<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 4, 1997
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------------
NEVADA POWER COMPANY
(Exact Name of Registrant as Specified in its Charter)
<TABLE>
<S> <C>
NEVADA 88-0045330
(State or Other Jurisdiction of Incorporation or (I.R.S. Employer Identification Number)
Organization)
</TABLE>
NVP CAPITAL I AND NVP CAPITAL II
(Exact Name of Registrant as Specified in its Charter)
<TABLE>
<S> <C>
DELAWARE TO BE APPLIED FOR
(State or Other Jurisdiction of Incorporation or (I.R.S. Employer Identification Number)
Organization)
</TABLE>
6226 WEST SAHARA AVENUE, LAS VEGAS, NEVADA 89102, TELEPHONE (702) 367-5000
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Registrants' Principal Executive Offices)
CHARLES A. LENZIE, CHAIRMAN OF THE BOARD, NEVADA POWER COMPANY
P. O. BOX 230, LAS VEGAS, NEVADA 89151, TELEPHONE (702) 367-5000
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent for Service)
------------------------------
COPIES TO:
<TABLE>
<S> <C>
Glen E. Stephens, Esq. Robert A. Yolles, Esq.
Best Best & Krieger LLP Jones, Day, Reavis & Pogue
P. O. Box 1028 77 West Wacker Drive
Riverside, California 92502 Chicago, Illinois 60601
</TABLE>
------------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
WHEN MARKET CONDITIONS WARRANT AFTER THIS REGISTRATION STATEMENT BECOMES
EFFECTIVE.
------------------------------
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, check the following
box. / /
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / / ____________
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / / ____________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. /X/
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO OFFERING PRICE AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED BE REGISTERED PER UNIT(1) OFFERING PRICE(1) REGISTRATION FEE
<S> <C> <C> <C> <C>
NVP Capital I and NVP Capital II Cumulative
Quarterly Income Preferred Securities
("QUIPS"-SM-*)............................
Nevada Power Company Junior Subordinated
Deferrable Interest Debentures
("QUIDS"-SM-*)(2).........................
The Nevada Power Company Guarantees and
other obligations with respect to NVP
Capital I and NVP Capital II QUIPS under
an Indenture, an Amended and Restated
Trust Agreement and an Agreement as to
Expenses and Liabilities(2)...............
TOTAL(3).................................... $125,000,000 100% $125,000,000 $37,878.79
</TABLE>
(1) Estimated solely for the purpose of computing the registration fee.
(2) The Nevada Power Company Guarantees, when taken together with the Nevada
Power Company's obligations under the Series A QUIDS, the Indenture, the
Amended and Restated Trust Agreement and the Agreement as to Expenses and
Liabilities, will provide a full and unconditional guarantee, on a
subordinated basis, by Nevada Power Company of payments due on the QUIPS. No
consideration will be received for the Nevada Power Company Guarantees.
(3) Such amount represents the principal amount of the Junior Subordinated
Deferrable Interest Debentures. Such amount also represents the initial
public offering price of the NVP Capital I and NVP Capital II QUIPS.
* QUIPS and QUIDS are servicemarks of Goldman, Sachs & Co.
------------------------------
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
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.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
SUBJECT TO COMPLETION, DATED FEBRUARY , 1997
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.
<PAGE>
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED
FEBRUARY , 1997
5,000,000 PREFERRED SECURITIES
NVP CAPITAL I
% CUMULATIVE QUARTERLY INCOME PREFERRED SECURITIES,
SERIES A (QUIPS-SM-)*
(LIQUIDATION PREFERENCE $25 PER PREFERRED SECURITY)
GUARANTEED TO THE EXTENT THE SERIES A ISSUER HAS FUNDS, AS SET FORTH HEREIN, BY
NEVADA POWER COMPANY
The % Cumulative Quarterly Income Preferred Securities, Series A (the
"Series A QUIPS"), offered hereby represent undivided beneficial interests in
the assets of NVP Capital I, a trust formed under the laws of the State of
Delaware (the "Series A Issuer"). Nevada Power Company, a Nevada corporation
("Nevada Power"), will be the owner of all of the beneficial interests
represented by common securities of the Series A Issuer ("Series A Common
Securities"). IBJ Schroder Bank & Trust Company ("IBJ Schroder") is the Property
Trustee of the Series A Issuer. The Series A Issuer exists for the sole purpose
of issuing the Series A QUIPS and the Series A Common Securities and investing
the proceeds thereof in % Junior Subordinated Deferrable Interest Debentures,
Series A (the "Series A QUIDS"-SM-)*, to be issued by Nevada Power. The Series A
QUIDS will mature on , 2037, which date may be extended to a date
not later than , 2046 if certain conditions are met, and are
redeemable prior to maturity at Nevada Power's option as hereinafter described.
The Series A QUIPS will have a preference under certain circumstances with
respect to cash distributions and amounts payable on liquidation, redemption or
otherwise over the Series A Common Securities. See "Description of QUIPS--
Subordination of Common Securities" in the accompanying Prospectus.
(CONTINUED ON NEXT PAGE)
--------------
SEE "RISK FACTORS" BEGINNING ON PAGE S-4 HEREOF FOR CERTAIN INFORMATION
RELEVANT TO AN INVESTMENT IN THE SERIES A QUIPS.
--------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT
OR THE PROSPECTUS TO WHICH IT RELATES.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
PROCEEDS TO THE
INITIAL PUBLIC UNDERWRITING SERIES A
OFFERING PRICE COMMISSION(1) ISSUER(2)(3)
-------------- ------------------- ----------------
<S> <C> <C> <C>
Per Series A QUIPS............................................... $ (2) $
Total............................................................ $ (2) $
</TABLE>
- --------------
(1) The Series A Issuer and Nevada Power have agreed to indemnify the several
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933. See "Underwriting".
(2) In view of the fact that the proceeds of the sale of the Series A QUIPS will
be used to purchase the Series A QUIDS, the Underwriting Agreement provides
that Nevada Power will pay to the Underwriters, as compensation
("Underwriters' Compensation") for their arranging the investment therein of
such proceeds, $ per Series A QUIPS (or $ in the aggregate). See
"Underwriting".
(3) Expenses of the offering, which are payable by Nevada Power, are estimated
to be $ .
----------------
The Series A QUIPS offered hereby are offered severally by the Underwriters,
as specified herein, 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 the
Series A QUIPS will be ready for delivery in book-entry form only through the
facilities of The Depository Trust Company in New York, New York, on or about
, 1997, against payment therefor in immediately available funds.
- ----------------
* QUIPS and QUIDS are servicemarks of Goldman, Sachs & Co.
GOLDMAN, SACHS & CO.
---------
The date of this Prospectus Supplement is , 1997.
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY EFFECT TRANSACTIONS
WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SERIES A QUIPS AT A LEVEL
ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS
MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE OR OTHERWISE. SUCH STABILIZING,
IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
--------------
(CONTINUED FROM PREVIOUS PAGE)
Holders of the Series A QUIPS 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 , 1997, at the annual rate of % of
the liquidation preference of $25 per Series A QUIPS ("Distributions"). So long
as no Debenture Event of Default has occurred and is continuing, Nevada Power
has the right to defer payment of interest on the Series A QUIDS at any time or
from time to time for a period not exceeding 20 consecutive quarters (each, an
"Extension Period"), provided that no Extension Period may extend beyond the
Stated Maturity (as defined herein) of the Series A QUIDS. Upon the termination
of any such Extension Period and the payment of all amounts then due on any
Interest Payment Date (as defined herein), Nevada Power may elect to begin a new
Extension Period subject to the requirements set forth herein. At the end of
each Extension Period, Nevada Power shall pay all interest then accrued and
unpaid together with interest on all such accrued and unpaid amounts calculated
at the applicable rate. During an Extension Period, Nevada Power may prepay any
deferred interest prior to the end of an Extension Period in whole or in part on
any Interest Payment Date. If interest payments on the Series A QUIDS are so
deferred, Distributions on the Series A QUIPS will also be deferred and Nevada
Power will not be permitted and no subsidiary of Nevada Power will be permitted,
subject to certain exceptions set forth herein, to (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of Nevada Power's capital stock or (ii)
make any payment of principal of, or interest or premium, if any, on, or repay,
repurchase or redeem, or make any sinking fund payment with respect to, any
indebtedness that ranks PARI PASSU with or junior in right of payment to the
Series A QUIDS, or make any guarantee payments with respect to any indebtedness
if such guarantee ranks PARI PASSU with or junior in right of payment to the
Series A QUIDS. During an Extension Period, interest on the Series A QUIDS will
continue to accrue (and the amount of Distributions to which holders of the
Series A QUIPS are entitled will accumulate at the rate of % per annum,
compounded quarterly) and holders of Series A QUIPS will be required to accrue
interest income in the form original issue discount ("OID") for United States
federal income tax purposes as described herein. See "Certain Terms of Series A
QUIDS--Option to Extend Interest Payment Period" and "Certain Federal Income Tax
Consequences--Potential Extension of Interest Payment Period and Original Issue
Discount" and "--Payments of Interest".
The Series A Guarantee of Nevada Power guarantees the payment of
Distributions and payments on liquidation or redemption of the Series A QUIPS,
but only in each case to the extent of funds held by the Series A Issuer, as
described herein (the "Series A Guarantee"). See "Description of Guarantees" in
the accompanying Prospectus. If Nevada Power does not make interest payments on
the Series A QUIDS held by the Series A Issuer, the Series A Issuer will have
insufficient funds to pay Distributions on the Series A QUIPS. The Series A
Guarantee does not cover payment of Distributions when the Series A Issuer does
not have sufficient funds to pay such Distributions. In such event, a holder of
Series A QUIPS may institute a legal proceeding directly against Nevada Power to
enforce payment of such Distributions to such holder. The obligations of Nevada
Power under the Series A Guarantee and the Series A QUIDS are subordinate and
junior in right of payment to all Senior Debt (as defined in "Description of
QUIDS-- Subordination" in the accompanying Prospectus) of Nevada Power.
The Series A QUIPS are subject to mandatory redemption, in whole or in part,
upon repayment of the Series A QUIDS at maturity or their earlier redemption in
an amount equal to the amount of related
S-2
<PAGE>
Series A QUIDS maturing or being redeemed at a redemption price ("Redemption
Price") equal to the aggregate liquidation preference of such Series A QUIPS
plus accumulated and unpaid Distributions thereon to the date of redemption. See
"Description of QUIPS--Redemption Procedures". The Series A QUIDS are redeemable
prior to maturity at the option of Nevada Power (i) on or after ,
2002, in whole at any time or in part from time to time or (ii) at any time, in
whole (but not in part) upon the occurrence and continuation of a Special Event
(as defined herein), in each case subject to the further conditions described
under "Description of QUIDS--Redemption" and "Description of Corresponding
QUIDS--Optional Redemption" in the accompanying Prospectus. The redemption price
in either such event will equal 100% of the principal amount of Series A QUIDS
to be redeemed plus accrued and unpaid interest thereon to the date of
redemption.
At any time, Nevada Power will have the right to terminate the Series A
Issuer and cause the Series A QUIDS to be distributed to the holders of the
Series A QUIPS in liquidation of the Series A Issuer. If Nevada Power elects to
liquidate the Series A Issuer and thereby causes the Series A QUIDS to be
distributed to holders of the Series A QUIPS in liquidation of the Series A
Issuer, Nevada Power may shorten or extend the maturity of such Series A QUIDS,
except that it can only extend the maturity if certain conditions are met. See
"Certain Terms of Series A QUIPS--Special Event Redemption or Distribution of
Series A QUIDS".
The Series A QUIDS are subordinate and junior in right of payment to all
Senior Debt of Nevada Power. As of December 31, 1996, Nevada Power had
approximately $900 million aggregate principal amount of Senior Debt
outstanding. The terms of the Series A QUIDS place no limitation on the amount
of Senior Debt that may be incurred by Nevada Power. See "Description of
QUIDS--Subordination" in the accompanying Prospectus.
In the event of the liquidation of the Series A Issuer, after satisfaction
of the creditors of the Series A Issuer as provided by applicable law, the
holders of the Series A QUIPS will be entitled to receive a liquidation
preference of $25 per Series A QUIPS plus accumulated and unpaid Distributions
thereon to the date of payment, which may be in the form of a distribution of
such amount in Series A QUIDS, subject to certain exceptions. See "Description
of QUIPS--Liquidation Distribution Upon Termination" in the accompanying
Prospectus.
Application will be made to list the Series A QUIPS on the New York Stock
Exchange (the "NYSE") under the symbol ' '. Trading of the Series A QUIPS
on the NYSE is expected to commence within 30 days after the initial delivery of
the Series A QUIPS. If the Series A QUIDS are distributed to the holders of
Series A QUIPS upon the liquidation of the Series A Issuer, Nevada Power will
use its best efforts to list the Series A QUIDS on the NYSE or such other stock
exchanges, if any, on which the Series A QUIPS are then listed.
The Series A QUIPS will be represented by global certificates registered in
the name of The Depository Trust Company ("DTC") or its nominee. Beneficial
interests in the Series A QUIPS will be shown on, and transfers thereof will be
effected only through, records maintained by participants in DTC. Except as
described in the accompanying Prospectus, Series A QUIPS in certificated form
will not be issued in exchange for the global certificates. See "Description of
QUIPS--Book-Entry Issuance" in the accompanying Prospectus.
S-3
<PAGE>
THE FOLLOWING INFORMATION SUPPLEMENTS AND SHOULD BE READ IN CONJUNCTION WITH
THE INFORMATION CONTAINED IN THE ACCOMPANYING PROSPECTUS. AS USED HEREIN, (I)
THE "INDENTURE" MEANS THE JUNIOR SUBORDINATED INDENTURE, AS AMENDED AND
SUPPLEMENTED FROM TIME TO TIME, INCLUDING THE FIRST SUPPLEMENTAL INDENTURE
RELATING TO THE SERIES A QUIDS, BETWEEN NEVADA POWER AND IBJ SCHRODER AS TRUSTEE
(THE "DEBENTURE TRUSTEE"), AND (II) THE "TRUST AGREEMENT" MEANS THE AMENDED AND
RESTATED TRUST AGREEMENT AMONG NEVADA POWER, AS DEPOSITOR, IBJ SCHRODER, AS
PROPERTY TRUSTEE (THE "PROPERTY TRUSTEE") AND DELAWARE TRUST CAPITAL MANAGEMENT,
AS DELAWARE TRUSTEE (THE "DELAWARE TRUSTEE"), THE ADMINISTRATIVE TRUSTEES NAMED
THEREIN (COLLECTIVELY, WITH THE PROPERTY TRUSTEE AND DELAWARE TRUSTEE, THE
"ISSUER TRUSTEES") AND THE HOLDERS AS DEFINED THEREIN. EACH OF THE OTHER
CAPITALIZED TERMS USED IN THIS PROSPECTUS SUPPLEMENT AND NOT OTHERWISE DEFINED
IN THIS PROSPECTUS SUPPLEMENT HAS THE MEANING SET FORTH IN THIS PROSPECTUS
SUPPLEMENT OR IN THE ACCOMPANYING PROSPECTUS.
RISK FACTORS
Prospective purchasers of the Series A QUIPS should carefully review the
information contained elsewhere in this Prospectus Supplement and in the
accompanying Prospectus and should particularly consider the following matters.
DEPENDENCE OF SERIES A ISSUER ON NEVADA POWER FOR FUNDS; SUBORDINATION OF THE
SERIES A GUARANTEE AND THE SERIES A QUIDS
The ability of the Series A Issuer to pay amounts due on the Series A QUIPS
is solely dependent upon Nevada Power making payments on the Series A QUIDS as
and when required.
The obligations of Nevada Power under the Series A Guarantee and the Series
A QUIDS issued by Nevada Power for the benefit of the holders of Series A QUIPS
are unsecured and rank subordinate and junior in right of payment to all Senior
Debt of Nevada Power. As of December 31, 1996, Nevada Power had approximately
$900 million aggregate principal amount of Senior Debt outstanding. Neither the
Indenture, the Series A Guarantee nor the Trust Agreement places any limitation
on the amount of secured or unsecured debt, including Senior Debt, that may be
incurred by Nevada Power, whether under the Indenture or any existing or other
indenture that Nevada Power may enter into in the future or otherwise,
including, without limitation, Nevada Power's Indenture of Mortgage and Deed of
Trust dated October 1, 1953 entered into with Banker's Trust Company, together
with supplemental indentures thereto heretofore or hereafter entered into (the
"Mortgage Indenture"). At December 31, 1996, the aggregate principal amount of
indebtedness outstanding under the Mortgage Indenture was $443 million, all of
which is secured by a first mortgage lien and security interest in substantially
all of the tangible property of Nevada Power. See "Description of
Guarantees--Status of the Guarantees" and "Description of QUIDS--Subordination"
in the accompanying Prospectus.
OPTION TO EXTEND INTEREST PAYMENT PERIOD; TAX CONSEQUENCES; POTENTIAL MARKET
VOLATILITY DURING EXTENSION PERIOD
So long as no Event of Default under the Indenture has occurred and is
continuing, Nevada Power has the right under the Indenture to defer the payment
of interest on the Series A QUIDS at any time or from time to time for a period
not exceeding 20 consecutive quarters with respect to each Extension Period,
provided that no Extension Period may extend beyond the Stated Maturity of the
Series A QUIDS. At the end of each Extension Period, Nevada Power shall pay all
interest then accrued and unpaid together with interest on all such accrued and
unpaid amounts calculated at the applicable rate. During an Extension Period,
Nevada Power may prepay any deferred interest prior to the end of an Extension
Period in whole or in part on any Interest Payment Date. Upon the termination of
any Extension Period and the payment of all payments then due on any Interest
Payment Date, Nevada Power may elect to begin a new Extension Period subject to
the above requirements. If interest payments on the Series A QUIDS are so
deferred, Distributions on the Series A QUIPS will also be deferred and Nevada
Power will not be permitted, and no subsidiary of Nevada Power will be
permitted, subject to certain exceptions set forth herein, to (i) declare
S-4
<PAGE>
or pay any dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of Nevada Power's capital stock or (ii)
make any payment of principal of, or interest or premium, if any, on, or repay,
repurchase or redeem, or make any sinking fund payment with respect to, any
indebtedness that ranks PARI PASSU with or junior in right of payment to the
Series A QUIDS, or make any guarantee payments with respect to any indebtedness
if such guarantee ranks PARI PASSU with or junior in right of payment to the
Series A QUIDS. During an Extension Period, interest on the Series A QUIDS will
continue to accrue (and the amount of Distributions to which holders of the
Series A QUIPS are entitled will accumulate at the rate of % per annum,
compounded quarterly) and holders of Series A QUIDS will be required to accrued
interest income in the form of OID for the United States federal income tax
purposes in advance of receipt of cash related to such income. See "Certain
Terms of Series A QUIDS--Option to Extend Interest Payment Period" and "Certain
Federal Income Tax Consequences-- Potential Extension of Interest Payment Period
and Original Issue Discount".
Should an Extension Period occur, a holder of Series A QUIPS will accrue
income (in the form of OID) in respect of its pro rata share of the Series A
QUIDS held by the Series A Issuer for United States federal income tax purposes.
As a result, a holder of Series A QUIPS will include such income 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 the Series A Issuer if
the holder disposes of the Series A QUIPS prior to the record date for the
payment of Distributions. See "Certain Federal Income Tax Consequences--Payments
of Interest", "--Potential Extension of Interest Payment Period and Original
Issue Discount" and "--Sale or Redemption of Series A QUIPS".
Nevada Power has no current intention of exercising its right to defer
payments of interest by extending the interest payment period on the Series A
QUIDS. However, should Nevada Power elect to exercise such right in the future,
the market price of the Series A QUIPS is likely to be adversely affected. A
holder that disposes of its Series A QUIPS during an Extension Period,
therefore, might not receive the same return on its investment as a holder that
continues to hold its Series A QUIPS. In addition, as a result of the existence
of Nevada Power's right to defer interest payments, the market price of the
Series A QUIPS (which represent preferred undivided beneficial interests in the
Series A QUIDS) may be more volatile than the market prices of other securities
on which OID accrues that are not subject to such deferrals.
RIGHTS UNDER THE SERIES A GUARANTEE; LIMITED FUNDS AVAILABLE TO SERIES A ISSUER
The Series A Guarantee guarantees to the holders of the Series A QUIPS the
following payments to the extent not paid by the Series A Issuer, (i) any
accumulated and unpaid Distributions required to be paid on the Series A QUIPS,
if and to the extent that the Series A Issuer has funds on hand available
therefor at such time, (ii) the Redemption Price with respect to any Series A
QUIPS called for redemption, if and to the extent that the Series A Issuer has
funds on hand available therefor at such time, and (iii) upon a voluntary or
involuntary dissolution, winding-up or liquidation of the Series A Issuer
(unless the Series A QUIDS are distributed to holders of the Series A QUIPS),
the lesser of (a) the aggregate of the liquidation preference and all accrued
and unpaid Distributions to the date of payment to the extent that the Series A
Issuer has funds on hand available therefor at such time and (b) the amount of
assets of the Series A Issuer remaining available for distribution to holders of
the Series A QUIPS in liquidation of the Series A Issuer. If Nevada Power were
to default on its obligation to pay amounts payable under the Series A QUIDS,
the Series A Issuer would lack funds for the payment of Distributions or amounts
payable on redemption of the Series A QUIPS or otherwise, and, in such event,
holders of the Series A QUIPS would not be able to rely upon the Series A
Guarantee for payment of such amounts. In addition, the Series A Guarantee will
constitute an unsecured obligation of Nevada Power and will rank subordinate and
junior in right of payment to all Senior Debt of Nevada Power.
S-5
<PAGE>
SPECIAL EVENT REDEMPTION
Upon the occurrence and continuation of a Special Event (as defined under
"Description of QUIDS--Redemption"), Nevada Power has the right to redeem the
Series A QUIDS in whole (but not in part) within 90 days following the
occurrence of such Special Event and thereby cause a mandatory redemption of the
Series A QUIPS at the Redemption Price.
On March 19, 1996, the Revenue Reconciliation Bill of 1996 (the "Bill"), the
revenue portion of President Clinton's budget proposal, was released. The Bill
would, among other things, generally have denied interest deductions for
interest on an instrument, issued by a corporation, that had a maximum weighted
average maturity of more than 40 years. The Bill would also generally have
denied interest deductions for interest on an instrument, issued by a
corporation, that had a maximum term of more than 20 years and that was not
shown as indebtedness on the separate balance sheet of the issuer or, where the
instrument was issued to a related party (other than a corporation), where the
holder or some other related party issues a related instrument that was not
shown as indebtedness on the issuer's consolidated balance sheet. For purposes
of determining the weighted average maturity or the term of an instrument, any
right to extend would have been treated as exercised. The above-described
provisions of the Bill were proposed to be effective generally for instruments
issued on or after December 7, 1995. If either provision were to apply to the
Series A QUIDS, Nevada Power would be unable to deduct interest on the Series A
QUIDS. However, on March 29, 1996, the Chairmen of the Senate Finance and House
Ways and Means Committees issued a joint statement to the effect that it was
their intention that the effective date of the President's legislative
proposals, if adopted, would be no earlier than the date of appropriate
Congressional action.
Nevada Power believes that, under current law, it will be able to deduct
interest on the Series A QUIDS. Although the session of Congress in which the
Bill was introduced adjourned without enacting the Bill, there can be no
assurance that future legislation will not be introduced and enacted which would
adversely affect the ability of Nevada Power to deduct interest on the Series A
QUIDS or otherwise affect the tax treatment of the transaction described herein.
A change in the deductibility of interest and certain other changes could give
rise to a Tax Event, which may permit Nevada Power to cause a redemption of the
Series A QUIPS, as described more fully in the accompanying Prospectus under
"Description of QUIPS-- Redemption--Special Event Redemption or Distribution of
Corresponding QUIDS". See "Certain Federal Income Tax Consequences."
DISTRIBUTION OF SERIES A QUIDS UPON TERMINATION; POTENTIAL ADVERSE EFFECT UPON
MARKET PRICE
Nevada Power has the right to terminate the Series A Issuer at any time and,
after satisfaction of liabilities to creditors of the Series A Issuer, cause the
Series A QUIDS to be distributed to the holders of Series A QUIPS in liquidation
of the Series A Issuer. There can be no assurance as to the market prices for
Series A QUIDS that may be distributed in exchange for Series A QUIPS if a
liquidation of the Series A Issuer occurs. See "Certain Terms of Series A
QUIPS--Special Event Redemption or Distribution of Series A QUIDS". If the
Series A QUIDS are so distributed, Nevada Power will use its best efforts to
have the Series A QUIDS listed on the NYSE or on such other exchange as the
Series A QUIDS are then listed or traded.
Series A QUIDS that a holder of Series A QUIPS may receive on termination
and liquidation of the Series A Issuer may trade at a discount to the price that
the investor paid to purchase the Series A QUIPS offered hereby. Because holders
of Series A QUIPS may receive Series A QUIDS on termination of the Series A
Issuer, prospective purchasers of Series A QUIPS are also making an investment
decision with regard to the Series A QUIDS and should carefully review all the
information regarding the Series A QUIDS contained herein. See "Certain Federal
Income Tax Consequences" herein and "Description of QUIPS--Redemption--Special
Event Redemption or Distribution of Corresponding QUIDS" and "Description of
Corresponding QUIDS--General" in the accompanying Prospectus.
S-6
<PAGE>
Under current United States federal income tax law and interpretations, a
distribution of the Series A QUIDS upon liquidation of the Series A Issuer
should not be a taxable event to holders of the Series A QUIPS. Should there be
a change in law, a change in legal interpretation, a Tax Event or other
circumstances, however, the distribution could be a taxable event to the holders
of the Series A QUIPS. See "Certain Federal Income Tax
Consequences--Distribution of Series A QUIDS to Holders of Series A QUIPS".
LIMITED VOTING RIGHTS
Holders of Series A QUIPS will generally have limited voting rights relating
only to the modification of the Series A QUIPS and the dissolution, winding-up
or liquidation of the Series A Issuer. Holders of Series A QUIPS 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 Series A Common Securities except upon the occurrence of certain events
described herein. The Issuer Trustees and Nevada Power may amend the Trust
Agreement without the consent of holders of Series A QUIPS to ensure that the
Series A Issuer will be classified for United States federal income tax purposes
as a grantor trust even if such action adversely affects the interests of such
holders. See "Description of QUIPS--Voting Rights; Amendment of Each Trust
Agreement" and "--Removal of Issuer Trustees" in the accompanying Prospectus.
NO ESTABLISHED TRADING MARKET FOR THE SERIES A QUIPS; TRADING PRICE; POTENTIAL
ADVERSE INCOME TAX EFFECT
Application will be made to list the Series A QUIPS on the NYSE. If approved
for listing, should an Extension Period occur, the Series A QUIPS may trade at
prices that do not fully reflect the value of accrued but unpaid interest with
respect to the underlying Series A QUIDS. A holder of Series A QUIPS that
disposes of its Series A QUIPS between record dates for payments of
Distributions will nevertheless be required to include in income as ordinary OID
income an amount equal to the accrued but unpaid interest on the Series A QUIDS
through the date of disposition and to add such amount to its adjusted tax basis
in such holder's pro rata share of the underlying Series A QUIDS deemed disposed
of. Such holder will recognize a capital loss to the extent the selling price
(which may not fully reflect the value of accrued but unpaid interest) is less
than its adjusted tax basis (which will include the full amount of any accrued
but unpaid interest). Subject to certain limited exceptions, capital losses
cannot be applied to offset ordinary income for United States federal income tax
purposes. See "Certain Federal Income Tax Consequences-- Sale or Redemption of
Series A QUIPS".
NVP CAPITAL I
NVP Capital I is a statutory business trust formed under Delaware law
pursuant to (i) the Trust Agreement executed by Nevada Power, as Depositor, IBJ
Schroder, as Property Trustee, and Delaware Trust Capital Management, as
Delaware Trustee, and the Administrative Trustees named therein, and (ii) the
filing of a certificate of trust with the Secretary of State of the State of
Delaware on January 31, 1997. The Trust Agreement will be qualified under the
Trust Indenture Act of 1939, as amended ("Trust Indenture Act"). The Series A
Issuer's business and affairs are conducted by the Issuer Trustees: IBJ
Schroder, as Property Trustee, and Delaware Trust Capital Management, as
Delaware Trustee, and two individual Administrative Trustees who are employees
or officers of or affiliated with Nevada Power. The Series A Issuer exists for
the exclusive purposes of (i) issuing and selling the Series A QUIPS and Series
A Common Securities, (ii) using the proceeds from the sale of Series A QUIPS and
Series A Common Securities to acquire Series A QUIDS issued by Nevada Power,
(iii) receiving payments to be made with respect to the Series A QUIDS and
disbursing such payments in accordance with the terms of the Trust Agreement and
(iv) engaging in only those other activities necessary, convenient or incidental
thereto. Accordingly, the Series A QUIDS will be the sole assets of the Series A
Issuer, and payments under the
S-7
<PAGE>
Series A QUIDS will be the sole revenue of the Series A Issuer. All of the
Series A Common Securities will be owned by Nevada Power. The Series A Common
Securities will rank PARI PASSU, and payments will be made thereon pro rata,
with the Series A QUIPS, except that upon the occurrence and continuance of an
event of default under the Trust Agreement resulting from a Debenture Event of
Default, the rights of Nevada Power as holder of the Series A 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 Series A
QUIPS. See "Description of QUIPS--Subordination of Common Securities" in the
accompanying Prospectus. Nevada Power will acquire Series A Common Securities in
an aggregate liquidation amount equal to 3% of the total capital of the Series A
Issuer. The Series A Issuer has a term of 55 years, but may terminate earlier as
provided in the Trust Agreement. The principal executive office of the Series A
Issuer is 6226 West Sahara Avenue, Las Vegas, Nevada 89102, Attention:
Secretary, and its telephone number is (702) 367-5000. See "The Issuers" in the
accompanying Prospectus.
NEVADA POWER COMPANY
Nevada Power, incorporated under the laws of Nevada in 1929, is an operating
public utility engaged in the electric utility business in the City of Las Vegas
and vicinity in Southern Nevada. As of September 30, 1996, Nevada Power served
approximately 478,620 customers in its service area which has a population of
approximately 1,250,000. For the year 1995, Nevada Power's electric energy
requirements were obtained from the following sources: coal generation--43%, oil
and natural gas--13%, and purchased power, including hydroelectric--44%.
Growth in Nevada Power's service territory is continuing at a rapid pace.
Nevada Power's customer base grew at annual rates of 7.2%, 6.0% and 6.0% during
1996, 1995 and 1994, respectively. Kilowatthour sales increased 13.1%, 1.4% and
7.1% during 1996, 1995 and 1994, respectively.
The principal executive offices of Nevada Power are located in Las Vegas,
Nevada, and its mailing address is P.O. Box 230, Las Vegas, Nevada 89151,
telephone number (702) 367-5000.
RECENT DEVELOPMENTS
In January 1997, the Public Service Commission of Nevada ("PSCN") approved
Nevada Power's request to reduce customers' rates by nearly $45 million on an
annual basis. Nevada Power's aggressive reductions of its own fuel costs,
combined with its ability to take advantage of low fuel prices for purchased
power in wholesale markets resulted in the largest single rate reduction in
Nevada Power's history. In January 1997, the PSCN also rendered its decision in
a separate matter involving a long-standing dispute between Nevada Power, the
PSCN Staff and the Office of Consumer Advocate, involving various coal
contracting matters, and ordered a one-time reduction in customer rates of
approximately $8.5 million. The decision on the coal contracting matters will
result in a $5.5 million after tax reduction in fourth quarter 1996 earnings
available to common shareholders or approximately $0.11 per average common
share.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratios of earnings to fixed charges for
Nevada Power for the periods indicated:
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
-------------------- -----------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Twelve Months Ratio of Earnings to Fixed
Charges.......................................... 3.02 2.92 2.84 3.11 2.90 2.42 1.89
</TABLE>
S-8
<PAGE>
In computing the ratio, earnings represent income before interest expenses,
plus income taxes; fixed charges represent the total of interest on long-term
debt, amortization of debt discount, premiums and expenses, other interest, plus
one-third annual rentals.
USE OF PROCEEDS
All of the proceeds from the sale of the Series A QUIPS will be invested by
the Series A Issuer in Series A QUIDS. Nevada Power intends that the proceeds
from the sale will be used for general corporate utility purposes, which may
include the purchase or redemption of one or more series of its preferred stock,
capital expenditures, the reduction of short-term borrowings and working
capital.
ACCOUNTING TREATMENT
For financial reporting purposes, the Series A Issuer will be treated as a
subsidiary of Nevada Power and, accordingly, the accounts of the Series A Issuer
will be included in the financial statements of Nevada Power. The Series A QUIPS
will be presented as a separate line item in the balance sheet of Nevada Power
and appropriate disclosures about the Series A QUIPS, the Series A Guarantee and
the Series A QUIDS will be included in the notes to the financial statements.
For financial reporting purposes, Nevada Power will record Distributions payable
on the Series A QUIPS as an expense.
S-9
<PAGE>
CAPITALIZATION
The following table sets forth the capitalization of Nevada Power, the
Series A Issuer and Nevada Power's subsidiaries as of September 30, 1996 and as
adjusted to give effect to the sale of $125 million Series A QUIPS, the assumed
application of a portion of the proceeds therefrom to redeem all of Nevada
Power's outstanding preferred stock and the sale in October 1996 of $20 million
Pollution Control Revenue Bonds due 2036. The following data should be read in
conjunction with the financial statements and notes thereto and Management's
Discussion and Analysis of Financial Condition and Results of Operation of
Nevada Power incorporated herein by reference to Nevada Power's Annual Report on
Form 10-K for the year ended December 31, 1995 and Quarterly Reports on Form
10-Q for the quarters ended March 31, June 30 and September 30, 1996.
<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1996
--------------------------
ACTUAL AS ADJUSTED
------------ ------------
(IN THOUSANDS)
<S> <C> <C>
DEBT:
Short-Term Debt and Current Maturities................................................ $ 12,738 $ 12,738
Secured Debt:
Capital Leases...................................................................... 97,748 97,748
Other Secured....................................................................... 536,958 536,958
------------ ------------
Total Secured Debt................................................................ 634,706 634,706
------------ ------------
Unsecured Debt:
Pollution Control Revenue Bonds..................................................... 33,300 53,300
Industrial Development Bonds........................................................ 133,761 133,761
------------ ------------
Total Unsecured Debt.............................................................. 167,061 187,061
------------ ------------
Total Debt...................................................................... 814,505 834,505
------------ ------------
Guaranteed Preferred Beneficial Interests in Company's Debentures..................... -- 125,000
SHAREHOLDERS' EQUITY:
Cumulative Preferred Stock with Mandatory Sinking Funds and Redeemable Cumulative
Preferred Stock..................................................................... 41,664 --
Common Shareholders' Equity........................................................... 814,338 814,338
------------ ------------
Total Shareholders' Equity........................................................ 856,002 814,338
------------ ------------
Total Capitalization............................................................ $ 1,670,507 $ 1,773,843
------------ ------------
------------ ------------
</TABLE>
S-10
<PAGE>
SELECTED FINANCIAL AND OPERATING INFORMATION
The following selected financial data for the five years ended December 31,
1995 are derived from the audited financial statements of Nevada Power for the
respective years in the five-year period then ended. The following selected data
as of and for the periods ended September 30, 1996 and 1995 have been derived
from financial statements of Nevada Power that have not been audited, but that,
in the opinion of the management of Nevada Power, reflect all adjustments
necessary for the fair presentation of such data for the interim periods. The
results of operations for the nine months ended September 30, 1996 are not
necessarily indicative of the results of operations for the full year. This
financial information should be read in conjunction with the financial
statements and related notes thereto incorporated herein by reference to Nevada
Power's Annual Report on Form 10-K for the year ended December 31, 1995 and
Quarterly Reports on Form 10-Q for the quarters ended March 31, June 30 and
September 30, 1996.
SELECTED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
NINE MONTHS
ENDED
SEPTEMBER 30, YEAR ENDED DECEMBER 31,
-------------------- -----------------------------------------------------
INCOME STATEMENT DATA: 1996 1995 1995 1994 1993 1992 1991
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Electric revenues............. $ 640,132 $ 598,667 $ 749,981 $ 764,158 $ 651,772 $ 600,915 $ 546,411
Operating expenses............ 464,305 449,121 579,105 593,907 489,624 456,725 440,059
--------- --------- --------- --------- --------- --------- ---------
Earnings before income
taxes....................... 175,827 149,546 170,876 170,251 162,148 144,190 106,352
Interest expense.............. 36,740 34,087 46,936 43,015 39,305 41,466 40,138
Taxes......................... 58,638 49,882 53,318 56,454 53,679 44,068 28,925
Other income (expenses)....... 1,686 5,446 6,349 11,088 4,384 (1,876) (2,113)
--------- --------- --------- --------- --------- --------- ---------
Net Income.................... 82,135 71,023 76,971 81,870 73,548 56,780 35,176
Dividend requirements on
preferred stock............. 2,968 2,975 3,966 3,976 3,986 4,262 2,880
--------- --------- --------- --------- --------- --------- ---------
Earnings available for common
stock....................... $ 79,167 $ 68,048 $ 73,005 $ 77,894 $ 69,562 $ 52,518 $ 32,296
--------- --------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- --------- ---------
Weighted average common shares
outstanding................. 47,757 46,081 46,288 42,784 39,482 35,652 30,855
Earnings per average common
share....................... $ 1.66 $ 1.48 $ 1.58 $ 1.82 $ 1.76 $ 1.47 $ 1.05
BALANCE SHEET DATA:
Net property, plant &
equipment................... $1,790,620 $1,661,424 $1,701,120 $1,584,003 $1,450,146 $1,328,670 $1,187,154
Total assets.................. 2,141,804 2,035,548 2,047,611 1,907,389 1,809,337 1,557,040 1,410,022
Long-term debt................ 801,767 786,459 799,999 712,571 716,589 715,451 578,540
Shareholders' equity.......... 856,002 812,392 806,224 773,813 688,188 574,937 502,971
CASH FLOW DATA:
Cash from operating
activities.................. $ 128,442 $ 157,275 $ 185,919 $ 144,270 $ 130,945 $ 107,378 $ 100,305
Cash from investing
activities.................. (134,771) (105,031) (160,828) (184,349) (165,858) (175,200) (152,142)
Cash from financing
activities.................. (18,314) 12,775 293 40,057 34,898 67,828 51,806
--------- --------- --------- --------- --------- --------- ---------
Net increase (decrease) during
the period.................. $ (24,643) $ 65,019 $ 25,384 $ (22) $ (15) $ 6 $ (31)
--------- --------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- --------- ---------
</TABLE>
SELECTED OPERATING INFORMATION
<TABLE>
<CAPTION>
NINE MONTHS
ENDED
SEPTEMBER 30, YEAR ENDED DECEMBER 31,
-------------------- -----------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Electric sales (megawatt hours,
in thousands)................. 10,567,324 9,362,465 12,109,355 11,942,724 11,155,270 10,541,204 9,834,952
</TABLE>
S-11
<PAGE>
CERTAIN TERMS OF SERIES A QUIPS
The following summary of certain terms and provisions of the Series A QUIPS
and the Trust Agreement supplements the description of the terms and provisions
of the QUIPS set forth in the accompanying Prospectus under the heading
"Description of QUIPS", to which description reference is hereby made. This
summary of certain terms and provisions of the Series A QUIPS and the Trust
Agreement does not purport to be complete and is subject to, and qualified in
its entirety by reference to, the Trust Agreement and the Trust Indenture Act.
The form of the Trust Agreement has been filed as an exhibit to the Registration
Statement of which this Prospectus Supplement and accompanying Prospectus is a
part.
GENERAL
The Series A QUIPS and Series A Common Securities represent undivided
beneficial interests in the assets of the Series A Issuer. The Series A QUIPS
and Series A Common Securities will have a liquidation preference of $25 per
unit. Approximately 97% of the total liquidation preference amount will be
represented by Series A QUIPS and the remainder by Series A Common Securities.
All of the Series A Common Securities will be owned by Nevada Power. The Series
A Common Securities rank PARI PASSU, and payment will be made thereon pro rata
with the Series A QUIPS based on the liquidation preference of the Series A
QUIPS and the Series A Common Securities, except that, if an Event of Default
under the Trust Agreement resulting from a Debenture Event of Default shall have
occurred and be continuing, the Series A QUIPS will have a preference over the
Series A Common Securities. The Series A QUIDS will be held by the Property
Trustee in trust for the benefit of the holders of the Series A QUIPS and Series
A Common Securities. Nevada Power has agreed in an Agreement as to Expenses and
Liabilities (the "Expense Agreement") to provide funds to the Series A Issuer as
needed to pay obligations of the Series A Issuer to parties other than the
holders of the Series A QUIPS and Series A Common Securities. The Series A QUIDS
and the Series A Guarantee, together with the obligations of Nevada Power with
respect to the Series A QUIPS under the Indenture, the Trust Agreement and the
Expense Agreement, constitute a full and unconditional guarantee, on a
subordinated basis, by Nevada Power of payments on the Series A QUIPS in
accordance with their terms. See "Description of Guarantees".
DISTRIBUTIONS
Distributions on each Series A QUIPS will be payable at the annual rate of
% of the stated liquidation preference of $25, payable quarterly in arrears on
the last day of March, June, September and December of each year. Distributions
will accumulate from , 1997, the date of original issuance. The first
Distribution payment date for the Series A QUIPS will be , 1997. The
amount of Distributions payable for any period will be computed on the basis of
a 360-day year of twelve 30-day months. In the event that any date on which
Distributions are payable on the Series A QUIPS is not a Business Day, then
payment of the Distributions payable on such date will be made on the next
succeeding day that is a Business Day (and without any additional Distributions
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 such payment was originally payable. See "Description of
QUIPS--Distributions" in the accompanying Prospectus.
So long as no Debenture Event of Default has occurred and is continuing,
Nevada Power has the right under the Indenture to defer the payment of interest
on the Series A QUIDS at any time or from time to time for a period not
exceeding 20 consecutive quarters with respect to each Extension Period,
provided that no Extension Period may extend beyond the Stated Maturity of the
Series A QUIDS. At the end of each Extension Period, Nevada Power shall pay all
interest then accrued and unpaid together with interest on all such accrued and
unpaid amounts calculated at the applicable rate. During an Extension Period,
Nevada Power may prepay any deferred interest prior to the end of an Extension
Period in whole or in part
S-12
<PAGE>
on any Interest Payment Date. Upon the termination of any Extension Period and
the payment of all payments then due on any Interest Payment Date, Nevada Power
may elect to begin a new Extension Period subject to the above requirements. If
interest payments on the Series A QUIDS are so deferred, Distributions on the
Series A QUIPS will also be deferred and Nevada Power will not be permitted, and
no subsidiary of Nevada Power will be permitted, to (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of Nevada Power's capital stock or (ii)
make any payment of principal of, or interest or premium, if any, on, or repay,
repurchase or redeem, or make any sinking fund payment with respect to, any
indebtedness that ranks PARI PASSU with or junior in right of payment to the
Series A QUIDS, or make any guarantee payments with respect to any indebtedness
if such guarantee ranks PARI PASSU with or junior in right of payment to the
Series A QUIDS (other than (a) dividends or distributions in Common Stock of
Nevada Power, (b) redemptions or purchases of any rights pursuant to Nevada
Power's Stock Purchase Rights Plan, or any successor to such Stock Purchase
Rights Plan, and the declaration of a dividend of such rights or the issuance of
Preferred Stock under such plans in the future, (c) payments under any
Guarantee, (d) purchases of Common Stock related to the issuance of Common Stock
under the Stock Purchase and Dividend Reinvestment Plan and any of Nevada
Power's benefit plans for its directors, officers or employees and (e) purchases
of Common Stock required to prevent the loss or secure the renewal or
reinstatement of any government license or franchise held by Nevada Power or any
of its subsidiaries). During an Extension Period, interest on the Series A QUIDS
will continue to accrue (and the amount of Distributions to which holders of the
Series A QUIPS are entitled will accumulate at the rate of % per annum,
compounded quarterly) and holders of Series A QUIDS will be required to accrue
interest income in the form of OID for United States federal income tax purposes
in advance of receipt of cash related to such income as described herein. See
"Certain Terms of Series A QUIDS--Option to Extend Interest Payment Period" and
"Certain Federal Income Tax Consequences--Potential Extension of Interest
Payment Period and Original Issue Discount".
Nevada Power has no current intention of exercising its right to defer
payments of interest by extending the interest payment period on the Series A
QUIDS.
REDEMPTION
Upon the repayment or redemption, in whole or in part, of the Series A
QUIDS, whether at Stated Maturity or upon earlier redemption as provided in the
Indenture, the proceeds from such repayment or redemption shall be applied by
the Property Trustee to redeem a Like Amount (as defined in the accompanying
Prospectus) of the Series A QUIPS and Series A Common Securities, upon not less
than 30 or more than 60 days notice prior to the date fixed for repayment or
redemption, at a redemption price (the "Redemption Price"), with respect to the
Series A QUIPS, equal to the aggregate liquidation preference of such Series A
QUIPS plus accumulated and unpaid Distributions thereon to the date of
redemption (the "Redemption Date"). See "Description of QUIPS--Redemption" in
the accompanying Prospectus and "Certain Terms of Series A QUIDS--Redemption".
Nevada Power will have the right to redeem the Series A QUIDS (i) on or
after , 2002, in whole at any time or in part from time to time, at a
redemption price equal to the accrued and unpaid interest on the Series A QUIDS
so redeemed to the date fixed for redemption, plus 100% of the principal amount
thereof or (ii) at any time, in whole (but not in part), upon the occurrence and
continuation of a Tax Event or an Investment Company Event (each as defined in
the accompanying Prospectus, and as so collectively defined, a "Special Event"),
at a redemption price equal to the accrued and unpaid interest on the Series A
QUIDS so redeemed to the date fixed for redemption, plus 100% of the principal
amount thereof, in each case subject to conditions described under "Description
of QUIDS--Redemption" and "Description of Corresponding QUIDS--Optional
Redemption" in the accompanying Prospectus.
S-13
<PAGE>
SPECIAL EVENT REDEMPTION OR DISTRIBUTION OF SERIES A QUIDS
If a Special Event shall have occurred and be continuing, Nevada Power will
have the right to redeem the Series A QUIDS in whole (but not in part) and
thereby cause a mandatory redemption of the Series A QUIPS in whole (but not in
part) at the Redemption Price within 90 days following the occurrence of such
Special Event. At any time, Nevada Power will have the right to terminate the
Series A Issuer and, after satisfaction of the liabilities of creditors of the
Series A Issuer as provided by applicable law, cause the Series A QUIDS to be
distributed to the holders of the Series A QUIPS in liquidation of the Series A
Issuer. Under current United States federal income tax law and interpretations
and assuming, as expected, the Series A Issuer is treated as a grantor trust, a
distribution of the Series A QUIDS should not be a taxable event to holders of
the Series A QUIPS. See "Certain Federal Income Tax Consequences-- Distribution
of Series A QUIDS to Holders of Series A QUIPS". If Nevada Power does not elect
either option described above, the Series A QUIPS will remain outstanding until
the repayment of the Series A QUIDS.
If Nevada Power elects to liquidate the Series A Issuer and thereby causes
the Series A QUIDS to be distributed to holders of the Series A QUIPS in
liquidation of the Series A Issuer, Nevada Power may shorten or extend the
maturity of such Series A QUIDS, except that it can extend the maturity only if
certain conditions are met. See "Description of QUIPS--Redemption--Extension of
Maturity of Corresponding QUIDS" in the accompanying Prospectus and "Certain
Terms of Series A QUIDS--General".
LIQUIDATION VALUE
The amount payable on the Series A QUIPS in the event of any liquidation of
the Series A Issuer is $25 per Series A QUIPS plus accumulated and unpaid
Distributions, which may be in the form of a distribution of such amount in
Series A QUIDS, subject to certain exceptions. See "Description of
QUIPS--Liquidation Distribution Upon Termination" in the accompanying
Prospectus.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Series A QUIPS will be made by the Underwriters in
immediately available funds. All payments of principal and interest will be made
by the Series A Issuer in immediately available funds. Secondary trading in
preferred securities of corporate issuers is generally settled in clearinghouse
or next-day funds. In contrast, the Series A QUIPS will trade in DTC's Same-Day
Funds Settlement System until maturity or until the Series A QUIPS are issued in
certificated form, and secondary market trading activity in the Series A QUIPS
will therefore be required by DTC to settle in immediately available funds. No
assurance can be given as to the effect, if any, of settlement in immediately
available funds on trading activity in the Series A QUIPS.
CERTAIN TERMS OF SERIES A QUIDS
The following summary of certain terms and provisions of the Series A QUIDS
supplements the description of the terms and provisions of the Corresponding
QUIDS set forth in the accompanying Prospectus under the headings "Description
of QUIDS" and "Description of Corresponding QUIDS", to which description
reference is hereby made. The summary of certain terms and provisions of the
Series A QUIDS set forth below does not purport to be complete and is subject
to, and qualified in its entirety by reference to, the Indenture. The Indenture
has been filed as an exhibit to the Registration Statement of which this
Prospectus Supplement and accompanying Prospectus is a part.
GENERAL
Concurrently with the issuance of the Series A QUIPS, the Series A Issuer
will invest the proceeds thereof and the consideration paid by Nevada Power for
the Series A Common Securities in the Series A QUIDS issued by Nevada Power. The
Series A QUIDS will bear interest at the annual rate of % of the
S-14
<PAGE>
principal amount thereof, payable quarterly in arrears on the last day of March,
June, September and December of each year (each, an "Interest Payment Date"),
commencing , 1997, to the person in whose name each Series A QUIDS is
registered, subject to certain exceptions, at the close of business on the
Business Day next preceding such Interest Payment Date. It is anticipated that,
until the liquidation, if any, of the Series A Issuer, each Series A QUIDS will
be held in the name of the Property Trustee in trust for the benefit of the
holders of the Series A QUIPS. The amount of interest payable for any period
will be computed on the basis of a 360-day year of twelve 30-day months. In the
event that any date on which interest is payable on the Series A QUIDS is not a
Business Day, then payment of the interest payable on such date will be made on
the next succeeding day that 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 such payment was originally payable. Accrued interest
that is not paid on the applicable Interest Payment Date will bear additional
interest on the amount thereof (to the extent permitted by law) at the rate per
annum of % thereof, compounded quarterly. The term "interest" as used herein
shall include quarterly interest payments, interest on quarterly interest
payments not paid on the applicable Interest Payment Date and Additional Sums
(as defined below), as applicable.
The Series A QUIDS will be issued as a series of QUIDS under the Indenture.
The Series A QUIDS will mature on , 2037, which date may be extended
at any time at the election of Nevada Power for one or more periods, but in no
event to a date later than , 2046 (such date, as it may be extended,
the "Stated Maturity"), provided that at the time such election is made and at
the time of extension (i) Nevada Power is not in bankruptcy, otherwise insolvent
or in liquidation, (ii) Nevada Power is not in default in the payment of any
interest or principal on the Series A QUIDS, (iii) the Series A Issuer is not in
arrears on payments of Distributions on the Series A QUIPS and no deferred
Distributions are accumulated, (iv) the Series A QUIDS are rated not less than
BBB- by Standard & Poor's Ratings Services or Baa3 by Moody's Investors Service,
Inc. or the equivalent by any other nationally recognized statistical rating
organization and (v) the extended Stated Maturity is no later than the 49th
anniversary of the initial issuance of the Series A QUIPS; PROVIDED, HOWEVER,
that, if Nevada Power exercises its right to liquidate the Series A Issuer and
distribute the Series A QUIDS, effective upon such exercise the Stated Maturity
of the Series A QUIDS may be changed to any date elected by Nevada Power that is
(i) no earlier than the date five years after the initial issuance of the Series
A QUIPS and (ii) no later than the date 40 years (plus an extended term of up to
an additional 9 years if the above-referenced conditions are satisfied) after
the date of the initial issuance of the Series A QUIPS.
The Series A QUIDS will be unsecured and will rank junior and be subordinate
in right of payment to all Senior Debt of Nevada Power. The Indenture does not
limit the incurrence or issuance of other secured or unsecured debt of Nevada
Power, whether under the Indenture or any existing or other indenture that
Nevada Power may enter into in the future or otherwise, including, without
limitation, Nevada Power's Indenture of Mortgage and Deed of Trust dated October
1, 1953 entered into with Banker's Trust Company, together with supplemental
indentures thereto heretofore or hereafter entered into (the "Mortgage
Indenture"). At December 31, 1996, the aggregate principal amount of
indebtedness outstanding under the Mortgage Indenture was $443 million, all of
which is secured by a first mortgage lien and security interest in substantially
all of the tangible property of Nevada Power. See "Description of
QUIDS--Subordination" in the accompanying Prospectus.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
So long as no Debenture Event of Default has occurred and is continuing,
Nevada Power has the right under the Indenture to defer the payment of interest
at any time or from time to time for a period not exceeding 20 consecutive
quarters with respect to each Extension Period, provided that no Extension
Period may extend beyond the Stated Maturity of the Series A QUIDS. At the end
of such Extension Period, Nevada Power must pay all interest then accrued and
unpaid (together with interest thereon at the
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<PAGE>
annual rate of %, compounded quarterly, to the extent permitted by applicable
law). During an Extension Period, Nevada Power may prepay any deferred interest
prior to the end of an Extension Period in whole or in part on any Interest
Payment Date. During an Extension Period, interest will continue to accrue and
holders of Series A QUIDS (or holders of Series A QUIPS while such series is
outstanding) will be required to accrue interest income in the form of OID for
United States federal income tax purposes as described herein. See "Certain
Federal Income Tax Consequences--Payments of Interest" and "Potential Extension
of Interest Payment Period and Original Issue Discount".
During any such Extension Period, Nevada Power may not, and may not permit
any subsidiary of Nevada Power to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of Nevada Power's capital stock or (ii) make any payment of
principal of, or interest or premium, if any, on or repay, repurchase or redeem,
or make any sinking fund payment with respect to, any indebtedness of Nevada
Power (including other QUIDS) that rank PARI PASSU with or junior in right of
payment, to the Series A QUIDS or make any guarantee payments with respect to
any indebtedness if such guarantee ranks PARI PASSU with or junior in right of
payment to the Series A QUIDS (other than (a) dividends or distributions in
common stock of Nevada Power, (b) redemptions or purchases of any rights
pursuant to Nevada Power's Stock Purchase Rights Plan, or any successor to such
Stock Purchase Rights Plan, and the declaration of a dividend of such rights or
the issuance of Preferred Stock under such plans in the future, (c) payments
under any Guarantee, (d) purchases of Common Stock related to the issuance of
Common Stock under Nevada Power's Stock Purchase and Dividend Reinvestment Plan
and any of Nevada Power's benefit plans for its directors, officers or employees
and (e) purchases of Common Stock required to prevent the loss or secure the
renewal or reinstatement of any government license or franchise held by Nevada
Power or any of its subsidiaries). Prior to the termination of any such
Extension Period, Nevada Power may further extend the interest payment period,
provided that no Extension Period may exceed 20 consecutive quarters or extend
beyond the Stated Maturity of the Series A QUIDS. Upon the termination of any
such Extension Period and the payment of all amounts then due on any Interest
Payment Date, Nevada Power may elect to begin 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. Nevada Power must give the Property Trustee,
the Administrative Trustees and the Debenture Trustee notice of its election of
such Extension Period at least one Business Day prior to the earlier of (i) the
date the Distributions on the Series A QUIPS would have been payable except for
the election to begin such Extension Period or (ii) the date the Administrative
Trustees are required to give notice to the NYSE or other applicable
self-regulatory organization or to holders of such Series A QUIPS of the record
date or the date such Distributions are payable, but in any event not less than
one Business Day prior to such record date. The Debenture Trustee shall give
notice of Nevada Power's election to begin a new Extension Period to the holders
of the Series A QUIPS. See "Description of QUIDS--Option to Extend Interest
Payment Date" in the accompanying Prospectus.
ADDITIONAL SUMS
If the Series A Issuer is required to pay any additional taxes, duties or
other governmental charges ("Additional Sums") as a result of a Tax Event,
Nevada Power will pay as additional amounts on the Series A QUIDS such amounts
as shall be required so that the Distributions payable by the Series A Issuer
shall not be reduced as a result of any such additional taxes, duties or other
governmental charges, subject to the conditions described under "Description of
QUIPS--Redemption--Special Event Redemption or Distribution of Corresponding
QUIDS" in the accompanying Prospectus.
REDEMPTION
The Series A QUIDS are redeemable prior to maturity at the option of Nevada
Power (i) on or after , 2002, in whole at any time or in part from
time to time, at a redemption price equal to the accrued and unpaid interest on
the Series A QUIDS so redeemed to the date fixed for redemption, plus
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<PAGE>
100% of the principal amount thereof or (ii) at any time in whole (but not in
part), upon the occurrence and continuation of a Special Event, at a redemption
price equal to the accrued and unpaid interest on the Series A QUIDS so redeemed
to the date fixed for redemption, plus 100% of the principal amount thereof, in
each case subject to the further conditions described under "Description of
QUIDS-- Redemption" and "Description of Corresponding QUIDS--Optional
Redemption" in the accompanying Prospectus.
DISTRIBUTIONS OF SERIES A QUIDS
Under certain circumstances involving the termination of the Series A
Issuer, Series A QUIDS may be distributed to the holders of the Series A QUIPS
in liquidation of the Series A Issuer after satisfaction of liabilities to
creditors of the Series A Issuer as provided by applicable law. If distributed
to holders of Series A QUIPS in liquidation, the Series A QUIDS will initially
be issued in the form of one or more global securities and DTC, or any successor
depositary for the Series A QUIPS, will act as depositary for the Series A
QUIDS. It is anticipated that the depositary arrangements for the Series A QUIDS
would be substantially identical to those in effect for the Series A QUIPS. If
the Series A QUIDS are distributed to the holders of Series A QUIPS upon the
liquidation of the Series A Issuer, Nevada Power will use its best efforts to
list the Series A QUIDS on the NYSE or such other stock exchanges, if any, on
which the Series A QUIPS are then listed. There can be no assurance as to the
market price of any Series A QUIDS that may be distributed to the holders of
Series A QUIPS. For a description of DTC and the terms of the depositary
matters, see "Description of QUIPS--Book-Entry Issuance" in the accompanying
Prospectus.
REGISTRATION OF SERIES A QUIDS
A global security shall be exchangeable for Series A QUIDS registered in the
names of persons other than DTC or its nominee only if (i) DTC notifies Nevada
Power that it is unwilling or unable to continue as a depository for such global
security and no successor depository shall have been appointed, or if at any
time DTC ceases to be a clearing agency registered under the Securities Exchange
Act of 1934, as amended, at a time when DTC is required to be so registered to
act as such depository, (ii) Nevada Power in its sole discretion determines that
such global security shall be so exchangeable, or (iii) there shall have
occurred and be continuing an Event of Default with respect to such global
security. Any global security that is exchangeable pursuant to the preceding
sentence shall be exchangeable for definitive certificates registered in such
names as DTC shall direct. It is expected that such instructions will be based
upon directions received by DTC from its Participants (as defined in the
accompanying Prospectus) with respect to ownership of beneficial interests in
such global security. In the event that Series A QUIDS are issued in definitive
form, such Series A QUIDS will be in denominations of $25 and integral multiples
thereof and may be transferred or exchanged at the offices described below.
Payments on Series A QUIDS represented by a global security will be made to
DTC, as the depositary for the Series A QUIDS. In the event Series A QUIDS are
issued in definitive form, principal and interest will be payable, the transfer
of the Series A QUIDS will be registrable, and Series A QUIDS will be
exchangeable for Series A QUIDS of other denominations of a like aggregate
principal amount, at the corporate office of the Debenture Trustee in New York,
New York, or at the offices of any paying agent or transfer agent appointed by
Nevada Power, provided that payment of interest may be made at the option of
Nevada Power by check mailed to the address of the persons entitled thereto or
by wire transfer. In addition, if the Series A QUIDS are issued in certificated
form, the record dates for payment of interest will be the 15th day of the last
month of each calendar quarter. For a description of DTC and the terms of the
depositary arrangements relating to payments, transfers, voting rights,
redemptions and other notices and other matters, see "Description of
QUIPS--Book-Entry Issuance" in the accompanying Prospectus.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of the principal United States federal income tax
consequences of the purchase, ownership and disposition of Series A QUIPS. This
summary only addresses the United States federal tax consequences to a person
that acquires Series A QUIPS on their original issue at their original offering
price and that is (i) an individual citizen or resident of the United States,
(ii) a corporation or
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<PAGE>
partnership organized in or under the laws of the United States or any state
thereof or the District of Columbia or (iii) an estate or trust the income of
which is subject to United States federal income tax regardless of source (a
"United States Person"). This summary does not address all tax consequences that
may be applicable to a United States Person that is a beneficial owner of Series
A QUIPS, and it does not address the tax consequences to (i) persons that are
not United States Persons, (ii) persons that may be subject to special treatment
under United States federal income tax law, such as banks, insurance companies,
thrift institutions, regulated investment companies, real estate investment
trusts, tax-exempt organizations and dealers in securities or currencies, (iii)
persons that will hold Series A QUIPS as part of a position in a "straddle" or
as part of a "hedging", "conversion" or other integrated investment transaction
for federal income tax purposes, (iv) persons whose functional currency is not
the United States dollar or (v) persons that do not hold Series A QUIPS as
capital assets. Furthermore, it does not address the effect of any state, local
or foreign laws.
The statements of law or legal conclusion set forth in this summary
constitute the opinion of Jones, Day, Reavis & Pogue, special tax counsel to
Nevada Power and the Series A Issuer. Jones, Day, Reavis & Pogue is also acting
as counsel to the Underwriters named herein. This summary is based upon the
Internal Revenue Code of 1986, as amended (the "Code"), Treasury Regulations,
Internal Revenue Service rulings and pronouncements and judicial decisions now
in effect, all of which are subject to change at any time. Such changes may be
applied retroactively in a manner that could cause the tax consequences to vary
substantially from the consequences described below, possibly adversely
affecting a beneficial owner of Series A QUIPS. In particular, legislation has
been proposed that could adversely affect Nevada Power's ability to deduct
interest on the Series A QUIDS, which may in turn permit Nevada Power to cause a
redemption of the Series A QUIPS. See "--Possible Tax Law Changes". The
authorities on which this summary is based are subject to various
interpretations and it is therefore possible that the federal income tax
treatment of the purchase, ownership and disposition of Series A QUIPS may
differ from the treatment described below.
PROSPECTIVE INVESTORS ARE ADVISED TO CONSULT WITH THEIR OWN TAX ADVISORS IN
LIGHT OF THEIR OWN PARTICULAR CIRCUMSTANCES AS TO THE FEDERAL TAX CONSEQUENCES
OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF SERIES A QUIPS, AS WELL AS THE
EFFECT OF ANY STATE, LOCAL OR FOREIGN TAX LAWS.
CLASSIFICATION OF THE SERIES A ISSUER
Under current law and assuming compliance with the terms of the Trust
Agreement and certain other documents, the Series A Issuer will be classified as
a grantor trust and not as an association taxable as a corporation for United
States federal income tax purposes. As a result, each beneficial owner of Series
A QUIPS (a "Securityholder") will be treated as owning an undivided beneficial
interest in the Series A QUIDS. Accordingly, each Securityholder will be
required to include in its gross income its PRO RATA share of the interest
income, including any original issue discount ("OID"), paid or accrued with
respect to the Series A QUIDS whether or not cash is actually distributed to the
Securityholders. See "--Payments of Interest" and "--Potential Extension of
Interest Payment Period and Original Issue Discount".
PAYMENTS OF INTEREST
Except as set forth below, stated interest on Series A QUIDS will generally
be taxable to a United States Person as ordinary income at the time it is paid
or accrued in accordance with the United States Person's method of accounting
for tax purposes.
POTENTIAL EXTENSION OF INTEREST PAYMENT PERIOD AND ORIGINAL ISSUE DISCOUNT
Under recently issued Treasury regulations (the "Regulations"), a "remote"
contingency that stated interest will not be timely paid will be ignored in
determining whether a debt instrument is issued with
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<PAGE>
OID. Nevada Power believes that the likelihood of it exercising its option to
defer interest payments is remote. Based on the foregoing, Nevada Power believes
that the Series A QUIDS will not be considered to be issued with OID at the time
of their original issuance and, accordingly, each Securityholder will be
required to include interest payments in taxable income at the time accrued or
received in accordance with its own method of accounting.
However, if Nevada Power were to exercise its right to defer payments of
interest thereon, the Series A QUIDS would be considered to be retired and
reissued for their adjusted issue price at such time, and the Series A QUIDS
thereafter would be considered to have been issued with OID. Securityholders
would include that discount in income on an economic accrual basis before the
receipt of cash attributable to the interest, regardless of their method of tax
accounting, and actual distributions of stated interest would not be reported as
taxable income. Accordingly, a Securityholder of Series A QUIPS would be
required to include in gross income OID even if Nevada Power did not make any
actual cash payments during an Extension Period.
As of the date of this Prospectus Supplement, the Regulations have not been
addressed in any rulings or other interpretations by the Internal Revenue
Service (the "IRS"), and it is possible that the IRS could take a position
contrary to the interpretation herein.
Because income on the Series A QUIPS will constitute interest or OID,
corporate Securityholders will not be entitled to a dividends-received deduction
with respect to any income recognized with respect to the Series A QUIPS.
Subsequent uses of the term "interest" in this summary include income in the
form of OID.
DISTRIBUTION OF SERIES A QUIDS TO HOLDERS OF SERIES A QUIPS
As described under the caption "Certain Terms of Series A QUIPS--
Redemption--Special Event Redemption or Distribution of Series A QUIDS", Series
A QUIDS may be distributed to Securityholders in exchange for Series A QUIPS and
in liquidation of the Series A Issuer. Under current law, for United States
federal income tax purposes, such a distribution will be non-taxable and will
result in the Securityholder receiving directly his PRO RATA share of the Series
A QUIDS previously held indirectly through the Series A Issuer, with a holding
period and aggregate tax basis equal to the holding period and aggregate tax
basis such Securityholder had in its Series A QUIPS before such distribution. A
Securityholder will be considered to receive interest in respect of Series A
QUIDS received from the Series A Issuer in the manner described above under
"--Payments of Interest" and "--Potential Extension of Interest Payment Period
and Original Issue Discount".
SALES OR REDEMPTION OF SERIES A QUIPS
A Securityholder that sells (including a redemption for cash) Series A QUIPS
will recognize gain or loss equal to the difference between its adjusted tax
basis in the Series A QUIPS and the amount realized on the sale of such Series A
QUIPS. Assuming that Nevada Power does not exercise its option to defer payment
of interest on the Series A QUIDS, a Securityholder's adjusted tax basis in the
Series A QUIPS generally will be its initial purchase price. If the Series A
QUIDS are deemed to be issued with OID as a result of Nevada Power's deferral of
any interest payment, a Securityholder's tax basis in the Series A QUIPS
generally will be its initial purchase price, increased by OID previously
includible in such Securityholder's gross income to the date of disposition and
decreased by distributions or other payments received on the Series A QUIPS
since and including the date of the first Extension Period. Such gain or loss
generally will be a capital gain or loss (except to the extent any amount
realized is treated as a payment of accrued interest with respect to such
holder's pro rata share of Series A QUIDS required to be included in income) and
generally will be a long-term capital gain or loss if the Series A QUIPS have
been held for more than one year.
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<PAGE>
Should Nevada Power exercise its option to defer any payment of interest on
the Series A QUIPS, the Series A QUIPS may trade at a price that does not
accurately reflect the value of accrued but unpaid interest with respect to the
underlying Series A QUIDS. Should an Extension Period occur, a Securityholder
that disposes of its Series A QUIPS between record dates for payments of
Distributions will nevertheless be required to include in income as ordinary
income accrued but unpaid interest on such holder's pro rata share of the
underlying Series A QUIDS to the date of disposition as OID and to add such
amount to its adjusted tax basis in its pro rata share of the underlying Series
A QUIDS deemed disposed of. Such Securityholder will recognize a capital loss on
the disposition of its Series A QUIPS to the extent the selling price is less
than the Securityholder's adjusted tax basis in the Series A QUIPS. Subject to
certain limited exceptions, capital losses cannot be applied to offset ordinary
income for federal income tax purposes.
BACKUP WITHHOLDING TAX AND INFORMATION REPORTING
The amount of OID accrued on the Series A QUIPS held of record by United
States Persons (other than corporations and other exempt Securityholders) will
be reported to the Internal Revenue Service. "Backup" withholding at a rate of
31% will apply to payments of interest to non-exempt United States Persons
unless the Securityholder furnishes its taxpayer identification number in the
manner prescribed in applicable Treasury Regulations, certifies that such number
is correct, certifies as to no loss of exemption from backup withholding and
meets certain other conditions.
Payment of the proceeds from the disposition of Series A QUIPS to or through
the United States office of a broker is subject to information reporting and
backup withholding unless the holder or beneficial owner establishes an
exemption from information reporting and backup withholding.
Any amounts withheld from a Securityholder under the backup withholding
rules will be allowed as a refund or a credit against such Securityholder's
United States federal income tax liability, provided the required information is
furnished to the Internal Revenue Service.
POSSIBLE TAX LAW CHANGES
On March 19, 1996, the Revenue Reconciliation Bill of 1996 (the "Bill"), the
revenue portion of President Clinton's budget proposal, was released. The Bill
would, among other things, generally have denied interest deductions for
interest on an instrument, issued by a corporation, that had a maximum weighted
average maturity of more than 40 years. The Bill would also generally have
denied interest deductions for interest on an instrument, issued by a
corporation, that had a maximum term of more than 20 years and that was not
shown as indebtedness on the separate balance sheet of the issuer or, where the
instrument was issued to a related party (other than a corporation), where the
holder or some other related party issues a related instrument that was not
shown as indebtedness on the issuer's consolidated balance sheet. For purposes
of determining the weighted average maturity or the term of an instrument, any
right to extend would have been treated as exercised. The above-described
provisions of the Bill were proposed to be effective generally for instruments
issued on or after December 7, 1995. If either provision were to apply to the
Series A QUIDS, Nevada Power would be unable to deduct interest on the Series A
QUIDS. However, on March 29, 1996, the Chairmen of the Senate Finance and House
Ways and Means Committees issued a joint statement to the effect that it was
their intention that the effective date of the President's legislative
proposals, if adopted, would be no earlier than the date of appropriate
Congressional action.
Nevada Power believes that, under current law, it will be able to deduct
interest on the Series A QUIDS. Although the session of Congress in which the
Bill was introduced adjourned without enacting the Bill, there can be no
assurance that future legislation will not be introduced and enacted which would
adversely affect the ability of Nevada Power to deduct interest on the Series A
QUIDS or otherwise affect the tax treatment of the transaction described herein.
A change in the deductibility of interest and certain
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<PAGE>
other changes could give rise to a Tax Event, which may permit Nevada Power to
cause a redemption of the Series A QUIPS, as described more fully in the
accompanying Prospectus under "Description of QUIPS-- Redemption--Special Event
Redemption or Distribution of Corresponding QUIDS".
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement,
Nevada Power and the Series A Issuer have agreed that the Series A Issuer will
sell to each of the Underwriters named below, and each of such Underwriters, for
whom Goldman, Sachs & Co., , , and
are acting as representatives, has severally agreed to purchase
from the Series A Issuer the respective number of Series A QUIPS set forth
opposite its name below:
<TABLE>
<CAPTION>
NUMBER OF
SERIES A
UNDERWRITER QUIPS
- ----------------------------------------------------------------------------------------------------- ----------
<S> <C>
Goldman, Sachs & Co..................................................................................
----------
Total............................................................................................ 5,000,000
----------
----------
</TABLE>
Subject to the terms and conditions set forth in the Underwriting Agreement,
the Underwriters are committed to take and pay for all such Series A QUIPS
offered hereby, if any are taken.
The Underwriters propose to offer the Series A QUIPS in part directly to the
public at the initial public offering price set forth on the cover page of this
Prospectus Supplement and in part to certain securities dealers at such price
less a concession of $ per Series A QUIPS. The Underwriters may allow, and
such dealers may reallow, a concession not to exceed $ per Series A QUIPS
to certain brokers and dealers. After the Series A QUIPS 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 from the sale of the Series A QUIPS
will be used to purchase the Series A QUIDS issued by Nevada Power, the
Underwriting Agreement provides that Nevada Power will pay as Underwriters'
compensation for the Underwriters' arranging the investment therein of such
proceeds an amount of $ per Series A QUIPS for the accounts of the several
Underwriters.
Nevada Power and the Series A Issuer have agreed that, during the period
beginning from the date of the Underwriting Agreement and continuing to and
including the earlier of (i) the termination of trading restrictions on the
Series A QUIPS, as determined by the Underwriters, and (ii) 30 days after the
closing date, they will not offer, sell, contract to sell or otherwise dispose
of any QUIPS, any other beneficial interests in the assets of the Series A
Issuer, or any preferred securities or any other securities of the Series A
Issuer or Nevada Power which are substantially similar to the Series A QUIPS,
including any guarantee of such securities, or any securities convertible into
or exchangeable for or representing the right to receive securities, preferred
securities or any such substantially similar securities of either the Series A
Issuer or Nevada Power, without the prior written consent of the
representatives, except for the Series A QUIPS and the Series A Guarantee
offered in connection with the offering.
Prior to this offering, there has been no public market for the Series A
QUIPS. Application will be made to list the Series A QUIPS on the NYSE under the
symbol " ". In order to meet one of the requirements for listing the Series
A QUIPS on the NYSE, the Underwriters will undertake to sell lots of 100 or more
Series A QUIPS to a minimum of 400 beneficial holders. Trading of the Series A
QUIPS on the NYSE is expected to commence within 30 days after the initial
delivery of the Series A QUIPS. The representatives of the Underwriters have
advised Nevada Power that they intend to make a market in the Series A QUIPS
prior to commencement of trading on the NYSE, but are not obligated to do so and
may
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<PAGE>
discontinue market making at any time without notice. No assurance can be given
as to the liquidity of the trading market for the Series A QUIPS.
Nevada Power and the Series A Issuer have agreed to indemnify the several
Underwriters against and contribute toward certain liabilities, including
liabilities under the Securities Act of 1933, as amended.
Certain of the Underwriters or their affiliates have provided from time to
time, and expect to provide in the future, investment or commercial banking
services to Nevada Power and its affiliates, for which such Underwriters or
their affiliates have received or will receive customary fees and commissions.
LEGAL MATTERS
Certain matters of Delaware law relating to the legality of the Series A
QUIPS, the validity of the Trust Agreement and the formation of the Series A
Issuer will be passed upon by Richards, Layton & Finger, special Delaware
Counsel to Nevada Power and the Series A Issuer. The legality of the Series A
Guarantee and the Series A QUIDS will be passed upon for Nevada Power by Mr.
Richard L. Hinckley, Vice President, Secretary and Chief Counsel for Nevada
Power and by Best Best & Krieger LLP. Certain legal matters will be passed upon
for the Underwriters by Jones, Day, Reavis & Pogue, Chicago, Illinois. Certain
matters relating to United States federal income tax considerations will be
passed upon for Nevada Power and the Series A Issuer by their special tax
counsel, Jones, Day, Reavis & Pogue, Chicago, Illinois. For the purposes of
their opinions, Best Best & Krieger LLP and Jones Day Reavis & Pogue may rely on
the opinion of Mr. Hinckley as to matters governed by the laws of the State of
Nevada.
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<PAGE>
SUBJECT TO COMPLETION, DATED FEBRUARY 4, 1997
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.
<PAGE>
$125,000,000
<TABLE>
<S> <C>
NEVADA POWER COMPANY NVP CAPITAL I
JUNIOR SUBORDINATED DEFERRABLE NVP CAPITAL II
INTEREST DEBENTURES PREFERRED SECURITIES GUARANTEED TO THE EXTENT
THE ISSUER HAS FUNDS AS SET FORTH HEREIN BY
</TABLE>
NEVADA POWER COMPANY
Nevada Power Company, a Nevada corporation ("Nevada Power"), may from time
to time offer in one or more series or issuances its junior subordinated
deferrable interest debentures (the "QUIDS"). The QUIDS will be unsecured and
subordinate and junior in right of payment to Senior Debt (as defined in
"Description of QUIDS Subordination") of Nevada Power. If provided in an
accompanying Prospectus Supplement, Nevada Power will have the right to defer
payments of interest on any series of QUIDS at any time or from time to time for
such number of consecutive interest payment periods (which shall not extend
beyond the maturity of the QUIDS) with respect to each deferral period as may be
specified in such Prospectus Supplement (each, an "Extension Period"). See
"Description of QUIDS--Option to Extend Interest Payment Date".
NVP Capital I and NVP Capital II, each a trust formed under the laws of the
State of Delaware (each, an "Issuer", and collectively, the "Issuers"), may
severally offer, from time to time, preferred securities (the "QUIPS")
representing preferred undivided beneficial interests in the assets of such
Issuer. Nevada Power will be the owner of the common securities (the "Common
Securities") of each Issuer. The payment of periodic cash distributions
("Distributions") with respect to the QUIPS of each Issuer and payments on
liquidation or redemption with respect to such QUIPS, in each case to the extent
of funds held by such Issuer, are each irrevocably guaranteed by Nevada Power as
described herein (each, a "Guarantee"). See "Description of Guarantees". The
obligations of Nevada Power under each Guarantee will be subordinate and junior
in right of payment to all Senior Debt of Nevada Power. Concurrently with the
issuance by an Issuer of its QUIPS, such Issuer will invest the proceeds thereof
and any contributions made by Nevada Power in respect of Nevada Power's purchase
of the Common Securities in a corresponding series of Nevada Power's QUIDS (the
"Corresponding QUIDS") with terms corresponding to the terms of that Issuer's
QUIPS. The Corresponding QUIDS will be the sole assets of each Issuer, and
payments under the Corresponding QUIDS and the Expense Agreement (as defined
herein) will be the only revenue of each Issuer. Nevada Power may redeem the
Corresponding QUIDS (and cause the redemption of the related QUIPS) or may
terminate each Issuer and cause the Corresponding QUIDS to be distributed to the
holders of QUIPS in liquidation of their interests in such Issuer. See
"Description of QUIPS--Liquidation Distribution Upon Termination".
Holders of the QUIPS will be entitled to receive preferential cumulative
cash Distributions accumulating from the date of original issuance and payable
periodically as specified in an accompanying Prospectus Supplement. If provided
in an accompanying Prospectus Supplement, Nevada Power will have the right to
defer payments of interest on any series of Corresponding QUIDS at any time or
from time to time for one or more Extension Periods (which shall not extend
beyond the Stated Maturity of the
(CONTINUED ON NEXT PAGE)
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE
PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
------------------------
The date of this Prospectus is , 1997.
<PAGE>
(CONTINUED FROM PREVIOUS PAGE)
Corresponding QUIDS). If interest payments are so deferred, Distributions on the
corresponding series of QUIPS will also be deferred, and Nevada Power will not
be permitted, and its subsidiaries will not be permitted, subject to certain
exceptions set forth herein, to declare or pay any cash distributions with
respect to Nevada Power's common stock or debt securities that rank PARI PASSU
with or junior to the Corresponding QUIDS. During an Extension Period, interest
on the Corresponding QUIDS will continue to accrue (and the amount of
Distributions to which holders of the QUIPS are entitled will accumulate at the
rate per annum set forth in the related Prospectus Supplement). See "Description
of QUIPS-- Distributions".
Taken together, Nevada Power's obligations under each series of QUIDS, the
Indenture, the related Trust Agreement, the related Expense Agreement and the
related Guarantee (each, as defined herein), in the aggregate, provide a full,
irrevocable and unconditional guarantee, on a subordinated basis, of payments of
distributions and other amounts due on the related series of QUIPS. See
"Relationship Among the QUIPS, the Corresponding QUIDS and the Guarantees".
The QUIDS and QUIPS may be offered in amounts, at prices and on terms to be
determined at the time of offering, provided that the aggregate initial public
offering price of all QUIDS (other than Corresponding QUIDS) and QUIPS issued
pursuant to the Registration Statement of which this Prospectus forms a part
shall not exceed $125,000,000. Certain specific terms of the QUIDS or QUIPS in
respect of which this Prospectus is being delivered will be described in an
accompanying Prospectus Supplement, including without limitation and where
applicable and to the extent not set forth herein, (a) in the case of QUIDS, the
specific designation, aggregate principal amount, denominations, maturity
(including any extension thereof), interest payment dates, interest rate (which
may be fixed or variable) or method of calculating interest, if any, applicable
Extension Period or interest deferral terms, if any, place or places where
principal, premium, if any, and interest, if any, will be payable, terms of
redemption, if any, sinking fund provisions, if any, terms for conversion or
exchange, if any, into other securities, initial offering or purchase price,
methods of distribution and any other special terms, and (b) in the case of
QUIPS, the identity of the Issuer, specific title, aggregate amount, stated
liquidation preference, number of securities, Distribution rate or method of
calculating such rate, applicable Extension Period or Distribution deferral
terms, if any, Distribution dates, place or places where Distributions will be
payable, any terms of redemption, exchange, initial offering or purchase price,
methods of distribution and any other special terms.
The Prospectus Supplement also will contain information, as applicable,
about certain United States federal income tax consequences relating to the
QUIDS and QUIPS.
The QUIDS and QUIPS may be sold to or through underwriters, through dealers,
remarketing firms or agents or directly to purchasers. See "Plan of
Distribution". The names of any underwriters, dealers, remarketing firms or
agents involved in the sale of QUIDS or QUIPS in respect of which this
Prospectus is being delivered and any applicable fee, commission or discount
arrangements with them will be set forth in a Prospectus Supplement. The
Prospectus Supplement will state whether the QUIDS or QUIPS will be listed on
any national securities exchange. If the QUIDS or QUIPS are not listed on any
national securities exchange, there can be no assurance that there will be a
liquid secondary market for the QUIDS or QUIPS.
This Prospectus may not be used to consummate sales of QUIDS or QUIPS unless
accompanied by a Prospectus Supplement.
------------------------
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS OR
ANY ACCOMPANYING PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY NEVADA
2
<PAGE>
POWER, ANY OF THE ISSUERS OR ANY UNDERWRITER, DEALER OR AGENT. NEITHER THE
DELIVERY OF THIS PROSPECTUS OR ANY ACCOMPANYING PROSPECTUS SUPPLEMENT NOR ANY
SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN
IMPLICATION THAT THE INFORMATION CONTAINED HEREIN OR IN ANY ACCOMPANYING
PROSPECTUS SUPPLEMENT IS CORRECT AS OF ANY DATE SUBSEQUENT TO THE DATE HEREOF OR
THEREOF OR THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF NEVADA POWER SINCE
THE DATE HEREOF OR THEREOF. NEITHER THIS PROSPECTUS NOR ANY ACCOMPANYING
PROSPECTUS SUPPLEMENT CONSTITUTES AN OFFER TO SELL OR A SOLICITATION OF AN OFFER
TO BUY ANY SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS
NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT
QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION.
AVAILABLE INFORMATION
Nevada Power is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). Reports, proxy statements and other information
filed by Nevada Power with the Commission pursuant to the informational
requirements of the Exchange Act may be inspected and copied at the public
reference facilities maintained by the Commission at Room 1024, 450 Fifth
Street, N.W., Judiciary Plaza, Washington, D.C. 20549, and at the following
Regional Offices of the Commission: Suite 1400, 500 West Madison Street,
Chicago, Illinois 60661; and 7 World Trade Center, 13th Floor, New York, New
York 10048. Copies of such material can be obtained at prescribed rates from the
Public Reference Section of the Commission at 450 Fifth Street, N.W., Judiciary
Plaza, Washington, D.C. 20549. The Commission maintains a Web Site that contains
reports, proxy and information statements and other information regarding
registrants, including Nevada Power, that file electronically with the
Commission and that is located at http://www.sec.gov.
Nevada Power's common stock is listed on the New York Stock Exchange
(Symbol: "NVP") and the Pacific Stock Exchange. Reports, proxy statements and
other information concerning Nevada Power may be inspected at the offices of
such exchanges.
Nevada Power and the Issuers have filed with the Commission a Registration
Statement on Form S-3 (together with all amendments and exhibits thereto, the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Securities Act"), with respect to the securities offered hereby. This
Prospectus and the accompanying Prospectus Supplement omit, in accordance with
the rules and regulations of the Commission, certain of the information
contained in the Registration Statement. Reference is hereby made to the
Registration Statement and the exhibits and the financial statements, notes and
schedules filed as a part thereof or incorporated by reference therein for
further information with respect to Nevada Power, the Issuers and the securities
offered hereby. Statements contained herein concerning the provisions of any
document are not necessarily complete and, in each instance, where a copy of
such document has been filed as an exhibit to the Registration Statement or
otherwise has been filed with the Commission, reference is made to the copy so
filed. Each such statement is qualified in its entirety by such reference.
No separate financial statements of either Issuer have been included herein.
Nevada Power and the Issuers do not consider that such financial statements
would be material to holders of the QUIPS because each Issuer is a newly formed
special purpose entity, has no operating history or independent operations and
is not engaged in and does not propose to engage in any activity other than
holding as trust assets the Corresponding QUIDS of Nevada Power and issuing the
QUIPS and Common Securities. See "The Issuers", "Description of QUIPS",
"Description of Guarantees" and "Description of Corresponding QUIDS".
3
<PAGE>
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
Nevada Power's Annual Report on Form 10-K for the fiscal year ended December
31, 1995 and Quarterly Reports on Form 10-Q for the quarters ended March 31,
June 30 and September 30, 1996, previously filed by Nevada Power with the
Commission, are incorporated by reference in this Prospectus and shall be deemed
to be a part hereof.
Each document filed by Nevada Power with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of any offering of securities made by
this Prospectus shall be deemed to be incorporated herein by reference and to be
a part hereof from the date of filing such document. Any statement contained
herein, or in a document all or a portion of which is incorporated or deemed to
be incorporated by reference herein, shall be deemed to be modified or
superseded for purposes of the Registration Statement and this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or 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 the Registration Statement or this Prospectus.
Nevada Power will provide without charge to any person to whom a copy of
this Prospectus is delivered, upon written or oral request of such person, a
copy of any and all of the documents that have been or may be incorporated by
reference herein (other than exhibits to such documents which are not
specifically incorporated by reference into such documents). Such requests
should be directed by mail to: Richard C. Schmalz, Director, Treasury, Nevada
Power Company, P.O. Box 230, Las Vegas, Nevada 89151 or by telephone (702)
367-5608.
NEVADA POWER COMPANY
Nevada Power, incorporated under the laws of Nevada in 1929, is an operating
public utility engaged in the electric utility business in the City of Las Vegas
and vicinity in Southern Nevada. As of September 30, 1996, Nevada Power served
approximately 478,620 customers in its service area which has a population of
approximately 1,250,000. For the year 1995, Nevada Power's electric energy
requirements were obtained from the following sources: coal generation--43%, oil
and natural gas--13%, and purchased power, including hydroelectric--44%.
Growth in Nevada Power's service territory is continuing at a rapid pace.
Nevada Power's customer base grew at annual rates of 7.2%, 6.0% and 6.0% during
1996, 1995 and 1994, respectively. Kilowatthour sales increased 13.1%, 1.4% and
7.1% during 1996, 1995 and 1994, respectively.
The principal executive offices of Nevada Power are located in Las Vegas,
Nevada, and its mailing address is P.O. Box 230, Las Vegas, Nevada 89151,
telephone number (702) 367-5000.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratios of earnings to fixed charges for
Nevada Power for the periods indicated:
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
-------------------- -----------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Twelve Months Ratio of Earnings
to Fixed Charges........................ 3.02 2.92 2.84 3.11 2.90 2.42 1.89
</TABLE>
In computing the ratio, earnings represent income before interest expenses,
plus income taxes; fixed charges represent the total of interest on long-term
debt, amortization of debt discounts, premiums and expenses, other interest,
plus one-third annual rentals.
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<PAGE>
USE OF PROCEEDS
Except as otherwise specified in the related Prospectus Supplement, the net
proceeds from the sale of the QUIDS will be added to the general funds of Nevada
Power and will be used for general corporate utility purposes, which may include
the purchase or redemption of one or more series of its preferred stock, capital
expenditures, the reduction of short-term borrowings and working capital.
THE ISSUERS
Each Issuer is a statutory business trust formed under Delaware law pursuant
to (i) a trust agreement executed by Nevada Power, as sponsor of the Issuer, and
the Delaware Trustee (as defined herein) of such Issuer and (ii) the filing of a
certificate of trust with the Secretary of State of the State of Delaware. Each
trust agreement will be amended and restated in its entirety (each, as so
amended and restated, a "Trust Agreement") substantially in the form filed as an
exhibit to the Registration Statement of which this Prospectus forms a part.
Each Trust Agreement will be qualified as an indenture under the Trust Indenture
Act of 1939, as amended (the "Trust Indenture Act"). Each Issuer exists for the
exclusive purposes of (i) issuing and selling its QUIPS and Common Securities,
(ii) using the proceeds from the sale of such QUIPS and Common Securities to
acquire a corresponding series of Corresponding QUIDS issued by Nevada Power,
(iii) receiving payments to be made with respect to the QUIDS and disbursing
such payments in accordance with the terms of the Trust Agreements and (iv)
engaging in only those other activities necessary, convenient or incidental
thereto. Accordingly, the Corresponding QUIDS will be the sole assets of each
Issuer, and payments under the Corresponding QUIDS and the Expense Agreement
will be the sole revenue of each Issuer.
All of the Common Securities will be owned by Nevada Power. The Common
Securities of an Issuer will rank PARI PASSU, and payments will be made thereon
pro rata, with the QUIPS of such Issuer, except that upon the occurrence and
continuance of an event of default under a Trust Agreement resulting from a
Debenture Event of Default (as defined herein), the rights of Nevada Power as
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 QUIPS of such Issuer. See "Description of
QUIPS--Subordination of Common Securities." Nevada Power will acquire Common
Securities in an aggregate liquidation amount equal to not less than 3% of the
total capital of each Issuer.
Unless otherwise specified in the applicable Prospectus Supplement, each
Issuer has a term of approximately 55 years, but may terminate earlier as
provided in the applicable Trust Agreement. Each Issuer's business and affairs
are conducted by its trustees, which will be appointed by Nevada Power as holder
of the Common Securities.
Unless otherwise specified in the applicable Prospectus Supplement, the
trustees shall be IBJ Schroder Bank & Trust Company ("IBJ Schroder"), as the
Property Trustee (the "Property Trustee") and Delaware Trust Capital Management
as the Delaware Trustee (the "Delaware Trustee"), and two individual trustees
(the "Administrative Trustees") who are employees or officers of or affiliated
with Nevada Power (collectively, the "Issuer Trustees"). IBJ Schroder, as
Property Trustee, will act as sole indenture trustee under each Trust Agreement
for purposes of compliance with the Trust Indenture Act. IBJ Schroder will also
act as trustee under the Guarantees and the Indenture (each as defined herein).
See "Description of Guarantees" and "Description of QUIDS." The holder of the
Common Securities, or the holders of a majority in liquidation preference of the
QUIPS if any Debenture Event of Default has occurred and is continuing, will be
entitled to appoint, remove or replace the Issuer Trustees. The duties and
obligations of each Issuer Trustee are governed by the applicable Trust
Agreement. Nevada Power will pay all fees and expenses related to each Issuer
and the offering of the QUIPS and will pay, directly or indirectly, all ongoing
costs, expenses and liabilities of each Issuer. The principal executive office
of each Issuer is 6226 West Sahara Avenue, Las Vegas, Nevada 89102, Attention:
Secretary, and its telephone number is (702) 367-5000.
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<PAGE>
DESCRIPTION OF QUIDS
The QUIDS are to be issued in one or more series under a Junior Subordinated
Indenture, as supplemented from time to time (as so supplemented, the
"Indenture"), between Nevada Power and IBJ Schroder, as trustee (the "Debenture
Trustee"). This summary of certain terms and provisions of the QUIDS and the
Indenture does not purport to be complete and is subject to, and is qualified in
its entirety by reference to, the Indenture, the form of which is filed as an
exhibit to the Registration Statement of which this Prospectus forms a part, and
to the Trust Indenture Act. Whenever particular defined terms of the Indenture
(as supplemented or amended from time to time) are referred to herein or in a
Prospectus Supplement, such defined terms are incorporated herein or therein by
reference.
GENERAL
Each series of QUIDS will rank PARI PASSU with all other series of QUIDS,
and will be unsecured and subordinate and junior in right of payment to the
extent and in the manner set forth in the Indenture to all Senior Debt (as
defined below) of Nevada Power. See "--Subordination." Unless otherwise
specified in the applicable Prospectus Supplement, the Indenture does not limit
the incurrence or issuance of other secured or unsecured debt, including Senior
Debt, of Nevada Power, whether under the Indenture or any existing or other
indenture that Nevada Power may enter into in the future or otherwise,
including, without limitation, Nevada Power's Indenture of Mortgage and Deed of
Trust dated October 1, 1953 entered into with Bankers Trust Company, together
with supplemental indentures thereto heretofore or hereafter entered into. See
"--Subordination" and the Prospectus Supplement relating to any offering of
securities.
The QUIDS will be issuable in one or more series pursuant to an indenture
supplemental to the Indenture or a resolution of Nevada Power's board of
directors or a committee thereof.
The applicable Prospectus Supplement or Prospectus Supplements will describe
the following terms of the QUIDS: (1) the title of the QUIDS; (2) any limit upon
the aggregate principal amount of the QUIDS; (3) the date or dates on which the
principal of the QUIDS is payable or the method of determination thereof; (4)
the rate or rates, if any, at which the QUIDS shall bear interest, the Interest
Payment Dates on which any such interest shall be payable, the right, if any, of
Nevada Power to defer or extend an Interest Payment Date, and the Regular Record
Date for any interest payable on any Interest Payment Date or the method by
which any of the foregoing shall be determined; (5) the place or places where,
subject to the terms of the Indenture as described below under "Payment and
Paying Agents", the principal of and premium, if any, and interest on the QUIDS
will be payable and where, subject to the terms of the Indenture as described
below under "Denominations; Registration of Transfer", the QUIDS may be
presented for registration of transfer or exchange and the place or places where
notices and demands to or upon Nevada Power in respect of the QUIDS and the
Indentures may be made ("Place of Payment"); (6) any period or periods within or
date or dates on which, the price or prices at which and the terms and
conditions upon which QUIDS may be redeemed, in whole or in part, at the option
of Nevada Power or a holder thereof; (7) the obligation or the right, if any, of
Nevada Power or a holder thereof to redeem, purchase or repay the QUIDS and the
period or periods within which, the price or prices at which, the currency or
currencies (including currency unit or units) in which and the other terms and
conditions upon which the QUIDS shall be redeemed, repaid or purchased, in whole
or in part, pursuant to such obligation; (8) the denominations in which any
QUIDS shall be issuable if other than denominations of $25 and any integral
multiple thereof; (9) if other than in U.S. Dollars, the currency or currencies
(including currency unit or units) in which the principal of and premium, if
any, and interest, if any, on the QUIDS shall be payable, or in which the QUIDS
shall be denominated; (10) any additions, modifications or deletions in the
Debenture Events of Default or covenants of Nevada Power specified in the
Indenture with respect to the QUIDS; (11) if other than the principal amount
thereof, the portion of the principal amount of QUIDS that shall be payable upon
declaration of acceleration of the maturity thereof; (12) any additions or
changes to the Indenture with respect to a series of QUIDS as shall be necessary
to permit or facilitate the issuance of such series in bearer form, registrable
or not registrable as to principal, and with or without
6
<PAGE>
interest coupons; (13) any index or indices used to determine the amount of
payments of principal of and premium, if any, on the QUIDS and the manner in
which such amounts will be determined; (14) the terms and conditions relating to
the issuance of a temporary Global Security representing all of the QUIDS of
such series and the exchange of such temporary Global Security for definitive
QUIDS of such series; (15) subject to the terms described under "Global QUIDS,"
whether the QUIDS of the series shall be issued in whole or in part in the form
of one or more Global Securities and, in such case, the Depositary for such
Global Securities, which Depositary shall be a clearing agency registered under
the Exchange Act; (16) the appointment of any Paying Agent or Agents; (17) the
terms and conditions of any obligation or right of Nevada Power or a holder to
convert or exchange the QUIDS into QUIPS or other securities; and (18) any other
terms of the QUIDS not inconsistent with the provisions of the Indenture.
QUIDS may be sold at a substantial discount below their stated principal
amount, bearing no interest or interest at a rate which at the time of issuance
is below market rates. Certain United States federal income tax consequences and
special considerations applicable to any such QUIDS will be described in the
applicable Prospectus Supplement.
If the purchase price of any of the QUIDS is payable in one or more foreign
currencies or currency units or if any QUIDS are denominated in one or more
foreign currencies or currency units or if the principal of, premium, if any, or
interest, if any, on any QUIDS is payable in one or more foreign currencies or
currency units, the restrictions, elections, certain United States federal
income tax consequences, specific terms and other information with respect to
such issue of QUIDS and such foreign currency or currency units will be set
forth in the applicable Prospectus Supplement.
If any index is used to determine the amount of payments of principal of,
premium, if any, or interest on any series of QUIDS, special United States
federal income tax, accounting and other considerations applicable thereto will
be described in the applicable Prospectus Supplement.
DENOMINATIONS; REGISTRATION OF TRANSFER
Unless otherwise specified in the applicable Prospectus Supplement, the
QUIDS will be issuable only in registered form without coupons in denominations
of $25 and any integral multiple thereof. QUIDS of any series will be
exchangeable for other QUIDS of the same issue and series, of any authorized
denominations, of a like aggregate principal amount, of the same original issue
date and stated maturity and bearing the same interest rate.
QUIDS may be presented for exchange as provided above, and may be presented
for registration of transfer (with the form of transfer endorsed thereon, or a
satisfactory written instrument of transfer, duly executed), at the office of
the appropriate Securities Registrar or at the office of any transfer agent
designated by Nevada Power for such purpose with respect to any series of QUIDS
and referred to in the applicable Prospectus Supplement, without service charge
and upon payment of any taxes and other governmental charges as described in the
Indenture. Nevada Power will appoint the Debenture Trustee as Securities
Registrar under the Indenture. If the applicable Prospectus Supplement refers to
any transfer agents (in addition to the Securities Registrar) initially
designated by Nevada Power with respect to any series of QUIDS, Nevada Power may
at any time rescind the designation of any such transfer agent or approve a
change in the location through which any such transfer agent acts, provided that
Nevada Power maintains a transfer agent in each Place of Payment for such
series. Nevada Power may at any time designate additional transfer agents with
respect to any series of QUIDS.
In the event of any redemption, neither Nevada Power nor the Debenture
Trustee shall be required to (i) issue, register the transfer of or exchange
QUIDS of any series during a period beginning at the opening of business 15 days
before the day of selection for redemption of QUIDS of that series and ending at
the close of business on the day of mailing of the relevant notice of redemption
or (ii) transfer or exchange any QUIDS so selected for redemption, except, in
the case of any QUIDS being redeemed in part, any portion thereof not to be
redeemed.
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<PAGE>
GLOBAL QUIDS
The QUIDS of a series may be issued in whole or in part in the form of one
or more Global QUIDS that will be deposited with, or on behalf of, a depositary
(the "Depositary") identified in the Prospectus Supplement relating to such
series. Global QUIDS may be issued only in fully registered form and in either
temporary or permanent form. Unless and until it is exchanged in whole or in
part for the individual QUIDS represented thereby, a Global QUIDS may not be
transferred except as a whole by the Depositary for such Global QUIDS to a
nominee of such Depositary or by a nominee of such Depositary to such Depositary
or another nominee of such Depositary or by the Depositary or any nominee to a
successor Depositary or any nominee of such successor.
The specific terms of the depositary arrangement with respect to a series of
QUIDS will be described in the Prospectus Supplement relating to such series.
Nevada Power anticipates that the following provisions will generally apply to
depositary arrangements.
Upon the issuance of a Global QUIDS and the deposit of such Global QUIDS
with or on behalf of the Depositary, the Depositary for such Global QUIDS or its
nominee will credit on its book-entry registration and transfer system the
respective principal amounts of the individual QUIDS represented by such Global
QUIDS to the accounts of persons that have accounts with such Depositary
("Participants"). Such accounts shall be designated by the dealers, underwriters
or agents with respect to such QUIDS or by Nevada Power if such QUIDS are
offered and sold directly by Nevada Power. Ownership of beneficial interests in
a Global QUIDS will be limited to Participants or persons that may hold
interests through Participants. Ownership of beneficial interests in such Global
QUIDS will be shown on, and the transfer of that ownership will be effected only
through, records maintained by the applicable Depositary or its nominee (with
respect to interests of Participants) and the records of Participants (with
respect to interests of persons who hold through Participants). The laws of some
states require that certain purchasers of securities take physical delivery of
such securities in definitive form. Such limits and such laws may impair the
ability to transfer beneficial interests in a Global QUIDS.
So long as the Depositary for a Global QUIDS, or its nominee, is the
registered owner of such Global QUIDS, such Depositary or such nominee, as the
case may be, will be considered the sole owner or holder of the QUIDS
represented by such Global QUIDS for all purposes under the Indenture governing
such QUIDS. Except as provided below, owners of beneficial interests in a Global
QUIDS will not be entitled to have any of the individual QUIDS of the series
represented by such Global QUIDS registered in their names, will not receive or
be entitled to receive physical delivery of any such QUIDS of such series in
definitive form and will not be considered the owners or holders thereof under
the Indenture.
Payments of principal of and premium, if any, and interest on individual
QUIDS represented by a Global QUIDS registered in the name of a Depositary or
its nominee will be made to the Depositary or its nominee, as the case may be,
as the registered owner of the Global QUIDS representing such QUIDS. None of
Nevada Power, the Debenture Trustee, any Paying Agent or the Securities
Registrar for such QUIDS will have any responsibility or liability for any
aspect of the records relating to or payments made on account of beneficial
ownership interests of the Global QUIDS representing such QUIDS or for
maintaining, supervising or reviewing any records relating to such beneficial
ownership interests.
Nevada Power expects that the Depositary for a series of QUIDS or its
nominee, upon receipt of any payment of principal, premium, if any, or interest
in respect of a permanent Global QUIDS representing any of such QUIDS,
immediately will credit Participants' accounts with payments in amounts
proportionate to their respective beneficial interest in the principal amount of
such Global QUIDS representing such QUIDS as shown on the records of such
Depositary or its nominee. Nevada Power also expects that payments by
Participants to owners of beneficial interests in such Global QUIDS held through
such Participants will be governed by standing instructions and customary
practices, as is now the case with securities held for the accounts of customers
in bearer form or registered in "street name." Such payments will be the
responsibility of such Participants.
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<PAGE>
Unless otherwise specified in the applicable Prospectus Supplement, if a
Depositary for a series of QUIDS is at any time unwilling, unable or ineligible
to continue as depositary and a successor depositary is not appointed by Nevada
Power within 90 days, Nevada Power will issue individual QUIDS of such series in
exchange for the Global QUIDS representing such series of QUIDS. In addition,
Nevada Power may at any time and in its sole discretion, subject to any
limitations described in the Prospectus Supplement relating to such QUIDS,
determine not to have any QUIDS of such series represented by one or more Global
QUIDS and, in such event, will issue individual QUIDS of such series in exchange
for the Global QUIDS representing such series of QUIDS. Further, if Nevada Power
so specifies with respect to the QUIDS of a series, an owner of a beneficial
interest in a Global QUIDS representing QUIDS of such series may, on terms
acceptable to Nevada Power, the Debenture Trustee and the Depositary for such
Global QUIDS, receive individual QUIDS of such series in exchange for such
beneficial interests, subject to any limitations described in the Prospectus
Supplement relating to such QUIDS. In any such instance, an owner of a
beneficial interest in a Global QUIDS will be entitled to physical delivery of
individual QUIDS of the series represented by such Global QUIDS equal in
principal amount to such beneficial interest and to have such QUIDS registered
in its name. Individual QUIDS of such series so issued will be issued in
denominations, unless otherwise specified by Nevada Power, of $25 and integral
multiples thereof.
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in the applicable Prospectus Supplement, payment
of principal of and premium, if any, and any interest on QUIDS will be made at
the office of the Debenture Trustee in New York, New York or at the office of
such Paying Agent or Paying Agents as Nevada Power may designate from time to
time in the applicable Prospectus Supplement, except that at the option of
Nevada Power payment of any interest may be made (i) by check mailed to the
address of the Person entitled thereto as such address shall appear in the
Securities Register or (ii) by transfer to an account maintained by the Person
entitled thereto as specified in the Securities Register, provided that proper
transfer instructions have been received by the Regular Record Date. Unless
otherwise indicated in the applicable Prospectus Supplement, payment of any
interest on QUIDS will be made to the Person in whose name such QUIDS is
registered at the close of business on the Regular Record Date for such
interest, except in the case of Defaulted Interest. Nevada Power may at any time
designate additional Paying Agents or rescind the designation of any Paying
Agent; however Nevada Power will at all times be required to maintain a Paying
Agent in each Place of Payment for each series of QUIDS.
Any moneys deposited with the Debenture Trustee or any Paying Agent, or then
held by Nevada Power in trust, for the payment of the principal of and premium,
if any, or interest on any QUIDS and remaining unclaimed for two years after
such principal and premium, if any, or interest has become due and payable
shall, at the request of Nevada Power, be repaid to Nevada Power and the holder
of such QUIDS shall thereafter look, as a general unsecured creditor, only to
Nevada Power for payment thereof.
REDEMPTION
Unless otherwise indicated in the applicable Prospectus Supplement, QUIDS
will not be subject to any sinking fund.
Unless otherwise indicated in the applicable Prospectus Supplement, Nevada
Power may, at its option, redeem the QUIDS of any series in whole at any time or
in part from time to time. QUIDS in denominations larger than $25 may be
redeemed in part but only in integral multiples of $25. Except as otherwise
specified in the applicable Prospectus Supplement, the redemption price for any
QUIDS so redeemed shall equal any accrued and unpaid interest thereon to the
redemption date, plus the principal amount thereof.
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Except as otherwise specified in the applicable Prospectus Supplement, if a
Tax Event (as defined under "Description of QUIPS--Redemption") in respect of a
series of QUIDS has occurred and is continuing, Nevada Power may, at its option,
redeem such series of QUIDS in whole (but not in part) at any time within 90
days of the occurrence of such Tax Event, at a redemption price equal to 100% of
the principal amount of such QUIDS then outstanding plus accrued and unpaid
interest to the date fixed for redemption.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each holder of QUIDS to be redeemed at its
registered address. Unless Nevada Power defaults in payment of the redemption
price, on and after the redemption date interest ceases to accrue on such QUIDS
or portions thereof called for redemption.
OPTION TO EXTEND INTEREST PAYMENT DATE
If provided in the applicable Prospectus Supplement, Nevada Power shall have
the right at any time and from time to time during the term of any series of
QUIDS to defer payment of interest for such number of consecutive interest
payment periods as may be specified in the applicable Prospectus Supplement
(each, an "Extension Period"), subject to the terms, conditions and covenants,
if any, specified in such Prospectus Supplement, provided that such Extension
Period may not extend beyond the Stated Maturity of such series of QUIDS.
Certain United States federal income tax consequences and special considerations
applicable to any such QUIDS will be described in the applicable Prospectus
Supplement.
During such Extension Period, Nevada Power may not, and may not permit any
subsidiary of Nevada Power to, (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire or make a liquidation payment with respect to,
any of Nevada Power's capital stock or (ii) make any payment of principal of, or
interest or premium, if any, on or repay, repurchase or redeem, or make any
sinking fund payment with respect to, any indebtedness of Nevada Power that
ranks PARI PASSU with or junior in right of payment to the QUIDS or make any
guarantee payments with respect to any guarantee by Nevada Power of the any
indebtedness if such guarantee ranks PARI PASSU or junior in right of payment to
the QUIDS (other than (a) dividends or distributions in Common Stock of Nevada
Power, (b) redemption or purchases of any rights pursuant to Nevada Power's
Stock Purchase Rights Plan, or any successor to such Stock Purchase Rights Plan,
and the declaration of a dividend of such rights or the issuance of Preferred
Stock under such plans in the future, (c) payments under any Guarantee, (d)
purchases of Common Stock related to the issuance of Common Stock under the
Stock Purchase and Dividend Reinvestment Plan and any of Nevada Power's benefit
plans for its directors, officers or employees and (e) purchases of Common Stock
required to prevent the loss or secure the renewal or reinstatement of any
government license or franchise held by Nevada Power or any of its
subsidiaries).
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MODIFICATION OF INDENTURE
From time to time Nevada Power and the Debenture Trustee may, without the
consent of or notice to the holders of any series of QUIDS, amend, waive or
supplement the Indenture for specified purposes, including, among other things,
curing ambiguities, defects or inconsistencies (provided that any such action
does not materially adversely affect the interest of the holders of any series
of QUIDS or, in the case of Corresponding QUIDS, the holders of the
corresponding series of QUIPS so long as they remain outstanding) and
qualifying, or maintaining the qualification of, the Indenture under the Trust
Indenture Act. The Indenture contains provisions permitting Nevada Power and the
Debenture Trustee, with the consent of the holders of a majority in principal
amount of each outstanding series of QUIDS affected, to modify the Indenture in
a manner affecting the rights of the holders of such series of the QUIDS;
provided that no such modification may, without the consent of the holder of
each outstanding QUIDS so affected, (i) change the stated maturity of any series
of QUIDS, or reduce the principal amount thereof, or reduce the rate or extend
the time of payment of interest thereon (except such change or extension as is
contemplated hereby) or (ii) reduce the percentage of principal amount of QUIDS
of any series, the holders of which are required to consent to any such
modification of the Indenture, provided that, in the case of Corresponding
QUIDS, so long as any of the related series of QUIPS remain outstanding, no such
modification may be made that adversely affects the holders of such QUIPS in any
material respect, and no termination of the Indenture may occur, and no waiver
of any Debenture Event of Default or compliance with any covenant under the
Indenture may be effective, without the prior consent of the holders of a
majority of the aggregate liquidation preference of such QUIPS unless and until
the principal of the Corresponding QUIDS and all accrued and unpaid interest
thereon have been paid in full and certain other conditions are satisfied.
In addition, Nevada Power and the Debenture Trustee may execute, without the
consent of or notice to any holder of QUIDS, any supplemental Indenture for the
purpose of creating any new series of QUIDS.
DEBENTURE EVENTS OF DEFAULT
The Indenture provides that any one or more of the following described
events with respect to a series of QUIDS that has occurred and is continuing
constitutes a "Debenture Event of Default" with respect to such series of QUIDS:
(i) failure for 30 days to pay any interest on such series of the QUIDS,
when due (subject to the deferral of any due date in the case of an
Extension Period); or
(ii) failure to pay any principal or premium, if any, on such series of
QUIDS when due whether at maturity, upon redemption by declaration or
otherwise; or
(iii) failure to observe or perform in any material respect certain other
covenants contained in the Indenture for 90 days after written notice to
Nevada Power from the Debenture Trustee or the holders of at least 25% in
aggregate outstanding principal amount of such series of outstanding QUIDS;
or
(iv) certain events in bankruptcy, insolvency or reorganization of
Nevada Power.
The holders of a majority in aggregate outstanding principal amount of such
series of QUIDS have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Debenture Trustee. The
Debenture Trustee or the holders of not less than 25% in aggregate outstanding
principal amount of such series of QUIDS may declare the principal due and
payable immediately upon a Debenture Event of Default, and, in the case of
Corresponding QUIDS, should the Debenture Trustee or such holders of such
Corresponding QUIDS fail to make such declaration, the holders of at least 25%
in aggregate liquidation preference of the related series of QUIPS shall have
such right. The holders of a majority in aggregate outstanding principal amount
of such series of QUIDS may
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annul such declaration and waive the default if the default (other than the
non-payment of the principal of such series of QUIDS which has become due solely
by such acceleration) has been cured and a sum sufficient to pay all matured
installments of interest and principal due otherwise than by acceleration has
been deposited with the Debenture Trustee and, in the case of Corresponding
QUIDS, should the holders of such Corresponding QUIDS fail to annul such
declaration and waive such default, the holders of a majority in aggregate
liquidation preference of the related series of QUIPS shall have such right.
The holders of a majority in aggregate outstanding principal amount of the
QUIDS affected thereby may, on behalf of the holders of all the QUIDS, waive any
past default, except a default in the payment of principal or interest (unless
such default has been cured and a sum sufficient to pay all matured installments
of interest and principal due otherwise than by acceleration has been deposited
with the Debenture Trustee) or a default in respect of a covenant or provision
which under the Indenture cannot be modified or amended without the consent of
the holder of each outstanding QUIDS and, in the case of Corresponding QUIDS,
should the holders of such Corresponding QUIDS fail to annul such declaration
and waive such default, the holders of a majority in aggregate liquidation
preference of the related series of QUIPS shall have such right. Nevada Power is
required to file annually with the Debenture Trustee a certificate as to whether
or not Nevada Power is in compliance with all the conditions and covenants
applicable to it under the Indenture.
In case a Debenture Event of Default has occurred and is continuing as to a
series of Corresponding QUIDS, the Property Trustee will have the right to
declare the principal of and the interest on such Corresponding QUIDS and any
other amounts payable under the Indenture, to be forthwith due and payable and
to enforce its other rights as a creditor with respect to such Corresponding
QUIDS.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF QUIPS
If a Debenture Event of Default has occurred and is continuing and such
event is attributable to the failure of Nevada Power to pay interest or
principal on the related QUIDS on the date such interest or principal is
otherwise payable, a holder of QUIPS may institute a Direct Action (as defined
below under "Description of QUIPS--Enforcement of Certain Rights by Holders of
QUIPS") for payment after the respective due date specified in the related
QUIDS. Nevada Power may not amend the Indenture to remove the foregoing right to
bring a Direct Action without the prior written consent of the holders of all of
the QUIPS. Notwithstanding any payment made to such holder of QUIPS by Nevada
Power in connection with a Direct Action, Nevada Power shall remain obligated to
pay the principal of or interest on the related QUIDS held by the Issuer or the
Property Trustee and Nevada Power shall be subrogated to the rights of the
holder of such QUIPS with respect to payments on the QUIPS to the extent of any
payments made by Nevada Power to such holder in any Direct Action. The holders
of QUIPS will not be able to exercise directly any other remedy available to the
holders of the related QUIDS.
The holders of the QUIPS would not be able to exercise directly any remedies
other than those set forth in the preceding paragraph available to the holders
of the QUIDS unless the Property Trustee or the Debenture Trustee, acting for
the benefit of the Property Trustee, fails to do so for 60 days. In such event,
the holders of at least 25% in aggregate liquidation preference of the
outstanding QUIPS would have such right to institute proceedings.
CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS
The Indenture provides that Nevada Power shall not consolidate with or merge
into any other Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, and no Person shall consolidate with
or merge into Nevada Power or convey, transfer or lease its properties and
assets substantially as an entirety to Nevada Power, unless (i) in case Nevada
Power consolidates with or merges into another Person or conveys, transfers or
leases its properties and assets substantially as an entirety to any Person, the
successor Person is organized under the laws of the United States or any state
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or the District of Columbia, and such successor Person expressly assumes Nevada
Power's obligations on the QUIDS issued under the Indenture; (ii) immediately
after giving effect thereto, no Debenture Event of Default, and no event which,
after notice or lapse of time or both, would become a Debenture Event of
Default, shall have happened and be continuing; (iii) in the case of
Corresponding QUIDS, such transaction is permitted under the related Trust
Agreement or Guarantee and does not give rise to any breach or violation of the
related Trust Agreement and Guarantees; and (iv) certain other conditions as
prescribed in the Indenture are met.
The general provisions of the Indenture do not afford holders of the QUIDS
protection in the event of a highly leveraged or other transaction involving
Nevada Power that may adversely affect holders of the QUIDS.
SATISFACTION AND DISCHARGE
The Indenture provides that when, among other things, all QUIDS not
previously delivered to the Debenture Trustee for cancellation (i) have become
due and payable or (ii) will become due and payable at their Stated Maturity
within one year, and Nevada Power deposits or causes to be deposited with the
Debenture Trustee funds or Government Obligations, in trust, for the purpose and
in an amount in the currency or currencies in which the QUIDS are payable
sufficient to pay and discharge the entire indebtedness on the QUIDS not
previously delivered to the Debenture Trustee for cancellation, for the
principal and premium, if any, and interest to the date of the deposit or
applicable redemption date or to the Stated Maturity, as the case may be, then
the Indenture will cease to be of further effect (except as to Nevada Power's
obligations to pay all other sums due pursuant to the Indenture and to provide
the officers' certificates and opinions of counsel described therein), and
Nevada Power will be deemed to have satisfied and discharged the Indenture.
CONVERSION OR EXCHANGE
Unless otherwise indicated in the applicable Prospectus Supplement, the
QUIDS of any series may be convertible or exchangeable into QUIPS or other
securities. The specific terms on which QUIDS of any series may be so converted
or exchanged will be set forth in the applicable Prospectus Supplement. Such
terms may include provisions for conversion or exchange, either mandatory, at
the option of the holder, or at the option of Nevada Power, in which case the
number of shares of QUIPS or other securities to be received by the Holders of
QUIDS would be calculated as of a time and in the manner stated in the
applicable Prospectus Supplement.
SUBORDINATION
Any QUIDS issued under the Indenture, by the express terms thereof, will be
subordinate and junior in right of payment to all Senior Debt to the extent
provided in the Indenture. Upon any payment or distribution of assets to
creditors upon any liquidation, dissolution, winding-up, reorganization,
assignment for the benefit of creditors, marshaling of assets or any bankruptcy,
insolvency, debt restructuring or similar proceedings in connection with any
insolvency or bankruptcy proceeding of Nevada Power, the holders of Senior Debt
will first be entitled to receive payment in full of principal of and premium,
if any, and interest, if any, on such Senior Debt before the holders of QUIDS
or, in the case of Corresponding QUIDS, the Property Trustee on behalf of the
holders, will be entitled to receive or retain any payment in respect of the
principal of and premium, if any, or interest, if any, on the QUIDS.
In the event of the acceleration of the maturity of any QUIDS, the holders
of all Senior Debt outstanding at the time of such acceleration will first be
entitled to receive payment in full of all amounts due thereon (including any
amounts due upon acceleration) before the holders of QUIDS will be entitled to
receive or retain any payment in respect of the principal of or premium, if any,
or interest, if any, on the QUIDS.
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No payments on account of principal (or premium, if any) or interest, if
any, in respect of the QUIDS may be made if there has occurred and is continuing
a default in any payment with respect to Senior Debt, or an event of default
with respect to any Senior Debt resulting in the acceleration of the maturity
thereof, or if any judicial proceeding shall be pending with respect to any such
default.
"Debt" means with respect to any Person, whether recourse is to all or a
portion of the assets of such Person and whether or not contingent, (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; and (vi) every
obligation of the type referred to in clauses (i) through (v) of another Person
and all dividends of another Person the payment of which, in either case, such
Person has guaranteed or is responsible or liable, directly or indirectly, as
obligor or otherwise.
"Senior Debt" means the principal of and premium and interest, if any
(including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to Nevada Power whether or not such
claim for post-petition interest is allowed in such proceeding), on Debt,
whether incurred on or prior to the date of the Indenture or thereafter
incurred, unless, in the instrument creating or evidencing the same or pursuant
to which the same is outstanding, it is provided that such obligations are not
superior in right of payment to the QUIDS or to other Debt which is PARI PASSU
with, or subordinated to, the QUIDS; provided, however, that Senior Debt shall
not be deemed to include (i) any Debt of Nevada Power which when incurred and
without respect to any election under Section 1111 (b) of the Bankruptcy Code,
was without recourse to Nevada Power, (ii) any Debt of Nevada Power to any of
its subsidiaries, (iii) Debt to any employee of Nevada Power, (iv) any liability
for taxes, and (v) indebtedness or monetary obligations to trade creditors or
assumed by Nevada Power or any of its subsidiaries in the ordinary course of
business in connection with the obtaining of materials or services.
The Indenture places no limitation on the amount of additional Senior Debt
that may be incurred by Nevada Power. The electric utility business is capital
intensive. Nevada Power has substantial amounts of outstanding indebtedness
constituting Senior Debt and anticipates that it will in the future incur
substantial amounts of additional indebtedness constituting Senior Debt.
The Indenture provides that the foregoing subordination provisions, insofar
as they relate to any particular issue of QUIDS, may be changed prior to such
issuance. Any such change would be described in the applicable Prospectus
Supplement.
GOVERNING LAW
The Indenture and the QUIDS will be governed by and construed in accordance
with the laws of the State of Nevada.
INFORMATION CONCERNING THE DEBENTURE TRUSTEE
The Debenture Trustee shall have and be subject to all the duties and
responsibilities specified with respect to an indenture trustee under the Trust
Indenture Act. Subject to such provisions, the Debenture Trustee is under no
obligation to exercise any of the powers vested in it by the Indenture at the
request of any holder of QUIDS, unless offered reasonable indemnity by such
holder against the costs, expenses and liabilities which might be incurred
thereby. The Debenture Trustee is not required to expend or risk its own funds
or otherwise incur personal financial liability in the performance of its duties
if the Debenture Trustee reasonably believes that repayment or adequate
indemnity is not reasonably assured to it.
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DESCRIPTION OF QUIPS
Pursuant to the terms of the Trust Agreement for each Issuer, the Issuer
Trustees on behalf of such Issuer will issue the QUIPS and the Common
Securities. The QUIPS of a particular issue will represent preferred undivided
beneficial interests in the assets of the related Issuer and the holders thereof
will be entitled to a preference in certain circumstances with respect to
Distributions and amounts payable on redemption or liquidation over the Common
Securities of such Issuer, as well as other benefits as described in the
corresponding Trust Agreement. This summary of certain provisions of the QUIPS
and each Trust Agreement does not purport to be complete and is subject to, and
is qualified in its entirety by reference to, all the provisions of each Trust
Agreement, including the definitions therein of certain terms, and the Trust
Indenture Act. Wherever particular defined terms of a Trust Agreement (as
supplemented or amended from time to time) are referred to herein or in a
Prospectus Supplement, such defined terms are incorporated herein or therein by
reference. The form of each Trust Agreement has been filed as an exhibit to the
Registration Statement of which this Prospectus forms a part. Each of the
Issuers is a legally separate entity and the assets of one are not available to
satisfy the obligations of any of the others.
GENERAL
The QUIPS of an Issuer will rank PARI PASSU, and payments will be made
thereon pro rata, with the Common Securities of that Issuer except as described
under "--Subordination of Common Securities." Legal title to the Corresponding
QUIDS will be held by the Property Trustee in trust for the benefit of the
holders of the related QUIPS and Common Securities. Each Guarantee Agreement
executed by Nevada Power for the benefit of the holders of an Issuer's QUIPS
(each, the "Guarantee") will be a guarantee on a subordinated basis with respect
to the related QUIPS but will not guarantee payment of Distributions or amounts
payable on redemption or liquidation of such QUIPS when the related Issuer does
not have funds on hand available to make such payments. See "Description of
Guarantees."
DISTRIBUTIONS
Each Issuer's QUIPS represent preferred undivided beneficial interests in
the assets of such Issuer, and the Distributions on each QUIPS will be payable
at a rate specified in the Prospectus Supplement for such QUIPS. The amount of
Distributions payable for any period will be computed on the basis of a 360-day
year of twelve 30-day months unless otherwise specified in the applicable
Prospectus Supplement. Distributions to which holders of QUIPS are entitled will
accumulate additional Distributions at the rate per annum if and as specified in
the applicable Prospectus Supplement. The term "Distributions" as used herein
includes any such additional Distributions unless otherwise stated.
Distributions on the QUIPS will be cumulative, will accrue from the date of
original issuance and will be payable on such dates as specified in the
applicable Prospectus Supplement. In the event that any date on which
Distributions are payable on the QUIPS is not a Business Day (as defined below),
payment of the Distribution payable on such date will be made on the next
succeeding day that is a Business Day (and without any interest or other payment
in respect to 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 the foregoing, a "Distribution Date"). A "Business Day" shall
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.
If provided in the applicable Prospectus Supplement, Nevada Power has the
right under the Indenture, pursuant to which it will issue the Corresponding
QUIDS, to defer the payment of interest at any time or from time to time on any
series of the Corresponding QUIDS for a period which will be specified
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in such Prospectus Supplement relating to such series (each, an "Extension
Period"), provided that no Extension Period may extend beyond the Stated
Maturity of such series of QUIDS. As a consequence of any such extension,
Distributions on the corresponding QUIPS would be deferred (but the QUIPS would
continue to accumulate additional Distributions thereon at the rate per annum
set forth in the Prospectus Supplement for such QUIPS) by the Issuer of such
QUIPS during any such Extension Period. During such Extension Period Nevada
Power may not, and may not permit any subsidiary of Nevada Power to, (i) declare
or pay any dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of Nevada Power's capital stock or (ii)
make any payment of principal of, or interest or premium, if any, on or repay,
repurchase or redeem, or make any sinking fund payment with respect, to any
indebtedness of Nevada Power that ranks PARI PASSU with or junior in right of
payment to the Corresponding QUIDS or make any guarantee payments with respect
to any guarantee by Nevada Power of any indebtedness if such guarantee ranks
PARI PASSU or junior in right of payment to the Series A QUIDS (other than (a)
dividends or distributions in Common Stock of Nevada Power, (b) redemption or
purchases of any rights pursuant to Nevada Power's Stock Purchase Rights Plan,
or any successor to such Stock Purchase Rights Plan, and the declaration of a
dividend of such rights or the issuance of Preferred Stock under such plans in
the future, (c) payments under any Guarantee, (d) purchases of Common Stock
related to the issuance of Common Stock under Nevada Power's Stock Purchase and
Dividend Reinvestment Plan and any of Nevada Power's benefit plans for its
directors, officers or employees and (e) purchases of Common Stock required to
prevent the loss or secure the renewal or reinstatement of any government
license or franchise held by Nevada Power or any of its subsidiaries).
The revenue of each Issuer available for distribution to holders of its
QUIPS will be limited to payments under the Corresponding QUIDS in which the
Issuer will invest the proceeds from the issuance and sale of its QUIPS and its
Common Securities. See "Description of Corresponding QUIDS." If Nevada Power
does not make interest payments on such Corresponding QUIDS, the Property
Trustee will not have funds available to pay Distributions on the related QUIPS.
The payment of Distributions (if and to the extent the Issuer has funds legally
available for the payment of such Distributions and cash sufficient to make such
payments) is guaranteed by Nevada Power on a limited basis as set forth herein
under "Description of Guarantees."
Distributions on the QUIPS will be payable to the holders thereof as they
appear on the register of such Issuer on the relevant record dates, which, as
long as the QUIPS 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 provisions of the applicable Trust Agreement, each such payment will be
made as described under "--Book-Entry Issuance." In the event any QUIPS are not
in book-entry form, the relevant record date for such QUIPS shall be a date at
least 15 days prior to the relevant Distribution Date, as specified in the
applicable Prospectus Supplement.
REDEMPTION
MANDATORY REDEMPTION. Upon the repayment or redemption, in whole or in
part, of any Corresponding QUIDS, whether at maturity or upon earlier redemption
as provided in the Indenture, the proceeds from such repayment or redemption
shall be applied by the Property Trustee to redeem a Like Amount (as defined
below) of the related QUIPS and the Common Securities, upon not less than 30 or
more than 60 days notice, at a redemption price (the "Redemption Price"), with
respect to such QUIPS and the Common Securities, equal to the aggregate
liquidation preference of such QUIPS plus accumulated and unpaid Distributions
thereon to the date of redemption (the "Redemption Date") and the related amount
of the premium, if any, paid by Nevada Power upon the concurrent redemption of
such Corresponding QUIDS. See "Description of Corresponding QUIDS--Optional
Redemption." If less than all of any series of Corresponding QUIDS are to be
repaid or redeemed on a Redemption Date, then the proceeds from such repayment
or redemption shall be allocated to the redemption pro rata of the related QUIPS
and the Common Securities. The amount of premium, if any, paid by Nevada Power
upon the redemption of all or
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any part of any series of any Corresponding QUIDS to be repaid or redeemed on a
Redemption Date shall be allocated to the redemption pro rata of the related
QUIPS and the Common Securities.
Nevada Power will have the right to redeem any series of Corresponding QUIDS
(i) in whole at any time or in part from time to time, subject to the conditions
described under "Description of Corresponding QUIDS--Optional Redemption," (ii)
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") and
subject to the further conditions described under "Description of Corresponding
QUIDS--Optional Redemption," or (iii) as may be otherwise specified in the
applicable Prospectus Supplement.
SPECIAL EVENT REDEMPTION OR DISTRIBUTION OF CORRESPONDING QUIDS. If a
Special Event in respect of a series of QUIPS and Common Securities has occurred
and is continuing, Nevada Power has the right to redeem the Corresponding QUIDS
in whole (but not in part) and thereby cause a mandatory redemption of such
QUIPS and Common Securities in whole (but not in part) at the Redemption Price
within 90 days following the occurrence of such Special Event. At any time,
Nevada Power has the right to terminate the related Issuer and, after
satisfaction of liabilities to creditors of such Issuer as provided by
applicable law, cause such Corresponding QUIDS to be distributed to the holders
of such QUIPS and Common Securities in liquidation of the Issuer. If Nevada
Power does not elect either option described above, the applicable series of
QUIPS will remain outstanding and, in the event a Tax Event has occurred and is
continuing, Additional Sums (as defined below) may be payable on the
Corresponding QUIDS.
EXTENSION OF MATURITY OF CORRESPONDING QUIDS. If provided in the applicable
Prospectus Supplement, Nevada Power shall have the right to extend or shorten
the maturity of any series of Corresponding QUIDS at the time that Nevada Power
exercises its right to elect to liquidate the related Issuer and cause such
Corresponding QUIDS to be distributed to the holders of such QUIPS and Common
Securities in liquidation of the Issuer, provided that it can extend the
maturity only if certain conditions specified in the applicable Prospectus
Supplement are met at the time such election is made and at the time of such
extension.
"Additional Sums" means the additional amounts as may be necessary in order
that the amount of Distributions then due and payable by an Issuer on the
outstanding QUIPS and Common Securities of the Issuer shall not be reduced as a
result of any additional taxes, duties and other governmental charges to which
the Issuer has become subject as a result of a Tax Event.
"Investment Company Event" means the receipt by the applicable Issuer of an
opinion of counsel, rendered by a law firm having a recognized national tax and
securities practice, to the effect that, as a result of 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 (a "Change in 1940 Act Law"), the applicable Issuer is or will be
considered an "investment company" that is required to be registered under the
Investment Company Act of 1940, as amended (the "Investment Company Act"), which
Change in 1940 Act Law becomes effective on or after the date of original
issuance of the series of QUIPS issued by the applicable Issuer.
"Like Amount" means (i) with respect to a redemption of any series of QUIPS,
QUIPS of such series and the Common Securities having a Liquidation Amount (as
defined below) equal to that portion of the principal amount of Corresponding
QUIDS to be contemporaneously redeemed in accordance with the Indenture
allocated 3% to the Common Securities and 97% to the QUIPS of such series and
the proceeds of which will be used to pay the Redemption Price of such QUIPS and
to redeem such Common Securities, and (ii) with respect to a distribution of
Corresponding QUIDS to holders of any series of QUIPS and the Common Securities
in connection with a dissolution or liquidation of the related Issuer,
Corresponding QUIDS having a principal amount equal to the Liquidation Amount of
the QUIPS and the Common Securities of the holder to whom such Corresponding
QUIDS are distributed.
"Liquidation Amount" means the stated amount of $25 per QUIPS and Common
Security.
"Tax Event" means the receipt by the applicable Issuer of an opinion of
counsel, rendered by a law firm having a national tax and securities practice,
to the effect that, as a result of any amendment to, or
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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, or as a result of any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or which
pronouncement or decision is announced on or after the date of issuance of the
QUIPS under the related Trust Agreement, there is more than an insubstantial
risk that (i) the applicable Issuer is, or will be within 90 days of the date of
such opinion, subject to United States federal income tax with respect to income
received or accrued on the corresponding series of Corresponding QUIDS, (ii)
interest payable by Nevada Power on such series of Corresponding QUIDS is not,
or within 90 days of the date of such opinion, will not be, deductible by Nevada
Power, in whole or in part, for United States federal income tax purposes, or
(iii) the applicable Issuer is, or will be within 90 days of the date of such
opinion, subject to more than a DE MINIMIS amount of other taxes, duties or
other governmental charges.
In certain circumstances involving the termination of an Issuer,
corresponding QUIDS may be distributed in exchange for QUIPS. After the
liquidation date fixed for any distribution of Corresponding QUIDS for any
series of QUIPS (i) such series of QUIPS will no longer be deemed to be
outstanding, (ii) The Depository Trust Company ("DTC") or its nominee, as the
record holder of such series of QUIPS, will receive a registered global
certificate or certificates representing the Corresponding QUIDS to be delivered
upon such distribution and (iii) any certificates representing such series of
QUIPS not held by DTC or its nominee will be deemed to represent the
Corresponding QUIDS having a principal amount equal to the stated liquidation
preference of such series of QUIPS, and bearing accrued and unpaid interest in
an amount equal to the accrued and unpaid Distributions on such series of QUIPS
until such certificates are presented to the Administrative Trustees or their
agent for transfer or reissuance.
There can be no assurance as to the market prices for the QUIPS or the
Corresponding QUIDS that may be distributed in exchange for QUIPS if a
dissolution and liquidation of an Issuer were to occur. Accordingly, the QUIPS
that an investor may purchase, or the Corresponding QUIDS that the investor may
receive on dissolution and liquidation of an Issuer, may trade at a discount to
the price that the investor paid to purchase the QUIPS.
REDEMPTION PROCEDURES
QUIPS redeemed on each Redemption Date shall be redeemed at the Redemption
Price with the applicable proceeds from the contemporaneous redemption of the
Corresponding QUIDS. Redemptions of the QUIPS shall be made and the Redemption
Price shall be payable on each Redemption Date only to the extent that the
related Issuer has funds on hand available for the payment of such Redemption
Price. See "--Subordination of Common Securities."
If an Issuer gives a notice of redemption in respect of its QUIPS, then, by
12:00 noon, New York City time, on the Redemption Date, to the extent funds are
available, the Property Trustee will deposit irrevocably 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 holders of such
QUIPS. See "--Book-Entry Issuance." If such QUIPS are no longer in book-entry
form, the Issuer, to the extent funds are available, will irrevocably deposit
with the paying agent for such QUIPS 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 QUIPS. Notwithstanding the foregoing,
Distributions payable on or prior to the Redemption Date for any QUIPS called
for redemption shall be payable to the holders of such QUIPS on the relevant
record dates for the related Distribution Dates. If notice of redemption shall
have been given and funds deposited as required, then upon the date of such
deposit, all rights of the holders of such QUIPS so called for redemption will
cease, except the right of the holders of such QUIPS to receive the Redemption
Price, but without interest on such Redemption Price, and such QUIPS will cease
to be outstanding. In the event that any date fixed for redemption of QUIPS is
not a Business Day, then payment of the Redemption Price payable on such date
will be made on the next succeeding day which is a Business Day (and without any
interest or other
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payment in respect of any such delay), except that, if such Business Day falls
in the next calendar year, such payment will be made on the immediately
preceding Business Day. In the event that payment of the Redemption Price in
respect of QUIPS called for redemption is improperly withheld or refused and not
paid either by the Issuer or by Nevada Power pursuant to the Guarantee as
described under "Description of Guarantees," Distributions on such QUIPS will
continue to accrue at the then applicable rate, from the Redemption Date
originally established by the Issuer for such QUIPS to the date such Redemption
Price is actually paid, in which case the actual payment date will be the date
fixed for redemption for purposes of calculating the Redemption Price.
Subject to applicable law (including, without limitation, United States
federal securities law), Nevada Power or its subsidiaries may at any time and
from time to time purchase outstanding QUIPS by tender, in the open market or by
private agreement.
Payment of the Redemption Price on the QUIPS and any distribution of
Corresponding QUIDS to holders of QUIPS shall be made to the applicable record
holders thereof as they appear on the register for such QUIPS on the relevant
record date, which shall be one Business Day prior to the relevant Redemption
Date or liquidation date, as applicable; provided, however, that in the event
that any QUIPS are not in book-entry form, the relevant record date for such
QUIPS shall be a date at least 15 days prior to the Redemption Date or
liquidation date, as applicable, as specified in the applicable Prospectus
Supplement.
If less than all of the QUIPS and Common Securities issued by an Issuer are
to be redeemed on a Redemption Date, then the aggregate Liquidation Amount of
such QUIPS and Common Securities to be redeemed shall be allocated pro rata
among the QUIPS and the Common Securities. The particular QUIPS to be redeemed
shall be selected on a pro rata basis not more than 60 days prior to the
Redemption Date by the Property Trustee from the outstanding QUIPS 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 portions (equal to $25 or an integral multiple of $25 in excess thereof) of
the liquidation preference of QUIPS of a denomination larger than $25. The
Property Trustee shall promptly notify the trust registrar in writing of the
QUIPS selected for redemption and, in the case of any QUIPS selected for partial
redemption, the liquidation preference thereof to be redeemed. For all purposes
of each Trust Agreement, unless the context otherwise requires, all provisions
relating to the redemption of QUIPS shall relate, in the case of any QUIPS
redeemed or to be redeemed only in part, to the portion of the aggregate
liquidation preference of QUIPS which has been or is to be redeemed.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the Redemption Date to each Holder of QUIDS to be redeemed at its
registered address. Unless Nevada Power defaults in payment of the Redemption
Price, on and after the Redemption Date interest will cease to accrue on such
QUIDS or portions thereof called for redemption.
SUBORDINATION OF COMMON SECURITIES
Payment of Distributions on, and the Redemption Price of, each Issuer's
QUIPS and Common Securities, as applicable, shall be made pro rata based on the
Liquidation Amount of such QUIPS and Common 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 on, or
Redemption Price of, any of the Issuer's Common Securities, and no other payment
on account of the redemption, liquidation or other acquisition of such Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions on all of the Issuer's outstanding QUIPS 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 of the
Issuer's outstanding QUIPS then called for redemption, 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, the Issuer's QUIPS then due and payable.
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In the case of any Event of Default resulting from a Debenture Event of
Default, Nevada Power as holder of such Issuer's Common Securities will be
deemed to have waived any right to act with respect to any such Event of Default
under the applicable Trust Agreement until the effect of all such Events of
Default with respect to the Issuer's QUIPS have been cured, waived or otherwise
eliminated. Until any such Events of Default under the applicable Trust
Agreement with respect to the QUIPS have been so cured, waived or otherwise
eliminated, the Property Trustee shall act solely on behalf of the holders of
such QUIPS and not on behalf of Nevada Power as holder of the Issuer's Common
Securities, and only the holders of such QUIPS will have the right to direct the
Property Trustee to act on their behalf.
LIQUIDATION DISTRIBUTION UPON TERMINATION
Pursuant to each Trust Agreement, each Issuer shall automatically terminate
upon expiration of its term and shall terminate on the first to occur of: (i)
certain events of bankruptcy, dissolution or liquidation of Nevada Power; (ii)
the distribution of a Like Amount of the Corresponding QUIDS to the holders of
its QUIPS and Common Securities, if Nevada Power, as Depositor, has given
written direction to the Property Trustee to terminate such Issuer (which
direction is optional and wholly within the discretion of Nevada Power, as
Depositor); (iii) the redemption of all of the Issuer's QUIPS and Common
Securities following a Special Event; (iv) the redemption of all of the Issuer's
QUIPS as described under "Description of QUIPS-- Redemption--Mandatory
Redemption;" and (v) the entry by a court of competent jurisdiction of an order
for the dissolution of the Issuer.
If an early termination occurs as described in clause (i), (ii) or (v)
above, the Issuer shall be liquidated by the Issuer Trustees as expeditiously as
the Issuer Trustees determine to be possible by distributing, after satisfaction
of liabilities to creditors of such Issuer as provided by applicable law, to the
holders of such QUIPS and Common Securities a Like Amount of the Corresponding
QUIDS, 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 the Issuer available for distribution to holders, after satisfaction
of liabilities to creditors of such Issuer as provided by applicable law, an
amount equal to, in the case of holders of QUIPS, the aggregate of the
liquidation preference 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 such Issuer has
insufficient assets available to pay in full the aggregate Liquidation
Distribution, then the amounts payable directly by such Issuer on its QUIPS
shall be paid on a pro rata basis. The holder(s) of such Issuer's Common
Securities will be entitled to receive distributions upon any such liquidation
pro rata with the holders of its QUIPS, except that if a Debenture Event of
Default has occurred and is continuing, the QUIPS shall have a priority over the
Common Securities. A Supplemental Indenture may provide that if an early
termination occurs as described in clause (v) above, the Corresponding QUIDS may
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 each
Trust Agreement (an "Event of Default") with respect to the QUIPS issued
thereunder (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 under the Indenture
(see "Description of QUIDS--Debenture Events of Default"); or
(ii) default by the Property Trustee 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 Property Trustee in the payment of any Redemption
Price of any QUIPS or Common Security when it becomes due and payable; or
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(iv) default in the performance, or breach, in any material respect, of
any covenant or warranty of the Issuer Trustees in such Trust Agreement
(other than a covenant or warranty a default in the performance of which or
the breach of which is 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 defaulting Issuer
Trustee or Trustees by the holders of at least 25% in aggregate liquidation
preference of the outstanding QUIPS of the applicable Issuer, a written
notice specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" under such Trust
Agreement; or
(v) the occurrence of certain events of bankruptcy or insolvency with
respect to the Property Trustee and the failure by Nevada Power to appoint a
successor Property Trustee within 60 days thereof.
Within five Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit
notice of such Event of Default to the holders of such Issuer's QUIPS, the
Administrative Trustees and Nevada Power, as Depositor, unless such Event of
Default shall have been cured or waived. Nevada Power, as Depositor, and the
Administrative Trustees are required to file annually with the Property Trustee
a certificate as to whether or not they are in compliance with all the
conditions and covenants applicable to them under each Trust Agreement.
If, in the event of a Debenture Event of Default, the Debenture Trustee
fails, or the holders of not less than 25% in principal amount of the
outstanding QUIDS fail, to declare the principal of all of the QUIDS to be
immediately due and payable, the holders of at least 25% in aggregate
liquidation preference of the QUIPS then outstanding shall have such right.
If a Debenture Event of Default has occurred and is continuing, the QUIPS
shall have a preference over the Common Securities upon termination of each
Issuer as described above. See "--Liquidation Distribution Upon Termination."
The existence of an Event of Default does not entitle the holders of QUIPS to
accelerate the maturity thereof.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF QUIPS
If an Event of Default has occurred and is continuing, then the holders of
QUIPS would rely on the enforcement by the Debenture Trustee of its rights as a
holder of the related QUIDS against Nevada Power. Notwithstanding the foregoing,
if an Event of Default has occurred and is continuing and such event is
attributable to the failure of Nevada Power to pay interest or principal on the
related QUIDS on the date such interest or principal is otherwise payable (or in
the case of redemption, on the redemption date), then a holder of QUIPS may
directly institute a proceeding against Nevada Power for enforcement of payment
to such holder of the principal of or interest on the related QUIDS having a
principal amount equal to the aggregate liquidation preference of the QUIPS of
such holder (a "Direct Action") after the respective due date specified in the
related QUIDS. In connection with such Direct Action, Nevada Power will be
subrogated to the rights of such holder of QUIPS under the Trust Agreement to
the extent of any payment made by Nevada Power to such holder of QUIPS in such
Direct Action.
REMOVAL OF ISSUER TRUSTEES
Unless a Debenture Event of Default has occurred and is continuing, any
Issuer Trustee may be removed at any time by the holder of the Common
Securities. If a Debenture Event of Default has occurred and is continuing, the
Issuer Trustees may be removed at such time by the holders of a majority in
Liquidation Amount of the outstanding QUIPS. No resignation or removal of an
Issuer Trustee and no appointment of a successor trustee shall be effective
until the acceptance of appointment by the successor trustee in accordance with
the provisions of the applicable Trust Agreement.
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CO-TRUSTEES AND SEPARATE PROPERTY TRUSTEE
Unless an Event of Default has occurred and is 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, Nevada Power, as the holder of the Common Securities, and the
Administrative Trustees shall have power to appoint one or more persons either
to act as a 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 applicable Trust Agreement. In case a Debenture Event of
Default has occurred and is continuing, the Property Trustee alone shall have
power to make such appointment.
MERGER OR CONSOLIDATION OF ISSUER TRUSTEES
Any corporation into which the Property Trustee, the Delaware Trustee or any
Administrative Trustee that is not a natural person 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 Trustee shall be a party, or
any corporation succeeding to all or substantially all the corporate trust
business of such Trustee, shall be the successor of such Trustee under each
Trust Agreement, provided such corporation shall be otherwise qualified and
eligible.
MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF THE ISSUERS
An Issuer may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other Person, except as
described below. An Issuer may, at the request of Nevada Power, with the consent
of the Administrative Trustees and without the consent of or notice to the
holders of the QUIPS, merge with or into, consolidate, amalgamate, be replaced
by or convey, transfer or lease its properties and assets substantially as an
entirety to a trust organized as such under the laws of any State; provided that
(i) such successor entity either (a) expressly assumes all of the obligations of
such Issuer with respect to the QUIPS or (b) substitutes for the QUIPS other
securities having substantially the same terms as the QUIPS (the "Successor
Securities") so long as the Successor Securities rank the same as the QUIPS rank
in priority with respect to distributions and payments upon liquidation,
redemption and otherwise, (ii) Nevada Power expressly appoints a trustee of such
successor entity possessing the same powers and duties as the Property Trustee
as the holder of the Corresponding QUIDS, (iii) the Successor Securities are
listed, or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or other organization on which the
QUIPS are then listed, if any, (iv) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not cause the QUIPS (including
any Successor Securities) to be downgraded by any nationally recognized
statistical rating organization, (v) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the holders of the QUIPS (including any Successor
Securities) in any material respect, (vi) such successor entity has a purpose
identical to that of the Issuer, (vii) prior to such merger, consolidation,
amalgamation, replacement, conveyance, transfer, or lease, Nevada Power has
received an opinion from independent counsel to the Issuer experienced in such
matters to the effect that (a) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the holders of the QUIPS (including any Successor
Securities) in any material respect and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, neither
the Issuer nor such successor entity will be required to register as an
investment company under the Investment Company Act, and (viii) Nevada Power or
any permitted successor or assignee owns all of the Common Securities of such
successor entity and guarantees the obligations of such successor entity under
the Successor Securities at least to the extent provided by the
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Guarantee. Notwithstanding the foregoing, an Issuer shall not, except with the
consent of holders of 100% in aggregate liquidation preference of the QUIPS,
consolidate, amalgamate, merge with or into, be replaced by or convey, transfer
or lease its properties and assets substantially as an entirety to any other
entity or permit any other entity to consolidate, amalgamate, merge with or
into, or replace it or acquire or lease its properties and assets substantially
as an entirety if such consolidation, amalgamation, merger, replacement,
conveyance, transfer or lease would cause the Issuer or the successor entity to
be classified as other than a grantor trust for United States federal income tax
purposes.
VOTING RIGHTS; AMENDMENT OF EACH TRUST AGREEMENT
Except as provided below and under "Description of Guarantees--Amendments
and Assignment" and as otherwise required by law and the applicable Trust
Agreement, the holders of the QUIPS will have no voting rights.
Each Trust Agreement may be amended from time to time by Nevada Power and
the Issuer Trustees, without the consent of the holders of the QUIPS (i) to cure
any ambiguity, correct or supplement any provisions in such Trust Agreement that
may be inconsistent with any other provision, or to make any other provisions
with respect to matters or questions arising under such Trust Agreement that
shall not be inconsistent with the other provisions of such Trust Agreement, or
(ii) to modify, eliminate or add to any provisions of such Trust Agreement to
such extent as shall be necessary to ensure that the Issuer will be classified
for United States federal income tax purposes as a grantor trust at all times
that any QUIPS and Common Securities are outstanding or to ensure that the
Issuer will not be required to register as an "investment company" under the
Investment Company Act, provided, however, that in the case of clause (i), such
action shall not adversely affect in any material respect the interests of any
holder of QUIPS or Common Securities, and any amendments of such Trust Agreement
shall become effective when notice thereof is given to the holders of QUIPS and
Common Securities. Each Trust Agreement may be amended by the Issuer Trustees
and Nevada Power with (i) the consent of holders representing a majority (based
upon Liquidation Amounts) of the outstanding QUIPS and Common Securities and
(ii) receipt by the Issuer Trustees of an opinion of counsel to the effect that
such amendment or the exercise of any power granted to the Issuer Trustees in
accordance with such amendment will not affect the Issuer's status as a grantor
trust for United States federal income tax purposes or the Issuer's exemption
from status of an "investment company" under the Investment Company Act,
provided, further that without the consent of each holder of QUIPS and Common
Securities, such Trust Agreement may not be amended to (i) change the amount or
timing of any Distribution on the QUIPS and Common Securities or otherwise
adversely affect the amount of any Distribution required to be made in respect
of the QUIPS and Common Securities as of a specified date or (ii) restrict the
right of a holder of QUIPS and Common Securities to institute suit for the
enforcement of any such payment on or after such date.
So long as any Corresponding QUIDS are held by the Property Trustee, the
Issuer 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 Property Trustee with respect to such
Corresponding QUIDS, (ii) waive any past default that is waiveable under the
Indenture, (iii) exercise any right to rescind or annul a declaration that the
principal of all the QUIDS shall be due and payable or (iv) consent to any
amendment, modification or termination of the Indenture or such Corresponding
QUIDS, where such consent shall be required, without, in each case, obtaining
the prior approval of the holders of a majority in aggregate liquidation
preference of all outstanding corresponding QUIPS; provided, however, that where
a consent under the Indenture would require the consent of each holder of
Corresponding QUIDS affected thereby, no such consent shall be given by the
Property Trustee without the prior consent of each holder of the corresponding
QUIPS. The Issuer Trustees shall not revoke any action previously authorized or
approved by a vote of the holders of the QUIPS except by subsequent vote of the
holders of the QUIPS. The Property Trustee shall notify each holder of record of
the QUIPS of any notice of default with respect to the Corresponding QUIDS. In
addition to obtaining the foregoing
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approvals of the holders of the QUIPS, prior to taking any of the foregoing
actions, the Issuer Trustees shall obtain an opinion of counsel experienced in
such matters to the effect that the Issuer will not be classified as a
corporation for United States federal income tax purposes on account of such
action.
Any required approval of holders of QUIPS may be given at a meeting of
holders of QUIPS convened for such purpose or pursuant to written consent. The
Property Trustee will cause a notice of any meeting at which holders of QUIPS
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 record of QUIPS in
the manner set forth in the applicable Trust Agreement.
No vote or consent of the holders of QUIPS will be required for an Issuer to
redeem and cancel its QUIPS in accordance with the applicable Trust Agreement.
Notwithstanding that holders of QUIPS are entitled to vote or consent under
any of the circumstances described above, any of the QUIPS that are owned by
Nevada Power, the Issuer Trustees or any affiliate of Nevada Power or any Issuer
Trustees, shall, for purposes of such vote or consent, be treated as if they
were not outstanding.
PAYMENT AND PAYING AGENCY
Payments in respect of the QUIPS shall be made to DTC, which shall credit
the relevant accounts at DTC on the applicable Distribution Dates or, if any
Issuer's QUIPS are not held by DTC, such payments shall be made by check mailed
to the address of the holder entitled thereto as such address shall appear on
the Register. Unless otherwise specified in the applicable Prospectus
Supplement, the paying agent (the "Paying Agent") shall initially be the
Property Trustee and any co-paying agent chosen by the Property Trustee and
acceptable to the Administrative Trustees and Nevada Power. The Paying Agent
shall be permitted to resign as Paying Agent upon 30 days' written notice to the
Property Trustee and Nevada Power. In the event that the Property Trustee shall
no longer be the Paying Agent, the Administrative Trustees shall appoint a
successor (which shall be a bank or trust company acceptable to the
Administrative Trustees and Nevada Power) to act as Paying Agent.
BOOK-ENTRY ISSUANCE
DTC will act as securities depositary for all of the QUIPS. The QUIPS will
be issued only as fully-registered securities registered in the name of Cede &
Co. (DTC's nominee). One or more fully-registered global certificates will be
issued for the QUIPS of each Issuer, representing in the aggregate the total
number of such Issuer's QUIPS, 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 Exchange 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,
Inc., 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
through or maintain custodial relationships with Direct Participants, either
directly or indirectly ("Indirect Participants"). The rules applicable to DTC
and its Participants are on file with the Commission.
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Purchases of QUIPS within the DTC system must be made by or through Direct
Participants, which will receive a credit for the QUIPS on DTC's records. The
ownership interest of each actual purchaser of each QUIPS ("Beneficial Owner")
is in turn to be recorded on the Direct and Indirect 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 Direct or Indirect Participants through which the Beneficial
Owners purchased QUIPS. Transfers of ownership interests in the QUIPS 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 QUIPS, except in the event that use of the
book-entry system for the QUIPS of such Issuer is discontinued.
DTC has no knowledge of the actual Beneficial Owners of the QUIPS; DTC's
records reflect only the identity of the Direct Participants to whose accounts
such QUIPS 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.
Redemption notices shall be sent to Cede & Co. as the registered holder of
the QUIPS. If less than all of an Issuer's QUIPS are being redeemed, DTC's
current practice is to determine by lot the amount of the interest of each
Direct Participant to be redeemed.
Although voting with respect to the QUIPS is limited, in those instances in
which a vote is required, neither DTC nor Cede & Co. will itself consent or vote
with respect to QUIPS. Under its usual procedures, DTC would mail an omnibus
proxy (the "Omnibus Proxy") to the Property Trustee as soon as possible after
the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting
rights to those Direct Participants to whose accounts such QUIPS are credited on
the record date (identified in a listing attached to the Omnibus Proxy).
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners and the voting
rights of Direct Participants, Indirect Participants and Beneficial Owners will
be governed by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time.
Distribution payments on the QUIPS will be made by the Property Trustee 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 and will be the responsibility of
such Participant and not of DTC, the Property Trustee, the Issuer or Nevada
Power, subject to any statutory or regulatory requirements as may be in effect
from time to time. Payment of Distributions to DTC is the responsibility of the
Property Trustee, disbursement of such payments to Direct Participants is the
responsibility of DTC, and disbursements of such payments to the Beneficial
Owners is the responsibility of Direct and Indirect Participants.
DTC may discontinue providing its services as securities depositary with
respect to any of the QUIPS at any time by giving reasonable notice to the
Property Trustee and Nevada Power. In the event that a successor securities
depositary is not obtained, definitive QUIPS certificates representing such
QUIPS are required to be printed and delivered. Nevada Power, at its option, may
decide to discontinue use of the system of book-entry transfers through DTC (or
a successor depositary). After a Debenture Event of Default, the holders of a
majority in liquidation preference of QUIPS may determine to discontinue the
system of book-entry transfers through DTC. In any such event, definitive
certificates for such Issuer's QUIPS 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 Issuers and Nevada Power believe to be
accurate, but the Issuers and Nevada Power
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<PAGE>
assume no responsibility for the accuracy thereof. Neither the Issuers nor
Nevada Power has any responsibility for the performance by DTC or its
Participants of their respective obligations as described herein or under the
rules and procedures governing their respective operations.
REGISTRAR AND TRANSFER AGENT
Unless otherwise specified in the applicable Prospectus Supplement, the
Property Trustee will act as registrar and transfer agent for the QUIPS.
Registration of transfers of QUIPS will be effected without charge by or on
behalf of each Issuer, but upon payment of any tax or other governmental charges
that may be imposed in connection with any transfer or exchange. The Issuers
will not be required to register or cause to be registered the transfer of their
QUIPS after such QUIPS have been called for redemption.
THE TRUSTEES
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 QUIDS on behalf of the Issuers and will maintain a payment account with
respect to the QUIPS and the Common Securities, and will also act as trustee
under the Trust Agreements for the purposes of the Trust Indenture Act. See
"Events of Default; Notice." The Administrative Trustees will administer the day
to day operations of the Issuers. The Property Trustee, other than during the
occurrence and continuance of an Event of Default, undertakes to perform only
such duties as are specifically set forth in each Trust Agreement and, after
such Event of Default, must exercise the same degree of care and skill as a
prudent person would exercise or use in the conduct of his or her own affairs.
Subject to this provision, the Property Trustee is under no obligation to
exercise any of the powers vested in it by the applicable Trust Agreement at the
request of any holder of QUIPS unless it is offered reasonable indemnity against
the costs, expenses and liabilities that might be incurred thereby. If no Event
of Default has occurred and is continuing and the Property Trustee is required
to decide between alternative causes of action, construe ambiguous provisions in
the applicable Trust Agreement or is unsure of the application of any provision
of the applicable Trust Agreement, and the matter is not one on which holders of
QUIPS are entitled under such Trust Agreement to vote, then the Property Trustee
shall take such action as is directed by Nevada Power and if not so directed,
shall take such action as it deems advisable and in the best interests of the
holders of the QUIPS and the Common Securities and will have no liability except
for its own bad faith, negligence or willful misconduct.
The Administrative Trustees are authorized and directed to conduct the
affairs of and to operate the Issuers in such a way that no Issuer will be
deemed to be an "investment company" required to be registered under the
Investment Company Act or classified as an association taxable as a corporation
for United States federal income tax purposes and so that the Corresponding
QUIDS will be treated as indebtedness of Nevada Power for United States federal
income tax purposes. In this connection, Nevada Power and the Administrative
Trustees are authorized to take any action, not inconsistent with applicable
law, the certificate of trust of each Issuer or each Trust Agreement, that
Nevada Power and the Administrative Trustees 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 related QUIPS.
MISCELLANEOUS
Holders of the QUIPS have no preemptive or similar rights.
No Issuer may borrow money or issue debt or mortgage or pledge any of its
assets.
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DESCRIPTION OF GUARANTEES
Each Guarantee will be executed and delivered by Nevada Power concurrently
with the issuance by each Issuer of its QUIPS for the benefit of the holders
from time to time of such QUIPS. IBJ Schroder will act as indenture trustee
("Guarantee Trustee") under each Guarantee for the purposes of compliance with
the Trust Indenture Act and each Guarantee will be qualified as an indenture
under the Trust Indenture Act. This summary of certain provisions of the
Guarantees does not purport to be complete and is subject to, and qualified in
its entirety by reference to, all of the provisions of each Guarantee, including
the definitions therein of certain terms, and the Trust Indenture Act. The form
of the Guarantee has been filed as an exhibit to the Registration Statement of
which this Prospectus forms a part. Reference in this summary to QUIPS means
that Issuer's QUIPS to which a Guarantee relates. The Guarantee Trustee will
hold each Guarantee for the benefit of the holders of the related Issuer's
QUIPS.
GENERAL
Nevada Power will irrevocably agree to pay in full on a subordinated basis,
to the extent described herein, the Guarantee Payments (as defined below) to the
holders of the QUIPS, as and when due, regardless of any defense, right of
set-off or counterclaim that such Issuer may have or assert other than the
defense of payment. The following payments with respect to the QUIPS, to the
extent not paid by or on behalf of the related Issuer (the "Guarantee
Payments"), will be subject to the Guarantee: (i) any accumulated and unpaid
Distributions required to be paid on such QUIPS, to the extent that such Issuer
has funds on hand available therefor at such time, (ii) the Redemption Price
with respect to any QUIPS called for redemption to the extent that such Issuer
has funds on hand available therefor at such time, or (iii) upon a voluntary or
involuntary dissolution, winding up or liquidation of such Issuer (unless the
Corresponding QUIDS are distributed to holders of such QUIPS), the lesser of (a)
the Liquidation Distribution and (b) the amount of assets of such Issuer
remaining available for distribution to holders of QUIPS. Nevada Power's
obligation to make a Guarantee Payment may be satisfied by direct payment of the
required amounts by Nevada Power to the holders of the applicable QUIPS or by
causing the Issuer to pay such amounts to such holders.
Each Guarantee will be an irrevocable guarantee on a subordinated basis of
payment of the related Issuer's obligations under the QUIPS, but will apply only
to the extent that such related Issuer has funds sufficient to make such
payments, and is not a guarantee of collection.
If Nevada Power does not make interest payments on the Corresponding QUIDS
held by the Issuer, the Issuer will not be able to pay Distributions on the
QUIPS and will not have funds legally available therefor. Each Guarantee will
rank subordinate and junior in right of payment to all Senior Debt of Nevada
Power. See "--Status of the Guarantees." Except as otherwise provided in the
applicable Prospectus Supplement, the Guarantees do not limit the incurrence or
issuance of other secured or unsecured debt of Nevada Power, whether under the
Indenture or any existing or other indenture that Nevada Power may enter into in
the future or otherwise, including, without limitation, Nevada Power's Indenture
of Mortgage and Deed of Trust dated October 1, 1953 entered into with Bankers
Trust Company, together with supplemental indentures heretofore or hereafter
entered into.
Nevada Power has, through the applicable Guarantee, the applicable Trust
Agreement, the QUIDS, the Indenture and the Expense Agreement, taken together,
fully, irrevocably and unconditionally guaranteed all of the Issuer's
obligations under the QUIPS. 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, irrevocable and unconditional guarantee of the
Issuer's obligations under the QUIPS. See "Relationship Among the QUIPS, the
Corresponding QUIDS and the Guarantees."
27
<PAGE>
STATUS OF THE GUARANTEES
Each Guarantee will constitute an unsecured obligation of Nevada Power and
will rank subordinate and junior in right of payment to all Senior Debt.
Each Guarantee will rank PARI PASSU with all other Guarantees issued by
Nevada Power. Each 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). Each
Guarantee will be held for the benefit of the holders of the related QUIPS. Each
Guarantee will not be discharged except by payment of the Guarantee Payments in
full to the extent not paid by the Issuer or upon distribution to the holders of
the QUIPS of the Corresponding QUIDS. None of the Guarantees places a limitation
on the amount of additional Senior Debt that may be incurred by Nevada Power.
The electric utility business is capital intensive and Nevada Power anticipates
that from time to time it will incur substantial additional indebtedness
constituting Senior Debt.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes which do not materially adversely affect
the rights of holders of the related QUIPS (in which case no vote will be
required), no Guarantee may be amended without the prior approval of the holders
of a majority of the aggregate liquidation preference of such outstanding QUIPS.
The manner of obtaining any such approval will be as set forth under
"Description of QUIPS--Voting Rights; Amendment of Each Trust Agreement." All
guarantees and agreements contained in each Guarantee shall bind the successors,
assigns, receivers, trustees and representatives of Nevada Power and shall inure
to the benefit of the holders of the related QUIPS then outstanding.
EVENTS OF DEFAULT
An event of default under each Guarantee will occur upon the failure of
Nevada Power to perform any of its payment or other obligations thereunder. The
holders of a majority in aggregate Liquidation Amount of the related QUIPS 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 such Guarantee or to
direct the exercise of any trust or power conferred upon the Guarantee Trustee
under such Guarantee.
Any holder of the QUIPS may institute a legal proceeding directly against
Nevada Power to enforce its rights under such Guarantee without first
instituting a legal proceeding against the Issuer, the Guarantee Trustee or any
other person or entity.
Nevada Power, as guarantor, is required to file annually with the Guarantee
Trustee a certificate as to whether or not Nevada Power is in compliance with
all the conditions and covenants applicable to it under the Guarantee.
INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The Guarantee Trustee, other than during the occurrence and continuance of a
default by Nevada Power in performance of any Guarantee, undertakes to perform
only such duties as are specifically set forth in each Guarantee and, after
default with respect to any Guarantee, must exercise the same degree of care and
skill as a prudent person would exercise or use 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 any Guarantee at the request of
any holder of any QUIPS unless it is offered reasonable indemnity against the
costs, expenses and liabilities that might be incurred thereby.
28
<PAGE>
TERMINATION OF THE GUARANTEE
Each Guarantee will terminate and be of no further force and effect upon
full payment of the Redemption Price of the related QUIPS, upon full payment of
the amounts payable upon liquidation of the related Issuer or upon distribution
of Corresponding QUIDS to the holders of the related QUIPS. Each Guarantee will
continue to be effective or will be reinstated, as the case may be, if at any
time any holder of the related QUIPS must restore payment of any sums paid under
such QUIPS or such Guarantee.
GOVERNING LAW
Each Guarantee will be governed by and construed in accordance with the laws
of the State of Nevada.
THE EXPENSE AGREEMENT
Pursuant to an Expense Agreement entered into by Nevada Power under each
Trust Agreement (the "Expense Agreement"), Nevada Power will irrevocably and
unconditionally guarantee to each person or entity to whom the Issuer becomes
indebted or liable, the full payment of any costs, expenses or liabilities of
the Issuer, other than obligations of the Issuer to pay to the holders of any
QUIPS or other similar interests in the Issuer the amounts due such holders
pursuant to the terms of the QUIPS or such other similar interests, as the case
may be.
DESCRIPTION OF CORRESPONDING QUIDS
The Corresponding QUIDS are to be issued in one or more series under the
Indenture with terms corresponding to the terms of the related QUIPS. See
"Description of QUIDS." This summary of certain terms and provisions of, or
relating to, Corresponding QUIDS and the Indenture does not purport to be
complete and is subject to, and is qualified in its entirety by reference to,
the Indenture, the form of which is filed as an exhibit to the Registration
Statement of which this Prospectus forms a part, and to the Trust Indenture Act.
Whenever particular defined terms of the Indenture (as supplemented or amended
from time to time) are referred to herein or in a Prospectus Supplement, such
defined terms are incorporated herein or therein by reference.
GENERAL
Concurrently with the issuance of each Issuer's QUIPS, such Issuer will
invest the proceeds thereof and the consideration paid by Nevada Power for the
Common Securities in a series of Corresponding QUIDS issued by Nevada Power to
such Issuer. Each series of Corresponding QUIDS will be in the principal amount
equal to the aggregate stated Liquidation Amount of the related QUIPS plus
Nevada Power's concurrent investment in the Common Securities and will rank PARI
PASSU with all other series of QUIDS. The Corresponding QUIDS will be unsecured
and subordinate and junior in right of payment to the extent and in the manner
set forth in the Indenture to all Senior Debt of Nevada Power. See "Description
of QUIDS--Subordination" and the Prospectus Supplement relating to any offering
of related QUIPS.
OPTIONAL REDEMPTION
Unless otherwise specified in the applicable Prospectus Supplement, Nevada
Power may, at its option, redeem the Corresponding QUIDS of any series in whole
at any time or in part from time to time. Except as otherwise set forth in the
applicable Prospectus Supplement, the redemption price for any Corresponding
QUIDS so redeemed shall be equal to any accrued and unpaid interest thereon to
the date fixed for redemption, plus the principal amount thereof. See
"Description of QUIDS--Redemption."
29
<PAGE>
If a Special Event in respect of an Issuer shall occur and be continuing,
Nevada Power may, at its option, redeem the Corresponding QUIDS at any time
within 90 days of the occurrence of such Special Event, in whole but not in
part, subject to the provisions of the Indenture. The redemption price for any
Corresponding QUIDS shall be equal to 100% of the principal amount of such
Corresponding QUIDS then outstanding plus accrued and unpaid interest to the
date fixed for redemption.
For so long as the applicable Issuer is the holder of all the outstanding
series of Corresponding QUIDS, the proceeds of any such redemption will be used
by the Issuer to redeem the Corresponding QUIPS in accordance with their terms.
Nevada Power may not redeem a series of Corresponding QUIDS in part unless all
accrued and unpaid interest has been paid in full on all outstanding
Corresponding QUIDS of such series for all interest periods terminating on or
prior to the Redemption Date.
CERTAIN COVENANTS OF NEVADA POWER
Nevada Power covenants in the Indenture as to each series of Corresponding
QUIDS that if and so long as (i) the Issuer of the related series of QUIPS and
Common Securities is the holder of all such Corresponding QUIDS, (ii) a Tax
Event in respect of such Issuer has occurred and is continuing and (iii) Nevada
Power has elected, and has not revoked such election, to pay Additional Sums in
respect of such QUIPS and Common Securities, Nevada Power will pay to such
Issuer such Additional Sums. Nevada Power also covenants, as to each series of
Corresponding QUIDS, that it will not, and will not permit any subsidiary of
Nevada Power to, (i) declare or pay any dividends or distributions on, or
redeem, purchase, acquire, or make a liquidation payment with respect to, any of
Nevada Power's capital stock or (ii) make any payment of principal, interest or
premium, if any, on or repay or repurchase or redeem, or make any sinking fund
payment with respect to, any indebtedness (including other Corresponding QUIDS)
that rank PARI PASSU with or junior in right of payment to the Corresponding
QUIDS or make any guarantee payments with respect to any guarantee by Nevada
Power of any indebtedness if such guarantee ranks PARI PASSU or junior in right
of payment to the Series A QUIDS (other than (a) dividends or distributions in
Common Stock of Nevada Power, (b) redemptions or purchases of rights pursuant to
Nevada Power's Stock Rights Purchase Plan or any successor to such Stock Rights
Purchase Plan, and the declaration of a dividend of such rights or the issuance
of Preferred Stock under such plans in the future, (c) payments under any
Guarantee, (d) purchases of Common Stock related to the issuance of Common Stock
under the Stock Purchase and Dividend Reinvestment Plan and any of Nevada
Power's benefit plans for its directors, officers or employees, and (e)
purchases of Common Stock required to prevent the loss or secure the renewal or
reinstatement of any government license or franchise held by Nevada Power or any
of its subsidiaries) if at such time (i) there shall have occurred any event
that constitutes, or with the giving of notice or the lapse of time, or both,
would constitute, an "Event of Default" under the Indenture with respect to
Corresponding QUIDS of such series, (ii) Nevada Power shall be in default with
respect to its payment of any obligations under the related Guarantee or (iii)
Nevada Power shall have given notice of its selection of an Extension Period as
provided in the Indenture with respect to Corresponding QUIDS of such series and
shall not have rescinded such notice, or such Extension Period, or any extension
thereof, shall be continuing. Nevada Power will also covenant, as to each series
of Corresponding QUIDS, (i) to maintain directly or indirectly 100% ownership of
the Common Securities of the Issuer to which Corresponding QUIDS have been
issued, provided that certain successors which are permitted pursuant to the
Indenture may succeed to Nevada Power's ownership of the Common Securities, (ii)
not to voluntarily terminate, wind-up or liquidate any Issuer, except (a) in
connection with a distribution of Corresponding QUIDS to the holders of the
QUIPS in liquidation of such Issuer or (b) in connection with certain mergers,
consolidations or amalgamations permitted by the related Trust Agreement, (iii)
remain the sole Depositor under each Trust Agreement and timely perform in all
material respects all of its duties as Depositor and (iv) to use its reasonable
efforts, consistent with the terms and provisions of the related Trust
Agreement, to cause such Issuer to remain classified as a grantor trust and not
as an association taxable as a corporation for United States federal income tax
purposes.
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RELATIONSHIP AMONG THE QUIPS,
THE CORRESPONDING QUIDS AND THE GUARANTEES
FULL AND UNCONDITIONAL GUARANTEE
Payments of Distributions and other amounts due on the QUIPS (to the extent
the Issuer has funds available for the payment of such Distributions) are
irrevocably guaranteed by Nevada Power, on a subordinated basis, as and to the
extent set forth under "Description of Guarantees." Taken together, Nevada
Power's obligations under each series of QUIDS, the Indenture, the related Trust
Agreement, the related Expense Agreement and the related Guarantee provide, in
the aggregate, a full, irrevocable and unconditional guarantee of payments of
distributions and other amounts due on the related series of QUIPS. 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, irrevocable and
unconditional guarantee of the Issuer's obligations under the QUIPS. If and to
the extent that Nevada Power does not make payments on any series of
Corresponding QUIDS, such Issuer will not pay Distributions or other amounts due
on related QUIPS. The Guarantees do not cover payment of Distributions when the
related Issuer does not have sufficient funds to pay such Distributions. In such
event, a holder of a series of QUIPS may institute a legal proceeding directly
against Nevada Power to enforce payment of such Distributions to such holder
after the respective due dates. The obligations of Nevada Power under each
Guarantee are subordinate and junior in right of payment to all Senior Debt of
Nevada Power.
SUFFICIENCY OF PAYMENTS
As long as payments of interest and other payments are made when due (taking
account of any Extension Period) on each series of Corresponding QUIDS, such
payments will be sufficient to cover Distributions and other payments due on the
related QUIPS, primarily because (i) the aggregate principal amount of each
series of Corresponding QUIDS will be equal to the sum of the aggregate stated
liquidation amount of the related QUIPS and related Common Securities; (ii) the
interest rate and interest and other payment dates on each series of
Corresponding QUIDS will match the Distribution rate and Distribution and other
payment dates for the related QUIPS; (iii) Nevada Power shall pay for all and
any costs, expenses and liabilities of such Issuer except the Issuer's
obligations to holders of its QUIPS under such QUIPS; and (iv) each Trust
Agreement further provides that the Issuer will not engage in any activity that
is not consistent with the limited purposes of such Issuer.
Notwithstanding anything to the contrary in the Indenture, Nevada Power has
the right to set-off any payment it is otherwise required to make thereunder
with and to the extent Nevada Power has theretofore made, or is concurrently on
the date of such payment making, a payment under the related Guarantee.
ENFORCEMENT RIGHTS OF HOLDERS OF QUIPS
A holder of any related QUIPS may institute a legal proceeding directly
against Nevada Power to enforce its rights under the related Guarantee without
first instituting a legal proceeding against the Guarantee Trustee, the related
Issuer or any other person or entity.
A default or event of default under any Senior Debt of Nevada Power will not
constitute a default or Event of Default under the Indenture. However, in the
event of payment defaults under, or acceleration of, Senior Debt of Nevada
Power, the subordination provisions of the Indenture provide that no payments
may be made in respect of the Corresponding QUIDS until such Senior Debt has
been paid in full or any payment default thereunder has been cured or waived.
Failure to make required payments on any series of Corresponding QUIDS would
constitute an Event of Default under the Indenture.
31
<PAGE>
LIMITED PURPOSE OF ISSUERS
Each Issuer's QUIPS evidence a beneficial interest in such Issuer, and each
Issuer exists for the exclusive purpose of (i) issuing and selling its QUIPS and
Common Securities, (ii) using the proceeds from the sale of such QUIPS and
Common Securities to acquire a corresponding series of Corresponding QUIDS
issued by Nevada Power, (iii) receiving payments to be made with respect to the
QUIDS and disbursing such payments in accordance with the terms of the Trust
Agreements and (iv) engaging in only those other activities necessary,
convenient or incidental thereto. A principal difference between the rights of a
holder of a QUIPS and a holder of a Corresponding QUIDS is that a holder of a
Corresponding QUIDS is entitled to receive from Nevada Power the principal
amount of and interest accrued on Corresponding QUIDS held, while a holder of
QUIPS is entitled to receive Distributions from such Issuer (or from Nevada
Power under the applicable Guarantee) if and to the extent such Issuer has funds
available for the payment of such Distributions.
RIGHTS UPON TERMINATION
Upon any voluntary or involuntary termination, winding-up or liquidation of
any Issuer involving the liquidation of the Corresponding QUIDS, the holders of
the related QUIPS will be entitled to receive, out of assets held by such
Issuer, the Liquidation Distribution in cash. See "Description of QUIPS--
Liquidation Distribution Upon Termination." Upon any voluntary or involuntary
liquidation or bankruptcy of Nevada Power, the Property Trustee, as holder of
the Corresponding QUIDS, would be a subordinated creditor of Nevada Power,
subordinated in right of payment to all Senior Debt, but entitled to receive
payment in full of principal and interest before any stockholders of Nevada
Power receive payments or distributions. Because Nevada Power is the guarantor
under each Guarantee and has agreed to pay for all costs, expenses and
liabilities of each Issuer (other than the Issuer's obligations to the holders
of its QUIPS), the positions of a holder of such QUIPS and a holder of such
Corresponding QUIDS relative to other creditors and to stockholders of Nevada
Power in the event of liquidation or bankruptcy of Nevada Power would be
substantially the same.
PLAN OF DISTRIBUTION
The QUIDS and the QUIPS may be sold in a public offering to or through
underwriters or dealers designated from time to time. Nevada Power and each
Issuer may sell its QUIDS and QUIPS as soon as practicable after effectiveness
of the Registration Statement of which the Prospectus is a part. The names of
any underwriters or dealers involved in the sale of the QUIDS and QUIPS in
respect of which this Prospectus is delivered, the amount or number of QUIDS and
QUIPS to be purchased by any such underwriters and any applicable commissions or
discounts will be set forth in the Prospectus Supplement.
Underwriters may offer and sell QUIDS and QUIPS at a fixed price or prices,
which may be changed, or from time to time at market prices prevailing at the
time of sale, at prices related to such prevailing market prices or at
negotiated prices. In connection with the sale of QUIPS, underwriters may be
deemed to have received compensation from Nevada Power and/or the applicable
Issuer in the form of underwriting discounts or commissions and may also receive
commissions. Underwriters may sell QUIDS and QUIPS to or through dealers, and
such dealers may receive compensation in the form of discounts, concessions or
commissions from the underwriters.
Any underwriting compensation paid by Nevada Power and/or the applicable
Issuer to underwriters in connection with the offering of QUIDS and QUIPS, and
any discounts, concessions or commissions allowed by such underwriters to
participating dealers, will be described in a Prospectus Supplement.
Underwriters and dealers participating in the distribution of QUIDS and QUIPS
may be deemed to be underwriters, and any discounts and commissions received by
them and any profit realized by them on resale of such QUIDS and QUIPS may be
deemed to be underwriting discounts and commissions, under the Securities Act.
Underwriters and dealers may be entitled, under agreement with Nevada Power and
the applicable Issuer, to indemnification against and contribution toward
certain civil liabilities, including liabilities under the Securities Act, and
to reimbursement by Nevada Power for certain expenses.
32
<PAGE>
In connection with the offering of the QUIPS of any Issuer, such Issuer may
grant to the underwriters an option to purchase additional QUIPS to cover
over-allotments, if any, at the initial public offering price (with an
additional underwriting commission), as may be set forth in the accompanying
Prospectus Supplement. If such Issuer grants any over-allotment option, the
terms of such over-allotment option will be set forth in the Prospectus
Supplement for such QUIPS.
Underwriters and dealers may engage in transactions with, or perform
services for, Nevada Power and/or the applicable Issuer and/or any of their
affiliates in the ordinary course of business.
The QUIDS and the QUIPS will be new issues of securities and will have no
established trading market. Any underwriters to whom QUIDS and QUIPS are sold
for public offering and sale may make a market in such QUIDS and QUIPS, but such
underwriters will not be obligated to do so and may discontinue any market
making at any time without notice. Such QUIDS and QUIPS may or may not be listed
on a national securities exchange, as set forth in the applicable Prospectus
Supplement. No assurance can be given as to the liquidity of or the existence of
trading markets for any QUIDS or QUIPS.
LEGAL MATTERS
Unless otherwise set forth in the applicable Prospectus Supplement, certain
matters of Delaware law relating to the legality of the QUIPS, the validity of
the Trust Agreement and the formation of the Issuer will be passed upon by
Richards, Layton & Finger, special Delaware counsel to Nevada Power and the
Issuer. The legality of the Guarantee and QUIDS will be passed upon for Nevada
Power by Richard L. Hinckley, Vice President, Secretary and Chief Counsel for
Nevada Power and by Best Best & Krieger LLP. Certain legal matters will be
passed upon for the Underwriters by Jones, Day, Reavis & Pogue, Chicago,
Illinois. Certain matters relating to United States federal income tax
considerations will be passed upon for Nevada Power and the Series A Issuer by
their special tax counsel, Jones, Day, Reavis & Pogue, Chicago, Illinois. For
the purposes of their opinions, Best, Best & Krieger LLP and Jones, Day, Reavis
& Pogue may rely on the opinion of Mr. Hinckley as to matters governed by the
laws of the State of Nevada.
EXPERTS
The financial statements and financial statement schedule of Nevada Power
incorporated in this Prospectus by reference to Nevada Power's Annual Report on
Form 10-K for the year ended December 31, 1995 have been audited by Deloitte &
Touche LLP, independent auditors, as stated in their reports, which are
incorporated herein by reference, and have been so incorporated in reliance upon
the reports of such firm given upon their authority as experts in auditing and
accounting.
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE
PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT AND THE
PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO
BUY ANY SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS PROSPECTUS
SUPPLEMENT OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SUCH
SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL.
NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS NOR ANY
SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF NEVADA POWER COMPANY
SINCE THE DATE HEREOF OR THAT THE INFORMATION CONTAINED HEREIN OR THEREIN IS
CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
--------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PROSPECTUS SUPPLEMENT
Risk Factors.............................................................. S-4
NVP Capital I............................................................. S-7
Nevada Power Company...................................................... S-8
Ratio of Earnings to Fixed Charges........................................ S-8
Use of Proceeds........................................................... S-9
Accounting Treatment...................................................... S-9
Capitalization............................................................ S-10
Selected Financial and Operating Information.............................. S-11
Certain Terms of Series A QUIPS........................................... S-12
Certain Terms of Series A QUIDS........................................... S-14
Certain Federal Income Tax Consequences................................... S-17
Underwriting.............................................................. S-21
Legal Matters............................................................. S-22
PROSPECTUS
Available Information..................................................... 3
Incorporation of Certain Information by Reference......................... 4
Nevada Power Company...................................................... 4
Ratio of Earnings to Fixed Charges........................................ 4
Use of Proceeds........................................................... 5
The Issuers............................................................... 5
Description of QUIDS...................................................... 6
Description of QUIPS...................................................... 15
Description of Guarantees................................................. 27
Description of Corresponding QUIDS........................................ 29
Relationship Among the QUIPS, the Corresponding QUIDS and the
Guarantees.............................................................. 31
Plan of Distribution...................................................... 32
Legal Matters............................................................. 33
Experts................................................................... 33
</TABLE>
5,000,000 PREFERRED SECURITIES
NVP CAPITAL I
% CUMULATIVE QUARTERLY
INCOME PREFERRED SECURITIES,
SERIES A (QUIPS)-SM-
GUARANTEED TO THE EXTENT THE SERIES A
ISSUER HAS FUNDS, AS SET FORTH
HEREIN, BY
NEVADA POWER
COMPANY
---------
[LOGO]
---------
GOLDMAN, SACHS & CO.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated expenses in connection with the issuance and distribution of
the Securities covered by this Registration Statement, other than underwriting
discounts and commissions, are as follows:
<TABLE>
<S> <C> <C>
(a) SEC registration fee (actual)....................................... $37,878.79
(b) Printing fees and expenses.......................................... $ *
(c) Legal fees and expenses............................................. $ *
(d) Accounting fees and expenses........................................ $ *
(e) Blue Sky fees and expenses.......................................... $ *
(f) New York Stock Exchange Listing Fee................................. $ *
(g) Rating Agency Fees.................................................. $ *
(h) Trustees' Fee....................................................... $ *
(i) Other...............................................................
---------
Total............................................................... $ *
---------
---------
</TABLE>
- ------------------------
* To be completed by amendment
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
As permitted by Section 78.037 of the Nevada General Corporation Law, Nevada
Power has included in its Restated Articles of Incorporation a provision which
states that a director or officer of Nevada Power shall not be liable to Nevada
Power or its shareholders for monetary damages for breach of fiduciary duty as a
director or officer, except to the extent such limitation of liability is
prohibited by Nevada General Corporation Law as the same exists or may hereafter
be amended. Section 78.037 currently provides that any such provision may not
eliminate or limit the liability of a director or officer for (a) acts or
omissions which involve intentional misconduct, fraud or a knowing violation of
law; or (b) the payment of dividends in violation of the Nevada General
Corporation Law.
As permitted by Section 78.751 of the Nevada General Corporation Law,
Article VIII of Nevada Power's Bylaws provides for the indemnification by Nevada
Power, including suits brought by or on behalf of Nevada Power, of each
director, officer, employee or agent thereof to the fullest extent permitted by
Nevada law.
As permitted by the Nevada General Corporation Law and Article VIII of
Nevada Power's Bylaws, Nevada Power has entered into indemnity agreements with
its directors and officers that provide for indemnification of such individuals
to the fullest extent permitted under Nevada law, and Nevada Power maintains
director's and officer's liability for its directors and officers against
certain liabilities.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- --------- ---------------------------------------------------------------------------------------------------------
<C> <S>
1.01 Proposed form of Underwriting Agreement Basic Provisions for Preferred Securities.
4.01 Junior Subordinated Indenture between Nevada Power and IBJ Schroder Bank & Trust Company, as Debenture
Trustee.
*4.02 Certificate of Trust of NVP Capital I.
</TABLE>
- ------------------------
* To be filed by amendment.
II-1
<PAGE>
<TABLE>
<C> <S>
*4.03 Trust Agreement of NVP Capital I.
*4.04 Certificate of Trust of NVP Capital II.
*4.05 Trust Agreement of NVP Capital II.
4.10 Form of Amended and Restated Trust Agreement (Agreements for NVP Capital I and NVP Capital II, are
substantially identical except for names and dates).
4.11 Form of Preferred Security Certificate for NVP Capital I and NVP Capital II (included as Exhibit E of
Exhibit 4.10 hereto).
4.12 Form of Guarantee Agreement (Agreements in respect of NVP Capital I and NVP Capital II, are substantially
identical except for names and dates).
4.13 Form of Supplemental Indenture between Nevada Power and IBJ Schroder Bank & Trust Company, as Debenture
Trustee (Supplemental Indentures for NVP Capital I and NVP Capital II are substantially identical except
for names and dates).
4.14 Form of Agreement as to Expenses and Liabilities between Nevada Power and NVP Capital I (Agreement in
respect of NVP Capital II is substantially identical except for names and dates)
5.01 Opinion of Best Best & Krieger LLP, relating to the legality of the Junior Subordinated Debentures and
the Guarantees.
5.02 Opinion of Richards, Layton & Finger, special Delaware counsel, relating to the legality of the Preferred
Securities of NVP Capital I and NVP Capital II.
8.01 Opinion of Jones, Day, Reavis & Pogue, as to certain United States federal income tax matters.
12.01 Statement regarding Computation of Ratio of Earnings to Fixed Charges.
23.01 Consent of Deloitte & Touche LLP (included in Part II of this Registration Statement).
23.02 Consent of Best Best & Krieger LLP (included in Part II of this Registration Statement).
23.03 Consent of Richard L. Hinckley, Esq. (included in Part II of this Registration Statement).
23.04 Consent of Richards, Layton & Finger, special Delaware counsel (included in Exhibit 5.02 hereto).
23.05 Consent of Jones, Day, Reavis & Pogue (included in Exhibit 8.01 hereto).
*25.01 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of IBJ Schroder Bank &
Trust Company, as Trustee for the Junior Subordinated Indenture.
*25.02 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of IBJ Schroder Bank &
Trust Company, as Property Trustee for the Amended and Restated Trust Agreement of NVP Capital I.
*25.03 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of IBJ Schroder Bank &
Trust Company, as Guarantee Trustee for the Guarantee for NVP Capital I.
*25.04 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of IBJ Schroder Bank &
Trust Company, as Property Trustee for the Amended and Restated Trust Agreement of NVP Capital II.
*25.05 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of IBJ Schroder Bank &
Trust Company, as Guarantee Trustee for the Guarantee for NVP Capital II.
</TABLE>
- ------------------------
* To be filed by amendment.
II-2
<PAGE>
In addition to those Exhibits shown above, Nevada Power hereby incorporates
the following Exhibits pursuant to Exchange Act Rule 12b-32 and Regulation
#201.24 by reference to the filings set forth below:
<TABLE>
<CAPTION>
EXHIBIT ORIGINALLY FILED
NO. DESCRIPTION AS EXHIBIT FILE NO.
- ----------- ------------------------------------------------------------------- --------------------- -----------
<C> <S> <C> <C>
4.1 Certificate of Designation of Cumulative Preferred Stock as
follows:
5.40% Series..................................................... 2.1 to Form S-1 2-16968
5.20% Series..................................................... 2.1 to Form S-1 2-20618
4.70% Series..................................................... 3.2 to Form 8-K 1-4698
July 1965
8% Series........................................................ 2.1 to Form S-7 2-44513
8.70% Series..................................................... 2.1 to Form S-7 2-49622
11.50% Series.................................................... 2.1 to Form S-7 2-52238
9.75% Series..................................................... 2.1 to Form S-7 2-56788
Auction Series A................................................. 4.6 to Form S-3 33-15554
Auction Series A as amended November 14, 1991.................... 4.9 to Form S-3 33-44460
Auction Series A as amended December 12, 1991.................... 4.1 to Form 10-K 1-4698
Year 1992
9.90% Series..................................................... 4.1 to Form 10-K 1-4698
Year 1992
4.2 Indenture of Mortgage and Deed of Trust Providing for First
Mortgage Bonds, dated October 1, 1953 and Twenty-Six Supplemental
Indentures as follows: 4.2 to Form S-1 2-10932
First Supplemental Indenture, dated August 1, 1954............... 4.2 to Form S-1 2-11440
Second Supplemental Indenture, dated September 1, 1956........... 4.9 to Form S-1 2-12566
Third Supplemental Indenture, dated May 1, 1959.................. 4.13 to Form S-1 2-14949
Fourth Supplemental Indenture, dated October 1, 1960............. 4.5 to Form S-1 2-16968
Fifth Supplemental Indenture, dated December 1, 1961............. 4.6 to Form S-16 2-74929
Sixth Supplemental Indenture, dated October 1, 1963.............. 4.6A to Form S-1 2-21689
Seventh Supplemental Indenture, dated August 1, 1964............. 4.6B to Form S-1 2-22560
Eighth Supplemental Indenture, dated April 1, 1968............... 4.6C to Form S-9 2-28348
Ninth Supplemental Indenture, dated October 1, 1969.............. 4.6D to Form S-1 2-34588
Tenth Supplemental Indenture, dated October 1, 1970.............. 4.6E to Form S-7 2-38314
Eleventh Supplemental Indenture, dated November 1, 1972.......... 2.12 to Form S-7 2-45728
Twelfth Supplemental Indenture, dated December 1, 1974........... 2.13 to Form S-7 2-52350
Thirteenth Supplemental Indenture, dated October 1, 1976......... 4.14 to Form S-16 2-74929
Fourteenth Supplemental Indenture, dated May 1, 1977............. 4.15 to Form S-16 2-74929
Fifteenth Supplemental Indenture, dated September 1, 1978........ 4.16 to Form S-16 2-74929
Sixteenth Supplemental Indenture, dated December 1, 1981......... 4.17 to Form S-16 2-74929
Seventeenth Supplemental Indenture, dated August 1, 1982......... 4.2 to Form 10-K 1-4698
Year 1982
Eighteenth Supplemental Indenture, dated November 1, 1986........ 4.6 to Form S-3 33-9537
</TABLE>
II-3
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT ORIGINALLY FILED
NO. DESCRIPTION AS EXHIBIT FILE NO.
- ----------- ------------------------------------------------------------------- --------------------- -----------
<C> <S> <C> <C>
Nineteenth Supplemental Indenture, dated October 1, 1989......... 4.2 to Form 10-K 1-4698
Year 1989
Twentieth Supplemental Indenture, dated May 1, 1992.............. 4.21 to Form S-3 33-53034
Twenty-First Supplemental Indenture, dated June 1, 1992.......... 4.22 to Form S-3 33-53034
Twenty-Second Supplemental Indenture, dated June 1, 1992......... 4.23 to Form S-3 33-53034
Twenty-Third Supplemental Indenture, dated October 1, 1992....... 4.23 to Form S-3 33-53034
Twenty-Fourth Supplemental Indenture, dated October 1, 1992...... 4.23 to Form S-3 33-53034
Twenty-Fifth Supplemental Indenture, dated January 1, 1993....... 4.23 to Form S-3 33-53034
Twenty-Sixth Supplemental Indenture dated May 1, 1995............ 4.2 to Form 10-K 1-4698
Year 1995
4.3 Instrument of Further Assurance dated April 1, 1956 to Indenture of
Mortgage and Deed of Trust dated October 1, 1953.................. 4.8 to Form S-1 2-12566
4.4 Rights Agreement dated October 15, 1990 between Manufacturers
Hanover Trust Company and Nevada Power Company.................... 4.1 to Form 8-A 1-4698
Year 1990
</TABLE>
ITEM 17. UNDERTAKINGS
The undersigned Registrants hereby undertake:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement;
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
Registration Statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in
the effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement; provided,
however, that paragraphs (1)(i) and (1)(ii) do not apply if the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the Commission by
the Registrant pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 (the "Exchange Act") that are incorporated by reference in the
Registration Statement.
II-4
<PAGE>
(2) That, for purposes of determining any liability under the Securities Act
of 1933, 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 Securities 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 Securities
Act, each such post-effective amendment 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) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(5) That, for purposes of determining any liability under the Securities
Act, each filing of the Registrant's annual report pursuant to Section 13(a) or
15(d) of the Exchange Act (and, where applicable, each filing of an employee
benefit plan's annual report pursuant to Section 15(d) of the Exchange Act) that
is incorporated by reference in the Registration Statement 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.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, 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 persons 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.
For the purposes of determining any liability under the Securities Act of
1933, 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.
The undersigned registrant hereby undertakes to file an application for the
purpose of determining the eligibility of the trustee to act under subsection
(a) of Section 310 of the Trust Indenture Act in accordance with the rules and
regulations prescribed by the Commission under Section 305(b)(2) of the Act.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
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 registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Las Vegas and State of Nevada on the 3rd day of
February, 1997.
NEVADA POWER COMPANY
By: /s/ CHARLES A. LENZIE
-----------------------------------------
(Charles A. Lenzie, Chairman of the
Board and Chief Executive Officer)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature appears
below constitutes and appoints Charles A. Lenzie and Steven W. Rigazio, and each
of them, his true and lawful attorneys in fact and agents with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same with all
documents in connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys in fact and agents, and each of them, full power
and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that said attorneys in fact and agents, or any of them, or their or his
substitutes may lawfully do or cause to be done by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATE INDICATED:
<TABLE>
<C> <S> <C>
(1) PRINCIPAL EXECUTIVE OFFICER
/s/ CHARLES A. LENZIE
- ---------------------------------------- Chairman of the Board and February 3, 1997
Charles A. Lenzie Chief Executive Officer
(2) PRINCIPAL FINANCIAL AND
PRINCIPAL ACCOUNTING OFFICER
/s/ STEVEN W. RIGAZIO
- ---------------------------------------- Vice President and Treasurer, February 3, 1997
Steven W. Rigazio Chief Financial Officer
(3) DIRECTORS
/s/ MARY LEE COLEMAN
- ---------------------------------------- Director January 28, 1997
Mary Lee Coleman
</TABLE>
II-6
<PAGE>
<TABLE>
<C> <S> <C>
/s/ FRED D. GIBSON, JR.
- ---------------------------------------- Director February 3, 1997
Fred D. Gibson, Jr.
/s/ JOHN L. GOOLSBY
- ---------------------------------------- Director February 3, 1997
John L. Goolsby
/s/ JERRY HERBST
- ---------------------------------------- Director February 3, 1997
Jerry Herbst
/s/ CONRAD L. RYAN
- ---------------------------------------- Director February 3, 1997
Conrad L. Ryan
/s/ FRANK E. SCOTT
- ---------------------------------------- Director February 3, 1997
Frank E. Scott
/s/ A. M. SMITH
- ---------------------------------------- Director January 28, 1997
A. M. Smith
/s/ J.A. TIBERTI
- ---------------------------------------- Director February 3, 1997
J.A. Tiberti
/s/ JOHN F. O'REILLY
- ---------------------------------------- Director January 28, 1997
John F. O'Reilly
</TABLE>
II-7
<PAGE>
INDEPENDENT AUDITORS' CONSENT
Nevada Power Company
We consent to the incorporation by reference in this Registration Statement of
Nevada Power Company on Form S-3 of our reports dated February 14, 1996
appearing in and incorporated by reference in the Annual Report on Form 10-K of
Nevada Power Company for the year ended December 31, 1995 and to the reference
to us under the heading "Experts" in the Prospectus, which is part of this
Registration Statement.
DELOITTE & TOUCHE LLP
Las Vegas, Nevada
February 3, 1997
II-8
<PAGE>
CONSENT OF COUNSEL
I hereby consent to the use of my name as Vice President, Secretary and
Chief Counsel of Nevada Power wherever it appears in the Registration Statement,
including the Prospectus constituting a part thereof, and all amendments
thereof.
RICHARD L. HINCKLEY, Esq.
Las Vegas, Nevada
February 3, 1997
------------------------
CONSENT OF COUNSEL
We hereby consent to all references to our Firm included in or made a part
of this Registration Statement, including the Prospectus constituting a part
thereof, and all amendments thereof.
BEST BEST & KRIEGER LLP
Riverside, California
February 3, 1997
II-9
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, NVP Capital I
and NVP Capital II certify that they have reasonable grounds to believe that
they meet all of the requirements for filing on Form S-3 and have duly caused
this registration statement to be signed on their behalf by the undersigned,
thereunto duly authorized, in the City of Las Vegas, State of Nevada, on
February 3, 1997.
NVP CAPITAL I
(Registrant)
By: Nevada Power Company, as Depositor
By: /s/ CHARLES A. LENZIE
--------------------------------------
Charles A. Lenzie, Chairman of the
Board
and Chief Executive Officer
NVP CAPITAL II
(Registrant)
By: Nevada Power Company, as Depositor
By: /s/ CHARLES A. LENZIE
--------------------------------------
Charles A. Lenzie, Chairman of the
Board
and Chief Executive Officer
II-10
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT NUMBERING
NO. PAGE NO.
- --------- ---------------
<C> <S> <C>
1.01 Proposed form of Underwriting Agreement Basic Provisions for Preferred Securities...........
4.01 Junior Subordinated Indenture between Nevada Power and IBJ Schroder Bank & Trust Company, as
Debenture Trustee..........................................................................
*4.02 Certificate of Trust of NVP Capital I.......................................................
*4.03 Trust Agreement of NVP Capital I............................................................
*4.04 Certificate of Trust of NVP Capital II......................................................
*4.05 Trust Agreement of NVP Capital II...........................................................
4.10 Form of Amended and Restated Trust Agreement (Agreements for NVP Capital I and NVP Capital
II are substantially identical except for names and dates).................................
4.11 Form of Preferred Security Certificate for NVP Capital I and NVP Capital II (included as
Exhibit E of Exhibit 4.10 hereto)..........................................................
4.12 Form of Guarantee Agreement (Agreements in respect of NVP Capital I and NVP Capital II are
substantially identical except for names and dates)........................................
4.13 Form of Supplemental Indenture between Nevada Power and IBJ Schroder Bank & Trust Company,
as Debenture Trustee (Supplemental Indentures for NVP Capital I and NVP Capital II are
substantially identical except for names and dates)
4.14 Form of Agreement as to Expenses and Liabilities between Nevada Power and NVP Capital I
(Agreement in respect of NVP Capital II is substantially identical except for names and
dates)
5.01 Opinion of Best Best & Krieger LLP (included in Part II of this Registration Statement),
relating to the legality of the Junior Subordinated Debentures and the Guarantees..........
5.02 Opinion of Richards, Layton & Finger, special Delaware counsel, relating to the legality of
the Preferred Securities NVP Capital I and NVP Capital II..................................
8.01 Opinion of Jones, Day, Reavis & Pogue as to certain United States federal income tax
matters....................................................................................
12.01 Statement regarding Computation of Ratio of Earnings to Fixed Charges.......................
23.01 Consent of Deloitte & Touche LLP (included in Part II of this Registration Statement).......
23.02 Consent of Best Best & Krieger LLP (included in Part II of this Registration Statement).....
23.03 Consent of Richard L. Hinckley, Esq. (included in Part II of this Registration Statement)...
</TABLE>
- ------------------------
* To be filed by amendment.
II-11
<PAGE>
<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT NUMBERING
NO. PAGE NO.
- --------- ---------------
<C> <S> <C>
23.04 Consent of Richards, Layton & Finger, special Delaware counsel (included in Exhibit 5.02
hereto)....................................................................................
23.05 Consent of Jones, Day, Reavis & Pogue (included in Exhibit 8.01 hereto).....................
*25.01 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of IBJ
Schroder Bank & Trust Company, as Trustee for the Junior Subordinated Indenture............
*25.02 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of IBJ
Schroder Bank & Trust Company, as Property Trustee for the Amended and Restated Trust
Agreement of NVP Capital I.................................................................
*25.03 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of IBJ
Schroder Bank & Trust Company, as Guarantee Trustee for the Guarantee for NVP Capital I....
*25.04 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of IBJ
Schroder Bank & Trust Company, as Property Trustee for the Amended and Restated Trust
Agreement of NVP Capital II................................................................
*25.05 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of IBJ
Schroder Bank & Trust Company, as Guarantee Trustee for the Guarantee for NVP Capital II...
</TABLE>
- ------------------------
* To be filed by amendment.
In addition to those Exhibits shown above, Nevada Power hereby incorporates
the following Exhibits pursuant to Exchange Act Rule 12b-32 and Regulation
#201.24 by reference to the filings set forth below:
<TABLE>
<CAPTION>
EXHIBIT ORIGINALLY FILED
NO. DESCRIPTION AS EXHIBIT FILE NO.
- ----------- ------------------------------------------------------------------- --------------------- -----------
<C> <S> <C> <C>
4.1 Certificate of Designation of Cumulative Preferred Stock as
follows:
5.40% Series..................................................... 2.1 to Form S-1 2-16968
5.20% Series..................................................... 2.1 to Form S-1 2-20618
4.70% Series..................................................... 3.2 to Form 8-K 1-4698
July 1965
8% Series........................................................ 2.1 to Form S-7 2-44513
8.70% Series..................................................... 2.1 to Form S-7 2-49622
11.50% Series.................................................... 2.1 to Form S-7 2-52238
9.75% Series..................................................... 2.1 to Form S-7 2-56788
Auction Series A................................................. 4.6 to Form S-3 33-15554
Auction Series A as amended November 14, 1991.................... 4.9 to Form S-3 33-44460
Auction Series A as amended December 12, 1991.................... 4.1 to Form 10-K 1-4698
Year 1992
9.90% Series..................................................... 4.1 to Form 10-K 1-4698
Year 1992
4.2 Indenture of Mortgage and Deed of Trust Providing for First
Mortgage Bonds, dated October 1, 1953 and Twenty-Six Supplemental
Indentures as follows: 4.2 to Form S-1 2-10932
First Supplemental Indenture, dated August 1, 1954............... 4.2 to Form S-1 2-11440
</TABLE>
II-12
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT ORIGINALLY FILED
NO. DESCRIPTION AS EXHIBIT FILE NO.
- ----------- ------------------------------------------------------------------- --------------------- -----------
<C> <S> <C> <C>
Second Supplemental Indenture, dated September 1, 1956........... 4.9 to Form S-1 2-12566
Third Supplemental Indenture, dated May 1, 1959.................. 4.13 to Form S-1 2-14949
Fourth Supplemental Indenture, dated October 1, 1960............. 4.5 to Form S-1 2-16968
Fifth Supplemental Indenture, dated December 1, 1961............. 4.6 to Form S-16 2-74929
Sixth Supplemental Indenture, dated October 1, 1963.............. 4.6A to Form S-1 2-21689
Seventh Supplemental Indenture, dated August 1, 1964............. 4.6B to Form S-1 2-22560
Eighth Supplemental Indenture, dated April 1, 1968............... 4.6C to Form S-9 2-28348
Ninth Supplemental Indenture, dated October 1, 1969.............. 4.6D to Form S-1 2-34588
Tenth Supplemental Indenture, dated October 1, 1970.............. 4.6E to Form S-7 2-38314
Eleventh Supplemental Indenture, dated November 1, 1972.......... 2.12 to Form S-7 2-45728
Twelfth Supplemental Indenture, dated December 1, 1974........... 2.13 to Form S-7 2-52350
Thirteenth Supplemental Indenture, dated October 1, 1976......... 4.14 to Form S-16 2-74929
Fourteenth Supplemental Indenture, dated May 1, 1977............. 4.15 to Form S-16 2-74929
Fifteenth Supplemental Indenture, dated September 1, 1978........ 4.16 to Form S-16 2-74929
Sixteenth Supplemental Indenture, dated December 1, 1981......... 4.17 to Form S-16 2-74929
Seventeenth Supplemental Indenture, dated August 1, 1982......... 4.2 to Form 10-K 1-4698
Year 1982
Eighteenth Supplemental Indenture, dated November 1, 1986........ 4.6 to Form S-3 33-9537
Nineteenth Supplemental Indenture, dated October 1, 1989......... 4.2 to Form 10-K 1-4698
Year 1989
Twentieth Supplemental Indenture, dated May 1, 1992.............. 4.21 to Form S-3 33-53034
Twenty-First Supplemental Indenture, dated June 1, 1992.......... 4.22 to Form S-3 33-53034
Twenty-Second Supplemental Indenture, dated June 1, 1992......... 4.23 to Form S-3 33-53034
Twenty-Third Supplemental Indenture, dated October 1, 1992....... 4.23 to Form S-3 33-53034
Twenty-Fourth Supplemental Indenture, dated October 1, 1992...... 4.23 to Form S-3 33-53034
Twenty-Fifth Supplemental Indenture, dated January 1, 1993....... 4.23 to Form S-3 33-53034
Twenty-Sixth Supplemental Indenture dated May 1, 1995............ 4.2 to Form 10-K 1-4698
Year 1995
4.3 Instrument of Further Assurance dated April 1, 1956 to Indenture of
Mortgage and Deed of Trust dated October 1, 1953.................. 4.8 to Form S-1 2-12566
4.4 Rights Agreement dated October 15, 1990 between Manufacturers
Hanover Trust Company and Nevada Power Company.................... 4.1 to Form 8-A 1-4698
Year 1990
</TABLE>
II-13
<PAGE>
JDR&P Draft of January 29, 1997
February __, 1997
NVP CAPITAL I
NVP CAPITAL II
CUMULATIVE QUARTERLY INCOME PREFERRED SECURITIES
(LIQUIDATION AMOUNT $25 PER PREFERRED SECURITY)
GUARANTEED TO THE EXTENT SET FORTH IN THE GUARANTEE BY
NEVADA POWER COMPANY
UNDERWRITING AGREEMENT BASIC PROVISIONS
From time to time NVP Capital I or NVP Capital II, each a statutory
business trust formed under the laws of the State of Delaware (each a "Trust"
and collectively, the "Trusts"), and Nevada Power Company, a Nevada corporation,
as depositor of each trust and as guarantor (the "Guarantor"), propose to issue
and sell certain of the Trusts' preferred securities (the "Securities")
representing undivided beneficial interests in the assets of such Trusts,
guaranteed by the Guarantor to the extent set forth in the guarantee agreement
(the "Guarantee Agreement") identified in the Terms Agreement (as defined
below).
The Trusts and the Guarantor propose to enter into one or more Terms
Agreements (each a "Terms Agreement") in the form of Annex I hereto, with such
additions and deletions as the parties thereto may determine, and, subject to
the terms and conditions stated herein and therein, which shall provide that the
Trust identified in the applicable Terms Agreement (such Trust being the
"Designated Trust" with respect to such Terms Agreement) shall issue and sell
the Securities to the firms named in Schedule I to the applicable Terms
Agreement (such firms constituting the "Underwriters" with respect to such Terms
Agreement and the Securities specified therein).
The Securities specified in such Terms Agreement are referred to as the
"Firm Designated Securities" with respect to such Terms Agreement. If so
specified in such Terms Agreement, the Designated Trust may grant the
Underwriters the right to purchase at their election an additional number of
Securities, specified as provided in such Terms Agreement as provided in
Section 2(b) hereof (the "Optional Designated Securities"). The Firm Designated
Securities and any Optional Designated Securities are collectively called the
"Designated Securities". The proceeds of the sale of the Designated Securities
and of common securities of the Trust (the "Common Securities") sold to the
Guarantor are to be invested in junior subordinated deferrable interest
debentures of the Guarantor (the "Subordinated Debentures"), to be issued
pursuant to a junior subordinated indenture to be dated as of February __, 1997
(the "Indenture") between the Guarantor and ________________ Trust Company, as
trustee. The Designated Securities may be exchangeable into Subordinated
Debentures, as specified in Schedule II to such Terms Agreement. Pursuant to
the Guarantee Agreement identified in the
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Terms Agreement relating to any particular issuance of Designated Securities,
the Designated Securities will be guaranteed by the Guarantor to the extent set
forth in such Terms Agreement (the "Guarantee").
The terms and rights of any particular issuance of Designated Securities
shall be as specified in the Terms Agreement relating thereto and in or pursuant
to the amended and restated trust agreement (the "Trust Agreement") identified
in such Terms Agreement.
Particular sales of Designated Securities may be made from time to time to
the Underwriters of such Designated Securities, for whom the firms designated as
representatives of the Underwriters of such Securities in the Terms Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" may also refer to a single firm acting as sole representative
of the Underwriters and to Underwriters who act without any firm being
designated as their representative. These Underwriting Agreement Basic
Provisions (this "Agreement") shall not be construed as an obligation of any
Trust to issue or sell any of the Securities or as an obligation of any of the
Underwriters to purchase any of the Securities. The obligation of any Trust to
issue and sell any of the Securities and the obligation of any of the
Underwriters to purchase any of the Securities shall be evidenced by the Terms
Agreement with respect to the Designated Securities specified therein. Each
Terms Agreement shall specify the aggregate number of the Firm Designated
Securities, the maximum number of Optional Designated Securities, if any, the
initial public offering price of such Firm and Optional Designated Securities or
the manner of determining such price, the terms of the Designated Securities,
including the terms on which, and terms of the securities into which, the
Designated Securities will be exchangeable, the purchase price to the
Underwriters of such Designated Securities, the names of the Underwriters of
such Designated Securities, the names of the Representatives of such
Underwriters, the number of such Designated Securities to be purchased by each
of the Underwriters and the commission, if any, payable to the Underwriters with
respect thereto and shall set forth the date, time and manner of delivery of
such Firm Designated Securities and Optional Designated Securities, if any, and
payment therefor. The Terms Agreement shall also specify (to the extent not set
forth in the registration statement and prospectus with respect thereto) the
terms of such Designated Securities. A Terms Agreement shall be in the form of
an executed writing (which may be in counterparts), and may be evidenced by an
exchange of telegraphic communications or any other rapid transmission device
designed to produce a written record of communications transmitted. The
obligations of the Underwriters under each Terms Agreement shall be several and
not joint.
Section 1. REPRESENTATIONS AND WARRANTIES.
Each of the Trusts and the Guarantor, jointly and severally, represents and
warrants to, and agrees with, each of the several Underwriters that:
(a) The Trusts and the Guarantor meet the requirements for use of Form S-3
and a registration statement (Registration No. 333-____) on Form S-3 relating to
the Securities, the Subordinated Debentures and the Guarantees, including a
preliminary prospectus and such amendments to such registration statement as may
have been required to the date of this Agreement, has been prepared by the
Trusts and the Guarantor under the provisions of the
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Securities Act of 1933, as amended (the "Act"), and the rules and regulations
(collectively referred to as the "1933 Act Regulations") of the Securities and
Exchange Commission (the "Commission") thereunder, and has been filed with the
Commission. No stop order suspending the effectiveness of such Registration
Statement has been issued and no proceeding for the purpose has been initiated
or threatened by the Commission. The term "preliminary prospectus" as used
herein means a preliminary prospectus as contemplated by Rule 430 or Rule 430A
("Rule 430A") of the 1933 Act Regulations included at any time as part of the
registration statement. Copies of such registration statement and amendments
and of each related preliminary prospectus have been delivered to the
Underwriters. If such registration statement has not become effective, a
further amendment to such registration statement, including a form of final
prospectus, necessary to permit such registration statement to become effective
will be filed promptly by the Guarantor with the Commission. If such
registration statement has become effective, a final prospectus containing
information permitted to be omitted at the time of effectiveness by Rule 430A
will be filed by the Guarantor with the Commission in accordance with
Rule 424(b) of the 1933 Act Regulations promptly after execution and delivery of
the Terms Agreement. The term "Registration Statement" means the registration
statement as amended at the time it becomes or became effective (the "Effective
Date"), including financial statements and all exhibits and any information
deemed to be included by Rule 430A and/or Rule 434. The term "Prospectus" means
the prospectus relating to the Securities, the Subordinated Debentures and the
Guarantees in the form in which it has most recently been filed with the
Commission on or before the date of the Agreement as first filed with the
Commission pursuant to Rule 424(b) of the 1933 Act Regulations. Any reference
herein to the Registration Statement, 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 which were filed under the
Securities Exchange Act of 1934, as amended (the "1934 Act"), on or before the
Effective Date or the date of such preliminary prospectus or the Prospectus, as
the case may be. If the Guarantor and the Trusts elect to rely on Rule 434 of
the 1933 Act, all references to "Prospectus" shall be deemed to include, without
limitation, the form of prospectus and the term sheet, taken together, provided
to the Underwriters by the Guarantor and the Trusts in accordance with Rule 434
of the 1933 Act. Any registration statement (including any amendment or
supplement thereto or information which is deemed part thereof) filed by the
Guarantor and the Trusts under Rule 462(b) shall be deemed to be part of the
"Registration Statement" as defined herein, and any prospectus (including any
amendment or supplement thereto or information which is deemed part thereof)
included in such registration statement shall be deemed to be part of the
"Prospectus", as defined herein, as appropriate.
Any reference herein to the terms "amend", "amendment" or "supplement"
with respect to the Registration Statement, any preliminary prospectus or the
Prospectus shall be deemed to refer to and include the filing of any document
under the 1934 Act after the Effective Date, or the date of any preliminary
prospectus or the Prospectus, as the case may be, and deemed to be incorporated
therein by reference.
(b) On the Effective Date, the date the Prospectus is first filed with the
Commission pursuant to Rule 424(b) (if required), at all times subsequent to and
including each Time of Delivery and when any post-effective amendment to the
Registration Statement becomes effective or any amendment or supplement to the
Prospectus is filed with the Commission, the
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Registration Statement and the Prospectus (as amended or as supplemented if the
Guarantor shall have filed with the Commission any amendment or supplement
thereto), including the financial statements included or incorporated by
reference in the Prospectus, did or will comply with all applicable provisions
of the 1933 Act, the 1933 Act Regulations, the 1934 Act, the rules and
regulations thereunder (the "1934 Act Regulations"), the Trust Indenture Act of
1939, as amended (the "1939 Act") and the rules and regulations thereunder (the
"1939 Act Regulations") and will contain all statements required to be stated
therein in accordance with the 1933 Act, the 1933 Act Regulations, the 1934 Act,
the 1934 Act Regulations, the 1939 Act and the 1939 Act Regulations. On the
Effective Date and when any post-effective amendment to the Registration
Statement becomes effective, no part of the Registration Statement or any such
amendment did or will contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein not misleading. At the Effective Date, the date the
Prospectus or any amendment or supplement to the Prospectus is filed with the
Commission and at each Time of Delivery, the Prospectus did not or will not
contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The foregoing representations and
warranties in this Section 1(b) do not apply to any statements or omissions made
in reliance on and in conformity with information relating to any Underwriter
furnished in writing to the Guarantor by the Underwriters specifically for
inclusion in the Registration Statement or Prospectus or any amendment or
supplement thereto. For all purposes of this Agreement, the amounts of the
selling concession and reallowance set forth in the Prospectus constitute the
only information relating to any Underwriter furnished in writing to the
Guarantor by the Underwriters specifically for inclusion in the Registration
Statement, the preliminary prospectus or the Prospectus. The Guarantor has not
distributed any offering material in connection with the offering or sale of the
Securities other than the Registration Statement, the preliminary prospectus,
the Prospectus or any other materials, if any, permitted by the 1933 Act.
(c) The documents which are incorporated by reference in the preliminary
prospectus and the Prospectus or from which information is so incorporated by
reference, when they become effective or were filed with the Commission, as the
case may be, complied in all material respects with the requirements of the 1933
Act or the 1934 Act, as applicable, the 1933 Act Regulations and the 1934 Act
Regulations; and any documents so filed and incorporated by reference subsequent
to the Effective Date shall, when they are filed with the Commission, conform in
all material respects with the requirements of the 1933 Act and the 1934 Act, as
applicable, the 1933 Act Regulations and the 1934 Act Regulations.
(d) The only subsidiaries (as defined in the 1933 Act Regulations) of the
Guarantor are the subsidiaries listed on Schedule A hereto (the "subsidiaries").
The Guarantor and each of its subsidiaries is, and at each Time of Delivery will
be, a corporation duly organized, validly existing and in good standing under
the laws of its jurisdiction of incorporation. The Guarantor and each of its
subsidiaries has, and at each Time of Delivery will have, full power and
authority to conduct all the activities conducted by it, to own or lease all the
assets owned or leased by it and to conduct its business as described in the
Registration Statement and the Prospectus. Each Trust is, and at each Time of
Delivery will be, a business trust duly organized, validly existing and in good
standing under the laws of the State of Delaware. Each
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Trust has, and at each Time of Delivery will have, full power and authority to
conduct all the activities conducted by it, to own or lease all the assets owned
or leased by it and to conduct its business as described in the Registration
Statement and the Prospectus. The Guarantor and each of its subsidiaries is,
and each Time of Delivery will be, duly licensed or qualified to do business and
in good standing as a foreign corporation in all jurisdictions in which the
nature of the activities conducted by it or the character of the assets owned or
leased by it makes such licensing or qualification necessary. Except for the
stock of the subsidiaries, the Common Securities of each Trust and as disclosed
in the Registration Statement and on Schedule B hereto, the Guarantor does not
own, and at each Time of Delivery will not own, directly or indirectly, any
shares of stock or any other equity or long-term debt securities of any
corporation or have any equity interest in any firm, partnership, joint venture,
trust, association or other entity. Complete and correct copies of the articles
of incorporation and of the by-laws of the Guarantor and each of its
subsidiaries and all amendments thereto have been delivered to the Underwriters,
and no changes therein will be made subsequent to the date hereof and prior to
each Time of Delivery.
(e) The outstanding beneficial interests in each Designated Trust have
been duly authorized, validly issued, fully paid and nonassessable. The
description of such beneficial interest in the Registration Statement and the
Prospectus is, and at each Time of Delivery will be, complete and accurate in
all respects. All of the issued and outstanding capital stock of each
subsidiary has been duly authorized and validly issued and is fully paid and
non-assessable, and all of such capital stock owned by the Guarantor, directly
or through subsidiaries, is owned free and clear of any mortgage, pledge, lien,
encumbrance, claim or equity.
(f) The financial statements included or incorporated by reference in the
Registration Statement or the Prospectus present fairly the consolidated
financial condition of the Guarantor as of the respective dates thereof and the
consolidated results of operations and cash flows of the Guarantor for the
respective periods covered thereby, all in conformity with generally accepted
accounting principles applied on a consistent basis throughout the entire period
involved, except as otherwise disclosed in the 1933 Prospectus. No other
financial statements or schedules of the Guarantor are required by the 1933 Act,
the 1934 Act, the 1933 Act Regulations or the 1934 Act Regulations to be
included in the Registration Statement or the Prospectus. Deloitte & Touche LLP
(the "Accountants"), who have reported on such financial statements and
schedules, are independent accountants with respect to the Guarantor as required
by the 1933 Act and the 1933 Act Regulations. The statements included in the
Registration Statement with respect to the Accountants pursuant to Item 509 of
Regulation S-K of the 1933 Act Regulations are true and correct in all material
respects.
(g) The Guarantor maintains a system of internal accounting control
sufficient to provide reasonable assurance that (i) transactions are executed in
accordance with management's general or specific authorization;
(ii) transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
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(h) Subsequent to the respective dates as of which information is given in
the Registration Statement and the Prospectus and prior to each Time of
Delivery, except as set forth in or contemplated by the Registration Statement
and the Prospectus, (i) there has not been and will not have been any change in
the capitalization of the Guarantor, each Trust or any of the Guarantor's
subsidiaries, or in the business, properties, business prospects, condition
(financial or otherwise) or results of operations of the Guarantor and its
subsidiaries, arising for any reason whatsoever, (ii) neither the Guarantor nor
any of its subsidiaries has incurred nor will it incur any material liabilities
or obligations, direct or contingent, nor has it entered into nor will it enter
into any material transactions other than pursuant to this Agreement and the
transactions referred to herein and (iii) the Guarantor has not and will not
have paid or declared any dividends or other distributions of any kind on any
class of its capital stock.
(i) Neither any Trust or the Guarantor is, nor after giving effect to the
offering and sale of the Securities, will be, an "investment company" or an
"affiliated person" of, or "promoter" or "principal underwriter" for, an
"investment company", as such terms are defined in the Investment Company Act of
1940, as amended (the "1940 Act").
(j) Except as set forth in the Registration Statement and the Prospectus,
there are no actions, suits or proceedings pending or threatened against or
affecting the Guarantor or any of its subsidiaries or any of their respective
officers in their capacity as such, before or by any Federal or state court,
commission, regulatory body, administrative agency or other governmental body,
domestic or foreign, wherein an unfavorable ruling, decision or finding might
materially and adversely affect the Guarantor or any of its subsidiaries or its
business, properties, business prospects, condition (financial or otherwise) or
results of operations or materially and adversely affect the Guarantor's ability
to consummate the transactions contemplated by the applicable Terms Agreement to
which this Agreement is attached and of which it forms a part or the Guarantor
Agreements (as defined below).
(k) The Guarantor and each of its subsidiaries has, and at each Time of
Delivery will have, (i) all governmental licenses, permits, consents, orders,
approvals and other authorizations necessary to carry on its business as
contemplated in the Prospectus, (ii) complied in all respects with all laws,
regulations and orders applicable to it or its business and (iii) performed all
its obligations required to be performed by it, and is not, and at each Time of
Delivery will not be, in default, under any indenture, mortgage, deed of trust,
voting trust agreement, loan agreement, bond, debenture, note agreement, lease,
contract or other agreement or instrument that is material to the Guarantor
(collectively, a "material contract or other material agreement") to which it is
a party or by which its property is bound or affected. To the best knowledge of
the Guarantor and each of its subsidiaries, no other party under any material
contract or other material agreement to which it is a party is in default in any
respect thereunder. Neither the Guarantor nor any of its subsidiaries is, nor at
each Time of Delivery will any of them be, in violation of any provision of its
articles of incorporation or by-laws.
(l) No consent, approval, authorization or order of, or any filing or
declaration with, any court or governmental agency or body is required in
connection with (i) the issuance and sale of the Securities and the Common
Securities by any applicable Trust, (ii) the purchase of the Subordinated
Debentures by such Trust, (iii) the issuance of the Guarantees or the
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Subordinated Debentures by the Guarantor, or (iv) the consummation by any
applicable Trust or the Guarantor of the transactions contemplated by (A) any
Terms Agreement to which this Agreement is attached and of which it forms a
part, (B) any Overallotment Option (as defined in Section 2(b) hereof), or (C)
any Guarantor Agreement (other than an approving Order of the Public Service
Commission of Nevada, which has been obtained and is in full force and effect),
except such as have been obtained under the 1933 Act or the 1933 Act Regulations
and such as may be required under the by-laws and rules of the National
Association of Securities Dealers, Inc. (the "NASD") in connection with the
purchase and distribution by the Underwriters of the Securities.
(m) Each of the Guarantor and the Designated Trust has full corporate
power and authority to enter into this Agreement and any applicable Terms
Agreement to which this is attached. This Agreement has been and any applicable
Terms Agreement to which this is attached, when executed and delivered, will be,
duly authorized, executed and delivered by the Guarantor and the Designated
Trust and constitutes a valid and binding agreement of the Guarantor and the
Designated Trust and is enforceable against the Guarantor and the Designated
Trust in accordance with the terms hereof. The performance of this Agreement
and the consummation of the transactions contemplated hereby will not result in
the creation or imposition of any lien, charge or encumbrance upon any of the
assets of the Guarantor or any of its subsidiaries pursuant to the terms or
provisions of, or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, or give any other party a right to
terminate any of its obligations under, or result in the acceleration of any
obligation under, the articles of incorporation or by-laws of the Guarantor or
any of its subsidiaries, any contract or other agreement to which the Guarantor
or any of its subsidiaries is a party or by which the Guarantor or any of its
subsidiaries or any of its properties is bound or affected, or violate or
conflict with any judgment, ruling, decree, order, statute, rule or regulation
of any court or other governmental agency or body applicable to the business or
properties of the Guarantor or any of its subsidiaries.
(n) The Securities have been duly and validly authorized, and (i) when the
Firm Designated Securities are issued and delivered pursuant to the Terms
Agreement with respect to such Designated Securities to which this Agreement is
attached and of which it forms a part and, (ii) in the case of any Optional
Designated Securities, when such Optional Designated Securities are issued and
delivered pursuant to Overallotment Options with respect to such Securities,
such Designated Securities will be duly and validly issued and fully paid and
non-assessable beneficial interests in the Designated Trust, entitled to the
benefits provided by the applicable Trust Agreement, which Trust Agreement will
be substantially in the form filed as an exhibit to the Registration Statement;
and the Securities conform in all material respects to the description thereof
contained in the Registration Statement; and the Designated Securities conform
in all material respects to the description thereof contained in the Prospectus
as amended or supplemented with respect to such Designated Securities.
(o) 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.
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(p) The Common Securities of each Trust have been duly authorized on
behalf of each such Trust by the depositor thereof and upon delivery by each
such Trust to the Guarantor against payment therefor as set forth in the Trust
Agreement, will be duly and validly issued and non-assessable beneficial
interests in such Trust and will conform in all material respects to the
description thereof contained in the Prospectus; the issuance of the Common
Securities is not subject to preemptive or other similar rights; the Common
Securities conform in all material respects to the description thereof contained
in the Registration Statement; and at each Time of Delivery, all of the issued
and outstanding Common Securities of each Designated Trust will be directly
owned by the Guarantor, or a person into which the Guarantor has merged or with
which the Guarantor has been consolidated pursuant to Section [8.01] of the
Indenture, free and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity.
(q) The Subordinated Debentures have been duly authorized and, when issued
and delivered pursuant to the Indenture, will have been duly executed,
authenticated, issued and delivered and will constitute valid and legally
binding obligations of the Guarantor entitled to the benefits of the Indenture,
which will be substantially in the form filed as an exhibit to the Registration
Statement; the Guarantees have been duly authorized and, when issued and
delivered pursuant to each Guarantee Agreement, will have been duly issued and
delivered and will constitute valid and legally binding obligations of the
Guarantor entitled to the benefits of the applicable Guarantee Agreement, which
will be substantially in the form filed as an exhibit to the Registration
Statement; the Indenture, the Trust Agreements and the Guarantee Agreements
(collectively, the "Guarantor Agreements") have been duly authorized and duly
qualified under the 1939 Act and, when executed and delivered by the Guarantor
and, (i) in the case of each Guarantee Agreement, by the Guarantee Trustee (as
defined in the Guarantee Agreement), (ii) in the case of each Trust Agreement,
by the Trustees (as defined in the Trust Agreement) and, (iii) in the case of
the Indenture, by the trustee named therein (the "Debenture Trustee"), will
constitute valid and legally binding instruments, enforceable in accordance with
their respective terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or affecting
creditors' rights and to general equity principles; and the Guarantees, the
Subordinated Debentures and the Guarantor Agreements will conform in all
material respects to the descriptions thereof in the Prospectus.
(r) Neither (i) the issuance and sale of the Securities by the applicable
Trust, (ii) the compliance by such Trust with all of the provisions of any Terms
Agreement to which this Agreement is attached and of which it forms a part, each
Overallotment Option, if any, the Designated Securities and each Trust
Agreement, (iii) the execution, delivery and performance by the applicable Trust
of the Trust Agreement, nor (iv) the consummation of the transactions
contemplated herein or therein will conflict with or constitute a breach of, or
default under, or result in the creation, imposition or violation of any lien,
charge or encumbrance upon any property or assets of such Trust pursuant to, (A)
the Trust Agreement of such Trust, (B) any law, administrative regulation or
administrative or court order or decree applicable to such Trust, (C) any
contract, indenture, mortgage, loan agreement, note, lease or other instrument
to which such Trust is a party or by which such Trust is bound or to which any
of the property or assets of such Trust is subject, where, in each such case,
such conflict, breach or default, or lien, charge or encumbrance would have a
material adverse effect on the condition, financial or otherwise, or the
earnings or business affairs of such Trust.
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(s) Neither (i) the issuance by the Guarantor of the Guarantees and the
Subordinated Debentures, (ii) the compliance by the Guarantor with all of the
provisions of any Terms Agreement to which this Agreement is attached and forms
a part and each Overallotment Option, if any, the Guarantees, the Subordinated
Debentures and the Guarantor Agreements, (iii) the execution, delivery and
performance by the Guarantor of the Guarantor Agreements, nor (iv) the
consummation of the transactions contemplated herein or therein will conflict
with or constitute a breach of, or default under, or result in the creation,
imposition or violation of any lien, charge or encumbrance upon any property or
assets of the Guarantor or any of its subsidiaries pursuant to, (A) the charter
or by-laws of the Guarantor, (B) any law, administrative regulation or
administrative or court order or decree applicable to the Guarantor, (C) any
contract, indenture, mortgage, loan agreement, note, lease or other instrument
to which the Guarantor or any such subsidiary is a party or by which it or any
of them is bound or to which any of the property or assets of the Guarantor or
any such subsidiary is subject, where, in each such case, such conflict, breach
or default, or lien, charge or encumbrance would have a material adverse effect
on the condition, financial or otherwise, or the earnings or business affairs of
the Guarantor and its subsidiaries considered as one enterprise.
(t) The Guarantor and each of its subsidiaries has good and marketable
title to all properties and assets described in the Prospectus as owned by it,
free and clear of all liens, charges, encumbrances or restrictions, except such
as are described in the Prospectus or are not material to the business of the
Guarantor or its subsidiaries. The Guarantor and each of its subsidiaries has
valid, subsisting and enforceable leases for the properties described in the
Prospectus as leased by it, with such exceptions as are not material and do not
materially interfere with the use made and proposed to be made of such
properties by the Guarantor and such subsidiaries.
(u) There is no document or contract of a character required to be
described in the Registration Statement or the Prospectus or to be filed as an
exhibit to the Registration Statement which is not described or filed as
required. All such contracts to which the Guarantor or any subsidiary is a
party have been duly authorized, executed and delivered by the Guarantor or such
subsidiary, constitute valid and binding agreements of the Guarantor or such
subsidiary and are enforceable against the Guarantor or such subsidiary in
accordance with the terms thereof.
(v) No statement, representation, warranty or covenant made by the
Guarantor or any Trust in this Agreement or made in any certificate or document
required by this Agreement to be delivered to the Underwriters was or will be,
when made, inaccurate, untrue or incorrect.
(w) Neither the Guarantor nor any of its directors, officers or
controlling persons has taken directly or indirectly any action intended, or
which might reasonably be expected, to cause or result, under the 1933 Act or
otherwise, in, or which has constituted, stabilization or manipulation of the
price of any security of the Guarantor to facilitate the sale or resale of the
Securities.
(x) No holder of securities of the Guarantor has rights to the
registration of any securities of the Guarantor because of the filing of the
Registration Statement.
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(y) Neither the Guarantor nor any of its subsidiaries is involved in any
material labor dispute nor, to the knowledge of the Guarantor, is any such
dispute threatened.
(z) The Guarantor and its subsidiaries own, or are licensed or otherwise
have the full exclusive right to use, all material trademarks and trade names
which are used in or necessary for the conduct of their respective businesses as
described in the Prospectus. No claims have been asserted by any person to the
use of any such trademarks or trade names or challenging or questioning the
validity or effectiveness of any such trademark or trade name. The use, in
connection with the business and operations of the Guarantor and its
subsidiaries, of such trademarks and trade names does not, to the Guarantor's
knowledge, infringe on the rights of any person.
(aa) Neither the Guarantor nor any of its subsidiaries nor, to the
Guarantor's knowledge, any employee or agent of the Guarantor or any subsidiary
has made any payment of funds of the Guarantor or any subsidiary or received or
retained any funds in violation of any law, rule or regulation or of a character
required to be disclosed in the Prospectus.
(bb) The information regarding the Guarantor included in the _____________
_____ and _____________ _____, 1997 letters to the Corporate Financing
Department of the NASD is true and correct.
Section 2. PURCHASE AND SALE.
(a) Upon the execution of the Terms Agreement applicable to any Designated
Securities and authorization by the Representatives of the release of the Firm
Designated Securities, the several Underwriters propose to offer the Firm
Designated Securities for sale upon the terms and conditions set forth in the
Prospectus as amended or supplemented in relation to the applicable Designated
Securities.
(b) The Designated Trust may specify in the Terms Agreement applicable to
any Designated Securities that the Designated Trust thereby grants to the
several Underwriters the right (an "Overallotment Option") to purchase at their
election up to the number of Optional Designated Securities set forth in such
Terms Agreement, on the terms set forth in the paragraph next above, for the
sole purpose of covering over-allotments in the sale of the Firm Designated
Securities. Any such election to purchase Optional Designated Securities may be
exercised by written notice from the Representatives to the Designated Trust and
the Guarantor, given within a period specified in the Terms Agreement, setting
forth the aggregate number of Optional Designated Securities to be purchased and
the date on which such Optional Designated Securities are to be delivered, as
determined by the Representatives, but in no event earlier than the First Time
of Delivery (as defined in Section 2(c) hereof) or, unless the Representatives,
the Designated Trust and the Guarantor otherwise agree in writing, earlier than
or later than the respective number of business days after the date of such
notice set forth in such Terms Agreement.
The number of Optional Designated Securities to be added to the number of
Firm Designated Securities to be purchased by each Underwriter as set forth in
Schedule I to the
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Terms Agreement applicable to such Designated Securities shall be, in each case,
the number of Optional Designated Securities which the Designated Trust and the
Guarantor have been advised by the Representatives have been attributed to such
Underwriter; provided that, if the Designated Trust and the Guarantor have not
been so advised, the number of Optional Designated Securities to be so added
shall be, in each case, that proportion of Optional Designated Securities which
the number of Firm Designated Securities to be purchased by such Underwriter
under such Terms Agreement bears to the aggregate number of Firm Designated
Securities (rounded as the Representatives may determine to the nearest 100
securities). The total number of Designated Securities to be purchased by all
the Underwriters pursuant to such Terms Agreement shall be the aggregate number
of Firm Designated Securities set forth in Schedule I to such Terms Agreement
plus the aggregate number of Optional Designated Securities which the
Underwriters elect to purchase.
(c) Certificates for the Firm Designated Securities and the Optional
Designated Securities to be purchased by each Underwriter pursuant to the Terms
Agreement relating thereto, in the form specified in such Terms Agreement, and
in such authorized denominations and registered in such names as the
Representatives may request upon at least forty-eight hours' prior notice to the
Designated Trust and the Guarantor, shall be delivered by or on behalf of the
Designated Trust to the Representatives for the account of such Underwriter,
against payment by such Underwriter or on its behalf of the purchase price
therefor by wire transfer of New York Clearing House (next day) funds to an
account designated by the Designated Trust, payable to the order of the
Designated Trust in the funds specified in such Terms Agreement, (i) with
respect to the Firm Designated Securities, all in the manner and at the place
and time and date specified in such Terms Agreement or at such other place and
time and date as the Representatives, the Designated Trust and the Guarantor may
agree upon in writing, such time and date being herein called the "First Time of
Delivery" and (ii) with respect to the Optional Designated Securities, if any,
in the manner and at the time and date specified by the Representatives in the
written notice given by the Representatives of the Underwriters' election to
purchase such Optional Designated Securities, or at such other time and date as
the Representatives, the Designated Trust and the Guarantor may agree upon in
writing, such time and date, if not the First Time of Delivery, herein called
the "Second Time of Delivery". Each such time and date for delivery is herein
called a "Time of Delivery".
Section 3. COVENANTS OF THE DESIGNATED TRUST AND THE GUARANTOR.
Each of the Designated Trust and the Guarantor, jointly and severally,
agrees with each of the several Underwriters of any Designated Securities:
(a) To prepare the Prospectus as amended and supplemented in relation to
the applicable Designated Securities in a form approved by the Representatives
and to file such Prospectus pursuant to Rule 424(b); to not, either prior to the
Effective Date or thereafter during such period as the Prospectus is required by
law to be delivered in connection with sales of the Securities by an Underwriter
or dealer, file any amendment or supplement to the Registration Statement or the
Prospectus, unless a copy thereof shall first have been submitted to the
Underwriters within a reasonable period of time prior to the filing thereof and
the Underwriters shall not have objected thereto in good faith.
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(b) To use its best efforts to cause the Registration Statement to become
effective, and to notify the Underwriters promptly, and to confirm such advice
in writing, (i) when the Registration Statement has become effective and when
any post-effective amendment thereto becomes effective, (ii) of any request by
the Commission for amendments or supplements to the Registration Statement or
the Prospectus or for additional information, (iii) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the initiation of any proceedings for that purpose or the threat
thereof, (iv) of the happening of any event during the period mentioned in the
second sentence of section 3(e) that in the judgment of the Guarantor makes any
statement made in the Registration Statement or the Prospectus untrue or that
requires the making of any changes in the Registration Statement or the
Prospectus in order to make the statements therein, in the light of the
circumstances in which they are made, not misleading and (v) of receipt by the
Guarantor or any representative or attorney of the Guarantor of any other
communication from the Commission relating to the Guarantor, the Registration
Statement, any preliminary prospectus or the Prospectus; if at any time the
Commission shall issue any order suspending the effectiveness of the
Registration Statement, to make every reasonable effort to obtain the withdrawal
of such order at the earliest possible moment; if the Guarantor has omitted any
information from the Registration Statement pursuant to Rule 430A, to use its
best efforts to comply with the provisions of and make all requisite filings
with the Commission pursuant to said Rule 430A and to notify the Underwriters
promptly of all such filings.
(c) To furnish to the Underwriters, without charge, three signed copies of
the Registration Statement and of any post-effective amendment thereto,
including financial statements and schedules, and all exhibits thereto
(including any document filed under the 1934 Act and deemed to be incorporated
by reference into the Prospectus), and to furnish to the Underwriters without
charge a copy of the Registration Statement and any post-effective amendment
thereto, including financial statements and schedules but without exhibits.
(d) To comply with all the provisions of any undertakings contained in the
Registration Statement.
(e) On the Effective Date, and thereafter from time to time, to deliver to
each of the Underwriters, without charge, as many copies of the Prospectus or
any amendment or supplement thereto as the Underwriters may reasonably request;
if during such period of time any event shall occur which in the judgment of the
Guarantor or counsel to the Underwriters should be set forth in the Prospectus
in order to make any statement therein, in the light of the circumstances under
which it was made, not misleading, or if it is necessary to supplement or amend
the Prospectus to comply with law, to forthwith prepare and duly file with the
Commission an appropriate supplement or amendment thereto, and to deliver to
each of the Underwriters, without charge, such number of copies thereof as the
Underwriters may reasonably request; to not file any document under the 1934 Act
before the termination of the offering of the Securities by the Underwriters if
such document would be deemed to be incorporated by reference into the
Prospectus which is not approved by the Underwriters after reasonable notice
thereof. Each of the Designated Trust and the Guarantor consents to the use of
the Prospectus or any amendment or supplement thereto by the several
Underwriters and by all dealers to whom the Securities may be sold, both in
connection with the offering or sale of
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the Securities and for any period of time thereafter during which the Prospectus
is required by law to be delivered in connection therewith.
(f) Prior to any public offering of the Securities by the Underwriters, to
cooperate with the Underwriters and counsel to the Underwriters in connection
with the registration or qualification of the Securities or the Subordinated
Debentures issuable upon the exchange of the Securities for offer and sale under
the securities or Blue Sky laws of such jurisdictions as the Underwriters may
request; provided, that in no event shall the Guarantor be obligated to qualify
to do business in any jurisdiction where it is not now so qualified or to take
any action which would subject it to general service of process in any
jurisdiction where it is not now so subject.
(g) During the period of five years commencing on the Effective Date, to
furnish to the Underwriters copies of such financial statements and other
periodic and special reports as the Guarantor may from time to time distribute
generally to the holders of any class of its capital stock, and to furnish to
the Underwriters a copy of each annual or other report it is required to file
with the Commission.
(h) In the case of the Guarantor, to make generally available to holders
of its securities, as soon as may be practicable but in no event later than the
last day of the fifteenth full calendar month following the calendar quarter in
which the Effective Date falls, an earnings statement (which need not be audited
but shall be in reasonable detail) for a period of 12 months ended commencing
after the Effective Date, and satisfying the provisions of Section 11(a) of
(including Rule 158 of the 1933 Act Regulations).
(i) If this Agreement shall be terminated by the Guarantor or any Trust
pursuant to any of the provisions hereof (otherwise than pursuant to Section 8)
or if for any reason the Guarantor or any Trust shall be unable to perform its
obligations hereunder, to reimburse the several Underwriters for all
out-of-pocket expenses (including the fees, disbursements and other charges of
counsel to the Underwriters) reasonably incurred by them in connection herewith.
(j) To not at any time, directly or indirectly, take any action intended,
or which might reasonably be expected, to cause or result in, or which will
constitute, stabilization of the price of the Securities to facilitate the sale
or resale of any of the Securities.
(k) In the case of each Trust, to apply the net proceeds from the offering
and sale of the Securities to be sold by such Trust and, in the case of the
Guarantor, to apply the net proceeds from the offering and sale of the
Subordinated Debentures to be sold by the Guarantor, in the manner set forth in
the Prospectus under "Use of Proceeds".
(l) In the case of the Guarantor, to file promptly all reports and any
definitive proxy or information statements required to be filed by the Guarantor
with the Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the 1934
Act for so long as the delivery of a prospectus is required in connection with
the offering or sale of such Securities.
(m) During the period beginning from the date of the Terms Agreement for
such Designated Securities and continuing to and including the later of (i) the
termination of trading
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restrictions for such Designated Securities, as notified to the Designated Trust
and the Guarantor by the Representatives and (ii) 30 days after the last Time of
Delivery for such Designated Securities, not to offer, sell, contract to sell or
otherwise dispose of, except as provided hereunder, any Securities, any other
beneficial interests in the assets of the Designated Trust, or any preferred
securities or any other securities of the Designated Trust or the Guarantor, as
the case may be, that are substantially similar to such Designated Securities
(including any guarantee of such securities) or any securities that are
convertible into or exchangeable for, or that represent the right to receive
Securities, other beneficial interests of the Designated Trust, preferred
securities or any such substantially similar securities of either the Designated
Trust or the Guarantor (including any guarantee of such securities) without the
prior written consent of the Representatives.
(n) In the case of the Guarantor, to issue the Guarantee concurrently with
the issuance and sale of the Securities as contemplated herein or in the Terms
Agreement.
(o) To list for quotation the Securities on the New York Stock Exchange.
Section 4. PAYMENT OF EXPENSES.
The Guarantor covenants and agrees with the several Underwriters that it
will pay or cause to be paid the following: (i) the fees, disbursements and
expenses of the Guarantor's counsel and accountants in connection with the
registration of the Securities, the Guarantees and the Subordinated Debentures
under the 1933 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, any
Terms Agreement, any Guarantor Agreement, the Securities and the Subordinated
Debentures [and any Blue Sky Memorandum]; [(iii) all reasonable expenses in
connection with the qualification of the Securities, the Guarantees and the
Subordinated Debentures for offering and sale under state securities laws as
provided in Section 3(f) hereof, including the reasonable fees and disbursements
of counsel for the Underwriters in connection with such qualification and in
connection with the Blue Sky survey(s);] (iv) any fees charged by securities
rating services for rating the Securities and the Subordinated Debentures; (v)
any filing fees incident to, and the reasonable fees and disbursements of
counsel for the Underwriters in connection with, any required reviews by the
NASD of the terms of the sale of the Securities and the issuance of the
Guarantees and the Subordinated Debentures; (vi) the cost of preparing the
Securities and the Subordinated Debentures; (vii) the reasonable fees and
expenses of any Trustee, Debenture Trustee and Guarantee Trustee, and any agent
of any trustee and the reasonable fees and disbursements of counsel for any
trustee in connection with any Trust Agreement, Indenture, Guarantee and the
Securities; (viii) the cost of qualifying the Securities with The Depository
Trust Company; (ix) any 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 1934 Act; and (x) all other costs and
expenses incident to the performance of its obligations hereunder and under any
Overallotment Options which are not otherwise specifically provided for in this
Section. It is understood, however, that, except as provided in this Section,
and Sections 6 and 8 hereof, the
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Underwriters will pay all of their own costs and expenses, including the fees of
their counsel, transfer taxes on resale of any of the Securities by them, and
any advertising expenses connected with any offers they may make.
Section 5. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS.
The obligations of the Underwriters of any Designated Securities under the
Terms Agreement relating to such Designated Securities shall be subject, in the
discretion of the Representatives, to the condition that all representations and
warranties and other statements of the Designated Trust and the Guarantor in or
incorporated by reference in the Terms Agreement relating to such Designated
Securities are, at and as of each Time of Delivery for such Designated
Securities, true and correct, the condition that the Designated Trust and the
Guarantor shall have performed all of their respective obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus as amended or supplemented in relation to such
Designated Securities shall have been filed with the Commission pursuant to
Rule 424(b) within the applicable time period prescribed for such filing by the
1933 Act and the 1933 Act Regulations and in accordance with Section 3(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 the Representatives' reasonable satisfaction.
(b) Jones, Day, Reavis & Pogue, counsel for the Underwriters, shall have
furnished to the Representatives such opinion or opinions, dated each Time of
Delivery for such Designated Securities, with respect to such matters as the
Representatives 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.
(c) Best, Best & Krieger LLP, as counsel for the Guarantor, shall have
furnished to the Representatives their written opinions, dated each Time of
Delivery for such Designated Securities, respectively, in form and substance
reasonably satisfactory to the Representatives, to the effect that:
(i) The Guarantor and each of its subsidiaries is a corporation
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation, is duly licensed or qualified to do
business and is in good standing as a foreign corporation in all
jurisdictions in which the nature of the activities conducted by it or the
character of the assets owned or leased by it makes such license or
qualification necessary, has full power and authority to conduct all the
activities conducted by it, to own or lease all the assets owned or leased
by it and to conduct its business as described in the Registration
Statement and the Prospectus and has all governmental licenses, permits,
consents, orders, approvals and other authorizations necessary to carry on
its business as contemplated in the Prospectus. The Guarantor is the sole
record and beneficial owner of all of the capital stock of each of its
subsidiaries.
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(ii) The Subordinated Debentures, in the form certified by the
Guarantor to be true and correct copies, are in the form prescribed in or
pursuant to the Indenture, have been duly authorized by the Guarantor and,
when authenticated, issued and delivered by the Guarantor as specified in
or pursuant to the Indenture, will be valid and binding obligations of the
Guarantor and, subject to applicable bankruptcy laws, are enforceable
against the Guarantor in accordance with the terms thereof.
(iii) No consent, approval, authorization or order of, or any
filing or declaration with, any court or governmental agency or body is
required in connection with the issuance and sale of the Designated
Securities being delivered at such Time of Delivery or the issuance of the
Guarantee and the Subordinated Debentures or the consummation by the
Designated Trust or the Guarantor of the transactions contemplated by the
Terms Agreement to which this Agreement is attached and forms a part and
the Guarantor Agreements, or in connection with the taking by the Guarantor
of any action contemplated thereby other than an approving order of the
Public Service Commission of Nevada, which has been obtained and is in full
force and effect, except such as have been obtained under the 1933 Act, the
1933 Regulations, the 1939 Act and the 1939 Act Regulations, and such as
may be required by the by-laws and rules of the NASD in connection with the
purchase and distribution by the Underwriters of the Securities to be sold
by the Guarantor.
(iv) The statements set forth in the Prospectus under the caption
"Description of QUIDS", "Description of QUIPS", "Description of
Guarantees", "Description of Corresponding QUIDS" and "Relationship Among
the QUIPS, the Corresponding QUIDS and the Guarantees" insofar as they
purport to summarize certain provisions of documents specifically referred
to therein, are accurate summaries of such provisions in all material
respects.
(v) The Registration Statement and the Prospectus (including any
documents incorporated by reference into the Prospectus at the time they
were filed) comply or complied in all material respects as to form with the
requirements of the 1933 Act, the 1934 Act, the 1933 Act Regulations, the
1934 Act Regulations, the 1939 Act and the 1939 Act Regulations (except
that we express no opinion as to financial statements, schedules and other
financial and statistical data contained in the Registration Statement or
the Prospectus or incorporated by reference therein).
(vi) We have participated in the preparation of the Registration
Statement and the Prospectus and nothing has come to our attention which
has caused us to believe that, as of the Effective Date, the date of the
Prospectus and such Time of Delivery, either the Registration Statement or
the Prospectus, or any amendment or supplement thereto including any
documents incorporated by reference into the Prospectus, contained or
contains any untrue statement of a material fact or omitted or omits to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading in the light of the circumstances in
which they were made (except that we express no opinion as to financial
statements, schedules and other
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financial or statistical data contained in the Registration Statement or
the Prospectus or incorporated by reference therein).
(vii) The Registration Statement has become effective under the
1933 Act and, to the best of our knowledge, no order suspending the
effectiveness of the Registration Statement has been issued and no
proceeding for that purpose has been instituted or is threatened, pending
or contemplated.
(viii) We have reviewed all contracts and other documents referred
to in the Registration Statement and the Prospectus and such contracts or
other documents are fairly summarized or disclosed therein, and filed as
exhibits thereto as required, and, after due inquiry, we do not know of any
contracts or other documents required to be so summarized or disclosed or
filed or required to be filed under the 1934 Act if upon such filing they
would be incorporated, in whole or in part, by reference therein which have
not been so summarized or disclosed or filed.
(ix) All descriptions in the Prospectus of statutes, regulations
or legal or governmental proceedings are accurate and fairly present the
information required to be shown.
(x) The Guarantor has full corporate power and authority to
enter into this Agreement, the Terms Agreement with respect to the
Designated Securities and each of the Guarantor Agreements, and each of
this Agreement, the Terms Agreement with respect to the Designated
Securities and each of the Guarantor Agreements is a valid and binding
agreement of the Guarantor and, except for the indemnification and
contribution provisions of this Agreement, as to which we express no
opinion, and subject to applicable bankruptcy laws, is enforceable against
the Guarantor in accordance with the terms thereof.
(xi) The Guarantor has full corporate power and authority to
execute the Guarantee, and the Guarantee has been duly authorized and, when
issued and delivered pursuant to the Terms Agreement to which this
Agreement is a part, will have been duly executed, issued and delivered by
the Guarantor and will be a valid and binding obligation of Guarantor and,
subject to applicable bankruptcy laws, will be enforceable against the
Guarantor in accordance with its terms.
(xii) Delivery of certificates for the Securities will pass valid
and marketable title thereto to each Underwriter that has purchased such
Securities in good faith and we are not aware, after due inquiry, of any
adverse claim with respect thereto, and such Securities are free and clear
of all liens, encumbrances and claims.
(xiii) To the best of our knowledge, neither the Guarantor nor any
of its subsidiaries is in violation of its articles of incorporation,
by-laws or other charter documents or in default (nor has an event occurred
which with notice or lapse of time or both would constitute a default or
acceleration) in the performance of any obligation, agreement or condition
contained in any indenture, mortgage, deed of trust, voting trust
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agreement, loan agreement, bond, debenture, note agreement or other
evidence of indebtedness, lease, contract or other agreement or instrument
known to us to which the Guarantor or any of its subsidiaries is a party or
by which it or its properties is bound or affected and neither the
Guarantor nor any of its subsidiaries is in violation of any judgment,
ruling, decree, order, franchise, license or permit known to us or any
statute, rule or regulation of any court or other governmental agency or
body applicable to the business or properties of the Guarantor or any of
its subsidiaries, where such violation or default might have a material
adverse effect on the business, properties, business prospects, condition
(financial or otherwise) or results of operations of the Guarantor or any
of its subsidiaries.
(xiv) The issuance by the Guarantor of the Guarantee and the
Subordinated Debentures, the compliance by the Guarantor with all of the
provisions of the Terms Agreement to which this Agreement is attached and
forms a part and the Guarantor Agreements, the execution, delivery and
performance by the Guarantor of the Terms Agreement to which this Agreement
is attached and forms a part and the Guarantor Agreements and the
consummation of the transactions herein and therein contemplated do not and
will not result in a breach or violation of any terms or provisions of the
articles of incorporation or by-laws of the Guarantor or any of its
subsidiaries.
(xv) Neither the Designated Trust nor the Guarantor is an
"investment company" or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company", as such terms are
defined in the 1940 Act.
(xvi) The Designated Securities have been duly authorized for
listing by the New York Stock Exchange upon official notice of issuance.
(xvii) The Indenture, each of the Trust Agreements and each of the
Guarantees is qualified under the 1939 Act.
(d) Richard L. Hinckley, Esq., Vice President, Secretary and Chief Counsel
of the Guarantor, shall have furnished to the Representatives his written
opinions, dated each Time of Delivery for such Designated Securities,
respectively, in form and substance reasonably satisfactory to the
Representatives, to the effect set forth in Section 5(c)(i)-(iv), (vi), (x),
(xi), (xiii) and (xiv) and to the effect that:
(i) All of the issued and outstanding capital stock of each
subsidiary has been duly authorized and validly issued and is fully paid
and non-assessable, and all of such capital stock owned by the Guarantor,
directly or through subsidiaries, is owned free and clear of any mortgage,
pledge, lien, encumbrance, claim or equity.
(ii) I know of no actions, suits or proceedings pending or
threatened against or affecting the Guarantor or any of its subsidiaries or
the business, properties, business prospects, condition (financial or
otherwise) or results of operations of the Guarantor or any of its
subsidiaries, or any of their respective officers in the capacities
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as such, before or by any federal or state court, commission, regulatory
body, administrative agency or other governmental body, wherein an
unfavorable ruling, decision or finding might materially and adversely
affect the Guarantor or any of its subsidiaries or its business,
properties, business prospects, condition (financial or otherwise) or
results of operations, except as set forth in or contemplated by the
Registration Statement and the Prospectus.
(iii) The issuance and sale of the Designated Securities being
delivered at such Time of Delivery and the compliance by the Designated
Trust with all of the provisions of the Terms Agreement to which this
Agreement is attached and forms a part, the Designated Securities and the
Trust Agreement with respect to the Designated Securities, the purchase by
the Designated Trust of the Subordinated Debentures, the execution and
delivery of this Agreement by the Designated Trust, the compliance by the
Designated Trust with the terms of this Agreement and the consummation of
the transactions contemplated herein and in the Trust Agreement do not and
will not result in the creation or imposition of any lien, charge or
encumbrance upon any of the assets of the Designated Trust pursuant to the
terms or provisions of, or result in a breach or violation of any of the
terms or provisions of, or constitute a default or result in the
acceleration of any obligation under, the Trust Agreement, any indenture,
mortgage, deed of trust, voting trust agreement, loan agreement, bond,
debenture, note agreement or other evidence of indebtedness, lease,
contract or other agreement or instrument known to me to which such
Designated Trust is a party or by which it or any of its properties is
bound or affected, or any judgment, ruling, decree, order, statute, rule or
regulation of any court or other governmental agency or body applicable to
the business or property of such Designated Trust.
(iv) The issuance by the Guarantor of the Guarantee and the
Subordinated Debentures, the compliance by the Guarantor with all of the
provisions of the Terms Agreement to which this Agreement is attached and
forms a part and the Guarantor Agreements, the execution, delivery and
performance by the Guarantor of the Guarantor Agreements and the
consummation of the transactions herein and therein contemplated do not and
will not result in the creation or imposition of any lien, charge or
encumbrance upon any of the assets of the Guarantor or any of its
subsidiaries pursuant to the terms or provisions of, or result in a breach
or violation of any of the terms or provisions of, or constitute a default
or result in the acceleration of any obligation under, the articles of
incorporation, or by-laws of the Guarantor or any of its subsidiaries, any
indenture, mortgage, deed of trust, voting trust agreement, loan agreement,
bond, debenture, note agreement or other evidence of indebtedness, lease,
contract or other agreement or instrument known to me to which the
Guarantor or any of its subsidiaries is a party or by which it or any of
its properties is bound or affected, or any judgment, ruling, decree,
order, statute, rule or regulation of any court or other governmental
agency or body applicable to the business or property of the Guarantor or
any of its subsidiaries.
(e) Richards, Layton & Finger, special Delaware Counsel to the Designated
Trust and the Guarantor, shall have furnished to you, the Guarantor and the
Designated Trust their written
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opinion, dated the respective Time of Delivery, in form and substance
satisfactory to you, to the effect that
(i) The Designated Trust 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 the Designated Trust as
a business trust have been made.
(ii) Under the Delaware Business Trust Act and the Trust
Agreement, the Designated Trust has the power and authority to own property
and conduct its business, all as described in the Prospectus.
(iii) The Trust Agreement constitutes a valid and legally binding
obligation of the Guarantor and the Trustees, enforceable against the
Guarantor and the Trustees, in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights, to the effect of applicable
policy on the enforceability of provisions relating to indemnification or
contribution, and to general equity principles (except that such counsel
need not express an opinion with respect to whether the right of the
Preferred Security Holders or the Common Security Holders to institute a
legal proceeding directly against any person to enforce any right of the
Property Trustee is consistent with or permitted by Section 3816 of the
Delaware Business Trust Act relating to derivative actions).
(iv) Under the Delaware Business Trust Act and the Trust
Agreement, the Designated Trust has the power and authority to execute and
deliver, and to perform its obligations under this Agreement and the Terms
Agreement and issue and perform its obligations under the Designated
Securities and the Common Securities.
(v) Under the Delaware Business Trust Act and the Trust
Agreement, the execution and delivery by the Designated Trust of this
Agreement and the Terms Agreement to which this Agreement is attached and
forms a part, and the performance by the Designated Trust of its
obligations thereunder, have been duly authorized by all necessary action
on the part of the Designated Trust.
(vi) This Agreement and the Terms Agreement to which this
Agreement is attached and forms a part with respect to the Designated
Securities have been duly executed and delivered by the Designated Trust.
(vii) The Designated Securities have been duly authorized by the
Trust Agreement and the depositor on behalf of the Designated Trust and are
duly and validly issued and, subject to the qualifications set forth
herein, fully paid and non-assessable beneficial interests in the assets of
the Designated Trust and are entitled to the benefits provided by the Trust
Agreement; the Securityholders, as beneficial owners of the Designated
Trust, will be entitled to the same limitation of personal liability
extended to stockholders of private corporations for profit organized under
the General Corporation
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Law of the State of Delaware; provided that such counsel may note that the
Securityholders may be obligated, pursuant to the Trust Agreement, to
provide indemnity and/or security in connection with and pay taxes or
governmental charges arising from transfers or exchanges of Securities
Certificates and the issuance of replacement Securities Certificates and
provide security and 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.
(viii) The Common Securities have been duly authorized by the Trust
Agreement and are validly issued and represent beneficial interests in the
assets of the Designated Trust.
(ix) Under the Delaware Business Trust Act and the Trust
Agreement, the issuance of the Designated Securities and the Common
Securities is not subject to preemptive rights.
(x) The issuance and sale by the Designated Trust of Designated
Securities and the Common Securities, the execution, delivery and
performance by the Designated Trust of this Agreement and the Terms
Agreement to which this Agreement is attached and forms a part, the
consummation by the Designated Trust of the transactions contemplated
thereby and compliance by the Designated Trust with its obligations
thereunder will not violate any of the provisions of the Certificate of
Trust of the Designated Trust or the Trust Agreement or any applicable
Delaware law or administrative regulation.
(xi) The issuance and sale of the Designated Securities being
delivered at such Time of Delivery and the compliance by the Designated
Trust with the Terms Agreement to which this Agreement is attached and
forms a part, the Designated Securities and the Trust Agreement with
respect to the Designated Securities, the purchase by the Designated Trust
of the Subordinated Debentures and the consummation of the transactions
contemplated herein and in the Trust Agreement will not result in any
violation of the provisions of the Certificate of Trust or Trust Agreement
of the Designated Trust.
(xii) Assuming that the Designated Trust derives no income from or
connected with sources within the State of Delaware and has no assets,
activities (other than maintaining the Delaware Trustee 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 agency is
required to be obtained by the Designated Trust solely in connection with
the issuance and sale of the Designated Securities and the Common
Securities (except that such counsel need express no opinion concerning the
securities laws of the State of Delaware).
(xiii) Assuming that the Designated Trust derives no income from or
connected with sources within the State of Delaware and has no assets,
activities (other
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<PAGE>
than maintaining the Delaware Trustee and the filing of documents with the
Secretary of State of the State of Delaware) or employees in the State of
Delaware, the Designated Trust will be treated as a grantor trust for
United States Federal income tax purposes and 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 the
Designated Trust, and the Designated Trust will not be liable for any
income tax imposed by the State of Delaware.
(f) Jones, Day, Reavis & Pogue, as tax counsel for the Designated Trust
and the Guarantor, shall have furnished to you their written opinion, dated the
respective Time of Delivery, in form and substance satisfactory to you, to the
effect that such firm confirms its opinion set forth in the Prospectus under the
caption "Certain Federal Income Tax Consequences".
(g) On the date of the Terms Agreement for such Designated Securities, at
a time prior to the execution of the Terms Agreement with respect to the
Designated Securities, and at each Time of Delivery for such Designated
Securities, the independent accountants of the Guarantor who have certified the
consolidated financial statements of the Guarantor and its subsidiaries included
or incorporated by reference in the Registration Statement shall have furnished
to the Representatives a letter, dated the effective date of the Registration
Statement or the date of the most recent report filed with the Commission
containing consolidated financial statements and incorporated by reference in
the Registration Statement, if the date of such report is later than such
effective date, and a letter dated such Time of Delivery, respectively, to the
effect set forth in Annex II hereto, and with respect to such letter dated such
Time of Delivery, as to such other matters as the Representatives may reasonably
request and in form and substance satisfactory to the Representatives.
(h) Since the date of the applicable Terms Agreement or since the
respective dates as of which information is given in the Registration Statement
and the Prospectus, there shall have been no change in the capital stock or
long-term debt of the Guarantor or any of its subsidiaries or any material
adverse change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Guarantor and its subsidiaries
considered as one enterprise, whether or not arising in the ordinary course of
business, the effect of which 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 Designated Securities on the terms
and in the manner contemplated in the Prospectus as amended relating to the
Designated Securities.
(i) On or after the date of the Terms Agreement relating to the Designated
Securities the rating assigned by any nationally recognized securities rating
agency to any debt securities or preferred stock of the Guarantor as of the date
of any applicable Terms Agreement shall not have been lowered since that date of
such Terms Agreement or no such rating agency shall have publicly announced that
it has placed any debt securities of the Guarantor on what is commonly termed a
"watch list" for possible downgrading.
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<PAGE>
(j) On or after the date of the Terms Agreement relating to the Designated
Securities there shall not have occurred any of the following: (i) any material
adverse change in the financial markets in the United States or any outbreak or
escalation of hostilities or other national or international calamity or crisis,
the effect of which shall be such as to make it, in the reasonable judgment of
the Representative, impracticable to market the Designated Securities or enforce
contracts for the sale of the Designated Securities, (ii) trading in any
securities of the Guarantor shall have been suspended by the Commission, the
Nasdaq National Market or a national securities exchange, (iii) trading
generally on either the New York Stock Exchange or the Nasdaq National Market
shall have been suspended, or minimum or maximum prices for trading shall have
been fixed, or maximum ranges for prices for securities shall have been
required, by either of said exchanges or by order of the Commission or any other
governmental authority, or (iv) a banking moratorium shall have been declared by
either Federal or New York authorities.
(k) The Designated Securities at each Time of Delivery shall have been
duly listed on the New York Stock Exchange.
(l) The Designated Trust and the Guarantor shall have furnished or caused
to be furnished to the Representatives at each Time of Delivery for the
Designated Securities certificates of officers of the Designated Trust and the
Guarantor satisfactory to the Representatives as to the accuracy of the
representations and warranties of the Designated Trust and the Guarantor herein
at and as of such Time of Delivery, as to the performance by the Designated
Trust and the Guarantor 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 (i) of this Section and as to such other matters as the Representatives
may reasonably request.
Section 6. INDEMNIFICATION AND CONTRIBUTION.
(a) The Designated Trust and the Guarantor, 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 1933 Act 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, the Prospectus as amended or
supplemented, 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 the Designated Trust nor the Guarantor 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, the Prospectus as amended or supplemented, or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Designated Trust or the Guarantor by any
Underwriter of Designated Securities through
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<PAGE>
the Representatives expressly for use in the Prospectus as amended or
supplemented relating to such Securities.
(b) Each Underwriter will indemnify and hold harmless the Designated Trust
and the Guarantor against any losses, claims, damages or liabilities to which
the Designated Trust or the Guarantor may become subject, under the 1933 Act 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, the Prospectus as amended or supplemented, 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, the Prospectus as amended or
supplemented, or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Designated Trust and the
Guarantor by such Underwriter through the Representatives expressly for use
therein and will reimburse the Designated Trust and the Guarantor for any legal
or other expenses reasonably incurred by the Designated Trust or the Guarantor
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 the indemnifying party in writing of the
commencement thereof; but the omission so to notify such indemnifying party
shall not relieve it from any liability which it may have to any indemnified
party under such subsection, unless such omission prejudices the indemnifying
party's ability to adequately defend such action or claim, or 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 reasonably
satisfactory to such indemnified party (who shall not, except with the consent
of the indemnified party, which consent shall not be unreasonably withheld, 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 subsection (a) or (b) above 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 any statement as to, or an
admission of, fault, culpability or a failure to act, by or on behalf of any
indemnified party. The indemnifying
24
<PAGE>
party shall not be required to indemnify the indemnified party for any amount
paid or payable by the indemnifying party in the settlement of any claim or
action effected without the written consent of the indemnifying party, which
consent shall not be unreasonably withheld.
(d) If the indemnification provided for in this Section 6 is unavailable
to or insufficient 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 the Designated Trust and the Guarantor on the one hand and the Underwriters
of the Designated Securities on the other from the offering of the Designated
Securities to which such loss, claim, damage or liability (or action in respect
thereof) relates. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the indemnified
party failed to give in a timely manner the notice required under subsection (c)
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Designated Trust and the Guarantor on the one hand and the Underwriters of the
Designated Securities 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. The relative benefits received by the Designated Trust and the
Guarantor on the one hand and such Underwriters on the other shall be deemed to
be in the same proportion as the total net proceeds from such offering (before
deducting expenses) received by the Designated Trust and the Guarantor bear to
the total underwriting compensation received by such Underwriters. The 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 the
Designated Trust and the Guarantor on the one hand or such Underwriters on the
other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Designated
Trust, the Guarantor 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 applicable Designated
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 1933 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The obligations of the Underwriters of Designated Securities
in this subsection
25
<PAGE>
(d) to contribute are several in proportion to their respective underwriting
obligations with respect to such Securities and not joint.
(e) The obligations of the Designated Trust and the Guarantor under this
Section 6 shall be in addition to any liability which the Designated Trust and
the Guarantor 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 1933 Act; and the obligations of the Underwriters under this
Section 6 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 the Designated Trust and the
Guarantor and to each person, if any, who controls the Designated Trust and the
Guarantor within the meaning of the 1933 Act.
Section 7. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY.
The respective indemnities, agreements, representations, warranties and
other statements of the Designated Trust or the Guarantor and the several
Underwriters, as set forth in any Terms Agreement to which this Agreement is
attached and forms a part or made by or on behalf of them, respectively,
pursuant to any Terms Agreement to which this Agreement is attached and forms a
part, 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 the Designated Trust or the
Guarantor, or any officer or director or controlling person of the Designated
Trust or the Guarantor, and shall survive delivery of and payment for the
Securities.
Section 8. TERMINATION OF AGREEMENT.
If any Terms Agreement or Overallotment Option shall be terminated pursuant
to Section 9 hereof, neither the Designated Trust nor the Guarantor shall then
be under any liability to any Underwriter with respect to the Firm Designated
Securities or Optional Designated Securities with respect to which such Terms
Agreement shall have been terminated except as provided in Sections 4 and 6
hereof; but, if for any other reason, Designated Securities are not delivered by
or on behalf of the Designated Trust or the Guarantor as provided herein, the
Guarantor will reimburse the Underwriters through the Representatives for all
out-of-pocket expenses approved in writing by the Representatives, including
fees and disbursements of counsel, reasonably incurred by the Underwriters in
making preparations for the purchase, sale and delivery of such Designated
Securities, but the Designated Trust or the Guarantor shall then be under no
further liability to any Underwriter with respect to such Designated Securities
except as provided in Sections 4 and 6 hereof.
Section 9. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS.
If one or more of the Underwriters participating in an offering of Firm
Designated Securities or Optional Designated Securities shall fail at the
applicable Time of Delivery to purchase such Securities which it or they are
obligated to purchase hereunder and under the applicable Terms Agreement (the
"Defaulted Securities"), then the Representatives shall have the right, within
the first 36 hours thereafter, to make arrangements for one or more of the
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<PAGE>
non-defaulting Underwriters, or any other underwriters, to purchase all, but not
less than all, of the Defaulted Securities in such amounts as may be agreed upon
and upon the terms herein set forth; if, within such first 36 hour period, the
Representatives are unable to make arrangements for the purchase of all of the
Defaulted Securities, then the Designated Trust and the Guarantor shall have the
right, within the next 36 hours thereafter, to make arrangements for any other
underwriter(s) reasonably satisfactory to the nondefaulting Underwriters to
purchase all, but not less than all, of the Defaulted Securities in such amounts
as may be agreed upon and upon the terms herein set forth; if, however, after
such 72 hours neither the Representatives nor the Designated Trust shall have
completed such arrangements for the purchase of all of the Defaulted Securities,
then:
(a) if the aggregate principal amount of Defaulted Securities does not
exceed 10% of the aggregate principal amount of Firm Designated Securities or
the Optional Designated Securities, as the case may be, to be purchased pursuant
to such Terms Agreement, the Designated Trust and the Guarantor shall have the
right to require the non-defaulting Underwriters named in such Terms Agreement
to purchase the full amount thereof in the proportions that their respective
underwriting obligations bear to the underwriting obligations of all
non-defaulting Underwriters, or
(b) if the aggregate principal amount of Defaulted Securities exceeds 10%
of the aggregate principal amount of Firm Designated Securities or the Optional
Designated Securities, as the case may be, to be purchased pursuant to such
Terms Agreement, or the Designated Trust and the Guarantor shall not exercise
their right pursuant to Section 9(a) above, the applicable Terms Agreement shall
terminate without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section 9 shall relieve any defaulting
Underwriter from liability in respect of its default under this Agreement and
the applicable Terms Agreement.
In the event of any such default by any Underwriter or Underwriters as set
forth in this Section 9, either the Representatives or the Designated Trust
shall have the right to postpone the applicable Time of Delivery for a period
not to exceed seven days in order to effect any required changes in the
Registration Statement or Prospectus or in any other documents or arrangements.
Section 10. NOTICES.
In all dealings hereunder, the Representatives of the Underwriters of
Designated Securities shall act on behalf of each of such 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 such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Terms Agreement.
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 the address of the Representatives as set forth in the
Terms Agreement; and if to the Designated Trust or the Guarantor shall be
delivered or sent by mail, telex or facsimile transmission to the address of the
Designated Trust or the Guarantor, respectively, set forth in the Registration
Statement,
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Attention: Secretary; provided, however, that any notice to an Underwriter
pursuant to Section 6(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 the Designated Trust and the Guarantor by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
Section 11. PARTIES.
This Agreement and each Terms Agreement shall be binding upon, and inure
solely to the benefit of, the Underwriters, each Designated Trust, the Guarantor
and, to the extent provided in Sections 6 hereof, the officers and directors of
each Designated Trust, the Guarantor and each person who controls any Designated
Trust or the Guarantor 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 or any such Terms
Agreement. No purchaser of any of the Securities from any Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
Section 12. TIME OF THE ESSENCE; BUSINESS DAY.
Time shall be of the essence of each Terms 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.
Section 13. GOVERNING LAW.
Each Terms Agreement to which this Agreement is attached and forms a part
shall be governed by and construed in accordance with the laws of the State of
New York.
Section 14. COUNTERPARTS.
Each Terms Agreement may be executed by any one or more of the parties
hereto and thereto in any number of counterparts, each of which shall be deemed
to be an original, but all such respective counterparts shall together
constitute one and the same instrument.
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ANNEX I
Terms Agreement
Goldman, Sachs & Co.,
[Name(s) of Co-Representative(s),]
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:
NVP Capital I, a statutory business trust formed under the laws of the
State of Delaware (the "Designated Trust"), and Nevada Power Company, a Nevada
corporation (the "Guarantor"), propose, subject to the terms and conditions
stated herein and in the Underwriting Agreement Basic Provisions (the
"Underwriting Agreement Basic Provisions") of the Designated Trust, NVP Capital
II and the Guarantor, to issue and sell to the Underwriters named in Schedule I
hereto (the "Underwriters") the Securities specified in Schedule II hereto (the
"Designated Securities" consisting of Firm Designated Securities and any
Optional Designated Securities the Underwriters may elect to purchase). The
Designated Securities are exchangeable into debt securities of the Guarantor
(the "Subordinated Debentures"), as specified in Schedule II to this Agreement.
The Designated Securities will be guaranteed by the Guarantor to the extent set
forth in this Agreement with respect to such Designated Securities (the
"Guarantee"). Each of the provisions of the Underwriting Agreement Basic
Provisions is incorporated herein by reference in its entirety, and shall be
deemed to be a part of this Agreement to the same extent as if such provisions
had been set forth in full herein; and each of the representations and
warranties set forth therein shall be deemed to have been made at and as of the
date of this Terms Agreement, except that each representation and warranty which
refers to the Prospectus in Section 1 of the Underwriting Agreement Basic
Provisions shall be deemed to be a representation or warranty as of the date of
the Underwriting Agreement Basic Provisions in relation to the Prospectus (as
therein defined), and also a representation and warranty as of the date of this
Terms Agreement in relation to the Prospectus as amended or supplemented
relating to the Designated Securities which are the subject of this Terms
Agreement. Each reference to the Representatives herein and in the provisions of
the Underwriting Agreement Basic Provisions so incorporated by reference shall
be deemed to refer to you. Unless otherwise defined herein, terms defined in the
Underwriting Agreement Basic Provisions are used herein as therein defined. The
Representatives designated to act on behalf of the Representatives and on behalf
of each of the Underwriters of the Designated Securities pursuant to Section 10
of the Underwriting Agreement Basic Provisions and the address of the
Representatives referred to in such Section 10 are set forth in Schedule II
hereto.
I-1
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An amendment to the Registration Statement or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement Basic Provisions incorporated herein by reference, (a)
the Designated Trust agrees to issue and sell to each of the Underwriters, and
each of the Underwriters agrees, severally and not jointly, to purchase from the
Designated Trust, at the time and place and at the purchase price to the
Underwriters set forth in Schedule II hereto, the number of Firm Designated
Securities set forth opposite the name of such Underwriter in Schedule I hereto
and, (b) in the event and to the extent that the Underwriters shall exercise the
election to purchase Optional Designated Securities, as provided below, the
Designated Trust agrees to issue and sell to each of the Underwriters, and each
of the Underwriters agrees, severally and not jointly, to purchase from the
Designated Trust at the purchase price to the Underwriters set forth in Schedule
II hereto that portion of the number of Optional Designated Securities as to
which such election shall have been exercised.
The Designated Trust hereby grants to each of the Underwriters the right to
purchase at their election up to the number of Optional Designated Securities
set forth opposite the name of such Underwriter in Schedule I hereto on the
terms referred to in the paragraph next above for the sole purpose of covering
over-allotments in the sale of the Firm Designated Securities. Any such election
to purchase Optional Designated Securities may be exercised by written notice
from the Representatives to the Designated Trust and the Guarantor given within
a period of 15 calendar days after the date of this Terms Agreement, setting
forth the aggregate number of Optional Designated Securities to be purchased and
the date on which such Optional Designated Securities are to be delivered, as
determined by the Representatives, but in no event earlier than the First Time
of Delivery or, unless the Representatives and the Designated Trust otherwise
agree in writing, no earlier than two or later than ten business days after the
date of such notice.
If the foregoing is in accordance with your understanding, please sign and
return to us ten counterparts hereof, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement Basic Provisions
incorporated herein by reference, shall constitute a binding agreement between
each of the Underwriters and the Designated Trust and the Guarantor. It is
understood that your acceptance of this letter on behalf of each of the
Underwriters is or will be pursuant to the authority set forth in a form of
Agreement among Underwriters, the form of which shall be submitted to the
Designated Trust and the Guarantor
I-2
<PAGE>
for examination, upon request, but without warranty on the part of the
Representatives as to the authority of the signers thereof.
Very truly yours,
NEVADA POWER COMPANY
By:
--------------------------
Name:
Title:
NVP CAPITAL I
By: Nevada Power Company, as Depositor
By:
--------------------------
Name:
Title:
Accepted as of the date hereof:
Goldman, Sachs & Co.
[Name(s) of Co-Representative(s)]
As Representatives of the Underwriters
Named in Schedule I hereto
By:
---------------------------------
(Goldman, Sachs & Co.)
On behalf of each of the Underwriters
named on Schedule I hereto
I-3
<PAGE>
SCHEDULE I
Number of Firm Maximum Number of
Designated Optional Designated
Securities to be Securities Which May
Underwriter Purchased Be Purchased
----------- --------- ------------
Goldman, Sachs & Co.............................................................
[Name(s) of Co-Representative(s)]...............................................
[Names of other Underwriters]...................................................
Total
-I-1-
<PAGE>
SCHEDULE II
Designated Trust:
NVP Capital __
Title of Designated Securities:
____% Cumulative Quarterly Income Preferred Securities, Series __ ("QUIPS")
Aggregate principal amount:
Aggregate principal amount of Designated Securities: $_____________
Price to Public:
100% of the principal amount of the Designated Securities
Purchase Price by Underwriters:
_______% of the principal amount of the Designated Securities
Underwriters' Compensation:
$______ per Designated Security
Specified funds for payment of purchase price:
Next-day funds
Accountants' Letter to be delivered on date of Terms Agreement:
Yes.
Trust Agreement:
Amended and Restated Trust Agreement dated as of ________ __, ____, between
the Guarantor and the Trustees named therein
Indenture:
Indenture dated as of February __, 1997, between the Guarantor and
___________________________ Trust Company, as Debenture Trustee and
Supplemental Indenture No. __ dated as of ________ __, ____, between the
Guarantor and the Debenture Trustee (collectively the "Indenture")
-II-1-
<PAGE>
Guarantee:
Guarantee Agreement dated as of ________ __, ____, between Guarantor and
_______________ Trust Company, as Guarantee Trustee
Maturity:
________ __, ____
Interest Rate:
____%
Interest Payment Dates:
March 31, June 30, September 30 and December 31
Extension Period:
20 quarters
Redemption Provisions:
The redemption provisions set forth in Section 402 of the Trust Agreement
shall apply to the Designated Securities.
Sinking Fund Provisions:
No sinking fund provisions
Time of Delivery:
10:00 a.m., New York City time ________ __, ____
Closing Location:
Jones, Day, Reavis & Pogue
77 West Wacker
Chicago, Illinois 60601-1692
Names and addresses of Representatives:
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
-II-2-
<PAGE>
ANNEX II
Pursuant to Section 5(i) of the Underwriting Agreement Basic Provisions,
the accountants shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with
respect to the Designated Trust and the Guarantor and its subsidiaries
within the meaning of the 1933 Act and the 1933 Act Regulations;
(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 1933 Act or the 1934 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 Guarantor 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 Guarantor's Quarterly Reports 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 Guarantor 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 all material respects with the applicable accounting
requirements of the 1933 Act and the 1934 Act and the 1934 Act 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 1933 Act and the 1934 Act and the 1934 Act Regulations;
(iv) The unaudited selected financial information with respect to
the consolidated results of operations and financial position of the
Guarantor for the five most recent fiscal years included in the Prospectus
and included or incorporated by reference in Item 6 of the Guarantor'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
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<PAGE>
included or incorporated by reference in the Guarantor's Annual Reports on
Form 10-K for such fiscal years;
(v) 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 Guarantor and its subsidiaries, inspection of
the minute books of the Guarantor 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 Guarantor 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 Guarantor'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 1934 Act and the 1934 Act
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 Guarantor'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 Guarantor'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 Guarantor'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
II-2
<PAGE>
comply as to form in all material respects with the applicable
accounting requirements of the 1933 Act and the 1933 Act
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 Guarantor 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
(vi) 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 Guarantor 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 Guarantor and its subsidiaries and have found them to be in
agreement.
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<PAGE>
All references in this Annex II to the Prospectus shall be deemed to refer
to the Prospectus (including the documents incorporated by reference therein) as
defined in the Underwriting Agreement Basic Provisions as of the date of the
letter delivered on the date of the Terms Agreement for purposes of such letter
and to the Prospectus as amended or supplemented (including the documents
incorporated by reference therein) in relation to the applicable Designated
Securities for purposes of the letter delivered at the Time of Delivery for such
Designated Securities.
II-4
<PAGE>
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NEVADA POWER COMPANY
to
-------------------------------
Trustee
JUNIOR SUBORDINATED INDENTURE
Dated as of ________ __, 1997
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
PAGE
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ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 102. Compliance Certificate and Opinions. . . . . . . . . . . . . . . 9
SECTION 103. Forms of Documents Delivered to Trustee. . . . . . . . . . . . .10
SECTION 104. Acts of Holders. . . . . . . . . . . . . . . . . . . . . . . . .10
SECTION 105. Notices, Etc. to Trustee and Company.. . . . . . . . . . . . . .11
SECTION 106. Notice to Holders; 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. . . . . . . . . . . . . . . . . . . . . . . . . .12
SECTION 113. Non-Business Days. . . . . . . . . . . . . . . . . . . . . . . .12
ARTICLE II
SECURITY FORMS
SECTION 201. Forms Generally. . . . . . . . . . . . . . . . . . . . . . . . .12
SECTION 202. Form of Face of Security.. . . . . . . . . . . . . . . . . . . .13
SECTION 203. Form of Reverse of Security. . . . . . . . . . . . . . . . . . .17
SECTION 204. Additional Provisions Required in Global Security. . . . . . . .20
SECTION 205. Form of Trustee's Certificate of Authentication. . . . . . . . .20
ARTICLE III
THE SECURITIES
SECTION 301. Title and Terms. . . . . . . . . . . . . . . . . . . . . . . . .20
SECTION 302. Denominations. . . . . . . . . . . . . . . . . . . . . . . . . .23
SECTION 303. Execution, Authentication, Delivery and Dating.. . . . . . . . .23
SECTION 304. Temporary Securities.. . . . . . . . . . . . . . . . . . . . . .24
SECTION 305. Registration, Transfer and Exchange. . . . . . . . . . . . . . .25
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.. . . . . . . .26
SECTION 307. Payment of Interest; Interest Rights Preserved.. . . . . . . . .27
SECTION 308. Persons Deemed Owners. . . . . . . . . . . . . . . . . . . . . .28
SECTION 309. Cancellation.. . . . . . . . . . . . . . . . . . . . . . . . . .28
SECTION 310. Computation of Interest. . . . . . . . . . . . . . . . . . . . .28
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(CONTINUED)
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SECTION 311. Deferrals of Interest Payment Dates. . . . . . . . . . . . . . .28
SECTION 312. Right of Set-Off.. . . . . . . . . . . . . . . . . . . . . . . .29
SECTION 313. Agreed Tax Treatment.. . . . . . . . . . . . . . . . . . . . . .30
SECTION 314. Extension of Stated Maturity; Adjustment of Stated Maturity
Upon an Exchange . . . . . . . . . . . . . . . . . . . . . . . .30
SECTION 315. CUSIP Numbers. . . . . . . . . . . . . . . . . . . . . . . . . .30
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture. . . . . . . . . . . . .30
SECTION 402. Application of Trust Money.. . . . . . . . . . . . . . . . . . .31
SECTION 403. Satisfaction, Discharge and Defeasance of Securities of Any
Series . . . . . . . . . . . . . . . . . . . . . . . . . . . . .32
ARTICLE V
REMEDIES
SECTION 501. Events of Default. . . . . . . . . . . . . . . . . . . . . . . .33
SECTION 502. Acceleration of Maturity; Rescission and Annulment.. . . . . . .34
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee.36
SECTION 504. Trustee May File Proofs of Claim.. . . . . . . . . . . . . . . .36
SECTION 505. Trustee May Enforce Claim Without Possession of Securities.. . .37
SECTION 506. Application of Money Collected.. . . . . . . . . . . . . . . . .37
SECTION 507. Limitation on Suits. . . . . . . . . . . . . . . . . . . . . . .38
SECTION 508. Unconditional Right of Holders to Receive Principal, Premium and
Interest.. . . . . . . . . . . . . . . . . . . . . . . . . . . .38
SECTION 509. Restoration of Rights and Remedies.. . . . . . . . . . . . . . .38
SECTION 510. Rights and Remedies Cumulative.. . . . . . . . . . . . . . . . .39
SECTION 511. Delay or Omission Not Waiver.. . . . . . . . . . . . . . . . . .39
SECTION 512. Control by Holders.. . . . . . . . . . . . . . . . . . . . . . .39
SECTION 513. Waiver of Past Defaults. . . . . . . . . . . . . . . . . . . . .40
SECTION 514. Undertaking for Costs. . . . . . . . . . . . . . . . . . . . . .40
SECTION 515. Waiver of Usury, Stay or Extension Laws. . . . . . . . . . . . .40
ARTICLE VI
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities. . . . . . . . . . . . . . .41
SECTION 602. Notice of Defaults.. . . . . . . . . . . . . . . . . . . . . . .42
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TABLE OF CONTENTS
(CONTINUED)
PAGE
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SECTION 603. Certain Rights of Trustee. . . . . . . . . . . . . . . . . . . .42
SECTION 604. Not Responsible for Recitals or Issuance of Securities.. . . . .43
SECTION 605. May Hold Securities. . . . . . . . . . . . . . . . . . . . . . .43
SECTION 606. Money Held in Trust. . . . . . . . . . . . . . . . . . . . . . .43
SECTION 607. Compensation and Reimbursement.. . . . . . . . . . . . . . . . .43
SECTION 608. Disqualification; Conflicting Interests. . . . . . . . . . . . .44
SECTION 609. Corporate Trustee Required; Eligibility. . . . . . . . . . . . .44
SECTION 610. Resignation and Removal; Appointment of Successor. . . . . . . .45
SECTION 611. Acceptance of Appointment by Successor.. . . . . . . . . . . . .46
SECTION 612. Merger, Conversion, Consolidation or Succession to Business. . .47
SECTION 613. Preferential Collection of Claims Against Company. . . . . . . .47
SECTION 614. Appointment of Authenticating Agent. . . . . . . . . . . . . . .48
ARTICLE VII
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders. . . .49
SECTION 702. Preservation of Information, Communications to Holders . . . . .49
SECTION 703. Reports by Trustee . . . . . . . . . . . . . . . . . . . . . . .50
SECTION 704. Reports by Company . . . . . . . . . . . . . . . . . . . . . . .50
ARTICLE VIII
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801 Company May Consolidate, Etc., Only on Certain Terms . . . . . .51
SECTION 802. Successor Person Substituted . . . . . . . . . . . . . . . . . .51
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders. . . . . . .52
SECTION 902. Supplemental Indentures with Consent of Holders . . . . . . . .53
SECTION 903. Execution of Supplemental Indentures. . . . . . . . . . . . . .55
SECTION 904. Effect of Supplemental Indentures . . . . . . . . . . . . . . .55
SECTION 905. Conformity with Trust Indenture Act . . . . . . . . . . . . . .55
SECTION 906. Reference in Securities to Supplemental Indentures. . . . . . .55
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TABLE OF CONTENTS
(CONTINUED)
PAGE
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ARTICLE X
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest . . . . . . . . . .55
SECTION 1002. Maintenance of Office or Agency. . . . . . . . . . . . . . . .56
SECTION 1003. Money for Security Payments to be Held in Trust. . . . . . . .56
SECTION 1004. Statement as to Compliance . . . . . . . . . . . . . . . . . .57
SECTION 1005. Waiver of Certain Covenants. . . . . . . . . . . . . . . . . .58
SECTION 1006. Additional Sums. . . . . . . . . . . . . . . . . . . . . . . .58
SECTION 1007. Additional Covenants . . . . . . . . . . . . . . . . . . . . .58
ARTICLE XI
REDEMPTION OF SECURITIES
SECTION 1101. Applicability of This Article. . . . . . . . . . . . . . . . .59
SECTION 1102. Election to Redeem; Notice to Trustee. . . . . . . . . . . . .59
SECTION 1103. Selection of Securities to be Redeemed . . . . . . . . . . . .60
SECTION 1104. Notice of Redemption . . . . . . . . . . . . . . . . . . . . .60
SECTION 1105. Deposit of Redemption Price. . . . . . . . . . . . . . . . . .61
SECTION 1106. Payment of Securities Called for Redemption. . . . . . . . . .61
SECTION 1107. Company's Right of Redemption. . . . . . . . . . . . . . . . .62
ARTICLE XII
SINKING FUNDS
SECTION 1201. Applicability of Article . . . . . . . . . . . . . . . . . . .62
SECTION 1202. Satisfaction of Sinking Fund Payments with Securities. . . . .63
SECTION 1203. Redemption of Securities for Sinking Fund. . . . . . . . . . .63
ARTICLE XIII
Subordination of Securities
SECTION 1301. Securities Subordinate to Senior Debt. . . . . . . . . . . . .64
SECTION 1302. Payment Over of Proceeds Upon Dissolution, Etc . . . . . . . .65
SECTION 1303. Prior Payment to Senior Debt Upon Acceleration of Securities .66
SECTION 1304. No Payment When Senior Debt in Default . . . . . . . . . . . .66
SECTION 1305. Payment Permitted If No Default. . . . . . . . . . . . . . . .67
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TABLE OF CONTENTS
(CONTINUED)
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SECTION 1306. Subrogation to Rights of Holders of Senior Debt. . . . . . . .67
SECTION 1307. Provisions Solely to Define Relative Rights. . . . . . . . . .68
SECTION 1308. Trustee to Effectuate Subordination. . . . . . . . . . . . . .68
SECTION 1309. No Waiver of Subordination Provisions. . . . . . . . . . . . .68
SECTION 1310. Notice to Trustee. . . . . . . . . . . . . . . . . . . . . . .68
SECTION 1311. Reliance on Judicial Order or Certificate of
Liquidating Agent . . . . . . . . . . . . . . . . . . . . . .69
SECTION 1312. Trustee Not Fiduciary for Holders of Senior Debt . . . . . . .69
SECTION 1313. Rights of Trustee as Holder of Senior Debt; Preservation of
Trustee's Rights . . . . . . . . . . . . . . . . . . . . . . .69
SECTION 1314. Article Applicable to Paying Agents. . . . . . . . . . . . . .69
SECTION 1315. Certain Conversions or Exchanges Deemed Payment. . . . . . . .70
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<PAGE>
NEVADA POWER COMPANY
Reconciliation and the between the Trust Indenture Act of 1939
(including cross-references to provisions of Sections 310 to and including 317
which, pursuant to Section 318(c) of the Trust Indenture Act of 1939, as amended
by the Trust Reform Act of 1990, are a part of and govern the Indenture whether
or not physically contained therein) and the Junior Subordinated Indenture,
dated as of ________ __, 1997.
JUNIOR SUBORDINATED INDENTURE, dated as of ________ __, 1997 between
____________________, a Nevada corporation (hereinafter called the "Company")
having its principal office at 6226 West Sahara Avenue, Las Vegas, NV 89102, and
_________________ a ____________ duly organized and existing under the laws of
the ________________, as Trustee (hereinafter called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured junior
subordinated debt securities in series (hereinafter called the "Securities") of
substantially the tenor hereinafter provided, including, without limitation,
Securities issued to evidence loans made to the Company of the proceeds from the
issuance from time to time by one or more business trusts (each an "NVP Trust",
and collectively, the "NVP Trusts") of preferred trust interests in such Trusts
(the "Preferred Securities") and common interests in such Trusts (the "Common
Securities" and, collectively with the Preferred Securities, the "Trust
Securities"), and to provide the terms and conditions upon which the Securities
are to be authenticated, issued and delivered.
All things necessary to make the Securities, when executed by the
Company and authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company, and to make this Indenture a
valid agreement of the Company, in accordance with their and its terms, have
been done.
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 I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. DEFINITIONS. For all purposes of this Indenture, except
as otherwise expressly provided or unless the context otherwise requires:
- 1 -
<PAGE>
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles, and the term "generally accepted accounting principles" with
respect to any computation required or permitted hereunder shall mean such
accounting principles which are generally accepted at the date or time of
such computation; and
(4) 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 Six, are defined in that
Article.
"Act", when used with respect to any Holder, has the meaning specified
in Section 104.
"ADDITIONAL INTEREST" means the interest, if any, that shall accrue on
any interest on the Securities of any series the payment of which has not been
made on the applicable Interest Payment Date and which shall accrue at the rate
per annum specified or determined as specified in such Security.
"ADDITIONAL SUMS" has the meaning specified in Section 1006.
"ADDITIONAL TAXES" means the sum of any additional taxes, duties and
other governmental charges to which an NVP Trust has become subject from time to
time as a result of a Tax Event.
"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; provided, however, that an Affiliate of the
Company shall not be deemed to include any NVP Trust to which Securities have
been issued. For the purposes of this definition, "control" when used with
respect to any specified Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"AUTHENTICATING AGENT" means any Person authorized by the Trustee
pursuant to Section 614 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"BOARD OF DIRECTORS" means either the board of directors of the
Company or any committee of that board duly authorized to act hereunder.
- 2 -
<PAGE>
"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, or such committee of the Board of Directors or officers
of the Company to which authority to act on behalf of the Board of Directors has
been delegated, and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"BUSINESS DAY" means any day other than (I) a Saturday or Sunday, (ii)
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 (iii) a day on which the
Corporate Trust Office of the Trustee, or, with respect to the Securities of a
series issued to an NVP Trust, the principal office of the Property Trustee
under the related Trust Agreement, is closed for business.
"COMMISSION" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934, 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 on such date.
"COMMON SECURITIES" has the meaning specified in the first recital of
this Indenture.
"COMMON STOCK" means the common stock, $1.00 par value per share, of
the Company.
"COMPANY" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"COMPANY REQUEST" and "COMPANY ORDER" mean, respectively, the written
request or order signed in the name of the Company by its Chairman of the Board,
its Vice Chairman, its President or a Vice President, and by its Treasurer, an
Assistant Treasurer, its Controller, its Secretary or an Assistant Secretary,
and delivered to the Trustee.
"CORPORATE TRUST OFFICE" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered.
"CORPORATION" means a corporation, association, company, joint-stock
company or business trust.
"DEBT" means, with respect to any Person, whether recourse is to all
or a portion of the assets of such person and whether or not contingent, (i)
every obligation of such person for money borrowed; (ii) every obligation of
such person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such person; (iv) every obligation of such person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business);
- 3 -
<PAGE>
(v) every capital lease obligation of such person; and (vi) every obligation of
the type referred to in clauses (i) through (v) of another person and all
dividends of another person the payment of which, in either case, such person
has guaranteed or is responsible or liable for, directly or indirectly, as
obligor or otherwise.
"DEFAULTED INTEREST" has the meaning specified in Section 307.
"DEPOSITARY" means, with respect to the Securities of any series
issuable or issued in whole or in part in the form of one or more Global
Securities, the person designated as Depositary by the Company pursuant to
Section 301 with respect to such series (or any successor thereto).
"DISCOUNT SECURITY" means any security which provides for an amount
less than the principal amount thereof to be due and payable upon a declaration
of acceleration of the maturity thereof pursuant to Section 502.
"DOLLAR" means the currency of the United States of America that, as
at the time of payment, is legal tender for the payment of public and private
debts.
"EVENT OF DEFAULT" unless otherwise specified in the supplemental
indenture creating a series of Securities, has the meaning specified in Article
V.
"EXTENSION PERIOD" has the meaning specified in Section 311.
"FOREIGN CURRENCY" means any currency issued by the government of one
or more countries other than the United States of America or by any recognized
confederation or association of such governments.
"GLOBAL SECURITY" means a Security in the form prescribed in Section
204 evidencing all or part of a series of Securities, issued to the Depositary
or its nominee for such series, and registered in the name of such Depositary or
its nominee.
"GOVERNMENT OBLIGATIONS" means, with respect to the Securities of any
series, securities which are (i) direct obligations of the United States of
America or (ii) obligations of a Person controlled or supervised by and acting
as an agency or instrumentality of the United States of America the payment of
which is unconditionally guaranteed by the United States of America and which,
in either case, are full faith and credit obligations of the United States of
America and are not callable or redeemable at the option of the issuer thereof
and shall also include a depository receipt issued by a bank (as defined in
Section 3(a)(2) of the Securities Act of 1933, as amended) as custodian with
respect to any such Government Obligation or a specific payment of interest on
or principal of any such Government Obligation held by such custodian for the
account of the holder of such depository receipt; provided that (except as
required by law) such custodian is not authorized to make any deduction from the
amount payable to the holder of such depository receipt from any amount received
by the custodian in respect of the Government Obligation or the specific payment
of interest on or principal of the Government Obligation evidenced by such
depository receipt.
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"HOLDER" means a Person in whose name a Security is registered in the
Securities Register.
"JUNIOR SUBORDINATED PAYMENT" has the meaning specified in Section
1302.
"INDENTURE" means this instrument as originally executed or 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 each particular series of Securities established
as contemplated by Section 301.
"INTEREST PAYMENT DATE" means as to each series of Securities the
Stated Maturity of an installment of interest on such Securities.
"INTEREST RATE" means the rate of interest specified or determined as
specified in each Security as being the rate of interest payable on such
Security.
"INVESTMENT COMPANY EVENT" means, in respect of an NVP Trust, the
receipt by an NVP Trust of an Opinion of Independent Counsel, rendered by a law
firm having a recognized national tax and securities practice, to the effect
that, as a result of 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 (a "Change in 1940 Act Law"),
such NVP Trust is or will be considered an "investment company" that is required
to be registered under the 1940 Act, which Change in 1940 Act Law becomes
effective on or after the date of original issuance of the Preferred Securities
of such NVP Trust.
"LIEN" means any mortgage, pledge, lien, security interest or other
encumbrance.
"MATURITY", when used with respect to any Security, means the date on
which the principal of such Security becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
"NVP TRUST" has the meaning specified in the first recital of this
Indenture.
"1940 ACT" means the Investment Company Act of 1940, as amended.
"NEVADA POWER GUARANTEE" means the guarantee by the Company of
distributions on the Preferred Securities of an NVP Trust to the extent provided
in the Guarantee Agreement, substantially in the form attached hereto as Annex
C, or substantially in such form as may be specified as contemplated by Section
301 with respect to the Securities of any series, in each case as amended from
time to time.
"NOTICE OF DEFAULT" has the meaning specified in Section 501(3).
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<PAGE>
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman and
Chief Executive Officer, President or a Vice President, and by the Treasurer, an
Assistant Treasurer, the Controller, the Secretary or an Assistant Secretary of
the Company, and delivered to the Trustee.
"OPINION OF COUNSEL" means a written opinion of counsel, who may be
counsel for the Company or General Counsel of the Company.
"OPINION OF INDEPENDENT COUNSEL" means a written opinion of counsel,
who may be counsel for the Company.
"ORIGINAL ISSUE DATE" means the date of issuance specified as such in
each Security.
"OUTSTANDING" means, when used in reference to any Securities, as of
the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(i) Securities theretofore cancelled by the Trustee or delivered to
the Trustee for cancellation;
(ii) Securities for whose payment money in the necessary amount has
been theretofore deposited with the Trustee or any Paying Agent in trust
for the Holders of such Securities; and
(iii) Securities in substitution for or in lieu of which other
Securities have been authenticated and delivered or which have been paid
pursuant to Section 306, unless proof satisfactory to the Trustee is
presented that any such Securities are held by Holders in whose hands such
Securities are valid, binding and legal obligations of the Company;
PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities which the Trustee knows to be so owned shall
be so disregarded. 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 such other obligor. Upon the written request of
the Trustee, the Company shall furnish to the Trustee promptly an Officers'
Certificate listing and identifying all Securities, if any, known by the Company
to be owned or held by or for the account of the Company, or any other obligor
on the Securities or any Affiliate of the Company or such obligor, and, subject
to the provisions of Section 601, the Trustee shall be entitled to accept such
Officers' Certificate as conclusive evidence of the facts therein set forth and
of the fact that all Securities not listed therein are Outstanding for the
purpose of any such determination.
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<PAGE>
"PAYING AGENT" means the Trustee or any Person authorized by the
Company to pay the principal of or interest on any Securities on behalf of the
Company.
"PERSON" means any individual, corporation, partnership, joint
venture, association, trust, unincorporated organization or government or any
agency or political subdivision thereof.
"PLACE OF PAYMENT" means, with respect to the Securities of any
series, the place or places where the principal of (and premium, if any) and
interest on the Securities of such series are payable pursuant to Section 301 or
311.
"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 lieu of a lost, destroyed or
stolen Security shall be deemed to evidence the same debt as the lost, destroyed
or stolen Security.
"PREFERRED SECURITIES" has the meaning specified in the first recital
of this Indenture.
"PROCEEDING" has the meaning specified in Section 1302.
"PROPERTY TRUSTEE" means, in respect of any NVP Trust, the commercial
bank or trust company identified as the "Property Trustee" in the related Trust
Agreement, solely in its capacity as Property Trustee of such NVP Trust under
such Trust Agreement and not in its individual capacity, or its successor in
interest in such capacity, or any successor property trustee appointed as
therein provided.
"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.
"REGULAR RECORD DATE" for the interest payable on any Interest Payment
Date with respect to the Securities of a series means, unless otherwise provided
pursuant to Section 301 with respect to Securities of a series, the date which
is fifteen days next preceding such Interest Payment Date (whether or not a
Business Day).
"RESPONSIBLE OFFICER" when used with respect to the Trustee means any
officer of the Trustee assigned by the Trustee from time to time to administer
its corporate trust matters.
"SECURITIES" or "SECURITY" means any debt securities or debt security,
as the case may be, authenticated and delivered under this Indenture.
"SECURITIES REGISTER" and "SECURITIES REGISTRAR" have the respective
meanings specified in Section 305.
"SENIOR DEBT" means the principal of (and premium, if any) and
interest, if any (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization
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<PAGE>
relating to the Company whether or not such claim for post-petition interest is
allowed in such proceeding), on Debt, whether incurred on or prior to the date
of this Indenture or thereafter incurred, unless, in the instrument creating or
evidencing the same or pursuant to which the same is outstanding, it is provided
that such obligations are not superior in right of payment to the Securities or
to other Debt which is pari passu with, or subordinated to, the Securities,
provided, however, that Senior Debt shall not be deemed to include (a) any Debt
of the Company which when incurred and without respect to any election under
Section 1111(b) of the Bankruptcy Reform Act of 1978, was without recourse to
the Company, (b) any Debt of the Company to any of its Subsidiaries, (c) Debt to
any employee of the Company, (d) any liability for taxes, (e) Debt or other
monetary obligations to trade creditors created or assumed by the Company or any
of its Subsidiaries in the ordinary course of business in connection with the
obtaining of goods, materials or services and (f) the Securities.
"SPECIAL EVENT" means a Tax Event or an Investment Company Event.
"SPECIAL RECORD DATE" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.
"STATED MATURITY", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
pursuant to the terms of such Security as the date on which the principal of
such Security or such installment of interest is due and payable.
"SUBSIDIARY" means a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company or by one
or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For the purposes of this definition, "voting stock" means stock
which ordinarily has voting power for the election of directors, whether at all
times or only so long as no senior class of stock has such voting power by
reason of any contingency.
"TAX EVENT" means the receipt by an NVP Trust of an Opinion of
Independent Counsel, rendered by a law firm having a recognized national tax and
securities practice, 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, or as a result of any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or which
pronouncement or decision is announced on or after the date of issuance of the
Preferred Securities of such NVP Trust, there is more than an insubstantial risk
that (i) the NVP Trust is, or will be within 90 days of the date of such Opinion
of Independent Counsel, subject to United States federal income tax with respect
to income received or accrued on the corresponding series of Securities, (ii)
interest payable by the Company on the corresponding series of Securities is
not, or within 90 days of the date of such Opinion of Independent Counsel, will
not be, deductible, in whole or in part, for United States federal income tax
purposes or (iii) the NVP Trust is, or will be within 90 days of the date of
such Opinion of Independent Counsel, subject to more than a de minimis amount of
other taxes, duties or other governmental charges.
"TRUST AGREEMENT" means the Trust Agreement substantially in the form
attached hereto as Annex A, as amended by the form of Amended and Restated Trust
Agreement substantially
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<PAGE>
in the form attached hereto as Annex B, or substantially in such form as may be
specified as contemplated by Section 301 with respect to the Securities of any
series, in each case as amended from time to time.
"TRUSTEE" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who 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.
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbb), as amended and as in effect on the date as of this
Indenture, except as provided in Section 905.
"TRUST SECURITIES" has the meaning specified in the first recital of
this Indenture.
"VICE PRESIDENT" when used with respect to the Company, means any duly
appointed vice president, whether or not designated by a number or a word or
words added before or after the title "vice president."
SECTION 102. COMPLIANCE CERTIFICATE AND OPINIONS. Upon any
application or request by the Company to the Trustee to take any action under
any provision of this Indenture, the Company shall furnish to the Trustee an
Officers' Certificate stating that all conditions precedent (including
covenants, compliance with which constitutes a condition precedent), if any,
provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent (including covenants compliance with which
constitute a condition 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 (other than the
certificates provided pursuant to Section 1005) shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
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<PAGE>
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 103. FORMS 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 matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 104. ACTS OF HOLDERS. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given to 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; and, except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments is or are delivered to the Trustee, and, where it
is hereby expressly required, to the Company. Such instrument or instruments
(and the action embodied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Holders signing such instrument or instruments.
Proof of execution of any such instrument or of a writing appointing any such
agent shall be sufficient for any purpose of this Indenture and (subject to
Section 601) conclusive in favor of the Trustee and the Company, if made in the
manner provided in this Section.
(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 the certificate of any notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a Person acting in other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority.
(c) The fact and date of the execution by any Person of any such
instrument or writing, or the authority of the Person executing the same, may
also be proved in any other manner
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<PAGE>
which the Trustee deems sufficient and in accordance with such reasonable rules
as the Trustee may determine.
(d) The ownership of Securities shall be proved by the Securities
Register.
(e) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Security shall bind every future
Holder of the same Security and the Holder of every Security issued upon the
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done 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.
(f) The Company may, but shall not be obligated to, fix a record date
for the purpose of determining the Holders entitled to take any action under
this Indenture by vote or consent. Except as otherwise provided herein, such
record date shall be the later of 30 days prior to the first solicitation of
such consent or vote or the date of the most recent list of Securityholders
furnished to the Trustee pursuant to Section 701 prior to such solicitation. If
a record date is fixed, those persons who were Securityholders at such record
date (or their duly designated proxies), and only those persons, shall be
entitled to take such action by vote or consent or to revoke any vote or consent
previously given, whether or not such persons continue to be Holders after such
record date, provided, however, that unless such vote or consent is obtained
from the Holders (or their duly designated proxies) of the requisite principal
amount of Outstanding Securities prior to the date which is the 120th day after
such record date, any such vote or consent previously given shall automatically
and without further action by any Holder be canceled and of no further effect.
SECTION 105. NOTICES, ETC. TO TRUSTEE AND COMPANY. Any request,
demand, authorization, direction, notice, consent, waiver or Act of Holders or
other document provided or permitted by this Indenture to be made upon, given or
furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing to or
with the Trustee at its Corporate Trust office, or
(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose (except as otherwise provided in Section 501 hereof) hereunder
if in writing and mailed, first class, postage prepaid, to the Company addressed
to it at the address of its principal office specified in the first paragraph of
this instrument or at any other address previously furnished in writing to the
Trustee by the Company.
SECTION 106. NOTICE TO HOLDERS; WAIVER. Where this Indenture
provides for notice to Holders of any event, such notice shall be sufficiently
given (unless otherwise herein expressly provided) if in writing and mailed,
first class postage prepaid, to each Holder affected by such event, at the
address of such Holder as it appears in the Securities Register, not later than
the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed,
to any particular Holder shall affect the sufficiency of such notice with
respect to other
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<PAGE>
Holders. Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
SECTION 107. CONFLICT WITH TRUST INDENTURE ACT. If any provision of
this Indenture limits, qualifies or conflicts with the duties imposed by any of
Sections 310 to 317, inclusive, of the Trust Indenture Act through operation of
Section 318(c) thereof, such imposed duties shall control.
SECTION 108. EFFECT OF HEADINGS AND TABLE OF CONTENTS. The Article
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.
SECTION 109. SUCCESSORS AND ASSIGNS. All covenants and agreements in
this Indenture by the Company shall bind its successors and assigns, whether so
expressed or not.
SECTION 110. SEPARABILITY CLAUSE. In case any provision in this
Indenture or in the 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 in
the Securities, express or implied, shall give to any Person, other than the
parties hereto, any Paying Agent and their successors and assigns, the holders
of Senior Debt and the Holders of the Securities, any benefit or any legal or
equitable right, remedy or claim under this Indenture.
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.
SECTION 113. NON-BUSINESS DAYS. In any case where any Interest
Payment Date, Redemption Date or Stated Maturity of any Security shall not be a
Business Day, then (notwithstanding any other provision of this Indenture or the
Securities) payment of interest or principal need not be made on such date, but
may be made on the next succeeding Business Day (and no interest shall accrue
for the period from and after such Interest Payment Date, Redemption Date or
Stated Maturity, as the case may be, until such next succeeding Business Day),
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 or
Redemption Date or at the Stated Maturity).
ARTICLE II
SECURITY FORMS
SECTION 201. FORMS GENERALLY. The Securities of each series and the
Trustee's certificate of authentication shall be in substantially the forms set
forth in this Article, or in such other
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form or forms as shall be established by or pursuant to a Board Resolution or in
one or more indentures supplemental hereto, in each case with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with applicable tax laws or 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 of Securities of any series is established by action taken pursuant
to a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Company Order
contemplated by Section 303 with respect to the authentication and delivery of
such Securities.
The Trustee's certificates of authentication shall be substantially in
the form set forth in this Article.
The definitive Securities shall be printed, lithographed or engraved
or produced by any combination of these methods, if required by any securities
exchange, the Nasdaq National Market or other applicable interdealer quotation
system or self-regulatory organization on which the Securities may be listed or
traded, on a steel engraved border or steel engraved borders or may be produced
in any other manner permitted by the rules of any securities exchange, the
Nasdaq National Market or other applicable interdealer quotation system or self-
regulatory organization on which the Securities may be listed or traded, all as
determined by the officers executing such Securities, as evidenced by their
execution of such securities.
SECTION 202. FORM OF FACE OF SECURITY. [If the Security is a Global
Security, insert - This Security is a Global Security within the meaning of the
Indenture hereinafter referred to and is registered in the name of The
Depository Trust Company (the "Depository") or a nominee of the Depository. This
Security is exchangeable for Securities registered in the name of a person other
than the Depository or its nominee only in the limited circumstances described
in the Indenture and no transfer of this Security (other than a transfer of this
Security as a whole by the Depository to a nominee of the Depository or by a
nominee of the Depository to the Depository or another nominee of the
Depository) may be registered except in limited circumstances.
Unless this Security is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York) to Nevada Power Company
or its agent for registration of transfer, exchange or payment, and any Security
issued is registered in the name of Cede & Co. or such other name as requested
by an authorized representative of The Depository Trust Company and any payment
hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY A PERSON IS WRONGFUL inasmuch as the registered owner hereof,
Cede & Co., has an interest herein.]
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<PAGE>
NEVADA POWER COMPANY
(Title of Security)
No. __________ $_____________
CUSIP ________
Nevada Power Company, a corporation organized and existing under the
laws of Nevada (hereinafter called the "Company", which term includes any
successor corporation under the Indenture hereinafter referred to), for value
received, hereby promises to pay to _______________, or registered assigns, the
principal sum of _____________ Dollars on ______ __, ____[; provided, that the
Company may (i) change the maturity date upon the occurrence of an exchange of
the Securities for the Trust Securities subject to certain conditions set forth
in Section 314 of the Indenture, which changed maturity date shall in no case be
earlier than ______ __, ____ or later than _______ __, ____ and (ii) extend the
maturity date subject to certain conditions specified in Section 314 of the
Indenture, which extended maturity date shall in no case be later than _______
__, ____]. The Company further promises to pay interest on said principal sum
from ______, ___ or from the most recent interest payment date (each such date,
an "Interest Payment Date") on which interest has been paid or duly provided
for, [monthly] [quarterly] [semi-annually] [if applicable, insert-(subject to
deferral as set forth herein)] in arrears on [insert applicable Interest Payment
Dates] of each year, commencing ______, ___, at the rate of ___% per annum,
until the principal hereof shall have become due and payable, [if applicable,
insert- plus Additional Interest, if any,] until the principal hereof is paid or
duly provided for or made available for payment [if applicable, insert- and on
any overdue principal and (without duplication and to the extent that payment of
such interest is enforceable under applicable law) on any overdue installment of
interest at the rate of ___% per annum, compounded [monthly] [quarterly]
[annually]. The amount of interest payable for any period shall be computed on
the basis of [twelve 30-day months] and a [360- day] year. The amount of
interest payable for any partial period shall be computed on the basis of the
number of days elapsed in a [360-day] year of [twelve 30-day months]. In the
event that any date on which interest is payable on this Security is not a
Business Day, then a 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. A "Business Day"
shall mean any day other than (i) a Saturday or Sunday, (ii) 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 (iii) a day on which the Corporate Trust
Office of the Trustee [if applicable, insert-, or the principal office of the
Property Trustee under the Trust Agreement hereinafter referred to for NVP
Capital __,] is closed for business. The interest installment so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Indenture, be paid to the Person in whose name this Security (or
one or more Predecessor Securities, as defined in the Indenture) is registered
at the close of business on the Regular Record Date for such interest
installment, which shall be the [insert definition of Regular Record Dates]. Any
such interest installment not so punctually paid or duly provided for shall
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
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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, the Nasdaq National Market or other
applicable interdealer quotation system or self-regulatory organization on which
the Securities of this series may be listed or traded, and upon such notice as
may be required by such exchange or other self-regulatory organization, all as
more fully provided in said Indenture.
[If applicable, insert- The Company shall have the right at any time
during the term of this Security, from time to time, to defer the payment of
interest on such Security for up to __ consecutive [monthly] [quarterly]
[semi-annual] interest payment periods with respect to each deferral period
(each an "Extension Period"), during which Extension Periods the Company shall
have the right to make partial payments of interest on any Interest Payment
Date, and at the end of which the Company shall pay all interest then accrued
and unpaid (together with Additional Interest thereon to the extent permitted by
applicable law); provided that during any such Extension Period, the Company
will not, and will not permit any Subsidiary of the Company to (i) declare or
pay any dividends or distributions or redeem, purchase, acquire or make a
liquidation payment with respect to, any of the Company's outstanding capital
stock or (ii) make any payment of principal, interest or premium, if any, on or
repay, repurchase or redeem any debt security that ranks pari passu with or
junior in interest to this Security or make any guarantee payments with respect
to the foregoing (other than (a) dividends or distributions in Common Stock of
the Company, (b) redemptions or purchases of any rights pursuant to the
Company's Preferred Stock Purchase Rights Plan, or any successor to such
Preferred Stock Purchase Rights Plan, and the declaration of a dividend of such
rights or the issuance of Preferred Stock under such plans in the future, (c)
payments under any Nevada Power Guarantee, (d) purchases of Common Stock related
to the issuance of Common Stock under any of the Company's benefit plans for its
directors, officers or employees and (e) purchases of Common Stock required to
prevent the loss or secure the renewal or reinstatement of any government
license or franchise held by the Company or any of its Subsidiaries). Prior to
the termination of any such Extension Period, the Company may further extend the
interest payment period, provided that no Extension Period shall exceed __
consecutive [months] [quarters] [semi-annual periods] or extend beyond the
Maturity of this Security. Upon the termination of any such Extension Period
and upon the payment of all accrued and unpaid interest and any Additional
Interest then due, the Company may elect to begin 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 shall give the
Holder of this Security and the Trustee notice of its election to begin any
Extension Period at least one Business Day prior to the Interest Payment Date
[if applicable, insert- or, with respect to the Securities issued to an NVP
Trust, prior to the earlier of (i) the date the Distributions on the Preferred
Securities are payable or (ii) the date the Administrative Trustees are required
to give notice to any securities exchange, the Nasdaq National Market or other
applicable interdealer quotation system or self- regulatory organization or to
holders of such Preferred Securities of the record date or the date such
Distributions are payable, but in any event not less than one Business Day prior
to such record date].
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 United States, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment
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<PAGE>
of public and private debts [if applicable, insert-; provided, however, that at
the option of the Company payment of interest may be made (i) by check mailed to
the address of the Person entitled thereto as such address shall appear in the
Securities Register or (ii) by wire transfer in immediately available funds at
such place and to such account as may be designated by the Person entitled
thereto as specified in the Securities Register].
The indebtedness evidenced by this Security is, to the extent provided
in the Indenture, subordinate and subject in right of payments to the prior
payment in full of all Senior Debt, 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 actions as may be
necessary or appropriate to 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, waives all notice of the acceptance of
the subordination provisions contained herein and in the Indenture by each
holder of Senior Debt, whether now outstanding or hereafter incurred, and waives
reliance by each such holder upon said provisions.
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 under its corporate seal.
Dated:
NEVADA POWER COMPANY
By: _________________________________________
[President or Vice President]
Attest:
[Secretary or Assistant Secretary]
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SECTION 203. FORM OF REVERSE OF SECURITY. 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 a Junior
Subordinated Indenture, dated as of ________ __, 1997 (herein called the
"Indenture"), between the Company and _________________, as Trustee (herein
called the "Trustee", which term includes any successor trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights, limitations of rights,
duties and immunities thereunder of the Trustee, the Company 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 $___________].
All terms used in this Security that are defined in the Indenture [if
applicable, insert- or in the Trust Agreement, dated _________ __, ____, as
amended (the "Trust Agreement"), for NVP Capital __ among Nevada Power Company,
as Depositor, and the Trustees named therein] shall have the meanings assigned
to them in the Indenture [if applicable, insert- or the Trust Agreement, as the
case may be].
[If applicable, insert- On or after _________ __, ____, the Company
may at any time, at its option, subject to the terms and conditions of Article
Eleven of the Indenture, redeem this Security in whole at any time or in part
from time to time, without premium or penalty, at a redemption price equal to
100% of the principal amount thereof plus the accrued and unpaid interest [if
applicable, insert-, including Additional Interest, if any,] to the date fixed
for redemption.
[If applicable, insert- If a Special Event in respect of an NVP Trust
shall occur and be continuing, the Company may, at its option, redeem this
Security within 90 days of the occurrence of such Special Event, in whole but
not in part, subject to the provisions of Section 1107 and the other provisions
of Article XI of the Indenture, at a redemption price equal to 100% of the
principal amount thereof plus accrued and unpaid interest, including Additional
Interest, if any, to the date fixed for redemption.]
In the event of redemption of this Security in part only, a new
Security or Securities of this series for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation hereof.
[If the Security is not a Discount Security, - If an Event of Default
with respect to Securities of this series shall occur and be continuing, the
principal of this Security may be declared due and payable in the manner, with
the effect and subject to the conditions provided in the Indenture.]
[If the Security is a Discount Security, - If an Event of Default with
respect to Securities of this series shall occur and be continuing, an amount of
principal of this Security may be declared due and payable in the manner, with
the effect and subject to the conditions provided in the Indenture. Such amount
shall be equal to [- insert formula for determining the amount]. Upon payment
(i) of the amount of principal so declared due and payable and (ii) of interest
on any overdue principal and overdue interest (in each case to the extent that
the payment of such interest shall be
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<PAGE>
legally enforceable), all of the Company's obligations in respect of the payment
of the principal of and interest, if any, on this Security shall terminate.]
The Indenture contains provisions for satisfaction, discharge and
defeasance at any time of the entire indebtedness of this Security upon
compliance by the Company with certain conditions set forth in the Indenture.
The Indenture permits, with certain exceptions as therein provided,
the Company and the Trustee at any time to enter into a supplemental indenture
or indentures for the purpose of modifying in any manner the rights and
obligations of the Company and of the Holders of the Securities, with the
consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities of each series to be affected by such supplemental
indenture. The Indenture also contains provisions permitting 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.
[If the Security is not a Discount Security, - As provided in and
subject to the provisions of the Indenture, if an Event of Default with respect
the Securities of this series at the time Outstanding occurs and is continuing,
then and in every such case the Trustee or the Holders of not less than 25% in
principal amount of the Outstanding Securities of this series may declare the
principal amount of all the Securities of this series to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee if given
by Holders), provided that, in the case of the Securities of this series issued
to an NVPTrust, if upon an Event of Default, the Trustee or the Holders of not
less than 25% in principal amount of the Outstanding Securities of this series
fails to declare the principal of all the Securities of this series to be
immediately due and payable, the holders of at least 25% in aggregate
liquidation amount of the corresponding series of Preferred Securities then
outstanding shall have such right by a notice in writing to the Company and the
Trustee; and upon any such declaration such principal amount of and the accrued
interest (including any Additional Interest) on all the Securities of this
series shall become immediately due and payable, provided that the payment of
principal and interest (including any Additional Interest) on such Securities
shall remain subordinated to the extent provided in Article Thirteen of the
Indenture.
[If the Security is a Discount Security, - As provided in and subject
to the provisions of the Indenture, if an Event of Default with respect the
Securities of this series at the time Outstanding occurs and is continuing, then
and in every such case the Trustee or the Holders of not less than such portion
of the principal amount as may be specified in the terms of this series of all
the Securities of this series to be due and payable immediately, by a notice in
writing to the Company (and to the Trustee if given by Holders), provided that,
in the case of the Securities of a series issued to an NVP Trust, if upon an
Event of Default, the Trustee or the Holders of not less than 25% in principal
amount of the Outstanding Securities of this series fails to declare the
principal of all the Securities of that series to be immediately due and
payable, the holders of at least 25% in aggregate
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<PAGE>
liquidation amount of the corresponding series of Preferred Securities then
outstanding shall have such right by a notice in writing to the Company and the
Trustee; and upon any such declaration such specified amount of and the accrued
interest (including any Additional Interest) on all the Securities of this
series shall become immediately due and payable, provided that the payment of
principal and interest (including any Additional Interest) on such Securities
shall remain subordinated to the extent provided in Article Thirteen of the
Indenture.
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 premium, if any) and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the
Securities Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company maintained under Section 1002 of
the Indenture duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Securities Registrar duly
executed by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities of this series, of authorized denominations
and for the same aggregate principal amount, will be issued to the designated
transferee or transferees. No service charge shall be made for any such
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge payable in
connection therewith.
Prior to due presentment of this 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 this Security is registered as the 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.
The Securities of this series are issuable only in registered form
without coupons in denominations of $____ and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal amount
of Securities of such series of a different authorized denomination, as
requested by the Holder surrendering the same.
The Company and, by its acceptance of this Security or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Security agree that for United States federal, state and local
tax purposes it is intended that this Security constitute indebtedness.
THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF
LAWS PRINCIPLES THEREOF.
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SECTION 204. ADDITIONAL PROVISIONS REQUIRED IN GLOBAL SECURITY. Any
Global Security issued hereunder shall, in addition to the provisions contained
in Sections 202 and 203 bear a legend in substantially the following form:
"This Security is a Global Security within the meaning of the
Indenture hereinafter referred to and is registered in the name of a
Depositary or a nominee of a Depositary. This Security is
exchangeable for Securities registered in the name of a person other
than the Depositary or its nominee only in the limited circumstances
described in the Indenture and may not be transferred except as a
whole by the Depositary to a nominee of the Depositary or by a nominee
of the Depositary to the Depositary or another nominee of the
Depositary."
SECTION 205. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION. This
is one of the Securities referred to in the within mentioned Indenture.
_________________________________
as Trustee
By: _____________________________
Authorized Officer
ARTICLE III
THE SECURITIES
SECTION 301. TITLE AND TERMS. The aggregate principal amount of
Securities which may be authenticated and delivered under this Indenture is
unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution, and set forth in an Officers'
Certificate, or established in one or more indentures supplemental hereto, prior
to the issuance of Securities of a series:
(a) the title of the securities of such series, which shall
distinguish the Securities of the series from all other Securities;
(b) the limit, if any, 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 the series pursuant to Section 304, 305, 306, 906 or 1106);
provided, however, that the authorized aggregate principal amount of such
series may be increased above such amount by a Board Resolution to such
effect;
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<PAGE>
(c) the Stated Maturity or Maturities on which the principal of the
Securities of such series is payable or the method of determination
thereof;
(d) the rate or rates, if any, at which the Securities of such series
shall bear interest, if any, the rate or rates and extent to which
Additional Interest, if any, shall be payable in respect of any Securities
of such series, the Interest Payment Dates on which such interest shall be
payable, the right, pursuant to Section 311 or as otherwise set forth
therein, of the Company to defer or extend an Interest Payment Date, and
the Regular Record Date for the interest payable on any Interest Payment
Date or the method by which any of the foregoing shall be determined;
(e) the place or places where the principal of (and premium, if any)
and interest on the Securities of such series shall be payable, the place
or places where the Securities of such series may be presented for
registration of transfer or exchange, and the place or places where notices
and demands to or upon the Company in respect of the Securities of such
series may be made;
(f) the period or periods within or the date or dates on which, if
any, 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;
(g) the obligation or the right, if any, of the Company to redeem,
repay or purchase the Securities of such series pursuant to any sinking
fund, amortization or analogous provisions, or at the option of a Holder
thereof, and the period or periods within which, the price or prices at
which, the currency or currencies (including currency unit or units) in
which and the other terms and conditions upon which Securities of the
series shall be redeemed, repaid or purchased, in whole or in part,
pursuant to such obligation;
(h) the denominations in which any Securities of such series shall be
issuable, if other than denominations of $25 and any integral multiple
thereof;
(i) if other than Dollars, the currency or currencies (including
currency unit or units) in which the principal of (and premium, if any) and
interest, if any, on the Securities of the series shall be payable, or in
which the Securities of the series shall be denominated;
(j) the additions, modifications or deletions, if any, in the Events
of Default or covenants of the Company set forth herein with respect to the
Securities of such series;
(k) if other than the principal amount thereof, the portion of the
principal amount of Securities of such series that shall be payable upon
declaration of acceleration of the Maturity thereof;
(l) the additions or changes, if any, to this Indenture with respect
to the Securities of such series as shall be necessary to permit or
facilitate the issuance of the Securities of such
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<PAGE>
series in bearer form, registrable or not registrable as to principal, and
with or without interest coupons;
(m) any index or indices used to determine the amount of payments of
principal of and premium, if any, on the Securities of such series or the
manner in which such amounts will be determined;
(n) the issuance of a temporary Global Security representing all of
the Securities of such series and exchange of such temporary Global
Security for definitive Securities of such series;
(o) whether the Securities of the series shall be issued in whole or
in part in the form of one or more Global Securities and, in such case, the
Depositary for such Global Securities, which Depositary shall be a clearing
agency registered under the Securities Exchange Act of 1934, as amended;
(p) the appointment of any Paying Agent or Agents for the Securities
of such series;
(q) the terms of any right to convert or exchange Securities of such
series into any other securities or property of the Company, and the
additions or changes, if any, to this Indenture with respect to the
Securities of such series to permit or facilitate such conversion or
exchange;
(r) the form or forms of the Trust Agreement, Amended and Restated
Trust Agreement and Guarantee Agreement, if different from the forms
attached hereto as Annexes A, B and C, respectively;
(s) the relative degree, if any, to which the Securities of the
series shall be senior to or be subordinated to other series of Securities
in right of payment, whether such other series of Securities are
Outstanding or not; and
(t) any other terms of the Securities of such series (which terms
shall not be inconsistent with the provisions of this Indenture).
All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided herein or in
or pursuant to such Board Resolution and set forth in such Officers' Certificate
or in any such indenture supplemental hereto.
If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such action
shall be certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
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<PAGE>
SECTION 302. DENOMINATIONS. The Securities of each series shall be
in registered form without coupons and shall be issuable in denominations of $25
and any integral multiple thereof, unless otherwise specified as contemplated by
Section 301.
SECTION 303. EXECUTION, AUTHENTICATION, DELIVERY AND DATING. The
Securities shall be executed on behalf of the Company by its President or one of
its Vice Presidents under its corporate seal reproduced or impressed thereon and
attested by its Secretary or one of its Assistant Secretaries. The signature of
any of these officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices at the date of such Securities. At any time and from time to time after
the execution and delivery of this Indenture, the Company may deliver Securities
executed by the Company to the Trustee for authentication. Securities may be
authenticated on original issuance from time to time and delivered pursuant to
such procedures acceptable to the Trustee ("Procedures") as may be specified
from time to time by Company Order. Procedures may authorize authentication and
delivery pursuant to oral instructions of the Company or a duly authorized
agent, which instructions shall be promptly confirmed in writing.
Prior to the delivery of a Security in any such form to the Trustee
for authentication, the Company shall deliver to the Trustee the following:
(a) A Company Order requesting the Trustee's authentication and
delivery of all or a portion of the Securities of such series, and if less
than all, setting forth procedures for such authentication;
(b) The Board Resolution by or pursuant to which such form of
Security has been approved, and the Board Resolution, if any, by or
pursuant to which the terms of the Securities of such series have been
approved, and, if pursuant to a Board Resolution, an Officers' Certificate
describing the action taken;
(c) An Officers' Certificate dated the date such certificate is
delivered to the Trustee, stating that all conditions precedent provided
for in this Indenture relating to the authentication and delivery of
Securities in such form and with such terms have been complied with; and
(d) An Opinion of Counsel stating that (i) the form of such
Securities has been duly authorized and approved in conformity with the
provisions of this Indenture; (ii) the terms of such Securities have been
duly authorized and determined in conformity with the provisions of this
Indenture, or, if such terms are to be determined pursuant to Procedures,
as defined above, when so determined such terms shall have been duly
authorized and determined in conformity with the provisions of this
Indenture; and (iii) Securities in such form when completed by appropriate
insertions and executed and delivered by the Company to the Trustee for
authentication in accordance with this Indenture, authenticated and
delivered by the Trustee in accordance with this Indenture within the
authorization as to
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<PAGE>
aggregate principal amount established from time to time by the Board of
Directors and sold in the manner specified in such Opinion of Counsel, will
be the legal, valid and binding obligations of the Company entitled to the
benefits of this Indenture, subject to applicable bankruptcy,
reorganization, insolvency and similar laws generally affecting creditors'
rights, to general equitable principles and except as enforcement thereof
may be limited by (A) requirements that a claim with respect to any
Securities denominated other than in Dollars (or a Foreign Currency or
currency unit judgment in respect of such claim) be converted into Dollars
at a rate of exchange prevailing on a date determined pursuant to
applicable law or (B) governmental authority to limit, delay or prohibit
the making of payments in Foreign Currencies or currency units or payments
outside the United States, and subject to such other qualifications as such
counsel shall conclude do not materially affect the rights of Holders of
such Securities;
provided, however, that the Trustee shall be entitled to receive the documents
referred to in Clauses (b), (c) and (d) above only at or prior to the first
request of the Company to the Trustee to authenticate Securities of such series.
Each Security shall be dated the date of its authentication.
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 by the manual signature of one of its authorized
officers, and such certificate upon any Security shall be conclusive evidence,
and the only evidence, that such Security has been duly authenticated and
delivered hereunder.
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
denomination, substantially of the tenor of the definitive Securities of such
series in lieu of which they are issued and 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.
If temporary Securities of any series are issued, the Company will
cause definitive Securities of such series to be prepared without unreasonable
delay. After the preparation of definitive Securities, the temporary Securities
shall be exchangeable for definitive Securities upon surrender of the temporary
Securities at the office or agency of the Company designated for that purpose
without charge to the Holder. Upon surrender for cancellation of any one or
more temporary Securities, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Securities of the same series of authorized denominations having the
same Original Issue Date and Stated Maturity and having the same terms as such
temporary Securities. Until so exchanged, the temporary Securities shall in all
respects be entitled to the same benefits under this Indenture as definitive
Securities.
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<PAGE>
SECTION 305. REGISTRATION, TRANSFER AND EXCHANGE. The Company shall
cause to be kept at the Corporate Trust Office of the Trustee a register in
which, subject to such reasonable regulations as it may prescribe, the Company
shall provide for the registration of Securities and of transfers of Securities.
Such register is herein sometimes referred to as the "Securities Register." The
Trustee is hereby appointed "Securities Registrar" for the purpose of
registering Securities and transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security at the
office or agency of the Company designated for that purpose 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 any authorized denominations, of a like aggregate principal amount, of
the same Original Issue Date and Stated Maturity and having the same terms.
At the option of the Holder, Securities may be exchanged for other
Securities of the same series of any authorized denominations, of a like
aggregate principal amount, of the same Original Issue Date and Stated Maturity
and having the same terms, upon surrender of the Securities to be exchanged at
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 issued upon any transfer or exchange of Securities
shall be the valid obligations of the Company, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Securities
surrendered upon such transfer or exchange.
Every Security presented or surrendered for transfer or exchange shall
(if so required by the Company or the Securities Registrar) be duly endorsed, or
be accompanied by a written instrument of transfer in form satisfactory to the
Company and the Securities Registrar, duly executed by the Holder thereof or his
attorney duly authorized in writing.
No service charge shall be made to a Holder for any 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 transfer or exchange of Securities.
Notwithstanding any of the foregoing, any Global Security of a series
shall be exchangeable pursuant to this Section 305 for Securities registered in
the names of Persons other than the Depositary for such Security or its nominee
only if (i) such Depositary notifies the Company that it is unwilling or unable
to continue as Depositary for such Global Security or if at any time such
Depositary ceases to be a clearing agency registered under the Securities
Exchange Act of 1934, as amended, (ii) the Company executes and delivers to the
Trustee a Company Order that such Global Security shall be so exchangeable or
(iii) there shall have occurred and be continuing an Event of Default with
respect to the Securities of such series. Any Global Security that is
exchangeable pursuant to the preceding sentence shall be exchangeable for
Securities registered in such names as such Depositary shall direct.
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<PAGE>
Notwithstanding any other provision in this Indenture, a Global
Security may not be transferred except as a whole by the Depositary with respect
to such Global Security to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary.
Neither the Company nor the Trustee shall be required, pursuant to the
provisions of this Section, (a) to issue, transfer or exchange any Security of
any series during a period beginning at the opening of business 15 days before
the day of selection for redemption of Securities pursuant to Article XI and
ending at the close of business on the day of mailing of notice of redemption or
(b) to transfer or exchange any Security so selected for redemption in whole or
in part, except, in the case of any Security to be redeemed in part, any portion
thereof not to be redeemed.
SECTION 306. MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES. If
any mutilated Security is surrendered to the Trustee together with such security
or indemnity as may be required by the Company or the Trustee to save each of
them harmless, the Company shall execute and the Trustee shall authenticate and
deliver in exchange therefor a new Security of the same issue and series of like
tenor and principal amount, having the same Original Issue Date and Stated
Maturity and bearing the same Interest Rate as such mutilated Security, and
bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and to the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any
Security, and (ii) such security or indemnity as may be required by them to save
each of them harmless, then, in the absence of notice to the Company or the
Trustee that such Security has been acquired by a bona fide purchaser, the
Company shall execute and upon its request the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of the same issue and series of like tenor and principal amount, having the same
Original Issue Date and Stated Maturity and bearing the same Interest Rate as
such destroyed, lost or stolen Security, and bearing a number not
contemporaneously outstanding.
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
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security 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, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities duly issued hereunder.
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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.
Interest on any Security of any series 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
in respect of Securities of such series, except that, unless otherwise provided
in the Securities of such series, interest payable on the Stated Maturity of a
Security shall be paid to the Person to whom principal is paid. The initial
payment of interest on any Security of any series which is issued between a
Regular Record Date and the related Interest Payment Date shall be payable as
provided in such Security or in the Board Resolution pursuant to Section 301
with respect to the related series of Securities.
Any interest on any Security which is payable, but is not timely paid
or duly provided for, on any Interest Payment Date for Securities of such series
(herein called "Defaulted Interest"), shall forthwith cease to be payable to the
registered Holder on the relevant Regular Record Date by virtue of having been
such Holder, and such Defaulted Interest may be paid by the Company, at its
election in each case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Securities of such series in respect of
which interest is in default (or their respective Predecessor Securities)
are registered at the close of business on a Special Record Date for the
payment of such Defaulted Interest, which shall be fixed in the following
manner. The Company shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Security and the date of the
proposed payment, and at the same time the Company shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be
paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this
Clause provided. Thereupon the Trustee shall fix a Special Record Date for
the payment of such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Company of such
Special Record Date and, in the name and at the expense of the Company,
shall cause notice of the proposed payment of such Defaulted Interest and
the Special Record Date therefor to be mailed, first class, postage
prepaid, to each Holder of a Security of such series at the address of such
Holder as it appears in the Securities Register not less than 10 days prior
to such Special Record Date. The Trustee may, in its discretion, in the
name and at the expense of the Company, cause a similar notice to be
published at least once in a newspaper, customarily published in the
English language on each Business Day and of general circulation in the
Borough of Manhattan, The City of New York, but such publication shall not
be a condition precedent to the establishment of such Special Record Date.
Notice of the proposed payment of such Defaulted Interest and the Special
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Record Date therefor having been mailed as aforesaid, such Defaulted
Interest shall be paid to the Persons in whose names the Securities of such
series (or their respective Predecessor Securities) are registered on such
Special Record Date and shall no longer be payable pursuant to the
following Clause (2).
(2) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any
securities exchange, the Nasdaq National Market or other applicable
interdealer quotation system or self-regulatory organization on which the
Securities of the series in respect of which interest is in default may be
listed or traded and, upon such notice as may be required by such exchange
or other self-regulatory organization (or by the Trustee if the Securities
are not listed or traded), if, after notice given by the Company to the
Trustee of the proposed payment pursuant to this Clause, such payment shall
be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon 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. The Company, the Trustee and any
agent of the Company or the Trustee may treat the Person in whose name any
Security is registered as the owner of such Security for the purpose of
receiving payment of principal of and (subject to Section 307) interest 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. All Securities surrendered for payment,
redemption, transfer or exchange shall, if surrendered to any Person other than
the Trustee, be delivered to the Trustee, and any such Securities and Securities
surrendered directly to the Trustee for any such purpose shall be promptly
canceled by it. The Company may at any time deliver to the Trustee for
cancellation any Securities previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and all Securities
so delivered shall be promptly canceled by the Trustee. 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 shall be destroyed by the Trustee and the Trustee shall deliver to
the Company a certificate of such destruction.
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 for any period shall be computed on the basis of a
360-day year of twelve 30-day months and interest on the Securities of each
series for any partial period shall be computed on the basis of the number of
days elapsed in a 360-day year of twelve 30-day months.
SECTION 311. DEFERRALS OF INTEREST PAYMENT DATES. If specified as
contemplated by Section 301 with respect to the Securities of a particular
series, the Company shall have the right, at any time during the term of such
series, from time to time to defer the payment of interest on such
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Securities for such period or periods as may be specified as contemplated by
Section 301 (each, an "Extension Period"), during which Extension Periods the
Company shall have the right to make partial payments of interest on any
Interest Payment Date. No Extension Period shall end on a date other than an
Interest Payment Date. At the end of any such Extension Period the Company
shall pay all interest then accrued and unpaid on the Securities (together with
Additional Interest thereon, if any, at the rate specified for the Securities of
such series to the extent permitted by applicable law), provided, however, that
during any such Extension Period, the Company shall not, and shall cause any
Subsidiary not to, (i) declare or pay any dividends or distributions on, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of
the Company's capital stock, or (ii) make any payment of principal, interest or
premium, if any, on or repay, repurchase or redeem any debt securities that rank
pari passu with or junior in interest to the Securities of such series or make
any guarantee payments with respect to the foregoing (other than (a) dividends
or distributions in Common Stock of the Company, (b) redemptions or purchases of
any rights pursuant to the Company's Preferred Stock Purchase Rights Plan, or
any successor to such Preferred Stock Purchase Rights Plan, and the declaration
of a dividend of such rights or the issuance of Preferred Stock under such plans
in the future, (c) payments under any Nevada Power Guarantee, (d) purchases of
Common Stock related to the issuance of Common Stock under any of the Company's
benefit plans for its directors, officers or employees and (e) purchases of
Common Stock required to prevent the loss or secure the renewal or reinstatement
of any government license or franchise held by the Company or any of its
Subsidiaries). Prior to the termination of any such Extension Period, the
Company may further extend the interest payment period, provided that no
Extension Period shall exceed the period or periods specified in such Securities
or extend beyond the Maturity of such Securities. Upon termination of any
Extension Period and upon the payment of all accrued and unpaid interest and any
Additional Interest then due on any Interest Payment Date, the Company may elect
to begin 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 shall give the Holders of the Securities of such series and the
Trustee notice of its election to begin any such Extension Period at least one
Business Day prior to the Interest Payment Date or, with respect to the
Securities of a series issued to an NVP Trust, prior to the earlier of (I) the
date the Distributions on the Preferred Securities of such NVP Trust are payable
or (ii) the date the Administrative Trustees of such NVP Trust are required to
give notice to any securities exchange, the Nasdaq National Market or other
applicable interdealer quotation system or self-regulatory organization or to
holders of such Preferred Securities of the record date or the date such
Distributions are payable, but in any event not less than one Business Day prior
to such record date.
The Trustee shall promptly give notice of the Company's election to
begin any such Extension Period to the Holders of the outstanding Securities of
such series.
SECTION 312. RIGHT OF SET-OFF. With respect to the Securities of a
series issued to an NVP Trust, notwithstanding anything to the contrary in the
Indenture, the Company shall have the right to set-off any payment it is
otherwise required to make thereunder in respect of any such Security to the
extent the Company has theretofore made, or is concurrently on the date of such
payment making, a payment under the Nevada Power Guarantee relating to such
Security.
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SECTION 313. AGREED TAX TREATMENT. Each Security issued hereunder
shall provide that the Company and, by its acceptance of a Security or a
beneficial interest therein, the Holder of, and any Person that acquires a
beneficial interest in, such Security agree that for United States federal,
state and local tax purposes it is intended that such Security constitute
indebtedness.
SECTION 314. EXTENSION OF STATED MATURITY; ADJUSTMENT OF STATED
MATURITY UPON AN EXCHANGE. If specified as contemplated by Section 301 with
respect to the Securities of a particular series, the Company shall have the
right to (a) change the Maturity Date of the Securities of such series upon the
liquidation of an NVP Trust and the exchange of such Securities for the
Preferred Securities of such NVP Trust and (b) extend the Stated Maturity for
the Securities of such series; provided, that at time any election to extend the
Maturity Date is made and at the time of such extension (i) the Company is not
in bankruptcy, otherwise insolvent or in liquidation, (ii) the Company is not in
default in the payment of any interest or principal on the Securities of such
series and no deferred interest payments thereon have accrued, (iii) the
applicable NVP Trust is not in arrears on payments of Distributions on its
Preferred Securities and no deferred Distributions thereon are accumulated, (iv)
the Securities are rated not less than BBB- by Standard & Poor's Ratings
Services or Baa3 by Moody's Investors Service, Inc. or the equivalent by any
other nationally recognized statistical rating organization and (v) the extended
Stated Maturity is no later than the 49th anniversary of the initial issuance of
the Preferred Securities of the applicable NVP Trust; and provided, further,
that, if the Company exercises its right to liquidate an NVP Trust and exchange
the Securities of such series for the Preferred Securities of such NVP Trust as
specified in clause (a) above, any changed Stated Maturity of the Securities of
such series shall be (A) no earlier than the date five years after the initial
issuance of the Preferred Securities of the applicable NVP Trust and (B) no
later than the date 30 years (plus an extended term of up to an additional 19
years if the above-referenced conditions are satisfied) after the date of the
initial issuance of the Preferred Securities of the applicable NVP Trust.
SECTION 315. CUSIP NUMBERS. The Company in issuing the Securities
may use "CUSIP" numbers (if then generally in use), and, if so, the Trustee
shall use "CUSIP" numbers in notices of redemption as a convenience to Holders;
provided that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Securities or as contained
in any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Securities, and any such redemption shall
not be affected by any defect in or omission of such numbers.
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 401. SATISFACTION AND DISCHARGE OF INDENTURE. This Indenture
shall cease to be of further effect (except as to (i) any surviving rights of
transfer, substitution and exchange of Securities, (ii) rights hereunder of
Holders to receive payments of principal of (and premium, if any) and interest
on the Securities and other rights, duties and obligations of the Holders as
beneficiaries hereof with respect to the amounts, if any, deposited with the
Trustee pursuant to this Article IV and (iii) the rights and obligations of the
Trustee hereunder), and the Trustee, on demand of and at the
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expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered
(other than (i) Securities which have been destroyed, lost or stolen
and which have been replaced or paid as provided in Section 306 and
(ii) Securities for whose payment money has theretofore been deposited
in trust or segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust, as provided in
Section 1003) have been delivered to the Trustee for cancellation; or
(B) all such Securities not theretofore delivered to the Trustee
for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity
within one year of the date of deposit,
and the Company, in the case of clause (i) or (ii) above, has
deposited or caused to be deposited with the Trustee as trust
funds in trust for such purpose an amount in the currency or
currencies in which the Securities of such series are payable
sufficient to pay and discharge the entire indebtedness on such
Securities not theretofore delivered to the Trustee for
cancellation, for principal (and premium, if any) and interest
(including any Additional Interest) to the date of such deposit
(in the case of Securities which have become due and payable) or
to the Stated Maturity;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture
have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
SECTION 402. APPLICATION OF TRUST MONEY. Subject to the provisions
of the last paragraph of Section 1003, all money deposited with the Trustee
pursuant to Section 401 or money or Government Obligations deposited with the
Trustee pursuant to Section 403, or received by the Trustee in respect of
Government Obligations deposited with the Trustee pursuant to Section 403,
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shall be held in trust and applied by the Trustee, in accordance with the
provisions of the Securities and this Indenture, to the payment, either directly
or through any Paying Agent (including the Company acting as its own Paying
Agent) as the Trustee may determine, to the Persons entitled thereto, of the
principal (and premium, if any) and interest for the payment of which such money
or obligations have been deposited with or received by the Trustee; provided,
however, such moneys need not be segregated from other funds except to the
extent required by law.
SECTION 403. SATISFACTION, DISCHARGE AND DEFEASANCE OF SECURITIES OF
ANY SERIES. Unless otherwise provided in the Board Resolution adopted pursuant
to Section 301 establishing the terms of the Securities of any series, the
Company shall be deemed to have paid and discharged the entire indebtedness on
all the Outstanding Securities of any such series and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of such indebtedness, when
(1) with respect to all Outstanding Securities of such series,
(A) the Company has irrevocably deposited or caused to be
irrevocably deposited with the Trustee as trust funds in trust for
such purpose an amount sufficient to pay and discharge the entire
indebtedness on all Outstanding Securities of such series for
principal (and premium, if any) and interest (including any Additional
Interest) to the Stated Maturity or any Redemption Date as
contemplated by the penultimate paragraph of this Section 403, as the
case may be; or
(B) the Company has irrevocably deposited or caused to be
irrevocably deposited with the Trustee as obligations in trust for
such purpose an amount of Government Obligations as will, in the
written opinion of independent public accountants delivered to the
Trustee, together with predetermined and certain income to accrue
thereon, without consideration of any reinvestment thereof, be
sufficient to pay and discharge when due the entire indebtedness on
all Outstanding Securities of such series for principal (and premium,
if any) and interest (including any Additional Interest) to the Stated
Maturity or any Redemption Date as contemplated by the penultimate
paragraph of this Section 403, as the case may be; and
(2) the Company has paid or caused to be paid all other sums payable
with respect to the Outstanding Securities of such series; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of the
entire indebtedness on all Outstanding Securities of any such series have
been complied with.
Any deposits with the Trustee referred to in Section 403(1) above
shall be irrevocable and shall be made under the terms of an escrow trust
agreement in form and substance reasonably satisfactory to the Trustee. If any
Outstanding Securities of such series are to be redeemed prior to their Stated
Maturity, whether pursuant to any optional redemption provisions or in
accordance with
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any mandatory sinking fund requirement, the applicable escrow trust agreement
shall provide therefor and the Company shall make such arrangements as are
satisfactory to the Trustee for the giving of notice of redemption by the
Trustee in the name, and at the expense, of the Company. If the Securities of
such series are not to become due and payable at their Stated Maturity or upon
call for redemption within one year of the date of deposit, then the Company
shall give, not later than the date of such deposit, notice of such deposit to
the Holders of Securities of such series.
Upon the satisfaction of the conditions set forth in this Section 403
with respect to all the Outstanding Securities of any series, the terms and
conditions of such series, including the terms and conditions with respect
thereto set forth in this Indenture, shall no longer be binding upon, or
applicable to, the Company; provided, that the Company shall not be discharged
from any payment obligations in respect of Securities of such series which are
deemed not to be Outstanding under clause (iii) of the definition thereof if
such obligations continue to be valid obligations of the Company under
applicable law.
ARTICLE V
REMEDIES
SECTION 501. EVENTS OF DEFAULT. "Event of Default", wherever used
herein with respect to the Securities of any series, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
(1) default in the payment of any interest upon any Security of that
series, including any Additional Interest in respect thereof, when it
becomes due and payable, and continuance of such default for a period of 30
days (subject to the deferral of any due date in the case of an Extension
Period); or
(2) default in the payment of the principal of (or premium, if any,
on) any Security of that series at its Maturity; or
(3) default in the performance, or breach, in any material respect,
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 the breach of
which is elsewhere in this Section specifically dealt with), and
continuance of such default or breach for a period of 90 days after there
has been given, by registered or certified mail, to the Company by the
Trustee or to the Company and the Trustee by the Holders of at least 25% in
principal amount of the Outstanding Securities of that series a written
notice specifying such default or breach and requiring it to be remedied;
or
(4) the entry of a decree or order by a court having jurisdiction in
the premises adjudging the Company a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjustment
or composition of or in respect of the
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Company under any applicable federal or state bankruptcy, insolvency,
reorganization or other similar law, or appointing a receiver, liquidator,
assignee, trustee, sequestrator (or other similar official) of the Company
or of any substantial part of its property or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree or order
unstayed and in effect for a period of 60 consecutive days; or
(5) the institution by the Company of proceedings to be adjudicated a
bankrupt or insolvent, or 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 any
applicable federal or state bankruptcy, insolvency, reorganization or other
similar law, or the consent by it to the filing of any such petition or to
the appointment of a receiver, liquidator, assignee, trustee, sequestrator
(or other similar official) of the Company or of any substantial part of
its property, or the making by it of an assignment for the benefit of
creditors, or the admission by it in writing of its inability to pay its
debts generally as they become due and its willingness to be adjudicated a
bankrupt, or the taking of corporate action by the Company in furtherance
of any such action; or
(6) any other Event of Default with respect to Securities of that
series.
SECTION 502. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT. If
an Event of Default with respect to Securities of any series at the time
Outstanding occurs and is continuing, then and in every such case the Trustee or
the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series may declare the principal amount (or, if the
Securities of that series are Discount Securities, such portion of the principal
amount as may be specified in the terms of that series) of all the Securities of
that series to be due and payable immediately, by a notice in writing to the
Company (and to the Trustee if given by Holders), provided that, in the case of
the Securities of a series issued to an NVP Trust, if, upon an Event of Default,
the Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series fail to declare the principal of all the
Securities of that series to be immediately due and payable, the holders of at
least 25% in aggregate liquidation amount of the corresponding series of
Preferred Securities then outstanding shall have such right by a notice in
writing to the Company and the Trustee; and upon any such declaration such
principal amount (or specified amount) of and the accrued interest (including
any Additional Interest) on all the Securities of such series shall become
immediately due and payable, provided that the payment of principal and interest
(including any Additional Interest) on such Securities shall remain subordinated
to the extent provided in Article Thirteen.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in principal amount of the
Outstanding Securities of that series, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences if:
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
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(A) all overdue installments of interest (including any
Additional Interest) on all Securities of that series,
(B) the principal of (and premium, if any, on) any Securities of
that series which have become due otherwise than by such declaration
of acceleration and interest thereon at the rate borne by the
Securities, and
(C) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel; and
(2) all Events of Default with respect to Securities of that series,
other than the non-payment of the principal of Securities of that series
which has become due solely by such acceleration, have been cured or waived
as provided in Section 513.
The holders of a majority in aggregate outstanding principal amount of
the Securities of a series affected thereby may, on behalf of the holders of all
the Securities of such series, waive any past default, except a default in the
payment of principal or interest (unless such default has been cured and a sum
sufficient to pay all matured installments of interest and principal due
otherwise than by acceleration has been deposited with the Trustee) or a default
in respect of a covenant or provision which under this Indenture cannot be
modified or amended without the consent of the holder of each outstanding
Security of such series and, in the case of Securities of a series issued to an
NVP Trust, should the holders of such Securities fail to annul such declaration
and waive such default, the holders of a majority in aggregate liquidation
preference of the related series of Preferred Securities shall have such right.
No such rescission shall affect any subsequent default or impair any
right consequent thereon.
Upon receipt by the Trustee of written notice declaring such an
acceleration, or rescission and annulment thereof, with respect to Securities of
a series all or part of which is represented by a Global Security, a record date
shall be established for determining Holders of Outstanding Securities of such
series entitled to join in such notice, which record date shall be at the close
of business on the day the Trustee receives such notice. The Holders on such
record date, or their duly designated proxies, and only such Persons, shall be
entitled to join in such notice, whether or not such Holders remain Holders
after such record date; provided, that, unless such declaration of acceleration,
or rescission and annulment, as the case may be, shall have become effective by
virtue of the requisite percentage having joined in such notice prior to the day
which is 90 days after such record date, such notice of declaration of
acceleration, or rescission and annulment, as the case may be, shall
automatically and without further action by any Holder be canceled and of no
further effect. Nothing in this paragraph shall prevent a Holder, or a proxy of
a Holder, from giving, after expiration of such 90-day period, a new written
notice of declaration of acceleration, or rescission and annulment thereof, as
the case may be, that is identical to a written notice which has been canceled
pursuant to the proviso to the preceding sentence, in which event a new record
date shall be established pursuant to the provisions of this Section 502.
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SECTION 503. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE. The Company covenants that if:
(1) default is made in the payment of any installment of interest
(including any Additional Interest) on any Security when such interest
becomes due and payable and such default continues for a period of 30 days,
or
(2) default is made in the payment of the principal of (and premium,
if any, on) any Security at the Maturity thereof, the Company will, upon
demand of the Trustee, pay to the Trustee, for the benefit of the Holders
of such Securities, the whole amount then due and payable on such
Securities for principal, including any sinking fund payment or analogous
obligations (and premium, if any) and interest (including any Additional
Interest); and, in addition thereto, all amounts owing the Trustee under
Section 607.
If the Company fails 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, and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company or any other obligor upon the 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 the Securities, wherever
situated.
If an Event of Default with respect to Securities of any series occurs
and is 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 504. 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,
(a) the Trustee (irrespective of whether the principal of the
Securities of any series 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 (and premium, if any) or interest (including any
Additional Interest)) shall be entitled and empowered, by intervention
in such proceeding or otherwise,
(i) to file and prove a claim for the whole amount of
principal (and premium, if any) and interest (including any
Additional Interest) owing and unpaid in respect to the
Securities and to file such other papers or documents as may be
necessary or advisable and to take any and all actions as are
authorized under the Trust Indenture Act in order to have the
claims of the
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Holders and any predecessor to the Trustee under Section 607 and
of the Holders allowed in any such judicial proceedings; and
(ii) and in particular, the Trustee shall be authorized
to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same in
accordance with Section 506; and
(b) 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 for
distribution in accordance with Section 506, and in the event that the
Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due to it and any predecessor
Trustee under Section 607.
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; provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors' or
other similar committee.
SECTION 505. TRUSTEE MAY ENFORCE CLAIM 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 all the amounts owing the Trustee and any
predecessor Trustee under Section 607, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.
SECTION 506. APPLICATION OF MONEY COLLECTED. Any money or property
collected or to be applied by the Trustee with respect to a series of Securities
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 or
property on account of principal (or premium, if any) or interest (including any
Additional Interest), upon presentation of the Securities and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid:
FIRST: To the payment of all amounts due the Trustee and any
predecessor Trustee under Section 607;
SECOND: To the payment of the amounts then due and unpaid upon such
series of Securities for principal (and premium, if any) and interest (including
any Additional Interest), 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 series of Securities for
principal (and premium, if any) and interest (including any Additional
Interest), respectively; and
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THIRD: The balance, if any, to the Person or Persons entitled
thereto.
SECTION 507. LIMITATION ON SUITS. No Holder of any Securities of any
series shall have any right to institute any proceeding, judicial or otherwise,
with respect to this Indenture or for the appointment of a receiver, assignee,
trustee, liquidator, sequestrator (or other similar official) or for any other
remedy hereunder, unless:
(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to the Securities of that
series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series shall have made written request to
the Trustee to institute proceedings in respect of such Event of Default in
its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Holders of a majority
in principal amount of the Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing itself of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders of Securities, 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 such Holders.
SECTION 508. 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) interest (including any Additional Interest) on such
Security on the respective Stated Maturities expressed in such Security and to
institute suit for the enforcement of any such payment, and such right shall not
be impaired without the consent of such Holder. In the case of Securities of a
series issued to an NVP Trust, any holder of the corresponding series of
Preferred Securities shall have the right set forth in the preceding sentence to
directly institute a proceeding for enforcement of payment of the principal of
(and premium, if any) and (subject to Section 307) interest (including any
Additional Interest) on any Security to such holder of the principal amount of
or interest on the Securities having a principal amount equal to the aggregate
liquidation preference of the corresponding series of Preferred Securities of
such Holder.
SECTION 509. 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
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proceeding has been discontinued or abandoned for any reason, or has been
determined adversely to the Trustee or to such Holder, then and in every such
case the Company, the Trustee and the Holders shall, subject to any
determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of the
Trustee and the Holders shall continue as though no such proceeding had been
instituted.
SECTION 510. 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 511. DELAY OR OMISSION NOT WAIVER. Except as otherwise
provided in the last paragraph of Section 306, no delay or omission of the
Trustee or of any Holder of any Security 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 512. CONTROL BY HOLDERS. The Holders of a majority in
principal amount of the Outstanding Securities of any series shall have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee or exercising any trust or power conferred on
the Trustee, with respect to the Securities of such series, provided that:
(1) such direction shall not be in conflict with any rule of law or
with this Indenture,
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction, and
(3) subject to the provisions of Section 601, the Trustee shall have
the right to decline to follow such direction if the Trustee in good faith
shall, by a Responsible Officer or Officers of the Trustee, determine that
the proceeding so directed would be unjustly prejudicial to the Holders not
joining in any such direction or would involve the Trustee in personal
liability.
Upon receipt by the Trustee of any written notice directing the time,
method or place of conducting any such proceeding or exercising any such trust
or power, with respect to Securities of a series all or part of which is
represented by a Global Security, a record date shall be established for
determining Holders of Outstanding Securities of such series entitled to join in
such notice, which record date shall be at the close of business on the day the
Trustee receives such notice. The Holders
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on such record date, or their duly designated proxies, and only such Persons,
shall be entitled to join in such notice, whether or not such Holders remain
Holders after such record date; provided, that, unless the Holders of a majority
in principal amount of the Outstanding Securities of such series shall have
joined in such notice prior to the day which is 90 days after such record date,
such notice shall automatically and without further action by any Holder be
canceled and of no further effect. Nothing in this paragraph shall prevent a
Holder, or a proxy of a Holder, from giving, after expiration of such 90-day
period, a new notice identical to a notice which has been canceled pursuant to
the proviso to the preceding sentence, in which event a new record date shall be
established pursuant to the provisions of this Section 512.
SECTION 513. 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 and its consequences with respect to such series, except a
default:
(1) in the payment of the principal of (or premium, if any) or
interest (including any Additional Interest) on any Security of such
series, or
(2) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of
each Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
SECTION 514. UNDERTAKING FOR COSTS. All parties to this Indenture
agree, and each Holder of any Security 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 or omitted by it as Trustee, the filing
by any party litigant in such suit of an undertaking to pay the costs of such
suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such party litigant; but the provisions of this Section shall not apply to any
suit instituted by the Trustee, to any suit instituted by any Holder, or group
of Holders, holding in the aggregate more than 10% in principal amount of the
Outstanding Securities of any series, or to any suit instituted by any Holder
for the enforcement of the payment of the principal of (or premium, if any) or
interest (including any Additional Interest) on any Security on or after the
respective Stated Maturities expressed in such Security.
SECTION 515. WAIVER OF USURY, STAY OR EXTENSION LAWS. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any usury, stay or extension law wherever enacted, now
or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby
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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 VI
THE TRUSTEE
SECTION 601. CERTAIN DUTIES AND RESPONSIBILITIES. (a) Except during
the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture, and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture; but in the case of any such certificates or
opinions which by any provisions hereof are specifically required to
be furnished to the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they conform to the
requirements of this Indenture.
(b) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as
a prudent person would exercise or use under the circumstances in the
conduct of his own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct except that
(1) this Subsection shall not be construed to limit the effect
of Subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved
that the Trustee was negligent in ascertaining the pertinent facts;
and
(3) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with
the direction of Holders pursuant to Section 512 relating to the time,
method and place of conducting any proceeding for any remedy available
to the Trustee, or exercising any trust or power conferred upon the
Trustee, under this Indenture with respect to the Securities of
such series.
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(d) 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 there shall be reasonable
grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to
it.
(e) 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 602. NOTICE OF DEFAULTS. Within 90 days after actual
knowledge by a Responsible Officer of the Trustee of the occurrence of any
default hereunder with respect to the Securities of any series, the Trustee
shall transmit by mail to all Holders of Securities of such series, as their
names and addresses appear in the Securities Register, notice of such default
hereunder known to the Trustee, unless such default shall have been cured or
waived; provided, however, that, except in the case of a default in the payment
of the principal of (or premium, if any) or interest (including any Additional
Interest) on any Security of such series, the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee or a trust committee of directors and/or Responsible Officers of the
Trustee in good faith determines that the withholding of such notice is in the
interests of the Holders of Securities of such series; and provided, further,
that, in the case of any default of the character specified in Section 501(3),
no such notice to Holders of Securities of such series shall be given until at
least 30 days after the occurrence thereof. For the purpose of this Section, the
term "default" means any event which is, or after notice or lapse of time or
both would become, an Event of Default with respect to Securities of such
series.
SECTION 603. CERTAIN RIGHTS OF TRUSTEE. Subject to the provisions of
Section 601:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, Security or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or
parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors 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 Officers' Certificate;
(d) the Trustee may consult with counsel and the advice of such
counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon;
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(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 of the Holders pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction;
(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, indenture, Security or other paper or document, but the Trustee in
its discretion may make such inquiry or investigation into such facts or
matters as it may see fit, and, if the Trustee shall determine to make such
inquiry or investigation, it shall be entitled to examine the books,
records and premises of the Company, personally or by agent or attorney;
and
(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.
SECTION 604. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of the Company,
and the Trustee assumes no responsibility for their correctness. The Trustee
makes no representations as to the validity or sufficiency of this Indenture or
of the Securities. The Trustee shall not be accountable for the use or
application by the Company of the Securities or the proceeds thereof.
SECTION 605. MAY HOLD SECURITIES. The Trustee, any Paying Agent,
Securities 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 608 and 613, may otherwise deal with the Company with the same rights
it would have if it were not Trustee, Paying Agent, Securities Registrar or such
other agent.
SECTION 606. MONEY HELD IN TRUST. Money held by the Trustee in trust
hereunder need not be segregated from other funds except to the extent required
by law. The Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed with the Company.
SECTION 607. COMPENSATION AND REIMBURSEMENT. The Company agrees
(1) to pay to the Trustee from time to time reasonable compensation
for all services rendered by it hereunder in such amounts as the Company
and the Trustee shall agree from time to time (which compensation shall not
be limited by any provision of law in regard to the compensation of a
trustee of an express trust);
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(2) to reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the reasonable
compensation and the expenses and disbursements of its agents and counsel),
except any such expense, disbursement or advance as may be attributable to
its negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless against,
any loss, liability or expense (including the reasonable compensation and
the expenses and disbursements of its agents and counsel) incurred without
negligence or bad faith, arising out of or in connection with the
acceptance or administration of this trust or the performance of its duties
hereunder, including the costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of
its powers or duties hereunder. This indemnification shall survive the
termination of this Agreement.
To secure the Company's payment obligations in this Section, the
Company and the Holders agree that the Trustee shall have a lien prior to the
Securities on all money or property held or collected by the Trustee. Such lien
shall survive the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 501(4) or (5) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Reform Act of 1978 or a successor statute.
SECTION 608. DISQUALIFICATION; CONFLICTING INTERESTS. The Trustee
for the Securities of any series issued hereunder shall be subject to the
provisions of Section 310(b) of the Trust Indenture Act. Nothing herein shall
prevent the Trustee from filing with the Commission the application referred to
in the second to last paragraph of Section 310(b) of the Trust Indenture Act.
SECTION 609. 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 of America or of any State, Territory or the District of
Columbia, authorized under such laws to exercise corporate trust powers and
subject to supervision or examination by federal, state, territorial or
District of Columbia authority, or
(b) a corporation or other Person organized and doing business under
the laws of a foreign government that is permitted to act as Trustee
pursuant to a rule, regulation or order of the Commission, authorized under
such laws to exercise corporate trust powers, 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,
in either case having a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by federal or state authority. If such
corporation publishes reports of condition at least
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annually, pursuant to law or to the requirements of the aforesaid supervising or
examining authority, then, for the purpose 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. Neither the Company nor any
Person directly or indirectly controlling, controlled by or under common control
with the Company shall serve as Trustee for the Securities of any series issued
hereunder.
SECTION 610. 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 under Section 611.
(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
an instrument of acceptance by a successor Trustee 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.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 608 after
written request therefor by the Company or by any Holder who has been
a bona fide Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and
shall fail to resign after written request therefor by the Company or
by any such Holder, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of
its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company, acting under authority of a
Board Resolution, may remove the Trustee, or (ii) subject to Section
514, any Holder who has been a bona fide Holder of a Security 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 and the appointment of a successor Trustee.
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(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
with respect to the Securities of one or more series, the Company, by a
Board Resolution, shall promptly appoint a successor Trustee with respect
to the Securities of that or those series. 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 successor Trustee so appointed shall, forthwith upon
its acceptance of such appointment, become the successor Trustee with
respect to the Securities of such series and 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 hereinafter provided,
any Holder who has been a bona fide Holder of a Security for at least six
months may, subject to Section 514, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Securities of such
series.
(f) 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 the Holders of Securities of such series as their names
and addresses appear in the Securities 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 611. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR. (a) In case of
the appointment hereunder of a successor Trustee with respect to all Securities,
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 its charges,
execute and deliver an instrument transferring to such successor Trustee all the
rights, powers and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder.
(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
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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 successor
Trustee, such retiring Trustee shall duly assign, transfer and deliver to
such successor Trustee all property and money held by such retiring Trustee
hereunder with respect to the 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 and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all rights, powers and trusts referred
to in paragraph (a) 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 612. 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 of 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, and in case any
Securities shall not have been authenticated, any successor to the Trustee may
authenticate such Securities either in the name of any predecessor Trustee or in
the name of such successor Trustee, and in all cases the certificate of
authentication shall have the full force which it is provided anywhere in the
Securities or in this Indenture that the certificate of the Trustee shall have.
SECTION 613. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY. If
and when the Trustee shall be or become a creditor of the Company (or any other
obligor upon the Securities), the Trustee shall be subject to the provisions of
the Trust Indenture Act regarding the collection of claims against the Company
(or any such other obligor).
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SECTION 614. APPOINTMENT OF AUTHENTICATING AGENT. The Trustee may
appoint an Authenticating Agent or Agents with respect to one or more series of
Securities which shall be authorized to act on behalf of the Trustee to
authenticate Securities of such series issued upon original issue and upon
exchange, registration of transfer or partial redemption thereof, 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. Each
Authenticating Agent shall be acceptable to the Company and shall at all times
be a corporation organized and doing business under the laws of the United
States of America, or of any State, Territory 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 all or substantially all of
the corporate trust business of an Authenticating Agent shall be the successor
Authenticating Agent hereunder, provided such corporation shall be otherwise
eligible under this Section, without the execution or filing of any paper or any
further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give notice of such
appointment in the manner provided in Section 106 to all Holders of Securities
of the series with respect to which such Authenticating Agent will serve. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provision 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, subject to the
provisions of Section 607.
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If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternative
certificate of authentication in the following form:
This is one of the Securities referred to in the within mentioned
Indenture.
_________________________
_________________________
As Trustee
By: ____________________
As Authenticating Agent
By: ____________________
Authorized Officer
ARTICLE VII
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF
HOLDERS. The Company will furnish or cause to be furnished to the Trustee:
(a) semi-annually, not more than 15 days after January 15 and July
15, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Holders as of such January 1 and July 1, and
(b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the
time such list is furnished, excluding from any such list names and
addresses received by the Trustee in its capacity as Securities Registrar.
SECTION 702. PRESERVATION OF INFORMATION, COMMUNICATIONS TO
HOLDERS.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained
in the most recent list furnished to the Trustee as provided in
Section 701 and the names and addresses of Holders received by the
Trustee in its capacity as Securities Registrar. The Trustee may
destroy any list furnished to it as provided in Section 701 upon
receipt of a new list so furnished.
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(b) The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities,
and the corresponding rights and privileges of the Trustee, shall be
as provided in the Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company
nor the Trustee nor any agent of either of them shall be held
accountable by reason of the disclosure of information as to the names
and addresses of the Holders made pursuant to the Trust Indenture Act.
SECTION 703. REPORTS BY TRUSTEE.
(a) The Trustee shall transmit to Holders such reports
concerning the Trustee and its actions under this Indenture as may be
required pursuant to the Trust Indenture Act, at the times and in the
manner provided pursuant thereto.
(b) Reports so required to be transmitted at stated intervals of
not more than 12 months shall be transmitted no later than July 15 in
each calendar year, commencing with the first July 15 after the first
issuance of Securities under this Indenture.
(c) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock
exchange or self-regulatory organization upon which the Securities are
listed or traded and also with the Commission. The Company will notify
the Trustee whenever the Securities are listed or traded on any stock
exchange or self-regulatory organization.
SECTION 704. REPORTS BY COMPANY.
The Company shall file with the Trustee and with the Commission, and
transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided in the Trust Indenture Act; provided that any
such information, documents or reports required to be filed with the Commission
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
shall be filed with the Trustee within 15 days after the same is required to be
filed with the Commission. Notwithstanding that the Company may not be required
to remain subject to the reporting requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Company shall continue to file with the
Commission and provide the Trustee with the annual reports and the information,
documents and other reports which are specified in Sections 13 and 15(d) of the
Securities Exchange Act of 1934. The Company also shall comply with the other
provisions of Trust Indenture Act Section 314(a).
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ARTICLE VIII
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN
TERMS.
The Company shall not consolidate with or merge into any other Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, and no Person shall consolidate with or merge into the
Company or convey, transfer or lease its properties and assets substantially as
an entirety to the Company, unless:
(1) in case the Company shall consolidate with or merge into
another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the Person formed by such
consolidation or into which the Company is merged or the Person which
acquires by conveyance or transfer, or which leases, the properties
and assets of the Company substantially as an entirety shall be a
corporation, partnership or trust, shall be organized and existing
under the laws of the United States of America or any State or the
District of Columbia, and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the
principal of (and premium, if any) and interest (including any
Additional Interest) on all the Securities and the performance of
every covenant of this Indenture on the part of the Company to be
performed or observed;
(2) 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 happened and be
continuing;
(3) in the case of the Securities of a series issued to an NVP
Trust, such consolidation, merger, conveyance, transfer or lease is
permitted under the related Trust Agreement and Nevada Power Guarantee
and does not give rise to any breach or violation of the related Trust
Agreement or Nevada Power Guarantee; and
(4) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Independent Counsel each stating that
such consolidation, merger, conveyance, transfer or lease and any such
supplemental indenture complies with this Article and that all
conditions precedent herein provided for relating to such transaction
have been complied with; and the Trustee, subject to Section 601, may
rely upon such Officers' Certificate and Opinion of Independent
Counsel as conclusive evidence that such transaction complies with
this Section 801.
SECTION 802. SUCCESSOR PERSON SUBSTITUTED.
Upon any consolidation or merger by the Company with or into any other
Person, or any conveyance, transfer or lease by the Company of its properties
and assets substantially as an
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entirety to any Person in accordance with Section 801, the successor Person
formed by such consolidation or into which the Company is merged or to which
such conveyance, transfer or lease is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under this Indenture
with the same effect as if such successor Person had been named as the Company
herein; and in the event of any such conveyance, transfer or lease the Company
shall be discharged from all obligations and covenants under the Indenture and
the Securities and may be dissolved and liquidated.
Such successor Person may cause to be signed, and may issue either in
its own name or in the name of the Company, any or all of the Securities
issuable hereunder which theretofore shall not have been signed by the Company
and delivered to the Trustee; and, upon the order of such successor Person
instead of the Company and subject to all the terms, conditions and limitations
in this Indenture prescribed, the Trustee shall authenticate and shall deliver
any Securities which previously shall have been signed and delivered by the
officers of the Company to the Trustee for authentication pursuant to such
provisions and any Securities which such successor Person thereafter shall cause
to be signed and delivered to the Trustee on its behalf for the purpose pursuant
to such provisions. All the Securities so issued shall in all respects have the
same legal rank and benefit under this Indenture as the Securities theretofore
or thereafter issued in accordance with the terms of this Indenture as though
all of such Securities had been issued at the date of the execution hereof.
In case of any such consolidation, merger, sale, conveyance or lease,
such changes in phraseology and form may be made in the Securities thereafter to
be issued as may be appropriate.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 901. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Company,
and the assumption by any such successor of the covenants of the Company
herein and in the Securities contained; or
(2) to convey, transfer, assign, mortgage or pledge any property
to or with the Trustee or to surrender any right or power herein
conferred upon the Company; or
(3) to establish the form or terms of Securities of any series
as permitted by Sections 201 or 301; or
(4) to add to the covenants of the Company for the benefit of
the Holders
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of all or any series of Securities (and if such covenants are to be for the
benefit of less than all series of Securities, stating that such covenants
are expressly being included solely for the benefit of such series) or to
surrender any right or power herein conferred upon the Company; or
(5) to add any additional Events of Default; or
(6) to change or eliminate any of the provisions of this
Indenture, provided that any such change or elimination shall become
effective only when there is no Security Outstanding of any series
created prior to the execution of such supplemental indenture which is
entitled to the benefit of such provision; or
(7) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture, provided that such action
pursuant to this clause (7) shall not materially adversely affect the
interest of the Holders of Securities of any series or, in the case of
the Securities of a series issued to an NVP Trust and for so long as
any of the corresponding series of Preferred Securities shall remain
outstanding, the holders of such Preferred Securities; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a 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 611(b); or
(9) to comply with the requirements of the Commission in order
to effect or maintain the qualification of this Indenture under the
Trust Indenture Act.
SECTION 902. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution, and the Trustee may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders of Securities of such series under this Indenture; provided, however,
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security affected thereby,
(1) except to the extent permitted by Section 311 or as
otherwise specified as contemplated by Section 301 with respect to the
extension of the interest payment period of the Securities of any
series, change the Stated Maturity of the principal of, or any
instalment of interest (including any Additional Interest) on, any
Security, or
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reduce the principal amount thereof or the rate of interest thereon or
reduce any premium payable upon the redemption thereof, or reduce the
amount of principal of a Discount Security that would be due and payable
upon a declaration of acceleration of the Maturity thereof pursuant to
Section 502, or change the place of payment where, or the coin or currency
in which, any Security or interest thereon is payable, or impair the right
to institute suit for the enforcement of any such payment on or after the
Stated Maturity thereof (or, in the case of redemption, on or after the
date fixed for redemption thereof), or
(2) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of whose Holders is required for
any such supplemental indenture, or the consent of whose Holders is
required for any waiver (of compliance with certain provisions of this
Indenture or certain defaults hereunder and their consequences)
provided for in this Indenture, or
(3) modify any of the provisions of this Section, Section 513 or
Section 1005, except to increase any such percentage or to provide
that certain other provisions of this Indenture cannot be modified or
waived without the consent of the Holder of each Security affected
thereby; or
(4) modify the provisions in Article Thirteen of this Indenture
with respect to the subordination of Outstanding Securities of any
series in a manner adverse to the Holders thereof;
PROVIDED that, in the case of the Securities of a series issued to an NVP Trust,
so long as any of the corresponding series of Preferred Securities remains
outstanding, no such amendment shall be made that adversely affects the holders
of such Preferred Securities, and no termination of this Indenture shall occur,
and no waiver of any Event of Default or compliance with any covenant under this
Indenture shall be effective, without the prior consent of the holders of at
least a majority of the aggregate liquidation preference of such Preferred
Securities then outstanding unless and until the principal (and premium, if any)
of the Securities of such series and all accrued and unpaid interest (including
any Additional Interest) thereon have been paid in full; and PROVIDED, FURTHER
that in the case of the Securities of a series issued to an NVP Trust, so long
as any of the corresponding series of Preferred Securities remains outstanding,
no amendment shall be made to Section 508 under this Indenture without the prior
consent of the holders of each Preferred Security then outstanding unless and
until the principal (and premium, if any) of the Securities of such series and
all accrued and unpaid interest (including any Additional Interest) thereon have
been paid in full.
A supplemental indenture that changes or eliminates any covenant or
other provision of this Indenture that 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.
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It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 903. 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 601) shall be fully protected in relying upon, an
Officers' Certificate and an Opinion of Independent Counsel stating that the
execution of such supplemental indenture is authorized or permitted by this
Indenture, and that all conditions precedent have been complied with. The
Trustee may, but shall not be obligated to, enter into any such supplemental
indenture which affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.
SECTION 904. 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.
SECTION 905. 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 906. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Company, bear a notation in form approved by the Company 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
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.
ARTICLE X
COVENANTS
SECTION 1001. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.
The Company covenants and agrees for the benefit of each series of
securities that it will duly and punctually pay the principal of (and premium,
if any) and interest on the Securities of that series in accordance with the
terms of such Securities and this Indenture.
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SECTION 1002. MAINTENANCE OF OFFICE OR AGENCY.
The Company will maintain in each Place of Payment for any series, an
office or agency where Securities of that series may be presented or surrendered
for payment and an office or agency where Securities may be surrendered for
transfer or exchange and where notices and demands to or upon the Company in
respect of the Securities and this Indenture may be served. The Company
initially appoints the Trustee, acting through its Corporate Trust Office, as
its agent for said purposes. The Company will give prompt written notice to the
Trustee of any change in the location of any such office or agency. If at any
time the Company shall fail to maintain such office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee, and the Company hereby appoints the Trustee as its agent to receive all
such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all of such purposes, and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in each
Place of Payment for Securities of any series for such purposes. The Company
will give prompt written notice to the Trustee of any such designation and any
change in the location of any such office or agency.
SECTION 1003. MONEY FOR SECURITY PAYMENTS TO BE HELD IN TRUST.
If the Company shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of the
principal of (and premium, if any) or interest on any of the Securities of such
series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal (and premium, if any) or interest
so becoming due until such sums shall be paid to such Persons or otherwise
disposed of as herein provided, and will promptly notify the Trustee of its
failure so to act.
Whenever the Company shall have one or more Paying Agents, it will,
prior to 10:00 a.m. New York City time on each due date of the principal of or
interest on any Securities, deposit with a Paying Agent a sum sufficient to pay
the principal (and premium, if any) or interest so becoming due, such sum to be
held in trust for the benefit of the Persons entitled to such principal and
premium (if any) or interest, and (unless such Paying Agent is the Trustee) the
Company will promptly notify the Trustee of its failure so to act.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(1) hold all sums held by it for the payment of the principal of
(and premium, if any) or interest on 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;
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(2) give the Trustee notice of any default by the Company (or
any other obligor upon the Securities) in the making of any payment of
principal (and premium, if any) or interest;
(3) 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
(4) comply with the provisions of the Trust Indenture Act
applicable to it as a Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by the Company or 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 on any Security and remaining unclaimed for two years after
such principal (and premium, if any) or interest has become due and payable
shall (unless otherwise required by mandatory provision of applicable escheat or
abandoned or unclaimed property law) be paid on Company Request to the Company,
or (if then held by the Company) shall (unless otherwise required by mandatory
provision of applicable escheat or abandoned or unclaimed property law) be
discharged from such trust; and the Holder of such Security shall thereafter, as
an unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; PROVIDED, HOWEVER, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the Borough of
Manhattan, The City of New York, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less than 30 days from
the date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Company.
SECTION 1004. STATEMENT AS TO COMPLIANCE.
The Company shall deliver to the Trustee, within 120 days after the
end of each calendar year of the Company ending after the date hereof, an
Officers' Certificate covering the preceding calendar year, stating whether or
not to the best knowledge of the signers thereof the Company is in default in
the performance, observance or fulfillment of or compliance with any of the
terms, provisions, covenants and conditions of this Indenture, and if the
Company shall be in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge. For the purpose of this Section
1004, compliance shall be determined without regard to any grace period or
requirement of notice provided pursuant to the terms of this Indenture.
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SECTION 1005. WAIVER OF CERTAIN COVENANTS.
The Company may omit in any particular instance to comply with any
covenant or condition as specified as contemplated by Section 301 with respect
to the Securities of any series, if before or after the time for such compliance
the Holders of at least a majority in principal amount of the Outstanding
Securities of such series shall, by Act of such Holders, either waive such
compliance in such instance or generally waive compliance with such covenant or
condition, but no such waiver shall extend to or affect such covenant or
condition except to the extent so expressly waived, and, until such waiver shall
become effective, the obligations of the Company in respect of any such covenant
or condition shall remain in full force and effect.
SECTION 1006. ADDITIONAL SUMS.
In the case of the Securities of a series issued to an NVP Trust,
except as otherwise specified as contemplated by Section 301, in the event that
(i) an NVP Trust is the Holder of all of the Outstanding Securities of such
series, (ii) a Tax Event in respect of such NVP Trust shall have occurred and be
continuing and (iii) the Company shall not have (x) redeemed the Securities of
such series pursuant to Section 1107(b) or (y) terminated such NVP Trust
pursuant to Section 902(b) of the related Trust Agreement, the Company shall pay
to such NVP Trust (and its permitted successors or assigns under the related
Trust Agreement) for so long as such NVP Trust (or its permitted successor or
assignee) is the registered holder of any Securities of such series, such
additional amounts as may be necessary in order that the amount of distributions
(including any Additional Amounts (as defined in the Trust Agreement)) then due
and payable by such NVP Trust on the related Preferred Securities and Common
Securities that at any time remain outstanding in accordance with the terms
thereof shall not be reduced as a result of any Additional Taxes (the
"Additional Sums"). Whenever in this Indenture or the Securities there is a
reference in any context to the payment of principal of or interest on the
Securities, such mention shall be deemed to include mention of the payments of
the Additional Sums provided for in this paragraph to the extent that, in such
context, Additional Sums are, were or would be payable in respect thereof
pursuant to the provisions of this paragraph and express mention of the payment
of Additional Sums (if applicable) in any provisions hereof shall not be
construed as excluding Additional Sums in those provisions hereof where such
express mention is not made, provided, however, that the extension of an
interest payment period pursuant to Section 311 or the Securities shall not
extend the payment of any Additional Sums that may be due and payable during
such interest payment period.
SECTION 1007. ADDITIONAL COVENANTS.
The Company covenants and agrees with each Holder of Securities of a
series issued to an NVP Trust that it will not, and it will not permit any
Subsidiary of the Company to, (a) declare or pay any dividends or distributions
on, or redeem, purchase, acquire or make a liquidation payment with respect to,
any shares of the Company's capital stock, or (b) make any payment of principal,
interest or premium, if any, on or repay, repurchase or redeem any debt
securities that rank pari passu with or junior to the Securities of such series
or make any guarantee payments with respect to the foregoing (other than (a)
dividends or distributions in Common Stock of the Company, (b) redemptions or
purchases of any rights pursuant to the Company's Preferred Stock Rights Plan,
or
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any successor to such Preferred Stock Rights Plan, and the declaration of a
dividend of such rights or the issuance of Preferred Stock under such plans in
the future, (c) payments under any Nevada Power Guarantee, (d) purchases of
Common Stock related to the issuance of Common Stock under any of the Company's
benefit plans for its directors, officers or employees and (e) purchases of
Common Stock required to prevent the loss or secure the renewal or reinstatement
of any government license or franchise held by the Company or any of its
Subsidiaries) if at such time (I) there shall have occurred any event of which
the Company has actual knowledge that (a) with the giving of notice or the lapse
of time or both, would constitute an Event of Default hereunder and (b) in
respect of which the Company shall not have taken reasonable steps to cure, (ii)
the Company shall be in default with respect to its payment of any obligations
under the related Nevada Power Guarantee or (iii) the Company shall have given
notice of its election to begin an Extension Period as provided herein and shall
not have rescinded such notice, or such period, or any extension thereof, shall
be continuing.
The Company also covenants with each Holder of Securities of a series
issued to an NVP Trust (I) to maintain directly or indirectly 100% ownership of
the Common Securities of such NVP Trust; provided, however, that any permitted
successor of the Company hereunder may succeed to the Company's ownership of
such Common Securities, (ii) not to voluntarily terminate, wind-up or liquidate
such NVP Trust, except (a) in connection with a distribution of the Securities
of such series to the holders of Preferred Securities in liquidation of such NVP
Trust or (b) in connection with certain mergers, consolidations or amalgamations
permitted by the related Trust Agreement and (iii) to use its reasonable
efforts, consistent with the terms and provisions of such Trust Agreement, to
cause such NVP Trust to remain classified as a grantor trust and not as an
association taxable as a corporation for United States federal income tax
purposes.
ARTICLE XI
REDEMPTION OF SECURITIES
SECTION 1101. APPLICABILITY OF THIS ARTICLE.
Redemption of Securities (whether by operation of a sinking fund or
otherwise) as permitted or required by any form of Security issued pursuant to
this Indenture shall be made in accordance with such form of Security and this
Article; provided, however, that if any provision of any such form of Security
shall conflict with any provision of this Article, the provision of such form of
Security shall govern. Except as otherwise set forth in the form of Security for
such series, each Security shall be subject to partial redemption only in the
amount of $25 or, in the case of the Securities of a series issued to an NVP
Trust, $25, or integral multiples thereof.
SECTION 1102. ELECTION TO REDEEM; NOTICE TO TRUSTEE.
The election of the Company to redeem any Securities shall be
evidenced by or pursuant to a Board Resolution. In case of any redemption at the
election of the Company of less than all of the Securities of any particular
series and having the same terms, the Company shall, not less than 30 nor more
than 60 days prior to the date fixed for redemption (unless a shorter notice
shall be
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satisfactory to the Trustee), notify the Trustee of such date and of the
principal amount of Securities of that series to be redeemed. In the case of any
redemption of Securities prior to the expiration of any restriction on such
redemption provided in the terms of such Securities, the Company shall furnish
the Trustee with an Officers' Certificate and an Opinion of Independent Counsel
evidencing compliance with such restriction.
SECTION 1103. SELECTION OF SECURITIES TO BE REDEEMED.
If less than all the Securities of any series are to be redeemed
(unless all the Securities of such series and of a specified tenor are to be
redeemed or unless such redemption affects only a single Security), the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee, from the Outstanding Securities of
such series not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of a portion of the principal amount of any Security of such series,
provided that the unredeemed portion of the principal amount of any Security
shall be in an authorized denomination (which shall not be less than the minimum
authorized denomination) for such Security. If less than all the Securities of
such series and of a specified tenor are to be redeemed (unless such redemption
affects only a single Security), the particular Securities to be redeemed shall
be selected not more than 60 days prior to the Redemption Date by the Trustee,
from the Outstanding Securities of such series and specified tenor not
previously called for redemption in accordance with the preceding sentence.
The Trustee shall promptly notify the Company in writing of the
Securities selected for partial redemption and 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 Security redeemed or to be redeemed only in part, to the
portion of the principal amount of such Security which has been or is to be
redeemed. If the Company shall so direct, Securities registered in the name of
the Company, any Affiliate or any Subsidiary thereof shall not be included in
the Securities selected for redemption.
SECTION 1104. NOTICE OF REDEMPTION.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not later than the thirtieth day, and not earlier than the
sixtieth day, prior to the date fixed for redemption, to each Holder of
Securities to be redeemed, at the address of such Holder as it appears in the
Securities Register.
With respect to Securities of each series to be redeemed, each notice
of redemption shall state:
(a) the date fixed for redemption for Securities of such series;
(b) the redemption price at which Securities of such series are
to be redeemed;
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(c) if less than all Outstanding Securities of such particular
series and having the same terms are to be redeemed, the
identification (and, in the case of partial redemption, the respective
principal amounts) of the particular Securities to be redeemed;
(d) that on the date fixed for redemption, the redemption price
at which such Securities are to be redeemed will become due and
payable upon each such Security or portion thereof, and that interest
thereon, if any, shall 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 at which such
Securities are to be redeemed; and
(f) that the redemption is for a sinking fund, if such is the
case.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company and shall not be
irrevocable. The notice if mailed in the manner herein provided shall be
conclusively presumed to have been duly given, whether or not the Holder
receives such notice. In any case, a failure to give such notice by mail or any
defect in the notice to the Holder of any Security designated for redemption as
a whole or in part shall not affect the validity of the proceedings for the
redemption of any other Security.
SECTION 1105. DEPOSIT OF REDEMPTION PRICE.
Prior to 10:00 a.m. New York City time on the redemption date
specified in the notice of redemption given as provided in Section 1104, the
Company will deposit with the Trustee or with one or more paying agents an
amount of money sufficient to redeem on the redemption date all the Securities
so called for redemption at the applicable redemption price.
SECTION 1106. PAYMENT OF SECURITIES CALLED FOR REDEMPTION.
If any notice of redemption has been given as provided in Section
1104, the Securities or portion of Securities with respect to which such notice
has been given shall become due and payable on the date and at the place or
places stated in such notice at the applicable redemption price. On presentation
and surrender of such Securities at a place of payment in said notice specified,
the said securities or the specified portions thereof shall be paid and redeemed
by the Company at the applicable redemption price.
Upon presentation of any Security redeemed in part only, the Company
shall execute and the Trustee shall authenticate and deliver to the Holder
thereof, at the expense of the Company, a new Security or Securities of the same
series, of authorized denominations, in aggregate principal amount equal to the
unredeemed portion of the Security so presented and having the same Original
Issue Date, Stated Maturity and terms. If a Global Security is so surrendered,
such new Security will also be a new Global Security.
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If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal of and premium, if any, on such
Security shall, until paid, bear interest from the Redemption Date at the rate
prescribed therefor in the Security.
SECTION 1107. COMPANY'S RIGHT OF REDEMPTION.
(a) Unless otherwise specified as contemplated by Section 301
with respect to the Securities of a particular series and
notwithstanding any additional redemption rights that may be so
specified, the Company may, at its option, redeem the Securities of
any series after their date of issuance in whole at any time or in
part from time to time, subject to the provisions of this clause (a)
and the other provisions of this Article Eleven. Unless otherwise
specified as contemplated by Section 301 with respect to the
Securities of a particular series, the redemption price for any
Security so redeemed pursuant to this clause (a) shall be equal to
100% of the principal amount of such Securities plus any accrued and
unpaid interest, including any Additional Interest, to the date fixed
for redemption. The Company shall not redeem the Securities in part
unless all accrued and unpaid interest (including any Additional
Interest) has been paid in full on all Securities Outstanding for all
interest periods terminating on or prior to the date fixed for
redemption.
(b) In the case of the Securities of a series issued to an NVP
Trust, except as otherwise specified as contemplated by Section 301,
if a Special Event in respect of such NVP Trust shall occur and be
continuing, the Company may, at its option, redeem the Securities of
such series within 90 days of the occurrence of such Special Event, in
whole but not in part, subject to the provisions of this clause (b)
and the other provisions of this Article Eleven. The redemption price
for any Security so redeemed pursuant to this clause (b) shall be
equal to 100% of the principal amount of such Securities then
Outstanding plus accrued and unpaid interest, including any Additional
Interest, to the date fixed for redemption.
ARTICLE XII
SINKING FUNDS
SECTION 1201. APPLICABILITY OF ARTICLE.
The provisions of this Article shall be applicable to any sinking fund
for the retirement of Securities of any series except as otherwise specified as
contemplated by Section 301 for such Securities.
The minimum amount of any sinking fund payment provided for by the
terms of any Securities of any series is herein referred to as a "mandatory
sinking fund payment", and any sinking fund payment in excess of such minimum
amount which is permitted to be made by the terms of such Securities of any
series is herein referred to as an "optional sinking fund payment". If provided
for by the terms of any Securities of any series, the cash amount of any sinking
fund payment may be
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subject to reduction as provided in Section 1202. Each sinking fund payment
shall be applied to the redemption of Securities of any series as provided for
by the terms of such Securities.
SECTION 1202. SATISFACTION OF SINKING FUND PAYMENTS WITH
SECURITIES.
In lieu of making all or any part of a mandatory sinking fund payment
with respect to any Securities of a series in cash, the Company may at its
option, at any time no more than 16 months and no less than 30 days prior to the
date on which such sinking fund payment is due, deliver to the Trustee
Securities of such series (together with the unmatured Coupons, if any,
appertaining thereto) theretofore purchased or otherwise acquired by the
Company, except Securities of such series that have been redeemed through the
application of mandatory or optional sinking fund payments pursuant to the terms
of the Securities of such series, accompanied by a Company Order instructing the
Trustee to credit such obligations and stating that the Securities of such
series were originally issued by the Company by way of bona fide sale or other
negotiation for value; provided that the Securities to be so credited have not
been previously so credited. The Securities to be so credited shall be received
and credited for such purpose by the Trustee at the redemption price for such
Securities, as specified in the Securities so to be redeemed, for redemption
through operation of the sinking fund and the amount of such sinking fund
payment shall be reduced accordingly.
SECTION 1203. REDEMPTION OF SECURITIES FOR SINKING FUND.
Not less than 60 days prior to each sinking fund payment date for any
series of Securities, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing sinking fund payment for
such Securities pursuant to the terms of such Securities, the portion thereof,
if any, which is to be satisfied by payment of cash in the currency in which the
Securities of such series are payable (except as provided pursuant to Section
301) and the portion thereof, if any, which is to be satisfied by delivering and
crediting Securities pursuant to Section 1202 and will also deliver to the
Trustee any Securities to be so delivered. Such Certificate shall be irrevocable
and upon its delivery the Company shall be obligated to make the cash payment or
payments therein referred to, if any, on or before the succeeding sinking fund
payment date. In the case of the failure of the Company to deliver such
Certificate (or, as required by this Indenture, the Securities and coupons, if
any, specified in such Certificate), the sinking fund payment due on the
succeeding sinking fund payment date for such series shall be paid entirely in
cash and shall be sufficient to redeem the principal amount of the Securities of
such series subject to a mandatory sinking fund payment without the right to
deliver or credit securities as provided in Section 1202 and without the right
to make the optional sinking fund payment with respect to such series at such
time.
Any sinking fund payment or payments (mandatory or optional) made in
cash plus any unused balance of any preceding sinking fund payments made with
respect to the Securities of any particular series shall be applied by the
Trustee (or by the Company if the Company is acting as its own Paying Agent) on
the sinking fund payment date on which such payment is made (or, if such payment
is made before a sinking fund payment date, on the sinking fund payment date
immediately following the date of such payment) to the redemption of Securities
of such series at the redemption price specified in such Securities with respect
to the sinking fund. Any sinking fund moneys not so applied or allocated by the
Trustee (or by the Company if the Company is acting as its own Paying
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Agent, segregated and held in trust as provided in Section 1003) for such series
and together with such payment (or such amount so segregated) shall be applied
in accordance with the provisions of this Section 1203. Any and all sinking fund
moneys with respect to the Securities of any particular series held by the
Trustee (or if the Company is acting as its own Paying Agent, segregated and
held in trust as provided in Section 1003) on the last sinking fund payment date
with respect to Securities of such series and not held for the payment or
redemption of particular Securities of such series shall be applied by the
Trustee (or by the Company if the Company is acting as its own Paying Agent),
together with other moneys, if necessary, to be deposited (or segregated)
sufficient for the purpose, to the payment of the principal of the Securities of
such series at Maturity. The Trustee shall select the Securities to be redeemed
upon such sinking fund payment date in the manner specified in Section 1103 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 1104. Such notice
having been duly given, the redemption of such Securities shall be made upon the
terms and in the manner stated in Section 1106. On or before each sinking fund
payment date, the Company shall pay to the Trustee (or, if the Company is acting
as its own Paying Agent, the Company shall segregate and hold in trust as
provided in Section 1003) in cash a sum in the currency in which Securities of
such series are payable (except as provided pursuant to Section 301) equal to
the principal and any interest accrued to the redemption date for Securities or
portions thereof to be redeemed on such sinking fund payment date pursuant to
this Section 1203.
Neither the Trustee nor the Company shall redeem any Securities of a
series with sinking fund moneys or mail any notice of redemption of Securities
of such series by operation of the sinking fund for such series during the
continuance of a default in payment of interest, if any, on any Securities of
such series or of any Event of Default (other than an Event of Default occurring
as a consequence of this paragraph) with respect to the Securities of such
series, except that if the notice of redemption shall have been provided in
accordance with the provisions hereof, the Trustee (or the Company if the
Company is then acting as its own Paying Agent) shall redeem such Securities if
cash sufficient for that purpose shall be deposited with the Trustee (or
segregated by the Company) for that purpose in accordance with the terms of this
Article Twelve. Except as aforesaid, any moneys in the sinking fund for such
series at the time when any such default or Event of Default shall occur and any
moneys thereafter paid into such sinking fund shall, during the continuance of
such default or Event of Default, be held as security for the payment of the
Securities and coupons, if any, of such series; provided, however, that in case
such default or Event of Default shall have been cured or waived herein, such
moneys shall thereafter be applied on the next sinking fund payment date for the
Securities of such series on which such moneys may be applied pursuant to the
provisions of this Section 1203.
ARTICLE XIII
SUBORDINATION OF SECURITIES
SECTION 1301. SECURITIES SUBORDINATE TO SENIOR DEBT.
The Company covenants and agrees, and each Holder of a Security, by
its acceptance thereof, likewise covenants and agrees, that, to the extent and
in the manner hereinafter set forth in
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this Article, the payment of the principal of (and premium, if any) and interest
(including any Additional Interest) on each and all of the Securities are hereby
expressly made subordinate and subject in right of payment to the prior payment
in full of all amounts then due and payable in respect of all Senior Debt.
SECTION 1302. PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company (each such event, if any, herein
sometimes referred to as a "Proceeding"), then the holders of Senior Debt shall
be entitled to receive payment in full of principal of (and premium, if any) and
interest, if any, on such Senior Debt, or provision shall be made for such
payment in cash or cash equivalents or otherwise in a manner satisfactory to the
holders of Senior Debt, before the Holders of the Securities are entitled to
receive or retain any payment or distribution of any kind or character, whether
in cash, property or securities (including any payment or distribution which may
be payable or deliverable by reason of the payment of any other Debt of the
Company (including any series of the Securities) subordinated to the payment of
the Securities, such payment or distribution being hereinafter referred to as a
"Junior Subordinated Payment"), on account of principal of (or premium, if any)
or interest (including any Additional Interest) on the Securities or on account
of the purchase or other acquisition of Securities by the Company or any
Subsidiary and to that end the holders of Senior Debt shall be entitled to
receive, for application to the payment thereof, any payment or distribution of
any kind or character, whether in cash, property or securities, including any
Junior Subordinated Payment, which may be payable or deliverable in respect of
the Securities in any such Proceeding.
In the event that, notwithstanding the foregoing provisions of this
Section, the Trustee or the Holder of any Security shall have received any
payment or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, including any Junior Subordinated
Payment, before all Senior Debt is paid in full or payment thereof is provided
for in cash or cash equivalents or otherwise in a manner satisfactory to the
holders of Senior Debt, and if such fact shall, at or prior to the time of such
payment or distribution, have been made known to the Trustee or, as the case may
be, such Holder, then and in such event such payment or distribution shall be
paid over or delivered forthwith to the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee, agent or other Person making payment
or distribution of assets of the Company for application to the payment of all
Senior Debt remaining unpaid, to the extent necessary to pay all Senior Debt in
full, after giving effect to any concurrent payment or distribution to or for
the holders of Senior Debt.
For purposes of this Article only, the words "any payment or
distribution of any kind or character, whether in 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 of reorganization or readjustment which securities are subordinated in
right of payment to all then outstanding Senior Debt to substantially the same
extent as the Securities are so subordinated as provided in this Article. The
consolidation of the Company with, or the merger of the Company into, another
Person or the liquidation or dissolution of the Company following the
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sale of all or substantially all of its properties and assets as an entirety to
another Person or the liquidation or dissolution of the Company following the
sale of all or substantially all of its properties and assets as an entirety to
another Person upon the terms and conditions set forth in Article Eight shall
not be deemed a Proceeding for the purposes of this Section if the Person formed
by such consolidation or into which the Company is merged or the Person which
acquires by sale such properties and assets as an entirety, as the case may be,
shall, as a part of such consolidation, merger, or sale comply with the
conditions set forth in Article Eight.
SECTION 1303. PRIOR PAYMENT TO SENIOR DEBT UPON ACCELERATION OF
SECURITIES.
In the event that any Securities are declared due and payable before
their Maturity, then and in such event the holders of the Senior Debt
outstanding at the time such Securities so become due and payable shall be
entitled to receive payment in full of all amounts due on or in respect of such
Senior Debt (including any amounts due upon acceleration), or provision shall be
made for such payment in cash or cash equivalents or otherwise in a manner
satisfactory to the holders of Senior Debt, before the Holders of the Securities
are entitled to receive any payment or distribution of any kind or character,
whether in cash, properties or securities (including any Junior Subordinated
Payment) by the Company on account of the principal of (or premium, if any) or
interest (including any Additional Interest) on the Securities or on account of
the purchase or other acquisition of Securities by the Company or any
Subsidiary; provided, however, that nothing in this Section shall prevent the
satisfaction of any sinking fund payment in accordance with this Indenture or as
otherwise specified as contemplated by Section 301 for the Securities of any
series by delivering and crediting pursuant to Section 1202 or as otherwise
specified as contemplated by Section 301 for the Securities of any series
Securities which have been acquired (upon redemption or otherwise) prior to such
declaration of acceleration.
In the event that, notwithstanding the foregoing, the Company shall
make any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known to the Trustee or, as the case may
be, such Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.
The provisions of this Section shall not apply to any payment with
respect to which Section 1302 would be applicable.
SECTION 1304. NO PAYMENT WHEN SENIOR DEBT IN DEFAULT.
(a) In the event and during the continuation of any default in the
payment of principal of (or premium, if any) or interest on any Senior Debt, or
in the event that any event of default with respect to any Senior Debt shall
have occurred and be continuing and shall have resulted in such Senior Debt
becoming or being declared due and payable prior to the date on which it would
otherwise have become due and payable, unless and until such event of default
shall have been cured or waived or shall have ceased to exist and such
acceleration shall have been rescinded or annulled, or (b) in the event any
judicial proceeding shall be pending with respect to any such default in payment
or such event or default, then no payment or distribution of any kind or
character, whether
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in cash, properties or securities (including any Junior Subordinated Payment)
shall be made by the Company on account of principal of (or premium, if any) or
interest (including any Additional Interest), if any, on the Securities or on
account of the purchase or other acquisition of Securities by the Company or any
Subsidiary; provided, however, that nothing in this Section shall prevent the
satisfaction of any sinking fund payment in accordance with this Indenture or as
otherwise specified as contemplated by Section 301 for the Securities of any
series by delivering and crediting pursuant to Section 1202 or as otherwise
specified as contemplated by Section 301 for the Securities of any series
Securities which have been acquired (upon redemption or otherwise) prior to such
default in payment or event of default.
In the event that, notwithstanding the foregoing, the Company shall
make any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known to the Trustee or, as the case may
be, such Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.
The provisions of this Section shall not apply to any payment with
respect to which Section 1302 would be applicable.
SECTION 1305. PAYMENT PERMITTED IF NO DEFAULT.
Nothing contained in this Article or elsewhere in this Indenture or in
any of the Securities shall prevent (a) the Company, at any time except during
the pendency of any Proceeding referred to in Section 1302 or under the
conditions described in Sections 1303 and 1304, from making payments at any time
of principal of (and premium, if any) or interest on the Securities, or (b) the
application by the Trustee of any money or Government Obligations deposited with
it hereunder to the payment of or on account of the principal of (and premium,
if any) or interest (including any Additional Interest) on the Securities or the
retention of such payment by the Holders, if, at the time of such application by
the Trustee, it did not have knowledge that such payment would have been
prohibited by the provisions of this Article.
SECTION 1306. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR DEBT.
Subject to the payment in full of all Senior Debt, or the provision
for such payment in cash or cash equivalents or otherwise in a manner
satisfactory to the holders of Senior Debt, the Holders of the Securities shall
be subrogated to the extent of the payments or distributions made to the holders
of such Senior Debt pursuant to the provisions of this Article (equally and
ratably with the holders of all indebtedness of the Company which by its express
terms is subordinated to Senior Debt of the Company to substantially the same
extent as the Securities are subordinated to the Senior Debt and is entitled to
like rights of subrogation by reason of any payments or distributions made to
holders of such Senior Debt) to the rights of the holders of such Senior Debt to
receive payments and distributions of cash, property and securities applicable
to the Senior Debt until the principal of (and premium, if any) and interest on
the Securities shall be paid in full. For purposes of such subrogation or
assignment, no payments or distributions to the holders of the Senior Debt of
any cash, property or securities to which the Holders of the Securities or the
Trustee would be entitled except for the
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provisions of this Article, and no payments over pursuant to the provisions of
this Article to the holders of Senior Debt by Holders of the Securities or the
Trustee, shall, as among the Company, its creditors other than holders of Senior
Debt, and the Holders of the Securities, be deemed to be a payment or
distribution by the Company to or on account of the Senior Debt.
SECTION 1307. PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS.
The provisions of this Article are and are intended solely for the
purpose of defining the relative rights of the Holders of the Securities on the
one hand and the holders of Senior Debt on the other hand. Nothing contained in
this Article or elsewhere in this Indenture or in the Securities is intended to
or shall (a) impair, as between the Company and the Holders of the Securities,
the obligations of the Company, which are absolute and unconditional, to pay to
the Holders of the Securities the principal of (and premium, if any) and
interest (including any Additional Interest) on the Securities as and when the
same shall become due and payable in accordance with their terms; or (b) affect
the relative rights against the Company of the Holders of the Securities and
creditors of the Company other than their rights in relation to the holders of
Senior Debt; or (c) prevent the Trustee or the Holder of any Security from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture including, without limitation, filing and voting claims in any
Proceeding, subject to the rights, if any, under this Article of the holders of
Senior Debt to receive cash, property and securities otherwise payable or
deliverable to the Trustee or such Holder.
SECTION 1308. TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder of a Security by his or her acceptance thereof authorizes
and directs the Trustee on his or her behalf to take such action as may be
necessary or appropriate to acknowledge or effectuate the subordination provided
in this Article and appoints the Trustee his or her attorney-in-fact for any and
all such purposes.
SECTION 1309. NO WAIVER OF SUBORDINATION PROVISIONS.
No right of any present or future holder of any Senior Debt to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any noncompliance by
the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof that any such holder may have or be
otherwise charged with.
SECTION 1310. NOTICE TO TRUSTEE.
The Company shall give prompt written notice to the Trustee of any
fact known to the Company which would prohibit the making of any payment to or
by the Trustee in respect of the Securities. Notwithstanding the provisions of
this Article or any other provision of this Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the Trustee in respect of the Securities, unless
and until the Trustee shall have received written notice thereof from the
Company or a holder of Senior Debt or from any trustee, agent or representative
therefor (whether or not the facts contained in such notice are true);
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provided, however, that if the Trustee shall not have received the notice
provided for in this Section at least two Business Days prior to the date upon
which by the terms hereof any monies may become payable for any purpose
(including, without limitation, the payment of the principal of (and premium, if
any) or interest (including any Additional Interest) on any Security), then,
anything herein contained to the contrary notwithstanding, the Trustee shall
have full power and authority to receive such monies and to 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 within two Business Days prior to
such date.
SECTION 1311. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF
LIQUIDATING AGENT.
Upon any payment or distribution of assets of the Company referred
to in this Article, the Trustee, subject to the provisions of Article Six,
and the Holders of the Securities shall be entitled to rely upon any order or
decree entered by any court of competent jurisdiction in which such
Proceeding is pending, or a certificate of the trustee in bankruptcy,
receiver, liquidating trustee, custodian, assignee for the benefit of
creditors, agent or other Person making such payment or distribution,
delivered to the Trustee or to the Holders of Securities, for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Debt 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 1312. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR DEBT.
The Trustee, in its capacity as trustee under this Indenture, shall
not be deemed to owe any fiduciary duty to the holders of Senior Debt and shall
not be liable to any such holders if it shall in good faith mistakenly pay over
or distribute to Holders of Securities or to the Company or to any other Person
cash, property or securities to which any holders of Senior Debt shall be
entitled by virtue of this Article or otherwise.
SECTION 1313. RIGHTS OF TRUSTEE AS HOLDER OF SENIOR DEBT;
PRESERVATION OF TRUSTEE'S RIGHTS.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article with respect to any Senior Debt which may at
any time be held by it, to the same extent as any other holder of Senior Debt,
and nothing in this Indenture shall deprive the Trustee of any of its rights as
such holder.
SECTION 1314. ARTICLE APPLICABLE TO PAYING AGENTS.
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 otherwise
requires) 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.
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SECTION 1315. CERTAIN CONVERSIONS OR EXCHANGES DEEMED PAYMENT.
For the purposes of this Article only, (a) the issuance and delivery
of junior securities upon conversion or exchange of Securities shall not be
deemed to constitute a payment or distribution on account of the principal of
(or premium, if any) or interest (including any Additional Interest) on
Securities or on account of the purchase or other acquisition of Securities, and
(b) the payment, issuance or delivery of cash, property or securities (other
than junior securities) upon conversion or exchange of a Security shall be
deemed to constitute payment on account of the principal of such security. For
the purposes of this Section, the term "junior securities" means (i) shares of
any stock of any class of the Company and (ii) securities of the Company which
are subordinated in right of payment to all Senior Debt which may be outstanding
at the time of issuance or delivery of such securities to substantially the same
extent as, or to a greater extent than, the Securities are so subordinated as
provided in this Article.
* * * *
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, and their respective corporate seals to be hereunto affixed
and attested, all as of the day and year first above written.
NEVADA POWER COMPANY
By:___________________________
Attest:
___________________________
_______________________________, as
Trustee
By:___________________________
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<PAGE>
State of :
: ss.
County of :
On the _____ day of _________, ___ before me personally came
__________, to me known, who being duly sworn, did depose and say that he/she is
______ of Nevada Power Company, one of the corporations described in and which
executed the foregoing instrument; that 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
My Commission Expires:
State of :
: ss.
County of :
On the _____ day of _______, ____ before me personally came
__________, to me known, who being duly sworn, did depose and say that he/she is
_________ of ____________________, a _____________________, described in and
which executed the foregoing instrument; that he knows the seal of said
association; 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
association, and that he signed his name thereto by like authority.
______________________________
Notary Public
My Commission Expires:
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<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
AMENDED AND RESTATED
TRUST AGREEMENT
among
NEVADA POWER COMPANY, as Depositor,
IBJ Schroder Bank & Trust Company, as Property Trustee
Delaware Trust Capital Management, Inc., as Delaware Trustee,
and
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN
Dated as of _____________, 1997
NVP CAPITAL I
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<PAGE>
TABLE OF CONTENTS
ARTICLE I
SECTION 101. Definitions.....................................................1
ARTICLE II
ESTABLISHMENT OF THE TRUST
SECTION 201. Name............................................................9
SECTION 202. Office of the Delaware Trustee; Principal Place of Business.....9
SECTION 203. Initial Contribution of Trust Property; Organizational
Expenses........................................................9
SECTION 204. Issuance of the Preferred Securities............................9
SECTION 205. Issuance of Common Securities; Subscription and Purchase of
Debentures.....................................................10
SECTION 206. Declaration of Trust...........................................10
SECTION 207. Authorization to Enter into Certain Transactions...............10
SECTION 208. Assets of Trust................................................13
SECTION 209. Title to Trust Property........................................14
ARTICLE III
PAYMENT ACCOUNT
SECTION 301. Payment Account................................................14
ARTICLE IV
DISTRIBUTIONS; REDEMPTION
SECTION 401. Distributions..................................................14
SECTION 402. Redemption.....................................................15
SECTION 403. Subordination of Common Securities.............................17
SECTION 404. Payment Procedures.............................................17
SECTION 405. Tax Returns and Reports........................................18
SECTION 406. Payment of Taxes, Duties, Etc. of the Trust....................18
SECTION 407. Payments under Indenture.......................................18
ARTICLE V
TRUST SECURITIES CERTIFICATES
SECTION 501. Initial Ownership..............................................18
SECTION 502. The Trust Securities Certificates..............................18
SECTION 503. Execution and Delivery of Trust Securities Certificates........19
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SECTION 504. Registration of Transfer and Exchange of Preferred Securities
Certificates...................................................19
SECTION 505. Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates...................................................19
SECTION 506. Persons Deemed Securityholders.................................20
SECTION 507. Access to List of Securityholders' Names and Addresses.........20
SECTION 508. Maintenance of Office or Agency................................20
SECTION 509. Appointment of Paying Agent....................................21
SECTION 510. Ownership of Common Securities by Depositor....................21
SECTION 511. Book-Entry Preferred Securities Certificates; Common
Securities Certificate.........................................21
SECTION 512. Notices to Clearing Agency.....................................22
SECTION 513. Definitive Preferred Securities Certificates...................22
SECTION 514. Rights of Securityholders......................................23
ARTICLE VI
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
SECTION 601. Limitations on Voting Rights...................................24
SECTION 602. Notice of Meetings.............................................25
SECTION 603. Meetings of Preferred Securityholders..........................25
SECTION 604. Voting Rights..................................................25
SECTION 605. Proxies, etc...................................................25
SECTION 606. Securityholder Action by Written Consent.......................26
SECTION 607. Record Date for Voting and Other Purposes......................26
SECTION 608. Acts of Securityholders........................................26
SECTION 609. Inspection of Records..........................................27
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
SECTION 701. Representations and Warranties of the Bank, the Property Trustee
and the Delaware Trustee......................................27
SECTION 702. Representations and Warranties of Depositor....................28
ARTICLE VIII
THE TRUSTEES
SECTION 801. Certain Duties and Responsibilities............................29
SECTION 802. Certain Notices................................................30
SECTION 803. Certain Rights of Property Trustee.............................30
SECTION 804. Not Responsible for Recitals or Issuance of Securities.........32
SECTION 805. May Hold Securities............................................32
SECTION 806. Compensation; Indemnity; Fees..................................33
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<PAGE>
SECTION 807. Corporate Property Trustee Required; Eligibility of Trustees...33
SECTION 808. Conflicting Interests..........................................34
SECTION 809. CoTrustees and Separate Trustee................................34
SECTION 810. Resignation and Removal; Appointment of Successor..............35
SECTION 811. Acceptance of Appointment by Successor.........................36
SECTION 812. Merger, Conversion, Consolidation or Succession to Business....37
SECTION 813. Preferential Collection of Claims Against Depositor or Trust...37
SECTION 814. Reports by Property Trustee....................................38
SECTION 815. Reports to the Property Trustee................................38
SECTION 816. Evidence of Compliance with Conditions Precedent...............38
SECTION 817. Number of Trustees.............................................39
SECTION 818. Delegation of Power............................................39
ARTICLE IX
TERMINATION, LIQUIDATION AND MERGER
SECTION 901. Termination Upon Expiration Date...............................39
SECTION 902. Early Termination..............................................39
SECTION 903. Termination....................................................40
SECTION 904. Liquidation....................................................40
SECTION 905. Mergers, Consolidations, Amalgamations or Replacements of the
Trust..........................................................41
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 1001. Limitation of Rights of Securityholders........................42
SECTION 1002. Amendment......................................................42
SECTION 1003. Separability...................................................44
SECTION 1004. Governing Law..................................................44
SECTION 1005. Payments Due on NonBusiness Day................................44
SECTION 1006. Successors.....................................................44
SECTION 1007. Headings.......................................................44
SECTION 1008. Reports, Notices and Demands...................................44
SECTION 1009. Agreement Not to Petition......................................45
SECTION 1010. Trust Indenture Act; Conflict with Trust Indenture Act.........45
SECTION 1011. Acceptance of Terms of Trust Agreement, Guarantee and
Indenture......................................................45
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<PAGE>
NVP 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
(S) 310 (a)(1) . . . . . . . . . . . . . . . . . . . . . . . 807
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . 807
(a)(3) . . . . . . . . . . . . . . . . . . . . . . . 809
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . 207(a)(ii)
(b). . . . . . . . . . . . . . . . . . . . . . . . . 808
(S) 311 (a). . . . . . . . . . . . . . . . . . . . . . . . . 813
(b). . . . . . . . . . . . . . . . . . . . . . . . . 813
(S) 312 (a). . . . . . . . . . . . . . . . . . . . . . . . . 507
(b). . . . . . . . . . . . . . . . . . . . . . . . . 507
(c). . . . . . . . . . . . . . . . . . . . . . . . . 507
(d). . . . . . . . . . . . . . . . . . . . . . . . . 507
(S) 313 (a). . . . . . . . . . . . . . . . . . . . . . . . . 814(a)
(b). . . . . . . . . . . . . . . . . . . . . . . . . 814(b)
(c). . . . . . . . . . . . . . . . . . . . . . . . . 1008
(d). . . . . . . . . . . . . . . . . . . . . . . . . 814(c)
(S) 314 (a). . . . . . . . . . . . . . . . . . . . . . . . . 815
(b). . . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . . . . . . . . . . . . . . 816
(c)(2) . . . . . . . . . . . . . . . . . . . . . . . 816
(c)(3) . . . . . . . . . . . . . . . . . . . . . . . Not Appilcable
(d). . . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(e). . . . . . . . . . . . . . . . . . . . . . . . . 101, 816
(S) 315 (a). . . . . . . . . . . . . . . . . . . . . . . . . 801(a), 803(a)
(b). . . . . . . . . . . . . . . . . . . . . . . . . 802, 1008
(c). . . . . . . . . . . . . . . . . . . . . . . . . 801(a)
(d). . . . . . . . . . . . . . . . . . . . . . . . . 801, 803
(e). . . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(S) 316 (a). . . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(a)(1)(A). . . . . . . . . . . . . . . . . . . . . . Not Applicable
(a)(1)(B). . . . . . . . . . . . . . . . . . . . . . Not Applicable
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(b). . . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(c). . . . . . . . . . . . . . . . . . . . . . . . . 607
(S) 317 (a)(1) . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(b). . . . . . . . . . . . . . . . . . . . . . . . . 509
(S) 318 (a). . . . . . . . . . . . . . . . . . . . . . . . . 1010
_________________
Note: This reconciliation and tie sheet shall not, for any purpose, be deemed to
be a part of the Trust Agreement.
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<PAGE>
AMENDED AND RESTATED TRUST AGREEMENT, dated as of ________ __, 1997,
among (i) Nevada Power Company, a Nevada corporation (including any
successors or assigns, the "Depositor"), (ii) IBJ Schroder Bank & Trust
Company, a New York banking corporation duly organized and existing under the
laws of the State of New York as property trustee (the "Property Trustee")
and, in its separate corporate capacity and not in its capacity as Property
Trustee, the "Bank"), Delaware Trust Capital Management, Inc., a Delaware
Banking Corporation, as Delaware trustee (the "Delaware Trustee"), (iii)
Richard Hinckley, an individual, and Richard C. Schmalz, Jr., an individual,
each of whose address is c/o Nevada Power Company, 6226 West Sahara Avenue,
Las Vegas, Nevada 89102 (each, an "Administrative Trustee" and, collectively,
the "Administrative Trustees" and, collectively with the Property Trustee and
Delaware Trustee, the "Trustees") and (iv) the several Holders, as
hereinafter defined.
W I T N E S S E T H:
WHEREAS, the Depositor and the Delaware 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
____________, 1997 (the "Original Trust Agreement"), and by the execution and
filing by the Delaware Trustee with the Secretary of State of the State of
Delaware of the Certificate of Trust, filed on ___________, 1997, attached as
Exhibit A; and
WHEREAS, the Depositor and the Delaware 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 issuance of the Common Securities by the Trust to
the Depositor, (ii) the issuance and sale of the Preferred Securities by the
Trust pursuant to the Underwriting Agreement, (iii) the acquisition by the Trust
from the Depositor of all of the right, title and interest in the Debentures and
(iv) the appointment of the Administrative Trustees;
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 parties 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 101. 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;
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(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 608.
"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 Indenture) paid by the Depositor on a Like Amount of
Debentures for such period.
"ADDITIONAL SUMS" has the meaning specified in Section 1007 of the
Indenture.
"ADMINISTRATIVE TRUSTEE" means each of Richard Hinckley and Richard C.
Schmalz, Jr., each solely in such person's capacity as Administrative
Trustee of the Trust formed and continued hereunder and not in such person's
individual capacity, or such Administrative 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:
(a) 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 any applicable federal or
state bankruptcy, insolvency, reorganization or other similar 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
(b) the institution by such Person of proceedings to be adjudicated a
bankrupt or insolvent, or the consent by it to the institution of bankruptcy or
insolvency proceedings against it,
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<PAGE>
or the filing by it of a petition or answer or consent seeking reorganization or
relief under any applicable federal or state bankruptcy, insolvency,
reorganization or other similar law, or the consent by it to the filing of any
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 and its willingness to be adjudicated a bankrupt,
or the taking of corporate action by such Person in furtherance of any such
action.
"BANKRUPTCY LAWS" has the meaning specified in Section 1009.
"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 such committee of the Board of Directors or
officers of the Company to which authority to act on behalf of the Board of
Directors has been delegated, and to be in full force and effect on the date
of such certification, and delivered to the Trustees.
"BOOK-ENTRY PREFERRED SECURITIES CERTIFICATES" means a beneficial interest
in the Preferred Securities Certificates, ownership and transfers of which
shall be made through book entries by a Clearing Agency as described in
Section 511.
"BUSINESS DAY" means a day other than (a) a Saturday or Sunday, (b) 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 (c) a day on which the
Property Trustee's Corporate Trust Office or the Corporate Trust Office of the
Debenture Trustee is closed for business.
"CERTIFICATE DEPOSITORY AGREEMENT" means the agreement among the Trust, the
Depositor and The Depository Trust Company, as the initial Clearing Agency,
dated as of the Closing Date, relating to the Trust Securities Certificates,
substantially in the form attached as Exhibit B, as the same may be amended
and supplemented from time to time.
"CLEARING AGENCY" means an organization registered as a "clearing Agency"
pursuant to Section 17A of the Securities Exchange Act of 1934, as amended.
The Depository Trust Company will be the initial Clearing Agency.
"CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency
effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"CLOSING DATE" means the First Time of Delivery, which date is also the
date of execution and 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 Securities Exchange Act of 1934, as amended,
or, if at any time after
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<PAGE>
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 C.
"CORPORATE TRUST OFFICE" means the principal office of the Property Trustee
located in New York, New York.
"DEBENTURE EVENT OF DEFAULT" means an "Event of Default" as defined in the
Indenture.
"DEBENTURE REDEMPTION DATE" means, with respect to any Debentures to be
redeemed under the Indenture, the date fixed for redemption under the Indenture.
"DEBENTURE TAX EVENT" means a "Tax Event" as defined in the Indenture.
"DEBENTURE TRUSTEE" means ______________________, a __________ banking
corporation organized under the laws of the State of ____________ and any
successor thereto.
"DEBENTURES" means the $___________ aggregate principal amount of the
Depositor's ____% Junior Subordinated Deferrable Interest Debentures, Series A,
issued pursuant to the Indenture.
"DEFINITIVE PREFERRED SECURITIES CERTIFICATES" means either or both (as the
context requires) of (a) Preferred Securities Certificates issued as Book-Entry
Preferred Securities Certificates as provided in Section 511(a) and (b)
Preferred Securities Certificates issued in certificated, fully registered
form as provided in Section 513.
"DELAWARE BUSINESS TRUST ACT" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. Section 3801, ET SEQ., as it may be amended from time to time.
"DELAWARE TRUSTEE" means the commercial bank or trust company identified as
the "Delaware Trustee" in the preamble to this Trust Agreement solely in its
capacity as Delaware 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.
"DEPOSITOR" has the meaning specified in the preamble to this Agreement.
"DISTRIBUTION DATE" has the meaning specified in Section 401(a).
"DISTRIBUTIONS" means amounts payable in respect of the Trust Securities as
provided in Section 401.
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"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):
(a) the occurrence of a Debenture Event of Default; or
(b) default by the Property Trustee in the payment of any Distribution
when it becomes due and payable, and continuation of such default for a
period of 30 days; or
(c) default by the Property Trustee in the payment of any Redemption
Price of any Trust Security when it becomes due and payable; or
(d) 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 the performance of which or the breach of
which is dealt with in clause (b) or (c) 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 defaulting Trustee or Trustees by the Holders of at least
25% in aggregate liquidation preference 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
(e) the occurrence of a Bankruptcy Event with respect to the Property
Trustee and the failure by the Depositor to appoint a successor Property Trustee
within 60 days thereof.
"EXPENSE AGREEMENT" means the Agreement as to Expenses and Liabilities
between the Depositor and the Trust, substantially in the form attached as
Exhibit D, as amended from time to time.
"EXPIRATION DATE" has the meaning specified in Section 901.
"FIRST TIME OF DELIVERY" has the meaning specified in the Underwriting
Agreement.
"GUARANTEE" means the Guarantee Agreement executed and delivered by the
Depositor and IBJ Schroder Bank & Trust Company, 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.
"INDENTURE" means the Junior Subordinated Indenture, dated as of,
_____________,1997, as supplemented by a Supplemental Indenture No. 1, dated as
of _____________, 1997, between the Depositor and the Debenture Trustee, as
trustee, as amended or supplemented from time to time.
"INVESTMENT COMPANY EVENT" means the receipt by the Trust of an Opinion of
Counsel, rendered by a law firm having a recognized national tax and
securities practice, to the effect that, as a result of 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 (a "Change in 1940 Act Law"), the Trust is or will be
considered an "investment company"
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that is required to be registered under the 1940 Act, which Change in 1940 Act
Law becomes effective on or after the date of original issuance of the
Preferred Securities under this Trust Agreement.
"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 (a) with respect to a redemption of Trust Securities,
Trust Securities having a Liquidation Amount equal to the principal amount of
Debentures to be contemporaneously redeemed in accordance with the Indenture
the proceeds of which will be used to pay the Redemption Price of such Trust
Securities and (b) with respect to a distribution of Debentures to Holders of
Trust Securities in connection with a dissolution or liquidation of the Trust,
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 904(a).
"LIQUIDATION DISTRIBUTION" has the meaning specified in Section
904(d).
"1940 ACT" means the Investment Company Act of 1940, as amended.
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman and
Chief Executive Officer, President or a Vice President, and by the 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 816 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.
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"OPINION OF COUNSEL" means a written opinion of counsel, who may be counsel
for the Trust, the Property Trustee or the Depositor or General Counsel of 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 executed and
delivered under this Trust Agreement, except:
(a) Preferred Securities theretofore cancelled by the Property
Trustee or delivered to the Property Trustee for cancellation;
(b) 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
(c) Preferred Securities which have been paid or in exchange for or
in lieu of which other Preferred Securities have been executed and
delivered pursuant to Section 504, 505, 511 and 513;
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 that 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 Trustees 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 Book-Entry
Preferred Securities Certificate as reflected in the records of the Clearing
Agency or, if a Clearing Agency Participant is not the Owner, then as reflected
in the records of a Person maintaining an account with such Clearing Agency
(directly or indirectly, in accordance with the rules of such Clearing Agency).
"PAYING AGENT" means any paying agent or co-paying agent appointed pursuant
to Section 509 and shall initially be the Bank.
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"PAYMENT ACCOUNT" means a segregated non-interest-bearing corporate trust
account maintained by the Property Trustee with the Bank 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 Property Trustee shall make
payments to the Securityholders in accordance with Sections 401 and 402.
"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 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.
"PREFERRED SECURITIES CERTIFICATE" means a certificate evidencing ownership
of Preferred Securities, substantially in the form attached as Exhibit E.
"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 heretofore formed and continued
hereunder and not in its individual capacity, or its successor in interest in
such capacity, or any successor property 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 and the stated maturity of the
Debentures shall be a Redemption Date for a Like Amount of Trust Securities.
"REDEMPTION PRICE" means, with respect to any Trust Security, the
Liquidation Amount of such Trust Security, plus accumulated and unpaid
Distributions to the Redemption Date, plus the related amount of the premium, if
any, paid by the Depositor upon the concurrent redemption of a Like Amount of
Debentures, allocated on a pro rata basis (based on Liquidation Amounts) among
the Trust Securities.
"RELEVANT TRUSTEE" shall have the meaning specified in Section 810.
"SECOND TIME OF DELIVERY" has the meaning specified in the Underwriting
Agreement.
"SECURITIES REGISTER" and "Securities Registrar" have the respective
meanings specified in Section 504.
"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 a Tax Event or an Investment Company Event.
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"TAX EVENT" means the receipt by the Trust of an Opinion of Counsel,
rendered by a law firm having a national tax and securities practice, 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, or as a result of any official administrative pronouncement or judicial
decision interpreting or applying such laws or regulations, which amendment or
change is effective or which pronouncement or decision is announced on or
after the date of 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 after the date of such Opinion of Counsel, 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 after the date of such Opinion of Counsel, will not be,
deductible by the Depositor, in whole or in part, for United States federal
income tax purposes or (iii) the Trust is, or will be within 90 days after the
date of such Opinion of Counsel, subject to more than a de minimis amount of
other taxes, duties, assessments or other governmental charges.
"TIME OF DELIVERY" means, collectively, the First Time of Delivery and the
Second Time of Delivery.
"TRUST" means the Delaware business trust created 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 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 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 (a) the Debentures, (b) the rights of the Property
Trustee under the Guarantee, (c) any cash on deposit in, or owing to, the
Payment Account and (d) all proceeds and rights in respect of the foregoing and
any other property and assets for the time being held or deemed to be 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.
"TRUSTEES" means, collectively, the Property Trustee, the Delaware Trustee
and the Administrative Trustees.
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"UNDERWRITING AGREEMENT" means the Terms Agreement, dated as of
_______________, 1997, among the Trust, the Depositor and the Underwriters named
therein, incorporating the Underwriting Agreement Basic Provisions of the Trust.
ARTICLE II
ESTABLISHMENT OF THE TRUST
SECTION 201. NAME. The Trust created and continued hereby shall be known
as "NVP Capital I," as such name may be modified from time to time by the
Administrative Trustees following written notice to the Holders of Trust
Securities and the other Trustees, 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 202. OFFICE OF THE DELAWARE TRUSTEE; PRINCIPAL PLACE OF
BUSINESS. The address of the Delaware Trustee in the State of Delaware is c/o
Delaware Trust Capital Management, Inc., 900 Market Street, Second Floor,
Wilmington, Delaware 18901, Attention: Corporate Trust Administration, or
such other address in the State of Delaware as the Delaware Trustee may
designate by written notice to the Securityholders and the Depositor. The
principal executive office of the Trust is c/o Nevada Power Company, 6226
West Sahara Avenue, Las Vegas, Nevada 89102.
SECTION 203. 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 204. ISSUANCE OF THE PREFERRED SECURITIES. On _____________,
1997 the Depositor, on behalf of the Trust and pursuant to the Original Trust
Agreement, executed and delivered the Underwriting Agreement. Contemporaneously
with the execution and delivery of this Trust Agreement, an Administrative
Trustee, on behalf of the Trust, shall execute in accordance with Section 502
and deliver to the Underwriters named in the Underwriting Agreement Preferred
Securities Certificates, registered in the name of the nominee of the initial
Clearing Agency, in an aggregate amount of $5,000,000 Preferred Securities
having an aggregate Liquidation Amount of $125,000,000, against receipt of the
aggregate purchase price of such Preferred Securities of $125,000,000, which
amount such Administrative Trustee shall promptly deliver to the Property
Trustee. having an aggregate Liquidation Amount of up to $___________, against
receipt of the aggregate purchase price of such Preferred Securities of 96.85%
of the Liquidation Amount thereof, which amount such Administrative Trustee
shall promptly deliver to the Property Trustee.
SECTION 205. ISSUANCE OF COMMON SECURITIES; SUBSCRIPTION AND PURCHASE OF
DEBENTURES. Contemporaneously with the execution and delivery of this Trust
Agreement, an Administrative Trustee, on behalf of the Trust, shall execute in
accordance with Section 502 and
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deliver to the Depositor Common Securities Certificates, registered in the name
of the Depositor, in an aggregate amount of 150,000 Common Securities having an
aggregate Liquidation Amount of $3,750,900 against payment by the Depositor of
such amount. Contemporaneously therewith, an Administrative Trustee, on behalf
of the Trust, shall subscribe to and purchase from the Depositor Debentures,
registered in the name of the Trust and having an aggregate principal amount
equal to $121,250,000, and, in satisfaction of the purchase price for such
Debentures, the Property Trustee, on behalf of the Trust, shall deliver to the
Depositor the sum of $121,250,000.
SECTION 206. DECLARATION OF TRUST. The exclusive purposes and functions
of the Trust are (a) to issue and sell Trust Securities and use the proceeds
from such sale to acquire the Debentures and (b) 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, and the Trustees hereby accept such
appointment. 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 Administrative 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. 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 207. 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 in accordance with the following provisions (i) and (ii), the
Administrative 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:
(i) As among the Trustees, each Administrative Trustee shall have the
power and authority to act on behalf of the Trust with respect to the following
matters:
(A) the issuance and sale of the Trust Securities;
(B) to cause the Trust to enter into, and to execute, deliver and
perform on behalf of the Trust, the Expense Agreement and the Certificate
Depository Agreement and such other agreements as may be necessary or desirable
in connection with the purposes and function of the Trust;
(C) assisting in 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;
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(D) assisting in the listing of the Preferred Securities upon such
national securities exchange, the Nasdaq National Market or such other
interdealer quotation system or self-regulatory organization as shall be
determined by the Depositor and the registration of the Preferred Securities
under the Securities Exchange Act of 1934, as amended, and the preparation and
filing of all periodic and other reports and other documents pursuant to the
foregoing;
(E) the sending of notices (other than notices of default) and other
information regarding the Trust Securities and the Debentures to the
Securityholders in accordance with this Trust Agreement;
(F) the appointment of a Paying Agent, authenticating agent and
Securities Registrar in accordance with this Trust Agreement;
(G) registering transfer of the Trust Securities in accordance with
this Trust Agreement;
(H) to the extent provided in this Trust Agreement, the winding-up of
the affairs of and liquidation of the Trust and the preparation, execution and
filing of the certificate of cancellation with the Secretary of State of the
State of Delaware;
(I) unless otherwise determined by the Depositor, the Property
Trustee or the Administrative Trustees, or as otherwise required by the Delaware
Business Trust Act or the Trust Indenture Act, to execute on behalf of the Trust
(either acting alone or together with any or all of the Administrative Trustees)
any documents that the Administrative Trustees have the power to execute
pursuant to this Trust Agreement; and
(J) the taking of any action incidental to the foregoing as the
Trustees may from time to time determine is necessary or advisable to give
effect to the terms of this Trust Agreement for the benefit of the
Securityholders (without consideration of the effect of any such action on any
particular Securityholder).
(ii) 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
matters:
(A) the establishment of the Payment Account;
(B) the receipt of the Debentures;
(C) the collection of interest, principal and any other payments made
in respect of the Debentures in the Payment Account;
(D) the distribution of amounts owed to the Securityholders in
respect of the Trust Securities;
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(E) the exercise of all of the rights, powers and privileges of a
holder of the Debentures;
(F) the sending of notices of default and other information regarding
the Trust Securities and the Debentures to the Securityholders in accordance
with this Trust Agreement;
(G) the distribution of the Trust Property in accordance with the
terms of this Trust Agreement;
(H) to the extent provided in this Trust Agreement, the winding-up of
the affairs of and liquidation of the Trust and the preparation, execution and
filing of the certificate of cancellation with the Secretary of State of the
State of Delaware;
(I) after an Event of Default the taking of any action incidental to
the foregoing as the Property Trustee may from time to time determine is
necessary or advisable to give effect to the terms of this Trust Agreement and
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);
(J) registering transfers of the Trust Securities in accordance with
this Trust Agreement; and
(K) except as otherwise provided in this Section 207(a)(ii), the
Property Trustee shall have none of the duties, liabilities, powers or the
authority of the Administrative Trustees set forth in Section 207(a)(i).
(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, mortgage, 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, (iv) incur any indebtedness for borrowed money or issue any
other debt or (v) take or consent to any action that would result in the
placement of a Lien on any of the Trust Property. The Administrative 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 and sale 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):
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(i) the preparation and filing by the Trust with the Commission and
the execution on behalf of the Trust of a registration statement on the
appropriate form in relation to the Preferred Securities and the Debentures,
including any amendments thereto;
(ii) the determination of the states in which to take appropriate
action to qualify or register for sale all or part of the Preferred Securities
and the determination of any and all such acts, other than actions which must be
taken by or on behalf of the Trust, and the advice to the Trustees of actions
they must take on behalf of the Trust, and the preparation for execution and
filing of 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) the preparation for filing by the Trust and execution on
behalf of the Trust of 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;
(iv) the preparation for filing by the Trust with the Commission and
the execution on behalf of the Trust of a registration statement on Form 8-A
relating to the registration of the Preferred Securities under Section 12(b) or
12(g) of the Exchange Act, including any amendments thereto;
(v) the negotiation of the terms of, and the execution and delivery
of, the Underwriting Agreement providing for the sale of the Preferred
Securities; and
(vi) the taking of 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 1940 Act, or taxed as a
corporation for United States federal income tax purposes and so that the
Debentures will be treated as indebtedness of the Depositor for United States
federal income tax purposes. In this connection, the Depositor and the
Administrative Trustees are authorized to take any action, not inconsistent with
applicable law, the Certificate of Trust or this Trust Agreement, that each of
the Depositor and the Administrative Trustees determines in their discretion to
be necessary or desirable for such purposes, as long as such action does not
adversely affect in any material respect the interests of the holders of the
Preferred Securities.
SECTION 208. ASSETS OF TRUST. The assets of the Trust shall consist of
the Trust Property.
SECTION 209. 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.
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ARTICLE III
PAYMENT ACCOUNT
SECTION 301. PAYMENT ACCOUNT.
(a) On or prior to the Closing Date, the Property Trustee shall establish
the Payment Account. The Property Trustee and any agent of the Property Trustee
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 Securityholders 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 of 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 401. 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 _____________,
1997, and, except in the event that the Depositor exercises its right to
defer the payment of interest on the Debentures pursuant to the Indenture,
shall be payable quarterly in arrears on the last day of March, June,
September and December of each year, commencing on March 31, 1997. If any
date on which a Distribution is 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 that 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 401(a) a "Distribution Date").
(b) The Trust Securities represent undivided beneficial interests in the
Trust Property, and, the Distributions on the Trust Securities shall be payable
at a rate of ____% per annum of the Liquidation Amount of the Trust Securities.
The amount of Distributions payable for any full period shall be computed on the
basis of a 360-day year of twelve 30-day months. The amount of Distributions
for any partial period shall be computed on the basis of the number of days
elapsed in a 360-day year of twelve 30-day months. The amount of Distributions
payable for any period shall include the Additional Amounts, if any.
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(c) Distributions on the Trust Securities shall be made by the Property
Trustee from the Payment Account and shall be payable on each Distribution Date
only to the extent that the Trust has funds then on hand and 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
one Business Day prior to such Distribution Date; PROVIDED, HOWEVER, that in the
event that the Preferred Securities do not remain in book-entry-only form, the
relevant record date shall be the date 15 days prior to the relevant
Distribution Date.
SECTION 402. REDEMPTION.
(a) On each Debenture Redemption Date and on the stated maturity of the
Debentures, the Trust will be required to redeem a Like Amount of Trust
Securities at the Redemption Price.
(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 shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(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 will become due
and payable upon each such Trust Security to be redeemed and that distributions
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 with the proceeds from the contemporaneous
redemption of Debentures. Redemptions of the Trust Securities shall be made and
the Redemption Price shall be payable on each Redemption Date only to the extent
that the Trust has funds then on hand and available in the Payment Account for
the payment of such Redemption Price.
(d) If the Property Trustee gives a notice of redemption in respect of any
Preferred Securities, then, by 12:00 noon, New York City time, on the Redemption
Date, subject to Section 402(c), the Property Trustee will, so long as the
Preferred Securities are in book-entry-only form, irrevocably deposit with the
Clearing Agency for the Preferred Securities funds sufficient to pay the
applicable Redemption Price and will give such Clearing Agency irrevocable
instructions and authority to pay the Redemption Price to the holders thereof.
If the Preferred Securities are no longer
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in book-entry-only form, the Property Trustee, subject to Section 402(c), will
irrevocably deposit with the Paying Agent funds sufficient to pay the applicable
Redemption Price and will give the Paying Agent irrevocable instructions and
authority to pay the Redemption Price 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 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 upon the
date of such deposit, all rights of Securityholders holding Trust Securities so
called for redemption will cease, except the right of such Securityholders to
receive the Redemption Price and any Distribution payable on or prior to the
Redemption Date, but without interest, and such Securities will cease to be
outstanding. In the event that any date on which any Redemption Price is payable
is not a Business Day, then payment of the Redemption Price payable on such date
will be made on the next succeeding day that is a Business Day (and without any
interest or other payment in respect of any such delay), except that, if such
Business Day falls in the next calendar year, such payment will be made on the
immediately preceding Business Day, in each case, with the same force and effect
as if made on such date. In the event that payment of the Redemption Price 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 is
actually paid, in which case the actual payment date will be the date fixed for
redemption for purposes of calculating the Redemption Price.
(e) Payment of the Redemption Price on the Trust Securities shall be made
to the recordholders thereof as they appear on the Securities Register for the
Trust Securities on the relevant record date, which shall be one Business Day
prior to the relevant Redemption Date; PROVIDED, HOWEVER, that in the event that
the Preferred Securities do not remain in book-entry-only form, the relevant
record date shall be the date fifteen days prior to the relevant Redemption
Date.
(f) Subject to Section 403(a), 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 on a
pro rata basis (based on Liquidation Amounts) among the Common Securities and
the Preferred Securities. The particular Preferred Securities to be redeemed
shall be selected on a pro rata basis (based upon Liquidation Amounts) 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 (including, without limitation, by lot) as the Property Trustee shall
deem fair and appropriate and which may provide for the selection for redemption
of portions (equal to $25 or an integral multiple of $25 in excess thereof) of
the Liquidation Amount of Preferred Securities of a denomination larger than
$25. 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 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 that has been or is to be redeemed.
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SECTION 403. SUBORDINATION OF COMMON SECURITIES.
(a) Payment of Distributions (including Additional Amounts, if applicable)
on, and the Redemption Price of, the Trust Securities, as applicable, shall be
made, subject to Section 402(f), pro rata among the Common Securities and the
Preferred Securities based on the Liquidation Amount of the Trust Securities;
provided, however, that if on any Distribution Date or Redemption Date any Event
of Default resulting from 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 the full amount
of such Redemption Price 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 the
Redemption Price 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 right to act with respect to 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 Event of Default under this 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 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 404. PAYMENT PROCEDURES. Payments of Distributions (including
Additional Amounts, if applicable) 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 Clearing Agency, such Distributions shall be made to
the Clearing Agency in immediately available funds, which shall credit the
relevant Persons' accounts at such Clearing Agency 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 Property Trustee and
the Common Securityholder.
SECTION 405. TAX RETURNS AND REPORTS. The Administrative Trustees shall
prepare (or cause to be prepared), at the Depositor's expense, 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
and filed) the appropriate Internal Revenue Service 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
appropriate Internal Revenue Service form required to be furnished to such
Securityholder 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 and reports
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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.
Section 406. PAYMENT OF TAXES, DUTIES, ETC. OF THE TRUST. Upon receipt
under the Debentures of Additional Sums, the Property Trustee shall promptly pay
any taxes, duties or governmental charges of whatsoever nature (other than
withholding taxes) imposed on the Trust by the United States or any other taxing
authority.
Section 407. PAYMENTS UNDER INDENTURE. Any amount payable hereunder to
any Holder of Preferred Securities (and any Owner with respect thereto) shall be
reduced by the amount of any corresponding payment such Holder (and Owner) has
directly received pursuant to Section 508 of the Indenture.
ARTICLE V
TRUST SECURITIES CERTIFICATES
Section 501. INITIAL OWNERSHIP. Upon the formation of the Trust and the
contribution by the Depositor pursuant to Section 203 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 502. THE TRUST SECURITIES CERTIFICATES. The Preferred Securities
Certificates shall be issued in minimum denominations of $25 Liquidation Amount
and integral multiples of $25 in excess thereof, and the Common Securities
Certificates shall be issued in denominations of $25 Liquidation Amount and
integral multiples thereof. The Trust Securities Certificates shall be executed
on behalf of the Trust by manual signature of at least one Administrative
Trustee. 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, 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 Sections 504, 511 and 513.
Section 503. EXECUTION AND DELIVERY OF TRUST SECURITIES CERTIFICATES. At
each Time of Delivery, the Administrative Trustees shall cause Trust Securities
Certificates, in an aggregate Liquidation Amount as provided in Sections 204 and
205, to be executed on behalf of the Trust and delivered to or upon the written
order of the Depositor, signed by its chairman of the board, its president, any
executive vice president, senior vice president or any vice president, treasurer
or assistant treasurer or controller without further corporate action by the
Depositor, in authorized denominations.
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Section 504. REGISTRATION OF TRANSFER AND EXCHANGE OF PREFERRED
SECURITIES CERTIFICATES. The Depositor shall keep or cause to be kept, at the
office or Agency maintained pursuant to Section 508, a register or registers for
the purpose of registering Trust Securities Certificates and transfers and
exchanges of Preferred Securities Certificates (the "Securities Register") in
which, the registrar designated by the Depositor (the "Securities Registrar"),
subject to such reasonable regulations as it may prescribe, shall provide for
the registration of Preferred Securities Certificates and Common Securities
Certificates (subject to Section 510 in the case of the Common Securities
Certificates) and registration of transfers and exchanges of Preferred
Securities Certificates as herein provided. The Bank shall be the initial
Securities Registrar.
Upon surrender for registration of transfer of any Preferred Securities
Certificate at the office or Agency maintained pursuant to Section 508, the
Administrative Trustees or any one of them shall execute 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 dated the date of execution by such Administrative Trustee
or Trustees. The Securities Registrar shall not be required to register the
transfer of any Preferred Securities that have been called for redemption. 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 508.
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 Property Trustee and the
Securities Registrar duly executed by the Holder or his attorney duly authorized
in writing. Each Preferred Securities Certificate surrendered for
registration of transfer or exchange shall be cancelled and subsequently
disposed of by the Property Trustee in accordance with its customary practice.
No service charge shall be made for any registration of transfer or
exchange of Preferred Securities Certificates, but the Securities Registrar 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 505. MUTILATED, DESTROYED, LOST OR STOLEN TRUST SECURITIES
CERTIFICATES. If (a) any mutilated Trust Securities Certificate shall be
surrendered to the Securities Registrar, or if the Securities Registrar 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 Securities
Registrar and the Administrative Trustees such security or indemnity as may be
required by them to save each of them 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 and 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 Securities Registrar may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection
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therewith. Any duplicate Trust Securities Certificate issued pursuant to this
Section shall constitute conclusive evidence of an undivided beneficial interest
in the assets of the Trust, as if originally issued, whether or not the lost,
stolen or destroyed Trust Securities Certificate shall be found at any time.
SECTION 506. PERSONS DEEMED SECURITYHOLDERS. The Administrative Trustees
or the Securities Registrar shall 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 Trustees
nor the Securities Registrar shall be bound by any notice to the contrary.
SECTION 507. ACCESS TO LIST OF SECURITYHOLDERS' NAMES AND ADDRESSES. The
Administrative Trustees or the Depositor shall furnish or cause to be furnished
(a) to the Property Trustee, semi-annually on or before January 15 and July 15
in each year, a list, in such form as the Property Trustee may reasonably
require, of the names and addresses of the Securityholders as of the most
recent Record Date and (b) to the Property Trustee, promptly after receipt by
any Administrative Trustee or the Depositor of a request therefor from the
Property Trustee in order to enable the Property Trustee to discharge its
obligations under this Trust Agreement, in each case to the extent such
information is in the possession or control of the Administrative Trustees or
the Depositor and is not identical to a previously supplied list or has not
otherwise been received by the Property Trustee in its capacity as Securities
Registrar. The rights of Securityholders to communicate with other
Securityholders with respect to their rights under this Trust Agreement or under
the Trust Securities, and the corresponding rights of the Trustee shall be as
provided in the Trust Indenture Act. Each Holder, by receiving and holding a
Trust Securities Certificate, and each Owner shall be deemed to have agreed not
to hold the Depositor, the Property Trustee 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 508. MAINTENANCE OF OFFICE OR AGENCY. The Administrative
Trustees shall maintain 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 Trustees in
respect of the Trust Securities Certificates may be served. The Administrative
Trustees initially designate Nevada Power Company, 6226 West Sahara Avenue, Las
Vegas, Nevada 89102, Attention: Treasurer, as the office for such purposes. The
Administrative Trustees shall give prompt written notice to the Depositor and to
the Securityholders of any change in the location of the Securities Register or
any such office or Agency.
SECTION 509. 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 Property Trustee and the Administrative
Trustees. 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 Administrative Trustees may revoke such power and remove the Paying
Agent if such Trustees determine in their sole discretion that the Paying Agent
shall have failed to perform its obligations under this Trust Agreement in any
material respect. The Paying Agent shall initially be the Bank, and any
co-paying agent chosen by the Bank and acceptable to the Administrative Trustees
and the Depositor. Any Person acting as Paying Agent shall be permitted
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to resign as Paying Agent upon 30 days' written notice to the Administrative
Trustees, the Property Trustee and the Depositor. In the event that the Bank
shall no longer be the Paying Agent or a successor Paying Agent shall resign or
its authority to act be revoked, the Administrative Trustees shall appoint a
successor that is acceptable to the Property Trustee and the Depositor to act as
Paying Agent (which shall be a bank or trust company). 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 removal of a
Paying Agent such Paying Agent shall also return all funds in its possession to
the Property Trustee. The provisions of Sections 801, 803 and 806 shall apply
to the Bank also in its role as Paying Agent, for so long as the Bank shall act
as Paying Agent and, to the extent applicable, to any other paying agent
appointed hereunder. Any reference in this Agreement to the Paying Agent shall
include any co-paying agent unless the context requires otherwise.
SECTION 510. OWNERSHIP OF COMMON SECURITIES BY DEPOSITOR. At each Time
of Delivery, the Depositor shall acquire and retain beneficial and record
ownership of the Common Securities. To the fullest extent permitted by law,
other than a transfer in connection with a consolidation or merger of the
Depositor into another corporation, or any conveyance, transfer or lease by the
Depositor of its properties and assets substantially as an entirety to any
Person, pursuant to Section 801 of the Indenture, 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".
SECTION 511. BOOK-ENTRY PREFERRED SECURITIES CERTIFICATES; COMMON
SECURITIES CERTIFICATE. (a) The Preferred Securities Certificates, upon
original issuance, will be issued in the form of a typewritten Preferred
Securities Certificate or Certificates representing Book-Entry Preferred
Securities Certificates, to be delivered to The Depository Trust Company, the
initial Clearing Agency, by, or on behalf of, the Trust. Such Preferred
Securities Certificate or Certificates shall initially be registered on the
Securities Register in the name of Cede & Co., the nominee of the initial
Clearing Agency, and no beneficial owner will receive a Definitive Preferred
Securities Certificate representing such beneficial owner's interest in such
Preferred Securities, except as provided in Section 513. Unless and until
Definitive Preferred Securities Certificates have been issued to beneficial
owners pursuant to Section 513:
(i) the provisions of this Section 511(a) shall be in full force and
effect;
(ii) the Securities Registrar and the Trustees shall be entitled to
deal with the Clearing Agency for all purposes of this Trust Agreement
relating to the Book-Entry Preferred Securities Certificates (including the
payment of the Liquidation Amount of and Distributions on the Book-Entry
Preferred Securities and the giving of instructions or directions to Owners
of Book-Entry Preferred Securities) as the sole Holder of Book-Entry
Preferred Securities and shall have no obligations to the Owners thereof;
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(iii) to the extent that the provisions of this Section 511
conflict with any other provisions of this Trust Agreement, the provisions
of this Section 511 shall control; and
(iv) the rights of the Owners of the Book-Entry Preferred Securities
Certificates shall be exercised only through the Clearing Agency and shall
be limited to those established by law and agreements between such Owners
and the Clearing Agency and/or the Clearing Agency Participants. Pursuant
to the Certificate Depository Agreement, unless and until Definitive
Preferred Securities Certificates are issued pursuant to Section 513, the
initial Clearing Agency will make book-entry transfers among the Clearing
Agency Participants and receive and transmit payments on the Preferred
Securities to such Clearing Agency Participants.
(b) A single Common Securities Certificate representing the Common
Securities shall be issued to the Depositor in the form of a definitive Common
Securities Certificate.
SECTION 512. NOTICES TO CLEARING AGENCY. To the extent that a notice or
other communication to the Owners is required under this Trust Agreement, unless
and until Definitive Preferred Securities Certificates shall have been issued to
Owners pursuant to Section 513, the Trustees shall give all such notices and
communications specified herein to be given to Owners to the Clearing Agency,
and shall have no obligations to the Owners.
SECTION 513. DEFINITIVE PREFERRED SECURITIES CERTIFICATES. If (a) the
Depositor advises the Trustees in writing that the Clearing Agency is no longer
willing or able to properly discharge its responsibilities with respect to the
Preferred Securities Certificates, and the Depositor is unable to locate a
qualified successor, (b) the Depositor at its option advises the Trustees in
writing that it elects to terminate the book-entry system through the Clearing
Agency, or (c) after the occurrence of a Debenture Event of Default, Owners of
Preferred Securities Certificates representing beneficial interests aggregating
at least a majority of the Liquidation Amount advise the Property Trustee in
writing that the continuation of a book-entry system through the Clearing Agency
is no longer in the best interest of the Owners of Preferred Securities
Certificates, then the Property Trustee shall notify the Clearing Agency and the
Clearing Agency shall notify all Owners of Preferred Securities Certificates and
the other Trustees of the occurrence of any such event and of the availability
of the Definitive Preferred Securities Certificates to Owners of such class or
classes, as applicable, requesting the same. Upon surrender to the Property
Trustee of the typewritten Preferred Securities Certificate or Certificates
representing the Book-Entry Preferred Securities Certificates by the Clearing
Agency, accompanied by registration instructions, the Administrative Trustees,
or any one of them, shall execute the Definitive Preferred Securities
Certificates in accordance with the instructions of the Clearing Agency.
Neither the Securities Registrar nor the 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. Upon the issuance of Definitive
Preferred Securities Certificates, the Trustees shall recognize the Holders of
the Definitive Preferred Securities Certificates as Securityholders. The
Definitive Preferred Securities Certificates shall be 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.
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SECTION 514. RIGHTS OF SECURITYHOLDERS.
(a) The legal title to the Trust Property is vested exclusively in the
Property Trustee (in its capacity as such) in accordance with Section 209, and
the Securityholders shall not have any right or title therein other than the
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 Trust
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 by the Trust. The Holders of the Trust
Securities, in their capacities as such, shall 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.
(b) For so long as any Preferred Securities remain Outstanding, if, upon a
Debenture Event of Default, the Debenture Trustee fails or the holders of not
less than 25% in principal amount of the outstanding Debentures fail to declare
the principal of all of the Debentures to be immediately due and payable, the
Holders of at least 25% in Liquidation Amount of the Preferred Securities then
Outstanding shall have such right by a notice in writing to the Depositor and
the Debenture Trustee; and upon any such declaration such principal amount of
and the accrued interest on all of the Debentures shall become immediately due
and payable, provided that the payment of principal and interest on such
Debentures shall remain subordinated to the extent provided in the Indenture.
(c) For so long as any Preferred Securities remain Outstanding, to the
fullest extent permitted by law and subject to the terms of this Trust
Agreement, if, upon a Debenture Event of Default specified in Section 501(1) or
501(2) of the Indenture, any Holder of Preferred Securities shall have the right
to directly institute a proceeding for enforcement of payment to such Holder of
the principal amount of or interest on the Debentures having a principal amount
equal to the Liquidation Amount of the Preferred Securities of such Holder (a
"Direct Action"). In connection with such Direct Action, the rights of the
Holders of the Common Securities will be subrogated to the rights of any Holder
of the Preferred Securities to the extent of any payment made by the Depositor
to such Holder of Preferred Securities in such Direct Action. Except as set
forth in this Section 514(c), the Holders of Preferred Securities will not be
able to exercise directly any other remedy available to the holders of the
Debentures or assert directly any other rights in respect of the Debentures.
ARTICLE VI
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
SECTION 601. LIMITATIONS ON VOTING RIGHTS.
(a) Except as provided in this Section, in Sections 810 and 1002 and in
the Indenture and as otherwise required by law, no Holder of Preferred
Securities shall have any right to vote or in any
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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.
(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 waiveable under Section 513 of
the 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 Indenture or the
Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of at least a majority in
Liquidation Amount of all Outstanding Preferred Securities; provided, however,
that where a consent under the Indenture would require the consent of each
Holder of Debentures affected thereby, no such consent shall be given by the
Property 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 Holders of Preferred Securities, except by a
subsequent vote of the Holders of 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 Trustees shall, at
the expense of the Depositor, obtain an Opinion of Counsel experienced in such
matters to the effect that the Trust will not be classified 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 adversely affect
in any material respect 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 a majority 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 be
classified as an association taxable as a corporation for United States federal
income tax purposes.
SECTION 602. NOTICE OF MEETINGS. Notice of all meetings of the Preferred
Securityholders, stating the time, place and purpose of the meeting, shall be
given by the Property Trustee pursuant to Section 1008 to each Preferred
Securityholder of record, 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 603. MEETINGS OF PREFERRED SECURITYHOLDERS. No annual meeting of
Securityholders is required to be held. The Administrative Trustees, however,
shall call a meeting
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of Securityholders to vote on any matter upon the written request of the
Preferred Securityholders of record of 25% of the Preferred Securities (based
upon their Liquidation Amount) and the Administrative Trustees or the Property
Trustee may, at any time in their discretion, call a meeting of Preferred
Securityholders to vote on any matters as to which Preferred Securityholders are
entitled to vote.
Preferred Securityholders of record of 50% of the Outstanding Preferred
Securities (based upon their 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 Preferred
Securityholders of record present, in person or by proxy, holding more than a
majority of the Preferred Securities (based upon their Liquidation Amount) held
by the Preferred Securityholders of record present, either in person or by
proxy, at such meeting shall constitute the action of the Securityholders,
unless this Trust Agreement requires a greater number of affirmative votes.
SECTION 604. 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 605. 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. Pursuant to a resolution of the
Property Trustee, proxies may be solicited in the name of the Property Trustee
or one or more officers of the Property Trustee. 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, and the burden of proving invalidity shall rest on the
challenger. No proxy shall be valid more than three years after its date of
execution.
SECTION 606. 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
(based upon their Liquidation Amount) 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.
SECTION 607. 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
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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 a
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 608. 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
or Owners may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Securityholders or Owners 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 an Administrative Trustee. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Securityholders or Owners 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 801) 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
acknowledgments of deeds, certifying that the individual signing such
instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which any Trustee receiving the same 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 the Securityholders and the
Administrative Trustees or among such Securityholders or 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.
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A Securityholder may institute a legal proceeding directly against the
Depositor under the Guarantee to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Guarantee Trustee (as defined
in the Guarantee), the Trust or any person or entity.
SECTION 609. INSPECTION OF RECORDS. Upon reasonable notice to the
Administrative Trustees and the Property Trustee, the 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
SECTION 701. REPRESENTATIONS AND WARRANTIES OF THE BANK, THE PROPERTY
TRUSTEE AND THE DELAWARE TRUSTEE. The Bank, the Property Trustee and the
Delaware Trustee, each severally on behalf of and as to itself, hereby
represents and warrants for the benefit of the Depositor and the
Securityholders that:
(a) the Delaware Trustee represents and warrants that (i) it is a
Delaware trust company duly organized, validly existing and in good
standing under the laws of the State of Delaware;
(ii) it 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;
(iii) this Trust Agreement has been duly authorized, executed and
delivered by the Bank 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;
(iv) the execution, delivery and performance by the Delaware Trustee
of this Trust Agreement has been duly authorized by all necessary corporate
or other action on the part of Delaware Trustee and does not require any
approval of stockholders of the Delaware Trustee and such execution,
delivery and performance will not (A) violate the Delaware Trustee's
charter or by-laws, (B) violate any provision of, or constitute, with or
without notice or lapse of time, a default under, or result in the creation
or imposition of, any Lien on any properties included in the Trust Property
pursuant to the provisions of, any indenture, mortgage, credit agreement,
license or other agreement or instrument to which the Delaware Trustee is
a party or by which it is bound, or (C) violate any law, governmental rule
or regulation of the United States or the State of Delaware, as the case
may be, governing the banking or trust powers of the
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Delaware Trustee (as appropriate in context) or any order, judgment or
decree applicable to the Delaware Trustee;
(v) 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 or therein
requires 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 law governing
the banking or trust powers of the Delaware Trustee, as the case may be,
under the laws of the United States or the State of Delaware;
(vi) there are no proceedings pending or, to the best of the Delaware
Trustee's knowledge, threatened against or affecting the the Delaware
Trustee in any court or before any governmental authority, agency or
arbitration board or tribunal which, individually or in the aggregate,
would materially and adversely affect the Trust or would question the
right, power and authority of the Delaware Trustee, to enter into or
perform its obligations as one of the Trustees under this Trust Agreement.
(b) The Bank and the Property Trustee each represents and warrants
that:
(i) the Bank is a Delaware banking corporation duly organized,
validly existing and in good standing under the laws of the State of
Delaware;
(ii) the Bank 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;
(iii) this Trust Agreement has been duly authorized, executed and
delivered by the Bank and constitutes the valid and legally binding
agreement of the Bank 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;
(iv) the execution, delivery and performance by the Bank of this Trust
Agreement has been duly authorized by all necessary corporate or other
action on the part of the Bank and the Property Trustee and does not require
any approval of stockholders of the Bank and such execution, delivery and
performance will not (A) violate the Bank's charter or by-laws, (B) violate
any provision of, or constitute, with or without notice or lapse of time, a
default under, or result in the creation or imposition of, any Lien on any
properties included in the Trust Property pursuant to the provisions of,
any indenture, mortgage, credit agreement, license or other agreement or
instrument to which the Property Trustee or the Bank is a party or by which
it is bound, or (C) violate any law, governmental rule or regulation of the
United States or the State of New York, as the case may be, governing the
banking or trust powers of the Bank or the Property Trustee Delaware Trustee
(as appropriate in context) or any order, judgment or decree applicable to
the Property Trustee or the Bank;
(v) neither the authorization, execution or delivery by the Bank of
this Trust Agreement nor the consummation of any of the transactions by the
Bank or the Property Trustee (as appropriate in context) contemplated herein
or therein requires 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 law governing
the banking or trust powers of the Bank or the Property Trustee, as the case
may be, under the laws of the United States or the State of New York;
(vi) there are no proceedings pending or, to the best of each of the
Bank's and the Property Trustee's knowledge, threatened against or affecting
the Bank or the Property Trustee in any court or before any governmental
authority, agency or arbitration board or tribunal which, individually or
in the aggregate, would materially and adversely affect the Trust or would
question the right, power and authority of the Bank or the Property Trustee,
as the case may be, to enter into or perform its obligations as one of the
Trustees under this Trust Agreement.
SECTION 702. REPRESENTATIONS AND WARRANTIES OF DEPOSITOR. The Depositor
hereby represents and warrants for the benefit of the Securityholders that:
(a) the Trust Securities Certificates issued at each Time of Delivery
on behalf of the Trust have been duly authorized and will have been duly
and validly executed, issued and delivered by the Trustees pursuant to the
terms and provisions of, and in accordance with the requirements of, this
Trust Agreement and the Securityholders will be, as of such date, entitled
to the benefits of this Trust Agreement; and
(b) there are no taxes, fees or other governmental charges payable by
the Trust (or the Trustees on behalf of the Trust) under the laws of the
State of Delaware or any political subdivision thereof in connection with
the execution, delivery and performance by the Bank, the Property Trustee
or the Delaware Trustee, as the case may be, of this Trust Agreement.
ARTICLE VIII
THE TRUSTEES
SECTION 801. 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, by the Trust Indenture Act.
Notwithstanding the foregoing, no provision of this Trust Agreement shall
require the Trustees to expend or risk their own funds or otherwise incur any
financial liability in the performance of any of their duties hereunder, or in
the exercise of any of their rights or powers,
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if they shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not reasonably
assured to it. Whether or not therein expressly so provided, every provision
of this 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. Nothing in this Trust Agreement shall be construed to
release the Property Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct. To the extent
that, at law or in equity, an Administrative Trustee has duties (including
fiduciary duties) and liabilities relating thereto to the Trust or to the
Securityholders, such Administrative Trustee shall not be liable to the Trust
or to any Securityholder for such Trustee's 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 the
Administrative Trustees otherwise existing at law or in equity, are agreed by
the Depositor and the Securityholders to replace such other duties and
liabilities of the Administrative Trustees.
(b) All payments made by the Property Trustee or a Paying Agent in respect
of the Trust Securities shall be made only from the revenue and proceeds from
the Trust Property and only to the extent that there shall be sufficient revenue
or proceeds from the Trust Property to enable the Property Trustee or a 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 revenue and proceeds from the Trust Property to the extent legally
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 801(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) No provision of this Trust Agreement shall be construed to relieve the
Property Trustee from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that:
(i) the Property Trustee shall not be liable for any error of
judgment made in good faith by an authorized officer of the Property
Trustee, unless it shall be proved that the Property Trustee was
negligent in ascertaining the pertinent facts;
(ii) the Property 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 not less than a majority in
Liquidation Amount of the Trust Securities relating to the time, method
and place of conducting any proceeding for any remedy available to the
Property Trustee, or exercising any trust or power conferred upon the
Property Trustee under this Trust Agreement;
(iii) the Property Trustee's sole duty with respect to the custody,
safe keeping and physical preservation of the Debentures and the Payment
Account 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 and the Trust Indenture Act;
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(iv) 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,
and money held by the Property Trustee need not be segregated from other
funds held by it except in relation to the Payment Account maintained by
the Property Trustee pursuant to Section 301 and except to the extent
otherwise required by law; and
(v) 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 802. CERTAIN NOTICES. Within five Business Days after the
occurrence of any Event of Default actually known to the Property Trustee,
the Property Trustee shall transmit, in the manner and to the extent provided
in Section 1008, notice of such Event of Default to the Securityholders, the
Administrative Trustees and the Depositor, unless such Event of Default shall
have been cured or waived.
Within five Business Days after the receipt of notice of the Depositor's
exercise of its right to defer the payment of interest on the Debentures
pursuant to the Indenture, the Administrative Trustee shall transmit, in the
manner and to the extent provided in Section 1008, notice of such exercise to
the Securityholders and the Property Trustee, unless such exercise shall have
been revoked.
SECTION 803. CERTAIN RIGHTS OF PROPERTY TRUSTEE. Subject to the
provisions of Section 801:
(a) 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, consent, order, appraisal, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(b) if (i) in performing its duties under this Trust Agreement the
Property Trustee is required to decide between alternative courses of
action or (ii) in construing any of the provisions of this Trust Agreement
the Property Trustee finds the same ambiguous or inconsistent with any
other provisions contained herein or (iii) 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 and 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
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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;
(c) any direction or act of the Depositor or the Administrative
Trustees contemplated by this Trust Agreement shall be sufficiently
evidenced by an Officers' Certificate;
(d) whenever in the administration of this Trust Agreement, the
Property Trustee shall deem it desirable that a matter be established
before undertaking, suffering or omitting any action hereunder, the
Property 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 Depositor or the Administrative Trustees;
(e) 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 filing under tax or securities laws) or any
rerecording, refiling or reregistration thereof;
(f) the Property Trustee may consult with counsel (which counsel may
be counsel to the Depositor or any of its Affiliates, and may include any
of its employees) and the advice of such 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 and in
accordance with such advice; 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;
(g) 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 and
liabilities which might be incurred by it in compliance with such request
or direction;
(h) 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, consent, order, approval,
bond, debenture, note or other evidence of indebtedness or other paper or
document, unless requested in writing to do so by one or more
Securityholders, but the Property Trustee may make such further inquiry or
investigation into such facts or matters as it may see fit;
(i) 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, provided
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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;
(j) 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 in Liquidation Amount of the Trust
Securities as would be entitled to direct the Property Trustee under the
terms of the Trust Securities in respect of such remedy, right or action,
(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; and
(k) except as otherwise expressly provided by this Trust Agreement,
the Property Trustee shall not be under any obligation to take any action
that is discretionary under the provisions of this Trust Agreement.
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. No
permissive power or authority available to the Property Trustee shall be
construed to be a duty.
SECTION 804. 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 shall not be accountable for
the use or application by the Depositor of the proceeds of the Debentures.
SECTION 805. 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, subject to Sections 808 and 813, may
otherwise deal with the Trust with the same rights it would have if it were not
a Trustee or such other agent.
SECTION 806. COMPENSATION; INDEMNITY; FEES. The Depositor agrees:
(a) to pay to the Trustees from time to time reasonable compensation
for all services rendered by them 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
Trustees upon request for all reasonable expenses, disbursements and
advances incurred or made by the Trustees in accordance with any provision
of this Trust Agreement (including the reasonable
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compensation and the expenses and disbursements of its agents and counsel),
except any such expense, disbursement or advance as may be attributable to
its negligence or bad faith; and
(c) to indemnify each of the Trustees or any predecessor Trustee for,
and to hold the Trustees harmless against, any loss, damage, claims,
liability, penalty or expense incurred without negligence or bad faith on
its part, arising out of or in connection with the acceptance or
administration of this Trust Agreement, including the costs and expenses of
defending itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder.
No Trustee may claim any lien or charge on any Trust Property as a result
of any amount due pursuant to this Section 806.
SECTION 807. CORPORATE PROPERTY TRUSTEE REQUIRED; ELIGIBILITY OF
TRUSTEES.
(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 is
eligible pursuant to the Trust Indenture Act to act as such and has a combined
capital and surplus of at least $50,000,000. If any such Person publishes
reports of condition at least annually, pursuant to law or to the requirements
of its supervising or examining authority, then for the purposes of this
Section, 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.
(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 that
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 and
that otherwise meets the requirements of applicable Delaware law that shall act
through one or more persons authorized to bind such entity.
SECTION 808. 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.
SECTION 809. CO-TRUSTEES AND SEPARATE TRUSTEE. Unless an 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 Administrative Trustees, by agreed action of the
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majority of such Trustees, shall have power to appoint, and upon the written
request of the Administrative Trustees, the Depositor shall for such purpose
join with the Administrative Trustees 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
the extent required by law 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 a Debenture Event of Default has occurred and is continuing, the Property
Trustee alone shall have power to make such appointment. Any co-trustee or
separate trustee appointed pursuant to this Section shall either be (i) a
natural person who is at least 21 years of age and a resident of the United
States or (ii) a legal entity with its principal place of business in the United
States that shall act through one or more persons authorized to bind such
entity.
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:
(a) 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 specified hereunder, shall be
exercised, solely by such Trustees and not by such co-trustee or separate
trustee.
(b) 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.
(c) 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, and, in case a Debenture Event of Default 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
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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 Property Trustee or any
other trustee hereunder.
(e) The Property Trustee shall not be liable by reason of any act of
a co-trustee or separate trustee.
(f) 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 810. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR. No
resignation or removal of any Trustee (the "Relevant 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 811.
Subject to the immediately preceding paragraph, the Relevant Trustee may
resign at any time with respect to the Trust Securities by giving written
notice thereof to the Securityholders. If the instrument of acceptance by the
successor Trustee required by Section 811 shall not have been delivered to the
Relevant Trustee within 30 days after the giving of such notice of
resignation, the Relevant Trustee may petition, at the expense of the Company,
any court of competent jurisdiction for the appointment of a successor Relevant
Trustee with respect to the Trust Securities.
Unless a Debenture Event of Default shall have occurred and be continuing,
any 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
Property Trustee or the Delaware Trustee, or both of them, may be removed at
such time by Act of the Holders of a majority in Liquidation Amount of the
Preferred Securities, delivered to the Relevant Trustee (in its individual
capacity and on behalf of the Trust). An Administrative Trustee may be removed
by the Common Securityholder at any time.
If any Trustee shall resign, be removed or become incapable of acting as
Trustee, or if a vacancy shall occur in the office of any Trustee for any cause,
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 Trustee, shall promptly appoint a successor Trustee or
Trustees with respect to the Trust Securities and the Trust, and the successor
Trustee shall comply with the applicable requirements of Section 811. If the
Property Trustee or the Delaware Trustee shall resign, be removed or become
incapable of continuing to act as the Property Trustee or the Delaware Trustee,
as the case may be, at a time when a Debenture Event of Default shall have
occurred and be continuing, the Preferred Securityholders, by Act of the
Securityholders of a majority in Liquidation Amount of the Preferred Securities
then Outstanding delivered to the retiring Relevant Trustee, shall promptly
appoint a successor Relevant Trustee or Trustees with respect to the Trust
Securities and the Trust, and such successor Trustee shall comply with the
applicable requirements
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of Section 811. If an Administrative Trustee shall resign, be removed or become
incapable of acting as Administrative Trustee, at a time when a Debenture Event
of Default shall have occurred and be continuing, the Common Securityholder,
by Act of the Common Securityholder delivered to the Administrative Trustee,
shall promptly appoint a successor Administrative Trustee or Administrative
Trustees with respect to the Trust Securities and the Trust, and such successor
Administrative Trustee or Administrative Trustees shall comply with the
applicable requirements of Section 811. If no successor Relevant Trustee with
respect to the Trust Securities shall have been so appointed by the Common
Securityholder or the Preferred Securityholders and accepted appointment in the
manner required by Section 811, any Securityholder who has been a Securityholder
of Trust Securities 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 with respect to the Trust
Securities.
The Property Trustee shall give notice of each resignation and each removal
of a Trustee and each appointment of a successor Trustee to all Securityholders
in the manner provided in Section 1008 and shall give notice to the Depositor.
Each notice shall include the name of the successor Relevant Trustee and the
address of its Corporate Trust Office if it is the Property Trustee.
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, in the opinion of the Depositor, incompetent
or incapacitated, the vacancy created by such death, incompetence or incapacity
may be filled by (a) the unanimous act of remaining Administrative Trustees if
there are at least two of them or (b) otherwise by the Depositor (with the
successor in each case being a Person who satisfies the eligibility requirement
for Administrative Trustees set forth in Section 807).
SECTION 811. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR. In case of the
appointment hereunder of a successor Trustee such successor Trustee so appointed
shall execute, acknowledge and deliver to the Trust 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 Depositor or the successor Trustee, such retiring Trustee shall,
upon payment of its charges, execute and deliver an instrument transferring to
such successor Trustee all the rights, powers and trusts of the retiring Trustee
and if the Property Trustee is the resigning Trustee shall duly assign, transfer
and deliver to the successor Trustee all property and money held by such
retiring Property Trustee hereunder.
In case of the appointment hereunder of a successor Relevant Trustee with
respect to the Trust Securities and the Trust, the retiring Relevant Trustee and
each successor Relevant Trustee with respect to the Trust Securities shall
execute and deliver an amendment hereto wherein each successor Relevant
Trustee shall accept such appointment and which (a) 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 (b) 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
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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 with
respect to the Trust Securities and the Trust; but, on request of the Trust or
any successor Relevant Trustee such retiring Relevant Trustee shall duly assign,
transfer and deliver to such successor Relevant 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 Trust 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.
SECTION 812. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any corporation into which the Property Trustee or the Delaware 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 such Relevant
Trustee shall be a party, or any corporation 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 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.
SECTION 813. PREFERENTIAL COLLECTION OF CLAIMS AGAINST DEPOSITOR OR
TRUST. If and when the Property Trustee or the Delaware 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 or the Delaware
Trustee, as the case may be, shall be subject to and shall take all actions
necessary in order to comply with the provisions of the Trust Indenture Act
regarding the collection of claims against the Depositor or Trust (or any such
other obligor).
SECTION 814. REPORTS BY PROPERTY TRUSTEE. (a) Not later than July 15 of
each year commencing with July 15, 1997, the Property Trustee shall transmit to
all Securityholders in accordance with Section 1008, and to the Depositor, a
brief report dated as of such December 31 with respect to:
(i) its eligibility under Section 807 or, in lieu thereof, if to the
best of its knowledge it has continued to be eligible under said Section, a
written statement to such effect;
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(ii) a statement that the Property Trustee has complied with all of
its obligations under this Trust Agreement during the twelve-month period
(or, in the case of the initial report, the period since the Closing Date)
ending with such December 31 or, if the Property Trustee has not complied
in any material respect with such obligations, a description of such
noncompliance; and
(iii) any change in the property and funds in its possession as
Property Trustee since the date of its last report and any action taken by
the Property Trustee in the performance of its duties hereunder which it
has not previously reported and which in its opinion materially affects the
Trust Securities.
(b) In addition, 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.
(c) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Property Trustee with each national securities
exchange, the Nasdaq National Market or such other interdealer quotation system
or self-regulatory organization upon which the Trust Securities are listed or
traded, with the Commission and with the Depositor.
SECTION 815. 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 of
the Trust Indenture Act (if any) and the compliance certificate required by
Section 314(a) 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 816. 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 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 shall be given in the form of an
Officers' Certificate.
SECTION 817. NUMBER OF TRUSTEES. (a) The number of Trustees shall be
four, provided that the Holder of all of the Common Securities by written
instrument may increase or decrease the number of Administrative Trustees. The
Property Trustee and the Delaware Trustee may be the same person.
(b) If a Trustee ceases to hold office for any reason and the number of
Administrative Trustees is not reduced pursuant to Section 817(a), or if the
number of Trustees is increased pursuant to Section 817(a), a vacancy shall
occur. The vacancy shall be filled with a Trustee appointed in accordance
with Section 810.
(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
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number of Administrative Trustees shall occur, until such vacancy is filled by
the appointment of an Administrative Trustee in accordance with Section 810, 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 818. 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 207(a), including any registration
statement or amendment thereto filed with the Commission, or making any other
governmental filing.
(b) The Administrative Trustees shall have power to delegate from time to
time to such of their number or to the Depositor 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.
ARTICLE IX
TERMINATION, LIQUIDATION AND MERGER
SECTION 901. TERMINATION UPON EXPIRATION DATE. Unless earlier
terminated, the Trust shall automatically terminate on ________, ____ (the
"Expiration Date"), following the distribution of the Trust Property in
accordance with Section 904.
SECTION 902. EARLY TERMINATION. The first to occur of any of the
following events is an "Early Termination Event":
(a) the occurrence of a Bankruptcy Event in respect of, or the
dissolution or liquidation of, the Depositor;
(b) the written direction to the Property Trustee from the Depositor
at any time (which direction is optional and wholly within the discretion
of the Depositor) to terminate the Trust and distribute the Debentures in
exchange for the Preferred Securities;
(c) the redemption of all of the Preferred Securities in connection
with the redemption of all of the Debentures; and
(d) the entry of an order for dissolution of the Trust by a court of
competent jurisdiction.
SECTION 903. TERMINATION. The respective obligations and
responsibilities of the Trustees and the Trust created and continued hereby
shall terminate upon the latest to occur of the
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following: (a) the distribution by the Property Trustee to Securityholders upon
the liquidation of the Trust pursuant to Section 904, or upon the redemption of
all of the Trust Securities pursuant to Section 402, of all amounts required
to be distributed hereunder upon the final payment of the Trust Securities; (b)
the payment of any expenses owed by the Trust; and (c) 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 904. LIQUIDATION. (a) If an Early Termination Event specified
in clause (a), (b) or (d) of Section 902 occurs or upon the Expiration Date, the
Trust shall be liquidated by the Trustees as expeditiously as the Trustees
determine to be possible by distributing, after satisfaction of liabilities to
creditors of the Trust as provided by applicable law, to each Securityholder a
Like Amount of Debentures, subject to Section 904(d). Notice of liquidation
shall be given by the Property Trustee 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 904(d) applies receive a Liquidation Distribution, as the
Administrative Trustees or the Property Trustee shall deem appropriate.
(b) Except where Section 902(c) or 904(d) applies, in order to effect the
liquidation of the Trust 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 902(c) or 904(d) 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 certificates to the
Administrative Trustees or their agent for exchange, (iii) the Depositor shall
use its reasonable efforts to have the Debentures listed on the New York Stock
Exchange or on such other stock exchange, interdealer quotation system or
self-regulatory organization as the Preferred Securities are then listed or
traded, (iv) 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 Securities Certificates until such
certificates are so surrendered (and until such certificates are so surrendered,
no payments of interest or principal will be made to holders of Trust Securities
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Certificates with respect to such Debentures), and (v) 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) In the event that, notwithstanding the other provisions of this
Section 904, whether because of an order for dissolution 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 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 the 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, the Preferred Securities shall have a priority
over the Common Securities.
SECTION 905. MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF
THE TRUST. The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except pursuant
to this Section 905. At the request of the Depositor, with the consent of the
Administrative Trustees and without the consent of the holders of the
Preferred Securities, the Trust may merge with or into, consolidate, amalgamate,
or be replaced by or convey, transfer or lease its properties and assets
substantially as an entirety to a trust organized as such under the laws of
any state; provided, that (i) such successor entity either (a) expressly assumes
all of the obligations of the Trust with respect to the Preferred Securities or
(b) substitutes for the Preferred Securities other securities having
substantially the same terms as the Preferred Securities (the "Successor
Securities") so long as the Successor Securities rank the same as the Preferred
Securities rank in priority with respect to distributions and payments upon
liquidation, redemption and otherwise, (ii) the Depositor expressly appoints a
trustee of such successor entity possessing the same powers and duties as the
Property Trustee as the holder of the Debentures, (iii) the Successor Securities
are listed or traded, or any Successor Securities will be listed upon
notification of issuance, on any national securities exchange or other
organization on which the Preferred Securities are then listed or traded, if
any, (iv) such merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease does not cause the Preferred Securities (including any
Successor Securities) to be downgraded by any nationally recognized statistical
rating organization, (v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights, preferences
and privileges of the holders of the Preferred Securities (including any
Successor Securities) in any material respect, (vi) such successor entity has a
purpose identical to that of the Trust, (vii) prior to such merger,
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consolidation, amalgamation, replacement, conveyance, transfer or lease, the
Depositor has received an Opinion of Counsel to the effect that (a) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does
not adversely affect the rights, preferences and privileges of the holders of
the Preferred Securities (including any Successor Securities) in any material
respect, and (b) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Trust nor such successor
entity will be required to register as an investment company under the 1940 Act
and (viii) the Depositor owns all of the Common Securities of such successor
entity and guarantees the obligations of such successor entity under the
Successor Securities at least to the extent provided by the Guarantee.
Notwithstanding the foregoing, the Trust shall not, except with the consent of
holders of 100% in Liquidation Amount of the Preferred Securities,
consolidate, amalgamate, merge with or into, be replaced by or convey, transfer
or lease its properties and assets substantially as an entirety to any other
entity or permit any other entity to consolidate, amalgamate, merge with or
into, or replace it if such consolidation, amalgamation, merger, replacement,
conveyance, transfer or lease would cause the Trust or the successor entity to
be classified as other than a grantor trust for United States federal income tax
purposes.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 1001. LIMITATION OF RIGHTS OF SECURITYHOLDERS. The death or
incapacity of any person having an interest, beneficial or otherwise, in Trust
Securities 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 1002. AMENDMENT. (a) This Trust Agreement may be amended from
time to time by the Trustees and the Depositor, without the consent of any
Securityholders, (i) to cure any ambiguity, correct or supplement any provision
herein which may be inconsistent with any other provision herein, 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 be classified for United States federal income tax purposes as a grantor
trust at all times that any Trust Securities are outstanding or to ensure that
the Trust will not be required to register as an investment company under the
1940 Act; provided, however, that in the case of clause (i), such action shall
not adversely affect in any material respect the interests of any
Securityholder, and any amendments of this Trust Agreement shall become
effective when notice thereof is given to the Securityholders.
(b) Except as provided in Section 1002(c) hereof, any provision of this
Trust Agreement may be amended by the Trustees and the Depositor with (i) the
consent of Securityholders representing not less than a majority (based upon
Liquidation Amounts) of the Trust Securities then Outstanding and (ii) receipt
by the Trustees of an Opinion of Counsel to the effect that such
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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
United States federal income tax purposes or the Trust's exemption from status
of an investment company under the 1940 Act.
(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 603 or 606 hereof), 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; notwithstanding
any other provision herein, without the unanimous consent of the Securityholders
(such consent being obtained in accordance with Section 603 or 606 hereof), this
paragraph (c) of this Section 1002 may not be amended.
(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 1940 Act or fail or cease to be
classified as a grantor trust for United States federal income tax purposes.
(e) Notwithstanding anything in this Trust Agreement to the contrary,
without the consent of the Depositor, this Trust Agreement may not be amended in
a manner which imposes any additional obligation on the Depositor.
(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) Neither the Property Trustee nor the Delaware Trustee shall be
required to enter into any amendment to this Trust Agreement which affects its
own rights, duties or immunities under this Trust Agreement. The Property
Trustee shall be entitled to receive an Opinion of Counsel and an Officers'
Certificate stating that any amendment to this Trust Agreement is in compliance
with this Trust Agreement.
SECTION 1003. 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 1004. 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.
SECTION 1005. PAYMENTS DUE ON NON-BUSINESS DAY. If the date fixed for any
payment on any Trust Security shall be a day that is not a Business Day, then
such payment need not be made on such date but may be made on the next
succeeding day that is a Business Day (except as otherwise
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provided in Sections 401(a) and 402(d)), with the same force and effect as
though made on the date fixed for such payment, and no interest shall accrue
thereon for the period after such date.
SECTION 1006. SUCCESSORS. This Trust Agreement shall be binding upon and
shall inure to the benefit of any successor to the Depositor, the Trust or the
Relevant Trustee, including any successor by operation of law. Except in
connection with a consolidation, merger or sale involving the Depositor that is
permitted under Article Eight of the Indenture and pursuant to which the
assignee agrees in writing to perform the Depositor's obligations hereunder, the
Depositor shall not assign its obligations hereunder.
SECTION 1007. HEADINGS. The Article and Section headings are for
convenience only and shall not affect the construction of this Trust Agreement.
SECTION 1008. REPORTS, NOTICES AND DEMANDS. Any report, 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, first-class
postage prepaid, in the United States mail, hand delivery or facsimile
transmission, in each case, addressed, (a) 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 (b) in the case of the
Common Securityholder or the Depositor, to Nevada Power Company, 1801
Pennsylvania Avenue, N.W., Washington, D.C. 20006, Attention: Treasurer,
facsimile no.: (202) 887-2198. Any notice to Preferred Securityholders shall
also be given to such owners as have, within two years preceding the giving of
such notice, filed their names and addresses with the Property Trustee for that
purpose. 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 or the Administrative Trustees shall be given in
writing addressed (until another address is published by the Trust) as
follows: (a) with respect to the Property Trustee to IBJ Schroder Bank &
Trust Company, One State Street, New York, New York 10004, Attention:
__________________; (b) with respect to the Delaware Trustee, to Delaware
Trust Capital Management, Inc., 900 North Market Street, Second Floor,
Wilmington, Delaware 18901, Attention: Corporate Trust Department; and (c)
with respect to the Administrative Trustees, to them at the address above
for notices to the Depositor, marked "Attention: Administrative Trustees of
NVP 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 1009. AGREEMENT NOT TO PETITION. Each of the Trustees and the
Depositor agree 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, they shall not file, or join in the filing of, a petition against
the Trust under any bankruptcy, insolvency, reorganization 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 1009, the Property Trustee
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agrees, for the benefit of Securityholders, that at the expense of the
Depositor, 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 Trustee
or the Trust may assert. The provisions of this Section 1009 shall survive the
termination of this Trust Agreement.
SECTION 1010. TRUST INDENTURE ACT; CONFLICT WITH TRUST INDENTURE ACT. (a)
This Trust Agreement is subject to the provisions of the Trust Indenture Act
that are required 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 to be included in this Trust Agreement by any
of the provisions of the Trust Indenture Act, such required provision shall
control. If any provision of this Trust Agreement modifies or excludes any
provision of the Trust Indenture Act which may be so modified or excluded, the
latter provision shall be deemed to apply to this Trust Agreement as so modified
or excluded, as the case may be.
(d) The application of the Trust Indenture Act to this Trust Agreement
shall not affect the nature of the Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.
SECTION 1011. ACCEPTANCE OF TERMS OF TRUST AGREEMENT, GUARANTEE AND
INDENTURE. 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
AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND
THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH
SECURITYHOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST
AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND
SUCH SECURITYHOLDER AND SUCH OTHERS.
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NEVADA POWER COMPANY
By: ____________________________________
Name: ____________________________________
Title: ____________________________________
IBJ Schroder Bank & Trust Company
as Property Trustee
By: ____________________________________
Name: ____________________________________
Title: ____________________________________
Delaware Trust Capital Management, Inc.
as Delaware Trustee
By: ____________________________________
Name: ____________________________________
Title: ____________________________________
By: ____________________________________
Richard Hinckley
as Administrative Trustee
By: ____________________________________
Richard C. Schmalz, Jr.
as Administrative Trustee
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EXHIBIT A
CERTIFICATE OF TRUST OF
NVP CAPITAL I
THIS Certificate of Trust of NVP Capital I (the "Trust"), dated as of
__________, 1997, is being duly executed and filed by _______________, a
________ banking corporation, as trustee, to form a business trust under the
Delaware Business Trust Act (12 Del. C. Section 3801 et seq.).
1. Name. The name of the business trust formed hereby is NVP
Capital I.
2. Delaware Trustee. The name and business address of the trustee
of the Trust in the State of Delaware are __________________,
____________________________________, _______________________________.
3. Effective Date. This Certificate of Trust shall be effective
upon filing with the Secretary of State.
IN WITNESS WHEREOF, the undersigned, being the sole trustee of the
Trust, has executed this Certificate of Trust as of the date first above
written.
_______________________________, as trustee
By: ____________________________________
Name: ____________________________________
Title: ____________________________________
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EXHIBIT B
The Depository Trust Company,
55 Water Street, 49th Floor,
New York, New York 10041-0099.
Attention: John C. Drennan
General Counsel's Office
Re: NVP CAPITAL I % CUMULATIVE QUARTERLY INCOME
PREFERRED SECURITIES, SERIES A
Ladies and Gentlemen:
The purpose of this letter is to set forth certain matters relating to
the issuance and deposit with The Depository Trust Company ("DTC") of the NVP
Capital I ____% Cumulative Quarterly Income Preferred Securities, Series A (the
"Preferred Securities"), of NVP Capital I, a Delaware business trust (the
"Issuer"), formed pursuant to a Trust Agreement between Nevada Power Company
("NVP") and ________________________, as Trustee. The payment of distributions
on the Preferred Securities and payments due upon liquidation of Issuer or
redemption of the Preferred Securities, to the extent the Issuer has funds
available for the payment thereof, are guaranteed by NVP to the extent set forth
in a Guarantee Agreement dated ______, 1997 by NVP with respect to the Preferred
Securities. NVP and the Issuer propose to sell the Preferred Securities to
certain Underwriters (the "Underwriters") pursuant to an Underwriting Agreement
dated ______, 1997 by and among the Underwriters, the Issuer and NVP, and the
Underwriters wish to take delivery of the Preferred Securities through DTC.
________________________ is acting as transfer agent and registrar with respect
to the Preferred Securities (the "Transfer Agent and Registrar").
To induce DTC to accept the Preferred Securities as eligible for
deposit at DTC, and to act in accordance with DTC's rules with respect to the
Preferred Securities, the Issuer, the Transfer Agent and Registrar and DTC agree
among each other as follows:
1. Prior to the closing of the sale of the Preferred Securities to
the Underwriters, which is expected to occur on or about ______, 1997, there
shall be deposited with DTC one or more global certificates (individually and
collectively, the "Global Certificate")
registered in the name of DTC's Preferred Securities nominee, Cede & Co.,
representing an aggregate of 5,000,000 Preferred Securities and bearing the
following legend:
Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York
corporation ("DTC"), to Issuer or its agent for registration
of transfer, exchange, or payment, and any certificate
issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative
of DTC (and any payment is made to Cede & Co. or to such
other entity as is requested by an authorized
B-1
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representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein.
2. The Amended and Restated Trust Agreement of the Issuer provides
for the voting by holders of the Preferred Securities under certain limited
circumstances. The Issuer shall establish a record date for such purposes and
shall, to the extent possible, give DTC notice of such record date not less than
15 calendar days in advance of such record date.
3. In the event of a stock split, conversion, recapitalization,
reorganization or any other similar transaction resulting in the cancellation of
all or any part of the Preferred Securities outstanding, the Issuer or the
Transfer Agent and Registrar shall send DTC a notice of such event at least 5
business days prior to the effective date of such event.
4. In the event of distribution on, or an offering or issuance of
rights with respect to, the Preferred Securities outstanding, the Issuer or the
Transfer Agent and Registrar shall send DTC a notice specifying: (a) the amount
of and conditions, if any, applicable to the payment of any such distribution or
any such offering or issuance of rights; (b) any applicable expiration or
deadline date, or any date by which any action on the part of the holders of
Preferred Securities is required; and (c) the date any required notice is to be
mailed by or on behalf of the Issuer to holders of Preferred Securities or
published by or on behalf of the Issuer (whether by mail or publication, the
"Publication Date"). Such notice shall be sent to DTC by a secure means (e.g.,
legible telecopy, registered or certified mail, overnight delivery) in a timely
manner designed to assure that such notice is in DTC's possession no later than
the close of business on the business day before the Publication Date. The
Issuer or the Transfer Agent and Registrar will forward such notice either in a
separate secure transmission for each CUSIP number or in a secure transmission
of multiple CUSIP numbers (if applicable) that includes a manifest or list of
each CUSIP number submitted in that transmission. (The party sending such notice
shall have a method to verify subsequently the use of such means and the
timeliness Of such notice.) The Publication Date shall be not less than 30
calendar days nor more than 60 calendar days prior to the payment of any such
distribution or any such offering or issuance of rights with respect to the
Preferred Securities. After establishing the amount of payment to be made on the
Preferred Securities, the Issuer or the Transfer Agent and Registrar will notify
DTC's Dividend Department of such payment 5 business days prior to payment date.
Notices to DTC's Dividend Department by telecopy shall be sent to (212) 709-
1723. Such notices by mail or by any other means shall be sent to:
Manager, Announcements
Dividend Department
The Depository Trust Company
7 Hanover Square, 23rd Floor
New York, New York 10004-2695
B-2
<PAGE>
The Issuer or the Transfer Agent and Registrar shall confirm DTC's
receipt of such telecopy by telephoning the Dividend Department at (212)
709-1270.
5. In the event of a redemption by the Issuer of the Preferred
Securities, notice specifying the terms of the redemption and the Publication
Date of such notice shall be sent by the Issuer or the Transfer Agent and
Registrar to DTC not less than 30 calendar days prior to such event by a secure
means in the manner set forth in paragraph 4. Such redemption notice shall be
sent to DTC's Call Notification Department at (516) 227-4164 or (516) 227-4190,
and receipt of such notice shall be confirmed by telephoning (516) 227-4070.
Notice by mail or by any other means shall be sent to:
Call Notification Department
The Depository Trust Company
711 Stewart Avenue
Garden City, New York 11530-4719
6. In the event of any invitation to tender the Preferred
Securities, notice specifying the terms of the tender and the Publication Date
of such notice shall be sent by the Issuer or the Transfer Agent and Registrar
to DTC by a secure means and in a timely manner as described in paragraph 4.
Notices to DTC pursuant to this paragraph and notices of other corporate actions
(including mandatory tenders, exchanges and capital changes), shall be sent,
unless notification to another department is expressly provided for herein, by
telecopy to DTC's Reorganization Department at (212) 709-1093 or (212) 709-1094
and receipt of such notice shall be confirmed by telephoning (212) 709-6884, or
by mail or any other means to:
Manager, Reorganization Department
Reorganization Window
The Depository Trust Company
7 Hanover Square, 23rd Floor
New York, New York 10004-2695
7. All notices and payment advices sent to DTC shall contain the
CUSIP number or numbers of the Preferred Securities and the accompanying
designation of the Preferred Securities, which, as of the date of this letter,
is "NVP Capital I ____% Cumulative Quarterly Income Preferred Securities, Series
A".
8. Distribution payments or other cash payments with respect to the
Preferred Securities evidenced by the Global Certificate shall be received by
Cede & Co., as nominee of DTC, or its registered assigns in next day funds on
each payment date (or in accordance with existing arrangements between the
Issuer or the Transfer Agent and Registrar and DTC). Such payments shall be
made payable to the order of Cede & Co., and shall be addressed as follows:
NDFS Redemption Department
The Depository Trust Company
7 Hanover Square, 23rd Floor
New York, New York 10004-2695
B-3
<PAGE>
9. DTC may by prior written notice direct the Issuer and the
Transfer Agent and Registrar to use any other telecopy number or address of DTC
as the number or address to which notices or payments may be sent.
10. In the event of a conversion, redemption, or any other similar
transaction (e.g., tender made and accepted in response to the Issuer's or the
Transfer Agent and Registrar's invitation) necessitating a reduction in the
aggregate number of Preferred Securities outstanding evidenced by the Global
Certificate, DTC, in its discretion: (a) may request the Issuer or the
Transfer Agent and Registrar to issue and countersign a new Global Certificate;
or (b) may make an appropriate notation on the Global Certificate indicating the
date and amount of such reduction.
11. DTC may discontinue its services as a securities depositary with
respect to the Preferred Securities at any time by giving at least 90 days'
prior written notice to the Issuer and the Transfer Agent and Registrar (at
which time DTC will confirm with the Issuer or the Transfer Agent and Registrar
the aggregate number of Preferred Securities deposited with it) and discharging
its responsibilities with respect thereto under applicable law. Under such
circumstances, the Issuer may determine to make alternative arrangements for
book-entry settlement for the Preferred Securities, make available one or more
separate global certificates evidencing Preferred Securities to any Participant
having Preferred Securities credited to its DTC account, or issue definitive
Preferred Securities to the beneficial holders thereof, and in any such case,
DTC agrees to cooperate fully with the Issuer and the Transfer Agent and
Registrar and to return the Global Certificate, duly endorsed for transfer as
directed by the Issuer or the Transfer Agent and Registrar, together with any
other documents of transfer reasonably requested by the Issuer or the Transfer
Agent and Registrar.
12. In the event that the Issuer determines that beneficial owners of
Preferred Securities shall be able to obtain definitive Preferred Securities,
the Issuer or the Transfer Agent and Registrar shall notify DTC of the
availability of certificates. In such event, the Issuer or the Transfer Agent
and Registrar shall issue, transfer and exchange certificates in appropriate
amounts, as required by DTC and others, and DTC agrees to cooperate fully with
the Issuer and the Transfer Agent and Registrar and to return the Global
Certificate, duly endorsed for transfer as directed by the Issuer or the
Transfer Agent and Registrar, together with any other documents of transfer
reasonably requested by the Issuer or the Transfer Agent and Registrar.
13. This letter may be executed in any number of counterparts, each
of which when so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
B-4
<PAGE>
Nothing herein shall be deemed to require the Transfer Agent and
Registrar to advance funds on behalf of NVP Capital I.
Very truly yours,
NVP CAPITAL I
(As Issuer)
By:_____________________________
Administrative Trustee
By______________________________
Name:
Title:
________________________________
(As Transfer Agent and Registrar)
By______________________________
Name:
Title:
RECEIVED AND ACCEPTED:
THE DEPOSITORY TRUST COMPANY
By__________________________
Authorized Officer
B-5
<PAGE>
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE
Certificate Number Number of Common Securities
C-1
Certificate Evidencing Common Securities
of
NVP CAPITAL I
____% Common Securities
(liquidation amount $25 per Common Security)
NVP Capital I, a statutory business trust formed under the laws of the
State of Delaware (the "Trust"), hereby certifies that Nevada Power Company (the
"Holder") is the registered owner of One Hundred Fifty Thousand (150,000) common
securities of the Trust representing undivided beneficial interests in the
assets of the Trust and designated the ___0% Common Securities (liquidation
amount $25 per Common Security) (the "Common Securities"). In accordance with
Section 510 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 ______, 1997 as the same may be amended from time to
time (the "Trust Agreement") including the designation of the terms of the
Common Securities as set forth therein. 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, one of the Administrative Trustees of the Trust
has executed this certificate this ______ day of ________, ____.
NVP CAPITAL I
By___________________________
Name:
Administrative Trustee
C-1
<PAGE>
EXHIBIT D
AGREEMENT AS TO EXPENSES AND LIABILITIES
AGREEMENT dated as of ______________, 1997, between Nevada Power
Company, a Nevada corporation ("NVP"), and NVP 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 NVP and to issue and sell ____%
Cumulative 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
____________, 1997 as the same may be amended from time to time (the "Trust
Agreement");
WHEREAS, NVP will directly or indirectly own all of the Common
Securities of Trust and will issue the Debentures;
NOW, THEREFORE, in consideration of the purchase by each holder of the
Preferred Securities, which purchase NVP hereby agrees shall benefit NVP and
which purchase NVP acknowledges will be made in reliance upon the execution and
delivery of this Agreement, NVP and Trust hereby agree as follows:
ARTICLE I
Section 1.1. GUARANTEE BY NVP.
Subject to the terms and conditions hereof, NVP hereby irrevocably and
unconditionally guarantees to each person or entity to whom the Trust is now or
hereafter becomes indebted or liable (the "Beneficiaries") the full payment,
when and as due, of any and all Obligations (as hereinafter defined) to such
Beneficiaries. As used herein, "Obligations" means any costs, expenses or
liabilities of the Trust, other than 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. 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 1.2. TERM OF AGREEMENT.
This Agreement shall terminate and be of no further force and effect
upon the later of (a) the date on which full payment has been made of all
amounts payable to all holders of all the Preferred Securities (whether upon
redemption, liquidation, exchange or otherwise) and (b) the date on which there
are no Beneficiaries remaining; provided, however, that this Agreement shall
continue
D-1
<PAGE>
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 NVP and IBJ Schroder Bank &
Trust Company as guarantee trustee or under this Agreement for any reason
whatsoever. This Agreement is continuing, irrevocable, unconditional and
absolute.
Section 1.3. WAIVER OF NOTICE.
NVP hereby waives notice of acceptance of this Agreement and of any
Obligation to which it applies or may apply, and NVP hereby waives presentment,
demand for payment, protest, notice of nonpayment, notice of dishonor, notice of
redemption and all other notices and demands.
Section 1.4. NO IMPAIRMENT.
The obligations, covenants, agreements and duties of NVP 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, NVP with respect to the happening of any of the foregoing.
Section 1.5. ENFORCEMENT.
A Beneficiary may enforce this Agreement directly against NVP and NVP
waives any right or remedy to require that any action be brought against the
Trust or any other person or entity before proceeding against NVP.
Section 1.6. SUBROGATION.
NVP shall be subrogated to all (if any) rights of the Trust in respect
of any amounts paid to the Beneficiaries by NVP under this Agreement; provided,
however, that NVP 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
D-2
<PAGE>
agreement, in all cases as a result of payment under this Agreement, if, at the
time of any such payment, any amounts are due and unpaid under this Agreement.
ARTICLE II
Section 2.1. BINDING EFFECT.
All guarantees and agreements contained in this Agreement shall bind
the successors, assigns, receivers, trustees and representatives of NVP and
shall inure to the benefit of the Beneficiaries.
Section 2.2. 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 2.3. 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):
NVP Capital I
c/o __________________
______________________
______________________
Facsimile No.: _______
Nevada Power Company
6226 West Sahara Avenue
Las Vegas, Nevada 89102
Facsimile No.: _________
Attention: _____________
Section 2.4 This agreement shall be governed by and construed and
interpreted in accordance with the laws of the State of New York.
D-3
<PAGE>
THIS AGREEMENT is executed as of the day and year first above written.
NEVADA POWER COMPANY
By: ________________________________
Name:
Title:
NVP CAPITAL I
By: ________________________________
Name:
Administrative Trustee
D-4
<PAGE>
EXHIBIT E
IF THE PREFERRED SECURITY IS TO BE A GLOBAL CERTIFICATE INSERT - This
Preferred Security is a Global Certificate within the meaning of the Trust
Agreement hereinafter referred to and is registered in the name of The
Depository Trust Company (the "Depository") or a nominee of the Depository. This
Preferred Security is exchangeable for Preferred Securities registered in the
name of a person other than the Depository or its nominee only in the limited
circumstances described in the Trust Agreement and no transfer of this Preferred
Security (other than a transfer of this Preferred Security as a whole by the
Depository to a nominee of the Depository or by a nominee of the Depository to
the Depository or another nominee of the Depository) may be registered except in
limited circumstances.
Unless this Preferred Security is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New York) to
NVP Capital I or its agent for registration of transfer, exchange or payment,
and any Preferred Security issued is registered in the name of Cede & Co. or
such other name as requested by an authorized representative of The Depository
Trust Company and any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL inasmuch as
the registered owner hereof, Cede & Co., has an interest herein.
Certificate Number Number of Preferred Securities
P- CUSIP NO.
Certificate Evidencing Preferred Securities
of
NVP Capital I
_____% Cumulative Quarterly Income Preferred Securities,
Series A
(liquidation amount $25 per Preferred Security)
NVP Capital I, a statutory business trust formed 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 NVP Capital I ____% Cumulative Quarterly Income Preferred
Securities, Series A (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 504 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
E-1
<PAGE>
Restated Trust Agreement of the Trust dated as of _____________, 1997, as the
same may be amended from time to time (the "Trust Agreement") including the
designation of the terms of Preferred Securities as set forth therein. The
Holder is entitled to the benefits of the Guarantee Agreement entered into by
Nevada Power Company, a Nevada corporation, and ______________, as guarantee
trustee, dated as of ___________, 1997 (the "Guarantee"), to the extent provided
therein. The Trust will furnish a copy of the Trust Agreement and the Guarantee
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, one of the Administrative Trustees of the Trust
has executed this certificate this ___________ day of __________, ____.
NVP CAPITAL I
By: ______________________________
Name:
Administrative Trustee
E-2
<PAGE>
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)
and irrevocably appoints
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
agent to transfer this Preferred Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.
Date:_____________
Signature:___________________________
(Sign exactly as your name appears on the other side of this Preferred Security
Certificate)
SIGNATURE(S) GUARANTEED:
___________________________________
THE SIGNATURE(S) SHOULD BE GUARANTEED
BY AN ELIGIBLE GUARANTOR INSTITUTION
(BANKS, STOCKBROKERS, SAVINGS AND LOAN
ASSOCIATIONS AND CREDIT UNIONS WITH
MEMBERSHIP IN AN APPROVED SIGNATURE
GUARANTEE MEDALLION PROGRAM), PURSUANT
TO S.E.C. RULE 17Ad-15.
E-3
<PAGE>
________________________________________________________________________________
GUARANTEE AGREEMENT
Between
NEVADA POWER COMPANY
(as Guarantor)
and
_____________________________
(as Trustee)
dated as of
__________________, 1997
________________________________________________________________________________
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS
SECTION 101. Definitions................................................1
ARTICLE II
TRUST INDENTURE ACT
SECTION 201. Trust Indenture Act; Application...........................4
SECTION 202. List of Holders............................................5
SECTION 203. Reports by the Guarantee Trustee...........................5
SECTION 204. Periodic Reports to Guarantee Trustee......................5
SECTION 205. Evidence of Compliance with Conditions Precedent...........5
SECTION 206. Events of Default; Waiver..................................6
SECTION 207. Event of Default; Notice...................................6
SECTION 208. Conflicting Interests......................................6
ARTICLE III
POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE
SECTION 301. Powers and Duties of the Guarantee Trustee.................6
SECTION 302. Certain Rights of Guarantee Trustee.....................8
SECTION 303. Indemnity.................................................10
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 401. Guarantee Trustee; Eligibility............................10
SECTION 402. Appointment, Removal and Resignation of the Guarantee
Trustee...................................................11
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<PAGE>
TABLE OF CONTENTS
(CONTINUED)
PAGE
ARTICLE V
GUARANTEE
SECTION 501. Guarantee.................................................11
SECTION 502. Waiver of Notice and Demand...............................12
SECTION 503. Obligations Not Affected..................................12
SECTION 504. Rights of Holders.........................................13
SECTION 505. Guarantee of Payment......................................13
SECTION 506. Subrogation...............................................13
ARTICLE VI
COVENANTS AND SUBORDINATION
SECTION 601. Subordination.............................................14
SECTION 602. Pari Passu Guarantees.....................................14
ARTICLE VII
TERMINATION
SECTION 701. Termination...............................................14
ARTICLE VIII
MISCELLANEOUS
SECTION 801. Successors and Assigns....................................14
SECTION 802. Amendments................................................15
SECTION 803. Notices...................................................15
SECTION 804. Benefit...................................................16
SECTION 805. Interpretation............................................16
SECTION 806. GOVERNING LAW.............................................17
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<PAGE>
CROSS-REFERENCE TABLE*
Section of Section of
Trust Indenture Act Guarantee
of 1939, as amended Agreement
- --------------------- ---------
310(a) . . . . . . . . . . . . . . . . . . . . . . . . 401(a)
310(b) . . . . . . . . . . . . . . . . . . . . . . . . 401(c), 208
310(c) . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
311(a) . . . . . . . . . . . . . . . . . . . . . . . . 202(b)
311(b) . . . . . . . . . . . . . . . . . . . . . . . . 202(b)
311(c) . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
312(a) . . . . . . . . . . . . . . . . . . . . . . . . 202(a)
312(b) . . . . . . . . . . . . . . . . . . . . . . . . 202(b)
313 . . . . . . . . . . . . . . . . . . . . . . . . . .203
314(a) . . . . . . . . . . . . . . . . . . . . . . . . 204
314(b) . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(c) . . . . . . . . . . . . . . . . . . . . . . . . 205
314(d) . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(e) . . . . . . . . . . . . . . . . . . . . . . . . 101,205, 302
314(f) . . . . . . . . . . . . . . . . . . . . . . . . 201, 302
315(a) . . . . . . . . . . . . . . . . . . . . . . . . 301(d)
315(b) . . . . . . . . . . . . . . . . . . . . . . . . 207
315(c) . . . . . . . . . . . . . . . . . . . . . . . . 301
315(d) . . . . . . . . . . . . . . . . . . . . . . . . 301(d)
316(a) . . . . . . . . . . . . . . . . . . . . . . . . 101,206, 504
316(b) . . . . . . . . . . . . . . . . . . . . . . . . 503
316(c) . . . . . . . . . . . . . . . . . . . . . . . . 802
317(a) . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
317(b) . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
318(a) . . . . . . . . . . . . . . . . . . . . . . . . 201(b)
318(b) . . . . . . . . . . . . . . . . . . . . . . . . 201
318(c) . . . . . . . . . . . . . . . . . . . . . . . . 201(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.
<PAGE>
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT, dated as of ______________, 1997, is
executed and delivered by Nevada Power Company, a _______________ corporation
(the "Guarantor"), and _________________________, a ________________________
organized under the laws of _______________, 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 NVP Capital I, a Delaware
statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Trust Agreement (the
"Trust Agreement"), dated as of _____________, 1997 among the Issuer Trustees
named therein, the Guarantor, as Depositor, and the Holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer is
issuing ______________ of its ____% Cumulative Quarterly Income Preferred
Securities, Series A (liquidation preference $25 per preferred security) (the
"Preferred Securities") representing preferred undivided beneficial interests in
the assets of the Issuer and having the terms set forth in the Trust Agreement;
WHEREAS, the Preferred Securities will be issued by the Issuer and the
proceeds thereof, together with the proceeds from the issuance of the Issuer's
Common Securities (as defined below), will be used to purchase the Debentures
(as defined in the Trust Agreement) of the Guarantor which will be deposited
with __________________, as Property Trustee under the Trust Agreement, as trust
assets; and
WHEREAS, as incentive for the Holders to purchase Preferred Securities
the Guarantor desires irrevocably and unconditionally to agree, to the extent
set forth herein, to pay to the Holders of the Preferred Securities 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 by each Holder of
Preferred Securities, 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 of the Preferred Securities.
ARTICLE I
DEFINITIONS
SECTION 101. 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
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<PAGE>
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, PROVIDED, HOWEVER, that an Affiliate of the
Guarantor shall not be deemed to include the Issuer. 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.
"Debt" means, with respect to any Person, whether recourse is to all
or a portion of the assets of such Person and whether or not contingent, (i)
every obligation of such Person for money borrowed; (ii) every obligation of
such Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v), every capital lease obligation of such Person; and (vi) every
guarantee of or responsibility or liability for, direct or indirect, as obligor
or otherwise (a) any obligation of the types referred to in clauses (i) through
(v) of another Person or (b) the payment of any and all dividends of another
Person.
"Event of Default" means a default by the Guarantor on any of its
payment or other obligations under this Guarantee Agreement; PROVIDED, however,
that, except with respect to a default in payment of any Guarantee Payments, the
Guarantor shall have received notice of default and shall not have cured such
default within 60 days after receipt of such notice.
"Guarantee Payments" means 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 (as defined in the Trust Agreement) required to be paid on the
Preferred Securities, to the extent the Issuer shall have funds on hand
available therefor at such time, (ii) the redemption price, including all
accrued and unpaid Distributions to the date of redemption (the "Redemption
Price"), with respect to the Preferred Securities called for redemption by the
Issuer to the extent the Issuer shall have funds on hand available therefor at
such time, and (iii) upon a voluntary or involuntary termination, winding-up or
liquidation of the Issuer, unless Debentures are distributed to the Holders, the
lesser of (a) the aggregate of the liquidation preference of $25 per Preferred
Security plus accrued and unpaid Distributions on the Preferred Securities to
the date of payment to the extent the Issuer shall have funds on hand available
to make such payment at such time
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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 ________________, 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" means any holder, as registered on the books and records of
the Issuer, of any Preferred Securities; 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, the Guarantee Trustee or any Affiliate of the Guarantor
or the Guarantee Trustee.
"Indenture" means the Junior Subordinated Indenture dated as of
___________, 1997, as supplemented and amended between the Guarantor and
_________________, as trustee.
"List of Holders" has the meaning specified in Section 202 (a) .
"Majority in liquidation preference of the Securities" means, except
as provided by the Trust Indenture Act, a vote by the Holder(s), voting
separately as a class, of more than 50% of the liquidation preference of all
then outstanding Preferred Securities issued by the Issuer.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chairman and Chief Executive Officer, President or a
Vice President, and by the Treasurer, an Assistant Treasurer, the Controller,
the Secretary or an Assistant Secretary of such Person, 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 a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated
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association, or government or any Agency or political subdivision thereof, or
any other entity of whatever nature.
"Responsible Officer" means, with respect to the Guarantee Trustee,
any Senior Vice President, 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.
"Senior Debt" means the principal of (and premium, if any) and
interest, if any (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Guarantor whether
or not such claim for post-petition interest is allowed in such proceeding), on
Debt, whether incurred on or prior to the date of this Guarantee or thereafter
incurred, unless, in the instrument creating or evidencing the same or pursuant
to which the same is outstanding, it is provided that such obligations are not
superior in right of payment to the Guarantee or to other Debt which is pari
passu with, or subordinated to, the Guarantee; PROVIDED, however, that Senior
Debt shall not be deemed to include (a) any Debt of the Guarantor which when
incurred and without respect to any election under Section 1111(b) of the
Bankruptcy Reform Act of 1978, was without recourse to the Guarantor, (b) any
Debt of the Guarantor to any of its Subsidiaries, (c) Debt to any employee of
the Guarantor, (d) any liability for taxes, (e) Debt or other monetary
obligations to trade creditors created or assumed by the Guarantor or any of its
Subsidiaries in the ordinary course of business in connection with the obtaining
of goods, materials or services and (f) Debt issued under the Indenture and (g)
the Guarantee.
"Successor Guarantee Trustee" means a successor Guarantee Trustee
possessing the qualifications to act as Guarantee Trustee under Section 401.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
ARTICLE II
TRUST INDENTURE ACT
SECTION 201. TRUST INDENTURE ACT; APPLICATION.
(a) This Guarantee Agreement is subject to the provisions of the
Trust Indenture Act that are required to be part of this Guarantee
Agreement and shall, to the extent applicable, be governed by such
provisions.
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(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 202. LIST OF HOLDERS.
(a) The Guarantor shall furnish or cause to be furnished to the
Guarantee Trustee (a) semiannually, on or before January 15 and July 15 of
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, in each case to the extent such information is in the possession
or control of the Guarantor and is not identical to a previously supplied
list of Holders or has not otherwise been received by the Guarantee Trustee
in its capacity as such. 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), Section 311(b) and Section 312(b) of the Trust Indenture
Act.
SECTION 203. REPORTS BY THE GUARANTEE TRUSTEE.
Not later than July 15 of each year, commencing July 15, 1997, the
Guarantee Trustee shall provide to the Holders such reports as are required by
Section 313 of the Trust Indenture Act, if any, in the form and in the manner
provided by Section 313 of the Trust Indenture Act. The Guarantee Trustee shall
also comply with the requirements of Section 313(d) of the Trust Indenture Act.
SECTION 204. PERIODIC REPORTS TO GUARANTEE TRUSTEE.
The Guarantor shall provide to the Guarantee Trustee, the Securities
and Exchange Commission and the Holders such documents, reports and information,
if any, as required by Section 314 of the Trust Indenture Act 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 205. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.
The Guarantor shall provide to the Guarantee Trustee such evidence of
compliance with such conditions precedent, if any, provided for in this
Guarantee Agreement that relate to any of the matters set forth in Section
314(c) of the Trust Indenture Act. Any certificate or opinion required to
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be given by an officer pursuant to Section 314(c)(1) may be given in the form of
an Officers' Certificate.
SECTION 206. EVENTS OF DEFAULT; WAIVER.
The Holders of a Majority in liquidation preference of the Preferred
Securities may, on behalf 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 therefrom.
Section 207. 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, except in the case of a default in the payment of a
Guarantee Payment, 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 and/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 208. CONFLICTING INTERESTS.
The Trust Agreement 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 THE GUARANTEE TRUSTEE
SECTION 301. 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 to any Person except a Holder exercising
his or her rights pursuant to Section 504(iv) 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, upon acceptance by such Successor Guarantee Trustee of
its
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appointment hereunder, 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) If an Event of Default has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of
the Holders.
(c) The Guarantee Trustee, before 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 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 206), 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.
(d) 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 or of
the Trust Indenture Act 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
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proved that the Guarantee Trustee 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 not less than a
Majority in liquidation preference 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 302. CERTAIN RIGHTS OF GUARANTEE TRUSTEE.
(a) Subject to the provisions of Section 301:
(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 unless otherwise prescribed herein.
(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 to take
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 from the Guarantee Trustee, shall be promptly
delivered by the Guarantor.
(iv) The Guarantee Trustee may consult with legal counsel, and
the written advice or opinion of such legal counsel with respect to
legal matters shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted to be taken by it
hereunder in good faith and in accordance with such advice
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or opinion. Such legal counsel may be legal counsel to the Guarantor
or any of its Affiliates and may be one 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 302(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, 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 its agents or attorneys, and the Guarantee Trustee shall
not be responsible for any misconduct or negligence on the part of any
such 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 (A) may request
instructions from the Holders, (B) may refrain from enforcing such
remedy or right or taking such other action until such instructions
are received, and (C) shall be protected in acting in accordance with
such instructions.
(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
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obligation. No permissive power or authority available to the Guarantee
Trustee shall be construed to be a duty to act in accordance with such
power and authority.
SECTION 303. INDEMNITY.
The Guarantor agrees to indemnify the Guarantee Trustee for, and to
hold it harmless against, any loss, liability or expense incurred without
negligence or bad faith on the part of the Guarantee Trustee, arising out of or
in connection with the acceptance or 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 of its powers or
duties hereunder. The Guarantee Trustee will not claim or exact any lien or
charge on any Guarantee Payments as a result of Any amount due to it under this
Guarantee Agreement.
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 401. 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 Person that is eligible pursuant to the Trust Indenture
Act to act as such and has a combined capital and surplus of at least
$50,000,000, and shall be a corporation meeting the requirements of
Section 310(c) of the Trust Indenture Act. If such corporation
publishes reports of condition at least annually, pursuant to law or
to the requirements of the supervising or examining authority, then,
for the purposes of this Section and to the extent permitted by the
Trust Indenture Act, the combined capital and surplus of such
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 401(a), the Guarantee Trustee shall immediately
resign in the manner and with the effect set out in Section 402(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.
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SECTION 402. APPOINTMENT, REMOVAL AND RESIGNATION OF THE GUARANTEE
TRUSTEE.
(a) Subject to Section 402(b), 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 hereunder 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 402 within 60 days after
delivery to the Guarantor of an instrument of resignation, the resigning
Guarantee Trustee may petition, at the expense of the Guarantor, 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.
ARTICLE V
GUARANTEE
SECTION 501. GUARANTEE.
The Guarantor irrevocably and unconditionally agrees to pay in full to
the Holders the Guarantee Payments (without duplication of amounts theretofore
paid by or on behalf of 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 502. WAIVER OF NOTICE AND DEMAND.
The Guarantor hereby waives notice of acceptance of the 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
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the Guarantee Trustee, 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 503. OBLIGATIONS NOT AFFECTED.
The obligations, covenants, agreements and duties of the Guarantor
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 (other than an extension of time for payment
of Distributions that results from the extension of any interest payment
period on the Debentures as so provided in the Indenture), 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;
(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 503 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 the
consent of, the Guarantor with respect to the happening of any of the foregoing.
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SECTION 504. 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 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 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 Guarantee Trustee, the Issuer
or any other Person.
SECTION 505. 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 of amounts theretofore
paid by the Issuer) or upon distribution of Debentures to Holders as provided in
the Trust Agreement.
SECTION 506. 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 and shall have the right to waive
payment by the Issuer pursuant to Section 501; 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 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 507. 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 503 hereof.
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ARTICLE VI
COVENANTS AND SUBORDINATION
SECTION 601. SUBORDINATION.
This Guarantee Agreement will constitute an unsecured obligation of the
Guarantor and will rank subordinate and junior in right of' payment to all
Senior Debt of the Guarantor.
SECTION 602. PARI PASSU GUARANTEES.
This Guarantee Agreement shall rank pari passu with any similar Guarantee
Agreements issued by the Guarantor on behalf of the holders of Preferred
Securities issued by NVP Capital II.
ARTICLE VII
TERMINATION
SECTION 701. 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, (ii) the distribution of Debentures to the 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 Preferred Securities or
this Guarantee Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 801. 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 Eight of the
Indenture and pursuant to which the assignee agrees in writing to perform the
Guarantor's obligations hereunder, the Guarantor shall not assign its
obligations hereunder.
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SECTION 802. AMENDMENTS.
Except with respect to any changes which do not adversely affect the
rights of the Holders in any material respect (in which case no consent of the
Holders will be required), this Guarantee Agreement may only be amended with the
prior approval of the Holders of not less than a Majority in liquidation
preference of all the outstanding Preferred Securities. The provisions of
Article VI of the Trust Agreement concerning meetings of the Holders shall apply
to the giving of such approval.
SECTION 803. 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, facsimile number or to the attention of such other Person as
the Guarantor may give notice of to the Holders:
Nevada Power Company
6226 West Sahara Avenue
Las Vegas, Nevada 89102
Facsimile No.: (702) 367-5684
Attention: Treasurer
with a copy to:
Nevada Power Company
6226 West Sahara Avenue
Las Vegas, Nevada 89102
Facsimile No.:
Attention: General Counsel
(b) if given to the Issuer, in care of the Guarantee Trustee, at the
Issuer's (and the Guarantee Trustee's) address set forth below or such
other address, facsimile number or to the attention of such other Person as
the Guarantee Trustee on behalf of the Issuer may give notice to the
Holders:
NVP Capital I c/o Nevada Power Company
6226 West Sahara Avenue
Las Vegas, Nevada 89102
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Facsimile No: (702) 367-5684
Attention: Treasurer
with a copy to:
Facsimile No.:
Attention: Corporate Trust Department
(c) 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 804. BENEFIT.
This Guarantee Agreement is solely for the benefit of the Holders and
is not separately transferable from the Preferred Securities.
SECTION 805. 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 101;
(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;
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(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 806. GOVERNING LAW.
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
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.
NEVADA POWER COMPANY
By: ___________________________________________
Name:
Title:
___________________________, as
Guarantee Trustee
By: ___________________________________________
Name:
Title:
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<PAGE>
______________________________________________________________________________
IBJ SCHRODER BANK & TRUST COMPANY,
as Trustee
SUPPLEMENTAL INDENTURE NO. 1
Dated as of ________________, 1997
$_______________
___________% Junior Subordinated Deferrable Interest Debentures
Series A
______________________________________________________________________________
<PAGE>
NEVADA POWER COMPANY
$____________
_____% Junior Subordinated Deferrable Interest Debentures
Series A
SUPPLEMENTAL INDENTURE NO. 1
SUPPLEMENTAL INDENTURE No. 1, dated as of ________ __, 1997, between
____________________, a Nevada corporation (the "Company"), and IBJ Schroder
Bank & Trust Company, a New York banking corporation, as Trustee (the
"Trustee").
RECITALS
The Company has heretofore executed and delivered to the Trustee a
Junior Subordinated Indenture, dated as of ________ __, 1997 (the "Indenture"),
providing for the issuance from time to time of series of the Company's
Securities.
Section 301 of the Indenture provides for various matters with respect
to any series of Securities issued under the Indenture to be established in an
indenture supplemental to the Indenture.
Section 901(3) of the Indenture provides for the Company and the
Trustee to enter into an indenture supplemental to the Indenture to establish
the form or terms of Securities of any series as provided by Sections 201 and
301 of the Indenture.
For and in consideration of the premises and the issuance of the
series of Securities provided for herein, it is mutually covenanted and agreed,
for the equal and proportionate benefit of the Holders of the Securities of such
series, as follows:
ARTICLE 1
RELATION TO INDENTURE; DEFINITIONS
Section 1.1. This Supplemental Indenture No. 1 constitutes an
integral part of the Indenture.
Section 1.2. For all purposes of this Supplemental Indenture No. 1:
(1) Capitalized terms used herein without definition shall have the
meanings specified in the Indenture or in the Amended and Restated Trust
Agreement, dated as of ________ __, 1997, among the Company, as Depositor, IBJ
Schroder Bank & Trust Company, as Property
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<PAGE>
Trustee, Delaware Trust Capital Management, Inc., as Delaware Trustee, and the
Administrative Trustees named therein, as the case may be;
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this Supplemental
Indenture No. 1; and
(3) The terms "herein", "hereof", "hereunder" and other words of
similar refer to this Supplemental Indenture No. 1.
ARTICLE 2
THE SERIES OF SECURITIES
Section 2.1. Title of the Securities. There shall be a series of
Securities designated the "____% Junior Subordinated Deferrable Interest
Debentures, Series A" (the "Securities").
Section 2.2. Limitation on Aggregate Principal Amount; Date of
Securities. The aggregate principal amount of the Securities shall be limited
to $___________; provided, however, that the authorized aggregate principal
amount of the Securities may be increased above such amount by a Board
Resolution to such effect. Each Security shall be dated the date of its
authentication.
Section 2.3. Principal Payment Date. The principal amount of the
Securities Outstanding (together with any accrued and unpaid interest (including
any Additional Interest) thereon) shall be payable in a single installment on
________ __, 2037; provided, that the Company may (i) change the maturity date
upon the occurrence of an exchange of the Securities for the Preferred
Securities subject to certain conditions set forth in Section 314 of the
Indenture, which changed maturity date shall in no case be earlier than ______
__, 2002 or later than _______ __, 2046 and (ii) extend the maturity date
subject to certain conditions specified in Section 314 of the Indenture, which
extended maturity date shall in no case be later than _______ __, 2046.
Section 2.4. Interest and Interest Rates. The rate of interest on
each Security shall be ____% per annum, accruing from ________ __, 1997 and,
subject to Section 2.5, interest shall be payable, quarterly in arrears, on
March 31, June 30, September 30 and December 31 of each year (each such date, an
"Interest Payment Date"), commencing March 31, 1997. The rate of any Additional
Interest that shall accrue on each Security shall be at the same rate per annum.
The amount of interest payable for any period shall be computed on the basis of
a 360-day year of twelve 30-day months. The amount of interest payable for any
partial period shall be computed on the basis of the number of days elapsed in a
360-day year of twelve 30-day months. In the event that any date on which
interest is payable on a Security is not a Business Day, then a 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 such payment was
originally
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<PAGE>
payable. The interest installment so payable, and punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name such Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest installment,
which, if such Security is a Global Security issued to the Depositary, shall be
the close of business on the Business Day next preceding such Interest Payment
Date. The interest so payable on any Security which is not punctually paid or
duly provided for on any Interest Payment Date shall forthwith cease to be
payable to the Holder on such Regular Record Date and may either be paid to the
Person in whose name such 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 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, the Nasdaq National Market or
other applicable interdealer quotation system or self-regulatory organization on
which the Securities may be listed, and upon such notice as may be required by
such exchange or other self-regulatory organization, all as more fully provided
in the Indenture.
Section 2.5. Extension of Interest Payment Period. (a) The
Company shall have the right, at any time during the term of the Securities,
from time to time, to defer the payment of interest on the Securities for up to
20 consecutive quarters with respect to each deferred period (each, an
"Extension Period"), during which Extension Periods the Company shall have the
right to make partial payments of interest on any Interest Payment Date. At the
end of any such Extension Period the Company shall pay all interest then accrued
and unpaid on the Securities (together with Additional Interest thereon, if any,
at the annual rate of ____%, compounded quarterly, to the extent permitted by
applicable law), provided, that during any such Extension Period, the Company
will not, and will not permit any Subsidiary of the Company to (i) declare or
pay any dividends or distributions or redeem, purchase, acquire or make a
liquidation payment with respect to, any of the Company's outstanding Common
Stock or (ii) make any payment of principal, interest or premium, if any, on or
repay, repurchase or redeem any debt security that ranks pari passu with or
junior in interest to the Securities or make any guarantee payments with respect
to the foregoing (other than (a) dividends or distributions in Common Stock of
the Company, (b) redemptions or purchases of any rights pursuant to the
Company's Preferred Stock Purchase Rights Plan, or any successor to such
Preferred Stock Purchase Rights Plan, and the declaration of a dividend of such
rights or the issuance of Preferred Stock under such plans in the future, (c)
payments under any Nevada Power Guarantee, (d) purchases of Common Stock related
to the issuance of Common Stock under the Company's Stock Purchase and Dividend
Reinvestment Plan or any other benefit plans for its directors, officers or
employees and (e) purchases of Common Stock required to prevent the loss or
secure the renewal or reinstatement of any government license or franchise held
by the Company or any of its Subsidiaries). Prior to the termination of any
such Extension Period, the Company may further extend the interest payment
period, provided that no Extension Period shall exceed 20 consecutive quarters
or extend beyond the Maturity of the Securities. Upon termination of any such
Extension Period and upon the payment of all accrued and unpaid interest and any
Additional Interest then due, the Company may elect to begin 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
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<PAGE>
Company shall give the Holders of the Securities and the Property Trustee, the
Administrative Trustees and the Trustee notice of its election to begin or
continue any such Extension Period at least one Business Day prior to the
earlier of (i) the date the Distributions on the Preferred Securities are
payable or (ii) the date the Administrative Trustees are required to give notice
to any securities exchange, the Nasdaq National Market or other applicable
interdealer quotation system or self-regulatory organization or to holders of
such Preferred Securities of the record date or the date such Distributions are
payable, but in any event not less than one Business Day prior to such record
date. The Trustee shall promptly give notice of the Company's election to begin
or continue any such Extension Period to the holders of the outstanding
Preferred Securities.
Section 2.6. Place of Payment. The Place of Payment where the
Securities may be presented or surrendered for payment, where the Securities may
be surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Securities and the Indenture
may be served shall be the Corporate Trust Office of the Trustee.
Section 2.7. Redemption. At any time on or after ________ __, 2002,
the Company may, at its option, subject to the terms and conditions of Article
Eleven of the Indenture, redeem the Securities in whole at any time or in part
from time to time, without premium or penalty, at a redemption price equal to
100% of the principal amount thereof plus the accrued and unpaid interest,
including Additional Interest, if any, to the date fixed for redemption.
If a Special Event in respect of NVP Capital I shall occur and be
continuing, the Company may, at its option, redeem the Securities within 90 days
of the occurrence of such Special Event, in whole but not in part, subject to
the provisions of Article Eleven of the Indenture. The redemption price for any
Security so redeemed shall be equal to 100% of the principal amount thereof plus
accrued and unpaid interest, including Additional Interest, if any, to the date
fixed for redemption.
Section 2.8. Exchange. At any time, the Company may terminate NVP
Capital I and cause the Securities to be distributed to Holders of the Trust
Securities in liquidation of NVP Capital I.
Section 2.9. Denomination. The Securities shall be in registered
form without coupons and shall be issuable in denominations of $25 and integral
multiples thereof.
Section 2.10. Currency. Principal and interest on the Securities
shall be payable in Dollars.
Section 2.11. Form of Securities. The Securities shall be
substantially in the form attached as Exhibit A hereto.
Section 2.12. Securities Registrar and Paying Agent. The Trustee
shall initially serve as Securities Registrar and Paying Agent.
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<PAGE>
Section 2.13. Sinking Fund Obligations. The Company has no
obligation to redeem or purchase any Securities pursuant to any sinking fund or
analogous requirement or upon the happening of a specified event or at the
option of a Holder thereof.
ARTICLE 3
MISCELLANEOUS PROVISIONS
Section 3.1. The Indenture, as supplemented and amended by this
Supplemental Indenture No. 1, is in all respects hereby adopted, ratified and
confirmed.
Section 3.2. This Supplemental Indenture No. 1 may be executed in
any number of counterparts, each of which shall be an original, but such
counterparts shall together constitute but one and the same instrument.
Section 3.3. THIS SUPPLEMENTAL INDENTURE NO. 1 AND EACH SECURITY
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEVADA AND
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEVADA WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture No. 1 to be duly executed, as of the day and year first written above.
NEVADA POWER COMPANY
By: ___________________________________
Name:
Title:
Attest: _______________________
IBJ SCHRODER BANK & TRUST COMPANY, as
Trustee
By: ___________________________________
Name:
Title:
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<PAGE>
EXHIBIT A
[FORM OF FACE OF SECURITY]
IF THE SECURITY IS TO BE A GLOBAL SECURITY - This Security is a Global
Security within the meaning of the Indenture hereinafter referred to and is
registered in the name of The Depository Trust Company (the "Depository") or a
nominee of the Depository. This Security is exchangeable for Securities
registered in the name of a person other than the Depository or its nominee only
in the limited circumstances described in the Indenture and no transfer of this
Security (other than a transfer of this Security as a whole by the Depository to
a nominee of the Depository or by a nominee of the Depository to the Depository
or another nominee of the Depository) may be registered except in limited
circumstances.
Unless this Security is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York) to Nevada Power Company
or its agent for registration of transfer, exchange or payment, and any Security
issued is registered in the name of Cede & Co. or such other name as requested
by an authorized representative of The Depository Trust Company and any payment
hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY A PERSON IS WRONGFUL inasmuch as the registered owner hereof,
Cede & Co., has an interest herein.
NEVADA POWER COMPANY
____% Junior Subordinated Deferrable Interest Debentures
Series A
No. __________ $_____________ CUSIP ________
NEVADA POWER COMPANY, a corporation organized and existing under the
laws of Nevada (hereinafter called the "Company", which term includes any
successor corporation under the Indenture hereinafter referred to), for value
received, hereby promises to pay to _______________, or registered assigns, the
principal sum of __________________ Dollars on ________ __, 2037; provided, that
the Company may (i) change the maturity date upon the occurrence of an exchange
of the Securities for the Trust Securities subject to certain conditions set
forth in Section 314 of the Indenture, which changed maturity date shall in no
case be earlier than ______ __, 2002 or later than _______ __, 2046 and (ii)
extend the maturity date subject to certain conditions specified in Section 314
of the Indenture, which extended maturity date shall in no case be later than
_______ __, 2046. The Company further promises to pay interest on said
principal sum from ________ __, 1996 or from the most recent interest payment
date (each such date, an "Interest Payment Date") on which interest has been
paid or duly provided for, quarterly (subject to deferral as set forth herein)
in arrears on March 31, June 30, September 30 and December 31 of each year,
commencing March 31, 1997, at the rate of ____% per annum, until the principal
hereof shall have
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<PAGE>
become due and payable, plus Additional Interest, if any, until the principal
hereof is paid or duly provided for or made available for payment and on any
overdue principal and (without duplication and to the extent that payment of
such interest is enforceable under applicable law) on any overdue installment of
interest at the rate of ____% per annum, compounded quarterly. The amount of
interest payable for any period will be computed on the basis of twelve 30-day
months and a 360-day year. The amount of interest payable for any partial
period shall be computed on the basis of the number of days elapsed in a 360-day
year of twelve 30-day months. In the event that any date on which interest is
payable on this Security is not a Business Day, then a 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. A "Business Day" shall mean any day other than (i) a Saturday or
Sunday, (ii) 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 (iii) a day
on which the Corporate Trust Office of the Trustee or the principal office of
the Property Trustee under the Trust Agreement hereinafter referred to for NVP
Capital I, is closed for business. The interest installment so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Indenture, be paid to the Person in whose name this Security (or
one or more Predecessor Securities, as defined in the Indenture) is registered
at the close of business on the Regular Record Date for such interest
installment, which shall be the close of business on the Business Day next
preceding such Interest Payment Date. Any such interest installment not so
punctually paid or duly provided for shall 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 said Indenture.
The Company shall have the right at any time during the term of this
Security, from time to time, to defer the payment of interest on such Security
for up to 20 consecutive quarters with respect to each deferral period (each an
"Extension Period"), during which Extension Periods the Company shall have the
right to make partial payments of interest on any Interest Payment Date, and at
the end of which the Company shall pay all interest then accrued and unpaid
(together with Additional Interest thereon to the extent permitted by applicable
law); provided that during any such Extension Period, the Company will not, and
will not permit any Subsidiary of the Company to (i) declare or pay any
dividends or distributions or redeem, purchase, acquire or make a liquidation
payment with respect to, any of the Company's outstanding Common Stock or (ii)
make any payment of principal, interest or premium, if any, on or repay,
repurchase or redeem any debt security that ranks pari passu with or junior in
interest to this Security or make any guarantee payments with respect to the
foregoing (other than (a) dividends or distributions in Common Stock of the
Company, (b) redemptions or purchases of any rights pursuant to the Company's
Preferred Stock Purchase
A-2
<PAGE>
Rights Plan, or any successor to such Preferred Stock Purchase Rights Plan, and
the declaration of a dividend of such rights or the issuance of Preferred Stock
under such plans in the future, (c) payments under any Nevada Power Guarantee,
(d) purchases of Common Stock related to the issuance of Common Stock under any
of the Company's Stock Purchase and Dividend Reinvestment Plan or any other
benefit plans for its directors, officers or employees and (e) purchases of
Common Stock required to prevent the loss or secure the renewal or reinstatement
of any government license or franchise held by the Company or any of its
Subsidiaries). Prior to the termination of any such Extension Period, the
Company may further extend the interest payment period, provided that no
Extension Period shall exceed 20 consecutive quarters or extend beyond the
Maturity of this Security. Upon the termination of any such Extension Period
and upon the payment of all accrued and unpaid interest and any Additional
Interest then due, the Company may elect to begin 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 shall give the
Holder of this Security and the Trustee notice of its election to begin or
continue an Extension Period at least one Business Day prior to the earlier of
(i) the date the Distributions on the Preferred Securities are payable or (ii)
the date the Administrative Trustees are required to give notice to any
securities exchange, the Nasdaq National Market or other applicable interdealer
quotation system or self-regulatory organization or to holders of such Preferred
Securities of the record date or the date such Distributions are payable, but in
any event not less than one Business Day prior to such record date.
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 United States, 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 payment of
interest may be made (i) by check mailed to the address of the Person entitled
thereto as such address shall appear in the Securities Register or (ii) by wire
transfer in immediately available funds at such place and to such account as may
be designated by the Person entitled thereto as specified in the Securities
Register.
The indebtedness evidenced by this Security is, to the extent provided
in the Indenture, subordinate and subject in right of payments to the prior
payment in full of all Senior Debt, 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 actions as may be
necessary or appropriate to 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, waives all notice of the acceptance of
the subordination provisions contained herein and in the Indenture by each
holder of Senior Debt, whether now outstanding or hereafter incurred, and waives
reliance by each such holder upon said provisions.
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.
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<PAGE>
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 under its corporate seal.
Dated:
NEVADA POWER COMPANY
By:____________________________________
[President or Vice President]
Attest:
_____________________________
[Secretary or Assistant Secretary]
This is one of the Securities referred to in the within mentioned
Indenture.
IBJ SCHRODER BANK & TRUST COMPANY,
as Trustee
By:______________________________
Authorized Officer
[FORM OF REVERSE OF SECURITY]
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 a Junior Subordinated Indenture, dated as of ________ __, 1997
(herein called the "Indenture"), between the Company and IBJ Schroder Bank and
Trust Company, as Trustee (herein called the "Trustee", which term includes any
successor trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Trustee,
the Company 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 $___________.
A-4
<PAGE>
All terms used in this Security that are defined in the Indenture or
in the Amended and Restated Trust Agreement, dated as of ________ __, 1996 (the
"Trust Agreement"), for NVP Capital I among Nevada Power Company, as Depositor,
and the Trustees named therein, shall have the meanings assigned to them in the
Indenture or the Trust Agreement, as the case may be.
On or after ________ __, 2002, the Company may at any time, at its
option, subject to the terms and conditions of Article Eleven of the Indenture,
redeem this Security in whole at any time or in part from time to time, without
premium or penalty, at a redemption price equal to 100% of the principal amount
thereof plus the accrued and unpaid interest, including Additional Interest, if
any, to the date fixed for redemption.
If a Special Event in respect of NVP Capital I shall occur and be
continuing, the Company may, at its option, redeem this Security within 90 days
of the occurrence of such Special Event, in whole but not in part, subject to
the provisions of Section 1107 and the other provisions of Article Eleven of the
Indenture. The redemption price for any Security so redeemed shall be equal to
100% of the principal amount thereof plus accrued and unpaid interest, including
Additional Interest, if any, to the date fixed for redemption.
In the event of redemption of this Security in part only, a new
Security or Securities of this series for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation hereof.
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, with the effect and subject to the
conditions provided in the Indenture.
The Indenture contains provisions for satisfaction, discharge and
defeasance at any time of the entire indebtedness of this Security upon
compliance by the Company with certain conditions set forth in the Indenture.
The Indenture permits, with certain exceptions as therein provided,
the Company and the Trustee at any time to enter into a supplemental indenture
or indentures for the purpose of modifying in any manner the rights and
obligations of the Company and of the Holders of the Securities, with the
consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities of each series to be affected by such supplemental
indenture. The Indenture also contains provisions permitting 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.
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<PAGE>
As provided in and subject to the provisions of the Indenture, if an
Event of Default with respect to Securities of any series at the time
Outstanding occurs and is continuing, then and in every such case the Trustee or
the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series may declare the principal amount (or, if the
Securities of that series are Original Issue Discount Securities, such portion
of the principal amount as may be specified in the terms of that series) of all
the Securities of that series to be due and payable immediately, by a notice in
writing to the Company (and to the Trustee if given by Holders), provided that,
in the case of the Securities of a series issued to an NVP Trust, if upon an
Event of Default, the Trustee or the Holders of not less than 25% in principal
amount of the Outstanding Securities of that series fail to declare the
principal of all the Securities of that series to be immediately due and
payable, the holders of at least 25% in aggregate liquidation amount of the
corresponding series of Preferred Securities then outstanding shall have such
right by a notice in writing to the Company and the Trustee; and upon any such
declaration such principal amount (or specified amount) of and the accrued
interest (including any Additional Interest) on all the Securities of such
series shall become immediately due and payable, provided that the payment of
principal and interest (including any Additional Interest) on such Securities
shall remain subordinated to the extent provided in Article Thirteen of the
Indenture.
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 premium, if any) and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the
Securities Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company maintained under Section 1002 of
the Indenture duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Securities Registrar duly
executed by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities of this series, of authorized denominations
and for the same aggregate principal amount, will be issued to the designated
transferee or transferees. No service charge shall be made for any such
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge payable in
connection therewith.
Prior to due presentment of this 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 this Security is registered as the 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.
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
A-6
<PAGE>
principal amount of Securities of such series of a different authorized
denomination, as requested by the Holder surrendering the same.
The Company and, by its acceptance of this Security or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Security agree that for United States federal, state and local
tax purposes it is intended that this Security constitute indebtedness.
THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEVADA WITHOUT REGARD TO CONFLICTS OF
LAWS PRINCIPLES THEREOF.
A-7
<PAGE>
AGREEMENT AS TO EXPENSES AND LIABILITIES
AGREEMENT dated as of __________, 1997, between Nevada Power Company,
a Nevada corporation ("Nevada Power"), and NVP 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 Nevada Power and to issue and sell
___% Cumulative 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 __________, 1997 as the same may be amended from time to time (the "Trust
Agreement");
WHEREAS, Nevada Power will directly or indirectly own all of the
Common Securities of Trust and will issue the Debentures;
NOW, THEREFORE, in consideration of purchase by each holder of the
Preferred Securities, which purchase Nevada Power hereby agrees shall benefit
Nevada Power and which purchase Nevada Power acknowledges will be made in
reliance upon the execution and delivery of this Agreement, Nevada Power and
Trust hereby agree as follows:
ARTICLE I
Section 1.1 GUARANTEE BY NEVADA POWER.
Subject to the terms and conditions hereof, Nevada Power hereby
irrevocably and unconditionally guarantees to each person or entity to whom the
Trust is now or hereafter becomes indebted or liable (the "Beneficiaries") the
full payment, when and as due, of any and all Obligations (as hereinafter
defined) to such Beneficiaries. As used herein, "Obligations" means any costs,
expenses or liabilities of the Trust, other than 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. 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 1.2 TERM OF AGREEMENT.
This Agreement shall terminate and be of no further force and effect
upon the later of (a) the date on which full payment has been made of all
amounts payable to all holders of all the Preferred Securities (whether upon
redemption, liquidation, exchange or otherwise) and (b) 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 Nevada Power and
<PAGE>
_______________ as guarantee trustee or under this Agreement for any reason
whatsoever. This Agreement is continuing, irrevocable, unconditional and
absolute.
Section 1.3 WAIVER OF NOTICE.
Nevada Power hereby waives notice of acceptance of this Agreement and
of any Obligation to which it applies or may apply, and Nevada Power hereby
waives presentment, demand for payment, protest, notice of nonpayment, notice of
dishonor, notice of redemption and all other notices and demands.
Section 1.4 NO IMPAIRMENT.
The obligations, covenants, agreements and duties of Nevada 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 extention 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, Nevada Power with respect to the happening of any of
the foregoing.
Section 1.5 ENFORCEMENT.
A Beneficiary may enforce this Agreement directly against Nevada Power
and Nevada 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 Nevada Power.
Section 1.6 SUBROGATION.
Nevada Power shall be subrogated to all (if any) rights of the Trust
in respect of any amounts paid to the Beneficiaries by Nevada Power under
this Agreement; PROVIDED, HOWEVER, that
-2-
<PAGE>
Nevada Power 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 Agreement, if, at the time of any such
payment, any amounts are due and unpaid under this Agreement.
ARTICLE II
Section 2.1 BINDING EFFECT.
All guarantees and agreements contained in this Agreement shall bind
the successors, assigns, receivers, trustees and representatives of Nevada Power
and shall inure to the benefit of the Beneficiaries.
Section 2.2 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 2.3 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):
NVP Capital I
c/o
Nevada Power Company
6226 West Sahara Avenue
Las Vegas, NV 89102
Facsimile: (702) 367-5684
Attn: Treasurer
Section 2.4 This agreement shall be governed by and construed and
interpreted in accordance with the laws of the State of New York.
-3-
<PAGE>
THIS AGREEMENT is executed as of the day and year first above written.
NEVADA POWER COMPANY
By:
---------------------------------
Name:
Title:
NVP CAPITAL I
By:
---------------------------------
Name:
-4-
<PAGE>
EXHIBIT 5.01
February 2, 1997
Nevada Power Company
Post Office Box 230
Las Vegas, NV 89151
Ladies and Gentlemen:
We have acted as counsel to you, Nevada Power Company, a Nevada corporation
(the "Company"), in connection with the preparation and filing with the
Securities and Exchange Commission (the "Commission") of a Registration
Statement on Form S-3 (File No. 33-_______), as amended (the "Registration
Statement"), under the Securities Act of 1933, as amended (the "Securities
Act"), relating to the proposed issuance and sale from time to time of up to
$125,000,000 in aggregate principal amount of (i) the Company's Junior
Subordinated Deferrable Interest Debentures (the "Debentures"), each series
of which will be issued pursuant to a Junior Subordinated Indenture (the
"Indenture") to be entered into between the Company and IBJ Schroder, as
Trustee (the "Debenture Trustee"), as such Indenture will be supplemented, in
connection with the issuance of each such series, by a supplemental indenture
creating such series (each, a "Supplemental Indenture" and, collectively, the
"Supplemental Indentures"), (ii) preferred securities (the "Preferred
Securities") of NPV Capital I, and NPV Capital II, each a
<PAGE>
Nevada Power Company
February 2, 1997
Page 2
trust formed under the laws of the State of Delaware (each, an "Issuer" and,
collectively, the "Issuers"), and (iii) the Company's guarantees with respect
to the Preferred Securities (each, a "Guarantee" and, collectively, the
"Guarantees"), each of which Guarantees will be issued pursuant to a
guarantee agreement between the Company and the Trustee thereunder (each, a
"Guarantee Agreement" and, collectively, the "Guarantee Agreements").
Capitalized terms used but not otherwise defined herein shall have the
meanings ascribed to them in the Registration Statement.
We have examined the originals, photocopies or conformed copies of all
such records of the Company and all such agreements, certificates of public
officials, certificates of officers and representatives of the Company and
such other documents as we have deemed relevant and necessary as a basis for
the opinion hereinafter expressed. In such examinations, we have assumed the
genuineness of all signatures on original documents and the conformity to the
originals of all copies submitted to us as conformed copies or photocopies.
As to various questions of fact material to our opinion, we have relied upon
representations, statements or certificates of officers and representatives
of the Company, the Issuers and others. Based on the foregoing, it is our
opinion that:
1. The Debentures, when (i) issued and duly executed and authenticated in
accordance with the terms of (a) the Indenture and (b) the applicable
Supplemental Indenture creating such series of Debentures, in the forms filed
as Exhibits 4.01 and 4.13, respectively, to the Registration Statement (and
assuming the due authorization, execution and delivery of the Indenture and
the applicable Supplemental Indenture by each of the parties thereto), and
(ii) delivered against payment therefor, will be legally issued and will
constitute binding obligations of the Company.
2. The Guarantees, when issued pursuant to the applicable Guarantee
Agreement, in the form filed as Exhibit 4.12 of the Registration Statement
(and assuming the due authorization, execution and delivery of the applicable
Guarantee Agreement by each of the parties thereto), will be legally issued
and will constitute binding obligations of the Company.
<PAGE>
Nevada Power Company
February 2, 1997
Page 3
We consent to the filing of this opinion as an exhibit to the Registration
Statement and to the use of our name under the heading "Legal Opinions" in
the Prospectus forming a part of the Registration Statement. In giving such
consent, we do not thereby concede that we are within the category of persons
whose consent is required under Section 7 of the Securities Act or the rules
and regulations promulgated thereunder.
We are delivering this opinion to the Company, and no person other than
the Company may rely upon it without our prior writtten consent.
Very truly yours,
Best Best & Krieger LLP
<PAGE>
EXHIBIT 5.02
[LETTERHEAD OF RICHARDS, LAYTON & FINGER]
January 31, 1997
NVP Capital I
c/o Nevada Power Company
6226 West Sahara Avenue
Las Vegas, Nevada 89102
Re: NVP Capital I
-------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for Nevada Power Company, a
Nevada corporation (the "Company"), and NVP Capital I, a Delaware business
trust (the "Trust"), in connection with the matters set forth herein. At
your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated January 31, 1997 as
filed with the office of the Secretary of State of the State of Delaware (the
"Secretary of State") on January 31, 1997;
(b) The Trust Agreement of the Trust, dated as of January 31, 1997
among the Company and the trustees of the Trust named therein;
(c) The Registration Statement (the "Registration Statement") on Form
S-3, including a Prospectus and a Prospectus Supplement with respect to the
Trust (collectively, the "Prospectus"), relating to the ___% Cumulative
Quarterly Income Preferred Securities, Series A, of the Trust representing
undivided beneficial interests in the assets of the Trust (each, a "Preferred
Security" and collectively, the "Preferred Securities"), to be filed by the
Company and the Trust with the Securities and Exchange Commission;
<PAGE>
NVP Capital I
January 31, 1997
Page 2
(c) A form of Amended and Restated Trust Agreement for the Trust, to be
entered into between the Company, the trustees of the Trust named therein,
and the holders, from time to time, of the undivided beneficial interests in
the assets of such Trust (the "Declaration"), attached as an exhibit to the
Registration Statement; and
Initially capitalized terms used herein and not otherwise defined are
used as defined in the Declaration.
For purposes of this opinion, we have not reviewed any documents other
than the documents listed in paragraphs (a) through (c) above. In particular,
we have not reviewed any document (other than the documents listed in
paragraphs (a) through (c) above) that is referred to in or incorporated by
reference into the documents reviewed by us. We have assumed that there
exists no provision in any document that we have not reviewed that is
inconsistent with the opinions stated herein. We have conducted no
independent factual investigation of our own but rather have relied solely
upon the foregoing documents, the statements and information set forth
therein and the additional matters recited or assumed herein, all of which we
have assumed to be true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii)
the conformity with the originals of all documents submitted to us as copies
or forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Declaration
constitutes the entire agreement among the parties thereto with respect to
the subject matter thereof, including with respect to the creation, operation
and termination of the Trust, and that the Declaration and the Certificate of
Trust are in full force and effect and have not been amended, (ii) except to
the extent provided in paragraph 1 below, the due organization or due
formation, as the case may be, and valid existence in good standing of each
party to the documents examined by us under the laws of the jurisdiction
governing its organization or formation, (iii) the legal capacity of natural
persons who are parties to the documents examined by us, (iv) that each of
the parties to the documents examined by us has the power and authority to
execute and deliver, and to perform its obligations under, such documents,
(v) the due authorization, execution and delivery by all parties thereto of
all documents examined by us, (vi) the receipt by each Person to whom a
Preferred Security is to be issued by the Trust (collectively, the "Preferred
Security Holders") of a Preferred Security Certificate for such Preferred
Security and the payment for such Preferred Security, in accordance with the
Declaration and the Registration Statement, and (vii) that the Preferred
Securities are issued and sold to the Preferred Security Holders in
accordance with the Declaration and the Registration Statement. We have not
participated in the preparation of the Registration Statement and assume
no responsibility for its contents.
<PAGE>
NVP Capital I
January 31, 1997
Page 3
This opinion is limited to the laws of the State of Delaware (excluding
the securities laws of the State of Delaware), and we have not considered and
express no opinion on the laws of any other jurisdiction, including federal
laws and rules and regulations relating thereto. Our opinions are rendered
only with respect to Delaware laws and rules, regulations and orders
thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such questions of
law and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing as a
business trust under the Business Trust Act.
2. The Preferred Securities will represent valid and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the Trust,
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. We note that the Preferred Security
Holders may be obligated to make payments as set forth in the Declaration.
We consent to the filing of this opinion with the Securities and
Exchange Commission as an exhibit to the Registration Statement. We hereby
consent to the use of our name under the heading "Legal Opinions" in the
Prospectus Supplement and in the Prospectus. In giving the foregoing
consents, we do not thereby admit that we come within the category of persons
whose consent is required under Section 7 of the Securities Act of 1933, as
amended, or the rules and regulations of the Securities and Exchange
Commission thereunder. Except as stated above, without our prior written
consent, this opinion may not be furnished or quoted to, or relied upon by,
any other person for any purpose.
Very truly yours,
/s/ Richards, Layton & Finger
EAM/sek
<PAGE>
EXHIBIT 8.01
JONES, DAY, REAVIS & POGUE
77 West Wacker
Chicago, Illinois 60601-1692
February __, 1997
Nevada Power Company
6226 West Sahara Avenue
Las Vegas, Nevada 89102
NVP Capital I
c/o Nevada Power Company
6226 West Sahara Avenue
Las Vegas, Nevada 89102
Ladies and Gentlemen:
We have acted as special tax counsel to Nevada Power Company ("Nevada
Power") and NVP Capital I (the "Series A Issuer"), in connection with the
preparation and filing with the Securities and Exchange Commission (the
"Commission") of a Registration Statement on Form S-3 (the "Registration
Statement"), under the Securities Act of 1933, as amended (the "Securities
Act"), relating to the proposed issuance of ____________ of ___% Cumulative
Quarterly Income Preferred Securities, Series A (the "Series A QUIPS"), the
proceeds of which will be used by the Series A Issuer to purchase from Nevada
Power the ___% Junior Subordinated Deferrable Interest Debentures, Series A
(the "Series A QUIDS"). The Series A QUIPS are fully, irrevocably, and
unconditionally guaranteed by Nevada Power pursuant to the Guarantee
Agreement between Nevada Power, as Guarantor, and IBJ Schroeder Bank & Trust
Company, as Guarantee Trustee (the "Guarantee Agreement"). Capitalized terms
not otherwise defined herein shall have the same meanings as they have in
documents listed in the paragraph below (the "Transaction Documents").
In delivering this opinion, we have reviewed the Registration Statement
and have reviewed and relied upon: (i) the form of the Amended and Restated
Trust Agreement among Nevada Power and the several trustees named therein,
(ii) the form of the Junior Subordinated Indenture between Nevada Power and
IBJ Schroeder Bank & Trust Company, as Trustee, (iii) the form of the
Guarantee Agreement, (iv) the form the
<PAGE>
Nevada Power Company
NVP Capital I
February __, 1997
Page 2
Series A QUIPS, and (v) the form of the Series A QUIDS, each as filed as
exhibits to the Registration Statement. In addition, we have examined such
other documents, statutes and authorities, and have made such other and
further investigations, as we have deemed relevant and necessary as a basis
for the opinion hereinafter set forth.
Based on the foregoing, we hereby confirm that the statements set forth
in the Registration Statement under the caption "Certain Federal Income Tax
Consequences", insofar as they purport to constitute a summary of matters of
United States federal income tax law and regulations or legal conclusions
with respect thereto, constitute an accurate summary of the United States
federal income tax matters described therein.
We express no opinion with respect to the transactions referred to
herein and in the Registration Statement other than as expressly set forth
herein. Our opinions are not binding on the IRS and the IRS could disagree
with the opinions expressed herein. Although we believe that the opinions we
express herein would be sustained if challenged, there can be no assurance
that this will be the case.
Our opinions are based upon the Code, the Treasury regulations
promulgated thereunder and other relevant authorities and law, all as in
effect on the date hereof. Consequently, future changes in the law may cause
the tax treatment of the transactions referred to herein to be materially
different from that described above.
We do not express any opinion herein concerning any law other than the
federal income tax law of the United States.
This opinion letter is being delivered to each of the addressees solely
for its benefit and none of the addressees may use, circulate, quote or
otherwise refer to this opinion letter, or the opinions expressed herein, for
any purpose without our express written consent. We hereby consent to the
filing of this letter as an exhibit to the Registration Statement and to the
use of our name in the sections entitled "Certain Federal Income Tax
Consequences" and "Legal Opinions" contained in the Registration Statement.
Very truly yours,
<PAGE>
EXHIBIT 12.01
NEVADA POWER COMPANY
Computation of Ratios of Earnings to Fixed Charges
(In Thousands)
<TABLE>
September 30, December 31,
---------------------- ---------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
------- ------- ---------------------------------------------------
<C> <S> <S>
EARNINGS:
Net Income 88,083 74,536 76,971 81,870 73,548 56,780 35,176
Taxes on Income 43,744 41,333 37,790 44,716 39,665 29,223 14,993
------- ------- ---------------------------------------------------
Net Income Before Income Taxes 131,827 115,869 114,761 126,586 113,213 86,003 50,169
Fixed Charges 65,385 60,469 62,273 60,042 59,437 60,762 56,395
------- ------- ---------------------------------------------------
Total 197,212 176,338 177,034 186,628 172,650 146,765 106,564
======= ======= ===================================================
FIXED CHARGES
Interest Charges 64,362 59,477 61,466 58,839 58,699 59,801 55,550
One-third Annual Rentals 1,023 992 807 1,203 738 961 845
------- ------- ---------------------------------------------------
Total 65,385 60,469 62,273 60,042 59,437 60,762 56,395
======= ======= ===================================================
12 MONTHS RATIO OF EARNINGS TO FIXED CHARGES 3.02 2.92 2.84 3.11 2.90 2.42 1.89
</TABLE>
