<PAGE>
__________________________________________________________________________
__________________________________________________________________________
FORM 8-K
CURRENT REPORT
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): December 5, 1996
Commission Registrant; State of Incorporation; IRS Employer
File Number Address; and Telephone Number Identification No
1-9513 CMS ENERGY CORPORATION 38-2726431
(A Michigan Corporation)
Fairlane Plaza South, Suite 1100
330 Town Center Drive
Dearborn, Michigan 48126
(313) 436-9261
__________________________________________________________________________
__________________________________________________________________________
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ITEM 5. Other Events
On December 5, 1996, CMS Energy filed a shelf registration statement on
Form S-3 (File No. 333-17289) covering the issuance of up to $500 million
of senior and subordinated debt securities. Pursuant to such filing, CMS
Energy is required to file a form of underwriting agreement with respect
to any offered securities. In addition, in connection with an offering
under such shelf registration statement, CMS Energy desires to file a form
of the supplemental indenture for the senior debt securities being
offered. Copies of such documents are included as Exhibits to this
Current Report on Form 8-K and are incorporated herein by reference.
On March 17, 1997, CMS Energy entered into a Third Supplemental Indenture
between CMS Energy and The Chase Manhattan Bank, as Trustee, pursuant to
which CMS Energy may issue and sell, from time to time, up to $150 million
aggregate principal amount of General Term Notes(R), Series C. A copy of
the Third Supplemental Indenture is included as an Exhibit to this Current
Report on Form 8-K and are incorporated herein by reference.
ITEM 7. Financial Statement and Exhibits
(1) Form of Underwriting Agreement
(4)(a) Form of Third Supplemental Indenture between CMS Energy and
NBD Bank, as Trustee, under an Indenture dated as of
October 1, 1992
(4)(a)(iv) Third Supplemental Indenture dated as of March 17, 1997
between CMS Energy and The Chase Manhattan Bank, as
Trustee, under an Indenture dated January 15, 1994
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CMS ENERGY CORPORATION
Dated: May 1, 1997 By: /s/ Alan M. Wright
_______________________
Alan M. Wright
Senior Vice President,
Chief Financial Officer
and Treasurer
<PAGE>
EXHIBIT (1)
CMS ENERGY CORPORATION
__% Senior Notes Due 2002
Underwriting Agreement
May __, 1997
To the Representatives named
in Schedule I hereto of the
Underwriters named in
Schedule II hereto
Dear Sirs:
CMS Energy Corporation, a Michigan corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to issue and
sell to the several Underwriters (as defined in Section 14 hereof) its
Senior Unsecured Notes, to be in the aggregate principal amount, to mature
in the year and to have the interest rate specified in Schedule III hereto
(the "Securities"), and hereby confirms its agreement with the
Underwriters as set forth herein. The Securities shall be issued pursuant
to the Indenture dated as of September 15, 1992, between the Company and
NBD Bank, as Trustee (the "Trustee"), as amended and supplemented and to
be supplemented by various supplemental indentures, including the Third
Supplemental Indenture dated as of May __, 1997, relating to the
Securities (such Indenture as so amended and supplemented and to be
supplemented, the "Indenture"). The Underwriters have designated the
Representatives to execute this Agreement on their behalf and to act for
them in the manner provided in this Agreement.
The Company has prepared and filed with the Securities and
Exchange Commission (the "Commission"), in accordance with the provisions
of the Securities Act of 1933, as amended (the "Act"), a registration
statement on Form S-3 (Registration No. 333-17289) including a prospectus
relating to the Securities and such registration statement has become
effective under the Act. The registration statement, at the time such
registration statement became effective and as it may have been thereafter
amended to the date of this Agreement (including the documents then
incorporated by reference therein) is hereinafter referred to as the
"Registration Statement." The prospectus forming a part of the
Registration Statement at the time the Registration Statement became
effective (including the documents then incorporated by reference therein)
is hereinafter referred to as the "Basic Prospectus," provided that in the
event that the Basic Prospectus shall have been amended, revised or
supplemented prior to the date of this Agreement, or if the Company shall
have supplemented the Basic Prospectus by filing any documents pursuant to
Section 13 or 14 or 15 of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), after the time the Registration Statement became
effective and prior to the date of this Agreement, which documents are
deemed to be incorporated in the Basic Prospectus, the term "Basic
Prospectus" shall also mean such prospectus as so amended, revised or
supplemented. The Basic Prospectus, as it shall be revised or
supplemented to reflect the final terms of the offering and sale of the
Securities by a prospectus supplement relating to the Securities, and in
the form to be filed with, or transmitted for filing to, the Commission
pursuant to Rule 424 under the Act, is hereinafter referred to as the
"Prospectus." Any reference herein to the terms "amend," "amendment" or
"supplement" with respect to the Registration Statement or the Prospectus
shall be deemed to include only amendments or supplements to the
Registration Statement or Prospectus, as the case may be, and documents
incorporated by reference therein after the date of this Agreement and
prior to the termination of the offering of the Securities by the
Underwriters.
1. Purchase and Sale: Upon the basis of the representations and
warranties and on the terms and subject to the conditions herein set
forth, the Company agrees to sell to the respective Underwriters,
severally and not jointly, and the respective Underwriters, severally and
not jointly, agree to purchase from the Company, at the purchase price
specified in Schedule III hereto, the respective principal amounts of
Securities set opposite their names in Schedule II hereto.
The Company is advised by the Representatives that the
Underwriters propose to make a public offering of their respective
portions of the Securities as soon as practicable, in their judgment,
after this Agreement has become effective. The Company is further advised
by the Representatives that the Securities are to be offered to the public
initially at ___% of the principal amount of the Securities and to certain
dealers selected by you at a price that represents a concession not in
excess of __% of the principal amount of the Securities, and that any
Underwriter may allow, and such dealers may reallow, a concession not in
excess of __% of the principal amount of the Securities to certain other
dealers.
The Company hereby agrees that, without the prior written consent
of ____________________, the Company will not offer, sell, contract to
sell or otherwise issue debt securities substantially similar to the
Securities for a period from the date of the execution of this Agreement
to the day of the Time of Purchase (as hereinafter defined).
2. Payment and Delivery: Payment for the Securities shall be
made to the Company or its order in Federal or other immediately available
funds in New York City (or such other place or places of payment as shall
be agreed upon by the Company and the Representatives in writing), upon
the delivery of the Securities at the offices of Reid & Priest LLP, 40
West 57th Street, New York, New York 10019 (or such other place or places
of delivery as shall be agreed upon by the Company and the
Representatives) to the Representatives for the respective accounts of the
Underwriters against receipt therefor signed by the Representatives on
behalf of themselves and as agent for the other Underwriters. Such
payment and delivery shall be made at 10:00 A.M., New York time on May __,
1997 (or on such later business day as shall be agreed upon by the Company
and the Representatives in writing), unless postponed in accordance with
the provisions of Section 10 hereof. The day and time at which payment
and delivery for the Securities are to be made is herein called the "Time
of Purchase."
Delivery of the Securities shall be made in definitive, fully
registered form in authorized denominations registered in such names as
the Representatives may request in writing to the Company not later than
two full business days prior to the Time of Purchase, or if no such
request is received, in the names of the respective Underwriters for the
respective principal amounts of Securities set forth opposite the name of
each Underwriter in Schedule II, in denominations selected by the Company.
The Company agrees to make the Securities available for inspection
by the Underwriters at the offices of _________________________________ at
least 24 hours prior to the Time of Purchase, in definitive, fully
registered form, and as requested pursuant to the preceding paragraph.
3. Conditions of Underwriters' Obligations: The several
obligations of the Underwriters hereunder are subject to the accuracy of
the warranties and representations on the part of the Company and to the
following other conditions:
(a) That all legal proceedings to be taken in connection
with the issue and sale of the Securities shall be reasonably
satisfactory in form and substance to Reid & Priest LLP, of New
York, New York, counsel to the Underwriters.
(b) That, at the Time of Purchase, the Representatives
shall be furnished with the following opinions, dated the day of
the Time of Purchase:
(1) Opinion of Michael D. VanHemert, Esq.,
counsel to the Company, substantially to the effect set
forth in Exhibit A to this Agreement; and
(2) Opinion of Reid & Priest LLP, of New York,
New York, counsel to the Underwriters, substantially to
the effect set forth in Exhibit B to this Agreement.
(c) That on the date of the Time of Purchase the
Representatives shall have received a letter from Arthur
Andersen LLP in form and substance satisfactory to the
Representatives, dated as of such date, (i) confirming that they
are independent public accountants within the meaning of the Act
and the applicable published rules and regulations of the
Commission thereunder, (ii) stating that in their opinion the
financial statements examined by them and included or incorporated
by reference in the Registration Statement complied as to form in
all material respects with the applicable accounting requirements
of the Commission, including applicable published rules and
regulations of the Commission, and (iii) covering, as of a date
not more than five business days prior to the date of such letter,
such other matters as the Representatives reasonably request.
(d) That, between the date of the execution of this
Agreement and the Time of Purchase, no material and adverse change
shall have occurred in the business, properties or financial
condition of the Company and its subsidiaries (as defined in Rule
405 under the Act, and hereafter called the "Subsidiaries"), taken
as a whole, which, in the judgment of the Representatives, after
reasonable inquiries on the part of the Representatives, impairs
the marketability of the Securities (other than changes referred
to in or contemplated by the Registration Statement or
Prospectus).
(e) That, prior to the Time of Purchase, no stop order
suspending the effectiveness of the Registration Statement shall
have been issued under the Act by the Commission or proceedings
therefor initiated or threatened.
(f) That, at the Time of Purchase, the Company shall have
delivered to the Representatives a certificate of an executive
officer of the Company to the effect that, to the best of his
knowledge, information and belief there shall have been no
material adverse change in the business, properties or financial
condition of the Company and its Subsidiaries, taken as a whole,
from that set forth in the Registration Statement or Prospectus
(other than changes referred to in or contemplated by the
Registration Statement or Prospectus).
(g) That the Company shall have performed such of its
obligations under this Agreement as are to be performed at or
before the Time of Purchase by the terms hereof.
(h) That any additional documents or agreements
reasonably requested by the Representatives or their counsel to
permit the Underwriters to perform their obligations or permit
their counsel to deliver opinions hereunder shall have been
provided to them.
(i) That between the date of the execution of this
Agreement and the day of the Time of Purchase there has been no
downgrading of the investment ratings of any of the Company's
securities or of Consumers Energy Company's first mortgage bonds
by Standard & Poor's Corporation, Moody's Investors Service, Inc.
or Duff & Phelps Credit Rating Co., and neither the Company nor
Consumers Energy Company shall have been placed on "credit watch"
or "credit review" with negative implications by any of such
statistical rating organizations if any of such occurrences shall,
in the reasonable judgment of the Representatives, after
reasonable inquiries on the part of the Representatives, impair
the marketability of the Securities.
(j) That any filing of the Prospectus and any supplements
thereto required pursuant to Rule 424 under the Act have been made
in compliance with Rule 424 in the time periods provided by
Rule 424.
4. Conditions of the Company's Obligations: The obligations of
the Company hereunder are subject to the satisfaction of the condition set
forth in Section 3(e).
5. Certain Covenants of the Company: In further consideration of
the agreements of the Underwriters herein contained, the Company covenants
as follows:
(a) To use its best efforts to cause any post-effective
amendments to the Registration Statement to become effective as
promptly as possible. During the time when a Prospectus is
required to be delivered under the Act, the Company will comply so
far as it is able with all requirements imposed upon it by the Act
and the rules and regulations of the Commission to the extent
necessary to permit the continuance of sales of or dealings in the
Securities in accordance with the provisions hereof and of the
Prospectus.
(b) To deliver to each of the Representatives a conformed
copy of the Registration Statement and any amendments thereto
(including all exhibits thereto) and full and complete sets of all
comments of the Commission or its staff and all responses thereto
with respect to the Registration Statement and any amendments
thereto, and to furnish to the Representatives, for each of the
Underwriters, conformed copies of the Registration Statement and
any amendments thereto, without exhibits.
(c) As soon as the Company is advised thereof, the
Company will advise the Representatives and confirm the advice in
writing of: (i) the effectiveness of any amendment to the
Registration Statement, (ii) any request made by the Commission
for amendments to the Registration Statement or Prospectus or for
additional information with respect thereto, (iii) the suspension
of qualification of the Securities for sale under Blue Sky or
state securities laws, and (iv) the entry of a stop order
suspending the effectiveness of the Registration Statement or of
the initiation or threat or any proceedings for that purpose and,
if such a stop order should be entered by the Commission, to make
every reasonable effort to obtain the lifting or removal thereof.
(d) To deliver to the Underwriters, without charge, as
soon as practicable, and from time to time during such period of
time (not exceeding nine months) after the date of the Prospectus
as they are required by law to deliver a prospectus, as many
copies of the Prospectus (as supplemented or amended if the
Company shall have made any supplements or amendments thereto) as
the Representatives may reasonably request; and in case any
Underwriter is required to deliver a prospectus after the
expiration of nine months after the date of the Prospectus, to
furnish to the Representatives, upon request, at the expense of
such Underwriter, a reasonable quantity of a supplemental
prospectus or of supplements to the Prospectus complying with
Section 10(a)(3) of the Act.
(e) For such period of time (not exceeding nine months)
after the date of the Prospectus as the Underwriters are required
by law to deliver a prospectus in respect of the Securities, if
any event shall have occurred as a result of which it is necessary
to amend or supplement the Prospectus in order to make the
statements therein, in light of the circumstances when the
Prospectus is delivered to a purchaser, not misleading, or if it
becomes necessary to amend or supplement the Prospectus to comply
with law, to forthwith prepare and file with the Commission an
appropriate amendment or supplement to the Prospectus and deliver
to the Underwriters, without charge, such number of copies thereof
as may be reasonably requested.
(f) To make generally available to the Company's security
holders, as soon as practicable, an "earning statement" (which
need not be audited by independent public accountants) covering a
twelve-month period commencing after the effective date of the
Registration Statement and ending not later than 15 months
thereafter, which shall comply in all material respects with and
satisfy the provisions of Section 11(a) of the Act and Rule 158
under the Act.
(g) To use its best efforts to qualify the Securities for
offer and sale under the securities or Blue Sky laws of such
jurisdictions as the Representatives may designate and to pay (or
cause to be paid), or reimburse (or cause to be reimbursed) the
Underwriters and their counsel for, reasonable filing fees and
expenses in connection therewith (including the reasonable fees
and disbursements of counsel to the Underwriters and filing fees
and expenses paid and incurred prior to the date hereof),
provided, however, that the Company shall not be required to
qualify to do business as a foreign corporation or as a securities
dealer or to file a general consent to service of process or to
file annual reports or to comply with any other requirements
deemed by the Company to be unduly burdensome.
(h) To pay all expenses, fees and taxes (other than
transfer taxes on sales by the respective Underwriters) in
connection with the issuance and delivery of the Securities,
except that the Company shall be required to pay the fees and
disbursements (other than disbursements referred to in
paragraph (g) of this Section 5) of Reid & Priest LLP, of New
York, New York, counsel to the Underwriters, only in the events
provided in paragraph (i) of this Section 5, the Underwriters
hereby agreeing to pay such fees and disbursements in any other
event, and that except as provided in Section (i), the Company
shall not be responsible for any out-of-pocket expenses of the
Underwriters in connection with their services hereunder.
(i) If the Underwriters shall not take up and pay for the
Securities due to the failure of the Company to comply with any of
the conditions specified in Section 3 hereof, or, if this
Agreement shall be terminated in accordance with the provisions of
Section 11 hereof prior to the Time of Purchase, to pay the
reasonable fees and disbursements of Reid & Priest LLP, counsel to
the Underwriters, and, if the Underwriters shall not take up and
pay for the Securities due to the failure of the Company to comply
with any of the conditions specified in Section 3 hereof, to
reimburse the Underwriters for their reasonable out-of-pocket
expenses, in an aggregate amount not exceeding a total of $3,000,
incurred in connection with the financing contemplated by this
Agreement.
(j) Prior to the termination of the offering of the
Securities, to not file any amendment to the Registration
Statement or supplement to the Prospectus (including the Basic
Prospectus) unless the Company has furnished the Representatives
and counsel to the Underwriters with a copy for their review and
comment a reasonable time prior to filing and has reasonably
considered any comments of the Representatives, or any such
amendment or supplement to which such counsel shall reasonably
object on legal grounds in writing, after consultation with the
Representatives.
(k) To furnish the Representatives with copies of all
documents required to be filed with the Commission pursuant to
Section 13, 14 or 15(d) of the Exchange Act subsequent to the time
the Registration Statement becomes effective and prior to the
termination of the offering of the Securities.
(l) So long as may be required by law for the
distribution of the Securities by the Underwriters or by any
dealers that participate in the distribution thereof, the Company
will comply with all requirements under the Exchange Act relating
to the timely filing with the Commission of its reports pursuant
to Section 13 of the Exchange Act and of its proxy statements
pursuant to Section 14 of the Exchange Act.
6. Representations and Warranties of the Company: The Company
represents and warrants to, and agrees with, each of the Underwriters
that:
(a) The Registration Statement has become effective under
the Act; a true and correct copy of the Registration Statement in
the form in which it became effective has been delivered to each
of the Representatives and to the Representatives for each of the
Underwriters (except that copies delivered for the Underwriters
excluded exhibits to such Registration Statement); any filing of
the Prospectus and any supplements thereto required pursuant to
Rule 424(b) has been or will be made in the manner required by
Rule 424(b) and within the time period required by Section 3(j)
hereof; no stop order suspending the effectiveness of the
Registration Statement is in effect, and no proceedings for such
purposes are pending before or, to the knowledge of the Company,
threatened by the Commission. On the effective date of the
Registration Statement, the Registration Statement and the Basic
Prospectus complied, or were deemed to have complied, and on its
respective issue date, each preliminary prospectus filed pursuant
to Rule 424(b) complied, and the Basic Prospectus complied, and on
its issue date, the Prospectus will comply, or will be deemed to
comply, in all material respects with the applicable provisions of
the Act, the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act") and the published rules and regulations of the
Commission, none of the Registration Statement on its effective
date, the Basic Prospectus on its issue date, or any other
preliminary prospectus, on its issue date, contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, and the Prospectus, as of its issue date
and, as amended or supplemented, if applicable, as of the Time of
Purchase, 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, except that the Company makes no warranty or
representation to any Underwriter with respect to any statements
or omissions made therein in reliance upon and in conformity with
information furnished in writing to the Company by, or through the
Representatives on behalf of, any Underwriter expressly for use
therein, or to any statements in or omissions from that part of
the Registration Statement that shall constitute the Statement of
Eligibility and Qualification under the Trust Indenture Act of the
Trustee under the Indenture.
(b) The documents incorporated by reference in the
Registration Statement, any preliminary prospectus, the Basic
Prospectus and the Prospectus, when they were filed (or, if an
amendment with respect to any such document was filed, when such
amendment was filed) with the Commission, conformed in all
material respects to the requirements of the Exchange Act and the
rules and regulations of the Commission promulgated thereunder,
and any further documents so filed and incorporated by reference
will, when they are filed with the Commission, conform in all
material respects to the requirements of the Exchange Act and the
rules and regulations of the Commission promulgated thereunder;
none of such documents, when it was filed (or, if an amendment
with respect to any such document was filed, when such amendment
was filed), contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; and no
such further document, when it is filed, will contain an untrue
statement of a material fact or will omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they are made,
not misleading.
(c) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the
State of Michigan and has all requisite authority to own or lease
its properties and conduct its business as described in the
Prospectus and to consummate the transactions contemplated hereby,
and is duly qualified to transact business and is in good standing
in each jurisdiction in which the conduct of its business as
described in the Prospectus or its ownership or leasing of
property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not
have a material adverse effect on the Company and its Subsidiaries
taken as a whole. Each significant subsidiary (as defined in
Rule 405 under the Act, and hereinafter called a "Significant
Subsidiary") of the Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has all requisite authority to
own or lease its properties and conduct its business as described
in the Prospectus and is duly qualified to transact business and
is in good standing in each jurisdiction in which the conduct of
its business as described in the Prospectus or its ownership or
leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing
would not have a material adverse effect on the Company and its
Subsidiaries, taken as a whole.
(d) The Securities are in the form contemplated by
the Indenture and have been duly authorized by the Company. At
the Time of Purchase, the Securities will have been duly executed
and delivered by the Company and, when authenticated by the
Trustee in the manner provided for in the Indenture and delivered
against payment therefor as provided in this Agreement, will
constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms,
except to the extent that enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors' rights generally or by general
principles of equity (regardless of whether enforcement is
considered in a proceeding at law or in equity). The Securities
conform in all material respects to the descriptions thereof in
the Prospectus.
(e) The Indenture has been duly authorized by the
Company. At the Time of Purchase, the Indenture will have been
duly executed and delivered by the Company and will constitute a
valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms, except to the extent
that enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting
creditors' rights generally or by general principles of equity
(regardless of whether enforcement is considered in a proceeding
at law or in equity); the Indenture conforms in all material
respects to the description thereof in the Prospectus; and the
Indenture has been duly qualified under the Trust Indenture Act.
(f) Except for the outstanding shares of preferred
stock of Consumers Energy Company and the 8.36% Trust Originated
Preferred Securities of Consumers Power Company Financing I, all
of the outstanding capital stock of each of Consumers Energy
Company and CMS Enterprises Company is owned directly or
indirectly by the Company, free and clear of any security
interest, claim, lien, or other encumbrance or preemptive rights,
and (ii) there are no outstanding rights (including, without
limitation, preemptive rights), warrants or options to acquire, or
instruments convertible into or exchangeable for, any shares of
capital stock or other equity interest in any of Consumers Energy
Company and CMS Enterprises Company or any contract, commitment,
agreement, understanding or arrangement of any kind relating to
the issuance of any such capital stock, any such convertible or
exchangeable securities or any such rights, warrants or options.
(g) Each of the Company and its Significant
Subsidiaries has all necessary consents, authorizations,
approvals, orders, certificates and permits of and from, and has
made all declarations and filings with, all federal, state, local
and other governmental authorities, all self-regulatory
organizations and all courts and other tribunals, to own, lease,
license and use its properties and assets and to conduct its
business in the manner described in the Prospectus, except to the
extent that the failure to obtain or file would not have a
material adverse effect on the Company and its Subsidiaries, taken
as a whole.
(h) No order, license, consent, authorization or
approval of, or exemption by, or the giving of notice to, or the
registration with any federal, state, municipal or other
governmental department, commission, board, bureau, agency or
instrumentality, and no filing, recording, publication or
registration in any public office or any other place, was or is
now required to be obtained by the Company to authorize its
execution or delivery of, or the performance of its obligations
under, this Agreement or the Securities, except such as have been
obtained or may be required under state securities or Blue Sky
laws or as referred to in the Basic Prospectus. Each of the
Company and its Significant Subsidiaries has all necessary
consents, authorizations, approvals, orders, certificates and
permits of and from, and has made all declarations and filings
with, all federal, state, local and other governmental
authorities, all self-regulatory organizations and all courts and
other tribunals, to own, lease, license and use its properties and
assets and to conduct its business in the manner described in the
Basic Prospectus, except to the extent that the failure to obtain
or file would not have a material adverse effect on the Company
and its Subsidiaries, taken as a whole.
(i) None of the issuance and sale of the Securities,
or the execution or delivery by the Company of, or the performance
by the Company of its obligations under, this Agreement did or
will conflict with, result in a breach of any of the terms or
provisions of, or constitute a default or require the consent of
any party under the Company's Articles of Incorporation or
by-laws, any material agreement or instrument to which it is a
party, any existing applicable law, rule or regulation or any
judgment, order or decree of any government, governmental
instrumentality or court, domestic or foreign, having jurisdiction
over the Company or any of its properties or assets, or did or
will result in the creation or imposition of any lien on the
Company's properties or assets.
(j) Except as disclosed in the Basic Prospectus,
there is no action, suit, proceeding, inquiry or investigation (at
law or in equity or otherwise) pending or, to the knowledge of the
Company, threatened against the Company or any Subsidiary by any
governmental authority that (i) questions the validity,
enforceability or performance of this Agreement or the Securities
or (ii) if determined adversely, is likely to have a material
adverse effect on the business or financial condition of the
Company and the Subsidiaries, taken as a whole, or materially
adversely affect the ability of the Company to perform its
obligations hereunder or the consummation of the transactions
contemplated by this Agreement.
(k) There has not been any material and adverse
change in the business, properties or financial condition of the
Company and its Subsidiaries, taken as a whole, from that set
forth in the Registration Statement (other than changes referred
to in or contemplated by the Registration Statement or the Basic
Prospectus).
(l) Except as set forth in the Basic Prospectus, no
event or condition exists that constitutes, or with the giving of
notice or lapse of time or both would constitute, a default or any
breach or failure to perform by the Company or any of its
Significant Subsidiaries in any material respect under any
indenture, mortgage, loan agreement, lease or other material
agreement or instrument to which the Company or any of its
Significant Subsidiaries is a party or by which it or any of its
Significant Subsidiaries, or any of their respective properties,
may be bound.
7. Representation and Warranties of Underwriters: Each
Underwriter warrants and represents that the information, if any,
furnished in writing to the Company through the Representatives expressly
for use in the Registration Statement and Prospectus is correct in all
material respects as to such Underwriter. Each Underwriter, in addition
to other information furnished to the Company for use in the Registration
Statement and Prospectus, herewith furnishes to the Company for use in the
Registration Statement and Prospectus, the information stated herein with
regard to the public offering, if any, by such Underwriter and represents
and warrants that such information is correct in all material respects as
to such Underwriter.
8. Indemnification:
(a) The Company agrees, to the extent permitted by
law, to indemnify and hold harmless each of the Underwriters and
each person, if any, who controls any such Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange
Act, against any and all losses, claims, damages or liabilities,
joint or several, to which they or any of them may become subject
under the Act or otherwise, and to reimburse the Underwriters and
such controlling person or persons, if any, for any legal or other
expenses incurred by them in connection with defending any action,
suit or proceeding (including governmental investigations) as
provided in Section 8(c) hereof, insofar as such losses, claims,
damages, liabilities or actions, suits or proceedings (including
governmental investigations) arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, any preliminary
prospectus as of its issue date (if used prior to the date of the
Basic Prospectus), the Basic Prospectus (if used prior to the date
of the Prospectus), the Prospectus, or, if the Prospectus shall be
amended or supplemented, in the Prospectus as so amended or
supplemented (if such Prospectus or such Prospectus as amended or
supplemented is used after the period of time referred to in
Section 5(e) hereof, it shall contain or be used with such
amendments or supplements as the Company deems necessary to comply
with Section 10(a) of the Act), or arise out of or are based upon
any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any
such untrue statement or alleged untrue statement or omission or
alleged omission which was made in such preliminary prospectus,
Basic Prospectus, Registration Statement or Prospectus, or in the
Prospectus as so amended or supplemented, in reliance upon and in
conformity with information furnished in writing to the Company
by, or through the Representatives on behalf of, any Underwriter
expressly for use therein or with any statements in or omissions
from that part of the Registration Statement that shall constitute
the Statement of Eligibility and Qualification under the Trust
Indenture Act of the Trustee under the Indenture, and except that
this indemnity shall not inure to the benefit of any Underwriter
(or any person controlling such Underwriter) on account of any
losses, claims, damages, liabilities or actions, suits or
proceedings arising from the sale of the Securities to any person
if a copy of the Prospectus, as the same may then be supplemented
or amended (excluding, however, any document then incorporated or
deemed incorporated therein by reference), was not sent or given
by or on behalf of such Underwriter to such person (i) with or
prior to the written confirmation of sale involved or (ii) as soon
as available after such written confirmation, relating to an event
occurring prior to the payment for and delivery to such person of
the Securities involved in such sale, and the omission or alleged
omission or untrue statement or alleged untrue statement was
corrected in the Prospectus as supplemented or amended at such
time.
The Company's indemnity agreement contained in this
Section 8(a), and the covenants, representations and warranties of
the Company contained in this Agreement, shall remain in full
force and effect regardless of any investigation made by or on
behalf of any person, and shall survive the delivery of and
payment for the Securities hereunder, and the indemnity agreement
contained in this Section 8 shall survive any termination of this
Agreement. The liabilities of the Company in this Section 8(a)
are in addition to any other liabilities of the Company under this
Agreement or otherwise.
(b) Each Underwriter agrees, severally and not
jointly, to the extent permitted by law, to indemnify, hold
harmless and reimburse the Company, its directors and such of its
officers as shall have signed the Registration Statement, each
other Underwriter and each person, if any, who controls the
Company or any such other Underwriter within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, to the
same extent and upon the same terms as the indemnity agreement of
the Company set forth in Section 8(a) hereof, but only with
respect to alleged untrue statements or omissions made in the
Registration Statement, the Basic Prospectus or in the Prospectus,
as amended or supplemented, (if applicable) in reliance upon and
in conformity with information furnished in writing to the Company
by such Underwriter expressly for use therein.
The indemnity agreement on the part of each Underwriter
contained in this Section 8(b) and the representations and
warranties of such Underwriter contained in this Agreement shall
remain in full force and effect regardless of any investigation
made by or on behalf of the Company or any other person, and shall
survive the delivery of and payment for the Securities hereunder,
and the indemnity agreement contained in this Section 8(b) shall
survive any termination of this Agreement. The liabilities of
each Underwriter in Section 8(b) are in addition to any other
liabilities of such Underwriter under this Agreement or otherwise.
(b) If a claim is made or an action, suit or
proceeding (including governmental investigations) is commenced or
threatened against any person as to which indemnity may be sought
under Section 8(a) or 8(b), such person (the "Indemnified Person")
shall notify the person against whom such indemnity may be sought
(the "Indemnifying Person") promptly after any assertion of such
claim threatening to institute an action, suit or proceeding or if
such an action, suit or proceeding is commenced against such
Indemnified Person, promptly after such Indemnified Person shall
have been served with a summons or other first legal process,
giving information as to the nature and basis of the claim.
Failure to so notify the Indemnifying Person shall not, however,
relieve the Indemnifying Person from any liability which it may
have on account of the indemnity under Section 8(a) or 8(b) if the
Indemnifying Person has not been prejudiced in any material
respect by such failure. Subject to the immediately succeeding
sentence, the Indemnifying Person shall assume the defense of any
such litigation or proceeding, including the employment of counsel
and the payment of all expenses, with such counsel being
designated, subject to the immediately succeeding sentence, in
writing by the Representatives in the case of parties indemnified
pursuant to Section 8(b) and by the Company in the case of parties
indemnified pursuant to Section 8(a). Any Indemnified Person
shall have the right to participate in such litigation or
proceeding and to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such
Indemnified Person unless (i) the Indemnifying Person and the
Indemnified Person shall have mutually agreed to the retention of
such counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include (x) the Indemnifying
Person and (y) the Indemnified Person and, in the written opinion
of counsel to such Indemnified Person, representation of both
parties by the same counsel would be inappropriate due to actual
or likely conflicts of interest between them, in either of which
cases the reasonable fees and expenses of counsel (including
disbursements) for such Indemnified Person shall be reimbursed by
the Indemnifying Person to the Indemnified Person. If there is a
conflict as described in clause (ii) above, and the Indemnified
Persons have participated in the litigation or proceeding
utilizing separate counsel whose fees and expenses have been
reimbursed by the Indemnifying Person and the Indemnified Persons,
or any of them, are found to be solely liable, such Indemnified
Persons shall repay to the Indemnifying Person such fees and
expenses of such separate counsel as the Indemnifying Person shall
have reimbursed. It is understood that the Indemnifying Person
shall not, in connection with any litigation or proceeding or
related litigation or proceedings in the same jurisdiction as to
which the Indemnified Persons are entitled to such separate
representation, be liable under this Agreement for the reasonable
fees and out-of-pocket expenses of more than one separate firm
(together with not more than one appropriate local counsel) for
all such Indemnified Persons. Subject to the next paragraph, all
such fees and expenses shall be reimbursed by payment to the
Indemnified Persons of such reasonable fees and expenses of
counsel promptly after payment thereof by the Indemnified Persons.
In furtherance of the requirement above that fees and
expenses of any separate counsel for the Indemnified Persons shall
be reasonable, the Representatives and the Company agree that the
Indemnifying Person's obligations to pay such fees and expenses
shall be conditioned upon the following:
(1) in case separate counsel is proposed to be
retained by the Indemnified Persons pursuant to clause
(ii) of the preceding paragraph, the Indemnified Persons
shall in good faith fully consult with the Indemnifying
Person in advance as to the selection of such counsel;
(2) reimbursable fees and expenses of such
separate counsel shall be detailed and supported in a
manner reasonably acceptable to the Indemnifying Person
(but nothing herein shall be deemed to require the
furnishing to the Indemnifying Person of any information,
including without limitation, computer print-outs of
lawyers' daily time entries, to the extent that, in the
judgment of such counsel, furnishing such information
might reasonably be expected to result in a waiver of any
attorney-client privilege); and
(3) the Company and the Representatives shall
cooperate in monitoring and controlling the fees and
expenses of separate counsel for Indemnified Persons for
which the Indemnifying Person is liable hereunder, and the
Indemnified Person shall use every reasonable effort to
cause such separate counsel to minimize the duplication of
activities as between themselves and counsel to the
Indemnifying Person.
The Indemnifying Person shall not be liable for any
settlement of any litigation or proceeding effected without the
written consent of the Indemnifying Person, but if settled with
such consent or if there be a final judgment for the plaintiff,
the Indemnifying Person agrees, subject to the provisions of this
Section 8, to indemnify the Indemnified Person from and against
any loss, damage, liability or expenses by reason of such
settlement or judgment. The Indemnifying Person shall not,
without the prior written consent of the Indemnified Persons,
effect any settlement of any pending or threatened litigation,
proceeding or claim in respect of which indemnity has been
properly sought by the Indemnified Persons hereunder, unless such
settlement includes an unconditional release by the claimant of
all Indemnified Persons from all liability with respect to claims
which are the subject matter of such litigation, proceeding or
claim.
9. Contribution: If the indemnification provided for in
Section 8 above is unavailable to or insufficient to hold harmless an
Indemnified Person under such Section in respect of any losses, claims,
damages or liabilities (or actions, suits or proceedings (including
governmental investigations) in respect thereof) referred to therein, then
each Indemnifying Person under Section 8 shall contribute to the amount
paid or payable by such Indemnified Person 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 Indemnifying Person on the one hand and the Indemnified Person on the
other from the offering of the Securities. If, however, the allocation
provided by the immediately preceding sentence is not permitted by
applicable law, then each Indemnifying Person shall contribute to such
amount paid or payable by such Indemnified Person in such proportion as is
appropriate to reflect not only such relative benefits but also the
relative fault of each Indemnifying Person, if any, on the one hand and
the Indemnified Person on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities
(or actions, suits or proceedings (including governmental investigations)
in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one
hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company and the total underwriting discounts and
commission received by the Underwriters, in each case as set forth in the
table on the cover page of the Prospectus, bear to the aggregate public
offering price of the Securities. 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 Company on the one
hand or the Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this
Section 9 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 Section 9. The amount paid or payable by an
Indemnified Person as a result of the losses, claims, damages or
liabilities (or actions, suits or proceedings (including governmental
proceedings) in respect thereof) referred to above in this Section 9 shall
be deemed to include any legal or other expenses reasonably incurred by
such Indemnified Person in connection with investigating or defending any
such action, suits or proceedings (including governmental proceedings) or
claim, provided that the provisions of Section 8 have been complied with
(in all material respects) in respect of any separate counsel for such
Indemnified Person. Notwithstanding the provisions of this Section 9, no
Underwriter shall be required to contribute any amount greater than the
excess of (i) the total price at which the Securities underwritten by it
and distributed to the public were offered to the public over (ii) the
amount of any damages which such Underwriter has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this Section 9 to
contribute are several in proportion to their respective underwriting
obligations and not joint.
The agreement with respect to contribution contained in Section 9
hereof shall remain in full force and effect regardless of any
investigation made by or on behalf of the Company or any Underwriter, and
shall survive delivery of and payment for the Securities hereunder and any
termination of this Agreement.
10. Substitution of Underwriters: If any Underwriter under this
agreement shall fail or refuse (otherwise than for some reason sufficient
to justify in accordance with the terms hereof, the termination of its
obligations hereunder) to purchase the Securities which it had agreed to
purchase on the Time of Purchase, the Representatives shall immediately
notify the Company and the Representatives and the other Underwriters may,
within 36 hours of the giving of such notice, determine to purchase, or to
procure one or more other members of the National Association of
Securities Dealers, Inc. ("NASD") (or, if not members of the NASD, who are
foreign banks, dealers or institutions not registered under the Exchange
Act and who agree in making sales to comply with the NASD's Rules of Fair
Practice), satisfactory to the Company, to purchase, upon the terms herein
set forth, the principal amount of Securities which the defaulting
Underwriter had agreed to purchase. If any non-defaulting Underwriter or
Underwriters shall determine to exercise such right, the Representatives
shall give written notice to the Company of such determination within 36
hours after the Company shall have received notice of any such default,
and thereupon the Time of Purchase shall be postponed for such period, not
exceeding three business days, as the Company shall determine. If in the
event of such a default, the Representatives shall fail to give such
notice, or shall within such 36-hour period give written notice to the
Company that no other Underwriter or Underwriters, or others, will
exercise such right, then this Agreement may be terminated by the Company,
upon like notice given to the Representatives within a further period of
36 hours. If in such case the Company shall not elect to terminate this
Agreement, it shall have the right, irrespective of such default:
(a) to require such non-defaulting Underwriters to
purchase and pay for the respective principal amounts of
Securities which they had severally agreed to purchase hereunder,
as hereinabove provided, and, in addition, the principal amount of
Securities which the defaulting Underwriter shall have so failed
to purchase up to a principal amount thereof equal to one-ninth
(1/9) of the respective principal amounts of Securities which such
non-defaulting Underwriters have otherwise agreed to purchase
hereunder; and/or
(b) to procure one or more other members of the NASD
(or, if not members of the NASD, who are foreign banks, dealers or
institutions not registered under the Exchange Act and who agree
in making sales to comply with the NASD's Rules of Fair Practice),
to purchase, upon the terms herein set forth, the principal amount
of Securities which such defaulting Underwriter had agreed to
purchase, or that portion thereof which the remaining Underwriters
shall not be obligated to purchase pursuant to the foregoing
clause (a).
In the event the Company shall exercise its rights under
clause (a) and/or (b) above, the Company shall give written notice thereof
to the Representatives within such further period of 36 hours, and
thereupon the Time of Purchase shall be postponed for such period, not
exceeding five business days, as the Company shall determine. In the
event the Company shall be entitled to but shall not elect to exercise its
rights under clause (a) and/or (b), the Company shall be deemed to have
elected to terminate this Agreement.
Any action taken by the Company under this Section 10 shall not
relieve any defaulting Underwriter from liability in respect of any
default of such Underwriter under this Agreement. Termination by the
Company under this Section 10 shall be without any liability on the part
of the Company or any non-defaulting Underwriter.
In the computation of any period of 36 hours referred to in this
Section 10, there shall be excluded a period of 24 hours in respect of
each Saturday, Sunday or legal holiday which would otherwise be included
in such period of time.
11. Termination of Agreement: This Agreement may be terminated
at any time prior to the Time of Purchase by the Representatives, if,
prior to such time (i) trading generally in securities on the New York
Stock Exchange shall have been suspended by the Commission or the New York
Stock Exchange, (ii) trading of any securities of the Company shall have
been suspended on any exchange or over-the-counter market, (iii) a general
moratorium on commercial banking activities in New York shall have been
declared by federal or New York State authorities or (iv) there shall have
occurred any outbreak or material escalation of hostilities or any
material adverse disruption in financial markets or any other calamity or
crisis, the effect of which on the financial markets of the United States
is such as to impair, in the Representatives' reasonable judgment, after
having made due inquiry, the marketability of the Securities.
If the Representatives elect to terminate this Agreement, as
provided in this Section 11, the Representatives will promptly notify the
Company and each other Underwriter by telephone or telecopy, confirmed by
letter. If this Agreement shall not be carried out by any Underwriter for
any reason permitted hereunder, or if the sale of the Securities to the
Underwriters as herein contemplated shall not be carried out because the
Company is not able to comply with the terms hereof, the Company shall not
be under any obligation under this Agreement and shall not be liable to
any Underwriter or to any member of any selling group for the loss of
anticipated profits from the transactions contemplated by this Agreement
and the Underwriters shall be under no liability to the Company nor be
under any liability under this Agreement to one another.
Notwithstanding the foregoing, the provisions of Sections 5(g),
5(i), 8 and 9 shall survive any termination of this Agreement.
12. Notices: All notices hereunder shall, unless otherwise
expressly provided, be in writing and be delivered at or mailed to the
following addresses or be sent by telecopy as follows: if to the
Underwriters or the Representatives, to the Representatives at the address
or number, as appropriate, designated in Schedule I hereto, and, if to the
Company, to CMS Energy Corporation, Attention: Senior Vice President -
Finance, Fairlane Plaza South, Suite 1100, 330 Town Center Drive,
Dearborn, Michigan 48126 (Telecopy: 313-436-9548).
13. Parties in Interest: The Agreement herein set forth has been
and is made solely for the benefit of the Underwriters, the Company
(including the directors thereof and such of the officers thereof as shall
have signed the Registration Statement), and the controlling persons, if
any, referred to in Section 8 hereof, and their respective successors,
assigns, executors and administrators, and, except as expressly otherwise
provided in Section 10 hereof, no other person shall acquire or have any
right under or by virtue of this Agreement.
14. Definition of Certain Terms: The term "Underwriters," as
used herein, shall be deemed to mean the several persons, firms or
corporations, named in Schedule II hereto (including the Representatives
herein mentioned, if so named), and the term "Representatives," as used
herein, shall be deemed to mean the representative or representatives
designated by, or in the manner authorized by, the Underwriters in
Schedule I hereto. All obligations of the Underwriters hereunder are
several and not joint. If there shall be only one person, firm or
corporation named in Schedule I and Schedule II hereto, the term
"Underwriters" and the term "Representatives," as used herein, shall mean
such person, firm or corporation. If the firm or firms listed in
Schedule I hereto are the same as the firm or firms listed in Schedule II
hereto, then the terms "Underwriters" and "Representatives," as used
herein, shall each be deemed to refer to such firm or firms. The term
"successors" as used in this Agreement shall not include any purchaser, as
such purchaser, of any of the Securities from any of the respective
Underwriters.
15. Governing Law: This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
16. Counterparts: This Agreement may be executed by any one or
more of the parties hereto in any number of counterparts, each of which
shall be deemed to be an original, but all such respective counterparts
shall together constitute one and the same instrument.
<PAGE>
If the foregoing is in accordance with your understanding, please
sign and return to us counterparts hereof, and upon the acceptance hereof
by you, this letter and such acceptance hereof shall constitute a binding
agreement between each of the Underwriters and the Company.
Very truly yours,
CMS ENERGY CORPORATION
By:
Accepted: May __, 1997
_____________________________________
_____________________________________
_____________________________________
_____________________________________
As Representatives
By: _________________________________
By:
<PAGE>
Schedule I
_________________________________
_________________________________
_________________________________
_________________________________
_________________________________
Attention: Syndicate Desk
Telecopy:
<PAGE>
Schedule II
Underwriters Principal Amount of Securities
to be Purchased
. . . . . . . . . . . . . . . . . . . . . . . . . . . __________
. . . . . . . . . . . . . . . . . . . . . . . . . . . __________
. . . . . . . . . . . . . . . . . . . . . . . . . . . __________
. . . . . . . . . . . . . . . . . . . . . . . . . . . __________
Total. . . . . . . __________
<PAGE>
Schedule III
Information Regarding the Securities
1. Aggregate Principal Amount:
2. Maturity Date:
3. Interest Rate: ___%
4. Price to be paid to the Company: ___% of the principal amount
<PAGE>
EXHIBIT (4)(a)
THIRD SUPPLEMENTAL INDENTURE
dated as of May __, 1997
____________________
This Third Supplemental Indenture, dated as of the __th
day of May, 1997 between CMS Energy Corporation, a corporation duly
organized and existing under the laws of the State of Michigan
(hereinafter called the "Issuer") and having its principal office at
Fairlane Plaza South, Suite 1100, 330 Town Center Drive, Dearborn,
Michigan 48126, and NBD Bank, a Michigan banking corporation (hereinafter
called the "Trustee") and having its principal Corporate Trust Office at
611 Woodward Avenue, Detroit, Michigan 48226.
WITNESSETH:
WHEREAS, the Issuer and the Trustee (formerly known as NBD
Bank, National Association) entered into an Indenture, dated as of
September 15, 1992 (the "Original Indenture"), pursuant to which one or
more series of debt securities of the Issuer (the "Securities") may be
issued from time to time; and
WHEREAS, Section 2.3 of the Original Indenture permits the
terms of any series of Securities to be established in an indenture
supplemental to the Original Indenture; and
WHEREAS, Section 8.1(e) of the Original Indenture provides
that a supplemental indenture may be entered into by the Issuer and the
Trustee without the consent of any Holders of the Securities to establish
the form and terms of the Securities of any series; and
WHEREAS, the Issuer has requested the Trustee to join with
it in the execution and delivery of this Third Supplemental Indenture in
order to supplement and amend the Original Indenture by, among other
things, establishing the form and terms of a series of Securities to be
known as the Issuer's "__% Senior Unsecured Notes Due 2002" (the "2002
Notes"), providing for the issuance of the 2002 Notes and amending and
adding certain provisions thereof for the benefit of the Holders of the
2002 Notes; and
WHEREAS, the Issuer and the Trustee desire to enter into
this Third Supplemental Indenture for the purposes set forth in Sections
2.3 and 8.1(e) of the Original Indenture as referred to above; and
WHEREAS, the Issuer has furnished the Trustee with a copy
of the resolutions of its Board of Directors certified by its Secretary or
Assistant Secretary authorizing the execution of this Third Supplemental
Indenture; and
WHEREAS, all things necessary to make this Third
Supplemental Indenture a valid agreement of the Issuer and the Trustee and
a valid supplement to the Original Indenture have been done,
NOW, THEREFORE, THIS THIRD SUPPLEMENTAL INDENTURE
WITNESSETH:
For and in consideration of the premises and the purchase
of the 2002 Notes to be issued hereunder by holders thereof, the Issuer
and the Trustee mutually covenant and agree, for the equal and
proportionate benefit of the respective holders from time to time of the
2002 Notes, as follows:
ARTICLE I
STANDARD PROVISIONS; DEFINITIONS
SECTION 1.011. Standard Provisions. The Original
Indenture together with this Third Supplemental Indenture and all previous
indentures supplemental thereto entered into pursuant to the applicable
terms thereof are hereinafter sometimes collectively referred to as the
"Indenture." All capitalized terms which are used herein and not
otherwise defined herein are defined in the Indenture and are used herein
with the same meanings as in the Indenture.
SECTION 1.012. Definitions. Section 1.1 of the Original
Indenture is amended to insert the new definitions applicable to the 2002
Notes, in the appropriate alphabetical sequence, as follows:
"Amortization Expense" means, for any period, amounts
recognized during such period as amortization of capital leases,
depletion, nuclear fuel, goodwill and assets classified as intangible
assets in accordance with generally accepted accounting principles.
"Average Life" means, as of the date of determination,
with respect to any Indebtedness, the quotient obtained by dividing (i)
the sum of the products of (x) the number of years from the date of
determination to the dates of each successive scheduled principal payment
of such Indebtedness and (y) the amount of such principal payment by (ii)
the sum of all such principal payments.
"Capital Lease Obligation" of a Person means any
obligation that is required to be classified and accounted for as a
capital lease on the face of a balance sheet of such Person prepared in
accordance with generally accepted accounting principles; the amount of
such obligation shall be the capitalized amount thereof, determined in
accordance with generally accepted accounting principles; the stated
maturity thereof shall be the date of the last payment of rent or any
other amount due under such lease prior to the first date upon which such
lease may be terminated by the lessee without payment of a penalty; and
such obligation shall be deemed secured by a Lien on any property or
assets to which such lease relates.
"Capital Stock" means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents
of or interests in (however designated) corporate stock, including any
Preferred Stock or Letter Stock.
"Change in Control" means an event or series of events by
which (i) the Issuer ceases to own beneficially, directly or indirectly,
at least 80% of the total voting power of all classes of Capital Stock
then outstanding of Consumers (whether arising from issuance of securities
of the Issuer or Consumers, any direct or indirect transfer of securities
by the Issuer or Consumers, any merger, consolidation, liquidation or
dissolution of the Issuer or Consumers or otherwise); (ii) any "person" or
"group" (as such terms are used in Sections 13(d) and 14(d) of the
Exchange Act) becomes the "beneficial owner" (as such term is used in
Rules 13d-3 and 13d-5 under the Exchange Act, except that a person or
group shall be deemed to have "beneficial ownership" of all shares that
such person or group has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or
indirectly, of more than 35% of the Voting Stock of the Issuer; or (iii)
the Issuer consolidates with or merges into another corporation or
directly or indirectly conveys, transfers or leases all or substantially
all of its assets to any Person, or any corporation consolidates with or
merges into the Issuer, in either event pursuant to a transaction in which
the outstanding Voting Stock of the Issuer is changed into or exchanged
for cash, securities, or other property, other than any such transaction
in which (A) the outstanding Voting Stock of the Issuer is changed into or
exchanged for Voting Stock of the surviving corporation and (B) the
holders of the Voting Stock of the Issuer immediately prior to such
transaction retain, directly or indirectly, substantially proportionate
ownership of the Voting Stock of the surviving corporation immediately
after such transaction.
"CMS Electric and Gas" means CMS Electric and Gas Company,
a Michigan corporation and wholly-owned subsidiary of Enterprises.
"CMS Gas Transmission and Storage" means CMS Gas
Transmission and Storage Company, a Michigan corporation and wholly-owned
subsidiary of Enterprises.
"CMS Generation" means CMS Generation Co., a Michigan
corporation and wholly-owned subsidiary of Enterprises.
"CMS MST" means CMS Marketing, Services and Trading
Company, a Michigan corporation and wholly-owned subsidiary of
Enterprises.
"Consolidated Assets" means, at any date of determination,
the aggregate assets of the Issuer and its Consolidated Subsidiaries
determined on a consolidated basis in accordance with generally accepted
accounting principles.
"Consolidated Capital" means, at any date of
determination, the sum of (a) Consolidated Indebtedness, (b) consolidated
equity of the common stockholders of the Issuer and the Consolidated
Subsidiaries, (c) consolidated equity of the preference stockholders of
the Issuer and the Consolidated Subsidiaries and (d) consolidated equity
of the preferred stockholders of the Issuer and the Consolidated
Subsidiaries, in each case determined at such date in accordance with
generally accepted accounting principles.
"Consolidated Coverage Ratio" with respect to any period
means the ratio of (i) the aggregate amount of Operating Cash Flow for
such period to (ii) the aggregate amount of Consolidated Interest Expense
for such period.
"Consolidated Current Liabilities" means, for any period,
the aggregate amount of liabilities of the Issuer and its Consolidated
Subsidiaries which may properly be classified as current liabilities
(including taxes accrued as estimated), after (i) eliminating all inter-
company items between the Issuer and any Consolidated Subsidiary and (ii)
deducting all current maturities of long-term Indebtedness, all as
determined in accordance with generally accepted accounting principles.
"Consolidated Indebtedness" means, at any date of
determination, the aggregate Indebtedness of the Issuer and its
Consolidated Subsidiaries determined on a consolidated basis in accordance
with generally accepted accounting principles.
"Consolidated Interest Expense" means, for any period, the
total interest expense in respect of Indebtedness of the Issuer and its
Consolidated Subsidiaries, including, without duplication, (i) interest
expense attributable to capital leases, (ii) amortization of debt
discount, (iii) capitalized interest, (iv) cash and noncash interest
payments, (v) commissions, discounts and other fees and charges owed with
respect to letters of credit and bankers' acceptance financing, (vi) net
costs under Interest Rate Protection Agreements (including amortization of
discount) and (vii) interest expense in respect of obligations of other
Persons deemed to be Indebtedness of the Issuer or any Consolidated
Subsidiaries under clause (v) or (vi) of the definition of Indebtedness,
provided, however, that Consolidated Interest Expense shall exclude (a)
any costs otherwise included in interest expense recognized on early
retirement of debt and (b) any interest expense in respect of any
Indebtedness of any Subsidiary of Consumers, CMS Generation, NOMECO, CMS
Electric and Gas, CMS Gas Transmission and Storage, CMS MST or any other
Designated Enterprises Subsidiary, provided that such Indebtedness is
without recourse to any assets of the Issuer, Consumers, Enterprises, CMS
Generation, NOMECO, CMS Electric and Gas, CMS Gas Transmission and
Storage, CMS MST or any other Designated Enterprises Subsidiary.
"Consolidated Net Income" means, for any period, the net
income of the Issuer and its Consolidated Subsidiaries determined on a
consolidated basis in accordance with generally accepted accounting
principles; provided, however, that there shall not be included in such
Consolidated Net Income:
(i) any net income of any Person if such Person is not a
Subsidiary, except that (A) the Issuer's equity in the net income
of any such Person for such period shall be included in such
Consolidated Net Income up to the aggregate amount of cash
actually distributed by such Person during such period to the
Issuer or a Consolidated Subsidiary as a dividend or other
distribution and (B) the Issuer's equity in a net loss of any such
Person for such period shall be included in determining such
Consolidated Net Income;
(ii) any net income of any Person acquired by the Issuer
or a Subsidiary in a pooling of interests transaction for any
period prior to the date of such acquisition;
(iii) any gain or loss realized upon the sale or other
disposition of any property, plant or equipment of the Issuer or
its Consolidated Subsidiaries which is not sold or otherwise
disposed of in the ordinary course of business and any gain or
loss realized upon the sale or other disposition of any Capital
Stock of any Person; and
(iv) any net income of any Subsidiary of Consumers, CMS
Generation, NOMECO, CMS Electric and Gas, CMS Gas Transmission and
Storage, CMS MST or any other Designated Enterprises Subsidiary
whose interest expense is excluded from Consolidated Interest
Expense, provided, however, that for purposes of this subsection
(iv), any cash, dividends or distributions of any such Subsidiary
to the Issuer shall be included in calculating Consolidated Net
Income.
"Consolidated Net Tangible Assets" means, for any period,
the total amount of assets (less accumulated depreciation or amortization,
allowances for doubtful receivables, other applicable reserves and other
properly deductible items) as set forth on the most recently available
quarterly or annual consolidated balance sheet of the Issuer and its
Consolidated Subsidiaries, determined on a consolidated basis in
accordance with generally accepted accounting principles, and after giving
effect to purchase accounting and after deducting therefrom, to the extent
otherwise included, the amounts of: (i) Consolidated Current Liabilities;
(ii) minority interests in Consolidated Subsidiaries held by Persons other
than the Issuer or a Restricted Subsidiary; (iii) excess of cost over fair
value of assets of businesses acquired, as determined in good faith by the
Board of Directors as evidenced by Board resolutions; (iv) any revaluation
or other write-up in value of assets subsequent to December 31, 1996, as a
result of a change in the method of valuation in accordance with generally
accepted accounting principles; (v) unamortized debt discount and expenses
and other unamortized deferred charges, goodwill, patents, trademarks,
service marks, trade names, copyrights, licenses organization or
developmental expenses and other intangible items; (vi) treasury stock;
and (vii) any cash set apart and held in a sinking or other analogous fund
established for the purpose of redemption or other retirement of Capital
Stock to the extent such obligation is not reflected in Consolidated
Current Liabilities.
"Consolidated Net Worth" of any Person means the total of
the amounts shown on the consolidated balance sheet of such Person and its
consolidated subsidiaries, determined on a consolidated basis in
accordance with generally accepted accounting principles, as of any date
selected by such Person not more than 90 days prior to the taking of any
action for the purpose of which the determination is being made (and
adjusted for any material events since such date), as (i) the par or
stated value of all outstanding Capital Stock plus (ii) paid-in capital or
capital surplus relating to such Capital Stock plus (iii) any retained
earnings or earned surplus less (A) any accumulated deficit, (B) any
amounts attributable to Redeemable Stock and (C) any amounts attributable
to Exchangeable Stock.
"Consolidated Subsidiary" means, any Subsidiary whose
accounts are or are required to be consolidated with the accounts of the
Issuer in accordance with generally accepted accounting principles.
"Consumers" means Consumers Energy Company, a Michigan
corporation, all of whose common stock is on the date hereof owned by the
Issuer.
"Designated Enterprises Subsidiary" means any wholly-owned
subsidiary of Enterprises formed after the date of this Third Supplemental
Indenture which is designated a Designated Enterprises Subsidiary by the
Board of Directors.
"Enterprises" means CMS Enterprises Company, a Michigan
corporation and wholly-owned subsidiary of the Issuer.
"Event of Default" with respect to the 2002 Notes has the
meaning specified in Article V of this Third Supplemental Indenture.
"Exchange Act" means the Securities Exchange Act of 1934,
as amended.
"Exchangeable Stock" means any Capital Stock of a
corporation that is exchangeable or convertible into another security
(other than Capital Stock of such corporation that is neither Exchangeable
Stock or Redeemable Stock).
"Indebtedness" of any Person means, without duplication,
(i) the principal of and premium (if any) in respect of
(A) indebtedness of such Person for money borrowed and (B)
indebtedness evidenced by notes, debentures, bonds or other
similar instruments for the payment of which such Person is
responsible or liable;
(ii) all Capital Lease Obligations of such Person;
(iii) all obligations of such Person issued or assumed as
the deferred purchase price of property, all conditional sale
obligations and all obligations under any title retention
agreement (but excluding trade accounts payable arising in the
ordinary course of business);
(iv) all obligations of such Person for the reimbursement
of any obligor on any letter of credit, bankers' acceptance or
similar credit transaction (other than obligations with respect to
letters of credit securing obligations (other than obligations
described in clauses (i) through (iii) above) entered into in the
ordinary course of business of such Person to the extent such
letters of credit are not drawn upon or, if and to the extent
drawn upon, such drawing is reimbursed no later than the third
Business Day following receipt by such Person of a demand for
reimbursement following payment on the letter of credit);
(v) all obligations of the type referred to in clauses
(i) through (iv) of other Persons and all dividends of other
Persons for the payment of which, in either case, such Person is
responsible or liable as obligor, guarantor or otherwise; and
(vi) all obligations of the type referred to in clauses
(i) through (v) of other Persons secured by any Lien on any
property or asset of such Person (whether or not such obligation
is assumed by such Person), the amount of such obligation being
deemed to be the lesser of the value of such property or assets or
the amount of the obligation so secured.
"Interest Payment Date" means November 1, 1997 and each
May 1 and November 1 in each year thereafter.
"Interest Rate Protection Agreement" means any interest
rate swap agreement, interest rate cap agreement or other financial
agreement or arrangement designed to protect the Issuer or any Subsidiary
against fluctuations in interest rates.
"Letter Stock", as applied to the Capital Stock of any
corporation, means Capital Stock of any class or classes (however
designated) which is intended to reflect the separate performance of
certain of the businesses or operations conducted by such corporation or
any of its subsidiaries.
"Lien" means any lien, mortgage, pledge, security
interest, conditional sale, title retention agreement or other charge or
encumbrance of any kind.
"Net Cash Proceeds" means, (a) with respect to any Asset
Sale , the aggregate proceeds of such Asset Sale including the fair market
value (as determined by the Board of Directors and net of any associated
debt and of any consideration other than Capital Stock received in return)
of property other than cash, received by the Issuer, net of (i) brokerage
commissions and other fees and expenses (including fees and expenses of
counsel and investment bankers) related to such Asset Sale, (ii)
provisions for all taxes (whether or not such taxes will actually be paid
or are payable) as a result of such Asset Sale without regard to the
consolidated results of operations of the Issuer and its Restricted
Subsidiaries, taken as a whole, (iii) payments made to repay Indebtedness
or any other obligation outstanding at the time of such Asset Sale that
either (A) is secured by a Lien on the property or assets sold or (B) is
required to be paid as a result of such sale and (iv) appropriate amounts
to be provided by the Issuer or any Restricted Subsidiary of the Issuer as
a reserve against any liabilities associated with such Asset Sale
including, without limitation, pension and other post-employment benefit
liabilities, liabilities related to environmental matters and liabilities
under any indemnification obligations associated with such Asset Sale, all
as determined in conformity with generally accepted accounting principles
and (b) with respect to any issuance or sale or contribution in respect of
Capital Stock, the aggregate proceeds of such issuance, sale or
contribution, including the fair market value (as determined by the Board
of Directors and net of any associated debt and of any consideration other
than Capital Stock received in return) of property other than cash,
received by the Issuer, net of attorneys' fees, accountants' fees,
underwriters' or placement agents' fees, discounts or commissions and
brokerage, consultant and other fees incurred in connection with such
issuance or sale and net of taxes paid or payable as a result thereof,
provided, however, that if such fair market value as determined by the
Board of Directors of property other than cash is greater than $25
million, the value thereof shall be based upon an opinion from an
independent nationally recognized firm experienced in the appraisal or
similar review of similar types of transactions.
"NOMECO" means, CMS NOMECO Oil & Gas Co., a Michigan
corporation and wholly-owned subsidiary of the Issuer.
"Non-Convertible Capital Stock" means, with respect to any
corporation, any non-convertible Capital Stock of such corporation and any
Capital Stock of such corporation convertible solely into non-convertible
Capital Stock other than Preferred Stock of such corporation; provided,
however, that Non-Convertible Capital Stock shall not include any
Redeemable Stock or Exchangeable Stock.
"Operating Cash Flow" means, for any period, with respect
to the Issuer and its Consolidated Subsidiaries, the aggregate amount of
Consolidated Net Income after adding thereto Consolidated Interest Expense
(adjusted to include costs recognized on early retirement of debt), income
taxes, depreciation expense, Amortization Expense and any noncash
amortization of debt issuance costs, any nonrecurring, noncash charges to
earnings and any negative accretion recognition.
"Other Rating Agency" shall mean any one of Duff & Phelps
Credit Rating Co., Fitch Investors Service, L.P. or Moody's Investors
Service, Inc., and any successor to any of these organizations which is a
nationally recognized statistical rating organization.
"Paying Agent" means any person authorized by the Issuer
to pay the principal of (and premium, if any) or interest on any of the
2002 Notes on behalf of the Issuer.
"Predecessor 2002 Note" of any particular 2002 Note means
every previous 2002 Note evidencing all or a portion of the same debt as
that evidenced by such particular 2002 Note; and, for the purposes of the
definition, any 2002 Note authenticated and delivered under Section 2.9 of
the Indenture in exchange for or in lieu of a mutilated, destroyed, lost
or stolen 2002 Note shall be deemed to evidence the same debt as the
mutilated, destroyed, lost or stolen 2002 Note.
"Preferred Stock", as applied to the Capital Stock of any
corporation, means Capital Stock of any class or classes (however
designated) that is preferred as to the payment of dividends, or as to the
distribution of assets upon any voluntary or involuntary liquidation or
dissolution of such corporation, over shares of Capital Stock of any other
class of such corporation.
"Redeemable Stock" means any Capital Stock that by its
terms or otherwise is required to be redeemed prior to the first
anniversary of the Stated Maturity of the Outstanding 2002 Notes or is
redeemable at the option of the holder thereof at any time prior to the
first anniversary of the Stated Maturity of the Outstanding 2002 Notes.
"Restricted Subsidiary" means any Subsidiary (other than
Consumers and its subsidiaries) of the Issuer which, as of the date of the
Issuer's most recent quarterly consolidated balance sheet, constituted at
least 10% of the total Consolidated Assets of the Issuer and its
Consolidated Subsidiaries and any other Subsidiary which from time to time
is designated a Restricted Subsidiary by the Board of Directors provided
that no Subsidiary may be designated a Restricted Subsidiary if,
immediately after giving effect thereto, an Event of Default or event
that, with the lapse of time or giving of notice or both, would constitute
an Event of Default would exist or the Issuer and its Restricted
Subsidiaries could not incur at least $1 of additional Indebtedness under
Section 4.03, and (i) any such Subsidiary so designated as a Restricted
Subsidiary must be organized under the laws of the United States or any
State thereof, (ii) more than 80% of the Voting Stock of such Subsidiary
must be owned of record and beneficially by the Issuer or a Restricted
Subsidiary and (iii) such Restricted Subsidiary must be a Consolidated
Subsidiary.
"Standard & Poor's" shall mean Standard & Poor's Ratings
Group, a division of McGraw Hill Inc., and any successor thereto which is
a nationally recognized statistical rating organization, or if such entity
shall cease to rate the 2002 Notes or shall cease to exist and there shall
be no such successor thereto, any other nationally recognized statistical
rating organization selected by the Issuer which is acceptable to the
Trustee.
"Subordinated Indebtedness" means any Indebtedness of the
Issuer (whether outstanding on the date of this Third Supplemental
Indenture or thereafter incurred) which is contractually subordinated or
junior in right of payment to the 2002 Notes.
"Support Obligations" means, for any person, without
duplication, any financial obligation, contingent or otherwise, of such
person guaranteeing or otherwise supporting any debt or other obligation
of any other person in any manner, whether directly or indirectly, and
including, without limitation, any obligation of such person, direct or
indirect, (i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such debt or to purchase (or to advance or supply
funds for the purchase of) any security for the payment of such debt,
(ii) to purchase property, securities or services for the purpose of
assuring the owner of such debt of the payment of such debt, (iii) to
maintain working capital, equity capital, available cash or other
financial statement condition of the primary obligor so as to enable the
primary obligor to pay such debt, (iv) to provide equity capital under or
in respect of equity subscription arrangements (to the extent that such
obligation to provide equity capital does not otherwise constitute debt),
or (v) to perform, or arrange for the performance of, any non-monetary
obligations or non-funded debt payment obligations of the primary obligor.
"Tax-Sharing Agreement" means the Amended and Restated
Agreement for the Allocation of Income Tax Liabilities and Benefits, dated
January 1, 1994, as amended or supplemented from time to time, by and
among Issuer, each of the members of the Consolidated Group (as defined
therein), and each of the corporations that become members of the
Consolidated Group.
"Voting Stock" means securities of any class or classes
the holders of which are ordinarily, in the absence of contingencies,
entitled to vote for corporate directors (or persons performing similar
functions).
Certain terms, used principally in Articles Three, Four
and Seven of this Third Supplemental Indenture, are defined in those
Articles.
ARTICLE II
DESIGNATION AND TERMS OF THE 2002 NOTES; FORMS
SECTION 2.011. Establishment of Series. (a) There is
hereby created a series of Securities to be known and designated as the
"__% Senior Unsecured Notes Due 2002" and limited in aggregate principal
amount (except as contemplated in Section 2.3(f)(2) of the Indenture) to
$300,000,000. The Stated Maturity of the 2002 Notes is May 1, 2002.
(b) The 2002 Notes will bear interest from the Original
Issue Date, or from the most recent date to which interest has been paid
or duly provided for, at the rate of __% per annum stated therein until
the principal thereof is paid or made available for payment. Interest
will be payable semiannually on each Interest Payment Date and at
Maturity, as provided in the form of the 2002 Note in Section 2.03 hereof.
(c) The Record Date referred to in Section 2.3(f)(4) of
the Indenture for the payment of the interest on any 2002 Note payable on
any Interest Payment Date (other than at Maturity) shall be the 15th day
(whether or not a Business Day) of the calendar month preceding the month
in which such Interest Payment Date occurs and, in the case of interest
payable at Maturity, the Record Date shall be the date of Maturity.
(d) The payment of the principal of, premium (if any) and
interest on the 2002 Notes shall not be secured by a security interest in
any property.
(e) The 2002 Notes shall not be redeemable. The 2002
Notes shall be purchased by the Issuer at the option of the Holders
thereof as provided in Sections 3.01 and 4.05 hereof.
(f) The 2002 Notes shall not be convertible.
(g) The 2002 Notes will not be subordinated to the payment
of Senior Debt.
(h) The Issuer will not pay any additional amounts on the
2002 Notes held by a Person who is not a U.S. Person in respect of any
tax, assessment or government charge withheld or deducted.
(i) The events specified in Events of Default with respect
to the 2002 Notes shall include the events specified in Article Five of
this Third Supplemental Indenture. In addition to the covenants set forth
in Article Three of the Original Indenture, the Holders of the 2002 Notes
shall have the benefit of the covenants of the Issuer set forth in Article
Four hereto.
SECTION 2.012. Forms Generally. The 2002 Notes and
Trustee's certificates of authentication shall be in substantially the
form set forth in this Article, with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted
by the Indenture, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange or as may,
consistently herewith, be determined by the officers executing such 2002
Notes, as evidenced by their execution thereof.
The definitive 2002 Notes shall be printed, lithographed
or engraved on steel engraved borders or may be produced in any other
manner, all as determined by the officers executing such 2002 Notes, as
evidenced by their execution thereof.
SECTION 2.013. Form of Face of 2002 Note.
CMS ENERGY CORPORATION
__% SENIOR UNSECURED NOTES DUE 2002
No. ________ $__________
CMS Energy Corporation, a corporation duly organized and
existing under the laws of the State of Michigan (herein called the
"Issuer", which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
_________________________________, or registered assigns, the principal
sum of ____________________ Dollars on ______________, 2002 and to pay
interest thereon from ________________, 1997 (the "Original Issue Date")
or from the most recent Interest Payment Date to which interest has been
paid or duly provided for, semi-annually on May 1 and November 1 in each
year, commencing November 1, 1997 and at Maturity at the rate of ____% per
annum, until the principal hereof is paid or made available for payment.
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this 2002 Note (or one or more Predecessor 2002
Notes) is registered at the close of business on the Record Date for such
interest, which shall be the 15th day of the calendar month preceding the
month in which such Interest Payment Date occurs (whether or not a
Business Day) except that the Record Date for interest payable at Maturity
shall be the date of Maturity. Any such interest not so punctually paid
or duly provided for will forthwith cease to be payable to the Holder on
such Record Date and may either be paid to the Person in whose name this
2002 Note (or one or more Predecessor 2002 Notes) is registered at the
close of business on a subsequent Record Date (which shall be not less
than five Business Days prior to the date of payment of such defaulted
interest) for the payment of such defaulted interest to be fixed by the
Trustee, notice whereof shall be given to Holders of 2002 Notes not less
than 15 days preceding such subsequent Record Date.
Payment of the principal of (and premium, if any) and interest,
if any, on this 2002 Note will be made at the office or agency of the
Issuer maintained for that purpose in New York, New York (the "Place of
Payment"), 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 Issuer payment of
interest (other than interest payable at Maturity) may be made by check
mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register or by wire transfer to an account
designated by such Person not later than ten days prior to the date of
such payment. If the date on which payment of principal or interest on
this 2002 Note becomes due is not a Business Day, then such principal or
interest shall be due and payable on the next succeeding Business Day.
Reference is hereby made to the further provisions of this 2002
Note set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual
signature, this 2002 Note shall not be entitled to any benefit under the
Indenture or be valid or obligatory for any purpose.
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
duly executed under its corporate seal.
Dated:
CMS ENERGY CORPORATION
By _____________________
Its:
By ______________________
Its:
Attest:
SECTION 2.014. Form of Reverse of 2002 Note.
This __% Senior Unsecured Note Due 2002 is one of a duly
authorized issue of securities of the Issuer (herein called the "2002
Notes"), issued and to be issued under an Indenture, dated as of September
15, 1992, as supplemented by certain supplemental indentures, including
the Third Supplemental Indenture, dated as of May __, 1997 (herein
collectively referred to as the "Indenture"), between the Issuer and NBD
Bank, a Michigan banking corporation (formerly known as NBD Bank, National
Association), 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 Issuer, the Trustee, the Holders of the 2002 Notes and
of the terms upon which the 2002 Notes are, and are to be, authenticated
and delivered. This 2002 Note is one of the series designated on the face
hereof, limited in aggregate principal amount to $300,000,000.
The 2002 Notes are not subject to redemption.
If a Change in Control occurs, the Issuer shall notify the
Holder of this 2002 Note of such occurrence and such Holder shall have the
right to require the Issuer to make a Required Repurchase of all or any
part of this 2002 Note at a Change in Control Purchase Price equal to 101%
of the principal amount of this 2002 Note to be so purchased as more fully
provided in the Indenture and subject to the terms and conditions set
forth therein. In the event of a Required Repurchase of only a portion of
this 2002 Note, a new 2002 Note or Notes for the unrepurchased portion
hereof will be issued in the name of the Holder hereof upon the
cancellation hereof.
If an Event of Default with respect to this 2002 Note shall
occur and be continuing, the principal of this 2002 Note may be declared
due and payable in the manner and with the effect provided in the
Indenture.
In any case where any Interest Payment Date, repurchase date,
Stated Maturity or Maturity of any 2002 Note shall not be a Business Day
at any Place of Payment, then (notwithstanding any other provision of the
Indenture or this 2002 Note), payment of interest or principal (and
premium, if any) need not be made at such Place of Payment on such date,
but may be made on the next succeeding Business Day at such Place of
Payment with the same force and effect as if made on the Interest Payment
Date, repurchase date or at the Stated Maturity or Maturity; provided that
no interest shall accrue on the amount so payable for the period from and
after such Interest Payment Date, redemption date, repurchase date, Stated
Maturity or Maturity, as the case may be, to such Business Day.
The Indenture contains provisions for defeasance at any time of
(i) the entire indebtedness of this 2002 Note or (ii) certain restrictive
covenants and Events of Default with respect to this 2002 Note, in each
case upon compliance with certain conditions set forth therein.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of all Outstanding
2002 Notes under the Indenture at any time by the Issuer and the Trustee
with the consent of the Holders of not less than a majority in principal
amount of Securities of all series then Outstanding and affected (voting
as one class).
The Indenture permits the Holders of not less than a majority in
principal amount of Securities of all series at the time Outstanding with
respect to which a default shall have occurred and be continuing (voting
as one class) to waive on behalf of the Holders of all Outstanding
Securities of such series any past default by the Issuer, provided that no
such waiver may be made with respect to a default in the payment of the
principal of or the interest on any Security of such series or the default
by the Issuer in respect of certain covenants or provisions of the
Indenture, the modification or amendment of which must be consented to by
the Holder of each Outstanding Security of each series affected.
As set forth in, and subject to, the provisions of the
Indenture, no Holder of any 2002 Note will have any right to institute any
proceeding with respect to the Indenture or for any remedy thereunder,
unless such Holder shall have previously given to the Trustee written
notice of a continuing Event of Default, the Holders of not less than 25%
in principal amount of the Outstanding Securities of each affected series
(voting as one class) shall have made written request, and offered
reasonable indemnity, to the Trustee to institute such proceeding as
trustee, and the Trustee shall not have received from the Holders of a
majority in principal amount of the Outstanding Securities of each
affected series (voting as one class) a direction inconsistent with such
request and shall have failed to institute such proceeding within 60 days;
provided, however, that such limitations do not apply to a suit instituted
by the Holder hereof for the enforcement of payment of the principal of
(and premium, if any) or any interest on this 2002 Note on or after the
respective due dates expressed herein.
No reference herein to the Indenture and no provision of this
2002 Note or of the Indenture shall alter or impair the obligation of the
Issuer, which is absolute and unconditional, to pay the principal of and
any premium and interest on this 2002 Note at the times, place and rate,
and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this 2002 Note is registerable in the
Security Register, upon surrender of this 2002 Note for registration of
transfer at the office or agency of the Issuer in any place where the
principal of and any premium and interest on this 2002 Note are payable,
duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Issuer and the Security Registrar duly executed
by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new 2002 Notes of this series and of like tenor, of
authorized denominations and for the same aggregate principal amount, will
be issued to the designated transferee or transferees.
The 2002 Notes are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set
forth, 2002 Notes are exchangeable for a like aggregate principal amount
of 2002 Notes and of like tenor of a different authorized denomination, as
requested by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Issuer may require payment of a sum
sufficient to cover any tax or other governmental charge payable in
connection therewith.
The Issuer shall not be required (i) to issue, register the
transfer of or exchange this 2002 Note for a period of 15 days next
preceding the first mailing of publication of notice of redemption of 2002
Notes, or (ii) to register the transfer of or exchange any 2002 Note
selected, called or being called for redemption, in whole or in part,
except, in the case of any 2002 Note to be redeemed in part, the portion
thereof not to be redeemed.
Prior to due presentment of this 2002 Note for registration of
transfer, the Issuer, the Trustee and any agent of the Issuer or the
Trustee may treat the Person in whose name this 2002 Note is registered as
the owner hereof for all purposes, whether or not this 2002 Note be
overdue, and neither the Issuer, the Trustee nor any such agent shall be
affected by notice to the contrary.
All terms used in this 2002 Note without definition which are
defined in the Indenture shall have the meanings assigned to them in the
Indenture.
SECTION 2.05. Form of Trustee's Certificate of Authentication.
The Trustee's certificates of authentication shall be in substantially the
following form:
<PAGE>
<PAGE>
This is one of the Securities of the series designated herein
referred to in the within-mentioned Indenture.
_____________________________,
as Trustee
By ___________________________
Authorized Officer
ARTICLE III
CHANGE OF CONTROL
SECTION 3.011. Change of Control. Upon the occurrence of a
Change in Control (the effective date of such Change in Control being the
"Change in Control Date"), each Holder of a 2002 Note shall have the right
to require that the Issuer repurchase (a "Required Repurchase") all or any
part of such Holder's 2002 Note at a repurchase price payable in cash
equal to 101% of the principal amount of such 2002 Note plus accrued
interest to the Purchase Date (the "Change in Control Purchase Price").
(a) Within 30 days following the Change in Control Date, the
Issuer shall mail a notice (the "Required Repurchase Notice") to each
Holder with a copy to the Trustee stating:
(i) that a Change in Control has occurred and that such
Holder has the right to require the Issuer to repurchase all or
any part of such Holder's 2002 Notes at the Change of Control
Purchase Price;
(ii) the Change of Control Purchase Price;
(iii) the date on which any Required Repurchase shall be
made (which shall be no earlier than 60 days nor later than 90
days from the date such notice is mailed) (the "Purchase Date");
(iv) the name and address of the Paying Agent; and
(v) the procedures that Holders must follow to cause the
2002 Notes to be repurchased, which shall be consistent with
this Section and the Indenture.
b. Holders electing to have a 2002 Note repurchased must
deliver a written notice (the "Change in Control Purchase Notice") to
the Paying Agent (initially the Trustee) at its corporate trust
office in Detroit, Michigan, or any other office of the Paying Agent
maintained for such purposes, not later than 30 days prior to the
Purchase Date. The Change in Control Purchase Notice shall state:
(i) the portion of the principal amount of any 2002 Notes to be
repurchased, which portion must be $1,000 or an integral multiple
thereof; (ii) that such 2002 Notes are to be repurchased by the
Issuer pursuant to the change in control provisions of the Indenture;
and (iii) unless the 2002 Notes are represented by one or more Global
Notes, the certificate numbers of the 2002 Notes to be delivered by
the Holder thereof for repurchase by the Issuer. Any Change in
Control Purchase Notice may be withdrawn by the Holder by a written
notice of withdrawal delivered to the Paying Agent not later than
three Business Days prior to the Purchase Date. The notice of
withdrawal shall state the principal amount and, if applicable, the
certificate numbers of the 2002 Notes as to which the withdrawal
notice relates and the principal amount of such 2002 Notes, if any,
which remains subject to a Change in Control Purchase Notice.
If a 2002 Note is represented by a Global Note (as described in
Article VI below), the Depositary or its nominee will be the Holder
of such 2002 Note and therefore will be the only entity that can
elect a Required Repurchase of such 2002 Note. To obtain repayment
pursuant to this Section 3.01 with respect to such 2002 Note, the
beneficial owner of such 2002 Note must provide to the broker or
other entity through which it holds the beneficial interest in such
2002 Note (i) the Change in Control Purchase Notice signed by such
beneficial owner, and such signature must be guaranteed by a member
firm of a registered national securities exchange or of the National
Association of Securities Dealers, Inc. or a commercial bank or trust
company having an office or correspondent in the United States, and
(ii) instructions to such broker or other entity to notify the
Depositary of such beneficial owner's desire to obtain repayment
pursuant to this Section 3.01. Such broker or other entity will
provide to the Paying Agent (i) the Change of Control Purchase Notice
received from such beneficial owner and (ii) a certificate
satisfactory to the Paying Agent from such broker or other entity
stating that it represents such beneficial owner. Such broker or
other entity will be responsible for disbursing any payments it
receives pursuant to this Section 3.01 to such beneficial owner.
(c) Payment of the Change of Control Purchase Price for a 2002
Note for which a Change in Control Purchase Notice has been delivered
and not withdrawn is conditioned (except in the case of a 2002 Note
represented by one or more Global Notes) upon delivery of such 2002
Note (together with necessary endorsements) to the Paying Agent at
its office in Detroit, Michigan, or any other office of the Paying
Agent maintained for such purpose, at any time (whether prior to, on
or after the Purchase Date) after the delivery of such Change in
Control Purchase Notice. Payment of the Change of Control Purchase
Price for such 2002 Note will be made promptly following the later of
the Purchase Date or the time of delivery of such 2002 Note. If the
Paying Agent holds, in accordance with the terms of the Indenture,
money sufficient to pay the Change in Control Purchase Price of such
2002 Note on the Business Day following the Purchase Date, then, on
and after such date, interest will cease accruing, and all other
rights of the Holder shall terminate (other than the right to receive
the Change of Control Purchase Price upon delivery of the 2002 Note).
(d) The Issuer shall comply with the provisions of Regulation
14E and any other tender offer rules under the Exchange Act, which
may then be applicable in connection with any offer by the Issuer to
repurchase 2002 Notes at the option of Holders upon a Change in
Control.
(e) No 2002 Note may be repurchased by the Issuer as a result
of a Change in Control if there has occurred and is continuing an
Event of Default (other than a default in the Payment of the Change
in Control Purchase Price with respect to the 2002 Notes).
ARTICLE IV
ADDITIONAL COVENANTS OF THE ISSUER
WITH RESPECT TO THE 2002 NOTES
SECTION 4.011. Limitation on Certain Liens. (a) So long as
any of the 2002 Notes are outstanding, the Issuer shall not create, incur,
assume or suffer to exist any lien, mortgage, pledge, security interest,
conditional sale, title retention agreement or other charge or encumbrance
of any kind, or any other type of arrangement intended or having the
effect of conferring upon a creditor of the Issuer or any Subsidiary a
preferential interest (hereinafter in this Section referred to as a
"Lien") upon or with respect to any of its property of any character,
including without limitation any shares of Capital Stock of Consumers or
Enterprises, without making effective provision whereby the 2002 Notes
shall (so long as any such other creditor shall be so secured) be equally
and ratably secured (along with any other creditor similarly entitled to
be secured) by a direct Lien on all property subject to such Lien,
provided, however, that the foregoing restrictions shall not apply to:
(i) Liens for taxes, assessments or governmental charges or levies
to the extent not past due;
(ii) pledges or deposits to secure (a) obligations under workmen's
compensation laws or similar legislation, (b) statutory obligations of the
Issuer or (c) Support Obligations at any one time outstanding;
(iii) Liens imposed by law, such as materialmen's, mechanics',
carriers', workmen's and repairmen's Liens and other similar Liens arising
in the ordinary course of business securing obligations which are not
overdue or which have been fully bonded and are being contested in good
faith;
(iv) purchase money Liens upon or in property acquired and held by
the Issuer in the ordinary course of business to secure the purchase price
of such property or to secure Indebtedness incurred solely for the purpose
of financing the acquisition of any such property to be subject to such
Liens, or Liens existing on any such property at the time of acquisition,
or extensions, renewals or replacements of any of the foregoing for the
same or a lesser amount, provided that no such Lien shall extend to or
cover any property other than the property being acquired and no such
extension, renewal or replacement shall extend to or cover property not
theretofore subject to the Lien being extended, renewed or replaced, and
provided, further, that the aggregate principal amount of the Indebtedness
at any one time outstanding secured by Liens permitted by this clause (iv)
shall not exceed $10,000,000; and
(v) Liens not otherwise permitted by clauses (i) through (iv) of
this Section securing Indebtedness of the Issuer; provided that on the
date such Liens are created, and after giving effect to such Indebtedness,
the aggregate principal amount at maturity of all of the secured
Indebtedness of the Issuer at such date shall not exceed 5% of
Consolidated Net Tangible Assets at such date.
SECTION 4.012. Limitation on Consolidation, Merger, Sale or
Conveyance. So long as any of the 2002 Notes are Outstanding and until
the 2002 Notes are rated BBB- or above (or an equivalent rating) by
Standard & Poor's and one Other Rating Agency (or, if Standard & Poor's
shall change its rating system, an equivalent of such rating then employed
by such organization), and subject also to Article Nine of the Indenture,
at which time the Issuer will be permanently released from the provisions
of this Section 4.02, the Issuer shall not consolidate with or merge into
any other Person or sell, lease or convey the property of the Issuer in
the entirety or substantially as an entirety, unless (i) immediately after
giving effect to such transaction the Consolidated Net Worth of the
surviving entity is at least equal to the Consolidated Net Worth of the
Issuer immediately prior to the transaction, and (ii) after giving effect
to such transaction, the surviving entity would be entitled to incur at
least one dollar of additional Indebtedness (other than revolving
Indebtedness to banks) without violation of the limitations in Section
4.03 hereof.
SECTION 4.013. Limitation on Consolidated Indebtedness.
(a) So long as any of the 2002 Notes are Outstanding and until the 2002
Notes are rated BBB- or above (or an equivalent rating) by Standard &
Poor's and one Other Rating Agency (or, if Standard & Poor's shall change
its rating system, an equivalent of such rating then employed by such
organization), at which time the Issuer will be permanently released from
the provisions of this Section 4.03, the Issuer shall not, and shall not
permit any Consolidated Subsidiary of the Issuer to, issue, create,
assume, guarantee, incur or otherwise become liable for (collectively,
"issue"), directly or indirectly, any Indebtedness unless the Consolidated
Coverage Ratio of the Issuer and its Consolidated Subsidiaries for the
four consecutive fiscal quarters immediately preceding the issuance of
such Indebtedness (as shown by a pro forma consolidated income statement
of the Issuer and its Consolidated Subsidiaries for the four most recent
fiscal quarters ending at least 30 days prior to the issuance of such
Indebtedness after giving effect to (i) the issuance of such Indebtedness
and (if applicable) the application of the net proceeds thereof to
refinance other Indebtedness as if such Indebtedness was issued at the
beginning of the period, (ii) the issuance and retirement of any other
Indebtedness since the first day of the period as if such Indebtedness was
issued or retired at the beginning of the period and (iii) the acquisition
of any company or business acquired by the Issuer or any Subsidiary since
the first day of the period (including giving effect to the pro forma
historical earnings of such company or business), including any
acquisition which will be consummated contemporaneously with the issuance
of such Indebtedness, as if in each case such acquisition occurred at the
beginning of the period) exceeds a ratio of 1.7 to 1.0.
(b) Notwithstanding the foregoing paragraph, the Issuer or any
Restricted Subsidiary may issue, directly or indirectly, the following
Indebtedness:
(1) Indebtedness of the Issuer to banks not to exceed
$1,000,000,000 in aggregate outstanding principal amount at any time;
(2) Indebtedness (other than Indebtedness described in clause
(1) of this Subsection) outstanding on the date of this Third
Supplemental Indenture, as set forth on Schedule 4.03(b)(2) attached
hereto and made a part hereof, and Indebtedness issued in exchange
for, or the proceeds of which are used to refund or refinance, any
Indebtedness permitted by this clause (2); provided, however, that
(i) the principal amount (or accreted value in the case of
Indebtedness issued at a discount) of the Indebtedness so issued
shall not exceed the principal amount (or accreted value in the case
of Indebtedness issued at a discount) of, premium, if any, and
accrued but unpaid interest on, the Indebtedness so exchanged,
refunded or refinanced and (ii) the Indebtedness so issued (A) shall
not mature prior to the stated maturity of the Indebtedness so
exchanged, refunded or refinanced, (B) shall have an Average Life
equal to or greater than the remaining Average Life of the
Indebtedness so exchanged, refunded or refinanced and (C) if the
Indebtedness to be exchanged, refunded or refinanced is subordinated
to the 2002 Notes, the Indebtedness is subordinated to the 2002 Notes
in right of payment;
(3) Indebtedness of the Issuer owed to and held by a Subsidiary
and Indebtedness of a Subsidiary owed to and held by the Issuer;
provided, however, that, in the case of Indebtedness of the Issuer
owed to and held by a Subsidiary, (i) any subsequent issuance or
transfer of any Capital Stock that results in any such Subsidiary
ceasing to be a Subsidiary or (ii) any transfer of such Indebtedness
(except to the Issuer or a Subsidiary) shall be deemed for the
purposes of this Subsection to constitute the issuance of such
Indebtedness by the Issuer;
(4) Indebtedness of the Issuer issued in exchange for, or the
proceeds of which are used to refund or refinance, Indebtedness of
the Issuer issued in accordance with Subsection (a) of this Section,
provided that (i) the principal amount (or accreted value in the case
of Indebtedness issued at a discount) of the Indebtedness so issued
shall not exceed the principal amount (or accreted value in the case
of Indebtedness issued at a discount) of, premium, if any, and
accrued but unpaid interest on, the Indebtedness so exchanged,
refunded or refinanced and (ii) the Indebtedness so issued (A) shall
not mature prior to the stated maturity of the Indebtedness so
exchanged, refunded or refinanced, (B) shall have an Average Life
equal to or greater than the remaining Average Life of the
Indebtedness so exchanged, refunded or refinanced and (C) if the
Indebtedness to be exchanged, refunded or refinanced is subordinated
to the 2002 Notes, the Indebtedness so issued is subordinated to the
2002 Notes in right of payment;
(5) Indebtedness of a Restricted Subsidiary issued in exchange
for, or the proceeds of which are used to refund or refinance,
Indebtedness of a Restricted Subsidiary issued in accordance with
Subsection (a) of this Section, provided that (i) the principal
amount (or accreted value in the case of Indebtedness issued at a
discount) of the Indebtedness so issued shall not exceed the
principal amount (or accreted value in the case of Indebtedness
issued at a discount) of, premium, if any, and accrued but unpaid
interest on, the Indebtedness so exchanged, refunded or refinanced
and (ii) the Indebtedness so issued (A) shall not mature prior to the
stated maturity of the Indebtedness so exchanged, refunded or
refinanced and (B) shall have an Average Life equal to or greater
than the remaining Average Life of the Indebtedness so exchanged,
refunded or refinanced.
(6) Indebtedness of a Consolidated Subsidiary issued to
acquire, develop, improve, construct or to provide working capital
for a gas, oil or electric generation, exploration, production,
distribution, storage or transmission facility and related assets,
provided that such Indebtedness is without recourse to any assets of
the Issuer, Consumers, Enterprises, CMS Generation, NOMECO, CMS
Electric and Gas, CMS Gas Transmission and Storage, CMS MST or any
other Designated Enterprises Subsidiary;
(7) Indebtedness of a Person existing at the time at which such
person became a Subsidiary and not incurred in connection with, or in
contemplation of, such Person becoming a Subsidiary. Such
Indebtedness shall be deemed to be incurred on the date the acquired
Person becomes a Consolidated Subsidiary;
(8) Indebtedness issued by the Issuer not to exceed
$150,000,000 in aggregate principal amount at any time; and
(9) Indebtedness of a Consolidated Subsidiary in respect of
rate reduction bonds issued to recover electric restructuring
transition costs of Consumers provided that such Indebtedness is
without recourse to the assets of Consumers.
SECTION 4.014. Limitation on Restricted Payments. (a) So long
as the 2002 Notes are Outstanding and until the 2002 Notes are rated BBB-
or above (or an equivalent rating) by Standard & Poor's and one Other
Rating Agency (or, if Standard & Poor's shall change its rating system, an
equivalent of such rating then employed by such organization), at which
time the Issuer will be permanently released from the provisions of this
Section 4.04, the Issuer shall not, and shall not permit any Restricted
Subsidiary of the Issuer, directly or indirectly, to (i) declare or pay
any dividend or make any distribution on the Capital Stock of the Issuer
to the direct or indirect holders of its Capital Stock (except dividends
or distributions payable solely in its Non-Convertible Capital Stock or in
options, warrants or other rights to purchase such Non-Convertible Capital
Stock and except dividends or distributions payable to the Issuer or a
Subsidiary), (ii) purchase, redeem or otherwise acquire or retire for
value any Capital Stock of the Issuer, or (iii) purchase, repurchase,
redeem, defease or otherwise acquire or retire for value, prior to
scheduled maturity or scheduled repayment thereof, any Subordinated
Indebtedness (any such dividend, distribution, purchase, redemption,
repurchase, defeasing, other acquisition or retirement being hereinafter
referred to as a "Restricted Payment") if at the time the Issuer or such
Subsidiary makes such Restricted Payment:
(1) an Event of Default, or an event that with the lapse
of time or the giving of notice or both would constitute an Event of
Default, shall have occurred and be continuing (or would result
therefrom); or
(2) the aggregate amount of such Restricted Payment and
all other Restricted Payments made since the date of this Third
Supplemental Indenture would exceed the sum of:
(A) $100,000,000;
(B) 100% of Consolidated Net Income, accrued during the
period (treated as one accounting period) from the date of this
Third Supplemental Indenture to the end of the most recent
fiscal quarter ending at least 45 days prior to the date of such
Restricted Payment (or, in case such sum shall be a deficit,
minus 100% of the deficit); and
(C) the aggregate Net Cash Proceeds received by the Issuer
from the issue or sale of or contribution with respect to its
Capital Stock subsequent to the date of this Third Supplemental
Indenture.
For the purpose of determining the amount of any Restricted Payment not in
the form of cash, the amount shall be the fair value of such Restricted
Payment as determined in good faith by the Board of Directors, provided
that if the value of the non-cash portion of such Restricted Payment as
determined by the Board of Directors is in excess of $25 million, such
value shall be based on the opinion from a nationally recognized firm
experienced in the appraisal of similar types of transactions.
(b) The provisions of Section 4.04(a) shall not prohibit:
(i) any purchase or redemption of Capital Stock of the
Issuer made by exchange for, or out of the proceeds of the
substantially concurrent sale of, Capital Stock of the Issuer
(other than Redeemable Stock or Exchangeable Stock); provided,
however, that such purchase or redemption shall be excluded from
the calculation of the amount of Restricted Payments;
(ii) dividends or other distributions paid in respect of
any class of the Issuer's Capital Stock issued in respect of the
acquisition of any business or assets by the Issuer or a
Restricted Subsidiary if the dividends or other distributions
with respect to such Capital Stock are payable solely from the
net earnings of such business or assets;
(iii) dividends paid within 60 days after the date of
declaration thereof if at such date of declaration such dividend
would have complied with this Section; provided, however, that
at the time of payment of such dividend, no Event of Default
shall have occurred and be continuing (or result therefrom), and
provided further, however, that such dividends shall be included
(without duplication) in the calculation of the amount of
Restricted Payments; or
(iv) payments pursuant to the Tax-Sharing Agreement.
SECTION 4.015. Limitation on Asset Sales. So long as any of
the 2002 Notes are outstanding, the Issuer may not sell, transfer or
otherwise dispose of any property or assets of the Issuer, including
Capital Stock of any Consolidated Subsidiary, in one transaction or a
series of transactions in an amount which exceeds $50,000,000 (an "Asset
Sale") unless the Issuer shall (i) apply an amount equal to such excess
Net Cash Proceeds to permanently repay Indebtedness of a Consolidated
Subsidiary or Indebtedness of the Issuer which is pari passu with the 2002
Notes or (ii) invest an equal amount not so used in clause (i) in property
or assets of related business within 24 months after the date of the Asset
Sale (the "Application Period") or (iii) apply such excess Net Cash
Proceeds not so used in (i) or (ii) (the "Excess Proceeds") to make an
offer, within 30 days after the end of the Application Period, to purchase
from the Holders on a pro rata basis an aggregate principal amount of 2002
Notes on the relevant purchase date equal to the Excess Proceeds on such
date, at a purchase price equal to 100% of the principal amount of the
2002 Notes on the relevant purchase date and unpaid interest, if any, to
the purchase date. The Issuer shall only be required to make an offer to
purchase 2002 Notes from Holders pursuant to subsection (iii) if the
Excess Proceeds equal or exceed $25,000,000 at any given time.
The procedures to be followed by the Issuer in making an offer
to purchase 2002 Notes from the Holders with Excess Proceeds, and for the
acceptance of such offer by the Holders, shall be the same as those set
forth in Section 3.01 herein with respect to a Change in Control.
ARTICLE V
ADDITIONAL EVENTS OF DEFAULT
WITH RESPECT TO THE 2002 NOTES
SECTION 5.011. Definition. All of the events specified in
clauses (a) through (h) of Section 5.1 of the Original Indenture shall be
"Events of Default" with respect to the 2002 Notes.
SECTION 5.012. Amendments to Section 5.1 of the Original
Indenture. Solely for the purpose of determining Events of Default with
respect to the 2002 Notes, paragraphs (e), (f) and (h) of Section 5.1 of
the Original Indenture shall be amended such that each and every reference
therein to the Issuer shall be deemed to mean either the Issuer or
Consumers.
ARTICLE VI
GLOBAL NOTES
The 2002 Notes will be issued initially in the form of Global
Notes. "Global Note" means a registered 2002 Note evidencing one or more
2002 Notes issued to a depositary (the "Depositary") or its nominee, in
accordance with this Article and bearing the legend prescribed in this
Article. A single Global Note will represent all 2002 Notes. The Issuer
shall execute and the Trustee shall, in accordance with this Article and
the Issuer Order with respect to the 2002 Notes, authenticate and deliver
one or more Global Notes in temporary or permanent form that (i) shall
represent and shall be denominated in an aggregate amount equal to the
aggregate principal amount of the 2002 Notes to be represented by such
Global Note or Notes, (ii) shall be registered in the name of the
Depositary for such Global Note or Notes or the nominee of such
Depositary, (iii) shall be delivered by the Trustee to such Depositary or
pursuant to such Depositary's instructions and (iv) shall bear a legend
substantially to the following effect: "Unless and until it is exchanged
in whole or in part for 2002 Notes in definitive registered form, this
Global 2002 Note may not be transferred except as a whole by the
Depository to the nominee of the Depository or by a nominee of the
Depository to the Depository or another nominee of the Depository or by
the Depository or any such nominee to a successor Depository or a nominee
of such successor Depository."
Notwithstanding Section 2.8 of the Indenture, unless and until
it is exchanged in whole or in part for 2002 Notes in definitive form, a
Global Note representing one or more 2002 Notes may not be transferred
except as a whole by the Depositary, to a nominee of such Depositary or by
a nominee of such Depositary to such Depositary or another nominee of such
Depositary or by such Depositary or any such nominee to a successor
Depositary for 2002 Notes or a nominee of such successor Depositary.
If at any time the Depositary for the 2002 Notes is unwilling or
unable to continue as Depositary for the 2002 Notes, the Issuer shall
appoint a successor Depositary with respect to the 2002 Notes. If a
successor Depositary for the 2002 Notes is not appointed by the Issuer by
the earlier of (i) 90 days from the date the Issuer receives notice to the
effect that the Depositary is unwilling or unable to act, or the Issuer
determines that the Depositary is unable to act or (ii) the effectiveness
of the Depositary's resignation or failure to fulfill its duties as
Depositary, the Issuer will execute, and the Trustee, upon receipt of a
Issuer Order for the authentication and delivery of definitive 2002 Notes,
will authenticate and deliver 2002 Notes in definitive form in an
aggregate principal amount equal to the principal amount of the Global
Note or Notes representing such 2002 Notes in exchange for such Global
Note or Notes.
The Issuer may at any time and in its sole discretion determine
that the 2002 Notes issued in the form of one or more Global Notes shall
no longer be represented by such Global Note or Notes. In such event the
Issuer will execute, and the Trustee, upon receipt of a Issuer Order for
the authentication and delivery of definitive 2002 Notes, will
authenticate and deliver 2002 Notes in definitive form in an aggregate
principal amount equal to the principal amount of the Global Note or Notes
representing such 2002 Notes in exchange for such Global Note or Notes.
The Depositary for such 2002 Notes may surrender a Global Note
or Notes for such 2002 Notes in exchange in whole or in part for 2002
Notes in definitive form on such terms as are acceptable to the Issuer and
such Depositary. Thereupon, the Issuer shall execute, and the Trustee
shall authenticate and deliver, without service charge:
(i) to each Person specified by such Depositary a new 2002
Note or Notes, of any authorized denomination as requested by
such Person in aggregate principal amount equal to and in
exchange for such Person's beneficial interest in the Global
Note; and
(ii) to such Depositary a new Global Note in a denomination
equal to the difference, if any, between the principal amount of
the surrendered Global Note and the aggregate principal amount
of 2002 Notes in definitive form delivered to Holders thereof.
In any exchange provided for in this Article, the Issuer will
execute and the Trustee will authenticate and deliver 2002 Notes in
definitive registered form in authorized denominations.
Upon the exchange of a Global Note for 2002 Notes in definitive
form, such Global Note shall be cancelled by the Trustee. 2002 Notes in
definitive form issued in exchange for a Global Note pursuant to this
Article shall be registered in such names and in such authorized
denominations as the Depositary for such Global Note, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee or Security Registrar. The Trustee shall deliver
such 2002 Notes to the persons in whose names such 2002 Notes are so
registered.
ARTICLE VII
DEFEASANCE
All of the provisions of Article Ten of the Original Indenture
shall be applicable to the 2002 Notes. Upon satisfaction by the Issuer of
the requirements of Section 10.1(c) of the Indenture, in connection with
any covenant defeasance (as provided in Section 10.1(c) of the Indenture),
the Issuer shall be released from its obligations under Article Nine of
the Original Indenture and under Articles III and IV of this Third
Supplemental Indenture with respect to the 2002 Notes.
ARTICLE VIII
SUPPLEMENTAL INDENTURES
This Third Supplemental Indenture is a supplement to the
Original Indenture. As supplemented by this Third Supplemental Indenture,
the Original Indenture is in all respects ratified, approved and
confirmed, and the Original Indenture and this Third Supplemental
Indenture shall together constitute one and the same instrument.
TESTIMONIUM
This Third Supplemental Indenture may be executed in any number
of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and
the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Third
Supplemental Indenture to be duly executed and their respective corporate
seals to be hereunto affixed and attested, all as of the day and year
first written above.
CMS ENERGY CORPORATION
By: ____________________________
Attest:
(Corporate Seal)
NBD BANK
as Trustee
By: ______________________________
Attest:
(Corporate Seal)
<PAGE>
<PAGE>
Schedule 4.03(b)(2)
Indebtedness of CMS Energy Corporation outstanding on ______, 1997
<PAGE>
EXHIBIT (4)(a)(iv)
THIRD SUPPLEMENTAL INDENTURE
dated as of March 17, 1997
____________________
This Third Supplemental Indenture, dated as of the 17th day
of March, 1997 between CMS Energy Corporation, a corporation duly
organized and existing under the laws of the State of Michigan
(hereinafter called the "Company") and having its principal office at
Fairlane Plaza South, Suite 1100, 330 Town Center Drive, Dearborn,
Michigan 48126, and The Chase Manhattan Bank, a New York banking
corporation (hereinafter called the "Trustee") and having its principal
Corporate Trust Office at 450 West 33rd Street, 15th Floor, New York, New
York 10001.
WITNESSETH:
WHEREAS, the Company and the Trustee entered into an
Indenture, dated as of January 15, 1994 (the "Original Indenture"),
pursuant to which one or more series of debt securities of the Company
(the "Securities") may be issued from time to time; and
WHEREAS, Section 301 of the Original Indenture permits the
terms of any series of Securities to be established in an indenture
supplemental to the Original Indenture; and
WHEREAS, Section 901(7) of the Original Indenture provides
that a supplemental indenture may be entered into by the Company and the
Trustee without the consent of any Holders of the Securities to establish
the form and terms of the Securities of any series; and
WHEREAS, the Company has requested the Trustee to join with
it in the execution and delivery of this Third Supplemental Indenture in
order to supplement and amend the Original Indenture by, among other
things, establishing the form and terms of a series of Securities to be
known as the Company's "General Term Notes(R), Series C (the "General Term
Notes"), providing for the issuance of the General Term Notes and amending
and adding certain provisions thereof for the benefit of the Holders of
the General Term Notes; and
WHEREAS, the Company and the Trustee desire to enter into
this Third Supplemental Indenture for the purposes set forth in Sections
301 and 901(7) of the Original Indenture as referred to above; and
WHEREAS, all things necessary to make this Third
Supplemental Indenture a valid agreement of the Company and the Trustee
and a valid supplement to the Original Indenture have been done,
___________________________
(R) Registered servicemark of J. W. Korth & Company
NOW, THEREFORE, THIS THIRD SUPPLEMENTAL INDENTURE
WITNESSETH:
For and in consideration of the premises and the purchase of
the General Term Notes to be issued hereunder by holders thereof, the
Company and the Trustee mutually covenant and agree, for the equal and
proportionate benefit of the respective holders from time to time of the
General Term Notes, as follows:
ARTICLE I
STANDARD PROVISIONS; DEFINITIONS
SECTION 101. Standard Provisions. The Original Indenture
together with this Third Supplemental Indenture and all indentures
supplemental thereto entered into pursuant to the applicable terms thereof
are hereinafter sometimes collectively referred to as the "Indenture."
All of the terms, conditions, covenants and provisions contained in the
Original Indenture as heretofore supplemented are incorporated herein by
reference in their entirety and, except as specifically noted herein or
unless the context otherwise requires, shall be deemed to be a part hereof
to the same extent as if such provisions had been set forth in full
herein. All capitalized terms which are used herein and not otherwise
defined herein are defined in the Indenture and are used herein with the
same meanings as in the Indenture.
SECTION 102. Definitions. Section 101 of the Indenture is
amended to insert the new definitions applicable to the General Term
Notes, in the appropriate alphabetical sequence, as follows:
"Amortization Expense" means, for any period, amounts
recognized during such period as amortization of capital leases,
depletion, nuclear fuel, goodwill and assets classified as intangible
assets in accordance with generally accepted accounting principles.
"Average Life" means, as of the date of determination, with
respect to any Indebtedness, the quotient obtained by dividing (i) the sum
of the products of (x) the number of years from the date of determination
to the dates of each successive scheduled principal payment of such
Indebtedness and (y) the amount of such principal payment by (ii) the sum
of all such principal payments.
"Capital Lease Obligation" of a Person means any obligation
that is required to be classified and accounted for as a capital lease on
the face of a balance sheet of such Person prepared in accordance with
generally accepted accounting principles; the amount of such obligation
shall be the capitalized amount thereof, determined in accordance with
generally accepted accounting principles; the stated maturity thereof
shall be the date of the last payment of rent or any other amount due
under such lease prior to the first date upon which such lease may be
terminated by the lessee without payment of a penalty; and such obligation
shall be deemed secured by a Lien on any property or assets to which such
lease relates.
"Capital Stock" means any and all shares, interests, rights
to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) corporate stock, including any Preferred
Stock or Letter Stock.
"Change in Control" means an event or series of events by
which (i) the Company ceases to own beneficially, directly or indirectly,
at least 80% of the total voting power of all classes of Capital Stock
then outstanding of Consumers (whether arising from issuance of securities
of the Company or Consumers, any direct or indirect transfer of securities
by the Company or Consumers, any merger, consolidation, liquidation or
dissolution of the Company or Consumers or otherwise); (ii) any "person"
or "group" (as such terms are used in Sections 13(d) and 14(d) of the
Exchange Act) becomes the "beneficial owner" (as such term is used in
Rules 13d-3 and 13d-5 under the Exchange Act, except that a person or
group shall be deemed to have "beneficial ownership" of all shares that
such person or group has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or
indirectly, of more than 30% of the Voting Stock of the Company; or (iii)
the Company consolidates with or merges into another corporation or
directly or indirectly conveys, transfers or leases all or substantially
all of its assets to any Person, or any corporation consolidates with or
merges into the Company, in either event pursuant to a transaction in
which the outstanding Voting Stock of the Company is changed into or
exchanged for cash, securities, or other property, other than any such
transaction in which (A) the outstanding Voting Stock of the Company is
changed into or exchanged for Voting Stock of the surviving corporation
and (B) the holders of the Voting Stock of the Company immediately prior
to such transaction retain, directly or indirectly, substantially
proportionate ownership of the Voting Stock of the surviving corporation
immediately after such transaction.
"Consolidated Assets" means, at any date of determination,
the aggregate assets of the Company and its Consolidated Subsidiaries
determined on a consolidated basis in accordance with generally accepted
accounting principles.
"Consolidated Capital" means, at any date of determination,
the sum of (a) Consolidated Indebtedness, (b) consolidated equity of the
common stockholders of the Company and the Consolidated Subsidiaries, (c)
consolidated equity of the preference stockholders of the Company and the
Consolidated Subsidiaries and (d) consolidated equity of the preferred
stockholders of the Company and the Consolidated Subsidiaries, in each
case determined at such date in accordance with generally accepted
accounting principles.
"Consolidated Coverage Ratio" with respect to any period
means the ratio of (i) the aggregate amount of Operating Cash Flow for
such period to (ii) the aggregate amount of Consolidated Interest Expense
for such period.
"Consolidated Indebtedness" means, at any date of
determination, the aggregate Indebtedness of the Company and its
Consolidated Subsidiaries determined on a consolidated basis in accordance
with generally accepted accounting principles.
"Consolidated Interest Expense" means, for any period, the
total interest expense in respect of Indebtedness of the Company and its
Consolidated Subsidiaries, including, without duplication, (i) interest
expense attributable to capital leases, (ii) amortization of debt
discount, (iii) capitalized interest, (iv) cash and noncash interest
payments, (v) commissions, discounts and other fees and charges owed with
respect to letters of credit and bankers' acceptance financing, (vi) net
costs under Interest Rate Protection Agreements (including amortization of
discount) and (vii) interest expense in respect of obligations of other
Persons deemed to be Indebtedness of the Company or any Consolidated
Subsidiaries under clause (v) or (vi) of the definition of Indebtedness,
provided, however, that Consolidated Interest Expense shall exclude any
costs otherwise included in interest expense recognized on early
retirement of debt.
"Consolidated Leverage Ratio" means, at any date of
determination, the ratio of Consolidated Indebtedness to Consolidated
Capital.
"Consolidated Net Income" means, for any period, the net
income of the Company and its Consolidated Subsidiaries determined on a
consolidated basis in accordance with generally accepted accounting
principles; provided, however, that there shall not be included in such
Consolidated Net Income:
(i) any net income of any Person if such Person is not a
Subsidiary, except that (A) the Company's equity in the net income
of any such Person for such period shall be included in such
Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Person during such period to the Company or a
Consolidated Subsidiary as a dividend or other distribution and (B)
the Company's equity in a net loss of any such Person for such
period shall be included in determining such Consolidated Net
Income;
(ii) any net income of any Person acquired by the Company
or a Subsidiary in a pooling of interests transaction for any
period prior to the date of such acquisition; and
(iii) any gain or loss realized upon the sale or other
disposition of any property, plant or equipment of the Company or
its Consolidated Subsidiaries which is not sold or otherwise
disposed of in the ordinary course of business and any gain or loss
realized upon the sale or other disposition of any Capital Stock of
any Person.
"Consolidated Net Worth" of any Person means the total of
the amounts shown on the consolidated balance sheet of such Person and its
consolidated subsidiaries, determined on a consolidated basis in
accordance with generally accepted accounting principles, as of any date
selected by such Person not more than 90 days prior to the taking of any
action for the purpose of which the determination is being made (and
adjusted for any material events since such date), as (i) the par or
stated value of all outstanding Capital Stock plus (ii) paid-in capital or
capital surplus relating to such Capital Stock plus (iii) any retained
earnings or earned surplus less (A) any accumulated deficit, (B) any
amounts attributable to Redeemable Stock and (C) any amounts attributable
to Exchangeable Stock.
"Consolidated Subsidiary" means, any Subsidiary whose
accounts are or are required to be consolidated with the accounts of the
Company in accordance with generally accepted accounting principles.
"Consumers" means Consumers Power Company, a Michigan
corporation, all of whose common stock is on the date hereof owned by the
Company.
"Credit Agreement" means the Credit Agreement dated as of
November 21, 1995, as amended from time to time, among the Company, the
banks named therein, Citibank, N.A., and Union Bank, as Co-Agents,
Citibank, N.A., as Documentation Agent, and Union Bank, as Operational
Agent.
"Duff & Phelps" shall mean Duff & Phelps Credit Rating Co.,
and any successor thereto which is a nationally recognized statistical
rating organization, or if such entity shall cease to rate the General
Term Notes or shall cease to exist and there shall be no such successor
thereto, any other nationally recognized statistical rating organization
selected by the Company which is acceptable to the Trustee.
"Enterprises" means CMS Enterprises Company, a Michigan
corporation.
"Event of Default" with respect to the General Term Notes
has the meaning specified in Article VI of this Third Supplemental
Indenture.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchangeable Stock" means any Capital Stock of a
corporation that is exchangeable or convertible into another security
(other than Capital Stock of such corporation that is neither Exchangeable
Stock, or Redeemable Stock).
"Indebtedness" of any Person means, without duplication,
(i) the principal of and premium (if any) in respect of (A)
indebtedness of such Person for money borrowed and (B) indebtedness
evidenced by notes, debentures, bonds or other similar instruments
for the payment of which such Person is responsible or liable;
(ii) all Capital Lease Obligations of such Person;
(iii) all obligations of such Person issued or assumed as
the deferred purchase price of property, all conditional sale
obligations and all obligations under any title retention agreement
(but excluding trade accounts payable arising in the ordinary
course of business);
(iv) all obligations of such Person for the reimbursement
of any obligor on any letter of credit, bankers' acceptance or
similar credit transaction (other than obligations with respect to
letters of credit securing obligations (other than obligations
described in clauses (i) through (iii) above) entered into in the
ordinary course of business of such Person to the extent such
letters of credit are not drawn upon or, if and to the extent drawn
upon, such drawing is reimbursed no later than the third Business
Day following receipt by such Person of a demand for reimbursement
following payment on the letter of credit);
(v) all obligations of the type referred to in clauses (i)
through (iv) of other Persons and all dividends of other Persons
for the payment of which, in either case, such Person is
responsible or liable as obligor, guarantor or otherwise; and
(vi) all obligations of the type referred to in clauses (i)
through (v) of other Persons secured by any Lien on any property or
asset of such Person (whether or not such obligation is assumed by
such Person), the amount of such obligation being deemed to be the
lesser of the value of such property or assets or the amount of the
obligation so secured.
"Interest Rate Protection Agreement" means any interest rate
swap agreement, interest rate cap agreement or other financial agreement
or arrangement designed to protect the Company or any Subsidiary against
fluctuations in interest rates.
"Letter Stock", as applied to the Capital Stock of any
corporation, means Capital Stock of any class or classes (however
designated) which is intended to reflect the separate performance of
certain of the businesses or operations conducted by such corporation or
any of its subsidiaries.
"Lien" means any lien, mortgage, pledge, security interest,
conditional sale, title retention agreement or other charge or encumbrance
of any kind.
"Net Proceeds" means, with respect to any issuance or sale
or contribution in respect of Capital Stock, the aggregate proceeds of
such issuance, sale or contribution, including the fair market value (as
determined by the Board of Directors and net of any associated debt and of
any consideration other than Capital Stock received in return) of property
other than cash, received by the Company, net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees, discounts, or
commissions and brokerage, consultant and other fees actually incurred in
connection with such issuance or sale and net of taxes paid or payable as
a result thereof, provided, however, that if such fair market value as
determined by the Board of Directors of property other than cash is
greater than $25 million, the value thereof shall be based upon an opinion
from an independent nationally recognized firm experienced in the
appraisal or similar review of similar types of transactions.
"NOMECO" means, CMS NOMECO Oil & Gas Co., a Michigan
corporation and wholly-owned subsidiary of the Company.
"Non-Convertible Capital Stock" means, with respect to any
corporation, any non-convertible Capital Stock of such corporation and any
Capital Stock of such corporation convertible solely into non-convertible
Capital Stock other than Preferred Stock of such corporation; provided,
however, that Non-Convertible Capital Stock shall not include any
Redeemable Stock or Exchangeable Stock.
"Operating Cash Flow" means, for any period, with respect to
the Company and its Consolidated Subsidiaries, the aggregate amount of
Consolidated Net Income after adding thereto Consolidated Interest Expense
(adjusted to include costs recognized on early retirement of debt), income
taxes, depreciation expense, Amortization Expense and any noncash
amortization of debt issuance costs, any nonrecurring, noncash charges to
earnings and any negative accretion recognition.
"Preferred Stock", as applied to the Capital Stock of any
corporation, means Capital Stock of any class or classes (however
designated) that is preferred as to the payment of dividends, or as to the
distribution of assets upon any voluntary or involuntary liquidation or
dissolution of such corporation, over shares of Capital Stock of any other
class of such corporation.
"Redeemable Stock" means any Capital Stock that by its terms
or otherwise is required to be redeemed prior to the first anniversary of
the Maturity of any Outstanding General Term Notes or is redeemable at the
option of the holder thereof at any time prior to the first anniversary of
the Maturity of any Outstanding General Term Notes.
"Restricted Subsidiary" means any Subsidiary (other than
Consumers and its subsidiaries) of the Company which, as of the date of
the Company's most recent quarterly consolidated balance sheet,
constituted at least 10% of the total Consolidated Assets of the Company
and its Consolidated Subsidiaries and any other Subsidiary which from time
to time is designated a Restricted Subsidiary by the Board of Directors
provided that no Subsidiary may be designated a Restricted Subsidiary if,
immediately after giving effect thereto, an Event of Default or event
that, with the lapse of time or giving of notice or both, would constitute
an Event of Default would exist or the Company and its Restricted
Subsidiaries could not incur at least $1 of additional Indebtedness under
Section 510, and (i) any such Subsidiary so designated as a Restricted
Subsidiary must be organized under the laws of the United States or any
State thereof, (ii) more than 80% of the Voting Stock of such Subsidiary
must be owned of record and beneficially by the Company or a Restricted
Subsidiary, (iii) such Restricted Subsidiary must be a Consolidated
Subsidiary, and (iv) such Subsidiary must not theretofore have been
designated as a Restricted Subsidiary.
"Standard & Poor's" shall mean Standard & Poor's Corporation,
and any successor thereto which is a nationally recognized statistical
rating organization, or if such entity shall cease to rate the General
Term Notes or shall cease to exist and there shall be no such successor
thereto, any other nationally recognized statistical rating organization
selected by the Company which is acceptable to the Trustee.
"Support Obligations" means, for any person, without
duplication, any financial obligation, contingent or otherwise, of such
person guaranteeing or otherwise supporting any debt or other obligation
of any other person in any manner, whether directly or indirectly, and
including, without limitation, any obligation of such person, direct or
indirect, (i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such debt or to purchase (or to advance or supply
funds for the purchase of) any security for the payment of such debt,
(ii) to purchase property, securities or services for the purpose of
assuring the owner of such debt of the payment of such debt, (iii) to
maintain working capital, equity capital, available cash or other
financial statement condition of the primary obligor so as to enable the
primary obligor to pay such debt, (iv) to provide equity capital under or
in respect of equity subscription arrangements (to the extent that such
obligation to provide equity capital does not otherwise constitute debt),
or (v) to perform, or arrange for the performance of, any non-monetary
obligations or non-funded debt payment obligations of the primary obligor.
"Tax-Sharing Agreement" means the Amended and Restated
Agreement for the Allocation of Income Tax Liabilities and Benefits, dated
January 1, 1994, as amended or supplemented from time to time, by and
among Company, each of the members of the Consolidated Group (as defined
therein), and each of the corporations that become members of the
Consolidated Group.
Certain terms, used principally in Articles Three, Four and
Seven of this Third Supplemental Indenture, are defined in those Articles.
ARTICLE II
DESIGNATION AND TERMS OF THE GENERAL TERM NOTES; FORMS
SECTION 201. Establishment of Series. There is hereby
created a series of Securities to be known and designated as the "General
Term Notes(R), Series C" and limited in aggregate principal amount (except
as contemplated in Section 301(2) of the Indenture) to $150,000,000.
Each General Term Note will be dated and issued as of the
date of its authentication by the Trustee. Each General Term Note shall
also bear an Original Issue Date (as hereinafter defined) which, with
respect to any General Term Note (or any portion thereof), shall mean the
date of its original issue, as specified in such General Term Note (the
"Original Issue Date"), and such Original Issue Date shall remain the same
if such General Term Note is subsequently issued upon transfer, exchange,
or substitution of such General Term Note regardless of its date of
authentication. Principal on any General Term Note shall become due and
payable from nine months to twenty-five years from the Original Issue Date
of such General Term Note, as specified on such General Term Note.
Each General Term Note will bear interest from the Original
Issue Date, or from the most recent date to which interest has been paid
or duly provided for, at the rate per annum stated therein until the
principal thereof is paid or made available for payment. Interest will be
payable either monthly, quarterly or semi-annually on each Interest
Payment Date and at Maturity, as specified below and in each General Term
Note. Interest will be payable to the person in whose name a General Term
Note is registered at the close of business on the Regular Record Date
next preceding each Interest Payment Date; provided, however, interest
payable at Maturity will be payable to the person to whom principal shall
be payable. Interest on the General Term Notes will be computed on the
basis of a 360-day year of twelve 30-day months.
The Interest Payment Dates for a General Term Note that
provides for monthly interest payments shall be the fifteenth day of each
calendar month; provided, however, that in the case of a General Term Note
issued between the first and fifteenth day of a calendar month, interest
otherwise payable on the fifteenth day of such calendar month will be
payable on the fifteenth day of the next succeeding calendar month. In
the case of a General Term Note that provides for quarterly interest
payments, the Interest Payment Dates shall be the fifteenth day of each of
the months specified in such General Term Note, commencing on the day that
is three months from (i) the day on which such General Term Note is
issued, if such General Term Note is issued on the fifteenth day of a
calendar month, or (ii) the fifteenth day of the calendar month
immediately preceding the calendar month in which such General Term Note
is issued, if such General Term Note is issued prior to the fifteenth day
of a calendar month, or (iii) the fifteenth day of the calendar month in
which such General Term Note is issued, if such General Term Note is
issued after the fifteenth day of a calendar month. In the case of a
General Term Note that provides for semi-annual interest payments, the
Interest Payment Dates shall be the fifteenth day of each of the months
specified in such General Term Note, commencing on the day that is six
months from (i) the day on which such General Term Note is issued, if such
General Term Note is issued on the fifteenth day of a calendar month, or
(ii) the fifteenth day of the calendar month immediately preceding the
calendar month in which such General Term Note is issued, if such General
Term Note is issued prior to the fifteenth day of a calendar month, or
(iii) the fifteenth day of the calendar month in which such General Term
Note is issued, if such General Term Note is issued after the fifteenth
day of a calendar month.
Payment of principal of the General Term Notes (and premium,
if any) and, unless otherwise paid as hereinafter provided, any interest
thereon will be made at the office or agency of the Company in New York,
New York; provided, however, that payment of interest (other than interest
at Maturity) may be made at the option of the Company by check or draft
mailed to the Person entitled thereto at such Person's address appearing
in the Security Register or by wire transfer to an account designated by
such Person not later than ten days prior to the date of such payment.
The Regular Record Date referred to in Section 301 of the
Indenture for the payment of the interest on any General Term Note payable
on any Interest Payment Date (other than at Maturity) shall be the first
day (whether or not a Business Day) of the calendar month in which such
Interest Payment Date occurs as is specified in such General Term Note,
and, in the case of interest payable at Maturity, the Regular Record Date
shall be the date of Maturity. Unless otherwise specified in such General
Term Notes, the cities of New York, New York and Chicago, Illinois shall
be the reference cities for determining a Business Day.
The General Term Notes may be issued only as registered
notes, without coupons, in denominations of $1,000 and any larger
denomination which is in an integral multiple of $1,000.
Upon the execution of this Third Supplemental Indenture, or
from time to time thereafter, General Term Notes may be executed by the
Company and delivered to the Trustee for authentication, and the Trustee
shall thereupon authenticate and deliver said General Term Notes in
accordance with the procedures set forth in or upon a Company Order
complying with Sections 301 and 303 of the Indenture.
SECTION 202. Forms Generally. The General Term Notes shall
be in substantially the form set forth in this Article, with such
appropriate insertions, omissions, substitutions and other variations as
are required or permitted by the Indenture, and may have such letters,
numbers or other marks of identification and such legends or endorsements
placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such General Term Notes, as evidenced by their
execution thereof.
The definitive General Term Notes shall be printed,
lithographed or engraved on steel engraved borders or may be produced in
any other manner, all as determined by the officers executing such General
Term Notes, as evidenced by their execution thereof.
SECTION 203. Form of Face of General Term Note.
[Insert any legend required by the Internal Revenue
Code and the regulations thereunder.]
CMS ENERGY CORPORATION
GENERAL TERM NOTE(R), SERIES C
No. ________ $__________
[Initial Redemption Date]
CMS Energy Corporation, a corporation duly organized and
existing under the laws of the State of Michigan (herein called the
"Company", which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
_________________________________, or registered assigns, the principal
sum of ____________________ Dollars on __________________________ and to
pay interest thereon from _____________ (the "Original Issue Date") or
from the most recent Interest Payment Date to which interest has been paid
or duly provided for, [choose one of the following --
monthly/quarterly/semi-annually [insert as applicable -- on ___________
[________, ____________] and _________ in each [year/month], commencing
______________, and at Maturity at the rate of ____% per annum, until the
principal hereof is paid or made available for payment [if applicable,
insert --, and at the rate of ___% per annum on any overdue principal and
premium and on any overdue installment of interest]. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment
Date will, as provided in such Indenture, be paid to the Person in whose
name this General Term Note (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the first day of the calendar month in which such
Interest Payment Date occurs (whether or not a Business Day) next
preceding such Interest Payment Date except that the Regular Record Date
for interest payable at Maturity shall be the date of Maturity. Any such
interest not so punctually paid or duly provided for will forthwith cease
to be payable to the Holder on such Regular Record Date and may either be
paid to the Person in whose name this General Term Note (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 General Term
Notes 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 General Term Notes
may be listed, and upon such notice as may be required by such exchange,
all as more fully provided in said Indenture.
[If the General Term Note is not to bear interest prior to
Maturity, insert -- The principal of this General Term Note shall not bear
interest except in the case of a default in payment of principal upon
acceleration, upon redemption or at Stated Maturity and in such case the
overdue principal of this General Term Note shall bear interest at the
rate of ___% per annum, which shall accrue from the date of such default
in payment to the date payment of such principal has been made or duly
provided for. Interest on any overdue principal shall be payable on
demand. Any such interest on any overdue principal that is not so paid on
demand shall bear interest at the rate of ____% per annum, which shall
accrue from the date of such demand for payment to the date payment of
such interest has been made or duly provided for, and such interest shall
also be payable on demand.]
Payment of the principal of (and premium, if any) and
interest, if any, on this General Term Note will be made at the office or
agency of the Company maintained for that purpose in New York, New York
(the "Place of Payment"), 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 (other than interest payable at Maturity) may be made
by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register or by wire transfer to an
account designated by such Person not later than ten days prior to the
date of such payment.
Reference is hereby made to the further provisions of this
General Term Note set forth on the reverse hereof, which further
provisions shall for all purposes have the same effect as if set forth at
this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual
signature, this General Term Note shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument
to be duly executed under its corporate seal.
Dated:
CMS ENERGY CORPORATION
By _______________________
Attest:
_________________________
SECTION 204. Form of Reverse of General Term Note.
This General Term Note(R), Series C is one of a duly
authorized issue of securities of the Company (herein called the "General
Term Notes"), issued and to be issued in one or more series under an
Indenture, dated as of January 15, 1994, as supplemented by certain
supplemental indentures, including the Third Supplemental Indenture, dated
as of March __, 1997 (herein collectively referred to as the "Indenture"),
between the Company and The Chase Manhattan Bank, a New York banking
corporation, 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 Company, the Trustee, the Holders of the General Term
Notes and of the terms upon which the General Term Notes are, and are to
be, authenticated and delivered. This General Term Note is one of the
series designated on the face hereof, limited in aggregate principal
amount to $150,000,000.
[If applicable, insert -- The General Term Notes of this
series are subject to redemption upon not more than 60 nor less than 30
days' notice as provided in the Indenture, at any time [on or after
__________, _____,] as a whole or in part from time to time, at the
election of the Company, at the following Redemption Prices (expressed as
percentages of the principal amount): If redeemed [on or before
_____________, ___%, and if redeemed] during the 12-month period beginning
____________ of the years indicated,
Redemption Redemption
Year Price Year Price
____ __________ ____ __________
and thereafter at a Redemption Price equal to ___% of the principal
amount, together in the case of any such redemption with accrued interest
to the Redemption Date, but interest installments whose Stated Maturity is
on or prior to such Redemption Date will be payable to the Holders of such
General Term Notes, or one or more Predecessor Securities, of record at
the close of business on the relevant Record Dates referred to on the face
hereof, all as provided in the Indenture.]
[Notwithstanding the foregoing, the Company may not, prior
to __________, redeem this General Term Note as a part of, or in
anticipation of, any refunding operation by the application, directly or
indirectly, of moneys borrowed having an effective interest cost to the
Company (calculated in accordance with generally accepted financial
practice) of less than the effective interest cost to the Company
(similarly calculated) of this General Term Note.]
[If the General Term Note is subject to redemption,
insert -- In the event of redemption of this General Term Note in part
only, a new General Term Note or Notes of this series and of like tenor
for the unredeemed portion hereof will be issued in the name of the Holder
hereof upon the cancellation hereof.]
If a Change in Control occurs, the Company shall notify the
Holder of this General Term Note of such occurrence and such Holder shall
have the right to require the Company to make a Required Repurchase of all
or any part of this General Term Note at a Change in Control Purchase
Price equal to 101% of the principal amount of this General Term Note to
be so purchased as more fully provided in the Indenture and subject to the
terms and conditions set forth therein. In the event of a Required
Repurchase of only a portion of this General Term Note, a new General Term
Note or Notes for the unrepurchased portion hereof will be issued in the
name of the Holder hereof upon the cancellation hereof.
[If this General Term Note is subject to redemption upon
exercising a Survivor's Option, insert -- As more fully provided in the
Indenture and subject to the terms and conditions set forth therein, the
Company will repay this General Term Note (or portion thereof) properly
tendered for repayment by or on behalf of the person (the
"Representative") that has authority to act on behalf of a deceased owner
of the beneficial interest in this General Term Note under the laws of the
appropriate jurisdiction (including, without limitation, the personal
representative, executor, surviving joint tenant or surviving tenant by
the entirety of such deceased beneficial owner) at a price equal to 100%
of the principal amount hereof plus accrued interest to the date of such
repayment. The Company may, in its sole discretion, limit the aggregate
principal amount of all outstanding General Term Notes as to which
exercises of this option (the "Survivor's Option") will be accepted in any
calendar year to one percent (1%) of the outstanding principal amount of
all General Term Notes as of the end of the most recent fiscal year, but
not less than $500,000 in any such calendar year, or such greater amount
as the Company in its sole discretion may determine for any calendar year,
and may limit to $100,000, or such greater amount as the Company in its
sole discretion may determine for any calendar year, the aggregate
principal amount of General Term Notes (or portions thereof) as to which
exercise of the Survivor's Option will be accepted in such calendar year
with respect to any individual deceased owner of beneficial interests in
such General Term Notes.
[If the General Term Note is not an Original Issue Discount
Security, insert -- If an Event of Default with respect to this General
Term Note shall occur and be continuing, the principal of this General
Term Note may be declared due and payable in the manner and with the
effect provided in the Indenture.]
In any case where any Interest Payment Date, Redemption
Date, Repayment Date, Stated Maturity or Maturity of any General Term Note
shall not be a Business Day at any Place of Payment, then (notwithstanding
any other provision of the Indenture or this General Term Note), payment
of interest or principal (and premium, if any) need not be made at such
Place of Payment on such date, but may be made on the next succeeding
Business Day at such Place of Payment with the same force and effect as if
made on the Interest Payment Date, Redemption Date or Repayment Date or at
the Stated Maturity or Maturity; provided that no interest shall accrue on
the amount so payable for the period from and after such Interest Payment
Date, Redemption Date, Repayment Date, Stated Maturity or Maturity, as the
case may be, to such Business Day.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of all
Outstanding Securities under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of not less than a majority in
principal amount of all Outstanding Securities affected. The Indenture
also contains provisions permitting the Holders of specified percentages
in principal amount of all Outstanding Securities, on behalf of the
Holders of all Outstanding Securities, to waive compliance by the Company
with certain provisions of the Indenture. Any such consent or waiver by
the Holder of this General Term Note shall be conclusive and binding upon
such Holder and upon all future Holders of this General Term Note and of
any General Term Note 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 General Term Note.
The Indenture permits the Holders of not less than a
majority in principal amount of all Outstanding Securities of any series
thereunder to waive on behalf of the Holders of all Outstanding Securities
of such series any past default by the Company, provided that no such
waiver may be made with respect to a default in the payment of the
principal of or premium, if any, or the interest on any Security of such
series or the default by the Company in respect of certain covenants or
provisions of the Indenture, the modification or amendment of which must
be consented to by the Holder of each Outstanding Security of each series
affected.
As set forth in, and subject to, the provisions of the
Indenture, no Holder of any General Term Note will have any right to
institute any proceeding with respect to the Indenture or for any remedy
thereunder, unless such Holder shall have previously given to the Trustee
written notice of a continuing Event of Default, the Holders of not less
than 25% in principal amount of the Outstanding General Term Notes shall
have made written request, and offered satisfactory indemnity, to the
Trustee to institute such proceeding as trustee, and the Trustee shall not
have received from the Holders of a majority in principal amount of the
Outstanding General Term Notes a direction inconsistent with such request
and shall have failed to institute such proceeding within 60 days;
provided, however, that such limitations do not apply to a suit instituted
by the Holder hereof for the enforcement of payment of the principal of
(and premium, if any) or any interest on this General Term Note on or
after the respective due dates expressed herein.
No reference herein to the Indenture and no provision of
this General Term Note or of the Indenture shall alter or impair the
obligation of the Company, which is absolute and unconditional, to pay the
principal of and any premium and interest on this General Term Note at the
times, place and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this General Term Note is
registerable in the Security Register, upon surrender of this General Term
Note for registration of transfer at the office or agency of the Company
in any place where the principal of and any premium and interest on this
General Term Note are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney
duly authorized in writing, and thereupon one or more new General Term
Notes of this series and of like tenor, of authorized denominations and
for the same aggregate principal amount, will be issued to the designated
transferee or transferees.
The General Term Notes of this series are issuable only in
registered form without coupons in denominations of $1,000 and any
integral multiple thereof. As provided in the Indenture and subject to
certain limitations therein set forth, General Term Notes of this series
are exchangeable for a like aggregate principal amount of General Term
Notes of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in
connection therewith.
[If this General Term Note is redeemable at the option of
the Company, insert -- The Company shall not be required (i) to issue,
register the transfer of or exchange this General Term Note if this
General Term Note may be among those selected for redemption during a
period beginning at the opening of business 15 days before selection of
the General Term Notes to be redeemed under Section 1103 of the Indenture
and ending at the close of business on the day of the mailing of the
relevant notice of redemption, (ii) to register the transfer of or
exchange any General Term Note so selected for redemption in whole or in
part, except, in the case of any General Term Note to be redeemed in part,
the portion thereof not to be redeemed, or (iii) to issue, register the
transfer of or exchange any General Term Note which has been surrendered
for repayment at the option of the Holder, except the portion, if any, of
such General Term Note not to be so repaid.]
Prior to due presentment of this General Term Note for
registration of transfer, the Company, the Trustee and any agent of the
Company or the Trustee may treat the Person in whose name this General
Term Note is registered as the owner hereof for all purposes, whether or
not this General Term Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
<PAGE>
<PAGE>
All terms used in this General Term Note without definition
which are defined in the Indenture shall have the meanings assigned to
them in the Indenture.
______________________________
(R) Registered servicemark of J. W. Korth & Company
SECTION 205. Form of Legend for Global Notes. Any Global
Note (as defined in Article VII below) authenticated and delivered
hereunder shall bear a legend in substantially the following form:
"This Security is a Global Note within the meaning of the
Indenture hereinafter referred to and is registered in the name of
a Depositary or a nominee of a Depositary. This General Term Note
is not exchangeable for General Term Notes registered in the name
of a Person other than the Depositary or its nominee except in the
limited circumstances described in the Indenture, and no transfer
of this General Term Note (other than a transfer of this General
Term Note 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) may be registered except in the
limited circumstances described in the Indenture."
SECTION 206. Form of Trustee's Certificate of
Authentication. The Trustee's certificates of authentication shall be in
substantially the following form:
This is one of the General Term Notes of the series
designated therein referred to in the within-mentioned Indenture.
____________________________,
as Trustee
By __________________________
Authorized Officer
ARTICLE III
REDEMPTION OF GENERAL TERM NOTES; CHANGE OF CONTROL
SECTION 301. Redemption of General Term Notes. (a) Each
General Term Note may be redeemed by the Company in whole or in part if so
provided in, and in accordance with, the terms of such General Term Note
issued by the Company. The Company may redeem any General Term Note which
by its terms is redeemable prior to Stated Maturity without also redeeming
any other General Term Note which is redeemable prior to Stated Maturity.
(b) Change of Control. Upon the occurrence of a Change in
Control (the effective date of such Change in Control being the "Change in
Control Date"), each Holder of a General Term Note shall have the right to
require that the Company repurchase (a "Required Repurchase") all or any
part of such Holder's General Term Note at a repurchase price payable in
cash equal to 101% of the principal amount of such General Term Note plus
accrued interest to the Purchase Date (the "Change in Control Purchase
Price").
(1) Within 30 days following the Change in Control Date,
the Company shall mail a notice (the "Required Repurchase Notice")
to each Holder with a copy to the Trustee stating:
(i) that a Change in Control has occurred and that
such Holder has the right to require the Company to
repurchase all or any part of such Holder's General Term
Notes at the Change of Control Purchase Price;
(ii) the Change of Control Purchase Price;
(iii) the date on which any Required Repurchase
shall be made (which shall be no earlier than 60 days nor
later than 90 days from the date such notice is mailed) (the
"Purchase Date");
(iv) the name and address of the Paying Agent; and
(v) the procedures that Holders must follow to cause
the General Term Notes to be repurchased, which shall be
consistent with this Section and the Indenture.
(2) Holders electing to have a General Term Note
repurchased must deliver a written notice (the "Change in Control
Purchase Notice") to the Paying Agent (initially the Trustee) at
its office in The City of New York, or any other office of the
Paying Agent maintained for such purposes, not later than 30 days
prior to the Purchase Date. The Change in Control Purchase Notice
shall state: (i) the portion of the principal amount of any General
Term Notes to be repurchased, which portion must be $1,000 or an
integral multiple thereof; (ii) that such General Term Notes are to
be repurchased by the Company pursuant to the change in control
provisions of the Indenture; and (iii) unless the General Term
Notes are represented by one or more Global Notes, the certificate
numbers of the General Term Notes to be delivered by the Holder
thereof for repurchase by the Company. Any Change in Control
Purchase Notice may be withdrawn by the Holder by a written notice
of withdrawal delivered to the Paying Agent not later than three
Business Days prior to the Purchase Date. The notice of withdrawal
shall state the principal amount and, if applicable, the
certificate numbers of the General Term Notes as to which the
withdrawal notice relates and the principal amount of such General
Term Notes, if any, which remains subject to a Change in Control
Purchase Notice.
If a General Term Note is represented by a Global Note (as
described in Article VII below), the Depositary or its nominee will
be the Holder of such General Term Note and therefore will be the
only entity that can elect a Required Repurchase of such General
Term Note. To obtain repayment pursuant to this Section 301(b)
with respect to such General Term Note, the beneficial owner of
such General Term Note must provide to the broker or other entity
through which it holds the beneficial interest in such General Term
Note (i) the Change in Control Purchase Notice signed by such
beneficial owner, and such signature must be guaranteed by a member
firm of a registered national securities exchange or of the
National Association of Securities Dealers, Inc. or a commercial
bank or trust company having an office or correspondent in the
United States, and (ii) instructions to such broker or other entity
to notify the Depositary of such beneficial owner's desire to
obtain repayment pursuant to this Section 301(b). Such broker or
other entity will provide to the Paying Agent (i) the Change of
Control Purchase Notice received from such beneficial owner and
(ii) a certificate satisfactory to the Paying Agent from such
broker or other entity stating that it represents such beneficial
owner. Such broker or other entity will be responsible for
disbursing any payments it receives pursuant to this Section 301(b)
to such beneficial owner.
(3) Payment of the Change of Control Purchase Price for a
General Term Note for which a Change in Control Purchase Notice has
been delivered and not withdrawn is conditioned (except in the case
of a General Term Note represented by one or more Global Notes)
upon delivery of such General Term Note (together with necessary
endorsements) to the Paying Agent at its office in The City of New
York, or any other office of the Paying Agent maintained for such
purpose, at any time (whether prior to, on or after the Purchase
Date) after the delivery of such Change in Control Purchase Notice.
Payment of the Change of Control Purchase Price for such General
Term Note will be made promptly following the later of the Purchase
Date or the time of delivery of such General Term Note. If the
Paying Agent holds, in accordance with the terms of the Indenture,
money sufficient to pay the Change in Control Purchase Price of
such General Term Note on the Business Day following the Purchase
Date, then, on and after such date, interest will cease accruing,
and, if applicable, amounts will no longer accrue on any such
General Term Note that is an Original Issue Discount Security,
whether or not such General Term Note is delivered to the Paying
Agent, and all other rights of the Holder shall terminate (other
than the right to receive the Change of Control Purchase Price upon
delivery of the General Term Note).
(4) The Company shall comply with the provisions of Rule
13e-4 and any other tender offer rules under the Exchange Act,
which may then be applicable and shall file Schedule 13E-4 or any
other schedule required thereunder in connection with any offer by
the Company to repurchase General Term Notes at the option of
Holders upon a Change in Control.
(5) No General Term Note may be repurchased by the
Company as a result of a Change in Control if there has occurred
and is continuing an Event of Default (other than a default in the
Payment of the Change in Control Purchase Price with respect to the
General Term Notes).
ARTICLE IV
REPAYMENT UPON DEATH
If so specified in any General Term Note, the Holder of such
General Term Note will have the option (the "Survivor's Option") to elect
repayment of such General Term Note prior to its Stated Maturity in the
event of the death of the beneficial owner of such General Term Note.
Pursuant to exercise of the Survivor's Option, if
applicable, the Company will repay any General Term Note (or portion
thereof) properly tendered for repayment by or on behalf of the person
(the "Representative") that has authority to act on behalf of the deceased
beneficial owner of such General Term Note under the laws of the
appropriate jurisdiction (including, without limitation, the personal
representative, executor, surviving joint tenant or surviving tenant by
the entirety of such deceased beneficial owner) at a price equal to
one-hundred percent (100%) of the principal amount of the beneficial
interest of the deceased owner of such General Term Note plus accrued
interest to the date of such payment, subject to the following
limitations. The Company may, in its sole discretion, limit the aggregate
principal amount of General Term Notes as to which exercises of the
Survivor's Option will be accepted in any calendar year (the "Annual Put
Limitation") to one percent (1%) of the outstanding principal amount of
the General Term Notes as of the end of the most recent fiscal year, but
not less than $500,000 in any such calendar year, or such greater amount
as the Company in its sole discretion may determine for any calendar year,
and may limit to $100,000, or such greater amount as the Company in its
sole discretion may determine for any calendar year, the aggregate
principal amount of General Term Notes (or portions thereof) as to which
exercise of the Survivor's Option will be accepted in such calendar year
with respect to any individual deceased owner of beneficial interests in
such General Term Notes (the "Individual Put Limitation"). Moreover, the
Company will not make principal repayments pursuant to exercise of the
Survivor's Option in amounts that are less that $1,000, and, in the event
that the limitations described in the preceding sentence would result in
the partial repayment of any General Term Note, the principal amount of
such General Term Note remaining outstanding after repayment must be at
least $1,000 (the minimum authorized denomination of the General Term
Notes). Any General Term Note (or portion thereof) tendered pursuant to
exercise of the Survivor's Option may be withdrawn by a written request of
its Holder received by the Trustee prior to its repayment.
Each General Term Note (or portion thereof) that is tendered
pursuant to a valid exercise of the Survivor's Option will be accepted
promptly in the order all such General Term Notes are tendered, except for
any General Term Note (or portion thereof) the acceptance of which would
contravene (i) the Annual Put Limitation, if applied, or (ii) the
Individual Put Limitation, if applied, with respect to the relevant
individual deceased owner of beneficial interests therein. If, as of the
end of any calendar year, the aggregate principal amount of General Term
Notes (or portions thereof) that have been accepted pursuant to exercise
of the Survivor's Option for such year has not exceeded the Annual Put
Limitation, if applied, for such year, any exercise(s) of the Survivor's
Option with respect to General Term Notes (or portions thereof) not
accepted during such calendar year because such acceptance would have
contravened the Individual Put Limitation, if applied, with respect to an
individual deceased owner of beneficial interests therein will be accepted
in the order all such General Term Notes (or portions thereof) were
tendered, to the extent that any such exercise would not exceed the Annual
Put Limitation, if applied, for such calendar year. Any General Term Note
(or portion thereof) accepted for repayment pursuant to exercise of the
Survivor's Option will be repaid no later than the first Interest Payment
Date that occurs 20 or more calendar days after the date of such
acceptance. Each General Term Note (or any portion thereof) tendered for
repayment that is not accepted in any calendar year because of the
application of the Annual Put Limitation will be deemed to be tendered in
the following calendar year in the order in which all such General Term
Notes (or portions thereof) were originally tendered, unless any such
General Term Note (or portion thereof) is withdrawn by the Representative
for the deceased owner prior to its repayment. In the event that a
General Term Note (or any portion thereof) tendered for repayment pursuant
to valid exercise of the Survivor's Option is not accepted, the Trustee
will deliver a notice by first-class mail to the registered Holder thereof
at its last known address as indicated in the Security Register that
states the reasons such General Term Note (or portion thereof) has not
been accepted for repayment.
Subject to the foregoing, in order for a Survivor's Option
to be validly exercised with respect to any General Term Note (or portion
thereof), the Trustee must receive from the Representative of the
individual deceased owner of beneficial interests therein (i) a written
request for payment signed by the Representative, and such signature must
be guaranteed by a member firm of a registered national securities
exchange or of the National Association of Securities Dealers, Inc. or a
commercial bank or trust company having an office or correspondent in the
United States, (ii) if any such General Term Note is not represented by a
Global Note (as described in Article VII below), tender of the General
Term Note (or portion thereof) to be repaid, (iii) appropriate evidence
satisfactory to the Company and the Trustee that (A) the Representative
has authority to act on behalf of the individual deceased beneficial
owner, (B) the death of such beneficial owner has occurred and (C) the
deceased individual was the owner of a beneficial interest in such General
Term Note at the time of death, (iv) if applicable, a properly executed
assignment or endorsement, and (v) if the beneficial interest in such
General Term Note is held by a nominee of the deceased beneficial owner, a
certificate satisfactory to the Trustee from such nominee attesting to the
deceased's ownership of a beneficial interest in such General Term Note.
All questions as to the eligibility or validity of any exercise of the
Survivor's Option will be determined by the Company, in its sole
discretion, which determinations will be final and binding on all parties.
If a General Term Note is represented by a Global Note (as
described in Article VII below), the Depositary or its nominee will be the
Holder of such General Term Note and therefore will be the only entity
that can exercise the Survivor's Option for such General Term Note. To
obtain repayment pursuant to exercise of the Survivor's Option with
respect to such General Term Note, the Representative must provide to the
broker or other entity through which the beneficial interest in such
General Term Note is held by the deceased owner (i) the documents
described in clauses (i) and (iii) of the preceding paragraph and (ii)
instructions to such broker or other entity to notify the Depositary of
such Representative's desire to obtain repayment pursuant to exercise of
the Survivor's Option. Such broker or other entity shall provide to the
Trustee (i) the documents received from the Representative referred to in
clause (i) of the preceding sentence and (ii) a certificate satisfactory
to the Trustee from such broker or other entity stating that it represents
the deceased beneficial owner. Such broker or other entity will be
responsible for disbursing any payments it receives pursuant to exercise
of the Survivor's Option to the appropriate Representative.
ARTICLE V
ADDITIONAL COVENANTS OF THE COMPANY
WITH RESPECT TO THE GENERAL TERM NOTES
SECTION 501. Statement by Officers as to Default. (a) The
Company will deliver to the Trustee, within 120 days after the end of each
fiscal year a brief certificate from the principal executive officer,
principal financial officer or principal accounting officer as to his or
her knowledge of the Company's compliance with all conditions and
covenants under this Third Supplemental Indenture. For such purposes,
such compliance shall be determined without regard to any period of grace
or requirement of notice provided hereunder and, if the Company shall be
in default, specifying all such defaults and the nature and status thereof
of which they may have knowledge.
(b) The Company shall deliver to the Trustee, as soon as
possible and in any event within 10 days after the Company becomes aware
of the occurrence of an Event of Default or an event which, with notice or
the lapse of time or both, would constitute an Event of Default, an
Officers' Certificate setting forth the details of such Event of Default
or default, and the action which the Company proposes to take with respect
thereto.
SECTION 502. Existence. So long as any of the General Term
Notes are Outstanding, subject to Article 8 of the Indenture, the Company
will do or cause to be done all things necessary to preserve and keep in
full force and effect its corporate existence and all rights (charter and
statutory) and franchises other than rights or franchises the loss of
which would not be disadvantageous in any material respect to the Holders
of the General Term Notes.
SECTION 503. Maintenance of Properties. So long as any of
the General Term Notes are Outstanding, the Company will cause all
properties used or useful in the conduct of its business to be maintained
and kept in good condition, repair and working order and supplied with all
necessary equipment and will cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in
the judgment of the Company may be necessary so that the business carried
on in connection therewith may be properly and advantageously conducted at
all times; provided, however, that nothing in this Section shall prevent
the Company from discontinuing the operation or maintenance of any of such
properties if such discontinuance is, in the judgment of the Company,
desirable in the conduct of its business and not disadvantageous in any
material respect to the Holders.
SECTION 504. Payment of Taxes and Other Claims. So long as
any of the General Term Notes are Outstanding, the Company will pay or
discharge or cause to be paid or discharged, before the same shall become
delinquent, (1) all taxes, assessments and governmental charges levied or
imposed upon the Company or any Subsidiary or upon the income, profits or
property of the Company or any Subsidiary, and (2) all lawful claims for
labor, materials and supplies which, if unpaid, might by law become a Lien
upon the property of the Company or any Subsidiary; provided, however,
that the Company shall not be required to pay or discharge or cause to be
paid or discharged any such tax, assessment, charge or claim the amount of
which, applicability or validity is being contested in good faith by
appropriate proceedings.
SECTION 505. Insurance. So long as any of the General Term
Notes are Outstanding, the Company shall, and each of its Restricted
Subsidiaries and Consumers shall, keep insured by financially sound and
reputable insurers all property of a character usually insured by entities
engaged in the same or similar businesses similarly situated against loss
or damage of the kinds and in the amounts customarily insured against by
such entities and carry such amounts of other insurance as is usually
carried by such entities.
SECTION 506. Compliance with Laws. So long as any of the
General Term Notes are Outstanding, the Company shall, and each of its
Restricted Subsidiaries and Consumers shall, comply in all material
respects with all laws applicable to the Company or such Restricted
Subsidiary or Consumers, as the case may be, its respective business and
properties.
SECTION 508. Limitation on Certain Liens. (a) So long as
any of the General Term Notes are outstanding, the Company shall not
create, incur, assume or suffer to exist any lien, mortgage, pledge,
security interest, conditional sale, title retention agreement or other
charge or encumbrance of any kind, or any other type of arrangement
intended or having the effect of conferring upon a creditor of the Company
or any Subsidiary a preferential interest (hereinafter in this Section
referred to as a "Lien") upon or with respect to the Capital Stock of
Consumers, Enterprises or NOMECO without making effective provision
whereby the General Term Notes shall (so long as any such other creditor
shall be so secured) be equally and ratably secured (along with any other
creditor similarly entitled to be secured) by a direct Lien on all
property subject to such Lien, provided, however, that the foregoing
restrictions shall not apply to:
(i) Liens for taxes, assessments or governmental charges or levies
to the extent not past due;
(ii) pledges or deposits to secure (a) obligations under workmen's
compensation laws or similar legislation, (b) statutory obligations of the
Company or (c) Support Obligations not to exceed $30 million at any one
time outstanding;
(iii) Liens imposed by law, such as materialmen's, mechanics',
carriers', workmen's and repairmen's Liens and other similar Liens arising
in the ordinary course of business securing obligations which are not
overdue or which have been fully bonded and are being contested in good
faith;
(iv) purchase money Liens upon or in property acquired and held by
the Company in the ordinary course of business to secure the purchase
price of such property or to secure Indebtedness incurred solely for the
purpose of financing the acquisition of any such property to be subject to
such Liens, or Liens existing on any such property at the time of
acquisition, or extensions, renewals or replacements of any of the
foregoing for the same or a lesser amount, provided that no such Lien
shall extend to or cover any property other than the property being
acquired and no such extension, renewal or replacement shall extend to or
cover property not theretofore subject to the Lien being extended, renewed
or replaced, and provided, further, that the aggregate principal amount of
the Indebtedness at any one time outstanding secured by Liens permitted by
this clause (iv) shall not exceed $10,000,000; and
(v) Liens not otherwise permitted by clauses (i) through (iv) of
this Section securing Indebtedness of the Company; provided that on the
date such Liens are created, and after giving effect to such Indebtedness,
the aggregate principal amount at maturity of all of the secured
Indebtedness of the Company at such date shall not exceed 10% of
Consolidated Assets at such date.
SECTION 509. Limitation on Consolidation, Merger, Sale or
Conveyance. So long as the General Term Notes are Outstanding, and
subject also to Article Eight of the Indenture, the Company shall not
consolidate with or merge into any other Person or sell, lease or convey
the property of the Company in the entirety or substantially as an
entirety, unless (i) immediately after giving effect to such transaction
the Consolidated Net Worth of the surviving entity is at least equal to
the Consolidated Net Worth of the Company immediately prior to the
transaction, and (ii) after giving effect to such transaction, the
surviving entity would be entitled to incur at least one dollar of
additional Indebtedness (other than revolving Indebtedness to banks)
without violation of the limitations in Section 510 hereof.
SECTION 510. Limitation on Consolidated Indebtedness. (a)
So long as any of the General Term Notes are Outstanding, the Company
shall not, and shall not permit any Restricted Subsidiary of the Company
to, issue, create, assume, guarantee, incur or otherwise become liable for
(collectively, "issue"), directly or indirectly, any Indebtedness unless
(i) the Consolidated Coverage Ratio of the Company and its Consolidated
Subsidiaries for the four consecutive fiscal quarters immediately
preceding the issuance of such Indebtedness (as shown by a pro forma
consolidated income statement of the Company and its Consolidated
Subsidiaries for the four most recent fiscal quarters ending at least 30
days prior to the issuance of such Indebtedness after giving effect to (i)
the issuance of such Indebtedness and (if applicable) the application of
the net proceeds thereof to refinance other Indebtedness as if such
Indebtedness was issued at the beginning of the period, (ii) the issuance
and retirement of any other Indebtedness since the first day of the period
as if such Indebtedness was issued or retired at the beginning of the
period and (iii) the acquisition of any company or business acquired by
the Company or any Subsidiary since the first day of the period (including
giving effect to the pro forma historical earnings of such company or
business), including any acquisition which will be consummated
contemporaneously with the issuance of such Indebtedness, as if in each
case such acquisition occurred at the beginning of the period) exceeds a
ratio of 1.6 to 1.0 and (ii), immediately after giving effect to the
issuance of such Indebtedness and (if applicable) the application of the
net proceeds thereof to refinance other Indebtedness, the Consolidated
Leverage Ratio is equal to or less than a ratio of 0.75 to 1.0.
(b) Notwithstanding the foregoing paragraph, the Company or
any Restricted Subsidiary may issue, directly or indirectly, the following
Indebtedness:
(1) Revolving Indebtedness to banks not to exceed
$450,000,000 in the aggregate outstanding principal amount at any
time;
(2) Indebtedness (other than Indebtedness described in
clause (1) of this Subsection) outstanding on the date of the
original Indenture, as set forth on Schedule 510(b)(2) attached
hereto and made a part hereof, and Indebtedness issued in exchange
for, or the proceeds of which are used to refund or refinance, any
Indebtedness permitted by this clause (2); provided, however, that
(i) the principal amount (or accreted value in the case of
Indebtedness issued at a discount) of the Indebtedness so issued
shall not exceed the principal amount (or accreted value in the
case of Indebtedness issued at a discount) of, premium, if any, and
accrued but unpaid interest on, the Indebtedness so exchanged,
refunded or refinanced and (ii) the Indebtedness so issued (A)
shall not mature prior to the stated maturity of the Indebtedness
so exchanged, refunded or refinanced, (B) shall have an Average
Life equal to or greater than the remaining Average Life of the
Indebtedness so exchanged, refunded or refinanced and (C) if the
Indebtedness to be exchanged, refunded or refinanced is
subordinated to the General Term Notes, the Indebtedness is
subordinated to the General Term Notes in right of payment;
(3) Indebtedness of the Company owed to and held by a
Subsidiary and Indebtedness of a Subsidiary owed to and held by the
Company; provided, however, that, in the case of Indebtedness of
the Company owed to and held by a Subsidiary, (i) any subsequent
issuance or transfer of any Capital Stock that results in any such
Subsidiary ceasing to be a Subsidiary or (ii) any transfer of such
Indebtedness (except to the Company or a Subsidiary) shall be
deemed for the purposes of this Subsection to constitute the
issuance of such Indebtedness by the Company;
(4) Indebtedness of the Company issued in exchange for, or
the proceeds of which are used to refund or refinance, Indebtedness
of the Company issued in accordance with Subsection (a) of this
Section, provided that (i) the principal amount (or accreted value
in the case of Indebtedness issued at a discount) of the
Indebtedness so issued shall not exceed the principal amount (or
accreted value in the case of Indebtedness issued at a discount)
of, premium, if any, and accrued but unpaid interest on, the
Indebtedness so exchanged, refunded or refinanced and (ii) the
Indebtedness so issued (A) shall not mature prior to the stated
maturity of the Indebtedness so exchanged, refunded or refinanced,
(B) shall have an Average Life equal to or greater than the
remaining Average Life of the Indebtedness so exchanged, refunded
or refinanced and (C) if the Indebtedness to be exchanged, refunded
or refinanced is subordinated to the General Term Notes, the
Indebtedness so issued is subordinated to the General Term Notes in
right of payment; and
(5) Indebtedness of a Restricted Subsidiary issued in
exchange for, or the proceeds of which are used to refund or
refinance, Indebtedness of a Restricted Subsidiary issued in
accordance with Subsection (a) of this Section, provided that (i)
the principal amount (or accreted value in the case of Indebtedness
issued at a discount) of the Indebtedness so issued shall not
exceed the principal amount (or accreted value in the case of
Indebtedness issued at a discount) of, premium, if any, and accrued
but unpaid interest on, the Indebtedness so exchanged, refunded or
refinanced and (ii) the Indebtedness so issued (A) shall not mature
prior to the stated maturity of the Indebtedness so exchanged,
refunded or refinanced and (B) shall have an Average Life equal to
or greater than the remaining Average Life of the Indebtedness so
exchanged, refunded or refinanced.
SECTION 511. Limitation on Restricted Payments.(a) So
long as the General Term Notes are Outstanding and are rated below BBB- by
Standard & Poor's or by Duff & Phelps (or, if Duff & Phelps or Standard &
Poor's shall change its rating system, an equivalent of such rating then
employed by such organization) the Company shall not, and shall not permit
any Restricted Subsidiary of the Company, directly or indirectly, to (i)
declare or pay any dividend or make any distribution on the Capital Stock
of the Company to the direct or indirect holders of the Capital Stock of
the Company (except dividends or distributions payable solely in Non-
Convertible Capital Stock of the Company or in options, warrants or other
rights to purchase such Non-Convertible Capital Stock and except dividends
or distributions payable to the Company or a Subsidiary), (ii) purchase,
redeem or otherwise acquire or retire for value any Capital Stock of the
Company (any such dividend, distribution, purchase, redemption, other
acquisition or retirement being hereinafter referred to as a "Restricted
Payment") if at the time the Company or such Subsidiary makes such
Restricted Payment:
(1) an Event of Default, or an event that with the
lapse of time or the giving of notice or both would constitute an
Event of Default, shall have occurred and be continuing (or would
result therefrom); or
(2) the aggregate amount of such Restricted Payment
and all other Restricted Payments made since September 30, 1993,
would exceed the sum of:
(A) $120,000,000;
(B) 100% of Consolidated Net Income, accrued during
the period (treated as one accounting period) from September
30, 1993 to the end of the most recent fiscal quarter ending
at least 45 days prior to the date of such Restricted
Payment (or, in case such sum shall be a deficit, minus 100%
of the deficit); and
(C) the aggregate Net Proceeds received by the
Company from the issue or sale of or contribution with
respect to its Capital Stock subsequent to September 30,
1993.
For the purpose of determining the amount of any Restricted Payment not in
the form of cash, the amount shall be the fair value of such Restricted
Payment as determined in good faith by the Board of Directors, provided
that if the value of the non-cash portion of such Restricted Payment as
determined by the Board of Directors is in excess of $25 million, such
value shall be based on the opinion from a nationally recognized firm
experienced in the appraisal of similar types of transactions.
(b) The provisions of Section 511(a) shall not prohibit:
(i) any purchase or redemption of Capital Stock of
the Company made by exchange for, or out of the proceeds of
the substantially concurrent sale of, Capital Stock of the
Company (other than Redeemable Stock or Exchangeable Stock);
provided, however, that such purchase or redemption shall be
excluded from the calculation of the amount of Restricted
Payments;
(ii) dividends or other distributions paid in
respect of any class of the Company's Capital Stock issued
in respect of the acquisition of any business or assets by
the Company or a Restricted Subsidiary if the dividends or
other distributions with respect to such Capital Stock are
payable solely from the net earnings of such business or
assets;
(iii) dividends paid within 60 days after the date
of declaration thereof if at such date of declaration such
dividend would have complied with this Section; provided,
however, that at the time of payment of such dividend, no
Event of Default shall have occurred and be continuing (or
result therefrom), and provided further, however, that such
dividends shall be included (without duplication) in the
calculation of the amount of Restricted Payments; or
(iv) payments pursuant to the Tax-Sharing Agreement.
SECTION 512. Limitation on Transactions with Affiliates.
So long as any of the General Term Notes are Outstanding, the Company
shall not directly or indirectly, conduct any business or enter into any
transaction or series of related transactions (including the purchase,
sale, lease or exchange of any property or the rendering of any service)
with an Affiliate unless the terms of such business, transaction or series
of transactions are as favorable to the Company as terms that could be
obtainable at the time for a comparable transaction or series of related
transactions in arm's-length dealings with an unrelated third Person.
This Section shall not apply to (x) compensation paid to officers and
directors of the Company which has been approved by the Board of Directors
of the Company or (y) loans to the Company or an Affiliate pursuant to a
global cash management program, which loans mature within one year from
the date thereof.
ARTICLE VI
ADDITIONAL EVENTS OF DEFAULT
WITH RESPECT TO THE GENERAL TERM NOTES
SECTION 601. Definition. All of the events specified in
Section 501 of the Indenture and the events specified in Section 602 of
this Article shall be "Events of Default" with respect to the General Term
Notes.
SECTION 602. Additional Events of Default. As contemplated
by Sections 301(15) and 501(7) of the Indenture, any one of the following
events (whatever the reason for such Event of Default and whether or not
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) shall be an
Event of Default with respect to the General Term Notes for all purposes
of the Indenture:
(a) a default or event of default in respect of any
Indebtedness of the Company having an aggregate outstanding principal
amount at the time of such default in excess of $25,000,000 shall occur
which results in the acceleration of such Indebtedness or Indebtedness of
the Company having an outstanding principal amount at maturity in excess
of $25,000,000 shall not be paid at maturity thereof, which default shall
not have been waived by the holder or holders of such Indebtedness within
30 days of such default; or
(b) the entry of a final judgment or judgments against the
Company aggregating in excess of $25,000,000 which remain undischarged or
unbonded for a period (during which execution shall not be effectively
stayed) of 60 days.
ARTICLE VII
GLOBAL NOTES
The General Term Notes will be issued initially in the form
of Global Notes. "Global Note" means a registered General Term Note
evidencing one or more General Term Notes issued to a depositary (the
"Depositary") or its nominee, in accordance with this Article and bearing
the legend prescribed in this Article. A single Global Note will
represent all General Term Notes issued on the same date and having the
same terms, including, but not limited to, the same Interest Payment
Dates, rate of interest, Stated Maturity, and redemption provisions (if
any). The Company shall execute and the Trustee shall, in accordance with
this Article and the Company Order with respect to the General Term Notes,
authenticate and deliver one or more Global Notes in temporary or
permanent form that (i) shall represent and shall be denominated in an
aggregate amount equal to the aggregate principal amount of the General
Term Notes to be represented by such Global Note or Notes, (ii) shall be
registered in the name of the Depositary for such Global Note or Notes or
the nominee of such Depositary, (iii) shall be delivered by the Trustee to
such Depositary or pursuant to such Depositary's instructions and (iv)
shall bear a legend substantially to the following effect: "Unless this
Global Note is presented by an authorized representative of the Depositary
to the Company or its agent for registration of transfer, exchange or
payment, and any Note issued is registered in the name of the Depositary
or in such other name as is requested by the Depositary, any transfer,
pledge or other use hereof for value or otherwise by or to any person
shall be wrongful inasmuch as the registered owner hereof, the Depositary,
has an interest herein."
Notwithstanding Section 305 of the Indenture, unless and
until it is exchanged in whole or in part for General Term Notes in
definitive form, a Global Note representing one or more General Term Notes
may not be transferred except as a whole by the Depositary, to a nominee
of such Depositary or by a nominee of such Depositary to such Depositary
or another nominee of such Depositary or by such Depositary or any such
nominee to a successor Depositary for General Term Notes or a nominee of
such successor Depositary.
If at any time the Depositary for the General Term Notes is
unwilling or unable to continue as Depositary for the General Term Notes,
the Company shall appoint a successor Depositary with respect to the
General Term Notes. If a successor Depositary for the General Term Notes
is not appointed by the Company by the earlier of (i) 90 days from the
date the Company receives notice to the effect that the Depositary is
unwilling or unable to act, or the Company determines that the Depositary
is unable to act or (ii) the effectiveness of the Depositary's resignation
or failure to fulfill its duties as Depositary, the Company will execute,
and the Trustee, upon receipt of a Company Order for the authentication
and delivery of definitive General Term Notes, will authenticate and
deliver General Term Notes in definitive form in an aggregate principal
amount equal to the principal amount of the Global Note or Notes
representing such General Term Notes in exchange for such Global Note or
Notes.
The Company may at any time and in its sole discretion
determine that the General Term Notes issued in the form of one or more
Global Notes shall no longer be represented by such Global Note or Notes.
In such event the Company will execute, and the Trustee, upon receipt of a
Company Order for the authentication and delivery of definitive General
Term Notes, will authenticate and deliver General Term Notes in definitive
form in an aggregate principal amount equal to the principal amount of the
Global Note or Notes representing such General Term Notes in exchange for
such Global Note or Notes.
The Depositary for such General Term Notes may surrender a
Global Note or Notes for such General Term Notes in exchange in whole or
in part for General Term Notes in definitive form on such terms as are
acceptable to the Company and such Depositary. Thereupon, the Company
shall execute, and the Trustee shall authenticate and deliver, without
service charge:
(i) to each Person specified by such Depositary a new
General Term Note or Notes, of any authorized denomination
as requested by such Person in aggregate principal amount
equal to and in exchange for such Person's beneficial
interest in the Global Note; and
(ii) to such Depositary a new Global Note in a
denomination equal to the difference, if any, between the
principal amount of the surrendered Global Note and the
aggregate principal amount of General Term Notes in
definitive form delivered to Holders thereof.
In any exchange provided for in this Article, the Company
will execute and the Trustee will authenticate and deliver General Term
Notes in definitive registered form in authorized denominations.
Upon the exchange of a Global Note for General Term Notes in
definitive form, such Global Note shall be cancelled by the Trustee.
General Term Notes in definitive form issued in exchange for a Global Note
pursuant to this Article shall be registered in such names and in such
authorized denominations as the Depositary for such Global Note, pursuant
to instructions from its direct or indirect participants or otherwise,
shall instruct the Trustee or Security Registrar. The Trustee shall
deliver such General Term Notes to the persons in whose names such General
Term Notes are so registered.
ARTICLE VIII
DEFEASANCE
All of the provisions of Article Fourteen of the Original
Indenture shall be applicable to the General Term Notes. Upon
satisfaction by the Company of the requirements of Section 1404 of the
Indenture, in connection with any covenant defeasance (as provided in
Section 1403 of the Indenture), the Company shall be released from its
obligations under Article Eight of the Original Indenture and under
Articles III and V of this Third Supplemental Indenture with respect to
the General Term Notes.
ARTICLE IX
SUPPLEMENTAL INDENTURES
This Third Supplemental Indenture is a supplement to the
Original Indenture. As supplemented by this Third Supplemental Indenture,
the Original Indenture is in all respects ratified, approved and
confirmed, and the Original Indenture and this Third Supplemental
Indenture shall together constitute one and the same instrument.
The Company may, by supplemental indenture, amend this Third
Supplemental Indenture to provide for additional definitions, terms and
provisions relating to General Term Notes. Any such supplemental
indenture shall not adversely affect the rights and privileges of Holders
of General Term Notes issued prior to such supplemental indenture. Any
such supplemental indenture may include, but is not limited to including,
additional provisions permitting payment of General Term Notes prior to
Stated Maturity at the option of the Holders, issuance of General Term
Notes in currencies other than Dollars, and special provisions relating to
interest rate provisions.
<PAGE>
<PAGE>
TESTIMONIUM
This Third Supplemental Indenture may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and
the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Third Supplemental Indenture to be duly executed and their respective
corporate seals to be hereunto affixed and attested, all as of the day and
year first written above.
CMS ENERGY CORPORATION
By: /s/ Alan M. Wright
__________________
Attest:
/s/ Thomas A. McNish (Corporate Seal)
____________________
THE CHASE MANHATTAN BANK
as Trustee
By: /s/ Mary Lewicki
________________
Attest:
/s/John J. Needham, Jr. (Corporate Seal)
_______________________<PAGE>
<PAGE>
Schedule 510(b)(2)
Indebtedness of CMS Energy Corporation outstanding on January 20, 1994:
1. $146,000,000 of Series A Senior Deferred Coupon Notes due 1997; and
2. $248,000,000 of Series B Senior Deferred Coupon Notes due 1999.
