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Registration Nos. 333-01035 and 333-01035-01
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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MINNESOTA POWER & LIGHT COMPANY
(Exact name of registrant as specified in its charter)
Minnesota 41-0418150
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
MP&L CAPITAL I
(Exact name of registrant as specified in its charter)
Delaware To Be Applied For
(State of incorporation or (I.R.S. Employer
organization) Identification No.)
30 West Superior Street
Duluth, Minnesota 55802
(218) 722-2641
(Address, including zip code, and telephone number,
including area code,
of registrant's principal executive offices)
DAVID G. GARTZKE PHILIP R. HALVERSON, Esq.
Senior Vice President-Finance Vice President, General Counsel
and Chief Financial Officer and Corporate Secretary
30 West Superior Street 30 West Superior Street
Duluth, Minnesota 55802 Duluth, Minnesota 55802
(218) 722-2641 (218) 722-2641
JAMES K. VIZANKO ROBERT J. REGER, JR., Esq.
Corporate Treasurer Reid & Priest LLP
30 West Superior Street 40 West 57th Street
Duluth, Minnesota 55802 New York, New York 10019
(218) 722-2641 (212) 603-2000
(Names and addresses, including zip codes, and telephone numbers,
including area codes, of agents for service)
---------------
It is respectfully requested that the Commission
send copies of all notices, orders and communications to:
MICHAEL CONNOLLY, Esq.
Lane & Mittendorf LLP
320 Park Avenue
New York, New York 10022
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CALCULATION OF REGISTRATION FEE
====================================================================
Title of
Each Proposed Proposed
Class Maximum Maximum Amount
of Amount Offering Aggregate of
to Be to Be Per Offering Registration
Registered Registered Unit(1) Price(1)(2) Fee
--------------------------------------------------------------------
MP&L
Capital I
Cumulative
Quarterly
Income
Preferred
Securities... 3,000,000 $25 $75,000,000(3) $25,862(3)
-------------------------------------------------------------------
Minnesota
Power &
Light Company
Guarantee with
respect to MP&L
Capital I
Cumulative
Quarterly Income
Preferred
Securities
and obligations
under an
Agreement
as to
Expenses and
Liabilities
between the
Company
and MP&L
Capital I(4)..
-------------------------------------------------------------------
Minnesota
Power &
Light Company
Junior
Subordinated
Debentures,
Series(5)....
===================================================================
(1) Estimated solely for the purpose of calculating the
registration fee.
(2) Exclusive of accrued distributions, if any.
(3) The Cumulative Quarterly Income Preferred Securities being
registered are hereby reduced from 5,000,000 to 3,000,000.
(4) No separate consideration will be received for the Minnesota
Power & Light Company (the "Company") Guarantee and the
Company's obligations under the Agreement as to
Expenses and Liabilities.
(5) The Junior Subordinated Debentures will be purchased by MP&L
Capital I with the proceeds of the sale of the Preferred
Securities. No separate consideration will be received for
the Junior Subordinated Debentures.
The registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its effective
date until the registrant shall file a further amendment which
specifically states that this Registration Statement shall
thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement
shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
SUBJECT TO COMPLETION, DATED MARCH 11, 1996
3,000,000 Preferred Securities
MP&L CAPITAL I
% Cumulative Quarterly Income Preferred Securities
(QUIPS SM)*
(Liquidation preference $25.00 per Preferred Security)
Guaranteed to the extent
MP&L Capital I has funds as set forth herein by
MINNESOTA POWER & LIGHT COMPANY
-------------------
The % Cumulative Quarterly Income Preferred Securities
(the "Preferred Securities") offered hereby are being issued by
and represent undivided preferred beneficial interests in the
assets of MP&L Capital I ("MP&L Capital"), a statutory business
trust created under the laws of the State of Delaware. Minnesota
Power & Light Company (the "Company"), a Minnesota corporation,
will be the owner of the undivided common beneficial interests in
the assets represented by common securities of MP&L Capital (the
"Common Securities", together with the Preferred Securities
herein referred to as the "Trust Securities"). The Bank of New
York is the Property Trustee of MP&L Capital. MP&L Capital
exists for the sole purpose of issuing the Preferred Securities
and the Common Securities and investing the proceeds thereof in
% Junior Subordinated Debentures, Series , Due , to
be issued by the Company (the "Junior Subordinated Debentures")
in an aggregate principal amount equal to the aggregate
liquidation preference amount of the Trust Securities. The
Preferred Securities will have a preference under certain
circumstances with respect to cash distributions and amounts
payable on liquidation, redemption or otherwise over the Common
Securities. See "Description of the Preferred Securities --
Subordination of Common Securities."
(cover continued on following page)
--------------------
SEE "RISK FACTORS," BEGINNING ON PAGE 6, FOR CERTAIN
INFORMATION RELEVANT TO AN INVESTMENT IN THE PREFERRED
SECURITIES, INCLUDING THE PERIOD AND CIRCUMSTANCES DURING AND
UNDER WHICH PAYMENT OF DISTRIBUTIONS ON THE PREFERRED SECURITIES
MAY BE DEFERRED AND CERTAIN RELATED FEDERAL INCOME TAX
CONSEQUENCES.
--------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR BY ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
--------------------
Initial
Public
Offering Underwriting Proceeds to
Price Commission (1) Company(2)(3)
-------- -------------- -------------
Per Preferred
Security . . . . . $ (2) $
Total. . . . . . . $ (2) $
___________
(1) MP&L Capital and the Company have agreed to indemnify the
several Underwriters against certain liabilities, including
liabilities under the Securities Act of 1933, as amended
(1933 Act). See "Underwriting."
(2) In view of the fact that the entire proceeds of the sale of
the Preferred Securities will be used to purchase the Junior
Subordinated Debentures, the Underwriting Agreement provides
that the Company will pay to the Underwriters, as
compensation for their arranging the investment therein of
such proceeds, $ per Preferred Security (or $ in
the aggregate). See "Underwriting."
(3) Expenses of the offering, which are payable by the Company,
are estimated to be $ .
--------------------
The Preferred Securities offered hereby are offered
severally by the Underwriters, as specified herein, and subject
to receipt and acceptance by them and subject to their right to
reject any order in whole or in part. It is expected that
delivery of the Preferred Securities will be made only in
book-entry form through the facilities of DTC on or about
, 1996 against payment therefor in immediately available funds.
*QUIPS is a service mark of Goldman, Sachs & Co.
GOLDMAN, SACHS & CO. PAINEWEBBER INCORPORATED
The date of this Prospectus is , 1996.
Information contained herein is subject to completion or
amendment. A Registration Statement relating to these securities
has been filed with the Securities and Exchange Commission.
These securities may not be sold nor may offers to buy be
accepted prior to the time the Registration Statement becomes
effective. This prospectus shall not constitute an offer to sell
or the solicitation of an offer to buy nor shall there be any
sale of these securities in any jurisdiction in which such offer,
solicitation, or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
(cover continued)
Registered owners (the "Holders") of the Preferred
Securities will be entitled to receive preferential cumulative
cash distributions accruing from the date of original issuance
and payable quarterly in arrears on the last day of March, June,
September and December of each year, commencing , 1996,
at the per annum rate of % of the liquidation preference
amount of $25 per Preferred Security (together, at any given
time, with any accrued but unpaid such amounts and interest
thereon, if any, "Distributions"). Interest on the Junior
Subordinated Debentures is the sole source of income for MP&L
Capital from which payment of Distributions on the Preferred
Securities can be made. The Company has the right to defer
payments of interest on the Junior Subordinated Debentures by
extending the interest payment period thereon at any time or from
time to time for up to 20 consecutive quarters with respect to
each deferral period (each, an "Extension Period"), provided that
any such Extension Period may not extend beyond the maturity of
the Junior Subordinated Debentures. Upon the termination of any
Extension Period and the payment of all amounts then due,
including interest on deferred interest payments, the Company may
select a new Extension Period, subject to the above requirements.
If interest payments on the Junior Subordinated Debentures
are deferred, Distributions on the Preferred Securities will also
be deferred and the Company will not be permitted, subject to
certain exceptions set forth herein, to (i) declare or pay
dividends or distributions on (other than dividends or
distributions paid in shares of Common Stock of the Company) or
redeem, purchase, acquire or make a liquidation payment with
respect to, any of its capital stock, or (ii) make any payment of
principal of, interest or premium, if any, on, or repay,
repurchase or redeem any indebtedness that is pari passu with the
Junior Subordinated Debentures (including other Debt Securities,
as defined herein) or make any guarantee payment with respect to
the foregoing. During an Extension Period, quarterly
Distributions on the Preferred Securities will continue to accrue
and Distributions that are in arrears will bear interest on the
amount thereof at the per annum rate of % (to the extent
permitted by applicable law, compounded quarterly), and Holders
of Preferred Securities will be required to accrue income for
United States federal income tax purposes. See "Description of
the Junior Subordinated Debentures -- Option to Extend Interest
Payment Period" and "Certain United States Federal Income Tax
Consequences -- Potential Extension of Interest Payment Period
and Original Issue Discount." Any Extension Period with
respect to payment of interest on the Junior Subordinated
Debentures, other Debt Securities (as defined herein) or on any
similar securities will apply to all such securities and will
also apply to Distributions with respect to the Preferred
Securities and all other securities with terms substantially the
same as the Preferred Securities. Based upon the Company's
current financial condition and, in light of the restriction on
payment of dividends on the Company's securities during an
Extension Period, the Company believes that an extension of a
distribution payment period on the Preferred Securities is
currently unlikely and has no current intention to cause such an
extension. See "Description of the Preferred Securities --
Distributions."
The payment of Distributions and payments on liquidation of
MP&L Capital or the redemption of Preferred Securities, in each
case out of moneys held by MP&L Capital as set forth below, are
guaranteed by the Company to the extent MP&L Capital has
sufficient funds available to make such payments (the
"Guarantee"). See "Description of the Guarantee." If the
Company fails to make interest payments on the Junior
Subordinated Debentures held by MP&L Capital, MP&L Capital will
have insufficient funds to pay Distributions on the Preferred
Securities. The Guarantee does not cover payment of
Distributions when MP&L Capital does not have sufficient funds to
pay such Distributions. In such event, the remedy of a Holder of
Preferred Securities would be enforcement of the rights of MP&L
Capital under the Junior Subordinated Debentures held by MP&L
Capital. See "Description of the Preferred Securities -- Voting
Rights." The Company's obligations under the Guarantee are
subordinate and junior in right of payment to Senior Indebtedness
of the Company except any liabilities that may be made pari passu
expressly by their terms. The Company has agreed in an Agreement
as to Expenses and Liabilities (the "Expense Agreement") to
provide funds to MP&L Capital as needed to pay obligations of
MP&L Capital to parties other than Holders of Trust Securities.
The obligations of the Company with respect to the Guarantee, the
Expense Agreement and the Junior Subordinated Debentures
constitute a full and unconditional guarantee of the Preferred
Securities by the Company.
The Preferred Securities are subject to mandatory redemption
upon repayment of the Junior Subordinated Debentures at maturity
or upon their earlier redemption. See "Description of the
Preferred Securities -- Redemption Procedures." The Company will
have the option at any time on or after , to redeem
the Junior Subordinated Debentures, in whole or in part. The
Company also will have the option, upon the occurrence and during
the continuation of a Special Event (as defined herein), (i) to
redeem at any time the Junior Subordinated Debentures, in whole
but not in part, which will result in the redemption of all the
Trust Securities by MP&L Capital or (ii) to cause the termination
of MP&L Capital and, in connection therewith, after satisfaction
of creditors of MP&L Capital, if any, to cause the distribution
of Junior Subordinated Debentures to the Holders of Preferred
(cover continued)
Securities and the Common Securities. Any redemption of Trust
Securities by MP&L Capital will be in amounts having an aggregate
liquidation preference amount equal to the aggregate principal of
Junior Subordinated Debentures to be redeemed and will be at a
redemption price equal to 100% of such liquidation preference
amount, plus accrued and unpaid Distributions, if any, to the
redemption date (the "Redemption Price"). Each class of the
Trust Securities will be redeemed in proportion to the percentage
they represent of all the Trust Securities. See "Description of
the Junior Subordinated Debentures -- Optional Redemption."
The Junior Subordinated Debentures are subordinate and
junior in right of payment to all Senior Indebtedness (as defined
herein) of the Company. The terms of the Junior Subordinated
Debentures place no limitation on the amount of Senior
Indebtedness that may be incurred by the Company. As of December
31, 1995, the Company had approximately $790 million of principal
amount of indebtedness for borrowed money and capital lease
obligations constituting Senior Indebtedness (as defined herein).
See "Description of the Junior Subordinated Debentures --
Subordination" and "Description of the Preferred Securities."
In the event of the liquidation of MP&L Capital, the Holders
of the Trust Securities will be entitled to receive either (i)
Junior Subordinated Debentures in an aggregate principal amount
of $25 per Preferred Security or (ii) a liquidation preference
amount of $25 per Preferred Security, plus accrued and unpaid
Distributions thereon to the date of payment, subject to certain
limitations. See Description of the "Preferred Securities --
Liquidation Distribution upon Termination."
Application will be made to list the Preferred Securities on
the New York Stock Exchange (the "NYSE").
The Preferred Securities will be represented by global
certificates registered in the name of The Depository Trust
Company (the "DTC") or its nominee. Beneficial interests in the
Preferred Securities will be shown on, and transfers thereof will
be effected only through, records maintained by participants in
DTC. Except as described herein, Preferred Securities in
certificated form will not be issued in exchange for the global
certificates. See "Description of the Preferred Securities --
Book-Entry Only Issuance - The Depository Trust Company."
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY
OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE
MARKET PRICE OF THE PREFERRED SECURITIES OFFERED HEREBY AT LEVELS
ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE,
IN THE OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF
COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of
the Securities Exchange Act of 1934 (the "1934 Act") and, in
accordance therewith, files reports, proxy statements and other
information with the Securities and Exchange Commission (the
"Commission"). Such reports, proxy statements and other
information filed by the Company may be inspected and copied at
the public reference facilities maintained by the Commission at
450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at
the following Regional Offices of the Commission: New York
Regional Office, 7 World Trade Center, 13th Floor, New York, New
York 10048; and Chicago Regional Office, Citicorp Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies
of such material may also be obtained at prescribed rates from
the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549. The Company's Common Stock
is listed on the New York Stock Exchange. Reports and other
information concerning the Company may be inspected and copied at
the office of such Exchange at 20 Broad Street, New York, New
York. In addition, certain of the Company's preferred stocks are
listed on the American Stock Exchange. Reports and other
information concerning the Company may be inspected and copied at
the office of such Exchange at 86 Trinity Place, New York, New
York.
No separate financial statements of MP&L Capital are
included herein. The Company considers that such financial
statements would not be material to Holders of the Preferred
Securities because the Company is a reporting company under the
1934 Act and MP&L Capital has no independent operations, but
exists for the sole purpose of issuing the Trust Securities and
holding as trust assets the Junior Subordinated Debentures.
MP&L Capital will not file separate reports under the 1934
Act. The obligations of the Company under the Junior
Subordinated Debentures to pay principal and interest, and the
obligations of the Company under the Junior Subordinated
Debentures and pursuant to the Trust Agreement to pay amounts
equal to all expenses of MP&L Capital, together with the
Guarantee and the rights of the Holders of Preferred Securities
to directly enforce the Company's obligations with respect to the
Junior Subordinated Debentures, constitute a full and
unconditional guarantee by the Company of payments due on the
Preferred Securities. See "Description of the Junior
Subordinated Debentures -- Additional Interest" and "Description
of the Guarantee -- Events of Default."
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, filed by the Company with the
Commission pursuant to the 1934 Act, are hereby incorporated by
reference:
1. The Company's Annual Report on Form 10-K for the year
ended December 31, 1994 (the "Company 1994 10-K")
except for Items 7, 8 and 14(a)(1) thereof;
2. The Company's Quarterly Reports on Form 10-Q for the
quarters ended March 31, 1995, June 30, 1995 and
September 30, 1995;
3. The Company's Current Reports on Form 8-K dated January
5, 1995, February 23, 1995, February 27, 1995 (as
amended on Form 8-K/A dated May 25, 1995), March 3,
1995, July 12, 1995 (as amended on Form 8-K/A dated
September 8, 1995), October 6, 1995, January 8, 1996,
February 16, 1996 and March 11, 1996.
Each document filed subsequent to the date of this
Prospectus pursuant to Section 13(a), 13(c), 14 or 15(d) of the
1934 Act prior to the termination of the offering made by this
Prospectus shall be deemed to be incorporated by reference in
this Prospectus and shall be a part hereof from the date of
filing of such document; provided, however, that the documents
enumerated above or subsequently filed by the Company pursuant to
Section 13 of the 1934 Act prior to the filing with the
Commission of the Company's most recent Annual Report on Form 10-
K shall not be incorporated by reference in this Prospectus or be
a part hereof from and after the filing of such Annual Report on
Form 10-K. The documents which are incorporated by reference in
this Prospectus are sometimes hereinafter referred to as the
"Incorporated Documents."
Any statement contained in a document incorporated or deemed
to be incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other
subsequently filed document which is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this
Prospectus.
The Company will provide without charge to each person,
including any beneficial owner, to whom a copy of this Prospectus
is delivered, upon the written or oral request of any such
person, a copy of any document referred to above which has been
or may be incorporated in this Prospectus by reference, other
than exhibits to such documents (unless such exhibits are
specifically incorporated by reference into such documents).
Requests for such copies should be directed to: Shareholder
Services, Minnesota Power, 30 West Superior Street, Duluth,
Minnesota 55802, telephone number (218) 723-3974 or (800) 535-
3056.
PROSPECTUS SUMMARY
The following is a summary of certain information contained
herein and should be read in conjunction with such information
contained elsewhere in this Prospectus and is subject to and
qualified by reference to such information. Capitalized terms
used herein have the respective meanings ascribed to them
elsewhere in this Prospectus.
THE COMPANY
The Company was incorporated under the laws of the State of
Minnesota in 1906 and is a diversified electric utility engaged
in the generation, purchase, transmission, distribution and sale
of electric energy wholly within the state of Minnesota. The
principal executive offices of the Company are located at 30 West
Superior Street, Duluth, Minnesota 55802; and the telephone
number is (218) 722-2641.
MP&L CAPITAL
MP&L Capital is a Delaware statutory business trust created
for the exclusive purposes of (i) issuing the Preferred
Securities and Common Securities representing undivided
beneficial interests in the assets of MP&L Capital, (ii) holding
as trust assets the Junior Subordinated Debentures and (iii)
engaging in only those other activities necessary or incidental
thereto. Upon issuance of the Preferred Securities, the Holders
thereof will own all of the issued and outstanding Preferred
Securities. The Company has agreed to acquire Common Securities
in an amount equal to at least 3% of the total capital of MP&L
Capital and will own all of the issued and outstanding Common
Securities.
DESCRIPTION OF PREFERRED SECURITIES AND JUNIOR SUBORDINATED
DEBENTURES
The Preferred Securities are undivided preferred beneficial
interests in the assets of MP&L Capital and will have a
preference, under certain circumstances, with respect to cash
Distributions and amounts payable on liquidation, redemption or
otherwise over the trust interests represented by the Common
Securities issued by MP&L Capital.
Holders of the Preferred Securities will be entitled to
receive cumulative cash Distributions accruing from the date of
original issuance and payable quarterly in arrears on the last
day of March, June, September and December of each year,
commencing , 1996, at the per annum rate of % of
the liquidation preference amount thereof to the persons in whose
names the Preferred Securities are registered at the close of
business on the relevant record dates. Such Distributions will
originally accrue from, and include, the Closing Date and will
accrue to, and include, the first distribution payment date, and
thereafter will accrue from, and exclude, the last distribution
payment date through which Distributions have been paid. In the
event that any date on which a distribution is payable on the
Preferred Securities is not a Business Day (as defined herein),
then such distribution will be made on the next succeeding
Business Day (and without any interest or other payment in
respect of any such delay), except that, if such Business Day is
in the next succeeding calendar year, such payment shall be made
on the immediately preceding Business Day, in each case with the
same force and effect as if made on such date.
MP&L Capital will hold Junior Subordinated Debentures in an
aggregate principal amount equal to the liquidation preference
amount of the Trust Securities. The Junior Subordinated
Debentures are unsecured subordinated debt securities issued
under an Indenture dated as of , 1996, between the
Company and The Bank of New York, as Trustee (the "Indenture").
MP&L Capital will use interest payments on the Junior
Subordinated Debentures to make Distributions on the Preferred
Securities. The Junior Subordinated Debentures will be
subordinate to all Senior Indebtedness of the Company but are
senior to all capital stock of the Company.
The Company has the right to defer payments of interest on
the Junior Subordinated Debentures during Extension Periods of up
to 20 consecutive quarters, provided that no single distribution
payment period, as extended, may exceed 20 consecutive quarterly
interest payment periods or extend beyond the maturity of the
Junior Subordinated Debentures. Distributions on the Preferred
Securities will accrue with interest, compounded quarterly, but
will not be payable, during an Extension Period. The Company may
prepay at any time all or any portion of the interest accrued
during an Extension Period. Based upon the Company's current
financial condition and, in light of the restriction on payment
of dividends during an Extension Period, the Company believes
that an extension of a distribution payment period on the
Preferred Securities is unlikely and has no current intention to
cause such an extension of a distribution payment period. Upon
the termination of any Extension Period and the payment of all
amounts then due, the Company may elect another Extension Period.
The Company will give MP&L Capital and the Debenture Trustee
notice of its election of an Extension Period prior to the
earlier of (i) one Business Day prior to the record date for the
distribution which would occur but for such election or (ii) the
date the Company is required to give notice to the NYSE or other
applicable self-regulatory organization of such record date and
will cause MP&L Capital to send notice of such election to the
Holders of Preferred Securities.
If and to the extent the Company makes interest payments on
the Junior Subordinated Debentures deposited in MP&L Capital as
trust assets, the Property Trustee is obligated to make
Distributions promptly on the Preferred Securities. The payment
of Distributions on the Preferred Securities and payments on
liquidation of MP&L Capital and the redemption of Preferred
Securities are guaranteed by the Company if and to the extent
that MP&L Capital has funds available therefor.
The Junior Subordinated Debentures are redeemable, in whole
or in part, on or after , or at any time upon the
occurrence of a Special Event and in certain other circumstances,
at the option of the Company. Upon redemption of the Junior
Subordinated Debentures, the Preferred Securities and the Common
Securities will be redeemed on a pro rata basis to the same
extent as the Junior Subordinated Debentures are redeemed.
Upon the occurrence and during the continuation of a Special
Event, the Company may elect (i) to redeem the Junior
Subordinated Debentures at any time, in whole but not in part, in
which event all of the Trust Securities will be redeemed or (ii)
to cause the termination of MP&L Capital, in which event, after
the satisfaction of creditors of MP&L Capital, if any, the Junior
Subordinated Debentures will be distributed to the Holders of the
Preferred Securities and the Common Securities on a pro rata
basis. If at any time MP&L Capital is not or will not be taxed
as a grantor trust but a Tax Event in respect of the Preferred
Securities has not occurred, the Company has the right to
terminate MP&L Capital and cause the Junior Subordinated
Debentures to be distributed to the Holders of the Preferred
Securities in liquidation of MP&L Capital. If the Junior
Subordinated Debentures are distributed to the Holders of the
Preferred Securities, the Company will use its best efforts to
have the Junior Subordinated Debentures listed on the New York
Stock Exchange or on such other exchange as the Preferred
Securities are then listed. See "Description of the Preferred
Securities -- Special Event Redemption or Distribution."
The Company will guarantee payment, where applicable, of
accrued and unpaid Distributions, the Redemption Price and
amounts due upon liquidation, to the extent MP&L Capital has
funds available therefor.
The Trust Agreement (as defined herein) provides that the
Company shall pay for all debts and obligations (other than with
respect to the Trust Securities) and all costs and expenses of
MP&L Capital, including any taxes and all costs and expenses with
respect thereto, to which MP&L Capital may become subject, except
for United States withholding taxes.
No sinking fund will be established for the benefit of the
Preferred Securities.
RISK FACTORS
Prospective purchasers of Preferred Securities should
carefully review the information contained elsewhere herein and
should particularly consider the following risk factors with
respect to the Preferred Securities:
Ranking of Subordinated Obligations Under the Guarantee and the
Junior Subordinated Debentures
The Company's obligations under the Guarantee issued by the
Company for the benefit of the Holders of the Preferred
Securities are unsecured and rank subordinate and junior in right
of payment to Senior Indebtedness of the Company, except any
liabilities that may be made pari passu expressly by their terms.
The obligations of the Company under the Junior Subordinated
Debentures are subordinate and junior in right of payment to
Senior Indebtedness of the Company. As of December 31, 1995,
Senior Indebtedness of the Company aggregated approximately $790
million. There are no terms of the Preferred Securities, the
Junior Subordinated Debentures or the Guarantee that limit the
Company's ability to incur additional indebtedness, including
indebtedness that would rank senior to the Junior Subordinated
Debentures and the Guarantee. See "Description of the Guarantee
-- Status of the Guarantee" and "Description of the Junior
Subordinated Debentures -- Subordination."
The ability of MP&L Capital to pay amounts due on the
Preferred Securities is solely dependent upon the Company making
payments on the Junior Subordinated Debentures as and when
required.
Option to Extend Interest Payment Period; Tax Consequences
The Company has the right under the Indenture to extend the
interest payment period at any time and from time to time on the
Junior Subordinated Debentures, for a period not exceeding 20
consecutive quarters. As a consequence of any such extension,
quarterly Distributions on the Preferred Securities would be
deferred by MP&L Capital during such Extension Period, but would
continue to accumulate additional Distributions thereon at the
rate of % per annum. In the event that the Company exercises
this right, during any Extension Period the Company may not (i)
declare or pay dividends or distributions (other than dividends
or distributions in Common Stock of the Company) on, or redeem,
purchase, acquire, or make a liquidation payment with respect to
any of its capital stock, or (ii) make any payment of principal,
interest or premium, if any, on or repay, repurchase or redeem
any indebtedness that is pari passu with the Junior Subordinated
Debentures (including other Debt Securities, as defined herein)
or make any guarantee payment with respect to the foregoing.
Prior to the termination of any such Extension Period, the
Company may further extend the interest payment period, provided
that such Extension Period together with all such previous and
further extensions thereof may not exceed 20 consecutive quarters
and that such extended interest payment period may not extend
beyond the maturity date of the Junior Subordinated Debentures.
Any Extension Period with respect to payment of interest on the
Junior Subordinated Debentures, other Debt Securities or on any
similar securities will apply to all such securities and will
also apply to distributions with respect to the Preferred
Securities and all other securities with terms substantially the
same as the Preferred Securities. See "Description of the
Preferred Securities -- Distributions" and "Description of the
Junior Subordinated Debentures -- Option to Extend Interest
Payment Period."
Because the Company has the right to extend the interest
payment period on the Junior Subordinated Debentures, the Junior
Subordinated Debentures will be treated as having been issued
with original issue discount ("OID") for United States federal
income tax purposes. As a result, Holders of Preferred
Securities will be required to include in their gross income
Distributions as they accrue, rather than when they are paid,
regardless of the Holder's regular method of accounting. OID on
the Preferred Securities will be treated as interest and will
generally be equal to the Distributions on the Preferred
Securities each year. Should an Extension Period occur, a Holder
of Preferred Securities will continue to accrue interest (in the
form of OID) in income in respect of its pro rata share of the
Junior Subordinated Debentures held by MP&L Capital for United
States federal income tax purposes. As a result, a Holder of
Preferred Securities will include such interest in gross income
for United States federal income tax purposes in advance of the
receipt of cash, and will not receive the cash related to such
income from MP&L Capital if the Holder disposes of the Preferred
Securities prior to the record date for the payment of
Distributions. See "Certain United States Federal Income Tax
Considerations -- Potential Extension of Interest Payment Period
and Original Issue Discount."
The Company has no current intention of exercising its right
to defer payments of interest by extending the interest payment
period on the Junior Subordinated Debentures. However, should
the Company elect to exercise such right in the future, the
market price of the Preferred Securities is likely to be
affected. A Holder that disposes of its Preferred Securities
during an Extension Period, therefore, might not receive the same
return on its investment as a Holder that continues to hold its
Preferred Securities. In addition, as a result of the existence
of the Company's right to defer interest payments, the market
price of the Preferred Securities (which represent a preferred
undivided beneficial interest in the Junior Subordinated
Debentures) may be more volatile than other securities on which
original issue discount accrues that do not have such rights.
Special Event Redemption or Distribution; Potential Adverse
Effect on Market Price
Upon the occurrence and continuation of a Special Event, the
Company has the right to (i) redeem the Junior Subordinated
Debentures, in whole but not in part, and therefore cause a
mandatory redemption of all the Preferred Securities at the
Redemption Price within 90 days following the occurrence of such
Special Event or (ii) cause the termination of MP&L Capital and,
in connection therewith, after satisfaction of creditors of MP&L
Capital, if any, cause the Junior Subordinated Debentures to be
distributed to the Holders of Trust Securities at the Redemption
Price within 90 days following the occurrence of such Special
Event. If at any time MP&L Capital is not or will not be taxed
as a grantor trust but a Tax Event (as defined herein) in respect
of the Preferred Securities has not occurred, the Company has the
right to terminate MP&L Capital and cause the Junior Subordinated
Debentures to be distributed to the Holders of the Preferred
Securities in liquidation of MP&L Capital. There can be no
assurance as to the market prices for the Junior Subordinated
Debentures which may be distributed in exchange for Preferred
Securities if a termination and liquidation of MP&L Capital were
to occur. Accordingly, such Junior Subordinated Debentures
could, if distributed, trade at a discount to the price of the
Preferred Securities exchanged. See "Description of the
Preferred Securities -- Special Event Redemption or Distribution"
and "Certain United States Federal Income Tax Consequences."
On December 7, 1995, the U.S. Treasury Department proposed
certain tax law changes that, among other things, would generally
deny interest deductions to corporate issuers of debt if the debt
instrument has a term exceeding 20 years and is not reflected as
indebtedness on the issuer's balance sheet. As described in the
Treasury Department's proposal, the proposed changes would not
affect the ability of the Company to deduct interest on the
Junior Subordinated Debentures because the term of the Junior
Subordinated Debentures is _____ years. However, there can be no
assurance that subsequent proposals or final legislation will not
affect the ability of the Company to deduct interest on the
Junior Subordinated Debentures, which in turn could give rise to
a Tax Event, as described more fully under "Description of the
Preferred Securities -- Special Event Redemption or
Distribution." Accordingly, there can be no assurance that a
Special Event will not occur.
There can be no assurance as to the market prices for
Preferred Securities or Junior Subordinated Debentures that may
be distributed in exchange for Preferred Securities if a
dissolution or liquidation of MP&L Capital were to occur.
Accordingly, the Preferred Securities that an investor may
purchase, whether pursuant to the offer made hereby or in the
secondary market, or the Junior Subordinated Debentures that a
Holder of Preferred Securities may receive on termination and
liquidation of the MP&L Capital, may trade at a discount to the
price that the investor paid to purchase the Preferred Securities
offered hereby. Because Holders of Preferred Securities may
receive Junior Subordinated Debentures upon the occurrence of a
Special Event, prospective purchasers of Preferred Securities are
also making an investment decision with regard to the Junior
Subordinated Debentures and should carefully review all the
information regarding the Junior Subordinated Debentures
contained herein. See "Description of the Preferred Securities -
- Special Event Redemption or Distribution" and "Description of
the Junior Subordinated Debentures -- General" in the
accompanying Prospectus.
Limited Voting Rights
Holders of Preferred Securities will generally have limited
voting rights relating only to the modification of the Preferred
Securities and the dissolution, winding-up or termination of MP&L
Capital. Holders of Preferred Securities will not be entitled to
vote to appoint, remove or replace the Property Trustee or the
Delaware Trustee, which voting rights are vested exclusively in
the Holder of the Common Securities except upon the occurrence of
certain events described herein. The Administrative Trustees and
the Company may amend the Trust Agreement to ensure that MP&L
Capital will be classified for United States federal income tax
purposes as a grantor trust without the consent of Holders, even
if such action adversely affects the interests of Holders. See
"Description of the Preferred Securities -- Voting Rights", "--
Amendments" and "-- Co-Trustees and Separate Property Trustees."
Rights Under the Guarantee; Limitation as to Funds Available to
MP&L Capital
The Guarantee will be qualified as an indenture under the
Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"). The Bank of New York will act as indenture trustee under
the Guarantee for the purposes of compliance with the Trust
Indenture Act (the "Guarantee Trustee") and will hold the
Guarantee for the benefit of the Holders of the Preferred
Securities. The Bank of New York will also act as trustee for
the Junior Subordinated Debentures and as Property Trustee under
the Trust Agreement.
The Guarantee guarantees to the Holders of the Preferred
Securities to the extent not paid by MP&L Capital, the payment
(but not the collection) of (i) any accrued and unpaid
Distributions required to be paid on the Preferred Securities, to
the extent MP&L Capital has funds available therefor, (ii) the
Redemption Price with respect to Preferred Securities called for
redemption by MP&L Capital, to the extent MP&L Capital has funds
available therefor and (iii) upon a voluntary or involuntary
dissolution, winding-up or termination of MP&L Capital (unless
the Junior Subordinated Debentures are distributed to Holders of
the Preferred Securities), the lesser of (a) the aggregate of the
liquidation preference amount and all accrued and unpaid
Distributions on the Preferred Securities to the date of payment
and (b) the amount of assets of MP&L Capital remaining available
for distribution to Holders of the Preferred Securities in
liquidation of MP&L Capital. The Holders of not less than a
majority in aggregate liquidation preference amount of the
Preferred Securities have the right to direct the time, method
and place of conducting any proceeding for any remedy available
to the Guarantee Trustee or to direct the exercise of any trust
power conferred upon the Guarantee Trustee under the Guarantee.
Any Holder of Preferred Securities may institute a legal
proceeding directly against the Company to enforce the Guarantee
Trustee's rights under the Guarantee without first instituting a
legal proceeding against MP&L Capital, the Guarantee Trustee or
any other person or entity. If the Company were to default on
its obligations under the Junior Subordinated Debentures, MP&L
Capital would lack available funds for the payment of
Distributions or amounts payable on redemption of the Preferred
Securities or otherwise, and in such event Holders of the
Preferred Securities would not be able to rely upon the Guarantee
for payment of such amounts. If the Property Trustee fails to
enforce its rights under the Junior Subordinated Debentures or
the Trust Agreement, any Holder of Preferred Securities may
institute a legal proceeding directly against the Company to
enforce the Property Trustee's rights under the Junior
Subordinated Debentures or the Trust Agreement, to the fullest
extent permitted by law, without first instituting any legal
proceeding against the Property Trustee or any other person or
entity. See "Description of the Guarantee -- Status of the
Guarantee" and "Description of the Junior Subordinated Debentures
-- Subordination" herein. The Trust Agreement pursuant to which
MP&L Capital has been formed provides that each Holder of
Preferred Securities by acceptance thereof agrees to the
provisions of the Guarantee and the Indenture.
The Preferred Securities are subject to mandatory redemption
upon repayment of the Junior Subordinated Debentures at maturity
or upon their earlier redemption. See "Description of the
Preferred Securities -- Redemption Procedures." The Company will
have the option at any time on or after upon not
less than 45 days' notice, to redeem the Junior Subordinated
Debentures, in whole or in part.
Trading Characteristics of Preferred Securities
The Preferred Securities constitute a new issue of
securities with no established trading market. While the Company
will apply to list the Preferred Securities on the NYSE, a
minimum of 400 beneficial holders and 1,000,000 outstanding
securities is required for listing a new class of securities on
the NYSE. Accordingly, no assurance can be given as to the
liquidity of, or the development and maintenance of trading
markets for, the Preferred Securities. If approved for listing,
the Preferred Securities may trade at a price that does not fully
reflect the value of accrued but unpaid interest with respect to
the underlying Junior Subordinated Debentures. A Holder that
disposes of Preferred Securities between record dates for
payments of Distributions thereon will be required to include
accrued but unpaid interest on the Junior Subordinated Debentures
through the date of disposition in income as ordinary income and
to add such amount to such Holder's adjusted tax basis in such
Holder's pro rata share of the underlying Junior Subordinated
Debentures deemed disposed of. To the extent the selling price
is less than such Holder's adjusted tax basis (which will
include, in the form of OID, all accrued and unpaid interest),
such Holder will recognize a capital loss. Subject to certain
limited exceptions, capital losses cannot be applied to offset
ordinary income for United States federal income tax purposes.
See "Certain United States Federal Income Tax Consequences --
Potential Extension of Interest Payment Period and Original Issue
Discount" and "-- Sale, Exchange and Redemption of the Preferred
Securities."
THE COMPANY
The Company is an operating public utility incorporated
under the laws of the State of Minnesota since 1906. Its
principal executive office is at 30 West Superior Street, Duluth,
Minnesota 55802, and its telephone number is (218) 722-2641. The
Company has operations in four business segments: (1) electric
operations, which include electric and gas services, and coal
mining; (2) water operations, which include water and wastewater
services; (3) automobile auctions, which also include a finance
company and an auto transport company; and (4) investments, which
include real estate operations, a 22.1 percent equity investment
in a financial guaranty reinsurance company, and a securities
portfolio. As of December 31, 1995, the Company and its
subsidiaries had approximately 5,600 employees.
Summary of Earnings Per Share
Year Ended December 31,
------------------------
1993 1994 1995
---- ---- ----
Consolidated Earnings Per Share
Continuing Operations $ 2.27 $ 1.99 $ 2.06
Discontinued Operations (*) (.07) .07 .10
------ ------ ------
Total $ 2.20 $ 2.06 $ 2.16
====== ====== ======
Percentage of Earnings by Business Segment
Continuing Operations
Electric Operations 63% 63% 61%
Water Operations 4 23 (2)
Automobile Auctions - - 0
Investments 36 11 36
Discontinued Operations(*) (3) 3 5
---- ---- ----
100% 100% 100%
==== ==== ====
_______________
(*) On June 30,1995, the Company sold its interest in its paper
and pulp business to Consolidated Papers, Inc. ("CPI") for
$118 million in cash, plus CPI's assumption of certain debt
and lease obligations. The Company is still committed
to a maximum guarantee of $90 million to ensure a portion
of a $33.4 million annual lease obligation for paper
mill equipment under an operating lease extending to
2012. CPI has agreed to indemnify the Company for any
payments the Company may make as a result of the Company's
obligation relating to this operating lease.
Electric Operations
Electric operations generate, transmit, distribute and sell
electricity. The Company provides electricity to 122,000 customers in
northern Minnesota, while the Company's wholly owned subsidiary,
Superior Water, Light and Power Company, sells electricity to 14,000
customers and natural gas to 11,000 customers, and provides water to
10,000 customers in northwestern Wisconsin. Another wholly owned
subsidiary, BNI Coal, Ltd. ("BNI Coal") owns and operates a lignite
mine in North Dakota. Two electric generating cooperatives, Minnkota
Power Cooperative, Inc. and Square Butte Electric Cooperative ("Square
Butte"), presently consume virtually all of BNI Coal's production of
lignite coal under coal supply agreements extending to 2027. Under an
agreement with Square Butte, the Company purchases 71 percent of the
output from the Square Butte unit which is capable of generating up to
470 megawatts.
In 1995 large industrial customers contributed about half of the
Company's electric operating revenue. The Company has large power
contracts to sell power to eleven industrial customers (five taconite
producers, five paper companies and a pipeline company) each requiring
10 megawatts or more of power. These contracts, which have
termination dates ranging from April 1997 to December 2005, require
the payment of minimum monthly demand charges that cover most of the
fixed costs, including a return on common equity, associated with
having the capacity available to serve these customers.
Water Operations
Water operations include Southern States Utilities, Inc. ("SSU")
and Heater Utilities, Inc. ("Heater"), both wholly owned subsidiaries
of the Company. SSU is the largest private water supplier in Florida.
At December 31, 1995, SSU provided water to 117,000 customers and
wastewater treatment services to 53,000 customers in Florida. At
December 31, 1995, Heater provided water to 26,000 customers and
wastewater treatment services to 3,000 customers in North Carolina and
South Carolina. These water operations have been upgrading existing
facilities and building new facilities.
Responding to a Florida Supreme Court decision addressing the
issue of retroactive ratemaking with respect to another company, on
March 5, 1996, the Florida Public Service Commission ("FPSC") voted to
reconsider an October 1995 order (the "Refund Order") which would have
required SSU to refund about $10 million, including interest, to
customers who paid more since October 1993 under uniform rates than
they would have paid under stand alone rates. Under the Refund Order,
the collection of the $10 million from customers who paid less under
uniform rates would not be permitted. The Refund Order was in
response to the Florida First District Court of Appeals reversal in
April 1995 of the 1993 FPSC order which approved uniform rates for
most of SSU's service areas in Florida. With "uniform rates," all
customers in the uniform rate areas pay the same rates for water and
wastewater services. Uniform rates are an alternative to "stand-
alone" rates which are calculated based on the cost of serving each
service area. The FPSC will reconsider the Refund Order at an
undetermined date. SSU continues to believe that it would be improper
for the FPSC to order a refund to one group of customers without
permitting recovery of a similar amount from the remaining customers
since the First District Court of Appeals affirmed SSU's total revenue
requirement for operations in Florida. No provision for refund has
been recorded.
In June 1995 SSU filed a request with the FPSC for an $18.6
million annual increase in water and wastewater treatment rates. On
November 1, 1995, the FPSC denied the Company's original $12 million
interim rate request for two reasons: (1) it was based on uniform
rates which were deemed improper by a court order subsequent to the
Company's original filing, and (2) the FPSC had not yet formulated a
policy on allowable investments and expenses to be included in a
forward-looking interim test year. The Company submitted additional
information to support interim rate approval of $12 million based on a
forward-looking test year and $8.4 million based on a historical test
year. On January 4, 1996, the FPSC permitted the Company to implement
an interim rate increase (based on a historical test year) of $7.9
million, on an annualized basis, over revenue previously collected
under a uniform rate structure. Interim rates went into effect on
January 23, 1996. Final rates are anticipated to become effective in
the fourth quarter of 1996.
Automobile Auctions
The Company has an 83 percent ownership interest in ADESA
Corporation ("ADESA"), the third largest automobile auction business
in the United States. ADESA, headquartered in Indianapolis, Indiana,
owns and operates 19 automobile auctions in the United States and
Canada through which used cars and other vehicles are sold to
franchised automobile dealers and licensed used car dealers. Two
wholly owned subsidiaries of ADESA, Automotive Finance Company and
ADESA Auto Transport, perform related services. Sellers at ADESA's
auctions include domestic and foreign auto manufacturers, car dealers,
fleet/lease companies, banks and finance companies.
The Company acquired 80 percent of ADESA on July 1, 1995, for
$167 million in cash. Proceeds from the sale of the paper and pulp
business combined with proceeds from the sale of securities
investments were used to fund this acquisition. Acquired goodwill and
other intangible assets associated with this acquisition are being
amortized on a straight line basis over periods not exceeding 40
years. In January 1996 the Company provided an additional $15 million
of capital in exchange for 1,982,346 original issue common stock
shares of ADESA. This capital contribution increased the Company's
ownership interest in ADESA to 83 percent. Put and call agreements
with ADESA's four top managers provide ADESA management the right to
sell to the Company, and the Company the right to purchase, ADESA
management's 17 percent retained ownership interest in ADESA, in
increments during the years 1997, 1998 and 1999, at a price based on
ADESA's financial performance.
Investments
The Company owns 80 percent of Lehigh Acquisition Corporation, a
real estate company which owns various real estate properties and
operations in Florida.
The Company has a 22.1 percent equity investment in Capital Re
Corporation ("Capital Re"). Capital Re is a Delaware holding company
engaged primarily in financial and mortgage guaranty reinsurance
through its wholly owned subsidiaries, Capital Reinsurance Company and
Capital Mortgage Reinsurance Company. Capital Reinsurance Company is
a reinsurer of financial guarantees of municipal and non-municipal
debt obligations. Capital Mortgage Reinsurance Company is a reinsurer
of residential mortgage guaranty insurance. The Company's equity
investment in Capital Re at December 31, 1995, was $93 million.
As of December 31, 1995, the Company had approximately $106
million invested in a securities portfolio. The majority of the
securities are investment grade stocks of other utility companies and
are considered by the Company to be conservative investments.
Additionally, the Company sells common stock securities short and
enters into short sales of treasury futures contracts as part of an
overall investment portfolio hedge strategy.
MP&L CAPITAL
MP&L Capital is a statutory business trust created under Delaware
law pursuant to (i) a trust agreement executed by the Company, as
depositor for MP&L Capital, the Property Trustee, the Delaware Trustee
(each as defined herein) and an Administrative Trustee, an employee of
the Company (together with such other Administrative Trussees from
time to time appointed by the Company, the "Administrative Trustees")
of such trust (the "Original Trust Agreement") and (ii) the filing
of a certificate of trust with the Delaware Secretary of State on
February 15, 1996. Such trust agreement will be amended and restated
in its entirety (as so amended and restated, the "Trust Agreement")
substantially in the form filed as an exhibit to the Registration
Statement of which this Prospectus forms a part. The Trust
Agreement will be qualified as an indenture under the Trust Indenture
Act. MP&L Capital exists for the exclusive purposes of (i)
issuing Trust Securities representing undivided beneficial
interests in the assets of MP&L Capital, (ii) holding the Junior
Subordinated Debentures as trust assets and (iii) engaging in
only those other activities necessary or incidental thereto.
All of the Common Securities will be owned by the Company. The
Common Securities will rank pari passu, and payments will be made
thereon pro rata, with the Preferred Securities, except that upon the
occurrence and continuance of a default under the Indenture, the
rights of the Holder of the Common Securities to payment in respect of
Distributions and payments upon liquidation, redemption and otherwise
will be subordinated to the rights of the Holders of the Preferred
Securities. The Company will acquire Common Securities having an
aggregate liquidation preference amount equal to 3% of the total
capital of MP&L Capital. MP&L Capital has a term of approximately
years, but may terminate earlier as provided in the Trust Agreement.
MP&L Capital's business and affairs will be conducted by the
Administrative Trustees. The office of the Delaware Trustee in the
State of Delaware is White Clay Center, Route 273, Newark, Delaware
19711. The principal place of business of MP&L Capital is c/o
Minnesota Power & Light Company, 30 West Superior Street, Duluth,
Minnesota 55802.
MINNESOTA POWER & LIGHT COMPANY
SUMMARY FINANCIAL INFORMATION
Historical
------------------------
Year Ended December 31,
1993 1994 1995
---- ---- ----
(In thousands except
per share amounts)
INCOME STATEMENT DATA:
Operating revenue and income $582,495 $582,167 $672,917
Income
Continuing operations $ 64,374 $ 59,465 $ 61,857
Discontinued operations (1,753) 1,868 2,848
-------- -------- --------
Net Income $ 62,621 $ 61,333 $ 64,705
Earnings per share
of common stock
Continuing operations $ 2.27 $ 1.99 $ 2.06
Discontinued operations (.07) $ .07 $ .10
------ ------ ------
Total $ 2.20 $ 2.06 $ 2.16
Pro Forma(1)
-----------------------
Year Ended December 31,
1994 1995
---- ----
(In thousands except
per share amounts)
INCOME STATEMENT DATA:
Operating revenue and income $674,696 $729,674
Income
Continuing operations $ 61,771 $ 61,422
Discontinued operations $ 1,868 $ 2,848
-------- --------
Net Income $ 63,639 $ 64,270
Earnings per share
of common stock
Continuing operations $ 2.07 $ 2.04
Discontinued operations $ .07 $ .10
------ ------
Total $ 2.14 $ 2.14
December 31, 1995 Percent
----------------- -------
(In thousands)
BALANCE SHEET DATA:
Common stock equity $ 584,072 46%
Preferred stock not subject
to mandatory redemption 28,547 2
Preferred stock subject
to mandatory redemption 20,000 2
Long-term debt
(excluding current maturities) $ 639,548 50
---------- ----
Total capitalization $1,272,167 100%
Ratios of Earnings to Fixed Charges (2)
Year Ended December 31,
--------------------------------------------
1991 1992 1993 1994 1995
---- ---- ---- ---- ----
Ratios of
Earnings
to Fixed Charges 2.55 2.60 2.52 2.17 1.90
Supplemental Ratios of Earnings to Fixed Charges (2)(3)
Year Ended December 31,
--------------------------------------------
1991 1992 1993 1994 1995
---- ---- ---- ---- ----
Supplemental
Ratios of
Earnings
to Fixed Charges 2.20 2.25 2.19 1.95 1.73
Ratios of Earnings to Fixed Charges and Preferred Dividends (2)
Year Ended December 31,
--------------------------------------------
1991 1992 1993 1994 1995
---- ---- ---- ---- ----
Ratios of
Earnings
to Fixed Charges
and Preferred
Dividends 2.32 2.38 2.32 2.03 1.76
Supplemental Ratios of Earnings to Fixed Charges and
Preferred Dividends (2)(3)
Year Ended December 31,
--------------------------------------------
1991 1992 1993 1994 1995
---- ---- ---- ---- ----
Supplemental
Ratios of
Earnings
to Fixed Charges
and Preferred
Dividends 2.04 2.10 2.05 1.84 1.63
---------------
(1) Presents unaudited pro forma consolidated results as if ADESA was
acquired on January 1, 1994. See Note 3 to the Company's
Consolidated Financial Statements in the Company's Form 8-K dated
February 16, 1996, incorporated herein by reference.
(2) Ratios for prior periods have been restated to reflect
discontinued operations.
(3) The supplemental ratio of earnings to fixed charges includes the
Company's obligation under a contract with Square Butte which
extends through 2007, pursuant to which the Company is purchasing
71 percent of the output of a generating unit capable of
generating up to 470 megawatts. The Company is obligated to
pay Square Butte all of Square Butte's leasing, operating
and debt service costs (less any amounts collected from
the sale of power or energy to others) that shall not have been
paid by Square Butte when due. See Note 12 to the Company's
Consolidated Financial Statements in the Company's Form 8-K
dated February 16, 1996, incorporated herein by reference.
USE OF PROCEEDS
The proceeds to be received by MP&L Capital from the sale of the
Preferred Securities will be used to purchase Junior Subordinated
Debentures of the Company. The proceeds of such purchase will be
applied by the Company for general corporate purposes, which may
include the acquisition of outstanding securities of the Company.
DESCRIPTION OF THE PREFERRED SECURITIES
MP&L Capital was authorized and created by the Original Trust
Agreement. The Preferred Securities and the Common Securities will be
created pursuant to the terms of the Trust Agreement. The Preferred
Securities will represent undivided beneficial interests in the assets
of MP&L Capital and entitle the Holders thereof to a preference over
the Common Securities in certain circumstances with respect to
Distributions and amounts payable on redemption or liquidation, as
well as other benefits as described in the Trust Agreement. The
following summaries of certain provisions of the Trust Agreement do
not purport to be complete and are subject to, and are qualified in
their entirety by reference to, the provisions of the Trust Agreement,
including the definitions therein of certain terms, and the Trust
Indenture Act. Wherever particular sections or defined terms of the
Trust Agreement are referred to, such sections or defined terms are
incorporated herein by reference. The Trust Agreement has been filed
as an exhibit to the Registration Statement of which this Prospectus
forms a part.
General
All of the Common Securities are owned by the Company. The
Common Securities will rank pari passu, and payments will be made
thereon pro rata, with the Preferred Securities based on the
liquidation preference amount of the Trust Securities, except as
described under "Subordination of Common Securities." (Section 4.03).
The Junior Subordinated Debentures will be owned by MP&L Capital and
held by the Property Trustee in trust for the benefit of the Holders
of the Trust Securities. (Section 2.09). The Guarantee is a full and
unconditional guarantee with respect to the Preferred Securities but
does not guarantee payment of Distributions or amounts payable on
redemption or liquidation of the Preferred Securities when MP&L
Capital does not have funds available to make such payments.
Distributions
The Distributions payable on the Preferred Securities will be
fixed at a rate per annum of % of the stated liquidation
preference amount thereof. The term "Distributions" as used herein
includes interest payable on overdue Distributions, unless otherwise
stated. The amount of Distributions payable for any period will be
computed on the basis of a 360-day year of twelve 30-day months and
for any period shorter than a full month, on the basis of the actual
number of days elapsed. (Section 4.01(b)). Distributions that are in
arrears will bear interest on the amount thereof at the per annum rate
of % (to the extent permitted by applicable law, compounded
quarterly).
Distributions on the Preferred Securities will be cumulative,
will accrue from the date of initial issuance thereof, and will be
payable quarterly in arrears, on March 31, June 30, September 30 and
December 31 of each year, commencing , 1996, except as
otherwise described below. Such Distributions will originally accrue
from, and include, the date of initial issuance and will accrue to,
and include, the first distribution payment date, and thereafter will
accrue from, and exclude, the last distribution payment date through
which Distributions have been paid. In the event that any date on
which Distributions are otherwise payable on the Preferred Securities
is not a Business Day, payment of the distribution payable on such
date will be made on the next succeeding Business Day (and without any
interest or other payment in respect of any such delay) except that,
if such Business Day is in the next succeeding calendar year, payment
of such distribution shall be made on the immediately preceding
Business Day, in each case with the same force and effect as if made
on such date (each date on which Distributions are otherwise payable
in accordance with the foregoing, a distribution payment date).
(Section 4.01(a)). A Business Day is used herein to mean any day
other than a Saturday or a Sunday or a day on which banking
institutions in The City of New York are authorized or required by law
or executive order to remain closed or a day on which the Corporate
Trust Office of the Property Trustee or the Debenture Trustee (as
defined herein) is closed for business.
The Company has the right under the Indenture pursuant to which
it will issue the Junior Subordinated Debentures to extend the
interest payment period at any time or from time to time on the Junior
Subordinated Debentures to a period not exceeding 20 consecutive
quarters, with the consequence that quarterly Distributions on the
Preferred Securities would be deferred (but would continue to accrue
with interest payable on unpaid Distributions at the rate per annum
set forth above, compounded quarterly) by MP&L Capital during any such
Extension Period. In the event that the Company exercises this right,
during such period the Company may not (i) declare or pay dividends or
distributions (other than dividends or distributions in Common Stock
of the Company) on, or redeem, purchase, acquire, or make a
liquidation payment with respect to any of its capital stock, or (ii)
make any payment of principal of, interest or premium, if any, on, or
repay, repurchase or redeem any indebtedness that is pari passu with
the Junior Subordinated Debentures (including other Debt Securities)
or make any guarantee payment with respect to the foregoing. Prior to
the termination of any such Extension Period, the Company may further
extend the interest payment period, provided that such Extension
Period together with all such previous and further extensions thereof
may not exceed 20 consecutive quarters and that such Extension Period
may not extend beyond the maturity date of the Junior Subordinated
Debentures. Any Extension Period with respect to payment of interest
on the Junior Subordinated Debentures, other Debt Securities or on any
similar securities will apply to all such securities and will also
apply to Distributions with respect to the Preferred Securities and
all other securities with terms substantially the same as the
Preferred Securities. Upon the termination of any Extension Period
and the payment of all amounts then due, the Company may select a new
extended interest payment period, subject to the foregoing
requirements. See "Description of the Junior Subordinated Debentures -
- Interest" and "-- Option to Extend Interest Payment Period."
It is anticipated that the income of MP&L Capital available for
distribution to the Holders of the Preferred Securities will be
limited to payments on the Junior Subordinated Debentures to be
purchased by MP&L Capital with the proceeds of the sale of the
Preferred Securities. See "Description of the Junior Subordinated
Debentures." If the Company does not make interest payments on the
Junior Subordinated Debentures, the Property Trustee will not have
funds available to pay Distributions on the Preferred Securities and
the Common Securities. The payment of Distributions (if and to the
extent MP&L Capital has sufficient funds available for the payment of
such Distributions) is guaranteed by the Company as set forth herein
under "Descriptions of the Guarantee."
Distributions on the Preferred Securities will be payable to the
Holders thereof as they appear on the register of MP&L Capital on the
relevant record dates, which as long as the Preferred Securities
remain in book-entry form, will be one Business Day prior to the
relevant Distribution Date. Subject to any applicable laws and
regulations and the Trust Agreement, each such payment will be made as
described under "-- Book-Entry Only Issuance - The Depository Trust
Company." In the event any Preferred Securities are not in book-entry
form, the relevant record date for such Preferred Securities shall be
the date 15 days prior to the relevant Distribution Date or if such
date is not a Business Day, the next succeeding Business Day.
(Section 4.01(d)).
Redemption
The Junior Subordinated Debentures will mature on
, and the Company has the right to redeem the Junior Subordinated
Debentures (a) in whole or in part, on or after , or (b)
at any time, in whole but not in part, upon the occurrence of a Tax
Event or an Investment Company Event (each, as defined below, a
"Special Event"), subject to the conditions described under
"Description of the Junior Subordinated Debentures -- Optional
Redemption."
Mandatory Redemption
Upon the repayment of the Junior Subordinated Debentures, whether
at maturity or upon earlier redemption as provided in the Indenture,
the proceeds from such repayment shall be applied by the Property
Trustee to redeem a Like Amount (as defined herein) of Trust
Securities, upon not less than 30 nor more than 60 days' notice, at
the Redemption Price. See "Description of the Junior Subordinated
Debentures -- Optional Redemption."
Special Event Redemption or Distribution
If a Special Event shall occur and be continuing with respect to
the Preferred Securities, the Company has the right to (i) redeem the
Junior Subordinated Debentures in whole, but not in part, and
therefore cause a mandatory redemption of all the Preferred Securities
at the Redemption Price within 90 days following the occurrence of
such Special Event, or (ii) cause the termination of MP&L Capital and
in connection therewith, after satisfaction of MP&L creditors, if any,
cause the Junior Subordinated Debentures to be distributed to the
Holders of the Trust Securities at the Redemption Price within 90 days
following the occurrence of such Special Event. If at any time MP&L
Capital is not or will not be taxed as a grantor trust but a Tax Event
has not occurred, the Company has the right to terminate MP&L Capital
and cause the Junior Subordinated Debentures to be distributed to the
holders of the Preferred Securities in liquidation of MP&L Capital.
See "Certain United States Federal Income Tax Consequences -- Receipt
of Junior Subordinated Debentures or Cash Upon Liquidation of MP&L
Capital." If the Company does not elect either option (i) or (ii)
above, the Preferred Securities will remain outstanding and, in the
event a Tax Event has occurred and is continuing, Additional Interest
(as defined below) will be payable on the Junior Subordinated
Debentures.
"Like Amount" means (i) with respect to a redemption of Trust
Securities, Preferred Securities and Common Securities, each in
amounts having a liquidation value equal to the proportion all such
securities have to the liquidation value of all the Trust Securities,
together having an aggregate liquidation value equal to the principal
amount of Junior Subordinated Debentures to be contemporaneously
redeemed in accordance with the Indenture, the proceeds of which are
to be used to pay the Redemption Price of such Trust Securities and
(ii) with respect to a distribution of Junior Subordinated Debentures
to Holders of Trust Securities in connection with a liquidation of
MP&L Capital upon the occurrence of a Special Event or the bankruptcy,
termination or liquidation of the Company or an order for judicial
termination of MP&L Capital having been entered by a court of
competent jurisdiction, Junior Subordinated Debentures having a
principal amount equal to the liquidation value of the Trust
Securities of the Holders to which such Junior Subordinated Debentures
are distributed.
"Tax Event" means the receipt by MP&L Capital of an opinion of
counsel (which may be counsel to the Company or an affiliate but not
an employee thereof and which must be acceptable to the Property
Trustee) experienced in such matters to the effect that, as a result
of any amendment to, or change (including any announced prospective
change) in, the laws (or any regulations thereunder) of the United
States or any political subdivision or taxing authority thereof or
therein affecting taxation, or as a result of any official
administrative or judicial decision interpreting or applying such laws
or regulations, which amendment or change is effective or such
pronouncement or decision is announced on or after the date of
original issuance of the Preferred Securities, there is more than an
insubstantial risk that (i) MP&L Capital is, or will be within 90 days
of the date thereof, subject to United States federal income tax with
respect to income received or accrued on the Junior Subordinated
Debentures, (ii) interest payable by the Company on the Junior
Subordinated Debentures, is not, or within 90 days of the date
thereof, will not be, deductible, in whole or in part, for United
States federal income tax purposes, or (iii) MP&L Capital is, or will
be within 90 days of the date thereof, subject to more than a de
minimis amount of other taxes, duties or other governmental charges.
"Investment Company Event" means the occurrence of a change in
law or regulation or a change in interpretation or application of law
or regulation by any legislative body, court, governmental agency or
regulatory authority ("Change in 1940 Act Law") to the effect that
MP&L Capital is or will be considered an "investment company" that is
required to be registered under the Investment Company Act of 1940, as
amended, which Change in 1940 Act Law becomes effective on or after
the date of original issuance of the Preferred Securities.
On December 7, 1995, the U.S. Treasury Department proposed
certain tax law changes that, among other things, would generally deny
interest deductions to corporate issuers of debt if the debt
instrument has a term exceeding 20 years and is not reflected as
indebtedness on the issuer's balance sheet. As described in the
Treasury Department's proposal, the proposed changes would not affect
the ability of the Company to deduct interest on the Junior
Subordinated Debentures, because the term of the Junior Subordinated
Debentures is _____ years. However, there can be no assurance that
subsequent proposals or final legislation will not affect the ability
of the Company to deduct interest on the Junior Subordinated
Debentures, which in turn could give rise to a Tax Event. Accordingly,
there can be no assurance that a Special Event will not occur.
On the date fixed for any distribution of Junior Subordinated
Debentures, upon termination of MP&L Capital (i) the Preferred
Securities and the Common Securities will no longer be deemed to be
outstanding, (ii) DTC or its nominee, as the record holder of such
Preferred Securities, will receive a registered global certificate or
certificates representing the Junior Subordinated Debentures to be
delivered upon such distribution and (iii) certificates representing
Preferred Securities will be deemed to represent Junior Subordinated
Debentures having an aggregate principal amount equal to the stated
liquidation preference amount of, and bearing accrued and unpaid
interest equal to accrued and unpaid Distributions on, such Preferred
Securities until such certificates are presented to the Company or its
agent for transfer or reissuance.
There can be no assurance as to the market price for the Junior
Subordinated Debentures which may be distributed in exchange for
Preferred Securities if a termination and liquidation of MP&L Capital
were to occur. Accordingly, the Junior Subordinated Debentures which
an investor may subsequently receive on termination and liquidation of
MP&L Capital, may trade at a discount to the price of the Preferred
Securities exchanged. If the Junior Subordinated Debentures are
distributed to the Holders of Preferred Securities upon the
dissolution of MP&L Capital, the Company will use its best efforts to
list the Junior Subordinated Debentures on the NYSE or on such other
exchange on which the Preferred Securities are then listed.
Redemption Procedures
The Company may not redeem fewer than all the Junior Subordinated
Debentures and MP&L Capital may not redeem fewer than all the
outstanding Preferred Securities unless all accrued and unpaid
Distributions have been paid on all Preferred Securities for all
quarterly distribution periods terminating on or prior to the date of
redemption or if a partial redemption of the Preferred Securities
would result in the delisting of the Preferred Securities by any
national securities exchange on which the Preferred Securities are
then listed.
Preferred Securities redeemed on each Redemption Date shall be
redeemed at the Redemption Price with the proceeds from the
contemporaneous redemption of Junior Subordinated Debentures.
Redemptions of the Preferred Securities shall be made and the
Redemption Price shall be deemed payable on each date selected for
redemption (the "Redemption Date") only to the extent that MP&L
Capital has funds available for the payment of such Redemption Price.
(Section 4.02(c)). See also "Subordination of Common Securities."
If MP&L Capital gives a notice of redemption in respect of
Preferred Securities (which notice will be irrevocable), then, on or
before the Redemption Date, MP&L Capital will irrevocably deposit with
DTC funds sufficient to pay the applicable Redemption Price and will
give DTC irrevocable instructions and authority to pay the Redemption
Price to the beneficial holders of such Preferred Securities. If such
Preferred Securities are no longer in book-entry form, MP&L Capital,
to the extent funds are available, will irrevocably deposit with the
paying agent for such Preferred Securities funds sufficient to pay the
applicable Redemption Price and will give such paying agent
irrevocable instructions and authority to pay the Redemption Price to
the Holders thereof upon surrender of their certificates evidencing
such Preferred Securities. Notwithstanding the foregoing,
Distributions payable on or prior to the Redemption Date for any
Preferred Securities called for redemption shall be payable to the
Holders of such Preferred Securities on the relevant record dates for
the related distribution payment dates. If notice of redemption shall
have been given and funds deposited as required, then on the
Redemption Date, all rights of Holders of such Preferred Securities so
called for redemption will cease, except the right of the Holders of
such Preferred Securities to receive the Redemption Price, but without
interest thereon, and such Preferred Securities will cease to be
outstanding. In the event that any date fixed for redemption of
Preferred Securities is not a Business Day, then payment of the amount
payable on such date will be made on the next succeeding day which is
a Business Day (and without any interest or other payment in respect
of any such delay). In the event that payment of the Redemption Price
in respect of Preferred Securities called for redemption is improperly
withheld or refused and not paid either by MP&L Capital or by the
Company pursuant to the Guarantee described herein under "Description
of the Guarantee", Distributions on such Preferred Securities will
continue to accrue at the then applicable rate, from the original
Redemption Date to the date of payment, in which case the actual
payment date will be considered the date fixed for redemption for
purposes of calculating the Redemption Price.
Subject to applicable law (including, without limitation, United
States federal securities law), the Company may at any time and from
time to time purchase outstanding Preferred Securities by tender, in
the open market or by private agreement.
If less than all the Trust Securities are to be redeemed on a
Redemption Date, then the aggregate liquidation preference of such
securities to be redeemed shall be allocated on a pro rata basis to
the Common Securities and the Preferred Securities. The particular
Preferred Securities to be redeemed shall be selected not more than 60
days prior to the Redemption Date by the Property Trustee from the
outstanding Preferred Securities not previously called for redemption,
by such method as the Property Trustee shall deem fair and appropriate
and which may provide for the selection for redemption of Preferred
Securities in liquidation preference amounts equal to $25 or integral
multiples thereof. The Property Trustee shall promptly notify the
security registrar in writing of the Preferred Securities selected for
redemption and, in the case of any Preferred Securities selected for
partial redemption, the liquidation preference amount thereof to be
redeemed. For all purposes of the Trust Agreement, unless the context
otherwise requires, all provisions relating to the redemption of
Preferred Securities shall relate, in the case of any Preferred
Securities redeemed or to be redeemed only in part, to the portion of
the liquidation preference amount of Preferred Securities that has
been or is to be redeemed. (Section 4.02(f)).
Subordination of Common Securities
Payment of Distributions on, and the Redemption Price of, the
Trust Securities, shall be made pro rata based on the Liquidation
Amount of the Trust Securities; provided, however, that if on any
distribution payment date or Redemption Date an Event of Default under
the Indenture (as described below, see "Events of Default; Notice")
under the Trust Agreement shall have occurred and be continuing, no
payment of any Distribution on, or Redemption Price of, any Common
Security, and no other payment on account of the redemption,
liquidation or other acquisition of Common Securities, shall be made
unless payment in full in cash of all accrued and unpaid Distributions
on all outstanding Preferred Securities for all distribution periods
terminating on or prior thereto, or in the case of payment of the
Redemption Price, the full amount of such Redemption Price on all
outstanding Preferred Securities, shall have been made or provided
for, and all funds available to the Property Trustee shall first be
applied to the payment in full, in cash, of all Distributions on, or
Redemption Price of, Preferred Securities then due and payable.
(Section 4.03(a)).
In the case of any default under the Trust Agreement resulting
from an Event of Default under the Indenture, the Company as Holder of
the Common Securities will be deemed to have waived any such default
under the Trust Agreement until the effect of all such Defaults with
respect to the Preferred Securities have been cured, waived or
otherwise eliminated. Until any such default under such Trust
Agreement with respect to the Preferred Securities has been so cured,
waived or otherwise eliminated, the Property Trustee shall act solely
on behalf of the Holders of the Preferred Securities and not the
Holders of the Common Securities, and only Holders of Preferred
Securities will have the right to direct the Property Trustee to act
on their behalf. (Section 4.03(b)).
Liquidation Distribution upon Termination
Pursuant to the Trust Agreement, MP&L Capital shall terminate and
shall be liquidated by the Property Trustee on the first to occur of:
(i) December 31, , the expiration of the term of MP&L Capital;
(ii) the bankruptcy, dissolution or liquidation of the Company; (iii)
the redemption of all of the Preferred Securities, (iv) the
termination and liquidation of MP&L Capital upon (a) the occurrence of
a Special Event or (b) in the event MP&L Capital is not or will not be
taxed as a grantor trust under the United States federal income tax
law, but a Tax Event has not occurred, and, in either such case, the
Company as Depositor has given written direction to the Property
Trustee to terminate MP&L Capital within 90 days of such event (which
direction is optional and wholly within the discretion of the Company
as Depositor) and (v) an order for judicial termination of MP&L
Capital having been entered by a court of competent jurisdiction.
(Sections 9.01 and 9.02).
If an early termination occurs as described in clause (ii),
(iii), (iv) or (v) above, MP&L Capital shall be liquidated by the
Property Trustee as expeditiously as the Property Trustee determines
to be appropriate by adequately providing for the satisfaction of
liabilities of creditors, if any, and by distributing to each Holder
of Preferred Securities and Common Securities a Like Amount of Junior
Subordinated Debentures, unless such distribution is determined by the
Property Trustee not to be practical, in which event such Holders will
be entitled to receive, out of the assets of MP&L Capital available
for distribution to Holders after adequate provision, as determined by
the Property Trustee, has been made for the satisfaction of
liabilities of creditors, if any, an amount equal to, in the case of
Holders of Preferred Securities, the aggregate liquidation preference
of the Preferred Securities plus accrued and unpaid Distributions
thereon to the date of payment (such amount being the "Liquidation
Distribution"). If such Liquidation Distribution can be paid only in
part because MP&L Capital has insufficient assets available to pay in
full the aggregate Liquidation Distribution, then the amounts payable
directly by MP&L Capital on the Preferred Securities shall be paid on
a pro rata basis. The Company, as Holder of the Common Securities,
will be entitled to receive Distributions upon any such termination
pro rata with the Holders of the Preferred Securities, except that if
default has occurred and is continuing under the Indenture, the
Preferred Securities shall have a preference over the Common
Securities. (Sections 9.04(a) and 9.04(d)). If an early termination
occurs as described in clause (v) above, the Junior Subordinated
Debentures will be subject to optional redemption in whole but not in
part.
Events of Default; Notice
Any one of the following events constitutes an Event of Default
under the Trust Agreement (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment, decree or
order of any court or any order, rule or regulation of any
administrative or governmental body):
(i) the occurrence of an Event of Default as defined in
Section 801 of the Indenture (see "Description of the Junior
Subordinated Debentures -- Events of Default"); or
(ii) default by MP&L Capital in the payment of any
distribution when it becomes due and payable, and continuation of
such default for a period of 30 days; or
(iii) default by MP&L Capital in the payment of any
Redemption Price, of any Trust Security when it becomes due and
payable; or
(iv) default in the performance, or breach, in any material
respect, of any covenant or warranty of the Trustees in the Trust
Agreement (other than a covenant or warranty a default in the
performance of which or the breach of which is specifically dealt
with in clause (ii) or (iii) above), and continuation of such
default or breach for a period of 60 days after there has been
given, by registered or certified mail, to the Property Trustee
by the Holders of Preferred Securities having at least 10% of the
total liquidation preference amount of the outstanding Preferred
Securities, a written notice specifying such default or breach
and requiring it to be remedied and stating that such notice is a
Notice of Default thereunder; or
(v) the occurrence of certain events of bankruptcy or
insolvency with respect to MP&L Capital;
Within five Business Days after the occurrence of any Event of
Default, the Property Trustee shall transmit to the Holders of Trust
Securities and the Company notice of any such Event of Default
actually known to the Property Trustee, unless such Event of Default
shall have been cured or waived.
Merger or Consolidation of the Property Trustee or the Delaware
Trustee
Any entity into which the Property Trustee or the Delaware
Trustee may be merged or with which it may be consolidated, or any
entity resulting from any merger, conversion or consolidation to which
the Property Trustee or the Delaware Trustee shall be a party, or any
entity succeeding to all or substantially all the corporate trust
business of the Property Trustee or the Delaware Trustee, shall be the
successor to the Property Trustee or the Delaware Trustee under the
Trust Agreement, provided such entity shall be otherwise qualified and
eligible. (Section 8.12).
Book-Entry Only Issuance -- The Depository Trust Company
The Depository Trust Company (the "DTC") will act as securities
depositary for all of the Preferred Securities. The Preferred
Securities will be issued only as fully-registered securities
registered in the name of Cede & Co. ("DTC's nominee"). One or more
fully-registered global Preferred Securities certificates,
representing the aggregate number of Preferred Securities, will be
issued and will be deposited with DTC.
DTC is a limited-purpose trust company organized under the New
York Banking Law, a "banking organization" within the meaning of the
New York Banking Law, a member of the Federal Reserve System, a
"clearing corporation" within the meaning of the New York Uniform
Commercial Code and a "clearing agency" registered pursuant to the
provisions of Section 17A of the 1934 Act. DTC holds securities that
its participants ("Participants") deposit with DTC. DTC also
facilitates the settlement among Participants of securities
transactions, such as transfers and pledges, in deposited securities
through electronic computerized book-entry changes in Participants'
accounts, thereby eliminating the need for physical movement of
securities certificates. Direct Participants include securities
brokers and dealers, banks, trust companies, clearing corporations and
certain other organizations ("Direct Participants"). DTC is owned by
a number of its Direct Participants and by the New York Stock
Exchange, the American Stock Exchange, Inc., and the National
Association of Securities Dealers, Inc. Access to the DTC system is
also available to others, such as securities brokers and dealers,
banks and trust companies that clear transactions through or maintain
a direct or indirect custodial relationship with a Direct Participant
("Indirect Participants"). The rules applicable to DTC and its Direct
Participants and Indirect Participants are on file with the
Commission.
Purchases of Preferred Securities within the DTC system must be
made by or through Direct Participants, which will receive a credit
for the Preferred Securities on DTC's records. The ownership interest
of each actual purchaser of each Preferred Security (the "Beneficial
Owner") is in turn to be recorded on the Participants' records.
Beneficial Owners will not receive written confirmation from DTC of
their purchases, but Beneficial Owners are expected to receive written
confirmations providing details of the transactions, as well as
periodic statements of their holdings, from the Participants through
which the Beneficial Owners purchased Preferred Securities. Transfers
of ownership interests in the Preferred Securities are to be
accomplished by entries made on the books of Participants acting on
behalf of Beneficial Owners. Beneficial Owners will not receive
certificates representing their ownership interests in the Preferred
Securities, except in the event that use of the book-entry system for
the Preferred Securities is discontinued.
To facilitate subsequent transfers, all the Preferred Securities
deposited by Direct Participants with DTC are registered in the name
of DTC's nominee, Cede & Co. The deposit of Preferred Securities with
DTC and their registration in the name of Cede & Co. effect no change
in beneficial ownership. DTC has no knowledge of the actual
Beneficial Owners of the Preferred Securities; DTC's records reflect
only the identity of the Direct Participants to whose accounts such
Preferred Securities are credited, which may or may not be the
Beneficial Owners. The Participants will remain responsible for
keeping account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants and by
Participants to Beneficial Owners will be governed by arrangements
among them, subject to any statutory or regulatory requirements that
may be in effect from time to time.
Redemption notices shall be sent to Cede & Co. as the registered
Holder of Preferred Securities. If less than all of the Preferred
Securities are being redeemed, DTC's current practice is to determine
by lot the amount of the interest of each Direct Participant in such
issue to be redeemed.
Although voting with respect to the Preferred Securities is
limited, in those cases where a vote is required, neither DTC nor Cede
& Co. will itself consent or vote with respect to Preferred
Securities. Under its usual procedures, DTC would mail an Omnibus
Proxy to MP&L Capital as soon as possible after the record date. The
Omnibus Proxy assigns Cede & Co. consenting or voting rights to those
Direct Participants to whose accounts the Preferred Securities are
credited on the record date (identified in a listing attached to the
Omnibus Proxy). The Company and MP&L Capital believe that the
arrangements among DTC, Direct and Indirect Participants, and
Beneficial Owners will enable the Beneficial Owners to exercise rights
equivalent in substance to the rights that can be directly exercised
by a holder of a beneficial interest in MP&L Capital.
Distribution payments on the Preferred Securities will be made to
DTC. DTC's practice is to credit Direct Participants' accounts on the
relevant payment date in accordance with their respective holdings
shown on DTC's records unless DTC has reason to believe that it will
not receive payments on such payment date. Payments by Participants
to Beneficial Owners will be governed by standing instructions and
customary practices, as is the case with securities held for the
account of customers in bearer form or registered in "street name,"
and such payments will be the responsibility of such Participant and
not of DTC, the Property Trustee, MP&L Capital or the Company, subject
to any statutory or regulatory requirements to the contrary that may
be in effect from time to time. Payment of Distributions to DTC is
the responsibility of MP&L Capital, disbursement of such payments to
Direct Participants is the responsibility of DTC, and disbursement of
such payments to the Beneficial Owners is the responsibility of
Participants.
Except as provided herein, a Beneficial Owner will not be
entitled to receive physical delivery of Preferred Securities.
Accordingly, each Beneficial Owner must rely on the procedures of DTC
to exercise any rights under the Preferred Securities.
DTC may discontinue providing its services as securities
depositary with respect to the Preferred Securities at any time by
giving reasonable notice to MP&L Capital and the Company. Under such
circumstances, in the event that a successor securities depositary is
not obtained, Preferred Securities certificates are required to be
printed and delivered. Additionally, the Administrative Trustees
(with the consent of the Company) may decide to discontinue use of the
system of book-entry transfers through DTC (or any successor
depositary) with respect to the Preferred Securities. In that event,
certificates for the Preferred Securities will be printed and
delivered.
The information in this section concerning DTC and DTC's book-
entry system has been obtained from sources that the Company and MP&L
Capital believe to be reliable, but neither the Company nor MP&L
Capital takes responsibility for the accuracy thereof.
Voting Rights
Holders of Trust Securities shall be entitled to one vote for
each $25 in liquidation preferences represented by their Trust
Securities in respect of any matter as to which such Holders of Trust
Securities are entitled to vote. Except as described below and under
"-- Amendments," and under "Description of the Guarantee -- Amendments
and Assignment" and as otherwise required by law and the Trust
Agreement, the Holders of the Preferred Securities will have no voting
rights. (Section 6.01(a)).
So long as any Junior Subordinated Debentures are held by the
Property Trustee, the Property Trustee shall not (i) direct the time,
method and place of conducting any proceeding for any remedy available
to the Debenture Trustee, or executing any trust or power conferred on
the Debenture Trustee with respect to the Junior Subordinated
Debentures, (ii) waive any past default which is waivable under
Section 813 of the Indenture, (iii) exercise any right to rescind or
annul a declaration that the principal of all the Junior Subordinated
Debentures shall be due and payable or (iv) consent to any amendment,
modification or termination of the Indenture or the Junior
Subordinated Debentures, where such consent shall be required,
without, in each case, obtaining the prior approval of the Holders of
Preferred Securities having of at least 66 2/3% of the liquidation
preference amount of the outstanding Preferred Securities; provided,
however, that where a consent under the Indenture would require the
consent of each Holder of Junior Subordinated Debentures affected
thereby, no such consent shall be given by the Property Trustee
without the prior consent of each Holder of Preferred Securities. The
Property Trustee shall not revoke any action previously authorized or
approved by a vote of the Preferred Securities. If the Property
Trustee fails to enforce its rights under the Junior Subordinated
Debentures or the Trust Agreement, a Holder of Preferred Securities
may institute a legal proceeding directly against the Company to
enforce the Property Trustee's rights under the Junior Subordinated
Debentures or the Trust Agreement, to the fullest extent permitted by
law, without first instituting any legal proceeding against the
Property Trustee or any other person or entity. The Property Trustee
shall notify all Holders of the Preferred Securities of any notice of
default received from the Debenture Trustee. In addition to obtaining
the foregoing approvals of the Holders of the Preferred Securities,
prior to taking any of the foregoing actions, the Property Trustee
shall receive an opinion of counsel experienced in such matters to the
effect that MP&L Capital will be classified as a "grantor trust" and
will not be classified as an association taxable as a corporation for
United States federal income tax purposes on account of such action.
(Section 6.01(b)).
Any required approval of Holders of Preferred Securities may be
given at a separate meeting of Holders of Preferred Securities
convened for such purpose or pursuant to written consent. The
Administrative Trustees will cause a notice of any meeting at which
Holders of Preferred Securities are entitled to vote, or of any matter
upon which action by written consent of such Holders is to be taken,
to be given to each Holder of Preferred Securities in the manner set
forth in the Trust Agreement. (Section 6.02).
No vote or consent of the Holders of Preferred Securities will be
required for MP&L Capital to redeem and cancel Preferred Securities in
accordance with the Trust Agreement.
Notwithstanding that Holders of Preferred Securities are entitled
to vote or consent under any of the circumstances described above, any
of the Preferred Securities that are owned by the Company, the
Property Trustee or any affiliate of the Company or the Property
Trustee, shall, for purposes of such vote or consent, be treated as if
they were not outstanding.
Amendments
The Trust Agreement may be amended from time to time by MP&L
Capital (on approval of a majority of the Administrative Trustees) and
the Company, without the consent of any Holders of Trust Securities,
(i) to cure any ambiguity, correct or supplement any provision therein
which may be inconsistent with any other provision therein, or to make
any other provisions with respect to matters or questions arising
under the Trust Agreement, which shall not be inconsistent with the
other provisions of the Trust Agreement, provided, however, that any
such amendment shall not adversely affect in any material respect the
interests of any Holder of Trust Securities or (ii) to modify,
eliminate or add to any provisions of the Trust Agreement to such
extent as shall be necessary to ensure that MP&L Capital will not be
classified for United States federal income tax purposes as an
association taxable as a corporation at any time that any Trust
Securities are outstanding or to ensure MP&L Capital's exemption from
the status of an "investment company" under the Investment Company Act
of 1940, as amended (the "1940 Act"); provided, however, that, except
in the case of clause (ii), such action shall not adversely affect in
any material respect the interests of any Holder of Trust Securities
and, in the case of clause (i), any amendments of the Trust Agreement
shall become effective when notice thereof is given to the Holders of
Trust Securities.
Except as provided below, any provision of the Trust Agreement
may be amended by the Trustees and the Company with (i) the consent of
Holders of Trust Securities representing not less than a majority in
liquidation preference of the Trust Securities then outstanding and
(ii) receipt by the Trustees of an opinion of counsel to the effect
that such amendment or the exercise of any power granted to the
Trustees in accordance with such amendment will not affect MP&L
Capital's status as a grantor trust for United States federal income
tax purposes or affect MP&L Capital's exemption from status of an
"investment company" under the 1940 Act.
Without the consent of each affected Holder of Trust Securities,
the Trust Agreement may not be amended to (i) change the amount or
timing of any distribution with respect to the Trust Securities or
otherwise adversely affect the amount of any distribution required to
be made in respect of the Trust Securities as of a specified date or
(ii) restrict the right of a Holder of Trust Securities to institute
suit for the enforcement of any such payment on or after such date.
Removal of Property Trustee
Unless an Event of Default under the Indenture shall have
occurred and be continuing, the Property Trustee may be removed at any
time by act of the Holder of the Common Securities. If an Event of
Default under the Indenture has occurred and is continuing, the
Property Trustee may be removed at such time by act of the Holders of
Preferred Securities having a majority of the liquidation preference
of the Preferred Securities. In no event will the Holders of the
Preferred Securities have the right to vote to appoint, remove or
replace the Administrative Trustees, which voting rights are vested
exclusively in the Company as the Holder of the Common Securities. No
resignation or removal of the Property Trustee and no appointment of a
successor trustee shall be effective until the acceptance of
appointment by the successor Property Trustee in accordance with the
provisions of the Trust Agreement. (Section 8.10).
Co-trustees and Separate Property Trustee
Unless an Event of Default under the Indenture shall have
occurred and be continuing, at any time or times, for the purpose of
meeting the legal requirements of the Trust Indenture Act or of any
jurisdiction in which any part of the Trust Property (as defined in
the Trust Agreement) may at the time be located, the Holder of the
Common Securities and the Property Trustee shall have power to
appoint, and upon the written request of the Property Trustee, the
Company, as Depositor, shall for such purpose join with the Property
Trustee in the execution, delivery and performance of all instruments
and agreements necessary or proper to appoint one or more persons
approved by the Property Trustee either to act as co-trustee, jointly
with the Property Trustee, of all or any part of such Trust 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 such capacity, any property,
title, right or power deemed necessary or desirable, subject to the
provisions of the Trust Agreement. If the Company, as Depositor, does
not join in such appointment within 15 days after the receipt by it of
a request so to do, or in case an Event of Default under the Indenture
has occurred and is continuing, the Property Trustee alone shall have
power to make such appointment. (Section 8.09).
Form, Exchange, and Transfer
Preferred Securities will be issuable only in fully registered
form each having a liquidation preference amount of $25 and any
integral multiple thereof.
At the option of the Holder, subject to the terms of the Trust
Agreement, Preferred Securities will be exchangeable for other
Preferred Securities, of any authorized denomination and of like tenor
and aggregate liquidation preference.
Subject to the terms of the Trust Agreement, Preferred Securities
may be presented for exchange as provided above or for registration of
transfer (duly endorsed or accompanied by a duly executed instrument
of transfer) at the office of the Transfer Agent designated for such
purpose. The Administrative Trustees may designate the Company as
Transfer Agent and as Registrar. No service charge will be made for
any registration of transfer or exchange of Preferred Securities, but
the Company may require payment of a sum sufficient to cover any tax
or other governmental charge payable in connection therewith. Such
transfer or exchange will be effected upon the Transfer Agent being
satisfied with the documents of title and identity of the person
making the request. The Administrative Trustees may at any time
designate additional Transfer Agents or rescind the designation of any
Transfer Agent or approve a change in the office through which any
Transfer Agent acts.
MP&L Capital will not be required to (i) issue, register the
transfer of, or exchange any Preferred Securities during a period
beginning at the opening of business 15 calendar days before the day
of mailing of a notice of redemption of any Preferred Securities
called for redemption and ending at the close of business on the day
of such mailing or (ii) register the transfer of or exchange any
Preferred Securities so selected for redemption, in whole or in part,
except the unredeemed portion of any such Preferred Securities being
redeemed in part.
Registrar and Transfer Agent
Initially, The Bank of New York will act as Registrar and
Transfer Agent for the Preferred Securities.
Registration of transfers of Preferred Securities will be
effected without charge by or on behalf of MP&L Capital, but upon
payment (with the giving of such indemnity as MP&L Capital or the
Company may require) in respect of any tax or other governmental
charges which may be imposed in relation to it.
MP&L Capital will not be required to register or cause to be
registered any transfer of Preferred Securities after they have been
called for redemption except the unredeemed portion of any Preferred
Securities being redeemed in part.
Concerning the Property Trustee
The Company maintains deposit accounts and conducts other banking
transactions with the Property Trustee in the ordinary course of their
businesses. The Property Trustee also acts as the Guarantee Trustee
under the Guarantee, the Debenture Trustee under the Indenture and
trustee under the Company's Mortgage and Deed of Trust with respect to
all of the electric generating plants and other materially important
physical properties of the Company and substantially all other
properties described in the Mortgage as owned by the Company, subject
to certain exceptions.
Miscellaneous
Application will be made to list the Preferred Securities on the
New York Stock Exchange.
The Delaware Trustee will act as the resident trustee in the
State of Delaware and will have no other significant duties. The
Property Trustee will hold the Junior Subordinated Debentures on
behalf of MP&L Capital and will maintain a payment account with
respect to the Trust Securities, and will also act as trustee under
the Trust Agreement for the purposes of the Trust Indenture Act. See
"Events of Default; Notice." The Administrative Trustees will
administer the day to day operations of MP&L Capital. See "Voting
Rights."
The Administrative Trustees are authorized and directed to
conduct the affairs of MP&L Capital and to operate MP&L Capital so
that MP&L Capital will not be deemed to be an "investment company"
required to be registered under the 1940 Act or taxed as a corporation
for United States federal income tax purposes and so that the Junior
Subordinated Debentures will be treated as indebtedness of the Company
for United States federal income tax purposes. In this connection,
the Administrative Trustees and the Company are authorized to take any
action, not inconsistent with applicable law, the certificate of trust
or the Trust Agreement, that the Administrative Trustees and the
Company determine in their discretion to be necessary or desirable for
such purposes, as long as such action does not materially adversely
affect the interests of the Holders of the Preferred Securities.
Holders of the Preferred Securities have no preemptive or similar
rights.
DESCRIPTION OF THE GUARANTEE
Set forth below is a summary of information concerning the
Guarantee that will be executed and delivered by the Company for the
benefit of the Holders from time to time of Preferred Securities. The
Guarantee will be qualified as an indenture under the Trust Indenture
Act. The Bank of New York will act as Guarantee Trustee under the
Guarantee for the purposes of compliance with the Trust Indenture Act.
The terms of the Guarantee will be those set forth in such Guarantee
and those made part of such Guarantee by the Trust Indenture Act. The
summary does not purport to be complete and is subject in all respects
to the provisions of, and is qualified in its entirety by reference
to, the Guarantee, which is filed as an exhibit to the Registration
Statement of which this Prospectus forms a part, and the Trust
Indenture Act. The Guarantee Trustee will hold the Guarantee for the
benefit of the Holders of the Preferred Securities.
General
The Company will fully and unconditionally agree, to the extent
set forth herein, to pay the Guarantee Payments (as defined herein) in
full to the Holders of the Preferred Securities (except to the extent
paid by or on behalf of MP&L Capital), as and when due, regardless of
any defense, right of set-off or counterclaim that the Company may
have or assert. The following payments with respect to the Preferred
Securities, to the extent not paid by or on behalf of MP&L Capital
(the "Guarantee Payments"), will be subject to the Guarantee (without
duplication): (i) any accrued and unpaid Distributions required to be
paid on the Preferred Securities, to the extent the Property Trustee
has available in the payment account sufficient funds to make such
payment, (ii) the Redemption Price with respect to any Preferred
Securities called for redemption by MP&L Capital, to the extent the
Property Trustee has available in the payment account sufficient funds
to make such payment and (iii) upon a voluntary or involuntary
dissolution, winding-up or termination of MP&L Capital (other than in
connection with a redemption of all of the Preferred Securities), the
lesser of (a) the aggregate of the liquidation preference amount and
all accrued and unpaid Distributions on the Preferred Securities to
the date of payment and (b) the amount of assets of MP&L Capital
remaining available for distribution to Holders of Preferred
Securities in liquidation of MP&L Capital. The Company's obligation
to make a Guarantee Payment may be satisfied by direct payment of the
required amounts by the Company to the Holders of Preferred Securities
or by causing MP&L Capital to pay such amounts to such Holders.
The Guarantee will be a guarantee with respect to the Preferred
Securities issued by MP&L Capital from the time of issuance of the
Preferred Securities, but will not apply to (i) any payment of
Distributions if and to the extent that MP&L Capital does not have
funds available to make such payments, or (ii) collection of payment.
If the Company does not make interest payments on the Junior
Subordinated Debentures held by MP&L Capital, MP&L Capital will not
have funds available to pay Distributions on the Preferred Securities.
The Guarantee will rank subordinate and junior in right of payment to
all liabilities of the Company (except those made pari passu by their
terms). See "Status of the Guarantee." The Company has agreed in the
Expense Agreement to provide funds to MP&L Capital as needed to pay
obligations of MP&L Capital to parties other than Holders of Trust
Securities. The obligations of the Company with respect to the
Guarantee, the Expense Agreement and the Debentures constitute a full
and unconditional guarantee of the Preferred Securities by the
Company. No single document standing alone or operating in
conjunction with fewer than all of the other documents constitutes
such guarantee. It is only the combined operation of these documents
that has the effect of providing a full and unconditional guarantee of
MP&L's Capital obligations under the Preferred Securities.
Amendments and Assignment
Except with respect to any changes that do not materially
adversely affect the rights of Holders of Preferred Securities (in
which case no vote will be required), the terms of the Guarantee may
be changed only with the prior approval of the Holders of Preferred
Securities having at least 66 2/3% of the liquidation preference
amount of the outstanding Preferred Securities. All guarantees and
agreements contained in the Guarantee shall bind the successors,
assigns, receivers, trustees and representatives of the Company and
shall inure to the benefit of the Holders of the Preferred Securities
then outstanding.
Events of Default
An event of default under the Guarantee will occur upon the
failure of the Company to perform any of its payment obligations
thereunder. The Holders of Preferred Securities having a majority of
the liquidation preference of the Preferred Securities have the right
to direct the time, method and place of conducting any proceeding for
any remedy available to the Guarantee Trustee in respect of the
Guarantee or to direct the exercise of any trust or power conferred
upon the Guarantee Trustee under the Guarantee.
If the Guarantee Trustee fails to enforce the Guarantee, any
Holder of Preferred Securities may institute a legal proceeding
directly against the Company to enforce the Guarantee Trustee's rights
under the Guarantee without first instituting a legal proceeding
against MP&L Capital, the Guarantee Trustee or any other person or
entity.
The Company, as Guarantor, will be required to provide annually
to the Guarantee Trustee a statement as to the performance by the
Company of certain of its obligations under the Guarantee and as to
any default in such performance and an officer's certificate as to the
Company's compliance with all conditions under the Guarantee.
Information Concerning the Guarantee Trustee
The Guarantee Trustee, prior to the occurrence of a default by
the Company in performance of the Guarantee, has undertaken to perform
only such duties as are specifically set forth in the Guarantee and,
after default with respect to the Guarantee, must exercise the same
degree of care as a prudent individual would exercise in the conduct
of his or her own affairs. Subject to this provision, the Guarantee
Trustee is under no obligation to exercise any of the powers vested in
it by the Guarantee at the request of any Holder of Preferred
Securities unless it is offered reasonable indemnity against the
costs, expenses and liabilities that might be incurred thereby. See
"Description of the Preferred Securities -- Concerning the Property
Trustee."
Termination of the Guarantee
The Guarantee will terminate and be of no further force and
effect upon full payment of the Redemption Price of all Preferred
Securities, the distribution of Junior Subordinated Debentures to
Holders of Preferred Securities in exchange for all of the Preferred
Securities or full payment of the amounts payable upon liquidation of
MP&L Capital. The Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder of Preferred
Securities must restore payment of any sums paid under the Preferred
Securities or the Guarantee.
Status of the Guarantee
The Guarantee will constitute an unsecured obligation of the
Company and will rank (i) subordinate and junior in right of payment
to all liabilities of the Company (except liabilities that may be made
pari passu by their terms), (ii) pari passu with the most senior
preferred or preference stock now or hereafter issued by the Company
and with any guarantee now or hereafter entered into by the Company in
respect of any preferred or preference stock of any affiliate of the
Company and (iii) senior to the Company's common stock. The Trust
Agreement provides that each Holder of Preferred Securities by
acceptance thereof agrees to the subordination provisions and other
terms of the Guarantee.
The Guarantee will constitute a guarantee of payment and not of
collection (i.e., the guaranteed party may institute a legal
proceeding directly against the Guarantor to enforce its rights under
the Guarantee without first instituting a legal proceeding against any
other person or entity).
Governing Law
The Guarantee will be governed by and construed in accordance
with the laws of the State of New York.
DESCRIPTION OF THE JUNIOR SUBORDINATED DEBENTURES
Set forth below is a description of the specific terms of the
Junior Subordinated Debentures which MP&L Capital will hold as trust
assets. The following description does not purport to be complete and
is qualified in its entirety by reference to the description in the
Indenture between the Company and the Trustee with respect to the
Junior Subordinated Debentures (the "Debenture Trustee"), which is
filed as an exhibit to the Registration Statement of which this
Prospectus forms a part. Whenever particular provisions or defined
terms in the Indenture are referred to herein, such provisions or
defined terms are incorporated by reference herein. Section
references used herein are references to provisions of the Indenture
unless otherwise noted.
The Indenture provides for the issuance of debentures (including
the Junior Subordinated Debentures), notes or other evidence of
indebtedness by the Company (each a "Debt Security") in an unlimited
amount from time to time. The Junior Subordinated Debentures
constitute a separate series under the Indenture.
General
The Junior Subordinated Debentures will be limited in aggregate
principal amount to the sum of the aggregate liquidation preference
amount of the Preferred Securities and the consideration paid by the
Company for the Common Securities and will have terms similar to the
terms of the Preferred Securities. The Junior Subordinated Debentures
are unsecured, subordinated obligations of the Company which rank
junior to all of the Company's Senior Indebtedness. The Junior
Subordinated Debentures will bear interest at the same rate, payable
at the same times, as the distributions payable on the Trust
Securities, and will have a maturity and redemption provisions
correlative to those of the Trust Securities.
The entire outstanding principal amount of the Junior
Subordinated Debentures will become due and payable, together with any
accrued and unpaid interest thereon, including Additional Interest (as
defined herein), if any, on , . The amounts payable as
principal and interest on the Junior Subordinated Debentures will be
sufficient to provide for payment of Distributions payable on the
Trust Securities.
The Articles of Incorporation of the Company limit the
amount of unsecured indebtedness with a maturity of more than one year
that the Company may create or assume, without the consent of the
Holders of a majority of the total number of shares of preferred stock
then outstanding, to not more than 25% of the aggregate of the sum of
the principal amount of the secured indebtedness of the Company and
the capital stock and surplus of the Company as stated on the
Company's books of account. At December 31, 1995, the Company could
have issued approximately $249 million of unsecured indebtedness (such
as the Junior Subordinated Debentures) without violating this
provision.
Also under the Articles of Incorporation, the creation or
assumption of unsecured indebtedness with a maturity of more than one
year requires that net earnings available for the payment of interest
for 12 consecutive out of the preceding 15 months be at least twice
the annual interest requirements on all outstanding indebtedness of
the Company, including the indebtedness to be created or assumed. At
December 31, 1995, the Company could have issued an additional $141
million of unsecured indebtedness, including the Junior Subordinated
Debentures, at an assumed annual interest rate of 7.75%, without
violating this provision.
If Junior Subordinated Debentures are distributed to Holders of
Preferred Securities in a termination of MP&L Capital, such Junior
Subordinated Debentures will be issued in fully registered
certificated form in denominations of $25 and integral multiples
thereof and may be transferred or exchanged at the offices described
below.
Payments of principal and interest on Junior Subordinated
Debentures will be payable, the transfer of Junior Subordinated
Debenture will be registrable, and Junior Subordinated Debentures will
be exchangeable for Junior Subordinated Debentures of other
denominations of a like aggregate principal amount, at the corporate
trust office of the Debenture Trustee in The City of New York;
provided that payment of interest may be made at the option of the
Company by check mailed to the address of the persons entitled thereto
and that the payment in full of principal with respect to any Junior
Subordinated Debenture will be made only upon surrender of such Junior
Subordinated Debenture to the Debenture Trustee.
Optional Redemption
On or after , the Company will have the right, at
any time and from time to time, to redeem the Junior Subordinated
Debentures, in whole or in part, at a redemption price equal to 100%
of the principal amount of the Junior Subordinated Debentures being
redeemed, together with any accrued but unpaid interest, including
Additional Interest, if any, to the Redemption Date.
If a Special Event shall occur and be continuing, the Company
shall have the right to redeem the Junior Subordinated Debentures, in
whole but not in part, at a redemption price equal to 100% of the
principal amount of Junior Subordinated Debentures then outstanding
plus any accrued and unpaid interest, including Additional Interest,
if any, to the Redemption Date. The Junior Subordinated Debentures
will be subject to optional redemption in whole but not in part upon
the termination and liquidation of MP&L Capital pursuant to an order
for the dissolution, termination or liquidation of MP&L Capital
entered by a court of competent jurisdiction.
For so long as MP&L Capital is the Holder of all the outstanding
Junior Subordinated Debentures, the proceeds of any such redemption
will be used by MP&L Capital to redeem Preferred Securities and Common
Securities in accordance with their terms. The Company may not redeem
less than all the Junior Subordinated Debentures unless all accrued
and unpaid interest (including any Additional Interest) has been paid
in full on all outstanding Junior Subordinated Debentures for all
quarterly interest periods terminating on or prior to the date of
redemption.
Any optional redemption of Junior Subordinated Debentures shall
be made upon not less than 30 nor more than 60 days' notice from the
Debenture Trustee to the Holders of Junior Subordinated Debentures, as
provided in the Indenture. All notices of redemption shall state the
Redemption Date, the redemption price plus accrued and unpaid
distributions, if less than all the Junior Subordinated Debentures are
to be redeemed, the identification of those to be redeemed and the
portion of the principal amount of any Junior Subordinated Debentures
to be redeemed in part; that on the Redemption Date, subject to the
Debenture Trustee's receipt of the redemption monies, the redemption
price plus accrued and unpaid distributions will become due and
payable upon each such Junior Subordinated Debentures to be redeemed
and that interest thereon will cease to accrue on and after said date;
and the place or places where such securities are to be surrendered
for payment of the redemption price plus accrued and unpaid
distributions.
Interest
The Junior Subordinated Debentures shall bear interest at the
rate of % per annum. Such interest is payable quarterly in arrears
on March 31, June 30, September 30 and December 31 of each year (each,
an "Interest Payment Date"), commencing , 1996, to the
person in whose name each Junior Subordinated Debenture is registered,
by the close of business on the Business Day 15 days preceding such
Interest Payment Date. It is anticipated that MP&L Capital will be
the sole Holder of the Junior Subordinated Debentures.
The amount of interest payable for any period will be computed on
the basis of a 360-day year of twelve 30-day months and for any period
shorter than a full month, on the basis of the actual number of days
elapsed (Section 310). In the event that any date on which interest
is payable on the Junior Subordinated Debentures is not a Business
Day, then payment of the interest payable on such date will be made on
the next succeeding day which is a Business Day (and without any
interest or other payment in respect of any such delay), except that,
if such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day, in
each case with the same force and effect as if made on the date the
payment was originally payable (Section 113).
Option to Extend Interest Payment Period
The Company has the right under the Indenture to extend the
interest payment period from time to time on the Junior Subordinated
Debentures to a period not exceeding 20 consecutive quarters during
which period interest will be compounded quarterly. At the end of an
Extension Period, the Company must pay all interest then accrued and
unpaid (together with interest thereon at the rate specified for the
Junior Subordinated Debentures compounded quarterly, to the extent
permitted by applicable law). However, during any such Extension
Period, the Company shall not (i) declare or pay any dividend or
distribution (other than a dividend or distribution in Common Stock of
the Company) on, or redeem, purchase, acquire or make a liquidation
payment with respect to, any of its capital stock or (ii) make any
payment of principal of, interest or premium, if any, on, or repay,
repurchase or redeem any indebtedness that is pari passu with the
Junior Subordinated Debentures (including other Debt Securities), or
make any guarantee payments with respect to the foregoing. Prior to
the termination of any such Extension Period, the Company may further
extend the interest payment period, provided that such Extension
Period together with all such previous and further extensions thereof
shall not exceed 20 consecutive quarters at any one time or extend
beyond the maturity date of the Junior Subordinated Debentures. Any
extension period with respect to payment of interest on the Junior
Subordinated Debentures, other Debt Securities or on any similar
securities will apply to all such securities and will also apply to
Distributions with respect to the Preferred Securities and all other
securities with terms substantially the same as the Preferred
Securities. Upon the termination of any such Extension Period and the
payment of all amounts then due, the Company may select a new
Extension Period, subject to the above requirements. No interest
shall be due and payable during an Extension Period, except at the end
thereof. The Company will give MP&L Capital and the Debenture Trustee
notice of its election of an Extension Period prior to the earlier of
(i) one Business Day prior to the record date for the distribution
which would occur but for such election or (ii) the date the Company
is required to give notice to the NYSE or other applicable
self-regulatory organization of the record date and will cause MP&L
Capital to send notice of such election to the Holders of Preferred
Securities.
Additional Interest
So long as any Preferred Securities remain outstanding, if MP&L
Capital would be required to pay, with respect to its income derived
from the interest payments on the Junior Subordinated Debentures any
amounts for or on account of any taxes, duties, assessments or
governmental charges of whatever nature imposed by the United States,
or any other taxing authority, then, in any such case, the Company
will pay as interest on such Junior Subordinated Debentures such
additional interest (the "Additional Interest") as may be necessary in
order that the net amounts received and retained by MP&L Capital after
the payment of such taxes, duties, assessments or governmental charges
shall result in the MP&L Capital's having such funds as it would have
had in the absence of the payment of such taxes, duties, assessments
or governmental charges.
Defeasance
The principal amount of any series of Debt Securities issued
under the Indenture will be deemed to have been paid for purposes of
the Indenture and the entire indebtedness of the Company in respect
thereof will be deemed to have been satisfied and discharged, if there
shall have been irrevocably deposited with the Debenture Trustee or
any paying agent, in trust: (a) money in an amount which will be
sufficient, or (b) in the case of a deposit made prior to the maturity
of the Junior Subordinated Debentures, Government Obligations (as
defined herein), which do 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
Debenture Trustee, will be sufficient, or (c) a combination of (a) and
(b) which will be sufficient, to pay when due the principal of and
premium, if any, and interest, if any, due and to become due on the
Debt Securities of such series that are outstanding. For this
purpose, Government Obligations, include direct obligations of, or
obligations unconditionally guaranteed by, the United States of
America entitled to the benefit of the full faith and credit thereof
and certificates, depositary receipts or other instruments which
evidence a direct ownership interest in such obligations or in any
specific interest or principal payments due in respect thereof.
It is possible that for United States federal income tax purposes
any deposit contemplated in the preceding paragraph could be treated
as a taxable exchange of the Junior Subordinated Debentures
outstanding for an issue of obligations of MP&L Capital or a direct
interest in the cash and securities held by MP&L Capital. In that
case, Holders of the Junior Subordinated Debentures outstanding would
recognize a gain or loss for federal income tax purposes, as if their
share of MP&L Capital obligations or the cash or securities deposited,
as the case may be, had actually been received by them in exchange for
their Junior Subordinated Debentures. In addition, such Holders
thereafter would be required to include in income a share of the
income, gain or loss of MP&L Capital. The amount so required to be
included in income could be different from the amount that would be
includable in the absence of such deposit. Prospective investors are
urged to consult their own tax advisors as to the specific
consequences to them of any such deposit.
Subordination
The Junior Subordinated Debentures will be subordinate and junior
in right of payment to all Senior Indebtedness of the Company to the
extent provided in the Indenture. No payment of principal of
(including redemption and sinking fund payments), or interest on, the
Junior Subordinated Debentures may be made (i) upon the occurrence of
certain events of bankruptcy, insolvency or reorganization, (ii) if
any Senior Indebtedness is not paid when due, (iii) if any other
default has occurred pursuant to which the Holders of Senior
Indebtedness have accelerated the maturity thereof and with respect to
(ii) and (iii), such default has not been cured or waived, or (iv) if
the maturity of any series of Debt Securities has been accelerated,
because of an event of default with respect thereto, which remains
uncured. Upon any payment or distribution of assets of the Company to
creditors upon any dissolution, winding-up, liquidation or
reorganization, whether voluntary or involuntary or in bankruptcy,
insolvency, receivership or other proceedings, all principal of, and
premium, if any, and interest due or to become due on, all Senior
Indebtedness must be paid in full before the Holders of the Junior
Subordinated Debentures are entitled to receive or retain any payment
thereon. (Section 1502). Subject to the prior payment of all Senior
Indebtedness, the rights of the Holders of the Junior Subordinated
Debentures will be subrogated to the rights of the Holders of Senior
Indebtedness to receive payments or distributions applicable to Senior
Indebtedness until all amounts owing on the Junior Subordinated
Debentures are paid in full. (Section 1504).
The term Senior Indebtedness is defined in the Indenture to mean
all obligations (other than non-recourse obligations and the
indebtedness issued under the Indenture) of, or guaranteed or assumed
by, the Company for borrowed money, including both senior and
subordinated indebtedness for borrowed money (other than the Debt
Securities), or for the payment of money relating to any lease which
is capitalized on the consolidated balance sheet of the Company and
its subsidiaries in accordance with generally accepted accounting
principles as in effect from time to time, or evidenced by bonds,
debentures, notes or other similar instruments, and in each case,
amendments, renewals, extensions, modifications and refundings of any
such indebtedness or obligations, whether existing as of the date of
this Indenture or subsequently incurred by the Company unless, in the
case of any particular indebtedness, renewal, extension or refunding,
the instrument creating or evidencing the same or the assumption or
guarantee of the same expressly provides that such indebtedness,
renewal, extension or refunding is not superior in right of payment to
or is pari passu with the Junior Subordinated Debentures; provided
that the Company's obligations under the Guarantee shall not be deemed
to be Senior Indebtedness. (Section 101).
The Indenture does not limit the aggregate amount of Senior
Indebtedness that may be issued. As of December 31, 1995, the Company
had approximately $790 million principal amount of indebtedness for
borrowed money constituting Senior Indebtedness.
Consolidation, Merger, and Sale of Assets
Under the terms of the Indenture, the Company may not consolidate
with or merge into any other entity or convey, transfer or lease its
properties and assets substantially as an entirety to any entity,
unless (i) the corporation formed by such consolidation or into which
the Company is merged or the entity which acquires by conveyance or
transfer, or which leases, the property and assets of the Company
substantially as an entirety shall be a entity organized and validly
existing under the laws of any domestic jurisdiction and such entity
expressly assumes the Company's obligations on all Debt Securities and
under the Indenture, (ii) immediately after giving effect to the
transaction, no Event of Default, and no event which, after notice or
lapse of time or both, would become an Event of Default, shall have
occurred and be continuing, and (iii) the Company shall have delivered
to the Debenture Trustee an Officer's Certificate and an Opinion of
Counsel as provided in the Indenture. (Section 1101).
Events of Default
Each of the following will constitute an Event of Default under
the Indenture with respect to the Debt Securities of any series: (a)
failure to pay any interest on the Debt Securities of such series
within 30 days after the same becomes due and payable, provided that
deferral of payment during an Extension Period will not constitute an
Event of Default; (b) failure to pay principal or premium, if any, on
the Debt Securities of such series when due and payable; (c) failure
to perform, or breach of, any other covenant or warranty of the
Company in the Indenture (other than a covenant or warranty of the
Company in the Indenture solely for the benefit of one or more series
of Debt Securities other than such series) for 60 days after written
notice to the Company by the Debenture Trustee, or to the Company and
the Debenture Trustee by the Holders of at least 33% in principal
amount of the Debt Securities of such series outstanding under the
Indenture as provided in the Indenture; (d) the entry by a court
having jurisdiction in the premises of (1) 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 (2) 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 90 consecutive days; and (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 other
similar proceeding or to the commencement of any bankruptcy or
insolvency case or proceeding against it under any applicable Federal
or state law 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. (Section 801).
An Event of Default with respect to the Debt Securities of a
particular series may not necessarily constitute an Event of Default
with respect to Debt Securities of any other series issued under the
Indenture.
If an Event of Default due to the default in payment of principal
of or interest on any series of Debt Securities or due to the default
in the performance or breach of any other covenant or warranty of the
Company applicable to the Debt Securities of such series but not
applicable to all series occurs and is continuing, then either the
Trustee or the Holders of 33% in principal amount of the outstanding
Debt Securities of such series may declare the principal of all of the
Debt Securities of such series and interest accrued thereon to be due
and payable immediately (subject to the subordination provisions of
the Indenture). If an Event of Default due to the default in the
performance of any other covenants or agreements in the Indenture
applicable to all outstanding Debt Securities or due to certain events
of bankruptcy, insolvency or reorganization of the Company has
occurred and is continuing, either the Trustee or the Holders of not
less than 33% in principal amount of all outstanding Debt Securities,
considered as one class, and not the Holders of the Debt Securities of
any one of such series may make such declaration of acceleration
(subject to the subordination provisions of the Indenture).
At any time after the declaration of acceleration with respect to
the Debt Securities of any series has been made and before a judgment
or decree for payment of the money due has been obtained, the Event or
Events of Default giving rise to such declaration of acceleration
will, without further act, be deemed to have been waived, and such
declaration and its consequences will, without further act, be deemed
to have been rescinded and annulled, if
(a) the Company has paid or deposited with the Debenture Trustee
a sum sufficient to pay
(1) all overdue interest on all Debt Securities of such
series;
(2) the principal of and premium, if any, on any Debt
Securities of such series which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate or rates
prescribed therefor in such Debt Securities;
(3) interest upon overdue interest at the rate or rates
prescribed therefor in such Debt Securities, to the extent that
payment of such interest is lawful; and
(4) all amounts due to the Debenture Trustee under the
Indenture; and
(b) any other Event or Events of Default with respect to Debt
Securities of such series, other than the nonpayment of the principal
of the Debt Securities of such series which has become due solely by
such declaration of acceleration, have been cured or waived as
provided in the Indenture. (Section 802).
Subject to the provisions of the Indenture relating to the duties
of the Debenture Trustee in case an Event of Default shall occur and
be continuing, the Debenture Trustee will be under no obligation to
exercise any of its rights or powers under the Indenture at the
request or direction of any of the Holders of the Junior Subordinated
Debentures, unless such Holders shall have offered to the Debenture
Trustee reasonable indemnity. (Section 903). If an Event of Default
has occurred and is continuing in respect of a series of Debt
Securities, subject to such provisions for the indemnification of the
Debenture Trustee, the Holders of a majority in principal amount of
the outstanding Debt Securities of such series will have the right to
direct the time, method and place of conducting any proceeding for any
remedy available to the Debenture Trustee, or exercising any trust or
power conferred on the Debenture Trustee, with respect to the Debt
Securities of such series; provided, however, that if an Event of
Default occurs and is continuing with respect to more than one series
of Debt Securities, the Holders of a majority in aggregate principal
amount of the outstanding Debt Securities of all such series,
considered as one class, will have the right to make such direction,
and not the Holders of the Debt Securities of any one of such series;
and provided, further, that such direction will not be in conflict
with any rule of law or with the Indenture. (Section 812).
No Holder of Debt Securities of any series will have any right to
institute any proceeding with respect to the Indenture, or for the
appointment of a receiver or a trustee, or for any other remedy
thereunder, unless (i) such Holder has previously given to the
Debenture Trustee written notice of a continuing Event of Default with
respect to the Debt Securities of such series, (ii) the Holders of not
less than a majority in aggregate principal amount of the outstanding
Debt Securities of all series in respect of which an Event of Default
shall have occurred and be continuing, considered as one class, have
made written request to the Debenture Trustee, and such Holder or
Holders have offered reasonable indemnity to the Debenture Trustee to
institute such proceeding in respect of such Event of Default in its
own name as trustee and (iii) the Debenture Trustee has failed to
institute any proceeding, and has not received from the Holders of a
majority in aggregate principal amount of the outstanding Debt
Securities of such series a direction inconsistent with such request,
within 60 days after such notice, request and offer. (Section 807).
However, such limitations do not apply to a suit instituted by a
Holder of a Debt Security for the enforcement of payment of the
principal of or any premium or interest on such Debt Security on or
after the applicable due date specified in such Debt Security.
(Section 808).
The Company will be required to furnish to the Debenture Trustee
annually a statement by an appropriate officer as to such officer's
knowledge of the Company's compliance with all conditions and
covenants under the Indenture, such compliance to be determined
without regard to any period of grace or requirement of notice under
the Indenture. (Section 606).
Modification and Waiver
Without the consent of any Holder of Debt Securities, the Company
and the Debenture Trustee may enter into one or more supplemental
indentures for any of the following purposes: (a) to evidence the
assumption by any permitted successor to the Company of the covenants
of the Company in the Indenture and in the Debt Securities; or (b) to
add one or more covenants of the Company or other provisions for the
benefit of the Holders of outstanding Debt Securities or to surrender
any right or power conferred upon the Company by the Indenture; or (c)
to add any additional Events of Default with respect to outstanding
Debt Securities; or (d) to change or eliminate any provision of the
Indenture or to add any new provision to the Indenture, provided that
if such change, elimination or addition will adversely affect the
interests of the Holders of Debt Securities of any series in any
material respect, such change, elimination or addition will become
effective with respect to such series only (1) when the consent of the
Holders of Debt Securities of such series has been obtained in
accordance with the Indenture, or (2) when no Debt Securities of such
series remain outstanding under the Indenture; or (e) to provide
collateral security for all but not part of the Debt Securities; (f)
to establish the form or terms of Debt Securities of any other series
as permitted by the Indenture; or (g) 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 (h) to evidence and provide for the acceptance
of appointment of a successor Debenture Trustee under the Indenture
with respect to the Debt Securities of one or more series and to add
to or change any of the provisions of the Indenture as shall be
necessary to provide for or to facilitate the administration of the
trusts under the Indenture by more than one trustee; or (i) to
provide for the procedures required to permit the utilization of a
noncertificated system of registration for the Debt Securities of all
or any series; or (j) to change any place where (1) the principal of
and premium, if any, and interest, if any, on all or any series of
Debt Securities shall be payable, (2) all or any series of Debt
Securities may be surrendered for registration of transfer or exchange
and (3) notices and demands to or upon the Company in respect of Debt
Securities and the Indenture may be served; or (k) to cure any
ambiguity or inconsistency or to add or change any other provisions
with respect to matters and questions arising under the Indenture,
provided such changes or additions shall not adversely affect the
interests of the Holders of Debt Securities of any series in any
material respect. (Section 1201).
The Holders of at least a majority in aggregate principal amount
of the Debt Securities of all series then outstanding may waive
compliance by the Company with certain restrictive provisions of the
Indenture. (Section 607). The Holders of not less than a majority in
principal amount of the outstanding Debt Securities of any series may
waive any past default under the Indenture with respect to such
series, except a default in the payment of principal, premium, or
interest and certain covenants and provisions of the Indenture that
cannot be modified or be amended without the consent of the Holder of
each outstanding Debt Security of such series affected. (Section 813).
Without limiting the generality of the foregoing, if the Trust
Indenture Act is amended after the date of the Indenture in such a way
as to require changes to the Indenture or the incorporation therein of
additional provisions or so as to permit changes to, or the
elimination of, provisions which, at the date of the Indenture or at
any time thereafter, were required by the Trust Indenture Act to be
contained in the Indenture, the Indenture will be deemed to have been
amended so as to conform to such amendment of the Trust Indenture Act
or to effect such changes, additions or elimination, and the Company
and the Debenture Trustee may, without the consent of any Holders,
enter into one or more supplemental indentures to evidence or effect
such amendment. (Section 1201).
Except as provided above, the consent of the Holders of not less
than a majority in aggregate principal amount of the Debt Securities
of all series then outstanding, considered as one class, is required
for the purpose of adding any provisions to, or changing in any
manner, or eliminating any of the provisions of, the Indenture or
modifying in any manner the rights of the Holders of such Debt
Securities under the Indenture pursuant to one or more supplemental
indentures; provided, however, that if less than all of the series of
Debt Securities outstanding are directly affected by a proposed
supplemental indenture, then the consent only of the Holders of a
majority in aggregate principal amount of outstanding Debt Securities
of all series so directly affected, considered as one class, will be
required; and provided further, that no such amendment or modification
may (a) change the Stated Maturity of the principal of, or any
installment of principal of or interest on, any Debt 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 upon the
redemption thereof, or change the coin or currency (or other property)
in which any Debt Security or any premium or the interest thereon is
payable, or impair the right to institute suit for the enforcement of
any such payment on or after the Stated Maturity of any Debt Security
(or, in the case of redemption, on or after the Redemption Date)
without, in any such case, the consent of the Holder of such Debt
Security, (b) reduce the percentage in principal amount of the
outstanding Debt Security of any series, (or, if applicable, in
liquidation preference of Preferred Securities) 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 the Indenture or any default
thereunder and its consequences, or reduce the requirements for quorum
or voting, without, in any such case, the consent of the Holder of
each outstanding Debt Security of such series, or (c) modify certain
of the provisions of the Indenture relating to supplemental
indentures, waivers of certain covenants and waivers of past defaults
with respect to the Debt Security of any series, without the consent
of the Holder of each outstanding Junior Subordinated Debenture
affected thereby. A supplemental indenture which changes or
eliminates any covenant or other provision of the Indenture which has
expressly been included solely for the benefit of one or more
particular series of Debt Securities, or modifies the rights of the
Holders of Debt Securities of such series with respect to such
covenant or other provision, will be deemed not to affect the rights
under the Indenture of the Holders of the Debt Securities of any other
series. (Section 1202).
The Indenture provides that in determining whether the Holders of
the requisite principal amount of the outstanding Debt Securities have
given any request, demand, authorization, direction, notice, consent
or waiver under the Indenture, or whether a quorum is present at the
meeting of the Holders of Debt Securities, Debt Securities owned by
the Company or any other obligor upon the Debt Securities or any
affiliate of the Company or of such other obligor (unless the Company,
such affiliate or such obligor owns all Debt Securities outstanding
under the Indenture, determined without regard to this provision)
shall be disregarded and deemed not to be outstanding.
If the Company shall solicit from Holders any request, demand,
authorization, direction, notice, consent, election, waiver or other
Act, the Company may, at its option, fix in advance a record date for
the determination of Holders entitled to give such request, demand,
authorization, direction, notice, consent, waiver or other such act,
but the Company shall have no obligation to do so. If such a record
date is fixed, such request, demand, authorization, direction, notice,
consent, waiver or other Act may be given before or after such record
date, but only the Holders of record at the close of business on such
record date shall be deemed to be Holders for the purposes of
determining whether Holders of the requisite proportion of the
outstanding Debt Securities have authorized or agreed or consented to
such request, demand, authorization, direction, notice, consent,
waiver or other Act, and for that purpose the outstanding Debt
Securities shall be computed as of the record date. Any request,
demand, authorization, direction, notice, consent, election, waiver or
other Act of a Holder shall bind every future Holder of the same Debt
Security and the Holder of every Debt 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 Debenture Trustee or the Company in reliance thereon, whether or
not notation of such action is made upon such Debt Security. (Section
104).
Resignation of Debenture Trustee
The Debenture Trustee may resign at any time by giving written
notice thereof to the Company or may be removed at any time by Act of
the Holders of a majority in principal amount of all series of Debt
Securities then outstanding delivered to the Debenture Trustee and the
Company. No resignation or removal of the Debenture Trustee and no
appointment of a successor trustee will become effective until the
acceptance of appointment by a successor trustee in accordance with
the requirements of the Indenture. So long as no Event of Default or
event which, after notice or lapse of time, or both, would become an
Event of Default has occurred and is continuing and except with
respect to a Debenture Trustee appointed by Act of the Holders, if the
Company has delivered to the Debenture Trustee a resolution of its
Board of Directors appointing a successor trustee and such successor
has accepted such appointment in accordance with the terms of the
Indenture, the Trustee will be deemed to have resigned and the
successor will be deemed to have been appointed as trustee in
accordance with the Indenture. (Section 910).
Notices
Notices to Holders of Debt Securities will be given by mail to
the addresses of such Holders as they may appear in the security
register therefor.
Title
The Company, the Debenture Trustee, and any agent of the Company
or the Debenture Trustee, may treat the Person in whose name Debt
Securities are registered as the absolute owner thereof (whether or
not such Debt Securities may be overdue) for the purpose of making
payments and for all other purposes irrespective of notice to the
contrary.
Governing Law
The Indenture and the Debt Securities will be governed by, and
construed in accordance with, the laws of the State of New York.
Concerning the Debenture Trustee
The Debenture Trustee under the Indenture is The Bank of New
York. In addition, The Bank of New York acts as Property Trustee
under the Trust Agreement and as Guarantee Trustee under the
Guarantee. The Bank of New York (Delaware) acts as the Delaware
Trustee under the Trust Agreement. See "Description of the Preferred
Securities -- Concerning the Property Trustee."
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
The following summary describes certain United States federal
income tax consequences relevant to the purchase, ownership and
disposition of Preferred Securities as of the date hereof and
represents the opinion of Reid & Priest LLP, counsel to the Company,
insofar as it relates to matters of law or legal conclusions. Except
where noted, it deals only with Preferred Securities held as capital
assets and does not deal with special situations, such as those of
dealers in securities or currencies, financial institutions, life
insurance companies, persons holding Preferred Securities as a part of
a hedging or conversion transaction or a straddle, United States
Holders (as defined herein) whose "functional currency" is not the
U.S. dollar, or persons who are not United States Holders. In
addition, this discussion does not address the tax consequences to
persons who purchase Preferred Securities other than pursuant to their
initial issuance and distribution. Furthermore, the discussion below
is based upon the provisions of the Internal Revenue Code of 1986, as
amended (the "Code"), and regulations, rulings and judicial decisions
thereunder as of the date hereof, and such authorities may be
repealed, revoked or modified at any time so as to result in United
States federal income tax consequences different from those discussed
below. These authorities are subject to various interpretations and
it is therefore possible that the United States federal income tax
treatment of the Preferred Securities may differ from the treatment
described below.
PROSPECTIVE PURCHASERS OF PREFERRED SECURITIES, INCLUDING PERSONS
WHO ARE NOT UNITED STATES HOLDERS AND PERSONS WHO PURCHASE PREFERRED
SECURITIES IN THE SECONDARY MARKET, ARE ADVISED TO CONSULT WITH THEIR
TAX ADVISORS AS TO THE UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF PREFERRED SECURITIES IN
LIGHT OF THEIR PARTICULAR CIRCUMSTANCES, AS WELL AS THE EFFECT OF ANY
STATE, LOCAL OR OTHER TAX LAWS.
United States Holders
As used herein, a "United States Holder" means a Holder that is a
citizen or resident of the United States, a corporation, partnership
or other entity created or organized in or under the laws of the
United States or any political subdivision thereof, or an estate or
trust the income of which is subject to United States federal income
taxation regardless of its source.
Classification of MP&L Capital
Reid & Priest LLP, special counsel to the Company and MP&L
Capital, is of the opinion that, under current law and assuming full
compliance with the terms of the Indenture and the instruments
establishing MP&L Capital (and certain other documents), MP&L Capital
will be classified as a "grantor trust" for United States federal
income tax purposes and will not be classified as an association
taxable as a corporation. Each Holder will be treated as owning an
undivided beneficial interest in the Junior Subordinated Debentures.
Accordingly, each Holder will be required to include in its gross
income interest (in the form of OID) accrued with respect to its
allocable share of Junior Subordinated Debentures as described below.
No amount included in income with respect to the Preferred Securities
will be eligible for the dividends received deduction. Investors
should be aware that the opinion of Reid & Priest LLP does not address
any other issue and is not binding on the Internal Revenue Service or
the courts.
Classification of the Junior Subordinated Debentures
Based on the advice of its counsel, the Company believes and
intends to take the position that the Junior Subordinated Debentures
will constitute indebtedness for United States federal income tax
purposes. No assurance can be given that such position will not be
challenged by the Internal Revenue Service or, if challenged, that
such a challenge will not be successful. By purchasing and accepting
Preferred Securities, each Holder covenants to treat the Junior
Subordinated Debentures as indebtedness and the Preferred Securities
as evidence of an indirect beneficial ownership in the Junior
Subordinated Debentures. The remainder of this discussion assumes
that the Junior Subordinated Debentures will be classified as
indebtedness of the Company for United States federal income tax
purposes.
On December 7, 1995, the U.S. Treasury Department proposed
certain tax law changes that, among other things, would generally deny
interest deductions to corporate issuers of debt if the debt
instrument has a term exceeding 20 years and is not reflected as
indebtedness on the issuer's balance sheet. As described in the
Treasury Department's proposal, the proposed changes would not affect
the ability of the Company to deduct interest on the Junior
Subordinated Debentures because the term of the Junior Subordinated
Debentures is _____ years. However, there can be no assurance that
subsequent proposals or final legislation will not affect the ability
of the Company to deduct interest on the Junior Subordinated
Debentures, which in turn could give rise to a Tax Event, which would
permit the Company to cause a redemption of the Preferred Securities
or a distribution of the Junior Subordinated Debentures in liquidation
of MP&L Capital, as described more fully in the Prospectus under
"Description of the Preferred Securities -- Special Event Redemption
or Distribution."
Potential Extension of Interest Payment Period and Original Issue
Discount
Under the terms of the Junior Subordinated Debentures, the
Company has the option to defer payments of interest for up to 20
consecutive quarterly distribution payment periods and to pay as a
lump sum at the end of such period all of the interest that has
accrued during such period. During any such Extension Period,
Distributions on the Preferred Securities will also be deferred.
Because of this option to extend the interest payment periods, the
Junior Subordinated Debentures will be treated as having been issued
with OID for United States federal income tax purposes. As a result,
United States Holders will be required to accrue interest income (in
the form of OID) on an economic accrual basis even if they use the
cash method of tax accounting. In the event of an Extension Period, a
United States Holder will be required to continue to include OID in
income notwithstanding that MP&L Capital will not make any
Distribution on the Preferred Securities during such Extension Period.
As a result, any Holder who disposes of Preferred Securities prior to
the record date for the payment of Distributions following such
Extension Period will include interest in gross income but will not
receive any Distributions related thereto from MP&L Capital. The tax
basis of a Preferred Security will be increased by the amount of any
OID that is included in income, and will be decreased when and if
Distributions are subsequently received from MP&L Capital by such
Holders.
Receipt of Junior Subordinated Debentures or Cash Upon
Liquidation of MP&L Capital
Under certain circumstances, as described under the caption
"Description of the Preferred Securities -- Special Event Redemption
or Distribution," Junior Subordinated Debentures may be distributed to
Holders of Preferred Securities in exchange for the Preferred
Securities and in liquidation of MP&L Capital. Under current law, for
United States federal income tax purposes, if MP&L Capital is treated
as a grantor trust at the time of distribution, such a distribution
would be treated as a non-taxable event to each United States Holder,
and each United States Holder would receive an aggregate tax basis in
the Junior Subordinated Debentures equal to such Holder's aggregate
tax basis in its Preferred Securities. A United States Holder's
holding period for the Junior Subordinated Debentures received in
liquidation of MP&L Capital would include the period during which such
Holder held the Preferred Securities.
Under certain circumstances, as described under the caption
"Description of the Preferred Securities -- Redemption of Preferred
Securities," the Junior Subordinated Debentures may be redeemed for
cash and the proceeds of such redemption distributed to Holders of
Preferred Securities in redemption of the Preferred Securities. Under
current law, such a redemption would, for United States federal income
tax purposes, constitute a taxable disposition of the Preferred
Securities, and a Holder would recognize gain or loss as if such
Holder had sold such redeemed Preferred Securities. See "Sale,
Exchange and Redemption of the Preferred Securities."
Sale, Exchange and Redemption of the Preferred Securities
Upon the sale, exchange or redemption of Preferred Securities, a
United States Holder will recognize gain or loss equal to the
difference between the amount realized upon the sale, exchange or
redemption and such Holder's adjusted tax basis in the Preferred
Securities. A United States Holder's adjusted tax basis will, in
general, be the issue price of the Preferred Securities, increased by
the OID previously included in income by the United States Holder and
reduced by any Distributions on the Preferred Securities. Such gain
or loss will be capital gain or loss and will be long-term capital
gain or loss if at the time of sale, exchange or redemption, the
Preferred Securities have been held for more than one year. Under
current law, net capital gains of individuals are, under certain
circumstances, taxed at lower rates than items of ordinary income.
The deductibility of capital losses is subject to limitations.
Information Reporting and Backup Withholding
Subject to the qualification discussed below, income on the
Preferred Securities will be reported to holders on Form 1099, which
should be mailed to such Holders by January 31, following each
calendar year.
MP&L Capital will be obligated to report annually to Cede & Co.,
as holder of record of the Preferred Securities, the OID related to
the Junior Subordinated Debentures that accrued during the year. MP&L
Capital currently intends to report such information on Form 1099
prior to January 31, following each calendar year. The Underwriters
have indicated to MP&L Capital that, to the extent that they hold
Preferred Securities as nominees for beneficial holders, they
currently expect to report the OID that accrued during the calendar
year on such Preferred Securities to such beneficial holders on Forms
1099 by January 31, following each calendar year. Under current law,
holders of Preferred Securities who hold as nominees for beneficial
holders will not have any obligation to report information regarding
the beneficial holders to MP&L Capital. MP&L Capital, moreover, will
not have any obligation to report to beneficial holders who are not
also record holders. Thus, beneficial holders of Preferred Securities
who hold their Preferred Securities through the Underwriters will
receive Forms 1099 reflecting the income on their Preferred Securities
from such nominee holders rather than from MP&L Capital.
Payments made in respect of, and proceeds from the sale of,
Preferred Securities (or Junior Subordinated Debentures distributed to
holders of Preferred Securities) may be subject to "backup"
withholding tax of 31% unless the holder complies with certain
identification requirements or fails to report in full dividend and
interest income. Any withheld amounts will be allowed as a refund or
a credit against the holder's United Stated federal income tax
liability, provided the required information is provided to the
Internal Revenue Service.
These information reporting and backup withholding tax rules are
subject to temporary Treasury Regulations. Accordingly, the
application of such rules to the Preferred Securities could be
changed.
EXPERTS
The Company's financial statements incorporated in this
Prospectus by reference to the Company's Current Report on Form 8-K,
dated February 16, 1996, except as they relate to ADESA (an 80% owned
subsidiary of the Company), have been audited by Price Waterhouse LLP,
independent accountants, and, insofar as they relate to ADESA, by
Ernst & Young LLP, independent auditors. The report of Price
Waterhouse LLP thereon appears on page 10 of such Form 8-K. Such
financial statements, except as they relate to ADESA, have been so
incorporated in reliance on the report of Price Waterhouse LLP, given
on the authority of said firm as experts in auditing and accounting.
The financial statement schedule incorporated in this Prospectus
by reference to the Company 1994 10-K has been so incorporated in
reliance on the report of Price Waterhouse LLP, independent
accountants, given on the authority of said firm as experts in
auditing and accounting.
The consolidated financial statements of ADESA appearing in the
Company's Current Report on Form 8-K, dated July 12, 1995, for the
year ended December 31, 1994, have been audited by Ernst & Young LLP,
independent auditors, as set forth in their report thereon included in
said Current Report on Form 8-K and incorporated herein by reference
in reliance upon such report given upon the authority of such firm as
experts in accounting and auditing.
The consolidated financial statements of ADESA for the period
from July 1, 1995 to December 31, 1995 which are included in the
consolidated financial statements of the Company contained in the
Company's Current Report on Form 8-K, dated February 16, 1996 have
been audited by Ernst & Young LLP, independent auditors, as set forth
in their report thereon included in said Current Report on Form 8-K.
Such report is given upon the authority of such firm as experts in
accounting and auditing.
The statements made in the Company 1994 10-K under Part I, Item 1
-- Business-Regulation and Rates and Environmental Matters,
incorporated herein by reference, have been reviewed by Philip R.
Halverson, Esq., Duluth, Minnesota, General Counsel for the Company.
All of such statements are set forth or incorporated by reference
herein in reliance upon the opinion of Mr. Halverson given upon his
authority as an expert. At December 31, 1995, Mr. Halverson owned
approximately 4001 shares of the common stock of the Company.
Statements as to United States federal income taxation under "Certain
United States Federal Income Tax Consequences" herein have been passed
upon for the Company and MP&L Capital by Reid & Priest LLP, New York,
New York, of counsel to the Company.
LEGALITY
Certain matters of Delaware law relating to the validity of the
Preferred Securities, the enforceability of the Trust Agreement and
the creation of MP&L Capital are being passed upon by Richards, Layton
& Finger, Special Delaware counsel for the Company and MP&L Capital.
The legality of the other securities offered hereby will be passed
upon for the Company and MP&L Capital by Philip R. Halverson, Esq. and
by Reid & Priest LLP, and for the Underwriters by Lane & Mittendorf
LLP, New York, New York. However, all matters pertaining to
incorporation of the Company and all other matters of Minnesota law
will be passed upon only by Philip R. Halverson, Esq.
UNDERWRITING
Subject to the terms and conditions of the Underwriting
Agreement, the Company and MP&L Capital have agreed that MP&L Capital
will issue and sell to each of the Underwriters named below, and each
of the Underwriters, for whom Goldman, Sachs & Co. and PaineWebber
Incorporated are acting as Representatives, has severally agreed to
purchase from MP&L Capital the respective number of Preferred
Securities set forth opposite its name below:
Number of
Underwriter Preferred Securities
----------- --------------------
Goldman, Sachs & Co. . . . . . .
PaineWebber Incorporated . . . .
__________
Total. . . . . . . . . . . . . .
==========
Subject to the terms and conditions of the Underwriting
Agreement, the Underwriters are committed to take and pay for all the
Preferred Securities offered hereby, if any are taken.
The Underwriters propose to offer the Preferred Securities in
part directly to the public at the initial public offering price set
forth on the cover page of this Prospectus, and in part to certain
securities dealers at such price less a concession of $ per
Preferred Security. The Underwriters may allow, and such dealers may
reallow, a concession not in excess of $ per Preferred Security to
certain brokers and dealers. After the Preferred Securities are
released for sale to the public, the offering price and other selling
terms may from time to time be varied by the Representatives.
In view of the fact that the proceeds of the sale of the
Preferred Securities will be used to purchase the Junior Subordinated
Debentures, the Underwriting Agreement provides that the Company will
pay as compensation, for the Underwriters' arranging the investment
therein of such proceeds, an amount of $ per Preferred Security for
the accounts of the several Underwriters.
The Company and MP&L Capital have agreed that, during the period
beginning from the date of the Underwriting Agreement and continuing
to and including the earlier of (i) the date on which the distribution
of the Preferred Securities ceases, as determined by the
Representatives, or (ii) 90 days after the issuance of the Preferred
Securities, neither will offer, sell, contract to sell or otherwise
dispose of, any other beneficial interests in MP&L Capital or any
other securities of MP&L Capital or the Company, as the case may be,
that are substantially similar to the Preferred Securities (including
any guarantee of such securities) or any securities that are
convertible into or exchangeable for, or that represent the right to
receive, any such substantially similar securities of either MP&L
Capital or the Company, without the prior written consent of the
Representatives, provided that this restriction shall specifically not
apply to the Company's common stock, preferred stock, secured
indebtedness and unsecured indebtedness which is not subordinated.
Prior to this offering, there has been no public market for the
Preferred Securities. Application will be made to list the Preferred
Securities on the NYSE. In order to meet one of the requirements for
listing the Preferred Securities on the NYSE, the Underwriters will
undertake to sell lots of 100 or more Preferred Securities to a
minimum of 400 beneficial holders. Trading of the Preferred
Securities on the NYSE is expected to commence within a seven-day
period after the initial delivery of the Preferred Securities. The
Representatives have advised the Company that they intend to make a
market in the Preferred Securities prior to commencement of trading on
the NYSE, but are not obligated to do so and may discontinue any such
market making at any time without notice.
The Company and MP&L Capital have agreed to indemnify the
Underwriters against certain liabilities, including liabilities under
the 1933 Act.
Certain of the Underwriters or their affiliates have provided
from time to time, and expect to provide in the future, services to
the Company and its affiliates, in the ordinary course of business,
for which such Underwriters or their affiliates have received or will
receive customary fees and commissions.
======================================================================
No person has been authorized to give any information or to make any
representations other than those contained in this Prospectus and, if
given or made, such information or representations must not be relied
upon as having been authorized. This Prospectus does not constitute
an offer to sell or the solicitation of an offer to buy any securities
other than the securities described in this Prospectus or an offer to
sell or the solicitation of any offer to buy such securities in any
circumstances in which such offer or solicitation is unlawful.
Neither the delivery of this Prospectus nor any sale made hereunder
shall, under any circumstances, create any implication that the
information contained herein or therein is correct as of any time
subsequent to the date of such information.
--------------------
TABLE OF CONTENTS
Page
----
Available Information. . . . . . . . . . . . . . . . . . . . . 2
Incorporation of Certain Documents by Reference. . . . . . . . 2
Prospectus Summary . . . . . . . . . . . . . . . . . . . . . . 4
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . 6
The Company. . . . . . . . . . . . . . . . . . . . . . . . . . 9
MP&L Capital . . . . . . . . . . . . . . . . . . . . . . . . . 11
Summary Financial Information. . . . . . . . . . . . . . . . . 13
Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . 14
Description of the Preferred Securities. . . . . . . . . . . . 14
Description of the Guarantee . . . . . . . . . . . . . . . . . 25
Description of the Junior Subordinated Debentures. . . . . . . 27
Certain United States Federal Income Tax Consequences. . . . . 36
Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Legality . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Underwriting . . . . . . . . . . . . . . . . . . . . . . . . . 39
====================================================================
3,000,000 Preferred Securities
MP&L CAPITAL I
% Cumulative Quarterly Income
Preferred Securities (QUIPS) sm
Guaranteed to the extent
MP&L Capital I has funds as
set forth herein by
MINNESOTA POWER
& LIGHT COMPANY
----------
PROSPECTUS
----------
Goldman, Sachs & Co.
PaineWebber Incorporated
Representatives of the Underwriters
====================================================================
PART II.
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the estimated expenses payable by
the Company in connection with the issuance and distribution of the
securities to be registered.
Filing fee - Securities and Exchange Commission. . . $45,103.45*
Fees of the Trustee. . . . . . . . . . . . . . . . . 35,000.00
Counsel Fees . . . . . . . . . . . . . . . . . . . . 125,000.00
Auditors' fees . . . . . . . . . . . . . . . . . . . 30,000.00
Printing, including Registration Statement,
prospectuses, exhibits, etc.. . . . . . . . . . . . 15,000.00
Miscellaneous. . . . . . . . . . . . . . . . . . . . 24,896.55
----------
Total expenses . . . . . . . . . . . . . . . . . . . $275,000.00
==========
---------------
* Original filing fee paid by the Company at the time the
Registration Statement (Nos. 333-01035 and 333-01035-01) was
filed on February 16, 1996.
Item 15. Indemnification of Directors and Officers.
Section 302A.521 of the Minnesota Business Corporation Act
generally provides for the indemnification of directors, officers or
employees of a corporation made or threatened to be made a party to a
proceeding by reason of the former or present official capacity of the
person against judgments, penalties and fines (including attorneys'
fees and disbursements) where such person, among other things, has not
been indemnified by another organization, acted in good faith,
received no improper personal benefit and with respect to any criminal
proceeding, had no reasonable cause to believe his conduct was
unlawful.
Section 13 of the Bylaws of the Company contains the following
provisions relative to indemnification of directors and officers:
"The Company shall reimburse or indemnify each present and future
director and officer of the Company (and his or her heirs, executors
and administrators) for or against all expenses reasonably incurred by
such director or officer in connection with or arising out of any
action, suit or proceeding in which such director or officer may be
involved by reason of being or having been a director or officer of
the Company. Such indemnification for reasonable expenses is to be to
the fullest extent permitted by the Minnesota Business Corporation
Act, Minnesota Statutes Chapter 302A. By affirmative vote of the Board
of Directors or with written approval of the Chairman and Chief
Executive Officer, such indemnification may be extended to include
agents and employees who are not directors or officers of the Company,
but who would otherwise be indemnified for acts and omissions under
Chapter 302A of the Minnesota Business Corporation Act, if such agent
or employee were an officer of the Company."
"Reasonable expenses may include reimbursement of attorney's fees
and disbursements, including those incurred by a person in connection
with an appearance as a witness."
"Upon written request to the Company and approval by the Chairman
and Chief Executive Officer, an agent or employee for whom
indemnification has been extended, or an officer or director may
receive an advance for reasonable expenses if such agent, employee,
officer or director is made or threatened to be made a party to a
proceeding involving a matter for which indemnification is believed to
be available under Minnesota Statutes Chapter 302A."
"The foregoing rights shall not be exclusive of other rights to
which any director or officer may otherwise be entitled and shall be
available whether or not the director or officer continues to be a
director or officer at the time of incurring such expenses and
liabilities."
The Company has insurance covering its expenditures which might
arise in connection with the lawful indemnification of its directors
and officers for their liabilities and expenses, and insuring officers
and directors of the Company against certain other liabilities and
expenses.
Item 16. Exhibits.
1(a) - Form of Underwriting Agreement.
+3(a)1 - Articles of Incorporation, restated as of
July 27, 1988 (filed as Exhibit 3(a), File
No. 33-24936).
+3(a)2 - Certificate Fixing Terms of Serial Preferred
Stock A, $7.125 Series (filed as Exhibit
3(a)2, File No. 33-50143).
+3(a)3 - Certificate Fixing Terms of Serial Preferred
Stock A, $6.70 Series (filed as Exhibit
3(a)3, File No. 33-50143).
+3(b) - Bylaws as amended January 23, 1991 (filed as
Exhibit 3(b), File No. 33-45549).
**4(a) - Trust Agreement relating to the Preferred
Securities.
4(b) - Form of Amended and Restated Trust Agreement
relating to the Preferred Securities.
4(c) - Form of Indenture relating to the Junior
Subordinated Debentures.
4(d) - Form of Guarantee Agreement.
**4(e) - Form of Agreement as to Expenses and
Liabilities.
4(f) - Form of Officer's Certificate establishing
Debentures.
**4(g) - Form of Preferred Securities.
**5(a) - Opinion and Consent of Philip R. Halverson,
Esq., General Counsel and Corporate Secretary
of the Company.
**5(b)
and 8 - Opinion and Consent of Reid & Priest LLP.
**5(c) - Opinion and Consent of Richards, Layton &
Finger, Special Delaware Counsel to the
Company and MP&L Capital.
**12(a) - Computation of Ratio of Earnings to Fixed
Charges and Supplemental Ratio of Earnings to
Fixed Charges of the Company.
**12(b) - Computation of Ratio of Earnings to Fixed
Charges and Preferred Dividends and
Supplemental Ratio of Earnings to Fixed
Charges and Preferred Dividends of the
Company.
23(a) - Consent of Price Waterhouse LLP.
23(b) - Consent of Ernst & Young LLP.
**23(c) - Consents of Philip R. Halverson, Esq., Reid &
Priest LLP and Richards, Layton & Finger are
contained in Exhibits 5(a), 5(b) and 5(c),
respectively.
**24 - Power of Attorney (see page II-6).
**25(a) - Statement on Form T-1 of The Bank of New York
relating to Amended and Restated Trust
Agreement.
**25(b) - Statement on Form T-1 of The Bank of New York
relating to Indenture.
**25(c) - Statement on Form T-1 of The Bank of New York
relating to Guarantee Agreement.
______________________
** Previously filed.
+ Incorporated herein by reference as indicated.
Item 17. Undertakings.
The undersigned registrant hereby undertakes:
(1) That, for purposes of determining any liability under
the 1933 Act, each filing of the registrant's annual report
pursuant to Section 13(a) or Section 15(d) of the 1934 Act that
is incorporated by reference in this Registration Statement shall
be deemed to be a new registration statement relating to the
securities offered herein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(2) That, for purposes of determining any liability under
the 1933 Act, the information omitted from the form of prospectus
filed as part of this registration statement in reliance upon
Rule 430A and contained in a form of prospectus filed by the
registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the
1933 Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(3) That, for the purpose of determining any liability
under the 1933 Act, each post-effective amendment that contains a
form of prospectus shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(4) That, insofar as indemnification for liabilities
arising under the 1933 Act may be permitted to directors,
officers and controlling persons of the registrant pursuant to
the provisions described under Item 15 above, or otherwise, the
registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of
the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly
caused this amendment to the registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City
of New York, State of New York, on March 11, 1996.
MINNESOTA POWER & LIGHT COMPANY
(Registrant)
By /s/ Robert J. Reger, Jr.
------------------------
Robert J. Reger, Jr.
(Attorney-In-Fact)
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the
following persons in the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Edwin L. Russell*
---------------------
Edwin L. Russell President, March 11, 1996
President, Chief Executive Officer
Chief Executive Officer and Director
and Director
/s/ D. G. Gartzke*
------------------
D. G. Gartzke Senior Vice President- March 11, 1996
Senior Vice President- Finance and
Finance and Chief Financial Officer
Chief Financial Officer
/s/ Mark A. Schober*
--------------------
Mark A. Schober Corporate Controller March 11, 1996
Corporate Controller
Merrill K. Cragun* Director March 11, 1996
Dennis E. Evans* Director March 11, 1996
Sister Kathleen Hofer* Director March 11, 1996
D. Michael Hockett* Director March 11, 1996
Peter J. Johnson* Director March 11, 1996
Jack R. Kelly, Jr.* Director March 11, 1996
Paula F. McQueen* Director March 11, 1996
Robert S. Nickoloff* Director March 11, 1996
Jack I. Rajala* Director March 11, 1996
Charles A. Russell* Director March 11, 1996
Arend J. Sandbulte* Chairman and Director March 11, 1996
Nick Smith* Director March 11, 1996
Bruce W. Stender* Director March 11, 1996
Donald C. Wegmiller* Director March 11, 1996
*By: /s/ Robert J. Reger, Jr.
-----------------------------
Robert J. Reger, Jr.
(Attorney-In-Fact)
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly
caused this amendment to the registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City
of Duluth, State of Minnesota, on March 11, 1996.
MP&L Capital I
By: /s/ Philip R. Halverson
-----------------------
Philip R. Halverson
EXHIBIT INDEX
Exhibit Description
------- -----------
1(a) Form of Underwriting Agreement
4(b) Form of Amended and Restated Trust
Agreement relating to the Preferred
Securities
4(c) Form of Indenture relating to the
Junior Subordinated Debentures
4(d) Form of Guarantee Agreement
4(f) Form of Officer's Certificate
establishing Debentures
23(a) Consent of Price Waterhouse LLP
23(b) Consnet of Ernst & Young LLP
Exhibit 1(a)
MP&L CAPITAL I
_____% CUMULATIVE QUARTERLY INCOME PREFERRED SECURITIES
(QUIPSSM)*
(LIQUIDATION PREFERENCE $25.00 PER PREFERRED SECURITY)
____________
UNDERWRITING AGREEMENT
----------------------
March __, 1996
Goldman, Sachs & Co.,
PaineWebber Incorporated
As Representatives of the several Underwriters
named in Schedule I hereto,
c/o Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Ladies and Gentlemen:
MP&L Capital I, a Delaware statutory business trust ("MP&L
Capital"), and Minnesota Power & Light Company, a Minnesota
corporation (the "Company"), as depositor of MP&L Capital and as
guarantor, propose, subject to the terms and conditions stated
herein, to issue and sell to the Underwriters named in Schedule I
hereto (the "Underwriters") an aggregate of _______ of the
Preferred Securities specified above (each a "Security" and
collectively the "Securities") representing undivided preferred
beneficial interests in the assets of MP&L Capital, guaranteed on
a subordinated basis by the Company as to the payment of
distributions, and as to payments on liquidation or redemption,
to the extent set forth in a guarantee agreement (the
"Guarantee") between the Company and The Bank of New York, as
trustee (the "Guarantee Trustee"). MP&L Capital is to invest the
proceeds of the sale of the Securities and _______ of its Common
Securities (liquidation amount $25 per common security) (the
"Common Securities") in _____% Junior Subordinated Debentures,
Series ___, Due _________, ____ (the "Junior Subordinated
Debentures") to be issued pursuant to an Indenture (the
"Indenture") between the Company and The Bank of New York, as
trustee (the "Debenture Trustee").
1. Each of MP&L Capital and the Company, jointly and
severally, represents and warrants to, and agrees with, each of
the Underwriters that:
--------------------
* QUIPS is a servicemark of Goldman, Sachs & Co.
(a) A registration statement on Form S-3 (File Nos.
333-01035 and 333-01035-01) in respect of the Securities, the
Expense Agreement (as defined herein), the Guarantee and the
Junior Subordinated Debentures (collectively, the "Registered
Securities") has been filed with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933,
as amended (the "Act"); such registration statement, as amended
by any amendment thereto, and any post-effective amendment
thereto, each in the form heretofore delivered to you, and,
excluding exhibits thereto but including all documents
incorporated by reference in the prospectus contained therein, to
you for each of the other Underwriters, have been declared
effective by the Commission in such form; no other document with
respect to such registration statement, as amended by any
amendment thereto, or document incorporated by reference therein
has heretofore been filed with the Commission; and no stop order
suspending the effectiveness of such registration statement, as
amended by any amendment thereto, has been issued and no
proceeding for that purpose has been initiated or threatened by
the Commission (any preliminary prospectus included in such
registration statement, as amended by any amendment thereto, or
filed with the Commission pursuant to Rule 424(a) of the rules
and regulations of the Commission under the Act is hereinafter
called a "Preliminary Prospectus"; the various parts of such
registration statement, as amended by any amendment thereto,
including all exhibits thereto but excluding Form T-1 and
including (i) the information contained in the form of final
prospectus filed with the Commission pursuant to Rule 424(b)
under the Act in accordance with Section 5(a) hereof and deemed
by virtue of Rule 430A under the Act to be part of the
registration statement at the time it was declared effective and
(ii) the documents incorporated by reference in the prospectus
contained in the registration statement at the time such part of
the registration statement became effective, each as amended at
the time such part of the registration statement became
effective, is hereinafter collectively called the "Registration
Statement"; such final prospectus, in the form first filed
pursuant to Rule 424(b) under the Act, is hereinafter called the
"Prospectus"; and any reference herein to any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant
to Item 12 of Form S-3 under the Act, as of the date of such
Preliminary Prospectus or Prospectus, as the case may be; and any
reference to any amendment or supplement to any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and
include any documents filed after the date of such Preliminary
Prospectus or Prospectus, as the case may be, under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and incorporated by reference in such Preliminary Prospectus or
Prospectus, as the case may be; and any reference to any
amendment to the Registration Statement shall be deemed to refer
to and include any annual report of the Company filed pursuant to
Section 13(a) or 15(d) of the Exchange Act after the effective
date of the Registration Statement that is incorporated by
reference in the Registration Statement);
(b) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission, and
each Preliminary Prospectus, at the time of filing thereof,
conformed in all material respects to the requirements of the Act
and the rules and regulations of the Commission thereunder, and
did not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided, however,
that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity
with information furnished in writing to MP&L Capital and the
Company by an Underwriter through Goldman, Sachs & Co. expressly
for use therein;
(c) The documents incorporated by reference in the
Prospectus, when they became effective or were filed with the
Commission, as the case may be, conformed in all material
respects to the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission
thereunder, and such documents taken together as a whole did not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make
the statements therein not misleading; and any further documents
so filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto, when such documents
become effective or are filed with the Commission, as the case
may be, will conform in all material respects to the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and taken together with
all other documents incorporated by reference will not contain an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with
information furnished in writing to MP&L Capital or the Company
by an Underwriter through Goldman, Sachs & Co. expressly for use
therein;
(d) The Registration Statement conforms, and the
Prospectus and any further amendments or supplements to the
Registration Statement or the Prospectus will conform, in all
material respects to the requirements of the Act and the Trust
Indenture Act of 1939, as amended (the "TIA") and the rules and
regulations of the Commission thereunder and do not and will not,
as of the applicable effective date as to the Registration
Statement and any amendment thereto, and as of the applicable
filing date as to the Prospectus and any amendment or supplement
thereto, contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or
necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to MP&L
Capital or the Company by an Underwriter through Goldman, Sachs &
Co. expressly for use therein;
(e) Neither MP&L Capital nor the Company and its
subsidiaries, taken together as a whole, has sustained since the
date of the latest audited financial statements included or
incorporated by reference in the Prospectus any material loss or
interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Prospectus;
since the respective dates as of which information is given in
the Registration Statement and the Prospectus, there has not been
any change in the capital stock (other than shares issued under
the Company's Automatic Dividend Reinvestment and Stock Purchase
Plan, the Minnesota Power and Affiliated Companies Employee Stock
Purchase Plan or any compensation plan disclosed in the Company's
Proxy Statement with respect to the Company's 1995 Annual Meeting
of Shareholders (collectively, the "Stock Purchase and
Compensation Plans")) or long-term debt of the Company and its
subsidiaries, taken together as a whole, in excess of
$20,000,000, or any material adverse change, or any development
involving, so far as the Company can now reasonably force, a
prospective material adverse change, in or affecting the business,
management, financial position, common and preferred stock equity
or results of operations of MP&L Capital or the Company and its
subsidiaries, taken together as a whole, otherwise than as set
forth or contemplated in the Prospectus;
(f) The Company and its Material Subsidiaries (as
defined below) have good and marketable title in fee simple to
all real property and good and marketable title to all personal
property owned by them, in each case free and clear of all liens,
encumbrances and defects except such as are described in the
Prospectus or such as do not materially affect the value of such
property and do not interfere with the use made and proposed to
be made of such property by the Company and its Material
Subsidiaries; and any real property and buildings held under
lease by the Company and its Material Subsidiaries are held by
them under valid, subsisting and enforceable leases with such
exceptions as are not material and do not interfere with the use
made and proposed to be made of such property and buildings by
the Company and its subsidiaries (as used in this Agreement, the
term "Material Subsidiary" means a significant subsidiary under
Rule 1-02(w) of Regulation S-X of the Commission);
(g) MP&L Capital has been duly created and is validly
existing as a statutory business trust in good standing under the
Business Trust Act of the State of Delaware (the "Delaware
Business Trust Act") with the power and authority (trust and
other) to own property and conduct its business as described in
the Prospectus, and has conducted and will conduct no business
other than the transactions contemplated by this Agreement and
described in the Prospectus; MP&L Capital is not a party to or
bound by any agreement or instrument other than this Agreement,
the trust agreement (as amended and restated from time to time,
the "Trust Agreement") between the Company and the trustees named
therein (the "Trustees") and the agreements and instruments
contemplated by the Trust Agreement and described in the
Prospectus; MP&L Capital has no liabilities or obligations other
than those arising out of the transactions contemplated by this
Agreement and the Trust Agreement and described in the
Prospectus; and MP&L Capital is not a party to or subject to any
action, suit or proceeding of any nature;
(h) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws
of Minnesota, with power and authority (corporate and other) to
own its properties and conduct its business as described in the
Prospectus, and there is no jurisdiction wherein the character of
the properties owned or held under lease by the Company or the
nature of the business transacted by the Company would expose the
Company to any material liability or disability by reason of the
failure to qualify the Company as a foreign corporation in any
such jurisdiction; and each Material Subsidiary of the Company
has been duly incorporated and is validly existing as a
corporation in good standing under the laws of its jurisdiction
of incorporation, and there is no jurisdiction wherein the
character of the properties owned or held under lease by any
Material Subsidiary or the nature of the business transacted by
such Material Subsidiary would expose such Material Subsidiary to
any material liability or disability by reason of the failure to
qualify such Material Subsidiary as a foreign corporation in any
such jurisdiction;
(i) The Company has the authorized equity capital as
set forth in the Prospectus; and all of the issued shares of
capital stock of each subsidiary of the Company are owned
directly or indirectly by the Company, free and clear of all
liens, encumbrances, equities or claims;
(j) The Securities have been duly and validly
authorized by MP&L Capital, and, when issued and delivered
against payment therefor as provided herein, will be duly and
validly issued and fully paid and non-assessable undivided
beneficial interests in the assets of MP&L Capital and will
conform to the description thereof contained in the Prospectus;
the issuance of the Securities is not subject to preemptive or
other similar rights; the Securities will have the rights set
forth in the Trust Agreement, and the terms of the Securities are
valid and binding on MP&L Capital; the holders of the Securities
(the "Securityholders") will be entitled to the same limitation
of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation
Law of the State of Delaware;
(k) The Common Securities have been duly and validly
authorized by MP&L Capital, and, when delivered to the Company by
MP&L Capital against payment therefor as provided in the
Prospectus, will be duly and validly issued undivided beneficial
interests in the assets of MP&L Capital and will conform to the
description thereof contained in the Prospectus; the issuance of
the Common Securities is not subject to preemptive or other
similar rights;and at the Time of Delivery (as defined in Section
4 hereof), all of the issued and outstanding Common Securities of
MP&L Capital will be directly owned by the Company, free and
clear of all liens, encumbrances, equities or claims; and the
Common Securities and the Securities are the only interests
authorized to be issued by MP&L Capital;
(l) The Company has filed a Petition for Certification
of Capital Structure with the Minnesota Public Utilities
Commission ("Minnesota Commission") pursuant to the Minnesota
Public Utilities Act with respect to the issuance and sale by the
Company of the Junior Subordinated Debentures and the Guarantee.
The Minnesota Commission has entered an authorizing order (the
"Authorizing Order") approving the capital structure including
the issuance and sale of the Junior Subordinated Debentures and
the Guarantee;
(m) The Guarantee, the Junior Subordinated Debentures,
the Trust Agreement, the Agreement as to Expenses and Liabilities
between the Company and MP&L Capital (the "Expense Agreement")
and the Indenture (collectively, the "Company Agreements") have
each been duly authorized and when validly executed and delivered
by the Company and, in the case of the Guarantee, by the
Guarantee Trustee, in the case of the Trust Agreement, by the
Trustees and, in the case of the Indenture, by the Debenture
Trustee, and, in the case of the Junior Subordinated Debentures,
when validly authenticated and delivered by the Debenture
Trustee, will constitute valid and legally binding obligations of
the Company, enforceable in accordance with their respective
terms, subject, as to enforcement, to bankruptcy, insolvency,
moratorium, reorganization and similar laws of general
applicability relating to or affecting creditors' rights and to
general equity principles (whether considered at a proceeding in
equity or at law); the Trust Agreement, the Indenture and the
Guarantee have been duly qualified under the TIA; the Junior
Subordinated Debentures are entitled to the benefits of the
Indenture; and the Company Agreements will conform to the
descriptions thereof in the Prospectus;
(n) The issue and sale of the Securities and the
Common Securities by MP&L Capital, the compliance by MP&L Capital
with all of the provisions of this Agreement, the purchase of the
Junior Subordinated Debentures by MP&L Capital, the distribution
of the Junior Subordinated Debentures by MP&L Capital in the
circumstances contemplated by the Trust Agreement and the
consummation of the transactions contemplated herein and in the
Trust Agreement will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a
default under, any agreement or instrument to which MP&L Capital
is a party or by which MP&L Capital is bound or to which any of
the property or assets of MP&L Capital is subject, nor will such
actions result in any violation of the provisions of the Trust
Agreement or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over
MP&L Capital or any of its properties; and no consent, approval,
authorization, order, registration or qualification of or with
any such court or governmental agency or body is required for the
issue and sale of the Securities and the Common Securities by
MP&L Capital, the purchase of the Junior Subordinated Debentures
by MP&L Capital or the consummation by MP&L Capital of the
transactions contemplated by this Agreement and the Trust
Agreement, except the registration under the Act and the Exchange
Act of the Registered Securities, the qualification of the Trust
Agreement, the Indenture and the Guarantee under the TIA, and
such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue
Sky laws in connection with the purchase and distribution of the
Securities by the Underwriters;
(o) The issue and sale of the Securities and the
Common Securities by MP&L Capital, the issuance by the Company of
the Guarantee, the compliance by the Company and MP&L Capital
with all of the provisions of this Agreement, the execution,
delivery and performance by the Company of the Company
Agreements, the distribution of the Junior Subordinated
Debentures by MP&L Capital in the circumstances contemplated by
the Trust Agreement and the consummation of the transactions
herein and therein contemplated will not conflict with or result
in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which
the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries is bound or to which any of
the property or assets of the Company or any of its subsidiaries
is subject except for such conflict, breach, violation or default
which does not have a material adverse effect on the business,
management, financial position, common and preferred stock equity
or results of operations of the Company and its subsidiaries,
taken together as a whole (hereinafter, a "Material Adverse
Effect"), nor will such action require a consent or approval of
any holder of the Company's capital stock or result in any
violation of the provisions of the Articles of Incorporation or
By-laws of the Company or the charter or by-laws or any other
organizational document of any of its Material Subsidiaries or
any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company
or any of its Material Subsidiaries or any of their respective
properties;
(p) No consent, approval, authorization or order of,
or any filing or declaration with, any court or governmental
agency or body is required for the issue of the Guarantee, the
issuance and sale of the Junior Subordinated Debentures, the
distribution of the Junior Subordinated Debentures by MP&L
Capital in the circumstances contemplated by the Trust Agreement
or the consummation by the Company of the other transactions
contemplated by this Agreement and the Company Agreements, except
the registration under the Act of the Registered Securities and
the qualification of the Trust Agreement, the Indenture and the
Guarantee under the TIA, the entry of the Authorizing Order of
the Minnesota Commission, and such consents, approvals,
authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection
with the purchase of the Securities and distribution of the
Securities by the Underwriters;
(q) Other than as set forth in the Prospectus, there
are no legal or governmental proceedings pending to which the
Company or any of its subsidiaries is a party or to which any
property of the Company or any of its subsidiaries is subject,
which, if determined adversely to the Company or any of its
subsidiaries would individually or in the aggregate have a
Material Adverse Effect; and, to the best of the Company's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(r) There are no legal or governmental proceedings
pending to which MP&L Capital is a party or to which any property
of MP&L Capital is subject; and, to the best of MP&L Capital's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(s) Neither MP&L Capital nor the Company is nor, after
giving effect to the offering and sale of the Securities, will be
an "investment company" or an entity "controlled" by an
"investment company", as such terms are defined in the Investment
Company Act of 1940, as amended (the "Investment Company Act");
and
(t) Neither the Company nor any of its affiliates does
business with the government of Cuba or with any person or
affiliate located in Cuba within the meaning of Section 517.075,
Florida Statutes.
2. Subject to the terms and conditions herein set forth,
MP&L Capital and the Company agree that MP&L Capital will issue
and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from
MP&L Capital, at a purchase price of $25 per Security, the number
of the Securities set forth opposite the name of such Underwriter
in Schedule I hereto.
As compensation to the Underwriters for their commitments
hereunder, and in view of the fact that the proceeds from the
sale of the Securities will be used by MP&L Capital to purchase
the Junior Subordinated Debentures of the Company, the Company at
the Time of Delivery will pay by wire transfer of federal (same
day) funds to Goldman, Sachs & Co., for the accounts of the
several Underwriters, an amount equal to $_________ per Security
to be delivered by the Company hereunder at the Time of Delivery.
3. Upon the authorization by you of the release of the
Securities, the several Underwriters propose to offer the
Securities for sale upon the terms and conditions set forth in
the Prospectus.
4. (a) The Securities to be purchased by each Underwriter
hereunder will be represented by one or more definitive
global Securities in book-entry form which will be deposited
by or on behalf of MP&L Capital with The Depository Trust
Company ("DTC") or its designated custodian. MP&L Capital
will deliver the Securities to Goldman, Sachs & Co., for the
account of each Underwriter, against payment by or on behalf
of such Underwriter of the purchase price therefor by wire
transfer, payable to the order of MP&L Capital in federal
(same day) funds, by causing DTC to credit the Securities to
the account of Goldman, Sachs & Co. at DTC. MP&L Capital
will cause the certificates representing the Securities to
be made available to Goldman, Sachs & Co. for checking at
least twenty-four hours prior to the Time of Delivery (as
defined below) at the office of DTC or its designated
custodian (the "Designated Office"). The time and date of
such delivery and payment shall be 10:00 a.m., New York City
time, on March __, 1996, or such other time and date as
Goldman, Sachs & Co. and the Company may agree upon in
writing. Such time and date are herein called the "Time of
Delivery".
(b) The documents to be delivered at the Time of
Delivery by or on behalf of the parties hereto pursuant to
Section 7 hereof, including the cross-receipt for the
Securities and any additional documents requested by the
Underwriters pursuant to Section 7(i) hereof will be
delivered at the offices of Reid & Priest LLP, 40 West 57th
Street, New York, New York (the "Closing Location"), and the
Securities will be delivered at the Designated Office, all
at the Time of Delivery. A meeting will be held at the
Closing Location at 2:00 p.m., New York City time, on the
New York Business Day next preceding the Time of Delivery,
at which meeting the final drafts of the documents to be
delivered pursuant to the preceding sentence will be
available for review by the parties hereto. For the
purposes of this Section 4, "New York Business Day" shall
mean each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York
are generally authorized or obligated by law or executive
order to close.
5. MP&L Capital and the Company, jointly and severally,
agree with each of the Underwriters:
(a) To prepare the Prospectus in a form reasonably
approved by you, and to file such Prospectus pursuant to
Rule 424(b) under the Act not later than the Commission's
close of business on the second business day following the
execution and delivery of this Agreement, or, if applicable,
such earlier time as may be required by Rule 430A(a)(3)
under the Act; to make no further amendment or any
supplement to the Registration Statement or Prospectus prior
to the Time of Delivery which shall be reasonably
disapproved by you promptly after reasonable notice thereof;
to advise you, promptly after it receives notice thereof, of
the time when any amendment to the Registration Statement
has been filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed and to
furnish you with copies thereof; in the case of the Company,
to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company
with the Commission pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of the
Prospectus and for so long as the delivery of a prospectus
is required in connection with the offering or sale of the
Securities; to advise you, promptly after it receives notice
thereof, of the issuance by the Commission of any stop order
or of any order preventing or suspending the use of any
Preliminary Prospectus or prospectus, of the suspension of
the qualification of the Registered Securities for offering
or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of
any request by the Commission for the amending or
supplementing of the Registration Statement or Prospectus or
for additional information; and, in the event of the
issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or
prospectus or suspending any such qualification, promptly to
use its best efforts to obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as
you may reasonably request to qualify the Registered
Securities for offering and sale under the securities laws
of such jurisdictions as you may request and to comply with
such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be
necessary to complete the distribution of the Securities,
provided that in connection therewith neither MP&L Capital
nor the Company shall be required to qualify as a foreign
corporation or to file a general consent to service of
process in any jurisdiction;
(c) To use its best efforts to furnish the
Underwriters, prior to 10:00 a.m., New York City time, on
the New York Business Day next succeeding the date of this
Agreement and from time to time, with copies of the
Prospectus in New York City in such quantities as you may
reasonably request, and, if the delivery of a prospectus is
required at any time prior to the expiration of nine months
after the time of issue of the Prospectus in connection with
the offering or sale of the Securities and if at such time
any event shall have occurred as a result of which the
Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made when such Prospectus is delivered, not misleading,
or, if for any other reason it shall be necessary during
such period to amend or supplement the Prospectus or to file
under the Exchange Act any document incorporated by
reference in the Prospectus in order to comply with the Act,
the Exchange Act or the TIA, to notify you and upon your
reasonable request to file such amendment or supplement or
document and to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many copies
as you may from time to time reasonably request of an
amended Prospectus or a supplement to the Prospectus which
will correct such statement or omission or effect such
compliance, and in case any Underwriter is required to
deliver a prospectus in connection with sales of any of the
Securities at any time nine months or more after the time of
issue of the Prospectus, upon your request but at the
expense of such Underwriter, to prepare and deliver to such
Underwriter as many copies as you may request of an amended
or supplemented Prospectus complying with Section 10(a)(3)
of the Act;
(d) In the case of the Company, to make generally
available to its shareholders as soon as practicable, but in
any event not later than eighteen months after the effective
date of the Registration Statement (as defined in Rule
158(c) under the Act), an earnings statement of the Company
and its subsidiaries (which need not be audited) complying
with Section 11(a) of the Act and the rules and regulations
thereunder (including, at the option of the Company, Rule
158);
(e) During the period beginning from the date hereof
and continuing to and including the earlier of (i) the date,
after the Time of Delivery, on which the distribution of the
Securities ceases, as determined by you, and (ii) 90 days
after the Time of Delivery, not to offer, sell, contract to
sell or otherwise dispose of, any other beneficial interests
in MP&L Capital, or any other securities of MP&L Capital or
the Company, as the case may be, that are substantially
similar to the Securities (including any guarantee of such
Securities) or any securities that are convertible into or
exchangeable for, or that represent the right to receive,
any such substantially similar securities of either MP&L
Capital or the Company, without the prior written consent of
Goldman, Sachs & Co.; provided that this subclause (e) shall
specifically not apply to the Company's common stock,
preferred stock, secured indebtedness and unsecured
indebtedness which is not subordinated;
(f) During a period of two years from the effective
date of the Registration Statement, to furnish to you upon
your request copies of all reports or other communications
(financial or other) furnished to shareholders of the
Company, and to deliver to you upon your request as soon as
they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any
national securities exchange on which any class of
securities of MP&L Capital or the Company is listed;
(g) In the case of the Company, to issue the Guarantee
concurrently with the issue and sale of the Securities as
contemplated herein;
(h) To use the net proceeds received by it from the
sale of the Securities pursuant to this Agreement in the
manner specified in the Prospectus under the caption "Use of
Proceeds"; and
(i) To use its best efforts to list, subject to notice
of issuance, the Securities on the New York Stock Exchange.
6. The Company covenants and agrees with the several
Underwriters that the Company will pay or cause to be paid the
following: (i) the fees, disbursements and expenses of the
Company's counsel and accountants in connection with the
registration of the Registered Securities under the Act and all
other expenses in connection with the preparation, printing and
filing of the Registration Statement, any Preliminary Prospectus
and the Prospectus and amendments and supplements thereto and the
mailing and delivering of copies thereof to the Underwriters and
dealers; (ii) the cost of printing or producing any Agreement
among Underwriters, this Agreement, the Indenture, the Trust
Agreement, the Guarantee, the Blue Sky Memorandum, closing
documents (including any compilations thereof) and any other
documents in connection with the offering, purchase, sale and
delivery of the Registered Securities; (iii) all expenses in
connection with the qualification of the Registered Securities
for offering and sale under state securities laws as provided in
Section 5(b) hereof, including the fees (not to exceed $10,000)
and disbursements of counsel for the Underwriters in connection
with such qualification and in connection with the Blue Sky
Survey; (iv) any fees charged by securities rating services for
rating the Securities; (v) all fees and expenses in connection
with listing the Securities on the New York Stock Exchange and
the cost of registering the Securities under Section 12 of the
Exchange Act; the cost of preparing certificates for the
Securities and Junior Subordinated Debentures; (vii) the cost and
charges of any transfer agent or registrar; (viii) the cost and
charges of qualifying the Securities with DTC; (ix) the fees and
expenses of the Trustees, the Debenture Trustee and the Guarantee
Trustee and any agent thereof and the fees and disbursements of
their counsel; and (x) all other costs and expenses incident to
the performance of its obligations hereunder which are not
otherwise specifically provided for in this Section. It is
understood, however, that, except as provided in this Section,
and Sections 8 and 11 hereof, the Underwriters will pay all of
their own costs and expenses, including the fees of their
counsel, stock transfer taxes on resale of any of the Securities
by them, and any advertising expenses connected with any offers
they may make.
7. The obligations of the Underwriters hereunder shall be
subject, in their discretion, to the condition that all
representations and warranties and other statements of MP&L
Capital and the Company herein are, at and as of the Time of
Delivery, true and correct, the condition that MP&L Capital and
the Company shall have performed all of their respective
obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) The Prospectus shall have been filed with the
Commission pursuant to Rule 424(b) within the applicable
time period prescribed for such filing by the rules and
regulations under the Act and in accordance with Section
5(a) hereof; no stop order suspending the effectiveness of
the Registration Statement or any part thereof shall have
been issued and no proceeding for that purpose shall have
been initiated or threatened by the Commission; and all
requests for additional information on the part of the
Commission shall have been complied with to your reasonable
satisfaction;
(b) Lane & Mittendorf LLP, counsel for the
Underwriters, shall have furnished to you such opinion or
opinions (a draft of each such opinion is attached as Annex
II(a) hereto), dated the Time of Delivery, with respect to
the formation of MP&L Capital, insofar as the federal laws
of the United States and the laws of the State of New York
or the State of Delaware are concerned; the validity of the
Registered Securities, the Registration Statement and the
Prospectus; and other related matters as you may reasonably
request, and such counsel shall have received such papers
and information as they may reasonably request to enable
them to pass upon such matters; provided that in rendering
such opinion, Lane & Mittendorf LLP may rely on the opinion
of Richards, Layton & Finger delivered pursuant to
subsection (e) hereof as to matters of Delaware law relating
to statutory business trusts;
(c) Philip R. Halverson, Esq., general counsel of the
Company, shall have furnished to you his written opinion (a
draft of such opinion is attached as Annex II(b) hereto) (in
rendering such opinion, such counsel may rely on the opinion
of Richards, Layton & Finger delivered pursuant to
subsection (e) hereof as to matters of Delaware law relating
to statutory business trusts), dated the Time of Delivery,
in form and substance satisfactory to you, to the effect
that:
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Minnesota with power and authority
(corporate and other) to own its properties and conduct its
business as described in the Prospectus;
(ii) The Company is a public utility corporation
duly authorized by its Articles of Incorporation to conduct
the business which it is now conducting as set forth in the
Prospectus and the Company holds valid and subsisting
franchises, licenses and permits authorizing it to carry on
the utility business in which it is engaged;
(iii) The Company has the authorized equity
capital as set forth in the Prospectus; and the Securities
conform to the description of the Securities contained in
the Prospectus;
(iv) There is no jurisdiction wherein the
character of the properties owned or held under lease by the
Company or the nature of the business transacted by the
Company would expose the Company to any material liability
or disability by reason of the failure to qualify the
Company as a foreign corporation in any such jurisdiction;
(such counsel being entitled to rely in respect of the
opinion in this clause upon opinions of local counsel and in
respect of matters of fact upon certificates of officers of
the Company, provided that such counsel shall state that
such counsel believes that both you and such counsel are
justified in relying upon such opinions and certificates);
(v) Each Material Subsidiary of the Company has
been duly incorporated and is validly existing as a
corporation in good standing under the laws of its
jurisdiction of incorporation, and there is no jurisdiction
wherein the character of the properties owned or held under
lease by any Material Subsidiary or the nature of the
business transacted by such Material Subsidiary would expose
such Material Subsidiary to any material liability or
disability by reason of the failure to qualify such Material
Subsidiary as a foreign corporation in any such
jurisdiction; and other than as set forth in the Prospectus
all of the issued shares of capital stock of each such
subsidiary are owned directly or indirectly by the Company,
free and clear of all liens, encumbrances, equities or
claims (such counsel being entitled to rely in respect of
the opinion in this clause upon opinions of local counsel
and in respect to matters of fact upon certificates of
officers of the Company or its subsidiaries; provided that
such counsel shall state that such counsel believes that
both you and such counsel are justified in relying upon such
opinions and certificates);
(vi) To the best of such counsel's knowledge and
other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the
Company or any of its subsidiaries is a party or of which
any property of the Company or any of its subsidiaries is
the subject which, if determined adversely to the Company or
any of its subsidiaries, would individually or in the
aggregate have a Material Adverse Effect; and, to the best
of such counsel's knowledge, no such proceedings are
threatened or overtly contemplated by governmental
authorities or threatened by others;
(vii) To the best of such counsel's knowledge,
there are no legal or governmental proceedings pending to
which MP&L Capital is a party or of which any property of
MP&L Capital is the subject; and, to the best of such
counsel's knowledge, no such proceedings are threatened or
overtly contemplated by governmental authorities or
threatened others;
(viii) This Agreement has been duly authorized,
executed and delivered by each of MP&L Capital and the
Company;
(ix) The Company Agreements have each been duly
authorized, executed and delivered by the Company and each
of the Company Agreements constitutes a valid and legally
binding obligation of the Company, enforceable against the
Company in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and
other laws relating to or affecting creditors' rights and to
general equitable principles (whether considered at a
proceeding in equity or at law); the Junior Subordinated
Debentures are entitled to the benefits provided by the
Indenture;
(x) The issue and sale of the Securities and the
Common Securities by MP&L Capital, the issuance by the
Company of the Guarantee and the Junior Subordinated
Debentures, the compliance by the Company and MP&L Capital
with all of the provisions of this Agreement, the execution,
delivery and performance by the Company of the Company
Agreements, the distribution of the Junior Subordinated
Debentures by MP&L Capital in the circumstances contemplated
by the Trust Agreement and the consummation of the
transactions herein and therein contemplated will not (i)
conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument known to such counsel to which
the Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries is bound or to
which any of the property or assets of the Company or any of
its subsidiaries is subject except for such conflict,
breach, violation or default which does not have a Material
Adverse Effect, nor (ii) will such action result in any
violation of the provisions of the Articles of Incorporation
or By-laws of the Company or any statute or any order, rule
or regulation known to such counsel of any court or
governmental agency or body having jurisdiction over the
Company or any of its Material Subsidiaries or any of their
respective properties;
(xi) The issue and sale of the Securities and the
Common Securities by MP&L Capital, the compliance by MP&L
Capital with all of the provisions of this Agreement, the
purchase of the Junior Subordinated Debentures by MP&L
Capital, the distribution of the Junior Subordinated
Debentures by MP&L Capital in the circumstances contemplated
by the Trust Agreement and the consummation of the
transactions contemplated herein and in the Trust Agreement
will not conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default
under, any agreement or instrument to which MP&L Capital is
a party or by which MP&L Capital is bound or to which any of
the property or assets of MP&L Capital is subject, nor will
such action result in any violation of the provisions of the
Trust Agreement or any statute or any order, rule or
regulation of any court or governmental agency or body
having jurisdiction over MP&L Capital or any of its
properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or
governmental agency or body is required for the issue and
sale of the Securities and the Common Securities by MP&L
Capital, the purchase of the Junior Subordinated Debentures
by MP&L Capital or the consummation by MP&L Capital of the
transactions contemplated by this Agreement and the Trust
Agreement, except the registration under the Act and the
Exchange Act of the Registered Securities, the qualification
of the Trust Agreement, the Indenture and the Guarantee
under the TIA, and such consents, approvals, authorizations,
registrations or qualifications as may be required under
state securities or Blue Sky laws in connection with the
purchase and distribution of the Securities by the
Underwriters;
(xii) No consent, approval, authorization,
order, registration or qualification of or with any court or
governmental agency or body having jurisdiction over the
Company or any of its properties is required for the issue
of the Guarantee, the issuance and sale of the Junior
Subordinated Debentures, the distribution of the Junior
Subordinated Debentures by MP&L Capital in the circumstances
contemplated by the Trust Agreement or the consummation by
the Company of the transactions contemplated herein and in
the Company Agreements, except the registration under the
Act of the Registered Securities, the qualification of the
Trust Agreement, the Indenture and the Guarantee under the
TIA, the entry of the Authorizing Order of the Minnesota
Commission, and such consents, approvals, authorizations,
registrations or qualifications as may be required under
state securities or Blue Sky laws in connection with the
purchase and distribution of the Securities by the
Underwriters;
(xiii) The statements set forth in the
Prospectus under the captions "Description of the Preferred
Securities", "Description of the Guarantee" and "Description
of the Junior Subordinated Debentures", insofar as they
purport to constitute a summary of the terms of the
securities, documents and instruments therein described, are
accurate and fairly present the information contained
therein in all material respects;
(xiv) The documents incorporated by reference
in the Prospectus or any further amendment or supplement
thereto made by MP&L Capital or the Company prior to the
Time of Delivery (other than the financial statements and
related schedules therein, as to which such counsel need
express no opinion), when they became effective or were
filed with the Commission, as the case may be, complied as
to form in all material respects with the requirements of
the Exchange Act and the rules and regulations of the
Commission thereunder; and such counsel has no reason to
believe that such documents when such documents became
effective or were so filed, as the case may be, taken
together as a whole contained, in the case of a registration
statement which became effective under the Act, an untrue
statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading, or in the case of other
documents which were filed under the Exchange Act with the
Commission, an untrue statement of a material fact or
omitted to state a material fact necessary in order to make
the statements therein, in the light of the circumstances
under which they were made when such documents were so
filed, not misleading; and
(xv) The Registration Statement and the Prospectus
and any further amendments and supplements thereto made by
the Company prior to the Time of Delivery (other than the
financial statements and related schedules and other
financial or statistical data contained therein, as to which
such counsel need express no opinion) comply as to form in
all material respects with the requirements of the Act and
the TIA and the rules and regulations thereunder; although
such counsel does not assume any responsibility for the
accuracy, completeness or fairness of the statements
contained in the Registration Statement or the Prospectus,
except for those referred to in the opinion in subsection
(xiii) of this section 7(c), such counsel has no reason to
believe that, as of its effective date, the Registration
Statement or any further amendment thereto, as of its
effective date, made by MP&L Capital or the Company prior to
the Time of Delivery (other than the financial statements
and related schedules and other financial or statistical
data contained therein, as to which such counsel need
express no opinion) contained an untrue statement of a
material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements
therein not misleading or that, as of its date, the
Prospectus or any further amendment or supplement thereto
made by MP&L Capital or the Company prior to the Time of
Delivery (other than the financial statements and related
schedules and other financial or statistical data contained
therein, as to which such counsel need express no opinion)
contained an untrue statement of a material fact or omitted
to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they
were made, not misleading or that, as of the Time of
Delivery, the Prospectus or any further amendment or
supplement thereto made by the Company prior to the Time of
Delivery (other than the financial statements and related
schedules and other financial or statistical data contained
therein, as to which such counsel need express no opinion)
contains an untrue statement of a material fact or omits to
state a material fact necessary to make the statements
therein, in the light of the circumstances under which they
were made, not misleading;
(d) Reid & Priest LLP, counsel for the Company, shall
have furnished to you their written opinion (a draft of such
opinion is attached as Annex II(c) hereto) (in rendering
such opinion, such counsel may rely on the opinion of
Richards, Layton & Finger delivered pursuant to subsection
(e) hereof as to matters of Delaware law relating to
statutory business trusts), dated the Time of Delivery, in
form and substance satisfactory to you, to the effect that:
(i) This Agreement has been duly authorized,
executed and delivered by the Company and each of this
Agreement and the Expense Agreement has been duly
authorized, executed and delivered by MP&L Capital;
(ii) The Company Agreements have each been duly
authorized, executed and delivered by the Company and each
of the Company Agreements constitutes a valid and legally
binding obligation of the Company, enforceable against the
Company in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and
other laws relating to or affecting creditors' rights and to
general equitable principles (whether considered at a
proceeding in equity or at law); the Trust Agreement, the
Indenture and the Guarantee have been duly qualified under
the TIA; the Junior Subordinated Debentures are entitled to
the benefits provided by the Indenture;
(iii) The Securities, the Common Securities
and the Junior Subordinated Debentures conform as to legal
matters to the descriptions thereof contained in the
Prospectus;
(iv) No consent, approval, authorization, order,
registration or qualification of or with any such court or
governmental agency or body is required for the issue of the
Guarantee, the issuance and sale of the Junior Subordinated
Debentures, the distribution of the Junior Subordinated
Debentures by MP&L Capital in the circumstances contemplated
by the Trust Agreement or the consummation by the Company of
the transactions contemplated herein and in the Company
Agreements, except the registration under the Act of the
Registered Securities, the qualification of the Trust
Agreement, the Indenture and the Guarantee under the TIA,
the entry of the Authorizing Order of the Minnesota
Commission, and such consents, approvals, authorizations,
registrations or qualifications as may be required under
state securities or Blue Sky laws in connection with the
purchase and distribution of the Securities by the
Underwriters;
(v) The statements set forth in the Prospectus
under the captions "Description of Preferred Securities,"
"Description of the Guarantee" and "Description of the
Junior Subordinated Debentures," insofar as they purport to
constitute a summary of the terms of the securities,
documents and instruments therein described, and under the
captions "Certain United States Income Tax Considerations,"
insofar as they purport to describe the provisions of the
laws and documents referred to therein, are accurate and
fairly present the information contained therein in all
material respects;
(vi) Neither MP&L Capital nor the Company is an
"investment company" or an entity "controlled" by an
"investment company", as such terms are defined in the
Investment Company Act; and
(vii) The Registration Statement and the
Prospectus and any further amendments and supplements
thereto made by the Company prior to the Time of Delivery
(other than the financial statements and related schedules
and other financial or statistical data contained therein,
as to which such counsel need express no opinion) comply as
to form in all material respects with the requirements of
the Act and the TIA and the rules and regulations
thereunder; although such counsel does not assume any
responsibility for the accuracy, completeness or fairness of
the statements contained in the Registration Statement or
the Prospectus, except for those referred to in the opinion
in subsection (xiii) of this section 7(c), such counsel has
no reason to believe that, as of its effective date, the
Registration Statement or any further amendment thereto made
by MP&L Capital or the Company prior to the Time of Delivery
(other than the financial statements and related schedules
and other financial or statistical data contained therein,
as to which such counsel need express no opinion) contained
an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to
make the statements therein not misleading or that, as of
its date, the Prospectus or any further amendment or
supplement thereto made by MP&L Capital or the Company prior
to the Time of Delivery (other than the financial statements
and related schedules and other financial or statistical
data contained therein, as to which such counsel need
express no opinion) contained an untrue statement of a
material fact or omitted to state a material fact necessary
to make the statements therein, in the light of the
circumstances under which they were made, not misleading or
that, as of the Time of Delivery, the Prospectus or any
further amendment or supplement thereto made by the Company
prior to the Time of Delivery (other than the financial
statements and related schedules and other financial or
statistical data contained therein, as to which such counsel
need express no opinion) contains an untrue statement of a
material fact or omits to state a material fact necessary to
make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(e) Richards, Layton & Finger, special Delaware
counsel to MP&L Capital and the Company, shall have
furnished to you, the Company and MP&L Capital their written
opinion (a draft of such opinion is attached as Annex II(d)
hereto), dated the Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) MP&L Capital has been duly created and is
validly existing in good standing as a business trust under
the Delaware Business Trust Act, and all filings required
under the laws of the State of Delaware with respect to the
creation and valid existence of MP&L Capital as a business
trust have been made;
(ii) Under the Delaware Business Trust Act and the
Trust Agreement, MP&L Capital has the trust power and
authority to own property and conduct its business, all as
described in the Prospectus;
(iii) The Trust Agreement constitutes a valid
and binding obligation of the Company and the Trustees,
enforceable against the Company and the Trustees in
accordance with its terms, subject, as to enforcement, to
(a) bankruptcy, insolvency, moratorium, receivership,
liquidation, fraudulent conveyance, reorganization and other
similar laws relating to or affecting the remedies and
rights of creditors, (b) general principles of equity,
including applicable laws relating to fiduciary duties
(regardless of whether considered or applied in a proceeding
in equity or at law) and (c) the effect of applicable public
policy on the enforceability of provisions relating to
indemnification or contribution;
(iv) Under the Delaware Business Trust Act and the
Trust Agreement, MP&L Capital has the trust power and
authority (a) to execute and deliver, and to perform its
obligations under, this Agreement and (b) to issue and
perform its obligations under the Securities;
(v) Under the Delaware Business Trust Act and the
Trust Agreement, the execution and delivery by MP&L Capital
of this Agreement, and the performance by MP&L Capital of
its obligations hereunder, have been duly authorized by all
necessary trust action on the part of MP&L Capital;
(vi) The Securities have been duly authorized by
MP&L Capital and are duly and validly issued and, subject to
the qualifications set forth herein, fully paid and non-
assessable undivided beneficial interests in the assets of
MP&L Capital; the Securityholders, as beneficial owners of
MP&L Capital, will be entitled to the same limitation of
personal liability extended to stockholders of private
corporations for profit organized under the General
Corporation Law of the State of Delaware; provided that such
counsel may note that the Securityholders may be obligated,
pursuant to the Trust Agreement, to (a) provide indemnity
and/or security in connection with and pay a sum sufficient
to cover any taxes or governmental charges arising from
transfers or exchanges of Securities certificates and the
issuance of replacement Securities certificates and (b)
provide security and/or indemnity in connection with
requests of or directions to the Property Trustee (as
defined in the Trust Agreement) to exercise its rights and
powers under the Trust Agreement;
(vii) Under the Delaware Business Trust Act
and the Trust Agreement, the issuance of the Securities is
not subject to preemptive rights;
(viii) The issuance and sale by MP&L Capital of
the Securities, the execution, delivery and performance by
MP&L Capital of this Agreement, the consummation by MP&L
Capital of the transactions contemplated hereby and
compliance by MP&L Capital with its obligations hereunder do
not violate (a) any of the provisions of the Certificate of
Trust of MP&L Capital or the Trust Agreement, or (b) any
applicable Delaware law or administrative regulation;
(ix) Assuming that MP&L Capital derives no income
from or connected with sources within the State of Delaware
and has no assets, activities (other than having a Delaware
trustee as required by the Delaware Business Trust Act and
the filing of documents with the Secretary of State of the
State of Delaware) or employees in the State of Delaware, no
authorization, approval, consent or order of any Delaware
court or Delaware governmental authority or Delaware agency
is required to be obtained by MP&L Capital solely in
connection with the issuance and sale of the Securities; and
(x) Assuming that MP&L Capital derives no income
from or connected with sources within the State of Delaware
and has no assets, activities (other than having a Delaware
trustee as required by the Delaware Business Trust Act and
the filing of documents with the Secretary of State of the
State of Delaware) or employees in the State of Delaware,
and assuming that MP&L Capital is treated as a grantor trust
or partnership for federal income tax purposes, the
Securityholders (other than those holders of the Securities
who reside or are domiciled in the State of Delaware) will
have no liability for income taxes imposed by the State of
Delaware solely as a result of their participation in MP&L
Capital, and MP&L Capital will not be liable for any income
tax imposed by the State of Delaware (in rendering the
opinion expressed in this paragraph (e), such counsel need
express no opinion concerning the securities laws of the
State of Delaware);
(f) On the date of the Prospectus at a time prior to
the execution of this Agreement, on the effective date of
any post-effective amendment to the Registration Statement
containing financial information filed subsequent to the
date of this Agreement and also at the Time of Delivery,
Price Waterhouse LLP and Ernst & Young LLP shall have
furnished to you a letter or letters, dated the respective
dates of delivery thereof, in form and substance
satisfactory to you, to the effect set forth in Annex I
hereto (the executed copies of such letter or letters
delivered prior to execution of this Agreement are attached
as Annex I(a) hereto and drafts of the forms of letter or
letters to be delivered on the effective date of any post-
effective amendment to the Registration Statement and as of
the Time of Delivery are attached as Annex I(b) hereto);
(g) The Trust Agreement, the Guarantee and the
Indenture shall have been executed and delivered, in each
case in form reasonably satisfactory to you;
(h) (i) Neither MP&L Capital nor the Company and its
subsidiaries, taken together as a whole, shall have
sustained since the date of the latest audited financial
statements included or incorporated by reference in the
Prospectus any loss or interference with its business from
fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set
forth or contemplated in the Prospectus, and (ii) since the
respective dates as of which information is given in the
Prospectus there shall not have been any change in the
capital stock (other than shares issued under the Stock
Purchase and Compensation Plans) or long-term debt of the
Company and its subsidiaries, taken together as a whole, in
excess of $20,000,000, or any change, or any development
that could reasonably be expected to involve a prospective
change, in or affecting the business, management, financial
position, common or preferred stock equity or results of
operations of MP&L Capital or the Company and its
subsidiaries, taken together as a whole, otherwise than as
set forth or contemplated in the Prospectus, the effect of
which, in any such case described in Clause (i) or (ii), is
in the judgment of the Representatives so material and
adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the
Securities on the terms and in the manner contemplated in
the Prospectus;
(i) On or after the date hereof up to and including
the Time of Delivery (i) no downgrading shall have occurred
in the rating accorded the Company's debt securities or
preferred stock by any "nationally recognized statistical
rating organization", as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act,
and (ii) no such organization shall have publicly announced
that it has under surveillance or review, with possible
negative implications, its rating of any of the Company's
debt securities or preferred stock;
(j) On or after the date hereof there up to and
including the Time of Delivery shall not have occurred any
of the following: (i) a suspension or material limitation
in trading in securities generally on the New York Stock
Exchange; (ii) a suspension or material limitation in
trading in the Company's securities on the New York Stock
Exchange; (iii) a general moratorium on commercial banking
activities declared by either Federal or New York State
authorities; or (iv) the outbreak or escalation of
hostilities involving the United States or the declaration
by the United States of a national emergency or war, if the
effect of any such event specified in this Clause (iv) in
the reasonable judgment of the Representatives makes it
impracticable or inadvisable to proceed with the public
offering or the delivery of the Securities on the terms and
in the manner contemplated in the Prospectus;
(k) The Securities to be sold at the Time of Delivery
by MP&L Capital shall have been duly listed, subject to
notice of issuance, on the New York Stock Exchange; and
(l) MP&L Capital and the Company shall have furnished
or caused to be furnished to you at the Time of Delivery
certificates of officers of MP&L Capital and the Company
satisfactory to you as to the accuracy of the
representations and warranties of MP&L Capital and the
Company herein at and as of such Time of Delivery, as to the
performance by the Company of all of its obligations
hereunder to be performed at or prior to such Time of
Delivery, as to the matters set forth in subsections (a) and
(h) of this Section and as to such other matters as you may
reasonably request.
8. (a) MP&L Capital and the Company, jointly and
severally, will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the
Act, the Exchange Act or other federal or state statutory law or
regulation or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or
are based upon an untrue statement or alleged untrue statement of
a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or
supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse each Underwriter for
any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating or defending any
such action or claim as such expenses are incurred; provided,
however, that neither MP&L Capital nor the Company shall be
liable in any such case to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged
omission made in any Preliminary Prospectus, the Registration
Statement or the Prospectus or any such amendment or supplement
in reliance upon and in conformity with written information
furnished to MP&L Capital and the Company by any Underwriter
through Goldman, Sachs & Co. expressly for use therein; and
provided, further, that neither MP&L Capital nor the Company
shall be liable in any such case with respect to any Preliminary
Prospectus to the extent that any such loss, claim, damage or
liability of such Underwriter results from the fact that such
Underwriter sold Securities to a person as to whom it shall be
established that there was not sent or given, at or prior to the
written confirmation of such sale, a copy of the Prospectus
(excluding documents incorporated by reference) or of the
Prospectus as then amended or supplemented (excluding documents
incorporated by reference) in any case where delivery is required
by the Act if MP&L Capital or the Company has previously
furnished copies thereof in sufficient quantity to such
Underwriter and the loss, claim, damage or liability of such
Underwriter results from an untrue statement or omission of a
material fact contained in the Preliminary Prospectus which was
identified in writing at such time to such Underwriter and
corrected in the Prospectus as then amended or supplemented
(excluding documents incorporated by reference).
(b) Each Underwriter will indemnify and hold harmless
MP&L Capital and the Company against any losses, claims, damages
or liabilities to which MP&L Capital and the Company may become
subject, under the Act, the Exchange Act or other federal or
state statutory law or regulation or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or arise out
of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each
case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged
omission was made in any Preliminary Prospectus, the Registration
Statement or the Prospectus or any such amendment or supplement
in reliance upon and in conformity with written information
furnished to MP&L Capital and the Company by such Underwriter
through Goldman, Sachs & Co. expressly for use therein; and will
reimburse MP&L Capital and the Company for any legal or other
expenses reasonably incurred by the Company in connection with
investigating or defending any such action or claim as such
expenses are incurred.
(c) Promptly after receipt by an indemnified party
under subsection (a) or (b) above of notice of the commencement
of any action, such indemnified party shall, if a claim in
respect thereof is to be made against an indemnifying party under
such subsection, notify an indemnifying party in writing of the
commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which
it may have to any indemnified party otherwise than under such
subsection. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of
the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the
indemnifying party), and, after notice from the indemnifying
party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party shall not be liable to
such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case
subsequently incurred by such indemnified party, in connection
with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the written
consent of the indemnified party, effect the settlement or
compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect
of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential
party to such action or claim) unless such settlement, compromise
or judgment (i) includes an unconditional release of the
indemnified party from all liability arising out of such action
or claim and (ii) does not include a statement as to, or an
admission of, fault, culpability or a failure to act, by or on
behalf of any indemnified party. An indemnifying party shall not
be required to indemnify an indemnified party for any amounts
paid or payable by the indemnifying party in the settlement of
any action, proceeding or investigation without the written
consent of the indemnifying party, which consent shall not be
unreasonably withheld. An indemnifying party shall not be
liable, in connection with any proceedings or related proceedings
in the same jurisdiction, for the fees and expenses of more than
one separate counsel (in addition to any one local counsel in any
such jurisdiction) for all of the indemnified parties.
(d) If the indemnification provided for in this
Section 8 is unavailable to hold harmless an indemnified party
under subsection (a) or (b) above in respect of any losses, claims,
damages or liabilities (or actions in respect thereof) referred
to therein, then each indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of
such losses, claims, damages or liabilities (or actions in respect
thereof) in such proportion as is appropriate to reflect the
relative benefits received by MP&L Capital and the Company on the
one hand and the Underwriters on the other from the offering of
the Securities (taking into account the portion of the proceeds of
the offering (before deducting expenses) realized by each),
the relative fault of MP&L Capital and the Company on the one
hand and the Underwriters on the other in connection with the
statements or omissions which resulted in such losses, claims,
damages or liabilities (or actions in respect thereof), as well
as any other relevant equitable considerations. Relative fault
shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to
information supplied by MP&L Capital and the Company on the one
hand or the Underwriters on the other and the parties' relative
intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. MP&L Capital, the
Company and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this subsection (d) were
determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable
considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subsection (d) shall be deemed
to include any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by
which the total price at which the Securities underwritten by it
and distributed to the public were offered to the public exceeds
the amount of any damages which such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f)
of the Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations in this subsection (d) to contribute
are several in proportion to their respective underwriting
obligations and not joint.
(e) The obligations of MP&L Capital and the Company
under this Section 8 shall be in addition to any liability which
MP&L Capital and the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Act; and the
obligations of the Underwriters under this Section 8 shall be in
addition to any liability which the respective Underwriters may
otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of MP&L Capital and the
Company and to each person, if any, who controls the Company
within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation
to purchase the Securities which it has agreed to purchase
hereunder, you may in your discretion arrange for you or another
party or other parties to purchase such Securities on the terms
contained herein. If within thirty-six hours after such default
by any Underwriter you do not arrange for the purchase of such
Securities, then MP&L Capital and the Company shall be entitled
to a further period of thirty-six hours within which to procure
another party or other parties satisfactory to you to purchase
such Securities on such terms. In the event that, within the
respective prescribed periods, you notify MP&L Capital and the
Company that you have so arranged for the purchase of such
Securities, or MP&L Capital and the Company notify you that it
has so arranged for the purchase of such Securities, you or MP&L
Capital and the Company shall have the right to postpone the Time
of Delivery for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus, or in any other
documents or arrangements, and MP&L Capital and the Company agree
to file promptly any amendments to the Registration Statement or
the Prospectus which in your reasonable opinion may thereby be
made necessary. The term "Underwriter" as used in this Agreement
shall include any person substituted under this Section with like
effect as if such person had originally been a party to this
Agreement with respect to such Securities.
(b) If, after giving effect to any arrangements for
the purchase of the Securities of a defaulting Underwriter or
Underwriters by you and MP&L Capital and the Company as provided
in subsection (a) above, the aggregate number of such Securities
which remains unpurchased does not exceed one-eleventh of the
aggregate number of all the Securities, then MP&L Capital and the
Company shall have the right to require each non-defaulting
Underwriter to purchase the number of Securities which such
Underwriter agreed to purchase hereunder and, in addition, to
require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Securities which such Underwriter
agreed to purchase hereunder) of the Securities of such
defaulting Underwriter or Underwriters for which such
arrangements have not been made; but nothing herein shall relieve
a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for
the purchase of the Securities of a defaulting Underwriter or
Underwriters by you and MP&L Capital and the Company as provided
in subsection (a) above, the aggregate number of such Securities
which remains unpurchased exceeds one-eleventh of the aggregate
number of all the Securities, or if MP&L Capital and the Company
shall not exercise the right described in subsection (b) above to
require non-defaulting Underwriters to purchase Securities of a
defaulting Underwriter or Underwriters, then this Agreement shall
thereupon terminate, without liability on the part of any non-
defaulting Underwriter, MP&L Capital or the Company except for
the expenses to be borne by MP&L Capital and the Company and the
Underwriters as provided in Section 6 hereof and the indemnity
and contribution agreements in Section 8 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for
its default.
10. The respective indemnities, agreements, representations
and warranties of MP&L Capital and the Company and the several
Underwriters, as set forth in this Agreement or made by or on
behalf of them, respectively, pursuant to this Agreement, shall
remain in full force and effect, regardless of any investigation
(or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter,
or MP&L Capital, the Company, or any officer or director or
controlling person of MP&L Capital or the Company, and shall
survive delivery of and payment for the Securities.
11. If this Agreement shall be terminated pursuant to
Section 9 hereof, neither MP&L Capital nor the Company shall then
be under any liability to any Underwriter except as provided in
Sections 6 and 8 hereof; but, if because of any failure or
refusal on the part of the Company to comply with the terms of
this Agreement or because any of the conditions in Section 7 are
not satisfied, the Securities are not delivered by or on behalf
of MP&L Capital or the Company as provided herein, MP&L Capital
and the Company will reimburse the Underwriters through you for
all out-of-pocket expenses approved in writing by you, including
fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and
delivery of the Securities, but MP&L Capital and the Company
shall then be under no further liability to any Underwriter
except as provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of
each of the Underwriters, and the parties hereto shall be
entitled to act and rely upon any statement, request, notice or
agreement on behalf of any Underwriter made or given by you
jointly or by Goldman, Sachs & Co. on behalf of you as the
Representatives.
All statements, requests, notices and agreements hereunder
shall be in writing, and if to the Underwriters shall be
delivered or sent by mail, telex or facsimile transmission to you
as the Representatives in care of Goldman, Sachs & Co., 85 Broad
Street, New York, New York 10004, Attention: Registration
Department; and if to MP&L Capital or the Company shall be
delivered or sent by mail, telex or facsimile transmission to
MP&L Capital or the Company in care of the Company, 30 West
Superior Street, Duluth, Minnesota, 55802, Attention: Chief
Financial Officer; provided, however, that any notice to an
Underwriter pursuant to Section 8(c) hereof shall be delivered or
sent by mail, telex or facsimile transmission to such Underwriter
at its address set forth in its Underwriters' Questionnaire, or
telex constituting such Questionnaire, which address will be
supplied to MP&L Capital and the Company by you upon request.
Any such statements, requests, notices or agreements shall take
effect upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely
to the benefit of, the Underwriters, MP&L Capital, the Company
and, to the extent provided in Sections 8 and 10 hereof, the
officers, directors and administrative trustees of MP&L Capital,
the Company, and each person who controls MP&L Capital or the
Company, or any Underwriter, and their respective heirs,
executors, administrators, successors and assigns, and no other
person shall acquire or have any right under or by virtue of this
Agreement. No purchaser of any of the Securities from any
Underwriter shall be deemed a successor or assign by reason
merely of such purchase.
14. Time shall be of the essence of this Agreement. As
used herein, the term "business day" shall mean any day when the
Commission's office in Washington, D.C. is open for business.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of
the parties hereto in any number of counterparts, each of which
shall be deemed to be an original, but all such counterparts
shall together constitute one and the same instrument.
If the foregoing is in accordance with your understanding,
please sign and return to us one for MP&L Capital, the Company
and each of the Representatives plus one for each counsel
counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such
acceptance hereof shall constitute a binding agreement between
each of the Underwriters, MP&L Capital and the Company. It is
understood that your acceptance of this letter on behalf of each
of the Underwriters is pursuant to the authority set forth in a
form of Agreement among Underwriters, the form of which shall be
submitted to the Company for examination upon request, but
without warranty on your part as to the authority of the signers
thereof.
Very truly yours,
MP&L Capital I
By:____________________________
Name:
Title:
Minnesota Power & Light Company
By:____________________________
Name:
Title:
Accepted as of the date hereof:
Goldman, Sachs & Co.
PaineWebber Incorporated
By:_______________________________
Goldman, Sachs & Co.
On behalf of each of the Underwriters
SCHEDULE I
Total Number
of Securities to
Underwriter be Purchased
----------- ------------
Goldman, Sachs & Co.
PaineWebber Incorporated
[Names of other Underwriters]
-------------
Total =============
ANNEX I
Pursuant to Section 7(d) of the Underwriting Agreement,
the accountants shall furnish letters to the Underwriters to the
effect that:
(i) They are independent certified public accountants
with respect to the Company and its subsidiaries within the
meaning of the Act and the applicable published rules and
regulations thereunder;
(ii) In their opinion, the financial statements and
any supplementary financial information and schedules (and,
if applicable, financial forecasts and/or pro forma
financial information) examined by them and included or
incorporated by reference in the Registration Statement or
the Prospectus comply as to form in all material respects
with the applicable accounting requirements of the Act or
the Exchange Act, as applicable, and the related published
rules and regulations thereunder; and, if applicable, they
have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of
the consolidated interim financial statements, selected
financial data, pro forma financial information, financial
forecasts and/or condensed financial statements derived from
audited financial statements of the Company for the periods
specified in such letter, as indicated in their reports
thereon, copies of which have been separately furnished to
the representatives of the Underwriters (the
"Representatives");
(iii) They have made a review in accordance with
standards established by the American Institute of Certified
Public Accountants of the unaudited condensed consolidated
statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the
Prospectus and/or included in the Company's quarterly report
on Form 10-Q incorporated by reference into the Prospectus
as indicated in their reports thereon copies of which have
been separately furnished to the Representatives; and on the
basis of specified procedures including inquiries of
officials of the Company who have responsibility for
financial and accounting matters regarding whether the
unaudited condensed consolidated financial statements
referred to in paragraph (vi)(A)(i) below comply as to form
in the related in all material respects with the applicable
accounting requirements of the Act and the Exchange Act and
the related published rules and regulations, nothing came to
their attention that caused them to believe that the
unaudited condensed consolidated financial statements do not
comply as to form in all material respects with the
applicable accounting requirements of the Act and the
Exchange Act and the related published rules and
regulations;
(iv) The unaudited selected financial information with
respect to the consolidated results of operations and
financial position of the Company for the five most recent
fiscal years included in the Prospectus and included or
incorporated by reference in Item 6 of the Company's Annual
Report on Form 10-K for the most recent fiscal year agrees
with the corresponding amounts (after restatement where
applicable) in the audited consolidated financial statements
for such five fiscal years which were included or
incorporated by reference in the Company's Annual Reports on
Form 10-K for such fiscal years;
(v) They have compared the information in the
Prospectus under selected captions with the disclosure
requirements of Regulation S-K and on the basis of limited
procedures specified in such letter nothing came to their
attention as a result of the foregoing procedures that
caused them to believe that this information does not
conform in all material respects with the disclosure
requirements of Items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not
constituting an examination in accordance with generally
accepted auditing standards, consisting of a reading of the
unaudited financial statements and other information
referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries,
inspection of the minute books of the Company and its
subsidiaries since the date of the latest audited financial
statements included or incorporated by reference in the
Prospectus, inquiries of officials of the Company and its
subsidiaries responsible for financial and accounting
matters and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention
that caused them to believe that:
(A) (i) the unaudited condensed consolidated
statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the
Prospectus and/or included or incorporated by reference
in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus do not
comply as to form in all material respects with the
applicable accounting requirements of the Exchange Act
and the related published rules and regulations, or
(ii) any material modifications should be made to the
unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements
of cash flows included in the Prospectus or included in
the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus, for them
to be in conformity with generally accepted accounting
principles;
(B) any other unaudited income statement data and
balance sheet items included in the Prospectus do not
agree with the corresponding items in the unaudited
consolidated financial statements from which such data
and items were derived, and any such unaudited data and
items were not determined on a basis substantially
consistent with the basis for the corresponding amounts
in the audited consolidated financial statements
included or incorporated by reference in the Company's
Annual Report on Form 10-K for the most recent fiscal
year;
(C) the unaudited financial statements which were
not included in the Prospectus but from which were
derived the unaudited condensed financial statements
referred to in Clause (A) and any unaudited income
statement data and balance sheet items included in the
Prospectus and referred to in Clause (B) were not
determined on a basis substantially consistent with the
basis for the audited financial statements included or
incorporated by reference in the Company's Annual
Report on Form 10-K for the most recent fiscal year;
(D) any unaudited pro forma consolidated
condensed financial statements included or incorporated
by reference in the Prospectus do not comply as to form
in all material respects with the applicable accounting
requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments
have not been properly applied to the historical
amounts in the compilation of those statements;
(E) as of a specified date not more than five
days prior to the date of such letter, there have been
any changes in the consolidated capital stock (other
than issuances of capital stock upon exercise of
options and stock appreciation rights, upon earn-outs
of performance shares and upon conversions of
convertible securities, in each case which were
outstanding on the date of the latest balance sheet
included or incorporated by reference in the
Prospectus) or any increase in the consolidated
long-term debt of the Company and its subsidiaries, or
any decreases in consolidated net current assets or
stockholders' equity or other items specified by the
Representatives, or any increases in any items
specified by the Representatives, in each case as
compared with amounts shown in the latest balance sheet
included or incorporated by reference in the
Prospectus, except in each case for changes, increases
or decreases which the Prospectus discloses have
occurred or may occur or which are described in such
letter; and
(F) for the period from the date of the latest
financial statements included or incorporated by
reference in the Prospectus to the specified date
referred to in Clause (E) there were any decreases in
consolidated net revenues or operating profit or the
total or per share amounts of consolidated net income
or other items specified by the Representatives, or any
increases in any items specified by the
Representatives, in each case as compared with the
comparable period of the preceding year and with any
other period of corresponding length specified by the
Representatives, except in each case for increases or
decreases which the Prospectus discloses have occurred
or may occur or which are described in such letter; and
(vii) In addition to the examination referred to in
their report(s) included or incorporated by reference in the
Prospectus and the limited procedures, inspection of minute
books, inquiries and other procedures referred to in
paragraphs (iii) and (vi) above, they have carried out
certain specified procedures, not constituting an
examination in accordance with generally accepted auditing
standards, with respect to certain amounts, percentages and
financial information specified by the Representatives which
are derived from the general accounting records of the
Company and its subsidiaries, which appear in the Prospectus
(excluding documents incorporated by reference) or in Part
II of, or in exhibits and schedules to, the Registration
Statement specified by the Representatives or in documents
incorporated by reference in the Prospectus specified by the
Representatives, and have compared certain of such amounts,
percentages and financial information with the accounting
records of the Company and its subsidiaries and have found
them to be in agreement.
Exhibit 4(b)
=================================================================
AMENDED AND RESTATED
TRUST AGREEMENT
between
MINNESOTA POWER & LIGHT COMPANY, as Depositor
and
THE BANK OF NEW YORK,
THE BANK OF NEW YORK (DELAWARE),
PHILIP R. HALVERSON,
[ ],
and
[ ], as Trustees
Dated as of , 1996
MP&L CAPITAL I
=================================================================
MP&L Capital I
Certain Sections of this Trust Agreement relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
Trust Indenture Trust Agreement
Act Section Section
--------------- ---------------
Section 310(a)(1) . . . . . . . . . . . . 8.07
(a)(2) . . . . . . . . . . . . 8.07
(a)(3) . . . . . . . . . . . . 8.09
(a)(4) . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . 8.08
Section 311(a) . . . . . . . . . . . . 8.13
(b) . . . . . . . . . . . . 8.13
Section 312(a) . . . . . . . . . . . . 5.07
(b) . . . . . . . . . . . . 5.07
(c) . . . . . . . . . . . . 5.07
Section 313(a) . . . . . . . . . . . . 8.14(a)
(a)(4) . . . . . . . . . . . . 8.14(b)
(b) . . . . . . . . . . . . 8.14(b)
(c) . . . . . . . . . . . . 8.14(a)
(d) . . . . . . . . . . . . 8.14(a), 8.14(b)
Section 314(a) . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . . . Not Applicable
(c)(2) . . . . . . . . . . . . Not Applicable
(c)(3) . . . . . . . . . . . . Not Applicable
(d) . . . . . . . . . . . . Not Applicable
(e) . . . . . . . . . . . . Not Applicable
Section 315(a) . . . . . . . . . . . . 8.01
(b) . . . . . . . . . . . . 8.02, 8.14(b)
(c) . . . . . . . . . . . . 8.01(a)
(d) . . . . . . . . . . . . 8.01, 8.03
(e) . . . . . . . . . . . . Not Applicable
Section 316(a) . . . . . . . . . . . . Not Applicable
(a)(1)(A). . . . . . . . . . . . Not Applicable
(a)(1)(B). . . . . . . . . . . . Not Applicable
(a)(2) . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . Not Applicable
(c) . . . . . . . . . . . . Not Applicable
Section 317(a)(1) . . . . . . . . . . . . Not Applicable
(a)(2) . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . 5.09
Section 318(a) . . . . . . . . . . . . 10.10
----------
Note: This reconciliation and tie shall not, for any purpose,
be deemed to be a part of the Trust Agreement.
TABLE OF CONTENTS
ARTICLE I.
Defined Terms
Section 1.01. Definitions . . . . . . . . . . . . . . 2
ARTICLE II.
Establishment of the Trust
Section 2.01. Name. . . . . . . . . . . . . . . . . . 11
Section 2.02. Office of the Delaware Trustee;
Principal Place of Business. . . . . . 11
Section 2.03. Initial Contribution of Trust
Property; Organizational Expenses. . . 11
Section 2.04. Issuance of the Preferred Securities. . 11
Section 2.05. Subscription and Purchase of
Debentures; Issuance of the Common
Securities . . . . . . . . . . . . . . 11
Section 2.06. Declaration of Trust; Appointment of
Additional Administrative Trustees . . 12
Section 2.07. Authorization to Enter into Certain
Transactions . . . . . . . . . . . . . 12
Section 2.08. Assets of Trust . . . . . . . . . . . . 16
Section 2.09. Title to Trust Property . . . . . . . . 16
ARTICLE III.
Payment Account
Section 3.01. Payment Account . . . . . . . . . . . . 16
ARTICLE IV.
Distributions; Redemption
Section 4.01. Distributions . . . . . . . . . . . . . 17
Section 4.02. Redemption. . . . . . . . . . . . . . . 18
Section 4.03. Subordination of Common Securities. . . 20
Section 4.04. Payment Procedures. . . . . . . . . . . 20
Section 4.05. Tax Returns and Reports . . . . . . . . 20
ARTICLE V.
Trust Securities Certificates
Section 5.01. Initial Ownership . . . . . . . . . . . 21
Section 5.02. The Trust Securities Certificates . . . 21
Section 5.03. Execution and Delivery of Trust
Securities Certificates. . . . . . . . 21
Section 5.04. Registration of Transfer and Exchange
of Preferred Securities Certificates . 22
Section 5.05. Mutilated, Destroyed, Lost or Stolen
Trust Securities Certificates. . . . . 23
Section 5.06. Persons Deemed Securityholders. . . . . 23
Section 5.07. Access to List of Securityholders'
Names and Addresses. . . . . . . . . . 23
Section 5.08. Maintenance of Office or Agency . . . . 24
Section 5.09. Appointment of Paying Agent . . . . . . 24
Section 5.10. Ownership of Common Securities by
Depositor. . . . . . . . . . . . . . . 25
Section 5.11. Definitive Preferred Securities
Certificates . . . . . . . . . . . . . 25
Section 5.12. Book-Entry System . . . . . . . . . . . 25
Section 5.13. Rights of Securityholders . . . . . . . 26
ARTICLE VI.
Acts of Securityholders; Meetings; Voting
Section 6.01. Limitations on Voting Rights. . . . . . 26
Section 6.02. Notice of Meetings. . . . . . . . . . . 27
Section 6.03. Meetings of Holders of Preferred
Securities . . . . . . . . . . . . . . 27
Section 6.04. Voting Rights . . . . . . . . . . . . . 28
Section 6.05. Proxies, etc. . . . . . . . . . . . . . 28
Section 6.06. Securityholder Action by Written
Consent. . . . . . . . . . . . . . . . 28
Section 6.07. Record Date for Voting and Other
Purposes . . . . . . . . . . . . . . . 28
Section 6.08. Acts of Securityholders . . . . . . . . 29
Section 6.09. Inspection of Records . . . . . . . . . 30
ARTICLE VII.
Representations and Warranties of the Property
Trustee and the Delaware Trustee
Section 7.01. Property Trustee. . . . . . . . . . . . 30
Section 7.02. Delaware Trustee. . . . . . . . . . . . 31
ARTICLE VIII.
The Trustees
Section 8.01. Certain Duties and Responsibilities . . 31
Section 8.02. Notice of Defaults. . . . . . . . . . . 33
Section 8.03. Certain Rights of Property Trustee. . . 33
Section 8.04. Not Responsible for Recitals or
Issuance of Securities . . . . . . . . 36
Section 8.05. May Hold Securities . . . . . . . . . . 36
Section 8.06. Compensation; Fees; Indemnity . . . . . 36
Section 8.07. Certain Trustees Required; Eligibility. 37
Section 8.09. Co-Trustees and Separate Trustee. . . . 38
Section 8.10. Resignation and Removal; Appointment
of Successor . . . . . . . . . . . . . 39
Section 8.11. Acceptance of Appointment by Successor. 40
Section 8.12. Merger, Conversion, Consolidation or
Succession to Business . . . . . . . . 41
Section 8.13. Preferential Collection of Claims
Against Depositor or Trust . . . . . . 41
Section 8.14. Reports by Property Trustee . . . . . . 41
Section 8.15. Reports to the Property Trustee . . . . 42
Section 8.16. Evidence of Compliance With Conditions
Precedent. . . . . . . . . . . . . . . 42
Section 8.17. Number of Trustees. . . . . . . . . . . 42
Section 8.18. Delegation of Power . . . . . . . . . . 42
Section 8.19. Fiduciary Duty. . . . . . . . . . . . . 43
ARTICLE IX.
Termination and Liquidation
Section 9.01. Termination Upon Expiration Date. . . . 44
Section 9.02. Early Termination . . . . . . . . . . . 44
Section 9.03. Termination . . . . . . . . . . . . . . 44
Section 9.04. Liquidation . . . . . . . . . . . . . . 45
ARTICLE X.
Miscellaneous Provisions
Section 10.01. Guarantee by the Depositor and
Assumption of Obligations . . . . . . 47
Section 10.02. Limitation of Rights of
Securityholders . . . . . . . . . . . 47
Section 10.03. Amendment. . . . . . . . . . . . . . . 47
Section 10.04. Separability . . . . . . . . . . . . . 48
Section 10.05. Governing Law. . . . . . . . . . . . . 48
Section 10.06. Successors . . . . . . . . . . . . . . 49
Section 10.07. Headings . . . . . . . . . . . . . . . 49
Section 10.08. Notice and Demand. . . . . . . . . . . 49
Section 10.09. Agreement Not to Petition. . . . . . . 49
Section 10.10. Conflict with Trust Indenture Act. . . 50
AMENDED AND RESTATED TRUST AGREEMENT, dated as of
February , 1996, between (i) Minnesota Power & Light Company,
a Minnesota corporation (the "Depositor"), (ii) The Bank of New
York, a banking corporation duly organized and existing under the
laws of New York, as trustee (the "Property Trustee" and, in its
separate capacity and not in its capacity as Property Trustee,
the "Bank"), (iii) The Bank of New York (Delaware), a banking
corporation duly organized under the laws of Delaware, as trustee
(the "Delaware Trustee") and (iv) Philip R. Halverson,
and , each an individual, as trustee, and
each of whose address is c/o Minnesota Power & Light Company, 30
West Superior Street, Duluth, Minnesota 55802 (each, an
"Administrative Trustee" and collectively the "Administrative
Trustees") (the Property Trustee, the Delaware Trustee and the
Administrative Trustees referred to collectively as the
"Trustees") and (v) the several Holders, as hereinafter defined.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Depositor, the Property Trustee, the
Delaware Trustee and Philip R. Halverson, as the Administrative
Trustee, have heretofore duly declared and established a business
trust pursuant to the Delaware Business Trust Act by the entering
into of that certain Trust Agreement, dated as of February 15,
1996 (the "Original Trust Agreement"), and by the execution by
the Property Trustee, the Delaware Trustee and Philip R.
Halverson, as Administrative Trustee and filing with the
Secretary of State of the State of Delaware of the Certificate of
Trust, dated February 15, 1996, a copy of which is attached as
Exhibit A; and
WHEREAS, the Depositor, the Property Trustee, Delaware
Trustee and Philip R. Halverson, as Administrative Trustee,
desire to amend and restate the Original Trust Agreement in its
entirety as set forth herein to provide for, among other things,
(i) the acquisition by the Trust from the Depositor of all of the
right, title and interest in the Debentures, (ii) the issuance of
the Common Securities by the Trust to the Depositor, (iii) the
issuance of the Preferred Securities by the Trust and (iv) the
appointment of additional Administrative Trustees of the Trust;
NOW THEREFORE, in consideration of the agreements and
obligations set forth herein and for other good and valuable
consideration, the sufficiency of which is hereby acknowledged,
each party, for the benefit of the other party and for the
benefit of the Securityholders, hereby amends and restates the
Original Trust Agreement in its entirety and agrees as follows:
ARTICLE I.
DEFINED TERMS
SECTION 1.01. DEFINITIONS. For all purposes of this
Trust Agreement, 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 other terms used herein that are defined
in the Trust Indenture Act, either directly or by
reference therein, have the meanings assigned to them
therein;
(c) unless the context otherwise requires, any
reference to an "Article" or a "Section" refers to an
Article or a Section, as the case may be, of this Trust
Agreement; and
(d) the words "herein", "hereof" and "hereunder"
and other words of similar import refer to this Trust
Agreement as a whole and not to any particular Article,
Section or other subdivision.
"Act" has the meaning specified in Section 6.08.
"Additional Amount" means, with respect to Trust
Securities of a given Liquidation Amount and/or a given period,
the amount of Additional Interest (as defined in the Subordinated
Indenture) paid by the Depositor on a Like Amount of Debentures
for such period.
"Administrative Trustee" means each of the individuals
identified as an "Administrative Trustee" in the preamble to this
Trust Agreement solely in their capacities as Administrative
Trustees of the Trust created hereunder and not in their
individual capacities, or such trustee's successor in interest in
such capacity, or any successor trustee appointed as herein
provided.
"Affiliate" of any specified Person means any other
Person directly or indirectly controlling or controlled by or
under direct or indirect common control with such specified
Person. For the purposes of this definition, "control" when used
with respect to any specified Person means the power to direct
the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities,
by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Bank" has the meaning specified in the preamble to
this Trust Agreement.
"Bankruptcy Event" means, with respect to any Person:
(i) the entry of a decree or order by a court
having jurisdiction in the premises judging such Person
a bankrupt or insolvent, or approving as properly filed
a petition seeking reorganization, arrangement,
adjudication or composition of or in respect of such
Person under Federal bankruptcy law or any other
applicable Federal or State law, or appointing a
receiver, liquidator, assignee, trustee sequestrator or
other similar official of such Person or of any
substantial part of its property, or ordering the
winding up or liquidation of its affairs, and the
continuance of any such decree or order unstayed and in
effect for a period of 60 consecutive days; or
(ii) the institution by such Person of
proceedings to be adjudicated a bankrupt or insolvent,
or of the consent by it to the institution of
bankruptcy or insolvency proceedings against it, or the
filing by it of a petition or answer or consent seeking
reorganization or relief under Federal bankruptcy law
or any other applicable Federal or State law, or the
consent by it to the filing of such petition or to the
appointment of a receiver, liquidator, assignee,
trustee, sequestrator or similar official of such
Person 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.
"Bankruptcy Laws" has the meaning specified in Section
10.09.
"Board Resolution" means a copy of a resolution
certified by the Secretary or an Assistant Secretary of the
Depositor to have been duly adopted by the Depositor's Board of
Directors or a duly authorized committee thereof and to be in
full force and effect on the date of such certification, and
delivered to the appropriate Trustee.
"Business Day" means a day other than (x) a Saturday or
a Sunday, (y) a day on which banks in New York, New York are
authorized or obligated by law or executive order to remain
closed or (z) a day on which the Property Trustee's Corporate
Trust Office or the Debenture Trustee's principal corporate trust
office is closed for business.
"Certificate of Trust" has the meaning specified in
Section 2.07(d).
"Clearing Agency" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act.
"Closing Date" means the date of delivery of this Trust
Agreement.
"Code" means the Internal Revenue Code of 1986, as
amended.
"Commission" means the Securities and Exchange
Commission, as from time to time constituted, created under the
Exchange Act, or, if at any time after the execution of this
instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Common Security" means an undivided beneficial
interest in the assets of the Trust having a Liquidation Amount
of $25 and having the rights provided therefor in this Trust
Agreement, including the right to receive Distributions and a
Liquidation Distribution as provided herein.
"Common Securities Certificate" means a certificate
evidencing ownership of Common Securities, substantially in the
form attached as Exhibit B.
"Corporate Trust Office" means the principal corporate
trust office of the Property Trustee located in New York, New
York.
"Covered Person" means: (a) any officer, director,
shareholder, partner, member, representative, employee or agent
of the Trust or the Trust's Affiliates; and (b) any Holder of
Trust Securities.
"Debenture Event of Default" means an "Event of
Default" as defined in the Subordinated Indenture.
"Debenture Issuer" means Minnesota Power & Light
Company, a Minnesota corporation, in its capacity as issuer of
the Debentures.
"Debenture Redemption Date" means "Redemption Date" as
defined in the Subordinated Indenture with respect to the
Debentures.
"Debenture Trustee" means The Bank of New York, as
trustee under the Subordinated Indenture.
"Debentures" means the $ aggregate
principal amount of the Depositor's % Junior Subordinated
Debentures, Series , due , issued pursuant
to the Subordinated Indenture.
"Definitive Preferred Securities Certificates" means
Preferred Securities Certificates issued in certificated, fully
registered form as provided in Section 5.11.
"Delaware Business Trust Act" means Chapter 38 of Title
12 of the Delaware Code, 12 Del. Code Section 3801 et seq., as it
may be amended from time to time.
"Delaware Trustee" means the banking corporation
identified as the "Delaware Trustee" in the preamble to this
Trust Agreement solely in its capacity as Delaware Trustee of the
Trust formed hereunder and not in its individual capacity, or its
successor in interest in such capacity, or any successor trustee
appointed as herein provided.
"Depositor" has the meaning specified in the preamble
to this Trust Agreement.
"Distribution Date" has the meaning specified in
Section 4.01(a).
"Distributions" means amounts payable in respect of the
Trust Securities as provided in Section 4.01.
"Early Termination Event" has the meaning specified in
Section 9.02.
"Event of Default" means any one of the following
events (whatever the reason for such Event of Default and whether
it shall be voluntary or involuntary or be effected by operation
of law or pursuant to any judgment, decree or order of any court
or any order, rule or regulation of any administrative or
governmental body):
(i) the occurrence of a Debenture Event of
Default; or
(ii) default by the Trust in the payment of any
Distribution when it becomes due and payable, and
continuation of such default for a period of 30 days;
or
(iii) default by the Trust in the payment of any
Redemption Price, plus accumulated and unpaid
distributions of any Trust Security when it becomes due
and payable; or
(iv) default in the performance, or breach, in
any material respect of any covenant or warranty of the
Trustees in this Trust Agreement (other than a covenant
or warranty a default in whose performance or breach is
specifically dealt with in clause (ii) or (iii), above)
and continuation of such default or breach for a period
of 60 days after there has been given, by registered or
certified mail, to the Trust by the Holders of at least
10% in Liquidation Amount of the Outstanding Preferred
Securities a written notice specifying such default or
breach and requiring it to be remedied and stating that
such notice is a "Notice of Default" hereunder; or
(v) the occurrence of a Bankruptcy Event with
respect to the Trust.
"Exchange Act" has the meaning specified in Section
2.07(c).
"Expense Agreement" means the Agreement as to Expenses
and Liabilities between the Depositor and the Trust,
substantially in the form attached as Exhibit C, as amended from
time to time.
"Expiration Date" shall have the meaning specified in
Section 9.01.
"Guarantee" means the Guarantee Agreement executed and
delivered by the Depositor and The Bank of New York, a New York
banking corporation, as trustee, contemporaneously with the
execution and delivery of this Trust Agreement, for the benefit
of the Holders of the Preferred Securities, as amended from time
to time.
"Indemnified Person" means any Trustee, any Affiliate
of any Trustee, or any officer, director, shareholder, member,
partner, employee, representative or agent of any Trustee, or any
employee or agent of the Trust or its Affiliates.
"Investment Company Event" means the occurrence of a
change in law or regulation or a change in interpretation or
application of law or regulation by any legislative body, court,
governmental agency or regulatory authority to the effect that
the Trust is or will be considered an "investment company" that
is required to be registered under the Investment Company Act of
1940, as amended, which change in law becomes effective on or
after the date of original issuance of the Preferred Securities.
"Lien" means any lien, pledge, charge, encumbrance,
mortgage, deed of trust, adverse ownership interest,
hypothecation, assignment, security interest or preference,
priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
"Like Amount" means (i) Trust Securities having a
Liquidation Amount equal to the principal amount of Debentures to
be contemporaneously redeemed in accordance with the Subordinated
Indenture and the proceeds of which will be used to pay the
Redemption Price of such Trust Securities plus accumulated and
unpaid Distributions to the date of such payment and (ii)
Debentures having a principal amount equal to the Liquidation
Amount of the Trust Securities of the Holder to whom such
Debentures are distributed.
"Liquidation Amount" means the stated amount of $25 per
Trust Security.
"Liquidation Date" means the date on which Debentures
are to be distributed to Holders of Trust Securities in
connection with a termination and liquidation of the Trust
pursuant to Section 9.04(a).
"Liquidation Distribution" has the meaning specified in
Section 9.04(e).
"Offer" has the meaning specified in Section 2.07(c).
"Officers' Certificate" means a certificate signed by
the Chairman of the Board, a Vice Chairman of the Board, the
President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary, of the
Depositor, and delivered to the appropriate Trustee. One of the
officers signing an Officers' Certificate given pursuant to
Section 8.16 shall be the principal executive, financial or
accounting officer of the Depositor. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant
provided for in this Trust Agreement shall include:
(a) a statement that each officer signing the
Officers' Certificate has read the covenant or condition and
the definitions relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in
rendering the Officers' Certificate;
(c) a statement that each such officer has made such
examination or investigation as, in such officer's opinion,
is necessary to enable such officer 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 officer, such condition or covenant has been complied
with.
"Opinion of Counsel" means a written opinion of
counsel, who may be counsel for the Trust, the Property Trustee,
the Delaware Trustee or the Depositor, but not an employee of the
Trust, the Property Trustee, the Delaware Trustee or the
Depositor, and who shall be reasonably acceptable to the Property
Trustee.
"Original Trust Agreement" has the meaning specified in
the recitals to this Trust Agreement.
"Outstanding," when used with respect to Preferred
Securities, means, as of the date of determination, all Preferred
Securities theretofore delivered under this Trust Agreement,
except:
(i) Preferred Securities theretofore canceled by
the Administrative Trustees or delivered to the
Administrative Trustees for cancellation;
(ii) Preferred Securities for whose payment or
redemption money in the necessary amount has been
theretofore deposited with the Property Trustee or any
Paying Agent for the Holders of such Preferred
Securities; provided that, if such Preferred Securities
are to be redeemed, notice of such redemption has been
duly given pursuant to this Trust Agreement; and
(iii) Preferred Securities in exchange for or in
lieu of which other Preferred Securities have been
delivered pursuant to this Trust Agreement, including
pursuant to Sections 5.04, 5.05 or 5.11;
provided, however, that in determining whether the Holders of the
requisite Liquidation Amount of the Outstanding Preferred
Securities have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Preferred
Securities owned by the Depositor, any Trustee or any Affiliate
of the Depositor or any Trustee shall be disregarded and deemed
not to be Outstanding, except that (a) in determining whether any
Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only
Preferred Securities which such Trustee knows to be so owned
shall be so disregarded and (b) the foregoing shall not apply at
any time when all of the outstanding Preferred Securities are
owned by the Depositor, one or more of the Trustees and/or any
such Affiliate. Preferred Securities so owned which have been
pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Administrative
Trustee the pledgee's right so to act with respect to such
Preferred Securities and that the pledgee is not the Depositor or
any Affiliate of the Depositor.
"Owner" means each Person who is the beneficial owner
of a Preferred Securities Certificate as reflected in the records
of the Securities Depository or, if a Securities Depository
Participant is not the beneficial owner, then as reflected in the
records of a Person maintaining an account with such Securities
Depository (directly or indirectly), in accordance with the rules
of such Securities Depository.
"Paying Agent" means any paying agent or co-paying
agent appointed pursuant to Section 5.09 and shall initially be
The Bank of New York.
"Payment Account" means a segregated non-interest-
bearing corporate trust account maintained by the Property
Trustee at The Bank of New York, or such other banking
institution as the Depositor shall select in its trust department
for the benefit of the Securityholders in which all amounts paid
in respect of the Debentures will be held and from which the
Paying Agent, pursuant to Section 5.09, shall make payments to
the Securityholders in accordance with Sections 4.01 and 4.02.
"Person" means any individual, corporation,
partnership, joint venture, trust, limited liability company or
corporation, unincorporated organization or government or any
agency or political subdivision thereof.
"Preferred Security" means a quarterly income preferred
security representing an undivided beneficial interest in the
assets of the Trust having a Liquidation Amount of $25 and having
rights provided therefor in this Trust Agreement, including the
right to receive Distributions and a Liquidation Distribution as
provided herein.
"Preferred Securities Certificate" means a certificate
evidencing ownership of Preferred Securities, substantially in
the form attached as Exhibit D.
"Property Trustee" means the commercial bank or trust
company identified as the "Property Trustee" in the preamble to
this Trust Agreement solely in its capacity as Property Trustee
of the Trust formed and continued hereunder and not in its
individual capacity, or its successor in interest in such
capacity, or any successor trustee appointed as herein provided.
"Redemption Date" means, with respect to any Trust
Security to be redeemed, the date fixed for such redemption by or
pursuant to this Trust Agreement; provided that each Debenture
Redemption Date shall be a Redemption Date for a Like Amount of
Trust Securities.
"Redemption Price" means, with respect to any date
fixed for redemption of any Trust Security, the Liquidation
Amount of such Trust Security.
"Redemption Tax Opinion" has the meaning specified in
Section 9.04(d).
"Registrar" shall mean the registrar for the Preferred
Securities appointed by the Trust and shall be initially The Bank
of New York.
"Relevant Trustee" shall have the meaning specified in
Section 8.10.
"Responsible Officer," when used with respect to the
Property Trustee means an officer of the Property Trustee
assigned by the Property Trustee to administer its corporate
trust matter.
"Securities Depository" shall be The Depository Trust
Company.
"Securities Depository Participant" means an
institution which deposits securities with a Securities
Depository for holding thereby.
"Securities Register" shall mean the Securities
Register described in Section 5.04.
"Securityholder" or "Holder" means a Person in whose
name a Trust Security or Securities is registered in the
Securities Register; any such Person shall be deemed to be a
beneficial owner within the meaning of the Delaware Business
Trust Act.
"Special Event" means either a Tax Event or an
Investment Company Event.
"Subordinated Indenture" means the Indenture, dated as
of , 1996, between the Depositor and the Debenture
Trustee, as trustee, as amended or supplemented from time to
time.
"Tax Event" means the receipt by the Trust of an
opinion of counsel (which may be counsel to the Depositor or an
affiliate but not an employee thereof and which must be
acceptable to the Property Trustee) experienced in such matters
to the effect that, as a result of any amendment to, or change
(including any announced prospective change) in, the laws (or any
regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein affecting
taxation, or as a result of any official administrative or
judicial decision interpreting or applying such laws or
regulations, which amendment or change is effective or such
pronouncement or decision is announced on or after the date of
original issuance of the Preferred Securities under this Trust
Agreement, there is more than an insubstantial risk that (i) the
Trust is, or will be within 90 days of the date thereof, subject
to United States federal income tax with respect to income
received or accrued on the Debentures, (ii) interest payable by
the Depositor on the Debentures, is not, or within 90 days of the
date thereof, will not be, deductible, in whole or in part, for
United States federal income tax purposes, or (iii) the Trust is,
or will be within 90 days of the date thereof, subject to more
than a de minimis amount of other taxes, duties or other
governmental charges.
"Transfer Agent" shall mean one or more transfer agents
for the Preferred Securities appointed by the Trust and shall be
initially The Bank of New York.
"Trust" means the Delaware business trust created by
the Original Trust Agreement and continued hereby and identified
on the cover page to this Trust Agreement.
"Trust Agreement" means this Amended and Restated Trust
Agreement, as the same may be modified, amended or supplemented
in accordance with the applicable provisions hereof, including
all exhibits hereto, including, for all purposes of this Amended
and Restated Trust Agreement and any such modification, amendment
or supplement, the provisions of the Trust Indenture Act that are
deemed to be a part of and govern this Amended and Restated Trust
Agreement and any such modification, amendment or supplement,
respectively.
"Trust Indenture Act" means the Trust Indenture Act of
1939 as in force at the date as of which this instrument was
executed; provided, however, that in the event the Trust
Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such
amendment, the Trust Indenture Act of 1939 as so amended.
"Trust Property" means (i) the Debentures, (ii) any
cash on deposit in, or owing to, the Payment Account and (iii)
all proceeds and rights in respect of the foregoing and any other
property and assets for the time being held by the Property
Trustee pursuant to the trusts of this Trust Agreement.
"Trust Security" means any one of the Common Securities
or the Preferred Securities.
"Trust Securities Certificate" means any one of the
Common Securities Certificates or the Preferred Securities
Certificates.
"Underwriting Agreement" means the Underwriting
Agreement, dated as of , 1996, among the Trust, the
Depositor and the underwriters named therein.
ARTICLE II.
ESTABLISHMENT OF THE TRUST
SECTION 2.01. NAME. The Trust created hereby shall be
known as "MP&L Capital I", in which name the Trustees may conduct
the business of the Trust, make and execute contracts and other
instruments on behalf of the Trust and sue and be sued.
SECTION 2.02. OFFICE OF THE DELAWARE TRUSTEE;
PRINCIPAL PLACE OF BUSINESS. The office of the Delaware Trustee
in the State of Delaware is White Clay Center, Route 273, Newark,
Delaware 19711, or at such other address in Delaware as the
Delaware Trustee may designate by written notice to the
Securityholders and the Depositor. The principal place of
business of the Trust is c/o Minnesota Power & Light Company, 30
West Superior Street, Duluth, Minnesota 55802.
SECTION 2.03. INITIAL CONTRIBUTION OF TRUST PROPERTY;
ORGANIZATIONAL EXPENSES. The Property Trustee acknowledges
receipt in trust from the Depositor in connection with the
Original Trust Agreement of the sum of $10, which constituted the
initial Trust Property. The Depositor shall pay organizational
expenses of the Trust as they arise or shall, upon request of any
Trustee, promptly reimburse such Trustee for any such expenses
paid by such Trustee. The Depositor shall make no claim upon the
Trust Property for the payment of such expenses.
SECTION 2.04. ISSUANCE OF THE PREFERRED SECURITIES.
On , 1996 the Depositor and an Administrative
Trustee, on behalf of the Trust, both executed and delivered the
Underwriting Agreement. Contemporaneously with the execution and
delivery of this Trust Agreement, one of the Administrative
Trustees, on behalf of the Trust in accordance with Section 5.02,
executed manually and delivered a Preferred Securities
Certificate, registered in the name of the nominee of The
Depositary Trust Company, having an aggregate Liquidation Amount
of $ .
SECTION 2.05. SUBSCRIPTION AND PURCHASE OF DEBENTURES;
ISSUANCE OF THE COMMON SECURITIES. Contemporaneously with the
execution and delivery of this Trust Agreement, the
Administrative Trustees, on behalf of the Trust, shall subscribe
to and purchase from the Depositor Debentures, registered in the
name of the Property Trustee and having an aggregate principal
amount equal to $ , and, in satisfaction of the
purchase price for such Debentures, (x) one of the Administrative
Trustees, on behalf of the Trust, shall execute and deliver to
the Depositor Common Securities Certificates, registered in the
name of the Depositor, in an aggregate amount of Common
Securities having an aggregate Liquidation Amount of $
, and (y) the Property Trustee, on behalf of the Trust, shall
deliver to the Depositor the sum of $ representing the
proceeds from the sale of the Preferred Securities pursuant to
the Underwriting Agreement.
SECTION 2.06. DECLARATION OF TRUST; APPOINTMENT OF
ADDITIONAL ADMINISTRATIVE TRUSTEES. (a) The exclusive purposes
and functions of the Trust are (i) to issue Trust Securities and
invest the proceeds thereof in Debentures, and (ii) to engage in
those activities necessary, convenient or incidental thereto.
The Depositor hereby appoints the Trustees as trustees of the
Trust, to have all the rights, powers and duties to the extent
set forth herein. The Property Trustee hereby declares that it
will hold the Trust Property in trust upon and subject to the
conditions set forth herein for the benefit of the
Securityholders. The Trustees shall have all rights, powers and
duties set forth herein and in accordance with applicable law
with respect to accomplishing the purposes of the Trust.
Anything in this Trust Agreement to the contrary notwithstanding
the Delaware Trustee shall not be entitled to exercise any
powers, nor shall the Delaware Trustee have any of the duties and
responsibilities, of the Property Trustee or the Administrative
Trustees set forth herein. The Delaware Trustee shall be one of
the Trustees of the Trust for the sole and limited purpose of
fulfilling the requirements of Section 3807 of the Delaware
Business Trust Act.
SECTION 2.07. AUTHORIZATION TO ENTER INTO CERTAIN
TRANSACTIONS. (a) The Trustees shall conduct the affairs of the
Trust in accordance with the terms of this Trust Agreement.
Subject to the limitations set forth in paragraph (b) of this
Section and Article VIII and in accordance with the following
provisions (A) and (B), the Trustees shall have the authority to
enter into all transactions and agreements determined by the
Trustees to be appropriate in exercising the authority, express
or implied, otherwise granted to the Trustees under this Trust
Agreement, and to perform all acts in furtherance thereof,
including without limitation, the following:
(A) As among the Trustees, the Administrative Trustees
shall have the power, duty and authority to act on behalf of the
Trust with respect to the following matters:
(i) the issuance and sale of the Trust
Securities;
(ii) without the consent of any Person, to cause
the Trust to enter into and to execute, deliver and
perform on behalf of the Trust, the Expense Agreement,
and such agreements as may be necessary or desirable in
connection with the consummation of the Underwriting
Agreement (such execution to be by the Administrative
Trustees or any one of them);
(iii) to qualify the Trust to do business in any
jurisdiction as may be necessary or desirable;
(iv) the collection of interest, principal and
any other payments made in respect of the Debentures in
the Payment Account;
(v) the registration of the Preferred Securities
under the Securities Act of 1933, as amended, and under
state securities or blue sky laws, and the
qualification of this Trust Agreement as a trust
indenture under the Trust Indenture Act;
(vi) the listing of the Preferred Securities upon
such securities exchange or exchanges as shall be
determined by the Depositor and the registration of the
Preferred Securities under the Exchange Act, and the
preparation and filing of all periodic and other
reports and other documents pursuant to the foregoing;
(vii) the appointments of a Paying Agent, a
Transfer Agent and a Registrar in accordance with this
Trust Agreement (subject to Section 5.09);
(viii) registering transfers of the Trust
Securities in accordance with this Trust Agreement; and
(ix) the taking of any action incidental to the
foregoing as the Administrative Trustees may from time
to time determine is necessary or advisable to protect
and conserve the Trust Property for the benefit of the
Securityholders (without consideration of the effect of
any such action on any particular Securityholder).
(B) As among the Trustees, the Property Trustee shall have
the power, duty and authority to act on behalf of the Trust with
respect to the following ministerial matters:
(i) the establishment of the Payment Account;
(ii) the receipt of the Debentures;
(iii) the deposit of interest, principal and any
other payments made in respect of the Debentures in the
Payment Account;
(iv) the distribution of amounts owed to the
Securityholders in respect of the Trust Securities in
accordance with the terms of this Trust Agreement;
(v) the sending of notices of default and other
information regarding the Trust Securities and the
Debentures to the Securityholders in accordance with
the terms of this Trust Agreement;
(vi) the distribution of the Trust Property in
accordance with the terms of this Trust Agreement;
(vii) as provided in this Trust Agreement, the
winding up of the affairs of and liquidation of the
Trust and the execution of the certificate of
cancellation to be prepared and filed by the
Administrative Trustees with the Secretary of State of
the State of Delaware; and
(viii) the taking of any ministerial action
incidental to the foregoing as the Property Trustee may
from time to time determine is necessary or advisable
to protect and conserve the Trust Property for the
benefit of the Securityholders (without consideration
of the effect of any such action on any particular
Securityholder).
Subject to this Section 2.07(a)(B), the Property
Trustee shall have none of the duties, powers or authority of the
Administrative Trustee set forth in Section 2.07(a)(A) or the
Depositor set forth in Section 2.07(c). The Property Trustee
shall have the power and authority to exercise all of the rights,
powers and privileges of a holder of Debentures under the
Subordinated Indenture and, if an Event of Default occurs and is
continuing, the Property Trustee may, for the benefit of Holders
of the Trust Securities, in its discretion proceed to protect and
enforce its rights as holder of the Debentures subject to the
rights of the Holder pursuant to the terms of this Trust
Agreement.
(b) So long as this Trust Agreement remains in effect,
the Trust (or the Trustees acting on behalf of the Trust) shall
not undertake any business, activities or transaction except as
expressly provided herein or contemplated hereby. In particular,
the Trustees shall not (i) acquire any investments or engage in
any activities not authorized by this Trust Agreement, (ii) sell,
assign, transfer, exchange, pledge, set-off or otherwise dispose
of any of the Trust Property or interests therein, including to
Securityholders, except as expressly provided herein, (iii) take
any action that would cause the Trust to fail or cease to qualify
as a "grantor trust" for United States federal income tax
purposes and not as an association taxable as a corporation, (iv)
incur any indebtedness for borrowed money or (v) take or consent
to any action that would result in the placement of a Lien on any
of the Trust Property. The Trustees shall defend all claims and
demands of all Persons at any time claiming any Lien on any of
the Trust Property adverse to the interest of the Trust or the
Securityholders in their capacity as Securityholders.
(c) In connection with the issue of the Preferred
Securities, the Depositor shall have the right and responsibility
to assist the Trust with respect to, or effect on behalf of the
Trust, the following (and any actions taken by the Depositor in
furtherance of the following prior to the date of this Trust
Agreement are hereby ratified and confirmed in all respects):
(i) to prepare for filing by the Trust with the
Commission and to execute a registration statement on
Form S-3 in relation to the Preferred Securities,
including any amendments thereto;
(ii) to determine the States in which to take
appropriate action to qualify or register for sale all
or part of the Preferred Securities and to do any and
all such acts, other than actions which must be taken
by or on behalf of the Trust, and advise the Trustees
of actions they must take on behalf of the Trust, and
prepare for execution and filing any documents to be
executed and filed by the Trust or on behalf of the
Trust, as the Depositor deems necessary or advisable in
order to comply with the applicable laws of any such
States;
(iii) to prepare for filing by the Trust an
application to the New York Stock Exchange or any other
national stock exchange or the Nasdaq National Market
for listing upon notice of issuance of any Preferred
Securities and to file or cause the Administrative
Trustees to file thereafter with such exchange such
notifications and documents as may be necessary from
time to time to maintain such listing;
(iv) to prepare for filing by the Trust with the
Commission and to execute a registration statement on
Form 8-A relating to the registration of the Preferred
Securities under Section 12(b) of the Securities
Exchange Act of 1934, as amended ("Exchange Act"),
including any amendments thereto;
(v) to execute and deliver on behalf of the Trust
the Underwriting Agreement and such other agreements as
may be necessary or desirable in connection with the
consummation thereof;
(vi) to select the investment banker or bankers
to act as underwriters with respect to the offer and
sale by the Trust of Preferred Securities ("Offer") and
negotiate the terms of an Underwriting Agreement and
pricing agreement providing for the Offer; and
(vii) to take any other actions necessary or
desirable to carry out any of the foregoing activities.
(d) Notwithstanding anything herein to the contrary,
the Administrative Trustees are authorized and directed to
conduct the affairs of the Trust and to operate the Trust so that
the Trust will not be deemed to be an "investment company"
required to be registered under the Investment Company Act of
1940, as amended, or classified other than as a "grantor trust"
for United States federal income tax purposes and not as an
association taxable as a corporation and so that the Debentures
will be treated as indebtedness of the Depositor for United
States federal income tax purposes. In this connection, subject
to the provisions of Section 10.03, the Depositor and the
Administrative Trustees are authorized to take any action, not
inconsistent with applicable law, the certificate of trust filed
with the Secretary of State of the State of Delaware with respect
to the Trust (as amended or restated from time to time, the
"Certificate of Trust") or this Trust Agreement, that each of the
Depositor and the Administrative Trustees determines in its
discretion to be necessary or desirable for such purposes, as
long as such action does not materially adversely affect the
interests of the Holders of the Preferred Securities.
SECTION 2.08. ASSETS OF TRUST. The assets of the
Trust shall consist of the Trust Property.
SECTION 2.09. TITLE TO TRUST PROPERTY. Legal title to
all Trust Property shall be vested at all times in the Property
Trustee (in its capacity as such) and shall be held and
administered by the Property Trustee for the benefit of the
Securityholders in accordance with this Trust Agreement.
ARTICLE III.
PAYMENT ACCOUNT
SECTION 3.01. PAYMENT ACCOUNT.
(a) On or prior to the Closing Date, the Property
Trustee shall establish the Payment Account. The Property
Trustees and the Paying Agent appointed by the Administrative
Trustees shall have exclusive control and sole right of
withdrawal with respect to the Payment Account for the purpose of
making deposits in and withdrawals from the Payment Account in
accordance with this Trust Agreement. All monies and other
property deposited or held from time to time in the Payment
Account shall be held by the Property Trustee in the Payment
Account for the exclusive benefit of the Holders of Trust
Securities and for distribution as herein provided, including
(and subject to) any priority of payments provided for herein.
(b) The Property Trustee shall deposit in the Payment
Account, promptly upon receipt, all payments of principal or
interest on, and any other payments or proceeds with respect to,
the Debentures. Amounts held in the Payment Account shall not be
invested by the Property Trustee pending distribution thereof.
ARTICLE IV.
DISTRIBUTIONS; REDEMPTION
SECTION 4.01. DISTRIBUTIONS.
(a) Distributions on the Trust Securities shall be
cumulative, and will accumulate whether or not there are funds of
the Trust available for the payment of Distributions.
Distributions shall accrue from the Closing Date, and, except in
the event that the Depositor exercises its right to extend the
interest payment period for the Debentures pursuant to Section
311 of the Subordinated Indenture, shall be payable quarterly in
arrears on March 31, June 30, September 30 and December 31 of
each year, commencing on , 1996. If any date
on which Distributions are otherwise payable on the Trust
Securities is not a Business Day, then the payment of such
Distribution shall be made on the next succeeding day which is a
Business Day (and without any interest or other payment in
respect of any such delay) except that, if such Business Day is
in the next succeeding calendar year, payment of such
distribution shall be made on the immediately preceding Business
Day, in each case, with the same force and effect as if made on
such date (each date on which distributions are payable in
accordance with this Section 4.01(a) a "Distribution Date").
(b) Distributions payable on the Trust Securities
shall be fixed at a rate of % per annum of the Liquidation
Amount of the Trust Securities. The amount of Distributions
payable for any full quarterly period shall be computed on the
basis of twelve 30-day months and a 360-day year and for any
period shorter than a full month, on the basis of the actual
number of days elapsed. If the interest payment period for the
Debentures is extended pursuant to Section 311 of the
Subordinated Indenture, then Distributions on the Preferred
Securities will be deferred for the period equal to the extension
of the interest payment period for the Debentures and the rate
per annum at which Distributions on the Trust Securities
accumulate shall be increased by an amount such that the
aggregate amount of Distributions that accumulate on all Trust
Securities during any such extended interest payment period is
equal to the aggregate amount of interest (including, to the
extent permitted by law, interest payable on unpaid interest at
the percentage rate per annum set forth above, compounded
quarterly) that accrues during any such extended interest payment
period on the Debentures. The amount of Distributions payable
for any period shall include the Additional Amounts, if any.
(c) Distributions on the Trust Securities shall be
made and shall be deemed payable on each Distribution Date only
to the extent that the Trust has funds available in the Payment
Account for the payment of such Distributions.
(d) Distributions on the Trust Securities with respect
to a Distribution Date shall be payable to the Holders thereof as
they appear on the Securities Register for the Trust Securities
on the relevant record date, which shall be 15 days prior to the
relevant Distribution Date.
SECTION 4.02. REDEMPTION.
(a) On each Debenture Redemption Date and at the
maturity date for the Debentures (as defined in the Subordinated
Indenture), the Property Trustee will be required to redeem a
Like Amount of Trust Securities at the Redemption Price plus
accumulated and unpaid Distributions to the date of such payment.
(b) Notice of redemption shall be given by the
Property Trustee by first-class mail, postage prepaid, mailed not
less than 30 nor more than 60 days prior to the Redemption Date
to each Holder of Trust Securities to be redeemed, at such
Holder's address appearing in the Security Register. All notices
of redemption or liquidation shall state:
(i) the Redemption Date;
(ii) the Redemption Price and the amount of
accumulated and unpaid Dividends to be paid on the
Redemption Date;
(iii) the CUSIP number;
(iv) if less than all the Outstanding Trust
Securities are to be redeemed, the identification and
the total Liquidation Amount of the particular Trust
Securities to be redeemed; and
(v) that on the Redemption Date the Redemption
Price plus accumulated and unpaid Distributions to the
date of such payment will become due and payable upon
each such Trust Security to be redeemed and that
interest thereon will cease to accrue on and after said
date.
(c) The Trust Securities redeemed on each Redemption
Date shall be redeemed at the Redemption Price plus accumulated
and unpaid Distributions to the date of such payment with the
proceeds from the contemporaneous redemption of Debentures.
Redemptions of the Trust Securities shall be made and the
Redemption Price plus accumulated and unpaid Distributions to the
date of such payment shall be deemed payable on each Redemption
Date only to the extent that the Trust has funds immediately
available in the Payment Account for such payment.
(d) If the Property Trustee gives a notice of
redemption in respect of any Preferred Securities, then, by 12:00
noon, New York time, on the Redemption Date, subject to Section
4.02(c), the Property Trustee shall irrevocably deposit with the
Paying Agent (or Securities Depository, in the event the
Preferred Securities are book-entry only) funds sufficient to pay
the applicable Redemption Price plus accumulated and unpaid
Distributions to the date of such payment and will give the
Paying Agent irrevocable instructions and authority to pay the
Redemption Price plus accumulated and unpaid Distributions to the
date of such payment to the Holders thereof upon surrender of
their Preferred Securities Certificates. Notwithstanding the
foregoing, Distributions payable on or prior to the redemption
date for any Trust Securities called for redemption shall be
payable to the Holders of such Trust Securities as they appear on
the Securities Register for the Trust Securities on the relevant
record dates for the related Distribution Dates. If notice of
redemption shall have been given and funds deposited as required,
then on the Redemption Date, all rights of Securityholders
holding Trust Securities so called for redemption will cease,
except the right of such Securityholders to receive the
Redemption Price plus accumulated and unpaid Distributions to the
date of such payment, but without interest thereon, and such
Trust Securities will cease to be outstanding. In the event that
any Redemption Date is not a Business Day, then payment of the
Redemption Price payable on such date plus accumulated and unpaid
Distributions to such date shall be made on the next succeeding
day which is a Business Day (and without any interest or other
payment in respect of any such delay). In the event that payment
of the Redemption Price plus accumulated and unpaid Distributions
in respect of any Trust Securities called for redemption is
improperly withheld or refused and not paid either by the Trust
or by the Depositor pursuant to the Guarantee, Distributions on
such Trust Securities will continue to accrue, at the then
applicable rate, from the Redemption Date originally established
by the Trust for such Trust Securities to the date such
Redemption Price plus accumulated and unpaid Distributions is
actually paid, in which case the actual payment date will be
deemed the date fixed for redemption for purposes of calculating
the Redemption Price plus accumulated and unpaid Distributions to
such date.
(e) Payment of the Redemption Price on the Trust
Securities shall be made to the Holders thereof as they appear on
the Securities Register for the Trust Securities on the relevant
record date, which shall be the fifteenth day prior to the
Redemption Date.
(f) If less than all the Outstanding Trust Securities
are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of Trust Securities to be redeemed shall be
allocated 3% to the Common Securities and 97% to the Preferred
Securities. The particular Preferred Securities to be redeemed
shall be selected not more than 60 days prior to the Redemption
Date by the Property Trustee from the Outstanding Preferred
Securities not previously called for redemption, by such method
as the Property Trustee shall deem fair and appropriate and which
may provide for the selection for a redemption of portions (equal
to $25 or integral multiples thereof) of the Liquidation Amount
of Preferred Securities of a denomination larger than $25. The
Property Trustee shall promptly notify the Transfer Agent and
Registrar in writing of the Preferred Securities selected for
redemption and, in the case of any Preferred Securities selected
for partial redemption, the Liquidation Amount thereof to be
redeemed. For all purposes of this Trust Agreement, unless the
context otherwise requires, all provisions relating to the
redemption of Preferred Securities shall relate, in the case of
any Preferred Securities redeemed or to be redeemed only in part,
to the portion of the Liquidation Amount of Preferred Securities
which has been or is to be redeemed.
SECTION 4.03. SUBORDINATION OF COMMON SECURITIES. (a)
Payment of Distributions (including Additional Amounts, if
applicable) on, and the Redemption Price plus accumulated and
unpaid distributions of, the Trust Securities, as applicable,
shall be made pro rata based on the Liquidation Amount of the
Trust Securities; provided, however, that if on any Distribution
Date or Redemption Date a Debenture Event of Default shall have
occurred and be continuing, no payment of any Distribution
(including Additional Amounts, if applicable) on, or Redemption
Price of, any Common Security, and no other payment on account of
the redemption, liquidation or other acquisition of Common
Securities, shall be made unless payment in full in cash of all
accumulated and unpaid Distributions (including Additional
Amounts, if applicable) on all Outstanding Preferred Securities
for all distribution periods terminating on or prior thereto, or
in the case of payment of the Redemption Price plus accumulated
and unpaid Distributions the full amount of such Redemption Price
plus accumulated and unpaid Distributions on all Outstanding
Preferred Securities, shall have been made or provided for, and
all funds immediately available to the Property Trustee shall
first be applied to the payment in full in cash of all
Distributions (including Additional Amounts, if applicable) on,
or Redemption Price plus accumulated and unpaid Distributions of,
Preferred Securities then due and payable.
(b) In the case of the occurrence of any Event of
Default resulting from a Debenture Event of Default, the Holder
of Common Securities will be deemed to have waived any such Event
of Default under this Trust Agreement until the effect of all
such Events of Default with respect to the Preferred Securities
have been cured, waived or otherwise eliminated. Until any such
Events of Default under this Trust Agreement with respect to the
Preferred Securities have been so cured, waived or otherwise
eliminated, the Property Trustee shall act solely on behalf of
the Holders of the Preferred Securities and not the Holder of the
Common Securities, and only the Holders of the Preferred
Securities will have the right to direct the Property Trustee to
act on their behalf.
SECTION 4.04. PAYMENT PROCEDURES. Payments in respect
of the Preferred Securities shall be made by check mailed to the
address of the Person entitled thereto as such address shall
appear on the Securities Register or, if the Preferred Securities
are held by a Securities Depository, such Distributions shall be
made to the Securities Depository, which shall credit the
relevant Persons' accounts at such Securities Depository on the
applicable distribution dates. Payments in respect of the Common
Securities shall be made in such manner as shall be mutually
agreed between the Administrative Trustees and the Holder of the
Common Securities.
SECTION 4.05. TAX RETURNS AND REPORTS. The
Administrative Trustees shall prepare (or cause to be prepared),
at the Depositor's expense and direction, and file all United
States federal, state and local tax and information returns and
reports required to be filed by or in respect of the Trust. In
this regard, the Administrative Trustees shall (a) prepare and
file (or cause to be prepared or filed) the Internal Revenue
Service Form 1041 (or any successor form) required to be filed in
respect of the Trust in each taxable year of the Trust and (b)
prepare and furnish (or cause to be prepared and furnished) to
each Securityholder the related Internal Revenue Service Form
1099, or any successor form or the information required to be
provided on such form. The Administrative Trustees shall provide
the Depositor and the Property Trustee with a copy of all such
returns, reports and schedules promptly after such filing or
furnishing. The Trustees shall comply with United States federal
withholding and backup withholding tax laws and information
reporting requirements with respect to any payments to
Securityholders under the Trust Securities.
ARTICLE V.
TRUST SECURITIES CERTIFICATES
SECTION 5.01. INITIAL OWNERSHIP. Upon the creation of
the Trust by the contribution by the Depositor pursuant to
Section 2.03 and until the issuance of the Trust Securities, and
at any time during which no Trust Securities are outstanding, the
Depositor shall be the sole beneficial owner of the Trust.
SECTION 5.02. THE TRUST SECURITIES CERTIFICATES. The
Trust Securities Certificates shall be issued in denominations of
$25 Liquidation Amount and integral multiples thereof. Subject
to Section 2.04 relating to the original issuance of the
Preferred Securities Certificate registered in the name of the
nominee of The Depository Trust Company, the Trust Securities
Certificates shall be executed on behalf of the Trust by manual
or facsimile signature of at least one Administrative Trustee
and, if executed on behalf of the Trust by facsimile signature,
countersigned by a Transfer Agent or its agent. Trust Securities
Certificates bearing the manual signatures of individuals who
were, at the time when such signatures shall have been affixed,
authorized to sign on behalf of the Trust and, if executed on
behalf of the Trust by facsimile signature, countersigned by a
Transfer Agent or its agent, shall be validly issued and entitled
to the benefits of this Trust Agreement, notwithstanding that
such individuals or any of them shall have ceased to be so
authorized prior to the delivery of such Trust Securities
Certificates or did not hold such offices at the date of delivery
of such Trust Securities Certificates. A transferee of a Trust
Securities Certificate shall become a Securityholder, and shall
be entitled to the rights and subject to the obligations of a
Securityholder hereunder, upon due registration of such Trust
Securities Certificate in such transferee's name pursuant to
Section 5.04 or 5.11.
SECTION 5.03. EXECUTION AND DELIVERY OF TRUST
SECURITIES CERTIFICATES. On the Closing Date, the Administrative
Trustees shall cause Trust Securities Certificates, in an
aggregate Liquidation Amount as provided in Sections 2.04 and
2.05, to be executed on behalf of the Trust, and in the case of
Preferred Securities executed by facsimile signature,
countersigned by a Transfer Agent or its agent, and delivered to
or upon the written order of the Depositor signed by its chairman
of the board, any of its vice presidents or its Treasurer,
without further corporate action by the Depositor, in authorized
denominations. The Depositor agrees to indemnify, defend and
hold each Transfer Agent harmless against any and all costs and
liabilities incurred without negligence arising out of or in
connection with any such countersigning by it.
SECTION 5.04. REGISTRATION OF TRANSFER AND EXCHANGE OF
PREFERRED SECURITIES CERTIFICATES. The Registrar shall keep or
cause to be kept, at its principal corporate office, a Securities
Register in which, subject to such reasonable regulations as it
may prescribe, the Registrar shall provide for the registration
of Preferred Securities Certificates and the Common Securities
Certificates (subject to Section 5.10 in the case of the Common
Securities Certificates) and registration of transfers and
exchanges of Preferred Securities Certificates as herein
provided.
Upon surrender for registration of transfer of any
Preferred Securities Certificate at the office or agency
maintained pursuant to Section 5.08, the Administrative Trustees,
or any one of them, shall execute on behalf of the Trust by
manual or facsimile signature and, if executed on behalf of the
Trust by facsimile signature, cause a Transfer Agent or its agent
to countersign and deliver, in the name of the designated
transferee or transferees, one or more new Preferred Securities
Certificates in authorized denominations of a like aggregate
Liquidation Amount. At the option of a Holder, Preferred
Securities Certificates may be exchanged for other Preferred
Securities Certificates in authorized denominations of the same
class and of a like aggregate Liquidation Amount upon surrender
of the Preferred Securities Certificates to be exchanged at the
office or agency maintained pursuant to Section 5.08.
Every Preferred Securities Certificate presented or
surrendered for registration of transfer or exchange shall be
accompanied by a written instrument of transfer in form
satisfactory to the Administrative Trustees and a Transfer Agent
duly executed by the Holder or such Holder's attorney duly
authorized in writing. Each Preferred Securities Certificate
surrendered for registration of transfer or exchange shall be
canceled and subsequently disposed of by the Administrative
Trustees in accordance with customary practice. The Trust shall
not be required to (i) issue, register the transfer of, or
exchange any Preferred Securities during a period beginning at
the opening of business 15 calendar days before the day of
mailing of a notice of redemption of any Preferred Securities
called for redemption and ending at the close of business on the
day of such mailing or (ii) register the transfer of or exchange
any Preferred Securities so selected for redemption, in whole or
in part, except the unredeemed portion of any such Preferred
Securities being redeemed in part.
No service charge shall be made for any registration of
transfer or exchange of Preferred Securities Certificates, but a
Transfer Agent may require payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection
with any transfer or exchange of Preferred Securities
Certificates.
SECTION 5.05. MUTILATED, DESTROYED, LOST OR STOLEN
TRUST SECURITIES CERTIFICATES. If (a) any mutilated Trust
Securities Certificate shall be surrendered to a Transfer Agent,
or if a Transfer Agent shall receive evidence to its satisfaction
of the destruction, loss or theft of any Trust Securities
Certificate and (b) there shall be delivered to the Transfer
Agent and the Administrative Trustees such security or indemnity
as may be required by them to save each of them and the Depositor
harmless, then in the absence of notice that such Trust
Securities Certificate shall have been acquired by a bona fide
purchaser, the Administrative Trustees, or any one of them, on
behalf of the Trust, shall execute by manual or facsimile
signature and, if execution on behalf of the Trust is by
facsimile signature, countersigned by a Transfer Agent; and the
Administrative Trustees, or any one of them, shall make available
for delivery, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Trust Securities Certificate, a new
Trust Securities Certificate of like class, tenor and
denomination. In connection with the issuance of any new Trust
Securities Certificate under this Section, the Administrative
Trustees or the Transfer Agent may require the payment of a sum
sufficient to cover any tax or other governmental charge that may
be imposed in connection therewith. Any duplicate Trust
Securities Certificate issued pursuant to this Section shall
constitute conclusive evidence of an ownership interest in the
Trust, as if originally issued, whether or not the lost, stolen
or destroyed Trust Securities Certificate shall be found at any
time.
SECTION 5.06. PERSONS DEEMED SECURITYHOLDERS. Prior
to due presentation of a Trust Securities Certificate for
registration of transfer, the Trustees and the Registrar shall be
entitled to treat the Person in whose name any Trust Securities
Certificate shall be registered in the Securities Register as the
owner of such Trust Securities Certificate for the purpose of
receiving Distributions and for all other purposes whatsoever,
and neither the Trustee nor the Registrar shall be bound by any
notice to the contrary.
SECTION 5.07. ACCESS TO LIST OF SECURITYHOLDERS' NAMES
AND ADDRESSES. The Administrative Trustees shall furnish or
cause to be furnished (x) to the Depositor, within 15 days after
receipt by any Administrative Trustee of a request therefor from
the Depositor in writing and (y) to the Property Trustee,
promptly after receipt by any Administrative Trustee of a request
therefor from the Property Trustee in writing in order to enable
the Property Trustee to discharge its obligations under this
Trust Agreement, a list, in such form as the Depositor or the
Property Trustee may reasonably require, of the names and
addresses of the Securityholders as of the most recent Record
Date. If Holders of Trust Securities Certificates evidencing
ownership at such time and for the previous six months not less
than 25% of the outstanding aggregate Liquidation Amount apply in
writing to any Administrative Trustee, and such application
states that the applicants desire to communicate with other
Securityholders with respect to their rights under this Trust
Agreement or under the Trust Securities Certificates and such
application is accompanied by a copy of the communication that
such applicants propose to transmit, then the Administrative
Trustees shall, within five Business Days after the receipt of
such application, afford such applicants access during normal
business hours to the current list of Securityholders. Each
Holder, by receiving and holding a Trust Securities Certificate,
shall be deemed to have agreed not to hold either the Depositor
or the Administrative Trustees accountable by reason of the
disclosure of its name and address, regardless of the source from
which such information was derived.
SECTION 5.08. MAINTENANCE OF OFFICE OR AGENCY. The
Company shall or shall cause the Transfer Agent to maintain in
the Borough of Manhattan, The City of New York, an office or
offices or agency or agencies where Preferred Securities
Certificates may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Company or
the Transfer Agent in respect of the Trust Securities
Certificates may be served. The Company initially designates
Midwest Clearing Corporation, 40 Broad Street, New York, New York
10004 at its principal corporate trust office for such purposes.
The Company shall or shall cause the Transfer Agent to give
prompt written notice to the Depositor, the Property Trustee and
to the Securityholders of any change in any such office or
agency.
SECTION 5.09. APPOINTMENT OF PAYING AGENT. The Paying
Agent shall make distributions to Securityholders from the
Payment Account and shall report the amounts of such
distributions to the Administrative Trustees and the Property
Trustee. Any Paying Agent shall have the revocable power to
withdraw funds from the Payment Account for the purpose of making
the Distributions referred to above. The Property Trustee shall
be entitled to rely upon a certificate of the Paying Agent
stating in effect the amount of such funds so to be withdrawn and
that same are to be applied by the Paying Agent in accordance
with this Section 5.09. The Administrative Trustees or any one
of them may revoke such power and remove the Paying Agent if the
Administrative Trustee or any one of them determines in its sole
discretion that the Paying Agent shall have failed to perform its
obligations under this Trust Agreement in any material respect.
The Paying Agent may choose any co-paying agent that is
acceptable to the Administrative Trustees and the Depositor. The
Paying Agent shall be permitted to resign upon 30 days' written
notice to the Administrative Trustees and the Depositor. In the
event of the removal or resignation of the Paying Agent, the
Administrative Trustees shall appoint a successor that is
reasonably acceptable to the Property Trustee and the Depositor
to act as Paying Agent (which shall be a bank, trust company or
an Affiliate of the Depositor). The Administrative Trustees
shall cause such successor Paying Agent or any additional Paying
Agent appointed by the Administrative Trustees to execute and
deliver to the Trustees an instrument in which such successor
Paying Agent or additional Paying Agent shall agree with the
Trustees that as Paying Agent, such successor Paying Agent or
additional Paying Agent will hold all sums, if any, held by it
for payment to the Securityholders in trust for the benefit of
the Securityholders entitled thereto until such sums shall be
paid to such Securityholders. The Paying Agent shall return all
unclaimed funds to the Property Trustee and upon resignation or
removal of a Paying Agent such Paying Agent shall also return all
funds in its possession to the Property Trustee. The provisions
of Sections 8.01, 8.03 and 8.06 shall apply to the Paying Agent
appointed hereunder, and the Paying Agent shall be bound by the
requirements with respect to paying agents of securities issued
pursuant to the Trust Indenture Act. Any reference in this Trust
Agreement to the Paying Agent shall include any co-paying agent
unless the context requires otherwise.
SECTION 5.10. OWNERSHIP OF COMMON SECURITIES BY
DEPOSITOR. On the Closing Date and on each other date provided
for in Section 2.05, the Depositor shall acquire, and thereafter
retain, beneficial and record ownership of the Common Securities.
Any attempted transfer of the Common Securities shall be void.
The Administrative Trustees shall cause each Common Securities
Certificate issued to the Depositor to contain a legend stating
"THIS CERTIFICATE IS NOT TRANSFERABLE". Common Securities
Certificates representing the Common Securities shall be issued
to the Depositor in the form of a typewritten or definitive
Common Securities Certificate.
SECTION 5.11. DEFINITIVE PREFERRED SECURITIES
CERTIFICATES. Upon initial issuance of the Preferred Securities
the Definitive Preferred Securities Certificates shall be
typewritten, printed, lithographed or engraved or may be produced
in any other manner as is reasonably acceptable to the
Administrative Trustees, as evidenced by the execution thereof by
the Administrative Trustees, or any one of them. The
Administrative Trustees, or any one of them, shall execute on
behalf of the Trust by manual or facsimile signature, and, if
executed by facsimile on behalf of the Trust, countersigned by
the Transfer Agent or its agent the Definitive Preferred
Securities Certificates initially in accordance with the
instructions of the Depositor. Neither the Transfer Agent nor
any of the Administrative Trustees shall be liable for any delay
in delivery of such instructions and may conclusively rely on,
and shall be protected in relying on, such instructions.
SECTION 5.12. BOOK-ENTRY SYSTEM. Some or all of the
Preferred Securities may be registered in the name of the
Securities Depository or a nominee therefor, and held in the
custody of the Securities Depository. In such event, a single
certificate will be issued and delivered to the Securities
Depository for such Preferred Securities, in which case the
Owners of such Preferred Securities will not receive physical
delivery of certificates for Preferred Securities. Except as
provided herein, all transfers of beneficial ownership interests
in such Preferred Securities will be made by book-entry only, and
no investor or other party purchasing, selling or otherwise
transferring beneficial ownership of the Preferred Securities
will receive, hold or deliver any certificate for Preferred
Securities. The Depositor, the Trustees and the Paying Agent
will recognize the Securities Depository or its nominee as the
Holder of Preferred Securities for all purposes, including
notices and voting.
The Administrative Trustees, at the direction and
expense of the Depositor, may from time to time appoint a
Securities Depository or a successor thereto and enter into a
letter of representations or other agreement with such Securities
Depository to establish procedures with respect to the Preferred
Securities. Any Securities Depository shall be a Clearing
Agency.
The Depositor and the Trustees covenant and agree to
meet the requirements of a Securities Depository for the
Preferred Securities with respect to required notices and other
provisions of the letter of representations or agreement executed
with respect to such Preferred Securities.
Whenever the beneficial ownership of any Preferred
Securities is determined through the books of a Securities
Depository, the requirements in this Trust Agreement of holding,
delivering or transferring such Preferred Securities shall be
deemed modified with respect to such Preferred Securities to meet
the requirements of the Securities Depository with respect to
actions of the Trustees, the Depositor and the Paying Agent. Any
provisions hereof permitting or requiring delivery of such
Preferred Securities shall, while such Preferred Securities are
in a book-entry system, be satisfied by the notation on the books
of the Securities Depository in accordance with applicable state
law.
SECTION 5.13. RIGHTS OF SECURITYHOLDERS. The legal
title to the Trust Property is vested exclusively in the Property
Trustee (in its capacity as such) in accordance with Section
2.09, and the Securityholders shall not have any right or title
therein other than an undivided beneficial interest in the assets
of the Trust conferred by their Trust Securities and they shall
have no right to call for any partition or division of property,
profits or rights of the Trust except as described below. The
Trust Securities shall be personal property giving only the
rights specifically set forth therein and in this Trust
Agreement. The Preferred Securities shall have no preemptive or
similar rights and when issued and delivered to Securityholders
against payment of the purchase price therefor will be fully paid
and nonassessable interests in the Trust.
ARTICLE VI.
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
SECTION 6.01. LIMITATIONS ON VOTING RIGHTS.
(a) Except as provided in this Section 6.01, in
Section 10.03 and as otherwise required by law, no Holder of
Preferred Securities shall have any right to vote or in any
manner otherwise control the administration, operation and
management of the Trust or the obligations of the parties hereto,
nor shall anything herein set forth, or contained in the terms of
the Trust Securities Certificates, be construed so as to
constitute the Securityholders from time to time as partners or
members of an association. If the Property Trustee fails to
enforce its rights under the Debentures or this Trust Agreement,
a Holder of Preferred Securities may institute a legal proceeding
directly against the Depositor to enforce the Property Trustee's
rights under the Debentures or this Trust Agreement, to the
fullest extent permitted by law, without first instituting any
legal proceeding against the Property Trustee or any other
person.
(b) So long as any Debentures are held by the Property
Trustee, the Trustees shall not (i) direct the time, method and
place of conducting any proceeding for any remedy available to
the Debenture Trustee, or executing any trust or power conferred
on the Debenture Trustee with respect to such Debentures, (ii)
waive any past default which is waivable under Section 813 of the
Subordinated Indenture, (iii) exercise any right to rescind or
annul a declaration that the principal of all the Debentures
shall be due and payable or (iv) consent to any amendment,
modification or termination of the Subordinated Indenture or the
Debentures, where such consent shall be required, without, in
each case, obtaining the prior approval of the Holders of at
least 66 2/3% of the aggregate Liquidation Amount of the
Outstanding Preferred Securities; provided, however, that where a
consent under the Subordinated Indenture would require the
consent of each holder of Debentures affected thereby, no such
consent shall be given by any Trustee without the prior written
consent of each holder of Preferred Securities. The Trustees
shall not revoke any action previously authorized or approved by
a vote of the Preferred Securities, except pursuant to a
subsequent vote of the Preferred Securities. The Property
Trustee shall notify all Holders of the Preferred Securities of
any notice of default received from the Debenture Trustee with
respect to the Debentures. In addition to obtaining the
foregoing approvals of the Holders of the Preferred Securities,
prior to taking any of the foregoing actions, the Property
Trustee shall, at the expense of the Depositor, obtain an Opinion
of Counsel experienced in such matters to the effect that the
Trust will be classified as a "grantor trust" and not as an
association taxable as a corporation for United States federal
income tax purposes on account of such action.
(c) If any proposed amendment to the Trust Agreement
provides for, or the Trustees otherwise propose to effect, (i)
any action that would materially adversely affect the powers,
preferences or special rights of the Preferred Securities,
whether by way of amendment to the Trust Agreement or otherwise,
or (ii) the dissolution, winding-up or termination of the Trust,
other than pursuant to the terms of this Trust Agreement, then
the Holders of Outstanding Preferred Securities as a class will
be entitled to vote on such amendment or proposal and such
amendment or proposal shall not be effective except with the
approval of the Holders of at least 66 2/3 in Liquidation Amount
of the Outstanding Preferred Securities. No amendment to this
Trust Agreement may be made if, as a result of such amendment,
the Trust would not be classified as a "grantor trust" but as an
association taxable as a corporation for United States federal
income tax purposes.
SECTION 6.02. NOTICE OF MEETINGS. Notice of all
meetings of the Holders of Preferred Securities, stating the
time, place and purpose of the meeting, shall be given by the
Administrative Trustees pursuant to Section 10.08 to each Holder
of a Preferred Security, at his registered address, at least 15
days and not more than 90 days before the meeting. At any such
meeting, any business properly before the meeting may be so
considered whether or not stated in the notice of the meeting.
Any adjourned meeting may be held as adjourned without further
notice.
SECTION 6.03. MEETINGS OF HOLDERS OF PREFERRED
SECURITIES. No annual meeting of Securityholders is required to
be held. The Administrative Trustees, however, shall call a
meeting of Securityholders to vote on any matter upon the written
request of the Holders of 25% of the then Outstanding Preferred
Securities (based upon their aggregate Liquidation Amount) and
may, at any time in their discretion, call a meeting of Holders
of Preferred Securities to vote on any matters as to which the
Holders of Preferred Securities are entitled to vote.
Holders of 50% of the then Outstanding Preferred
Securities (based upon their aggregate Liquidation Amount),
present in person or by proxy, shall constitute a quorum at any
meeting of Securityholders.
If a quorum is present at a meeting, an affirmative
vote by the Holders of Preferred Securities present, in person or
by proxy, holding more than the lesser of (x) 66 2/3% of the then
Outstanding Preferred Securities (based upon their aggregate
Liquidation Amount) held by the Holders of then Outstanding
Preferred Securities present, either in person or by proxy, at
such meeting and (y) 50% of the Outstanding Preferred Securities
(based upon their aggregate Liquidation Amount) shall constitute
the action of the Securityholders, unless this Trust Agreement
requires a greater number of affirmative votes.
SECTION 6.04. VOTING RIGHTS. Securityholders shall be
entitled to one vote for each $25 of Liquidation Amount
represented by their Trust Securities in respect of any matter as
to which such Securityholders are entitled to vote.
SECTION 6.05. PROXIES, ETC. At any meeting of
Securityholders, any Securityholder entitled to vote thereat may
vote by proxy, provided that no proxy shall be voted at any
meeting unless it shall have been placed on file with the
Administrative Trustees, or with such other officer or agent of
the Trust as the Administrative Trustees may direct, for
verification prior to the time at which such vote shall be taken.
Only Securityholders of record shall be entitled to vote. When
Trust Securities are held jointly by several Persons, any one of
them may vote at any meeting in person or by proxy in respect of
such Trust Securities, but if more than one of them shall be
present at such meeting in person or by proxy, and such joint
owners or their proxies so present disagree as to any vote to be
cast, such vote shall not be received in respect of such Trust
Securities. A proxy purporting to be executed by or on behalf of
a Securityholder shall be deemed valid unless challenged at or
prior to its exercise, or, if earlier, until eleven months after
it is sent and the burden of proving invalidity shall rest on the
challenger.
SECTION 6.06. SECURITYHOLDER ACTION BY WRITTEN
CONSENT. Any action which may be taken by Securityholders at a
meeting may be taken without a meeting if Securityholders holding
more than a majority of all Outstanding Trust Securities entitled
to vote in respect of such action (or such larger proportion
thereof as shall be required by any express provision of this
Trust Agreement) shall consent to the action in writing (based
upon their aggregate Liquidation Amount).
SECTION 6.07. RECORD DATE FOR VOTING AND OTHER
PURPOSES. For the purposes of determining the Securityholders
who are entitled to notice of and to vote at any meeting or by
written consent, or to participate in any Distribution on the
Trust Securities in respect of which a record date is not
otherwise provided for in this Trust Agreement, or for the
purpose of any other action, the Administrative Trustees may from
time to time fix a date, not more than 90 days prior to the date
of any meeting of Securityholders or the payment of Distribution
or other action, as the case may be, as a record date for the
determination of the identity of the Securityholders of record
for such purposes.
SECTION 6.08. ACTS OF SECURITYHOLDERS. Any request,
demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Trust Agreement to be
given, made or taken by Securityholders may be embodied in and
evidenced by one or more instruments of substantially similar
tenor signed by such Securityholders in person or by an agent
duly appointed in writing; and, except as otherwise expressly
provided herein, such action shall become effective when such
instrument or instruments are delivered to the Administrative
Trustees. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Securityholders signing such
instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Trust Agreement and (subject
to Section 8.01) conclusive in favor of the Trustees, if made in
the manner provided in this Section.
The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a
witness of such execution or by a certificate of a notary public
or other officer authorized by law to take acknowledgements of
deeds, certifying that the individual signing such instrument or
writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his
individual capacity, such certificate or affidavit shall also
constitute sufficient proof of his authority. The fact and date
of the execution of any such instrument or writing, or the
authority of the Person executing the same, may also be proved in
any other manner which any Trustee deems sufficient.
The ownership of Preferred Securities shall be proved
by the Securities Register.
Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Securityholder of any Trust
Security shall bind every future Securityholder of the same Trust
Security and the Securityholder of every Trust 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 Trustees or the Trust in reliance
thereon, whether or not notation of such action is made upon such
Trust Security.
Without limiting the foregoing, a Securityholder
entitled hereunder to take any action hereunder with regard to
any particular Trust Security may do so with regard to all or any
part of the Liquidation Amount of such Trust Security or by one
or more duly appointed agents each of which may do so pursuant to
such appointment with regard to all or any part of such
Liquidation Amount.
If any dispute shall arise between or among the
Securityholders and the Administrative Trustees with respect to
the authenticity, validity or binding nature of any request,
demand, authorization, direction, consent, waiver or other Act of
such Securityholder or Trustee under this Article VI, then the
determination of such matter by the Property Trustee shall be
conclusive with respect to such matter.
SECTION 6.09. INSPECTION OF RECORDS. Subject to
Section 5.07 concerning access to the list of Securityholders,
upon reasonable notice to the Administrative Trustees and the
Property Trustee, the other records of the Trust shall be open to
inspection by Securityholders during normal business hours for
any purpose reasonably related to such Securityholder's interest
as a Securityholder.
ARTICLE VII.
REPRESENTATIONS AND WARRANTIES OF THE PROPERTY
TRUSTEE AND THE DELAWARE TRUSTEE
SECTION 7.01. PROPERTY TRUSTEE. The Property Trustee
hereby represents and warrants for the benefit of the Depositor
and the Securityholders that:
(a) the Property Trustee is a banking corporation or
trust company duly organized, validly existing and in good
standing under the laws of the State of New York;
(b) the Property Trustee has full corporate power,
authority and legal right to execute, deliver and perform its
obligations under this Trust Agreement and has taken all
necessary action to authorize the execution, delivery and
performance by it of this Trust Agreement;
(c) this Trust Agreement has been duly authorized,
executed and delivered by the Property Trustee and constitutes
the valid and legally binding agreement of the Property Trustee
enforceable against it in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles;
(d) the execution, delivery and performance by the
Property Trustee of this Trust Agreement will not violate,
conflict with or constitute a breach of the Property Trustee's
charter or by-laws; and
(e) neither the authorization, execution or delivery
by the Property Trustee of this Trust Agreement nor the
consummation of any of the transactions by the Property Trustee
contemplated herein require the consent or approval of, the
giving of notice to, the registration with or the taking of any
other action with respect to any governmental authority or agency
under any existing Federal or New York law governing the banking
or trust powers of the Property Trustee.
SECTION 7.02. DELAWARE TRUSTEE. The Delaware Trustee
represents and warrants for the benefit of the Depositor and the
Securityholders that:
(a) the Delaware Trustee is a banking corporation or
trust company duly organized, validly existing and in good
standing under the laws of the State of Delaware;
(b) the Delaware Trustee has full corporate power,
authority and legal right to execute, deliver and perform its
obligations under this Trust Agreement and has taken all
necessary action to authorize the execution, delivery and
performance by it of this Trust Agreement;
(c) this Trust Agreement has been duly authorized,
executed and delivered by the Delaware Trustee and constitutes
the valid and legally binding agreement of the Delaware Trustee
enforceable against it in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles;
(d) the execution, delivery and performance by the
Delaware Trustee of this Trust Agreement will not violate the
Delaware Trustee's charter or by-laws; and
(e) neither the authorization, execution or delivery
by the Delaware Trustee of this Trust Agreement nor the
consummation of any of the transactions by the Delaware Trustee
contemplated herein require the consent or approval of, the
giving of notice to, the registration with or the taking of any
other action with respect to any governmental authority or agency
under any existing Federal or Delaware law governing the banking
or trust powers of the Delaware Trustee.
ARTICLE VIII.
THE TRUSTEES
SECTION 8.01. CERTAIN DUTIES AND RESPONSIBILITIES.
(a) The duties and responsibilities of the Trustees
shall be as provided by this Trust Agreement and, in the case of
the Property Trustee, the Trust Indenture Act, and no implied
covenants or obligations shall be read into this Trust Agreement
against any of the Trustees. Notwithstanding the foregoing, no
provision of this Trust Agreement shall require any of the
Trustees 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. Notwithstanding anything
contained in this Trust Agreement to the contrary, the duties and
responsibilities of the Property Trustee under this Trust
Agreement shall be subject to the protections, exculpations and
limitations on liability afforded to the Property Trustee under
the provisions of the Trust Indenture Act and, to the extent
applicable, Rule 3A-7 under the Investment Company Act of 1940,
as amended, or any successor rule thereunder. Whether or not
therein expressly so provided, every provision of this Trust
Agreement relating to the conduct or affecting the liability of
or affording protection to the Trustees shall be subject to the
provisions of this Section.
(b) All payments made by the Property Trustee or a
Paying Agent in respect of the Trust Securities shall be made
only from the income and proceeds from the Trust Property and
only to the extent that there shall be sufficient income or
proceeds from the Trust Property to enable the Property Trustee
or Paying Agent to make payments in accordance with the terms
hereof. Each Securityholder, by its acceptance of a Trust
Security, agrees that it will look solely to the income and
proceeds from the Trust Property to the extent available for
distribution to it as herein provided and that the Trustees are
not personally liable to it for any amount distributable in
respect of any Trust Security or for any other liability in
respect of any Trust Security. This Section 8.01(b) does not
limit the liability of the Trustees expressly set forth elsewhere
in this Trust Agreement or, in the case of the Property Trustee,
in the Trust Indenture Act.
(c) All duties and responsibilities of the Property
Trustee contained in this Trust Agreement are subject to the
following:
(i) the Property Trustee's sole duty with respect
to the custody, safe keeping and physical preservation
of the Trust Property shall be to deal with such
property in a similar manner as the Property Trustee
deals with similar property for its own account,
subject to the protections and limitations on liability
afforded to the Property Trustee under this Trust
Agreement, the Trust Indenture Act and, to the extent
applicable, Rule 3a-7 under the Investment Company Act
of 1940, as amended;
(ii) the Property Trustee shall have no duty or
liability for or with respect to the value,
genuineness, existence or sufficiency of the Trust
Property or the payment of any taxes or assessments
levied thereon or in connection therewith;
(iii) the Property Trustee shall not be liable
for any interest on any money received by it except as
it may otherwise agree with the Depositor. Money held
by the Property Trustee need not be segregated from
other funds held by it except in relation to the
Payment Account established by the Property Trustee
pursuant to this Trust Agreement and except to the
extent otherwise required by law; and
(iv) the Property Trustee shall not be
responsible for monitoring the compliance by the
Administrative Trustees or the Depositor with their
respective duties under this Trust Agreement, nor shall
the Property Trustee be liable for the default or
misconduct of the Administrative Trustees or the
Depositor.
SECTION 8.02. NOTICE OF DEFAULTS. Within five
Business Days after the occurrence of any Event of Default, the
Property Trustee shall transmit, in the manner and to the extent
provided in Section 10.08, notice of any default known to the
Property Trustee to the Securityholders and the Depositor, unless
such default shall have been cured or waived. 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.
SECTION 8.03. CERTAIN RIGHTS OF PROPERTY TRUSTEE.
Subject to the provisions of Section 8.01 and except as provided
by law:
(i) the Property Trustee may rely and shall be
protected in acting or refraining from acting in good
faith upon any resolution, Opinion of Counsel,
certificate, written representation of a Holder or
transferee, certificate of auditors or any other
certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, appraisal,
bond, debenture, note, other evidence of indebtedness
or other paper or document reasonably believed by it to
be genuine and to have been signed or presented by the
proper party or parties;
(ii) if (A) in performing its duties under this
Trust Agreement the Property Trustee is required to
decide between alternative courses of action or (B) in
construing any of the provisions in this Trust
Agreement the Property Trustee finds the same ambiguous
or inconsistent with any other provisions contained
herein or (C) the Property Trustee is unsure of the
application of any provision of this Trust Agreement,
then, except as to any matter as to which the Preferred
Securityholders are entitled to vote under the terms of
this Trust Agreement, the Property Trustee shall
deliver a notice to the Depositor requesting written
instructions of the Depositor as to the course of
action to be taken. The Property Trustee shall take
such action, or refrain from taking such action, as the
Property Trustee shall be instructed in writing to
take, or to refrain from taking, by the Depositor;
provided, however, that if the Property Trustee does
not receive such instructions of the Depositor within
ten Business Days after it has delivered such notice,
or such reasonably shorter period of time set forth in
such notice (which to the extent practicable shall not
be less than two Business Days), it may, but shall be
under no duty to, take or refrain from taking such
action not inconsistent with this Trust Agreement as it
shall deem advisable and in the best interests of the
Securityholders, in which event the Property Trustee
shall have no liability except for its own bad faith,
negligence or willful misconduct;
(iii) whenever in the administration of this
Trust Agreement the Property Trustee shall deem it
desirable that a matter be proved or established prior
to taking, suffering or omitting any action hereunder,
the Property Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad
faith on its part, request and rely upon an Officers'
Certificate which, upon receipt of such request, shall
be promptly delivered by the Depositor or the
Administrative Trustees;
(iv) the Property Trustee may consult with
counsel of its selection and the written 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;
(v) the Property Trustee shall be under no
obligation to exercise any of the rights or powers
vested in it by this Trust Agreement at the request or
direction of any of the Securityholders pursuant to
this Trust Agreement, unless such Securityholders shall
have offered to the Property Trustee reasonable
security or indemnity against the costs, expenses
(including reasonable attorneys' fees and expenses) and
liabilities which might be incurred by it in complying
with such request or direction;
(vi) the Property 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, approval, bond, debenture, note or other
evidence of indebtedness or other paper or document
reasonably believed by it to be genuine, unless
requested in writing to do so by one or more
Securityholders, but the Property Trustee, in its
discretion, may make such further inquiry or
investigation into such facts or matters as it may see
fit, and, if the Property Trustee shall determine to
make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of
the Depositor personally or by agent or attorney;
(vii) the Property Trustee may execute any of the
trusts or powers hereunder or perform any duties
hereunder either directly or by or through its agents
or attorneys, and the Property 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, provided that the Property Trustee
shall be responsible for its own negligence or
recklessness with respect to selection of any agent or
attorney appointed by it hereunder;
(viii) the Property 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 Trust Agreement;
(ix) the Property Trustee shall not be charged
with knowledge of any default or Event of Default with
respect to the Trust Securities unless either (1) a
Responsible Officer of the Property Trustee shall have
actual knowledge of the default or Event of Default or
(2) written notice of such default or Event of Default
shall have been given to the Property Trustee by the
Depositor, the Administrative Trustees or by any Holder
of the Trust Securities;
(x) no provision of this Trust Agreement shall be
deemed to impose any duty or obligation on the Property
Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed
on it in any jurisdiction in which it shall be illegal,
or in which the Property Trustee shall be unqualified
or incompetent in accordance with applicable law, to
perform any such act or acts or to exercise any such
right, power, duty or obligation; and no permissive or
discretionary power or authority available to the
Property Trustee shall be construed to be a duty;
(xi) no provision of this Trust Agreement shall
require the Property Trustee to expend or risk its own
funds or otherwise incur personal financial liability
in the performance of any of its duties or in the
exercise of any of its rights or powers, if the
Property Trustee shall have reasonable grounds for
believing that the repayment of such funds or liability
is not reasonably assured to it under the terms of this
Trust Agreement or adequate indemnity against such risk
or liability is not reasonably assured to it;
(xii) the Property Trustee shall have no duty to
see to any recording, filing or registration of any
instrument (including any financing or continuation
statement or any tax or securities) (or any
rerecording, refiling or registration thereof);
(xiii) the Property Trustee shall have the right
at any time to seek instructions concerning the
administration of this Trust Agreement from any court
of competent jurisdiction; and
(xiv) whenever in the administration of this
Trust Agreement the Property Trustee shall deem it
desirable to receive instructions with respect to
enforcing any remedy or right or taking any other
action hereunder the Property Trustee (i) may request
instructions from the Holders of the Trust Securities,
which instructions may only be given by the Holders of
the same proportion of Liquidation Amount of the Trust
Securities as would be entitled to direct the Property
Trustee under the terms of this Trust Agreement in
respect of such remedies, rights or actions, (ii) may
refrain from enforcing such remedy or right or taking
such other action until such instructions are received,
and (iii) shall be protected in acting in accordance
with such instructions.
SECTION 8.04. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE
OF SECURITIES. The recitals contained herein and in the Trust
Securities Certificates shall be taken as the statements of the
Trust, and the Trustees do not assume any responsibility for
their correctness. The Trustees make no representations as to
the value or condition of the property of the Trust or any part
thereof or as to the title of the Trust 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 any Trustees hereunder, nor as to the validity or
sufficiency of this Trust Agreement or the Trust Securities. The
Trustees shall not be accountable for the use or application by
the Trust of the proceeds of the Trust Securities in accordance
with Section 2.05.
SECTION 8.05. MAY HOLD SECURITIES. Except as provided
in the definition of the term "Outstanding" in Article I, any
Trustee or any other agent of any Trustee or the Trust, in its
individual or any other capacity, may become the owner or pledgee
of Trust Securities and may otherwise deal with the Trust with
the same rights it would have if it were not a Trustee or such
other agent.
SECTION 8.06. COMPENSATION; FEES; INDEMNITY.
The Depositor agrees
(1) to pay to the Trustees from time to time
reasonable compensation for all services rendered by the
Trustees hereunder (which compensation shall not be limited
by any provision of law in regard to the compensation of a
trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustees upon request for all reasonable
expenses, disbursements and advances reasonably incurred or
made by the Trustees in accordance with any provision of
this Trust Agreement (including the reasonable compensation
and the expenses and disbursements of its agents and
counsel), except any such expense, disbursement or advance
as may be attributable to its negligence (gross negligence,
in the case of any Administrative Trustee), bad faith or
willful misconduct; and
(3) to indemnify each Trustee for, and to hold each
Trustee harmless against, any and all loss, damage, claims,
liability or expense incurred without negligence (gross
negligence, in the case of any Administrative Trustee), bad
faith or willful misconduct on its part, arising out of or
in connection with the acceptance or administration of this
Trust Agreement, including the reasonable 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 Depositor under this Section, each of the Trustees shall have
a lien prior to the Trust Securities upon all property and funds
held or collected by such Trustee as such, except funds held in
trust for the payment of Distributions on the Trust Securities.
The provisions of this Section shall survive the
termination of this Trust Agreement.
SECTION 8.07. CERTAIN TRUSTEES REQUIRED; ELIGIBILITY.
(a) There shall at all times be a Property Trustee hereunder with
respect to the Trust Securities. The Property Trustee shall be a
Person that has a combined capital and surplus of at least
$50,000,000. If any such Person publishes reports of condition
at least annually, pursuant to law or to the requirements of its
supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such Person shall be
deemed to be its combined capital and surplus as set forth in its
most recent report of condition so published. If at any time the
Property Trustee with respect to the Trust Securities 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 VIII.
(b) There shall at all times be one or more
Administrative Trustees hereunder with respect to the Trust
Securities. Each Administrative Trustee shall be either a
natural person who is at least 21 years of age or a legal
entity that shall act through one or more persons authorized
to bind such entity.
(c) There shall at all times be a Delaware Trustee
with respect to the Trust Securities. The Delaware Trustee
shall either be (i) a natural person who is at least 21
years of age and a resident of the State of Delaware or (ii)
a legal entity with its principal place of business in the
State of Delaware that otherwise meets the requirements of
applicable Delaware law and that shall act through one or
more persons authorized to bind such entity.
SECTION 8.08. CONFLICTING INTERESTS.
If the Property Trustee has or shall acquire a
conflicting interest within the meaning of the Trust Indenture
Act, the Property Trustee shall either eliminate such interest or
resign, to the extent and in the manner provided by, and subject
to the provisions of, the Trust Indenture Act and this Trust
Agreement. The Subordinated Indenture and the Guarantee
Agreement shall be deemed to be specifically described in this
Trust Agreement for the purposes of clause (i) of the first
proviso contained in Section 310(b) of the Trust Indenture Act.
SECTION 8.09. CO-TRUSTEES AND SEPARATE TRUSTEE.
Unless a Debenture Event of Default shall have occurred
and be continuing, at any time or times, for the purpose of
meeting the legal requirements of the Trust Indenture Act or of
any jurisdiction in which any part of the Trust Property may at
the time be located, the Depositor and the Property Trustee shall
have power to appoint, and upon the written request of the
Property Trustee, the Depositor shall for such purpose join with
the Property Trustee in the execution, delivery, and performance
of all instruments and agreements necessary or proper to appoint,
one or more Persons approved by the Property Trustee either to
act as co-trustee, jointly with the Property Trustee, of all or
any part of such Trust 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 Depositor does not join
in such appointment within 15 days after the receipt by it of a
request so to do, or in case an Event of Default under the
Subordinated Indenture has occurred and is continuing, the
Property Trustee alone shall have power to make such appointment.
Should any written instrument from the Depositor be
required by any co-trustee or separate trustee so appointed for
more fully confirming 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 Depositor.
Every co-trustee or separate trustee shall, to the
extent permitted by law, but to such extent only, be appointed
subject to the following terms, namely:
(1) The Trust Securities shall be executed 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 Trustees designated for such purpose
hereunder, shall be exercised, solely by such Trustees.
(2) The rights, powers, duties, and obligations hereby
conferred or imposed upon the Property Trustee in respect of
any property covered by such appointment shall be conferred
or imposed upon and exercised or performed by the Property
Trustee or by the Property 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 Property
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.
(3) The Property Trustee at any time, by an instrument
in writing executed by it, with the written concurrence of
the Depositor, may accept the resignation of or remove any
co-trustee or separate trustee appointed under this Section
8.09, and, in case an Event of Default under the
Subordinated Indenture has occurred and is continuing, the
Property Trustee shall have power to accept the resignation
of, or remove, any such co-trustee or separate trustee
without the concurrence of the Depositor. Upon the written
request of the Property Trustee, the Depositor shall join
with the Property Trustee in the execution, delivery, and
performance 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.
(4) No co-trustee or separate trustee hereunder shall
be personally liable by reason of any act or omission of the
Trustee, or any other such trustee hereunder.
(5) The Property Trustee shall not be liable by reason
of any act of a co-trustee or separate trustee.
(6) Any Act of Holders delivered to the Property
Trustee shall be deemed to have been delivered to each such
co-trustee and separate trustee.
SECTION 8.10. RESIGNATION AND REMOVAL; APPOINTMENT OF
SUCCESSOR. No resignation or removal of any Trustee (as the case
may be, the "Relevant Trustee") and no appointment of a successor
Relevant Trustee pursuant to this Article shall become effective
until the acceptance of appointment by the successor Relevant
Trustee in accordance with the applicable requirements of Section
8.11.
The Relevant Trustee may resign at any time by giving
written notice thereof to the Securityholders. If the instrument
of acceptance by a successor Relevant Trustee required by Section
8.11 shall not have been delivered to the Relevant Trustee within
30 days after the giving of such notice of resignation, the
resigning Relevant Trustee may petition any court of competent
jurisdiction for the appointment of a successor Relevant Trustee.
Unless a Debenture Event of Default shall have occurred
and be continuing, the Relevant Trustee may be removed at any
time by Act of the Common Securityholder. If a Debenture Event
of Default shall have occurred and be continuing, the Relevant
Trustee may be removed at such time by Act of the Securityholders
of a majority of the aggregate Liquidation Amount of the
Outstanding Preferred Securities, delivered to the Relevant
Trustee (in its individual capacity and on behalf of the Trust).
If the Relevant Trustee shall resign, be removed or
become incapable of continuing to act as Relevant Trustee at a
time when no Debenture Event of Default shall have occurred and
be continuing, the Common Securityholder, by Act of the Common
Securityholder delivered to the retiring Relevant Trustee, shall
promptly appoint a successor Relevant Trustee or Trustees, and
the retiring Relevant Trustee shall comply with the applicable
requirements of Section 8.11. If the Relevant Trustee shall
resign, be removed or become incapable of continuing to act as
the Relevant Trustee at a time when a Debenture Event of Default
shall have occurred and be continuing, the Preferred
Securityholders, by Act of the Preferred Securityholders of a
majority in Liquidation Amount of the Outstanding Preferred
Securities delivered to the retiring Relevant Trustee, shall
promptly appoint a successor Relevant Trustee or Trustees, and
the Relevant Trustee shall comply with the applicable
requirements of Section 8.11. If no successor Relevant Trustee
shall have been so appointed by the Common Securityholders or the
Preferred Securityholders and accepted appointment in the manner
required by Section 8.11, any Securityholder who has been a
Securityholder for at least six months may, on behalf of himself
and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor
Relevant Trustee.
The retiring Relevant Trustee shall give notice of each
resignation and each removal of the Relevant Trustee and each
appointment of a successor Trustee to all Securityholders in the
manner provided in Section 10.08 and shall give notice to the
Depositor. Each notice shall include the name and address of the
successor Relevant Trustee and, in the case of the Property
Trustee, the address of its Corporate Trust Office.
Notwithstanding the foregoing or any other provision of
this Trust Agreement, in the event any Administrative Trustee or
a Delaware Trustee who is a natural person dies or becomes
incompetent or incapacitated, the vacancy created by such death,
incompetence or incapacity may be filled by (i) the unanimous act
of remaining Administrative Trustees if there are at least two of
them or (ii) otherwise by the Depositor (with the successor in
each case being an individual who satisfies the eligibility
requirements for Administrative Trustees or Delaware Trustee, as
the case may be, set forth in Section 8.07). Additionally,
notwithstanding the foregoing or any other provision of this
Trust Agreement, in the event the Depositor reasonably believes
that any Administrative Trustee who is a natural person has
become incompetent or incapacitated, the Depositor, by notice to
the remaining Trustees, may terminate the status of such Person
as an Administrative Trustee (in which case the vacancy so
created will be filled in accordance with the preceding
sentence).
SECTION 8.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
In case of the appointment hereunder of a successor Relevant
Trustee, the retiring Relevant Trustee and each successor Trustee
shall execute and deliver an amendment hereto wherein each
successor Relevant Trustee shall accept such appointment and
which (1) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, each
successor Relevant Trustee all the rights, powers, trusts and
duties of the retiring Relevant Trustee with respect to the Trust
Securities and the Trust and (2) shall add to or change any of
the provisions of this Trust Agreement as shall be necessary to
provide for or facilitate the administration of the trusts
hereunder by more than one Relevant Trustee, it being understood
that nothing herein or in such amendment shall constitute such
Relevant Trustees co-trustees of the same trust and that each
such Relevant Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder
administered by any other such Relevant Trustee and upon the
execution and delivery of such amendment the resignation or
removal of the retiring Relevant Trustee shall become effective
to the extent provided therein and each such successor Relevant
Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of
the retiring Relevant Trustee; but, on request of the Trust or
any successor Relevant Trustee such retiring Relevant Trustee
shall duly assign, transfer and deliver to such successor Trustee
all Trust Property, all proceeds thereof and money held by such
retiring Relevant Trustee hereunder with respect to the Trust
Securities and the Trust.
Upon request of any such successor Relevant Trustee,
the retiring Relevant Trustee shall execute any and all
instruments for more fully and certainly vesting in and
confirming to such successor Relevant Trustee all such rights,
powers and trusts referred to in the first or second preceding
paragraph, as the case may be.
No successor Relevant Trustee shall accept its
appointment unless at the time of such acceptance such successor
Relevant Trustee shall be qualified and eligible under this
Article VIII.
SECTION 8.12. MERGER, CONVERSION, CONSOLIDATION OR
SUCCESSION TO BUSINESS. Any Person into which the Property
Trustee or the Delaware Trustee or any Administrative Trustee or
any Trustee that is not a natural person may be merged or
converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which
such Relevant Trustee shall be a party, or any Person succeeding
to all or substantially all the corporate trust business of such
Relevant Trustee, shall be the successor of such Relevant Trustee
hereunder, provided such Person shall be otherwise qualified and
eligible under this Article VIII, without the execution or filing
of any paper or any further act on the part of any of the parties
hereto.
SECTION 8.13. PREFERENTIAL COLLECTION OF CLAIMS
AGAINST DEPOSITOR OR TRUST. If and when the Property Trustee
shall be or become a creditor of the Depositor or the Trust (or
any other obligor upon the Debentures or the Trust Securities),
the Property Trustee shall be subject to the provisions of the
Trust Indenture Act regarding the collection of claims against
the Depositor or Trust (or any such other obligor).
SECTION 8.14. REPORTS BY PROPERTY TRUSTEE. (a) the
Property Trustee shall transmit to Securityholders such reports
concerning the Property Trustee and its actions under this Trust
Agreement as may be required pursuant to the Trust Indenture Act
at the times and in the manner provided pursuant thereto. Such
of those reports as are required to be transmitted by the
Property Trustee pursuant to Section 313(a) of the Trust
Indenture Act shall be so transmitted within 60 days after July
31 of each year, commencing July 31, 1996.
(b) A copy of each such report shall, at the time of
such transmission to Holders, be filed by the Property Trustee
with each stock exchange upon which the Trust Securities are
listed, with the Commission and with the Depositor. The
Depositor will notify the Property Trustee when any Trust
Securities are listed on any stock exchange.
SECTION 8.15. REPORTS TO THE PROPERTY TRUSTEE. The
Depositor and the Administrative Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and
information as required by Section 314 (if any) and the
compliance certificate required by Section 314 of the Trust
Indenture Act in the form, in the manner and at the times
required by Section 314 of the Trust Indenture Act.
SECTION 8.16. EVIDENCE OF COMPLIANCE WITH CONDITIONS
PRECEDENT. Each of the Depositor and the Administrative Trustees
on behalf of the Trust shall provide to the Property Trustee such
evidence of compliance with any conditions precedent, if any,
provided for in this Trust Agreement (including any covenants
compliance with which constitutes a condition precedent) that
relate to any of the matters set forth in Section 314(c) of the
Trust Indenture Act. Any certificate or opinion required to be
given by an officer pursuant to Section 314(c)(1) of the Trust
Indenture Act may be given in the form of an Officers'
Certificate.
SECTION 8.17. NUMBER OF TRUSTEES.
(a) The number of Trustees shall be five, provided
that Depositor, by written instrument may increase or decrease
the number of Administrative Trustees.
(b) If a Trustee ceases to hold office for any reason
and the number of Administrative Trustees is not reduced pursuant
to Section 8.17(a), or if the number of Trustees is increased
pursuant to Section 8.17(a), a vacancy shall occur. The vacancy
shall be filled with a Trustee appointed in accordance with
Section 8.10.
(c) The death, resignation, retirement, removal,
bankruptcy, incompetence or incapacity to perform the duties of a
Trustee shall not operate to annul the Trust. Whenever a vacancy
in the number of Administrative Trustees shall occur, until such
vacancy is filled by the appointment of an Administrative Trustee
in accordance with Section 8.10, the Administrative Trustees in
office, regardless of their number (and notwithstanding any other
provision of this Agreement), shall have all the powers granted
to the Administrative Trustees and shall discharge all the duties
imposed upon the Administrative Trustees by this Trust Agreement.
SECTION 8.18. DELEGATION OF POWER.
(a) Any Administrative Trustee may, by power of
attorney consistent with applicable law, delegate to any other
natural person over the age of 21 his or her power for the
purpose of executing any documents contemplated in Section
2.07(a), including any registration statement or amendment
thereto filed with the Commission, or making any other
governmental filing; and
(b) the Administrative Trustees shall have power to
delegate from time to time to such of their number the doing of
such things and the execution of such instruments either in the
name of the Trust or the names of the Administrative Trustees or
otherwise as the Administrative Trustees may deem expedient, to
the extent such delegation is not prohibited by applicable law or
contrary to the provisions of the Trust, as set forth herein.
SECTION 8.19. FIDUCIARY DUTY.
(a) To the extent that, at law or in equity, an
Indemnified Person has duties (including fiduciary duties) and
liabilities relating thereto to the Trust or to any other Covered
Person, an Indemnified Person acting under this Trust Agreement
shall not be liable to the Trust or to any other Covered Person
for its good faith reliance on the provisions of this Trust
Agreement. The provisions of this Trust Agreement, to the extent
that they restrict the duties and liabilities of an Indemnified
Person otherwise existing at law or in equity (other than the
duties imposed on the Property Trustee under the Trust Indenture
Act), are agreed by the parties hereto to replace such other
duties and liabilities of such Indemnified Person;
(b) Unless otherwise expressly provided herein and
subject to the provisions of the Trust Indenture Act:
(i) whenever a conflict of interest exists or
arises between an Indemnified Person and any Covered
Person; or
(ii) whenever this Trust Agreement or any other
agreement contemplated herein or therein provides that
an Indemnified Person shall act in a manner that is, or
provides terms that are, fair and reasonable to the
Trust or any Holder of Trust Securities, the
Indemnified Person shall resolve such conflict of
interest, take such action or provide such terms,
considering in each case the relative interest of each
party (including its own interest) to such conflict,
agreement, transaction or situation and the benefits
and burdens relating to such interests, any customary
or accepted industry practices, and any applicable
generally accepted accounting practices or principles.
In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or
provided by the Indemnified Person shall not constitute
a breach of this Trust Agreement or any other agreement
contemplated herein or of any duty or obligation of the
Indemnified Person at law or in equity or otherwise;
and
(c) Unless otherwise expressly provided herein and
subject to the provisions of the Trust Indenture Act, whenever in
this Trust Agreement an Indemnified Person is permitted or
required to make a decision
(i) in its "discretion" or under a grant of
similar authority, the Indemnified Person shall be
entitled to consider such interests and factors as it
reasonably desires, including its own interests, and
shall have no duty or obligation to give any
consideration to any interest of or factors affecting
the Trust or any other Person; or
(ii) in its "good faith" or under another express
standard, the Indemnified Person shall act under such
express standard and shall not be subject to any other
or different standard imposed by this Trust Agreement
or by applicable law.
ARTICLE IX.
TERMINATION AND LIQUIDATION
SECTION 9.01. TERMINATION UPON EXPIRATION DATE. The
Trust shall automatically terminate on December 31, [ ] (the
"Expiration Date") and the Trust Property shall be distributed in
accordance with Section 9.04.
SECTION 9.02. EARLY TERMINATION. Upon the first to
occur of any of the following events (such first occurrence, an
"Early Termination Event"):
(i) the occurrence of a Bankruptcy Event in
respect of, or the dissolution or liquidation of, the
Depositor;
(ii) the redemption of all of the Preferred
Securities;
(iii) termination of the Trust in accordance with
Section 9.04(d);
(iv) an order for judicial termination of the
Trust having been entered by a court of competent
jurisdiction;
the Trust shall terminate and the Trustees shall take such action
as is required by Section 9.04.
SECTION 9.03. TERMINATION. The respective obligations
and responsibilities of the Trust and the Trustees created hereby
shall terminate upon the latest to occur of the following: (i)
the distribution by the Property Trustee to Securityholders upon
the liquidation of the Trust pursuant to Section 9.04, or upon
the redemption of all of the Trust Securities pursuant to Section
4.02 or 9.04(d), of all amounts required to be distributed
hereunder upon the final payment of the Trust Securities; (ii)
the payment of any expenses owed by the Trust; and (iii) the
discharge of all administrative duties of the Administrative
Trustees, including the performance of any tax reporting
obligations with respect to the Trust or the Securityholders.
SECTION 9.04. LIQUIDATION. (a) If an Early
Termination Event specified in clause (i) or (iv) of Section 9.02
occurs, after satisfaction of creditors of the Trust, if any, as
provided by applicable law, the Trust shall be liquidated by the
Property Trustee as expeditiously as the Property Trustee
determines to be appropriate by distributing to each
Securityholder a Like Amount of Debentures, subject to Section
9.04(e). Notice of liquidation shall be given by the
Administrative Trustees by first-class mail, postage prepaid,
mailed not later than 30 nor more than 60 days prior to the
Liquidation Date to each Holder of Trust Securities at such
Holder's address appearing in the Securities Register. All
notices of liquidation shall:
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation
Date, the Trust Securities will no longer be deemed to
be outstanding and any Trust Securities Certificates
not surrendered for exchange will be deemed to
represent a Like Amount of Debentures; and
(iii) provide such information with respect to
the mechanics by which Holders may exchange Trust
Securities Certificates for Debentures, or if Section
9.04(e) applies receive a Liquidation Distribution, as
the Administrative Trustees or the Property Trustee
shall deem appropriate.
(b) Except where Section 9.02(ii) or the penultimate
sentence of 9.04(e) applies, in order to effect the liquidation
of the Trust, if any, and distribution of the Debentures to
Securityholders, the Property Trustee shall establish a record
date for such distribution (which shall be not more than 45 days
prior to the Liquidation Date) and, either itself acting as
exchange agent or through the appointment of a separate exchange
agent, shall establish such procedures as it shall deem
appropriate to effect the distribution of Debentures in exchange
for the Outstanding Trust Securities Certificates.
(c) Except where Section 9.02(ii) or the penultimate
sentence of 9.04(e) applies, after the Liquidation Date, (i) the
Trust Securities will no longer be deemed to be Outstanding, (ii)
certificates representing a Like Amount of Debentures will be
issued to Holders of Trust Securities Certificates, upon
surrender of such Trust Securities Certificates to the
Administrative Trustees or their agent for exchange, (iii) any
Trust Securities Certificates not so surrendered for exchange
will be deemed to represent a Like Amount of Debentures, accruing
interest at the rate provided for in the Debentures from the last
Distribution Date on which a Distribution was made on such Trust
Certificates until such Trust Securities Certificates are so
surrendered (and until such Trust Securities Certificates are so
surrendered, no payments or interest or principal will be made to
Holders of Trust Securities Certificates with respect to such
Debentures) and (iv) all rights of Securityholders holding Trust
Securities will cease, except the right of such Securityholders
to receive Debentures upon surrender of Trust Securities
Certificates.
(d) If at any time, a Special Event shall occur and be
continuing, the Depositor has the right to (i) redeem the
Debentures in whole but not in part and therefore cause a
mandatory redemption of all the Preferred Securities at the
Redemption Price within 90 days following the occurrence of such
Special Event, or (ii) cause the termination of the Trust.
Further, if at any time, the Trust is not or will not be taxed as
a grantor trust under the United States federal income tax law,
but a Tax Event has not occurred, the Depositor may elect
termination of the Trust. In the event the Depositor elects
under the provisions of this section for the Trust to be
terminated, the Administrative Trustees shall, terminate the
Trust and, after satisfaction of creditors of the Trust, if any,
as provided by applicable law, cause Debentures held by the
Property Trustee having a Like Amount of the Preferred Securities
and the Common Securities to be distributed to the Holders of the
Preferred Securities and the Common Securities on a pro rata
basis in liquidation of such Holders' interests in the Trust (in
the case of such an election following the occurrence of a
Special Event) within 90 days following the occurrence of such
Special Event. The Common Securities will be redeemed on a pro
rata basis with the Preferred Securities, except that if a
Debenture Event of Default has occurred and is continuing, the
Preferred Securities will have a priority over the Common
Securities with respect to payment of the Redemption Price and
accumulated and unpaid Distributions to the date of such payment.
(e) In the event that, notwithstanding the other
provisions of this Section 9.04, whether because of an order for
termination entered by a court of competent jurisdiction or
otherwise, distribution of the Debentures in the manner provided
herein is determined by the Property Trustee not to be practical,
the Trust Property shall be liquidated, and the Trust shall be
dissolved, wound-up or terminated, by the Property Trustee in
such manner as the Property Trustee determines. In such event,
on the date of the dissolution, winding-up or other termination
of the Trust, Securityholders will be entitled to receive out of
the assets of the Trust available for distribution to
Securityholders, after satisfaction of liabilities to creditors
of the Trust, if any, as provided by applicable law, an amount
equal to the Liquidation Amount per Trust Security plus
accumulated and unpaid Distributions thereon to the date of
payment (such amount being the "Liquidation Distribution"). If,
upon any such dissolution, winding up or termination, the
Liquidation Distribution can be paid only in part because the
Trust has insufficient assets available to pay in full the
aggregate Liquidation Distribution, then, subject to the next
succeeding sentence, the amounts payable by the Trust on the
Trust Securities shall be paid on a pro rata basis (based upon
Liquidation Amounts). The Holder of Common Securities will be
entitled to receive Liquidation Distributions upon any such
dissolution, winding-up or termination pro rata (determined as
aforesaid) with Holders of Preferred Securities, except that, if
a Debenture Event of Default has occurred and is continuing or if
a Debenture Event of Default has not occurred solely by reason of
a requirement that time lapse or notice be given, the Preferred
Securities shall have a priority over the Common Securities.
ARTICLE X.
MISCELLANEOUS PROVISIONS
SECTION 10.01. GUARANTEE BY THE DEPOSITOR AND
ASSUMPTION OF OBLIGATIONS. Subject to the terms and conditions
hereof, the Depositor irrevocably and unconditionally guarantees
to each Person to whom the Trust is now or hereafter becomes
indebted or liable (the "Beneficiaries"), and agrees to assume
liability for, the full payment, when and as due, of any and all
Obligations (as hereinafter defined) to such Beneficiaries. As
used herein, "Obligations" means any indebtedness, expenses or
liabilities of the Trust, other than obligations of the Trust to
pay to Holders or other similar interests in the Trust the
amounts due such Holders pursuant to the terms of the Preferred
Securities or such other similar interests, as the case may be.
This guarantee and assumption is intended to be for the benefit,
of, and to be enforceable by, all such Beneficiaries, whether or
not such Beneficiaries have received notice hereof.
SECTION 10.02. LIMITATION OF RIGHTS OF
SECURITYHOLDERS. The death or incapacity of any person having an
interest, beneficial or otherwise, in a Trust Security shall not
operate to terminate this Trust Agreement, nor entitle the legal
representatives or heirs of such person or any Securityholder for
such person, to claim an accounting, take any action or bring any
proceeding in any court for a partition or winding up of the
arrangements contemplated hereby, nor otherwise affect the
rights, obligations and liabilities of the parties hereto or any
of them.
SECTION 10.03. AMENDMENT.
(a) This Trust Agreement may be amended from time to
time by the Trust (on approval of a majority of the
Administrative Trustees and the Depositor, without the consent of
any Securityholders), (i) to cure any ambiguity, correct or
supplement any provision herein or therein which may be
inconsistent with any other provision herein or therein, or to
make any other provisions with respect to matters or questions
arising under this Trust Agreement, which shall not be
inconsistent with the other provisions of this Trust Agreement or
(ii) to modify, eliminate or add to any provisions of this Trust
Agreement to such extent as shall be necessary to ensure that the
Trust will not be classified for United States federal income tax
purposes other than as a "grantor trust" and not as an
association taxable as a corporation at any time that any Trust
Securities are outstanding or to ensure the Trust's exemption
from the status of an "investment company" under the Investment
Company Act of 1940, as amended; provided, however, that, except
in the case of clause (ii), such action shall not adversely
affect in any material respect the interests of any
Securityholder and, in the case of clause (i), any amendments of
this Trust Agreement shall become effective when notice thereof
is given to the Securityholders.
(b) Except as provided in Sections 6.01(c) and
10.03(c), any provision of this Trust Agreement may be amended by
the Administrative Trustees and the Depositor with (i) the
consent of Holders of Trust Securities representing not less than
a majority (based upon Liquidation Amounts) of the Outstanding
Trust Securities and (ii) receipt by the Trustees of an Opinion
of Counsel to the effect that such amendment or the exercise of
any power granted to the Trustees in accordance with such
amendment will not affect the Trust's status as a grantor trust
for federal income tax purposes or the Trust's exemption from
status of an "investment company" under the Investment Company
Act of 1940, as amended.
(c) In addition to and notwithstanding any other
provision in this Trust Agreement, without the consent of each
affected Securityholder (such consent being obtained in
accordance with Section 6.03 or 6.06), this Trust Agreement may
not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely
affect the amount of any Distribution required to be made in
respect of the Trust Securities as of a specified date or (ii)
restrict the right of a Securityholder to institute suit for the
enforcement of any such payment on or after such date.
(d) Notwithstanding any other provisions of this Trust
Agreement, no Trustee shall enter into or consent to any
amendment to this Trust Agreement which would cause the Trust to
fail or cease to qualify for the exemption from status of an
"investment company" under the Investment Company Act of 1940, as
amended, afforded by Rule 3a-5 thereunder.
(e) Notwithstanding anything in this Trust Agreement
to the contrary, without the consent of the Depositor and the
Trustees, this Trust Agreement may not be amended in a manner
which imposes any additional obligation on the Depositor or any
Trustee.
(f) In the event that any amendment to this Trust
Agreement is made, the Administrative Trustees shall promptly
provide to the Depositor a copy of such amendment.
(g) The Property Trustee is entitled to receive an
Opinion of Counsel as conclusive evidence that any amendment to
this Trust Agreement executed pursuant to this Section 10.03 is
authorized or permitted by, and conforms to, the terms of this
Section 10.03, has been duly authorized by and lawfully executed
and delivered on behalf of the other requisite parties, and that
it is proper for the Property Trustee under the provisions of
this Section 10.03 to join in the execution thereof.
SECTION 10.04. SEPARABILITY. In case any provision in
this Trust Agreement or in the Trust Securities Certificates
shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
SECTION 10.05. GOVERNING LAW. This Trust Agreement
and the rights and obligations of each of the Securityholders,
the Trust and the Trustees with respect to this Trust Agreement
and the Trust Securities shall be construed in accordance with
and governed by the laws of the State of Delaware (without regard
to conflict of laws principles).
SECTION 10.06. SUCCESSORS. This Trust Agreement shall
be binding upon and shall inure to the benefit of any successor
to the Trust or the Relevant Trustees or any of them, including
any successor by operation of law.
SECTION 10.07. HEADINGS. The Article and Section
headings are for convenience only and shall not affect the
construction of this Trust Agreement.
SECTION 10.08. NOTICE AND DEMAND. Any notice, demand
or other communication which by any provision of this Trust
Agreement is required or permitted to be given or served to or
upon any Securityholder or the Depositor may be given or served
in writing by deposit thereof, postage prepaid, in the United
States mail, hand delivery or facsimile transmission, in each
case, addressed, (i) in the case of a Preferred Securityholder,
to such Preferred Securityholder as such Securityholder's name
and address may appear on the Securities Register and (ii) in the
case of the Common Securityholder or the Depositor, to Minnesota
Power & Light Company, 30 West Superior Street, Duluth, Minnesota
55802, Attention: Treasurer, facsimile no. (218) 723-3912, with a
copy to the Secretary, facsimile no. (218) 723-3955. Such
notice, demand or other communication to or upon a Securityholder
shall be deemed to have been sufficiently given or made, for all
purposes, upon hand delivery, mailing or transmission.
Any notice, demand or other communication which by any
provision of this Trust Agreement is required or permitted to be
given or served to or upon the Trust, the Property Trustee, the
Delaware Trustee or the Administrative Trustees shall be given in
writing addressed (until another address is published by the
Trust) as follows: (i) with respect to the Property Trustee or
the Delaware Trustee, 101 Barclay Street, 21 West, New York, New
York 10286 marked "Attention: Corporate Trust Administration"
with a copy to: The Bank of New York (Delaware), White Clay
Center, Route 273, Newark, Delaware 19711 and (ii) with respect
to the Trust or the Administrative Trustees, at the address above
for notice to the Depositor, marked "Attention: Administrative
Trustees for MP&L Capital I". Such notice, demand or other
communication to or upon the Trust or the Property Trustee shall
be deemed to have been sufficiently given or made only upon
actual receipt of the writing by the Trust or the Property
Trustee.
SECTION 10.09. AGREEMENT NOT TO PETITION. Each of the
Trustees and the Depositor agrees for the benefit of the
Securityholders that, until at least one year and one day after
the Trust has been terminated in accordance with Article IX, it
shall not file, or join in the filing of, a petition against the
Trust under any bankruptcy, reorganization, arrangement,
insolvency, liquidation or other similar law (including, without
limitation, the United States Bankruptcy Code) (collectively,
"Bankruptcy Laws") or otherwise join in the commencement of any
proceeding against the Trust under any Bankruptcy Law. In the
event the Depositor takes action in violation of this Section
10.09, the Property Trustee agrees, for the benefit of
Securityholders, that it shall file an answer with the bankruptcy
court or otherwise properly contest the filing of such petition
by the Depositor against the Trust or the commencement of such
action and raise the defense that the Depositor has agreed in
writing not to take such action and should be stopped and
precluded therefrom and such other defenses, if any, as counsel
for the Property Trustee or the Trust may assert. The provisions
of this Section 10.09 shall survive the termination of this Trust
Agreement.
SECTION 10.10. CONFLICT WITH TRUST INDENTURE ACT.
(a) This Trust Agreement is subject to the provisions
of the Trust Indenture Act that are required or deemed to be part
of this Trust Agreement and shall, to the extent applicable, be
governed by such provisions.
(b) The Property Trustee shall be the only Trustee
which is a trustee for the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or
conflicts with another provision hereof which is required or
deemed to be included in this Trust Agreement by any of the
provisions of the Trust Indenture Act, such required or deemed
provision shall control.
(d) The application of the Trust Indenture Act to this
Trust Agreement shall not affect the nature of the Trust
Securities as equity securities representing interests in the
Trust.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST
THEREIN BY OR ON BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL
OWNER, WITHOUT ANY SIGNATURE OR FURTHER MANIFESTATION OF ASSENT,
SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE BY THE
SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN
SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST
AGREEMENT AND THE AGREEMENT OF THE TRUST, SUCH SECURITYHOLDER AND
SUCH OTHERS THAT THOSE TERMS AND PROVISIONS SHALL BE BINDING,
OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND SUCH
SECURITYHOLDER AND SUCH OTHERS.
IN WITNESS WHEREOF, the parties have caused this Trust Agreement
to be duly executed, all as of the day and year first above
written.
MINNESOTA POWER & LIGHT COMPANY
By: ______________________________
Title:
THE BANK OF NEW YORK,
as Property Trustee
By: ______________________________
Title:
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
By: ______________________________
Title:
______________________________
PHILIP R. HALVERSON
solely in his capacity as
Administrative Trustee
______________________________
[ ]
solely in her capacity as
Administrative Trustee
______________________________
[ ]
solely in his capacity as
Administrative Trustee
EXHIBIT A
CERTIFICATE OF TRUST
OF
MP&L CAPITAL I
THIS CERTIFICATE OF TRUST of MP&L Capital I (the
"Trust"), dated as of , 1996, is being duly
executed and filed by the undersigned, as trustees, to create a
business trust under the Delaware Business Trust Act (12 Del. C.
-------
Section 3801, et seq.).
-------
1. Name. The name of the business trust being created
hereby is MP&L Capital I.
2. Delaware Trustee. The name and business address of
the trustee of the Trust with a principal place of business in
the State of Delaware are The Bank of New York (Delaware), White
Clay Center, Route 273, Newark, Delaware 19711.
3. Effective Date. This Certificate of Trust shall be
effective as of its filing.
IN WITNESS WHEREOF, the undersigned, being the only
trustees of the Trust, have executed this Certificate of Trust as
of the date first above written.
THE BANK OF NEW YORK (DELAWARE), PHILIP R. HALVERSON,
not in its individual capacity not in his individual capacity
but solely as Trustee but solely as Trustee
By: __________________________ By: _________________________
Name:
Title:
THE BANK OF NEW YORK,
not in its individual capacity
but solely as Trustee
By: __________________________
Name:
Title:
EXHIBIT B
THIS CERTIFICATE IS NOT TRANSFERABLE
Certificate Number Number of Common Securities
C-[ ]
Certificate Evidencing Common Securities
of
MP&L CAPITAL I
Common Securities
(Liquidation Amount $25 per Common Security)
MP&L Capital I, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby
certifies that Minnesota Power & Light Company (the "Holder") is
the registered owner of _____ (_____) common securities of the
Trust representing undivided beneficial interests in the assets
of the Trust and designated the Common Securities (liquidation
amount $25 per Common Security) (the "Common Securities"). In
accordance with Section 5.10 of the Trust Agreement (as defined
below) the Common Securities are not transferable and any
attempted transfer hereof shall be void. The designations,
rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities are set forth in, and this
certificate and the Common Securities represented hereby are
issued and shall in all respects be subject to the terms and
provisions of, the Amended and Restated Trust Agreement of the
Trust dated as of _______ ___, 1995, as the same may be amended
from time to time (the "Trust Agreement"). The Trust will
furnish a copy of the Trust Agreement to the Holder without
charge upon written request to the Trust at its principal place
of business or registered office.
Upon receipt of this certificate, the Holder is bound
by the Trust Agreement and is entitled to the benefits
thereunder.
IN WITNESS WHEREOF, an Administrative Trustee of the
Trust has executed this certificate for and on behalf of the
Trust this ____ day of _________, 199 .
MP&L CAPITAL I
By: ______________________________
not in his (her) individual
capacity, but solely as
Administrative Trustee
EXHIBIT C
AGREEMENT AS TO EXPENSES AND LIABILITIES
AGREEMENT dated as of ________ ___, 1995, between
Minnesota Power & Light Company, a Minnesota corporation
("Minnesota Power"), and MP&L Capital I, a Delaware business
trust (the "Trust").
WHEREAS, the Trust intends to issue its Common
Securities (the "Common Securities") to and receive Debentures
from Minnesota Power and to issue its ___% Quarterly Income
Preferred Securities (the "Preferred Securities") with such
powers, preferences and special rights and restrictions as are
set forth in the Amended and Restated Trust Agreement of the
Trust dated as of ________ __, 1996 as the same may be amended
from time to time (the "Trust Agreement");
WHEREAS, Minnesota Power is the issuer of the
Debentures;
NOW, THEREFORE, in consideration of the acceptance by
each holder of the Preferred Securities, which acceptance
Minnesota Power hereby agrees shall benefit Minnesota Power and
which acceptance Minnesota Power acknowledges will be made in
reliance upon the execution and delivery of this Agreement,
Minnesota Power, including in its capacity as holder of the
Common Securities, and the Trust hereby agree as follows:
ARTICLE I
Section 1.01. Assumption by Minnesota Power. Subject
-----------------------------
to the terms and conditions hereof, Minnesota Power hereby
irrevocably and unconditionally assumes the full payment, when
and as due, of any and all Obligations (as hereinafter defined)
to each person or entity to whom the Trust is now or hereafter
becomes indebted or liable (the "Beneficiaries"). As used
herein, "Obligations" means any indebtedness, expenses or
liabilities of the Trust, other than (i) obligations of the Trust
to pay to holders of any Preferred Securities or other similar
interests in the Trust the amounts due such holders pursuant to
the terms of the Preferred Securities or such other similar
interests, as the case may be and (ii) obligations arising out of
the negligence, willful misconduct or bad faith of the Trustees
of the Trust. This Agreement is intended to be for the benefit
of, and to be enforceable by, all such Beneficiaries, whether or
not such Beneficiaries have received notice hereof.
Section 1.02. Term of Agreement. This Agreement shall
-----------------
terminate and be of no further force and effect upon the date on
which there are no Beneficiaries remaining; provided, however,
that this Agreement shall continue to be effective or shall be
reinstated, as the case may be, if at any time any holder of
Preferred Securities or any Beneficiary must restore payment of
any sums paid under the Preferred Securities, under any
Obligation, under the Guarantee Agreement dated the date hereof
by Minnesota Power and The Bank of New York, as guarantee
trustee, or under this Agreement for any reason whatsoever. This
Agreement is continuing, irrevocable, unconditional and absolute.
Section 1.03. Waiver of Notice. Minnesota Power
----------------
hereby waives notice of acceptance of this Agreement and of any
Obligation to which it applies or may apply, and Minnesota Power
hereby waives presentment, demand for payment, protest, notice of
nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.
Section 1.04. No Impairment. The obligations,
-------------
covenants, agreements and duties of Minnesota Power under this
Agreement shall in no way be affected or impaired by reason of
the happening from time to time of any of the following:
(a) the extension of time for the payment by the Trust
of all or any portion of the Obligations or for the performance
of any other obligation under, arising out of, or in connection
with, the Obligations;
(b) any failure, omission, delay or lack of diligence
on the part of the Beneficiaries to enforce, assert or exercise
any right, privilege, power or remedy conferred on the
Beneficiaries with respect to the Obligations or any action on
the part of the Trust granting indulgence or extension of any
kind; or
(c) the voluntary or involuntary liquidation,
dissolution, sale of any collateral, receivership, insolvency,
bankruptcy, assignment for the benefit of creditors,
reorganization, arrangement, composition or readjustment of debt
of, or other similar proceedings affecting, the Trust or any of
the assets of the Trust.
There shall be no obligation of the Beneficiaries to give notice
to, or obtain the consent of, Minnesota Power with respect to the
happening of any of the foregoing.
Section 1.05. Enforcement. A Beneficiary may enforce
-----------
this Agreement directly against Minnesota Power and Minnesota
Power waives any right or remedy to require that any action be
brought against the Trust or any other person or entity before
proceeding against Minnesota Power.
ARTICLE II
Section 2.01. Binding Effect. All guarantees and
--------------
agreements contained in this Agreement shall bind the
successors, assigns, receivers, trustees and representatives of
Minnesota Power and shall inure to the benefit of the
Beneficiaries.
Section 2.02. Amendment. So long as there remains any
---------
Beneficiary or any Preferred Securities of any series are
outstanding, this Agreement shall not be modified or amended in
any manner adverse to such Beneficiary or to the holders of the
Preferred Securities.
Section 2.03. Notices. Any notice, request or other
-------
communication required or permitted to be given hereunder shall
be given in writing by delivering the same against receipt
therefor by facsimile transmission (confirmed by mail), telex or
by registered or certified mail, addressed as follows (and if so
given, shall be deemed given when mailed or upon receipt of an
answer-back, if sent by telex), to wit:
MP&L Capital I
c/o Philip R. Halverson, Administrative Trustee
30 West Superior Street
Duluth, Minnesota 55802
Facsimile No.: (218) 723-3955
Minnesota Power & Light Company
30 West Superior Street
Duluth, Minnesota 55802
Facsimile No.: (218) 723-3912
Attention: Treasurer
Section 2.04 THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK (WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES).
THIS AGREEMENT is executed as of the day and year first
above written.
MINNESOTA POWER & LIGHT COMPANY
By: ______________________________
Name:
Title:
MP&L CAPITAL I
By: ------------------------------
not in his individual
capacity, but solely as
Administrative Trustee
[Clearing Agency Legend]
EXHIBIT D
Certificate Number Number of Preferred Securities
P- CUSIP NO.
Certificate Evidencing Preferred Securities
of
MP&L CAPITAL I
% Quarterly Income Preferred Securities
(Liquidation Amount $25 per Preferred Security)
MP&L Capital I, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby
certifies that ____________ (the "Holder") is the registered
owner of _____ (_____) preferred securities of the Trust
representing an undivided beneficial interest in the assets of
the Trust and designated the MP&L Capital I % Quarterly
Income Preferred Securities (liquidation amount $25 per Preferred
Security) (the "Preferred Securities"). The Preferred Securities
are transferable on the books and records of the Trust, in person
or by a duly authorized attorney, upon surrender of this
certificate duly endorsed and in proper form for transfer as
provided in Section 5.04 or 5.11 of the Trust Agreement (as
defined below). The designations, rights, privileges,
restrictions, preferences and other terms and provisions of the
Preferred Securities are set forth in, and this certificate and
the Preferred Securities represented hereby are issued and shall
in all respects be subject to the terms and provisions of, the
Amended and Restated Trust Agreement of the Trust dated as of
, 1996, as the same may be amended from time to time
(the "Trust Agreement"). The holder of this certificate is
entitled to the benefits of the Guarantee Agreement of Minnesota
Power & Light Company, a Minnesota corporation, and The Bank of
New York, as guarantee trustee, dated as of ,
1996 (the "Guarantee") to the extent provided therein. The Trust
will furnish a copy of the Trust Agreement and the Guarantee to
the holder of this certificate without charge upon written
request to the Trust at its principal place of business or
registered office.
Upon receipt of this certificate, the holder of this
certificate is bound by the Trust Agreement and is entitled to
the benefits thereunder.
IN WITNESS WHEREOF, one of the Administrative Trustees
of the Trust has executed this certificate for and on behalf of
the Trust.
Dated:
MP&L CAPITAL I
By: _________________________
[ ]
not in his (her)
individual capacity, but
solely as Administrative
Trustee
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and
transfers this Preferred Security to:
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
(Insert assignee's social security or tax identification number)
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
(Insert address and zip code of assignee)
of the Preferred Securities represented by this Preferred
Securities Certificate and irrevocably appoints
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
attorney to transfer such Preferred Securities Certificate on the
books of the Trust. The attorney may substitute another to act
for him or her.
Date:__________________
Signature:________________________
(Sign exactly as your name appears on the other side of this
Preferred Securities Certificate)
Signature:________________________
(Sign exactly as your name appears on the other side of this
Preferred Securities Certificate)
Exhibit 4(c)
__________________________________________
MINNESOTA POWER & LIGHT COMPANY
TO
THE BANK OF NEW YORK
Trustee
_________
Indenture
(For Unsecured Subordinated Debt Securities
relating to Trust Securities)
Dated as of , 1996
__________________________________________
TABLE OF CONTENTS
PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
RECITAL OF THE COMPANY . . . . . . . . . . . . . . . . . . . 1
ARTICLE ONE . . . . . . . . . . . . . . . . . . . . . . . . . 1
Definitions and Other Provisions of General Application . . . 1
SECTION 101. Definitions . . . . . . . . . . . . . . . 1
Act . . . . . . . . . . . . . . . . . . . . . . . . 2
Additional Interest . . . . . . . . . . . . . . . . 2
Affiliate . . . . . . . . . . . . . . . . . . . . . 2
Authenticating Agent . . . . . . . . . . . . . . . 2
Authorized Officer . . . . . . . . . . . . . . . . 2
Board of Directors . . . . . . . . . . . . . . . . 2
Board Resolution . . . . . . . . . . . . . . . . . 2
Business Day . . . . . . . . . . . . . . . . . . . 2
Commission . . . . . . . . . . . . . . . . . . . . 3
Company . . . . . . . . . . . . . . . . . . . . . . 3
Company Request or Company Order . . . . . . . . . 3
Corporate Trust Office . . . . . . . . . . . . . . 3
corporation . . . . . . . . . . . . . . . . . . . . 3
Defaulted Interest . . . . . . . . . . . . . . . . 3
Dollar or $ . . . . . . . . . . . . . . . . . . . . 3
Event of Default . . . . . . . . . . . . . . . . . 3
Governmental Authority . . . . . . . . . . . . . . 3
Government Obligations . . . . . . . . . . . . . . 3
Guarantee . . . . . . . . . . . . . . . . . . . . . 4
Holder . . . . . . . . . . . . . . . . . . . . . . 4
Indenture . . . . . . . . . . . . . . . . . . . . . 4
Interest Payment Date . . . . . . . . . . . . . . . 4
Maturity . . . . . . . . . . . . . . . . . . . . . 4
Officer's Certificate . . . . . . . . . . . . . . . 4
Opinion of Counsel . . . . . . . . . . . . . . . . 4
Outstanding . . . . . . . . . . . . . . . . . . . . 4
Paying Agent . . . . . . . . . . . . . . . . . . . 5
Person . . . . . . . . . . . . . . . . . . . . . . 5
Place of Payment . . . . . . . . . . . . . . . . . 5
Predecessor Security . . . . . . . . . . . . . . . 5
Preferred Securities . . . . . . . . . . . . . . . 6
Redemption Date . . . . . . . . . . . . . . . . . . 6
Redemption Price . . . . . . . . . . . . . . . . . 6
Regular Record Date . . . . . . . . . . . . . . . . 6
Responsible Officer . . . . . . . . . . . . . . . . 6
Securities . . . . . . . . . . . . . . . . . . . . 6
Note: This table of contents shall not, for any purpose be
deemed to be part of the Indenture.
Security Register and Security Registrar . . . . . 6
Senior Indebtedness . . . . . . . . . . . . . . . . 6
Special Record Date . . . . . . . . . . . . . . . . 6
Stated Maturity . . . . . . . . . . . . . . . . . . 6
Trust . . . . . . . . . . . . . . . . . . . . . . . 7
Trust Agreement . . . . . . . . . . . . . . . . . . 7
Trust Indenture Act . . . . . . . . . . . . . . . . 7
Trustee . . . . . . . . . . . . . . . . . . . . . . 7
United States . . . . . . . . . . . . . . . . . . . 7
SECTION 102. Compliance Certificates and Opinions . . . 7
SECTION 103. Form of Documents Delivered to Trustee . . 8
SECTION 104. Acts of Holders . . . . . . . . . . . . . 9
SECTION 105. Notices, etc. to Trustee and Company . . . 10
SECTION 106. Notice to Holders of Securities; Waiver . 11
SECTION 107. Conflict with Trust Indenture Act . . . . 12
SECTION 108. Effect of Headings and Table of Contents . 12
SECTION 109. Successors and Assigns . . . . . . . . . . 12
SECTION 110. Separability Clause . . . . . . . . . . . 12
SECTION 111. Benefits of Indenture . . . . . . . . . . 12
SECTION 112. Governing Law . . . . . . . . . . . . . . 13
SECTION 113. Legal Holidays . . . . . . . . . . . . . . 13
ARTICLE TWO . . . . . . . . . . . . . . . . . . . . . . . . . 13
Security Forms . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 201. Forms Generally . . . . . . . . . . . . . 13
SECTION 202. Form of Trustee's Certificate of
Authentication . . . . . . . . . . . . . . . . . . 14
ARTICLE THREE . . . . . . . . . . . . . . . . . . . . . . . . 14
The Securities . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 301. Amount Unlimited; Issuable in Series . . . 14
SECTION 302. Denominations . . . . . . . . . . . . . . 18
SECTION 303. Execution, Authentication, Delivery and
Dating . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 304. Temporary Securities . . . . . . . . . . . 19
SECTION 305. Registration, Registration of Transfer
and Exchange . . . . . . . . . . . . . . . . . . . 20
SECTION 306. Mutilated, Destroyed, Lost and Stolen
Securities . . . . . . . . . . . . . . . . . . . . 21
SECTION 307. Payment of Interest; Interest Rights
Preserved . . . . . . . . . . . . . . . . . . . . . 22
SECTION 308. Persons Deemed Owners . . . . . . . . . . 23
SECTION 309. Cancellation by Security Registrar . . . . 23
SECTION 310. Computation of Interest . . . . . . . . . 24
SECTION 311. Extension of Interest Payment . . . . . . 24
SECTION 312. Additional Interest. . . . . . . . . . . . 24
ARTICLE FOUR . . . . . . . . . . . . . . . . . . . . . . . . 25
Redemption of Securities . . . . . . . . . . . . . . . . . . 25
SECTION 401. Applicability of Article . . . . . . . . . 25
SECTION 402. Election to Redeem; Notice to Trustee . . 25
SECTION 403. Selection of Securities to Be Redeemed . . 25
SECTION 404. Notice of Redemption . . . . . . . . . . . 26
SECTION 405. Securities Payable on Redemption Date . . 27
SECTION 406. Securities Redeemed in Part . . . . . . . 27
ARTICLE FIVE . . . . . . . . . . . . . . . . . . . . . . . . 28
Sinking Funds . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 501. Applicability of Article . . . . . . . . . 28
SECTION 502. Satisfaction of Sinking Fund Payments
with Securities . . . . . . . . . . . . . . . . . . 28
SECTION 503. Redemption of Securities for Sinking
Fund . . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE SIX . . . . . . . . . . . . . . . . . . . . . . . . . 29
Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 601. Payment of Principal, Premium and
Interest . . . . . . . . . . . . . . . . . . . . . 29
SECTION 602. Maintenance of Office or Agency . . . . . 29
SECTION 603. Money for Securities Payments to Be Held
in Trust . . . . . . . . . . . . . . . . . . . . . 30
SECTION 604. Corporate Existence . . . . . . . . . . . 31
SECTION 605. Maintenance of Properties . . . . . . . . 31
SECTION 606. Annual Officer's Certificate as to
Compliance. . . . . . . . . . . . . . . . . . . . . 32
SECTION 607. Waiver of Certain Covenants . . . . . . . 32
SECTION 608. Restriction on Payment of Dividends . . . 32
SECTION 609. Maintenance of Trust Existence . . . . . . 33
SECTION 610. Rights of Holders of Preferred
Securities . . . . . . . . . . . . . . . . . . . . 33
ARTICLE SEVEN . . . . . . . . . . . . . . . . . . . . . . . . 34
Satisfaction and Discharge . . . . . . . . . . . . . . . . . 34
SECTION 701. Defeasance . . . . . . . . . . . . . . . . 34
SECTION 702. Satisfaction and Discharge of Indenture . 36
SECTION 703. Application of Trust Money . . . . . . . . 37
ARTICLE EIGHT . . . . . . . . . . . . . . . . . . . . . . . . 37
Events of Default; Remedies . . . . . . . . . . . . . . . . . 37
SECTION 801. Events of Default . . . . . . . . . . . . 37
SECTION 802. Acceleration of Maturity; Rescission and
Annulment . . . . . . . . . . . . . . . . . . . . . 39
SECTION 803. Collection of Indebtedness and Suits for
Enforcement by Trustee . . . . . . . . . . . . . . 40
SECTION 804. Trustee May File Proofs of Claim . . . . . 41
SECTION 805. Trustee May Enforce Claims Without
Possession of Securities . . . . . . . . . . . . . 41
SECTION 806. Application of Money Collected . . . . . . 42
SECTION 807. Limitation on Suits . . . . . . . . . . . 42
SECTION 808. Unconditional Right of Holders to Receive
Principal, Premium and Interest . . . . . . . . . . 43
SECTION 809. Restoration of Rights and Remedies . . . . 43
SECTION 810. Rights and Remedies Cumulative . . . . . . 43
SECTION 811. Delay or Omission Not Waiver . . . . . . . 43
SECTION 812. Control by Holders of Securities . . . . . 44
SECTION 813. Waiver of Past Defaults . . . . . . . . . 44
SECTION 814. Undertaking for Costs . . . . . . . . . . 45
SECTION 815. Waiver of Stay or Extension Laws . . . . . 45
ARTICLE NINE . . . . . . . . . . . . . . . . . . . . . . . . 45
The Trustee . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 901. Certain Duties and Responsibilities . . . 45
SECTION 902. Notice of Defaults . . . . . . . . . . . . 46
SECTION 903. Certain Rights of Trustee . . . . . . . . 46
SECTION 904. Not Responsible for Recitals or Issuance
of Securities . . . . . . . . . . . . . . . . . . . 47
SECTION 905. May Hold Securities . . . . . . . . . . . 48
SECTION 906. Money Held in Trust . . . . . . . . . . . 48
SECTION 907. Compensation and Reimbursement . . . . . . 48
SECTION 908. Disqualification; Conflicting Interests. . 49
SECTION 909. Corporate Trustee Required; Eligibility . 49
SECTION 910. Resignation and Removal; Appointment of
Successor . . . . . . . . . . . . . . . . . . . . . 50
SECTION 911. Acceptance of Appointment by Successor . . 52
SECTION 912. Merger, Conversion, Consolidation or
Succession to Business . . . . . . . . . . . . . . 53
SECTION 913. Preferential Collection of Claims Against
Company . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 914. Co-trustees and Separate Trustees. . . . . 54
SECTION 915. Appointment of Authenticating Agent . . . 55
ARTICLE TEN . . . . . . . . . . . . . . . . . . . . . . . . . 57
Holders' Lists and Reports by Trustee and Company . . . . . . 57
SECTION 1001. Lists of Holders . . . . . . . . . . . . 57
SECTION 1002. Reports by Trustee and Company . . . . . 57
ARTICLE ELEVEN . . . . . . . . . . . . . . . . . . . . . . . 57
Consolidation, Merger, Conveyance or Other Transfer . . . . 57
SECTION 1101. Company May Consolidate, etc., Only on
Certain Terms . . . . . . . . . . . . . . . . . . . 57
SECTION 1102. Successor Corporation Substituted . . . . 58
ARTICLE TWELVE . . . . . . . . . . . . . . . . . . . . . . . 58
Supplemental Indentures . . . . . . . . . . . . . . . . . . . 58
SECTION 1201. Supplemental Indentures Without Consent
of Holders . . . . . . . . . . . . . . . . . . . . 58
SECTION 1202. Supplemental Indentures With Consent of
Holders . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 1203. Execution of Supplemental Indentures . . 62
SECTION 1204. Effect of Supplemental Indentures . . . . 62
SECTION 1205. Conformity With Trust Indenture Act . . . 62
SECTION 1206. Reference in Securities to Supplemental
Indentures . . . . . . . . . . . . . . . . . . . . 62
SECTION 1207. Modification Without Supplemental
Indenture . . . . . . . . . . . . . . . . . . . . . 63
ARTICLE THIRTEEN . . . . . . . . . . . . . . . . . . . . . . 63
Meetings of Holders; Action Without Meeting . . . . . . . . . 63
SECTION 1301. Purposes for Which Meetings May Be
Called . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 1302. Call, Notice and Place of Meetings . . . 63
SECTION 1303. Persons Entitled to Vote at Meetings . . 64
SECTION 1304. Quorum; Action . . . . . . . . . . . . . 64
SECTION 1305. Attendance at Meetings; Determination of
Voting Rights;
Conduct and Adjournment of Meetings . . . . 65
SECTION 1306. Counting Votes and Recording Action of
Meetings . . . . . . . . . . . . . . . . . . . . . 66
SECTION 1307. Action Without Meeting . . . . . . . . . 66
ARTICLE FOURTEEN . . . . . . . . . . . . . . . . . . . . . . 67
Immunity of Incorporators, Stockholders, Officers and
Directors . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 1401. Liability Solely Corporate . . . . . . . 67
ARTICLE FIFTEEN . . . . . . . . . . . . . . . . . . . . . . . 67
Subordination of Securities . . . . . . . . . . . . . . . . . 67
SECTION 1501. Securities Subordinate to Senior
Indebtedness. . . . . . . . . . . . . . . . . . . . 67
SECTION 1502. Payment Over of Proceeds of Securities . 68
SECTION 1503. Disputes with Holders of Certain Senior
Indebtedness . . . . . . . . . . . . . . . . . . . 70
SECTION 1504. Subrogation . . . . . . . . . . . . . . . 70
SECTION 1505. Obligation of the Company Unconditional . 70
SECTION 1506. Priority of Senior Indebtedness Upon
Maturity . . . . . . . . . . . . . . . . . . . . . 71
SECTION 1507. Trustee as Holder of Senior
Indebtedness . . . . . . . . . . . . . . . . . . . 71
SECTION 1508. Notice to Trustee to Effectuate
Subordination . . . . . . . . . . . . . . . . . . . 71
SECTION 1509. Modification, Extension, etc. of Senior
Indebtedness . . . . . . . . . . . . . . . . . . . 72
SECTION 1510. Trustee Has No Fiduciary Duty to Holders
of Senior Indebtedness . . . . . . . . . . . . . . 72
SECTION 1511. Paying Agents Other Than the Trustee . . 72
SECTION 1512. Rights of Holders of Senior Indebtedness
Not Impaired . . . . . . . . . . . . . . . . . . . 72
SECTION 1513. Effect of Subordination Provisions;
Termination . . . . . . . . . . . . . . . . . . . . 73
Testimonium . . . . . . . . . . . . . . . . . . . . . . . . . 74
Signatures and Seals . . . . . . . . . . . . . . . . . . . . 74
Acknowledgements . . . . . . . . . . . . . . . . . . . . . . 76
MINNESOTA POWER & LIGHT COMPANY
Reconciliation and tie between Trust Indenture Act of 1939
and Indenture, dated as of , 1996
Trust Indenture Act Section Indenture Section
S310 (a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . 909
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . 909
(a)(3) . . . . . . . . . . . . . . . . . . . . . . . . . 914
(a)(4) . . . . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 908
910
S311 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . 913
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 913
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . 913
S312 (a) . . . . . . . . . . . . . . . . . . . . . . . . . 1001
(b) . . . . . . . . . . . . . . . . . . . . . . . . . 1001
(c) . . . . . . . . . . . . . . . . . . . . . . . . . 1001
S313 (a) . . . . . . . . . . . . . . . . . . . . . . . . . 1002
(b) . . . . . . . . . . . . . . . . . . . . . . . . . 1002
(c) . . . . . . . . . . . . . . . . . . . . . . . . . 1002
S314 (a) . . . . . . . . . . . . . . . . . . . . . . . . . 1002
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . 606
(b) . . . . . . . . . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . 102
(c)(2) . . . . . . . . . . . . . . . . . . . . . . . . . 102
(c)(3) . . . . . . . . . . . . . . . . . . . Not Applicable
(d) . . . . . . . . . . . . . . . . . . . . Not Applicable
(e) . . . . . . . . . . . . . . . . . . . . . . . . . . 102
S315 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . 901
903
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 902
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . 901
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . 901
(e) . . . . . . . . . . . . . . . . . . . . . . . . . . 814
S316 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . 812
813
(a)(1)(A) . . . . . . . . . . . . . . . . . . . . . . . 802
812
(a)(1)(B) . . . . . . . . . . . . . . . . . . . . . . . 813
(a)(2) . . . . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 808
S317 (a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . 803
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . 804
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 603
S318 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . 107
INDENTURE, dated as of , 1996, between
MINNESOTA POWER & LIGHT COMPANY, a corporation duly organized and
existing under the laws of the State of Minnesota (herein called
the "Company"), having its principal office at 30 West Superior
Street, Duluth, Minnesota 55802, and THE BANK OF NEW YORK, a
corporation of the State of New York, having its principal
corporate trust office at 101 Barclay Street, New York, New York
10286, as Trustee (herein called the "Trustee").
RECITAL OF THE COMPANY
The Company has duly authorized the execution and
delivery of this Indenture to provide for the issuance from time
to time of its unsecured subordinated debentures, notes or other
evidences of indebtedness (herein called the "Securities"), in an
unlimited aggregate principal amount to be issued in one or more
series as contemplated herein; 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 One of this Indenture.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the
purchase of the Securities by the Holders thereof, it is mutually
covenanted and agreed, for the equal and proportionate benefit of
all Holders of the Securities or of any series thereof, as
follows:
ARTICLE ONE
Definitions and Other Provisions of General Application
SECTION 101. Definitions.
For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:
(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 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; provided, however, that in
determining generally accepted accounting principles
applicable to the Company, the Company shall, to the extent
required, conform to any order, rule or regulation of any
administrative agency, regulatory authority or other govern-
mental body having jurisdiction over the Company; and
(d) the words "herein", "hereof" and "hereunder" and
other words of similar import refer to this Indenture as a
whole and not to any particular Article, Section or other
subdivision.
Certain terms, used principally in Article Nine, are de-
fined in that Article.
"Act", when used with respect to any Holder of a
Security, has the meaning specified in Section 104.
"Additional Interest" has the meaning specified in
Section 312.
"Affiliate" of any specified Person means any other
Person directly or indirectly controlling or controlled by or
under direct or indirect common control with such specified
Person. For the purposes of this definition, "control" when used
with respect to any specified Person means the power to direct
the management and policies of such Person, directly or through
one or more intermediaries, 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
pursuant to Section 915 to act on behalf of the Trustee to
authenticate one or more series of Securities.
"Authorized Officer" means the Chairman of the Board, the
President, any Vice President, the Treasurer, any Assistant
Treasurer, or any other officer or agent of the Company duly
authorized by the Board of Directors to act in respect of matters
relating to 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.
"Board Resolution" means a copy of a resolution certified
by the Secretary or an Assistant 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 301.
"Commission" means the Securities and Exchange Commis-
sion, 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 execution and delivery of this Indenture such
Commission is not existing and performing the duties now assigned
to it under the Trust Indenture Act, then the body, if any, per-
forming 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 Request" or "Company Order" means a written re-
quest 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
at which at any particular time its corporate trust business
shall be principally administered, which office at the date of
execution and delivery of this Indenture is located at 101
Barclay Street, New York, New York 10286.
"corporation" means a corporation, association, company,
joint stock company or business trust.
"Defaulted Interest" has the meaning specified in Section
307.
"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.
"Event of Default" has the meaning specified in Section
801.
"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 of the foregoing, 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 and entitled to the benefit of the full
faith and credit thereof; and
(b) certificates, depositary receipts or other in-
struments which evidence a direct ownership interest in obli-
gations 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 $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.
"Guarantee" means the guarantee agreement delivered from the
Company to a Trust, for the benefit of the holders of Preferred
Securities issued by such Trust.
"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 supplemental hereto entered
into pursuant to the applicable provisions hereof and shall
include the terms of a particular series of Securities
established as contemplated by Section 301.
"Interest Payment Date", when used with respect to any
Security, means the Stated Maturity of an installment of interest
on such Security.
"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.
"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.
"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 by the Trustee or
delivered to the Trustee for cancellation;
(b) Securities deemed to have been paid in accordance
with Section 701; and
(c) Securities which have been paid pursuant to Section
306 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
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, 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, 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 Affiliate or such obligor owns all Securities
Outstanding under this Indenture, or all Outstanding Securities
of each such series, as the case may be, determined without
regard to this provision) 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 Secu-
rities which the Trustee 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
the pledgee establishes to the satisfaction of the Trustee the
pledgee's 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 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.
"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.
"Person" means any individual, corporation, partnership, joint
venture, trust or unincorporated organization or any Governmental
Authority.
"Place of Payment", when used with respect to the Securities
of any series, means the place or places, specified as contem-
plated by Section 301, at which, subject to Section 602, prin-
cipal of and premium, if any, and interest, if any, on the
Securities of such series 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 Section 306 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.
"Preferred Securities" means any preferred trust interests
issued by a Trust or similar securities issued by permitted
successors to such Trust in accordance with the Trust Agreement
pertaining to such Trust.
"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 301.
"Responsible Officer", when used with respect to the Trustee,
means any officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
"Securities" has the meaning stated in the first recital of
this Indenture and more particularly means any securities authen-
ticated and delivered under this Indenture.
"Security Register" and "Security Registrar" have the
respective meanings specified in Section 305.
"Senior Indebtedness" means all obligations (other than non-
recourse obligations and the indebtedness issued under this
Indenture) of, or guaranteed or assumed by, the Company for
borrowed money, including both senior and subordinated
indebtedness for borrowed money (other than the Securities), or
for the payment of money relating to any lease which is
capitalized on the consolidated balance sheet of the Company and
its subsidiaries in accordance with generally accepted accounting
principles as in effect from time to time, or evidenced by bonds,
debentures, notes or other similar instruments, and in each case,
amendments, renewals, extensions, modifications and refundings of
any such indebtedness or obligations, whether existing as of the
date of this Indenture or subsequently incurred by the Company
unless, in the case of any particular indebtedness, renewal,
extension or refunding, the instrument creating or evidencing the
same or the assumption or guarantee of the same expressly
provides that such indebtedness, renewal, extension or refunding
is not superior in right of payment to or is pari passu with the
Securities; provided that the Company's obligations under the
Guarantee shall not be deemed to be Senior Indebtedness.
"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 307.
"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).
"Trust" means MP&L Capital I, a statutory business trust
created under the laws of the State of Delaware, or any other
Trust designated pursuant to Section 301 hereof or any permitted
successor under the Trust Agreement pertaining to such Trust.
"Trust Agreement" means the Amended and Restated Trust
Agreement, dated as of , 1996, relating to MP&L
Capital I or an Amended and Restated Trust Agreement relating to
a Trust designated pursuant to Section 301 hereof, in each case,
among the Company, as Depositor, the trustees named therein and
several holders referred to therein as they may be amended from
time to time.
"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 with respect to one or more series of Securities
pursuant to the applicable provisions of this Indenture, and
thereafter "Trustee" shall mean or include each Person who is
then a Trustee hereunder, and if at any time there is more than
one such Person, "Trustee" as used with respect to the Securities
of any series shall mean the Trustee with respect to Securities
of that series.
"United States" means the United States of America, its
Territories, its possessions and other areas subject to its
political jurisdiction.
SECTION 102. 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, if requested by the Trustee, 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 (including any covenants compliance with which
constitutes a condition precedent) have been complied with and an
Opinion of Counsel stating that in the opinion of such counsel
all such conditions precedent, if any, have been complied with,
except that in the case of any 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 cer-
tificate 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;
(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 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be
certified by, or covered by an opinion of, any specified Person,
it is not necessary that all such matters be certified by, or
covered by the opinion of, only one such Person, or that they be
so certified or covered by only one document, but one such Person
may certify or give an opinion with respect to some matters and
one or more other such Persons as to other matters, and any such
Person may certify or give an opinion as to such matters in one
or several documents.
Any certificate or opinion of an officer of the Company
may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless
such officer knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with
respect to the matters upon which such Officer's Certificate or
opinion are based are erroneous. Any such certificate or Opinion
of Counsel may be based, insofar as it relates to factual
matters, upon a certificate or opinion of, or representations by,
an officer or officers of the Company stating that the
information with respect to such factual matters is in the
possession of the Company, unless such counsel knows, or in the
exercise of reasonable care should know, that the certificate or
opinion or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute two
or more applications, requests, consents, certificates,
statements, opinions or other instruments under this Indenture,
they may, but need not, be consolidated and form one instrument.
Whenever, subsequent to the receipt by the Trustee of any
Board Resolution, Officer's 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 benefits of this Indenture equally and ratably with all other
Outstanding Securities, except as aforesaid.
SECTION 104. 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
Thirteen, 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 901) 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 1306.
(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 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, no-
tice, 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 authenticated and delivered
after any Act of Holders may, and shall if required by the
Trustee, bear a notation in 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 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.
(g) If the Company shall solicit from Holders any
request, demand, authorization, direction, notice, consent,
waiver or other Act, the Company may, at its option, fix in
advance a record date for the determination of Holders
entitled to give such request, demand, authorization,
direction, notice, consent, waiver or other Act, but the
Company shall have no obligation to do so. If such a record
date is fixed, such request, demand, authorization, direction,
notice, consent, waiver or other Act may be given before or
after such record date, but only the Holders of record at the
close of business on the record date shall be deemed to be
Holders for the purposes of determining whether Holders of the
requisite proportion of the Outstanding Securities have
authorized or agreed or consented to such request, demand,
authorization, direction, notice, consent, waiver or other
Act, and for that purpose the Outstanding Securities shall be
computed as of the record date.
SECTION 105. Notices, etc. to Trustee and Company.
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 herein
expressly provided) if 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 certified or 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, 21 West
New York, New York 10286
Attention: Vice President, Corporate Trust Administration
Telephone: (212) 815-5291
Telecopy: (212) 815-5915
If to the Company, to:
Minnesota Power & Light Company
30 West Superior Street
Duluth, Minnesota 55802
Attention: James K. Vizanko
Telephone: (218) 722-2641
Telecopy: (218) 723-3912
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 106. 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, if any, and not earlier than the earliest date, if any,
prescribed for the giving of such notice.
In case by reason of the suspension of regular mail serv-
ice 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 107. 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 of the provisions 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 108. 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.
SECTION 109. Successors and Assigns.
All covenants and agreements in this Indenture by the
Company and Trustee shall bind their respective successors and
assigns, whether so expressed or not.
SECTION 110. Separability Clause.
In case any provision in this Indenture or the Securities
shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
SECTION 111. Benefits of Indenture.
Nothing in this Indenture or the Securities, express or
implied, shall give to any Person, other than the parties hereto,
their successors hereunder, the Holders and, so long as the
notice described in Section 1513 hereof has not been given, the
holders of Senior Indebtedness, any benefit or any legal or
equitable right, remedy or claim under this Indenture; provided,
however, if the Property Trustee fails to enforce its rights with
respect to the Securities or the related Trust Agreement, a holder
of Preferred Securities may institute a legal proceeding directly
against the Company to enforce the Property Trustee's rights with
respect to the Securities or such Trust Agreement, to the fullest
extent permitted by law, without first instituting any legal
proceeding against the Property Trustee or any other person or
entity.
SECTION 112. Governing Law.
This Indenture and the Securities shall be governed by
and construed in accordance with the laws of the State of New
York, except to the extent that the law of any other jurisdiction
shall be mandatorily applicable.
SECTION 113. 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 in the Board Resolution
or Officer's Certificate which establishes the terms of the
Securities of such series, 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, except that if
such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day,
in each case with the same force and effect, and in the same
amount, as if made on the Interest Payment Date or Redemption
Date, or at the Stated Maturity, as the case may be, 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.
ARTICLE TWO
Security Forms
SECTION 201. Forms Generally.
The definitive Securities of each series shall be in
substantially the form or forms thereof 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 supplemental indenture or Board
Resolution, in each case with such appropriate insertions,
omissions, substitutions and other variations as are required or
permitted by this Indenture, and may have such letters, numbers
or other marks of identification and such legends or endorsements
placed thereon as may be required to comply with the rules of any
securities exchange or 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 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 303 for the
authentication and delivery of such Securities.
Unless otherwise specified as contemplated by Section
301, 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.
SECTION 202. 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 desig-
nated therein referred to in the within-mentioned
Indenture.
_________________________________
as Trustee
By: _____________________________
Authorized Signatory
ARTICLE THREE
The Securities
SECTION 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited;
provided, however, that all Securities shall be issued to a Trust
in exchange for securities of the Company or to evidence loans by
a Trust of the proceeds of the issuance of Preferred Securities
of such Trust plus the amount deposited by the Company with such
Trust from time to time.
The Securities may be issued in one or more series.
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 304, 305, 306, 406 or 1206 and
except for any Securities which, pursuant to Section 303, are
deemed never to have been authenticated and delivered
hereunder);
(c) the Person or Persons (without specific
identification) to whom interest on Securities of such series
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 is payable or any formulary or other
method or other means by which such date or dates shall be
determined, by reference 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 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 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; the right of the Company, if any, to
extend the interest payment periods and the duration of any
such extension as contemplated by Section 311; and the basis
of computation of interest, if other than as provided in
Section 310;
(f) the place or places at which or methods by which (1)
the principal of and premium, if any, and interest, if any, on
Securities of such series shall be payable, (2) registration
of transfer of Securities of such series may be effected, (3)
exchanges of Securities of such series may be effected and (4)
notices and demands to or upon the Company in respect of the
Securities of such series and this Indenture may be served;
the Security Registrar for such series; and if such is the
case, that the principal of such Securities shall be payable
without 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 may be
redeemed, in whole or in part, at the option of the Company
and any restrictions on such redemptions, including but not
limited to a restriction on a partial redemption by the
Company of the Securities of any series, resulting in
delisting of such Securities from any national exchange;
(h) the obligation or obligations, if any, of the
Company to redeem or purchase the Securities of such series
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 404 in the case of
mandatory redemption or redemption at the option of the
Holder;
(i) the denominations in which Securities of such series
shall be issuable if other than denominations of $25 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
shall be payable (if other than in Dollars);
(k) if the principal of or premium, if any, or interest,
if any, on the Securities of such series 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 period or periods within which and the terms
and conditions upon which, such election may be made;
(l) if the principal of or premium, if any, or interest,
if any, on the Securities of such series 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;
(m) if the amount payable in respect of principal of or
premium, if any, or interest, if any, on the Securities of
such series may be determined with reference to an index or
other fact or event ascertainable outside this Indenture, the
manner in which such amounts shall be determined to the extent
not established pursuant to clause (e) of this paragraph;
(n) if other than the principal amount thereof, the
portion of the principal amount of Securities of such series
which shall be payable upon declaration of acceleration of the
Maturity thereof pursuant to Section 802;
(o) any Events of Default, in addition to those
specified in Section 801, with respect to the Securities of
such series, and any covenants of the Company for the benefit
of the Holders of the Securities of such series, in addition
to those set forth in Article Six;
(p) the terms, if any, pursuant to which the Securities
of such series may be converted into or exchanged for shares
of capital stock or other securities of the Company or any
other Person;
(q) the obligations or instruments, if any, which shall
be considered to be Government Obligations in respect of the
Securities of such series denominated in a currency other than
Dollars or in a composite currency, and any additional or
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 701;
(r) if the Securities of such series 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;
(s) if the Securities of such series 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 (g) of Section 1201;
(t) to the extent not established pursuant to clause (r)
of this paragraph, any limitations on the rights of the
Holders of the Securities of such Series 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 the amount or terms thereof;
(u) any exceptions to Section 113, or variation in the
definition of Business Day, with respect to the Securities of
such series;
(v) the designation of the Trust to which Securities of
such series are to be issued; and
(w) any other terms of the Securities of such series not
inconsistent with the provisions of this Indenture.
All Securities of any one series shall be substantially
identical, except as to principal amount and date of issue and
except as may be set forth in the terms of such series as
contemplated above. The Securities of each series shall be
subordinated in right of payment to Senior Indebtedness as
provided in Article Fifteen.
SECTION 302. Denominations.
Unless otherwise provided as contemplated by Section 301
with respect to any series of Securities, the Securities of each
series shall be issuable in denominations of $25 and any integral
multiple thereof.
SECTION 303. Execution, Authentication, Delivery and Dating.
Unless otherwise provided as contemplated by Section 301
with respect to any series of Securities, the Securities shall be
executed on behalf of the Company by an Authorized Officer and
may have the corporate seal of the Company affixed thereto or
reproduced thereon attested by any other Authorized Officer or by
the Secretary or an Assistant Secretary of the Company. 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
or the Secretary or an Assistant Secretary 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.
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 201
and 301;
(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 Sections 201 and
301, establishing such terms;
(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) such Securities, when 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, will have been duly
issued under this Indenture and will constitute valid and
legally binding obligations of the Company, entitled to
the benefits provided by this Indenture, and enforceable
in accordance with their terms, subject, as to
enforcement, to laws relating to or affecting generally
the enforcement of creditors' rights, including, without
limitation, bankruptcy and insolvency laws and to general
principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or
at law).
If the form or terms of the Securities of any series have
been established by or pursuant to a Board Resolution or an
Officer's Certificate as permitted by Sections 201 or 301, the
Trustee shall not be required to authenticate such Securities if
the issuance of such Securities pursuant to this Indenture will
materially or adversely affect the Trustee's own rights, duties
or immunities under the Securities and this Indenture or
otherwise in a manner which is not reasonably acceptable to the
Trustee.
Unless otherwise specified as contemplated by Section 301
with respect to any series of Securities, each Security shall be
dated the date of its authentication.
Unless otherwise specified as contemplated by Section 301
with respect to any series of Securities, 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, 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 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,
and the Company shall deliver such Security to the Trustee for
cancellation as provided in Section 309 together with a written
statement (which need not comply with Section 102 and need not be
accompanied by an Opinion of Counsel) stating that such Security
has never been issued and sold by the Company, 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 304. Temporary Securities.
Pending the preparation of definitive Securities of any
series, the Company may execute, and upon Company Order the
Trustee shall authenticate and deliver, temporary Securities
which are printed, lithographed, typewritten, mimeographed 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.
Unless otherwise specified as contemplated by Section 301
with respect to the Securities of any series, after the
preparation of definitive Securities of such series, the
temporary Securities of such series shall be exchangeable,
without charge to the Holder thereof, for definitive Securities
of such series upon surrender of such temporary Securities at the
office or agency of the Company maintained pursuant to Section
602 in a Place of Payment for such Securities. Upon such
surrender of temporary Securities for such exchange, the Company
shall, except as aforesaid, execute and the Trustee shall
authenticate and deliver in exchange therefor definitive Securi-
ties of the same series, of authorized denominations and of like
tenor and aggregate principal amount.
Until exchanged in full as hereinabove provided, the
temporary Securities of any series shall in all respects be
entitled to the same benefits under this Indenture as definitive
Securities of the same series and of like tenor authenticated and
delivered hereunder.
SECTION 305. Registration, Registration of Transfer and
Exchange.
The Company shall cause to be kept in each office
designated pursuant to Section 602, with respect to the
Securities of each series, a register (all registers kept in
accordance with this Section being collectively referred to as
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 and the
registration of transfer thereof. The Company shall designate
one Person to maintain the Security Register for the Securities
of each series on a consolidated basis, 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 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
301 with respect to the Securities of any series, upon surrender
for registration of transfer of any Security of such series at
the office or agency of the Company maintained pursuant to
Section 602 in a Place of Payment for such series, the Company
shall execute, and the Trustee shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more
new Securities of the same series, of authorized denominations
and of like tenor and aggregate principal amount.
Except as otherwise specified as contemplated by Section
301 with respect to the Securities of any series, any Security of
such series may be exchanged at the option of the Holder, for one
or more new Securities of the same series, 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.
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 sat-
isfactory 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 301
with respect to Securities of any series, 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
304, 406 or 1206 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 during a period of 15 days
immediately preceding the date of the mailing of any notice of
redemption of such Securities 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 306. 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 of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
If there shall be delivered to the Company and the Trus-
tee (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 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, 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 original additional contractual obligation of the
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 307. Payment of Interest; Interest Rights Preserved.
Unless otherwise specified as contemplated by Section 301
with respect to the Securities of any series, 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.
Subject to Section 311, 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 Secu-
rities 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 on or prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of
the Persons entitled to such Defaulted Interest as in this
clause provided. Thereupon the Trustee shall fix a Special
Record Date for the payment of such Defaulted Interest which
shall be not more than 15 days and not less than 10 days prior
to the date of the proposed payment and not less than 10 days
after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Company of
such Special Record Date and, in the name and at the expense
of the Company, shall promptly cause notice of the proposed
payment of such Defaulted Interest and the Special Record Date
therefor to be mailed, first-class postage prepaid, to each
Holder of Securities of such series at the address of such
Holder as it appears in the Security Register, not less than
10 days prior to such Special Record Date. Notice of the pro-
posed 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 Secu-
rities 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
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 305, 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 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration
of transfer, the Company, the Trustee and any agent of the
Company or the Trustee may treat the Person in whose name such
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 305 and 307) 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 309. 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, except
as expressly permitted by this Indenture. All canceled
Securities held by the Security Registrar shall be disposed of in
accordance with a Company Order delivered to the Security
Registrar and the Trustee, and the Security Registrar shall
promptly deliver a certificate of disposition to the Trustee and
the Company unless, by a Company Order, similarly delivered, the
Company shall direct that canceled Securities be returned to it.
The Security Registrar shall promptly deliver evidence of any
cancellation of a Security in accordance with this Section 309 to
the Trustee and the Company.
SECTION 310. Computation of Interest.
Except as otherwise specified as contemplated by Section
301 for Securities of any series, interest on the Securities of
each series shall be computed on the basis of a 360-day year
consisting of twelve 30-day months and for any period shorter
than a full month, on the basis of the actual number of days
elapsed in such period.
SECTION 311. Extension of Interest Payment.
The Company shall have the right at any time, so long as the
Company is not in default in the payment of interest on the
Securities of any series hereunder, to extend interest payment
periods on all Securities of one or more series, if so specified
as contemplated by Section 301 with respect to such Securities
and upon such terms as may be specified as contemplated by
Section 301 with respect to such Securities.
SECTION 312. Additional Interest.
So long as any Preferred Securities remain outstanding,
if the Trust which issued such Preferred Securities shall be
required to pay, with respect to its income derived from the
interest payments on the Securities of any series, any amounts
for or on account of any taxes, duties, assessments or
governmental charges of whatever nature imposed by the United
States, or any other taxing authority, then, in any such case,
the Company will pay as interest on such series such additional
interest ("Additional Interest") as may be necessary in order
that the net amounts received and retained by such Trust after
the payment of such taxes, duties, assessments or governmental
charges shall result in such Trust's having such funds as it
would have had in the absence of the payment of such taxes,
duties, assessments or governmental charges.
ARTICLE FOUR
Redemption of Securities
SECTION 401. Applicability of Article.
Securities of any series which are redeemable before
their Stated Maturity shall be redeemable in accordance with
their terms and (except as otherwise specified as contemplated by
Section 301 for Securities of such series) in accordance with
this Article.
SECTION 402. 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 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 Offi-
cer's Certificate evidencing compliance with such restriction or
condition.
SECTION 403. Selection of Securities to Be Redeemed.
If less than all the Securities of any series are to be
redeemed, the particular Securities to be redeemed shall be
selected by the Trustee from the Outstanding Securities of such
series not previously called for redemption, by such method as
shall be provided for any particular series, or, in the absence
of any such provision, by such method as the Trustee shall deem
fair and appropriate and which may provide for the selection for
redemption of portions (equal to the minimum authorized
denomination for Securities of such series or any integral
multiple thereof) of the principal amount of Securities of such
series of a denomination larger than the minimum authorized
denomination for Securities of such series; 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, 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 Trustee, 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 Trustee shall promptly notify the Company and the
Security Registrar 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 404. Notice of Redemption.
Notice of redemption shall be given in the manner pro-
vided in Section 106 to the Holders of the Securities to be
redeemed not less than 30 nor more than 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 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,
(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 301 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.
Unless otherwise specified with respect to any Securities
in accordance with Section 301, 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 701, 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 405. 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 sat-
isfied, 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 301 with respect to such
Security; and provided, further, that except as otherwise
specified as contemplated by Section 301 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
business on the related Regular Record Date according to the
terms of such Security and subject to the provisions of Section
307.
SECTION 406. 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, 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 FIVE
Sinking Funds
SECTION 501. Applicability of Article.
The provisions of this Article shall be applicable to any
sinking fund for the retirement of the Securities of any series,
except as otherwise specified as contemplated by Section 301 for
Securities of such series.
The minimum amount of any sinking fund payment provided
for by the terms of Securities of any series is herein referred
to as a "mandatory sinking fund payment", and any payment in
excess of such minimum amount provided for by the terms of
Securities of any series is herein referred to as an "optional
sinking fund payment". If provided for by the terms of
Securities of any series, the cash amount of any sinking fund
payment may be subject to reduction as provided in Section 502.
Each sinking fund payment shall be applied to the redemption of
Securities of the series in respect of which it was made as
provided for by the terms of such Securities.
SECTION 502. Satisfaction of Sinking Fund Payments with
Securities.
The Company (a) may deliver to the Trustee Outstanding
Securities (other than any previously called for redemption) of a
series in respect of which a mandatory sinking fund payment is to
be made and (b) may apply as a credit Securities of such series
which have been redeemed either at the election of the Company
pursuant to the terms of such Securities or through the
application of permitted optional sinking fund payments pursuant
to the terms of such Securities or Outstanding Securities
purchased by the Company, in each case in satisfaction of all or
any part of such mandatory sinking fund payment with respect to
the Securities of such series; provided, however, that no
Securities shall be applied in satisfaction of a mandatory
sinking fund payment if such Securities shall have been
previously so applied. Securities so applied shall be received
and credited for such purpose by the Trustee at the Redemption
Price specified in such Securities for redemption through
operation of the sinking fund and the amount of such mandatory
sinking fund payment shall be reduced accordingly.
SECTION 503. Redemption of Securities for Sinking Fund.
Not less than 45 days prior to each sinking fund payment
date for the Securities of any series, the Company shall deliver
to the Trustee an Officer's Certificate specifying:
(a) the amount of the next succeeding mandatory sinking
fund payment for such series;
(b) the amount, if any, of the optional sinking fund
payment to be made together with such mandatory sinking fund
payment;
(c) the aggregate sinking fund payment;
(d) the portion, if any, of such aggregate sinking fund
payment which is to be satisfied by the payment of cash;
(e) the portion, if any, of such aggregate sinking fund
payment which is to be satisfied by delivering and crediting
Securities of such series pursuant to Section 502 and stating
the basis for such credit and that such Securities have not
previously been so credited, and the Company shall also
deliver to the Trustee any Securities to be so delivered. If
the Company shall not deliver such Officer's Certificate, the
next succeeding sinking fund payment for such series shall be
made entirely in cash in the amount of the mandatory sinking
fund payment. Not less than 30 days before each such sinking
fund payment date the Trustee shall select the Securities to
be redeemed upon such sinking fund payment date in the manner
specified in Section 403 and cause notice of the redemption
thereof to be given in the name of and at the expense of the
Company in the manner provided in Section 404. Such notice
having been duly given, the redemption of such Securities
shall be made upon the terms and in the manner stated in
Sections 405 and 406.
ARTICLE SIX
Covenants
SECTION 601. Payment of Principal, Premium and Interest.
The Company shall pay the principal of and premium, if
any, and interest, if any (including Additional Interest), on the
Securities of each series in accordance with the terms of such
Securities and this Indenture.
SECTION 602. Maintenance of Office or Agency.
The Company shall maintain in each Place of Payment for
the Securities of each series 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 106. If at any time the Company shall fail
to maintain any such required office or agency in respect of
Securities of any series, 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.
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, 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 301 with respect to the Securities of such series, 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 106, 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 603. 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, 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, 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 sum 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, 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
(c) at any time during the continuance of any such
default, 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 Seven; 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 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 a 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, may 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 30 days from the date of such
mailing, any unclaimed balance of such money then remaining will
be paid to the Company.
SECTION 604. Corporate Existence.
Subject to the rights of the Company under Article
Eleven, the Company shall do or cause to be done all things
necessary to preserve and keep in full force and effect its
corporate existence.
SECTION 605. Maintenance of Properties.
The Company shall cause (or, with respect to property
owned in common with others, make reasonable effort to cause) all
its properties used or useful in the conduct of its business 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
all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as, in the judgment of the Company, may
be necessary so that the business carried on in connection
therewith may be properly conducted; provided, however, that
nothing in this Section shall prevent the Company from
discontinuing, or causing the discontinuance of, the operation
and maintenance of any of its properties if such discontinuance
is, in the judgment of the Company, desirable in the conduct of
its business.
SECTION 606. Annual Officer's Certificate as to Compliance.
Not later than September 15 in each year, commencing
September 15, 1996, the Company shall deliver to the Trustee an
Officer's Certificate which need not comply with Section 102,
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.
SECTION 607. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply
with any term, provision or condition set forth in (a) Section
602 or any additional covenant or restriction specified with
respect to the Securities of any series, as contemplated by
Section 301, 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 with respect to which
compliance with Section 602 or such additional 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 and (b) Section 604, 605 or Article Eleven 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 the case of (a) or
(b), 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; provided, however, so long as a Trust holds Securities of
any series, such Trust may not waive compliance or waive any
default in compliance by the Company with any covenant or other
term contained in this Indenture or the Securities of such series
without the approval of the holders of at least a majority in
aggregate liquidation preference of the outstanding Preferred
Securities issued by such Trust affected, obtained as provided in
the Trust Agreement pertaining to such Trust.
SECTION 608. Restriction on Payment of Dividends.
So long as any Preferred Securities of any series remain
outstanding, the Company shall not declare or pay any dividend
on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Company's capital stock, or make any
guarantee payments with respect to the foregoing (other than
payments under the Guarantee relating to such Preferred
Securities) if at such time (a) the Company shall be in default
with respect to its payment or other obligations under the
Guarantee relating to such Preferred Securities, (b) there shall
have occurred and be continuing a payment default (whether before
or after expiration of any period of grace) or an Event of
Default hereunder or (c) the Company shall have elected to extend
any interest payment period as provided in Section 311, and any
such period, or any extension thereof, shall be continuing.
SECTION 609. Maintenance of Trust Existence.
So long as Preferred Securities of any series remain
outstanding, the Company shall (i) maintain direct or indirect
ownership of all interests in the Trust which issued such
Preferred Securities, other than such Preferred Securities, (ii)
not voluntarily (to the extent permitted by law) dissolve,
liquidate or wind up such Trust, except in connection with a
distribution of the Securities to the holders of the Preferred
Securities in liquidation of such Trust, (iii) remain the sole
Depositor under the Trust Agreement (the "Depositor") of such
Trust and timely perform in all material respects all of its
duties as Depositor of such Trust, and (iv) use reasonable
efforts to cause such Trust to remain a business trust and
otherwise continue to be treated as a grantor trust for Federal
income tax purposes provided that any permitted successor to the
Company under this Indenture may succeed to the Company's duties
as Depositor of such Trust; and provided further that the Company
may permit such Trust to consolidate or merge with or into
another business trust or other permitted successor under the
Trust Agreement pertaining to such Trust so long as the Company
agrees to comply with this Section 609 with respect to such
successor business trust or other permitted successor.
SECTION 610. Rights of Holders of Preferred Securities.
The Company agrees that, for so long as any Preferred
Securities remain outstanding, its obligations under this
Indenture will also be for the benefit of the holders from time
to time of Preferred Securities, and the Company acknowledges and
agrees that if the Property Trustee fails to enforce its rights
with respect to the Securities or the related Trust Agreement,
a holder of Preferred Securities may institute a legal proceeding
directly against the Company to enforce the Property Trustee's
rights with respect to the Securities or such Trust Agreement, to
the fullest extent permitted by law, without first instituting any
legal proceeding against the Property Trustee or any other person
or entity.
ARTICLE SEVEN
Satisfaction and Discharge
SECTION 701. Defeasance.
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 deemed to have been
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 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, Government
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 on or prior to Maturity; provided, however, that
in the case of the provision for payment or redemption of less
than all the Securities of any series, such Securities or
portions thereof shall have been selected by the Trustee 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:
(x) if such deposit shall have been made prior to
the Maturity of such Securities, a Company Order stating
that the money and Government Obligations deposited in
accordance with this Section shall be held in trust, as
provided in Section 703; and
(y) if Government Obligations shall have been
deposited, an Opinion of Counsel that the obligations so
deposited constitute Government Obligations and do not
contain provisions permitting the redemption or other
prepayment 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 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 Government Obligations, or
both, in accordance with this Section, together with the
documents required by clauses (x), (y) and (z) above, the Trustee
shall, upon receipt of a Company Request, acknowledge in writing
that the Security or Securities or portions thereof with respect
to which such deposit was made 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) 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 benefits of this Indenture or of any
of the covenants of the Company under Article Six (except the
covenants contained in Sections 602 and 603) or any other
covenants made in respect of such Securities or portions thereof
as contemplated by Section 301, 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 the Holders of such
Securities or portions thereof shall continue to be entitled to
look to the Company for payment of the indebtedness represented
thereby; 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 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 403 for selection for
redemption of less than all the Securities of a series.
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 60
day period commencing with the date of the deposit of moneys or
Government Obligations, as aforesaid, the Company shall, as
promptly as practicable, give a 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 304, 305, 306, 404, 503 (as to notice
of redemption), 602, 603, 907 and 915 and this Article Seven
shall survive.
The Company shall pay, and shall indemnify the Trustee or
any Paying Agent with which Government Obligations shall have
been deposited as provided in this Section against, any tax, fee
or other charge imposed on or assessed against such Government
Obligations or the principal or interest received in respect of
such Government 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 or 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 Government 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 603.
SECTION 702. 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 proper
instruments acknowledging 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 701, 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.
Notwithstanding the satisfaction and discharge of this
Indenture as aforesaid, the obligations of the Company and the
Trustee under Sections 304, 305, 306, 404, 503 (as to notice of
redemption), 602, 603, 907 and 915 and this Article Seven shall
survive.
Upon satisfaction and discharge of this Indenture as pro-
vided in this Section, the Trustee shall assign, transfer and
turn over to the Company, subject to the lien provided by Section
907, any and all money, securities and other property then held
by the Trustee for the benefit of the Holders of the Securities
other than money and Government Obligations held by the Trustee
pursuant to Section 703.
SECTION 703. Application of Trust Money.
Neither the Government Obligations nor the money deposit-
ed pursuant to Section 701, nor the principal or interest
payments on any such Government 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 603; provided,
however, that, so long as there shall not have occurred and be
continuing an Event of Default any cash received from such
principal or interest payments on such Government Obligations, if
not then needed for such purpose, shall, to the extent prac-
ticable, be invested in Government Obligations of the type
described in clause (b) in the first paragraph of Section 701
maturing at such times and in such amounts as 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 on and prior to the Maturity thereof, and inter-
est earned from such reinvestment shall be paid over to the
Company as received, free and clear of any trust, lien or pledge
under this Indenture except the lien provided by Section 907; and
provided, further, that, so long as there shall not have occurred
and be continuing an Event of Default, 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
any trust, lien or pledge under this Indenture except the lien
provided by Section 907; 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
until such Event of Default shall have been waived or cured.
ARTICLE EIGHT
Events of Default; Remedies
SECTION 801. Events of Default.
"Event of Default", wherever used herein with respect to
Securities of any series, means any one of the following events:
(a) failure to pay interest, if any, including any
Additional Interest, on any Security of such series within 30
days after the same becomes due and payable (whether or not
payment is prohibited by the provisions of Article Fifteen
hereof); provided, however, that a valid extension of the
interest payment period by the Company as contemplated in
Section 311 of this Indenture shall not constitute a failure
to pay interest for this purpose; or
(b) failure to pay the principal of or premium, if any,
on any Security of such series at its Maturity (whether or not
payment is prohibited by the provisions of Article Fifteen
hereof); 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 or which has expressly been included in this
Indenture solely for the benefit of one or more series of
Securities other than such series) for a period of 60 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 33% in principal amount of
the Outstanding Securities of such series, a written notice
specifying such default or breach and requiring it to be
remedied and stating that such notice is a "Notice of Default"
hereunder, unless the Trustee, or the Trustee and the Holders
of a principal amount of Securities of such series 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 of such series,
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 (1) a decree or order for relief in respect of the
Company in an involuntary case or proceeding under any appli-
cable Federal or State bankruptcy, insolvency, reorganization
or other similar law or (2) 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 90 consecutive days; or
(e) the commencement by the Company of a voluntary case
or proceeding under any applicable Federal or State bank-
ruptcy, 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) any other Event of Default specified with respect to
Securities of such series.
SECTION 802. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default due to the default in payment of
principal of, or interest on, any series of Securities or due to
the default in the performance or breach of any other covenant or
warranty of the Company applicable to the Securities of such
series but not applicable to all outstanding Securities shall
have occurred and be continuing, either the Trustee or the
Holders of not less than 33% in principal amount of the
Securities of such series may then declare the principal of all
Securities of such series and interest accrued thereon to be due
and payable immediately (provided that the payment of principal
and interest on such Securities shall remain subordinated to the
extent provided in Article Fifteen hereof). If an Event of
Default due to default in the performance of any other of the
covenants or agreements herein applicable to all Outstanding
Securities or an Event of Default specified in Section 801(d) or
(e) shall have occurred and be continuing, either the Trustee or
the Holders of not less than 33% in principal amount of all
Securities then Outstanding (considered as one class), and not
the Holders of the Securities of any one of such series, may
declare the principal of all Securities and interest accrued
thereon to be due and payable immediately (provided that the
payment of principal and interest on such Securities shall remain
subordinated to the extent provided in the Indenture).
At any time after such a declaration of acceleration with
respect to Securities of any series shall have been made and
before a judgment or decree for payment of the money due shall
have been obtained by the Trustee as hereinafter in this Article
provided, the Event or Events of Default giving rise to such
declaration of acceleration shall, without further act, be deemed
to have been waived, 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
(1) all overdue interest on all Securities of such
series;
(2) the principal of and premium, if any, on any
Securities of such series which have become due otherwise
than by such declaration of acceleration and interest
thereon at the rate or rates prescribed therefor in such
Securities;
(3) to the extent that payment of such interest is
lawful, interest upon overdue interest, if any, at the
rate or rates prescribed therefor in such Securities;
(4) all amounts due to the Trustee under Section
907;
and
(b) any other Event or Events of Default with respect to
Securities of such series, other than the nonpayment of the
principal of Securities of such series which shall have become
due solely by such declaration of acceleration, shall have
been cured or waived as provided in Section 813.
No such rescission shall affect any subsequent Event of Default
or impair any right consequent thereon.
SECTION 803. Collection of Indebtedness and Suits for
Enforcement by Trustee.
If an Event of Default described in clause (a) or (b) of
Section 801 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 of the series with respect to which
such Event of Default shall have occurred, the whole amount then
due and payable on such Securities for principal and premium, if
any, and interest, if any, and, to the extent permitted by law,
interest on premium, if any, and on any overdue principal and in-
terest, at the rate or rates prescribed therefor in such
Securities, and, in addition thereto, such further amount as
shall be sufficient to cover any amounts due to the Trustee under
Section 907.
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.
If an Event of Default with respect to Securities of any
series shall have occurred and be continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the
rights of the Holders of Securities of such series by such
appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this
Indenture or in aid of the exercise of any power granted herein,
or to enforce any other proper remedy.
SECTION 804. 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 907) 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 907.
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 805. Trustee May Enforce Claims Without Possession of
Securities.
All rights of action and claims under this Indenture or
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 806. Application of Money Collected.
Subject to the provisions of Article Fifteen, any money
collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such money on account
of principal or premium, if any, or interest, if any, upon pre-
sentation of the Securities in respect of which or for the
benefit of which such money shall have been collected 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 907;
Second: To the payment of the amounts then due and un-
paid upon the Securities for principal of and premium, if any,
and interest, if any, in respect of which or for the benefit
of which such money has been collected, ratably, without
preference or priority of any kind, according to the amounts
due and payable on such Securities for principal, premium, if
any, and interest, if any, respectively; 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 807. Limitation on Suits.
No Holder shall have any right to institute any proceed-
ing, 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 with
respect to the Securities of such series;
(b) the Holders of not less than a majority in aggregate
principal amount of the Outstanding Securities of all series
in respect of which an Event of Default shall have occurred
and be continuing, considered as one class, 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 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 60-day period
by the Holders of a majority in aggregate principal amount of
the Outstanding Securities of all series in respect of which
an Event of Default shall have occurred and be continuing,
considered as one class;
it being understood and intended that no one or more of such
Holders shall have any right in any manner whatever by virtue of,
or by availing of, any provision of this Indenture to affect,
disturb or prejudice the rights of any other of such Holders or
to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this
Indenture, except in the manner herein provided and for the equal
and ratable benefit of all of such Holders.
SECTION 808. 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 307 and 311)
interest, if any, on such Security on the Stated Maturity or
Maturities expressed in such Security (or, in the case of redemp-
tion, 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 809. 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, and 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 810. Rights and Remedies Cumulative.
Except as otherwise provided in the last paragraph of
Section 306, no right or remedy herein conferred upon or reserved
to the Trustee or to the Holders is intended to be exclusive of
any other right or remedy, and every right and remedy shall, to
the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
SECTION 811. 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.
SECTION 812. Control by Holders of Securities.
If an Event of Default shall have occurred and be
continuing in respect of a series of Securities, the Holders of a
majority in principal amount of the Outstanding Securities of
such series shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred on the
Trustee, with respect to the Securities of such series; provided,
however, that if an Event of Default shall have occurred and be
continuing with respect to more than one series of Securities,
the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all such series, considered as one
class, shall have the right to make such direction, and not the
Holders of the Securities of any one of such series; and
provided, further, that such direction shall not be in conflict
with any rule of law or with this Indenture. Before proceeding
to exercise any right or power hereunder at the direction of such
Holders, the Trustee shall be entitled to receive from such
Holders reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in
compliance with any such direction.
SECTION 813. Waiver of Past Defaults.
The Holders of not less than a majority in principal
amount of the Outstanding Securities of any series may on behalf
of the Holders of all the Securities of such series waive any
past default hereunder with respect to such series 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 of such series, or
(b) in respect of a covenant or provision hereof which
under Section 1202 cannot be modified or amended without the
consent of the Holder of each Outstanding Security of such
series affected;
provided, however, that so long as a Trust holds the Securities
of any series, such Trust may not waive any past default without
the consent of at least a majority in aggregate liquidation
preference of the outstanding Preferred Securities issued by such
Trust affected, obtained as provided in the Trust Agreement
pertaining to such Trust.
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 814. Undertaking for Costs.
The Company and the Trustee agree, and each Holder by his
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 reason-
able 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
10% in aggregate principal amount of the Outstanding Securities
of all series in respect of which such suit may be brought,
considered as one class, 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
the Stated Maturity or Maturities expressed in such Security (or,
in the case of redemption, on or after the Redemption Date).
SECTION 815. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully
do so) that it will not at any time insist upon, or plead, or in
any manner whatsoever claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit
or advantage of any such law and covenants that it will not
hinder, delay or impede the execution of any power herein granted
to the Trustee, but will suffer and permit the execution of every
such power as though no such law had been enacted.
ARTICLE NINE
The Trustee
SECTION 901. Certain Duties and Responsibilities.
(a) The Trustee shall have and be subject to all the
duties and responsibilities specified with respect to an
indenture trustee in the Trust Indenture Act and no implied
covenants or obligations shall be read into this Indenture
against the Trustee.
(b) 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.
(c) Notwithstanding anything contained in this Indenture
to the contrary, the duties and responsibilities of the
Trustee under this Indenture shall be subject to the
protections, exculpations and limitations on liability
afforded to the Trustee under the provisions of the Trust
Indenture Act.
(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 902. Notice of Defaults.
The Trustee shall give notice of any default hereunder
with respect to the Securities of any series to the Holders of
Securities of such series 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 801(c),
no such notice to Holders shall be given until at least 45 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.
SECTION 903. Certain Rights of Trustee.
Subject to the provisions of Section 901 and to the
applicable provisions of the Trust Indenture Act:
(a) the Trustee may rely and shall be protected in
acting or refraining from acting in good faith 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 reasonably believed by it to be genuine and to
have been signed or presented by the proper party or parties;
(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 be herein
specifically prescribed) may, in the absence of bad faith on
its part, rely upon an Officer's Certificate;
(d) the Trustee may consult with counsel and the written
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;
and
(h) the Trustee shall not be charged with knowledge of
any default or Event of Default, as the case may be, with
respect to the Securities of any series for which it is acting
as Trustee unless either (1) a Responsible Officer of the
Trustee shall have actual knowledge of the default or Event of
Default, as the case may be, or (2) written notice of such
default or Event of Default, as the case may be, shall have
been given to the Trustee by the Company, any other obligor on
such Securities or by any Holder of such Securities.
SECTION 904. Not Responsible for Recitals or Issuance of
Securities.
The recitals contained herein and in the Securities (ex-
cept the Trustee's certificates of authentication) shall be taken
as the statements of the Company, and neither the Trustee nor any
Authenticating Agent assumes responsibility for their correct-
ness. The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Securities. Neither the
Trustee nor any Authenticating Agent shall be accountable for the
use or application by the Company of Securities or the proceeds
thereof.
SECTION 905. May Hold Securities.
Each of the Trustee, any Authenticating Agent, any Paying
Agent, any Security Registrar or any other agent of the Company,
in its individual or any other capacity, may become the owner or
pledgee of Securities and, subject to Sections 908 and 913, may
otherwise deal with the Company with the same rights it would
have if it were not the Trustee, Authenticating Agent, Paying
Agent, Security Registrar or such other agent.
SECTION 906. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be
segregated from other funds, except to the extent required by
law. The Trustee shall be under no liability for interest on any
money received by it hereunder except as expressly provided
herein or otherwise agreed with, and for the sole benefit of, the
Company.
SECTION 907. 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 reasonably 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 the Trustee's negligence, wilful
misconduct or bad faith; and
(c) indemnify the Trustee for, and hold it harmless from
and against, any loss, liability or expense reasonably
incurred by it arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder
or the performance of its duties hereunder, including the
reasonable 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, except
to the extent any such loss, liability or expense may be
attributable to its negligence, wilful misconduct or bad
faith.
As security for the performance of the obligations of the
Company under this Section, the Trustee shall have a lien prior
to the Securities upon all property and funds held or collected
by the Trustee as such other than property and funds held in
trust under Section 703 (except as otherwise provided in Section
703). "Trustee" for purposes of this Section shall include any
predecessor Trustee; provided, however, that the negligence,
wilful misconduct or bad faith of any Trustee hereunder shall not
affect the rights of any other Trustee hereunder.
In addition to the rights provided to the Trustee pursuant
to the provisions of the immediately preceding paraghraph of this
Section 907, when the Trustee incurs expenses or renders services
in connection with an Event of Default specified in Section 801(d)
or Section 801(e), 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.
SECTION 908. 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
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. The Trust Agreement and the Guarantee
Agreement pertaining to each Trust shall be deemed to be
specifically described in this Indenture for the purposes of
clause (i) of the first proviso contained in Section 310(b) of
the Trust Indenture Act.
SECTION 909. 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 $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 $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 910. 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 911.
(b) The Trustee may resign at any time with respect to
the Securities of one or more series by giving written notice
thereof to the Company. If the instrument of acceptance by a
successor Trustee required by Section 911 shall not have been
delivered to the Trustee within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition
any court of competent jurisdiction for the appointment of a
successor Trustee with respect to the Securities of such
series.
(c) The Trustee may be removed at any time with respect
to the Securities of any series by Act of the Holders of a
majority in principal amount of the Outstanding Securities of
such series delivered to the Trustee and to the Company;
provided that so long as any Preferred Securities remain
outstanding, the Trust which issued such Preferred Securities
shall not execute any Act to remove the Trustee without the
consent of the holders of a majority in aggregate liquidation
preference of Preferred Securities issued by such Trust
outstanding, obtained as provided in the Trust Agreement
pertaining to such Trust.
(d) If at any time:
(1) the Trustee shall fail to comply with Section
908 after written request therefor by the Company or by
any Holder who has been a bona fide Holder for at least
six months, or
(2) the Trustee shall cease to be eligible under
Section 909 and shall fail to resign after written re-
quest therefor by the Company or by any such Holder, or
(3) the Trustee shall become incapable of acting or
shall be adjudged a bankrupt or insolvent or a receiver
of the Trustee or of its property shall be appointed or
any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (x) the Company by a Board Resolution may
remove the Trustee with respect to all Securities or (y) subject
to Section 814, any Holder who has been a bona fide Holder for at
least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction
for the removal of the Trustee with respect to all Securities 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), with respect to the
Securities of one or more series, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee or
Trustees with respect to the Securities of that or those
series (it being understood that any such successor Trustee
may be appointed with respect to the Securities of one or more
or all of such series and that at any time there shall be only
one Trustee with respect to the Securities of any particular
series) and shall comply with the applicable requirements of
Section 911. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Securities of any series
shall be appointed by Act of the Holders of a majority in
principal amount of the Outstanding Securities of such series
delivered to the Company and the retiring Trustee, the succes-
sor Trustee so appointed shall, forthwith upon its acceptance
of such appointment in accordance with the applicable
requirements of Section 911, become the successor Trustee with
respect to the Securities of such series and to that extent
supersede the successor Trustee appointed by the Company. If
no successor Trustee with respect to the Securities of any
series shall have been so appointed by the Company or the
Holders and accepted appointment in the manner required by
Section 911, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf
of itself and all others similarly situated, petition any
court of competent jurisdiction for the appointment of a
successor Trustee with respect to the Securities of such
series.
(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, and except with respect
to a Trustee appointed by Act of the Holders of a majority in
principal amount of the Outstanding Securities pursuant to
subsection (e) of this Section, 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 911, 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 by the Company pursuant to subsection (e) of this
Section and such appointment shall be deemed to have been
accepted as contemplated in Section 911, all as of such date,
and all other provisions of this Section and Section 911 shall
be applicable to such resignation, appointment and acceptance
except to the extent inconsistent with this subsection (f).
(g) The Company shall give notice of each resignation
and each removal of the Trustee with respect to the Securities
of any series and each appointment of a successor Trustee with
respect to the Securities of any series by mailing written
notice of such event by first-class mail, postage prepaid, to
all Holders of Securities of such series as their names and
addresses appear in the Security Register. Each notice shall
include the name of the successor Trustee with respect to the
Securities of such series and the address of its corporate
trust office.
SECTION 911. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor
Trustee with respect to the Securities of all series, 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.
(b) In case of the appointment hereunder of a successor
Trustee with respect to the Securities of one or more (but not
all) series, the Company, the retiring Trustee and each
successor Trustee with respect to the Securities of one or
more series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall
accept such appointment and which (1) shall contain such
provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Trustee all the
rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series to which the
appointment of such successor Trustee relates, (2) if the
retiring Trustee is not retiring with respect to all
Securities, shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers,
trusts and duties of the retiring Trustee with respect to the
Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the
retiring Trustee and (3) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide
for or facilitate the administration of the trusts hereunder
by more than one Trustee, it being understood that nothing
herein or in such supplemental indenture shall constitute such
Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder
separate and apart from any trust or trusts hereunder
administered by any other such Trustee; and upon the execution
and delivery of such supplemental indenture the resignation or
removal of the retiring Trustee shall become effective to the
extent provided therein and each such successor Trustee,
without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or
those series to which the appointment of such successor
Trustee relates; but, on request of the Company or any succes-
sor Trustee, such retiring Trustee, upon payment of all sums
owed to it, shall duly assign, transfer and deliver to such
successor Trustee all property and money held by such retiring
Trustee hereunder with respect to the Securities of that or
those series to which the appointment of such successor
Trustee relates.
(c) Upon request of any such successor Trustee, the
Company shall execute any instruments which fully vest in and
confirm to such successor Trustee all such rights, powers and
trusts referred to in subsection (a) or (b) of this Section,
as the case may be.
(d) 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 912. 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 913. 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 311(b) of the Trust Indenture Act:
(a) the term "cash transaction" means any transaction in
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;
(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 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 arising from the making, drawing, negotiating
or incurring of the draft, bill of exchange, acceptance or
obligation.
SECTION 914. Co-trustees and Separate Trustees.
At any time or times, for the purpose of meeting the
legal requirements of any applicable jurisdiction, 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 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 either to act as co-trustee, jointly with the
Trustee, or to act as separate trustee, 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 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;
(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) no co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the
Trustee, or any other such 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 915. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents
with respect to the Securities of one or more series, which shall
be authorized to act on behalf of the Trustee to authenticate
Securities of such series issued upon original issuance and upon
exchange, registration of transfer or partial redemption thereof
or pursuant to Section 306, 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,
authorized under such laws to act as Authenticating Agent, having
a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by Federal or State
authority. If such Authenticating Agent publishes reports of
condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then for
the purposes of this Section, the combined capital and surplus of
such Authenticating Agent shall be deemed to be its combined
capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent
shall cease to be eligible in accordance with the provisions of
this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or
consolidation to which such Authenticating Agent shall be a
party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation
shall be otherwise eligible under this Section, without the
execution or filing of any paper or any further act on the part
of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving
written notice thereof to the Trustee and to the Company. The
Trustee may at any time terminate the agency of an Authenticating
Agent by giving written notice thereof to such Authenticating
Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time
such Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, the Trustee may
appoint a successor Authenticating Agent which shall be
acceptable to the Company. 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 Trustee agrees to pay to each Authenticating Agent
from time to time reasonable compensation for its services under
this Section, and the Trustee shall be entitled to be reimbursed
for such payments, in accordance with, and subject to the
provisions of Section 907.
The provisions of Sections 308, 904 and 905 shall be ap-
plicable to each Authenticating Agent.
If an appointment with respect to the Securities of one
or more series shall be made pursuant to this Section, the
Securities of such series may have endorsed thereon, in addition
to the Trustee's certificate of authentication, an alternate
certificate of authentication substantially in the following
form:
This is one of the Securities of the series designated
therein referred to in the within-mentioned Indenture.
________________________
As Trustee
By______________________
As Authenticating
Agent
By______________________
Authorized Signatory
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 102 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 TEN
Holders' Lists and Reports by Trustee and Company
SECTION 1001. Lists of Holders.
Semiannually, not later than June 1 and December 1 in
each year, commencing June 1, 1996, 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, 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 1002. Reports by Trustee and Company.
Not later than November 1 in each year, commencing
November 1, 1996, the Trustee shall transmit to the Holders and
the Commission a report, dated as of the next preceding September
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 and the Commission, and the Company
shall file with the Trustee (within 30 days after filing with the
Commission in the case of reports 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.
ARTICLE ELEVEN
Consolidation, Merger, Conveyance or Other Transfer
SECTION 1101. 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 its
properties and assets 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 transfer, or which leases, the properties and
assets of the Company substantially as an entirety shall be a
Person organized and validly existing under the laws of the
United States, any State thereof or the District of Columbia,
and shall expressly assume, by an indenture supplemental
hereto, executed and delivered to the Trustee, in form sat-
isfactory to the Trustee, the due and punctual payment of the
principal of and premium, if any, and interest, if any, on all
Outstanding Securities and the performance of every covenant
of this Indenture on the part of the Company to be per-
formed or observed;
(b) immediately after giving effect to such transaction
no Event of Default, and no event which, after notice or lapse
of time or both, would become an Event of Default, shall have
occurred and be continuing; and
(c) the Company shall have delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel, each stating
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 transactions have been complied with.
SECTION 1102. Successor Corporation Substituted.
Upon any consolidation by the Company with or merger by
the Company into any other corporation or any conveyance, or
other transfer or lease of the properties and assets of the
Company substantially as an entirety in accordance with Section
1101, the successor corporation formed by such consolidation or
into which the Company is merged or the Person to which such
conveyance, transfer or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, the
Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein, and
thereafter, except in the case of a lease, the predecessor Person
shall be relieved of all obligations and covenants under this
Indenture and the Securities Outstanding hereunder.
ARTICLE TWELVE
Supplemental Indentures
SECTION 1201. 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 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 Eleven; 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 to surrender any right or power herein
conferred upon the Company; or
(c) to add any additional Events of Default with respect
to all or any series of Securities Outstanding hereunder; or
(d) to change or eliminate any provision of this Inden-
ture 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 Outstanding on the date of such indenture
supplemental hereto in any material respect, such change,
elimination or addition shall become effective with respect to
such series only pursuant to the provisions of Section 1202
hereof or when no Security of such series remains Outstanding;
or
(e) to provide collateral security for all but not part
of the Securities; or
(f) to establish the form or terms of Securities of any
series as contemplated by Sections 201 and 301; or
(g) 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
(h) to evidence and provide for the acceptance of
appointment hereunder by a separate or successor Trustee with
respect to the Securities of one or more series and to add to
or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of
the trusts hereunder by more than one Trustee, pursuant to the
requirements of Section 911(b); or
(i) to provide for the procedures required to permit the
Company to utilize, at its option, a noncertificated system of
registration for all, or any series of, the Securities; or
(j) 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 shall be payable, (2) all or any
series of Securities may be surrendered for registration of
transfer, (3) all or any series of Securities may be
surrendered for exchange and (4) notices and demands to or
upon the Company in respect of all or any series of Securities
and this Indenture may be served; or
(k) 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 changes to
the provisions hereof or to add other provisions with respect
to matters or questions arising under this Indenture, provided
that such other changes or additions shall not adversely
affect the interests of the Holders of Securities of any
series in any material respect.
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 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
effect or evidence such changes or additional provisions;
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, 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 any Holders, enter into an
indenture supplemental hereto to evidence such amendment
hereof.
SECTION 1202. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of not less than a major-
ity 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, when authorized by a Board Resolution, and the
Trustee may enter into an indenture or indentures supplemental
hereto for the purpose of adding any provisions to, or changing
in any manner or eliminating any of the provisions of, this
Indenture or modifying in any manner the rights of the Holders of
Securities of such series under the 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 no such supplemental indenture shall:
(a) change the Stated Maturity of the principal of, or
any installment of principal of or interest on (except as
provided in Section 311 hereof), 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 upon the redemption thereof, or change the coin or
currency (or other property), in which any Security or any
premium or the interest thereon is payable, or impair the
right to institute suit for the enforcement of any such
payment on or after the Stated Maturity of any Security (or,
in the case of redemption, on or after the Redemption Date),
without, in any such case, the consent of the Holder of such
Security, or
(b) reduce the percentage in principal amount of the
Outstanding Securities of any series (or, if applicable, in
liquidation preference of any series of Preferred Securities),
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 conse-
quences, or reduce the requirements of Section 1304 for quorum
or voting, without, in any such case, the consent of the
Holders of each Outstanding Security of such series, or
(c) modify any of the provisions of this Section,
Section 607 or Section 813 with respect to the Securities of
any series, 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 Holder of each
Outstanding Security affected thereby; provided, however, that
this clause shall not be deemed to require the consent of any
Holder with respect to changes in the references to "the
Trustee" and concomitant changes in this Section, or the
deletion of this proviso, in accordance with the requirements
of Sections 911(b) and 1201(h).
Notwithstanding the foregoing, so long as any of the Preferred
Securities remain outstanding, the Trustee may not consent to a
supplemental indenture under this Section 1202 without the prior
consent, obtained as provided in a Trust Agreement pertaining to
a Trust which issued such Preferred Securities, of the holders of
not less than a majority in aggregate liquidation preference of
all Preferred Securities issued by such Trust affected,
considered as one class, or, in the case of changes described in
clauses (a), (b) and (c) above, 100% in aggregate liquidation
preference of all such Preferred Securities then outstanding
which would be affected thereby, considered as one class. A
supplemental indenture which changes or eliminates any covenant
or other provision of this Indenture which has expressly been
included solely for the benefit of one or more particular series
of Securities, or which modifies the rights of the Holders of
Securities of such series with respect to such covenant or other
provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders under
this Section to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such Act
shall approve the substance thereof. A waiver by a Holder of
such Holder's right to consent under this Section shall be deemed
to be a consent of such Holder.
SECTION 1203. 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
901) 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 1204. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under
this Article, this Indenture shall be modified in accordance
therewith, and such supplemental indenture shall form a part of
this Indenture for all purposes; and every Holder of 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
shallsupersedethisIndenture astheretoforeineffectfor allpurposes.
SECTION 1205. Conformity With Trust Indenture Act.
Every supplemental indenture executed pursuant to this
Article shall conform to the requirements of the Trust Indenture
Act as then in effect.
SECTION 1206. Reference in Securities to Supplemental
Indentures.
Securities of any series authenticated and delivered
after the execution of any supplemental indenture pursuant to
this Article may, and shall if required by the Trustee, bear a
notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company
shall so determine, new Securities of any series so modified as
to conform, in the opinion of the Trustee and the Company, to any
such supplemental indenture may be prepared and executed by the
Company and authenticated and delivered by the Trustee in
exchange for Outstanding Securities of such series.
SECTION 1207. Modification Without Supplemental Indenture.
If the terms of any particular series of Securities shall
have been established in a Board Resolution or an Officer's
Certificate as contemplated by Section 301, and not in an
indenture supplemental hereto, additions to, changes in or the
elimination of any of such terms may be effected by means of a
supplemental Board Resolution or Officer's Certificate, as the
case may be, delivered to, and accepted by, the Trustee;
provided, however, that such supplemental Board Resolution or
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 Officer's Certificate shall be deemed to be a
"supplemental indenture" for purposes of Section 1204 and 1206.
ARTICLE THIRTEEN
Meetings of Holders; Action Without Meeting
SECTION 1301. Purposes for Which Meetings May Be Called.
A meeting of Holders of Securities of one or more, or
all, series 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.
SECTION 1302. 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 for any
purpose specified in Section 1301, to be held at such time and
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 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
106, not less than 21 nor more than 180 days prior to the date
fixed for the meeting.
(b) If the Trustee shall have been requested to call a
meeting of the Holders of Securities of one or more, or all,
series by the Company or by the Holders of 33% in aggregate
principal amount of all of such series, considered as one
class, for any purpose specified in Section 1301, by written
request setting forth in reasonable detail the action proposed
to be taken at the meeting, and the Trustee shall not have
given the notice of such meeting within 21 days after receipt
of such request or shall not thereafter proceed to cause the
meeting to be held as provided herein, then the Company or the
Holders of Securities of such series in the amount above
specified, as the case may be, 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 shall be valid without notice if the Holders of
all Outstanding Securities of such series 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 by such of them as are not
present at the meeting in person or by proxy, and by the
Company and the Trustee.
SECTION 1303. 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 a Person shall be (a) a
Holder of one or more Outstanding Securities of such series, 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 by such Holder or Holders. The only Persons who shall be
entitled to attend any meeting of Holders of Securities of any
series 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 1304. Quorum; Action.
The Persons entitled to vote a majority in aggregate
principal amount of the Outstanding Securities of the series 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; provided,
however, that if any 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,
considered as one class, the Persons entitled to vote such
specified percentage in principal amount of the Outstanding Secu-
rities of such series, 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, 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 1305(e), notice
of the reconvening of any meeting adjourned for more than 30 days
shall be given as provided in Section 1302(a) not less than 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
which shall constitute a quorum.
Except as limited by Section 1202, any resolution pre-
sented 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 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, 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,
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
with respect to which such meeting shall have been held, whether
or not present or represented at the meeting.
SECTION 1305. 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 of such Securities before being voted.
(b) Notwithstanding any other provisions of this Inden-
ture, 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 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, the holding of
Securities shall be proved in the manner specified in Section
104 and the appointment of any proxy shall be proved in the
manner specified in Section 104. Such regulations may provide
that written instruments appointing proxies, regular on their
face, may be presumed valid and genuine without the proof
specified in Section 104 or other proof.
(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 1302(b), in which case the Company or the
Holders of Securities of the series 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 represented at the meet-
ing, considered as one class.
(d) At any meeting each Holder or proxy shall be
entitled to one vote for each $1 principal amount of
Securities held or represented by him; 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 1302 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 represented
at the meeting, considered as one class; and the meeting may
be held as so adjourned without further notice.
SECTION 1306. 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 with respect to which the
meeting shall have been called, held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of
votes who shall count all votes cast at the meeting for or
against any resolution and who shall make and file with the
secretary of the meeting their verified written reports of all
votes cast at the meeting. A record of the proceedings of each
meeting of Holders shall be prepared by the secretary of the
meeting and there shall be attached to said record the original
reports of the inspectors of votes on any vote by ballot taken
thereat and affidavits by one or more persons having knowledge of
the facts setting forth a copy of the notice of the meeting and
showing that said notice was given as provided in Section 1302
and, if applicable, Section 1304. 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 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 1307. 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 written instruments as provided in
Section 104.
ARTICLE FOURTEEN
Immunity of Incorporators, Stockholders, Officers and Directors
SECTION 1401. 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 that any
such personal liability is hereby expressly waived and released
as a condition of, and as part of the consideration for, the
execution of this Indenture and the issuance of the Securities.
ARTICLE FIFTEEN
Subordination of Securities
SECTION 1501. Securities Subordinate to Senior Indebtedness.
The Company, for itself, its successors and assigns,
covenants and agrees, and each Holder of the Securities of each
series, by its acceptance thereof, likewise covenants and agrees,
that the payment of the principal of and premium, if any, and
interest, if any, on each and all of the Securities is hereby
expressly subordinated and subject to the extent and in the
manner set forth in this Article, in right of payment to the
prior payment in full of all Senior Indebtedness.
Each Holder of the Securities of each series, by its
acceptance thereof, authorizes and directs the Trustee on its
behalf to take such action as may be necessary or appropriate to
effectuate the subordination as provided in this Article, and
appoints the Trustee its attorney-in-fact for any and all such
purposes.
SECTION 1502. Payment Over of Proceeds of Securities.
In the event (a) of any insolvency or bankruptcy
proceedings or any receivership, liquidation, reorganization or
other similar proceedings in respect of the Company or a
substantial part of its property, or of any proceedings for
liquidation, dissolution or other winding up of the Company,
whether or not involving insolvency or bankruptcy, or (b) subject
to the provisions of Section 1503, that (i) a default shall have
occurred with respect to the payment of principal of or interest
on or other monetary amounts due and payable on any Senior
Indebtedness, or (ii) there shall have occurred a default (other
than a default in the payment of principal or interest or other
monetary amounts due and payable) in respect of any Senior
Indebtedness, as defined therein or in the instrument under which
the same is outstanding, permitting the holder or holders thereof
to accelerate the maturity thereof (with notice or lapse of time,
or both), and such default shall have continued beyond the period
of grace, if any, in respect thereof, and, in the cases of
subclauses (i) and (ii) of this clause (b), such default shall
not have been cured or waived or shall not have ceased to exist,
or (c) that the principal of and accrued interest on the
Securities of any series shall have been declared due and payable
pursuant to Section 801 and such declaration shall not have been
rescinded and annulled as provided in Section 802, then:
(1) the holders of all Senior Indebtedness
shall first be entitled to receive payment of the
full amount due thereon, or provision shall be made
for such payment in money or money's worth, before
the Holders of any of the Securities are entitled to
receive a payment on account of the principal of or
interest on the indebtedness evidenced by the
Securities, including, without limitation, any
payments made pursuant to Articles Four and Five;
(2) any payment by, or distribution of assets
of, the Company of any kind or character, whether in
cash, property or securities, to which any Holder or
the Trustee would be entitled except for the
provisions of this Article, shall be paid or
delivered by the person making such payment or
distribution, whether a trustee in bankruptcy, a
receiver or liquidating trustee or otherwise,
directly to the holders of such Senior Indebtedness
or their representative or representatives or to the
trustee or trustees under any indenture under which
any instruments evidencing any of such Senior
Indebtedness may have been issued, ratably according
to the aggregate amounts remaining unpaid on account
of such Senior Indebtedness held or represented by
each, to the extent necessary to make payment in
full of all Senior Indebtedness remaining unpaid
after giving effect to any concurrent payment or
distribution (or provision therefor) to the holders
of such Senior Indebtedness, before any payment or
distribution is made to the Holders of the
indebtedness evidenced by the Securities or to the
Trustee under this Indenture; and
(3) in the event that, notwithstanding the
foregoing, any payment by, or distribution of assets
of, the Company of any kind or character, whether in
cash, property or securities, in respect of
principal of or interest on the Securities or in
connection with any repurchase by the Company of the
Securities, shall be received by the Trustee or any
Holder before all Senior Indebtedness is paid in
full, or provision is made for such payment in money
or money's worth, such payment or distribution in
respect of principal of or interest on the
Securities or in connection with any repurchase by
the Company of the Securities shall be paid over to
the holders of such Senior Indebtedness or their
representative or representatives or to the trustee
or trustees under any indenture under which any
instruments evidencing any such Senior Indebtedness
may have been issued, ratably as aforesaid, for
application to the payment of all Senior
Indebtedness remaining unpaid until all such Senior
Indebtedness shall have been paid in full, after
giving effect to any concurrent payment or
distribution (or provision therefor) to the holders
of such Senior Indebtedness.
Notwithstanding the foregoing, at any time after the
123rd day following the date of deposit of cash or Government
Obligations pursuant to Section 701 (provided all conditions set
out in such Section shall have been satisfied), the funds so
deposited and any interest thereon will not be subject to any
rights of holders of Senior Indebtedness including, without
limitation, those arising under this Article Fifteen; provided
that no event described in clauses (d) and (e) of Section 801
with respect to the Company has occurred during such 123-day
period.
For purposes of this Article only, the words "cash,
property or securities" shall not be deemed to include shares of
stock of the Company as reorganized or readjusted, or securities
of the Company or any other corporation provided for by a plan or
reorganization or readjustment which are subordinate in right of
payment to all Senior Indebtedness which may at the time be
outstanding to the same extent as, or to a greater extent than,
the Securities are so subordinated as provided in this Article.
The consolidation of the Company with, or the merger of the
Company into, another corporation or the liquidation or
dissolution of the Company following the conveyance or transfer
of its property as an entirety, or substantially as an entirety,
to another corporation upon the terms and conditions provided for
in Article Eleven hereof shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of
this Section 1502 if such other corporation shall, as a part of
such consolidation, merger, conveyance or transfer, comply with
the conditions stated in Article Eleven hereof. Nothing in
Section 1501 or in this Section 1502 shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 907.
SECTION 1503. Disputes with Holders of Certain Senior
Indebtedness.
Any failure by the Company to make any payment on or
perform any other obligation in respect of Senior Indebtedness,
other than any indebtedness incurred by the Company or assumed or
guaranteed, directly or indirectly, by the Company for money
borrowed (or any deferral, renewal, extension or refunding
thereof) or any other obligation as to which the provisions of
this Section shall have been waived by the Company in the
instrument or instruments by which the Company incurred, assumed,
guaranteed or otherwise created such indebtedness or obligation,
shall not be deemed a default under clause (b) of Section 1502 if
(i) the Company shall be disputing its obligation to make such
payment or perform such obligation and (ii) either (A) no final
judgment relating to such dispute shall have been issued against
the Company which is in full force and effect and is not subject
to further review, including a judgment that has become final by
reason of the expiration of the time within which a party may
seek further appeal or review, or (B) in the event that a
judgment that is subject to further review or appeal has been
issued, the Company shall in good faith be prosecuting an appeal
or other proceeding for review and a stay or execution shall have
been obtained pending such appeal or review.
SECTION 1504. Subrogation.
Senior Indebtedness shall not be deemed to have been paid
in full unless the holders thereof shall have received cash (or
securities or other property satisfactory to such holders) in
full payment of such Senior Indebtedness then outstanding.
Subject to the prior payment in full of all Senior Indebtedness,
the rights of the Holders of the Securities shall be subrogated
to the rights of the holders of Senior Indebtedness to receive
any further payments or distributions of cash, property or
securities of the Company applicable to the holders of the Senior
Indebtedness until all amounts owing on the Securities shall be
paid in full; and such payments or distributions of cash,
property or securities received by the Holders of the Securities,
by reason of such subrogation, which otherwise would be paid or
distributed to the holders of such Senior Indebtedness shall, as
between the Company, its creditors other than the holders of
Senior Indebtedness, and the Holders, be deemed to be a payment
by the Company to or on account of Senior Indebtedness, it being
understood that the provisions of this Article are and are
intended solely for the purpose of defining the relative rights
of the Holders, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.
SECTION 1505. Obligation of the Company Unconditional.
Nothing contained in this Article or elsewhere in this
Indenture or in the Securities is intended to or shall impair, as
among the Company, its creditors other than the holders of Senior
Indebtedness and the Holders, the obligation of the Company,
which is absolute and unconditional, to pay to the Holders the
principal of and interest on the Securities as and when the same
shall become due and payable in accordance with their terms, or
is intended to or shall affect the relative rights of the Holders
and creditors of the Company other than the holders of Senior
Indebtedness, nor shall anything herein or therein prevent the
Trustee or any Holder from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture,
subject to the rights, if any, under this Article of the holders
of Senior Indebtedness in respect of cash, property or securities
of the Company received upon the exercise of any such remedy.
Upon any payment or distribution of assets or securities
of the Company referred to in this Article, the Trustee and the
Holders shall be entitled to rely upon any order or decree of a
court of competent jurisdiction in which such dissolution,
winding up, liquidation or reorganization proceedings are pending
for the purpose of ascertaining the persons entitled to
participate in such distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount
thereof or payable thereon, the amount or amounts paid or
distributed thereon, and all other facts pertinent thereto or to
this Article.
SECTION 1506. Priority of Senior Indebtedness Upon Maturity.
Upon the maturity of the principal of any Senior
Indebtedness by lapse of time, acceleration or otherwise, all
matured principal of Senior Indebtedness and interest and
premium, if any, thereon shall first be paid in full before any
payment of principal or premium, if any, or interest, if any, is
made upon the Securities or before any Securities can be acquired
by the Company or any sinking fund payment is made with respect
to the Securities (except that required sinking fund payments may
be reduced by Securities acquired before such maturity of such
Senior Indebtedness).
SECTION 1507. Trustee as Holder of Senior Indebtedness.
The Trustee shall be entitled to all rights set forth in
this Article with respect to any Senior Indebtedness at any time
held by it, to the same extent as any other holder of Senior
Indebtedness. Nothing in this Article shall deprive the Trustee
of any of its rights as such holder.
SECTION 1508. Notice to Trustee to Effectuate Subordination.
Notwithstanding the provisions of this Article or any
other provision of the Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts which would
prohibit the making of any payment of moneys to or by the Trustee
unless and until the Trustee shall have received written notice
thereof from the Company, from a Holder or from a holder of any
Senior Indebtedness or from any representative or representatives
of such holder and, prior to the receipt of any such written
notice, the Trustee shall be entitled, subject to Section 901, in
all respects to assume that no such facts exist; provided,
however, that, if prior to the fifth Business Day preceding the
date upon which by the terms hereof any such moneys may become
payable for any purpose, or in the event of the execution of an
instrument pursuant to Section 702 acknowledging satisfaction and
discharge of this Indenture, then if prior to the second Business
Day preceding the date of such execution, the Trustee shall not
have received with respect to such moneys the notice provided for
in this Section, then, anything herein contained to the contrary
notwithstanding, the Trustee may, in its discretion, receive such
moneys and/or apply the same to the purpose for which they were
received, and shall not be affected by any notice to the
contrary, which may be received by it on or after such date;
provided, however, that no such application shall affect the
obligations under this Article of the persons receiving such
moneys from the Trustee.
SECTION 1509. Modification, Extension, etc. of Senior
Indebtedness.
The holders of Senior Indebtedness may, without affecting
in any manner the subordination of the payment of the principal
of and premium, if any, and interest, if any, on the Securities,
at any time or from time to time and in their absolute
discretion, agree with the Company to change the manner, place or
terms of payment, change or extend the time of payment of, or
renew or alter, any Senior Indebtedness, or amend or supplement
any instrument pursuant to which any Senior Indebtedness is
issued, or exercise or refrain from exercising any other of their
rights under the Senior Indebtedness including, without
limitation, the waiver of default thereunder, all without notice
to or assent from the Holders or the Trustee.
SECTION 1510. Trustee Has No Fiduciary Duty to Holders of Senior
Indebtedness.
With respect to the holders of Senior Indebtedness, the
Trustee undertakes to perform or to observe only such of its
covenants and objectives as are specifically set forth in this
Indenture, and no implied covenants or obligations with respect
to the holders of Senior Indebtedness shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed
to owe any fiduciary duty to the holders of Senior Indebtedness,
and shall not be liable to any such holders if it shall
mistakenly pay over or deliver to the Holders or the Company or
any other Person, money or assets to which any holders of Senior
Indebtedness shall be entitled by virtue of this Article or
otherwise.
SECTION 1511. Paying Agents Other Than the Trustee.
In case at any time any Paying Agent other than the
Trustee shall have been appointed by the Company and be then
acting hereunder, the term "Trustee" as used in this Article
shall in such case (unless the context shall otherwise require)
be construed as extending to and including such Paying Agent
within its meaning as fully for all intents and purposes as if
such Paying Agent were named in this Article in addition to or in
place of the Trustee; provided, however, that Sections 1507, 1508
and 1510 shall not apply to the Company if it acts as Paying
Agent.
SECTION 1512. Rights of Holders of Senior Indebtedness Not
Impaired.
No right of any present or future holder of Senior
Indebtedness to enforce the subordination herein shall at any
time or in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or by any noncompliance
by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof any such holder
may have or be otherwise charged with.
SECTION 1513. Effect of Subordination Provisions; Termination.
Notwithstanding anything contained herein to the
contrary, other than as provided in the immediately succeeding
sentence, all the provisions of this Indenture shall be subject
to the provisions of this Article, so far as the same may be
applicable thereto.
Notwithstanding anything contained herein to the
contrary, the provisions of this Article Fifteen shall be of no
further effect, and the Securities shall no longer be
subordinated in right of payment to the prior payment of Senior
Indebtedness, if the Company shall have delivered to the Trustee
a notice to such effect. Any such notice delivered by the
Company shall not be deemed to be a supplemental indenture for
purposes of Article Twelve.
_________________________
This instrument may be executed in any number of counter-
parts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but
one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, all as of the day and year first
above written.
MINNESOTA POWER & LIGHT COMPANY
By:________________________________
THE BANK OF NEW YORK, Trustee
By:_________________________________
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the th day of , 1996, before me personally
came , to me known, who, being by me duly sworn,
did depose and say that she is the of Minnesota Power
& Light Company, one of the corporations described in and which
executed the foregoing instrument; that she knows the seal of
said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the
Board of Directors of said corporation, and that she signed her
name thereto by like authority.
________________________________
Notary Public, State of New York
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the th day of , 1996, before me personally
came , to me known, who, being by me duly sworn,
did depose and say that he is a of The Bank of
New York, one of the corporations described in and which executed
the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such
corporate seal; that it was so affixed by authority of the Board
of Directors of said corporation, and that he signed his name
thereto by like authority.
_________________________________
Notary Public, State of New York
Exhibit 4(d)
GUARANTEE AGREEMENT
Between
Minnesota Power & Light Company
(as Guarantor)
and
The Bank of New York
(as Trustee)
dated as of
, 1996
TABLE OF CONTENTS
-----------------
Page
----
ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . 1
SECTION 1.01 Definitions. . . . . . . . . . . . . . 1
ARTICLE II TRUST INDENTURE ACT . . . . . . . . . . . . 4
SECTION 2.01 Trust Indenture Act; Application . . . 4
SECTION 2.02 Lists of Holders of Preferred
Securities . . . . . . . . . . . . . 4
SECTION 2.03 Reports by the Guarantee Trustee . . . 4
SECTION 2.04 Periodic Reports to Guarantee Trustee. 4
SECTION 2.05 Evidence of Compliance with
Conditions Precedent . . . . . . . . 5
SECTION 2.06 Events of Default; Waiver. . . . . . . 5
SECTION 2.07 Event of Default; Notice . . . . . . . 5
SECTION 2.08 Conflicting Interests. . . . . . . . . 5
ARTICLE III POWERS, DUTIES AND RIGHTS OF GUARANTEE
TRUSTEE . . . . . . . . . . . . . . . . . 5
SECTION 3.01 Powers and Duties of the Guarantee
Trustee. . . . . . . . . . . . . . . 5
SECTION 3.02 Certain Rights of Guarantee Trustee. . 7
ARTICLE IV GUARANTEE TRUSTEE . . . . . . . . . . . . . 9
SECTION 4.01 Guarantee Trustee; Eligibility . . . . 9
SECTION 4.02 Compensation and Reimbursement . . . . 9
SECTION 4.03 Appointment, Removal and Resignation
of Guarantee Trustee . . . . . . . . 10
ARTICLE V GUARANTEE . . . . . . . . . . . . . . . . . 11
SECTION 5.01 Guarantee. . . . . . . . . . . . . . . 11
SECTION 5.02 Waiver of Notice and Demand. . . . . . 11
SECTION 5.03 Obligations Not Affected . . . . . . . 12
SECTION 5.04 Rights of Holders. . . . . . . . . . . 12
SECTION 5.05 Guarantee of Payment . . . . . . . . . 13
SECTION 5.06 Subrogation. . . . . . . . . . . . . . 13
SECTION 5.07 Independent Obligations. . . . . . . . 13
ARTICLE VI SUBORDINATION . . . . . . . . . . . . . . . 13
SECTION 6.01 Subordination. . . . . . . . . . . . . 13
ARTICLE VII TERMINATION . . . . . . . . . . . . . . . . 14
SECTION 7.01 Termination. . . . . . . . . . . . . . 14
ARTICLE VIII MISCELLANEOUS . . . . . . . . . . . . . . . 14
SECTION 8.01 Successors and Assigns . . . . . . . . 14
SECTION 8.02 Amendments . . . . . . . . . . . . . . 14
SECTION 8.03 Notices. . . . . . . . . . . . . . . . 14
SECTION 8.04 Benefit. . . . . . . . . . . . . . . . 15
SECTION 8.05 Interpretation . . . . . . . . . . . . 16
SECTION 8.06 Governing Law. . . . . . . . . . . . . 16
CROSS-REFERENCE TABLE
---------------------
Section of Section of
Trust Indenture Act Guarantee
of 1939, as amended Agreement
------------------- ----------
310(a) . . . . . . . . . . . . . . . . . 4.01(a)
310(b) . . . . . . . . . . . . . . . . . 4.01(c), 2.08
310(c) . . . . . . . . . . . . . . . . . Inapplicable
311(a) . . . . . . . . . . . . . . . . . 2.02(b)
311(b) . . . . . . . . . . . . . . . . . 2.02(b)
311(c) . . . . . . . . . . . . . . . . . Inapplicable
312(a) . . . . . . . . . . . . . . . . . 2.02(a)
312(b) . . . . . . . . . . . . . . . . . 2.02(b)
313. . . . . . . . . . . . . . . . . . 2.03
314(a) . . . . . . . . . . . . . . . . . 2.04
314(b) . . . . . . . . . . . . . . . . . Inapplicable
314(c) . . . . . . . . . . . . . . . . . 2.05
314(d) . . . . . . . . . . . . . . . . . Inapplicable
314(e) . . . . . . . . . . . . . . . . . 1.01, 2.05, 3.02
314(f) . . . . . . . . . . . . . . . . . 2.01, 3.02
315(a) . . . . . . . . . . . . . . . . . 3.01(d)
315(b) . . . . . . . . . . . . . . . . . 2.07
315(c) . . . . . . . . . . . . . . . . . 3.01
315(d) . . . . . . . . . . . . . . . . . 3.01(d)
316(a) . . . . . . . . . . . . . . . . . 5.04(a), 2.06
316(b) . . . . . . . . . . . . . . . . . 5.03
316(c) . . . . . . . . . . . . . . . . . 2.02
317(a) . . . . . . . . . . . . . . . . . Inapplicable
317(b) . . . . . . . . . . . . . . . . . Inapplicable
318(a) . . . . . . . . . . . . . . . . . 2.01(b)
318(b) . . . . . . . . . . . . . . . . . 2.01
318(c) . . . . . . . . . . . . . . . . . 2.01(a)
_____________
* This Cross-Reference Table does not constitute part of the
Guarantee Agreement and shall not affect the interpretation
of any of its terms or provisions.
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT ("Guarantee Agreement"), dated
as of , 1996, is executed and delivered by Minnesota
Power & Light Company, a Minnesota corporation (the "Guarantor"),
and The Bank of New York, as trustee (the "Guarantee Trustee"),
for the benefit of the Holders (as defined herein) from time to
time of the Preferred Securities (as defined herein) of MP&L
Capital I, a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Trust
Agreement (the "Trust Agreement"), dated as of , 1996
between the Trustees of the Issuer named therein, Minnesota Power
& Light Company, as Depositor, and the several Holders (as
defined therein) the Issuer is issuing as of the date hereof $
aggregate liquidation amount of its % Cumulative
Quarterly Income Preferred Securities (the "Preferred
Securities") representing preferred undivided beneficial
ownership interests in the Issuer and having the terms set forth
in the Trust Agreement;
WHEREAS, the Preferred Securities are to be issued for
sale by the Issuer and the proceeds are to be invested in $
principal amount of Debentures (as defined in the Trust
Agreement); and
WHEREAS, in order to enhance the value of the Preferred
Securities, the Guarantor desires to irrevocably and
unconditionally agree, to the extent set forth herein, to pay to
the Holders the Guarantee Payments (as defined herein) and to
make certain other payments on the terms and conditions set forth
herein;
NOW, THEREFORE, in consideration of the purchase of
Debentures, which purchase the Guarantor hereby agrees shall
benefit the Guarantor, the Guarantor executes and delivers this
Guarantee Agreement for the benefit of the Holders from time to
time.
ARTICLE I
DEFINITIONS
SECTION 1.01 Definitions. As used in this Guarantee
Agreement, the terms set forth below shall, unless the context
otherwise requires, have the following meanings. Capitalized or
otherwise defined terms used but not otherwise defined herein
shall have the meanings assigned to such terms in the Trust
Agreement as in effect on the date hereof.
"Affiliate" of any specified Person means any other
Person directly or indirectly controlling or controlled by or
under direct or indirect common control with such specified
Person. For the purposes of this definition, "control" when used
with respect to any specified Person means the power to direct
the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities,
by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the
foregoing.
"Common Securities" means the securities representing
common undivided beneficial interests in the assets of the
Issuer.
"Event of Default" means a default by the Guarantor on
any of its payment obligations under this Guarantee Agreement.
"Guarantee Payments" shall mean the following payments
or distributions, without duplication, with respect to the
Preferred Securities, to the extent not paid or made by or on
behalf of the Issuer: (i) any accrued and unpaid Distributions
that are required to be paid on such Preferred Securities but
only if and to the extent that the Property Trustee has available
in the Payment Account funds sufficient to make such payment,
(ii) the redemption price (the "Redemption Price"), and all
accrued and unpaid Distributions to the date of redemption, with
respect to the Preferred Securities called for redemption by the
Issuer but only if and to the extent that the Property Trustee
has available in the Payment Account funds sufficient to make
such payment, (iii) upon a voluntary or involuntary dissolution,
winding-up or termination of the Issuer (other than in connection
with a redemption of all of the Preferred Securities), the lesser
of (a) the aggregate of the Liquidation Amount and all accrued
and unpaid Distributions on the Preferred Securities to the date
of payment, and (b) the amount of assets of the Issuer remaining
available for distribution to Holders in liquidation of the
Issuer (in either case, the "Liquidation Distribution").
"Guarantee Trustee" means The Bank of New York until a
Successor Guarantee Trustee has been appointed and has accepted
such appointment pursuant to the terms of this Guarantee
Agreement and thereafter means each such Successor Guarantee
Trustee.
"Holder" shall mean any holder, as registered on the
books and records of the Issuer, of any Preferred Securities then
outstanding; provided, however, that in determining whether the
holders of the requisite percentage of Preferred Securities have
given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guarantor or any Affiliate of the
Guarantor.
"Indenture" means the Indenture dated as of
, 1996, among the Guarantor (the "Debenture Issuer") and The
Bank of New York, as trustee, pursuant to which the Debentures
are issued.
"Majority in liquidation amount of the Preferred
Securities" means a vote by Holders, voting separately as a
class, of more than 50% of the aggregate liquidation amount of
all Preferred Securities.
"Officers' Certificate" means a certificate signed by
the Chairman of the Board, a Vice Chairman of the Board, the
President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary, of the
Guarantor, and delivered to the Guarantee Trustee. Any Officers'
Certificate delivered with respect to compliance with a condition
or covenant provided for in this Guarantee Agreement shall
include:
(a) a statement that each officer signing the
Officers' Certificate has read the covenant or condition and
the definitions relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in
rendering the Officers' Certificate;
(c) a statement that each such officer has made such
examination or investigation as, in such officer's opinion,
is necessary to enable such officer 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 officer, such condition or covenant has been complied
with.
"Person" means any individual, corporation,
partnership, joint venture, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Responsible Officer" means, with respect to the
Guarantee Trustee, any vice-president, any assistant vice-
president, the secretary, any assistant secretary, the treasurer,
any assistant treasurer, any trust officer or assistant trust
officer or any other officer of the Corporate Trust Department of
the Guarantee Trustee customarily performing functions similar to
those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any
other officer to whom such matter is referred because of that
officer's knowledge of and familiarity with the particular
subject.
"Successor Guarantee Trustee" means a successor
Guarantee Trustee possessing the qualifications to act as
Guarantee Trustee under Section 4.01.
"Trust Indenture Act" means the Trust Indenture Act of
1939, as amended.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.01 Trust Indenture Act; Application.
(a) This Guarantee Agreement is subject to the
provisions of the Trust Indenture Act that are required or deemed
to be part of this Guarantee Agreement and shall, to the extent
applicable, be governed by such provisions; and
(b) if and to the extent that any provision of this
Guarantee Agreement limits, qualifies or conflicts with the
duties imposed by Sections 310 to 317, inclusive, of the Trust
Indenture Act, such imposed duties shall control.
SECTION 2.02 Lists of Holders of Preferred
Securities.
(a) The Guarantor shall furnish or cause to be
furnished to the Guarantee Trustee (a) semiannually, not later
than December 31 and June 30 in each year, a list, in such form
as the Guarantee Trustee may reasonably require, of the names and
addresses of the Holders ("List of Holders") as of a date not
more than 15 days prior to the delivery thereof, and (b) at such
other times as the Guarantee Trustee may request in writing,
within 30 days after the receipt by the Guarantor of any such
request, a List of Holders as of a date not more than 15 days
prior to the time such list is furnished; provided that, the
Guarantor shall not be obligated to provide such List of Holders
at any time the List of Holders does not differ from the most
recent List of Holders given to the Guarantee Trustee by the
Guarantor. The Guarantee Trustee may destroy any List of Holders
previously given to it on receipt of a new List of Holders.
(b) The Guarantee Trustee shall comply with its
obligations under Section 311(a) of the Trust Indenture Act,
subject to the provisions of Section 311(b) and Section 312(b) of
the Trust Indenture Act.
SECTION 2.03 Reports by the Guarantee Trustee.
Within 60 days after December 31 of each year, commencing
December 31, 1996, the Guarantee Trustee shall provide to the
Holders such reports, if any, as are required by Section 313(a)
of the Trust Indenture Act in the form and in the manner provided
by Section 313(a) of the Trust Indenture Act. The Guarantee
Trustee shall also comply with the requirements of Sections
313(b), (c) and (d) of the Trust Indenture Act.
SECTION 2.04 Periodic Reports to Guarantee Trustee.
The Guarantor shall provide to the Guarantee Trustee such
documents, reports and information as required by Section 314 (if
any) and the compliance certificate required by Section 314 of
the Trust Indenture Act in the form, in the manner and at the
times required by Section 314 of the Trust Indenture Act.
SECTION 2.05 Evidence of Compliance with Conditions
Precedent. The Guarantor shall provide to the Guarantee Trustee
such evidence of compliance with any conditions precedent
provided for in this Guarantee Agreement as and to the extent
required by Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer
pursuant to Section 314(c)(1) of the Trust Indenture Act may be
given in the form of an Officers' Certificate.
SECTION 2.06 Events of Default; Waiver. The Holders
of a Majority in liquidation amount of Preferred Securities may,
by vote, on behalf of all of the Holders, waive any past Event of
Default and its consequences. Upon such waiver, any such Event
of Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured, for every purpose
of this Guarantee Agreement, but no such waiver shall extend to
any subsequent or other default or Event of Default or impair any
right consequent thereon.
SECTION 2.07 Event of Default; Notice.
(a) The Guarantee Trustee shall, within 90 days after
the occurrence of an Event of Default, transmit by mail, first
class postage prepaid, to the Holders, notices of all Events of
Default known to the Guarantee Trustee, unless such defaults have
been cured before the giving of such notice, provided that, the
Guarantee Trustee shall be protected in withholding such notice
if and so long as the board of directors, the executive
committee, or a trust committee of directors or Responsible
Officers of the Guarantee Trustee in good faith determines that
the withholding of such notice is in the interests of the
Holders.
(b) The Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default unless the Guarantee Trustee
shall have received written notice, or a Responsible Officer
charged with the administration of the Trust Agreement shall have
obtained written notice, of such Event of Default.
SECTION 2.08 Conflicting Interests. The Trust
Agreement and the Indenture shall be deemed to be specifically
described in this Guarantee Agreement for the purposes of clause
(i) of the first proviso contained in Section 310(b) of the Trust
Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE
SECTION 3.01 Powers and Duties of the Guarantee
Trustee.
(a) This Guarantee Agreement shall be held by the
Guarantee Trustee for the benefit of the Holders, and the
Guarantee Trustee shall not transfer this Guarantee Agreement or
any rights hereunder to any Person except a Holder exercising his
or her rights pursuant to Section 5.04 or to a Successor
Guarantee Trustee on acceptance by such Successor Guarantee
Trustee of its appointment to act as Successor Guarantee Trustee.
The right, title and interest of the Guarantee Trustee shall
automatically vest in any Successor Guarantee Trustee, and such
vesting and cessation of title shall be effective whether or not
conveyancing documents have been executed and delivered pursuant
to the appointment of such Successor Guarantee Trustee.
(b) The Guarantee Trustee, prior to the occurrence of
any Event of Default and after the curing of all Events of
Default that may have occurred, shall undertake to perform only
such duties as are specifically set forth in this Guarantee
Agreement, and no implied covenants or obligations shall be read
into this Guarantee Agreement against the Guarantee Trustee. In
case an Event of Default has occurred (that has not been cured or
waived pursuant to Section 2.06), the Guarantee Trustee shall
exercise such of the rights and powers vested in it by this
Guarantee Agreement, and use the same degree of care and skill in
its exercise thereof, as a prudent person would exercise or use
under the circumstances in the conduct of his or her own affairs.
(c) No provision of this Guarantee Agreement shall be
construed to relieve the Guarantee Trustee from liability for its
own negligent action, its own negligent failure to act, or its
own willful misconduct, except that:
(i) prior to the occurrence of any Event of
Default and after the curing or waiving of all such
Events of Default that may have occurred:
(A) the duties and obligations of the
Guarantee Trustee shall be determined solely by
the express provisions of this Guarantee
Agreement, and the Guarantee Trustee shall not be
liable except for the performance of such duties
and obligations as are specifically set forth in
this Guarantee Agreement; and
(B) in the absence of bad faith on the part
of the Guarantee Trustee, the Guarantee Trustee
may conclusively rely, as to the truth of the
statements and the correctness of the opinions
expressed therein, upon any certificates or
opinions furnished to the Guarantee Trustee and
conforming to the requirements of this Guarantee
Agreement; but in the case of any such
certificates or opinions that by any provision
hereof are specifically required to be furnished
to the Guarantee Trustee, the Guarantee Trustee
shall be under a duty to examine the same to
determine whether or not they conform to the
requirements of this Guarantee Agreement;
(ii) the Guarantee Trustee shall not be liable
for any error of judgment made in good faith by a
Responsible Officer of the Guarantee Trustee, unless it
shall be proved that the Guarantee Trustee or such
Responsible Officer was negligent in ascertaining the
pertinent facts upon which such judgment was made;
(iii) the Guarantee 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 liquidation amount of the
Preferred Securities relating to the time, method and
place of conducting any proceeding for any remedy
available to the Guarantee Trustee, or exercising any
trust or power conferred upon the Guarantee Trustee
under this Guarantee Agreement; and
(iv) no provision of this Guarantee Agreement
shall require the Guarantee Trustee to expend or risk
its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in
the exercise of any of its rights or powers, if the
Guarantee Trustee shall have reasonable grounds for
believing that the repayment of such funds or liability
is not reasonably assured to it under the terms of this
Guarantee Agreement or adequate indemnity against such
risk or liability is not reasonably assured to it.
SECTION 3.02 Certain Rights of Guarantee Trustee.
(a) Subject to the provisions of Section 3.01:
(i) the Guarantee Trustee may 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
reasonably believed by it to be genuine and to have
been signed, sent or presented by the proper party or
parties;
(ii) any direction or act of the Guarantor
contemplated by this Guarantee Agreement shall be
sufficiently evidenced by an Officers' Certificate;
(iii) whenever, in the administration of this
Guarantee Agreement, the Guarantee Trustee shall deem
it desirable that a matter be proved or established
before taking, suffering or omitting any action
hereunder, the Guarantee Trustee (unless other evidence
is herein specifically prescribed) may, in the absence
of bad faith on its part, request and rely upon an
Officers' Certificate which, upon receipt of such
request, shall be promptly delivered by the Guarantor;
(iv) the Guarantee Trustee may consult with
counsel of its choice, and the written advice or
opinion of such counsel with respect to legal matters
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 accordance with such
advice or opinion; such counsel may be counsel to the
Guarantor or any of its Affiliates and may include any
of its employees; the Guarantee Trustee shall have the
right at any time to seek instructions concerning the
administration of this Guarantee Agreement from any
court of competent jurisdiction;
(v) the Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers
vested in it by this Guarantee Agreement at the request
or direction of any Holder, unless such Holder shall
have provided to the Guarantee Trustee such adequate
security and indemnity as would satisfy a reasonable
person in the position of the Guarantee Trustee,
against the costs, expenses (including attorneys' fees
and expenses) and liabilities that might be incurred by
it in complying with such request or direction,
including such reasonable advances as may be requested
by the Guarantee Trustee; provided that, nothing
contained in this Section 3.02(a)(v) shall be taken to
relieve the Guarantee Trustee, upon the occurrence of
an Event of Default, of its obligation to exercise the
rights and powers vested in it by this Guarantee
Agreement;
(vi) the Guarantee 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 reasonably
believed by it to be genuine, but the Guarantee
Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as
it may see fit;
(vii) the Guarantee 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 Guarantee 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;
(viii) whenever in the administration of this
Guarantee Agreement the Guarantee Trustee shall deem it
desirable to receive instructions with respect to
enforcing any remedy or right or taking any other
action hereunder, the Guarantee Trustee (1) may request
instructions from the Holders, (2) may refrain from
enforcing such remedy or right or taking such other
action until such instructions are received, and (3)
shall be protected in acting in accordance with such
instructions; and
(ix) the Guarantee 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 Guarantee.
(b) No provision of this Guarantee Agreement shall be
deemed to impose any duty or obligation on the Guarantee Trustee
to perform any act or acts or exercise any right, power, duty or
obligation conferred or imposed on it in any jurisdiction in
which it shall be illegal, or in which the Guarantee Trustee
shall be unqualified or incompetent in accordance with applicable
law, to perform any such act or acts or to exercise any such
right, power, duty or obligation. No permissive power or
authority available to the Guarantee Trustee shall be construed
to be a duty.
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 4.01 Guarantee Trustee; Eligibility.
(a) There shall at all times be a Guarantee Trustee
which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing
business under the laws of the United States of America
or any State or Territory thereof or of the District of
Columbia, or a corporation or Person permitted by the
Securities and Exchange Commission to act as an
institutional trustee under the Trust Indenture Act,
authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at
least 50 million U.S. dollars ($50,000,000), and
subject to supervision or examination by Federal,
State, Territorial or District of Columbia authority.
If such corporation publishes reports of condition at
least annually, pursuant to law or to the requirements
of the supervising or examining authority referred to
above, then, for the purposes of this Section
4.01(a)(ii), 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.
(b) If at any time the Guarantee Trustee shall cease
to be eligible to so act under Section 4.01(a), the Guarantee
Trustee shall immediately resign in the manner and with the
effect set out in Section 4.03(c).
(c) If the Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of
the Trust Indenture Act, the Guarantee Trustee and Guarantor
shall in all respects comply with the provisions of Section
310(b) of the Trust Indenture Act.
SECTION 4.02 Compensation and Reimbursement.
The Guarantor agrees:
(a) to pay the Guarantee Trustee from time to time
such reasonable compensation as the Guarantor and the Guarantee
Trustee shall from time to time agree in writing 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, to
reimburse the Guarantee Trustee upon its request for all
reasonable expenses, disbursements and advances incurred or made
by the Guarantee Trustee in accordance with the provisions of
this Guarantee (including the reasonable compensation and
expenses of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence
or bad faith; and
(c) to indemnify each of the Guarantee Trustee and any
predecessor Guarantee Trustee for, and to hold it harmless from
and against, any and all loss, damage, claim, liability or
expense, including taxes (other than taxes based upon the income
of the Guarantee Trustee) incurred without negligence or bad
faith on its part, arising out of or in connection with the
acceptance of the administration of this Guarantee Agreement,
including the costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance
of any its powers or duties hereunder.
As security for the performance of the obligations of
the Guarantor under this Section, the Guarantee Trustee shall
have a lien prior to the Preferred Securities upon all the
property and funds held or collected by the Guarantee Trustee as
such, except funds held in trust for the payment of principal of,
and premium (if any) or interest on, particular obligations of
the Guarantor under this Guarantee Agreement.
The provisions of this Section shall survive the
termination of this Guarantee Agreement.
SECTION 4.03 Appointment, Removal and Resignation of
Guarantee Trustee.
(a) Subject to Section 4.03(b), unless an Event of
Default shall have occurred and be continuing, the Guarantee
Trustee may be appointed or removed without cause at any time by
the Guarantor.
(b) The Guarantee Trustee shall not be removed until a
Successor Guarantee Trustee has been appointed and has accepted
such appointment by written instrument executed by such Successor
Guarantee Trustee and delivered to the Guarantor.
(c) The Guarantee Trustee appointed to office shall
hold office until a Successor Guarantee Trustee shall have been
appointed or until its removal or resignation. The Guarantee
Trustee may resign from office (without need for prior or
subsequent accounting) by an instrument in writing executed by
the Guarantee Trustee and delivered to the Guarantor, which
resignation shall not take effect until a Successor Guarantee
Trustee has been appointed and has accepted such appointment by
instrument in writing executed by such Successor Guarantee
Trustee and delivered to the Guarantor and the resigning
Guarantee Trustee.
(d) If no Successor Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section
4.03 within 60 days after delivery to the Guarantor of an
instrument of resignation, the resigning Guarantee Trustee may
petition any court of competent jurisdiction for appointment of a
Successor Guarantee Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a
Successor Guarantee Trustee.
(e) The Guarantor shall give notice of each
resignation and each removal of the Guarantee Trustee and each
appointment of a successor Guarantee Trustee to all Holders in
the manner provided in Section 8.03 hereof. Each notice shall
include the name of the successor Guarantee Trustee and the
address of its Corporate Trust Office.
ARTICLE V
GUARANTEE
SECTION 5.01 Guarantee. The Guarantor irrevocably
and unconditionally agrees to pay in full to the Holders the
Guarantee Payments (without duplication of amounts theretofore
paid by the Issuer), as and when due, regardless of any defense,
right of set-off or counterclaim which the Issuer may have or
assert. The Guarantor's obligation to make a Guarantee Payment
may be satisfied by direct payment of the required amounts by the
Guarantor to the Holders or by causing the Issuer to pay such
amounts to the Holders.
SECTION 5.02 Waiver of Notice and Demand. The
Guarantor hereby waives notice of acceptance of this Guarantee
Agreement and of any liability to which it applies or may apply,
presentment, demand for payment, any right to require a
proceeding first against the Issuer or any other Person before
proceeding against the Guarantor, protest, notice of nonpayment,
notice of dishonor, notice of redemption and all other notices
and demands.
SECTION 5.03 Obligations Not Affected. The
obligation of the Guarantor to make the Guarantee Payments under
this Guarantee Agreement shall in no way be affected or impaired
by reason of the happening from time to time of any of the
following:
(a) the release or waiver, by operation of law or
otherwise, of the performance or observance by the Issuer of
any express or implied agreement, covenant, term or
condition relating to the Preferred Securities to be
performed or observed by the Issuer;
(b) the extension of time for the payment by the
Issuer of all or any portion of the Distributions,
Redemption Price, Liquidation Distribution or any other sums
payable under the terms of the Preferred Securities or the
extension of time for the performance of any other
obligation under, arising out of, or in connection with, the
Preferred Securities (other than an extension of time for
payment of Distributions, Redemption Price, Liquidation
Distribution or other sum payable that results from the
extension of any interest payment period on the Debentures
permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence
on the part of the Holders to enforce, assert or exercise
any right, privilege, power or remedy conferred on the
Holders pursuant to the terms of the Preferred Securities,
or any action on the part of the Issuer granting indulgence
or extension of any kind;
(d) the voluntary or involuntary liquidation,
dissolution, sale of any collateral, receivership,
insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or
readjustment of debt of, or other similar proceedings
affecting, the Issuer or any of the assets of the Issuer;
(e) any invalidity of, or defect or deficiency in, the
Preferred Securities;
(f) the settlement or compromise of any obligation
guaranteed hereby or hereby incurred; or
(g) any other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or
defense of a guarantor, it being the intent of this Section
5.03 that the obligations of the Guarantor hereunder shall
be absolute and unconditional under any and all
circumstances.
There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of
any of the foregoing.
SECTION 5.04 Rights of Holders. The Guarantor
expressly acknowledges that: (i) this Guarantee Agreement will be
deposited with the Guarantee Trustee to be held for the benefit
of the Holders; (ii) the Guarantee Trustee has the right to
enforce this Guarantee Agreement on behalf of the Holders; (iii)
the Holders of a Majority in liquidation amount of the Preferred
Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the
Guarantee Trustee in respect of this Guarantee Agreement or
exercising any trust or power conferred upon the Guarantee
Trustee under this Guarantee Agreement; and (iv) any Holder may
institute a legal proceeding directly against the Guarantor to
enforce its rights under this Guarantee Agreement without first
instituting a legal proceeding against the Issuer or any other
person or entity.
SECTION 5.05 Guarantee of Payment. This Guarantee
Agreement creates a guarantee of payment and not of collection.
This Guarantee Agreement will not be discharged except by payment
of the Guarantee Payments in full (without duplication).
SECTION 5.06 Subrogation. The Guarantor shall be
subrogated to all (if any) rights of the Holders against the
Issuer in respect of any amounts paid to the Holders by the
Guarantor under this Guarantee Agreement; provided, however, that
the Guarantor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise
any rights which it may acquire by way of subrogation or any
indemnity, reimbursement or other agreement, in all cases as a
result of payment under this Guarantee Agreement, if, at the time
of any such payment, any amounts of Guarantee Payments are due
and unpaid under this Guarantee Agreement. If any amount shall
be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders
and to pay over such amount to the Holders.
SECTION 5.07 Independent Obligations. The Guarantor
acknowledges that its obligations hereunder are independent of
the obligations of the Issuer with respect to the Preferred
Securities and that the Guarantor shall be liable as principal
and as debtor hereunder to make Guarantee Payments pursuant to
the terms of this Guarantee Agreement notwithstanding the
occurrence of any event referred to in subsections (a) through
(g), inclusive, of Section 5.03.
ARTICLE VI
SUBORDINATION
SECTION 6.01 Subordination. This Guarantee Agreement
will constitute an unsecured obligation of the Guarantor and will
rank (i) subordinate and junior in right of payment to all other
liabilities of the Guarantor, including the Debentures, except
those made pari passu or subordinate by their terms, (ii) pari
passu with the most senior preferred or preference stock now or
hereafter issued by the Guarantor and with any guarantee now or
hereafter entered into by the Guarantor in respect of any
preferred or preference stock of any Affiliate of the Guarantor,
and (iii) senior to all common stock of the Guarantor. Nothing
in this Section 6.01 shall apply to claims of, or payments to,
the Guarantee Trustee under or pursuant to Section 4.02 hereof.
ARTICLE VII
TERMINATION
SECTION 7.01 Termination. This Guarantee Agreement
shall terminate and be of no further force and effect upon: (i)
full payment of the Redemption Price of all Preferred Securities,
and all accrued and unpaid Distributions to the date of
redemption, (ii) the distribution of Debentures to Holders in
exchange for all of the Preferred Securities or (iii) full
payment of the amounts payable in accordance with the Trust
Agreement upon liquidation of the Issuer. Notwithstanding the
foregoing, this Guarantee Agreement will continue to be effective
or will be reinstated, as the case may be, if at any time any
Holder must restore payment of any sums paid with respect to the
Preferred Securities or under this Guarantee Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01 Successors and Assigns. All guarantees
and agreements contained in this Guarantee Agreement shall bind
the successors, assigns, receivers, trustees and representatives
of the Guarantor and shall inure to the benefit of the Holders of
the Preferred Securities then outstanding. Except in connection
with a consolidation, merger or sale involving the Guarantor that
is permitted under Article Eleven of the Indenture, the Guarantor
shall not assign its obligations hereunder.
SECTION 8.02 Amendments. This Guarantee Agreement
may be amended only by an instrument in writing entered into by
the Guarantor and the Guarantee Trustee. Except with respect to
any changes which do not materially adversely affect the rights
of Holders (in which case no consent of Holders will be
required), this Guarantee Agreement may only be amended with the
prior approval of the Holders of not less than 66 2/3% in
aggregate liquidation amount of all the outstanding Preferred
Securities. The provisions of Article VI of the Trust Agreement
concerning meetings of Holders shall apply to the giving of such
approval. Nothing herein contained shall be deemed to require
that the Guarantee Trustee enter into any amendment of this
Guarantee Agreement.
SECTION 8.03 Notices. Any notice, request or other
communication required or permitted to be given hereunder shall
be in writing, duly signed by the party giving such notice, and
delivered, telecopied or mailed by first class mail as follows:
(a) if given to the Guarantor, to the address set
forth below or such other address as the Guarantor may give
notice of to the Holders of the Preferred Securities:
Minnesota Power & Light Company
30 West Superior Street
Duluth, Minnesota 55802
Facsimile No: (218) 723-3912
Attention: James K. Vizanko
(b) if given to the Issuer, in care of the
Administrative Trustees, at the Issuer's (and the
Administrative Trustee's) address set forth below or such
other address as the Administrative Trustees on behalf of
the Issuer may give notice of to the Holders:
MP&L Capital I
c/o Minnesota Power & Light Company
30 West Superior Street
Duluth, Minnesota 55802
Facsimile No: (218) 723-3912
Attention: Administrative Trustees
(c) if given to the Guarantee Trustee, to the address
set forth below or such other address as the Guarantee
Trustee may give notice of to the Holders of the Preferred
Securities:
The Bank of New York
101 Barclay Street, 21 West
New York, New York 10286
Facsimile No: (212) 815-5915
Attention: Corporate Trust Administration
(d) if given to any Holder, at the address set forth
on the books and records of the Issuer.
All notices hereunder shall be deemed to have been
given when received in person, telecopied with receipt confirmed,
or mailed by first class mail, postage prepaid except that if a
notice or other document is refused delivery or cannot be
delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been
delivered on the date of such refusal or inability to deliver.
SECTION 8.04 Benefit. This Guarantee Agreement is
solely for the benefit of the Holders and, subject to Section
3.01(a), is not separately transferable from the Preferred
Securities.
SECTION 8.05 Interpretation. In this Guarantee
Agreement, unless the context otherwise requires:
(a) Capitalized terms used in this Guarantee Agreement
but not defined in the preamble hereto have the respective
meanings assigned to them in Section 1.01;
(b) a term defined anywhere in this Guarantee
Agreement has the same meaning throughout;
(c) all references to "the Guarantee Agreement" or
"this Guarantee Agreement" are to this Guarantee Agreement
as modified, supplemented or amended from time to time;
(d) all references in this Guarantee Agreement to
Articles and Sections are to Articles and Sections of this
Guarantee Agreement unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the
same meaning when used in this Guarantee Agreement unless
otherwise defined in this Guarantee Agreement or unless the
context otherwise requires;
(f) a reference to the singular includes the plural
and vice versa; and
(g) the masculine, feminine or neuter genders used
herein shall include the masculine, feminine and neuter
genders.
SECTION 8.06 Governing Law. This Guarantee Agreement
shall be governed by and construed and interpreted in accordance
with the laws of the State of New York.
This instrument may be executed in any number of
counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but
one and the same instrument.
THIS GUARANTEE AGREEMENT is executed as of the day and year
first above written.
Minnesota Power & Light Company
By: ______________________________
Name:
Title:
The Bank of New York,
as Guarantee Trustee
By: ______________________________
Name:
Title:
Exhibit 4(f)
MINNESOTA POWER & LIGHT COMPANY
OFFICER'S CERTIFICATE
James K. Vizanko, the Treasurer of Minnesota Power & Light
Company (the "Company"), pursuant to the authority granted in the
Board Resolutions of the Company dated 1996, and
Sections 201 and 301 of the Indenture defined herein, does hereby
certify to The Bank of New York (the "Trustee"), as Trustee under
the Indenture of the Company (For Unsecured Subordinated Debt
Securities relating to Trust Securities) dated as of ,
1996 (the "Indenture") that:
1. The securities of the first series to be issued under
the Indenture shall be designated " % Junior
Subordinated Debentures, Series , due
" (the "Debentures of the First Series").
The Debentures of the First Series are to be issued to
MP&L Capital I, a Delaware statutory business trust
(the "Trust"). All capitalized terms used in this
certificate which are not defined herein but are
defined in the Indenture shall have the meanings set
forth in the Indenture;
2. The Debentures of the First Series shall be limited in
aggregate principal amount to $ at
any time Outstanding, except as contemplated in Section
301(b) of the Indenture;
3. The Debentures of the First Series shall mature and the
principal shall be due and payable together with all
accrued and unpaid interest thereon on;
4. The Debentures of the First Series shall bear interest
from, and including, the date of original issuance, at
the rate of % per annum payable quarterly in
arrears on March 31, June 30, September 30 and December
31 of each year (each, an "Interest Payment Date")
commencing , 1996. The amount of interest
payable for any such period will be computed on the
basis of a 360-day year of twelve 30-day months and for
any period shorter than a full month, on the basis of
the actual number of days elapsed in such period.
Interest on the Debentures of the First Series will
accrue from, and including, the date of original
issuance and will accrue to, and including, the first
Interest Payment Date, and thereafter will accrue from,
and excluding, the last Interest Payment Date through
which interest has been paid or duly provided for. In
the event that any Interest Payment Date is not a
Business Day, then payment of interest payable on such
date will be made on the next succeeding day which is a
Business Day (and without any interest or other payment
in respect of such delay), except that, if such
Business Day is in the next succeeding calendar year,
such payment shall be made on the immediately preceding
Business Day, in each case with the same force and
effect as if made on such Interest Payment Date;
5. Each installment of interest on a Debenture of the
First Series shall be payable to the Person in whose
name such Debenture of the First Series is registered
at the close of business on the Business Day 15 days
preceding the corresponding Interest Payment Date (the
"Regular Record Date") for the Debentures of the First
Series; provided, however, that if the Debentures of
the First Series are held neither by the Trust nor by a
securities depositary, the Company shall have the right
to change the Regular Record Date by one or more
Officer's Certificates. Any installment of interest on
the Debentures of the First Series not punctually paid
or duly provided for shall forthwith cease to be
payable to the Holders of such Debentures of the First
Series on such Regular Record Date, and may be paid to
the Persons in whose name the Debentures of the First
Series are registered at the close of business on a
Special Record Date to be fixed by the Trustee for the
payment of such Defaulted Interest. Notice of such
Defaulted Interest and Special Record Date shall be
given to the Holders of the Debentures of the First
Series not less than 10 days prior to such Special
Record Date, or may be paid at any time in any other
lawful manner not inconsistent with the requirements of
any securities exchange on which the Debentures of the
First Series may be listed, and upon such notice as may
be required by such exchange, all as more fully
provided in the Indenture;
6. The principal and each installment of interest on the
Debentures of the First Series shall be payable at, and
registration and registration of transfers and
exchanges in respect of the Debentures of the First
Series may be effected at, the office or agency of the
Company in The City of New York; provided that payment
of interest may be made at the option of the Company by
check mailed to the address of the persons entitled
thereto. Notices, demands to or upon the Company in
respect of the Debentures of the First Series may be
served at the office or agency of the Company in The
City of New York. The Trustee will initially be the
agency of the Company for such service of notices and
demands; provided, however, that the Company reserves
the right to change, by one or more Officer's
Certificates any such office or agency. The Company
will be the Security Registrar and the Paying Agent for
the Debentures of the First Series;
7. The Debentures of the First Series will be redeemable
on or after at the option of the
Company, at any time and from time to time, in whole or
in part, at a redemption price equal to 100% of the
principal amount of the Debentures of the First Series
being redeemed, together with any accrued interest,
including Additional Interest, if any, to the
redemption date, upon not less than 30 nor more than 60
days' notice given as provided in the Indenture. The
Company, however, may not redeem less than all
Outstanding Debentures of the First Series unless the
conditions specified in the last paragraph of this item
are met;
The Debentures of the First Series will also be
redeemable at any time at the option of the Company
upon the occurrence and during the continuation of a
Tax Event or an Investment Company Event in whole but
not in part, at a redemption price equal to 100% of the
principal amount of the Debentures of the First Series
then Outstanding plus any accrued and unpaid interest,
including Additional Interest, if any, to the
redemption date, upon not less than 30 nor more than 60
days' notice given as provided in the Indenture. "Tax
Event" means the receipt by the Trust of an opinion of
counsel (which may be counsel to the Company or an
affiliate but not an employee thereof and which must be
acceptable to the Property Trustee under the Trust
Agreement) experienced in such matters to the effect
that, as a result of any amendment to, or change
(including any announced prospective change) in, the
laws (or any regulations thereunder) of the United
States or any political subdivision or taxing authority
thereof or therein affecting taxation, or as a result
of any official administrative or judicial decision
interpreting or applying such laws or regulations,
which amendment or change is effective or such
pronouncement or decision is announced on or after the
date of original issuance of the % Cumulative
Quarterly Income Preferred Securities, there is more
than an insubstantial risk that (i) the Trust is, or
will be within 90 days of the date thereof, subject to
United States federal income tax with respect to income
received or accrued on the Debentures of the First
Series, (ii) interest payable by the Company on the
Debentures of the First Series, is not, or within 90
days of the date thereof will not be, deductible, in
whole or in part, for United States federal income tax
purposes, or (iii) the Trust is, or will be within 90
days of the date thereof, subject to more than a de
minimis amount of other taxes, duties or other
governmental charges. "Investment Company Event" means
the occurrence of a change in law or regulation or a
change in interpretation or application of law or
regulation by any legislative body, court, governmental
agency or regulatory authority to the effect that the
Trust is or will be considered an "investment company"
that is required to be registered under the Investment
Company Act of 1940, as amended, which change in law
becomes effective on or after the date of original
issuance of the % Cumulative Quarterly Income
Preferred Securities.
The Debentures of the First Series will also be
redeemable, in whole but not in part, at the option of
the Company upon the termination and liquidation of the
Trust pursuant to an order for the dissolution,
termination or liquidation of the Trust entered by a
court of competent jurisdiction at a redemption price
equal to 100% of the principal amount of the Debentures
of the First Series then Outstanding plus any accrued and
unpaid interest, including Additional Interest, if any,
to the redemption date, upon not less than 30 nor more
than 60 days' notice given as provided in the Indenture.
The Company may not redeem less than all the Debentures
of the First Series unless all accrued and unpaid
interest (including any Additional Interest) has been
paid in full on all Debentures Outstanding under the
Indenture for all quarterly interest periods
terminating on or prior to the date of redemption or if
a partial redemption of % Cumulative Quarterly Income
Preferred Securities would result in a delisting of
such securities by any national securities exchange on
which they are then listed;
8. So long as any Debentures of the First Series are
Outstanding, the failure of the Company to pay interest
on any Debentures of the First Series within 30 days
after the same becomes due and payable (whether or not
payment is prohibited by the provisions of Article
Fifteen of the Indenture) shall constitute an Event of
Default; provided, however, that a valid extension of
the interest payment period by the Company as
contemplated in Section 311 of the Indenture and
paragraph (9) of this Certificate shall not constitute
a failure to pay interest for this purpose;
9. Pursuant to Section 311 of the Indenture, the Company
shall have the right, at any time and from time to time
during the term of the Debentures of the First Series,
to extend the interest payment period to a period not
exceeding 20 consecutive quarters (an "Extension
Period") during which period interest will be
compounded quarterly. At the end of the Extension
Period, the Company shall pay all interest accrued and
unpaid (together with interest thereon at the rate
specified for the Debentures of the First Series,
compounded quarterly, to the extent permitted by
applicable law). However, during any such Extension
Period, the Company shall not declare or pay any
dividend or distribution (other than a dividend or
distribution in common stock of the Company) on, or
redeem, purchase, acquire or make a liquidation payment
with respect to, any of its capital stock, or make any
payment of principal, interest or premium , if any, on
or repay, repurchase or redeem any indebtedness that is
pari passu with the Debentures of the First Series
(including other Securities issued under the
Indenture), or make any guarantee payments with respect
to the foregoing. Prior to the termination of any such
Extension Period, the Company may further extend the
interest payment period, provided that such Extension
Period together with all such previous and further
extensions thereof shall not exceed 20 consecutive
quarters at any one time or extend beyond the maturity
date of the Debentures of the First Series. Upon the
termination of any such Extension Period and the
payment of all amounts then due, the Company may select
a new Extension Period, subject to the above
requirements. No interest shall be due and payable
during an Extension Period, except at the end thereof.
The Company will give the Trust or other Holders and
the Trustee notice of its election of an Extension
Period prior to the earlier of (i) one Business Day
prior to the record date for the distribution which
would occur but for such election or (ii) the date the
Company is required to give notice to the New York
Stock Exchange or other applicable self-regulatory
organization of the record date;
10. In the event that, at any time subsequent to the
initial authentication and delivery of the Debentures
of the First Series, the Debentures of the First Series
are to be held by a securities depositary, the Company
may at such time establish the matters contemplated in
clause (r) in the second paragraph of Section 301 of
the Indenture in an Officer's Certificate supplemental
to this Certificate;
11. No service charge shall be made for the registration of
transfer or exchange of the Debentures of the First
Series; provided, however, that the Company may require
payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection
with the exchange or transfer;
12. The Debentures of the First Series shall have such
other terms and provisions as are provided in the form
set forth in Exhibit A hereto, and shall be issued in
substantially such form;
13. In the event that the Debentures of the First Series
are distributed to holders of % Cumulative
Quarterly Income Preferred Securities as a result of
the occurrence of (i) a Tax Event or (ii) an Investment
Company Event or (iii) at any time during which the
Trust is not or will not be taxed as a grantor trust
but a Tax Event has not occurred, the Company will use
its best efforts to list the Debentures of the First
Series on the New York Stock Exchange or on such other
exchange as the Preferred Securities are then listed;
14. The undersigned has read all of the covenants and
conditions contained in the Indenture relating to the
issuance of the Debentures of the First Series and the
definitions in the Indenture relating thereto and in
respect of which this certificate is made;
15. The statements contained in this certificate are based
upon the familiarity of the undersigned with the
Indenture, the documents accompanying this certificate,
and upon discussions by the undersigned with officers
and employees of the Company familiar with the matters
set forth herein;
16. In the opinion of the undersigned, he has made such
examination or investigation as is necessary to express
an informed opinion whether or not such covenants and
conditions have been complied with; and
17. In the opinion of the undersigned, such conditions and
covenants and conditions precedent, if any (including
any covenants compliance with which constitutes a
condition precedent) to the authentication and delivery
of the Debentures of the First Series requested in the
accompanying Company Order have been complied with.
IN WITNESS WHEREOF, the undersigned has executed this
Officer's Certificate this ____ day of February, 1996.
______________________________
James K. Vizanko
Treasurer
No._______________
Cusip No.__________
EXHIBIT A
[FORM OF FACE OF JUNIOR SUBORDINATED DEBENTURE]
MINNESOTA POWER & LIGHT COMPANY
% JUNIOR SUBORDINATED DEBENTURES, SERIES ,
DUE
MINNESOTA POWER & LIGHT COMPANY, a corporation duly
organized and existing under the laws of the State Minnesota
(herein referred to as the "Company", which term includes any
successor Person under the Indenture), for value received, hereby
promises to pay to ____________________________________, or
registered assigns, the principal sum of ____________________
Dollars on , and to pay interest on said
principal sum, from and including, , 1996 or from,
and excluding, the most recent Interest Payment Date through
which interest has been paid or duly provided for, quarterly on
March 31, June 30, September 30 and December 31 of each year,
commencing , 1996 at the rate of % per annum
until the principal hereof is paid or made available for payment.
The amount of interest payable on any Interest Payment Date shall
be computed on the basis of a 360-day year of twelve 30-day
months. Interest on the Securities of this series will accrue
from, and including, , 1996 through the first
Interest Payment Date, and thereafter will accrue, from, and
excluding, the last Interest Payment Date through which interest
has been paid or duly provided for. In the event that any
Interest Payment Date is not a Business Day, then payment of
interest payable on such date will be made on the next succeeding
day which is a Business Day (and without any interest or other
payment in respect of such delay), except that, if such Business
Day is in the next succeeding calendar year, such payment shall
be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on the Interest Payment
Date. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in
such Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest,
which shall be the Business Day 15 days preceding such Interest
Payment Date. Any such interest not so punctually paid or duly
provided for will forthwith cease to be payable to the Holder on
such Regular Record Date and may either be paid to the Person in
whose name this Security (or one or more Predecessor Securities)
is registered at the close of business on a Special Record Date
for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities
of this series not less than 10 days prior to such Special Record
Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on
which the Securities of this series may be listed, and upon such
notice as may be required by such exchange, all as more fully
provided in the Indenture referred to on the reverse hereof.
Payment of the principal of and premium, if any and
interest on this Security will be made at the office or agency of
the Company maintained for that purpose in The City of New York,
the State of New York in such coin or currency of the United
States of America as at the time of payment is legal tender for
payment of public and private debts, provided, however, that, at
the option of the Company, interest on this Security may be paid
by check mailed to the address of the person entitled thereto, as
such address shall appear on the Security Register.
Reference is hereby made to the further provisions of
this Security set forth on the reverse hereof, which further
provisions shall for all purposes have the same effect as if set
forth at this place.
Unless the certificate of authentication hereon has
been executed by the Trustee referred to on the reverse hereof by
manual signature, this Security shall not be entitled to any
benefit under the Indenture or be valid or obligatory for any
purpose.
IN WITNESS WHEREOF, the Company has caused this
instrument to be duly executed.
MINNESOTA POWER & LIGHT COMPANY
By:________________________________
ATTEST:
____________________________
[FORM OF CERTIFICATE OF AUTHENTICATION]
CERTIFICATE OF AUTHENTICATION
Dated:
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
[FORM OF REVERSE OF JUNIOR SUBORDINATED DEBENTURE]
This Security is one of a duly authorized issue of
securities of the Company (herein called the "Securities"),
issued and to be issued in one or more series under an Indenture,
dated as of , 1996 (herein, together with any
amendments thereto, called the "Indenture", which term shall have
the meaning assigned to it in such instrument), between the
Company and The Bank of New York, as Trustee (herein called the
"Trustee", which term includes any successor trustee under the
Indenture), and reference is hereby made to the Indenture,
including the Board Resolutions and Officer's Certificate filed
with the Trustee on , 1996 creating the series
designated on the face hereof, for a statement of the respective
rights, limitations of rights, duties and immunities thereunder
of the Company, the Trustee and the Holders of the Securities and
of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series
designated on the face hereof, limited in aggregate principal
amount to $ .
The Securities of this series are subject to redemption
upon not less than 30 nor more than 60 days' notice by mail, at
any time on or after as a whole or in
part, at the election of the Company, at a Redemption Price equal
to 100% of the principal amount, together in the case of any such
redemption with accrued interest to, but not including, the
Redemption Date, but interest installments whose Stated Maturity
is on or prior to such Redemption Date will be payable to the
Holder of such Security, or one or more Predecessor Securities,
of record at the close of business on the related Regular Record
Date referred to on the face hereof, all as provided in the
Indenture.
The Securities of this series will also be redeemable
at the option of the Company if a Tax Event or an Investment
Company Event shall occur and be continuing, in whole but not in
part, at a redemption price equal to 100% of the principal amount
of the Securities of this series then Outstanding plus any accrued
and unpaid interest, including Additional Interest, if any, to the
redemption date, upon not less than 30 nor more than 60 days'
notice given as provided in the Indenture. "Tax Event" means the
receipt by MP&L Capital I, a Delaware statutory business trust (the
"Trust") of an opinion of counsel (which may be counsel to the
Company or an affiliate but not an employee thereof and which must
be acceptable to the Property Trustee under the Trust Agreement)
experienced in such matters to the effect that, as a result of
any amendment to, or change (including any announced prospective
change) in, the laws (or any regulations thereunder) of the
United States or any political subdivision or taxing authority
thereof or therein affecting taxation, or as a result of any
official administrative or judicial decision interpreting or
applying such laws or regulations, which amendment or change is
effective or such pronouncement or decision is announced on or
after the date of original issuance of the % Cumulative
Quarterly Income Preferred Securities, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90
days of the date thereof, subject to United States federal income
tax with respect to income received or accrued on the Securities,
(ii) interest payable by the Company on the Securities, is not,
or within 90 days of the date thereof will not be, deductible, in
whole or in part, for United States federal income tax purposes,
or (iii) the Trust is, or will be within 90 days of the date
thereof, subject to more than a de minimis amount of other taxes,
duties or other governmental charges. "Investment Company Event"
means the occurrence of a change in law or regulation or a change
in interpretation or application of law or regulation by any
legislative body, court, governmental agency or regulatory
authority to the effect that the Trust is or will be considered
an "investment company" that is required to be registered under
the Investment Company Act of 1940, as amended, which change in
law becomes effective on or after the date of original issuance
of the % Cumulative Quarterly Income Preferred Securities.
The Securities of this series will also be redeemable,
in whole but not in part, at the option of the Company upon the
termination and liquidation of the Trust pursuant to an order
for the dissolution, termination or liquidation of the Trust
entered by a court of competent jurisdiction at a redemption
price equal to 100% of the principal amount of the Securities
of this series then Outstanding plus any accrued and unpaid
interest, including Additional Interest, if any, to the
redemption date, upon not less than 30 nor more than 60 days'
notice given as provided in the Indenture.
In the event of redemption of this Security in part
only, a new Security or Securities of this series and of like
tenor for the unredeemed portion hereof will be issued in the
name of the Holder hereof upon the cancellation hereof.
The indebtedness evidenced by this Security is, to the
extent provided in the Indenture, subordinated and subject in
right of payment to the prior payment in full of all Senior
Indebtedness, and this Security is issued subject to the
provisions of the Indenture with respect thereto. Each Holder of
this Security, by accepting the same, (a) agrees to and shall be
bound by such provisions, (b) authorizes and directs the Trustee
on his behalf to take such action as may be necessary or
appropriate to acknowledge or effectuate the subordination so
provided and (c) appoints the Trustee his attorney-in-fact for
any and all such purposes. Each Holder hereof, by his acceptance
hereof, hereby waives all notice of the acceptance of the
subordination provisions contained herein and in the Indenture by
each holder of Senior Indebtedness, whether now outstanding or
hereafter incurred, and waives reliance by each such Holder upon
said provisions.
The Indenture contains provisions for defeasance at any
time of the entire indebtedness of this Security upon compliance
with certain conditions set forth in the Indenture.
If an Event of Default with respect to Securities of
this series shall occur and be continuing, the principal of the
Securities of this series may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as
therein provided, the amendment thereof and the modification of
the rights and obligations of the Company and the rights of the
Holders of the Securities of each series to be affected under the
Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority in principal amount of the
Securities at the time Outstanding of all series to be affected.
The Indenture also contains provisions permitting the Holders of
specified percentages in principal amount of the Securities of
each series at the time Outstanding, on behalf of the Holders of
all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be
conclusive and binding upon such Holder and upon all future
Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made
upon this Security.
As provided in and subject to the provisions of the
Indenture, the Holder of this Security shall not have the right
to institute any proceeding with respect to the Indenture or for
the appointment of a receiver or trustee or for any other remedy
thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with
respect to the Securities of this series, the Holders of not less
than a majority in aggregate principal amount of the Securities
of all series at the time Outstanding in respect of which an
Event of Default shall have occurred and be continuing shall have
made written request to the Trustee to institute proceedings in
respect of such Event of Default as Trustee and offered the
Trustee reasonable indemnity, and the Trustee shall not have
received from the Holders of a majority in aggregate principal
amount of Securities of all series at the time Outstanding in
respect of which an Event of Default shall have occurred and be
continuing a direction inconsistent with such request, and shall
have failed to institute any such proceeding, for 60 days after
receipt of such notice, request and offer of indemnity. The
foregoing shall not apply to any suit instituted by the Holder of
this Security for the enforcement of any payment of principal
hereof or any premium or interest hereon on or after the
respective due dates expressed herein.
No reference herein to the Indenture and no provision
of this Security or of the Indenture shall alter or impair the
obligation of the Company, which is absolute and unconditional,
to pay the principal of and any premium and interest on this
Security at the times, place and rate, and in the coin or
currency, herein prescribed.
The Company has the right at any time and from time to
time during the term of the Securities of this series to extend
the interest payment period to a period not exceeding 20
consecutive quarters (an "Extended Interest Payment Period"), and
at the end of such Extended Interest Payment Period, the Company
shall pay all interest then accrued and unpaid (together with
interest thereon at the same rate as specified for the Securities
of this series, compounded quarterly, to the extent permitted by
applicable law); provided, however, that during such Extended
Interest Payment Period the Company shall not declare or pay any
dividend or distribution (other than a dividend or distribution
in common stock of the Company) on, or redeem, purchase, acquire
or make a liquidation payment with respect to, any of its capital
stock, or make any payment of principal on, interest or premium
if any, on or repay, repurchase or redeem any indebtedness that
is pari passu with the Securities of this series (including other
Securities issued under the Indenture), or make any guarantee
payments with respect to the foregoing. Prior to the termination
of any such Extended Interest Payment Period, the Company may
further extend the interest payment period, provided that such
Extended Interest Payment Period, together with all such previous
and further extensions thereof, may not exceed 20 consecutive
quarters or extend beyond the Stated Maturity of the Securities
of this series. Upon the termination of any such Extended
Interest Payment Period and the payment of all amounts then due,
the Company may select a new Extended Interest Payment Period,
subject to the above requirements. No interest during the
Extended Interest Payment Period, except at the end thereof,
shall be due and payable. The Company shall give the Holder of
this Security notice of its selection of such Extended Interest
Payment Period as provided in or pursuant to the Indenture.
The Securities of this series are issuable only in
registered form without coupons in denominations of $25 and any
integral multiple thereof. As provided in the Indenture and
subject to certain limitations therein set forth, Securities of
this series are exchangeable for a like aggregate principal
amount of Securities of this series and of like tenor and of
authorized denominations, as requested by the Holder surrendering
the same.
No service charge shall be made for any such
registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith.
The Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name this Security
is registered as the absolute owner hereof for all purposes,
whether or not this Security be overdue, and neither the Company,
the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in
the Indenture shall have the meanings assigned to them in the
Indenture.
Exhibit 23(a)
CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------
We hereby consent to the incorporation by reference in the
Prospectus constituting part of this Amendment No. 1 to the
Registration Statement on Form S-3 of our report dated January
22, 1996 which appears on page 10 of Minnesota Power's Current
Report on Form 8-K, dated February 16, 1996. We also consent to
the incorporation by reference in such Prospectus of our report
on the Financial Statement Schedule listed in Item 14(a) of
Minnesota Power's Annual Report on Form 10-K for the year ended
December 31, 1994, which report appears on page 31 of such Annual
Report. We also consent to the reference to us under the heading
"Experts" in such Prospectus.
/s/ PRICE WATERHOUSE LLP
------------------------
PRICE WATERHOUSE LLP
Minneapolis, Minnesota
March 11, 1996
Exhibit 23(b)
ERNST & YOUNG LLP One Indiana Square Phone: 317 681-7000
Suite 3400 Fax: 317 681 7216
Indianapolis, Indiana 46204-2094
Consent of Independent Auditors
We consent to the reference to our firm under the caption
"Experts" in Amendment No. 1 to the Registration Statement (Form
S-3 Nos. 333-01035 and 33-01035-01) and related Prospectus of
Minnesota Power & Light Company and MP&L Capital I with respect
to the offer of 3,000,000 Cumulative Quarterly Income Preferred
Securities and to the incorporation by reference therein of our
report dated February 9, 1995 (except Note 14, as to which the
date is February 23, 1995), with respect to the consolidated
financial statements of ADESA Corporation, which were included in
Minnesota Power & Light Company's Current Report on Form 8-K
dated July 12, 1995, and to our report dated January 17, 1996
(except Note 13, as to which the date is January 19, 1996), with
respect to the consolidated financial statements of ADESA
Corporation (not presented separately therein) which are included
in the consolidated financial statements of Minnesota Power &
Light Company that are included in Minnesota Power & Light
Company's Current Report on Form 8-K dated February 16, 1996,
filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
March 11, 1996