECTION 309. Cancellation............................................................................. 28
SECTION 310. Computation of Interest.................................................................. 28
SECTION 311. CUSIP Numbers 28
SECTION 312. Payments on Senior Note First Mortgage Bonds............................................. 28
ARTICLE FOUR
SENIOR NOTE FIRST MORTGAGE BONDS
SECTION 401. Acceptance of Senior Note First Mortgage Bonds........................................... 29
SECTION 402. Terms of Senior Note First Mortgage Bonds................................................ 29
SECTION 403. Senior Note First Mortgage bonds as Security for Notes................................... 29
SECTION 404. Fair Value Certificate................................................................... 30
SECTION 405. Senior Note First Mortgage Bonds Held by the Trustee..................................... 31
SECTION 406. No Transfer of Senior Note First Mortgage bonds; Exception............................... 31
SECTION 407. Delivery to the Company of all Senior Note First Mortgage bonds.......................... 31
SECTION 408. Further Assurances....................................................................... 32
SECTION 409. Exchange and Surrender of Senior Note First Mortgage bonds............................... 32
ARTICLE FIVE
SATISFACTION AND DISCHARGE
SECTION 501. Satisfaction and Discharge of Indenture.................................................. 33
SECTION 502. Application of Trust Money............................................................... 34
ARTICLE SIX
REMEDIES
SECTION 601. Events of Default........................................................................ 34
SECTION 602. Acceleration of Maturity; Rescission and Annulment....................................... 36
SECTION 603. Collection of Indebtedness and Suits for
Enforcement by Trustee.......................................................... 37
SECTION 604. Trustee May File Proofs of Claim......................................................... 37
SECTION 605. Trustee May Enforce Claims Without Possession
of Notes........................................................................ 38
SECTION 606. Application of Money Collected........................................................... 38
SECTION 607. Limitation on Suits...................................................................... 38
SECTION 608. Unconditional Right of Holders to Receive Principal,
Premium and Interest............................................................ 39
SECTION 609. Restoration of Rights and Remedies....................................................... 39
SECTION 610. Rights and Remedies Cumulative........................................................... 40
SECTION 611. Delay or Omission Not Waiver............................................................. 40
SECTION 612. Control by Holders....................................................................... 40
SECTION 613. Waiver of Past Defaults.................................................................. 40
SECTION 614. Undertaking for Costs.................................................................... 41
SECTION 615. Waiver of Usury, Stay or Extension Laws.................................................. 41
ARTICLE SEVEN
THE TRUSTEE
SECTION 701. Certain Duties and Responsibilities...................................................... 41
SECTION 702. Notice of Defaults....................................................................... 42
SECTION 703. Certain Rights of Trustee................................................................ 42
SECTION 704. Not Responsible for Recitals or Issuance of Notes........................................ 43
SECTION 705. May Hold Notes........................................................................... 43
SECTION 706. Money Held in Trust...................................................................... 43
SECTION 707. Compensation and Reimbursement........................................................... 44
SECTION 708. Conflicting Interests.................................................................... 44
SECTION 709. Corporate Trustee Required; Eligibility.................................................. 45
SECTION 710. Resignation and Removal; Appointment of Successor........................................ 45
SECTION 711. Acceptance of Appointment by Successor................................................... 46
SECTION 712. Merger, Conversion, Consolidation or Succession
to Business.................................................................... 47
SECTION 713. Preferential Collection of Claims Against Company........................................ 48
SECTION 714. Appointment of Authenticating Agent...................................................... 48
ARTICLE EIGHT
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 801. Company to Furnish Trustee Names and Addresses
of Holders...................................................................... 50
SECTION 802. Preservation of Information; Communications
to Holders...................................................................... 50
SECTION 803. Reports by Trustee....................................................................... 50
SECTION 804. Reports by Company....................................................................... 51
ARTICLE NINE
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 901. Company May Consolidate, Etc., Only on
Certain Terms.................................................................. 51
SECTION 902. Successor Substituted.................................................................... 52
ARTICLE TEN
SUPPLEMENTAL INDENTURES
SECTION 1001. Supplemental Indentures Without Consent of Holders...................................... 53
SECTION 1002. Supplemental Indentures With Consent of Holders......................................... 54
SECTION 1003. Execution of Supplemental Indentures.................................................... 55
SECTION 1004. Effect of Supplemental Indentures....................................................... 55
SECTION 1005. Conformity with Trust Indenture Act..................................................... 55
SECTION 1006. Reference in Securities to Supplemental Indentures...................................... 55
ARTICLE ELEVEN
COVENANTS
SECTION 1101. Payment of Principal, Premium and Interest.............................................. 56
SECTION 1102. Maintenance of Office or Agency......................................................... 56
SECTION 1103. Money for Notes Payments to Be Held in Trust............................................ 56
SECTION 1104. Statement by Officers as to Default..................................................... 57
SECTION 1105. Recording, Filing, etc.; Opinions of Counsel............................................ 58
SECTION 1106. Existence............................................................................... 58
SECTION 1107. Maintenance of Properties............................................................... 59
SECTION 1108. Payment of Taxes and Other Claims....................................................... 59
SECTION 1109. Waiver of Certain Covenants............................................................. 59
SECTION 1110. Calculation of Original Issue Discount.................................................. 59
ARTICLE TWELVE
REDEMPTION OF NOTES
SECTION 1201. Applicability of Article................................................................ 60
SECTION 1202. Election to Redeem; Notice to Trustee................................................... 60
SECTION 1203. Selection by Trustee of Notes to Be Redeemed............................................ 60
SECTION 1204. Notice of Redemption.................................................................... 61
SECTION 1205. Deposit of Redemption Price............................................................. 62
SECTION 1206. Notes Payable on Redemption Date........................................................ 62
SECTION 1207. Notes Redeemed in Part.................................................................. 62
ARTICLE THIRTEEN
SINKING FUNDS
SECTION 1301. Applicability of Article................................................................ 63
SECTION 1302. Satisfaction of Sinking Fund Payments with Notes........................................ 63
SECTION 1303. Redemption of Notes for Sinking Fund.................................................... 63
ARTICLE FOURTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1401. Company's Option to Effect Defeasance or
Covenant Defeasance............................................................. 64
SECTION 1402. Defeasance and Discharge................................................................ 64
SECTION 1403. Covenant Defeasance..................................................................... 65
SECTION 1404. Conditions to Defeasance or Covenant Defeasance......................................... 65
SECTION 1405. Deposited Money and U.S. Government Obligations
to Be Held in Trust; Miscellaneous Provisions...................................... 67
SECTION 1406. Reinstatement........................................................................... 67
TESTIMONIUM
SIGNATURES AND SEALS
ACKNOWLEDGEMENTS
INDENTURE, dated as of November 15, 1996, between Arizona Public Service
Company, a corporation duly organized and existing under the laws of the State
of Arizona (herein called the "Company"), having its principal office at 400
North Fifth Street, Phoenix, Arizona 85004, and The Bank of New York, a New York
banking corporation, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its Senior Notes
(herein called the "Notes"), to be issued in one or more series as in this
Indenture provided.
Subject to the provisions of Section 403 hereof, the Company may issue one or
more series of Senior Note First Mortgage Bonds (as hereinafter defined) and
deliver such Senior Note First Mortgage Bonds to the Trustee to hold in trust
for the benefit of the respective Holders from time to time of the related
series of Notes, or require the Trustee to deliver to the Company for
cancellation any and all Senior Note First Mortgage Bonds held by the Trustee.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Notes by
the Holders thereof, it is mutually agreed, for the benefit of all Holders of
the Notes or of series thereof, as follows:
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:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) 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;
(3) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles,
and, except as otherwise herein expressly provided, the term "generally accepted
accounting principles" with respect to any computation required or permitted
hereunder shall mean such accounting principles as are generally accepted in the
United States of America;
(4) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may be,
of this Indenture; and
(5) 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.
"Act", when used with respect to any Holder, has the meaning specified in
Section 104.
"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.
"Authenticating Agent" means any Person authorized by the Trustee pursuant
to Section 714 to act on behalf of the Trustee to authenticate Notes of one or
more series.
"Board of Directors" means either the board of directors of the Company or
any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary or Associate Secretary of the Company to have been
duly adopted by the Board of Directors and to be in full force and effect on the
date of such certification, and delivered to the Trustee.
"Business Day", when used with respect to any Place of Payment, means each
Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in that Place of Payment are authorized or obligated by law
or executive order to close.
"Commission" means the Securities and Exchange Commission, from time to
time constituted, created under the Exchange Act, or, if at any time after the
execution of this instrument 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.
"Company" means the Person named as the "Company" in the first paragraph
of this instrument until a successor Person shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its President or a Vice President, and by its Treasurer,
an Assistant Treasurer, its Secretary, an Assistant Secretary or an Associate
Secretary, and delivered to the Trustee.
"Corporate Trust Office" means the office of the Trustee in the City of
New York, New York at which at any particular time its corporate trust business
shall be principally administered, which office at the date hereof is located at
101 Barclay Street, New York, New York 10286.
"Corporation" means a corporation, association, company, joint-stock
company or business trust.
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"Covenant Defeasance" has the meaning specified in Section 1403.
"Defaulted Interest" has the meaning specified in Section 307.
"Defeasance" has the meaning specified in Section 1402.
"Depositary" means, with respect to Notes of any series issuable in whole
or in part in the form of one or more Global Notes, a clearing agency registered
under the Exchange Act that is designated to act as Depositary for such Notes as
contemplated by Section 301.
"Event of Default" has the meaning specified in Section 601.
"Exchange Act" means the Securities Exchange Act of 1934 and any statute
successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 104.
"Expert" means any officer of the Company familiar with the terms of the
First Mortgage and this Indenture, any law firm, any investment banking firm, or
any other Person, in each case that is appointed by Company Order, is an expert
in the applicable matter, and is satisfactory in the reasonable judgment of the
Trustee.
"First Mortgage" means the Mortgage and Deed of Trust, dated as of July 1,
1946, from the Company to The Bank of New York, as successor trustee to Bank of
America National Trust and Savings Association, as supplemented and amended from
time to time.
"First Mortgage Bonds" means all first mortgage bonds issued by the
Company and outstanding under the First Mortgage, other than Senior Note First
Mortgage Bonds.
"Global Note" means a Note that evidences all or part of the Notes of any
series and bears the legend set forth in Section 204 (or such legend as may be
specified as contemplated by Section 301 for such Notes).
"Holder" means a Person in whose name a Note is registered in the Note
Register.
"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,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the terms of particular
series of Notes established as contemplated by Section 301.
"independent", when applied to any accountant, appraiser, or other Expert,
shall mean such a Person who is in fact independent, selected by the Company and
approved by the Trustee in the exercise of reasonable care.
"Interest", when used with respect to an Original Issue Discount Note
which by its terms bears interest only after Maturity, means interest payable
after Maturity.
"Interest Payment Date", when used with respect to any Note, means the
Stated Maturity of an instalment of interest on such Note.
3
"Investment Company Act" means the Investment Company Act of 1940 and any
statute successor thereto, in each case as amended from time to time.
"Maturity", when used with respect to any Note, means the date on which
the principal of such Note or an instalment of principal becomes due and payable
as therein or herein provided, whether at the Stated Maturity or by declaration
of acceleration, call for redemption or otherwise.
"Mortgage Trustee" means the Person serving as trustee at the time under
the First Mortgage.
"Notes" has the meaning stated in the first recital of this Indenture and
more particularly means any Notes authenticated and delivered under this
Indenture.
"Note Register" and "Note Registrar" have the respective meanings
specified in Section 305.
"Notice of Default" means a written notice of the kind specified in
Section 601(4).
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, a Vice Chairman of the Board, the President or a Vice President, and by
the Treasurer, an Assistant Treasurer, the Controller, the Secretary or an
Assistant Secretary, of the Company, and delivered to the Trustee. One of the
officers signing an Officers' Certificate given pursuant to Section 1104 shall
be the principal executive, financial or accounting officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company, or other counsel who shall be acceptable to the
Trustee.
"Original Issue Discount Note" means any Note which provides for an amount
less than the principal amount thereof to be due and payable upon a declaration
of acceleration of the Maturity thereof pursuant to Section 602.
"Outstanding", when used with respect to Notes, means, as of the date of
determination, all Notes theretofore authenticated and delivered under this
Indenture, except:
(1) Notes theretofore cancelled by the Trustee or delivered to the
Trustee for cancellation;
(2) Notes for whose payment or redemption money in the necessary amount
has been theretofore deposited with the Trustee or any Paying Agent (other
than the Company) in trust or set aside and segregated in trust by the
Company (if the Company shall act as its own Paying Agent) for the Holders of
such Notes; provided that, if such Notes 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;
(3) Notes as to which Defeasance has been effected pursuant to Section
1402; and
4
(4) Notes which have been paid pursuant to Section 306 or in exchange
for or in lieu of which other Notes have been authenticated and delivered
pursuant to this Indenture, other than any such Notes in respect of which
there shall have been presented to the Trustee proof satisfactory to it that
such Notes are held by a bona fide purchaser in whose hands such Notes are
valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Notes have given, made or taken any request,
demand, authorization, direction, notice, consent, waiver or other action
hereunder as of any date, (A) the principal amount of an Original Issue Discount
Note which shall be deemed to be Outstanding shall be the amount of the
principal thereof which would be due and payable as of such date upon
acceleration of the Maturity thereof to such date pursuant to Section 602, (B)
if, as of such date, the principal amount payable at the Stated Maturity of a
Note is not determinable, the principal amount of such Note which shall be
deemed to be Outstanding shall be the amount as specified or determined as
contemplated by Section 301, (C) the principal amount of a Note denominated in
one or more foreign currencies or currency units which shall be deemed to be
Outstanding shall be the U.S. dollar equivalent, determined as of such date in
the manner provided as contemplated by Section 301, of the principal amount of
such Note (or, in the case of a Note described in Clause (A) or (B) above, of
the amount determined as provided in such Clause), and (D) Notes owned by the
Company or any other obligor upon the Notes or any Affiliate of the Company 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 relying
upon any such request, demand, authorization, direction, notice, consent, waiver
or other action, only Notes which the Trustee actually knows to be so owned
shall be so disregarded. Notes 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 Notes and that
the pledgee is not the Company or any other obligor upon the Notes or any
Affiliate of the Company or of such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or any premium or interest on any Notes on behalf of the Company.
"Person" means any individual, corporation, partnership, joint venture,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Place of Payment", when used with respect to the Notes of any series,
means the place or places where the principal of and any premium and interest on
the Notes of that series are payable as specified as contemplated by Section
301.
"Predecessor Note" of any particular Note means every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note; and, for the purposes of this definition, any Note
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Note shall be deemed to evidence the same
debt as the mutilated, destroyed, lost or stolen Note.
"Redemption Date", when used with respect to any Note to be redeemed,
means the date fixed for such redemption by or pursuant to this Indenture.
5
"Redemption Price", when used with respect to any Note to be redeemed,
means the price at which it is to be redeemed pursuant to this Indenture.
"Regular Record Date" for the interest payable on any Interest Payment
Date on the Notes of any series means the date specified for that purpose as
contemplated by Section 301.
"Release Date" means the date as of which all First Mortgage Bonds have
been retired through payment, redemption, or otherwise at, before or after the
maturity thereof.
"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 senior trust officer, 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.
"Securities Act" means the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time.
"Senior Note First Mortgage Bonds" shall mean any bonds issued by the
Company under the First Mortgage and delivered to the Trustee pursuant to
Section 401 hereof.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Note or any instalment of
principal thereof or interest thereon, means the date specified in such Note as
the fixed date on which the principal of such Note or such instalment of
principal or interest is due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by the Company or by one or
more other Subsidiaries, or by the Company and one or more other Subsidiaries.
For the purposes of this definition, "voting stock" means stock which ordinarily
has voting power for the election of directors, whether at all times or only so
long as no senior class of stock has such voting power by reason of any
contingency.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first paragraph
of this instrument 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
6
is then a Trustee hereunder, and if at any time there is more than one such
Person, "Trustee" as used with respect to the Notes of any series shall mean the
Trustee with respect to Notes of that series.
"U.S. Government Obligation" has the meaning specified in Section 1404.
"Vice President", when used with respect to the Company 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".
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirements set forth in
this Indenture.
Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture shall include,
(1) a statement that each individual signing such certificate or
opinion 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
certificate or opinion 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; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
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.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel,
7
unless such officer knows, or in the exercise of reasonable care should know,
that the certificate or opinion or representations with respect to the matters
upon which his certificate or opinion is based are erroneous. Any such
certificate or opinion of counsel may be based, insofar as it relates to factual
matters, upon a certificate or opinion of, or representations by, an officer or
officers of the Company stating that the information with respect to such
factual matters is in the possession of the Company, unless such counsel knows,
or in the exercise of reasonable care should know, that the certificate or
opinion or representations with respect to such matters are erroneous.
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; Record Dates.
Any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Indenture to be given, made or taken
by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 701) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. 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 his
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.
The ownership of Notes shall be proved by the Note Register.
Any request, demand, authorization, direction, notice, consent, waiver or
other Act of the Holder of any Note shall bind every future Holder of the same
Note and the Holder of every Note 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 Company in reliance
thereon, whether or not notation of such action is made upon such Note.
8
The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Notes of any series entitled to give,
make or take any request, demand, authorization, direction, notice, consent,
waiver or other action provided or permitted by this Indenture to be given, made
or taken by Holders of Notes of such series, provided that the Company may not
set a record date for, and the provisions of this paragraph shall not apply with
respect to, the giving or making of any notice, declaration, request or
direction referred to in the next paragraph. If any record date is set pursuant
to this paragraph, the Holders of Outstanding Notes of the relevant series on
such record date, and no other Holders, shall be entitled to take or revoke the
relevant action, whether or not such Holders remain Holders after such record
date; provided that no such action shall be effective hereunder unless taken on
or prior to the applicable Expiration Date by Holders of the requisite principal
amount of Outstanding Notes of such series on such record date. Nothing in this
paragraph shall be construed to prevent the Company from setting a new record
date for any action for which a record date has previously been set pursuant to
this paragraph (whereupon the record date previously set shall automatically and
with no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Notes of the relevant series on
the date such action is taken. Promptly after any record date is set pursuant to
this paragraph, the Company, at its own expense, shall cause notice of such
record date, the proposed action by Holders and the applicable Expiration Date
to be given to the Trustee in writing and to each Holder of Notes of the
relevant series in the manner set forth in Section 106.
The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Notes of any series entitled to join in
the giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 602, (iii) any request to institute
proceedings referred to in Section 607(2) or (iv) any direction referred to in
Section 612, in each case with respect to Notes of such series. If any record
date is set pursuant to this paragraph, the Holders of Outstanding Notes of such
series on such record date, and no other Holders, shall be entitled to join in
such notice, declaration, request or direction or to revoke the same, whether or
not such Holders remain Holders after such record date; provided that no such
action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Notes of such series on such record date. Nothing in this paragraph shall be
construed to prevent the Trustee from setting a new record date for any action
for which a record date has previously been set pursuant to this paragraph
(whereupon the record date previously set shall automatically and with no action
by any Person be cancelled and of no effect), and nothing in this paragraph
shall be construed to render ineffective any action taken by Holders of the
requisite principal amount of Outstanding Notes of the relevant series on the
date such action is taken. Promptly after any record date is set pursuant to
this paragraph, the Trustee, at the Company's expense, shall cause notice of
such record date, the proposed action by Holders and the applicable Expiration
Date to be given to the Company in writing and to each Holder of Notes of the
relevant series in the manner set forth in Section 106.
With respect to any record date set pursuant to this Section, the party
hereto which sets such record dates may designate any day as the "Expiration
Date" and from time to time may change the Expiration Date to any earlier or
later day; provided that no such change shall be effective unless notice of the
proposed new Expiration Date is given to the other
9
party hereto in writing, and to each Holder of Notes of the relevant series in
the manner set forth in Section 106, on or prior to the existing Expiration
Date. If an Expiration Date is not designated with respect to any record date
set pursuant to this Section, the party hereto which set such record date shall
be deemed to have initially designated the 180th day after such record date as
the Expiration Date with respect thereto, subject to its right to change the
Expiration Date as provided in this paragraph. Notwithstanding the foregoing, no
Expiration Date shall be later than the 180th day after the applicable record
date.
Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to any particular Note may do so with regard to all
or any part of the principal amount of such Note or by one or more duly
appointed agents each of which may do so pursuant to such appointment with
regard to all or any part of such principal amount.
SECTION 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other document provided or permitted by this Indenture to be
made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company 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, Attention: Corporate Trustee
Administration, or
(2) the Company 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 Company addressed to it
at the address of its principal office specified in the first paragraph of this
instrument or at any other address previously furnished in writing to the
Trustee by the Company.
SECTION 106. Notice to Holders; Waiver.
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, to each Holder affected
by such event, at his address as it appears in the Note 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. In any case where notice to Holders is
given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Indenture provides for notice
in any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by 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 case by reason of the suspension of regular mail service or by reason
of any other cause it shall be impracticable to give such notice by mail, then
such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
10
SECTION 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a provision of
the Trust Indenture Act which is required under such Act to be a part of and
govern this Indenture, the latter provision shall control. If any provision of
this Indenture modifies or excludes any provision of the Trust Indenture Act
which may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
SECTION 108. 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 construction hereof.
SECTION 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall bind
its successors and assigns, whether so expressed or not.
SECTION 110. Separability Clause.
In case any provision in this Indenture or in the Notes 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 111. Benefits of Indenture.
Nothing in this Indenture or in the Notes, express or implied, shall give
to any Person, other than the parties hereto and their successors hereunder and
the Holders, any benefit or any legal or equitable right, remedy or claim under
this Indenture.
SECTION 112. Governing Law.
This Indenture and the Notes shall be governed by and construed in
accordance with the law of the State of New York, without regard to conflicts of
laws principles thereof.
11
SECTION 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Note shall not be a Business Day at any Place of Payment, then
(notwithstanding any other provision of this Indenture or of the Notes (other
than a provision of any Note which specifically states that such provision shall
apply in lieu of this Section)) payment of interest or principal (and 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 Interest Payment Date or Redemption Date, or at the
Stated Maturity.
ARTICLE TWO
NOTE FORMS
SECTION 201. Forms Generally.
The Notes of each series shall be in substantially the form set forth in
this Article, or in such other form as shall be established by or pursuant to a
Board Resolution or in one or more indentures supplemental hereto, in each case
with such appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this Indenture, and may have such letters,
numbers or other marks of identification and such legends or endorsements placed
thereon as may be required to comply with the rules of any securities exchange
or Depositary therefor or as may, consistently herewith, be determined by the
officers executing such Notes, as evidenced by their execution thereof. If the
form of Notes of any series is established by action taken pursuant to a Board
Resolution, a copy of an appropriate record of such action shall be certified by
the Secretary or an Assistant Secretary of the Company and delivered to the
Trustee at or prior to the delivery of the Company Order contemplated by Section
303 for the authentication and delivery of such Notes.
The definitive Notes shall be printed, lithographed or engraved on steel
engraved borders or may be produced in any other manner, all as determined by
the officers executing such Notes, as evidenced by their execution of such
Notes.
SECTION 202. Form of Face of Note.
[Insert any legend required by the Internal Revenue Code and the
regulations thereunder.]
ARIZONA PUBLIC SERVICE COMPANY
..................................................
No. ......... $ ........
CUSIP No.______
12
Arizona Public Service Company, a corporation duly organized and existing
under the laws of Arizona (herein called the "Company", which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to
..............................................., or registered assigns, the
principal sum of ...................................... Dollars on
........................................................ [if the Note is to bear
interest prior to Maturity, insert _ , and to pay interest thereon from
............. or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, semi-annually on ............ and
............ in each year, commencing ........., at the rate of ....% per annum,
until the principal hereof is paid or made available for payment [if applicable,
insert _ , provided that any principal and premium, and any such instalment of
interest, which is overdue shall bear interest at the rate of ...% per annum (to
the extent that the payment of such interest shall be legally enforceable), from
the dates such amounts are due until they are paid or made available for
payment, and such interest shall be payable on demand]. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Note (or
one or more Predecessor Notes) is registered at the close of business on the
Regular Record Date for such interest, which shall be the ....... or .......
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly provided
for 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 Note (or one or more
Predecessor Notes) is registered at the close of business on a Special Record
Date for the payment of such Defaulted Interest to be fixed by the Trustee,
notice whereof shall be given to Holders of Notes of this series not less than
10 days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Notes of this series may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in said Indenture].
[If the Note is not to bear interest prior to Maturity, insert _ The principal
of this Note shall not bear interest except in the case of a default in payment
of principal upon acceleration, upon redemption or at Stated Maturity and in
such case the overdue principal and any overdue premium shall bear interest at
the rate of ....% per annum (to the extent that the payment of such interest
shall be legally enforceable), from the dates such amounts are due until they
are paid or made available for payment. Interest on any overdue principal or
premium shall be payable on demand. Any such interest on overdue principal or
premium which is not paid on demand shall bear interest at the rate of ......%
per annum (to the extent that the payment of such interest on interest shall be
legally enforceable), from the date of such demand until the amount so demanded
is paid or made available for payment.
Interest on any overdue interest shall be payable on demand.]
Payment of the principal of (and premium, if any) and [if applicable,
insert _ any such] interest on this Note will be made at the office or agency of
the Company maintained for that purpose in ............, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts [if applicable, insert _ ;
provided, however, that at the option of the Company payment of interest may be
made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Note Register].
13
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Note shall
not be entitled to any benefit under the Indenture or be valid or obligatory for
any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
ARIZONA PUBLIC SERVICE COMPANY
By..........................
Attest:
......................
SECTION 203. Form of Reverse of Note.
This Note is one of a duly authorized issue of securities of the Company
(herein called the "Notes"), issued and to be issued in one or more series under
an Indenture, dated as of November 15, 1996 (herein called the "Indenture",
which term shall have the meaning assigned to it in such instrument), between
the Company and The Bank of New York, as Trustee (herein called the "Trustee",
which term includes any successor trustee under the Indenture), and reference is
hereby made to the Indenture for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee and the Holders of the Notes and of the terms upon which the Notes are,
and are to be, authenticated and delivered. This Note is one of the series
designated on the face hereof [if applicable, insert _ , limited in aggregate
principal amount to $...........].
[If the Note is issued before the Release Date, insert __ Prior to the
Release Date (as hereinafter defined), this Note will be secured by First
Mortgage Bonds, Senior Note Series ....... (the "Senior Note Series .......
Bonds") delivered by the Company to the Trustee for the benefit of the Holders
of the series of Notes of which this Note is a part, issued under the Mortgage
and Deed of Trust, dated as of July 1, 1946, from the Company to The Bank of New
York, as successor trustee (the "Mortgage Trustee"), as supplemented and amended
(the "First Mortgage"). Reference is made to the First Mortgage for a
description of property mortgaged and pledged, the nature and extent of the
security, the rights of the holders of the first mortgage bonds under the First
Mortgage and of the Mortgage Trustee in respect thereof, the duties and
immunities of the Mortgage Trustee and the terms and conditions upon which the
Senior Note Series ...... Bonds are secured and the circumstances under which
additional first mortgage bonds may be issued.
14
FROM AND AFTER SUCH TIME AS ALL FIRST MORTGAGE BONDS (OTHER THAN SENIOR NOTE
FIRST MORTGAGE BONDS, AS SUCH TERM IS DEFINED IN THE INDENTURE,) HAVE BEEN
RETIRED THROUGH PAYMENT, REDEMPTION OR OTHERWISE AT, BEFORE OR AFTER THE
MATURITY THEREOF (THE "RELEASE DATE"), THE SENIOR NOTE FIRST MORTGAGE BONDS
SHALL CEASE TO SECURE THE NOTES IN ANY MANNER.]
[If applicable, insert _ The Notes of this series are subject to
redemption upon not less than 30 days' notice by mail, [if applicable, insert _
(1) on ........... in any year commencing with the year ...... and ending with
the year ...... through operation of the sinking fund for this series at a
Redemption Price equal to 100% of the principal amount, and (2)] at any time [if
applicable, insert _ on or after .........., 19..], as a whole or in part, at
the election of the Company, at the following Redemption Prices (expressed as
percen- tages of the principal amount): If redeemed [if applicable, insert _ on
or before ..............., ...%, and if redeemed] during the 12-month period
beginning ............. of the years indicated,
Year Redemption Year Redemption
- ---- Price ---- Price
---------- ----------
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption [if applicable, insert _ (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest installments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Notes, or
one or more Predecessor Notes, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.]
[If applicable, insert _ The Notes of this series are subject to
redemption upon not less than 30 days' notice by mail, (1) on ............ in
any year commencing with the year .... and ending with the year .... through
operation of the sinking fund for this series at the Redemption Prices for
redemption through operation of the sinking fund (expressed as percentages of
the principal amount) set forth in the table below, and (2) at any time [if
applicable, insert _ on or after ............], as a whole or in part, at the
election of the Company, at the Redemption Prices for redemption otherwise than
through operation of the sinking fund (expressed as percentages of the principal
amount) set forth in the table below: If redeemed during the 12-month period
beginning ............ of the years indicated,
15
Year Redemption Price Redemption Price For
- ---- For Redemption Redemption Otherwise
Through Operation Than Through Operation
of the of the Sinking Fund
Sinking Fund ----------------------
-----------------
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest installments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Notes, or one or more Predecessor
Notes, of record at the close of business on the relevant Record Dates referred
to on the face hereof, all as provided in the Indenture.]
[If applicable, insert _ Notwithstanding the foregoing, the Company may
not, prior to ............., redeem any Notes of this series as contemplated by
[if applicable, insert _ Clause (2) of] the preceding paragraph as a part of, or
in anticipation of, any refunding operation by the application, directly or
indirectly, of moneys borrowed having an interest cost to the Company
(calculated in accordance with generally accepted financial practice) of less
than .....% per annum.]
[If applicable, insert _ The sinking fund for this series provides for the
redemption on ............ in each year beginning with the year ....... and
ending with the year ...... of [if applicable, insert _ not less than
$.......... ("mandatory sinking fund") and not more than] $......... aggregate
principal amount of Notes of this series. Notes of this series acquired or
redeemed by the Company otherwise than through [if applicable, insert _
mandatory] sinking fund payments may be credited against subsequent [if
applicable, insert _ mandatory] sinking fund payments otherwise required to be
made [if applicable, insert _ , in the inverse order in which they become due].]
[If the Note is subject to redemption of any kind, insert _ In the event
of redemption of this Note in part only, a new Note or Notes of this series and
of like tenor for the unredeemed portion hereof will be issued in the name of
the Holder hereof upon the cancellation hereof.]
[If applicable, insert _ The Indenture contains provisions for defeasance
at any time of [the entire indebtedness of this Note] [or] [certain restrictive
covenants and Events of Default with respect to this Note] [, in each case] upon
compliance with certain conditions set forth in the Indenture.]
[If the Note is not an Original Issue Discount Note, insert _ If an Event
of Default with respect to Notes of this series shall occur and be continuing,
the principal of the Notes of
16
this series may be declared due and payable in the manner and with the effect
provided in the Indenture.]
[If the Note is an Original Issue Discount Note, insert _ If an Event of
Default with respect to Notes of this series shall occur and be continuing, an
amount of principal of the Notes of this series may be declared due and payable
in the manner and with the effect provided in the Indenture. Such amount shall
be equal to _ insert formula for determining the amount. Upon payment (i) of the
amount of principal so declared due and payable and (ii) of interest on any
overdue principal, premium and interest (in each case to the extent that the
payment of such interest shall be legally enforceable), all of the Company's
obligations in respect of the payment of the principal of and premium and
interest, if any, on the Notes of this series shall terminate.]
[If the Note is issued before the Release Date, insert _ If an Event of
Default with respect to Notes of this series shall occur and be continuing, the
principal of the Notes may be declared due and payable in the manner and with
the effect provided in the Indenture and, upon such declaration, the Trustee can
demand the acceleration of the payment of principal of the Senior Note Series
...... Bonds as provided in the Indenture.]
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Notes of each series to be affected
under the Indenture at any time by the Company and the Trustee with the consent
of the Holders of a majority in principal amount of the Notes at the time
Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Notes of each series at the time Outstanding, on behalf of the Holders of
all Notes of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note shall
be conclusive and binding upon such Holder and upon all future Holders of this
Note and of any Note issued upon the registration of transfer hereof or in
exchange therefor or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Note.
As provided in and subject to the provisions of the Indenture, the Holder
of this Note shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Notes of this series, the Holders of not less than 25% in principal amount of
the Notes of this series at the time Outstanding shall have made written request
to the Trustee to institute proceedings in respect of such Event of Default as
Trustee and offered the Trustee reasonable indemnity, and the Trustee shall not
have received from the Holders of a majority in principal amount of Notes of
this series at the time Outstanding a direction inconsistent with such request,
and shall have failed to institute any such proceeding, for 60 days after
receipt of such notice, request and offer of indemnity. The foregoing shall not
apply to any suit instituted by the Holder of this Note for the enforcement of
any payment of principal hereof or any premium or interest hereon on or after
the respective due dates expressed herein.
17
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and interest
on this Note at the times, place and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note is registrable in the Note Register, upon
surrender of this Note for registration of transfer at the office or agency of
the Company in any place where the principal of and any premium and interest on
this Note are payable, duly endorsed by, or accompanied by a written instrument
of transfer in form satisfactory to the Company and the Note Registrar duly
executed by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Notes of this series and of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees.
The Notes of this series are issuable only in registered form without
coupons in denominations of $....... and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Notes of this series are exchangeable for a like aggregate principal amount of
Notes of this series and of like tenor of a different authorized denomination,
as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
All terms used in this Note which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
SECTION 204. Form of Legend for Global Notes.
Unless otherwise specified as contemplated by Section 301 for the Notes
evidenced thereby, every Global Note authenticated and delivered hereunder shall
bear a legend in substantially the following form:
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF.
THIS NOTE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A NOTE REGISTERED, AND NO
TRANSFER OF THIS NOTE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
18
SECTION 205. Form of Trustee's Certificate of Authentication.
The Trustee's certificates of authentication shall be in substantially the
following form:
CERTIFICATION OF AUTHENTICATION
This is one of the Notes of the series designated therein referred to in
the within-mentioned Indenture.
Dated: THE BANK OF NEW YORK,
As Trustee
By..........................
Authorized Signatory
ARTICLE THREE
THE NOTES
SECTION 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Notes which may be authenticated and
delivered under this Indenture is unlimited.
The Notes may be issued in one or more series. There shall be established
by or pursuant to a Board Resolution and, subject to Section 303, set forth, or
determined in the manner provided, in an Officers' Certificate, or established
in one or more indentures supplemental hereto, prior to the issuance of Notes of
any series,
(1) the title of the Notes of the series (which shall distinguish the
Notes of the series from Notes of any other series);
(2) any limit upon the aggregate principal amount of the Notes of the
series which may be authenticated and delivered under this Indenture (except
for Notes authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Notes of the series pursuant to Section
304, 305, 306, 1006 or 1207 and except for any Notes which, pursuant to
Section 303, are deemed never to have been authenticated and delivered
hereunder);
(3) the Person to whom any interest on a Note of the series shall be
payable, if other than the Person in whose name that Note (or one or more
Predecessor Notes) is registered at the close of business on the Regular
Record Date for such interest;
(4) the date or dates on which the principal of any Notes of the series
is payable;
(5) the rate or rates at which any Notes of the series shall bear
interest, if any, the date or dates from which any such interest shall
accrue, the Interest Payment Dates on
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which any such interest shall be payable, the manner (if any) of
determination of such Interest Payment Dates and the Regular Record Date for
any such interest payable on any Interest Payment Date;
(6) the right, if any, to extend the interest payment periods and the
duration of such extension;
(7) the place or places where the principal of and any premium and
interest on any Notes of the series shall be payable;
(8) the period or periods within which, the price or prices at which
and the terms and conditions upon which any Notes of the series may be
redeemed, in whole or in part, at the option of the Company and, if other
than by a Board Resolution, the manner in which any election by the Company
to redeem the Notes shall be evidenced;
(9) the obligation, if any, of the Company to redeem or purchase any
Notes of the series pursuant to any sinking fund or analogous provisions or
at the option of the Holder thereof and the period or periods within which,
the price or prices at which and the terms and conditions upon which any
Notes of the series shall be redeemed or purchased, in whole or in part,
pursuant to such obligation;
(10) if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which any Notes of the series shall be
issuable;
(11) if the amount of principal of or any premium or interest on any
Notes of the series may be determined with reference to an index or pursuant
to a formula, the manner in which such amounts shall be determined;
(12) if other than the currency of the United States of America, the
currency, currencies or currency units in which the principal of or any
premium or interest on any Notes of the series shall be payable and the
manner of determining the equivalent thereof in the currency of the United
States of America for any purpose, including for purposes of the definition
of "Outstanding" in Section 101;
(13) if the principal of or any premium or interest on any Notes of the
series is to be payable, at the election of the Company or the Holder
thereof, in one or more currencies or currency units other than that or those
in which such Notes are stated to be payable, the currency, currencies or
currency units in which the principal of or any premium or interest on such
Notes as to which such election is made shall be payable, the periods within
which and the terms and conditions upon which such election is to be made and
the amount so payable (or the manner in which such amount shall be
determined);
(14) if other than the entire principal amount thereof, the portion of
the principal amount of any Notes of the series which shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section 602;
(15) if the principal amount payable at the Stated Maturity of any
Notes of the series will not be determinable as of any one or more dates
prior to the Stated Maturity,
20
the amount which shall be deemed to be the principal amount of such
Notes as of any such date for any purpose thereunder or hereunder, including
the principal amount thereof which shall be due and payable upon any Maturity
other than the Stated Maturity or which shall be deemed to be Outstanding as
of any date prior to the Stated Maturity (or, in any such case, the manner in
which such amount deemed to be the principal amount shall be determined);
(16) if applicable, that the Notes of the series, in whole or any
specified part, shall be defeasible pursuant to Section 1402 or Section 1403
or both such Sections and, if other than by a Board Resolution, the manner in
which any election by the Company to defease such Notes shall be evidenced;
(17) if applicable, that any Notes of the series shall be issuable in
whole or in part in the form of one or more Global Notes and, in such case,
the respective Depositaries for such Global Notes, the form of any legend or
legends which shall be borne by any such Global Note in addition to or in
lieu of that set forth in Section 204 and any circumstances in addition to or
in lieu of those set forth in Clause (2) of the last paragraph of Section 305
in which any such Global Note may be exchanged in whole or in part for Notes
registered, and any transfer of such Global Note in whole or in part may be
registered, in the name or names of Persons other than the Depositary for
such Global Note or a nominee thereof;
(18) if any Notes of the series shall be issued prior to the Release
Date, the designation of the series of Senior Note First Mortgage Bonds to be
delivered to the Trustee in connection with the issuance of such series of
Notes;
(19) any addition to or change in the Events of Default which applies
to any Notes of the series and any change in the right of the Trustee or the
requisite Holders of such Notes to declare the principal amount thereof due
and payable pursuant to Section 602;
(20) any addition to or change in the covenants set forth in Article
Eleven which applies to Notes of the series; and
(21) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture, except as permitted by
Section 1001(5)).
All Notes of any one series shall be substantially identical except as to
denomination and except as may otherwise be provided in or pursuant to the Board
Resolution referred to above and (subject to Section 303) set forth, or
determined in the manner provided, in the Officers' Certificate referred to
above or in any such indenture supplemental hereto.
If any of the terms of the series are established by action taken pursuant
to a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
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SECTION 302. Denominations.
The Notes of each series shall be issuable only in fully registered form
without coupons and only in such denominations as shall be specified as
contemplated by Section 301. In the absence of any such specified denomination
with respect to the Notes of any series, the Notes of such series shall be
issuable in denominations of $1,000 and any integral multiple thereof.
SECTION 303. Execution, Authentication, Delivery and Dating.
Unless otherwise provided as contemplated by Section 301 with respect to
any series of Notes, the Notes shall be executed on behalf of the Company by its
Chairman of the Board, its Vice Chairman of the Board, its President or one of
its Vice Presidents, under its corporate seal affixed thereto or reproduced
thereon attested by its Secretary or one of its Assistant Secretaries. The
signature of any of these officers on the Notes may be manual or facsimile.
Notes bearing the manual or facsimile signatures of individuals who were
at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Notes of any series executed by the Company
to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Notes and, if prior to the Release Date,
Senior Note First Mortgage Bonds of a series of Senior Note First Mortgage Bonds
conforming to the requirements of Sections 401 and 402 hereof, and the Trustee
in accordance with the Company Order shall authenticate and deliver such Notes.
In authenticating such Notes, and accepting the additional responsibilities
under this Indenture in relation to such Notes, the Trustee shall be entitled to
receive, and (subject to Section 701) shall be fully protected in relying upon,
(1) if prior to the Release Date, the certificate of an Expert meeting the
requirements of Section 404(a) hereof and a series of Senior Note First Mortgage
Bonds meeting the requirements of Section 403 hereof, and (2) an Opinion of
Counsel stating,
(A) if the form of such Notes has been established by or pursuant to
Board Resolution or in a supplemental indenture as permitted by Section 201,
that such form has been duly authorized by the Company and established in
conformity with the provisions of this Indenture;
(B) if the terms of such Notes have been duly authorized by the Company
and established by or pursuant to Board Resolution or in a supplemental
indenture as permitted by Section 301, that such terms have been established
in conformity with the provisions of this Indenture;
(C) that such Notes, when authenticated and delivered by the Trustee
and issued by the Company in the manner and subject to any conditions
specified in such Opinion of Counsel, will have been duly issued under the
Indenture and will constitute valid and legally binding obligations of the
Company, entitled to the benefits provided by the Indenture, and enforceable
in accordance with their terms, subject to (a) bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
22
applicability relating to or affecting creditors' rights and to general
equity principles, (b) the necessity for compliance with the statutory
procedural rights governing the exercise of remedies by a secured creditor,
and (c) the qualification that certain waivers, proecedures, remedies, and
other provisions of such Notes and this Indenture may be unenforceable under
or limited by the laws of the State of Arizona; and
(D) if prior to the Release Date, that the Senior Note First Mortgage
Bonds of the related series of Senior Note First Mortgage Bonds being
delivered to the Trustee in connection with the issuance of such series of
Notes have been duly authorized, executed, authenticated, issued, and
delivered, constitute valid and legally binding obligations of the Company
entitled to the benefits and security provided by the First Mortgage, except
as the same may be limited by (a) general principles of equity or by
bankruptcy, insolvency, reorganization, arrangement, moratorium, or other
laws or equitable principles relating to or affecting the enforcement of
creditors' rights generally or the enforcement of the security provided by
the First Mortgage, (b) the necessity for compliance with the statutory
procedural requirements governing the exercise of remedies by a secured
creditor, and (c) the qualification that certain waivers, procedures,
remedies, and other provisions of the Senior Note First Mortgage Bonds and
the First Mortgage may be unenforceable under or limited by the law of the
State of Arizona; and that such Senior Note First Mortgage Bonds are entitled
to the benefits provided by the First Mortgage, equally and ratably, with all
First Mortgage Bonds and other Senior Note First Mortgage Bonds (if any)
outstanding thereunder, except as to sinking fund provisions; and
(E) that the Company's execution and delivery of this Indenture, such
Notes, such First Mortgage, and any such Senior Note First Mortgage Bonds
have been duly authorized by the Arizona Corporation Commission (the "ACC"),
the ACC had jurisdiction in the premises, and no further approval,
authorization, or consent of any other public board or body is necessary to
the validity of such execution and delivery of this Indenture, such Notes,
such First Mortgage, and any such Senior Note First Mortgage Bonds, except as
may be required under state securities or blue sky laws, as to which laws
such counsel shall not be required to express an opinion.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Notes if the issue of such Notes pursuant to this
Indenture will affect the Trustee's own rights, duties or immunities under the
Notes and this Indenture or otherwise in a manner which is not reasonably
acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the preceding
paragraph, if all Notes of a series are not to be originally issued at one time,
it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 301 or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the
authentication of each Note of such series if such documents are delivered at or
prior to the authentication upon original issuance of the first Note of such
series to be issued.
Each Note shall be dated the date of its authentication.
No Note shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose unless there appears on such Note a certificate of
authentication substantially in the form provided for herein executed by the
Trustee by manual signature of an authorized signatory, and such certificate
upon any Note shall be conclusive evidence, and the only evidence, that such
Note has been duly authenticated and delivered hereunder.
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Notwithstanding the foregoing, if any Note shall have been authenticated and
delivered hereunder but never issued and sold by the Company, and the Company
shall deliver such Note to the Trustee for cancellation as provided in Section
309, for all purposes of this Indenture such Note shall be deemed never to have
been authenticated and delivered hereunder and shall never be entitled to the
benefits of this Indenture.
SECTION 304. Temporary Notes.
Pending the preparation of definitive Notes of any series, the Company may
execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Notes which are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any authorized denomination, substantially of the tenor
of the definitive Notes in lieu of which they are issued and with such
appropriate insertions, omissions, substitutions and other variations as the
officers executing such Notes may determine, as evidenced by their execution of
such Notes.
If temporary Notes of any series are issued, the Company will cause
definitive Notes of that series to be prepared without unreasonable delay. After
the preparation of definitive Notes of such series, the temporary Notes of such
series shall be exchangeable for definitive Notes of such series upon surrender
of the temporary Notes of such series at the office or agency of the Company in
a Place of Payment for that series, without charge to the Holder. Upon surrender
for cancellation of any one or more temporary Notes of any series, the Company
shall execute and the Trustee shall authenticate and deliver in exchange
therefor one or more definitive Notes of the same series, of any authorized
denominations and of like tenor and aggregate principal amount. Until so
exchanged, the temporary Notes of any series shall in all respects be entitled
to the same benefits under this Indenture as definitive Notes of such series and
tenor.
SECTION 305. Registration, Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of the
Trustee a register (the register maintained in such office or in any other
office or agency of the Company in a Place of Payment being herein sometimes
referred to as the "Note Register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
of Notes and of transfers of Notes. The Trustee is hereby appointed "Note
Registrar" for the purpose of registering Notes and transfers of Notes as herein
provided.
Upon surrender for registration of transfer of any Note of a series at the
office or agency of the Company in a Place of Payment for that series, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Notes of the
same series, of any authorized denominations and of like tenor and aggregate
principal amount.
At the option of the Holder, Notes of any series may be exchanged for
other Notes of the same series, of any authorized denominations and of like
tenor and aggregate principal amount, upon surrender of the Notes to be
exchanged at such office or agency. Whenever any Notes are so surrendered for
exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Notes which the Holder making the exchange is entitled to receive.
24
All Notes issued upon any registration of transfer or exchange of Notes
shall be the valid obligations of the Company, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or for
exchange shall (if so required by the Company or the Trustee) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Note Registrar duly executed, by the Holder thereof or his
attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Notes, but the Company may require payment 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 Notes, other than exchanges
pursuant to Section 304, 1006 or 1207 not involving any transfer.
If the Notes of any series (or of any series and specified tenor) are to
be redeemed, the Company shall not be required (A) to issue, register the
transfer of or exchange any Notes of that series (or of that series and
specified tenor, as the case may be) during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of any
such Notes selected for redemption and ending at the close of business on the
day of such mailing, or (B) to register the transfer of or exchange any Note so
selected for redemption in whole or in part, except the unredeemed portion of
any Note being redeemed in part.
The provisions of Clauses (1), (2), (3) and (4) below shall apply only to
Global Notes:
(1) Each Global Note authenticated under this Indenture shall be
registered in the name of the Depositary designated for such Global Note or a
nominee thereof and delivered to such Depositary or a nominee thereof or
custodian therefor, and each such Global Note shall constitute a single Note
for all purposes of this Indenture.
(2) Notwithstanding any other provision in this Indenture, no Global
Note may be exchanged in whole or in part for Notes registered, and no
transfer of a Global Note in whole or in part may be registered, in the name
of any Person other than the Depositary for such Global Note or a nominee
thereof unless (A) such Depositary (i) has notified the Company that it is
unwilling or unable to continue as Depositary for such Global Note or (ii)
has ceased to be a clearing agency registered under the Exchange Act, (B)
there shall have occurred and be continuing an Event of Default with respect
to such Global Note or (C) there shall exist such circumstances, if any, in
addition to or in lieu of the foregoing as have been specified for this
purpose as contemplated by Section 301.
(3) Subject to Clause (2) above, any exchange of a Global Note for
other Notes may be made in whole or in part, and all Notes issued in exchange
for a Global Note or any portion thereof shall be registered in such names as
the Depositary for such Global Note shall direct.
(4) Every Note authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Note or any portion
thereof, whether pursuant to this
25
Section, Section 304, 306, 1006 or 1207 or otherwise, shall be
authenticated and delivered in the form of, and shall be, a Global Note,
unless such Note is registered in the name of a Person other than the
Depositary for such Global Note or a nominee thereof.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Notes.
If any mutilated Note is surrendered to the Trustee, the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
new Note of the same series and of like tenor and principal amount and bearing a
number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i) evidence to
their satisfaction of the destruction, loss or theft of any Note 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 Company
or the Trustee that such Note has been acquired by a bona fide purchaser, the
Company shall execute and the Trustee shall authenticate and deliver, in lieu of
any such destroyed, lost or stolen Note, a new Note of the same series and of
like tenor and principal amount and bearing a number not contemporaneously
outstanding.
In case any such mutilated, destroyed, lost or stolen Note has become or
is about to become due and payable, the Company in its discretion may, instead
of issuing a new Note, pay such Note.
Upon the issuance of any new Note under this Section, the Company 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 Note of any series issued pursuant to this Section in lieu of
any destroyed, lost or stolen Note shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Note 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 Notes of that series 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 Notes.
SECTION 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301 with respect
to any series of Notes, interest on any Note which is payable, and is punctually
paid or duly provided for, on any Interest Payment Date shall be paid to the
Person in whose name that Note (or one or more Predecessor Notes) is registered
at the close of business on the Regular Record Date for such interest.
26
Any interest on any Note of any series which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Notes of such series (or their respective
Predecessor Notes) are registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest, which shall be fixed
in the following manner. The Company shall notify the Trustee in writing of
the amount of Defaulted Interest proposed to be paid on each Note of such
series and the date of the proposed payment, and at the same time the Company
shall deposit with the Trustee an amount of money equal to the aggregate
amount proposed to be paid in respect of such Defaulted Interest 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 Interest as in this
Clause provided. Thereupon the Trustee shall fix a Special Record Date for
the payment of such Defaulted Interest 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 Company of such
Special Record Date and, in the name and at the expense of the Company, shall
cause notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor to be given to each Holder of Notes of such
series in the manner set forth in Section 106, not less than 10 days prior to
such Special Record Date. Notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor having been so mailed, such
Defaulted Interest shall be paid to the Persons in whose names the Notes of
such series (or their respective Predecessor Notes) are registered at the
close of business on such Special Record Date and shall no longer be payable
pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on the Notes
of any series in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Notes may be listed,
and upon such notice as may be required by such exchange, if, after notice
given by the Company to the Trustee of the proposed payment pursuant to this
Clause, such manner of payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Note delivered
under this Indenture upon registration of transfer of or in exchange for or in
lieu of any other Note shall carry the rights to interest accrued and unpaid,
and to accrue, which were carried by such other Note.
SECTION 308. Persons Deemed Owners.
Prior to due presentment of a Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name such Note is registered as the owner of such Note for the
purpose of receiving payment of
27
principal of and any premium and (subject to Section 307) any interest on such
Note and for all other purposes whatsoever, whether or not such Note be overdue,
and neither the Company, the Trustee nor any agent of the Company or the Trustee
shall be affected by notice to the contrary.
SECTION 309. Cancellation.
All Notes surrendered for payment, redemption, registration of transfer or
exchange or for credit against any sinking fund payment shall, if surrendered to
any Person other than the Trustee, be delivered to the Trustee and shall be
promptly cancelled by it. The Company may at any time deliver to the Trustee for
cancellation any Notes previously authenticated and delivered hereunder which
the Company may have acquired in any manner whatsoever, and may deliver to the
Trustee (or to any other Person for delivery to the Trustee) for cancellation
any Notes previously authenticated hereunder which the Company has not issued
and sold, and all Notes so delivered shall be promptly cancelled by the Trustee.
No Notes shall be authenticated in lieu of or in exchange for any Notes
cancelled as provided in this Section, except as expressly permitted by this
Indenture. All cancelled Notes held by the Trustee shall be disposed of as
directed by a Company Order; provided, however, that the Trustee shall not be
required to destroy such cancelled Notes.
SECTION 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for Notes of
any series, interest on the Notes of each series shall be computed on the basis
of a 360-day year of twelve 30-day months.
SECTION 311. CUSIP Numbers.
The Company in issuing the Notes may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such numbers
either as printed on the Notes or as contained in any notice of a redemption and
that reliance may be placed only on the other identification numbers printed on
the Notes, and any such redemption shall not be affected by any defect in or
omission of such numbers.
SECTION 312. Payments on Senior Note First Mortgage Bonds.
Subject to Article Five and Article Fourteen hereof, all payments made by
the Company to the Trustee on a series of Senior Note First Mortgage Bonds shall
be applied by the Trustee to pay, when due, principal of, premium, if any, and
interest on the related series of Notes and, to the extent so applied, shall
satisfy the Company's obligations on such Notes. The Company shall pay to the
Trustee principal of, premium, if any, and interest on a series of Senior Note
First Mortgage Bonds in a manner and at a time that will enable the
28
Trustee to make payments when due, of the principal of, premium, if any, and
interest on the related series of Notes.
ARTICLE FOUR
SENIOR NOTE FIRST MORTGAGE BONDS
SECTION 401. Acceptance of Senior Note First Mortgage Bonds.
At or prior to the time of issuance of a series of Notes hereunder at
any time prior to the Release Date, the Company shall deliver to the Trustee for
the benefit of the Holders of the Notes as described in Section 403 hereof, and
the Trustee shall accept therefor, Senior Note First Mortgage Bonds of a series
of Senior Note First Mortgage Bonds not theretofore delivered to the Trustee,
registered in the name of the Trustee and conforming to the requirements of
Section 402 hereof.
SECTION 402. Terms of Senior Note First Mortgage Bonds.
Each series of Senior Note First Mortgage bonds delivered to the
Trustee pursuant to Section 401 hereof shall have the same rate or rates of
interest (or interest calculated in the same manner), interest payment dates,
maturity and redemption provisions, and shall be in the same aggregate principal
amount, as the related series of Notes being issued.
SECTION 403. Senior Note First Mortgage Bonds as Security for Notes.
Until the Release Date and subject to Article Five and Article Fourteen
hereof, Senior Note First Mortgage Bonds delivered to the Trustee for the
benefit of the Holders of a related series of Notes shall serve as security for
any and all obligations of the Company under such related series of Notes,
including, but not limited to (1) the full and prompt payment of the principal
and premium, if any, on such Notes when and as the same shall become due and
payable in accordance with the terms and provisions of this Indenture or the
Notes either at the Stated Maturity thereof, upon acceleration of the maturity
thereof or upon redemption, and (2) the full and prompt payment of any interest
on such Notes when and as the same shall become due and payable in accordance
with the terms and provisions of this Indenture or the Notes.
Notwithstanding anything in this Indenture to the contrary, from and
after the Release Date, the obligation of the Company to make payment with
respect to the principal of and premium, if any, and interest on the Senior Note
First Mortgage Bonds shall be deemed satisfied and discharged as provided in the
supplemental trust indenture or indentures to the First Mortgage creating such
Senior First Mortgage Bonds and the Senior Note First Mortgage Bonds shall cease
to secure in any manner Notes theretofore or subsequently issued. From and after
the Release Date, all Notes, whether theretofore or subsequently issued, shall
be unsecured, and any conditions to the issuance of Notes that refer or relate
to Senior Note First Mortgage Bonds or the First Mortgage shall be inapplicable.
Following the Release Date, the Company shall cause the First Mortgage to be
closed and the
29
Company shall not issue any additional First Mortgage Bonds or Senior Note First
Mortgage Bonds under the First Mortgage. Notice of the occurrence of the Release
Date shall be given by the Trustee to the Holders of the Notes in the manner
provided for in Section 106 hereof not later than 30 days after the Company
notifies the Trustee of the occurrence of the Release Date.
SECTION 404. Fair Value Certificate.
(a) Upon the delivery by the Company to the Trustee of Senior Note
First Mortgage Bonds pursuant to Section 401 hereof, the Company shall
simultaneously therewith deliver to the Trustee a certificate of an Expert (1)
stating that it is familiar with the provisions of such Senior Note First
Mortgage Bonds and of this Indenture; (2) identifying such Senior Note First
Mortgage Bonds; (3) identifying the Notes being issued contemporaneously
therewith and (4) stating the fair value to the Company of such Senior Note
First Mortgage Bonds. If the fair value to the Company of the Senior Note First
Mortgage Bonds so delivered, as described in the certificate to be delivered
pursuant to this Section 404(a), both (l) is equal to or exceeds (A) $25,000 and
(B) 1% of the principal amount of the Notes outstanding at the date of delivery
of such Senior Note First Mortgage Bonds and (2) together with the fair value to
the Company, as described in the certificates delivered pursuant to this Section
404(a), of all other Senior Note First Mortgage Bonds delivered to the Trustee
since the commencement of the then current calendar year, is equal to or exceeds
10% of the principal amount of the Notes outstanding at the date of delivery of
such Senior Note First Mortgage Bonds, then the certificate required by this
Section 404(a) shall (1) be delivered by an independent Expert and (2) shall, in
addition to the certifications described above, state the fair value to the
Company of all Senior Note First Mortgage Bonds delivered to the Trustee
pursuant to Section 401 hereof since the commencement of the then current year
as to which a certificate was not delivered by an independent Expert.
(b) If Senior Note First Mortgage Bonds are delivered or surrendered to
the Company pursuant to Section 407 or 409 hereof, the Company shall
simultaneously therewith deliver to the Trustee a certificate of an Expert (1)
stating that it is familiar with the provisions of such Senior Note First
Mortgage Bonds and of this Indenture, (2) identifying such Senior Note First
Mortgage Bonds, (3) if applicable, identifying the Notes, the payment of the
interest on and principal of which has been discharged hereunder, (4) stating
that such delivery or surrender will not impair the lien of this Indenture in
contravention of the provisions of this Indenture. If, prior to the Release
Date, the fair value of the Senior Note First Mortgage Bonds so delivered and
surrendered, as described in the certificate to be delivered pursuant to this
Section 404(b), both (l) is equal to or exceeds (A) $25,000 and (B) 1% of the
principal amount of the Notes outstanding at the date of delivery or surrender
of such Senior Note First Mortgage Bonds and (2) together with the fair value,
as described in the certificates delivered pursuant to this Section 404(b), of
all other Senior Note First Mortgage Bonds released from the lien of this
Indenture since the commencement of the then current calendar year, is equal to
or exceeds 10% of the principal amount of the Notes outstanding at the date of
delivery or surrender of such Senior Note First Mortgage Bonds, then the
certificate required by this Section 404(b) shall be delivered by an independent
Expert.
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If, in connection with a delivery or surrender of outstanding Senior
Note First Mortgage Bonds provided for in subsection (a) or (b) of this Section
404, as the case may be, the Company provides to the trustee an Opinion of
Counsel stating that the certificate described by the applicable subsection is
not required by law, such certificate shall not be required to be delivered
hereunder in connection with such delivery or surrender.
SECTION 405. Senior Note First Mortgage Bonds Held by the Trustee.
The Trustee, as a Holder of Senior Note First Mortgage Bonds, shall
attend a meeting of holders of First Mortgage Bonds under the First Mortgage as
to which it receives due notice, or, at its option, shall deliver its proxy in
connection therewith. Either at such meeting, or otherwise where consent of
holders of First Mortgage Bonds issued under the First Mortgage is sought
without a meeting, the Trustee shall vote all of the Senior Note First Mortgage
Bonds held by it, or shall consent or withhold its consent with respect thereto,
as directed by the Holders of not less than a majority in aggregate principal
amount of the Outstanding Notes; provided, however, that the Trustee shall not
vote as such holder of a particular series of Senior Note First Mortgage Bonds
in favor of, or give its consent to, any action which, in the Trustee's opinion,
would materially adversely affect such series of Senior Note First Mortgage
Bonds in a manner not shared generally by all other Senior Note First Mortgage
Bonds, except upon notification by the Trustee to the Holders of the related
series of Outstanding Notes of such proposal and consent thereto of the holders
of not less than a majority in aggregate principal amount of the Outstanding
Notes of such series.
SECTION 406. No Transfer of Senior Note First Mortgage Bonds; Exception.
Except as required to effect an assignment to a successor trustee under
this Indenture or pursuant to Section 407 or Section 409 hereof, the Trustee
shall not sell, assign or transfer the Senior Note First Mortgage Bonds and the
Company shall issue stop transfer instructions to the Mortgage Trustee and any
transfer agent under the First Mortgage to effect compliance with this Section
406.
SECTION 407. Delivery to the Company of all Senior Note First Mortgage Bonds.
When the obligation of the Company to make payment with respect to the
principal of and premium, if any, and interest on the Senior Note First Mortgage
Bonds shall be satisfied or deemed satisfied pursuant to Section 403, Section
501 or Article Fourteen hereof, the Trustee shall, upon written request of the
Company and receipt of the certificate of the Expert described in Section 404(b)
hereof (if such certificate is then required by Section 404(b) hereof), deliver
to the Company without charge therefor all of the Senior Note First Mortgage
Bonds, together with such appropriate instruments of transfer or release as may
be reasonably requested by the Company. All Senior Note First Mortgage Bonds
delivered to the Company in accordance with this Section 407 shall be delivered
by the Company to the First Mortgage Trustee for cancellation.
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SECTION 408. Further Assurances.
The Company, at its own expense, shall do such further lawful acts and
things, and execute and deliver such additional conveyances, assignments,
assurances, agreements, financing statements and instruments, as may be
necessary in order to further assign, assure, perfect and confirm to the Trustee
its security interest in the Senior Note First Mortgage Bonds and for
maintaining, protecting and preserving such security interest.
SECTION 409. Exchange and Surrender of Senior Note First Mortgage Bonds.
At any time upon receipt of a Company Order at the written direction of
the Company, the Trustee shall surrender to the Company all or part of the
Senior Note First Mortgage Bonds in exchange for Senior Note First Mortgage
Bonds equal in aggregate principal amounts to, in different denominations than
but of the same series and with all other terms identical to, the Senior Note
First Mortgage Bonds so surrendered to the Company. In addition, at any time a
Note shall cease to be entitled to any lien, benefit or security under this
Indenture pursuant to Section 501 or Article Fourteen hereof, the Trustee shall
surrender an equal principal amount of Senior Note First Mortgage Bonds of the
related series to the Company for cancellation. The Trustee shall, together with
such Senior Note First Mortgage Bonds, deliver to the Company such appropriate
instruments of transfer or release as the Company may reasonably request. Prior
to the surrender required by this paragraph, the Trustee shall receive from the
Company the following, and (subject to Section 701 hereof) shall be fully
protected in relying upon, (a) an Officer's Certificate stating (i) the
aggregate outstanding principal amount of the Senior Note First Mortgage bonds
of the series surrendered by the Trustee, after giving effect to such surrender,
(ii) the aggregate Outstanding principal amount of the related series of Notes,
(iii) that the surrender of the Senior Note First Mortgage Bonds will not result
in any default under this Indenture, and (iv) that any Senior Note First
Mortgage Bonds to be received in exchange for the Senior Note First Mortgage
Bonds being surrendered comply with the provisions of this Section.
The Company shall not be permitted to cause the surrender or exchange
of all or any part of a series of Senior Note First Mortgage Bonds contemplated
in this Section, if, after such surrender or exchange, the aggregate outstanding
principal amount of the related series of Notes would exceed the aggregate
outstanding principal amount of such series of Senior Note First Mortgage Bonds
held by the Trustee. Any Senior Note First Mortgage Bonds received by the
Company pursuant to this Section 409 shall be delivered to the Mortgage Trustee
for cancellation.
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ARTICLE FIVE
SATISFACTION AND DISCHARGE
SECTION 501. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of
Notes herein expressly provided for), and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Notes theretofore authenticated and delivered (other than
(i) Notes which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 306 and (ii) Notes for whose
payment money has theretofore been deposited in trust or segregated and
held in trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 1103) have been
delivered to the Trustee for cancellation; or
(B) all such Notes 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) 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
Company,
and the Company, in the case of (i), (ii) or (iii) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for the
purpose money in an amount sufficient to pay and discharge the entire
indebtedness on such Notes not theretofore delivered to the Trustee for
cancellation, for principal and any premium and interest to the date of
such deposit (in the case of Notes which have become due and payable) or
to the Stated Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' 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 Company to the Trustee under Section 707, the obligations of
the Company to any Authenticating Agent under Section 714 and, if money shall
have been deposited with the Trustee
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pursuant to subclause (B) of Clause (1) of this Section, the obligations of the
Trustee under Section 502 and the last paragraph of Section 1103 shall survive.
If the Notes are deemed paid and discharged pursuant to this Section 501
or defeased pursuant to Article Fourteen, the obligation of the Company to make
payment with respect to the principal of and premium, if any, and interest on
the Senior Note First Mortgage Bonds shall be satisfied and discharged, as
provided in the supplemental trust indenture or indentures to the First Mortgage
creating such Senior Note First Mortgage Bonds and the Senior Note First
Mortgage Bonds shall cease to secure the Notes in any manner.
If the Company shall have paid or caused to be paid the principal of and
premium, if any, and interest on any Note, as and when the same shall have
become due and payable or the Company shall have delivered to the Trustee for
cancellation any outstanding Note, such Note shall cease to be entitled to any
lien, benefit or security under this Indenture. Upon a Note of any series
ceasing to be entitled to any lien, benefit or security under this Indenture,
the obligation of the Company to make payment with respect to principal of and
premium, if any, and interest on a principal amount of the related series of
Senior Note First Mortgage Bonds equal to the principal amount of such Note
shall be satisfied and discharged and such portion of the principal amount of
such Senior Note First Mortgage Bonds shall cease to secure the Notes in any
manner.
SECTION 502. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1103, all money
deposited with the Trustee pursuant to Section 501 shall be held in trust and
applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
ARTICLE SIX
REMEDIES
SECTION 601. Events of Default.
"Event of Default", wherever used herein with respect to Notes of any
series, 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):
(1) default in the payment of any interest upon any Note of that series
when it becomes due and payable, and continuance of such default for a period
of 60 days; or
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(2) default in the payment of the principal of or any premium on any
Note of that series at its Maturity and continuance of such default for 5
days; or
(3) default in the deposit of any sinking fund payment, when and as due
by the terms of a Note of that series and continuance of such default for 5
days; or
(4) default in the performance, or breach, of any covenant or warranty
of the Company in this Indenture (other than a covenant or warranty a default
in whose performance or whose breach is elsewhere in this Section
specifically dealt with or which has expressly been included in this
Indenture solely for the benefit of series of Notes other than that series),
and continuance of such default or breach for a period of 90 days after there
has been given, by registered or certified mail, to the Company by the
Trustee or to the Company and the Trustee by the Holders of a majority in
principal amount of the Outstanding Notes of that series a written notice
specifying such default or breach and requiring it to be remedied and stating
that such notice is a "Notice of Default" hereunder; or
(5) prior to the Release Date, a Default (as defined in the First
Mortgage) has occurred and is continuing, and the Mortgage Trustee, the
Company or Holders of at least 25% in principal amount of the outstanding
Notes shall have given written notice thereof to the Trustee;
(6) the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Company in an involuntary case
or proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in
respect of the Company under any applicable Federal or State law, or
appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator
or other similar official of the Company or of any substantial part of its
property, or ordering the winding up or liquidation of its affairs, and the
continuance of any such decree or order for relief or any such other decree
or order unstayed and in effect for a period of 90 consecutive days;
(7) the commencement by the Company of a voluntary case or proceeding
under any applicable Federal or State bankruptcy, insolvency, reorganization
or other similar law or of any other case or proceeding to be adjudicated a
bankrupt or insolvent, or the consent by it to the entry of a decree or order
for relief in respect of the Company in an involuntary case or proceeding
under any applicable Federal or State bankruptcy, insolvency, reorganization
or other similar law or to the commencement of any bankruptcy or insolvency
case or proceeding against it, or the filing by it of a petition or answer or
consent seeking reorganization or relief under any applicable Federal or
State law, or the consent by it to the filing of such petition or to the
appointment of or taking possession by a custodian, receiver, liquidator,
assignee, trustee, sequestrator or other similar official of the Company or
of any substantial part of its property, or the making by it of an assignment
for the benefit of creditors, or the admission by it in writing of its
inability to pay its debts generally as they become due, or the taking of
corporate action by the Company in furtherance of any such action; or
(8) any other Event of Default provided with respect to Notes of that
series.
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SECTION 602. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in
Section 601(6) or 601(7)) with respect to Notes of any series at the time
Outstanding occurs and is continuing, then in every such case the Trustee or the
Holders of a majority in principal amount of the Outstanding Notes of that
series may declare the principal amount of all the Notes of that series (or, if
any Notes of that series are Original Issue Discount Notes, such portion of the
principal amount of such Notes as may be specified by the terms thereof) to be
due and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by Holders), and upon any such declaration such principal
amount (or specified amount) shall become immediately due and payable. If an
Event of Default specified in Section 601(6) or 601(7) with respect to Notes of
any series at the time Outstanding occurs, the principal amount of all the Notes
of that series (or, if any Notes of that series are Original Issue Discount
Notes, such portion of the principal amount of such Notes as may be specified by
the terms thereof) shall automatically, and without any declaration or other
action on the part of the Trustee or any Holder, become immediately due and
payable. Upon such Notes becoming immediately due and payable, by declaration or
otherwise, pursuant to any of the foregoing provisions of this Section 602, the
Trustee shall immediately file with the Mortgage Trustee a written demand for
the acceleration of the payment of principal of all Senior Note First Mortgage
Bonds relating to such series of outstanding Notes pursuant to the applicable
provisions of the supplemental indenture to the First Mortgage relating to such
Senior Note First Mortgage Bonds.
At any time after such a declaration of acceleration with respect to Notes
of any series has been made and before a judgment or decree for payment of the
money due has been obtained by the Trustee as hereinafter in this Article
provided, and prior to the receipt by the Trustee from the Mortgage Trustee of
an irrevocable, valid and unconditional notice to the Trustee of the
acceleration of the payment of principal, by declaration or otherwise, of all of
the Senior Note First Mortgage Bonds relating to such series of Notes, the
related Event of Default and its consequences (including, if given, the written
demand for the acceleration of the payment of principal of all such Senior Note
First Mortgage Bonds) will be automatically waived, resulting in an automatic
rescission and annulment of the acceleration of the Notes if
(1) the Company has paid or deposited with the Trustee a sum sufficient to
pay
(A) all overdue interest on all Notes of that series,
(B) the principal of (and premium, if any, on) any Notes of that
series which have become due otherwise than by such declaration of
acceleration and any interest thereon at the rate or rates prescribed
therefor in such Notes,
(C) to the extent that payment of such interest is lawful, interest
upon overdue interest at the rate or rates prescribed therefor in such
Notes, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel;
and
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(2) all Events of Default with respect to Notes of that series, other
than the non-payment of the principal of Notes of that series which have
become due solely by such declaration of acceleration, have been cured
(including any Defaults (as defined in the First Mortgage) under the First
Mortgage, as evidenced by notice thereof received by the Trustee from the
Mortgage Trustee) or waived as provided in Section 613 or under the First
Mortgage.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 603. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any interest on any Note when
such interest becomes due and payable and such default continues for a period
of 60 days, or
(2) default is made in the payment of the principal of (or premium, if
any, on) any Note at the Maturity thereof and such default continues for a
period of 5 days,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Notes, the whole amount then due and payable on such Notes for
principal and any premium and interest and, to the extent that payment of such
interest shall be legally enforceable, interest on any overdue principal and
premium and on any overdue interest, at the rate or rates prescribed therefor in
such Notes, 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 an Event of Default with respect to Notes of any series occurs and is
continuing, the Trustee may in its discretion proceed to protect and enforce its
rights (including, prior to the Release Date, any rights that the Trustee may
have as a holder of Senior Note First Mortgage Bonds of the series relating to
the series of such Notes) and the rights of the Holders of Notes of such series
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 604. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Company (or any other
obligor upon the Notes), its property or its creditors, the Trustee shall be
entitled and empowered, by intervention in such proceeding or otherwise, to take
any and all actions authorized under the Trust Indenture Act in order to have
claims of the Holders and the Trustee (including, prior to the Release Date, any
claims of the Trustee as holder of Senior Note First Mortgage Bonds) allowed in
any such proceeding. In particular, the Trustee shall be authorized 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, seque-strator 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 the Holders, to pay to the Trustee any amount
37
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 707.
No provision of this Indenture 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 Notes 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; provided, however, that the
Trustee may, on behalf of the Holders, vote for the election of a trustee in
bankruptcy or similar official and be a member of a creditors' or other similar
committee.
SECTION 605. Trustee May Enforce Claims Without Possession of Notes.
All rights of action and claims under this Indenture or the Notes may be
prosecuted and enforced by the Trustee without the possession of any of the
Notes 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
of the Notes in respect of which such judgment has been recovered.
SECTION 606. 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 any premium
or interest, upon presentation of the Notes 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 the Trustee under Section 707;
SECOND: To the payment of the amounts then due and unpaid for principal of
and any premium and interest on the Notes 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
Notes for principal and any premium and interest, respectively; and
THIRD: To the payment of the balance, if any, to the Company or any other
Person or Persons legally entitled thereto.
SECTION 607. Limitation on Suits.
No Holder of any Note of any series 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
38
(1) such Holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to the Notes of that series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Notes of that series 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 reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee for 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 Holders of a majority in
principal amount of the Outstanding Notes of that series;
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 of
such Holders, 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 of such
Holders.
SECTION 608. Unconditional Right of Holders to Receive Principal,
Premium and Interest.
Notwithstanding any other provision in this Indenture, the Holder of any
Note shall have the right, which is absolute and unconditional, to receive
payment of the principal of and any premium and (subject to Section 307)
interest on such Note on the respective Stated Maturities expressed in such Note
(or, in the case of redemption, on the Redemption Date) 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 609. 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 Company, the Trustee and the Holders 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.
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SECTION 610. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Notes in the last paragraph of Section 306,
no right or remedy herein conferred upon or reserved to the Trustee or to the
Holders 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.
SECTION 611. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Notes 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 612. Control by Holders.
The Holders of a majority in principal amount of the Outstanding Notes of
any series 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, with respect to the Notes of such
series, provided that
(1) such direction shall not be in conflict with any rule of law or
with this Indenture,
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction, and
(3) subject to the provisions of Section 701, the Trustee shall have
the right to decline to follow any such direction if the Trustee in good
faith shall, by a Responsible Officer or Officers of the Trustee, determine
that the proceeding so directed would involve the Trustee in personal
liability.
SECTION 613. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Notes of any series may on behalf of the Holders of all the Notes of
such series waive any past default hereunder with respect to such series and its
consequences, except a default
(1) in the payment of the principal of or any premium or interest on
any Note of such series, or
40
(2) in respect of a covenant or provision hereof which under Article
Ten cannot be modified or amended without the consent of the Holder of each
Outstanding Note of such series affected.
Upon any such waiver, 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 impair any right consequent thereon.
SECTION 614. 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 against
any such party litigant, in the manner and to the extent provided in the Trust
Indenture Act; provided that neither this Section nor the Trust Indenture Act
shall be deemed to authorize any court to require such an undertaking or to make
such an assessment in any suit instituted by the Company or the Trustee.
SECTION 615. Waiver of Usury, Stay or Extension Laws.
The Company 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 usury, 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 Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not 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.
ARTICLE SEVEN
THE TRUSTEE
SECTION 701. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided by the
Trust Indenture Act, and no implied covenants or obligations shall be read into
the Indenture against the Trustee. The phrase "default (as such term is defined
in such indenture)" as it appears in Section 315 of the Trust Indenture Act
shall mean an Event of Default with respect to a series of Notes which shall
have occurred and is continuing. Notwithstanding the foregoing, no provision of
this Indenture shall require the Trustee to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
Whether or not therein expressly so provided, every provision of this Indenture
relating to the conduct or affecting the liability of or affording protection to
the Trustee shall be subject to the provisions of this Section.
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SECTION 702. Notice of Defaults.
If a default occurs hereunder with respect to Notes of any series, the
Trustee shall give the Holders of Notes of such series notice of such default
known to the Trustee as and to the extent provided by the Trust Indenture Act;
provided, however, that in the case of any default of the character specified in
Section 601(4) with respect to Notes of such series, no such notice to Holders
shall be given until at least 30 days after the occurrence thereof. For the
purpose of this Section, the term "default" means any event which is, or after
notice or lapse of time or both would become, an Event of Default with respect
to Notes of such series.
SECTION 703. Certain Rights of Trustee.
Subject to the provisions of Section 701:
(1) the Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by it to
be genuine and to have been signed or presented by the proper party or
parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order, and any
resolution of the Board of Directors shall be sufficiently evidenced by a
Board Resolution;
(3) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad faith
on its part, rely upon an Officers' Certificate;
(4) the Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(5) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction;
(6) 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, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the Company,
personally or by agent or attorney;
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(7) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys 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; and
(8) except as other provided in Section 601(4), the Trustee shall not
be charged with knowledge of any default or Event of Default unless either
(i) a Responsible Officer of the Trustee assigned to the Corporate Trust
Department of the Trustee (or any successor division or department of the
Trustee) shall have actual knowledge of the default or Event of Default, or
(ii) written notice of such default or Event of Default shall have been given
to the Trustee by the Company, any other obligor on the Notes or by any
Holder of such Notes or, in the case of an Event of Default described in
Section 601(5) by the Mortgage Trustee or Holders of at least 25% in
principal amount of the Outstanding Notes.
SECTION 704. Not Responsible for Recitals or Issuance of Notes.
The recitals contained herein and in the Notes, except the Trustee's
certificates of authentication, shall be taken as the statements of the Company,
and neither the Trustee nor any Authenticating Agent assumes any responsibility
for their correctness. The Trustee makes no representations as to the validity
or sufficiency of this Indenture or of the Notes or as to the value, title or
validity of any Senior Note First Mortgage Bonds or other securities at any time
pledged or deposited with the Trustee hereunder or as to the security offered
thereby or hereby. Neither the Trustee nor any Authenticating Agent shall be
accountable for the use or application by the Company of Notes or the proceeds
thereof or of any moneys paid to the Company under any provision hereof. The
Trustee shall not be responsible for recording or filing this Indenture, any
indenture supplemented hereto or any financing or continuation statement in any
public office or elsewhere at any time or times.
SECTION 705. May Hold Notes.
The Trustee, any Authenticating Agent, any Paying Agent, any Note
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Notes and, subject to Sections 608
and 613, may otherwise deal with the Company with the same rights it would have
if it were not Trustee, Authenticating Agent, Paying Agent, Note Registrar or
such other agent.
SECTION 706. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder except as otherwise
agreed in writing with the Company.
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SECTION 707. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time such compensation as shall
be agreed to in writing between the Company and the Trustee for all services
rendered by it hereunder (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision of
this Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Trustee for, and to hold it harmless against, any
loss, liability or expense incurred without negligence or bad faith on its
part, arising out of or in connection with the acceptance or administration
of the trust or trusts hereunder, including the costs and expenses of
defending itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder.
The Trustee shall have a lien prior to the Notes upon all property and
funds held by it hereunder for any amount owing it or any predecessor Trustee
pursuant to this Section 707, except with respect to funds held in trust for the
benefit of the Holders of particular Notes.
Without limiting any rights available to the Trustee under applicable law,
when the Trustee incurs expenses or renders services in connection with an Event
of Default specified in Section 601(6) or Section 601(7), the expenses
(including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Federal or State bankruptcy, insolvency or
other similar law.
The provisions of this Section shall survive the termination of this
Indenture.
SECTION 708. Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
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. To the extent
permitted by such Act, the Trustee shall not be deemed to have a conflicting
interest by virtue of being a trustee under this Indenture with respect to Notes
of more than one series.
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SECTION 709. Corporate Trustee Required; Eligibility.
There shall at all times be one (and only one) Trustee hereunder with
respect to the Notes of each series, which may be Trustee hereunder for Notes of
one or more other series. Each Trustee shall be a Person that is eligible
pursuant to the Trust Indenture Act to act as such and has a combined capital
and surplus of at least $50,000,000. If any such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of its
supervising or examining authority, then for the purposes of this Section and to
the extent permitted by the Trust Indenture Act, the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Trustee with respect to the Notes of any series 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 710. Resignation and Removal; Appointment of Successor.
No resignation or removal of the Trustee and no appointment of a successor
Trustee pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable
requirements of Section 711.
The Trustee may resign at any time with respect to the Notes of one or
more series by giving written notice thereof to the Company. If the instrument
of acceptance by a successor Trustee required by Section 711 shall not have been
delivered to the Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Notes of such series.
The Trustee may be removed at any time with respect to the Notes of any
series by Act of the Holders of a majority in principal amount of the
Outstanding Notes of such series, delivered to the Trustee and to the Company.
If at any time:
(1) the Trustee shall fail to comply with Section 708 after written
request therefor by the Company or by any Holder who has been a bona fide
Holder of a Note for at least six months, or
(2) the Trustee shall cease to be eligible under Section 709 and shall
fail to resign after written request therefor by the Company or by any such
Holder, or
(3) the Trustee shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver 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, (A) the Company by a Board Resolution may remove the
Trustee with respect to all Notes, or (B) subject to Section 614, any Holder who
has been a bona
45
fide Holder of a Note for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee with respect to all Notes and the appointment of a
successor Trustee or Trustees.
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, with respect to
the Notes of one or more series, the Company, by a Board Resolution, shall
promptly appoint a successor Trustee or Trustees with respect to the Notes of
that or those series (it being understood that any such successor Trustee may be
appointed with respect to the Notes of one or more or all of such series and
that at any time there shall be only one Trustee with respect to the Notes of
any particular series) and shall comply with the applicable requirements of
Section 711. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Trustee with
respect to the Notes of any series shall be appointed by Act of the Holders of a
majority in principal amount of the Outstanding Notes of such series delivered
to the Company and the retiring Trustee, the successor Trustee so appointed
shall, forthwith upon its acceptance of such appointment in accordance with the
applicable requirements of Section 711, become the successor Trustee with
respect to the Notes of such series and to that extent supersede the successor
Trustee appointed by the Company. If no successor Trustee with respect to the
Notes of any series shall have been so appointed by the Company or the Holders
and accepted appointment in the manner required by Section 711, any Holder who
has been a bona fide Holder of a Note of such series for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the appointment of a successor Trustee with
respect to the Notes of such series.
The Company shall give notice of each resignation and each removal of the
Trustee with respect to the Notes of any series and each appointment of a
successor Trustee with respect to the Notes of any series to all Holders of
Notes of such series in the manner provided in Section 106. Each notice shall
include the name of the successor Trustee with respect to the Notes of such
series and the address of its Corporate Trust Office.
SECTION 711. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee with respect
to all Notes, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company 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, including rights, title and
interest in the Senior Note First Mortgage Bonds; but, on the request of the
Company 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, 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.
In case of the appointment hereunder of a successor Trustee with respect
to the Notes of one or more (but not all) series, the Company, the retiring
Trustee and each successor Trustee with respect to the Notes of one or more
series shall execute and deliver an
46
indenture supplemental hereto wherein each successor Trustee shall accept such
appointment and which (1) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, each successor Trustee all
the rights, powers, trusts and duties of the retiring Trustee with respect to
the Notes of that or those series to which the appointment of such successor
Trustee relates, (2) if the retiring Trustee is not retiring with respect to all
Notes, shall contain such provisions as shall be deemed necessary or desirable
to confirm that all the rights, powers, trusts and duties of the retiring
Trustee with respect to the Notes of that or those series as to which the
retiring Trustee is not retiring shall continue to be vested in the retiring
Trustee, and (3) shall add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of the
trusts hereunder by more than one Trustee, it being understood that nothing
herein or in such supplemental indenture shall constitute such Trustees
co-trustees of the same trust and that each such Trustee shall be trustee of a
trust or trusts hereunder separate and apart from any trust or trusts hereunder
administered by any other such Trustee; and upon the execution and delivery of
such supplemental indenture the resignation or removal of the retiring Trustee
shall become effective to the extent provided therein and each 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 with respect
to the Notes of that or those series to which the appointment of such successor
Trustee relates; but, on request of the Company or any successor Trustee, such
retiring Trustee shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder with
respect to the Notes of that or those series to which the appointment of such
successor Trustee relates.
Upon request of any such successor Trustee, the Company shall execute any
and all instruments for more fully and certainly vesting in and confirming to
such successor Trustee all such rights, powers and trusts referred to in the
first or second preceding paragraph, as the case may be.
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 712. 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 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 Notes 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 Notes so authenticated with the same effect as if
such successor Trustee had itself authenticated such Notes.
47
SECTION 713. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company (or
any other obligor upon the Notes), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
SECTION 714. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with respect to
one or more series of Notes which shall be authorized to act on behalf of the
Trustee to authenticate Notes of such series issued upon exchange, registration
of transfer or partial redemption thereof or pursuant to Section 306, and Notes
so authenticated shall be entitled to the benefits of this Indenture and shall
be valid and obligatory for all purposes as if authenticated by the Trustee
hereunder. Wherever reference is made in this Indenture to the authentication
and delivery of Notes by the Trustee or the Trustee's certificate of
authentication, such reference shall be deemed to include authentication and
delivery on behalf of the Trustee by an Authenticating Agent and a certificate
of authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Company and shall at all
times be a corporation organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia, authorized
under such laws to act as Authenticating Agent, having a combined capital and
surplus of not less than $50,000,000 and subject to supervision or examination
by Federal or State authority. If such Authenticating Agent publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Authenticating Agent shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section, such Authenticating
Agent shall resign immediately in the manner and with the effect specified in
this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give notice of such
appointment in the manner provided in Section 106 to all Holders of Notes of the
series with respect to which such Authenticating Agent will serve. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its
48
predecessor hereunder, with like effect as if originally named as an
Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provisions of this Section.
The Company agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section.
If an appointment with respect to one or more series is made pursuant to
this Section, the Notes of such series may have endorsed thereon, in addition to
the Trustee's certificate of authentication, an alternative certificate of
authentication in the following form:
This is one of the Notes of the series designated therein referred to in
the within-mentioned Indenture.
THE BANK OF NEW YORK,
As Trustee
By............................
As Authenticating Agent
By............................
Authorized Officer
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ARTICLE EIGHT
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 801. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee
(1) fifteen days after each Regular Record Date, a list, in such form
as the Trustee may reasonably require, of the names and addresses of the
Holders of Notes of each series as of such Regular Record Date, and
(2) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the time
such list is furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Note Registrar.
SECTION 802. Preservation of Information; Communications to Holders.
The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 801 and the names and
addresses of Holders received by the Trustee in its capacity as Note Registrar.
The Trustee may destroy any list furnished to it as provided in Section 801 upon
receipt of a new list so furnished.
The rights of Holders to communicate with other Holders with respect to
their rights under this Indenture or under the Notes, and the corresponding
rights and privileges of the Trustee, shall be as provided by the Trust
Indenture Act.
Every Holder of Notes, by receiving and holding the same, agrees with the
Company and the Trustee that neither the Company nor the Trustee nor any agent
of either of them shall be held accountable by reason of any disclosure of
information as to names and addresses of Holders made pursuant to the Trust
Indenture Act.
SECTION 803. Reports by Trustee.
The Trustee shall transmit to Holders such reports concerning the Trustee
and its actions under this Indenture as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant thereto. If
required by Section 313(a) of the Trust Indenture Act, the Trustee shall, within
sixty days after each May 15 following the date of this Indenture deliver to
Holders a brief report, dated as of such May 15, which complies with the
provisions of such Section 313(a).
50
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 any Notes
are listed, with the Commission and with the Company. The Company will promptly
notify the Trustee when any Notes are listed on any stock exchange.
SECTION 804. Reports by Company.
The Company shall file with the Trustee and the Commission, and transmit
to Holders, such information, documents and other reports, and such summaries
thereof, as may be required pursuant to the Trust Indenture Act at the times and
in the manner provided pursuant to such Act; provided that any such information,
documents or reports required to be filed with the Commission pursuant to
Section 13 or 15(d) of the Exchange Act shall be filed with the Trustee within
15 days after the same is so required to be filed with the Commission.
ARTICLE NINE
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 901. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person or
convey, transfer or lease its properties and assets substantially as an entirety
to any Person, and the Company shall not permit any Person to consolidate with
or merge into the Company or convey, transfer or lease its properties and assets
substantially as an entirety to the Company, unless:
(1) in case the Company shall consolidate with or merge into another
Person or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, the Person formed by such consolidation or into
which the Company is merged or the Person which acquires by conveyance or
transfer, or which leases, the properties and assets of the Company
substantially as an entirety shall be a corporation, partnership,
unincorporated organization or trust, shall be organized and validly existing
under the laws of the United States of America, any State thereof or the
District of Columbia and (a) shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the principal of
and any premium and interest on all the Notes and the performance or
observance of every covenant of this Indenture on the part of the Company to
be performed or observed (b) if such consolidation, merger, conveyance,
transfer, or lease occurs prior to the Release Date, shall expressly assume,
by an indenture supplemental to the First Mortgage, executed and delivered to
the Trustee and the Mortgage Trustee, in form satisfactory to the Trustee and
the Mortgage Trustee, the due and punctual payment of the principal of and
any premium and interest on all of the Senior Note First Mortgage Bonds and
the performance of every covenant of the First Mortgage on the part of the
Company to be performed or observed. For purposes of this Article Nine, the
phrase "assets substantially as an entirety" shall mean 50% or more of the
total assets of the
51
Company as shown on the consolidated balance sheet of the Company as of
the end of the calendar year immediately preceding the day of the year in
which such determination is made and nothing in this Indenture shall prevent
or hinder the Company from conveying, transferring or leasing during any
calendar year (in one transaction or a series of transactions) less than 50%
of the amount of its total assets as shown on the consolidated balance sheet
of the Company as of the end of the immediately preceding calendar year;
(2) immediately after giving effect to such transaction and treating
any indebtedness which becomes an obligation of the Company or any Subsidiary
as a result of such transaction as having been incurred by the Company or
such Subsidiary at the time of such transaction, no Event of Default, and no
event which, after notice or lapse of time or both, would become an Event of
Default, shall have happened and be continuing;
(3) if, as a result of any such consolidation or merger or such
conveyance, transfer or lease, properties or assets of the Company would
become subject to a mortgage, pledge, lien, security interest or other
encumbrance which would not be permitted by this Indenture, the Company or
such successor Person, as the case may be, shall take such steps as shall be
necessary effectively to secure the Notes equally and ratably with (or prior
to) all indebtedness secured thereby; and
(4) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such consolidation, merger,
conveyance, transfer or lease and, if a supplemental indenture is required in
connection with such transaction, such supplemental indenture comply with
this Article and that all conditions precedent herein provided for relating
to such transaction have been complied with.
SECTION 902. Successor Substituted.
Upon any consolidation of the Company with, or merger of the Company into,
any other Person or any conveyance, transfer or lease of the properties and
assets of the Company substantially as an entirety in accordance with Section
901, the successor Person formed by such consolidation or into which the Company
is merged or to which such conveyance, transfer or lease is made shall succeed
to, and be substituted for, and may exercise every right and power of, the
Company under this Indenture with the same effect as if such successor Person
had been named as the Company herein, and thereafter, except in the case of a
lease, the predecessor Person shall be relieved of all obligations and covenants
under this Indenture and the Notes.
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ARTICLE TEN
SUPPLEMENTAL INDENTURES
SECTION 1001. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Company and the
assumption by any such successor of the covenants of the Company herein and
in the Notes; or
(2) to add to the covenants of the Company for the benefit of the
Holders of all or any series of Notes (and if such covenants are to be for
the benefit of less than all series of Notes, stating that such covenants are
expressly being included solely for the benefit of such series) or to
surrender any right or power herein conferred upon the Company; or
(3) to add any additional Events of Default for the benefit of the
Holders of all or any series of Notes (and if such additional Events of
Default are to be for the benefit of less than all series of Notes, stating
that such additional Events of Default are expressly being included solely
for the benefit of such series); or
(4) to add to or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of Notes in
bearer form, registrable or not registrable as to principal, and with or
without interest coupons, or to permit or facilitate the issuance of Notes in
uncertificated form; or
(5) to add to, change or eliminate any of the provisions of this
Indenture in respect of one or more series of Notes, provided that any such
addition, change or elimination (A) shall neither (i) apply to any Note of
any series created prior to the execution of such supplemental indenture and
entitled to the benefit of such provision nor (ii) modify the rights of the
Holder of any such Note with respect to such provision or (B) shall become
effective only when there is no such Note Outstanding; or
(6) to secure the Notes; or
(7) to establish the form or terms of Notes of any series as permitted
by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment hereunder
by a successor Trustee with respect to the Notes of one or more series and to
add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, pursuant to the requirements of Section
711; or
53
(9) to cure any ambiguity, to correct or supplement any provision
herein which may be defective or inconsistent with any other provision
herein, or to make any other provisions with respect to matters or questions
arising under this Indenture, provided that such action pursuant to this
Clause (9) shall not adversely affect the interests of the Holders of Notes
of any series in any material respect.
SECTION 1002. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of a majority in principal amount of the
Outstanding Notes of each series affected by such supplemental indenture, by Act
of said Holders delivered to the Company and the Trustee, the Company, when
authorized by a Board Resolution, and the Trustee may enter into an indenture or
indentures supplemental hereto for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Indenture or
of modifying in any manner the rights of the Holders of Notes of such series
under this Indenture; provided, however, that no such supplemental indenture
shall, without the consent of the Holder of each Outstanding Note affected
thereby,
(1) change the Stated Maturity of the principal of, or any instalment
of principal of or interest on, any Note, or reduce the principal amount
thereof or the rate of interest thereon or any premium payable upon the
redemption thereof, or reduce the amount of the principal of an Original
Issue Discount Note or any other Note which would be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section 602,
or change any Place of Payment where, or the coin or currency in which, any
Note or any premium or interest thereon is payable, or impair the interest
hereunder of the Trustee in the Senior Note First Mortgage Bonds, or impair
the right to institute suit for the enforcement of any such payment on or
after the Stated Maturity thereof (or, in the case of redemption, on or after
the Redemption Date), or prior to the Release Date, impair the interest
hereunder of the Trustee in the Senior Note First Mortgage Bonds, reduce the
principal amount of any series of Senior Note First Mortgage Bonds to an
amount less than the principal amount of the related series of Notes or alter
the payment provisions of such Senior Note First Mortgage Bonds in a manner
adverse to the Holders of the Notes, or
(2) reduce the percentage in principal amount of the Outstanding Notes
of any series, the consent of whose Holders is required for any such
supplemental indenture, or the consent of whose Holders is required for any
waiver (of compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences) provided for in this Indenture, or
(3) modify any of the provisions of this Section, Section 613 or
Section 1108, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Note affected thereby;
provided, however, that this clause shall not be deemed to require the
consent of any Holder with respect to changes in the references to "the
Trustee" and concomitant changes in this Section and Section 1108, or the
deletion of this proviso, in accordance with the requirements of Sections 711
and 1001(8).
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A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Notes, or which modifies the rights
of the Holders of Notes of such series with respect to such covenant or other
provision, shall be deemed not to affect the rights under this Indenture of the
Holders of Notes of any other series.
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
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 (subject to Section 701) 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.
SECTION 1004. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Notes 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.
SECTION 1006. Reference in Notes to Supplemental Indentures.
Notes of any series 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 Company shall so determine,
new Notes of any series so modified as to conform, in the opinion of the Trustee
and the Company, to any such supplemental indenture may be prepared and executed
by the Company and authenticated and delivered by the Trustee in exchange for
Outstanding Notes of such series.
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ARTICLE ELEVEN
COVENANTS
SECTION 1101. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of Notes
that it will duly and punctually pay the principal of and any premium and
interest on the Notes of that series in accordance with the terms of the Notes
and this Indenture.
SECTION 1102. Maintenance of Office or Agency.
The Company will maintain in each Place of Payment for any series of Notes
an office or agency where Notes of that series may be presented or surrendered
for payment, where Notes of that series may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Company in
respect of the Notes of that series and this Indenture may be served. The
Company 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 Company
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 Trust Office of the
Trustee, and the Company hereby appoints the Trustee as its agent to receive all
such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other offices
or agencies where the Notes of one or more series may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an office or agency
in each Place of Payment for Notes of any series for such purposes. The Company
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. Money for Notes Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with respect
to any series of Notes, it will, on or before each due date of the principal of
or any premium or interest on any of the Notes of that series, segregate and
hold in trust for the benefit of the Persons entitled thereto a sum sufficient
to pay the principal and any premium and interest so becoming due until such
sums shall be paid to such Persons or otherwise disposed of as herein provided
and will promptly notify the Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents for any series
of Notes, it will, prior to each due date of the principal of or any premium or
interest on any Notes of that series, deposit with a Paying Agent a sum
sufficient to pay such amount, such sum
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to be held as provided by the Trust Indenture Act, and (unless such Paying Agent
is the Trustee) the Company will promptly notify the Trustee of its action or
failure so to act.
The Company will cause each Paying Agent for any series of Notes other
than the Trustee to execute and deliver to the Trustee an instrument in which
such Paying Agent shall agree with the Trustee, subject to the provisions of
this Section, that such Paying Agent will (1) comply with the provisions of the
Trust Indenture Act applicable to it as a Paying Agent and (2) during the
continuance of any default by the Company (or any other obligor upon the Notes
of that series) in the making of any payment in respect of the Notes of that
series, upon the written request of the Trustee, forthwith pay to the Trustee
all sums held in trust by such Paying Agent for payment in respect of the Notes
of that series.
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of or any premium or
interest on any Note of any series and remaining unclaimed for two years after
such principal, premium or interest has become due and payable shall be paid to
the Company on Company Request, or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall thereafter, as an
unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the Borough of
Manhattan, The City of New York, New York, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than
30 days from the date of such publication, any unclaimed balance of such money
then remaining will be repaid to the Company.
SECTION 1104. Statement by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after the end of
each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and, if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.
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SECTION 1105. Recording, Filing, etc.; Opinions of Counsel.
The Company will cause this Indenture, any indentures supplemental to this
Indenture, and any financing or continuation statements to be promptly recorded
and filed and rerecorded and refiled in such a manner and in such places, as may
be required by law in order fully to preserve, protect and perfect the security
of the Holders and all rights of the Trustee, and shall deliver to the Trustee:
(a) promptly after the execution and delivery of this Indenture and of any
indenture supplemental to this Indenture but prior to the Release Date, an
Opinion of Counsel either stating that, in the opinion of such counsel, this
Indenture or such supplemental indenture and any financing or continuation
statements have been properly recorded and filed so as to make effective and to
perfect the security interest of the Trustee intended to be created by this
Indenture for the benefit of the Holders from time to time in the Senior Note
First Mortgage Bonds, and reciting the details of such action, or stating that,
in the opinion of such counsel, no such action is necessary to perfect or make
such security interest effective and stating what, if any, action of the
foregoing character may reasonably be expected to become necessary prior to the
next succeeding November 1 to maintain, perfect and make such security interest
effective; and
(b) on or before November 1 of each year, beginning in 1997, and
prior to the Release Date, an Opinion of Counsel either stating that in the
opinion of such counsel such action has been taken, since the date of the most
recent Opinion of Counsel furnished pursuant to this Section 1105(b) or the
first Opinion of Counsel furnished pursuant to Section 1105(a), with respect to
the recording, filing, rerecording, or refiling of this Indenture, each
supplemental indenture and any financing or continuation statements, as is
necessary to maintain and perfect the security interest of the Trustee intended
to be created by this Indenture for the benefit of the Holders from time to time
of the Notes in the Senior Note First Mortgage Bonds, and reciting the details
of such action, or stating that in the opinion of such counsel no such action is
necessary to maintain and perfect such security interest and stating what, if
any, action of the foregoing character may reasonably be expected to become
necessary prior to the next succeeding November 1 to maintain, perfect and make
such security interest effective.
SECTION 1106. Existence.
Subject to Article Nine, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its existence,
rights (charter and statutory) and corporate franchises; provided, however, that
the Company shall not be required to preserve any such right or franchise if the
Board of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and that the loss
thereof is not disadvantageous in any material respect to the Holders.
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SECTION 1107. Maintenance of Properties.
Subject to Article Nine, the Company will cause all properties used or
useful in the conduct of its business or the business of any Subsidiary to be
maintained and kept in good condition, repair and working order and supplied
with all necessary equipment and will cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in the
judgment of the Company may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all times;
provided, however, that nothing in this Section shall prevent the Company from
discontinuing the operation or maintenance of any of such properties if such
discontinuance is, in the judgment of the Company, desirable in the conduct of
its business or the business of any Subsidiary and not disadvantageous in any
material respect to the Holders.
SECTION 1108. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary or
upon the income, profits or property of the Company or any Subsidiary, and (2)
all lawful claims for labor, materials and supplies which, if unpaid, might by
law become a lien upon the property of the Company or any Subsidiary; provided,
however, that the Company shall not be required to pay or discharge or cause to
be paid or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings.
SECTION 1109. Waiver of Certain Covenants.
Except as otherwise specified as contemplated by Section 301 for Notes of
such series, the Company may, with respect to the Notes of any series, omit in
any particular instance to comply with any term, provision or condition set
forth in any covenant provided pursuant to Section 301(20), 1001(2) or 1001(7)
for the benefit of the Holders of such series or in any of Sections 1107 through
1108 if before the time for such compliance the Holders of a majority in
principal amount of the Outstanding Notes of such series shall, by Act of such
Holders, either waive such compliance in such instance or generally waive
compliance with such term, provision or condition, but no such waiver shall
extend to or affect such term, provision or condition except to the extent so
expressly waived, and, until such waiver shall become effective, the obligations
of the Company and the duties of the Trustee in respect of any such term,
provision or condition shall remain in full force and effect.
SECTION 1110. Calculation of Original Issue Discount.
The Company shall file with the Trustee promptly at the end of each calendar
year a written notice specifying the amount of original issue discount
(including daily rates and accrual periods) accrued on Outstanding Notes as of
the end of such year.
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ARTICLE TWELVE
REDEMPTION OF NOTES
SECTION 1201. Applicability of Article.
Notes of any series which are redeemable before their Stated Maturity
shall be redeemable in accordance with their terms and (except as otherwise
specified as contemplated by Section 301 for such Notes) in accordance with this
Article.
SECTION 1202. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Notes shall be evidenced by a
Board Resolution or in another manner specified as contemplated by Section 301
for such Notes. In case of any redemption at the election of the Company, the
Company shall, at least 60 days prior to the Redemption Date fixed by the
Company (unless a shorter notice shall be satisfactory to the Trustee), notify
the Trustee of such Redemption Date, of the principal amount of Notes of such
series to be redeemed and, if applicable, of the tenor of the Notes to be
redeemed. In the case of any redemption of Notes (a) prior to the expiration of
any restriction on such redemption provided in the terms of such Notes or
elsewhere in this Indenture, or (b) pursuant to an election of the Company which
is subject to a condition specified in the terms of such Notes or elsewhere in
this Indenture, the Company shall furnish the Trustee with an Officers'
Certificate evidencing compliance with such restriction or condition.
SECTION 1203. Selection by Trustee of Notes to Be Redeemed.
If less than all the Notes of any series are to be redeemed (unless all
the Notes of such series and of a specified tenor are to be redeemed or unless
such redemption affects only a single Note), the particular Notes to be redeemed
shall be selected not more than 60 days prior to the Redemption Date by the
Trustee, from the Outstanding Notes of such series 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 a portion of the principal
amount of any Note of such series, provided that the unredeemed portion of the
principal amount of any Note shall be in an authorized denomination (which shall
not be less than the minimum authorized denomination) for such Note. If less
than all the Notes of such series and of a specified tenor are to be redeemed
(unless such redemption affects only a single Note), the particular Notes to be
redeemed shall be selected not more than 60 days prior to the Redemption Date by
the Trustee, from the Outstanding Notes of such series and specified tenor not
previously called for redemption in accordance with the preceding sentence.
The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption as aforesaid and, in case of any Notes selected for
partial redemption as aforesaid, the principal amount thereof to be redeemed.
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The provisions of the two preceding paragraphs shall not apply with
respect to any redemption affecting only a single Note, whether such Note is to
be redeemed in whole or in part. In the case of any such redemption in part, the
unredeemed portion of the principal amount of the Note shall be in an authorized
denomination (which shall not be less than the minimum authorized denomination)
for such Note.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Notes shall relate, in the case of
any Notes redeemed or to be redeemed only in part, to the portion of the
principal amount of such Notes which has been or is to be redeemed.
SECTION 1204. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage prepaid,
mailed not less than 30 nor more than 60 days prior to the Redemption Date, to
each Holder of Notes to be redeemed, at his address appearing in the Note
Register.
All notices of redemption shall identify the Notes to be redeemed
(including CUSIP number) and shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Notes of any series and of a
specified tenor consisting of more than a single Note are to be redeemed, the
identification (and, in the case of partial redemption of any such Notes, the
principal amounts) of the particular Notes to be redeemed and, if less than
all the Outstanding Notes of any series and of a specified tenor consisting
of a single Note are to be redeemed, the principal amount of the particular
Note to be redeemed,
(4) that on the Redemption Date the Redemption Price will become due and
payable upon each such Note to be redeemed and, if applicable, that interest
thereon will cease to accrue on and after said date,
(5) the place or places where each such Note is to be surrendered for
payment of the Redemption Price, and
(6) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Notes to be redeemed at the election of the
Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company and shall be
irrevocable.
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SECTION 1205. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit with the Trustee
or with a Paying Agent (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 1103) an amount of money
sufficient to pay the Redemption Price of, and (except if the Redemption Date
shall be an Interest Payment Date) accrued interest on, all the Notes which are
to be redeemed on that date.
SECTION 1206. Notes Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Notes so to be
redeemed shall, on the Redemption Date, become due and payable at the Redemption
Price therein specified, and from and after such date (unless the Company shall
default in the payment of the Redemption Price and accrued interest) such Notes
shall cease to bear interest. Upon surrender of any such Note for redemption in
accordance with said notice, such Note shall be paid by the Company at the
Redemption Price, together with accrued interest to the Redemption Date;
provided, however, that, unless otherwise specified as contemplated by Section
301, installments of interest whose Stated Maturity is on or prior to the
Redemption Date will be payable to the Holders of such Notes, or one or more
Predecessor Notes, registered as such at the close of business on the relevant
Record Dates according to their terms and the provisions of Section 307.
If any Note called for redemption shall not be so paid upon surrender
thereof for redemption, the principal and any premium shall, until paid, bear
interest from the Redemption Date at the rate prescribed therefor in the Note.
SECTION 1207. Notes Redeemed in Part.
Any Note which is to be redeemed only in part shall be surrendered at a
Place of Payment therefor (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and deliver to the Holder of such Note without service
charge, a new Note or Notes of the same series and of like tenor, 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 Note so surrendered.
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ARTICLE THIRTEEN
SINKING FUNDS
SECTION 1301. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund for
the retirement of Notes of any series except as otherwise specified as
contemplated by Section 301 for such Notes.
The minimum amount of any sinking fund payment provided for by the terms
of any Notes is herein referred to as a "mandatory sinking fund payment", and
any payment in excess of such minimum amount provided for by the terms of such
Notes is herein referred to as an "optional sinking fund payment". If provided
for by the terms of any Notes, the cash amount of any sinking fund payment may
be subject to reduction as provided in Section 1302. Each sinking fund payment
shall be applied to the redemption of Notes as provided for by the terms of such
Notes.
SECTION 1302. Satisfaction of Sinking Fund Payments with Notes.
The Company (1) may deliver Outstanding Notes of a series (other than any
previously called for redemption) and (2) may apply as a credit Notes of a
series which have been redeemed either at the election of the Company pursuant
to the terms of such Notes or through the application of permitted optional
sinking fund payments pursuant to the terms of such Notes, in each case in
satisfaction of all or any part of any sinking fund payment with respect to any
Notes of such series required to be made pursuant to the terms of such Notes as
and to the extent provided for by the terms of such Notes; provided that the
Notes to be so credited have not been previously so credited. The Notes to be so
credited shall be received and credited for such purpose by the Trustee at the
Redemption Price, as specified in the Notes so to be redeemed, for redemption
through operation of the sinking fund and the amount of such sinking fund
payment shall be reduced accordingly.
SECTION 1303. Redemption of Notes for Sinking Fund.
Not less than 60 days prior to each sinking fund payment date for any
Notes, the Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for such Notes
pursuant to the terms of such Notes, the portion thereof, if any, which is to be
satisfied by payment of cash and the portion thereof, if any, which is to be
satisfied by delivering and crediting Notes pursuant to Section 1302 and stating
the basis for such credit and that such Notes have not been previously so
credited and will also deliver to the Trustee any Notes to be so delivered. Not
less than 30 days prior to each such sinking fund payment date, the Trustee
shall select the Notes to be redeemed upon such sinking fund payment date in the
manner specified in Section 1203 and cause notice of the redemption thereof to
be given in the name of and at the expense of the Company in the manner provided
in Section 1204. Such notice having been duly given, the
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redemption of such Notes shall be made upon the terms and in the manner stated
in Sections 1206 and 1207.
ARTICLE FOURTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1401. Company's Option to Effect Defeasance or Covenant Defeasance.
The Company may elect, at its option at any time, to have Section 1402 or
Section 1403 applied to any Notes or any series of Notes, as the case may be,
designated pursuant to Section 301 as being defeasible pursuant to such Section
1402 or 1403, in accordance with any applicable requirements provided pursuant
to Section 301 and upon compliance with the conditions set forth below in this
Article. Any such election shall be evidenced by a Board Resolution or in
another manner specified as contemplated by Section 301 for such Notes.
SECTION 1402. Defeasance and Discharge.
Upon the Company's exercise of its option (if any) to have this Section
applied to any Notes or any series of Notes, as the case may be, the Company
shall be deemed to have been discharged from its obligations with respect to
such Notes as provided in this Section on and after the date the conditions set
forth in Section 1404 are satisfied (hereinafter called "Defeasance") and the
obligation of the Company to make payment with respect to the principal of and
premium, if may, and interest on the Senior Notes First Mortgage Bonds shall be
satisfied and discharged, as provided in the supplemental trust indenture or
indentures to the First Mortgage creating such Senior Note First Mortgage Bonds
and the Senior Note First Mortgage Bonds shall cease to secure the Notes in any
manner. For this purpose, such Defeasance means that the Company shall be deemed
to have paid and discharged the entire indebtedness represented by such Notes
and to have satisfied all its other obligations under such Notes and this
Indenture insofar as such Notes are concerned (and the Trustee, at the expense
of the Company, shall execute proper instruments acknowledging the same),
subject to the following which shall survive until otherwise terminated or
discharged hereunder: (1) the rights of Holders of such Notes 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 any premium and
interest on such Notes when payments are due, (2) the Company's obligations with
respect to such Notes under Sections 304, 305, 306, 1102 and 1103 and with
respect to the Trustee under Section 707, (3) the rights, powers, trusts, duties
and immunities of the Trustee hereunder and (4) this Article. Subject to
compliance with this Article, the Company may exercise its option (if any) to
have this Section applied to any Notes notwithstanding the prior exercise of its
option (if any) to have Section 1403 applied to such Notes.
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SECTION 1403. Covenant Defeasance.
Upon the Company's exercise of its option (if any) to have this Section
applied to any Notes or any series of Notes, as the case may be, (1) the Company
shall be released from its obligations under Section 901(3), Sections 1107
through 1108, inclusive, and any covenants provided pursuant to Section 301(20),
1001(2), 1001(6) or 1001(7) and 601(8) for the benefit of the Holders of such
Notes and (2) the occurrence of any event specified in Sections 601(4) (with
respect to any of Section 901(3), Sections 1107 through 1108, inclusive, and any
such covenants provided pursuant to Section 301(20), 1001(2), 1001(6) or
1001(7)) and 601(8) shall be deemed not to be or result in an Event of Default
with respect to such Notes as provided in this Section on and after the date the
conditions set forth in Section 1404 are satisfied (hereinafter called "Covenant
Defeasance"). For this purpose, such Covenant Defeasance means that, with
respect to such Notes, the Company may omit to comply with and shall have no
liability in respect of any term, condition or limitation set forth in any such
specified Section (to the extent so specified in the case of Section 601(4)),
whether directly or indirectly by reason of any reference elsewhere herein to
any such Section or by reason of any reference in any such Section to any other
provision herein or in any other document, but the remainder of this Indenture
and such Notes shall be unaffected thereby.
SECTION 1404. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of Section 1402
or Section 1403 to any Notes or any series of Notes, as the case may be:
(1) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee 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 of such Notes, (A) money in an amount,
or (B) U.S. Government Obligations which through the scheduled payment of
principal and interest in respect thereof in accordance with their terms will
provide, not later than one day before the due date of any payment, money in
an amount, or (C) a combination thereof, in each case sufficient, in the
opinion of a nationally 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 to pay and
discharge, the principal of and any premium and interest on such Notes on the
respective Stated Maturities or on any Redemption Date established pursuant
to clause (9) below, in accordance with the terms of this Indenture and such
Notes. As used herein, "U.S. Government Obligation" means (x) any security
which is (i) a direct obligation of the United States of America for the
payment of which the full faith and credit of the United States of America is
pledged or (ii) an obligation of a Person controlled or supervised by and
acting as an agency or instrumentality of the United States of America the
payment of which is unconditionally guaranteed as a full faith and credit
obligation by the United States of America, which, in either case (i) or
(ii), is not callable or redeemable at the option of the issuer thereof, and
(y) any depositary receipt issued by a bank (as defined in Section 3(a)(2) of
the Notes Act) as custodian with respect to any U.S. Government Obligation
which is specified in Clause (x) above and held by such bank for the account
of the holder of such depositary receipt, or with respect to any specific
payment of principal of or interest on any U.S.
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Government Obligation which is so specified and held, provided that
(except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depositary receipt
from any amount received by the custodian in respect of the U.S. Government
Obligation or the specific payment of principal or interest evidenced by such
depositary receipt.
(2) In the event of an election to have Section 1402 apply to any Notes
or any series of Notes, as the case may be, the Company shall have delivered
to the Trustee an Opinion of Counsel stating that (A) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (B) since the date of this instrument, there has been a change in
the applicable Federal income tax law, in either case (A) or (B) to the
effect that, and based thereon such opinion shall confirm that, the Holders
of such Notes will not recognize gain or loss for Federal income tax purposes
as a result of the deposit, Defeasance and discharge to be effected with
respect to such Notes and will be subject to Federal income tax on the same
amount, in the same manner and at the same times as would be the case if such
deposit, Defeasance and discharge were not to occur.
(3) In the event of an election to have Section 1403 apply to any Notes
or any series of Notes, as the case may be, the Company shall have delivered
to the Trustee an Opinion of Counsel to the effect that the Holders of such
Notes will not recognize gain or loss for Federal income tax purposes as a
result of the deposit and Covenant Defeasance to be effected with respect to
such Notes and will be subject to Federal income tax on the same amount, in
the same manner and at the same times as would be the case if such deposit
and Covenant Defeasance were not to occur.
(4) The Company shall have delivered to the Trustee an Officers'
Certificate to the effect that neither such Notes nor any other Notes of the
same series, if then listed on any securities exchange, will be delisted as a
result of such deposit.
(5) No event which is, or after notice or lapse of time or both would
become, an Event of Default with respect to such Notes or any other Notes
shall have occurred and be continuing at the time of such deposit or, with
regard to any such event specified in Sections 601(6) and (7), at any time on
or prior to the 90th day after the date of such deposit (it being understood
that this condition shall not be deemed satisfied until after such 90th day).
(6) Such Defeasance or Covenant Defeasance shall not cause the Trustee
to have a conflicting interest within the meaning of the Trust Indenture Act
(assuming all Notes are in default within the meaning of such Act).
(7) Such Defeasance or Covenant Defeasance shall not result in a breach
or violation of, or constitute a default under, any other agreement or
instrument to which the Company is a party or by which it is bound.
(8) Such Defeasance or Covenant Defeasance shall not result in the
trust arising from such deposit constituting an investment company within the
meaning of the Investment Company Act unless such trust shall be registered
under such Act or exempt from registration thereunder.
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(9) If the Notes are to be redeemed prior to Stated Maturity (other
than from mandatory sinking fund payments or analogous payments), notice of
such redemption shall have been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee shall have been made.
(10) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent with respect to such Defeasance or Covenant Defeasance have been
complied with.
SECTION 1405. Deposited Money and U.S. Government Obligations to Be
Held in Trust; Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1103, all money
and U.S. Government Obligations (including the proceeds thereof) deposited with
the Trustee pursuant to Section 1404 in respect of any Notes shall be held in
trust and applied by the Trustee, in accordance with the provisions of such
Notes and this Indenture, to the payment, either directly or through any such
Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Holders of such Notes, of all sums due and to
become due thereon in respect of principal and any premium and interest, but
money so held in trust need not be segregated from other funds except to the
extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 1404 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of Outstanding Notes.
Anything in this Article to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon Company Request any
money or U.S. Government Obligations held by it as provided in Section 1404 with
respect to any Notes which, in the opinion of a nationally 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 the Defeasance or Covenant Defeasance, as
the case may be, with respect to such Notes.
SECTION 1406. Reinstatement.
If the Trustee or the Paying Agent is unable to apply any money in
accordance with this Article with respect to any Notes by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, then the obligations under this
Indenture and such Notes from which the Company has been discharged or released
pursuant to Section 1402 or 1403 shall be revived and reinstated as though no
deposit had occurred pursuant to this Article with respect to such Notes, until
such time as the Trustee or Paying Agent is permitted to apply all money held in
trust pursuant to Section 1405 with respect to such Notes in accordance with
this Article; provided, however, that if the Company makes any payment of
principal of or any premium or interest on any such Note following such
reinstatement of its obligations, the Company
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shall be subrogated to the rights (if any) of the Holders of such Notes to
receive such payment from the money so held in trust.
-----------------------------
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
ARIZONA PUBLIC SERVICE COMPANY
By Nancy E. Newquist
...................................
Treasurer
Attest:
Betsy A. Pregulman
............................
Associate Secretary
THE BANK OF NEW YORK, as Trustee
By Walter N. Gitlin
...................................
Vice President
Attest:
Robert E. Patterson
............................
Assistant Vice President
68
STATE OF ARIZONA )
) ss.:
COUNTY OF MARICOPA )
On the 21st day of November before me personally came Nancy E. Newquist,
to me known, who, being by me duly sworn, did depose and say that she is
Treasurer of Arizona Public Service Company, one of the corporations described
in and which executed the foregoing instrument; that she knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation; and that she signed her name thereto by like authority.
Maria R. Marrs
.....................................
My Commission Expires July 21, 1998
................
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 20th day of November, before me personally came Walter N. Gitlin,
to me known, who, being by me duly sworn, did depose and say that he is Vice
President of The Bank of New York, one of the corporations described in and
which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation; and that he signed his name thereto by like authority.
William J. Cassels
.....................................
My Commission Expires May 16, 1998
................
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