EXHIBIT 4.2(a)
* This Instrument Grants a Security Interest by a
Public Utility
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SIERRA PACIFIC POWER COMPANY
TO
THE BANK OF NEW YORK
Trustee
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General and Refunding Mortgage Indenture
Dated as of May 1, 2001
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* This Instrument Contains After-Acquired Property Provisions
SIERRA PACIFIC POWER COMPANY
Reconciliation and Tie between Trust Indenture Act of 1939 and
Indenture, dated as of May 1, 2001
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Trust Indenture Act Section Indenture Section(s)
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Section 310(a)(1)....................................... 11.09
(a)(2)....................................... 11.09
(a)(3)....................................... 11.14(B)
(a)(4)....................................... Not Applicable
(b).......................................... 11.08, 11.10
Section 311(a).......................................... 11.13
(b).......................................... 11.13
(c).......................................... Not Applicable
Section 312(a).......................................... 12.01
(b).......................................... 12.01
(c).......................................... 12.01
Section 313(a).......................................... 12.02
(b).......................................... 12.02
(c).......................................... 12.02
(d).......................................... 12.02
Section 314(a).......................................... 12.02, 6.10
(b).......................................... 6.08
(c)(1)....................................... 1.04
(c)(2)....................................... 1.04
(c)(3)....................................... 1.05
(d).......................................... 4.02, 6.07(b),
8.03, 8.04, 8.09
(e).......................................... 1.04
Section 315(a).......................................... 11.01, 11.03
(b).......................................... 11.02
(c).......................................... 11.01
(d).......................................... 11.01
(e).......................................... 10.18
Section 316(a).......................................... 10.16
(a)(1)(A).................................... 10.02, 10.17
(a)(1)(B).................................... 10.17
(a)(2)....................................... Not Applicable
(b).......................................... 10.12
Section 317(a)(1)....................................... 10.06
(a)(2)....................................... 10.09
(b).......................................... 6.03
Section 318(a).......................................... 1.09
TABLE OF CONTENTS
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Page
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Recital of the Company.......................................................1
Granting Clauses.............................................................1
ARTICLE I DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION............6
SECTION 1.01 General Definitions.............................................6
"Accountant"...........................................................7
"Act"..................................................................7
"Affiliate"............................................................7
"Authenticating Agent".................................................7
"Authorized Officer"...................................................7
"Authorized Publication"...............................................7
"Authorized Purposes"..................................................7
"Board of Directors"...................................................7
"Board Resolution".....................................................8
"Business Day".........................................................8
"Commission"...........................................................8
"Company"..............................................................8
"Company Order" or "Company Request"...................................8
"Corporate Trust Office"...............................................8
"corporation"..........................................................8
"Cost".................................................................8
"Defaulted Interest"...................................................8
"Discount Security"....................................................8
"Dollar" or "$"........................................................8
"Eligible Obligations".................................................9
"Event of Default".....................................................9
"Excepted Property"....................................................9
"Expert"...............................................................9
"Expert's Certificate".................................................9
"Fair Value"...........................................................9
"First Mortgage Bonds"................................................10
"Funded Cash".........................................................10
"Funded Property".....................................................10
"Governmental Authority"..............................................10
"Government Obligations"..............................................10
"Holder"..............................................................10
"Indenture"...........................................................10
"Independent".........................................................10
"Independent Expert's Certificate"....................................11
"Initial Expert's Certificate"........................................11
"Initial Series"......................................................11
"Interest Payment Date"...............................................11
"Investment Securities"...............................................11
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"Lien"................................................................12
"Maturity"............................................................12
"Mortgaged Property"..................................................12
"Notice of Default"...................................................12
"Officer's Certificate"...............................................12
"Opinion of Counsel"..................................................12
"Outstanding".........................................................12
"Outstanding".........................................................13
"Paying Agent"........................................................13
"Periodic Offering"...................................................14
"Permitted Liens".....................................................14
"Person"..............................................................16
"Place of Payment"....................................................16
"Predecessor Security"................................................16
"Prepaid Lien"........................................................17
"Property Additions"..................................................17
"Purchase Money Lien".................................................17
"Redemption Date".....................................................18
"Redemption Price"....................................................18
"Regular Record Date".................................................18
"Required Currency"...................................................18
"Responsible Officer".................................................18
"Retired Securities"..................................................18
"Securities"..........................................................18
"Security Register" and "Security Registrar"..........................18
"Special Record Date".................................................18
"SPPC 1940 Mortgage"..................................................19
"Stated Interest Rate"................................................19
"Stated Maturity".....................................................19
"Successor Corporation"...............................................19
"Tranche".............................................................19
"Trust Indenture Act".................................................19
"Trustee".............................................................19
"United States".......................................................19
SECTION 1.02 Funded Property; Funded Cash...................................19
SECTION 1.03 Property Additions; Cost.......................................21
SECTION 1.04 Compliance Certificates and Opinions...........................23
SECTION 1.05 Content and Form of Documents Delivered to Trustee.............24
SECTION 1.06 Acts of Holders................................................26
SECTION 1.07 Notices, Etc. to Trustee and Company...........................27
SECTION 1.08 Notice to Holders of Securities; Waiver........................28
SECTION 1.09 Conflict with Trust Indenture Act..............................28
SECTION 1.10 Effect of Headings and Table of Contents.......................28
SECTION 1.11 Successors and Assigns.........................................29
SECTION 1.12 Separability Clause............................................29
SECTION 1.13 Benefits of Indenture..........................................29
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SECTION 1.14 Governing Law..................................................29
SECTION 1.15 Legal Holidays.................................................29
SECTION 1.16 Investment of Cash Held by Trustee.............................29
ARTICLE II SECURITY FORMS...................................................30
SECTION 2.01 Forms Generally................................................30
SECTION 2.02 Form of Trustee's Certificate of Authentication................31
ARTICLE III THE SECURITIES..................................................31
SECTION 3.01 Amount Unlimited; Issuable in Series...........................31
SECTION 3.02 Denominations..................................................34
SECTION 3.03 Execution, Dating, Certificate of Authentication...............34
SECTION 3.04 Temporary Securities...........................................35
SECTION 3.05 Registration, Registration of Transfer and Exchange............36
SECTION 3.06 Mutilated, Destroyed, Lost and Stolen Securities...............37
SECTION 3.07 Payment of Interest; Interest Rights Preserved.................38
SECTION 3.08 Persons Deemed Owners..........................................39
SECTION 3.09 Cancellation by Security Registrar.............................39
SECTION 3.10 Computation of Interest........................................39
SECTION 3.11 Payment to Be in Proper Currency...............................39
SECTION 3.12 CUSIP Numbers..................................................40
ARTICLE IV ISSUANCE OF SECURITIES...........................................40
SECTION 4.01 General........................................................40
SECTION 4.02 Issuance of Securities on the Basis of Property Additions......42
SECTION 4.03 Issuance of Securities on the Basis of Retired Securities......45
SECTION 4.04 Issuance of Securities on the Basis of Deposit of Cash.........45
ARTICLE V REDEMPTION OF SECURITIES..........................................46
SECTION 5.01 Applicability of Article.......................................46
SECTION 5.02 Election to Redeem; Notice to Trustee..........................46
SECTION 5.03 Selection of Securities to Be Redeemed.........................47
SECTION 5.04 Notice of Redemption...........................................47
SECTION 5.05 Securities Payable on Redemption Date..........................48
SECTION 5.06 Securities Redeemed in Part....................................49
ARTICLE VI COVENANTS........................................................49
SECTION 6.01 Payment of Securities; Lawful Possession; Maintenance of Lien..49
SECTION 6.02 Maintenance of Office or Agency................................49
SECTION 6.03 Money for Securities Payments to Be Held in Trust..............50
SECTION 6.04 Corporate Existence............................................51
SECTION 6.05 Maintenance of Properties......................................51
SECTION 6.06 Payment of Taxes; Discharge of Liens...........................52
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SECTION 6.07 Insurance......................................................52
SECTION 6.08 Recording, Filing, etc.........................................56
SECTION 6.09 Waiver of Certain Covenants....................................57
SECTION 6.10 Annual Officer's Certificate as to Compliance..................57
ARTICLE VII COVENANTS RELATING TO THE SPPC 1940 MORTGAGE....................57
SECTION 7.01 Prompt Payment of First Mortgage Bonds.........................57
SECTION 7.02 Closing and Discharge of SPPC 1940 Mortgage....................58
ARTICLE VIII POSSESSION, USE AND RELEASE OF MORTGAGED PROPERTY..............58
SECTION 8.01 Quiet Enjoyment................................................58
SECTION 8.02 Dispositions without Release...................................58
SECTION 8.03 Release of Funded Property.....................................59
SECTION 8.04 Release of Property Not Constituting Funded Property...........64
SECTION 8.05 Release of Minor Properties....................................65
SECTION 8.06 Withdrawal or Other Application of Funded Cash; Purchase
Money Obligations..............................................66
SECTION 8.07 Release of Property Taken by Eminent Domain, etc...............69
SECTION 8.08 Disclaimer or Quitclaim........................................69
SECTION 8.09 Miscellaneous..................................................70
ARTICLE IX SATISFACTION AND DISCHARGE.......................................71
SECTION 9.01 Satisfaction and Discharge of Securities.......................71
SECTION 9.02 Satisfaction and Discharge of Indenture........................73
SECTION 9.03 Application of Trust Money.....................................74
ARTICLE X EVENTS OF DEFAULT; REMEDIES.......................................74
SECTION 10.01 Events of Default.............................................74
SECTION 10.02 Acceleration of Maturity; Rescission and Annulment............76
SECTION 10.03 Entry upon Mortgaged Property.................................77
SECTION 10.04 Power of Sale; Suits for Enforcement..........................77
SECTION 10.05 Incidents of Sale.............................................77
SECTION 10.06 Collection of Indebtedness and Suits for Enforcement by
Trustee.......................................................78
SECTION 10.07 Application of Money Collected................................79
SECTION 10.08 Receiver......................................................80
SECTION 10.09 Trustee May File Proofs of Claim..............................80
SECTION 10.10 Trustee May Enforce Claims without Possession of Securities...81
SECTION 10.11 Limitation on Suits...........................................81
SECTION 10.12 Unconditional Right of Holders to Receive Principal,
Premium and Interest..........................................82
SECTION 10.13 Restoration of Rights and Remedies............................82
SECTION 10.14 Rights and Remedies Cumulative................................82
SECTION 10.15 Delay or Omission Not Waiver..................................82
SECTION 10.16 Control by Holders of Securities..............................83
SECTION 10.17 Waiver of Past Defaults.......................................83
SECTION 10.18 Undertaking for Costs.........................................83
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SECTION 10.19 Waiver of Appraisement and Other Laws.........................84
ARTICLE XI THE TRUSTEE......................................................84
SECTION 11.01 Certain Duties and Responsibilities...........................84
SECTION 11.02 Notice of Defaults............................................85
SECTION 11.03 Certain Rights of Trustee.....................................85
SECTION 11.04 Not Responsible for Recitals or Issuance of Securities or
Application of Proceeds.......................................87
SECTION 11.05 May Hold Securities...........................................87
SECTION 11.06 Money Held in Trust...........................................87
SECTION 11.07 Compensation and Reimbursement................................88
SECTION 11.08 Disqualification; Conflicting Interests.......................88
SECTION 11.09 Corporate Trustee Required; Eligibility.......................89
SECTION 11.10 Resignation and Removal; Appointment of Successor.............89
SECTION 11.11 Acceptance of Appointment by Successor........................91
SECTION 11.12 Merger, Conversion, Consolidation or Succession to Business...91
SECTION 11.13 Preferential Collection of Claims against Company.............91
SECTION 11.14 Co-trustees and Separate Trustees.............................92
SECTION 11.15 Appointment of Authenticating Agent...........................93
ARTICLE XII LISTS OF HOLDERS; REPORTS BY TRUSTEE AND COMPANY................95
SECTION 12.01 Lists of Holders..............................................95
SECTION 12.02 Reports by Trustee and Company................................95
ARTICLE XIII CONSOLIDATION, MERGER, CONVEYANCE OR OTHER TRANSFER............96
SECTION 13.01 Company May Consolidate, etc., Only on Certain Terms..........96
SECTION 13.02 Successor Corporation Substituted.............................97
SECTION 13.03 Extent of Lien Hereof on Property of Successor Corporation....98
SECTION 13.04 Release of Company upon Conveyance or Other Transfer..........98
SECTION 13.05 Merger into Company; Extent of Lien Hereof....................98
ARTICLE XIV SUPPLEMENTAL INDENTURES.........................................99
SECTION 14.01 Supplemental Indentures without Consent of Holders............99
SECTION 14.02 Supplemental Indentures with Consent of Holders..............101
SECTION 14.03 Execution of Supplemental Indentures.........................102
SECTION 14.04 Effect of Supplemental Indentures............................102
SECTION 14.05 Conformity with Trust Indenture Act..........................102
SECTION 14.06 Reference in Securities to Supplemental Indentures...........103
SECTION 14.07 Modification Without Supplemental Indenture..................103
ARTICLE XV MEETINGS OF HOLDERS; ACTION WITHOUT MEETING.....................103
SECTION 15.01 Purposes for Which Meetings May Be Called....................103
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SECTION 15.02 Call, Notice and Place of Meetings...........................103
SECTION 15.03 Persons Entitled to Vote at Meetings.........................104
SECTION 15.04 Quorum; Action...............................................104
SECTION 15.05 Attendance at Meetings; Determination of Voting Rights;
Conduct and Adjournment of Meetings..........................105
SECTION 15.06 Counting Votes and Recording Action of Meetings..............106
SECTION 15.07 Action Without Meeting.......................................107
ARTICLE XVI IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND
DIRECTORS..................................................................107
SECTION 16.01 Liability Solely Corporate...................................107
Signatures.................................................................110
Acknowledgment ............................................................111
Exhibit A Property Description (Real Property)...........................A-1
Exhibit B Property Description (Licenses, Permits, Etc.).................B-1
Exhibit C Recording Information..........................................C-1
Exhibit D Excepted Water Properties......................................D-1
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GENERAL AND REFUNDING MORTGAGE INDENTURE, dated as of May 1, 2001,
between SIERRA PACIFIC POWER COMPANY, a corporation organized and existing under
the laws of the State of Nevada (herein called the "Company"), and THE BANK OF
NEW YORK, a banking corporation organized and existing under the laws of the
State of New York, as Trustee (herein called the "Trustee").
Recital of the Company
The Company has duly authorized the execution and delivery of this
Indenture, as originally executed and delivered, to provide for the issuance
from time to time of its bonds, notes or other evidences of indebtedness (herein
called the "Securities"), to be issued in one or more series as contemplated
herein, and to provide security for the payment of the principal of and premium,
if any, and interest, if any, on the Securities; and all acts necessary to make
this Indenture a valid agreement of the Company have been performed. For all
purposes of this Indenture, except as otherwise expressly provided or unless the
context otherwise requires, capitalized terms used herein shall have the
meanings assigned to them in Article I of this Indenture.
Granting Clauses
NOW, THEREFORE, THIS INDENTURE WITNESSETH, that, in consideration of
the premises and of the purchase of the Securities by the Holders thereof, and
in order to secure the payment of the principal of and premium, if any, and
interest, if any, on all Securities from time to time Outstanding and the
performance of the covenants therein and herein contained and to declare the
terms and conditions on which such Securities are secured, the Company hereby
grants, bargains, sells, conveys, assigns, transfers, mortgages, pledges, sets
over and confirms to the Trustee, and grants to the Trustee a security interest
in, the following (subject, however, to the terms and conditions set forth in
this Indenture):
Granting Clause First
All right, title and interest of the Company, as of the date of the
execution and delivery of this Indenture, as originally executed and
delivered, in and to all property, real, personal and mixed, located in
the State of Nevada (other than Excepted Property), including without
limitation all right, title and interest of the Company in and to the
following property so located (other than Excepted Property): (a) all real
property owned in fee, easements and other interests in real property
which are specifically described or referred to in Exhibit A attached
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hereto and incorporated herein by this reference; (b) all licenses,
permits to use the real property of others, franchises to use public
roads, streets and other public properties, rights of way and other rights
or interests relating to the occupancy or use of real property, including
without limitation all of the same which are specifically described or
referred to in Exhibit B attached hereto and incorporated herein by this
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reference; (c) all facilities, machinery, equipment and fixtures for the
generation, transmission and distribution of electric energy including,
but not limited to, all plants, powerhouses, dams, diversion works,
generators, turbines, engines, boilers, fuel handling and transportation
facilities, air and water pollution
1
control and sewage and solid waste disposal facilities, switchyards,
towers, substations, transformers, poles, lines, cables, conduits, ducts,
conductors, meters, regulators and all other property used or to be used
for any or all of such purposes; (d) all facilities, machinery, equipment
and fixtures for the transmission, storage and distribution of gas
including, but not limited to, gas works, stations and substations,
transmission pipelines, storage facilities, holders, tanks, retorts,
purifiers, odorizers, scrubbers, compressors, valves, regulators, pumps,
mains, pipes, service pipes, conduits, ducts, fittings and connections,
services, meters and any and all other property used or to be used for any
or all of such purposes; (e) all buildings, offices, warehouses,
structures or improvements in addition to those referred to or otherwise
included in clauses (a), (c) and (d) above; (f) all computers, data
processing, data storage, data transmission and/or telecommunications
facilities, equipment and apparatus necessary for the operation or
maintenance of any facilities, machinery, equipment or fixtures described
or referred to in clauses (c) or (d) above; and (g) all of the foregoing
property in the process of construction;
Granting Clause Second
Subject to the applicable exceptions permitted by Section 8.09(c),
Section 13.03 and Section 13.05, all right, title and interest of the
Company in all property, real, personal and mixed, located in the State of
Nevada (other than Excepted Property) which may be hereafter acquired by
the Company, it being the intention of the Company that all such property
acquired by the Company after the date of the execution and delivery of
this Indenture, as originally executed and delivered, shall be as fully
embraced within and subjected to the Lien hereof as if such property were
owned by the Company as of the date of the execution and delivery of this
Indenture, as originally executed and delivered;
Granting Clause Third
Any Excepted Property, which may, from time to time after the date
of the execution and delivery of this Indenture, as originally executed
and delivered, by delivery or by an instrument supplemental to this
Indenture, be subjected to the Lien hereof by the Company, the Trustee
being hereby authorized to receive the same at any time as additional
security hereunder; it being understood that any such subjection to the
Lien hereof of any Excepted Property as additional security may be made
subject to such reservations, limitations or conditions respecting the use
and disposition of such property or the proceeds thereof as shall be set
forth in such instrument; and
Granting Clause Fourth
All tenements, hereditaments, servitudes and appurtenances belonging
or in any wise appertaining to the aforesaid property, with the reversions
and remainders thereof;
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Excepted Property
Expressly excepting and excluding, however, from the Lien of this
Indenture all right, title and interest of the Company in and to the
following property, whether now owned or hereafter acquired (herein
sometimes called "Excepted Property"):
(a) all cash on hand or in banks or other financial
institutions, deposit accounts, shares of stock, interests in
general or limited partnerships, bonds, notes, other evidences of
indebtedness and other securities, of whatsoever kind and nature,
not hereafter paid or delivered to, deposited with or held by the
Trustee hereunder or required so to be;
(b) all contracts, leases, operating agreements and other
agreements of whatsoever kind and nature; all contract rights,
bills, notes and other instruments and chattel paper (except to the
extent that any of the same constitute securities, in which case
they are separately excepted from the Lien of this Indenture under
clause (a) above); all revenues, income and earnings, all accounts,
accounts receivable and unbilled revenues, and all rents, tolls,
issues, product and profits, claims, credits, demands and judgments;
all governmental and other licenses, permits, franchises, consents
and allowances (except to the extent that any of the same are
specifically described in clause (b) of Granting Clause First of
this Indenture, in which case they are included within the Lien of
this Indenture); and all patents, patent licenses and other patent
rights, patent applications, trade names, trademarks, copyrights,
domain names, claims, credits, choses in action and other intangible
property and general intangibles including, but not limited to,
computer software;
(c) All automobiles, buses, trucks, truck cranes, tractors,
trailers and similar vehicles and movable equipment; all rolling
stock, rail cars and other railroad equipment; all vessels, boats,
barges and other marine equipment; all airplanes, helicopters,
aircraft engines and other flight equipment; all parts, accessories
and supplies used in connection with any of the foregoing; and all
personal property of such character that the perfection of a
security interest therein or other Lien thereon is not governed by
the Uniform Commercial Code as in effect in the jurisdiction in
which such property is located;
(d) all goods, stock in trade, wares, merchandise and
inventory held for the purpose of sale or lease in the ordinary
course of business; all materials, supplies, inventory and other
items of personal property which are consumable (otherwise than
3
by ordinary wear and tear) in their use in the operation of the
Mortgaged Property; all fuel, including nuclear fuel, whether or not
any such fuel is in a form consumable in the operation of the
Mortgaged Property, including separate components of any fuel in the
forms in which such components exist at any time before, during or
after the period of the use thereof as fuel; all hand and other
portable tools and equipment; all furniture and furnishings; and
computers and data processing, data storage, data transmission,
telecommunications and other facilities, equipment and apparatus,
which, in any case, are used primarily for administrative or
clerical purposes or are otherwise not necessary for the operation
or maintenance of the facilities, machinery, equipment or fixtures
described or referred to in clause (c) or (d) of Granting Clause
First of this Indenture;
(e) all coal, ore, gas, oil and other minerals and all timber,
and all rights and interests in any of the foregoing, whether or not
such minerals or timber shall have been mined or extracted or
otherwise separated from the land; and all electric energy, gas
(natural or artificial), steam, water and other products generated,
produced, manufactured, purchased or otherwise acquired by the
Company;
(f) all real property, leaseholds, gas rights, wells,
gathering, tap or other pipe lines, or facilities, equipment or
apparatus, in any case used or to be used primarily for the
production or gathering of natural gas;
(g) all property which is the subject of a lease agreement
designating the Company as lessee and all right, title and interest
of the Company in and to such property and in, to and under such
lease agreement, whether or not such lease agreement is intended as
security;
(h) all facilities, machinery, equipment and fixtures for the
appropriation, storage, transmission and distribution of water
including, but not limited to, water works, reservoirs, diversion
works, stations and substations, transmission pipelines, canals,
raceways, flumes, waterways, aqueducts, storage facilities, tanks,
purifiers, valves, regulators, pumps, mains, pipes, service pipes,
conduits, fittings and connections, services, meters and any and all
other property used or to be used for any or all of such purposes,
including all such property described or referred to in Exhibit D
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attached hereto; and
(i) all property, real, personal and mixed, which prior to the
date of the execution and delivery of this Indenture, as
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originally executed and delivered, has been excepted or released
from the Lien of the SPPC 1940 Mortgage;
provided, however, that, subject to the provisions of Section 13.03 (x)
if, at any time after the occurrence of an Event of Default, the Trustee,
or any separate trustee or co-trustee appointed under Section 11.14 or any
receiver appointed pursuant to Section 10.08 or otherwise, shall have
entered into possession of all or substantially all of the Mortgaged
Property, all the Excepted Property described or referred to in the
foregoing clauses (b), (c) and (d), then owned or held or thereafter
acquired by the Company, to the extent that the same is used in connection
with, or otherwise relates or is attributable to, the Mortgaged Property,
shall immediately, and, in the case of any Excepted Property described or
referred to in clause (f), to the extent that the same is used in
connection with, or otherwise relates or is attributable to, the Mortgaged
Property, upon demand of the Trustee or such other trustee or receiver,
become subject to the Lien of this Indenture to the extent not prohibited
by law or by the terms of any other Lien on such Excepted Property, and
the Trustee or such other trustee or receiver may, to the extent not
prohibited by law or by the terms of any such other Lien (and subject to
the rights of the holders of all such other Liens), at the same time
likewise take possession thereof, and (y) whenever all Events of Default
shall have been cured and the possession of all or substantially all of
the Mortgaged Property shall have been restored to the Company, such
Excepted Property shall again be excepted and excluded from the Lien
hereof to the extent set forth above; it being understood that the Company
may, however, pursuant to Granting Clause Third, subject to the Lien of
this Indenture any Excepted Property, whereupon the same shall cease to be
Excepted Property;
TO HAVE AND TO HOLD all such property, real, personal and mixed,
unto the Trustee, its successors in trust and their assigns forever;
SUBJECT, HOWEVER, to (a) Liens existing at the date of the execution
and delivery of this Indenture, as originally executed and delivered (including,
but not limited to, the Lien of the SPPC 1940 Mortgage), (b) as to property
acquired by the Company after the date of the execution and delivery of this
Indenture, as originally executed and delivered, Liens existing or placed
thereon at the time of the acquisition thereof (including, but not limited to,
Purchase Money Liens), (c) Permitted Liens and all other Liens permitted to
exist under Section 6.06; and
SUBJECT, FURTHER, to the condition that, with respect to any
property which is now or hereafter becomes subject to the Lien of the SPPC 1940
Mortgage, the Lien of this Indenture shall at all times be junior, subject and
subordinate to the Lien of the SPPC 1940 Mortgage;
IN TRUST, NEVERTHELESS, for the equal and ratable benefit and
security of the Holders from time to time of all Outstanding Securities without
any priority of any such Security over any other such Security;
PROVIDED, HOWEVER, that the right, title and interest of the Trustee
in and to the Mortgaged Property shall cease, terminate and become void in
accordance with, and subject to the conditions set forth in, Article IX or
Article XIV hereof, and if, thereafter, the
5
principal of and premium, if any, and interest, if any, on the Securities shall
have been paid to the Holders thereof, or shall have been paid to the Company
pursuant to Section 6.03 hereof, then and in that case this Indenture shall
terminate, and the Trustee shall execute and deliver to the Company such
instruments as the Company shall require to evidence such termination; otherwise
this Indenture, and the estate and rights hereby granted, shall be and remain in
full force and effect; and
IT IS HEREBY COVENANTED AND AGREED by and between the Company and
the Trustee that all the Securities are to be authenticated and delivered, and
that the Mortgaged Property is to be held, subject to the further covenants,
conditions and trusts hereinafter set forth, and the Company hereby covenants
and agrees to and with the Trustee, for the equal and ratable benefit of all
Holders of the Securities, as follows:
ARTICLE I
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DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
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SECTION 1.01 General Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(b) all terms used herein without definition which are defined in
the Trust Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein;
(c) all terms used herein without definition which are defined in
the Uniform Commercial Code as in effect in any jurisdiction in which any
portion of the Mortgaged Property is located shall have the meanings assigned to
them therein with respect to such portion of the Mortgaged Property;
(d) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States; 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 at the date of such
computation or, at the election of the Company from time to time, at the date of
the execution and delivery of this Indenture, as originally executed and
delivered; provided, however, that in determining generally accepted accounting
principles applicable to the Company, effect shall be given, to the extent
required, to any order, rule or regulation of any administrative agency,
regulatory authority or other governmental body having jurisdiction over the
Company; and
6
(e) 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.
"Accountant" means a Person engaged in the accounting profession or
otherwise qualified to pass on accounting matters (including, but not limited
to, a Person certified or licensed as a public accountant, whether or not then
engaged in the public accounting profession), which Person, unless required to
be Independent, may be an employee or Affiliate of the Company.
"Act", when used with respect to any Holder of a Security, has the
meaning specified in Section 1.06.
"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 generally 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 (other than the Company or
an Affiliate of the Company) authorized by the Trustee to act on behalf of the
Trustee to authenticate the Securities of one or more series.
"Authorized Officer" means the Chairman of the Board, the President,
any Vice President, the Treasurer or the Corporate Secretary of the Company, or
any other duly authorized officer, agent or attorney-in-fact of the Company
named in an Officer's Certificate signed by any of such corporate officers.
"Authorized Publication" means a newspaper or financial journal of
general circulation, printed in the English language and customarily published
on each Business Day, whether or not published on Saturdays, Sundays or
holidays; or, in the alternative, shall mean such form of communication as may
have come into general use for the dissemination of information of import
similar to that of the information specified to be published by the provisions
hereof. In the event that successive weekly publications in an Authorized
Publication are required hereunder they may be made (unless otherwise expressly
provided herein) on the same or different days of the week and in the same or in
different Authorized Publications. In case, by reason of the suspension of
publication of any Authorized Publication, or by reason of any other cause, it
shall be impractical without unreasonable expense to make publication of any
notice in an Authorized Publication as required by this Indenture, then such
method of publication or notification as shall be made with the approval of the
Trustee shall be deemed the equivalent of the required publication of such
notice in an Authorized Publication.
"Authorized Purposes" means the authentication and delivery of
Securities, the release of property and/or the withdrawal of cash under any of
the provisions of this Indenture.
"Board of Directors" means either the board of directors of the
Company or any committee thereof duly authorized to act in respect of matters
relating to this Indenture.
7
"Board Resolution" means a copy of a resolution certified by the
Corporate Secretary or an Assistant Corporate 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 a Place of Payment or any
other particular location specified in the Securities or this Indenture, means
any day, other than a Saturday or Sunday, which is not a day on which banking
institutions or trust companies in such Place of Payment or other location are
generally authorized or required by law, regulation or executive order to remain
closed, except as may be otherwise specified as contemplated by Section 3.01.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934, as
amended, or, if at any time after the date of the execution and delivery of this
Indenture, as originally executed and delivered, such Commission is not existing
and performing the duties now assigned to it under the Trust Indenture Act, then
the body, if any, performing such duties at such time.
"Company" means the Person named as the "Company" in the first
paragraph of this Indenture until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Order" or "Company Request" means a written request or
order signed in the name of the Company by an Authorized Officer and delivered
to the Trustee.
"Corporate Trust Office" means the office of the Trustee in New
York, New York, at which at any particular time its corporate trust business
shall be principally administered, which office at the date of the execution and
delivery of this Indenture, as originally executed and delivered, is located at
101 Barclay Street, New York, New York, 10286, Attention: Corporate Trust
Administration.
"corporation" means a corporation, limited liability company,
association, company, joint stock company or business trust.
"Cost" with respect to Property Additions has the meaning specified
in Section 1.03.
"Defaulted Interest" has the meaning specified in Section 3.07.
"Discount Security" means any Security 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 10.02. "Interest"
with respect to a Discount Security means interest, if any, borne by such
Security at a Stated Interest Rate.
"Dollar" or "$" means a dollar or other equivalent unit in such coin
or currency of the United States as at the time shall be legal tender for the
payment of public and private debts.
8
"Eligible Obligations" means:
(a) with respect to Securities denominated in Dollars,
Government Obligations; or
(b) with respect to Securities denominated in a currency other
than Dollars or in a composite currency, such other obligations or
instruments as shall be specified with respect to such Securities as
contemplated by Section 3.01.
"Event of Default" has the meaning specified in Section 10.01.
"Excepted Property" has the meaning specified in the granting
clauses of this Indenture.
"Expert" means a Person which is an engineer, appraiser or other
expert and which, with respect to any certificate to be signed by such Person
and delivered to the Trustee, is qualified to pass upon the matters set forth in
such certificate. For purposes of this definition, (a) "engineer" means a Person
engaged in the engineering profession or otherwise qualified to pass upon
engineering matters (including, but not limited to, a Person licensed as a
professional engineer, whether or not then engaged in the engineering
profession) and (b) "appraiser" means a Person engaged in the business of
appraising property or otherwise qualified to pass upon the Fair Value or fair
market value of property.
"Expert's Certificate" means a certificate signed by an Authorized
Officer and by an Expert (which Expert (a) shall be selected either by the Board
of Directors or by an Authorized Officer, the execution of such certificate by
such Authorized Officer to be conclusive evidence of such selection, and (b)
except as otherwise required in Sections 4.03, 6.07, 7.07 and 8.09, may be an
employee or Affiliate of the Company duly authorized either by the Board of
Directors or by an Authorized Officer) and delivered to the Trustee. The amount
stated in any Expert's Certificate as to the Cost, Fair Value or fair market
value of property shall be conclusive and binding upon the Company, the Trustee
and the Holders of the Securities.
"Fair Value", with respect to property, means the fair value of such
property as may be determined by reference to (a) the amount which would be
likely to be obtained in an arm's-length transaction with respect to such
property between an informed and willing buyer and an informed and willing
seller, under no compulsion, respectively, to buy or sell, (b) the amount of
investment with respect to such property which, together with a reasonable
return thereon, would be likely to be recovered through ordinary business
operations or otherwise, (c) the Cost, accumulated depreciation and replacement
cost with respect to such property and/or (d) any other relevant factors;
provided, however, that (x) the Fair Value of property shall be determined
without deduction for any Liens on such property prior to the Lien of this
Indenture (except as otherwise provided in Section 8.03) and (y) the Fair Value
to the Company of Property Additions shall not reflect any reduction relating to
the fact that such Property Additions may be of less value to a Person which is
not the owner or operator of the Mortgaged Property or any portion thereof than
to a Person which is such owner or operator. Fair Value may be determined,
without physical inspection, by the use of accounting and engineering
9
records and other data maintained by the Company or otherwise available to the
Expert certifying the same.
"First Mortgage Bonds" means bonds or other obligations issued and
Outstanding under the SPPC 1940 Mortgage and any bonds authenticated in
replacement thereof under the provisions of Section 7.02 hereof.
"Funded Cash" has the meaning specified in Section 1.02.
"Funded Property" has the meaning specified in Section 1.02.
"Governmental Authority" means the government of the United States
or of any State or Territory thereof or of the District of Columbia or of any
county, municipality or other political subdivision of any thereof, or any
department, agency, authority or other instrumentality of any of the foregoing.
"Government Obligations" means:
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States
entitled to the benefit of the full faith and credit thereof; and
(b) certificates, depositary receipts or other instruments which
evidence a direct ownership interest in obligations described in clause
(a) above or in any specific interest or principal payments due in respect
thereof; provided, however, that the custodian of such obligations or
specific interest or principal payments shall be a bank or trust company
(which may include the Trustee or any Paying Agent) subject to Federal or
State supervision or examination with a combined capital and surplus of at
least Fifty Million Dollars ($50,000,000); and provided, further, that
except as may be otherwise required by law, such custodian shall be
obligated to pay to the holders of such certificates, depositary receipts
or other instruments the full amount received by such custodian in respect
of such obligations or specific payments and shall not be permitted to
make any deduction therefrom.
"Holder" means a Person in whose name a Security is registered in
the Security Register.
"Indenture" means this instrument as originally executed and
delivered and as it may from time to time be supplemented or amended by one or
more indentures or other instruments supplemental hereto entered into pursuant
to the applicable provisions hereof and shall include the terms of particular
series of Securities established as contemplated by Section 3.01.
"Independent", when applied to any Accountant or Expert, means such
a Person who (a) is in fact independent, (b) does not have any direct material
financial interest in the Company or in any other obligor upon the Securities or
in any Affiliate of the Company or of such other obligor, (c) is not connected
with the Company or such other obligor as an officer,
10
employee, promoter, underwriter, trustee, partner, director or any person
performing similar functions and (d) is approved by the Trustee in the exercise
of reasonable care.
"Independent Expert's Certificate" means a certificate signed by an
Independent Expert and delivered to the Trustee.
"Initial Expert's Certificate" means an Expert's certificate
delivered upon the earliest of (a) the first authentication and delivery of
Securities, subsequent to the initial authentication and delivery of the
Securities of the Initial Series (excluding Securities of the Initial Series
issued in connection with a transfer, exchange or replacement of any Predecessor
Securities of such series), upon the basis of Property Additions pursuant to
Section 4.02, (b) the first release of any part of the Mortgaged Property
pursuant to Section 8.03 or 8.04 and (c) the first withdrawal of cash on the
basis of Property Additions pursuant to Section 8.06.
"Initial Series" means the series of Securities, initially
authenticated and delivered in the aggregate principal amount of $320,000,000,
established in the First Supplemental Indenture, dated as of May 1, 2001 between
the Company and the Trustee, the form and terms of which are established in the
Officer's Certificate, dated May 24, 2001, pursuant to the First Supplemental
Indenture.
"Interest Payment Date", when used with respect to any Security,
means the Stated Maturity of an installment of interest on such Security.
"Investment Securities" means any of the following obligations or
securities on which neither the Company, any other obligor on the Securities nor
any Affiliate of either is the obligor: (a) Government Obligations; (b) interest
bearing deposit accounts (which may be represented by certificates of deposit)
in any national or state bank (which may include the Trustee or any Paying
Agent) or savings and loan association which has outstanding securities rated by
a nationally recognized rating organization in either of the two (2) highest
rating categories (without regard to modifiers) for short term securities or in
any of the three (3) highest rating categories (without regard to modifiers) for
long term securities; (c) bankers' acceptances drawn on and accepted by any
commercial bank (which may include the Trustee or any Paying Agent) which has
outstanding securities rated by a nationally recognized rating organization in
either of the two (2) highest rating categories (without regard to modifiers)
for short term securities or in any of the three (3) highest rating categories
(without regard to modifiers) for long term securities; (d) direct obligations
of, or obligations the principal of and interest on which are unconditionally
guaranteed by, any State or Territory of the United States or the District of
Columbia, or any political subdivision of any of the foregoing, which are rated
by a nationally recognized rating organization in either of the two (2) highest
rating categories (without regard to modifiers) for short term securities or in
any of the three (3) highest rating categories (without regard to modifiers) for
long term securities; (e) bonds or other obligations of any agency or
instrumentality of the United States; (f) corporate debt securities which are
rated by a nationally recognized rating organization in either of the two (2)
highest rating categories (without regard to modifiers) for short term
securities or in any of the three (3) highest rating categories (without regard
to modifiers) for long term securities; (g) repurchase agreements with respect
to any of the foregoing obligations or securities with any banking or financial
institution (which may include the Trustee or any Paying Agent) which has
outstanding securities rated by a
11
nationally recognized rating organization in either of the two (2) highest
rating categories (without regard to modifiers) for short term securities or in
any of the three (3) highest rating categories (without regard to modifiers) for
long term securities; (h) securities issued by any regulated investment company
(including any investment company for which the Trustee or any Paying Agent is
the advisor), as defined in Section 851 of the Internal Revenue Code of 1986, as
amended, or any successor Section of such Code or successor federal statute,
provided that the portfolio of such investment company is limited to obligations
or securities of the character and investment quality contemplated in clauses
(a) through (f) above and repurchase agreements which are fully collateralized
by any of such obligations or securities; and (i) any other obligations or
securities which may lawfully be purchased by the Trustee in its capacity as
such.
"Lien" means any mortgage, deed of trust, pledge, security interest,
encumbrance, easement, lease, reservation, restriction, servitude, charge or
similar right and any other lien of any kind, including, without limitation, any
conditional sale or other title retention agreement, any lease in the nature
thereof, and any defect, irregularity, exception or limitation in record title.
"Maturity", when used with respect to any Security, means the date
on which the principal of such Security or an installment of principal becomes
due and payable as provided in such Security or in this Indenture, whether at
the Stated Maturity, by declaration of acceleration, upon call for redemption or
otherwise.
"Mortgaged Property" means, as of any particular time, all property
which at such time is subject to the Lien of this Indenture.
"Notice of Default" has the meaning specified in Section 10.01.
"Officer's Certificate" means a certificate signed by an Authorized
Officer and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company or other counsel acceptable to the Trustee and who may
be an employee or Affiliate of the Company.
"Outstanding", when used with respect to Securities, means, as of
the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(a) Securities theretofore canceled or delivered to the
Securities Registrar or the Trustee for cancellation;
(b) Securities deemed to have been paid for all purposes of this
Indenture in accordance with Section 9.01 (whether or not the Company's
indebtedness in respect thereof shall be satisfied and discharged for any
other purpose); and
(c) Securities which have been paid pursuant to Section 3.06 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities
in respect of which there shall have been presented to the Trustee proof
satisfactory to it and the Company that such Securities are
12
held by a bona fide purchaser or purchasers in whose hands such Securities
are valid obligations of the Company;
provided, however, that in determining whether or not the Holders of the
requisite principal amount of the Securities Outstanding under this Indenture,
or the Outstanding Securities of any series or Tranche, have given any request,
demand, authorization, direction, notice, consent or waiver hereunder or whether
or not a quorum is present at a meeting of Holders of Securities,
(x) Securities owned by the Company or any other obligor upon the
Securities or any Affiliate of the Company or of such other obligor
(unless the Company, such obligor or such Affiliate owns all Securities
Outstanding under this Indenture, or all Outstanding Securities of each
such series and each such Tranche, as the case may be, determined without
regard to this clause (x)) 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 or waiver or upon any such determination as to
the presence of a quorum, only Securities which the Trustee actually knows
to be so owned shall be so disregarded; provided, however, that Securities
so owned which have been pledged in good faith may be regarded as
Outstanding if it is established to the reasonable satisfaction of the
Trustee that the pledgee, and not the Company, any such other obligor or
Affiliate of either thereof, has the right so to act with respect to such
Securities and that the pledgee is not the Company or any other obligor
upon the Securities or any Affiliate of the Company or of such other
obligor; and provided, further, that in no event shall any Security which
shall have been delivered to evidence or secure, in whole or in part, the
Company's obligations in respect of other indebtedness be deemed to be
owned by the Company if the principal of such Security is payable, whether
at Stated Maturity or upon mandatory redemption, at the same time as the
principal of such other indebtedness is payable, whether at Stated
Maturity or upon mandatory redemption or acceleration, but only to the
extent of such portion of the principal amount of such Security as does
not exceed the principal amount of such other indebtedness; and
(y) the principal amount of a Discount Security that shall be deemed
to be Outstanding for such purposes shall be the amount of the principal
thereof that would be due and payable as of the date of such determination
upon a declaration of acceleration of the Maturity thereof pursuant to
Section 10.02; and
provided, further, that, in the case of any Security the principal of which is
payable from time to time without presentment or surrender, the principal amount
of such Security that shall be deemed to be Outstanding at any time for all
purposes of this Indenture shall be the original principal amount thereof less
the aggregate amount of principal thereof theretofore paid.
"Outstanding", when used with respect to First Mortgage Bonds, has
the meaning specified in the SPPC 1940 Mortgage.
"Paying Agent" means any Person, including the Company, authorized
by the Company to pay the principal of and premium, if any, or interest, if any,
on any Securities on behalf of the Company.
13
"Periodic Offering" means an offering of Securities of a series from
time to time any or all of the specific terms of which Securities, including
without limitation the rate or rates of interest, if any, thereon, the Stated
Maturity or Maturities thereof and the redemption provisions, if any, with
respect thereto, are to be determined by the Company or its agents from time to
time subsequent to the initial request for the authentication and delivery of
such Securities by the Trustee, all as contemplated in Section 3.01 and clause
(b) of Section 4.01.
"Permitted Liens" means, as of any particular time, any of the
following:
(a) Liens for taxes, assessments and other governmental charges or
requirements which are not delinquent or which are being contested in good
faith by appropriate proceedings;
(b) mechanics', workmen's, repairmen's, materialmen's,
warehousemen's and carriers' Liens, other Liens incident to construction,
Liens or privileges of any employees of the Company for salary or wages
earned, but not yet payable, and other Liens, including without limitation
Liens for worker's compensation awards, arising in the ordinary course of
business for charges or requirements which are not delinquent or which are
being contested in good faith and by appropriate proceedings;
(c) Liens in respect of attachments, judgments or awards arising out
of judicial or administrative proceedings (i) in an amount not exceeding
the greater of (A) Ten Million Dollars ($10,000,000) and (B) three
percentum (3%) of the sum of (1) the principal amount of the Securities
then Outstanding and (2) the principal amount of First Mortgage Bonds then
Outstanding other than First Mortgage Bonds delivered to and held by the
Trustee pursuant to Sections 4.03 or (ii) with respect to which the
Company shall (X) in good faith be prosecuting an appeal or other
proceeding for review and with respect to which the Company shall have
secured a stay of execution pending such appeal or other proceeding or (Y)
have the right to prosecute an appeal or other proceeding for review;
(d) easements, leases, reservations or other rights of others in,
on, over and/or across, and laws, regulations and restrictions affecting,
and defects, irregularities, exceptions and limitations in title to, the
Mortgaged Property or any part thereof; provided, however, that such
easements, leases, reservations, rights, laws, regulations, restrictions,
defects, irregularities, exceptions and limitations do not in the
aggregate materially impair the use by the Company of the Mortgaged
Property considered as a whole for the purposes for which it is held by
the Company;
(e) defects, irregularities, exceptions and limitations in title to
real property subject to rights-of-way in favor of the Company or
otherwise or used or to be used by the Company primarily for right-of-way
purposes or real property held under lease, easement, license or similar
right; provided, however, that (i) the Company shall have obtained from
the apparent owner or owners of such real property a sufficient right, by
the terms of the instrument granting such right-of-way, lease, easement,
license or similar right, to the use thereof for the purposes for which
the Company acquired the same, (ii) the Company has power under eminent
domain or similar statutes to remove such defects,
14
irregularities, exceptions or limitations or (iii) such defects,
irregularities, exceptions and limitations may be otherwise remedied
without undue effort or expense; and defects, irregularities, exceptions
and limitations in title to flood lands, flooding rights and/or water
rights;
(f) Liens securing indebtedness or other obligations neither
created, assumed nor guaranteed by the Company nor on account of which it
customarily pays interest upon real property or rights in or relating to
real property acquired by the Company for the purpose of the transmission
or distribution of electric energy, gas or water, for the purpose of
telephonic, telegraphic, radio, wireless or other electronic communication
or otherwise for the purpose of obtaining rights-of-way;
(g) leases existing at the date of the execution and delivery of
this Indenture, as originally executed and delivered, affecting properties
owned by the Company at said date and renewals and extensions thereof; and
leases affecting such properties entered into after such date or affecting
properties acquired by the Company after such date which, in either case,
(i) have respective terms of not more than ten (10) years (including
extensions or renewals at the option of the tenant) or (ii) do not
materially impair the use by the Company of such properties for the
respective purposes for which they are held by the Company;
(h) Liens vested in lessors, licensors, franchisors or permitters
for rent or other amounts to become due or for other obligations or acts
to be performed, the payment of which rent or the performance of which
other obligations or acts is required under leases, subleases, licenses,
franchises or permits, so long as the payment of such rent or other
amounts or the performance of such other obligations or acts is not
delinquent or is being contested in good faith and by appropriate
proceedings;
(i) controls, restrictions, obligations, duties and/or other burdens
imposed by federal, state, municipal or other law, or by rules,
regulations or orders of Governmental Authorities, upon the Mortgaged
Property or any part thereof or the operation or use thereof or upon the
Company with respect to the Mortgaged Property or any part thereof or the
operation or use thereof or with respect to any franchise, grant, license,
permit or public purpose requirement, or any rights reserved to or
otherwise vested in Governmental Authorities to impose any such controls,
restrictions, obligations, duties and/or other burdens;
(j) rights which Governmental Authorities may have by virtue of
franchises, grants, licenses, permits or contracts, or by virtue of law,
to purchase, recapture or designate a purchaser of or order the sale of
the Mortgaged Property or any part thereof, to terminate franchises,
grants, licenses, permits, contracts or other rights or to regulate the
property and business of the Company; and any and all obligations of the
Company correlative to any such rights;
(k) Liens required by law or governmental regulations (i) as a
condition to the transaction of any business or the exercise of any
privilege or license, (ii) to enable the
15
Company to maintain self-insurance or to participate in any funds
established to cover any insurance risks, (iii) in connection with
workmen's compensation, unemployment insurance, social security, any
pension or welfare benefit plan or (iv) to share in the privileges or
benefits required for companies participating in one or more of the
arrangements described in clauses (ii) and (iii) above;
(l) Liens on the Mortgaged Property or any part thereof which are
granted by the Company to secure duties or public or statutory obligations
or to secure, or serve in lieu of, surety, stay or appeal bonds;
(m) rights reserved to or vested in others to take or receive any
part of any coal, ore, gas, oil and other minerals, any timber and/or any
electric capacity or energy, gas, water, steam and any other products,
developed, produced, manufactured, generated, purchased or otherwise
acquired by the Company or by others on property of the Company;
(n) (i) rights and interests of Persons other than the Company
arising out of contracts, agreements and other instruments to which the
Company is a party and which relate to the common ownership or joint use
of property; and (ii) all Liens on the interests of Persons other than the
Company in property owned in common by such Persons and the Company if and
to the extent that the enforcement of such Liens would not adversely
affect the interests of the Company in such property in any material
respect;
(o) any restrictions on assignment and/or requirements of any
assignee to qualify as a permitted assignee and/or public utility or
public service corporation;
(p) any Liens which have been bonded for the full amount in dispute
or for the payment of which other adequate security arrangements have been
made;
(q) rights and interests granted pursuant to Section 8.02(c);
(r) Prepaid Liens; and
(s) the lien of the SPPC 1940 Mortgage and "permitted liens" or
"permitted encumbrances" as therein defined.
"Person" means any individual, corporation, partnership, limited
liability partnership, joint venture, trust or unincorporated organization or
any Governmental Authority.
"Place of Payment", when used with respect to the Securities of any
series, or any Tranche thereof, means the place or places, specified as
contemplated by Section 3.01, at which, subject to Section 6.02, principal of
and premium, if any, and interest, if any, on the Securities of such series or
Tranche are payable.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under
16
Section 3.06 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Security shall be deemed (to the extent lawful) to evidence the same debt
as the mutilated, destroyed, lost or stolen Security.
"Prepaid Lien" means any Lien securing indebtedness for the payment,
prepayment or redemption of which there shall have been irrevocably deposited in
trust with the trustee or other holder of such Lien moneys and/or Investment
Securities which (together with the interest reasonably expected to be earned
from the investment and reinvestment in Investment Securities of the moneys
and/or the principal of and interest on the Investment Securities so deposited)
shall be sufficient for such purpose; provided, however, that if such
indebtedness is to be redeemed or otherwise prepaid prior to the stated maturity
thereof, any notice requisite to such redemption or prepayment shall have been
given in accordance with the instrument creating such Lien or irrevocable
instructions to give such notice shall have been given to such trustee or other
holder; and provided, further, that the SPPC 1940 Mortgage shall not be deemed
to be a Prepaid Lien unless it shall have been satisfied and discharged and all
First Mortgage Bonds issued thereunder shall be deemed to have been paid, all in
accordance with the provisions thereof.
"Property Additions" has the meaning specified in Section 1.03.
"Purchase Money Lien" means, with respect to any property being
acquired or disposed of by the Company or being released from the Lien of this
Indenture, a Lien on such property which
(a) is taken or retained by the transferor of such property to
secure all or part of the purchase price thereof;
(b) is granted to one or more Persons other than the transferor
which, by making advances or incurring an obligation, give value to enable
the grantor of such Lien to acquire rights in or the use of such property;
(c) is granted to any other Person in connection with the release of
such property from the Lien of this Indenture on the basis of the deposit
with the Trustee or the trustee or other holder of a Lien prior to the
Lien of this Indenture of obligations secured by such Lien on such
property (as well as any other property subject thereto);
(d) is held by a trustee or agent for the benefit of one or more
Persons described in clause (a), (b) and/or (c) above, provided that such
Lien may be held, in addition, for the benefit of one or more other
Persons which shall have theretofore given, or may thereafter give, value
to or for the benefit or account of the grantor of such Lien for one or
more other purposes; or
(e) otherwise constitutes a purchase money mortgage or a
purchase money security interest under applicable law;
and, without limiting the generality of the foregoing, for purposes of this
Indenture, the term Purchase Money Lien shall be deemed to include any Lien
described above whether or not such
17
Lien (x) shall permit the issuance or other incurrence of additional
indebtedness secured by such Lien on such property, (y) shall permit the
subjection to such Lien of additional property and the issuance or other
incurrence of additional indebtedness on the basis thereof and/or (z) shall have
been granted prior to the acquisition, disposition or release of such property,
shall attach to or otherwise cover property other than the property being
acquired, disposed of or released and/or shall secure obligations issued prior
and/or subsequent to the issuance of the obligations delivered in connection
with such acquisition, disposition or release.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security 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 Securities of any series means the date specified for that
purpose as contemplated by Section 3.01.
"Required Currency" has the meaning specified in Section 3.11.
"Responsible Officer", when used with respect to the Trustee, means
any officer of the Trustee with direct responsibility for the administration of
this Indenture and also means, with respect to a particular corporate trust
matter, any other officer of the Trustee to whom such matter is referred because
of his knowledge of and familiarity with the particular subject.
"Retired Securities" means (a) any Securities authenticated and
delivered under this Indenture which (i) no longer remain Outstanding by reason
of the applicability of clause (a) or (b) in the definition of "Outstanding"
(other than any Predecessor Security of any Security), (ii) have not been made
the basis under any of the provisions of this Indenture of one or more
Authorized Purposes and (iii) have not been paid, redeemed, purchased or
otherwise retired by the application thereto of Funded Cash and (b) any First
Mortgage Bond authenticated and delivered under the SPPC 1940 Mortgage which (x)
at such time could be used as the basis for the authentication and delivery of
additional First Mortgage Bonds pursuant to the provisions of the SPPC 1940
Mortgage and (y) shall have been retired after the initial authentication and
delivery of the Securities of the Initial Series; provided, however, that, after
the delivery to the Trustee of the Initial Expert's Certificate, no Security and
no such First Mortgage Bond shall be deemed to be a Retired Security unless the
retirement thereof shall have occurred after such delivery of the Initial
Expert's Certificate.
"Securities" means any bonds, notes and other evidences of
indebtedness authenticated and delivered under this Indenture.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 3.05.
"Special Record Date" for the payment of any Defaulted Interest on
the Securities of any series means a date fixed by the Trustee pursuant to
Section 3.07.
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"SPPC 1940 Mortgage" means the Indenture of Mortgage, dated as of
December 1, 1940, from Sierra Pacific Power Company (the Company, successor) to
The New England Trust Company (State Street Bank and Trust Company, successor)
and Leo W. Huegle (Gerald R. Wheeler, successor), trustees, as heretofore and
hereafter amended and supplemented, which Indenture of Mortgage and amendments
and supplements thereto have been recorded and filed in the various official
records in the State of Nevada as set forth in Exhibit C hereto.
---------
"Stated Interest Rate" means a rate (whether fixed or variable) at
which an obligation by its terms is stated to bear simple interest. Any
calculation or other determination to be made under this Indenture by reference
to the Stated Interest Rate on an obligation shall be made (a) if the Company's
obligations in respect of any other indebtedness shall be evidenced or secured
in whole or in part by such obligation, by reference to the lower of the Stated
Interest Rate on such obligation and the Stated Interest Rate on such other
indebtedness and (b) without regard to the effective interest cost to the
Company of such obligation or of any such other indebtedness.
"Stated Maturity", when used with respect to any obligation or any
installment of principal thereof or interest thereon, means the date on which
the principal of such obligation or such installment of principal or interest is
stated to be due and payable (without regard to any provisions for redemption,
prepayment, acceleration, purchase or extension).
"Successor Corporation" has the meaning set forth in Section 13.01.
"Tranche" means a group of Securities which (a) are of the same
series and (b) have identical terms except as to principal amount and/or date of
issuance.
"Trust Indenture Act" means, as of any time, the Trust Indenture Act
of 1939, or any successor statute, as in effect at such time.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee, and, if at any time there is more
than one Person acting as trustee hereunder, "Trustee" shall mean each such
Person so acting.
"United States" means the United States of America, its Territories,
its possessions and other areas subject to its political jurisdiction.
SECTION 1.02 Funded Property; Funded Cash.
"Funded Property" means:
(a) all Property Additions to the extent that the same shall have
been designated in an Expert's Certificate delivered to the Trustee pursuant to
Section 7.02(c) to be deemed to be Funded Property;
19
(b) all Property Additions to the extent that the same shall have
been made the basis of the authentication and delivery of Securities under this
Indenture pursuant to Section 4.02;
(c) all Property Additions to the extent that the same shall have
been made the basis of the release of property from the Lien of this Indenture
pursuant to Section 8.03;
(d) all Property Additions to the extent that the same shall have
been substituted for Funded Property retired pursuant to Section 8.02;
(e) all Property Additions to the extent that the same shall have
been made the basis of the withdrawal of cash held by the Trustee pursuant to
Section 4.04 or 8.06; and
(f) all Property Additions to the extent that the same shall have
been used as the basis of a credit against, or otherwise in satisfaction of, the
requirements of any sinking, improvement, maintenance, replacement or similar
fund or analogous provision established with respect to the Securities of any
series, or any Tranche thereof, as contemplated by Section 3.01; provided,
however, that any such Property Additions shall cease to be Funded Property when
all of the Securities of such series or Tranche shall have been paid.
In the event that in any certificate filed with the Trustee in
connection with any of the transactions referred to in clauses (a), (b), (c),
(e) and (f) of this Section, only a part of the Cost or Fair Value of the
Property Additions described in such certificate shall be required for the
purposes of such certificate, then such Property Additions shall be deemed to be
Funded Property only to the extent so required for the purpose of such
certificate.
All Funded Property that shall be abandoned, destroyed, released or
otherwise disposed of shall for the purpose of Section 1.03 hereof be deemed
Funded Property retired and for other purposes of this Indenture shall thereupon
cease to be Funded Property but as in this Indenture provided may at any time
thereafter again become Funded Property. Neither any reduction in the Cost or
book value of property recorded in the plant account of the Company, nor the
transfer of any amount appearing in such account to intangible and/or adjustment
accounts, otherwise than in connection with actual retirements of physical
property abandoned, destroyed, released or disposed of, and otherwise than in
connection with the removal of such property in its entirety from plant account,
shall be deemed to constitute a retirement of Funded Property.
The Company may make allocations, on a pro-rata or other reasonable
basis (including, but not limited to, the designation of specific properties or
the designation of all or a specified portion of the properties reflected in one
or more generic accounts or subaccounts in the Company's books of account), for
the purpose of determining the extent to which fungible properties, or other
properties not otherwise identified, reflected in the same generic account or
subaccount in the Company's books of account constitute Funded Property or
Funded Property retired.
"Funded Cash" means:
20
(a) cash, held by the Trustee hereunder, to the extent that it
represents the proceeds of insurance on Funded Property (except as
otherwise provided in Section 6.07), or cash deposited in connection with
the release of Funded Property pursuant to Article VIII, or the payment of
the principal of, or the proceeds of the release of, obligations secured
by Purchase Money Lien and delivered to the Trustee pursuant to Article
VIII, all subject, however, to the provisions of Section 6.07 and Section
8.06; and
(b) any cash deposited with the Trustee under Section 4.04.
SECTION 1.03 Property Additions; Cost.
(a) "Property Additions" means, as of any particular time, any item,
unit or element of property which at such time is owned by the Company and is
subject to the Lien of this Indenture; provided, however, that Property
Additions shall not include:
(i) goodwill, going concern value rights or intangible
property except as provided in subsection (c) of this Section; or
(ii) any property the cost of acquisition or construction of
which is, in accordance with generally accepted accounting principles,
properly chargeable to an operating expense account of the Company.
(b) When any Property Additions are certified to the Trustee as the
basis of any Authorized Purpose (except as otherwise provided in Section 8.03
and Section 8.06),
(i) there shall be deducted from the Cost or Fair Value to the
Company thereof, as the case may be (as of the date so certified), an
amount equal to the Cost (or as to Property Additions of which the Fair
Value to the Company at the time the same became Funded Property was
certified to be an amount less than the Cost as determined pursuant to
this Section, then such Fair Value, as so certified, in lieu of Cost) of
all Funded Property of the Company retired to the date of such
certification (other than the Funded Property, if any, in connection with
the application for the release of which such certificate is filed) and
not theretofore deducted from the Cost or Fair Value to the Company of
Property Additions theretofore certified to the Trustee, and
(ii) there may, at the option of the Company, be added to such
Cost or Fair Value, as the case may be, the sum of
(A) the principal amount of any obligations secured by
Purchase Money Lien, not theretofore so added and which the Company
then elects so to add, which shall theretofore have been delivered
to the Trustee or the trustee or other holder of a Lien prior to the
Lien of this Indenture as the basis of the release of Funded
Property retired from the Lien of this Indenture or such prior Lien,
as the case may be;
(B) ten-sevenths (10/7) of the amount of any cash, not
theretofore so added and which the Company then elects so to add,
which shall theretofore have been delivered to the Trustee or the
trustee or other holder of a
21
Lien prior to the Lien of this Indenture as the proceeds of
insurance on Funded Property retired (to the extent of the portion
thereof deemed to be Funded Cash) or as the basis of the release of
Funded Property retired from the Lien of this Indenture or from such
prior Lien, as the case may be;
(C) ten-sevenths (10/7) of the principal amount of any
Security or Securities, or portion of such principal amount, not
theretofore so added and which the Company then elects so to add,
(I) which shall theretofore have been delivered to the Trustee as
the basis of the release of Funded Property retired or (II) the
right to the authentication and delivery of which under the
provisions of Section 4.03 shall at any time theretofore have been
waived under Section 8.03(d)(iii) as the basis of the release of
Funded Property retired;
(D) the Cost or Fair Value to the Company (whichever
shall be less), after making any deductions and any additions
pursuant to this Section, of any Property Additions, not theretofore
so added and which the Company then elects so to add, which shall
theretofore have been made the basis of the release of Funded
Property retired (such Fair Value to be the amount shown in the
Expert's Certificate delivered to the Trustee in connection with
such release); and
(E) the Cost to the Company of any Property Additions
(including Property Additions subject to the Lien of the SPPC 1940
Mortgage) not theretofore so added and which the Company then elects
so to add, to the extent that the same shall have been substituted
for Funded Property retired;
provided, however, that the aggregate of the amounts added under clause
(ii) above shall in no event exceed the amounts deducted under clause (i)
above.
(c) Except as otherwise provided in Section 8.03, the term "Cost"
with respect to Property Additions shall mean the sum of (i) any cash delivered
in payment therefor or for the acquisition thereof, (ii) an amount equivalent to
the fair market value in cash (as of the date of delivery) of any securities or
other property delivered in payment therefor or for the acquisition thereof,
(iii) the principal amount of any obligations secured by prior Lien (other than
the SPPC 1940 Mortgage) upon such Property Additions outstanding at the time of
the acquisition thereof, (iv) the principal amount of any other obligations
incurred or assumed in connection with the payment for such Property Additions
or for the acquisition thereof and (v) any other amounts which, in accordance
with generally accepted accounting principles, are properly charged or
chargeable to the plant or other property accounts of the Company with respect
to such Property Additions as part of the cost of construction or acquisition
thereof, including, but not limited to, any allowance for funds used during
construction or any similar or analogous amount; provided, however, that,
notwithstanding any other provision of this Indenture,
(x) with respect to Property Additions owned by a successor
corporation immediately prior to the time it shall have become such by
consolidation or merger or acquired by a successor corporation in or as a
result of a consolidation or merger (excluding, in any case, Property
Additions owned by the Company immediately prior to such time), Cost shall
mean the amount or amounts at which such Property
22
Additions are recorded in the plant or other property accounts of such
successor corporation, or the predecessor corporation from which such
Property Additions are acquired, as the case may be, immediately prior to
such consolidation or merger;
(y) with respect to Property Additions which shall have been
acquired (otherwise than by construction) by the Company without any
consideration consisting of cash, securities or other property or the
incurring or assumption of indebtedness, no determination of Cost shall be
required, and, wherever in this Indenture provision is made for Cost or
Fair Value, Cost with respect to such Property Additions shall mean an
amount equal to the Fair Value to the Company thereof or, if greater, the
aggregate amount reflected in the Company's books of account with respect
thereto upon the acquisition thereof; and
(z) in no event shall the Cost of Property Additions be
required to reflect any depreciation or amortization in respect of such
Property Additions, or any adjustment to the amount or amounts at which
such Property Additions are recorded in plant or other property accounts
due to the non-recoverability of investment or otherwise.
If any Property Additions are shown by the Expert's Certificate
provided for in Section 4.02 (b)(ii) to include property which has been used or
operated by others than the Company in a business similar to that in which it
has been or is to be used or operated by the Company, the Cost thereof need not
be reduced by any amount in respect of any goodwill, going concern value rights
and/or intangible property simultaneously acquired for which no separate or
distinct consideration shall have been paid or apportioned, and in such case the
term Property Additions as defined herein may include such goodwill, going
concern value rights and intangible property.
SECTION 1.04 Compliance Certificates and Opinions.
Except as otherwise expressly provided in this Indenture, 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 an
Officer's Certificate stating that all conditions precedent, if any, provided
for in this Indenture relating to the proposed action have been complied with
and an Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with, it being understood that
in the case of any such application or request as to which the furnishing of
such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(a) a statement that each Person signing such certificate or opinion
has read such covenant or condition and the definitions herein relating thereto;
(b) 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;
23
(c) a statement that, in the opinion of each such Person, such
Person has made such examination or investigation as is necessary to enable such
Person to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(d) a statement as to whether, in the opinion of each such Person,
such condition or covenant has been complied with.
SECTION 1.05 Content and Form of Documents Delivered to Trustee.
(a) Any Officer's Certificate may be based (without further
examination or investigation), insofar as it relates to or is dependent upon
legal matters, upon an opinion of, or representations by, counsel, and, insofar
as it relates to or is dependent upon matters which are subject to verification
by Accountants, upon a certificate or opinion of, or representations by, an
Accountant, and, insofar as it relates to or is dependent upon matters which are
required in this Indenture to be covered by a certificate or opinion of, or
representations by, an Expert, upon the certificate or opinion of, or
representations by, an Expert, unless, in any case, such officer has actual
knowledge that the certificate or opinion or representations with respect to the
matters upon which such Officer's Certificate may be based as aforesaid are
erroneous.
Any Expert's Certificate may be based (without further examination
or investigation), insofar as it relates to or is dependent upon legal matters,
upon an opinion of, or representations by, counsel, and insofar as it relates to
or is dependent upon factual matters, information with respect to which is in
the possession of the Company and which are not subject to verification by
Experts, upon a certificate or opinion of, or representations by, an officer or
officers of the Company, unless such Expert has actual knowledge that the
certificate or opinion or representations with respect to the matters upon which
his certificate or opinion may be based as aforesaid are erroneous.
Any certificate of an Accountant may be based (without further
examination or investigation), insofar as it relates to or is dependent upon
legal matters, upon an opinion of, or representations by, counsel, and insofar
as it relates to or is dependent upon factual matters, information with respect
to which is in the possession of the Company and which are not subject to
verification by Accountants, upon a certificate of, or representations by, an
officer or officers of the Company, unless such Accountant has actual knowledge
that the certificate or opinion or representations with respect to the matters
upon which his certificate or opinion may be based as aforesaid are erroneous.
Any Opinion of Counsel may be based (without further examination or
investigation), insofar as it relates to or is dependent upon factual matters,
information with respect to which is in the possession of the Company, upon a
certificate of, or representations by, an officer or officers of the Company,
and, insofar as it relates to or is dependent upon matters which are subject to
verification by Accountants upon a certificate or opinion of, or representations
by, an Accountant, and, insofar as it relates to or is dependent upon matters
required in this Indenture to be covered by a certificate or opinion of, or
representations by, an Expert, upon the certificate or opinion of, or
representations by, an Expert, unless such counsel has actual knowledge that the
certificate or opinion or representations with respect to the matters upon which
his opinion may be based as aforesaid are erroneous. In addition, any Opinion of
24
Counsel may be based (without further examination or investigation), insofar as
it relates to or is dependent upon matters covered in an Opinion of Counsel
rendered by other counsel, upon such other Opinion of Counsel, unless such
counsel has actual knowledge that the Opinion of Counsel rendered by such other
counsel with respect to the matters upon which his Opinion of Counsel may be
based as aforesaid are erroneous. Further, any Opinion of Counsel with respect
to the status of title to or the sufficiency of descriptions of property, and/or
the existence of Liens thereon, and/or the recording or filing of documents,
and/or any similar matters, may be based (without further examination or
investigation) upon (i) title insurance policies or commitments and reports,
lien search certificates and other similar documents or (ii) certificates of, or
representations by, officers, employees, agents and/or other representatives of
the Company or (iii) any combination of the documents referred to in (i) and
(ii), unless, in any case, such counsel has actual knowledge that the document
or documents with respect to the matters upon which his opinion may be based as
aforesaid are erroneous. If, in order to render any Opinion of Counsel provided
for herein, the signer thereof shall deem it necessary that additional facts or
matters be stated in any Officer's Certificate, certificate of an Accountant or
Expert's Certificate provided for herein, then such certificate may state all
such additional facts or matters as the signer of such Opinion of Counsel may
request.
(b) In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents. Where any
Person is required to make, give or execute two or more applications, requests,
consents, certificates, statements, opinions or other instruments under this
Indenture, they may, but need not, be consolidated and form one instrument.
(c) Whenever, subsequent to the receipt by the Trustee of any Board
Resolution, Officer's Certificate, Expert's Certificate, Net Earnings
Certificate, Opinion of Counsel or other document or instrument, a clerical,
typographical or other inadvertent or unintentional error or omission shall be
discovered therein, a new document or instrument may be substituted therefor in
corrected form with the same force and effect as if originally filed in the
corrected form and, irrespective of the date or dates of the actual execution
and/or delivery thereof, such substitute document or instrument shall be deemed
to have been executed and/or delivered as of the date or dates required with
respect to the document or instrument for which it is substituted. Anything in
this Indenture to the contrary notwithstanding, if any such corrective document
or instrument indicates that action has been taken by or at the request of the
Company which could not have been taken had the original document or instrument
not contained such error or omission, the action so taken shall not be
invalidated or otherwise rendered ineffective but shall be and remain in full
force and effect, except to the extent that such action was a result of willful
misconduct or bad faith. Without limiting the generality of the foregoing, any
Securities issued under the authority of such defective document or instrument
shall nevertheless be the valid obligations of the Company entitled to the
benefit of the Lien of this Indenture equally and ratably with all other
Outstanding Securities, except as aforesaid.
25
SECTION 1.06 Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent,
election, waiver or other action provided by this Indenture to be made, given 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 an agent duly
appointed in writing or, alternatively, may be embodied in and evidenced by the
record of Holders voting in favor thereof, either in person or by proxies duly
appointed in writing, at any meeting of Holders duly called and held in
accordance with the provisions of Article XV, or a combination of such
instruments and any such record. Except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments or record
or both are delivered to the Trustee and, where it is hereby expressly required,
to the Company. Such instrument or instruments and any such record (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Holders signing such instrument or instruments and so voting
at any such meeting. Proof of execution of any such instrument or of a writing
appointing any such agent, or of the holding by any Person of a Security, shall
be sufficient for any purpose of this Indenture and (subject to Section 11.01)
conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section. The record of any meeting of Holders shall be proved
in the manner provided in Section 15.06.
(b) 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 or may be
proved in any other manner which the Trustee and the Company deem sufficient.
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.
(c) The principal amount (except as otherwise contemplated in clause
(y) of the first proviso to the definition of Outstanding) and serial numbers of
Securities held by any Person, and the date of holding the same, shall be proved
by the Security Register.
(d) Any request, demand, authorization, direction, notice, consent,
election, waiver or other Act of a Holder shall bind every future Holder of the
same Security and the Holder of every Security 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
Security.
(e) Until such time as written instruments shall have been delivered
to the Trustee with respect to the requisite percentage of principal amount of
Securities for the action contemplated by such instruments, any such instrument
executed and delivered by or on behalf of a Holder may be revoked with respect
to any or all of such Securities by written notice by such Holder or any
subsequent Holder, proven in the manner in which such instrument was proven.
(f) Securities of any series, or any Tranche thereof, authenticated
and delivered after any Act of Holders may, and shall if required by the
Trustee, bear a notation in
26
form approved by the Trustee as to any action taken by such Act of Holders. If
the Company shall so determine, new Securities of any series, or any Tranche
thereof, so modified as to conform, in the opinion of the Trustee and the
Company, to such action may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding
Securities of such series or Tranche.
(g) The Company may, at its option, by Company Order, fix in advance
a record date for the determination of Holders entitled to give any request,
demand, authorization, direction, notice, consent, waiver or other Act solicited
by the Company, but the Company shall have no obligation to do so. In addition,
the Trustee may, at its option, fix in advance a record date for the
determination of Holders entitled to join in the giving or making of any Notice
of Default, any declaration of acceleration referred to in Section 10.02, any
request to institute proceedings referred to in Section 10.11 or any direction
referred to in Section 10.16. If any such record date is fixed, such request,
demand, authorization, direction, notice, consent, waiver or other Act, or such
notice, declaration, request or direction, may be given before or after such
record date, but only the Holders of record at the close of business on the
record date shall be deemed to be Holders for the purposes of determining (i)
whether Holders of the requisite proportion of the Outstanding Securities have
authorized or agreed or consented to such Act (and for that purpose the
Outstanding Securities shall be computed as of the record date) and/or (ii)
which Holders may revoke any such Act (notwithstanding subsection (e) of this
Section).
SECTION 1.07 Notices, Etc. to Trustee and Company.
Except as otherwise provided herein, any request, demand,
authorization, direction, notice, consent, election, 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, the Trustee by any Holder or by the Company, or the
Company by the Trustee or by any Holder, shall be sufficient for every purpose
hereunder (unless otherwise expressly provided herein) if the same shall be in
writing and delivered personally to an officer or other responsible employee of
the addressee, or transmitted by facsimile transmission or other direct written
electronic means to such telephone number or other electronic communications
address as the parties hereto shall from time to time designate, or transmitted
by registered mail, charges prepaid, to the applicable address set opposite such
party's name below or to such other address as either party hereto may from time
to time designate:
If to the Trustee, to:
The Bank of New York
101 Barclay Street, Floor 21W
New York, New York 10286
Attention: Corporate Trust Administration
27
If to the Company, to:
Sierra Pacific Power Company
P.O. Box 30150
6100 Neil Road
Reno, Nevada 89520
Attention: Treasurer
Any communication contemplated herein shall be deemed to have been
made, given, furnished and filed if personally delivered, on the date of
delivery, if transmitted by facsimile transmission or other direct written
electronic means, on the date of transmission, and if transmitted by registered
mail, on the date of receipt.
SECTION 1.08 Notice to Holders of Securities; Waiver.
Except as otherwise expressly provided herein, where this Indenture
provides for notice to Holders of any event, such notice shall be sufficiently
given, and shall be deemed given, to Holders if in writing and mailed,
first-class postage prepaid, to each Holder affected by such event, at the
address of such Holder as it appears in the Security Register, not later than
the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice.
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 to
Holders by mail, then such notification as shall be made with the approval of
the Trustee shall constitute a sufficient notification for every purpose
hereunder. 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.
Any notice required by this Indenture may be waived in writing by
the Person entitled to receive such notice, either before or after the event
otherwise to be specified therein, 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.
SECTION 1.09 Conflict with Trust Indenture Act.
If any provision of this Indenture limits, qualifies or conflicts
with another provision hereof which is required or deemed to be included in this
Indenture by, or is otherwise governed by, any provision of the Trust Indenture
Act, such other provision shall control; and if any provision hereof otherwise
conflicts with the Trust Indenture Act, the Trust Indenture Act shall control.
SECTION 1.10 Effect of Headings and Table of Contents.
The Article and Section headings in this Indenture and the Table of
Contents are for convenience only and shall not affect the construction hereof.
28
SECTION 1.11 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 1.12 Separability Clause.
In case any provision in this Indenture or the Securities shall be
held to 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 1.13 Benefits of Indenture.
Nothing in this Indenture or the Securities, express or implied,
shall give to any Person, other than the parties hereto, their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this Indenture.
SECTION 1.14 Governing Law.
This Indenture and the Securities shall be governed by and construed
in accordance with the law of the State of New York (including without
limitation Section 5-1401 of the New York General Obligations Law or any
successor to such statute), except to the extent that the Trust Indenture Act
shall be applicable and except to the extent that the law of any jurisdiction
wherein any portion of the Mortgaged Property is located shall mandatorily
govern the creation of a mortgage lien on and security interest in, or
perfection, priority or enforcement of the Lien of this Indenture or exercise of
remedies with respect to, such portion of the Mortgaged Property.
SECTION 1.15 Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or
Stated Maturity of any Security shall not be a Business Day at any Place of
Payment, then (notwithstanding any other provision of this Indenture or of the
Securities other than a provision in Securities of any series, or any Tranche
thereof, or in the indenture supplemental hereto, Board Resolution or Officer's
Certificate which establishes the terms of the Securities of such series or
Tranche, 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, and, if such payment is made or duly provided for on such Business
Day, no interest shall accrue on the amount so payable for the period from and
after such Interest Payment Date, Redemption Date or Stated Maturity, as the
case may be, to such Business Day.
SECTION 1.16 Investment of Cash Held by Trustee.
Any cash held by the Trustee or any Paying Agent under any provision
of this Indenture shall, except as otherwise provided in Section 8.06 or in
Article IX, at the request of the Company evidenced by Company Order, be
invested or reinvested in Investment Securities
29
designated by the Company (such Company Order to contain a representation to the
effect that the securities designated therein constitute Investment Securities),
and any interest on such Investment Securities shall be promptly paid over to
the Company as received free and clear of any Lien. Such Investment Securities
shall be held subject to the same provisions hereof as the cash used to purchase
the same, but upon a like request of the Company shall be sold, in whole or in
designated part, and the proceeds of such sale shall be held subject to the same
provisions hereof as the cash used to purchase the Investment Securities so
sold. If such sale shall produce a net sum less than the cost of the Investment
Securities so sold, the Company shall pay to the Trustee or any such Paying
Agent, as the case may be, such amount in cash as, together with the net
proceeds from such sale, shall equal the cost of the Investment Securities so
sold, and if such sale shall produce a net sum greater than the cost of the
Investment Securities so sold, the Trustee or any such Paying Agent, as the case
may be, shall promptly pay over to the Company an amount in cash equal to such
excess, free and clear of any Lien. In no event shall the Trustee be liable for
any loss incurred in connection with the sale of any Investment Security
pursuant to this Section.
Notwithstanding the foregoing, if an Event of Default shall have
occurred and be continuing, interest on Investment Securities and any gain upon
the sale thereof shall be held as part of the Mortgaged Property until such
Event of Default shall have been cured or waived, whereupon such interest and
gain shall be promptly paid over to the Company free and clear of any Lien.
ARTICLE II
----------
SECURITY FORMS
--------------
SECTION 2.01 Forms Generally.
The definitive Securities of each series shall be in substantially
the form or forms established in the indenture supplemental hereto establishing
such series, or in a Board Resolution establishing such series, or in an
Officer's Certificate pursuant to such a supplemental indenture or Board
Resolution, in any 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 as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution of the Securities. If the form or forms of Securities of any series
are established in a Board Resolution or in an Officer's Certificate pursuant to
a supplemental indenture or a Board Resolution, such Board Resolution and
Officer's Certificate, if any, shall be delivered to the Trustee at or prior to
the delivery of the Company Order contemplated by Section 4.01 for the
authentication and delivery of such Securities.
The Securities of each series shall be issuable in registered form
without coupons. The definitive Securities shall be produced in such manner as
shall be determined by the officers executing such Securities, as evidenced by
their execution thereof.
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SECTION 2.02 Form of Trustee's Certificate of Authentication.
The Trustee's certificate of authentication shall be in
substantially the form set forth below:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
THE BANK OF NEW YORK, as Trustee
By:
-------------------------------
Authorized Signatory
ARTICLE III
-----------
THE SECURITIES
--------------
SECTION 3.01 Amount Unlimited; Issuable in Series.
Subject to the provisions of Article IV, the aggregate principal
amount of Securities which may be authenticated and delivered under this
Indenture is unlimited.
The Securities may be issued in one or more series. Subject to the
penultimate paragraph of this Section, prior to the authentication and delivery
of Securities of any series there shall be established by specification in a
supplemental indenture or in a Board Resolution, or in an Officer's Certificate
pursuant to a supplemental indenture or a Board Resolution:
(a) the title of the Securities of such series (which shall
distinguish the Securities of such series from Securities of all other series);
(b) any limit upon the aggregate principal amount of the Securities
of such series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Securities of such series pursuant
to Section 3.04, 3.05, 3.06, 5.06 or 14.06 and except for any Securities which,
pursuant to Section 3.03, are deemed never to have been authenticated and
delivered hereunder);
(c) the Persons (without specific identification) to whom interest
on Securities of such series, or any Tranche thereof, shall be payable on any
Interest Payment Date, if other than the Persons in whose names such Securities
(or one or more Predecessor Securities) are registered at the close of business
on the Regular Record Date for such interest;
(d) the date or dates on which the principal of the Securities of
such series, or any Tranche thereof, is payable or any formulary or other method
or other means by which such date or dates shall be determined, by reference to
an index or other fact or event ascertainable
31
outside of this Indenture or otherwise (without regard to any provisions for
redemption, prepayment, acceleration, purchase or extension);
(e) the rate or rates at which the Securities of such series, or any
Tranche thereof, shall bear interest, if any (including the rate or rates at
which overdue principal shall bear interest, if different from the rate or rates
at which such Securities shall bear interest prior to Maturity, and, if
applicable, the rate or rates at which overdue premium or interest shall bear
interest, if any), or any formulary or other method or other means by which such
rate or rates shall be determined, by reference to an index or other fact or
event ascertainable outside of this Indenture or otherwise; the date or dates
from which such interest shall accrue; the Interest Payment Dates on which such
interest shall be payable and the Regular Record Date, if any, for the interest
payable on such Securities on any Interest Payment Date; and the basis of
computation of interest, if other than as provided in Section 3.10;
(f) the place or places at which and/or the methods (if other than
as provided elsewhere in this Indenture) by which (i) the principal of and
premium, if any, and interest, if any, on Securities of such series, or any
Tranche thereof, shall be payable, (ii) registration of transfer of Securities
of such series, or any Tranche thereof, may be effected, (iii) exchanges of
Securities of such series, or any Tranche thereof, may be effected and (iv)
notices and demands to or upon the Company in respect of the Securities of such
series, or any Tranche thereof, and this Indenture may be served; the Security
Registrar and any Paying Agent or Agents for such series or Tranche; and, if
such is the case, that the principal of such Securities shall be payable without
the presentment or surrender thereof;
(g) the period or periods within which or the date or dates on
which, the price or prices at which and the terms and conditions upon which the
Securities of such series, or any Tranche thereof, may be redeemed, in whole or
in part, at the option of the Company;
(h) the obligation or obligations, if any, of the Company to redeem
or purchase the Securities of such series, or any Tranche thereof, pursuant to
any sinking fund or other mandatory redemption provisions or at the option of a
Holder thereof and the period or periods within which or the date or dates on
which, the price or prices at which and the terms and conditions upon which such
Securities shall be redeemed or purchased, in whole or in part, pursuant to such
obligation, and applicable exceptions to the requirements of Section 5.04 in the
case of mandatory redemption or redemption at the option of the Holder;
(i) the denominations in which Securities of such series, or any
Tranche thereof, shall be issuable if other than denominations of One Thousand
Dollars ($1,000) and any integral multiple thereof;
(j) the currency or currencies, including composite currencies, in
which payment of the principal of and premium, if any, and interest, if any, on
the Securities of such series, or any Tranche thereof, shall be payable (if
other than in Dollars); it being understood that, for purposes of calculations
under this Indenture (including calculations of principal amount under Article
IV), any amounts denominated in a currency other than Dollars or in a composite
currency shall be converted to Dollar equivalents by calculating the amount of
Dollars which
32
could have been purchased by the amount of such other currency based on such
quotations or methods of determination as shall be specified pursuant to this
clause (j);
(k) if the principal of or premium, if any, or interest, if any, on
the Securities of such series, or any Tranche thereof, are to be payable, at the
election of the Company or a Holder thereof, in a coin or currency other than
that in which the Securities are stated to be payable, the coin or currency in
which payment of any amount as to which such election is made will be payable,
the period or periods within which, and the terms and conditions upon which,
such election may be made; it being understood that, for purposes of
calculations under this Indenture (including calculations of principal amount
under Article IV), any such election shall be required to be taken into account,
in the manner contemplated in clause (j) of this paragraph, only after such
election shall have been made;
(l) if the principal of or premium, if any, or interest, if any, on
the Securities of such series, or any Tranche thereof, are to be payable, or are
to be payable at the election of the Company or a Holder thereof, in securities
or other property, the type and amount of such securities or other property, or
the formulary or other method or other means by which such amount shall be
determined, and the period or periods within which, and the terms and conditions
upon which, any such election may be made; it being understood that all
calculations under this Indenture (including calculations of principal amount
under Article IV) shall be made on the basis of the fair market value of such
securities or the Fair Value of such other property, in either case determined
as of the most recent practicable date, except that, in the case of any amount
of principal or interest that may be so payable at the election of the Company
or a Holder, if such election shall not yet have been made, such calculations
shall be made on the basis of the amount of principal or interest, as the case
may be, that would be payable if no such election were made;
(m) if the amount payable in respect of principal of or premium, if
any, or interest, if any, on the Securities of such series, or any Tranche
thereof, may be determined with reference to an index or other fact or event
ascertainable outside of this Indenture, the manner in which such amounts shall
be determined (to the extent not established pursuant to clause (e) of this
paragraph); it being understood that all calculations under this Indenture
(including calculations of principal amount under Article IV) shall be made on
the basis of the amount that would be payable as principal if such principal
were due, or on the basis of the interest rates in effect, as the case may be,
on the date next preceding the date of such calculation;
(n) if other than the principal amount thereof, the portion of the
principal amount of Securities of such series, or any Tranche thereof, which
shall be payable upon declaration of acceleration of the Maturity thereof
pursuant to Section 10.02;
(o) the terms, if any, pursuant to which the Securities of such
series, or any Tranche thereof, may be converted into or exchanged for shares of
capital stock or other securities of the Company or any other Person;
(p) the obligations or instruments, if any, which shall be
considered to be Eligible Obligations in respect of the Securities of such
series, or any Tranche thereof, denominated in a currency other than Dollars or
in a composite currency, and any additional or
33
alternative provisions for the reinstatement of the Company's indebtedness in
respect of such Securities after the satisfaction and discharge thereof as
provided in Section 9.01;
(q) if the Securities of such series, or any Tranche thereof, are to
be issued in global form, (i) any limitations on the rights of the Holder or
Holders of such Securities to transfer or exchange the same or to obtain the
registration of transfer thereof, (ii) any limitations on the rights of the
Holder or Holders thereof to obtain certificates therefor in definitive form in
lieu of temporary form and (iii) any and all other matters incidental to such
Securities;
(r) if the Securities of such series, or any Tranche thereof, are to
be issuable as bearer securities, any and all matters incidental thereto which
are not specifically addressed in a supplemental indenture as contemplated by
clause (f) of Section 14.01;
(s) to the extent not established pursuant to clause (q) of this
paragraph, any limitations on the rights of the Holders of the Securities of
such Series, or any Tranche thereof, to transfer or exchange such Securities or
to obtain the registration of transfer thereof; and if a service charge will be
made for the registration of transfer or exchange of Securities of such series,
or any Tranche thereof, the amount or terms thereof;
(t) any exceptions to Section 1.15, or variation in the definition
of Business Day, with respect to the Securities of such series, or any Tranche
thereof; and
(u) any other terms of the Securities of such series, or any Tranche
thereof.
With respect to Securities of a series subject to a Periodic
Offering, the indenture supplemental hereto or the Board Resolution which
establishes such series, or the Officer's Certificate pursuant to such
supplemental indenture or Board Resolution, as the case may be, may provide
general terms or parameters for Securities of such series and provide either
that the specific terms of Securities of such series, or any Tranche thereof,
shall be specified in a Company Order or that such terms shall be determined by
the Company or its agents in accordance with procedures specified in a Company
Order as contemplated by clause (b) of Section 4.01.
Anything herein to the contrary notwithstanding, the Trustee shall
be under no obligation to authenticate and deliver Securities of any series the
terms of which, established as contemplated by this Section, would affect the
rights, duties, obligations, liabilities or immunities of the Trustee under this
Indenture or otherwise.
SECTION 3.02 Denominations.
Unless otherwise provided as contemplated by Section 3.01 with
respect to any series of Securities, or any Tranche thereof, the Securities of
each series shall be issuable in denominations of One Thousand Dollars ($1,000)
and any integral multiple thereof.
SECTION 3.03 Execution, Dating, Certificate of Authentication.
Unless otherwise provided as contemplated by Section 3.01 with
respect to any series of Securities, or any Tranche thereof, the Securities
shall be executed on behalf of the
34
Company by an Authorized Officer, and may have the corporate seal of the Company
affixed thereto or reproduced thereon and attested by any other Authorized
Officer. The signature of any or all of these officers on the Securities may be
manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at the time of execution Authorized 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 Securities or
did not hold such offices at the date of such Securities.
Unless otherwise specified as contemplated by Section 3.01 with
respect to any series of Securities, or any Tranche thereof, each Security shall
be dated the date of its authentication.
Unless otherwise specified as contemplated by Section 3.01 with
respect to any series of Securities, or any Tranche thereof, no Security shall
be entitled to any benefit under this Indenture or be valid or obligatory for
any purpose unless there appears on such Security a certificate of
authentication substantially in the form provided for herein executed by the
Trustee or an Authenticating Agent by manual signature of an authorized officer
thereof, and such certificate upon any Security shall be conclusive evidence,
and the only evidence, that such Security has been duly authenticated and
delivered hereunder and is entitled to the benefits of this Indenture.
Notwithstanding the foregoing, if (a) any Security shall have been authenticated
and delivered hereunder to the Company, or any Person acting on its behalf, but
shall never have been issued and sold by the Company, (b) the Company shall
deliver such Security to the Security Registrar for cancellation or shall cancel
such Security and deliver evidence of such cancellation to the Trustee, in each
case as provided in Section 3.09, and (c) the Company, at its election, shall
deliver to the Trustee a written statement (which need not comply with Section
1.04 and need not be accompanied by an Officer's Certificate or an Opinion of
Counsel) stating that such Security has never been issued and sold by the
Company, then, for all purposes of this Indenture, such Security shall be deemed
never to have been authenticated and delivered hereunder and shall never be
entitled to the benefits hereof.
SECTION 3.04 Temporary Securities.
Pending the preparation of definitive Securities of any series, or
any Tranche thereof, the Company may execute, and upon Company Order the Trustee
shall authenticate and deliver, temporary Securities which are printed,
lithographed, typewritten, mimeographed, photocopied or otherwise produced, in
any authorized denomination, substantially of the tenor of the definitive
Securities in lieu of which they are issued, with such appropriate insertions,
omissions, substitutions and other variations as the officers executing such
Securities may determine, as evidenced by their execution of such Securities;
provided, however, that temporary Securities need not recite specific
redemption, sinking fund, conversion or exchange provisions.
Except as otherwise specified as contemplated by Section 3.01 with
respect to the Securities of any series, or any Tranche thereof, after the
preparation of definitive Securities of such series or Tranche, the temporary
Securities of such series or Tranche shall be exchangeable, without charge to
the Holder thereof, for definitive Securities of such series or Tranche upon
35
surrender of such temporary Securities at the office or agency of the Company
maintained pursuant to Section 6.02 in a Place of Payment for such Securities.
Upon such surrender of temporary Securities, the Company shall, except as
aforesaid, execute and the Trustee shall authenticate and deliver in exchange
therefor definitive Securities of the same series and Tranche, of authorized
denominations and of like tenor and aggregate principal amount.
Until exchanged in full as hereinabove provided, temporary
Securities shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities of the same series and Tranche and of like
tenor authenticated and delivered hereunder.
SECTION 3.05 Registration, Registration of Transfer and Exchange.
The Company shall cause to be kept in one of the offices designated
pursuant to Section 6.02, with respect to the Securities of each series, or any
Tranche thereof, a register (the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities of such series or Tranche and the registration of
transfer thereof. The Company shall designate one Person to maintain the
Security Register for the Securities of each series, and such Person is referred
to herein, with respect to such series, as the "Security Registrar". Anything
herein to the contrary notwithstanding, the Company may designate one or more of
its offices as an office in which a register with respect to the Securities of
one or more series, or any Tranche or Tranches thereof, shall be maintained, and
the Company may designate itself the Security Registrar with respect to one or
more of such series. The Security Register shall be open for inspection by the
Trustee and the Company at all reasonable times.
Except as otherwise specified as contemplated by Section 3.01 with
respect to the Securities of any series, or any Tranche thereof, upon surrender
for registration of transfer of any Security of such series or Tranche at the
office or agency of the Company maintained pursuant to Section 6.02 in a Place
of Payment for such series or Tranche, the Company shall execute, and the
Trustee shall authenticate and deliver, in the name of the designated transferee
or transferees, one or more new Securities of the same series and Tranche, of
authorized denominations and of like tenor and aggregate principal amount.
Except as otherwise specified as contemplated by Section 3.01 with
respect to the Securities of any series, or any Tranche thereof, any Security of
such series or Tranche may be exchanged at the option of the Holder, for one or
more new Securities of the same series and Tranche, of authorized denominations
and of like tenor and aggregate principal amount, upon surrender of the
Securities to be exchanged at any such office or agency. Whenever any Securities
are so surrendered for exchange, the Company shall execute, and the Trustee
shall authenticate and deliver, the Securities which the Holder making the
exchange is entitled to receive.
All Securities delivered upon any registration of transfer or
exchange of Securities shall be valid obligations of the Company, evidencing the
same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
36
Every Security presented or surrendered for registration of transfer
or for exchange shall (if so required by the Company, the Trustee or the
Security Registrar) be duly endorsed or shall be accompanied by a written
instrument of transfer in form satisfactory to the Company, the Trustee or the
Security Registrar, as the case may be, duly executed by the Holder thereof or
his attorney duly authorized in writing.
Unless otherwise specified as contemplated by Section 3.01 with
respect to Securities of any series, or any Tranche thereof, no service charge
shall be made for any registration of transfer or exchange of Securities, 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 Securities, other than exchanges pursuant to Section
3.04, 5.06 or 14.06 not involving any transfer.
The Company shall not be required to execute or to provide for the
registration of transfer of or the exchange of (a) Securities of any series, or
any Tranche thereof, during a period of fifteen (15) days immediately preceding
the date notice is to be given identifying the serial numbers of the Securities
of such series or Tranche called for redemption or (b) any Security so selected
for redemption in whole or in part, except the unredeemed portion of any
Security being redeemed in part.
SECTION 3.06 Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same series and Tranche, 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 (a)
evidence to their satisfaction of the ownership of and the destruction, loss or
theft of any Security and (b) such security or indemnity as may be reasonably
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 Security
is held by a Person purporting to be the owner of such Security, the Company
shall execute and the Trustee shall authenticate and deliver, in lieu of any
such destroyed, lost or stolen Security, a new Security of the same series and
Tranche, and of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
Notwithstanding the foregoing, in case any such mutilated,
destroyed, lost or stolen Security has become or is about to become due and
payable, the Company in its discretion may, but subject to compliance with the
foregoing conditions, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security 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
reasonable expenses (including the fees and expenses of the Trustee) connected
therewith.
Every new Security of any series issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security shall constitute an additional
contractual obligation of the
37
Company, whether or not the destroyed, lost or stolen Security shall be at any
time enforceable by anyone other than the Holder of such new Security, and any
such new Security shall be entitled to all the benefits of this Indenture
equally and proportionately with any and all other Securities of such 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 Securities.
SECTION 3.07 Payment of Interest; Interest Rights Preserved.
Unless otherwise specified as contemplated by Section 3.01 with
respect to the Securities of any series, or any Tranche thereof, interest on any
Security 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 Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest.
Any interest on any Security 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 related 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 (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on a date
(herein called 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 Security 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 thirty (30) days
and not less than ten (10) days prior to the date of the proposed payment and
not less than twenty-five (25) 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, not less than fifteen (15) days prior to such Special Record Date, cause
notice of the proposed payment of such Defaulted Interest and the Special Record
Date therefor to be given to each Holder of Securities of such series. 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 Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on such Special
Record Date.
(b) The Company may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with the
requirements of any
38
securities exchange on which such Securities 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 and Section
3.05, each Security delivered under this Indenture upon registration of transfer
of or in exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.
SECTION 3.08 Persons Deemed Owners.
The Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name any Security is registered as the absolute
owner of such Security for the purpose of receiving payment of principal of and
premium, if any, and (subject to Sections 3.05 and 3.07) interest, if any, on
such Security and for all other purposes whatsoever, whether or not such
Security 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 3.09 Cancellation by Security Registrar.
All Securities surrendered for payment, redemption, registration of
transfer or exchange shall, if surrendered to any Person other than the Security
Registrar, be delivered to the Security Registrar and, if not theretofore
canceled, shall be promptly canceled by the Security Registrar. The Company may
at any time deliver to the Security Registrar for cancellation any Securities
previously authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever or which the Company shall not have issued and
sold, and all Securities so delivered shall be promptly canceled by the Security
Registrar. No Securities shall be authenticated in lieu of or in exchange for
any Securities canceled as provided in this Section 3.09, except as expressly
permitted by this Indenture. All canceled Securities held by the Security
Registrar shall be disposed of in accordance with the Security Registrar's then
customary practice for disposing of securities, unless otherwise directed by a
Company Order; provided, however, that the Trustee shall not be required to
destroy any canceled Securities.
SECTION 3.10 Computation of Interest.
Except as otherwise specified as contemplated by Section 3.01 for
Securities of any series, or any Tranche thereof, interest on the Securities of
each series shall be computed on the basis of a three hundred sixty (360) day
year consisting of twelve (12) thirty (30) day months and, with respect to any
period less than a full calendar month, on the basis of the actual number of
days elapsed during such period.
SECTION 3.11 Payment to Be in Proper Currency.
In the case of the Securities of any series, or any Tranche thereof,
denominated in any currency other than Dollars or in a composite currency (the
"Required Currency"), except as otherwise specified with respect to such
Securities as contemplated by Section 3.01, the obligation of the Company to
make any payment of the principal thereof, or the premium, if any,
39
or interest, if any, thereon, shall not be discharged or satisfied by any tender
by the Company, or recovery by the Trustee, in any currency other than the
Required Currency, except to the extent that such tender or recovery shall
result in the Trustee timely holding the full amount of the Required Currency
then due and payable. If any such tender or recovery is in a currency other than
the Required Currency, the Trustee may take such actions as it considers
appropriate to exchange such currency for the Required Currency. The costs and
risks of any such exchange, including without limitation the risks of delay and
exchange rate fluctuation, shall be borne by the Company, the Company shall
remain fully liable for any shortfall or delinquency in the full amount of
Required Currency then due and payable, and in no circumstances shall the
Trustee be liable therefor except in the case of its negligence or willful
misconduct.
SECTION 3.12 CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" or other
similar numbers (if then generally in use), and, if so, the Trustee or Security
Registrar may use "CUSIP" or such other 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 Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on the
Securities, in which case none of the Company or, as the case may be, the
Trustee or the Security Registrar, or any agent of any of them, shall have any
liability in respect of any CUSIP number used on any such notice, and any such
redemption shall not be affected by any defect in or omission of such numbers.
The Company will promptly notify the Trustee of any change in the "CUSIP"
numbers.
ARTICLE IV
----------
ISSUANCE OF SECURITIES
----------------------
SECTION 4.01 General.
Subject to the provisions of Section 4.02, 4.03 or 4.04, whichever
may be applicable, the Trustee shall authenticate and deliver Securities of a
series, for original issue, at one time or from time to time in accordance with
the Company Order referred to below, upon receipt by the Trustee of:
(a) the instrument or instruments establishing the form or forms and
terms of such series, as provided in Sections 2.01 and 3.01;
(b) a Company Order requesting the authentication and delivery of
such Securities and, to the extent that the terms of such Securities shall not
have been established in an indenture supplemental hereto or in a Board
Resolution, or in an Officer's Certificate pursuant to a supplemental indenture
or Board Resolution, all as contemplated by Section 3.01, either (i)
establishing such terms or (ii) in the case of Securities of a series subject to
a Periodic Offering, specifying procedures, acceptable to the Trustee, by which
such terms are to be established (which procedures may provide for
authentication and delivery pursuant to oral or electronic instructions from the
Company or any agent or agents thereof, which oral instructions
40
are to be promptly confirmed electronically or in writing), in either case in
accordance with the instrument or instruments delivered pursuant to clause (a)
above;
(c) the Securities of such series, executed on behalf of the Company
by an Authorized Officer;
(d) an Opinion of Counsel to the effect that:
(i) the form or forms of such Securities have been duly
authorized by the Company and have been established in conformity with the
provisions of this Indenture;
(ii) the terms of such Securities have been duly authorized by
the Company and have been established in conformity with the provisions of
this Indenture; and
(iii) when such Securities shall have been authenticated and
delivered by the Trustee and issued and delivered by the Company in the
manner and subject to any conditions specified in such Opinion of Counsel,
such Securities will constitute valid obligations of the Company, entitled
to the benefit of the Lien of this Indenture equally and ratably with all
other Securities then Outstanding;
provided, however, that, with respect to Securities of a series subject to a
Periodic Offering, the Trustee shall be entitled to receive such Opinion of
Counsel only once at or prior to the time of the first authentication and
delivery of such Securities (provided that such Opinion of Counsel addresses the
authentication and delivery of all such Securities) and that, in lieu of the
opinions described in clauses (ii) and (iii) above, counsel may opine that:
(x) when the terms of such Securities shall have been
established pursuant to a Company Order or Orders or pursuant to such
procedures as may be specified from time to time by a Company Order or
Orders, all as contemplated by and in accordance with the instrument or
instruments delivered pursuant to clause (a) above, such terms will have
been duly authorized by the Company and will have been established in
conformity with the provisions of this Indenture; and
(y) when such Securities shall have been authenticated and
delivered by the Trustee in accordance with this Indenture and the Company
Order or Orders or the specified procedures referred to in paragraph (x)
above and issued and delivered by the Company in the manner and subject to
any conditions specified in such Opinion of Counsel, such Securities will
constitute valid obligations of the Company, entitled to the benefit of
the Lien of this Indenture equally and ratably with all other Securities
then Outstanding;
(e) an Officer's Certificate to the effect that, to the knowledge of
the signer, no Event of Default has occurred and is continuing; provided,
however, that with respect to Securities of a series subject to a Periodic
Offering, either (i) such an Officer's Certificate shall be delivered at the
time of the authentication and delivery of each Security of such series or (ii)
the Officer's Certificate delivered at or prior to the time of the first
authentication and delivery of
41
the Securities of such series shall state that the statements therein shall be
deemed to be made at the time of each, or each subsequent, authentication and
delivery of Securities of such series; and
(f) such other Opinions of Counsel, certificates and other documents
as may be required under Section 4.02, 4.03 or 4.04, whichever may be applicable
to the authentication and delivery of the Securities of such series.
With respect to Securities of a series subject to a Periodic
Offering, the Trustee may conclusively rely, as to the authorization by the
Company of any of such Securities, the forms and terms thereof, the validity
thereof and the compliance of the authentication and delivery thereof with the
terms and conditions of this Indenture, upon the Opinion or Opinions of Counsel
and the certificates and other documents delivered pursuant to this Article IV
at or prior to the time of the first authentication and delivery of Securities
of such series until any of such opinions, certificates or other documents have
been superseded or revoked or expire by their terms. In connection with the
authentication and delivery of Securities of a series subject to a Periodic
Offering, the Trustee shall be entitled to assume that the Company's
instructions to authenticate and deliver such Securities do not violate any
applicable law or any applicable rule, regulation or order of any Governmental
Authority having jurisdiction over the Company.
Anything herein to the contrary notwithstanding, none of the
conditions specified in Sections 4.02, 4.03 and 4.04 shall be required to be
satisfied in connection with the initial authentication and delivery of the
Securities of the Initial Series.
SECTION 4.02 Issuance of Securities on the Basis of Property Additions.
(a) Securities of any one or more series may be authenticated and
delivered on the basis of Property Additions which do not constitute Funded
Property in a principal amount not exceeding seventy percentum (70%) of the
balance of the Cost or the Fair Value to the Company of such Property Additions
(whichever shall be less) after making any deductions and any additions pursuant
to Section 1.03(b), except as otherwise specified in subsection (b) with respect
to the Initial Expert's Certificate.
(b) Securities of any series shall be authenticated and delivered by
the Trustee on the basis of Property Additions upon receipt by the Trustee of:
(i) the documents with respect to the Securities of such
series specified in Section 4.01;
(ii) an Expert's Certificate dated as of a date not more than
ninety (90) days prior to the date of the Company Order requesting the
authentication and delivery of such Securities,
(A) describing all property constituting Property
Additions and designated by the Company, in its discretion, to be
made the basis of the authentication and delivery of such Securities
(such description of property to be made by reference, at the
election of the Company, either to specified items, units and/or
elements of property or portions thereof, on a percentage or Dollar
basis, or to properties reflected in specified accounts or
subaccounts in the Company's
42
books of account or portions thereof, on a Dollar basis), and
stating the Cost of such property;
(B) stating that all such property constitutes Property
Additions;
(C) stating that such Property Additions are desirable
for use in the conduct of the business, or one of the businesses, of
the Company;
(D) stating that such Property Additions, to the extent
of the Cost or Fair Value to the Company thereof (whichever is less)
to be made the basis of the authentication and delivery of such
Securities, do not constitute Funded Property;
(E) stating, except as to Property Additions acquired,
made or constructed wholly through the delivery of securities or
other property, that the amount of cash forming all or part of the
Cost thereof was equal to or more than an amount to be stated
therein;
(F) briefly describing, with respect to any Property
Additions acquired, made or constructed in whole or in part through
the delivery of securities or other property, the securities or
other property so delivered and stating the date of such delivery;
(G) stating what part, if any, of such Property
Additions includes property which within six months prior to the
date of acquisition thereof by the Company had been used or operated
by others than the Company in a business similar to that in which it
has been or is to be used or operated by the Company and stating
whether or not, in the judgment of the signers, the Fair Value
thereof to the Company, as of the date of such certificate, is less
than Twenty-five Thousand Dollars ($25,000) and whether or not such
Fair Value is less than one percentum (1%) of the aggregate
principal amount of Securities then Outstanding;
(H) stating, in the judgment of the signers, the Fair
Value to the Company, as of the date of such certificate, of such
Property Additions, except any thereof with respect to the Fair
Value to the Company of which a statement is to be made in an
Independent Expert's Certificate pursuant to clause (iii) below;
(I) stating the amount required to be deducted under
Section 1.03(b)(i) and the amounts elected to be added under Section
1.03(b)(ii) in respect of Funded Property retired of the Company;
(J) if any property included in such Property Additions
is subject to a Lien (other than the lien of the SPPC 1940 Mortgage)
of the character described (I) in clause (d) of the definition of
Permitted Liens, stating that such Lien does not, in the judgment of
the signers, materially impair the use by the Company of the
Mortgaged Property considered as a whole, or (II) in clause
43
(g)(ii) of the definition of Permitted Liens, stating that such
Lien does not, in the judgment of the signers, materially impair the
use by the Company of such property for the purposes for which it is
held by the Company or (III) in clause (n)(ii) of the definition of
Permitted Liens, stating that the enforcement of such Lien would
not, in the judgment of the signers, adversely affect the interests
of the Company in such property in any material respect;
(K) stating the lower of the Cost or the Fair Value to
the Company of such Property Additions, after the deductions
therefrom and additions thereto specified in such Expert's
Certificate pursuant to clause (I) above;
(L) stating the amount equal to seventy percentum (70%)
of the amount required to be stated pursuant to clause (K) above;
and
(M) stating the aggregate principal amount of the
Securities to be authenticated and delivered on the basis of such
Property Additions (such amount not to exceed the amount stated
pursuant to clause (L) above); provided, however, that in the
Initial Expert's Certificate there shall be stated, in lieu of such
principal amount, the sum of (I) the principal amount of Securities
to be authenticated and delivered on the basis of Property
Additions, (II) the aggregate principal amount of all Securities
then Outstanding and (III) the aggregate principal amount of all
First Mortgage Bonds then Outstanding (such sum not to exceed the
amount stated pursuant to clause (L) above);
(iii) in case any Property Additions are shown by the Expert's
Certificate provided for in clause (ii) above to include property which,
within six months prior to the date of acquisition thereof by the Company,
had been used or operated by others than the Company in a business similar
to that in which it has been or is to be used or operated by the Company
and such certificate does not show the Fair Value thereof to the Company,
as of the date of such certificate, to be less than Twenty-five Thousand
Dollars ($25,000) or less than one percentum (1%) of the aggregate
principal amount of Securities then Outstanding, an Independent Expert's
Certificate stating, in the judgment of the signer, the Fair Value to the
Company, as of the date of such Independent Expert's Certificate, of (X)
such Property Additions which have been so used or operated and (at the
option of the Company) as to any other Property Additions included in the
Expert's Certificate provided for in clause (ii) above and (Y) in case
such Independent Expert's Certificate is being delivered in connection
with the authentication and delivery of Securities, any property so used
or operated which has been subjected to the Lien of this Indenture since
the commencement of the then current calendar year as the basis for the
authentication and delivery of Securities and as to which an Independent
Expert's Certificate has not previously been furnished to the Trustee;
(iv) in case any Property Additions are shown by the Expert's
Certificate provided for in clause (ii) above to have been acquired, made
or constructed in whole or in part through the delivery of securities or
other property, an Expert's Certificate stating, in the judgment of the
signers, the fair market value in cash of such
44
securities or other property at the time of delivery thereof in payment
for or for the acquisition of such Property Additions;
(v) an Opinion of Counsel to the effect that:
(A) this Indenture constitutes, or, upon the delivery
of, and/or the filing and/or recording in the proper places and
manner of, the instruments of conveyance, assignment or transfer, if
any, specified in said opinion, will constitute, a Lien on all the
Property Additions to be made the basis of the authentication and
delivery of such Securities, subject to no Lien thereon prior to the
Lien of this Indenture except Permitted Liens; and
(B) the Company has corporate authority to operate such
Property Additions; and
(vi) copies of the instruments of conveyance, assignment and
transfer, if any, specified in the Opinion of Counsel provided for in
clause (v) above.
SECTION 4.03 Issuance of Securities on the Basis of Retired Securities.
(a) Subject to the provisions of subsection (c) of this Section,
Securities of any one or more series may be authenticated and delivered on the
basis of, and in an aggregate principal amount not exceeding the aggregate
principal amount of, Retired Securities.
(b) Securities of any series shall be authenticated and delivered by
the Trustee on the basis of Retired Securities upon receipt by the Trustee of:
(i) the documents with respect to the Securities of such
series specified in Section 4.01; and
(ii) an Officer's Certificate stating that Retired Securities,
specified by series, in an aggregate principal amount not less than the
aggregate principal amount of Securities to be authenticated and
delivered, have theretofore been authenticated and delivered and, as of
the date of such Officer's Certificate, constitute Retired Securities and
are the basis for the authentication and delivery of such Securities.
SECTION 4.04 Issuance of Securities on the Basis of Deposit of Cash.
(a) Securities of any one or more series may be authenticated and
delivered on the basis of, and in an aggregate principal not exceeding the
amount of, any deposit with the Trustee of cash for such purpose.
(b) Securities of any series shall be authenticated and delivered by
the Trustee on the basis of the deposit of cash when the Trustee shall have
received, in addition to such deposit, the documents with respect to the
Securities of such series specified in Section 4.01.
(c) All cash deposited with the Trustee under the provisions of this
Section shall be held by the Trustee as a part of the Mortgaged Property and may
be withdrawn from
45
time to time by the Company, upon application of the Company to the Trustee, in
an amount equal to the aggregate principal amount of Securities to the
authentication and delivery of which the Company shall be entitled under any of
the provisions of this Indenture by virtue of compliance with all applicable
provisions of this Indenture (except as hereinafter in this subsection (c)
otherwise provided).
Upon any such application for withdrawal, the Company shall comply
with all applicable provisions of this Indenture relating to the authentication
and delivery of Securities except that the Company shall not in any event be
required to deliver the documents specified in Section 4.01.
Any withdrawal of cash under this subsection (c) shall operate as a
waiver by the Company of its right to the authentication and delivery of the
Securities on which it is based and such Securities may not thereafter be
authenticated and delivered hereunder. Any Property Additions which have been
made the basis of any such right to the authentication and delivery of
Securities so waived shall be deemed to have been made the basis of the
withdrawal of such cash; and any Retired Securities which have been made the
basis of any such right to the authentication and delivery of Securities so
waived shall be deemed to have been made the basis of the withdrawal of such
cash.
(d) If at any time the Company shall so direct, any sums deposited
with the Trustee under the provisions of this Section may be used or applied to
the purchase, payment or redemption of Securities in the manner and subject to
the conditions provided in clauses (d) and (e) of Section 8.06.
ARTICLE V
---------
REDEMPTION OF SECURITIES
------------------------
SECTION 5.01 Applicability of Article.
Securities of any series, or any Tranche thereof, which are
redeemable before their Stated Maturity shall be redeemable in accordance with
their terms and (except as otherwise specified as contemplated by Section 3.01
for Securities of such series or Tranche) in accordance with this Article.
SECTION 5.02 Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution or an Officer's Certificate. The Company shall,
at least forty-five (45) days prior to the Redemption Date fixed by the Company
(unless a shorter notice shall be satisfactory to the Trustee), notify the
Trustee in writing of such Redemption Date and of the principal amount of such
Securities to be redeemed. In the case of any redemption of Securities (a) prior
to the expiration of any restriction on such redemption provided in the terms of
such Securities 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
Securities, the Company shall furnish the Trustee with an Officer's Certificate
evidencing compliance with such restriction or condition.
46
SECTION 5.03 Selection of Securities to Be Redeemed.
If less than all the Securities of any series, or any Tranche
thereof, are to be redeemed, the particular Securities to be redeemed shall be
selected by the Security Registrar from the Outstanding Securities of such
series or Tranche not previously called for redemption, by such method as shall
be provided for any particular series or Tranche, or, in the absence of any such
provision, by such method of random selection as the Security Registrar shall
deem fair and appropriate and which may, in any case, provide for the selection
for redemption of portions (equal to the minimum authorized denomination for
Securities of such series or Tranche or any integral multiple thereof) of the
principal amount of Securities of such series or Tranche having a denomination
larger than the minimum authorized denomination for Securities of such series or
Tranche; provided, however, that if, as indicated in an Officer's Certificate,
the Company shall have offered to purchase all or any principal amount of the
Securities then Outstanding of any series, or any Tranche thereof, and less than
all of such Securities as to which such offer was made shall have been tendered
to the Company for such purchase, the Security Registrar, if so directed by
Company Order, shall select for redemption all or any principal amount of such
Securities which have not been so tendered.
The Security Registrar shall promptly notify the Company and the
Trustee in writing of the Securities selected for redemption and, in the case of
any Securities selected to be redeemed in part, the principal amount thereof to
be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
SECTION 5.04 Notice of Redemption.
Notice of redemption shall be given in the manner provided in
Section 1.08 to the Holders of the Securities to be redeemed not less than
thirty (30) nor more than sixty (60) days prior to the Redemption Date.
All notices of redemption shall state:
(a) the Redemption Date,
(b) the Redemption Price,
(c) if less than all the Securities of any series or Tranche are to
be redeemed, the identification of the particular Securities to be redeemed and
the portion of the principal amount of any Security to be redeemed in part,
(d) that on the Redemption Date the Redemption Price, together with
accrued interest, if any, to the Redemption Date, will become due and payable
upon each such Security to be redeemed and, if applicable, that interest thereon
will cease to accrue on and after said date,
47
(e) the place or places where such Securities are to be surrendered
for payment of the Redemption Price and accrued interest, if any, unless it
shall have been specified as contemplated by Section 3.01 with respect to such
Securities that such surrender shall not be required,
(f) that the redemption is for a sinking or other fund, if such is
the case, and
(g) such other matters as the Company shall deem desirable or
appropriate.
With respect to any notice of redemption of Securities at the
election of the Company, unless, upon the giving of such notice, such Securities
shall be deemed to have been paid in accordance with Section 9.01, such notice
may state that such redemption shall be conditional upon the receipt by the
Paying Agent or Agents for such Securities, on or prior to the date fixed for
such redemption, of money sufficient to pay the principal of and premium, if
any, and interest, if any, on such Securities and that if such money shall not
have been so received such notice shall be of no force or effect and the Company
shall not be required to redeem such Securities. In the event that such notice
of redemption contains such a condition and such money is not so received, the
redemption shall not be made and within a reasonable time thereafter notice
shall be given, in the manner in which the notice of redemption was given, that
such money was not so received and such redemption was not required to be made,
and the Paying Agent or Agents for the Securities otherwise to have been
redeemed shall promptly return to the Holders thereof any of such Securities
which had been surrendered for payment upon such redemption.
Notice of redemption of Securities to be redeemed at the election of
the Company, and any notice of non-satisfaction of a condition for redemption as
aforesaid, shall be given by the Company or, at the Company's request, by the
Security Registrar in the name and at the expense of the Company. Notice of
mandatory redemption of Securities shall be given by the Security Registrar in
the name and at the expense of the Company.
SECTION 5.05 Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, and the
conditions, if any, set forth in such notice having been satisfied, the
Securities or portions thereof 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, in the case of an unconditional notice of redemption,
the Company shall default in the payment of the Redemption Price and accrued
interest, if any) such Securities or portions thereof, if interest-bearing,
shall cease to bear interest. Upon surrender of any such Security for redemption
in accordance with such notice, such Security or portion thereof shall be paid
by the Company at the Redemption Price, together with accrued interest, if any,
to the Redemption Date; provided, however, that no such surrender shall be a
condition to such payment if so specified as contemplated by Section 3.01 with
respect to such Security; and provided, further, that, except as otherwise
specified as contemplated by Section 3.01 with respect to such Security, any
installment of interest on any Security the Stated Maturity of which installment
is on or prior to the Redemption Date shall be payable to the Holder of such
Security, or one or more Predecessor Securities, registered as such at the close
of
48
business on the related Regular Record Date according to the terms of such
Security and subject to the provisions of Section 3.07.
SECTION 5.06 Securities Redeemed in Part.
Upon the surrender of any Security which is to be redeemed only in
part 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), the Company shall execute, and the
Trustee shall authenticate and deliver to the Holder of such Security, without
service charge, a new Security or Securities of the same series and Tranche, of
any authorized denomination requested by such Holder and of like tenor and in
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered.
ARTICLE VI
----------
COVENANTS
---------
SECTION 6.01 Payment of Securities; Lawful Possession; Maintenance of Lien.
(a) The Company shall pay the principal of and premium, if any, and
interest, if any, on the Securities of each series in accordance with the terms
of such Securities and this Indenture.
(b) At the date of the execution and delivery of this Indenture, as
originally executed and delivered, the Company is lawfully possessed of the
Mortgaged Property.
(c) The Company shall maintain and preserve the Lien of this
Indenture so long as any Securities shall remain Outstanding, subject, however,
to the provisions of Article VIII and Article XIV.
SECTION 6.02 Maintenance of Office or Agency.
The Company shall maintain in each Place of Payment for the
Securities of each series, or any Tranche thereof, an office or agency where
payment of such Securities shall be made, where the registration of transfer or
exchange of such Securities may be effected and where notices and demands to or
upon the Company in respect of such Securities and this Indenture may be served.
The Company shall give prompt written notice to the Trustee of the location, and
any change in the location, of each such office or agency and prompt notice to
the Holders of any such change in the manner specified in Section 1.08. If at
any time the Company shall fail to maintain any such required office or agency
in respect of Securities of any series, or any Tranche thereof, or shall fail to
furnish the Trustee with the address thereof, payment of such Securities shall
be made, registration of transfer or exchange thereof may be effected and
notices and demands in respect thereof may be served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee as its agent
for all such purposes in any such event.
49
The Company may also from time to time designate one or more other
offices or agencies with respect to the Securities of one or more series, or any
Tranche thereof, for any or all of the foregoing purposes and may from time to
time rescind such designations; provided, however, that, unless otherwise
specified as contemplated by Section 3.01 with respect to the Securities of such
series or Tranche, no such designation or rescission shall in any manner relieve
the Company of its obligation to maintain an office or agency for such purposes
in each Place of Payment for such Securities in accordance with the requirements
set forth above. The Company shall give prompt written notice to the Trustee,
and prompt notice to the Holders in the manner specified in Section 1.08, of any
such designation or rescission and of any change in the location of any such
other office or agency.
Anything herein to the contrary notwithstanding, any office or
agency required by this Section may be maintained at an office of the Company,
in which event the Company shall perform all functions to be performed at such
office or agency.
SECTION 6.03 Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with
respect to the Securities of any series, or any Tranche thereof, it shall, on or
before each due date of the principal of and premium, if any, and interest, if
any, on any of such Securities, segregate and hold in trust for the benefit of
the Persons entitled thereto a sum sufficient to pay the principal and premium
or interest so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided. The Company shall promptly notify the
Trustee of any failure by the Company (or any other obligor on such Securities)
to make any payment of principal of or premium, if any, or interest, if any, on
such Securities.
Whenever the Company shall have one or more Paying Agents for the
Securities of any series, or any Tranche thereof, it shall, on or before each
due date of the principal of and premium, if any, and interest, if any, on such
Securities, deposit with such Paying Agents sums sufficient (without
duplication) to pay the principal and premium or interest so becoming due, such
sums to be held in trust for the benefit of the Persons entitled to such
principal, premium or interest, and (unless such Paying Agent is the Trustee)
the Company shall promptly notify the Trustee of any failure by it so to act.
The Company shall cause each Paying Agent for the Securities of any
series, or any Tranche thereof, other than the Company or 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 shall:
(a) hold all sums held by it for the payment of the principal of and
premium, if any, or interest, if any, on such Securities in trust for the
benefit of the Persons entitled thereto until such sums shall be paid to such
Persons or otherwise disposed of as herein provided;
(b) give the Trustee notice of any failure by the Company (or any
other obligor upon such Securities) to make any payment of principal of or
premium, if any, or interest, if any, on such Securities; and
50
(c) at any time during the continuance of any such failure, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held in
trust by such Paying Agent and furnish to the Trustee such information as it
possesses regarding the names and addresses of the Persons entitled to such
sums.
The Company may at any time 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, if
so stated in a Company Order delivered to the Trustee, in accordance with the
provisions of Article IX; 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 and premium,
if any, or interest, if any, on any Security and remaining unclaimed for two
years after such principal and premium, if any, or interest, if any, 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, upon such payment
or discharge, the Holder of such Security shall, as an unsecured general
creditor and not as the Holder of an Outstanding Security, look only to the
Company for payment of the amount so due and payable and remaining unpaid, 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 payment to the Company, shall, upon receipt of a
Company Request and at the expense of the Company, cause to be mailed, on one
occasion only, notice to such Holder that such money remains unclaimed and that,
after a date specified therein, which shall not be less than thirty (30) days
from the date of such mailing, any unclaimed balance of such money then
remaining will be paid to the Company.
SECTION 6.04 Corporate Existence.
Subject to the rights of the Company under Article XIII, the Company
shall do or cause to be done all things necessary to preserve and keep its
corporate existence in full force and effect.
SECTION 6.05 Maintenance of Properties.
The Company shall cause (or, with respect to property owned in
common with others, make reasonable effort to cause) the Mortgaged Property,
considered as a whole, to be maintained and kept in good condition, repair and
working order and shall cause (or, with respect to property owned in common with
others, make reasonable effort to cause) to be made such repairs, renewals,
replacements, betterments and improvements thereof, as, in the judgment of the
Company, may be necessary in order that the operation of the Mortgaged Property,
considered as a whole, may be conducted in accordance with common industry
practice; provided, however, that nothing in this Section shall prevent the
Company from discontinuing, or causing the discontinuance of, the operation and
maintenance of any portion of the Mortgaged Property; and provided, further,
that nothing in this Section shall prevent the Company from
51
selling, transferring or otherwise disposing of, or causing the sale, transfer
or other disposition of, any portion of the Mortgaged Property.
SECTION 6.06 Payment of Taxes; Discharge of Liens.
The Company shall pay all taxes and assessments and other
governmental charges lawfully levied or assessed upon the Mortgaged Property, or
upon any part thereof, or upon the interest of the Trustee in the Mortgaged
Property, before the same shall become delinquent, and shall make reasonable
effort to observe and conform in all material respects to all valid requirements
of any Governmental Authority relative to any of the Mortgaged Property and all
covenants, terms and conditions upon or under which any of the Mortgaged
Property is held; and the Company shall not suffer any Lien to be created upon
the Mortgaged Property, or any part thereof, prior to the Lien hereof, other
than Permitted Liens and other than, in the case of property hereafter acquired,
Purchase Money Liens and any other Liens existing or placed thereon at the time
of the acquisition thereof; provided, however, that nothing in this Section
contained shall require the Company (i) to observe or conform to any requirement
of Governmental Authority or to cause to be paid or discharged, or to make
provision for, any such Lien, or to pay any such tax, assessment or governmental
charge so long as the validity thereof shall be contested in good faith and by
appropriate legal proceedings, (ii) to pay, discharge or make provisions for any
tax, assessment or other governmental charge, the validity of which shall not be
so contested if adequate security for the payment of such tax, assessment or
other governmental charge and for any penalties or interest which may reasonably
be anticipated from failure to pay the same shall be given to the Trustee or
(iii) to pay, discharge or make provisions for any Liens existing on the
Mortgaged Property at the date of execution and delivery of this Indenture, as
originally executed and delivered; and provided, further, that nothing in this
Section shall prohibit the issuance or other incurrence of additional
indebtedness, or the refunding of outstanding indebtedness, secured by any Lien
prior to the Lien hereof which is permitted under this Section to continue to
exist.
SECTION 6.07 Insurance.
(a) The Company shall (i) keep or cause to be kept all the property
subject to the Lien of this Indenture insured against loss by fire, to the
extent that property of similar character is usually so insured by companies
similarly situated and operating like properties, to a reasonable amount, by
reputable insurance companies, the proceeds of such insurance (except as to any
loss of Excepted Property and except as to any particular loss less than the
greater of (A) Ten Million Dollars ($10,000,000) and (B) three percentum (3%) of
the sum of (1) the principal amount of Securities Outstanding on the date of
such particular loss and (2) the principal amount of the First Mortgage Bonds
Outstanding on the date of such particular loss) to be made payable, subject to
applicable law, to the Trustee as the interest of the Trustee may appear, to the
trustee of the SPPC 1940 Mortgage, or to the trustee or other holder of any
other Lien prior hereto upon property subject to the Lien hereof, if the terms
thereof require such payment or (ii) in lieu of or supplementing such insurance
in whole or in part, adopt some other method or plan of protection against loss
by fire at least equal in protection to the method or plan of protection against
loss by fire of companies similarly situated and operating properties subject to
similar fire hazards or properties on which an equal primary fire insurance rate
has been set by reputable insurance companies; and if the Company shall adopt
such other method or plan of
52
protection, it shall, subject to applicable law (and except as to any loss of
Excepted Property and except as to any particular loss less than the greater of
(X) Ten Million Dollars ($10,000,000) and (Y) three percentum (3%) of the sum of
(1) the principal amount of Securities Outstanding on the date of such
particular loss and (2) the principal amount of the First Mortgage Bonds
Outstanding on the date of such particular loss) pay to the Trustee on account
of any loss covered by such method or plan an amount in cash equal to the amount
of such loss less any amounts otherwise paid to the Trustee in respect of such
loss or paid to the trustee under the SPPC 1940 Mortgage or to the trustee or
other holder of any other Lien prior hereto upon property subject to the Lien
hereof in respect of such loss if the terms thereof require such payment. Any
cash so required to be paid by the Company pursuant to any such method or plan
shall for the purposes of this Indenture be deemed to be proceeds of insurance.
In case of the adoption of such other method or plan of protection, the Company
shall also furnish to the Trustee a certificate of an actuary or other qualified
person appointed by the Company with respect to the adequacy of such method or
plan.
Anything herein to the contrary notwithstanding, the Company may
have fire insurance policies with (i) a deductible provision in a dollar amount
per occurrence not exceeding the greater of (A) Ten Million Dollars
($10,000,000) and (B) three percentum (3%) of the sum of (1) the principal
amount of the Securities Outstanding on the date such policy goes into effect
and (2) the principal amount of the First Mortgage Bonds Outstanding on the date
such policy goes into effect, and/or (ii) co-insurance or self insurance
provisions with a dollar amount per occurrence not exceeding thirty percentum
(30%) of the loss proceeds otherwise payable; provided, however, that the dollar
amount described in clause (i) above may be exceeded to the extent such dollar
amount per occurrence is below the deductible amount in effect as to fire
insurance (X) on property of similar character insured by companies similarly
situated and operating like property or (Y) on property as to which an equal
primary fire insurance rate has been set by reputable insurance companies.
(b) All moneys paid to the Trustee by the Company in accordance
with this Section or received by the Trustee as proceeds of any insurance, in
either case on account of a loss on or with respect to Funded Property, shall,
subject to the requirements of the SPPC 1940 Mortgage or other Lien prior hereto
upon property subject to the Lien hereof, be held by the Trustee and, subject as
aforesaid, shall be paid by it to the Company to reimburse the Company for an
equal amount expended or committed for expenditure in the rebuilding, renewal
and/or replacement of or substitution for the property destroyed or damaged or
lost, upon receipt by the Trustee of:
(i) a Company Request requesting such payment,
(ii) an Expert's Certificate:
(A) describing the property so damaged or destroyed or
otherwise lost;
(B) stating the Cost of such property (or, if the Fair
Value to the Company of such property at the time the same became
Funded Property was certified to be an amount less than the Cost
thereof, then such Fair Value, as so
53
certified, in lieu of Cost) or, if such damage or destruction shall
have affected only a portion of such property, stating the allocable
portion of such Cost or Fair Value;
(C) stating the amounts so expended or committed for
expenditure in the rebuilding, renewal, replacement of and/or
substitution for such property; and
(D) stating the Fair Value to the Company of such
property as rebuilt or renewed or as to be rebuilt or renewed and/or
of the replacement or substituted property, and if
(I) within six months prior to the date of
acquisition thereof by the Company, such property has
been used or operated, by a person or persons other than
the Company, in a business similar to that in which it
has been or is to be used or operated by the Company,
and
(II) the Fair Value to the Company of such
property as set forth in such Expert's Certificate is
not less than Twenty-five Thousand Dollars ($25,000) and
not less than one percentum (1%) of the aggregate
principal amount of the Securities at the time
Outstanding,
the Expert making the statement required by this clause (D) shall
be an Independent Expert, and
(iii) an Opinion of Counsel stating that, in the opinion of
the signer, the property so rebuilt or renewed or to be rebuilt or
renewed, and/or the replacement property, is or will be subject to the
Lien hereof to the same extent as was the property so destroyed or damaged
or otherwise lost.
Any such moneys not so applied within thirty-six (36) months after
its receipt by the Trustee, or in respect of which notice in writing of
intention to apply the same to the work of rebuilding, renewal, replacement or
substitution then in progress and uncompleted shall not have been given to the
Trustee by the Company within such thirty-six (36) months, or which the Company
shall at any time notify the Trustee is not to be so applied, shall thereafter
be withdrawn, used or applied in the manner, to the extent and for the purposes,
and subject to the conditions, provided in Section 8.06; provided, however, that
if the amount of such moneys shall exceed seventy percentum (70%) of the amount
stated pursuant to clause (B) in the Expert's Certificate referred to above, the
amount of such excess shall not be deemed to be Funded Cash, shall not be
subject to Section 8.06 and shall be remitted to or upon the order of the
Company upon the withdrawal, use or application of the balance of such moneys
pursuant to Section 8.06.
Anything in this Indenture to the contrary notwithstanding, if
property on or with respect to which a loss occurs constitutes Funded Property
in part only, the Company may, at its election, obtain the reimbursement of
insurance proceeds attributable to the part of such property which constitutes
Funded Property under this subsection (b) and obtain the reimbursement of
54
insurance proceeds attributable to the part of such property which does not
constitute Funded Property under subsection (c) of this Section 6.07.
(c) All moneys paid to the Trustee by the Company in accordance
with this Section or received by the Trustee as proceeds of any insurance, in
either case on account of a loss on or with respect to property which does not
constitute Funded Property, shall, subject to the requirements of the SPPC 1940
Mortgage or other Lien prior hereto upon property subject to the Lien hereof, be
held by the Trustee and, subject as aforesaid, shall be paid by it to the
Company upon receipt by the Trustee of:
(i) a Company Request requesting such payment;
(ii) an Expert's Certificate stating:
(A) that such moneys were paid to or received by the
Trustee on account of a loss on or with respect to property which
does not constitute Funded Property; and
(B) if true, either (I) that the aggregate amount of
the Cost or Fair Value to the Company (whichever is less) of all
Property Additions which do not constitute Funded Property
(excluding, to the extent of such loss, the property on or with
respect to which such loss was incurred), after making deductions
therefrom and additions thereto of the character contemplated by
Section 1.03, is not less than zero (0) or (II) that the amount of
such loss does not exceed the aggregate Cost or Fair Value to the
Company (whichever is less) of Property Additions acquired, made or
constructed on or after the ninetieth (90th) day prior to the date
of the Company Request requesting such payment; or
(C) if neither of the statements contemplated in
subclause (B) above can be made, the amount by which zero (0)
exceeds the amount referred to in subclause (B)(I) above (showing in
reasonable detail the calculation thereof); and
(iii) if the Expert's Certificate required by clause (ii)
above contains neither of the statements contemplated in clause (ii)(B)
above, an amount in cash, to be held by the Trustee as part of the
Mortgaged Property, equal to seventy percentum (70%) of the amount shown
in clause (ii)(C) above.
To the extent that the Company shall be entitled to withdraw
proceeds of insurance pursuant to this subsection (c), such proceeds shall be
deemed not to constitute Funded Cash.
(d) Whenever under the provisions of this Section the Company is
required to deliver moneys to the Trustee and at the same time shall have
satisfied the conditions set forth herein for payment of moneys by the Trustee
to the Company, there shall be paid to or retained by the Trustee or paid to the
Company, as the case may be, only the net amount.
55
SECTION 6.08 Recording, Filing, etc.
The Company shall cause this Indenture and all indentures and
instruments supplemental hereto (or notices, memoranda or financing statements
as may be recorded or filed to place third parties on notice thereof) to be
promptly recorded and filed and re-recorded and re-filed in such manner and in
such places, as may be required by law in order fully to preserve and protect
the security of the Holders of the Securities and all rights of the Trustee, and
shall furnish to the Trustee:
(a) promptly after the execution and delivery of this Indenture, as
originally executed and delivered, and of each supplemental indenture, an
Opinion of Counsel either stating that in the opinion of such counsel this
Indenture or such supplemental indenture (or any other instrument, notice,
memorandum or financing statement in connection therewith) has been properly
recorded and filed, so as to make effective the Lien intended to be created
hereby or thereby, and reciting the details of such action, or stating that in
the opinion of such counsel no such action is necessary to make such Lien
effective. The Company shall be deemed to be in compliance with this subsection
(a) if (i) the Opinion of Counsel herein required to be delivered to the Trustee
shall state that this Indenture or such supplemental indenture (or any other
instrument, notice, memorandum or financing statement in connection therewith)
has been received for record or filing in each jurisdiction in which it is
required to be recorded or filed and that, in the opinion of such counsel (if
such is the case), such receipt for record or filing makes effective the Lien
intended to be created by this Indenture or such supplemental indenture, and
(ii) such opinion is delivered to the Trustee within such time, following the
date of the execution and delivery of this Indenture, as originally executed and
delivered, or such supplemental indenture, as shall be practicable having due
regard to the number and distance of the jurisdictions in which this Indenture
or such supplemental indenture (or such other instrument, notice, memorandum or
financing statement in connection therewith) is required to be recorded or
filed; and
(b) on or before June 1 of each year, beginning June 1, 2002, an
Opinion of Counsel stating either (i) 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 subsection (b) or the first Opinion of Counsel
furnished pursuant to subsection (a) of this Section, with respect to the
recording, filing, re-recording, and re-filing of this Indenture and of each
indenture supplemental to this Indenture (or any other instrument, notice,
memorandum or financing statement in connection therewith), as is necessary to
maintain the effectiveness of the Lien hereof, and reciting the details of such
action, or (ii) that in the opinion of such counsel no such action is necessary
to maintain the effectiveness of such Lien.
The Company shall execute and deliver such supplemental indenture or
indentures and such further instruments and do such further acts as may be
necessary or proper to carry out the purposes of this Indenture and to make
subject to the Lien hereof any property hereafter acquired, made or constructed
and intended to be subject to the Lien hereof, and to transfer to any new
trustee or trustees or co-trustee or co-trustees, the estate, powers,
instruments or funds held in trust hereunder.
56
SECTION 6.09 Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any
term, provision or condition set forth in
(a) any covenant or restriction specified with respect to the
Securities of any one or more series, or any one or more Tranches thereof, as
contemplated by Section 3.01 if before the time for such compliance the Holders
of at least a majority in aggregate principal amount of the Outstanding
Securities of all series and Tranches with respect to which compliance with such
covenant or restriction is to be omitted, considered as one class, shall, by Act
of such Holders, either waive such compliance in such instance or generally
waive compliance with such term, provision or condition; provided, however, that
no such waiver shall be effective as to any of the matters contemplated in
clause (a), (b), (c) or (d) in Section 14.02 without the consent of the Holders
specified in such Section; and
(b) Section 6.04, 6.05, 6.06 or 6.07 or Article XIII if before the
time for such compliance the Holders of at least a majority in principal amount
of Securities Outstanding under this Indenture shall, by Act of such Holders,
either waive such compliance in such instance or generally waive compliance with
such term, provision or condition;
but, in either case, 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 6.10 Annual Officer's Certificate as to Compliance.
Not later than June 1 in each year, commencing June 1, 2002, the
Company shall deliver to the Trustee an Officer's Certificate which need not
comply with Section 1.04, executed by the principal executive officer, the
principal financial officer or the principal accounting officer of the Company,
as to such officer's knowledge of the Company's compliance with all conditions
and covenants under this Indenture, such compliance to be determined without
regard to any period of grace or requirement of notice under this Indenture.
ARTICLE VII
-----------
COVENANTS RELATING TO THE SPPC 1940 MORTGAGE
--------------------------------------------
SECTION 7.01 Prompt Payment of First Mortgage Bonds.
The Company will pay or cause to be paid, as the same shall become
due and payable, the principal of, premium, if any, and interest on all First
Mortgage Bonds issued under the SPPC 1940 Mortgage, and will not extend the time
of payment of any of such principal, premium or interest. The Company will
comply with all the terms, covenants and conditions to be performed by the
Company under the SPPC 1940 Mortgage.
57
SECTION 7.02 Closing and Discharge of SPPC 1940 Mortgage.
(a) The Company covenants and agrees that, from and after the date
of the initial authentication and delivery of the Securities of the Initial
Series issued under this Indenture, the Company will not issue any additional
First Mortgage Bonds under the SPPC 1940 Mortgage, except to the extent
necessary to replace any mutilated, lost or destroyed bonds or to effect
exchanges and transfers of bonds.
(b) As soon as practicable after the Company shall be entitled to
the release and discharge of record of the SPPC 1940 Mortgage, it shall take all
necessary action to obtain and effect the release and discharge of the lien of
the SPPC 1940 Mortgage upon any of the Mortgaged Property and the discharge and
satisfaction of the SPPC 1940 Mortgage.
ARTICLE VIII
------------
POSSESSION, USE AND RELEASE OF MORTGAGED PROPERTY
-------------------------------------------------
SECTION 8.01 Quiet Enjoyment.
Unless one or more Events of Default shall have occurred and be
continuing, the Company shall be permitted to possess, use and enjoy the
Mortgaged Property (except, to the extent not herein otherwise provided, such
cash and securities as are expressly required to be deposited with the Trustee).
SECTION 8.02 Dispositions without Release.
Unless an Event of Default shall have occurred and be continuing,
the Company may at any time and from time to time, without any release or
consent by, or report to, the Trustee:
(a) sell or otherwise dispose of, free from the Lien of this
Indenture, any machinery, equipment, apparatus, towers, transformers, poles,
lines, cables, conduits, ducts, conductors, meters, regulators, holders, tanks,
retorts, purifiers, odorizers, scrubbers, compressors, valves, pumps, mains,
pipes, service pipes, fittings, connections, services, tools, implements, or any
other fixtures or personalty, then subject to the Lien hereof, which shall have
become old, inadequate, obsolete, worn out, unfit, unadapted, unserviceable,
undesirable or unnecessary for use in the operations of the Company upon
replacing the same by, or substituting for the same, similar or analogous
property, or other property performing a similar or analogous function or
otherwise obviating the need therefor, having a Fair Value to the Company at
least equal to that of the property sold or otherwise disposed of and subject to
the Lien hereof, subject to no Liens prior hereto except Permitted Liens and any
other Liens to which the property sold or otherwise disposed of was subject;
(b) cancel or make changes or alterations in or substitutions for
any and all easements, servitudes, rights-of-way and similar rights and/or
interests; and
58
(c) grant, free from the Lien of this Indenture, easements, ground
leases or rights-of-way in, upon, over and/or across the property or
rights-of-way of the Company for the purpose of roads, pipe lines, transmission
lines, distribution lines, communication lines, railways, removal of coal or
other minerals or timber, and other like purposes, or for the joint or common
use of real property, rights-of-way, facilities and/or equipment; provided,
however, that such grant shall not materially impair the use of the property or
rights-of-way for the purposes for which such property or rights-of-way are held
by the Company.
SECTION 8.03 Release of Funded Property.
Unless an Event of Default shall have occurred and be continuing,
the Company may obtain the release of any part of the Mortgaged Property, or any
interest therein, which constitutes Funded Property, and the Trustee shall
release all its right, title and interest in and to the same from the Lien
hereof, upon receipt by the Trustee of:
(a) a Company Order requesting the release of such property and
transmitting therewith a form of instrument to effect such release;
(b) an Officer's Certificate stating that, to the knowledge of the
signer, no Event of Default has occurred and is continuing;
(c) an Expert's Certificate made and dated not more than ninety
(90) days prior to the date of such Company Order:
(i) describing the property to be released;
(ii) stating the Fair Value, in the judgment of the signers,
of the property to be released;
(iii) stating the Cost of the property to be released (or, if
the Fair Value to the Company of such property at the time the same became
Funded Property was certified to be an amount less than the Cost thereof,
then such Fair Value, as so certified, in lieu of Cost); and
(iv) stating that, in the judgment of the signers, such
release will not impair the security under this Indenture in contravention
of the provisions hereof;
(d) an amount in cash to be held by the Trustee as part of the
Mortgaged Property, equal to the amount, if any, by which seventy percentum
(70%) of the amount referred to in clause (c)(iii) above exceeds the aggregate
of the following items:
(i) an amount equal to seventy percentum (70%) of the
aggregate principal amount of any obligations secured by Purchase Money
Lien delivered to the Trustee, to be held as part of the Mortgaged
Property, subject to the limitations hereafter in this Section set forth;
(ii) an amount equal to seventy percentum (70%) of the Cost
or Fair Value to the Company (whichever is less), after making any
deductions and any additions
59
pursuant to Section 1.03, of any Property Additions not constituting
Funded Property described in an Expert's Certificate, dated not more than
ninety (90) days prior to the date of the Company Order requesting such
release and complying with clause (ii) and, to the extent applicable,
clause (iii) in Section 4.02(b), delivered to the Trustee; provided,
however, that the deductions and additions contemplated by Section 1.03
shall not be required to be made if such Property Additions were acquired,
made or constructed on or after the ninetieth (90th) day preceding the
date of such Company Order;
(iii) the aggregate principal amount of Securities to the
authentication and delivery of which the Company shall be entitled under
the provisions of Section 4.03, by virtue of compliance with all
applicable provisions of Section 4.03 (except as hereinafter in this
Section otherwise provided); provided, however, that such release shall
operate as a waiver by the Company of the right to the authentication and
delivery of such Securities and, to such extent, no such Securities may
thereafter be authenticated and delivered hereunder; and any Securities
which were the basis of such right to the authentication and delivery of
Securities so waived shall be deemed to have been made the basis of such
release of property;
(iv) any amount in cash and/or an amount equal to seventy
percentum (70%) of the aggregate principal amount of any obligations
secured by Purchase Money Lien that, in either case, is evidenced to the
Trustee by a certificate of the trustee or other holder of a Lien prior to
the Lien of this Indenture to have been received by such trustee or other
holder in accordance with the provisions of such Lien in consideration for
the release of such property or any part thereof from such Lien, all
subject to the limitations hereafter in this Section set forth;
(v) the aggregate principal amount of any Outstanding
Securities delivered to the Trustee; and
(vi) any taxes and expenses incidental to any sale, exchange,
dedication or other disposition of the property to be released;
(e) if the release is on the basis of Property Additions or on the
basis of the right to the authentication and delivery of Securities under
Section 4.03, all documents contemplated below in this Section; and
(f) if the release is on the basis of the delivery to the Trustee
or to the trustee or other holder of a prior Lien of obligations secured by
Purchase Money Lien, all documents contemplated below in this Section, to the
extent required.
If and to the extent that the release of property is, in whole or in
part, based upon Property Additions (as permitted under the provisions of clause
(d)(ii) in the first paragraph of this Section), the Company shall, subject to
the provisions of said clause (d)(ii) and except as hereafter in this paragraph
provided, comply with all applicable provisions of this Indenture as if such
Property Additions were to be made the basis of the authentication and delivery
of Securities equal in principal amount to seventy percentum (70%) of the Cost
(or, as to property of which the Fair Value to the Company at the time the same
became Funded Property was
60
certified to be an amount less than the Cost thereof, such Fair Value, as so
certified, in lieu of Cost) of that portion of the property to be released which
is to be released on the basis of such Property Additions, as shown by the
Expert's Certificate required by clause (c) in the first paragraph of this
Section; provided, however, that the Cost of any Property Additions received or
to be received by the Company in whole or in part as consideration in exchange
for the property to be released shall for all purposes of this Indenture be
deemed to be the amount stated in the Expert's Certificate provided for in
clause (c) in the first paragraph of this Section to be the Fair Value of the
property to be released (x) plus the amount of any cash and the fair market
value of any other consideration, further to be stated in such Expert's
Certificate, paid and/or delivered or to be paid and/or delivered by, and the
amount of any obligations assumed or to be assumed by, the Company in connection
with such exchange as additional consideration for such Property Additions
and/or (y) less the amount of any cash and the fair market value of any other
consideration, which shall also be stated in such Expert's Certificate, received
or to be received by the Company in connection with such exchange in addition to
such Property Additions. If and to the extent that the release of property is in
whole or in part based upon the right to the authentication and delivery of
Securities under Section 4.03 (as permitted under the provisions of clause
(d)(iii) in the first paragraph of this Section), the Company shall, except as
hereafter in this paragraph provided, comply with all applicable provisions of
Section 4.03 relating to such authentication and delivery. Notwithstanding the
foregoing provisions of this paragraph, in no event shall the Company be
required to deliver the documents specified in Section 4.01.
If the release of property is, in whole or in part, based upon the
delivery to the Trustee or the trustee or other holder of a Lien prior to the
Lien of this Indenture of obligations secured by Purchase Money Lien, the
Company shall deliver to the Trustee:
(a) an Officer's Certificate (i) stating that no event has
occurred and is continuing which entitles the holder of such Purchase
Money Lien to accelerate the maturity of the obligations, if any,
outstanding thereunder and (ii) reciting the aggregate principal amount of
obligations, if any, then outstanding thereunder in addition to the
obligations then being delivered in connection with the release of such
property and the terms and conditions, if any, on which additional
obligations secured by such Purchase Money Lien are permitted to be
issued; and
(b) an Opinion of Counsel stating that, in the opinion of the
signer, (i) such obligations are valid obligations, entitled to the
benefit of such Purchase Money Lien equally and ratably with all other
obligations, if any, then outstanding thereunder, (ii) that such Purchase
Money Lien constitutes, or, upon the delivery of, and/or the filing and/or
recording in the proper places and manner of, the instruments of
conveyance, assignment or transfer, if any, specified in such opinion,
will constitute, a Lien upon the property to be released, subject to no
Lien prior thereto except Liens generally of the character of Permitted
Liens and such Liens, if any, as shall have existed thereon immediately
prior to such release as Liens prior to the Lien of this Indenture, (iii)
if any obligations in addition to the obligations being delivered in
connection with such release of property are then outstanding, or are
permitted to be issued, under such Purchase Money Lien, (A) that such
Purchase Money Lien constitutes, or, upon the delivery of, and/or the
filing and/or recording in the proper places and manner of, the
instruments of conveyance, assignment or transfer, if any, specified in
such opinion, will constitute, a
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Lien upon all other property, if any, purporting to be subject thereto,
subject to no Lien prior thereto except Liens generally of the character
of Permitted Liens and Liens permitted to exist or to be hereafter created
under Section 6.06 and (B) that the terms of such Purchase Money Lien, as
then in effect, do not permit the issuance of obligations thereunder
except on the basis of property generally of the character of Property
Additions, the retirement or deposit of outstanding obligations, the
deposit of prior Lien obligations or the deposit of cash.
Anything herein to the contrary notwithstanding (a) the aggregate
principal amount of obligations secured by Purchase Money Lien which may be used
pursuant to subclause (i) and/or subclause (iv) of clause (d) in the first
paragraph of this Section as the basis for the release of property from the Lien
of this Indenture shall not exceed seventy-five percentum (75%) of the Fair
Value of the property to be released, as certified pursuant to clause (c)(ii) in
the first paragraph of this Section, and (b) no obligations secured by Purchase
Money Lien shall be used as the basis for the release of property hereunder, if
the aggregate principal amount of such obligations to be used by the Company
pursuant to subclause (i) and/or subclause (iv) of such clause (d) plus the
aggregate principal amount used by the Company pursuant to said subclause (i)
and subclause (iv) in connection with all previous releases of property from the
Lien hereof on the basis of obligations secured by Purchase Money Lien
theretofore delivered to and then held by the Trustee or the trustee or other
holder of a Lien prior to the Lien of this Indenture shall, immediately after
the release then being applied for, exceed forty percentum (40%) of the sum of
(1) the aggregate principal amount of Securities then Outstanding and (2) the
aggregate principal amount of First Mortgage Bonds then Outstanding; provided,
however, that the limitation set forth in clause (a) above shall not be
applicable if no additional obligations are then outstanding, or are permitted
to be issued, under the Purchase Money Lien securing such obligations; and
provided, further, that there shall not be taken into account for purposes of
the calculation contemplated in clause (b) above any obligations secured by
Purchase Money Lien with respect to which there shall have been delivered to the
Trustee:
(x) an Officer's Certificate (i) if any obligations shall then
be outstanding under such Purchase Money Lien and/or additional
obligations are permitted to be issued thereunder, either (A) stating that
the terms of such Purchase Money Lien, as then in effect, do not permit
the issuance of obligations thereunder on the basis of property additions
in a principal amount exceeding seventy percentum (70%) of the balance of
the cost or fair value of such property additions to the issuer thereof
(whichever shall be less) after making deductions and additions similar to
those provided for in Section 1.03, or (B) in the event that the
statements contained in clause (A) above cannot be made, stating that such
issuer has irrevocably waived its right to the authentication and delivery
of obligations under such Purchase Money Lien (1) on any basis, in a
principal amount equal to the excess of (I) the aggregate principal amount
of obligations, if any, then outstanding under such Purchase Money Lien
which were issued on the basis of property additions or on the basis of
the retirement of obligations which were issued (whether directly or
indirectly when considered in light of the successive issuance and
retirement of obligations) on the basis of property additions over (II) an
amount equal to seventy percentum (70%) of the aggregate Dollar amount of
property additions certified as the basis for the issuance of such
obligations then outstanding and (2) on the basis of property additions,
in a principal amount exceeding seventy percentum
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(70%) of the balance of the cost or fair value thereof to such issuer
(whichever shall be less) after making deductions and additions similar to
those provided for in Section 1.03 and (ii) stating either (A) that the
obligations secured by such Purchase Money Lien delivered to the Trustee
or to the trustee or other holder of a Lien prior to the Lien of this
Indenture as the basis for such release of property contain a provision
for mandatory redemption upon the acceleration of the maturity of all
Outstanding Securities following an Event of Default (whether or not such
redemption may be rescinded upon the rescission of such acceleration) or
(B) that so long as such obligations are held by the Trustee or the
trustee or other holder of such a prior Lien, an Event of Default under
this Indenture constitutes a matured event of default under such Purchase
Money Lien (provided, however, that the waiver or cure of such Event of
Default hereunder and the rescission and annulment of the consequences
thereof may constitute a cure of the corresponding event of default under
such Purchase Money Lien and a rescission and annulment of the
consequences thereof); and
(y) an Opinion or Opinions of Counsel to the effect that (i)
if any obligations shall then be outstanding under such Purchase Money
Lien and/or additional obligations are permitted to be issued thereunder,
to the effect either (A) that the terms of such Purchase Money Lien, as
then in effect, do not permit the issuance of obligations thereunder upon
the basis of property additions in a principal amount exceeding seventy
percentum (70%) of the balance of the cost or the fair value thereof to
the issuer of such obligations (whichever shall be less) after making
deductions and additions similar to those provided for in Section 1.03,
or, if such is not the case, (B) that the waivers contemplated by clause
(x)(i)(B) above have been duly made and (ii) to the effect either (A) that
the obligations secured by such Purchase Money Lien delivered to the
Trustee or to the trustee or other holder of a Lien prior to the Lien of
this Indenture as the basis for such release of property contain a
provision for mandatory redemption upon an acceleration) of the maturity
of all Outstanding Securities following an Event of Default (whether or
not such redemption may be rescinded upon the rescission of such
acceleration) or (B) that, so long as such obligations are held by the
Trustee or the trustee or other holder of such a prior Lien, an Event of
Default under this Indenture constitutes a matured event of default under
such Purchase Money Lien (provided, however, that the waiver or cure of
such Event of Default hereunder and the rescission and annulment of the
consequences thereof may constitute a cure of the corresponding event of
default under such Purchase Money Lien and a rescission and annulment of
the consequences thereof).
If (a) any property to be released from the Lien of this Indenture
under any provision of this Article (other than Section 8.07) is subject to a
Lien prior to the Lien hereof and is to be sold, exchanged, dedicated or
otherwise disposed of subject to such prior Lien and (b) after such release,
such prior Lien will not be a Lien on any property subject to the Lien hereof,
then the Fair Value of such property to be released shall be deemed, for all
purposes of this Indenture, to be the value thereof unencumbered by such prior
Lien less the principal amount of the indebtedness secured by such prior Lien.
Any Outstanding Securities delivered to the Trustee pursuant to
clause (d) in the first paragraph of this Section shall forthwith be canceled by
the Trustee. Any cash and/or
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obligations so deposited with the Trustee, and the proceeds of any such
obligations, shall be held as part of the Mortgaged Property and shall be
withdrawn, released, used or applied in the manner, to the extent and for the
purposes, and subject to the conditions, provided in Section 8.06.
Anything in this Indenture to the contrary notwithstanding, if
property to be released constitutes Funded Property in part only, the Company
shall obtain the release of the part of such property which constitutes Funded
Property under this Section 8.03 and obtain the release of the part of such
property which does not constitute Funded Property under Section 8.04. In such
event, (a) the application of Property Additions in the release under this
Section 8.03 as contemplated in clause (d)(ii) in the first paragraph thereof
shall be taken into account in clause (v) or clause (vi), whichever may be
applicable, of the Expert's Certificate described in clause (c) in Section 8.04
and (b) the Trustee shall, at the election of the Company, execute and deliver a
separate instrument of release with respect to the property released under each
of such Sections or a consolidated instrument of release with respect to the
property released under both of such Sections considered as a whole.
SECTION 8.04 Release of Property Not Constituting Funded Property.
Unless an Event of Default shall have occurred and be continuing,
the Company may obtain the release of any part of the Mortgaged Property, or any
interest therein, which does not constitute Funded Property, and the Trustee
shall release all its right, title and interest in and to the same from the Lien
hereof, upon receipt by the Trustee of:
(a) a Company Order requesting the release of such property and
transmitting therewith a form of instrument to effect such release;
(b) an Officer's Certificate stating that, to the knowledge of the
signer, no Event of Default has occurred and is continuing;
(c) an Expert's Certificate, made and dated not more than ninety
(90) days prior to the date of such Company Order:
(i) describing the property to be released;
(ii) stating the Fair Value, in the judgment of the signers,
of the property to be released;
(iii) stating the Cost of the property to be released;
(iv) stating that the property to be released does not
constitute Funded Property;
(v) if true, stating either (A) that the aggregate amount of
the Cost or Fair Value to the Company (whichever is less) of all Property
Additions which do not constitute Funded Property (excluding the property
to be released), after making deductions therefrom and additions thereto
of the character contemplated by Section 1.03, is not less than zero (0)
or (B) that the Cost or Fair Value (whichever is less) of the
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property to be released does not exceed the aggregate Cost or Fair Value
to the Company (whichever is less) of Property Additions acquired, made or
constructed on or after the ninetieth (90th) day prior to the date of the
Company Order requesting such release;
(vi) if neither of the statements contemplated in subclause
(v) above can be made, stating the amount by which zero (0) exceeds the
amount referred to in subclause (v)(A) above (showing in reasonable detail
the calculation thereof); and
(vii) stating that, in the judgment of the signers, such
release will not impair the security under this Indenture in contravention
of the provisions hereof; and
(d) if the Expert's Certificate required by clause (c) above
contains neither of the statements contemplated in clause (c)(v) above, an
amount in cash, to be held by the Trustee as part of the Mortgaged Property,
equal to the amount, if any, by which seventy percentum (70%) of the lower of
(i) the Cost or Fair Value (whichever shall be less) of the property to be
released and (ii) the amount shown in clause (c)(vi) above exceeds the aggregate
of items of the character described in subclauses (iii) and (v) of clause (d) in
the first paragraph of Section 8.03 then to be used as a credit under this
Section 8.04 (subject, however, to the same limitations and conditions with
respect to such items as are set forth in Section 8.03).
Anything herein to the contrary notwithstanding, if any part of the
Mortgaged Property is to be released prior to the delivery of the Initial
Expert's Certificate pursuant to Section 4.02(b)(ii), the Company shall deliver
to the Trustee an Initial Expert's Certificate complying with the provisions of
Section 4.02(b)(ii), except that there shall be stated in clause (M) the sum of
(x) the aggregate principal amount of Securities then Outstanding and (y) the
aggregate principal amount of First Mortgage Bonds then Outstanding. Such
Initial Expert's Certificate shall be accompanied by the documents specified in
clauses (iii), (iv) and (v) of Section 4.02(b). Thereupon, the part of the
Mortgaged Property to be released shall be released pursuant to Section 8.03, to
the extent the same shall constitute Funded Property, and/or pursuant to Section
8.04, to the extent the same shall not constitute Funded Property.
SECTION 8.05 Release of Minor Properties.
Notwithstanding the provisions of Sections 8.03 and 8.04, unless an
Event of Default shall have occurred and be continuing, the Company may obtain
the release from the Lien hereof of any part of the Mortgaged Property, or any
interest therein, and the Trustee shall whenever from time to time requested by
the Company in a Company Order transmitting therewith a form of instrument to
effect such release, and without requiring compliance with any of the provisions
of Section 8.03 or 8.04, release from the Lien hereof all the right, title and
interest of the Trustee in and to the same provided that the aggregate Fair
Value of the property to be so released on any date in a given calendar year,
together with all other property released pursuant to this Section 8.05 in such
calendar year, shall not exceed the greater of (a) Ten Million Dollars
($10,000,000) and (b) three percentum (3%) of the sum of (i) the aggregate
principal amount of Securities then Outstanding and (ii) the aggregate principal
amount of First Mortgage Bonds then Outstanding. Prior to the granting of any
such release, there shall be delivered to the Trustee (x) an Officer's
Certificate stating that, to the knowledge of the signer, no Event of Default
has occurred and is continuing and (y) an Expert's Certificate stating, in the
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judgment of the signers, the Fair Value of the property to be released, the
aggregate Fair Value of all other property theretofore released pursuant to this
Section in such calendar year and, as to Funded Property, the Cost thereof (or,
if the Fair Value to the Company of such property at the time the same became
Funded Property was certified to be an amount less than the Cost thereof, then
such Fair Value, as so certified, in lieu of Cost), and that, in the judgment of
the signers, the release thereof will not impair the security under this
Indenture in contravention of the provisions hereof. On or before December 31st
of each calendar year, the Company shall deposit with the Trustee an amount in
cash equal to seventy percentum (70%) of the aggregate Cost of the properties
constituting Funded Property so released during such year (or, if the Fair Value
to the Company of any particular property at the time the same became Funded
Property was certified to be an amount less than the Cost thereof, then such
Fair Value, as so certified, in lieu of Cost); provided, however, that no such
deposit shall be required to be made hereunder to the extent that cash or other
consideration shall, as indicated in an Officer's Certificate delivered to the
Trustee, have been deposited with the trustee or other holder of the SPPC 1940
Mortgage or other Lien prior to the Lien of this Indenture in accordance with
the provisions thereof; and provided, further, that the amount of cash so
required to be deposited may be reduced, at the election of the Company, by the
items specified in clause (d) in the first paragraph of Section 8.03, subject to
all of the limitations and conditions specified in such Section, to the same
extent as if such property were being released pursuant to Section 8.03. Any
cash deposited with the Trustee under this Section may thereafter be withdrawn,
used or applied in the manner, to the extent and for the purposes, and subject
to the conditions, provided in Section 8.06.
SECTION 8.06 Withdrawal or Other Application of Funded Cash; Purchase Money
Obligations.
Subject to the provisions of Section 4.04 and except as hereafter in
this Section provided, unless an Event of Default shall have occurred and be
continuing, any Funded Cash held by the Trustee, and any other cash which is
required to be withdrawn, used or applied as provided in this Section,
(a) may be withdrawn from time to time by the Company to the extent
of an amount equal to seventy percentum (70%) of the Cost or the Fair Value to
the Company (whichever is less) of Property Additions not constituting Funded
Property, after making any deductions and additions pursuant to Section 1.03,
described in an Expert's Certificate, dated not more than ninety (90) days prior
to the date of the Company Order requesting such withdrawal and complying with
clause (ii) and, to the extent applicable, clause (iii) in Section 4.02(b),
delivered to the Trustee; provided, however, that the deductions and additions
contemplated by Section 1.03 shall not be required to be made if such Property
Additions were acquired, made or constructed on or after the ninetieth (90th)
day preceding the date of such Company Order;
(b) may be withdrawn from time to time by the Company in an amount
equal to the aggregate principal amount of Securities to the authentication and
delivery of which the Company shall be entitled under the provisions of Section
4.03 hereof, by virtue of compliance with all applicable provisions of Section
4.03 (except as hereinafter in this Section otherwise provided); provided,
however, that such withdrawal of cash shall operate as a waiver by the Company
of the right to the authentication and delivery of such Securities and, to such
extent, no such Securities may thereafter be authenticated and delivered
hereunder; and any such Securities
66
which were the basis of such right to the authentication and delivery of
Securities so waived shall be deemed to have been made the basis of such
withdrawal of cash;
(c) may be withdrawn from time to time by the Company in an amount
equal to the aggregate principal amount of any Outstanding Securities delivered
to the Trustee;
(d) may, upon the request of the Company, be used by the Trustee for
the purchase of Securities in the manner, at the time or times, in the amount or
amounts, at the price or prices and otherwise as directed or approved by the
Company, all subject to the limitations hereafter in this Section set forth; or
(e) may, upon the request of the Company, be applied by the Trustee
to the payment (or provision therefor pursuant to Article IX) at Stated Maturity
of any Securities or to the redemption (or similar provision therefor) of any
Securities which are, by their terms, redeemable, in each case of such series as
may be designated by the Company, any such redemption to be in the manner and as
provided in Article V, all subject to the limitations hereafter in this Section
set forth.
Such moneys shall, from time to time, be paid or used or applied by
the Trustee, as aforesaid, upon the request of the Company in a Company Order,
and upon receipt by the Trustee of an Officer's Certificate stating that, to the
knowledge of the signer, no Event of Default has occurred and is continuing. If
and to the extent that the withdrawal of cash is based upon Property Additions
(as permitted under the provisions of clause (a) above), the Company shall,
subject to the provisions of said clause (a) and except as hereafter in this
paragraph provided, comply with all applicable provisions of this Indenture as
if such Property Additions were made the basis for the authentication and
delivery of Securities equal in principal amount to the cash so to be withdrawn.
If and to the extent that the withdrawal of cash is based upon the right to the
authentication and delivery of Securities (as permitted under the provisions of
clause (b) above), the Company shall, except as hereafter in this paragraph
provided, comply with all applicable provisions of Section 4.03 relating to such
authentication and delivery. Notwithstanding the foregoing provisions of this
paragraph, in no event shall the Company be required to deliver the documents
specified in Section 4.01.
Notwithstanding the generality of clauses (d) and (e) above, no cash
to be applied pursuant to such clauses shall be applied to the payment of an
amount in excess of the principal amount of any Securities to be purchased, paid
or redeemed except to the extent that the aggregate principal amount of all
Securities theretofore, and of all Securities then to be, purchased, paid or
redeemed pursuant to such clauses is not less than the aggregate cost for
principal of, premium, if any, and accrued interest, if any, on and brokerage
commissions, if any, with respect to, such Securities.
Any Outstanding Securities delivered to the Trustee pursuant to
clause (c) in the first paragraph of this Section shall forthwith be canceled by
the Trustee.
Any obligations secured by Purchase Money Lien delivered to the
Trustee in consideration of the release of property from the Lien of this
Indenture, together with any evidence of such Purchase Money Lien held by the
Trustee, shall be released from the Lien of
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this Indenture and delivered to or upon the order of the Company upon payment by
the Company to the Trustee of an amount in cash equal to the aggregate principal
amount of such obligations less the aggregate amount theretofore paid to the
Trustee (by the Company, the obligor or otherwise) in respect of the principal
of such obligations.
The principal of and interest on any such obligations secured by
Purchase Money Lien held by the Trustee shall be held by the Trustee as and when
the same are received by the Trustee. The interest received by the Trustee on
any such obligations shall be deemed not to constitute Funded Cash and shall be
remitted to the Company; provided, however, that if an Event of Default shall
have occurred and be continuing, such proceeds shall be held as part of the
Mortgaged Property until such Event of Default shall have been cured or waived.
The Trustee shall have and may exercise all the rights and powers of
any owner of such obligations and of all substitutions therefor and, without
limiting the generality of the foregoing, may collect and receive all insurance
moneys payable to it under any of the provisions thereof and apply the same in
accordance with the provisions thereof, may consent to extensions thereof at a
higher or lower rate of interest, may join in any plan or plans of voluntary or
involuntary reorganization or readjustment or rearrangement and may accept and
hold hereunder new obligations, stocks or other securities issued in exchange
therefor under any such plan. Any discretionary action which the Trustee may be
entitled to take in connection with any such obligations or substitutions
therefor shall be taken, so long as no Event of Default shall have occurred and
be continuing, in accordance with a Company Order, and, during the continuance
of an Event of Default, in its own discretion.
Anything herein to the contrary notwithstanding, the Company may
irrevocably waive all right to the withdrawal pursuant to this Section of, and
any other rights with respect to, any obligations secured by Purchase Money Lien
held by the Trustee, and the proceeds of any such obligations, by delivery to
the Trustee of a Company Order:
(a) specifying such obligations and stating that the Company
thereby waives all rights to the withdrawal thereof and of the proceeds
thereof pursuant to this Section, and any other rights with respect
thereto; and
(b) directing that the principal of such obligations be
applied as provided in clause (e) in the first paragraph of this Section,
specifying the Securities to be paid or redeemed or for the payment or
redemption of which payment is to be made.
Following any such waiver, the interest on any such obligations shall be applied
to the payment of interest, if any, on the Securities to be paid or redeemed or
for the payment or redemption of which provision is to be made, as specified in
the aforesaid Company Order, as and when such interest shall become due from
time to time, and any excess funds remaining from time to time after such
application shall be applied to the payment of interest on any other Securities
as and when the same shall become due. Pending any such application, the
interest on such obligations shall be invested in Investment Securities. The
principal of any such obligations shall be applied solely to the payment of
principal of the Securities to be paid or redeemed or for the payment or
redemption of which provision is to be made, as specified in the aforesaid
Company Order. Pending such application, the principal of such obligations shall
be invested in Eligible
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Obligations. The obligation of the Company to pay the principal of such
Securities when the same shall become due at maturity, shall be offset and
reduced by the amount of the proceeds of such obligations then held, and to be
applied, by the Trustee in accordance with this paragraph.
SECTION 8.07 Release of Property Taken by Eminent Domain, etc.
Should any of the Mortgaged Property, or any interest therein, be
taken by exercise of the power of eminent domain or be sold to an entity
possessing the power of eminent domain under a threat to exercise the same, and
should the Company elect not to obtain the release of such property pursuant to
other provisions of this Article, the Trustee shall, upon request of the Company
evidenced by a Company Order transmitting therewith a form of instrument to
effect such release, release from the Lien hereof all its right, title and
interest in and to the property so taken or sold (or with respect to an interest
in property, subordinate the Lien hereof to such interest), upon receiving (a)
an Opinion of Counsel to the effect that such property has been taken by
exercise of the power of eminent domain or has been sold to an entity possessing
the power of eminent domain under threat of an exercise of such power, (b) an
Officer's Certificate stating the amount of net proceeds received or to be
received for such property so taken or sold, and the amount so stated shall be
deemed to be the Fair Value of such property for the purpose of any notice to
the Holders of Securities, (c) if any portion of such property constitutes
Funded Property, an Expert's Certificate stating the Cost thereof (or, if the
Fair Value to the Company of such portion of such property at the time the same
became Funded Property was certified to be an amount less than the Cost thereof,
then such Fair Value, as so certified, in lieu of Cost) and (d) if any portion
of such property constitutes Funded Property, a deposit by the Company of an
amount in cash equal to seventy percentum (70%) of the Cost or Fair Value stated
in the Expert's Certificate delivered pursuant to clause (c) above; provided,
however, that the amount required to be so deposited shall not exceed the
portion of the net proceeds received or to be received for such property so
taken or sold which is allocable on a pro-rata or other reasonable basis to the
portion of such property constituting Funded Property; and provided, further,
that no such deposit shall be required to be made hereunder if the proceeds of
such taking or sale shall, as indicated in an Officer's Certificate delivered to
the Trustee, have been deposited with the trustee or other holder of the SPPC
1940 Mortgage or other Lien prior to the Lien of this Indenture. Any cash
deposited with the Trustee under this Section may thereafter be withdrawn, used
or applied in the manner, to the extent and for the purposes, and subject to the
conditions, provided in Section 8.06.
SECTION 8.08 Disclaimer or Quitclaim.
In case the Company has sold, exchanged, dedicated or otherwise
disposed of, or has agreed or intends to sell, exchange, dedicate or otherwise
dispose of, or a Governmental Authority has ordered the Company to divest itself
of, any Excepted Property or any other property not subject to the Lien hereof,
or the Company desires to disclaim or quitclaim title to property to which the
Company does not purport to have title, the Trustee shall, from time to time,
disclaim or quitclaim such property upon receipt by the Trustee of the
following:
(a) a Company Order requesting such disclaimer or quitclaim and
transmitting therewith a form of instrument to effect such disclaimer or
quitclaim;
69
(b) an Officer's Certificate describing the property to be
disclaimed or quitclaimed; and
(c) an Opinion of Counsel stating the signer's opinion that such
property is not subject to the Lien hereof or required to be subject thereto by
any of the provisions hereof.
SECTION 8.09 Miscellaneous.
(a) The Expert's Certificate as to the Fair Value of property to be
released from the Lien of this Indenture in accordance with any provision of
this Article, and as to the nonimpairment, by reason of such release, of the
security under this Indenture in contravention of the provisions hereof, shall
be made by an Independent Expert if the Fair Value of such property and of all
other property released since the commencement of the then current calendar
year, as set forth in the certificates required by this Indenture, is ten
percentum (10%) or more of the aggregate principal amount of the Securities at
the time Outstanding; but such Expert's Certificate shall not be required to be
made by an Independent Expert in the case of any release of property if the Fair
Value thereof, as set forth in the certificates required by this Indenture, is
less than Twenty-five Thousand Dollars ($25,000) or less than one percentum (1%)
of the aggregate principal amount of the Securities at the time Outstanding. To
the extent that the Fair Value of any property to be released from the Lien of
this Indenture shall be stated in an Independent Expert's Certificate, such Fair
Value shall not be required to be stated in any other Expert's Certificate
delivered in connection with such release.
(b) No release of property from the Lien of this Indenture effected
in accordance with the provisions, and in compliance with the conditions, set
forth in this Article and in Sections 1.04 and 1.05 shall be deemed to impair
the security of this Indenture in contravention of any provision hereof.
(c) If the Mortgaged Property shall be in the possession of a
receiver or trustee, lawfully appointed, the powers hereinbefore conferred upon
the Company with respect to the release of any part of the Mortgaged Property or
any interest therein or the withdrawal of cash may be exercised, with the
approval of the Trustee, by such receiver or trustee, notwithstanding that an
Event of Default may have occurred and be continuing, and any request,
certificate, appointment or approval made or signed by such receiver or trustee
for such purposes shall be as effective as if made by the Company or any of its
officers or appointees in the manner herein provided; and if the Trustee shall
be in possession of the Mortgaged Property under any provision of this
Indenture, then such powers may be exercised by the Trustee in its discretion
notwithstanding that an Event of Default may have occurred and be continuing.
(d) If the Company shall retain any interest in any property
released from the Lien of this Indenture as provided in Section 8.03, 8.04 or
8.05, this Indenture shall not become or be, or be required to become or be, a
Lien upon such property or such interest therein or any improvements, extensions
or additions to such property or renewals, replacements or substitutions of or
for such property or any part or parts thereof unless the Company shall execute
and deliver to the Trustee an indenture supplemental hereto, in recordable form,
containing a grant, conveyance, transfer and mortgage thereof. As used in this
subsection, the
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terms "improvements", "extensions" and "additions" shall be limited as set forth
in Section 13.01.
(e) Notwithstanding the occurrence and continuance of an Event of
Default, the Trustee, in its discretion, may release from the Lien hereof any
part of the Mortgaged Property or permit the withdrawal of cash, upon compliance
with the other conditions specified in this Article in respect thereof.
(f) No purchaser or grantee of property purporting to have been
released hereunder shall be bound to ascertain the authority of the Trustee to
execute the release, or to inquire as to any facts required by the provisions
hereof for the exercise of such authority; nor shall any purchaser or grantee of
any property or rights permitted by this Article to be sold, granted, exchanged,
dedicated or otherwise disposed of, be under obligation to ascertain or inquire
into the authority of the Company to make any such sale, grant, exchange,
dedication or other disposition.
ARTICLE IX
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SATISFACTION AND DISCHARGE
--------------------------
SECTION 9.01 Satisfaction and Discharge of Securities.
Any Security or Securities, or any portion of the principal amount
thereof, shall be deemed to have been paid for all purposes of this Indenture,
and the entire indebtedness of the Company in respect thereof shall be satisfied
and discharged, if there shall have been irrevocably deposited with the Trustee
or any Paying Agent (other than the Company), in trust:
(a) money (including Funded Cash not otherwise applied pursuant to
Section 8.06) in an amount which shall be sufficient, or
(b) in the case of a deposit made prior to the Maturity of such
Securities or portions thereof, Eligible Obligations, which shall not contain
provisions permitting the redemption or other prepayment thereof at the option
of the issuer thereof, the principal of and the interest on which when due,
without any regard to reinvestment thereof, will provide moneys which, together
with the money, if any, deposited with or held by the Trustee or such Paying
Agent, shall be sufficient, or
(c) a combination of (a) or (b) which shall be sufficient,
to pay when due the principal of and premium, if any, and interest, if any, due
and to become due on such Securities or portions thereof; provided, however,
that in the case of the provision for payment or redemption of less than all the
Securities of any series or Tranche, such Securities or portions thereof shall
have been selected by the Security Registrar as provided herein and, in the case
of a redemption, the notice requisite to the validity of such redemption shall
have been given or irrevocable authority shall have been given by the Company to
the Trustee to give such notice, under arrangements satisfactory to the Trustee;
and provided, further, that the Company shall have delivered to the Trustee and
such Paying Agent:
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(x) if such deposit shall have been made prior to the Maturity
of such Securities, a Company Order stating that the money and Eligible
Obligations deposited in accordance with this Section shall be held in
trust, as provided in Section 9.03;
(y) if Eligible Obligations shall have been deposited, an
Opinion of Counsel to the effect that such obligations constitute Eligible
Obligations and do not contain provisions permitting the redemption or
other prepayment thereof at the option of the issuer thereof, and an
opinion of an Independent public Accountant of nationally recognized
standing, selected by the Company, to the effect that the other
requirements set forth in clause (b) above have been satisfied; and
(z) if such deposit shall have been made prior to the Maturity
of such Securities, an Officer's Certificate stating the Company's
intention that, upon delivery of such Officer's Certificate, its
indebtedness in respect of such Securities or portions thereof will have
been satisfied and discharged as contemplated in this Section.
Upon the deposit of money or Eligible Obligations, or both, in
accordance with this Section, together with the documents required by clauses
(x), (y) and (z) above, the Trustee shall, upon Company Request, acknowledge in
writing that such Securities or portions thereof are deemed to have been paid
for all purposes of this Indenture and that the entire indebtedness of the
Company in respect thereof has been satisfied and discharged as contemplated in
this Section. In the event that all of the conditions set forth in the preceding
paragraph shall have been satisfied in respect of any Securities or portions
thereof except that, for any reason, the Officer's Certificate specified in
clause (z) (if otherwise required) shall not have been delivered, such
Securities or portions thereof shall nevertheless be deemed to have been paid
for all purposes of this Indenture, and the Holders of such Securities or
portions thereof shall nevertheless be no longer entitled to the benefit of the
Lien of this Indenture or of any of the covenants of the Company under Article
VI (except the covenants contained in Sections 6.02 and 6.03) or any other
covenants made in respect of such Securities or portions thereof as contemplated
by Section 3.01, but the indebtedness of the Company in respect of such
Securities or portions thereof shall not be deemed to have been satisfied and
discharged prior to Maturity for any other purpose; and, upon Company Request,
the Trustee shall acknowledge in writing that such Securities or portions
thereof are deemed to have been paid for all purposes of this Indenture.
If payment at Stated Maturity of less than all of the Securities of
any series, or any Tranche thereof, is to be provided for in the manner and with
the effect provided in this Section, the Security Registrar shall select such
Securities, or portions of principal amount thereof, in the manner specified by
Section 5.03 for selection for redemption of less than all the Securities of a
series or Tranche.
In the event that Securities which shall be deemed to have been paid
for purposes of this Indenture, and, if such is the case, in respect of which
the Company's indebtedness shall have been satisfied and discharged, all as
provided in this Section, do not mature and are not to be redeemed within the
sixty (60) day period commencing with the date of the deposit of moneys or
Eligible Obligations, as aforesaid, the Company shall, as promptly as
practicable, give a
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notice, in the same manner as a notice of redemption with respect to such
Securities, to the Holders of such Securities to the effect that such deposit
has been made and the effect thereof.
Notwithstanding that any Securities shall be deemed to have been
paid for purposes of this Indenture, as aforesaid, the obligations of the
Company and the Trustee in respect of such Securities under Sections 3.04, 3.05,
3.06, 5.04, 6.02, 6.03, 11.07 and 11.15 and this Article shall survive.
The Company shall pay, and shall indemnify the Trustee or any Paying
Agent with which Eligible Obligations shall have been deposited as provided in
this Section against, any tax, fee or other charge imposed on or assessed
against such Eligible Obligations or the principal or interest received in
respect of such Eligible Obligations, including, but not limited to, any such
tax payable by any entity deemed, for tax purposes, to have been created as a
result of such deposit.
Anything herein to the contrary notwithstanding, (a) if, at any time
after a Security would be deemed to have been paid for purposes of this
Indenture, and, if such is the case, the Company's indebtedness in respect
thereof would be deemed to have been satisfied and discharged, pursuant to this
Section (without regard to the provisions of this paragraph), the Trustee or any
Paying Agent, as the case may be, shall be required to return the money or
Eligible Obligations, or combination thereof, deposited with it as aforesaid to
the Company or its representative under any applicable Federal or State
bankruptcy, insolvency or other similar law, such Security shall thereupon be
deemed retroactively not to have been paid and any satisfaction and discharge of
the Company's indebtedness in respect thereof shall retroactively be deemed not
to have been effected, and such Security shall be deemed to remain Outstanding
and (b) any satisfaction and discharge of the Company's indebtedness in respect
of any Security shall be subject to the provisions of the last paragraph of
Section 6.03.
SECTION 9.02 Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further
effect (except as hereinafter expressly provided), and the Trustee, at the
expense of the Company, shall execute such instruments as the Company shall
reasonably request to evidence and acknowledge the satisfaction and discharge of
this Indenture, when:
(a) no Securities remain Outstanding hereunder; and
(b) the Company has paid or caused to be paid all other sums payable
hereunder by the Company;
provided, however, that if, in accordance with the last paragraph of Section
9.01, any Security, previously deemed to have been paid for purposes of this
Indenture, shall be deemed retroactively not to have been so paid, this
Indenture shall thereupon be deemed retroactively not to have been satisfied and
discharged, as aforesaid, and to remain in full force and effect, and the
Company shall execute and deliver such instruments as the Trustee shall
reasonably request to evidence and acknowledge the same.
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Notwithstanding the satisfaction and discharge of this Indenture as
aforesaid, the obligations of the Company and the Trustee under Sections 3.04,
3.05, 3.06, 5.04, 6.02, 6.03, 11.07 and 11.15 and this Article shall survive.
Upon satisfaction and discharge of this Indenture as provided in
this Section, the Trustee shall release, quit claim and otherwise turn over to
the Company the Mortgaged Property (other than money and Eligible Obligations
held by the Trustee pursuant to Section 9.03) and shall execute and deliver to
the Company such deeds and other instruments as, in the judgment of the Company,
shall be necessary, desirable or appropriate to effect or evidence such release
and quitclaim and the satisfaction and discharge of this Indenture.
SECTION 9.03 Application of Trust Money.
Neither the Eligible Obligations nor the money deposited pursuant to
Section 9.01, nor the principal or interest payments on any such Eligible
Obligations, shall be withdrawn or used for any purpose other than, and shall be
held in trust for, the payment of the principal of and premium, if any, and
interest, if any, on the Securities or portions of principal amount thereof in
respect of which such deposit was made, all subject, however, to the provisions
of Section 6.03; provided, however, that any cash received from such principal
or interest payments on such Eligible Obligations, if not then needed for such
purpose, shall, to the extent practicable and upon Company Request and delivery
to the Trustee of the documents referred to in clause (y) in the first paragraph
of Section 9.01, be invested in Eligible Obligations of the type described in
clause (b) in the first paragraph of Section 9.01 maturing at such times and in
such amounts as shall be sufficient, together with any other moneys and the
proceeds of any other Eligible Obligations then held by the Trustee, to pay when
due the principal of and premium, if any, and interest, if any, due and to
become due on such Securities or portions thereof on and prior to the Maturity
thereof, and interest earned from such reinvestment shall be paid over to the
Company as received, free and clear of the Lien of this Indenture, except the
Lien provided by Section 11.07; and provided, further, that any moneys held in
accordance with this Section on the Maturity of all such Securities in excess of
the amount required to pay the principal of and premium, if any, and interest,
if any, then due on such Securities shall be paid over to the Company free and
clear of the Lien of this Indenture, except the Lien provided by Section 11.07;
and provided, further, that if an Event of Default shall have occurred and be
continuing, moneys to be paid over to the Company pursuant to this Section shall
be held as part of the Mortgaged Property until such Event of Default shall have
been waived or cured.
ARTICLE X
---------
EVENTS OF DEFAULT; REMEDIES
---------------------------
SECTION 10.01 Events of Default.
"Event of Default", wherever used herein with respect to the
Securities, means any of the following events which shall have occurred and be
continuing:
(a) failure to pay interest, if any, on any Security within sixty
(60) days after the same becomes due and payable; or
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(b) failure to pay the principal of or premium, if any, on any
Security within three (3) Business Days after its Maturity; or
(c) failure to perform or breach of any covenant or warranty of the
Company in this Indenture (other than a covenant or warranty a default in the
performance of which or breach of which is elsewhere in this Section
specifically dealt with) for a period of ninety (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 at least thirty-three percentum (33%)
in principal amount of the Securities then Outstanding, 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, unless the Trustee, or the
Trustee and the Holders of a principal amount of Securities not less than the
principal amount of Securities the Holders of which gave such notice, as the
case may be, shall agree in writing to an extension of such period prior to its
expiration; provided, however, that the Trustee, or the Trustee and the Holders
of such principal amount of Securities, as the case may be, shall be deemed to
have agreed to an extension of such period if corrective action is initiated by
the Company within such period and is being diligently pursued; or
(d) the entry by a court having jurisdiction in the premises of (i)
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 (ii) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition by
one or more Persons other than the Company 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 for the Company or for any
substantial part of its property, or ordering the winding up or liquidation of
its affairs, and any such decree or order for relief or any such other decree or
order shall have remained unstayed and in effect for a period of ninety (90)
consecutive days; or
(e) 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 a 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 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 authorization of such action by the Board of Directors;
or
(f) the occurrence of a matured event of default under the SPPC 1940
Mortgage (other than any such matured event of default which (i) is of similar
kind or character to the Event of Default described in clause (c) above and (ii)
has not resulted in the acceleration of the First Mortgage Bonds Outstanding
under the SPPC 1940 Mortgage); provided, however,
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that, anything in this Indenture to the contrary notwithstanding, the waiver or
cure of such event of default under the SPPC 1940 Mortgage and the rescission
and annulment of the consequences thereof under the SPPC 1940 Mortgage shall
constitute a cure of the corresponding Event of Default hereunder and a
rescission and annulment of the consequences thereof.
SECTION 10.02 Acceleration of Maturity; Rescission and Annulment.
If an Event of Default shall have occurred and be continuing, then
in every such case the Trustee or the Holders of not less than thirty-three
percentum (33%) in principal amount of the Securities then Outstanding may
declare the principal amount (or, if any of the Securities are Discount
Securities, such portion of the principal amount of such Securities as may be
specified in the terms thereof as contemplated by Section 3.01) of all
Securities then Outstanding to be due and payable immediately, by a notice in
writing to the Company (and to the Trustee if given by Holders), and upon such
declaration such principal amount (or specified amount), together with premium,
if any, and accrued interest, if any, thereon, shall become immediately due and
payable, all subject, however, in the case of an Event of Default described in
clause (f) of Section 10.01, to the proviso contained in such clause (f).
At any time after such a declaration of acceleration of the maturity
of the Securities then Outstanding shall have been made, but before any sale of
any of the Mortgaged Property has been made and before a judgment or decree for
payment of the money due shall have been obtained by the Trustee as provided in
this Article, the Event or Events of Default giving rise to such declaration of
acceleration shall, without further act, be deemed to have been cured, and such
declaration and its consequences shall, without further act, be deemed to have
been rescinded and annulled, if
(a) the Company shall have paid or deposited with the Trustee a sum
sufficient to pay
(i) all overdue interest, if any, on all Securities then
Outstanding;
(ii) the principal of and premium, if any, on any Securities
then Outstanding which have become due otherwise than by such declaration
of acceleration and interest thereon at the rate or rates prescribed
therefor in such Securities; and
(iii) all amounts due to the Trustee under Section 11.07;
and
(b) any other Event or Events of Default, other than the non-payment
of the principal of Securities which shall have become due solely by such
declaration of acceleration, shall have been cured or waived as provided in
Section 10.17.
No such rescission shall affect any subsequent Event of Default or impair any
right consequent thereon.
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SECTION 10.03 Entry upon Mortgaged Property.
If an Event of Default shall have occurred and be continuing, the
Company, upon demand of the Trustee and if and to the extent permitted by law,
shall forthwith surrender to the Trustee the actual possession of, and the
Trustee, by such officers or agents as it may appoint, may enter upon and take
possession of, the Mortgaged Property; and the Trustee may hold, operate and
manage the Mortgaged Property and make all needful repairs and such renewals,
replacements, betterments and improvements as to the Trustee shall seem prudent;
and the Trustee may receive the rents, issues, profits, revenues and other
income of the Mortgaged Property, to the extent, if any, that the same shall not
then constitute Excepted Property; and, after deducting the costs and expenses
of entering, taking possession, holding, operating and managing the Mortgaged
Property, as well as payments for insurance and taxes and other proper charges
upon the Mortgaged Property prior to the Lien of this Indenture and reasonable
compensation to itself, its agents and counsel, the Trustee may apply the same
as provided in Section 10.07. Whenever all that is then due in respect of the
principal of and premium, if any, and interest, if any, on the Securities and
under any of the terms of this Indenture shall have been paid and all defaults
hereunder shall have been cured or shall have been waived as provided in Section
10.17, the Trustee shall surrender possession of the Mortgaged Property to the
Company.
SECTION 10.04 Power of Sale; Suits for Enforcement.
If an Event of Default shall have occurred and be continuing, the
Trustee, by such officers or agents as it shall appoint, with or without entry,
in its discretion may, subject to the provisions of Section 10.16 and if and to
the extent permitted by law:
(a) sell, subject to any mandatory requirements of applicable law,
the Mortgaged Property as an entirety, or in such parcels as the Holders of a
majority in principal amount of the Securities then Outstanding shall in writing
request, or in the absence of such request, as the Trustee may determine, to the
highest bidder at public auction at such place and at such time (which sale may
be adjourned by the Trustee from time to time in its discretion by announcement
at the time and place fixed for such sale, without further notice) and upon such
terms as the Trustee may fix and briefly specify in a notice of sale to be
published once in each week for four successive weeks prior to such sale in an
Authorized Publication in each Place of Payment for the Securities of each
series; or
(b) proceed to protect and enforce its rights and the rights of the
Holders of Securities under this Indenture by sale pursuant to judicial
proceedings or by a suit, action or proceeding in equity or at law or otherwise,
whether for the specific performance of any covenant or agreement contained in
this Indenture or in aid of the execution of any power granted in this Indenture
or for the foreclosure of this Indenture or for the enforcement of any other
legal, equitable or other remedy, as the Trustee, being advised by counsel,
shall deem most effectual to protect and enforce any of the rights of the
Trustee or the Holders of Securities.
SECTION 10.05 Incidents of Sale.
Upon any sale of any of the Mortgaged Property, whether made under
the power of sale hereby given or pursuant to judicial proceedings, to the
extent permitted by law:
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(a) the principal amount (or, if any of the Securities are Discount
Securities, such portion of the principal amount of such Securities as may be
specified in the terms thereof as contemplated by Section 3.01) of all
Outstanding Securities, if not previously due, shall at once become and be
immediately due and payable, together with premium, if any, and accrued
interest, if any, thereon;
(b) any Holder or Holders of Securities or the Trustee may bid for
and purchase the property offered for sale, and upon compliance with the terms
of sale may hold, retain and possess and dispose of such property, without
further accountability, and may, in paying the purchase money therefor, deliver
any Outstanding Securities or claims for interest thereon in lieu of cash to the
amount which shall, upon distribution of the net proceeds of such sale, be
payable thereon, and such Securities, in case the amounts so payable thereon
shall be less than the amount due thereon, shall be returned to the Holders
thereof after being appropriately stamped to show partial payment;
(c) the Trustee may make and deliver to the purchaser or purchasers
a good and sufficient deed, bill of sale and instrument of assignment and
transfer of the property sold;
(d) the Trustee is hereby irrevocably appointed the true and lawful
attorney of the Company, in its name and stead, to make all necessary deeds,
bills of sale and instruments of assignment and transfer of the property so
sold; and for that purpose it may execute all necessary deeds, bills of sale and
instruments of assignment and transfer, and may substitute one or more persons,
firms or corporations with like power, the Company hereby ratifying and
confirming all that its said attorney or such substitute or substitutes shall
lawfully do by virtue hereof; but, if so requested by the Trustee or by any
purchaser, the Company shall ratify and confirm any such sale or transfer by
executing and delivering to the Trustee or to such purchaser or purchasers all
proper deeds, bills of sale, instruments of assignment and transfer and releases
as may be designated in any such request;
(e) all right, title, interest, claim and demand whatsoever, either
at law or in equity or otherwise, of the Company of, in and to the property so
sold shall be divested and such sale shall be a perpetual bar both at law and in
equity against the Company, its successors and assigns, and against any and all
persons claiming or who may claim the property sold or any part thereof from,
through or under the Company; and
(f) the receipt of the Trustee or of the officer making such sale
shall be a sufficient discharge to the purchaser or purchasers at such sale for
his or their purchase money and such purchaser or purchasers and his or their
assigns or personal representatives shall not, after paying such purchase money
and receiving such receipt, be obliged to see to the application of such
purchase money, or be in anywise answerable for any loss, misapplication or
non-application thereof.
SECTION 10.06 Collection of Indebtedness and Suits for Enforcement by Trustee.
If an Event of Default described in clause (a) or (b) of Section
10.01 shall have occurred and be continuing, the Company shall, upon demand of
the Trustee, pay to it, for the benefit of the Holders of the Securities with
respect to which such Event of Default shall have
78
occurred, the whole amount then due and payable on such Securities for principal
and premium, if any, and interest, if any, and, in addition thereto, such
further amount as shall be sufficient to cover any amounts due to the Trustee
under Section 11.07.
If the Company shall fail to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, may prosecute such proceeding to judgment or final decree and may
enforce the same against the Company or any other obligor upon such Securities
and collect the moneys adjudged or decreed to be payable in the manner provided
by law out of the property of the Company or any other obligor upon such
Securities, wherever situated.
The Trustee shall, to the extent permitted by law, be entitled to
sue and recover judgment as aforesaid either before, during or after the
pendency of any proceedings for the enforcement of the Lien of this Indenture,
and in case of a sale of the Mortgaged Property or any part thereof and the
application of the proceeds of sale as aforesaid, the Trustee, in its own name
and as trustee of an express trust, shall be entitled to enforce payment of, and
to receive, all amounts then remaining due and unpaid upon the Securities then
Outstanding for principal, premium, if any, and interest, if any, for the
benefit of the Holders thereof, and shall be entitled to recover judgment for
any portion of the same remaining unpaid, with interest as aforesaid. No
recovery of any such judgment by the Trustee and no levy of any execution upon
any such judgment upon any of the Mortgaged Property or any other property of
the Company shall affect or impair the Lien of this Indenture upon the Mortgaged
Property or any part thereof or any rights, powers or remedies of the Trustee
hereunder, or any rights, powers or remedies of the Holders of the Securities.
SECTION 10.07 Application of Money Collected.
Any money collected by the Trustee pursuant to this Article,
including any rents, issues, profits, revenues and other income collected
pursuant to Section 10.03 (after the deductions therein provided) and any
proceeds of any sale (after deducting the costs and expenses of such sale,
including a reasonable compensation to the Trustee, its agents and counsel, and
any taxes, assessments or Liens prior to the Lien of this Indenture, except any
thereof subject to which such sale shall have been made), whether made under any
power of sale herein granted or pursuant to judicial proceedings, and any money
collected by the Trustee under Section 8.06, together with, in the case of an
entry or sale or as otherwise provided herein, any other sums then held by the
Trustee as part of the Mortgaged Property, shall be applied in the following
order, to the extent permitted by law, at the date or dates fixed by the Trustee
and, in case of the distribution of such money on account of principal or
premium, if any, or interest, if any, upon presentation of the Securities 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 11.07;
Second: To the payment of the whole amount then due and unpaid upon
the Outstanding Securities for principal and premium, if any, and
interest, if any, in respect of which or for the benefit of which such
money has been collected; and in case such
79
proceeds shall be insufficient to pay in full the whole amount so due and
unpaid upon such Securities, then to the payment of such principal and
interest, if any, thereon without any preference or priority, ratably
according to the aggregate amount so due and unpaid, with any balance then
remaining to the payment of premium, if any, and, if so specified as
contemplated by Section 3.01 with respect to the Securities of any series,
or any Tranche thereof, interest, if any, on overdue premium, if any, and
overdue interest, if any, ratably as aforesaid, all to the extent
permitted by applicable law; provided, however, that any money collected
by the Trustee pursuant to Section 8.06 in respect of interest or pursuant
to Section 10.03 shall first be applied to the payment of interest accrued
on the principal of Outstanding Securities; and
Third: To the payment of the remainder, if any, to the Company or to
whomsoever may be lawfully entitled to receive the same or as a court of
competent jurisdiction may direct.
SECTION 10.08 Receiver.
If an Event of Default shall have occurred and, during the
continuance thereof, the Trustee shall have commenced judicial proceedings to
enforce any right under this Indenture, the Trustee shall, to the extent
permitted by law, be entitled, as against the Company, without notice or demand
and without regard to the adequacy of the security for the Securities or the
solvency of the Company, to the appointment of a receiver of the Mortgaged
Property.
SECTION 10.09 Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise,
(a) to file and prove a claim for the whole amount of principal,
premium, if any, and interest, if any, owing and unpaid in respect of the
Securities and to file such other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee (including any claim for
amounts due to the Trustee under Section 11.07) and of the Holders allowed in
such judicial proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amounts due it under Section 11.07.
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Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
SECTION 10.10 Trustee May Enforce Claims without Possession of Securities.
All rights of action and claims under this Indenture or on the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities 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 in respect of which such judgment has been
recovered.
SECTION 10.11 Limitation on Suits.
No Holder 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:
(a) such Holder shall have previously given written notice to the
Trustee of a continuing Event of Default;
(b) the Holders of not less than a majority in aggregate principal
amount of the Securities then Outstanding 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;
(c) such Holder or Holders shall have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be incurred
in compliance with such request;
(d) the Trustee for sixty (60) days after its receipt of such
notice, request and offer of indemnity shall have failed to institute any such
proceeding; and
(e) no direction inconsistent with such written request shall have
been given to the Trustee during such sixty (60) day period by the Holders of a
majority in aggregate principal amount of the Securities then Outstanding;
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 Lien of the Indenture or
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.
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SECTION 10.12 Unconditional Right of Holders to Receive Principal, Premium and
Interest.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of and premium, if any, and (subject to Section
3.07) interest, if any, on such Security on the Stated Maturity or Maturities
expressed in such Security (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 10.13 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 shall have
been discontinued or abandoned for any reason, or shall have 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 such
Holder shall be restored severally and respectively to their former positions
hereunder and thereafter all rights and remedies of the Trustee and such Holder
shall continue as though no such proceeding had been instituted.
SECTION 10.14 Rights and Remedies Cumulative.
Except as otherwise provided in the last paragraph of Section 3.06,
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.
Anything in this Article to the contrary notwithstanding, the
availability of the remedies set forth herein (on an individual or cumulative
basis) and the procedures set forth herein relating to the exercise thereof
shall be subject to (a) the law (including, for purposes of this paragraph,
general principles of equity) of any jurisdiction wherein the Mortgaged Property
or any part thereof is located to the extent that such law is mandatorily
applicable and (b) the rights of the holder of any Lien prior to the Lien of
this Indenture, and, if and to the extent that any provision of this Article
conflicts with any provision of such applicable law and/or with the rights of
the holder of any such prior Lien, such provision of law and/or the rights of
such holder shall control.
SECTION 10.15 Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder 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.
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SECTION 10.16 Control by Holders of Securities.
If an Event of Default shall have occurred and be continuing, the
Holders of a majority in principal amount of the Securities then Outstanding
shall have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee; provided, however, that
(a) such direction shall not be in conflict with any rule of law or
with this Indenture, and could not involve the Trustee in personal liability in
circumstances where indemnity would not, in the Trustee's sole discretion, be
adequate, and
(b) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
SECTION 10.17 Waiver of Past Defaults.
Before any sale of any of the Mortgaged Property and before a
judgment or decree for payment of the money due shall have been obtained by the
Trustee as in this Article provided, the Holders of not less than a majority in
principal amount of the Securities then Outstanding may on behalf of the Holders
of all the Securities then Outstanding waive any past default hereunder and its
consequences, except a default
(a) in the payment of the principal of or premium, if any, or
interest, if any, on any Security Outstanding, or
(b) in respect of a covenant or provision hereof which under Section
14.02 cannot be modified or amended without the consent of the Holder of each
Outstanding Security of any series or Tranche affected.
Upon any such waiver, such default shall cease to exist, and any and
all Events 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 10.18 Undertaking for Costs.
The Company and the Trustee agree, and each Holder of Securities by
its acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, 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, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than ten percentum
(10%) in aggregate principal amount of the Securities then Outstanding, or to
any suit instituted by any Holder for the enforcement of the payment of the
principal of or premium, if any, or interest, if any, on any Security on or
after
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the Stated Maturity or Maturities expressed in such Security (or, in the case of
redemption, on or after the Redemption Date).
SECTION 10.19 Waiver of Appraisement and Other Laws.
To the full extent that it may lawfully so agree, the Company shall
not at any time set up, claim or otherwise seek to take the benefit or advantage
of any appraisement, valuation, stay, extension or redemption law, now or
hereafter in effect, in order to prevent or hinder the enforcement of this
Indenture or the absolute sale of the Mortgaged Property, or any part thereof,
or the possession thereof, or any part thereof, by any purchaser at any sale
under this Article; and the Company, for itself and all who may claim under it,
so far as it or they now or hereafter may lawfully do so, hereby waives the
benefit of all such laws. The Company, for itself and all who may claim under
it, waives, to the extent that it may lawfully do so, all right to have the
Mortgaged Property marshalled upon any foreclosure of the Lien hereof, and
agrees that any court having jurisdiction to foreclose the Lien of this
Indenture may order the sale of the Mortgaged Property as an entirety.
ARTICLE XI
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THE TRUSTEE
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SECTION 11.01 Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture; but in the case of any such certificates or
opinions which by any provisions hereof are specifically required to
be furnished to the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they conform to the
requirements of this Indenture.
(b) In case an Event of Default shall have occurred and be
continuing, the Trustee shall exercise such of the rights and powers vested in
it by this Indenture, and use the same degree of care and skill in their
exercise, as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that:
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(1) this subsection shall not be construed to limit the
effect of subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be
proved that the Trustee was negligent in ascertaining the pertinent
facts;
(3) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with
the direction of the Holders of a majority in principal amount of
the Outstanding Securities, as provided herein, relating to the
time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred
upon the Trustee, under this Indenture; and
(4) 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.
(d) 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.
SECTION 11.02 Notice of Defaults.
The Trustee shall give the Holders notice of any default hereunder
in the manner and to the extent required to do so by the Trust Indenture Act,
unless such default shall have been cured or waived; provided, however, that in
the case of any default of the character specified in Section 10.01(c), no such
notice to Holders shall be given until at least seventy-five (75) 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.
The Trustee shall give to the trustee under the SPPC 1940 Mortgage a
copy of each notice of default given to the Holders pursuant to this Section.
SECTION 11.03 Certain Rights of Trustee.
Subject to the provisions of Section 11.01 and to the applicable
provisions of the Trust Indenture Act:
(a) the Trustee may conclusively rely and shall be fully 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;
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(b) any request or direction of the Company mentioned herein shall
be sufficiently evidenced by a Company Request or Company Order, or as otherwise
expressly provided herein, and any resolution of the Board of Directors may be
sufficiently evidenced by a Board Resolution;
(c) 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
is specifically prescribed herein) may, in the absence of bad faith on its part,
conclusively rely upon an Officer's Certificate;
(d) the Trustee may consult with counsel 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;
(e) 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 Holder pursuant to this Indenture, unless such Holder 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;
(f) 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 (subject to
applicable legal requirements) be entitled to examine, during normal business
hours, the books, records and premises of the Company, personally or by agent or
attorney;
(g) 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;
(h) the Trustee shall not be charged with knowledge of any default
or Event of Default, as the case may be, unless either (i) a Responsible Officer
of the Trustee shall have actual knowledge of the default or Event of Default,
as the case may be, or (ii) written notice of such default or Event of Default,
as the case may be, shall have been received by the Trustee at the Corporate
Trust Office of the Trustee from the Company, any other obligor on the
Securities or from any Holder of such Securities or, in the case of an Event of
Default described in Section 10.01(f), from the trustee under the SPPC 1940
Mortgage and any such notice references the Securities or this Indenture;
(i) the rights, privileges, protections, immunities and benefits
given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder, and to each agent, custodian and other Person
employed to act hereunder;
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(j) the Trustee shall not be liable for any action taken, suffered
or omitted to be taken by it in good faith and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon it by
this Indenture; and
(k) the Trustee shall not be personally liable, in case of entry by
it upon the Mortgaged Property, for debts contracted or liabilities or damages
incurred in the management or operation of the Mortgaged Property.
SECTION 11.04 Not Responsible for Recitals or Issuance of Securities or
Application of Proceeds.
The recitals contained herein and in the Securities (except the
Trustee's certificate of authentication on the Securities) 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 value or condition of the Mortgaged Property or any
part thereof, or as to the title of the Company thereto or as to the security
afforded thereby or hereby, or as to the validity or genuineness of any
securities at any time pledged and deposited with the Trustee hereunder, or as
to the validity or sufficiency of this Indenture or of the Securities. The
Trustee shall not be accountable for the use or application by the Company of
the Securities or the proceeds thereof or of any money paid to the Company or
upon Company Order under any provision hereof. Neither the Trustee nor any
Authenticating Agent shall be accountable for the use or application by the
Company of Securities or the proceeds thereof. The Trustee shall have no
responsibility to make or to see to the making of any recording, filing or
registration of any instrument or notice (including any financing or
continuation statement or any tax or securities form) (or any rerecording,
refiling or reregistration of any thereof); at any time in any public office or
elsewhere for the purpose of perfecting, maintaining the perfection of or
otherwise making effective the Lien of this Indenture or for any other purpose
and shall have no responsibility for seeing to the insurance on the Mortgaged
Property or for paying any taxes relating to the Mortgaged Property or for
otherwise maintaining the Mortgaged Property, including, but not limited to,
attending to any environmental matters in respect thereof or disposing of any
hazardous or other wastes located thereon.
SECTION 11.05 May Hold Securities.
Each of the Trustee, any Authenticating Agent, any Paying Agent, any
Security Registrar or any other agent of the Company or the Trustee, in its
individual or any other capacity, may become the owner or pledgee of Securities
and, subject to Sections 11.08 and 11.13, may otherwise deal with the Company
with the same rights it would have if it were not such Trustee, Authenticating
Agent, Paying Agent, Security Registrar or other agent.
SECTION 11.06 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 or investment of any money received by it
hereunder except as expressly provided herein or otherwise agreed with, and for
the sole benefit of, the Company.
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SECTION 11.07 Compensation and Reimbursement.
The Company shall
(a) pay to the Trustee from time to time reasonable compensation 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);
(b) except as otherwise expressly provided herein, 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 to the extent that any such
expense, disbursement or advance may be attributable to its negligence, willful
misconduct or bad faith; and
(c) indemnify the Trustee and hold it harmless from and against any
loss, liability or expense incurred without negligence, willful misconduct or
bad faith on its part, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder or the exercise or performance
of its duties 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.
As security for the performance of the obligations of the Company
under this Section, the Trustee shall have a Lien secured by this Indenture
prior to the Securities upon the Mortgaged Property and upon all other property
and funds held or collected by the Trustee as such, other than property and
funds held in trust under Section 9.03 (except moneys payable to the Company as
provided in Section 9.03). "Trustee" for purposes of this Section shall include
any predecessor Trustee; provided, however, that the negligence, willful
misconduct or bad faith of any Trustee hereunder shall not affect the rights of
any other Trustee hereunder.
In addition and without prejudice to the rights provided to the
Trustee under any of the provisions of this Indenture, when the Trustee incurs
expenses or renders services in connection with an Event of Default specified in
Section 10.01(e) or Section 10.01(f), 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 11.07 shall survive the termination
of this Indenture and the resignation or removal of the Trustee.
SECTION 11.08 Disqualification; Conflicting Interests.
If the Trustee shall have or acquire any conflicting interest within
the meaning of the Trust Indenture Act, it shall either eliminate such
conflicting interest or resign to the extent, in the manner and with the effect,
and subject to the conditions, provided in the Trust Indenture Act and this
Indenture. For purposes of Section 310(b)(1) of the Trust Indenture Act and to
the extent permitted thereby, the Trustee, in its capacity as trustee in respect
of the Securities of any
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series, shall not be deemed to have a conflicting interest arising from its
capacity as trustee in respect of the Securities of any other series.
SECTION 11.09 Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be
(A) a corporation organized and doing business under the
laws of the United States, any State or Territory thereof or the
District of Columbia, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at
least Fifty Million Dollars ($50,000,000) and subject to supervision
or examination by Federal or State authority, or
(B) if and to the extent permitted by the Commission by
rule, regulation or order upon application, a corporation or other
Person organized and doing business under the laws of a foreign
government, authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least Fifty
Million Dollars ($50,000,000) or the Dollar equivalent of the
applicable foreign currency and subject to supervision or
examination by authority of such foreign government or a political
subdivision thereof substantially equivalent to supervision or
examination applicable to United States institutional trustees,
and, in either case, qualified and eligible under this Article and the Trust
Indenture Act. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of such supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article.
SECTION 11.10 Resignation and Removal; Appointment of Successor.
(a) 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 11.11.
(b) The Trustee may resign at any time by giving written notice
thereof to the Company. If the instrument of acceptance by a successor Trustee
required by Section 11.11 shall not have been delivered to the Trustee within
thirty (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.
(c) The Trustee may be removed at any time by Act of the Holders of
a majority in principal amount of the Securities then Outstanding delivered to
the Trustee and to the Company.
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(d) If at any time:
(i) the Trustee shall fail to comply with Section 11.08 after
written request therefor by the Company or by any Holder who has been a
bona fide Holder for at least six months, or
(ii) the Trustee shall cease to be eligible under Section
11.09 and shall fail to resign after written request therefor by the
Company or by any such Holder, or
(iii) 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, (x) the Company by a Board Resolution may remove the
Trustee or (y) subject to Section 10.18, any Holder who has been a bona fide
Holder for at least six (6) months may, on behalf of itself and all others
similarly situated, petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee or Trustees.
(e) 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
(other than as contemplated in clause (y) in subsection (d) of this Section),
the Company, by a Board Resolution, shall take prompt steps to appoint a
successor Trustee or Trustees and shall comply with the applicable requirements
of Section 11.11. If, within one (1) year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Trustee shall be
appointed by Act of the Holders of a majority in principal amount of the
Securities then Outstanding 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 11.11,
become the successor Trustee and to that extent supersede the successor Trustee
appointed by the Company. If no successor Trustee shall have been so appointed
by the Company or the Holders and accepted appointment in the manner required by
Section 11.11, any Holder who has been a bona fide Holder of a Security for at
least six (6) months may, on behalf of itself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
(f) So long as no event which is, or after notice or lapse of time,
or both, would become, an Event of Default shall have occurred and be
continuing, if the Company shall have delivered to the Trustee (i) a Board
Resolution appointing a successor Trustee, effective as of a date specified
therein, and (ii) an instrument of acceptance of such appointment, effective as
of such date, by such successor Trustee in accordance with Section 11.11, the
Trustee shall be deemed to have resigned as contemplated in subsection (b) of
this Section, the successor Trustee shall be deemed to have been appointed
pursuant to subsection (e) of this Section and such appointment shall be deemed
to have been accepted as contemplated in Section 11.11, all as of such date, and
all other provisions of this Section and Section 11.11 shall be applicable to
such resignation, appointment and acceptance except to the extent inconsistent
with this subsection (f).
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(g) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee by mailing
written notice of such event by first-class mail, postage prepaid, to all
Holders as their names and addresses appear in the Security Register. Each
notice shall include the name of the successor Trustee and the address of its
corporate trust office.
SECTION 11.11 Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Trustee,
every such successor Trustee so appointed shall execute, acknowledge and deliver
to the 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; but, on the request of the Company or the
successor Trustee, such retiring Trustee shall, upon payment of all sums owed to
it, 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, subject nevertheless to its Lien provided for
in Section 11.07.
(b) Upon request of any such successor Trustee, the Company shall
execute any instruments which fully vest in and confirm to such successor
Trustee all rights, powers and trusts referred to in subsection (a) of this
Section.
(c) No successor Trustee shall accept its appointment unless at the
time of such acceptance such successor Trustee shall be qualified and eligible
under this Article.
SECTION 11.12 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 Securities 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 Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
SECTION 11.13 Preferential Collection of Claims against Company.
If the Trustee shall be or become a creditor of the Company or any
other obligor upon the Securities (other than by reason of a relationship
described in Section 311(b) of the Trust Indenture Act), the Trustee shall be
subject to any and all applicable provisions of the Trust Indenture Act
regarding the collection of claims against the Company or such other obligor.
For purposes of Section 3.11(b) of the Trust Indenture Act:
(A) the term "cash transaction" means any transaction in
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which full payment for goods or securities sold is made within seven
days after delivery of the goods or securities in currency or in
checks or other orders drawn upon banks or bankers and payable upon
demand; and
(B) the term "self-liquidating paper" means any draft,
bill of exchange, acceptance or obligation which is made, drawn,
negotiated or incurred by the Company or such obligor for the
purpose of financing the purchase, processing, manufacturing,
shipment, storage or sale of goods, wares or merchandise and which
is secured by documents evidencing title to, possession of, or a
lien upon, the goods, wares or merchandise or the receivables or
proceeds arising from the sale of the goods, wares or merchandise
previously constituting the security, provided the security is
received by the Trustee simultaneously with the creation of the
creditor relationship with the Company or such obligor arising from
the making, drawing, negotiating or incurring of the draft, bill of
exchange, acceptance or obligation.
SECTION 11.14 Co-trustees and Separate Trustees.
At any time or times, for the purpose of meeting the legal
requirements of any jurisdiction in which any of the Mortgaged Property may at
the time be located, the Company and the Trustee shall have power to appoint,
and, upon the written request of the Trustee or of the Holders of at least
thirty-three percentum (33%) in principal amount of the Securities then
Outstanding, the Company shall for such purpose join with the Trustee in the
execution and delivery of all instruments and agreements necessary or proper to
appoint, one or more Persons approved by the Trustee and, if no Event of Default
shall have occurred and be continuing, by the Company either to act as
co-trustee, jointly with the Trustee, of all or any part of the Mortgaged
Property, or to act as separate trustee of any such property, in either case
with such powers as may be provided in the instrument of appointment, and to
vest in such Person or Persons, in the capacity aforesaid, any property, title,
right or power deemed necessary or desirable, subject to the other provisions of
this Section. If the Company does not join in such appointment within fifteen
(15) days after the receipt by it of a request so to do, or if an Event of
Default shall have occurred and be continuing, the Trustee alone shall have
power to make such appointment.
Should any written instrument or instruments from the Company be
required by any co-trustee or separate trustee so appointed to more fully
confirm to such co-trustee or separate trustee such property, title, right or
power, any and all such instruments shall, on request, be executed, acknowledged
and delivered by the Company.
Every co-trustee or separate trustee shall, to the extent permitted
by law, but to such extent only, be appointed subject to the following
conditions:
(A) the Securities shall be authenticated and delivered,
and all rights, powers, duties and obligations hereunder in respect
of the custody of securities, cash and other personal property held
by, or required to be deposited or pledged with, the Trustee
hereunder, shall be exercised solely, by the Trustee;
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(B) the rights, powers, duties and obligations hereby
conferred or imposed upon the Trustee in respect of any property
covered by such appointment shall be conferred or imposed upon and
exercised or performed either by the Trustee or by the Trustee and
such co-trustee or separate trustee jointly, as shall be provided in
the instrument appointing such co-trustee or separate trustee,
except to the extent that under any law of any jurisdiction in which
any particular act is to be performed the Trustee shall be
incompetent or unqualified to perform such act, in which event such
rights, powers, duties and obligations shall be exercised and
performed by such co-trustee or separate trustee;
(C) the Trustee at any time, by an instrument in writing
executed by it, with the concurrence of the Company, may accept the
resignation of or remove any co-trustee or separate trustee
appointed under this Section, and, if an Event of Default shall have
occurred and be continuing, the Trustee shall have power to accept
the resignation of, or remove, any such co-trustee or separate
trustee without the concurrence of the Company. Upon the written
request of the Trustee, the Company shall join with the Trustee in
the execution and delivery of all instruments and agreements
necessary or proper to effectuate such resignation or removal. A
successor to any co-trustee or separate trustee so resigned or
removed may be appointed in the manner provided in this Section;
(D) neither the Trustee nor any co-trustee or separate
trustee hereunder shall be personally liable by reason of any act or
omission of any other trustee hereunder; and
(E) any Act of Holders delivered to the Trustee shall be
deemed to have been delivered to each such co-trustee and separate
trustee.
SECTION 11.15 Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with
respect to the Securities of one or more series, or any Tranche thereof, which
shall be authorized to act on behalf of the Trustee to authenticate Securities
of such series or Tranche issued upon original issuance, exchange, registration
of transfer or partial redemption thereof or pursuant to Section 3.06, and
Securities 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 Securities 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, any State or Territory thereof or the
District of Columbia or the Commonwealth of Puerto Rico, authorized under such
laws to act as Authenticating Agent, having a combined capital and surplus of
not less than Fifty Million Dollars ($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
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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 all or substantially all of
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. Any successor Authenticating
Agent upon acceptance of its appointment hereunder shall become vested with all
the rights, powers and duties of its 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.
The provisions of Sections 3.08, 11.04 and 11.05 shall be applicable
to each Authenticating Agent.
If an appointment with respect to the Securities of one or more
series, or any Tranche thereof, shall be made pursuant to this Section, the
Securities of such series or Tranche may have endorsed thereon, in addition to
the Trustee's certificate of authentication, an alternate certificate of
authentication substantially in the following form:
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This is one of the Securities 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
If all of the Securities of a series may not be originally issued at
one time, and if the Trustee does not have an office capable of authenticating
Securities upon original issuance located in a Place of Payment where the
Company wishes to have Securities of such series authenticated upon original
issuance, the Trustee, if so requested by the Company in writing (which writing
need not comply with Section 1.04 and need not be accompanied by an Opinion of
Counsel), shall appoint, in accordance with this Section and in accordance with
such procedures as shall be acceptable to the Trustee, an Authenticating Agent
having an office in a Place of Payment designated by the Company with respect to
such series of Securities.
ARTICLE XII
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LISTS OF HOLDERS; REPORTS BY TRUSTEE AND COMPANY
------------------------------------------------
SECTION 12.01 Lists of Holders.
Semiannually, not later than June 30 and December 31 in each year,
commencing December 31, 2001, and at such other times as the Trustee may request
in writing, the Company shall furnish or cause to be furnished to the Trustee
information as to the names and addresses of the Holders as of a date no more
than fifteen (15) days prior to the date such information is so furnished, and
the Trustee shall preserve such information and similar information received by
it in any other capacity and afford to the Holders access to information so
preserved by it, all to such extent, if any, and in such manner as shall be
required by the Trust Indenture Act; provided, however, that no such list need
be furnished so long as the Trustee shall be the Security Registrar.
SECTION 12.02 Reports by Trustee and Company.
Not later than July 15 in each year, commencing July 15, 2002, the
Trustee shall transmit to the Holders, the Commission and each securities
exchange upon which any Securities are listed a report, dated as of the next
preceding May 15, with respect to any events and other matters described in
Section 313(a) of the Trust Indenture Act, in such manner and to the extent
required by the Trust Indenture Act. The Trustee shall transmit to the Holders,
the Commission and each securities exchange upon which any Securities are
listed, and the Company shall file with the Trustee (within thirty (30) days
after filing with the Commission in the case of reports
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which pursuant to the Trust Indenture Act must be filed with the Commission and
furnished to the Trustee) and transmit to the Holders, such other information,
reports and other documents, if any, at such times and in such manner, as shall
be required by the Trust Indenture Act. Delivery of such reports, information
and documents to the Trustee is for informational purposes only and the
Trustee's receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Company's compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on Officers'
Certificates). The Company shall notify the Trustee of the listing of any
Securities on any securities exchange.
ARTICLE XIII
------------
CONSOLIDATION, MERGER, CONVEYANCE
---------------------------------
OR OTHER TRANSFER
-----------------
SECTION 13.01 Company May Consolidate, etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other
corporation, or convey or otherwise transfer, or lease, subject to the Lien of
this Indenture, all of the Mortgaged Property as or substantially as an entirety
to any Person, unless:
(a) the corporation formed by such consolidation or into which the
Company is merged or the Person which acquires by conveyance or other transfer,
or which leases, the Mortgaged Property as or substantially as an entirety shall
be a corporation organized and existing under the laws of the United States, any
State or Territory thereof or the District of Columbia (such corporation being
hereinafter sometimes called the "Successor Corporation") and shall execute and
deliver to the Trustee an indenture supplemental hereto, in form recordable and
reasonably satisfactory to the Trustee, which:
(i) in the case of a consolidation, merger, conveyance or
other transfer, or in the case of a lease if the term thereof extends
beyond the last Stated Maturity of the Securities then Outstanding,
contains an assumption by the Successor Corporation of the due and
punctual payment of the principal of and premium, if any, and interest, if
any, on all the Securities then Outstanding and the performance and
observance of every covenant and condition of this Indenture to be
performed or observed by the Company, and
(ii) in the case of a consolidation, merger, conveyance or
other transfer, contains a grant, conveyance, transfer and mortgage by the
Successor Corporation, of the same tenor of the Granting Clauses herein,
(A) confirming the Lien of this Indenture on the
Mortgaged Property (as constituted immediately prior to the time
such transaction became effective) and subjecting to the Lien of
this Indenture all property, real, personal and mixed, thereafter
acquired by the Successor Corporation which shall constitute an
improvement, extension or addition to the Mortgaged Property (as so
constituted) or a renewal, replacement or substitution of or for any
part thereof,
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and, at the election of the Successor Corporation,
(B) subjecting to the Lien of this Indenture such
property, real, personal or mixed, in addition to the property
described in subclause (A) above, then owned or thereafter acquired
by the Successor Corporation as the Successor Corporation shall, in
its sole discretion, specify or describe therein,
and the Lien confirmed or created by such grant, conveyance, transfer and
mortgage shall have force, effect and standing similar to those which the
Lien of this Indenture would have had if the Company had not been a party
to such consolidation, merger, conveyance or other transfer and had
itself, after the time such transaction became effective, purchased,
constructed or otherwise acquired the property subject to such grant,
conveyance, transfer and mortgage;
(b) in the case of a lease, such lease shall be made expressly
subject to termination by the Company or by the Trustee at any time during the
continuance of an Event of Default, and also by the purchaser of the property so
leased at any sale thereof hereunder, whether such sale be made under the power
of sale hereby conferred or pursuant to judicial proceedings; and
(c) the Company shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel each of which shall state that such
consolidation, merger, conveyance or other transfer or lease, and such
supplemental indenture, comply with this Article and that all conditions
precedent herein provided for relating to such transaction have been complied
with.
As used in this Article and in Section 8.09(d), the terms
"improvement", "extension" and "addition" shall be limited to (a) with respect
to real property subject to the Lien of this Indenture, any item of personal
property which has been so affixed or attached to such real property as to be
regarded a part of such real property under applicable law and (b) with respect
to personal property subject to the Lien of this Indenture, any improvement,
extension or addition to such personal property which (i) is made to maintain,
renew, repair or improve the function of such personal property and (ii) is
physically installed in or affixed to such personal property.
SECTION 13.02 Successor Corporation Substituted.
Upon any consolidation or merger or any conveyance or other
transfer, subject to the Lien of this Indenture, of all of the Mortgaged
Property as or substantially as an entirety in accordance with Section 13.01,
the Successor Corporation shall succeed to, and be substituted for, and may
exercise every power and right of, the Company under this Indenture with the
same effect as if such Successor Corporation had been named as the "Company"
herein. Without limiting the generality of the foregoing:
(a) all property of the Successor Corporation then subject to the
Lien of this Indenture, of the character described in Section 1.03, shall
constitute Property Additions;
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(b) the Successor Corporation may execute and deliver to the
Trustee, and thereupon the Trustee shall, subject to the provisions of Article
IV, authenticate and deliver, Securities upon any basis provided in Article IV;
and
(c) the Successor Corporation may, subject to the applicable
provisions of this Indenture, cause Property Additions to be applied to any
other Authorized Purpose.
All Securities so executed by the Successor Corporation, and authenticated and
delivered by the Trustee, shall in all respects be entitled to the benefit of
the Lien of this Indenture equally and ratably with all Securities executed,
authenticated and delivered prior to the time such consolidation, merger,
conveyance or other transfer became effective.
SECTION 13.03 Extent of Lien Hereof on Property of Successor Corporation.
Unless, in the case of a consolidation, merger, conveyance or other
transfer contemplated by Section 13.01, the indenture supplemental hereto
contemplated in clause (b)(ii) in Section 13.01, or any other indenture,
contains a grant, conveyance, transfer and mortgage by the Successor Corporation
as described in subclause (B) thereof, neither this Indenture nor such
supplemental indenture shall become or be, or be required to become or be, a
Lien upon any of the properties:
(a) owned by the Successor Corporation or any other party to such
transaction (other than the Company) immediately prior to the time of
effectiveness of such transaction or
(b) acquired by the Successor Corporation at or after the time of
effectiveness of such transaction,
except, in either case, properties acquired from the Company in or as a result
of such transaction and improvements, extensions and additions to such
properties and renewals, replacements and substitutions of or for any part or
parts thereof.
SECTION 13.04 Release of Company upon Conveyance or Other Transfer.
In the case of a conveyance or other transfer to any Person or
Persons as contemplated in Section 13.01, upon the satisfaction of all the
conditions specified in Section 13.01, the Company (such term being used in this
Section without giving effect to such transaction) shall be released and
discharged from all obligations and covenants under this Indenture and on and
under all Securities then Outstanding (unless the Company shall have delivered
to the Trustee an instrument in which it shall waive such release and discharge)
and the Trustee shall acknowledge in writing that the Company has been so
released and discharged.
SECTION 13.05 Merger into Company; Extent of Lien Hereof.
(a) Nothing in this Indenture shall be deemed to prevent or restrict
any consolidation or merger after the consummation of which the Company would be
the surviving or resulting corporation or any conveyance or other transfer, or
lease, subject to the Lien of this Indenture, of any part of the Mortgaged
Property which does not constitute the entirety, or substantially the entirety,
thereof.
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(b) Unless, in the case of a consolidation or merger described in
subsection (a) of this Section, an indenture supplemental hereto shall otherwise
provide, this Indenture shall not become or be, or be required to become or be,
a Lien upon any of the properties acquired by the Company in or as a result of
such transaction or any improvements, extensions or additions to such properties
or any renewals, replacements or substitutions of or for any part or parts
thereof.
ARTICLE XIV
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SUPPLEMENTAL INDENTURES
-----------------------
SECTION 14.01 Supplemental Indentures without Consent of Holders.
Without the consent of any Holders, the Company and the Trustee, at
any time and from time to time, may enter into one or more indentures
supplemental hereto, in form reasonably satisfactory to the Trustee, for any of
the following purposes:
(a) 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 Securities, all as provided in Article XIII; or
(b) to add one or more covenants of the Company or other provisions
for the benefit of all Holders or for the benefit of the Holders of, or to
remain in effect only so long as there shall be Outstanding, Securities of one
or more specified series, or one or more specified Tranches thereof; or to
surrender any right or power herein conferred upon the Company; or
(c) to correct or amplify the description of any property at any
time subject to the Lien of this Indenture; or better to assure, convey and
confirm unto the Trustee any property subject or required to be subjected to the
Lien of this Indenture; or to subject to the Lien of this Indenture additional
property (including property of Persons other than the Company), to specify any
additional Permitted Liens with respect to such additional property and to
modify Section 8.02 in order to specify therein any additional items with
respect to such additional property; or
(d) to change or eliminate any provision of this Indenture or to add
any new provision to this Indenture; provided, however, that if such change,
elimination or addition shall adversely affect the interests of the Holders of
Securities of any series or Tranche in any material respect, such change,
elimination or addition shall become effective with respect to such series or
Tranche only when no Security of such series or Tranche remains Outstanding; or
(e) to establish the form or terms of Securities of any series or
Tranche as contemplated by Sections 2.01 and 3.01; or
(f) to provide for the authentication and delivery of bearer
Securities and coupons appertaining thereto representing interest, if any,
thereon and for the procedures for the registration, exchange and replacement
thereof and for the giving of notice to, and the solicitation of the vote or
consent of, the holders thereof, and for any and all other matters incidental
thereto; or
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(g) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee or by a co-trustee or separate trustee; or
(h) to provide for the procedures required to permit the Company to
utilize, at its option, a non-certificated system of registration for all, or
any series or Tranche of, the Securities; or
(i) to change any place or places where (1) the principal of and
premium, if any, and interest, if any, on all or any series of Securities, or
any Tranche thereof, shall be payable, (2) all or any series of Securities, or
any Tranche thereof, may be surrendered for registration of transfer, (3) all or
any series of Securities, or any Tranche thereof, may be surrendered for
exchange and (4) notices and demands to or upon the Company in respect of all or
any series of Securities, or any Tranche thereof, and this Indenture may be
served; or
(j) 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 additions to, deletions from or other changes to the
provisions under this Indenture, provided that such additions, deletions and/or
other changes shall not adversely affect the interests of the Holders of
Securities of any series or Tranche in any material respect; or
(k) to modify, eliminate or add to the provisions of this Indenture
to such extent as shall be necessary to effect the qualification of this
Indenture under the Trust Indenture Act, or under any similar federal statute
hereafter enacted, and to add to this Indenture such other provisions as may be
expressly permitted by the Trust Indenture Act, excluding, however the
provisions referred to in Section 316(a)(2) of the Trust Indenture Act as in
effect at the date as of which this instrument was executed or any corresponding
provision in any similar federal statute hereafter enacted.
Without limiting the generality of the foregoing, if the Trust
Indenture Act as in effect at the date of the execution and delivery of this
Indenture, as originally executed and delivered, or at any time thereafter shall
be amended and
(x) if any such amendment shall require one or more changes to
any provisions hereof or the inclusion herein of any additional
provisions, or shall by operation of law be deemed to effect such changes
or incorporate such provisions by reference or otherwise, this Indenture
shall be deemed to have been amended so as to conform to such amendment to
the Trust Indenture Act, and the Company and the Trustee may, without the
consent of any Holders, enter into an indenture supplemental hereto to
evidence such amendment hereof; or
(y) if any such amendment shall permit one or more changes to,
or the elimination of, any provisions hereof which, at the date of the
execution and delivery hereof or at any time thereafter, are required by
the Trust Indenture Act to be contained herein or are contained herein to
reflect any provisions of the Trust Indenture Act as in effect at such
date, this Indenture shall be deemed to have been amended to effect such
changes or elimination, and the Company and the Trustee may, without the
consent of
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any Holders, enter into an indenture supplemental hereto to amend this
Indenture to effect such changes or elimination.
SECTION 14.02 Supplemental Indentures with Consent of Holders.
Subject to the provisions of Section 14.01, with the consent of the
Holders of not less than a majority in aggregate principal amount of the
Securities of all series then Outstanding under this Indenture, considered as
one class, by Act of said Holders delivered to the Company and the Trustee, the
Company 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; provided, however, that if
there shall be Securities of more than one series Outstanding hereunder and if a
proposed supplemental indenture shall directly affect the rights of the Holders
of Securities of one or more, but less than all, of such series, then the
consent only of the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all series so directly affected, considered as one
class, shall be required; and provided, further, that if the Securities of any
series shall have been issued in more than one Tranche and if a proposed
supplemental indenture shall directly affect the rights of the Holders of
Securities of one or more, but less than all, of such Tranches, then the consent
only of the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected, considered as one
class, shall be required; and provided, further, that no such supplemental
indenture shall:
(a) change the Stated Maturity of the principal of, or any
installment of principal of or interest on, any Security, or reduce the
principal amount thereof or the rate of interest thereon (or the amount of any
installment of interest thereon) or change the method of calculating such rate
or reduce any premium payable thereon, or reduce the amount of the principal of
any Discount Security that would be due and payable upon a declaration of
acceleration of the Maturity thereof pursuant to Section 10.02, or change the
coin or currency (or other property), in which any Security or premium, if any,
or interest, if any, thereon is payable, or impair the right to institute suit
for the enforcement of any such payment on or after the Maturity of any
Security, without, in any such case, the consent of the Holder of such Security;
or
(b) permit the creation of any Lien (not otherwise permitted hereby)
ranking prior to the Lien of this Indenture with respect to all or substantially
all of the Mortgaged Property, or (except by virtue of a supplemental indenture
described in clause (j) in Section 14.01) terminate the Lien of this Indenture
on all or substantially all of the Mortgaged Property or deprive the Holders of
the benefit of the Lien of this Indenture, without, in any such case, the
consent of the Holders of all Securities then Outstanding; or
(c) reduce the percentage in principal amount of the Outstanding
Securities of any series, or any Tranche thereof, the consent of the Holders of
which is required for any such supplemental indenture, or the consent of the
Holders of which is required for any waiver of compliance with any provision of
this Indenture or of any default hereunder and its consequences, or reduce the
requirements of Section 15.04 for quorum or voting, without, in any such case,
the consent of the Holder of each Outstanding Security of such series or
Tranche; or
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(d) modify any of the provisions of this Section, Section 6.09 or
Section 10.17 with respect to the Securities of any series or any Tranche
thereof (except to increase the percentages in principal amount referred to in
this Section or such other Sections or to provide that other provisions of this
Indenture cannot be modified or waived without the consent of the Holders of all
Securities of such series or Tranche) without, in any such case, the consent of
the Holder of each Outstanding Security of such series or Tranche; 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, or the deletion of this proviso, in
accordance with the requirements of Section 14.01(g).
A supplemental indenture which (x) changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of the Holders of, or which is to remain in effect only so long as there
shall be Outstanding, Securities of one or more specified series, or one or more
Tranches thereof, or (y) modifies the rights of the Holders of Securities of
such series or Tranches with respect to such covenant or other provision, shall
be deemed not to affect the rights under this Indenture of the Holders of
Securities of any other series or Tranche.
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 14.03 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 11.01) 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, immunities or liabilities under this Indenture or
otherwise.
SECTION 14.04 Effect of Supplemental Indentures.
Upon the execution and delivery 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 Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby. Any supplemental indenture permitted by this
Article may restate this Indenture in its entirety, and, upon the execution and
delivery thereof, any such restatement shall supersede this Indenture as
theretofore in effect for all purposes.
SECTION 14.05 Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
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SECTION 14.06 Reference in Securities to Supplemental Indentures.
Securities of any series, or any Tranche thereof, 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 Securities of any series, or
any Tranche thereof, 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 Securities of such series or Tranche.
SECTION 14.07 Modification Without Supplemental Indenture.
To the extent, if any, that the terms of any particular series of
Securities shall have been established in or pursuant to a Board Resolution or
an Officer's Certificate pursuant to a supplemental indenture or a Board
Resolution as contemplated by Section 3.01, and not in a supplemental indenture,
additions to, changes in or the elimination of any of such terms may be effected
by means of a supplemental Board Resolution or a supplemental Officer's
Certificate, as the case may be, delivered to, and accepted by, the Trustee;
provided, however, that such supplemental Board Resolution or supplemental
Officer's Certificate shall not be accepted by the Trustee or otherwise be
effective unless all conditions set forth in this Indenture which would be
required to be satisfied if such additions, changes or elimination were
contained in a supplemental indenture shall have been appropriately satisfied.
Upon the acceptance thereof by the Trustee, any such supplemental Board
Resolution or supplemental Officer's Certificate shall be deemed to be a
"supplemental indenture" for purposes of Section 14.04 and 14.06 and a
"supplemental indenture", "indenture supplemental" to this Indenture or
"instrument" supplemental to this Indenture for purposes of Section 6.08.
ARTICLE XV
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MEETINGS OF HOLDERS; ACTION WITHOUT MEETING
-------------------------------------------
SECTION 15.01 Purposes for Which Meetings May Be Called.
A meeting of Holders of Securities of one or more, or all, series,
or any Tranche or Tranches thereof, may be called at any time and from time to
time pursuant to this Article to make, give or take any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be made, given or taken by Holders of Securities of such
series or Tranches.
SECTION 15.02 Call, Notice and Place of Meetings.
(a) The Trustee may at any time call a meeting of Holders of
Securities of one or more, or all, series, or any Tranche or Tranches thereof,
for any purpose specified in Section 15.01, to be held at such time and (except
as provided in subsection (b) of this Section) at such place in the Borough of
Manhattan, the City of New York, as the Trustee shall determine, or, with the
approval of the Company, at any other place. Notice of every such meeting,
setting
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forth the time and the place of such meeting and in general terms the action
proposed to be taken at such meeting, shall be given, in the manner provided in
Section 1.08, not less than twenty-one (21) nor more than one hundred eighty
(180) days prior to the date fixed for the meeting.
(b) The Trustee may be asked to call a meeting of the Holders of
Securities of one or more, or all, series, or any Tranche or Tranches thereof,
by the Company or by the Holders of thirty-three percentum (33%) in aggregate
principal amount of all of such series and Tranches, considered as one class,
for any purpose specified in Section 15.01, by written request setting forth in
reasonable detail the action proposed to be taken at the meeting. If the Trustee
shall have been asked by the Company to call such a meeting, the Company shall
determine the time and place for such meeting and may call such meeting by
giving notice thereof in the manner provided in subsection (a) of this Section,
or shall direct the Trustee, in the name and at the expense of the Company, to
give such notice. If the Trustee shall have been asked to call such a meeting by
Holders in accordance with this subsection (b), and the Trustee shall not have
given the notice of such meeting within twenty-one (21) days after receipt of
such request or shall not thereafter proceed to cause the meeting to be held as
provided herein, then the Holders of Securities of such series and Tranches, in
the principal amount above specified, may determine the time and the place in
the Borough of Manhattan, The City of New York, or in such other place as shall
be determined or approved by the Company, for such meeting and may call such
meeting for such purposes by giving notice thereof as provided in subsection (a)
of this Section.
(c) Any meeting of Holders of Securities of one or more, or all,
series, or any Tranche or Tranches thereof, shall be valid without notice if the
Holders of all Outstanding Securities of such series or Tranches are present in
person or by proxy and if representatives of the Company and the Trustee are
present, or if notice is waived in writing before or after the meeting by the
Holders of all Outstanding Securities of such series, or any Tranche or Tranches
thereof, or by such of them as are not present at the meeting in person or by
proxy, and by the Company and the Trustee.
SECTION 15.03 Persons Entitled to Vote at Meetings.
To be entitled to vote at any meeting of Holders of Securities of
one or more, or all, series, or any Tranche or Tranches thereof, a Person shall
be (a) a Holder of one or more Outstanding Securities of such series or Tranches
or (b) a Person appointed by an instrument in writing as proxy for a Holder or
Holders of one or more Outstanding Securities of such series or Tranches by such
Holder or Holders. The only Persons who shall be entitled to attend any meeting
of Holders of Securities of any series or Tranche shall be the Persons entitled
to vote at such meeting and their counsel, any representatives of the Trustee
and its counsel and any representatives of the Company and its counsel.
SECTION 15.04 Quorum; Action.
The Persons entitled to vote a majority in aggregate principal
amount of the Outstanding Securities of the series and Tranches with respect to
which a meeting shall have been called as hereinbefore provided, considered as
one class, shall constitute a quorum for a meeting of Holders of Securities of
such series and Tranches; provided, however, that if any
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action is to be taken at such meeting which this Indenture expressly provides
may be taken by the Holders of a specified percentage, which is less than a
majority, in principal amount of the Outstanding Securities of such series and
Tranches, considered as one class, the Persons entitled to vote such specified
percentage in principal amount of the Outstanding Securities of such series and
Tranches, considered as one class, shall constitute a quorum. In the absence of
a quorum within one hour of the time appointed for any such meeting, the meeting
shall, if convened at the request of Holders of Securities of such series and
Tranches, be dissolved. In any other case the meeting may be adjourned for such
period as may be determined by the chairman of the meeting prior to the
adjournment of such meeting. In the absence of a quorum at any such adjourned
meeting, such adjourned meeting may be further adjourned for such period as may
be determined by the chairman of the meeting prior to the adjournment of such
adjourned meeting. Except as provided by Section 15.05(e), notice of the
reconvening of any meeting adjourned for more than thirty (30) days shall be
given as provided in Section 1.08 not less than ten (10) days prior to the date
on which the meeting is scheduled to be reconvened. Notice of the reconvening of
an adjourned meeting shall state expressly the percentage, as provided above, of
the principal amount of the Outstanding Securities of such series and Tranches
which shall constitute a quorum.
Except as limited by Section 14.02, any resolution presented to a
meeting or adjourned meeting duly reconvened at which a quorum is present as
aforesaid may be adopted only by the affirmative vote of the Holders of a
majority in aggregate principal amount of the Outstanding Securities of the
series and Tranches with respect to which such meeting shall have been called,
considered as one class; provided, however, that, except as so limited, any
resolution with respect to any action which this Indenture expressly provides
may be taken by the Holders of a specified percentage, which is less than a
majority, in principal amount of the Outstanding Securities of such series and
Tranches, considered as one class, may be adopted at a meeting or an adjourned
meeting duly reconvened and at which a quorum is present as aforesaid by the
affirmative vote of the Holders of such specified percentage in principal amount
of the Outstanding Securities of such series and Tranches, considered as one
class.
Any resolution passed or decision taken at any meeting of Holders of
Securities duly held in accordance with this Section shall be binding on all the
Holders of Securities of the series and Tranches with respect to which such
meeting shall have been held, whether or not present or represented at the
meeting.
SECTION 15.05 Attendance at Meetings; Determination of Voting Rights; Conduct
and Adjournment of Meetings.
(a) Attendance at meetings of Holders of Securities may be in person
or by proxy; and, to the extent permitted by law, any such proxy shall remain in
effect and be binding upon any future Holder of the Securities with respect to
which it was given unless and until specifically revoked by the Holder or future
Holder (except as provided in Section 1.06(g)) of such Securities before being
voted.
(b) Notwithstanding any other provisions of this Indenture, the
Trustee may make such reasonable regulations as it may deem advisable for any
meeting of Holders of Securities in regard to proof of the holding of such
Securities and of the appointment of proxies
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and in regard to the appointment and duties of inspectors of votes, the
submission and examination of proxies, certificates and other evidence of the
right to vote, and such other matters concerning the conduct of the meeting as
it shall deem appropriate. Except as otherwise permitted or required by any such
regulations and approved by the Company, the holding of Securities shall be
proved in the manner specified in Section 1.06 and the appointment of any proxy
shall be proved in the manner specified in Section 1.06. Such regulations may
provide that written instruments appointing proxies, regular on their face, may
be presumed valid and genuine without the proof specified in Section 1.06 or
other proof.
(c) The Trustee shall, by an instrument in writing, appoint a
temporary chairman of the meeting, unless the meeting shall have been called by
the Company or by Holders as provided in Section 15.02(b), in which case the
Company or the Holders of Securities of the series and Tranches calling the
meeting, as the case may be, shall in like manner appoint a temporary chairman.
A permanent chairman and a permanent secretary of the meeting shall be elected
by vote of the Persons entitled to vote a majority in aggregate principal amount
of the Outstanding Securities of all series and Tranches represented at the
meeting, considered as one class.
(d) At any meeting each Holder or proxy shall be entitled to one
vote for each One Thousand Dollars ($1,000) principal amount of Outstanding
Securities held or represented by such Holder; provided, however, that no vote
shall be cast or counted at any meeting in respect of any Security challenged as
not Outstanding and ruled by the chairman of the meeting to be not Outstanding.
The chairman of the meeting shall have no right to vote, except as a Holder of a
Security or proxy.
(e) Any meeting duly called pursuant to Section 15.02 at which a
quorum is present may be adjourned from time to time by Persons entitled to vote
a majority in aggregate principal amount of the Outstanding Securities of all
series and Tranches represented at the meeting, considered as one class; and the
meeting may be held as so adjourned without further notice.
SECTION 15.06 Counting Votes and Recording Action of Meetings.
The vote upon any resolution submitted to any meeting of Holders
shall be by written ballots on which shall be subscribed the signatures of the
Holders or of their representatives by proxy and the principal amounts and
serial numbers of the Outstanding Securities, of the series and Tranches with
respect to which the meeting shall have been called, held or represented by
them. The permanent chairman of the meeting shall appoint two (2) inspectors of
votes who shall count all votes cast at the meeting for or against any
resolution and who shall make and file with the secretary of the meeting their
verified written reports of all votes cast at the meeting. A record in duplicate
of the proceedings of each meeting of Holders shall be prepared by the secretary
of the meeting and there shall be attached to such record the original reports
of the inspectors of votes on any vote by ballot taken thereat and affidavits by
one or more persons having knowledge of the facts setting forth a copy of the
notice of the meeting and showing that such notice was given as provided in
Section 15.02 and, if applicable, Section 15.04. Each copy shall be signed and
verified by the affidavits of the permanent chairman and secretary of the
meeting and one such copy shall be delivered to the Company, and
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another to the Trustee to be preserved by the Trustee, the latter to have
attached thereto the ballots voted at the meeting. Any record so signed and
verified shall be conclusive evidence of the matters therein stated.
SECTION 15.07 Action Without Meeting.
In lieu of a vote of Holders at a meeting as hereinbefore
contemplated in this Article, any request, demand, authorization, direction,
notice, consent, waiver or other action may be made, given or taken by Holders
by one or more written instruments as provided in Section 1.05.
ARTICLE XVI
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IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS
-------------------------------------------------
AND DIRECTORS
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SECTION 16.01 Liability Solely Corporate.
No recourse shall be had for the payment of the principal of or
premium, if any, or interest, if any, on any Securities, or any part thereof, or
for any claim based thereon or otherwise in respect thereof, or of the
indebtedness represented thereby, or upon any obligation, covenant or agreement
under this Indenture, against any incorporator, stockholder, officer or
director, as such, past, present or future, of the Company or of any predecessor
or successor corporation (either directly or through the Company or a
predecessor or successor corporation), whether by virtue of any constitutional
provision, statute or rule of law or by the enforcement of any assessment or
penalty or otherwise; it being expressly agreed and understood that this
Indenture and all the Securities are solely corporate obligations and that no
personal liability whatsoever shall attach to, or be incurred by, any
incorporator, stockholder, officer or director, past, present or future, of the
Company or of any predecessor or successor corporation, either directly or
indirectly through the Company or any predecessor or successor corporation,
because of the indebtedness hereby authorized or under or by reason of any of
the obligations, covenants or agreements contained in this Indenture or in any
of the Securities or to be implied herefrom or therefrom; and such personal
liability, if any, is hereby expressly waived and released as a condition of,
and as part of the consideration for, the execution and delivery of this
Indenture, as originally executed and delivered, and the issuance of the
Securities.
-------------------------
This Indenture 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 Indenture. Any such
counterpart, as recorded or filed in any jurisdiction, may omit such portions of
Exhibits A and B hereto as shall not describe or refer to properties located in
- -------- - -
such jurisdiction.
107
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the day and year first above written.
SIERRA PACIFIC POWER COMPANY
By:
---------------------------------
Name:
Title:
THE BANK OF NEW YORK, as Trustee
By:
---------------------------------
Name:
Title:
108
STATE OF NEVADA )
) ss.:
COUNTY OF WASHOE )
On this ________ day of ________ 2001, before me personally appeared
__________________, to me known to be _______________________ of SIERRA PACIFIC
POWER COMPANY, one of the corporations that executed the within and foregoing
instrument, and acknowledged said instrument to be the free and voluntary act
and deed of said Corporation, for the uses and purposes therein mentioned, and
on oath stated that he was authorized to execute said instrument and that the
seal affixed, if any, is the corporate seal of said Corporation.
On the ____ day of ________ in the year ____ before me personally came
__________________ to me known, who, being by me duly sworn, did depose and say
that he resides at _______________________________; that he is
_____________________________ of SIERRA PACIFIC POWER COMPANY, the corporation
described in and which executed the above instrument; and that he signed his
name thereto by authority of the board of directors of said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year first above written.
_________________________________
Print Name
Notary Public in and for the State of Nevada, residing at __________________
Commission expires:_______________________
109
STATE OF NEW YORK )
) ss.:
COUNTY OF _____________ )
On the ____ day of May in the year 2001 before me, the undersigned,
personally appeared ______________________________________, personally known to
me or proved to me on the basis of satisfactory evidence to be the individual
whose name is subscribed to the within instrument and acknowledged to me that
[he/she] executed the same in [his/her] capacity, and that by [his/her]
signature on the instrument, the individual, or the person upon behalf of which
the individual acted, executed the instrument.
_________________________________
Print Name:
Notary Public in and for the State of New York
Commission expires:_______________________
110
Exhibit A
REAL PROPERTY
State of Nevada
---------------
A-1
Exhibit B
LICENSES, PERMITS, ETC.
State of Nevada
---------------
B-1
Exhibit C
RECORDING INFORMATION
C-1
Exhibit D
EXCEPTED WATER PROPERTIES
E-1