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Exhibit
4(a)
SOUTHWESTERN
ELECTRIC POWER COMPANY
and
THE
BANK OF NEW YORK,
AS
TRUSTEE
___________________
SEVENTH
SUPPLEMENTAL INDENTURE
Dated
as of June 9, 2008
Supplemental
to the Indenture
dated
as of February 25, 2000
6.45%
Senior Notes, Series G, due 2019
SEVENTH SUPPLEMENTAL
INDENTURE, dated as of June 9, 2008, between SOUTHWESTERN
ELECTRIC POWER COMPANY, a corporation duly organized and
existing under the laws of the State of Delaware (the
"Company"), and THE BANK OF NEW YORK, a New York banking
corporation organized and existing under the laws of the
State of New York, as Trustee under the Original Indenture
referred to below (the "Trustee").
RECITALS
OF THE COMPANY
The Company has heretofore
executed and delivered to the Trustee an indenture dated as
of February 25, 2000 (the "Original Indenture"), to provide
for the issuance from time to time of its debentures, notes
or other evidences of indebtedness (the "Senior Notes"), the
form and terms of which are to be established as set forth in
Section 201 and 301 of the Original Indenture.
Section 901 of the Original
Indenture provides, among other things, that the Company and
the Trustee may enter into indentures supplemental to the
Original Indenture for, among other things, the purpose of
establishing the form and terms of the Senior Notes of any
series as permitted in Sections 201 and 301 of the Original
Indenture.
The Company desires to
create a series of the Senior Notes in an aggregate principal
amount of $400,000,000 to be designated the "6.45% Senior
Notes, Series G, due 2019" (the "Series G Notes"), and all
action on the part of the Company necessary to authorize the
issuance of the Series G Notes under the Original Indenture
and this Seventh Supplemental Indenture has been duly
taken.
All acts and things
necessary to make the Series G Notes, when executed by the
Company and completed, authenticated and delivered by the
Trustee as provided in the Original Indenture and this
Seventh Supplemental Indenture, the valid and binding
obligations of the Company and to constitute these presents a
valid and binding supplemental indenture and agreement
according to its terms, have been done and
performed.
NOW,
THEREFORE, THIS SEVENTH SUPPLEMENTAL INDENTURE
WITNESSETH:
That
in consideration of the premises and of the acceptance and
purchase of the Series G Notes by the Holders thereof and of
the acceptance of this trust by the Trustee, the Company
covenants and agrees with the Trustee, for the equal benefit
of the Holders of the Series G Notes, as follows:
ARTICLE
ONE
Definitions
SECTION
101. Definitions.
The use of the terms and
expressions herein is in accordance with the definitions,
uses and constructions contained in the Original Indenture
and the form of the Series G Note attached hereto as
Exhibit
A .
ARTICLE
TWO
Terms
and Issuance of the Series G Notes
SECTION
201.
Issue of Series
G Notes .
A series of Senior Notes
which shall be designated the "6.45% Senior Notes,
Series G, due 2019" shall be executed, authenticated and
delivered from time to time in accordance with the provisions
of, and shall in all respects be subject to, the terms,
conditions and covenants of, the Original Indenture and this
Seventh Supplemental Indenture (including the form of Series
G Note set forth in Exhibit
A hereto). The aggregate principal amount
of the Series G Notes which may be authenticated and
delivered under this Seventh Supplemental Indenture shall
initially be $400,000,000, and such principal amount of the
Series G Notes may be increased from time to
time. All Series G Notes need not be issued at the
same time and such series may be reopened at any time,
without the consent of any Holder, for the issuance of
additional Series G Notes. Any such additional
Series G Notes will have the same interest rate, maturity and
other terms as those initially issued.
SECTION
202.
Form
of Series G Notes; Incorporation of Terms
.
The Series G Notes shall be
issued initially in the form of one Global
Security. The form of the Series G Notes shall be
substantially in the form of the Global Security attached
hereto as Exhibit
A . The terms of such Series G Notes are
herein incorporated by reference and are part of this Seventh
Supplemental Indenture.
SECTION
203.
Depositary for
Global Securities .
The Depositary for any
Global Securities of the series of which this Series G Note
is a part shall be The Depository Trust Company in The City
of New York.
SECTION
204.
Restrictions on
Liens .
The covenant contained in
Section 1007 of the Original Indenture shall not be
applicable to the Series G Notes.
So
long as any of the Series G Notes are outstanding, the Company
will not create or suffer to be created or to exist any
additional mortgage, pledge, security interest, or other lien
(collectively "Liens") on any of its utility properties or
tangible assets now owned or hereafter acquired to secure any
indebtedness for borrowed money ("Secured Debt"), without
providing that the Series G Notes will be similarly
secured. This restriction does not apply to the
Company's subsidiaries, nor will it prevent any of them from
creating or permitting to exist Liens on their property or
assets to secure any Secured Debt. In addition,
this restriction does not prevent the creation or existence
of:
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(a)
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Liens
on property existing at the time of acquisition or
construction of such property (or created within one year
after completion of such acquisition or construction), whether
by purchase, merger, construction or otherwise, or to secure
the payment of all or any part of the purchase price or
construction cost thereof, including the extension of any
Liens to repairs, renewals, replacements, substitutions,
betterments, additions, extensions and improvements then or
thereafter made on the property subject thereto;
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(b)
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Financing
of the Company's accounts receivable for electric
service;
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(c)
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Any
extensions, renewals or replacements (or successive
extensions, renewals or replacements), in whole or in part, of
liens permitted by the foregoing clauses; and
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(d)
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The
pledge of any bonds or other securities at any time issued
under any of the Secured Debt permitted by the above
clauses.
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In
addition to the permitted issuances above, Secured Debt not
otherwise so permitted may be issued in an amount that does
not exceed 15% of Net Tangible Assets as defined
below.
“Net
Tangible Assets” means the total of all assets
(including revaluations thereof as a result of commercial
appraisals, price level restatement or otherwise) appearing on
the Company’s balance sheet, net of applicable reserves
and deductions, but excluding goodwill, trade names,
trademarks, patents, unamortized debt discount and all other
like intangible assets (which term shall not be construed to
include such revaluations), less the aggregate of the
Company’s current liabilities appearing on such balance
sheet. For purposes of this definition, the
Company’s balance sheet does not include assets and
liabilities of its subsidiaries.
This
restriction also does not apply to or prevent the creation or
existence of leases made, or existing on property acquired, in
the ordinary course of business.
SECTION
205.
Place of
Payment .
The Place of Payment in
respect of the Series G Notes will be at the principal office
or place of business of the Trustee or its successor in trust
under the Indenture, which, at the date hereof, is located at
101 Barclay Street, New York, NY 10286, Attention: Corporate
Trust Administration.
SECTION
206. Optional
Redemption .
The
Series G Notes may be redeemed at the Company’s option
at any time upon no more than 60 and not less than 30
days’ notice by mail. The Series G Notes may
be redeemed either as a whole or in part at a redemption price
equal to the greater of (1) 100% of the principal amount of
the Series G Notes being redeemed and (2) the sum of the
present values of the remaining scheduled payments of
principal and interest on the Series G Notes being redeemed
(excluding the portion of any such interest accrued to the
date of redemption) discounted (for purposes of determining
present value) to the redemption date on a semi-annual basis
(assuming a 360-day year consisting of twelve 30-day months)
at the Treasury Rate (as defined below) plus 50 basis points;
plus, in each case, accrued interest thereon to the date of
redemption.
"Business Day" means any day that is not a day on which banking
institutions in New York City are authorized or required by law or
regulation to close.
“Comparable Treasury
Issue” means the United States Treasury security
selected by an Independent Investment Banker as having a
maturity comparable to the remaining term (“remaining
life”) of the Series G Notes that would be utilized, at
the time of selection and in accordance with customary
financial practice, in pricing new issues of corporate debt
securities of comparable maturity to the remaining life of
the Series G Notes.
“Comparable Treasury
Price” means, with respect to any redemption date, (1)
the average of the Reference Treasury Dealer Quotations for
such redemption date, after excluding the highest and lowest
such Reference Treasury Dealer Quotations, or (2) if the
Company obtains fewer than four such Reference Treasury
Dealer Quotations, the average of all such
quotations.
“Independent
Investment Banker” means one of the Reference Treasury
Dealers appointed by the Company and reasonably acceptable to
the Trustee.
“Reference Treasury
Dealer” means BNP Paribas Securities Corp., Credit
Suisse Securities (USA) LLC, and J. P. Morgan Securities Inc.
and their respective successors; provided, however, that if
any of the foregoing shall cease to be a Reference Treasury
Dealer the Company will substitute therefor a primary U.S.
government securities dealer reasonably acceptable to the
Trustee.
“Reference Treasury
Dealer Quotations” means, with respect to each
Reference Treasury Dealer and any redemption date, the
average, as determined by the Trustee, of the bid and asked
prices for the Comparable Treasury Issue (expressed in each
case as a percentage of its principal amount) quoted in
writing to the Trustee by such Reference Treasury Dealer at
or before 3:30 p.m., New York City time, on the third
Business Day preceding such redemption date.
“Treasury Rate”
means (i) the yield, under the heading which represents the
average for the immediately preceding week, appearing in the
most recently published statistical release designated
“H.15(519)” or any successor publication which is
published weekly by the Board of Governors of the Federal
Reserve System and which establishes yields on actively
traded U.S. Treasury securities adjusted to constant maturity
under the caption “Treasury Constant Maturities,”
for the maturity corresponding to the Comparable Treasury
Issue (if no maturity is within three months before or after
the remaining life (as defined above), yields for the two
published maturities most closely corresponding to the
Comparable Treasury Issue will be determined and the Treasury
Rate will be interpolated or extrapolated from such yields on
a straight line basis, rounding to the nearest month); or
(ii) if such release (or any successor release) is not
published during the week preceding the calculation date or
does not contain such yields, the rate per annum equal to the
semiannual equivalent yield to maturity of the Comparable
Treasury Issue, calculated using a price for the Comparable
Treasury Issue (expressed as a percentage of its principal
amount) equal to the Comparable Treasury Price for such
redemption date.
SECTION
207. Sinking
Funds .
Article
Twelve of the Indenture shall not apply to the Series G
Notes.
SECTION
208. Regular Record
Date .
The
"Regular Record Date" will be the January 1 or July 1, as the
case may be, next preceding an interest payment date (whether
or not a business day).
ARTICLE
THREE
Miscellaneous
SECTION
301.
Execution as
Supplemental Indenture .
This Seventh Supplemental
Indenture is executed and shall be construed as an indenture
supplemental to the Original Indenture and, as provided in
the Original Indenture, this Seventh Supplemental Indenture
forms a part thereof.
SECTION
302.
Conflict with
Trust Indenture Act .
If any provision hereof
limits, qualifies or conflicts with another provision hereof
which is required to be included in this Seventh Supplemental
Indenture by any of the provisions of the Trust Indenture
Act, such required provision shall control.
SECTION
303.
Effect of
Headings .
The Article and Section
headings herein are for convenience only and shall not affect
the construction hereof.
SECTION
304.
Successors and
Assigns .
All covenants and
agreements by the Company in this Seventh Supplemental
Indenture shall bind its successors and assigns, whether so
expressed or not.
SECTION
305.
Separability
Clause .
In case any provision in
this Seventh Supplemental Indenture or in the Series G Notes
shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall
not in any way be affected or impaired thereby.
SECTION
306.
Benefits of
Seventh Supplemental Indenture .
Nothing in this Seventh
Supplemental Indenture or in the Series G Notes, express or
implied, shall give to any Person, other than the parties
hereto and their successors hereunder and the Holders, any
benefit or any legal or equitable right, remedy or claim
under this Seventh Supplemental Indenture.
SECTION
307.
Execution and
Counterparts .
This Seventh Supplemental
Indenture may be executed in any number of counterparts, each
of which shall be deemed to be an original, but all such
counterparts shall together constitute but one and the
same
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