-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VZNsGhfu3PDN5+R5Lgcd3wZZlkNCdNN4JSIEuxm00hDhbzIcPcbmE/H+kwPlIZbj FN0O8ttdEWfvgsJNtGeTYQ== 0000950120-01-500281.txt : 20020412 0000950120-01-500281.hdr.sgml : 20020412 ACCESSION NUMBER: 0000950120-01-500281 CONFORMED SUBMISSION TYPE: S-4 PUBLIC DOCUMENT COUNT: 23 FILED AS OF DATE: 20011205 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DPL CAPITAL TRUST II CENTRAL INDEX KEY: 0001161991 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 316674982 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-74630-01 FILM NUMBER: 1807537 BUSINESS ADDRESS: STREET 1: PO BOX 8825 CITY: DAYTON STATE: OH ZIP: 45401 BUSINESS PHONE: 5132246000 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DPL INC CENTRAL INDEX KEY: 0000787250 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 311163136 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-74630 FILM NUMBER: 1807536 BUSINESS ADDRESS: STREET 1: PO BOX 8825 CITY: DAYTON STATE: OH ZIP: 45401 BUSINESS PHONE: 5132246000 MAIL ADDRESS: STREET 1: PO BOX 8825 CITY: DAYTON STATE: OH ZIP: 45401 S-4 1 d429734.txt FORM S-4 As filed with the Securities and Exchange Commission on December 5, 2001 Registration No. 333- ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------- FORM S-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ---------------- DPL INC. (Exact name of registrant as specified in its charter) OHIO 4931 31-1163136 (State or other jurisdiction of (Primary Standard (I.R.S. Employer incorporation or organization) Industrial Code Number) Identification No.) DPL CAPITAL TRUST II (Exact name of registrant as specified in its charter) DELAWARE 6719 31-6674982 (State or other jurisdiction of (Primary Standard (I.R.S. Employer incorporation or organization) Industrial Code Number) Identification No.) COURTHOUSE PLAZA SOUTHWEST DAYTON, OHIO 45402 (937) 224-6000 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Stephen F. Koziar, Jr., Esq. J. Michael Parish, Esq. DPL Inc. Thelen Reid & Priest LLP Courthouse Plaza Southwest 40 West 57th Street Dayton, Ohio 45402 New York, New York 10019 (937) 224-6000 (212) 603-2154 (Names and addresses, including zip codes, and telephone numbers, including area codes, of agents for service) ---------------- Approximate date of commencement of proposed sale of the securities to the public: AS SOON AS PRACTICABLE AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE. ---------------- If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. [ ] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] -------------------- CALCULATION OF REGISTRATION FEE
TITLE OF EACH CLASS OF SECURITIES PROPOSED MAXIMUM AGGREGATE TO BE AMOUNT TO BE OFFERING PRICE OFFERING AMOUNT OF REGISTERED REGISTERED PER UNIT (1) PRICE (1) REGISTRATION FEE 8 1/8% Capital Securities of DPL 300,000 $1,000 $300,000,000 $71,700 Capital Trust II 8 1/8% Junior Subordinated -- -- -- Deferrable Interest Debentures of DPL Inc. (2) DPL Inc. Guarantee with respect -- -- -- to 8 1/8% Capital Securities(2) Total (3) 300,000 $1,000 $300,000,000 (4) $71,700
(1) Determined solely for the purpose of calculating the registration fee pursuant to Rule 457(f)(2) promulgated under the Securities Act. (2) No separate consideration will be received for the 8 1/8% Junior Subordinated Deferrable Interest Debentures of DPL Inc. distributed upon any liquidation of DPL Capital Trust II, and no separate consideration will be received for the DPL Inc. Guarantee. (3) This Registration Statement is deemed to cover rights of holders of 8 1/8% Junior Subordinated Deferrable Interest Debentures under the Indenture, the rights of the holders of 8 1/8% Capital Securities of DPL Capital Trust II under an Amended and Restated Declaration of Trust, the rights of holders of such 8 1/8% Capital Securities under the Guarantee and certain backup undertakings as described in this Registration Statement. (4) Such amount represents the liquidation amount of the 8 1/8% Capital Securities to be exchanged hereunder and the principal amount of 8 1/8% Junior Subordinated Deferrable Interest Debentures that may be distributed to holders of such 8 1/8% Capital Securities upon any liquidation of DPL Capital Trust II. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. - -------------------------------------------------------------------------------- RED HERRING The information in this prospectus is not complete and may be changed. We may not sell these sexurities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to exchange these securities and it is not soliciting an offer to exchange these securities in any jurisdiction in which the offer or exchange is not permitted. - -------------------------------------------------------------------------------- Subject to completion, dated , 2002 PROSPECTUS DPL CAPITAL TRUST II EXCHANGE OFFER DPL CAPITAL TRUST II IS OFFERING TO EXCHANGE ITS 8 1/8% CAPITAL SECURITIES (REGISTERED) (LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY) FOR ANY AND ALL OF ITS OUTSTANDING 8 1/8% CAPITAL SECURITIES (UNREGISTERED) (LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY) FULLY AND UNCONDITIONALLY GUARANTEED, TO THE EXTENT PROVIDED IN THIS PROSPECTUS, BY DPL INC. THIS EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M. NEW YORK CITY TIME, , 200_ UNLESS EXTENDED DPL Capital Trust II is offering upon the terms and subject to the conditions set forth in the prospectus, as amended and supplemented from time to time, and in the accompanying letter of transmittal, which together constitute the exchange offer, to exchange up to and including $300,000,000 aggregate liquidation amount of its 8 1/8% Capital Securities, referred to in this prospectus as the exchange capital securities, which have been registered under the Securities Act of 1933, as amended, by a registration statement of which this prospectus is a part, for a like amount of its outstanding 8 1/8% Capital Securities, referred to in this prospectus as the old capital securities, which have not been registered and of which $300,000,000 aggregate liquidation amount are issued and outstanding. The old capital securities and the exchange capital securities are collectively referred to in this prospectus as the capital securities. This prospectus and the letter of transmittal are first being mailed to all holders of the old capital securities on or about , 200_ See "Risk Factors" beginning on page 9 to read about the risks that you should consider in deciding whether to tender the old capital securities in the exchange offer. These securities are not deposits or accounts and are not insured by the Federal Deposit Insurance Corporation or any other government agency. Neither the Securities and Exchange Commission nor any state securities commission or regulator has approved or disapproved these securities or determined that this prospectus is accurate or complete. It is illegal for anyone to tell you otherwise. The date of this prospectus is , 2002. This prospectus incorporates by reference important business and financial information about DPL Inc. that is not included in or delivered with this prospectus. See "Where You Can Find More Information". You may obtain copies of documents containing such information from us, without charge, by either calling or writing to us at: DPL Inc. Financial Activities Box 8825 Dayton, Ohio 45401 (937) 259-7150 In order to obtain timely delivery, you must request documents from us no later than ___, 200_, which is five days before the expiration date of the exchange offer on ______, 200_. 2 TABLE OF CONTENTS
Page Page ---- ---- WHERE YOU CAN FIND MORE DESCRIPTION OF EXCHANGE INFORMATION...............................4 DEBENTURES.............................30 FORWARD-LOOKING STATEMENTS................5 DESCRIPTION OF EXCHANGE GUARANTEE..............................38 DPL INC...................................5 DESCRIPTION OF OLD SECURITIES..........42 RATIOS OF EARNINGS TO FIXED CHARGES...................................5 RELATIONSHIP AMONG THE EXCHANGE CAPITAL SECURITIES, THE EXCHANGE CAPITALIZATION............................6 DEBENTURES AND THE EXCHANGE GUARANTEE..............................42 DPL CAPITAL TRUST II......................6 CERTAIN UNITED STATES FEDERAL ACCOUNTING TREATMENT FOR THE INCOME TAX CONSEQUENCES................43 TRUST.....................................7 CERTAIN ERISA CONSIDERATIONS...........48 RISK FACTORS..............................7 PLAN OF DISTRIBUTION...................49 USE OF PROCEEDS..........................10 LEGAL MATTERS..........................50 THE EXCHANGE OFFER.......................10 EXPERTS................................50 DESCRIPTION OF EXCHANGE CAPITAL SECURITIES...............................17
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS OR IN THE LETTER OF TRANSMITTAL IN CONNECTION WITH THE EXCHANGE OFFER. WE HAVE NOT AUTHORIZED ANYONE TO GIVE YOU ANY INFORMATION OTHER THAN THIS PROSPECTUS. YOU SHOULD NOT ASSUME THAT THE INFORMATION CONTAINED OR INCORPORATED IN THIS PROSPECTUS IS ACCURATE AS OF ANY DATE AFTER THE DATE OF THIS PROSPECTUS. THIS PROSPECTUS IS NOT AN OFFER TO EXCHANGE THE OLD NOTES FOR THE EXCHANGE NOTES AND IT IS NOT SOLICITING AN OFFER TO EXCHANGE THE OLD NOTES IN ANY JURISDICTION IN WHICH THE EXCHANGE OFFER IS NOT PERMITTED. 3 WHERE YOU CAN FIND MORE INFORMATION We have filed a registration statement on Form S-4 under the Securities Act of 1933, as amended, with the Securities and Exchange Commission to register the exchange capital securities to be issued in the exchange offer. This prospectus is a part of that registration statement. As allowed by Commission rules, this prospectus does not contain all of the information that you can find in the registration statement or the exhibits to the registration statement. We are subject to the informational requirements of the Securities Exchange Act of 1934, and in accordance therewith, we file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read and copy any documents we file at the SEC's public reference room, 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. Our SEC filings are also available to the public on the SEC's web site at http://www.sec.gov and through the New York Stock Exchange, 20 Broad Street, New York, New York 10005, on which our common stock is listed. We incorporate by reference into this prospectus the following documents that we have filed with the SEC: o Annual Report on Form 10-K for the fiscal year ended December 31, 2000; o Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2001; o Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2001; o Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2001; o Current Report on Form 8-K dated August 23, 2001; o Current Report on Form 8-K dated August 31, 2001; and o Current Report on Form 8-K dated September 25, 2001. In addition, all documents filed by us pursuant to Section 13, 14 or 15(d) of the Exchange Act, subsequent to the date of this prospectus and prior to the termination of this offering, shall be deemed to be incorporated by reference in this prospectus and to be a part of this prospectus from the date of filing of such documents. You may obtain copies of these documents from us, without charge, by calling or writing to us at: DPL Inc. Financial Activities Box 8825 Dayton, Ohio 45401 (937) 259-7150 Unless we have indicated otherwise, or the context otherwise requires, for purposes of this prospectus (1) references to "DPL," "we," "us," and "our," or similar terms, are to DPL Inc., an Ohio corporation, (2) references to "DPL Capital Trust II" or the "trust" are to DPL Capital Trust II, a statutory business trust formed under the laws of the State of Delaware, (3) "indenture" means the Junior Subordinated Indenture, as amended and supplemented by the First Supplemental Indenture between DPL and The Bank of New York, as indenture trustee relating to the junior subordinated debentures acquired by the trust in connection with issuance of the old capital securities, referred to in this prospectus as the "old debentures", and the junior subordinated debentures being exchanged for the old debentures, referred to in this prospectus as the "exchange debentures", (4) "trust agreement" means the Amended and Restated Trust Agreement relating to the trust among DPL, as depositor, The Bank of New York, as property trustee, The Bank of New York (Delaware), as Delaware trustee, and the administrative trustees named therein, (5) "exchange guarantee" means the registered Capital Securities Guarantee Agreement between DPL and The Bank 4 of New York, as guarantee trustee, relating to the DPL guarantee with respect to the exchange capital securities and (6) "expense agreement" means the Agreement as to Expenses and Liabilities between DPL and the trust. FORWARD-LOOKING STATEMENTS We caution you that this prospectus and the periodic reports and other documents that are incorporated by reference in this prospectus contain forward-looking statements. They are statements about future performance or results (such as statements including, but not limited to, the terms "potential," "estimate," "believe," "expect" and "anticipate" and similar words) when we discuss our financial condition, results of operations and business. Investors are cautioned that actual outcomes and results may vary materially from those projected due to various factors beyond our control, including abnormal weather, unusual maintenance or repair requirements, changes in fuel costs, increased competition, regulatory changes and decisions, changes in accounting rules, litigation affecting us and our subsidiaries (including with respect to environmental matters) and adverse economic or capital markets conditions. DPL INC. DPL Inc. was organized in 1985 as a holding company and is a diversified regional merchant energy company. Our principal subsidiary is The Dayton Power and Light Company, a public utility incorporated under the laws of the State of Ohio in 1911. Dayton Power and Light sells electricity to residential, commercial and governmental customers in a 6,000 square mile area of West Central Ohio. Electricity for its 24 county service area is generated at eight power plants and is distributed to 500,000 retail customers. Principal industries served include electrical machinery, automotive and other transportation equipment, non-electrical machinery, agriculture, paper, and rubber and plastic products. Dayton Power and Light's sales reflect the general economic conditions and seasonal weather patterns of the area. DPL and its subsidiaries are exempt from registration with the Securities and Exchange Commission under the Public Utility Holding Company Act of 1935 because its utility business operates solely in the State of Ohio. Our principal executive offices are located at Courthouse Plaza Southwest, Dayton, Ohio 45402. Our telephone number is (937) 224-6000. RATIOS OF EARNINGS TO FIXED CHARGES The following table sets forth our historical ratios of earnings to fixed charges for the periods indicated.
NINE MONTHS ENDED SEPTEMBER 30, YEAR ENDED DECEMBER 31, ------------- ----------------------- 2001 2000 2000 1999 1998 1997 1996 ---- ---- ---- ---- ---- ---- ---- Ratios of Earnings to Fixed Charges.................................. 3.24 2.06 2.95 4.00 4.33 4.32 4.10
For purposes of computing the foregoing ratios: o Earnings consist of pre-tax income from continuing operations plus fixed charges; and o Fixed charges consist of interest on indebtedness, trust preferred distributions by our subsidiary (including original issue discount amortization) and the portion of rental payments on operating leases estimated to represent an interest component. 5 We recognized original issue discount of $50 million in 2000 related to the February 2000 issuance by our subsidiary, DPL Capital Trust I, of $550 million trust preferred securities. Excluding this original issue discount amortization and the $183 million pre-tax gain on the October 2000 sale of our natural gas retail distribution business, the ratio of earnings to fixed charges for the nine months ended September 30, 2000 and the year ended December 31, 2000 was 2.47 and 2.47, respectively. CAPITALIZATION The following table shows our consolidated capitalization at September 30, 2001. Our consolidated capitalization numbers will not be affected by this exchange offer.
SEPTEMBER 30, 2001 ------------------ Long-Term Debt (excluding current portion)................ $2,150.9 65.1% Company Obligated Mandatorily Redeemable Trust Preferred Securities of Subsidiary Holding Solely Parent Debentures................................ 292.3 8.8% Preferred Stock: With Mandatory Redemption Provisions................. 0.1 --- Without Mandatory Redemption Provisions.............. 22.9 0.7% Common Shareholders' Equity............................... 838.1 25.4% -------- ------ Total Capitalization................................. $3,304.3 100.0% ======== ======
DPL CAPITAL TRUST II DPL Capital Trust II is a statutory business trust formed under the laws of the State of Delaware, governed by a trust agreement among us, as depositor, The Bank of New York, as property trustee, The Bank of New York (Delaware), as Delaware trustee, and two individual administrative trustees who are employees or officers affiliated with us. The trust exists for the exclusive purposes of: o issuing and selling the common securities, the old capital securities and the exchange capital securities representing undivided beneficial interests in the assets of the trust; o using the proceeds from the sale of the old capital securities to acquire the old debentures; o exchanging the old debentures for exchange debentures in the exchange offer pursuant to the indenture; and o engaging in only those other activities necessary, convenient or incidental to these purposes. Therefore, following the exchange offer, the exchange debentures will be the sole assets of the trust and payments by us under the exchange debentures will be the sole revenues of the trust. We will own all of the common securities of the trust. The common securities rank equally, and will be paid pro rata, with the capital securities. However, upon the occurrence and continuation of an event of default under the trust agreement resulting from our default on the exchange debentures, our rights to payment as holder of the common securities will be subordinated to the rights of the holders of the capital securities. The liquidation amount of the common securities is equal to approximately 3% of the total capital of the trust. The trust has a term of approximately 31 years, but may terminate earlier as provided in the trust agreement. As holder of the common securities, we will appoint the trustees to conduct the business and affairs of the trust. We have paid all fees and expenses related to the formation of the trust and the offering of the old capital securities, will pay all fees and expenses related to the exchange offer and issuance of the exchange capital securities and will pay, directly or indirectly, all ongoing costs, expenses and liabilities of the trust under the expense agreement. 6 Pursuant to the expense agreement, we have irrevocably and unconditionally guaranteed to each person or entity to whom the trust becomes indebted or liable, the full payment of any costs, expenses or liabilities of the trust, other than obligations of the trust to pay to the holders of any capital securities the amounts due such holders pursuant to the terms of the capital securities. The principal executive office of the trust is c/o DPL Inc., Courthouse Plaza Southwest, Dayton, Ohio 45402 and the telephone number is (937) 224-6000. ACCOUNTING TREATMENT FOR THE TRUST For financial reporting purposes, the trust is treated as our subsidiary and, accordingly, the accounts of the trust will be included in our consolidated financial statements. The capital securities will be presented as a separate line item in our consolidated balance sheet and appropriate disclosures about the capital securities, the exchange guarantee and the exchange debentures will be included in the notes to the consolidated financial statements. For financial reporting purposes, we will record distributions payable on the capital securities as a charge in the consolidated statement of results of operations. We will not prepare separate financial statements of the trust and therefore none are included in this prospectus. We do not consider that these financial statements will be material to the holders of capital securities because the trust is a special purpose entity owned by us with no operating history or independent operations and has not engaged in and does not propose to engage in any activity other than as described under "DPL Capital Trust II" above. RISK FACTORS An investment in the exchange capital securities involves a number of risks. You should carefully consider the following information, together with the other information in this prospectus and the documents that are incorporated by reference in this prospectus, about risks concerning the exchange capital securities, before exchanging your old capital securities for any exchange capital securities. IF WE DO NOT MAKE PAYMENTS ON THE EXCHANGE DEBENTURES, THE TRUST WILL NOT BE ABLE TO PAY DISTRIBUTIONS AND OTHER AMOUNTS DUE ON THE EXCHANGE CAPITAL SECURITIES AND THE EXCHANGE GUARANTEE WILL NOT APPLY. The trust will depend solely upon our payment of amounts when due on the exchange debentures in order to pay amounts due to you on the exchange capital securities. If we fail to pay principal or interest when due on the exchange debentures, the trust will not have funds to pay distributions on, or amounts due on redemption or liquidation of, the exchange capital securities or amounts due on the liquidation of the trust. If this happens, holders of exchange capital securities will not be able to rely upon the exchange guarantee for payment of those amounts because the exchange guarantee only guarantees that we will make distributions and redemption payments on the exchange capital securities if the trust has the funds to do so itself but does not. Instead, you or the property trustee may proceed directly against us for payment of any amounts due on the exchange capital securities. HOLDERS OF OUR SENIOR INDEBTEDNESS WILL GET PAID BEFORE YOU WILL GET PAID UNDER THE EXCHANGE DEBENTURES OR THE EXCHANGE GUARANTEE. Our obligations under the exchange debentures are unsecured and rank subordinate and junior in right of payment to all of our senior indebtedness. Our obligations under the exchange guarantee are unsecured and rank subordinate and junior in right of payment to all of our liabilities, including our obligations under the exchange debentures, other than any liabilities which expressly rank equally with, or are subordinate to our obligations under, the exchange guarantee. At September 30, 2001, our aggregate outstanding senior indebtedness was approximately $1,084 million. None of the indenture, the exchange guarantee or the trust agreement places any limitation on the amount of secured or unsecured debt, including senior indebtedness, that we or our subsidiaries may incur. 7 In addition, we are a holding company that derives substantially all of our income from our operating subsidiaries. Our operating subsidiaries are separate and distinct legal entities and will have no obligation, contingent or otherwise, to pay any dividends or make any other distributions to us or to otherwise pay amounts due with respect to the exchange debentures or the exchange guarantee or to make funds available for such payments. Therefore, the exchange debentures will also be effectively subordinated to all existing and future debt, liabilities and preferred stock at the subsidiary level. As of September 30, 2001, our subsidiaries, including The Dayton Power and Light Company, had approximately $690 million of aggregate outstanding debt and preferred stock. Holders of exchange debentures and claimants under the exchange guarantee should look only to our assets for payments on the exchange debentures or the exchange guarantee. WE MAY EXTEND THE INTEREST PAYMENT PERIOD ON THE EXCHANGE DEBENTURES. So long as no event of default under the indenture has occurred and is continuing, we have the right to defer the payment of interest on the exchange debentures, from time to time, for a period not exceeding 10 consecutive semi-annual periods. During the extension period, we have the right to make partial payments of interest on any interest payment date. No extension period may extend beyond the stated maturity of the exchange debentures or any earlier redemption date. Semi-annual distributions on the exchange capital securities by the trust will be deferred during any extension period, and unpaid distributions will accumulate additional distributions at the rate of 8 1/8% per annum, compounded semi-annually from the relevant payment date. At the end of any extension period, we may further extend the extension period, provided that this extension does not exceed 10 consecutive semi-annual periods or extend beyond the stated maturity of the exchange debentures or any earlier redemption date. At any time following the termination of an extension period and the payment of all amounts then due, we may elect to begin a new extension period, subject to the foregoing requirements. There is no limitation on the number of times that we may elect to begin an extension period. If we exercise this extension right, the exchange capital securities may trade at a price that does not fully reflect the value of the accumulated but unpaid distributions. If you dispose of the exchange capital securities during an extension period, you might not recover the same return on your investment as someone who continues to hold the exchange capital securities. Even if we do not exercise this right, our right to do so could mean that the market price for the exchange capital securities may be more volatile than that for debt instruments or other securities without similar deferral rights. YOU COULD HAVE ADVERSE TAX CONSEQUENCES IF WE EXTEND THE INTEREST PAYMENT PERIOD ON THE EXCHANGE DEBENTURES. If we extend the interest payment period on the exchange debentures, you will be required to accrue interest income as original issue discount in respect of the deferred distributions on your exchange capital securities. As a result, for United States federal income tax purposes, you will be required to include that original issue discount in gross income before you receive the deferred distributions, regardless of your regular method of tax accounting. If you sell your exchange capital securities before the record date for the payment of deferred distributions at the end of an extension period, you will not receive those distributions. Instead, the deferred and any accumulated distributions will be paid to the holder of record on the record date, regardless of who the holder of record may have been on any other date during the extension period. Moreover, accrued original issue discount will be added to your adjusted tax basis in the exchange capital securities but may not be reflected in the amount you realize on the sale. To the extent the amount realized is less than your adjusted tax basis, you will recognize a capital loss for United States federal income tax purposes. The deductibility of capital losses is subject to limitations. WE CAN REDEEM THE EXCHANGE DEBENTURES IF WE SUFFER ADVERSE TAX CONSEQUENCES OR IF THE STATUS OF THE TRUST UNDER THE INVESTMENT COMPANY ACT CHANGES, WHICH COULD SUBJECT YOU TO TAX. If a tax event or an investment company event as described in this prospectus occurs, we have the right to prepay the exchange debentures in whole (but not in part) within 90 days, which would cause a mandatory redemption of all exchange capital securities at the redemption price described under "Description of exchange Capital Securities--Redemption of exchange Capital 8 Securities" in this prospectus. The redemption of the exchange capital securities under any circumstances would be a taxable event to you for United States federal income tax purposes. WE CAN DISSOLVE THE TRUST AND DISTRIBUTE THE EXCHANGE DEBENTURES TO YOU. We have the right to dissolve the trust at any time and, after satisfaction of liabilities to creditors as required by applicable law, cause the exchange debentures to be distributed to the holders of the exchange capital securities in liquidation of the trust. The exercise of such right is subject to our receipt of an opinion of nationally recognized independent tax counsel to the effect that such distribution will not constitute a taxable exchange of the exchange capital securities for United States federal income tax purposes. THERE IS NO CERTAINTY WITH RESPECT TO THE MARKET PRICES OF THE CAPITAL SECURITIES OR THE EXCHANGE DEBENTURES. There can be no assurance as to the market prices for the capital securities or the exchange debentures that may be distributed in exchange for capital securities if a liquidation of the trust occurs. Accordingly, the exchange capital securities that an investor may purchase whether pursuant to this offering or in the secondary market, or the exchange debentures that a holder of exchange capital securities may receive in liquidation of the trust, may trade at a discount from the price that the investor paid to purchase the exchange capital securities. Because holders of capital securities may receive exchange debentures on termination of the trust and because distributions are otherwise limited to payments on the exchange debentures, prospective purchasers of exchange capital securities are also making an investment decision with regard to the exchange debentures and should carefully review all the information regarding the exchange debentures contained in this prospectus. YOU WILL ONLY HAVE LIMITED VOTING RIGHTS. Holders of exchange capital securities will generally have limited voting rights relating only to the modification of the exchange capital securities and the exercise of the trust's rights as holder of exchange debentures. Holders of exchange capital securities will have limited authority to vote to remove or replace the trustees under the trust agreement. We, the property trustee, the Delaware trustee and the administrative trustees may amend the trust agreement without the consent of holders of exchange capital securities to ensure that the trust will be classified for United States federal income tax purposes as a grantor trust or to ensure that the trust will not be required to register as an "investment company" under the Investment Company Act. YOUR FAILURE TO EXCHANGE OLD CAPITAL SECURITIES MAY ADVERSELY AFFECT YOUR ABILITY TO SELL SUCH SECURITIES. The old capital securities have not been registered under the Securities Act or any state securities laws and therefore may not be offered, sold or otherwise transferred except in compliance with the registration requirements of the Securities Act and any other applicable securities laws, or pursuant to an exemption from the applicable securities laws or in a transaction not subject to such laws, and in each case in compliance with certain other conditions and restrictions. Old capital securities which remain outstanding after consummation of the exchange offer will continue to bear a legend reflecting such restrictions on transfer. In addition, upon consummation of the exchange offer, holders of old capital securities which remain outstanding will not be entitled to any rights to have such old capital securities registered under the Securities Act or to any similar rights under the exchange and registration rights agreement, subject to certain limited exceptions. We and the Trust do not intend to register under the Securities Act any old capital securities which remain outstanding after consummation of the exchange offer, subject to such limited exceptions, if applicable. To the extent that old capital securities are tendered and accepted in the exchange offer, your ability to sell untendered old capital securities could be adversely affected. THERE IS NO CURRENT ESTABLISHED TRADING MARKET FOR THE EXCHANGE CAPITAL SECURITIES AND NO ASSURANCE THAT AN ACTIVE MARKET WILL DEVELOP. There is no existing market for the exchange capital securities and there can be no assurance as to the liquidity of any market that may develop, the ability of holders to sell, or the price that can be obtained for, the exchange capital securities. Future trading prices of the exchange capital securities will depend on many factors including, among other things, prevailing 9 interest rates, our operating results and prospects and the market for similar securities. USE OF PROCEEDS We will not receive any proceeds from the issuance of the exchange capital securities in exchange for the old capital securities tendered pursuant to the exchange offer. In consideration for the issuance of the exchange capital securities as contemplated by this prospectus, we will receive in exchange an identical aggregate liquidation amount of outstanding old capital securities, which have terms substantially identical to the exchange capital securities. We will retire and cancel all of the outstanding old capital securities surrendered in exchange for the exchange capital securities, and such outstanding old capital securities may not be reissued. THE EXCHANGE OFFER PURPOSE AND EFFECT OF THE EXCHANGE OFFER; TERMS OF THE EXCHANGE OFFER We issued and sold the old capital securities on August 31, 2001 to an initial purchaser in a private transaction not subject to the registration requirements of the Securities Act. The initial purchaser then offered and sold the old capital securities only o to "Qualified Institutional Buyers" (as defined in Rule 144A under the Securities Act) in reliance on the exemption from the registration requirements of the Securities Act provided by Rule 144A, o to a limited number of institutional "Accredited Investors" (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act) that, prior to their purchase of old capital securities, executed and delivered to the initial purchaser a letter containing certain representations and agreements and o outside the United States to non-U.S. persons in offshore transactions (as defined in Regulation S under the Securities Act) in compliance with Regulation S under the Securities Act. In connection with the sale of the old capital securities, we entered into an exchange and registration rights agreement with the initial purchaser which obligated us to: o file a registration statement with the Commission for an offer to exchange the old capital securities for the exchange capital securities within 120 days after the issuance of the old capital securities; o use our reasonable best efforts to cause the registration statement to be declared effective within 180 days after the issuance of the old capital securities; o promptly after the registration statement has been declared effective, offer exchange capital securities in exchange for surrender of the old capital securities; and o use our reasonable best efforts to keep the exchange offer open for at least 30 days after the date notice of the exchange offer has been mailed to the holders of the old capital securities. The exchange capital securities have terms identical to the old capital securities, except that the exchange capital securities do not have transfer restrictions or any terms relating to registration rights and do not provide for the liquidated damages set forth in the exchange and registration rights agreement payable by us in the event that we are unable to fulfill certain of our obligations under the exchange and registration rights agreement. A holder that tenders old capital securities pursuant to the exchange offer and does not withdraw it will receive exchange capital securities having an identical liquidation amount to the old capital securities tendered. 10 Under the exchange offer, we will exchange as soon as practicable after the date of this prospectus our $309,300,000 aggregate principal amount of old debentures for a like aggregate principal amount exchange debentures. We refer to the old debentures and the exchange debentures collectively as the junior subordinated debentures. We are also exchanging our guarantee, also referred to as the exchange guarantee, of payments of cash distributions and payments in liquidation of the trust or redemption of the exchange capital securities for the existing guarantee, also referred to as the old guarantee, in respect of the old capital securities. We refer to the old guarantee and the exchange guarantee collectively as the guarantees. PROCEDURES FOR TENDERING OLD CAPITAL SECURITIES The tender to us of old capital securities by a holder as set forth below and the acceptance of the old capital securities by us will constitute a binding agreement between the tendering holder and us upon the terms and subject to the conditions set forth in this prospectus and in the accompanying letter of transmittal. Except as set forth below, a holder who wishes to tender old capital securities for exchange pursuant to the exchange offer must transmit a properly completed and duly executed letter of transmittal, including all other documents required by such letter of transmittal, to Bank One Trust Company, National Association, who is acting as our exchange agent, at the address set forth below under "Exchange Agent" on or prior to the expiration date. In addition, on or prior to the expiration date, o certificates for such old capital securities must be received by the exchange agent; or o a timely confirmation of a book-entry transfer of these old capital securities, if this procedure is available, into the exchange agent's account at DTC pursuant to the procedure for book-entry transfer described below, must be received by the exchange agent; or o the holder must comply with the guaranteed delivery procedures described below. The method of delivery of old capital securities, letters of transmittal and all other required documents is at the election and risk of the holders. If such delivery is by mail, we recommend that you use registered mail, properly insured, with return receipt requested. In all cases, sufficient time should be allowed to assure timely delivery. No letters of transmittal or old capital securities should be sent to DPL. Signatures on a letter of transmittal or a notice of withdrawal, as the case may be, must be guaranteed unless the old capital securities surrendered for exchange pursuant thereto are tendered: o by a registered holder of the old capital securities who has not completed the box entitled "Special Issuance Instructions" or "Special Delivery Instructions" on the letter of transmittal; or o for the account of an eligible institution. If signatures on a letter of transmittal or a notice of withdrawal, as the case may be, are required to be guaranteed, such guarantees must be by an eligible institution, which is a firm that is a member of a registered national securities exchange or a member of the National Association of Securities Dealers, Inc., or a commercial bank or trust company having an office or correspondent in the United States. If old capital securities are registered in the name of a person other than the person signing the letter of transmittal, the old capital securities surrendered for exchange must be endorsed by, or be accompanied by a written instrument or instruments of transfer or exchange, in satisfactory form as determined by us in our sole discretion, duly executed by the registered holder with the signature thereon guaranteed by an eligible institution. All questions as to the validity, form, eligibility (including time of receipt) and acceptance of old capital securities tendered for exchange will be determined by us in our sole discretion, and our determination will be final and binding on all parties. We reserve the absolute right: 11 o to reject any and all tenders of any particular old capital securities not properly tendered or to not accept any particular old capital securities which acceptance might, in our judgment or the judgment of our counsel, be unlawful; and o to waive any defects or irregularities or conditions of the exchange offer as to any particular old capital securities either before or after the expiration date (including the right to waive the ineligibility of any holder who seeks to tender old capital securities in the exchange offer). Unless waived, any defects or irregularities in connection with the tender of old capital securities for exchange must be cured within such reasonable period of time as we determine. Neither we, the exchange agent nor any other person will be under any duty to give notification of any defect or irregularity with respect to any tender of old capital securities for exchange, nor will we or any of them incur any liability for failure to give such notification. TERMS OF THE EXCHANGE OFFER; PERIOD FOR TENDERING OLD CAPITAL SECURITIES Upon the terms and subject to the conditions set forth in this prospectus and in the accompanying letter of transmittal, we will: o accept for exchange old capital securities, which are properly tendered on or prior to the expiration date and not withdrawn as permitted below; and o use our reasonable best efforts to keep the exchange offer open for not less than 30 days, or longer if required by applicable law, after the date notice of the exchange offer is mailed to the holders of the old capital securities. The term "expiration date" means 5:00 p.m., New York City time, on _______, 200_; provided, however, that if we, in our sole discretion, have extended the period of time for which the exchange offer is open, the term "expiration date" means the latest time and date to which the exchange offer is extended. As of the date of this prospectus, $300,000,000 in aggregate liquidation amount of the old capital securities were outstanding. The exchange offer is not conditioned upon any minimum principal amount of old capital securities being tendered. This prospectus, together with the letter of transmittal, is first being sent on or about the date set forth on the cover page to all holders of old capital securities at the addresses set forth in the security register maintained by the trustee. We expressly reserve the right: o at any time or from time to time, to extend the period of time during which the exchange offer is open, and thereby delay acceptance of any old capital securities; and o to amend or terminate the exchange offer, and not to accept for exchange any old capital securities not previously accepted for exchange, upon the occurrence of any of the conditions of the exchange offer specified below under "Certain Conditions to the Exchange Offer." We will give written notice of any extension, amendment, non-acceptance or termination to the holders of the old capital securities as promptly as practicable, such notice in the case of any extension to be issued by means of a press release or other public announcement no later than 5:00 p.m., New York City time, on the previous expiration date. Without limiting the manner in which we may choose to make any public announcement and subject to applicable law, we shall have no obligation to publish, advertise or otherwise communicate any such public announcement other than by issuing a release to the Dow Jones News Service. Old capital securities that are not tendered for exchange or are tendered but not accepted in connection with the exchange offer will remain outstanding and be entitled to the benefits of the indenture, but will not be entitled to any further registration rights under the exchange and registration rights agreement, except under limited circumstances. We intend to conduct the 12 exchange offer in accordance with the applicable requirements of the Exchange Act and the relevant rules and regulations of the SEC. If the letter of transmittal is signed by a person or persons other than the registered holder or holders of old capital securities, such old capital securities must be endorsed or accompanied by appropriate powers of attorney, in either case signed exactly as the name or names of the registered holder or holders that appear on the old capital securities. By executing, or otherwise becoming bound by, a letter of transmittal, each holder of the old capital securities, other than certain specified holders, will represent that: o it is not our affiliate; o any exchange capital securities to be received by it were acquired in the ordinary course of its business; and o it has no arrangement with any person to participate in the distribution, within the meaning of the Securities Act, of the exchange capital securities. If the tendering holder is a broker-dealer that will receive exchange capital securities for its own account in exchange for the old capital securities that were acquired as a result of market-making activities or other trading activities, it will be required to acknowledge that it will deliver a prospectus in connection with any resale of such exchange capital securities. See "--Resale of the Exchange Capital Securities." ACCEPTANCE OF OLD CAPITAL SECURITIES FOR EXCHANGE; DELIVERY OF EXCHANGE CAPITAL SECURITIES Upon satisfaction or waiver of all of the conditions to the exchange offer, we will accept, promptly after the expiration date, all old capital securities properly tendered and will issue exchange capital securities promptly after acceptance of the old capital securities. See "Certain Conditions to the Exchange Offer" below. For purposes of the exchange offer, we will be deemed to have accepted properly tendered old capital securities for exchange if and when we have given oral (confirmed in writing) or written notice thereof to the exchange agent. In all cases, issuance of exchange capital securities for the old capital securities that are accepted for exchange pursuant to the exchange offer will be made only after timely receipt by the exchange agent of certificates for such old capital securities or a timely book-entry confirmation of such old capital securities into the exchange agent's account at DTC pursuant to the book-entry transfer procedures described below, a properly completed and duly executed letter of transmittal and all other required documents. If any tendered old capital securities are not accepted for any reason set forth in the terms and conditions of the exchange offer or if certificates representing old capital securities are submitted for a greater principal amount than the holder desires to exchange, such unaccepted or non-exchanged old capital securities will be returned without expense to the tendering holder thereof (or, in the case of old capital securities tendered by book-entry transfer into the exchange agent's account at DTC pursuant to the book-entry transfer procedures described below, such non-exchanged old capital securities will be credited to an account maintained with DTC) as promptly as practicable after the expiration or termination of the exchange offer. BOOK-ENTRY TRANSFER Promptly after the date of this prospectus, the exchange agent will make a request to establish an account with respect to the old capital securities at DTC for purposes of the exchange offer. Any financial institution that is a participant in DTC's systems may make book-entry delivery of old capital securities by causing DTC to transfer such old capital securities into the exchange agent's account in accordance with DTC's Automated Tender Offer Program ("ATOP"), procedures for transfer. However, the exchange for the old capital securities so tendered will only be made after timely confirmation of such book-entry transfer of old capital securities into the exchange agent's account, and timely receipt by the exchange agent of an agent's message and any other documents required by the letter of transmittal. The term "agent's message" means a message, transmitted by DTC and received by the exchange agent and forming a part of a book-entry confirmation, which states that DTC has received an express acknowledgment from a participant tendering old capital 13 securities that are the subject of such book-entry confirmation, that such participant has received and agrees to be bound by the terms of the letter of transmittal, and that we may enforce such agreement against such participant. Although delivery of old capital securities may be effected through book-entry transfer into the exchange agent's account at DTC, the letter of transmittal (or facsimile thereof), properly completed and duly executed, with any required signature guarantees and any other required documents, must in any case be delivered to and received by the exchange agent at its address set forth under "--Exchange Agent" on or prior to the expiration date, or the guaranteed delivery procedure set forth below must be complied with. Delivery of documents to DTC in accordance with its procedures does not constitute delivery to the exchange agent. GUARANTEED DELIVERY PROCEDURES If a registered holder of the old capital securities desires to tender such old capital securities and (1) the old capital securities are not immediately available, (2) time will not permit such holder's old capital securities or other required documents to reach the exchange agent before the expiration date of the exchange offer, or (3) the procedure for book-entry transfer cannot be completed on a timely basis, a tender may be effected if: o the tender is made through an eligible institution; o prior to the expiration date of the exchange offer, the exchange agent receives from such eligible institution a properly completed and duly executed letter of transmittal (or a facsimile letter of transmittal) and notice of guaranteed delivery, substantially in the form provided by us (by telegram, telex, facsimile transmission, mail or hand delivery), setting forth the name and address of the holder of old capital securities and the amount of old capital securities tendered, stating that the tender is being made thereby and guaranteeing that within five New York Stock Exchange trading days after the date of execution of the notice of guaranteed delivery, the certificates of all physically tendered old capital securities, in proper form for transfer, or a book-entry confirmation, as the case may be, and any other documents required by the letter of transmittal will be deposited by the eligible institution with the exchange agent; and o the certificates for all physically tendered old capital securities, in proper form for transfer, or a book-entry confirmation, as the case may be, and all other documents required by the letter of transmittal, are received by the exchange agent within five New York Stock Exchange trading days after the date of execution of the notice of guaranteed delivery. WITHDRAWAL RIGHTS Tenders of old capital securities may be withdrawn at any time prior to the expiration date. For a withdrawal to be effective, a written notice of withdrawal must be received by the exchange agent at one of the addresses set forth below under "Exchange Agent." Any such notice of withdrawal must specify: o the name of the person having tendered the old capital securities to be withdrawn; o the old capital securities to be withdrawn (including the principal amount of such old capital securities); and o where certificates for old capital securities have been transmitted, the name in which such old capital securities are registered, if different from that of the withdrawing holder. If certificates for old capital securities have been delivered or otherwise identified to the exchange agent, then, prior to the release of such certificates, the withdrawing holder must also submit the serial numbers of the 14 particular certificates to be withdrawn and a signed notice of withdrawal with signatures guaranteed by an eligible institution unless such holder is an eligible institution. If old capital securities have been tendered pursuant to the procedure for book-entry transfer described above, any notice of withdrawal must specify the name and number of the account at DTC to be credited with the withdrawn old capital securities and otherwise comply with the procedures of such facility. All questions as to the validity, form and eligibility (including time of receipt) of such notices will be determined by us in our sole discretion, and our determination will be final and binding on all parties. Any old capital securities so withdrawn will be deemed not to have been validly tendered for exchange for purposes of the exchange offer. Any old capital securities which have been tendered for exchange but which are not exchanged for any reason will be returned to its holder without cost to such holder (or, in the case of old capital securities tendered by book-entry transfer into the exchange agent's account at DTC pursuant to the book-entry transfer procedures described above, such old capital securities will be credited to an account maintained with DTC for the old capital securities) as soon as practicable after withdrawal, rejection of tender or termination of the exchange offer. Properly withdrawn old capital securities may be re-tendered by following one of the procedures described under "Procedures for Tendering Old Capital Securities" above at any time on or prior to the expiration date. CERTAIN CONDITIONS TO THE EXCHANGE OFFER Notwithstanding any other provisions of the exchange offer, we are not required to accept for exchange, or to issue exchange capital securities in exchange for old capital securities, and we may terminate or amend the exchange offer, if at any time before the acceptance of such old capital securities for exchange or the exchange of the exchange capital securities for such old capital securities, such acceptance or issuance would violate applicable law or any interpretation of the SEC's staff. The condition in the paragraph immediately above is for our sole benefit and may be asserted by us regardless of the circumstances giving rise to such condition. Our failure at any time to exercise the foregoing rights is not to be deemed a waiver of any such right and each such right shall be deemed an ongoing right which may be asserted at any time and from time to time. In addition, we will not accept for exchange any old capital securities tendered, and no exchange capital securities will be issued in exchange for any such old capital securities, if at such time any stop order is threatened or in effect with respect to the registration statement of which this prospectus constitutes a part or the qualification of the indenture under the Trust Indenture Act. EXCHANGE AGENT Bank One Trust Company, National Association has been appointed as the exchange agent for the exchange offer. All executed letters of transmittal should be directed to the exchange agent at one of the addresses set forth below. Questions and requests for assistance, requests for additional copies of this prospectus or of the letter of transmittal and requests for notices of guaranteed delivery should be directed to the exchange agent, addressed as follows: Deliver To: Bank One Trust Company, National Association, Exchange Agent By Registered or Certified Mail: 1 North State Street 9th Floor Chicago, IL 60602 Attention: Exchanges 15 By Facsimile: 312-407-8853 To Confirm by Telephone or for Information: (800) 524-9472 Delivery to an address other than as set forth above or transmission of instructions via facsimile other than as set forth above does not constitute a valid delivery. FEES AND EXPENSES The principal solicitation is being made by mail; however, additional solicitation may be made by telegraph, telecopy, telephone or in person by our officers, regular employees, affiliates and agents. We will not pay any additional compensation to any such officers and employees who engage in soliciting tenders. We will not make any payment to brokers, dealers, or others soliciting acceptances of the exchange offer. However, we will pay the exchange agent reasonable and customary fees for its services and will reimburse it for its reasonable out-of-pocket expenses in connection therewith. The estimated cash expenses to be incurred in connection with the exchange offer will be paid by us and are estimated in the aggregate to be $200,000. ACCOUNTING TREATMENT The exchange capital securities will be recorded at the same carrying value as the old capital securities. Accordingly, DPL will not recognize any gain or loss for accounting purposes. DPL intends to amortize the expenses of the exchange offer and issuance of the old capital securities over the term of the exchange capital securities. RESALE OF THE EXCHANGE CAPITAL SECURITIES Based on an interpretation by the SEC's staff contained in several no-action letters issued to third parties, we believe that the exchange capital securities issued pursuant to the exchange offer may be offered for resale, resold and otherwise transferred after the exchange offer by any holder of exchange capital securities (other than a holder which is our "affiliate" within the meaning of Rule 405 under the Securities Act) without compliance with the registration and prospectus delivery provisions of the Securities Act, if such holder: o acquires the exchange capital securities in the ordinary course of his or her business; and o does not intend to participate, and has no arrangement with any person to participate, in a distribution of the exchange capital securities. Any holder of the old capital securities who tenders in the exchange offer with the intention to participate, or for the purpose of participating, in a distribution of the exchange capital securities may not rely on the position of the staff of the Commission enunciated in the "Exxon Capital Holdings Corporation" or similar no-action letters (the Exxon Capital Letters) but rather must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction. In addition, any such resale transaction should be covered by an effective registration statement containing the selling security holders information required by Item 507 of Regulation S-K of the Securities Act. Each broker-dealer that receives exchange capital securities for its own account in exchange for the old capital securities, where such old capital securities were acquired by such broker-dealer as a result of market-making activities or other trading activities, may be a statutory underwriter and must acknowledge that it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of such exchange capital securities. By tendering in the exchange offer, each holder will represent to us (which representation may be contained in the Letter of Transmittal) to the effect that: 16 o it is not our affiliate; o it is not engaged in, and does not intend to engage in, and has no arrangement or understanding with any person to participate in, a distribution of the exchange capital securities to be issued in the exchange offer; and o it is acquiring the exchange capital securities in its ordinary course of business. Each holder will acknowledge and agree that any broker-dealer and any such holder using the exchange offer to participate in a distribution of the exchange capital securities acquired in the exchange offer: o could not under Commission policy as in effect on the date of the exchange and registration rights agreement rely on the position of the Commission enunciated in the Exxon Capital letters; o must comply with the registration and prospectus delivery requirements of the Securities Act in connection with a secondary resale transaction and that such secondary resale transaction must be covered by an effective registration statement containing the selling security holder information required by Item 507 of Regulation S-K if the resales are of exchange capital securities obtained by such Holder in exchange for old capital securities acquired by such Holder directly from us or our affiliate. DESCRIPTION OF EXCHANGE CAPITAL SECURITIES The trust will issue the exchange capital securities under the trust agreement. The exchange capital securities will represent undivided beneficial interests in the trust's assets and entitle the holders to a preference in certain circumstances over the common securities with respect to distributions and amounts payable on redemption or liquidation, as well as other benefits described in the trust agreement. Selected provisions of the trust agreement are summarized below. This summary is not complete. You should read that document for a better understanding of all of the provisions of the trust agreement that may be important to you. The trust agreement will be qualified under the Trust Indenture Act of 1939 upon effectiveness of the registration statement for the exchange offer of which this prospectus forms a part. GENERAL The old capital securities were initially issued in the aggregate liquidation amount of $300,000,000 (300,000 capital securities) and a like amount of exchange capital securities will be issued in exchange for such securities as described in this prospectus. Simultaneously with the issuance of the old capital securities the trust also issued certain common securities for which it received aggregate proceeds of $9,300,000. The capital securities and common securities of the trust are collectively referred to in this prospectus as the trust securities. The trust agreement permits the trust to "reopen" the offering of capital securities and common securities and issue additional capital securities and common securities without the consent of the holders of the capital securities or the common securities. We will own all of the trust's common securities, which rank equally, and will be paid pro rata, with the capital securities except as described under "Subordination of Common Securities" below. The property trustee will hold the exchange debentures in trust for the benefit of the trust and the holders of the trust securities. The old guarantee is, and the exchange guarantee will be, a full and unconditional guarantee with respect to the capital securities but does not guarantee payment of distributions or amounts payable on redemption or liquidation of the capital securities when the trust does not have sufficient available funds to pay those distributions. DISTRIBUTIONS Distributions on the exchange capital securities will: o be payable in U.S. dollars at 8 1/8% per annum of the stated liquidation amount of $1,000 per exchange capital security and distributions that are in arrears for more than one semi-annual 17 period will accrue interest at the rate per annum of 8 1/8% and interest so accrued at the end of each semi-annual period and remaining unpaid will itself bear interest, to the extent permitted by applicable law, until paid on the same basis o begin to accrue from and including the date of original issuance of the old capital securities; o be cumulative and payable semi-annually in arrears on March 1 and September 1 of each year, commencing March 1, 2002; and o be payable to the holders of the exchange capital securities on the relevant record dates, which are the immediately preceding February 15 and August 15, respectively. The term "distributions" as we use it in this prospectus includes semi-annual distributions, any interest payable on distributions as described above, special distributions or additional tax sums, in each case as described herein, unless we state otherwise. We will compute the amount of distributions payable for any period on the basis of a 360-day year of twelve 30-day months. If any date on which a distribution is payable for any exchange capital securities is not a business day, then the payment will be made on the following business day, without any interest or other payment for the delay. Each date on which distributions are otherwise payable in accordance with the foregoing is a "distribution date." A "business day" means a day other than: o a Saturday or a Sunday, o a day on which banks in New York, New York are authorized or obligated by law or executive order to remain closed, or o a day on which the principal corporate trust office of the property trustee or the indenture trustee is closed for business. So long as no event of default under the indenture has occurred and is continuing, we have the right to defer the payment of interest on the exchange debentures, from time to time, for a period not exceeding 10 consecutive semi-annual periods. During the extension period, we have the right to make partial payments of interest on any interest payment date. No extension period may extend beyond the stated maturity of the exchange debentures or any earlier redemption date. Semi-annual distributions on the exchange capital securities by the trust will be deferred during any extension period, and unpaid distributions will accumulate additional distributions at the rate of 8 1/8% per annum, compounded semi-annually from the relevant payment date. During an extension period, we may not, and may not permit any subsidiary to: o declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of our capital stock (which includes common and preferred stock); o make any payment of principal, interest or premium, if any, on or repay, repurchase or redeem any debt securities that rank equally with or junior to the exchange debentures; or o make any guarantee payments with respect to any guarantee issued by us if such guarantee ranks equally with or junior to the exchange debentures; other than (a) dividends or distributions payable in our common stock, (b) any declaration of a dividend in connection with the implementation of a stockholders' rights plan, or the issuance of capital stock under any such plan, or the redemption or repurchase of any such rights pursuant thereto, (c) payments under the exchange guarantee and (d) purchases of common stock related to the issuance of common stock or rights under any of our benefit plans for our directors, officers, employees, consultants or advisors. 18 At the end of any extension period, we may further extend the extension period, provided that such extension does not exceed 10 consecutive semi-annual periods or extend beyond the stated maturity of the exchange debentures or any earlier redemption date. At any time following the termination of an extension period and the payment of all amounts then due, we may elect to begin a new extension period, subject to the foregoing requirements. There is no limitation on the number of times that we may elect to begin an extension period. The revenue of the trust available for distribution to holders of the exchange capital securities will be limited to payments we make under the exchange debentures. If we do not make interest payments on the exchange debentures, the property trustee will not have funds available to pay distributions on the exchange capital securities. We will guarantee the trust's payment of distributions on a limited and subordinated basis, but only if and to the extent the trust has funds legally available for the payment of those distributions and cash sufficient to make those payments. See "Description of Exchange Guarantee." REDEMPTION OF EXCHANGE CAPITAL SECURITIES The trust must redeem the exchange capital securities when the exchange debentures are paid at maturity on September 1, 2031 (in which case the redemption price you receive will be equal to the liquidation amount of $1,000 per exchange capital security plus accumulated and unpaid distributions on the exchange capital security to the date of redemption) or if the exchange debentures are redeemed before they mature. We may redeem the exchange debentures before they mature (1) at any time, in whole but not in part, within 90 days after the occurrence of a special event at a redemption price equal to the Special Event Redemption Make-Whole Amount, as described below, and (2) at any time, in whole or in part, at a redemption price equal to the Optional Redemption Make-Whole Amount, as described below, plus, in each case, accrued interest, if any, to the redemption date. See "Right to Redeem Upon a Special Event" below for a description of the term "special event." Upon the repayment of the exchange debentures, whether at maturity or upon redemption, the proceeds from such repayment or redemption shall simultaneously be applied to redeem exchange capital securities having an aggregate liquidation amount equal to the aggregate principal amount of the exchange debentures so repaid or redeemed at the applicable redemption price; provided that holders of exchange capital securities shall be given not less than 30 nor more than 60 days notice of such redemption. The redemption price, other than at stated maturity of the exchange debentures, shall equal, for each exchange capital security, the applicable Make-Whole Amount for a corresponding $1,000 principal amount of exchange debentures together with accrued distributions to but excluding the redemption date. "Comparable Treasury Issue" means, with respect to any redemption date, the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the time period from the redemption date to September 1, 2031 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 time period. If no United States Treasury security has a maturity which is within a period from three months before to three months after September 1, 2031, the two most closely corresponding United States Treasury securities will be used as the Comparable Treasury Issue, and the Treasury Rate will be interpolated or extrapolated on a straight-line basis, rounding to the nearest month using such securities. "Comparable Treasury Price" means, with respect to any redemption date, (1) the average of up to five Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest Reference Treasury Dealer Quotations or (2) if the indenture trustee obtains fewer than five such Reference Treasury Dealer Quotations, the average of all such Quotations. The "Optional Redemption Make-Whole Amount" will be equal to the greater of (1) 100% of the principal amount of the exchange debentures being redeemed or (2) as determined by a Quotation Agent as of the redemption date, the sum of the present value of the scheduled payments of principal and interest on such exchange debentures from the redemption date to September 1, 2031 discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at a discount rate equal to the Treasury Rate plus 25 basis points. 19 "Quotation Agent" means Morgan Stanley & Co. Incorporated and its successors, as selected by us; provided, however, that if any of the foregoing ceases to be a primary United States Government securities dealer in New York City (a "Primary Treasury Dealer"), we will substitute therefor another Primary Treasury Dealer. "Reference Treasury Dealer" means (1) Morgan Stanley & Co. Incorporated and its successors; provided, however, that if any of the foregoing ceases to be a Primary Treasury Dealer, we will substitute therefor another Primary Treasury Dealer and (2) up to four other Primary Treasury Dealers selected by the indenture trustee after consultation with us. "Reference Treasury Dealer Quotations" means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the indenture 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 indenture trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such redemption date. The "Special Event Redemption Make-Whole Amount" will be equal to the greater of (1) 100% of the principal amount of the exchange debentures being redeemed or (2) as determined by a Quotation Agent as of the redemption date, the sum of the present value of scheduled payments of principal and interest on such exchange debentures from the redemption date to September 1, 2031, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at a discount rate equal to the Treasury Rate plus 50 basis points. "Treasury Rate" means (1) the yield, under the heading which represents the average for the immediately prior week, appearing in the most recently published statistical release designated "H.15 (519)" or any successor publication which is published weekly by the Federal Reserve and which establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption "Treasury Constant Maturities," for the maturity corresponding to the time period from the redemption date to September 1, 2031 (if no maturity is within three months before or after such time period, yields for the two published maturities most closely corresponding to such time period will be determined and the Treasury Rate shall be interpolated or extrapolated from such yields on a straight-line basis, rounding to the nearest month) or (2) 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 semi-annual 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. The Treasury Rate will be calculated on the third business day preceding the redemption date. RIGHT TO REDEEM UPON A SPECIAL EVENT We will have the right to redeem all, but not fewer than all, of the exchange debentures, at the Special Event Redemption Make-Whole Amount, plus accrued interest, at any time within 90 days after a tax event or an investment company event (either, a special event) happens. In the event of a redemption of the exchange debentures due to the occurrence of a special event, the property trustee will use the proceeds to redeem the exchange capital securities and common securities at a redemption price equal to the Special Event Redemption Make-Whole Amount for a corresponding $1,000 principal amount of exchange debentures together with accrued distributions to but excluding the redemption date. A "tax event" means that we and the trust have received an opinion of nationally recognized independent tax counsel to the effect that, as a result of: o any amendment to, or change or announced proposed change in, the laws or regulations of the United States or any of its political subdivisions or taxing authorities, or o any official written administrative pronouncement, action or judicial decision interpreting or applying those laws or regulations, 20 which amendment or change becomes effective, or which proposed change, pronouncement, action or decision is announced, on or after the date the capital securities are issued and sold, there is more than an insubstantial risk that: o the trust is, or within 90 days will be, subject to U.S. federal income tax with respect to income accrued or received on the exchange debentures, o interest payable to the trust on the exchange debentures is not, or within 90 days will not be, deductible, in whole or in part, by us for U.S. federal income tax purposes, or o the trust is, or within 90 days will be, subject to a material amount of other taxes, duties or other governmental charges. An "investment company event" means that we and the trust have received an opinion of nationally recognized independent counsel to the effect that, as a result of an amendment to or change in the Investment Company Act or regulations thereunder, or a written change in the interpretation or application of a law or regulation thereunder, on or after the date the old capital securities were issued and sold, there is more than an insubstantial risk that the trust is or will be considered an investment company and be required to be registered under the Investment Company Act. LIQUIDATION OF THE TRUST AND DISTRIBUTION OF EXCHANGE DEBENTURES We will have the right at any time to dissolve the trust and, after satisfaction of the liabilities of creditors of the trust as provided by applicable law, cause the exchange debentures to be distributed to the holders of the exchange capital securities. The exercise of such right is subject to receipt of an opinion of nationally recognized independent tax counsel to the effect that the distribution will not constitute a taxable exchange of the exchange capital securities for United States federal income tax purposes. After the date for any distribution of exchange debentures upon dissolution of the trust: o the exchange capital securities will no longer be deemed to be outstanding, o DTC or its nominee, as the record holder of the exchange capital securities, will receive a registered global certificate or certificates representing the exchange debentures to be delivered upon the distribution, and o any certificates representing exchange capital securities not held by DTC or its nominee will be deemed to represent a like amount of exchange debentures, with an interest rate identical to the distribution rate of, and accrued and unpaid interest equal to the accumulated and unpaid distributions on, those exchange capital securities, until the certificates are presented to us or our agent for transfer or reissuance. If a dissolution and liquidation of the trust were to occur, we could not assure you as to the market prices for the exchange debentures that may be distributed in exchange for the exchange capital securities. Accordingly, the exchange debentures that you may receive, if a dissolution and liquidation of the trust were to occur, may trade at a discount to the price that you paid to purchase the exchange capital securities. As used in this prospectus, "like amount" means: o with respect to a redemption of exchange capital securities, capital securities having a liquidation amount equal to the principal amount of exchange debentures to be contemporaneously repaid or redeemed in accordance with the indenture and the proceeds of which will be used to pay the applicable redemption price of those capital securities, and o with respect to a distribution to holders of exchange capital securities of exchange debentures in connection with the trust's liquidation, exchange debentures having a principal amount equal to the liquidation amount of the exchange capital securities of the holder to whom those exchange debentures are distributed. 21 REDEMPTION PROCEDURES Exchange capital securities redeemed on each redemption date will be redeemed at the applicable redemption price with the proceeds from the contemporaneous repayment or redemption of the exchange debentures. Redemptions of exchange capital securities will be made and the applicable redemption price will be deemed payable on each redemption date, but only to the extent that the trust has funds legally available for the payment of that redemption price. If the trust gives a notice of redemption for any exchange capital securities, then, by 12:00 noon, New York time, on the redemption date, so long as the exchange capital securities are in book-entry only form, the property trustee will: o irrevocably deposit with DTC funds sufficient to pay the applicable redemption price, and o give DTC irrevocable instructions and authority to pay the applicable redemption price to the holders of those exchange capital securities. If any exchange capital securities are held in certificated form, the trust will: o irrevocably deposit with the paying agent for those exchange capital securities funds sufficient to pay the applicable redemption price, and o give that paying agent irrevocable instructions and authority to pay the applicable redemption price to holders of those exchange capital securities upon surrender of their certificates evidencing those exchange capital securities. Distributions payable on or before the redemption date for any exchange capital securities called for redemption will be payable to the holders of those capital securities on the relevant record dates for the related distribution dates. If notice of redemption is given and funds deposited as required, then upon the redemption date: o all rights of holders of those exchange capital securities called for redemption will cease, except the right of the holders of those exchange capital securities to receive the applicable redemption price, but without interest on that redemption price, and o those exchange capital securities will cease to be outstanding. If any date fixed for redemption of exchange capital securities is not a business day, then payment of the redemption price payable on that date will be made on the next business day, without any interest or other payment in respect of the delay. If payment of the redemption price for any exchange capital securities called for redemption is improperly withheld or refused and not paid either by the trust or by us pursuant to the exchange guarantee, distributions on those exchange capital securities will continue to accrue at the then applicable distribution rate, from the original redemption date to the date of payment. In that case, the actual payment date will be considered the date fixed for redemption for purposes of calculating the applicable redemption price. Subject to applicable law, including United States federal securities law, we or our subsidiaries may from time to time purchase outstanding exchange capital securities by tender, in the open market or by private agreement. Payment of the applicable redemption price on, and any distribution of exchange debentures to holders of, the trust securities will be made to the applicable recordholders thereof as they appear on the register therefor on the relevant record date, which will be a date not more than 45 days nor less than 15 days prior to the redemption date or liquidation date, as applicable. Notice of any redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each holder of trust securities at its registered address. Unless we default in payment of the applicable 22 redemption price on, or in the repayment of, the exchange debentures, on and after the redemption date, distributions will cease to accumulate on the trust securities called for redemption. SUBORDINATION OF COMMON SECURITIES Payment of distributions on, and the redemption price of, the exchange capital securities and the common securities will be made pro rata based on the liquidation amount of those trust securities. No distribution payment or other payment on account of the redemption, liquidation or other acquisition of any common security will be made, however, if an event of default under the indenture has occurred and is continuing on the distribution, redemption or other payment date unless payment in full in cash of all accumulated and unpaid distributions on all outstanding exchange capital securities or the full redemption price due on exchange capital securities, as applicable, is made or provided for. The property trustee must first apply all available funds to payment in full in cash of all exchange capital securities distributions or redemption price then due and payable. In the case of an event of default under the trust agreement resulting from our default on the exchange debentures, the holder of common securities will be deemed to have waived the trust agreement event of default until the effect of all trust agreement events of default has been cured, waived or otherwise eliminated. Until those trust agreement events of default have been so cured, waived or otherwise eliminated, the property trustee will act solely on behalf of the holders of the exchange capital securities and any old capital securities outstanding and not the holder of the common securities, and only the holders of the capital securities will have the right to direct the property trustee to act on their behalf. LIQUIDATION DISTRIBUTION UPON DISSOLUTION Pursuant to the trust agreement, the trust will dissolve and will be liquidated by the trustees on the first to occur of: o September 1, 2032, the expiration of the term of the trust; o our bankruptcy, dissolution or liquidation; o our election to dissolve the trust and to distribute a like amount of the exchange debentures to the holders of the trust securities; o the redemption of all of the capital securities in connection with the repayment of all of the exchange debentures; and o the entry by a court of an order for judicial dissolution of the trust. If an early dissolution occurs as described in the second, third and fifth bullet points above, the trustees will expeditiously liquidate the trust by causing the property trustee to distribute to each holder of capital securities and common securities, after satisfaction of liabilities to creditors of the trust, a like amount of exchange debentures, unless that distribution is determined by the property trustee to be impractical. If that distribution is impractical, the holders will be entitled to receive out of the available assets of the trust, after satisfaction of liabilities of creditors to the trust, an amount equal to the aggregate of the stated liquidation amount per capital security plus accumulated and unpaid distributions to the date of payment. If this liquidation distribution can be paid only in part because the trust has insufficient assets to pay in full, then the amounts payable directly by the trust on the capital securities will be paid on a pro rata basis. The holders of the common securities will be entitled to receive distributions upon any dissolution pro rata with the holders of the capital securities, except the capital securities will have a preference over the common securities if a trust agreement event of default has occurred and is continuing. If there is no early dissolution of the trust, unless earlier redeemed in part, the exchange capital securities will remain outstanding until the repayment of the exchange debentures at stated maturity. 23 EVENTS OF DEFAULT; NOTICE Any one of the following events constitutes a trust agreement event of default: o the occurrence of an event of default under the indenture (see "Description of Exchange Debentures(Y)Events of Default"); or o default by the trust in the payment of any distribution for 30 days after it becomes due and payable; or o default by the trust in the payment of any redemption price of any exchange capital security or common security when it becomes due and payable; or o default in the performance, or breach, in any material respect, of any covenant or warranty of the trustees in the trust agreement, other than a default or breach referred to in the second and third bullet points above, and continuation of that default or breach for a period of 60 days after the defaulting trustee or trustees have been given written notice thereof by the holders of at least 25% in liquidation amount of the outstanding capital securities; or o the occurrence of a bankruptcy event with respect to the property trustee. Within 90 business days after the occurrence of any trust agreement event of default, the property trustee will send notice of any default actually known to it to the holders of exchange capital securities, the administrative trustees and us, as the depositor, unless the default has been cured or waived. The holder of the common securities may remove the property trustee and appoint a successor at any time unless a trust agreement event of default has occurred and is continuing, in which case the holders of a majority in liquidation amount of the capital securities may remove the property trustee and appoint a successor. No registration or removal of the property trustee and no appointment of a successor trustee will be effective until the successor property trustee accepts the appointment in accordance with the trust agreement. If an event of default under the indenture has occurred and is continuing, the capital securities will have a preference over the common securities with respect to payments of distributions or upon termination of the trust as described above. MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF THE TRUST The trust may not consolidate, amalgamate, merge with or into, or be replaced by, or convey, transfer or lease its properties and assets substantially as an entirety, to any corporation or other body except as described below or under "Liquidation Distribution upon Dissolution." The trust may, with the consent of the administrative trustees and without the consent of the holders of the trust securities, consolidate, amalgamate, merge with or into, or be replaced by a trust organized as such under the laws of any state, if it satisfies the following conditions: o the successor entity either: -- expressly assumes all of the obligations of the trust under the trust securities, or -- substitutes for the trust securities other securities having substantially the same terms as the trust securities, so long as the successor securities rank the same as the trust securities with respect to distributions and payments upon liquidation, redemption and otherwise, o we expressly acknowledge a trustee of the successor entity as possessing the same powers and duties as the property trustee, in its capacity as the holder of the exchange debentures, 24 o the exchange capital securities or any successor securities are listed or quoted, or any successor securities will be listed or quoted upon notification of issuance, on any national securities exchange or with another organization on which the exchange capital securities are then listed or quoted, o the merger, consolidation, amalgamation or replacement does not cause the capital securities, including any successor securities, to be downgraded by any nationally recognized statistical rating organization, o the merger, consolidation, amalgamation or replacement does not adversely affect the rights, preferences and privileges of the holders of the trust securities, including any successor securities, in any material respect, o the successor entity has a purpose substantially identical to that of the trust, and o prior to the merger, consolidation, amalgamation or replacement, the trust has received an opinion of nationally recognized independent counsel to the effect that: -- the merger, consolidation, amalgamation or replacement does not adversely affect the rights, preferences and privileges of the holders of the trust securities, including any successor securities, in any material respect, and -- following the merger, consolidation, amalgamation or replacement, neither the trust nor the successor entity will be required to register as an "investment company" under the Investment Company Act, and -- we guarantee the obligations of the successor entity under the successor securities at least to the extent provided by the exchange guarantee. However, the trust will not, except with the consent of holders of 100% in liquidation amount of the trust securities, consolidate, amalgamate, merge with or into, or be replaced by, or convey, transfer or lease its properties and assets substantially as an entirety to, any other person, or permit any other entity to consolidate, amalgamate, merge with or into, or replace it if the consolidation, amalgamation, merger or replacement would cause the trust or the successor entity to be classified as other than a grantor trust for United States federal income tax purposes. VOTING RIGHTS; AMENDMENT OF THE TRUST AGREEMENT Except as provided below and under "Description of Guarantee-Amendments and Assignment" and as otherwise required by law and the trust agreement, the holders of the exchange capital securities will have no voting rights. We, the property trustee, the Delaware trustee or the administrative trustees may amend the trust agreement from time to time, without the consent of the holders of the trust securities, in order to: o cure any ambiguity to correct or supplement any inconsistent provisions in the trust agreement; o modify, eliminate or add to any provisions of the trust agreement to ensure that the trust will be classified for United States federal income tax purposes as a grantor trust at all times that any trust securities are outstanding or to ensure that the trust will not be required to register as an "investment company" under the Investment Company Act; or o provide the property trustee with the authority to execute on behalf of the administrative trustees capital securities certificates in certificated, fully registered form, provided, however, that, in the case of the first bullet, any such action shall not adversely affect in any material respect the interests of any holder of trust securities or the property trustee or the Delaware trustee, and that any 25 amendments of the trust agreement shall become effective when notice thereof is given to the holders of the trust securities. The trust agreement may be amended by us and by the trustees under the trust agreement with: o the consent of holders representing not less than a majority (based upon liquidation amounts) of the outstanding trust securities; and o receipt by the trustees of an opinion of nationally recognized independent counsel to the effect that such amendment or the exercise of any power granted to the trustees in accordance with such amendment will not affect the trust's status as a grantor trust for United States federal income tax purposes or the trust's exemption from status as an "investment company" under the Investment Company Act. The trust agreement may not be amended without the consent of each holder of trust securities to: o change the amount or timing of any distribution on the trust securities or otherwise adversely affect the amount of any distribution required to be made in respect of the trust securities as of a specified date; or o restrict the right of a holder of trust securities to institute suit for the enforcement of any such payment on or after such date. So long as any exchange debentures are held by the property trustee, the trustees under the trust agreement shall not: o direct the time, method and place of conducting any proceeding for any remedy available to the indenture trustee or executing any trust or power conferred on the indenture trustee with respect to the exchange debentures; o waive any past default that is waivable under the indenture; o exercise any right to rescind or annul a declaration that the principal of all the exchange debentures is due and payable; or o consent to any amendment, modification or termination of the indenture or the exchange debentures, where the consent of the holders of the junior subordinated debentures shall be required, without, in each case, obtaining the prior approval of the holders of at least a majority in liquidation amount of all outstanding capital securities; provided, however, that where a consent under the indenture would require the consent of each holder of exchange debentures affected thereby, no such consent shall be given by the property trustee without the prior written consent of each holder of the capital securities. The trustees under the trust agreement shall not revoke any action previously authorized or approved by a vote of the holders of the capital securities, except by a subsequent vote of such holders. The property trustee shall notify each holder of capital securities of any notice of default with respect to the exchange debentures unless such default has been cured or waived. In addition to obtaining the foregoing approvals of such holders of the exchange capital securities, prior to taking any of the foregoing actions, the trustees under the trust agreement shall obtain an opinion of nationally recognized independent counsel to the effect that such action will not cause the trust to fail or cease to be classified as a grantor trust for United States federal income tax purposes. Any required approval of holders of trust securities may be given at a meeting of such holders convened for such purpose. Any action that may be taken by holders of trust securities at a meeting may be taken without a meeting if holders of trust securities holding a majority of outstanding trust securities (based upon their liquidation amount) consent to the action in writing. The property trustee will cause a notice of any meeting at which holders of trust 26 securities are entitled to vote, or of any matter upon which action by written consent of such holders is to be taken, to be given to each holder of record of trust securities in the manner set forth in the trust agreement. No vote or consent of the holders of exchange capital securities is required for the trust to redeem and cancel the exchange capital securities in accordance with the trust agreement. Notwithstanding that holders of the exchange capital securities are entitled to vote or consent under any of the circumstances described above, any of the exchange capital securities that are owned by us or our affiliates, or the trustees under the trust agreement or their affiliates, will, for all purposes of such vote or consent, be treated as if they were not outstanding. FORM, DENOMINATION, BOOK-ENTRY PROCEDURES AND TRANSFER The exchange capital securities initially will be represented by one or more capital securities in registered, global form (collectively, the global capital securities"). Upon issuance, the global capital securities will be deposited with the property trustee as custodian for The Depository Trust Company ("DTC"), in New York, New York, and registered in the name of DTC or its nominee, in each case for credit to an account of a direct or indirect participant in DTC as described below. Except as set forth below, the global capital securities may be transferred, in whole and not in part, only to another nominee of DTC or to a successor of DTC or its nominee. Beneficial interests in the global capital securities may not be exchanged for exchange capital securities in certificated form except in the limited circumstances described below. See "--Exchange of Book-Entry Exchange Capital Securities for Certificated Exchange Capital Securities." Except in the limited circumstances described below, owners of beneficial interests in the global capital securities will not be entitled to receive physical delivery of capital securities in certificated form. In addition, transfers of beneficial interests in the global capital securities will be subject to the applicable rules and procedures of DTC and its direct or indirect participants (including, if applicable, those of the Euroclear System ("Euroclear") and Clearstream Banking ("Clearstream")), which may change from time to time. Depositary Procedures DTC has advised the trust and us that DTC is a limited-purpose trust company created to hold securities for its participating organizations (collectively, the "participants") and to facilitate the clearance and settlement of transactions in those securities between participants through electronic book-entry changes in accounts of its participants. The participants include securities brokers and dealers (including the initial purchaser), banks, trust companies, clearing corporations and certain other organizations. Access to DTC's system is also available to other entities such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a participant, either directly or indirectly (collectively, the "indirect participants"). Persons who are not participants may beneficially own securities held by or on behalf of DTC only through the participants or the indirect participants. The ownership interest and transfer of ownership interest of each actual purchaser of each security held by or on behalf of DTC are recorded on the records of the participants and indirect participants. DTC has also advised the trust and us that, pursuant to procedures established by it, (i) upon deposit of the global capital securities, DTC will credit the accounts of participants designated by the initial purchaser with portions of the liquidation amount of the global capital securities and (ii) ownership of such interests in the global capital securities will be shown on, and the transfer of ownership thereof will be effected only through, records maintained by DTC (with respect to the participants) or by the participants and the indirect participants (with respect to other owners of beneficial interests in the global capital securities). Investors in the global capital securities may hold their interests therein directly through DTC if they are participants in such system, or indirectly through organizations which are participants in such system. The laws of some states require that certain persons take physical delivery in certificated form of securities that they own. Consequently, the ability to transfer beneficial interests in a global capital security to such persons will be limited to that extent. Because DTC can act only on behalf of participants, which in turn act on behalf of indirect participants and certain banks, the ability of a person having beneficial interests in a global capital security to pledge such interests to persons or entities that do not participate in the DTC 27 system, or otherwise take actions in respect of such interests, may be affected by the lack of a physical certificate evidencing such interests. EXCEPT AS DESCRIBED BELOW, OWNERS OF INTERESTS IN THE GLOBAL CAPITAL SECURITIES WILL NOT HAVE CAPITAL SECURITIES REGISTERED IN THEIR NAME, WILL NOT RECEIVE PHYSICAL DELIVERY OF EXCHANGE CAPITAL SECURITIES IN CERTIFICATED FORM AND WILL NOT BE CONSIDERED THE REGISTERED OWNERS OR HOLDERS THEREOF UNDER THE TRUST AGREEMENT FOR ANY PURPOSE. Payments in respect of the global capital security registered in the name of DTC or its nominee will be payable by the property trustee to DTC in its capacity as the registered holder under the trust agreement. Under the terms of the trust agreement, the property trustee will treat the persons in whose names the exchange capital securities, including the global capital securities, are registered as the owners thereof for the purpose of receiving such payments and for any and all other purposes whatsoever. Consequently, neither we, the trust nor the property trustee nor any agent thereof has or will have any responsibility or liability for (i) any aspect of DTC's records or any participant's or indirect participant's records relating to or payments made on account of beneficial ownership interests in the global capital securities, or for maintaining, supervising or reviewing any of DTC's records or any participant's or indirect participant's records relating to the beneficial ownership interests in the global capital securities or (ii) any other matter relating to the actions and practices of DTC or any of its participants or indirect participants. DTC has advised the trust and us that its current practice, upon receipt of any payment in respect of securities such as the exchange capital securities, is to credit the accounts of the relevant participants with the payment on the payment date, in amounts proportionate to their respective holdings in liquidation amount of beneficial interests in the relevant security as shown on the records of DTC unless DTC has reason to believe it will not receive payment on such payment date. Payments by the participants and the indirect participants to the beneficial owners of exchange capital securities will be governed by standing instructions and customary practices and will be the responsibility of the participants or the indirect participants and will not be the responsibility of DTC, the property trustee or the trust. Neither we, the trust nor the property trustee will be liable for any delay by DTC or any of its participants in identifying the beneficial owners of the exchange capital securities, and the trust and the property trustee may conclusively rely on and will be protected in relying on instructions from DTC or its nominee for all purposes. Except for trades involving only Euroclear and Clearstream participants, interests in the global capital securities will trade in DTC's Same-Day Funds Settlement System and secondary market trading activity in such interests will therefore settle in immediately available funds, subject in all cases to the rules and procedures of DTC and its participants. Transfers between participants in DTC will be effected in accordance with DTC's procedures, and will be settled in same-day funds. Transfers between participants in Euroclear and Clearstream will be effected in the ordinary way in accordance with their respective rules and operating procedures. Cross-market transfers between the participants in DTC, on the one hand, and Euroclear or Clearstream participants, on the other hand, will be effected through DTC in accordance with DTC's rules on behalf of Euroclear or Clearstream, as the case may be, by its respective depositary; however, such cross-market transactions will require delivery of instructions to Euroclear or Clearstream, as the case may be, by the counterparty in such system in accordance with the rules and procedures and within the established deadlines (Brussels time) of such system. Euroclear or Clearstream, as the case may be, will, if the transaction meets its settlement requirements, deliver instructions to its respective depositary to take action to effect final settlement on its behalf by delivering or receiving interests in the relevant global capital securities in DTC and making or receiving payment in accordance with normal procedures for same-day funds settlement applicable to DTC. Euroclear participants and Clearstream participants may not deliver instructions directly to the depositaries for Euroclear or Clearstream. Because of time zone differences, the securities account of a Euroclear or Clearstream participant purchasing an interest in a global capital security from a participant in DTC will be credited, and any such crediting will be reported to the relevant Euroclear or Clearstream participant, during the securities settlement processing day (which must be a business day for Euroclear and Clearstream) immediately following the DTC settlement date. Cash received in Euroclear or Clearstream as a result of sales of an interest in a global capital security by or through a Euroclear or Clearstream participant to a participant in DTC will be received with value on the DTC settlement date but will be 28 available in the relevant Euroclear or Clearstream cash account only as of the business day for Euroclear or Clearstream following DTC's settlement date. DTC has advised the trust and us that it will take any action permitted to be taken by a holder of capital securities only at the direction of one or more participants to whose account with DTC interests in the global capital securities are credited and only in respect of such portion of the aggregate liquidation amount of the capital securities as to which such participant or participants has or have given such direction. However, if there is an event of default under the trust agreement, DTC reserves the right to exchange the global capital securities for legended capital securities in certificated form and to distribute such capital securities to its participants. The information in this section concerning DTC, Euroclear and Clearstream and their book-entry systems has been obtained from sources that we and the trust believe to be reliable, but neither we nor the trust take responsibility for the accuracy thereof. Although DTC, Euroclear and Clearstream have agreed to the foregoing procedures to facilitate transfers of interests in the global capital securities among participants in DTC, Euroclear and Clearstream, no depositary is under any obligation to perform or to continue to perform such procedures, and such procedures may be discontinued at any time. Neither we, the trust nor the property trustee will have any responsibility for the performance by DTC, Euroclear or Clearstream or their respective participants or indirect participants of their respective obligations under the rules and procedures governing their operations. Exchange of Book-Entry Exchange Capital Securities for Exchange Certificated Capital Securities A global capital security is exchangeable for exchange capital securities in registered certificated form if (1) DTC (a) notifies us and the property trustee that it is unwilling or unable to continue as depositary for the global capital security or (b) has ceased to be a clearing agency registered under the Exchange Act and we fail to appoint a successor depositary within 90 days, (2) we, in our sole discretion, elect to cause the issuance of the exchange capital securities in certificated form or (3) there has occurred and is continuing an event of default or any event which after notice or lapse of time or both would be an event of default under the trust agreement. In all cases, certificated exchange capital securities delivered in exchange for any global capital security or beneficial interests therein will be registered in the names, and issued in any approved denominations, requested by or on behalf of the depositary (in accordance with its customary procedures). PAYMENT AND PAYING AGENTS Payments in respect of the exchange capital securities held in global form will be made to DTC, which will credit the relevant accounts at DTC on the applicable distribution dates or in respect of the exchange capital securities that are not held by DTC, such payments will be made by check mailed to the address of the holder entitled thereto as such address appears on the register. The paying agent will initially be The Bank of New York and any co-paying agent chosen by The Bank of New York and acceptable to the administrative trustees and us. The paying agent will be permitted to resign as paying agent upon 30 days' written notice to the administrative trustees, the property trustee and us. In the event that the property trustee is no longer the paying agent, the administrative trustees will appoint a successor (which will be a bank or trust company acceptable to the administrative trustees and us) to act as paying agent. REGISTRAR AND TRANSFER AGENT The property trustee will act as registrar and transfer agent for the exchange capital securities. Registration of transfers of the exchange capital securities may be effected without charge by or on behalf of the trust, but the registrar may require payment of a sum sufficient to cover any tax or governmental charge that may be imposed in connection with any transfer or exchange. The trust will not be required to register or cause to be registered the transfer of the exchange capital securities after they have been called for redemption. 29 INFORMATION CONCERNING THE PROPERTY TRUSTEE The property trustee, other than during the occurrence and continuance of an event of default under the trust agreement, undertakes to perform only such duties as are specifically set forth in the trust agreement and, after such event of default, must exercise the same degree of care and skill as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this provision, the property trustee is under no obligation to exercise any of the powers vested in it by the trust agreement at the request of any holder of trust securities unless it is offered reasonable indemnity against the costs, expenses and liabilities that might be incurred thereby. If no event of default under the trust agreement has occurred and is continuing, and the property trustee is required to decide between alternative causes of action, construe ambiguous or inconsistent provisions in the trust agreement or is unsure of the application of any provision of the trust agreement, and the matter is not one on which holders of the capital securities are entitled under the trust agreement to vote, then the property trustee will take such action as is directed by us and if not so directed, will take such action as it deems advisable and in the best interests of the holders of the trust securities, and will have no liability except for its own bad faith, negligence or willful misconduct. MISCELLANEOUS The administrative trustees are authorized and directed to conduct the affairs of and to operate the trust in such a way that the trust will not be deemed to be an "investment company" required to be registered under the Investment Company Act or classified as other than a grantor trust for United States federal income tax purposes and so that the junior subordinated debentures will be treated as our indebtedness for United States federal income tax purposes. In this regard, we and the administrative trustees are authorized to take any action, not inconsistent with applicable law, the certificate of trust of the trust or the trust agreement, that we and the administrative trustees determine in our discretion to be necessary or desirable for such purposes, as long as such action does not materially adversely affect the interests of the holders of the trust securities. Holders of the trust securities have no preemptive or similar rights. The trust may not borrow money or issue debt or mortgage or pledge any of its assets. DESCRIPTION OF EXCHANGE DEBENTURES The trust invested the proceeds from the sale of the old capital securities and the common securities in the old debentures. Under the exchange offer, we will exchange as soon as practicable after the date of this prospectus the exchange debentures for the old debentures. The exchange debentures will have terms identical in all material respects to the old debentures, except that exchange debentures will not contain terms with respect to transfer restrictions under the Securities Act and will not provide for liquidated damages. Selected provisions of the exchange debentures and the indenture are summarized below. This summary is not complete. You should read those documents for a better understanding of all of their provisions that may be important to you. The indenture will be qualified under the Trust Indenture Act of 1939, upon effectiveness of a registration statement for the exchange offer of which this prospectus forms a part. GENERAL The old debentures and the exchange debentures are each a series of debt securities under the indenture. The indenture provides for the issuance by us of subordinated debt securities in series from time to time in an unlimited amount. The indenture permits us to "reopen" each of these series of junior subordinated debentures and issue additional junior subordinated debentures of each series without the consent of the holders of junior subordinated debentures. The exchange debentures will be issued in minimum denominations of $1,000 and integral multiples of $1,000 in excess thereof. The exchange debentures will mature on September 1, 2031. The exchange debentures will bear interest at the annual rate of 8 1/8% payable semi-annually in arrears on March 1 and September 1 of each year, commencing March 1, 2002. 30 Payment will be made to the registered holder, subject to certain exceptions, at the close of business on the business day next preceding such interest payment date. We anticipate that until any liquidation of the trust, each exchange debenture will be held in the name of the property trustee in trust for the benefit of the holders of the trust securities. The amount of interest payable for any period will be computed on the basis of a 360-day year of twelve 30-day months. If any date on which interest is payable on the exchange debentures is not a business day, then the payment will be made on the following business day, without any interest or other payment for the delay. Accrued interest that is otherwise not paid on the applicable interest payment date will bear additional interest (to the extent permitted by applicable law) at the rate per annum of 8 1/8%, compounded semi-annually. The term "interest" as we use it in this prospectus includes semi-annual interest payments, additional interest, additional tax sums and special interest, in each case as described herein, unless we state otherwise. The exchange debentures are unsecured and rank junior and subordinate in right of payment to all of our senior indebtedness. Since we are a holding company, our right to participate in any distribution of assets of any subsidiary upon its liquidation or reorganization or otherwise (and thus the ability of holders of exchange debentures and exchange capital securities to benefit indirectly from such distribution) is subject to the prior claims of creditors of that subsidiary, except to the extent that we ourselves may be recognized as a creditor of that subsidiary. Claims on our subsidiaries by creditors other than us include long-term debt and certain other short-term borrowings. Accordingly, the exchange debentures will be subordinated to all of our senior indebtedness and will be effectively subordinated to all existing and future liabilities of our subsidiaries, including under any preferred stock, and holders of the exchange debentures should look only to our assets for payments thereunder. The indenture does not limit the incurrence or issuance by us or our subsidiaries of secured or unsecured debt, including senior indebtedness. DENOMINATIONS, REGISTRATION AND TRANSFER The exchange debentures will initially be represented by one certificate registered in the name of the property trustee. If distributed to holders of exchange capital securities in connection with a liquidation of the trust, the exchange debentures may be represented by one or more global certificates registered in the name of Cede & Co. as the nominee of DTC and one or more exchange debentures in certificated form. Beneficial interests in exchange debentures in global form will be shown on, and transfers thereof will be effected only through, records maintained by participants in DTC. Payments on exchange debentures represented by a global security will be made to DTC as the depositary for the exchange debentures. In the event exchange debentures are issued in certificated form, payment, transfer and exchange will occur at the corporate office of the indenture trustee in New York, New York, or at the offices of any paying agent or transfer agent appointed by us. In addition, if the exchange debentures are registered to a holder other than the property trustee or a nominee of DTC, the record dates will be the February 15 and August 15, respectively, immediately preceding the related interest payment date. For a description of DTC and the terms of the depositary arrangements relating to payments, transfers, voting rights, redemptions and other notices and other matters, see "Description of Capital Securities--Form, Denomination, Book-Entry Procedures and Transfer." If the exchange debentures are distributed to the holders of the trust securities upon the termination of the trust, they will have substantially the same form, denomination, book-entry and transfer procedures as described under "Description of Capital Securities--Form, Denomination, Book-Entry Procedures and Transfer." PAYMENT AND PAYING AGENTS Payment of principal of (and premium, if any) and any interest on exchange debentures will be made at the office of The Bank of New York in The City of New York or at the office of such paying agent or paying agents as we may designate from time to time, except that at our option payment of any interest may be made, except in the case of junior subordinated debentures in global form, (i) by check mailed to the address of the person entitled thereto as such address appears in the register for junior subordinated debentures or (ii) by transfer to an account maintained by the person entitled thereto as specified in such register, provided that proper transfer instructions have been received by the relevant record date. Payment of any interest on any junior subordinated debenture will be made to the person in whose name such junior 31 subordinated debenture is registered at the close of business on the record date for such interest, except in the case of a call for redemption after a record date and prior to such interest payment date and defaulted interest, which will be paid as described in the indenture. We may at any time designate additional paying agents or rescind the designation of any paying agent; however, we will at all times be required to maintain a paying agent in each place of payment for the junior subordinated debentures. Any moneys deposited with The Bank of New York or any paying agent, or then held by us in trust, for the payment of the principal of (and premium, if any) or interest on any exchange debenture and remaining unclaimed for two years after such principal (and premium, if any) or interest has become due and payable may, at our request, be repaid to us and the holder of such exchange debenture must thereafter look, as a general unsecured creditor, only to us for payment thereof. OPTION TO DEFER INTEREST PAYMENTS So long as no event of default under the indenture has occurred and is continuing, we have the right to defer the payment of interest on the exchange debentures, from time to time, for a period not exceeding 10 consecutive semi-annual periods. During the extension period, we have the right to make partial payments of interest on any interest payment date. No extension period may extend beyond the stated maturity of the exchange debentures or any earlier redemption date. Semi-annual distributions on the exchange capital securities by the trust will be deferred during any extension period, and unpaid distributions will accumulate additional distributions at the rate of 8 1/8% per annum, compounded semi-annually from the relevant payment date. During an extension period, we may not, and may not permit any subsidiary to: o declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of our capital stock (which includes common and preferred stock); o make any payment of principal, interest or premium, if any, on or repay, repurchase or redeem any debt securities that rank equally with or junior to the exchange debentures; or o make any guarantee payments with respect to any guarantee issued by us if such guarantee ranks equally with or junior to the exchange debentures, other than (a) dividends or distributions payable in our common stock, (b) any declaration of a dividend in connection with the implementation of a stockholders' rights plan, or the issuance of capital stock under any such plan, or the redemption or repurchase of any such rights pursuant thereto, (c) payments under the exchange guarantee and (d) purchases of our common stock related to the issuance of common stock or rights under any of our benefit plans for our directors, officers, employees, consultants or advisors. At the end of any extension period, we may further extend the extension period, provided that such extension does not exceed 10 consecutive semi-annual periods or extend beyond the stated maturity of the exchange debentures or any earlier redemption date. At any time following the termination of an extension period and the payment of all amounts then due, we may elect to begin a new extension period, subject to the foregoing requirements. There is no limitation on the number of times that we may elect to begin an extension period. REDEMPTION We may redeem the exchange debentures before they mature (1) at any time, in whole but not in part, within 90 days after the occurrence of a special event at a redemption price equal to the Special Event Redemption Make-Whole Amount and (2) at any time, in whole or in part, at a redemption price equal to the Optional Redemption Make-Whole Amount, plus, in each case, accrued interest, if any, to the redemption date. For the definitions of tax event and investment company event, see "Description of Exchange Capital Securities -- Right to Redeem Upon a Special 32 Event" in this prospectus. For the definitions of Special Event Redemption Make-Whole Amount and Optional Redemption Make-Whole Amount, see "Description of Exchange Capital Securities -- Redemption of Exchange Capital Securities" in this prospectus. Notice of any redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each holder of exchange debentures to be redeemed at its registered address. Unless we default in payment of the redemption price, on and after the redemption date, interest will cease to accrue on such exchange debentures called for redemption. RESTRICTIONS ON CERTAIN PAYMENTS We will covenant that we will not, nor will we permit any subsidiary to: o declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of our capital stock (which includes common and preferred stock); o make any payment of principal, interest or premium, if any, on or repay, repurchase or redeem any debt securities that rank equally with or junior to the exchange debentures; or o make any guarantee payments with respect to any guarantee issued by us if such guarantee ranks equally with or junior to the exchange debentures; other than (a) dividends or distributions payable in our common stock, (b) any declaration of a dividend in connection with the implementation of a stockholders' rights plan, or the issuance of capital stock under any such plan, or the redemption or repurchase of any such rights pursuant thereto, (c) payments under the exchange guarantee and (d) purchases of our common stock related to the issuance of common stock or rights under any of our benefit plans for our directors, officers, employees, consultants or advisors, if at such time o we have actual knowledge of any event that (a) with the giving of notice or the lapse of time, or both, would constitute an event of default under the indenture, and (b) we have not taken reasonable steps to cure the same; o we are in default with respect to our payment of any obligations under the exchange guarantee; or o we have given notice of our election of an extension period as provided in the indenture and have not rescinded such notice, or such extension period, or any extension thereof, is continuing. ADDITIONAL TAX SUMS As long as the trust is the holder of the exchange debentures, and the exchange capital securities remain outstanding, we shall pay to the trust "additional tax sums," which means any additional amounts that may be necessary so that the amount of distributions then due and payable by the trust will not be reduced as a result of any additional taxes, duties and other governmental charges imposed on the trust. MODIFICATION OF INDENTURE From time to time, we and the indenture trustee may, without the consent of the holders of the exchange debentures, amend, waive or supplement the indenture for specified purposes, including, among other things, curing ambiguities, defects or inconsistencies (provided that any such action does not materially adversely affect the interest of the holders of the outstanding exchange debentures or exchange capital securities) and qualifying, or maintaining the qualification of, the indenture under the Trust Indenture Act. The indenture contains a provision permitting us and the indenture trustee, with the consent of the holders of a majority in principal amount of the exchange debentures (together with any other series of debt securities under 33 the indenture voting as one class with the exchange debentures), to modify the rights of the holders of exchange debentures (and such other series), provided that no such modification may o reduce or change, without the consent of the holder of all outstanding junior subordinated debentures - the fixed maturity of the exchange debentures, or - the rate or extend the time of payment of any interest or overdue principal amount, or - the principal amount, or - the amount payable upon redemption, or - the currency of payment of principal or interest; o reduce the percentage of exchange debentures required to consent to any supplemental indenture, without the consent of the holders of all outstanding junior subordinated debentures; o modify certain provisions of the indenture relating to waiver of compliance with covenants, waiver of defaults or modification of the indenture, except to increase the percentage of holders required for such waiver or modification, without the consent of the holders of all outstanding exchange debentures; or o modify the provisions of the indenture with respect to the subordination of outstanding exchange debentures in a manner adverse to the holders without the consent of the holders of all outstanding exchange debentures. In addition, so long as any of the exchange capital securities remain outstanding, no such modification may be made that adversely affects the holders of such exchange capital securities in any material respect, and no termination of the indenture may occur, and no waiver of any event of default or compliance with any covenant under the indenture may be effective, without the prior consent of the holders of at least a majority of the aggregate liquidation amount of such exchange capital securities unless and until the principal of the underlying exchange debentures and all accrued and unpaid interest thereon have been paid in full and certain other conditions are satisfied. EVENTS OF DEFAULT An event of default with respect to any series of debt securities under the indenture, including the exchange debentures, is defined in the indenture as being: o default for 30 days in payment of any installment of interest on the debt securities of that series (subject to the deferral of any due date in the case of an extension period); o default in payment of any principal or premium, if any, on the debt securities of that series; o our failure to materially perform any of the covenants or agreements in the indenture specifically contained therein for the benefit of the debt securities of that series which have not been remedied for a period of 60 days after written notice to us by the indenture trustee or to us and the indenture trustee by the holders of not less than 25% in principal amount of the debt securities of that series and all other series so benefited (all series voting as one class); or o certain events of bankruptcy, insolvency or reorganization relating to us. If an event of default under the first three bullets above has occurred and is continuing (but, in the case of the third bullet, only if the default is with respect to less than all series of debt securities outstanding under the indenture), either the indenture trustee or the holders of not less than 25% in principal amount of all the then outstanding debt securities of the series as to which such event of default under the first three bullets has occurred (each such series voting as a separate class in the case of an event of default under 34 the first two bullets, and all such affected series voting as one class in the case of an event of default under the third bullet) may declare the principal of all the debt securities of that series, together with any accrued interest, to be immediately due and payable. If the trust does not make this declaration with respect to the exchange debentures, the holders of at least 25% in aggregate liquidation amount of the exchange capital securities will have such right. If an event of default under the third or fourth bullet above has occurred and is continuing (but, in the case of the third bullet, only if the default is with respect to all debt securities outstanding under the indenture), either the indenture trustee or the holders of not less than 25% in principal amount of all the then outstanding debt securities of each series as to which such event of default under the third or fourth bullets has occurred (voting as one class) may declare the principal of all the debt securities under the indenture as to which the event of default under the third or fourth bullets has occurred, together with any accrued interest, to be immediately due and payable. If the trust does not make this declaration with respect to the junior subordinated debentures, the holders of at least 25% in aggregate liquidation amount of the capital securities will have such right. Upon certain conditions, such declaration may be annulled by the holders of at least a majority in principal amount of the applicable series of debt securities (voting as one class). If this annulment is not made with respect to the exchange debentures, the holders of a majority in aggregate liquidation amount of the exchange capital securities will have such right. In addition, past defaults may be waived by the holders of a majority in principal amount of the debt securities of all series as to which an event of default has occurred (all series voting as one class), except a default in the payment of principal of or interest or in respect of a covenant or provision which cannot be modified or amended without the consent of each affected holder. If the trust does not make this waiver with respect to the exchange debentures, the holders of a majority in aggregate liquidation amount of the exchange capital securities will have such right. Subject to the duty to act with the required standard of care during a default, the indenture trustee may be indemnified by the holders of debt securities before proceeding to exercise any right or power under the indenture at the request of such holders. The holders of a majority in principal amount of the affected debt securities of any one or more series may direct the time, method and place of conducting any proceeding for any remedy available to the indenture trustee, or exercising any trust or power conferred on the indenture trustee. We will annually file with the indenture trustee a certificate as to the absence of any default or specifying any default that exists under the indenture. ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF CAPITAL SECURITIES If a default has occurred and is continuing under the indenture and such event is attributable to our failure to pay interest or principal on the exchange debentures on the date due, a holder of exchange capital securities may institute a legal proceeding directly against us for enforcement of payment to such holder of the principal of or interest on such related exchange debentures having a principal amount equal to the aggregate liquidation amount of the related exchange capital securities of such holder. We may not amend the indenture to remove the foregoing right to bring a direct action without the prior written consent of the holders of all of the exchange capital securities. Notwithstanding any payments made to a holder of exchange capital securities in connection with a direct action, we will remain obligated to pay the principal of or interest on the exchange debentures, and shall be subrogated to that holder's rights with respect to any payments made in any direct action. The holders of the exchange capital securities will not be able to exercise directly any remedies, other than those set forth in the preceding paragraph, available to the holders of exchange debentures unless there has been an event of default under the trust agreement. CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS o We may not merge or consolidate or sell or convey all or substantially all of our assets unless: 35 o the successor entity (if other than us) is a U.S. entity that assumes all of our obligations under the indenture and on the debt securities issued under the indenture, including the exchange debentures, and, after giving effect to such transaction, we or the successor would not be in default under the indenture; and o certain other conditions as prescribed in the indenture are met. THE PROVISIONS OF THE INDENTURE DO NOT AFFORD HOLDERS OF THE EXCHANGE DEBENTURES PROTECTION IN THE EVENT OF A HIGHLY LEVERAGED OR OTHER TRANSACTION THAT MAY ADVERSELY AFFECT HOLDERS OF THE EXCHANGE DEBENTURES. SATISFACTION AND DISCHARGE The indenture will cease to be of further effect (except as to certain remaining rights), and we will be deemed to have satisfied and discharged the indenture when o all debt securities issued under the indenture not previously delivered to the indenture trustee for cancellation have become due and payable or will become due and payable at their stated maturity within one year, and o we deposit funds in trust with the indenture trustee in an amount sufficient to pay and discharge the entire indebtedness on the debt securities issued under the indenture not previously delivered to the indenture trustee for cancellation. LEGAL DEFEASANCE AND COVENANT DEFEASANCE We may, at our option and at any time, elect to have all of our obligations discharged with respect to the outstanding exchange debentures (legal defeasance) except for: o the rights of holders of outstanding exchange debentures to receive payments in respect of the principal of, or interest or premium, if any, on such exchange debentures when such payments are due from the defeasance trust referred to below; o our obligations with respect to the exchange debentures concerning issuing temporary debentures, mutilated, destroyed, lost or stolen exchange debentures and the maintenance of an office or agency for payment and money for security payments held in the defeasance trust; o the rights, powers, trusts, duties and immunities of the indenture trustee, and our obligations in connection therewith; and o the defeasance provisions of the indenture. In addition, we may, at our option and at any time, elect to have our obligations released with respect to certain covenants that are described in the indenture (covenant defeasance) and thereafter any omission to comply with those covenants will not constitute a default or event of default with respect to the exchange debentures. In the event covenant defeasance occurs, certain events (not including non-payment, bankruptcy, receivership, rehabilitation and insolvency events) described under "Events of Default" will no longer constitute an event of default with respect to the exchange debentures. In order to exercise either legal defeasance or covenant defeasance: o we must irrevocably deposit with the indenture trustee, in a defeasance trust, for the benefit of the holders of the exchange debentures, cash in U.S. dollars, non-callable government securities, or a combination of cash in U.S. dollars and non-callable government securities, in amounts as will be sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal of, or interest and premium, if any, on the outstanding exchange debentures on the stated maturity or on the applicable redemption 36 date, as the case may be, and we must specify whether the exchange debentures are being defeased to maturity or to a particular redemption date; o in the case of legal defeasance, we must deliver to the indenture trustee an opinion of nationally recognized independent tax counsel reasonably acceptable to the indenture trustee confirming that (a) we have received from, or there has been published by, the Internal Revenue Service a ruling or (b) since the date of the indenture, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such opinion of counsel will confirm that, the holders of the outstanding exchange debentures will not recognize income, gain or loss for federal income tax purposes as a result of such legal defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such legal defeasance had not occurred; o in the case of covenant defeasance, we must deliver to the indenture trustee an opinion of nationally recognized independent tax counsel reasonably acceptable to the indenture trustee confirming that the holders of the outstanding exchange debentures will not recognize income, gain or loss for federal income tax purposes as a result of such covenant defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such covenant defeasance had not occurred; o no default or event of default has occurred and is continuing under the indenture on the date of such deposit (other than a default or event of default under the indenture resulting from the borrowing of funds to be applied to such deposit); o such legal defeasance or covenant defeasance will not result in a breach or violation of, or constitute a default under any material agreement or instrument (other than the indenture) to which we or any of our subsidiaries is a party or by which we or any of our subsidiaries is bound; o we must deliver to the indenture trustee an officers' certificate stating that the deposit was not made by us with the intent of preferring the holders of exchange debentures over our other creditors with the intent of defeating, hindering, delaying or defrauding our creditors or others; and o we must deliver to the indenture trustee an officers' certificate and an opinion of counsel, each stating that all conditions precedent relating to the legal defeasance or the covenant defeasance have been complied with. SUBORDINATION We have covenanted and agreed that our obligations to make any payment on the exchange debentures (and any other debt securities issued under the indenture) will be subordinate and junior in right of payment to our obligations to holders of our senior indebtedness to the extent described in the next two paragraphs. Senior indebtedness with respect to the exchange debentures means: o any of our indebtedness for borrowed money, whether or not evidenced by bonds, debentures, notes or other written instruments; o any obligations under our letters of credit; o any of our indebtedness or other obligations with respect to commodity contracts, interest rate and currency swap agreements, cap, floor and collar agreements, currency spot and forward contracts, and other similar agreements or arrangements designed to protect against fluctuations in currency exchange or interest rates; and o any guarantees, endorsements (other than by endorsement of negotiable instruments for collection in the ordinary course of business) or other similar contingent obligations in respect of obligations of others of a type described in the foregoing three 37 bullets, whether or not such obligation is classified as a liability, in each case, whether outstanding on the date of execution of the indenture or thereafter incurred, other than obligations expressly ranking equally with or junior to the exchange debentures. However the exchange debentures will not be subordinate and junior in right of payment to trade creditors. As of September 30, 2001, we had approximately $1,084 million of senior indebtedness outstanding. The indenture does not limit the amount of future increases in our senior indebtedness. We expect from time to time to issue additional senior indebtedness. No payments in respect of the junior subordinated debentures may be made if there has occurred and is continuing: o a default in any payment with respect to senior indebtedness, or o an event of default with respect to any senior indebtedness resulting in the acceleration of the maturity thereof, or o any judicial proceeding pending with respect to any such default. In the case of any insolvency, receivership, conservatorship, reorganization, readjustment of debt, marshaling of assets and liabilities or similar proceedings or any liquidation or winding-up of or relating to us as a whole, whether voluntary or involuntary, all of our obligations to holders of our senior indebtedness will be entitled to be paid in full in cash before any payment will be made in respect of the exchange debentures. In the event of any such proceeding, after payment in full in cash of all sums owing with respect to our senior indebtedness, the holders of the exchange debentures, together with the holders of any of our obligations ranking equally with the exchange debentures, will be entitled to be paid from our remaining assets. By reason of such subordination, in the event of our insolvency, holders of our senior indebtedness may receive more, ratably, and holders of the exchange debentures having a claim pursuant to the exchange debentures may receive less, ratably, than our other creditors. Such subordination will not prevent the occurrence of any event of default in respect of the exchange debentures. GOVERNING LAW The indenture and the exchange debentures are governed by and are to be construed in accordance with the laws of the State of New York. INFORMATION CONCERNING THE INDENTURE TRUSTEE Following the exchange offer and the qualification of the indenture under the Trust Indenture Act, the indenture trustee will be subject to all the duties and responsibilities specified with respect to an indenture trustee under the Trust Indenture Act. Subject to such provisions, the indenture trustee is under no obligation to exercise any of the powers vested in it by the indenture at the request of any holder of exchange debentures, unless offered reasonable indemnity by such holder against the costs, expenses and liabilities which it might incur. The indenture trustee is not required to expend or risk its own funds or otherwise incur personal financial liability in the performance of its duties if the indenture trustee reasonably believes that repayment or adequate indemnity is not reasonably assured to it. DESCRIPTION OF EXCHANGE GUARANTEE We will execute and deliver the exchange guarantee at the same time the exchange capital securities are issued. The terms of the exchange guarantee are identical in all material respects to the terms of the old guarantee. Selected provisions of the exchange guarantee agreement are summarized below. This summary is not complete. You should read that document for a better understanding of all of the provisions of the guarantee agreement that may be important to you. The guarantee agreement will be qualified under the Trust Indenture Act of 1939 upon effectiveness of the registration statement for the exchange offer of which this prospectus forms a part. The guarantee trustee will hold the guarantee for the benefit of the holders of all capital securities. 38 GENERAL We will fully and unconditionally agree, to the extent described herein, to pay on a subordinated basis the guarantee payments described below to the holders of all exchange capital securities, as and when due. We must make these payments regardless of any defense, right of set-off or counterclaim that the trust may have or assert, other than the defense of payment. We will make the following payments with respect to the exchange capital securities to the extent not paid by or on behalf of the trust: o any accumulated and unpaid distributions required to be paid on the exchange capital securities, to the extent that the trust has sufficient funds on hand to make such payments, o the applicable redemption price with respect to exchange capital securities called for redemption, to the extent that the trust has sufficient funds on hand to make such payments, and o upon a voluntary or involuntary termination, dissolution, winding-up or liquidation of the trust (unless the exchange debentures are distributed to holders of the exchange capital securities), the lesser of - the aggregate of the liquidation amount plus accumulated and unpaid distributions on the exchange capital securities to but excluding the date of payment, to the extent that the trust has sufficient funds on hand to make such payments, and - the amount of assets of the trust remaining available for distribution to holders of exchange capital securities in liquidation of the trust. Our obligation to make a guarantee payment may be satisfied by our direct payment of the required amounts to the holders of the exchange capital securities or by causing the trust to pay those amounts to those holders. The guarantee is an irrevocable guarantee on a subordinated basis of the trust's related obligations under all capital securities, but will apply only to the extent that the trust has funds sufficient to make such payments, and is not a guarantee of collection. If we do not make interest payments on the exchange debentures held by the trust, the trust will not have funds legally available for, and will not be able to pay, distributions on the exchange capital securities. In such event, holders of the exchange capital securities would not be able to rely on the exchange guarantee for such payments. The exchange guarantee will rank subordinate and junior in right of payment to all of our liabilities, other than any liabilities which expressly by their terms rank equally with or subordinate to our obligations under the exchange guarantee. Since we are a holding company, our right to participate in any distribution of assets of any subsidiary upon its liquidation or reorganization or otherwise (and thus the ability of holders of exchange capital securities to benefit indirectly from such distribution) is subject to the prior claims of creditors of that subsidiary, except to the extent that we ourselves may be recognized as a creditor of that subsidiary. Claims on our subsidiaries by creditors other than ourselves include long-term debt and certain other short-term borrowings. Accordingly, our obligations under the exchange guarantee will be effectively subordinated to all existing and future liabilities of our subsidiaries, including under any preferred stock, and claimants should look only to our assets for payments thereunder. The exchange guarantee does not limit the incurrence or issuance by us of secured or unsecured debt, including senior indebtedness. We have, through the exchange guarantee, the trust agreement, the junior subordinated debentures, the indenture and the expense agreement, taken together, fully, irrevocably and unconditionally guaranteed on a subordinated basis all of the trust's obligations under the exchange capital securities. No single document standing alone or operating in conjunction with fewer than all of the other documents constitutes such guarantee. It is only the combined operation of these documents that has the effect of providing a full, irrevocable and unconditional guarantee of the trust's obligations under the exchange capital securities. See "Relationship Among the Exchange Capital Securities, the Exchange Debentures and the Exchange Guarantee." 39 STATUS OF THE EXCHANGE GUARANTEE The exchange guarantee constitutes our unsecured obligation and ranks subordinate and junior in right of payment to all our liabilities (including our obligations under the junior subordinated debentures), other than any liabilities expressly made equal with or subordinate to our obligations under the exchange guarantee and our obligations under any similar guarantee of preferred or capital securities of a trust. The exchange guarantee constitutes a guarantee of payment and not of collection (i.e., the guaranteed party may institute a legal proceeding directly against us to enforce its rights under the exchange guarantee without first instituting a legal proceeding against any other person or entity). The guarantee is held for the benefit of the holders of all capital securities. The exchange guarantee will not be discharged except by payment or provision for payment of the guarantee payments in full to the extent not paid by the trust or upon distribution of the exchange debentures to the holders of the exchange capital securities. AMENDMENTS AND ASSIGNMENT The exchange guarantee agreement may not be amended without the prior approval of the holders of not less than a majority of the aggregate liquidation amount of outstanding capital securities, except with respect to any changes which do not adversely affect the rights of holders of the capital securities. The manner of obtaining any such approval will be as set forth under "Description of Exchange Capital Securities--Voting Rights; Amendment of the Trust Agreement." All guarantees and agreements contained in the exchange guarantee agreement shall bind our successors, assigns, receivers, trustees and representatives and shall inure to the benefit of the holders of outstanding capital securities. EVENTS OF DEFAULT Our failure to perform any of our payment or other obligations under the exchange guarantee agreement will constitute an event of default under the exchange guarantee agreement. The holders of not less than a majority in aggregate liquidation amount of the capital securities will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the guarantee trustee in respect of the exchange guarantee or to exercise any trust or power under the exchange guarantee agreement conferred on the guarantee trustee or to waive, on behalf of the holders, any past events of default. Any holder of the capital securities may institute a legal proceeding directly against us to enforce its rights under the exchange guarantee without first instituting a legal proceeding against the trust, the guarantee trustee or any other person or entity. We, as guarantor, are required to file annually with the guarantee trustee a certificate as to whether or not we are in compliance with all the conditions and covenants applicable to us under the exchange guarantee agreement. CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS The exchange guarantee agreement provides that o we will not consolidate with or merge into any other entity, o we shall not convey, transfer or lease all or substantially all of our properties and assets to any other entity, and o no entity will consolidate with or merge into us or convey, transfer or lease all or substantially all of its properties and assets to us, unless 40 o either we are the continuing corporation, or the successor entity is organized under the laws of the United States or any state or the District of Columbia and such successor entity expressly assumes our obligations under the guarantee, o immediately after giving effect thereto, no event of default under the exchange guarantee agreement and no event which, after notice or lapse of time or both, would become an event of default under the exchange guarantee agreement, has happened and is continuing, and o certain other conditions as prescribed in the exchange guarantee agreement are met. INFORMATION CONCERNING THE GUARANTEE TRUSTEE The guarantee trustee, other than during the occurrence and continuance of a default by us in performance of the exchange guarantee, undertakes to perform only such duties as are specifically set forth in the exchange guarantee agreement. After a default with respect to the exchange guarantee, the guarantee trustee must exercise the same degree of care and skill as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this provision, the guarantee trustee is under no obligation to exercise any of the powers vested in it by the exchange guarantee agreement at the request of any holder of the capital securities unless it is offered reasonable indemnity against the costs, expenses and liabilities that it might thereby incur. TERMINATION OF THE EXCHANGE GUARANTEE The exchange guarantee will terminate and be of no further force and effect upon o full payment of the applicable redemption price of the exchange capital securities, o full payment of the amounts payable upon liquidation of the trust, o distribution of the exchange debentures to the holders of the exchange capital securities upon liquidation of the trust, or o the exchange capital securities ceasing to be outstanding following the consummation of the exchange offer. The exchange guarantee will continue to be effective or will be reinstated, as the case may be, if at any time any holder of the exchange capital securities must restore payment of any sums paid under the exchange capital securities or the exchange guarantee. GOVERNING LAW The exchange guarantee is governed by and to be construed in accordance with the laws of the State of New York. THE EXPENSE AGREEMENT Pursuant to the expense agreement, we have irrevocably and unconditionally guaranteed to each person or entity to whom the trust becomes indebted or liable, the full payment of any costs, expenses or liabilities of the trust, other than obligations of the trust to pay to the holders of any trust securities the amounts due such holders pursuant to the terms of the trust securities. 41 DESCRIPTION OF OLD SECURITIES We refer to the old capital securities, the guarantee issued by us in connection with the old capital securities and the old debentures collectively as the old securities and refer to the exchange capital securities, the exchange guarantee and the exchange debentures collectively as the exchange securities. The terms of the old securities are identical in all material respects to the exchange securities, except that old securities have not been registered under the Securities Act, are subject to certain restrictions on transfer and are entitled to certain rights under the exchange and registration rights agreement, which rights will terminate upon consummation of the exchange offer, except under limited circumstances. The old securities provide that, if we or the trust failed to take certain steps to effect the exchange offer and complete the exchange within certain prescribed time periods, then, as liquidated damages, special interest of up to 50 basis points per annum would become payable in respect of the old debentures and corresponding distributions would become payable on the old capital securities for the period from the occurrence of such event until such time as the exchange offer has been consummated. The exchange securities are not, and upon consummation of the exchange offer, the original securities will not be, entitled to any such additional interest or distribution. Accordingly, holders of old capital securities should review the information set forth under "Risk Factors -- Your failure to exchange old capital securities may adversely affect your ability to sell such securities" and "Description of Exchange Capital Securities." RELATIONSHIP AMONG THE EXCHANGE CAPITAL SECURITIES, THE EXCHANGE DEBENTURES AND THE EXCHANGE GUARANTEE FULL AND UNCONDITIONAL GUARANTEE Payments of distributions and other amounts due on the exchange capital securities (to the extent the trust has funds available for the payment of such distributions) are and will continue to be irrevocably guaranteed by us as set forth under "Description of Guarantee." Taken together, our obligations under the exchange debentures, the indenture, the trust agreement, the expense agreement, the guarantee agreement and the guarantee provide a full, irrevocable and unconditional guarantee of payments of distributions and other amounts due on the exchange capital securities. No single document standing alone or operating in conjunction with fewer than all of the other documents constitutes such guarantee. It is only the combined operation of these documents that has the effect of providing a full, irrevocable and unconditional guarantee of the trust's obligations under the exchange capital securities. If and to the extent that we do not make payments on the exchange debentures, the trust will not pay distributions or other amounts due on the exchange capital securities. The exchange guarantee does not cover payment of distributions when the trust does not have sufficient funds to pay those distributions. In that event, the remedy of a holder of exchange capital securities is to institute a direct action. Our obligations under the exchange guarantee are subordinate and junior in right of payment to all our other liabilities as set forth in the exchange guarantee agreement. SUFFICIENCY OF PAYMENTS As long as payments are made when due on the exchange debentures, they will be sufficient to cover distributions and other payments due on the trust securities, primarily because o the aggregate principal amount of the exchange debentures will be equal to the sum of the aggregate liquidation amount or redemption price, as applicable, of the trust securities; o the interest rate and interest and other payment dates on the exchange debentures will match the distribution rate and distribution and other payment dates for the trust securities; o under the expense agreement, we will pay for all and any costs, expenses and liabilities of the trust except the trust's obligations to holders of trust securities under such trust securities; and 42 o the trust agreement further provides that the trust will not engage in any activity that is not consistent with the limited purposes thereof. ENFORCEMENT RIGHTS OF HOLDERS OF EXCHANGE CAPITAL SECURITIES A holder of any exchange capital security may institute a legal proceeding directly against us to enforce its rights under the exchange guarantee without first instituting a legal proceeding against the guarantee trustee, the trust or any other person or entity. A default under any senior indebtedness would not constitute a default under the trust agreement. Moreover, in the event of payment defaults under, or acceleration of, senior indebtedness, the subordination provisions of the indenture provide that no payments may be made in respect of the exchange debentures until such senior indebtedness has been paid in full or any payment default thereunder has been cured or waived. Failure to make required payments on exchange debentures would constitute an event of default under the trust agreement. LIMITED PURPOSES OF THE TRUST The exchange capital securities evidence an undivided beneficial interest in the assets of the trust. The trust exists for the exclusive purposes of issuing and selling the trust securities, using the proceeds from the sale of the trust securities to acquire the exchange debentures, exchanging the old debentures for exchange debentures in the exchange offer and engaging in only those other activities necessary, convenient or incidental thereto (such as registering the transfer of capital securities). A principal difference between the rights of a holder of an exchange capital security and a holder of an exchange debenture is that a holder of an exchange debenture is entitled to receive from us the principal amount of and interest accrued on exchange debentures held, while a holder of capital securities is entitled to receive distributions from the trust (or from us under the guarantee) if and to the extent the trust has funds available for the payment of such distributions. RIGHTS UPON TERMINATION Upon any voluntary or involuntary termination, winding-up or liquidation of the trust involving the liquidation of the exchange debentures, after satisfaction of liabilities to creditors as required by applicable law, the holders of the trust securities will be entitled to receive the liquidation distribution in cash out of trust assets. Upon our voluntary or involuntary liquidation or bankruptcy, the property trustee, as holder of the exchange debentures, would be our creditor, subordinated in right of payment to all senior indebtedness as set forth in the indenture, but entitled to receive payment in full before our stockholders receive payments or distributions. Since we are the guarantor under the exchange guarantee and have agreed under the expense agreement to pay for all costs, expenses and liabilities of the trust (other than the trust's obligations to the holders of its trust securities), the positions of a holder of exchange capital securities and a holder of exchange debentures relative to other creditors and to our stockholders in the event of our liquidation or bankruptcy are expected to be substantially the same. CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES The following summary describes certain United States federal income tax consequences of the purchase, ownership and disposition of exchange capital securities as of the date of this prospectus, and represents the opinion of Thelen Reid & Priest LLP, our counsel, insofar as it relates to matters of law or legal conclusions. Except where noted, it deals only with exchange capital securities held as capital assets within the meaning of Section 1221 of the Internal Revenue Code of 1986, as amended, and does not deal with special situations, such as those of tax-exempt organizations, dealers in securities or currencies, banks, financial institutions, life insurance companies, real estate investment trusts, regulated investment companies, persons holding exchange capital securities as part of a hedging or conversion transaction or a straddle, persons who mark to market their securities, United States holders (as defined below) whose "functional currency" is not the United States dollar, or persons who are not United States holders. In addition, this discussion does not address any tax consequences to persons who purchase capital securities other than pursuant to their initial issuance and distribution. It also does not include any description of any alternative minimum tax consequences or of the tax laws 43 of any state, local or foreign jurisdiction. Furthermore, the discussion below is based upon the provisions of the Internal Revenue Code and income tax regulations, administrative rulings and judicial decisions under the Internal Revenue Code as of the date of this prospectus, and those authorities may be repealed, revoked or modified, with either forward-looking or retroactive effect, so as to result in United States federal income tax consequences different from those discussed below. PROSPECTIVE PURCHASERS OF EXCHANGE CAPITAL SECURITIES ARE ADVISED TO CONSULT WITH THEIR TAX ADVISORS AS TO THE UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF SUCH EXCHANGE CAPITAL SECURITIES IN LIGHT OF THEIR PARTICULAR CIRCUMSTANCES, AS WELL AS THE EFFECTS OF ANY STATE, LOCAL, FOREIGN OR OTHER TAX LAWS. As used in this prospectus, a "United States holder" is a beneficial owner of a capital security that is, for United States federal income tax purposes: o a citizen or resident of the United States, o a corporation, or other entity treated as a corporation for United States federal income tax purposes, created or organized in or under the laws of the United States or any political subdivision thereof, o an estate, the income of which is subject to United States federal income taxation regardless of its source, or o a trust the administration of which is subject to the primary supervision of a court within the United States and for which one or more United States persons have the authority to control all substantial decisions. If a partnership holds exchange capital securities, the United States federal income tax treatment of a partner generally will depend upon the status of the partner and the activities of the partnership. Partners of partnerships holding exchange capital securities should consult their tax advisors. As used in this prospectus, a "non-United States holder" is a beneficial owner of an exchange capital security that is not a United States holder. CLASSIFICATION OF THE TRUST Thelen Reid & Priest LLP, our counsel, is of the opinion that, under current law and assuming full compliance with the terms of the trust agreement and the indenture, the instruments establishing the trust, and certain other documents, the trust will be classified as a "grantor trust" for United States federal income tax purposes and will not be classified as an association taxable as a corporation. Accordingly, each United States holder will be treated as owning an undivided beneficial interest in the exchange debentures. Investors should be aware that the opinion of Thelen Reid & Priest LLP is not binding on the Internal Revenue Service or the courts. CLASSIFICATION OF THE EXCHANGE DEBENTURES Based on the advice of Thelen Reid & Priest LLP, we believe and intend to take the position that the exchange debentures will constitute indebtedness for United States federal income tax purposes. No assurance can be given that this position will not be challenged by the Internal Revenue Service or, if challenged, that the challenge will not be successful. If the Internal Revenue Service successfully challenged the treatment of the exchange debentures as indebtedness, the exchange debentures would be subject to redemption at our option as described under the caption "Description of Exchange Debentures--Redemption." Such a redemption would cause a mandatory redemption of the exchange capital securities as described under the caption "Description of Capital Securities--Right to Redeem Upon a Special Event." By purchasing and accepting capital securities, each United States holder covenants to treat the exchange debentures as indebtedness and the capital securities as evidence of an indirect beneficial ownership in the exchange debentures. The remainder of this discussion assumes that the exchange debentures will be classified as indebtedness for United States federal income tax purposes. 44 UNITED STATES HOLDERS Payments of Interest Except as set forth below, stated interest on the exchange debentures will generally be taxable to a United States holder as ordinary income at the time it is paid or accrued in accordance with the United States holder's method of accounting for tax purposes. No portion of that income will be eligible for the dividends-received deduction. Original Issue Discount We have the right to extend the interest payment period on the exchange debentures from time to time for a period not exceeding 10 consecutive semi-annual periods prior to the stated maturity of the exchange debentures. We believe that the likelihood of our extending the interest payment period on the exchange debentures is "remote" within the meaning of applicable income tax regulations, in part because doing so would prevent us from making certain payments with respect to our capital stock and certain of our debt securities. See "Description of Exchange Debentures--Option to Defer Interest Payments." Consequently, we believe that the exchange debentures will not be treated as having been issued with original issue discount for United States federal income tax purposes. It should be noted that the regulations have not yet been addressed in any rulings or other interpretations by the Internal Revenue Service. Accordingly, it is possible that the Internal Revenue Service could take a different position. If we exercised our right to extend an interest payment period, the exchange debentures would at that time be treated as having been retired and reissued with original issue discount. As a result, United States holders would be required, for the remaining term of the exchange debentures, to accrue interest income even if they used the cash method of accounting. Consequently, in the event that the payment of interest was deferred, a United States holder would be required to include original issue discount in income on an economic accrual basis, notwithstanding that we would not make any interest payments on the exchange debentures during the extension period. Exchange Offer; Registration Rights Neither the exchange of capital securities for exchange capital securities in the exchange offer nor the SEC registration of capital securities will constitute a taxable exchange of the capital securities for United States federal income tax purposes. Thus, there will be no material United States federal income tax consequences to a United States holder as a result of (i) exchanging old capital securities for exchange capital securities in the exchange offer or (ii) the SEC registration of exchange capital securities. Accordingly, the exchange capital securities should have the same issue price as the capital securities, and a United States holder shall have the same adjusted tax basis and holding period in the exchange capital securities as such holder had in the capital securities immediately prior to the exchange. Receipt of Exchange Debentures or Cash Upon Liquidation of the Trust As described under the caption "Description of Exchange Securities--Liquidation of the Trust and Distribution of Exchange Debentures," the exchange debentures may be distributed to holders in exchange for the exchange capital securities in liquidation of the trust, provided that we have first received an opinion of nationally recognized independent tax counsel to the effect that the distribution will not constitute a taxable exchange of the exchange capital securities for United States federal income tax purposes. In the event of such a distribution, each United States holder would receive an aggregate tax basis in the exchange debentures equal to the holder's aggregate tax basis in its capital securities. A United States holder's holding period for the exchange debentures received in liquidation of the trust would include the period during which the holder held the exchange capital securities. Under certain circumstances, as described under the captions "Description of Exchange Debentures-Redemption" and "Description of Exchange Capital Securities-Right to Redeem Upon a Special Event," the exchange debentures may be redeemed for cash and the proceeds of the redemption distributed to holders of exchange capital securities in redemption of the 45 exchange capital securities. Under current law, that redemption would constitute a taxable disposition of the exchange capital securities, and a United States holder would recognize gain or loss as if the holder had sold the redeemed exchange capital securities. Sale, Exchange and Redemption of the Exchange Capital Securities Upon a sale, exchange, redemption or other taxable disposition of exchange capital securities, a United States holder will recognize gain or loss equal to the difference between the amount realized upon the disposition, excluding amounts attributable to accrued and unpaid interest, and the holder's adjusted tax basis in the exchange capital securities. A United States holder's adjusted tax basis in an exchange capital security generally will equal such holder's initial purchase price, increased by the amount of any original issue discount previously includible in the gross income of the holder and decreased by the amount of any subsequent payments received on the exchange capital security. The gain or loss will be capital gain or loss and will be long-term capital gain or loss if, at the time of the disposition, the exchange capital securities have been held for more than one year. Generally, for non-corporate United States holders, net long-term capital gains are subject to United States federal income tax at a maximum rate of 20%. The exchange capital securities may trade at a price that does not fully reflect the value of accrued but unpaid interest with respect to the underlying exchange debentures. If you sell your exchange capital securities between record dates for payments of distributions, you will not receive subsequent distributions but will nevertheless be required to include in gross income for United States federal income tax purposes your ratable share of accrued and unpaid interest on the exchange debentures through the date of the sale. To the extent the selling price is less than your adjusted tax basis in the exchange capital securities sold, you will recognize a capital loss. Subject to certain limited exceptions, capital losses cannot be applied to offset ordinary income for United States federal income tax purposes. Information Reporting and Backup Withholding In general, information reporting will apply to distributions paid and original issue discount accrued on the exchange capital securities, and to the proceeds of a sale of exchange capital securities, except in the case of an exempt holder, such as a corporation. A 30.5% backup withholding tax (subject to phased-in rate reductions) will apply to such payments if a holder fails to provide a taxpayer identification number and to satisfy other requirements, unless the holder has provided a certificate of exempt status. NON-UNITED STATES HOLDERS Payments of Interest Subject to the discussion below concerning backup withholding, no withholding of United States federal income tax will be required with respect to distributions on exchange capital securities held by a non-United States holder (or with respect to the underlying interest paid or accrued on the exchange debentures), provided that the beneficial owner (1) does not actually or constructively own 10% or more of the total combined voting power of all classes of our stock entitled to vote within the meaning of Section 871(h)(3) of the Internal Revenue Code and the regulations thereunder, (2) is not a controlled foreign corporation related, directly or indirectly, to us through stock ownership, (3) is not a bank whose receipt of interest in respect of the exchange debentures is described in Section 881(c)(3)(A) of the Internal Revenue Code, and (4) satisfies the statement requirement, described generally below, set forth in Section 871(h) and Section 881(c) of the Internal Revenue Code and the regulations thereunder. To satisfy the requirement referred to in clause (4) above, the beneficial owner of a exchange capital security, or a financial institution holding the exchange capital security on behalf of such owner, must, in accordance with specified procedures, provide the trust or its paying agent with a statement to the effect that the beneficial owner is not a United States person. These requirements will be met if (1) the beneficial owner provides its name and address and certifies, under penalties of perjury, that it is not a United States person, which certification should be made on an IRS Form W-8BEN, or (2) a financial institution holding the capital security on behalf of the 46 beneficial owner certifies, under penalties of perjury, that such statement has been received by it and furnishes a paying agent with a copy thereof. In the event that any of the above requirements is not satisfied, the trust will nonetheless not withhold United States federal income tax on distributions paid to a non-United States holder if it receives an IRS Form W-8ECI from the non-United States holder, establishing that such income is effectively connected with the conduct by the non-United States holder of a trade or business in the United States, unless the trust has knowledge to the contrary. Interest paid to a non-United States holder that is effectively connected with the conduct by the holder of a trade or business in the United States is generally taxed at the graduated rates that are applicable to United States persons. In the case of a non-United States holder that is a corporation, such effectively connected income may also be subject to the United States federal branch profits tax, which is generally imposed on a foreign corporation on the deemed repatriation from the United States of effectively connected earnings and profits, at a 30% rate, unless the rate is reduced or eliminated by an applicable income tax treaty and the non-United States holder is a qualified resident of the treaty country. Exchange Offer; Registration Rights Neither the exchange of capital securities for exchange capital securities in the exchange offer nor the SEC registration of capital securities will constitute a taxable exchange of the capital securities for United States federal income tax purposes. Thus, there will be no material United States federal income tax consequences to a United States holder as a result of (i) exchanging old capital securities for exchange capital securities in the exchange offer or (ii) the SEC registration of exchange capital securities. Accordingly, the exchange capital securities should have the same issue price as the capital securities, and a non-United States holder shall have the same adjusted tax basis and holding period in the exchange capital securities as such holder had in the capital securities immediately prior to the exchange. Sale, Exchange and Redemption of the Exchange Capital Securities A non-United States holder generally will not be subject to United States federal income tax with respect to gain recognized on a sale, exchange or redemption of a exchange capital security unless (1) the gain is effectively connected with a trade or business of the non-United States holder in the United States, (2) in the case of a non-United States holder who is an individual, such holder is present in the United States for 183 or more days in the taxable year of the sale or other disposition and certain other conditions are met or (3) the non-United States holder is subject to tax pursuant to certain provisions of the Internal Revenue Code applicable to United States expatriates. However, any amount attributable to accrued but unpaid interest will be treated in the same manner as distributions made to such non-United States holder, as described above. Gain derived by a non-United States holder from the sale or other disposition of a exchange capital security that is effectively connected with the conduct by the holder of a trade or business in the United States is generally taxed at the graduated rates that are applicable to United States persons. In the case of a non-United States holder that is a corporation, such effectively connected income may also be subject to the United States branch profits tax. If any individual non-United States holder falls under clause (2) of the preceding paragraph, such holder will be subject to a flat 30% tax on the gain derived from the sale or other disposition, which may be offset by certain United States source capital losses recognized within the same taxable year as such sale or other disposition. Information Reporting and Backup Withholding Non-United States holders will not be subject to information reporting or backup withholding on payments made by the trust or its paying agent if a statement described in clause (4) under "Payments of Interest" has been received and the payor has no actual knowledge that the beneficial owner is a United States person. In addition, backup withholding and information reporting will not apply to payments of the liquidation amount of, or distributions on, the exchange capital securities paid or collected by a foreign office of a custodian, nominee or other foreign agent on behalf of a non-United States holder, or if a foreign office of a broker pays the proceeds of the sale of exchange capital securities to a non-United States holder. If, however, such nominee, custodian, agent or broker is, for United States federal income tax 47 purposes, a United States person, a controlled foreign corporation, a foreign person that derives 50% or more of its gross income for certain periods from the conduct of a U.S. trade or business, or a foreign partnership with certain connections to the United States, such payments will not be subject to backup withholding (unless the payor has actual knowledge that the payee is a United States person) but will be subject to information reporting unless (1) such custodian, nominee, agent or broker has documentary evidence that the beneficial owner is not a United States person and certain other conditions are met or (2) the beneficial owner otherwise establishes an exemption. Distributions on the exchange capital securities paid to a non-United States holder by a United States office of a custodian, nominee or agent, or payment of the proceeds of a sale of capital securities by the United States office of a broker will be subject to backup withholding and information reporting unless (1) the non-United States holder provides the statement described above that such holder is not a United States person and the payor does not have actual knowledge to the contrary or (2) the beneficial owner otherwise establishes an exemption. Any amounts withheld under the backup withholding rules will be allowed as a credit or a refund against the holder's United States federal income tax liability, if certain required information is provided to the Internal Revenue Service. CERTAIN ERISA CONSIDERATIONS The Employee Retirement Income Security Act of 1974, as amended ("ERISA"), imposes certain requirements upon employee benefit plans subject thereto ("ERISA Plans") and on those persons who are fiduciaries with respect to ERISA Plans. In particular, investments by ERISA Plans are subject to ERISA's general fiduciary requirements, including the requirements of investment prudence and diversification and the requirement that an ERISA Plan's investments be made in accordance with its governing documents. A fiduciary of an ERISA Plan should consider the fiduciary standards under ERISA in the context of the particular circumstances of the investing ERISA Plan before authorizing an investment in the exchange capital securities. Such fiduciary should determine whether an investment in the exchange capital securities satisfies ERISA's diversification and prudence requirements and whether the investment is in accordance with the documents and instruments governing the plan. In addition, ERISA and the Internal Revenue Code prohibit a wide range of transactions ("Prohibited Transactions") involving ERISA Plans or other employee benefit plans that are not subject to ERISA but that are subject to Section 4975 of the Internal Revenue Code, such as individual retirement accounts (together with ERISA Plans, "Plans") and persons who have certain specified relationships to the Plan ("parties in interest," within the meaning of ERISA, and "disqualified persons," within the meaning of the Internal Revenue Code). If engaged in by a Plan, such transactions may require "correction" and may cause a Plan fiduciary to incur certain liabilities and the parties in interest or disqualified persons to be subject to excise taxes, unless a statutory or administrative exemption is available. The U.S. Department of Labor ("DOL") has promulgated a regulation, 29 C.F.R. Section 2510.3-101 (the "Plan Asset Regulation"), describing what constitutes the assets of a Plan with respect to the Plan's investment in an entity for purposes of ERISA and Section 4975 of the Internal Revenue Code. Under the Plan Asset Regulation, if a Plan invests (directly or indirectly) in an exchange capital security, the Plan's assets will include both the exchange capital security and an undivided interest in each of the underlying assets of the trust unless it is established that equity participation in the trust by benefit plan investors (including, but not limited to, Plans and entities whose underlying assets include plan assets by reason of an employee benefit plan's investment in the entity) is not "significant" within the meaning of the Plan Asset Regulation. In this regard, the extent of equity participation by benefit plan investors in the trust will not be monitored. If any assets of the trust are deemed to constitute the assets of a Plan, transactions involving the assets of the trust could give rise to a Prohibited Transaction unless a statutory or administrative exemption is available. Certain statutory or administrative exemptions (each, a "Prohibited Transaction Class Exemption" or "PTCE") may be available under ERISA to exempt the purchase, holding and/or disposition of any exchange capital securities by a Plan. Included among the administrative exemptions are: PTCE 90-1, regarding investments by insurance company pooled separate accounts; PTCE 91-38, regarding investments by bank collective investment funds; PTCE 84-14, regarding 48 transactions effected by a qualified professional asset manager; PTCE 95-60, regarding investments by insurance company general accounts; and PTCE 96-23, regarding investments by an in-house professional asset manager. Certain of the exemptions, however, do not afford relief from the prohibition on self-dealing contained in Section 406(b) of ERISA and Section 4975(c)(1)(E)-(F) of the Internal Revenue Code. In addition, there can be no assurance that any of these administrative exemptions will be available with respect to any particular transaction involving the exchange capital securities. In addition to the Prohibited Transaction Class Exemptions, an individual exemption may apply to the initial purchase, holding and secondary market resales of exchange capital securities by a Plan, provided certain specified conditions are met. As noted above, if a Plan acquires any exchange capital securities, the Plan's assets may be deemed to include both the exchange capital securities acquired and an undivided interest in the underlying assets of the trust, unless the actual investment by benefit plan investors in the exchange capital securities is not "significant" within the meaning of the Plan Asset Regulation. Consequently, the trust assets could be deemed to be "plan assets" of such Plan for purposes of the fiduciary responsibility provisions of ERISA and the prohibited transaction rules. Any person who exercises any authority or control with respect to the management or disposition of the assets of a Plan is considered to be a fiduciary of such Plan. The trustees could, therefore, be considered fiduciaries of Plans that have invested in the exchange capital securities and be subject to the fiduciary responsibility provisions of ERISA and the prohibited transaction rules in exercising its authority with respect to the management of the assets of the trust. If any trustee is considered a fiduciary with respect to the Plans purchasing the exchange capital securities, there may be an improper delegation by such Plans of the responsibility to manage plan assets. In order to avoid such improper delegation, each investing Plan, by purchasing the exchange capital securities, will be deemed to have directed the trustee to invest in the assets held in the trust. Any Plan purchasing the exchange capital securities must ensure that any statutory or administrative exemption from the Prohibited Transaction rules on which such Plan relies with respect to its purchase or holding of the exchange capital securities also applies to such Plan's indirect holding of the assets of the trust. Governmental plans and certain church plans (each as defined under ERISA) are not subject to the prohibited transaction rules of ERISA or the Internal Revenue Code. Such plans, however, may be subject to federal, state or local laws or regulations that may affect their investment in the exchange capital securities. Any fiduciary of such a governmental or church plan considering a purchase of the exchange capital securities must determine the need for, and the availability, if necessary, of any exemptive relief under any such laws or regulations. The foregoing discussion is general in nature and is not intended to be all inclusive. Any fiduciary of an ERISA Plan, a Plan, a governmental plan or a church plan considering the purchase and holding of the exchange capital securities should consult with its legal advisors regarding the consequences of such purchase and holding. By its purchase and acceptance of exchange capital securities, each holder will be deemed to have represented and warranted that either (1) no ERISA Plan assets have been used to purchase such exchange capital securities, or (2) one or more prohibited transaction statutory or administrative exemptions applies such that the use of such ERISA Plan assets to purchase and hold such exchange capital securities and, indirectly, the assets of the trust will not constitute a non-exempt Prohibited Transaction. EACH ERISA PLAN FIDUCIARY (AND EACH FIDUCIARY FOR A GOVERNMENTAL OR CHURCH PLAN SUBJECT TO RULES SIMILAR TO THOSE IMPOSED ON ERISA PLANS UNDER ERISA) SHOULD CONSULT WITH ITS LEGAL ADVISOR CONCERNING AN INVESTMENT IN ANY OF THE EXCHANGE CAPITAL SECURITIES. PLAN OF DISTRIBUTION As more fully discussed in the section of this prospectus entitled "THE EXCHANGE OFFER - Resale of Exchange Capital Securities", based on an interpretation by the SEC's staff contained in several no-action letters issued to third parties, we believe that the exchange capital securities issued pursuant to the exchange offer may be offered for resale, resold and otherwise transferred after the exchange offer by any holder of exchange capital securities (other than a holder which is our "affiliate" within the meaning of Rule 405 under the Securities Act) without compliance with the registration and prospectus delivery provisions of the Securities Act, if such holder: o acquires the exchange capital securities in the ordinary course of his or her business; and 49 o does not intend to participate, and has no arrangement with any person to participate, in a distribution of the exchange capital securities. Each participating broker-dealer in connection with the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of exchange capital securities. This prospectus, as it may be amended or supplemented from time to time, may be used by a participating broker-dealer in connection with resales of exchange capital securities received in exchange for old capital securities where such old capital securities were acquired as a result of market-making activities or other trading activities. We have agreed that we will make this prospectus, as amended or supplemented, available to any participating broker-dealer for use in connection with any such resale and participating broker-dealers shall be authorized to deliver this prospectus for a period ending upon the earlier of the expiration of the 90th day after the exchange offer has been completed or such time as such broker-dealers no longer own any registrable securities, which we define in the exchange and registration rights agreement. We will not receive any proceeds from any sales of the exchange capital securities by participating broker-dealers. Exchange capital securities received by participating broker-dealers for their own account pursuant to the exchange offer may be sold from time to time, in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of options on the exchange capital securities or a combination of such methods of resale, at market prices prevailing at the time of resale, at prices related to the prevailing market prices or at negotiated prices. Any resale may be made directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any participating broker-dealer that resells LEGAL MATTERS The validity of the exchange capital securities, the exchange debentures and the exchange guarantee will be passed upon for us by Stephen F. Koziar, Jr., Group Vice President and General Counsel of DPL and by Thelen Reid & Priest LLP, New York, New York. In addition, matters of federal income tax law and federal securities law will be passed upon by Thelen Reid & Priest LLP. In giving these opinions, as to matters of Ohio law, Thelen Reid & Priest LLP may rely on the opinion of Mr. Koziar and, as to matters of New York law, Mr. Koziar may rely on the opinion of Thelen Reid & Priest LLP. Certain matters of Delaware law relating to the validity of the exchange capital securities will be passed upon on behalf of us and the Trust by Morris, Nichols, Arsht & Tunnell, special Delaware counsel to the trust and us. EXPERTS The consolidated financial statements of DPL Inc. incorporated in this prospectus by reference to the Annual Report on Form 10-K for the year ended December 31, 2000 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, independent accountants, given on the authority of said firm as experts in auditing and accounting. 50 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Article VII of the Code of Regulations of DPL provides for indemnification of directors, officers, employees or agents of DPL, or individuals who server at the request of DPL in such capacities for other entities, against any and all expenses, judgments, fines and settlements incurred by them in connection with claims and/or litigation arising out of their service. Article VII provides that indemnification shall be available to the full extent permitted by law including, without limitation, Section 1701.13(E) of the Ohio Revised Code. Under Ohio law, the liabilities against which a director or officer may be indemnified and factors employed to determine whether a director or officer is entitled to indemnification in a particular instance depend on whether the proceeding in which the claim for indemnification arises was brought (a) other than by and in the right of the corporation ("Category A Proceedings") or (b) by and in the right of the corporation ("Category B Proceedings"). In Category A Proceedings, a corporation may indemnify each director and officer against expenses, including attorneys' fees, judgements, fines, penalties, and amounts paid in settlement actually and reasonably incurred by him in connection with any threatened or actual proceeding in which he may be involved by reason of his having acted in such capacity, if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and with respect to any criminal action or proceeding, he had no reasonable cause to believe that his conduct was unlawful. In Category B Proceedings, a corporation may indemnify each director and officer against expenses, including attorneys' fees, actually and reasonably incurred by him in connection with the defense or settlement of any such proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification is permitted with respect to (i) any matter as to which such person has been adjudged to be liable for negligence or misconduct in the performance of his duty to the corporation unless a court determines such person is entitled to indemnification; or (ii) any matter in which the only liability asserted against a director or officer relates to an unlawful loan, dividend, distribution of assets or purchase or redemption of shares. Unless indemnification is ordered by a court, the determination as to whether or not an individual has satisfied the applicable standards of conduct (and therefore may be indemnified) is made by the corporation by a majority vote of a quorum consisting of directors of the corporation who were not parties to the action; or if such a quorum is not obtainable, or if a majority vote of a quorum of disinterested directors so directs, by independent legal counsel in a written opinion; or by the shareholders of the corporation; or by the court in which such action was brought. Article VII does not limit in any way other indemnification rights to which those seeking indemnification may be entitled. Ohio law requires indemnification against expenses where a directors or officer is successful on the merits or otherwise in defense of any action. Consistent with Ohio law, Article VII provides that expenses incurred by a director or officer in defending any action may be paid by DPL in advance of final disposition, upon receipt of an undertaking to repay such amount unless it is ultimately determined that he is entitled to indemnification pursuant to Article VII. DPL maintains insurance policies covering its officers and directors against certain civil liabilities, including liabilities under the Securities Act of 1933, as amended. ITEM 21. EXHIBITS Reference is made to the Exhibit Indix on page II-5 hereto. ITEM 22. UNDERTAKINGS Each undersigned registrant hereby undertakes: (1) That, for purposes of determining any liability under the Securities Act, each filing of the registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in this registration statement shall be deemed to be a new registration statement relating to the securities herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; (2) To respond to requests for information that is incorporated by reference into the prospectus pursuant to item 4,10(b), 11 or 13 of Form S-4, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of this registration statement through the date of responding to the request. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other that the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of such registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. II-2 POWER OF ATTORNEY Each director and/or officer of the registrant whose signature appears below hereby appoints each of the Agents for Service named in this registration statement as his attorney-in-fact to sign in his name and behalf, in any and all capacities stated below, and to file with the Securities and Exchange Commission, any and all amendments, including post-effective amendments, to this registration statement, and the registrant hereby also appoints each of the Agents for Service as its attorney-in-fact with like authority to sign and file any such amendments in its name and behalf. SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrants each certify that it has reasonable grounds to believe that it meets all the requirements for filing on Form S-4, and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Dayton, and State of Ohio, on the 4th day of December, 2001. DPL Inc. By /s/A.M. Hill ---------------------------------- A. M. Hill President and Chief Executive Officer DPL CAPITAL TRUST II By /s/A.M. Hill ---------------------------------- A.M. Hill Administrative Trustee By /s/S.F. Koziar, Jr. ---------------------------------- S.F. Koziar, Jr. Administrative Trustee Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed below by or on behalf of the following persons in the capacities indicated on the 4th day of December, 2001. Signature Title --------- ----- /s/T.J. Danis --------------------------- T.J. Danis Director /s/J.F. Dicke, II --------------------------- J.F. Dicke, II Director /s/P.H. Forster --------------------------- P.H. Forster Director and Chairman /s/E. Green --------------------------- E. Green Director II-3 Signature Title --------- ----- /s/J.G. Haley --------------------------- J.G. Haley Director /s/A.M. Hill --------------------------- A.M. Hill Director, President and Chief Executive Officer (principal executive officer) W A. Hillenbrand --------------------------- W A. Hillenbrand Director /s/D.R. Holmes --------------------------- D.R. Holmes Director /s/E.M. McCarthy Officer --------------------------- Group Vice President and Chief E.M. McCarthy Officer Chief Financial (principal financial and accounting officer) /s/B.R. Roberts --------------------------- B.R. Roberts Director --------------------------- G.R. Roberts Director --------------------------- S.M. Stuart Director II-4 EXHIBIT INDEX Exhibit No. Document ----------- -------- 4(a) Indenture dated as of August 31, 2001 between DPL Inc. and The Bank of New York, Trustee. 4(b) First Supplemental Indenture dated as of August 31, 2001 relating to the subordinated debentures between DPL Inc. and The Bank of New York. 4(c) Amended and Restated Trust Agreement dated as of August 31, 2001 relating to DPL Capital Trust II, the Capital Securities and the Common Securities among DPL Inc., the depositor, The Bank of New York, as property trustee, The Bank of New York (Delaware), as Delaware trustee, and Allen M. Hill and Stephen F. Koziar, Jr., as administrative trustees, and the holders, from time to time, of undivided beneficial interests in DPL Capital Trust II. 4(d) Exchange and Registration Rights Agreement dated as of August 24, 2001 among DPL Inc., DPL Capital Trust II and Morgan Stanley & Co., Incorporated. 4(e) Form of Certificate of Junior Subordinated Debentures. 4(f) Form of Capital Security Certificate for DPL Capital Trust II. 4(g) Form of Capital Securities Guarantee Agreement between DPL Inc. and The Bank of New York, as guarantee trustee relating to the Guarantee to be delivered for the benefit of the holders of the Capital Securities. 4(h) Agreement as to Expenses and Liabilities dated as of August 31, 2001 between DPL Inc. and DPL Capital Trust II. 5(a) Opinion of Mr. Koziar, Group Vice President and General Counsel of DPL Inc., as to Junior Subordinated Debentures and DPL Inc. Guarantee. 5(b) Opinion of Morris, Nichols, Arsht & Tunnel as to Capital Securities. 5(c) Opinion of Thelen Reid & Priest LLP as to Junior Subordinated Debentures and DPL Inc. Guarantee. 8 Opinion of Thelen Reid & Priest LLP as to certain federal income tax matters (contained in their opinion filed as Exhibit 5(c). 12 Computation of Ratio of Earnings to Fixed Charges. 23(a) Consent of Mr. Koziar (contained in his opinion filed as Exhibit 5(a)). 23(b) Consent of Morris, Nichols, Arsht & Tunnell (contained in their opinion filed as Exhibit 5(b)). 23(c) Consent of Thelen Reid & Priest LLP (contained in their opinion filed as Exhibit 5(c)). 23(d) Consent of PricewaterhouseCoopers LLP. 24 Power of Attorney (included on the signature page of this registration statement) 25(a) Form T-1 Statement of Eligibility of The Bank of New York as Trustee for the Capital Securities of DPL Capital Trust II. 25(a) Form T-1 Statement of of Eligibility of The Bank of New York as Trustee for the Capital Securities of DPL Capital Trust II. 25(b) Form T-1 Statement of Eligibility of The Bank of New York as Trustee for the Junior Subordinated Debentures of DPL Capital Trust II. 25(c) Form T-1 Statement of Eligibility of The Bank of New York as Trustee for DPL Capital Trust II Guarantee with respect to the Capital Securities. 99(a) Form of Exchange Agent Agreement. 99(b) Form of Notice of Guaranteed Delivery. 99(c) Form of Letter of Transmittal. 99(d) Form of Letter to Clients. 99(e) Form of Letter to Nominees. 99(f) Form of Instructions to Registered Holder and/or Book-Entry Transfer Participant from Owner. II-5 EX-4 3 e430891v1.txt EXHIBIT 4(A) ================================================================================ EXHIBIT 4(A) DPL INC. AND THE BANK OF NEW YORK TRUSTEE --------------------- INDENTURE DATED AS OF AUGUST 31, 2001 JUNIOR SUBORDINATED DEBENTURES ================================================================================ Reconciliation and Tie Sheet* between Provisions of the Trust Indenture Act of 1939, as amended and Indenture Dated as of August 31, 2001 between DPL Inc. and The Bank of New York, Trustee Section of Act Section of Indenture - -------------- -------------------- 310(a)(1) 7.09 310(a)(2) 7.09 310(a)(3) Inapplicable 310(a)(4) Inapplicable 310(b) 7.08, 7.10 310(c) Inapplicable 311(a) 7.13(a), 7.13(c) 311(b) 7.13(b), 7.13(c) 311(c) Inapplicable 312(a) 5.01, 5.02(a) 312(b) 5.02(b) 312(c) 5.03(c) 313(a) 5.04(a) 313(b)(1) Inapplicable 313(b)(2) 5.04(b) 313(c) 5.04(c) 313(d) 5.04(d) 314(a)(1) 5.03(a) 314(a)(2) 5.03(b) 314(a)(3) 5.03(c) 314(a)(4) 4.06 314(b) Inapplicable 314(c)(1) 16.04 314(c)(2) 16.04 314(c)(3) Inapplicable 314(d) Inapplicable 314(e) 16.04 314(f) Omitted 315(a) 7.01 315(b) 6.07 315(c) 7.01 315(d) 7.01 315(e) 6.08 316(a)(1) 6.06, 8.04 316(a)(2) Omitted i 316(b) 6.04 316(c) 10.05 317(a) 6.02 317(b) 4.04 318(a) 15.06 - ------------------------ * This Reconciliation and Tie Sheet is not part of the Indenture. ii TABLE OF CONTENTS Page ---- ARTICLE I DEFINITIONS Section 1.01 Certain Terms Defined...........................................1 Act.............................................................2 Additional Interest.............................................2 Additional Tax Sums.............................................2 Administrative Trustee..........................................2 applicants......................................................2 Authenticating Agent............................................2 Authorized Newspaper............................................3 Board of Directors..............................................3 Business Day....................................................3 Capital Securities..............................................3 Capital Stock...................................................3 Commission......................................................3 Common Securities...............................................4 Common Stock....................................................4 Company.........................................................4 Depositary......................................................4 Distributions...................................................4 DPL Guarantee...................................................4 DPL Trust.......................................................4 Event of Default................................................4 Exchange Act....................................................5 Extension Period................................................5 Government Securities...........................................5 Guarantee Agreement.............................................5 Indenture.......................................................5 Investment Company Event........................................5 Maturity........................................................5 1940 Act........................................................5 Officers' Certificate...........................................6 Opinion of Counsel..............................................6 Original Issue Date.............................................6 Original Issue Discount Security................................6 Paying Agent....................................................6 Person..........................................................6 Preferred Securities............................................7 principal.......................................................7 Property Trustee................................................7 i Ranking junior to the Securities................................7 Ranking on a parity with the Securities.........................7 record date.....................................................7 Register........................................................8 Resolution of the Company.......................................8 Responsible Officer.............................................8 Rights Plan.....................................................8 Security or Securities; outstanding.............................8 Securityholder; registered holder...............................9 Senior Indebtedness of the Company..............................9 Stated Maturity.................................................9 Subsidiary.....................................................10 Tax Event......................................................10 Trust Agreement................................................10 Trustee; Principal Office of the Trustee.......................10 Trust Indenture Act of 1939....................................11 Trust Securities...............................................11 ARTICLE II ISSUE, DESCRIPTION, EXECUTION, REGISTRATION OF TRANSFER AND EXCHANGE OF SECURITIES Section 2.01 Amount, Series and Delivery of Securities......................11 Section 2.02 Form of Securities and Trustee's Certificate...................15 Section 2.03 Denominations of and Payment of Interest on Securities.........17 Section 2.04 Execution of Securities........................................17 Section 2.05 Registration, Transfer and Exchange of Securities..............18 Section 2.06 Temporary Securities...........................................20 Section 2.07 Mutilated, Destroyed, Lost or Stolen Securities................20 Section 2.08 Cancellation and Destruction of Surrendered Securities.........21 Section 2.09 Authenticating Agents..........................................21 Section 2.10 Deferrals of Interest Payment Dates............................23 Section 2.11 Right of Set-Off...............................................24 Section 2.12 Shortening or Extension of Stated Maturity.....................24 Section 2.13 Agreed Tax Treatment...........................................25 Section 2.14 CUSIP Numbers..................................................25 ARTICLE III REDEMPTION OF SECURITIES Section 3.01 Applicability of Article.......................................25 Section 3.02 Mailing of Notice of Redemption................................25 Section 3.03 When Securities Called for Redemption Become Due and Payable...26 ii ARTICLE IV PARTICULAR COVENANTS OF THE COMPANY Section 4.01 Payment of Principal of and Interest on Securities.............27 Section 4.02 Maintenance of Offices or Agencies for Registration of Transfer, Exchange and Payment of Securities...................28 Section 4.03 Appointment to Fill a Vacancy In The Office of Trustee.........28 Section 4.04 Duties of Paying Agent.........................................28 Section 4.05 Further Assurances.............................................29 Section 4.06 Officers' Certificate As to Defaults; Notices of Certain Defaults...............................................29 Section 4.07 Waiver of Covenants............................................29 Section 4.08 Additional Tax Sums............................................30 Section 4.09 Additional Covenants...........................................30 Section 4.10 Calculation of Original Issue Discount.........................31 ARTICLE V SECURITYHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE Section 5.01 Company to Furnish Trustee Information As to The Names and Addresses of Securityholders...............................31 Section 5.02 Trustee to Preserve Information As to The Names and Addresses of Securityholders Received By It....................32 Section 5.03 Annual and Other Reports to Be Filed By Company With Trustee...33 Section 5.04 Trustee to Transmit Annual Report to Securityholders...........33 ARTICLE VI REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT Section 6.01 Events of Default Defined......................................35 Section 6.02 Covenant of Company to Pay to Trustee Whole Amount Due On Securities On Default In Payment of Interest or Principal...37 Section 6.03 Application of Moneys Collected By Trustee.....................39 Section 6.04 Limitation On Suits By Holders of Securities...................40 Section 6.05 On Event of Default Trustee May Take Appropriate Action........40 Section 6.06 Rights of Holders of Majority In Principal Amount of Securities to Direct Trustee and to Waive Default..............41 Section 6.07 Trustee to Give Notice of Defaults Known to It, But May Withhold In Certain Circumstances..............................41 Section 6.08 Requirement of An Undertaking to Pay Costs In Certain Suits Under The Indenture or Against The Trustee...............42 iii ARTICLE VII CONCERNING THE TRUSTEE Section 7.01 Upon Event of Default Occurring and Continuing, Trustee Shall Exercise Powers Vested In It, and Use Same Degree of Care and Skill In Their Exercise, As A Prudent Man Would Use........42 Section 7.02 Reliance On Documents, Opinions, Etc...........................44 Section 7.03 Trustee Not Liable for Recitals In Indenture or In Securities..................................................45 Section 7.04 May Hold Securities............................................45 Section 7.05 Moneys Received By Trustee to Be Held In Trust Without Interest.......................................................45 Section 7.06 Trustee Entitled to Compensation, Reimbursement and Indemnity..46 Section 7.07 Right of Trustee to Rely On Officers' Certificate Where No Other Evidence Specifically Prescribed.........................46 Section 7.08 Disqualification; Conflicting Interests........................47 Section 7.09 Requirements for Eligibility of Trustee........................47 Section 7.10 Resignation and Removal of Trustee.............................47 Section 7.11 Acceptance By Successor Trustee................................48 Section 7.12 Successor to Trustee By Merger, Consolidation or Succession to Business.........................................50 Section 7.13 Limitations On Rights of Trustee As A Creditor to Obtain Payment of Certain Claims Within Three Months Prior to Default or During Default, or to Realize On Property As Such Creditor Thereafter............................................50 ARTICLE VIII CONCERNING THE SECURITYHOLDERS Section 8.01 Evidence of Action By Securityholders..........................54 Section 8.02 Proof of Execution of Instruments and of Holding of Securities.....................................................54 Section 8.03 Who May Be Deemed Owners of Securities.........................54 Section 8.04 Securities Owned By Company or Controlled or Controlling Persons Disregarded for Certain Purposes.......................55 Section 8.05 Instruments Executed By Securityholders Bind Future Holders....55 ARTICLE IX SECURITYHOLDERS' MEETINGS Section 9.01 Purposes for Which Meetings May Be Called.....................56 Section 9.02 Manner of Calling Meetings.....................................56 Section 9.03 Call of Meeting By Company or Securityholders..................56 Section 9.04 Who May Attend and Vote At Meetings............................57 Section 9.05 Regulations May Be Made By Trustee.............................57 Section 9.06 Manner of Voting At Meetings and Record to Be Kept.............58 Section 9.07 Exercise of Rights of Trustee, Securityholders and Holders of Preferred Securities Not to Be Hindered or Delayed..........58 iv ARTICLE X SUPPLEMENTAL INDENTURES Section 10.01 Purposes for Which Supplemental Indentures May Be Entered Into Without Consent of Securityholders........................58 Section 10.02 Modification of Indenture With Consent of Holders of A Majority In Principal Amount of Securities.....................60 Section 10.03 Effect of Supplemental Indentures..............................61 Section 10.04 Securities May Bear Notation of Changes By Supplemental Indentures.....................................................62 Section 10.05 Revocation and Effect of Consents..............................62 ARTICLE XI CONSOLIDATION, MERGER, SALE OR CONVEYANCE Section 11.01 Company May Consolidate, Etc. On Certain Terms.................62 Section 11.02 Successor Corporation Substituted..............................63 Section 11.03 Opinion of Counsel to Trustee..................................63 ARTICLE XII SATISFACTION AND DISCHARGE OF INDENTURE, UNCLAIMED MONEYS Section 12.01 Satisfaction and Discharge of Indenture........................63 Section 12.02 Application By Trustee of Funds Deposited for Payment of Securities..................................................64 Section 12.03 Repayment of Moneys Held By Paying Agent.......................64 Section 12.04 Repayment of Moneys Held By Trustee............................64 ARTICLE XIII IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS, DIRECTORS AND EMPLOYEES Section 13.01 Incorporators, Stockholders, Officers, Directors and Employees of Company Exempt From Individual Liability..........65 ARTICLE XIV SUBORDINATION OF SECURITIES Section 14.01 Agreement to Subordinate.......................................65 Section 14.02 Obligation of The Company Unconditional........................67 Section 14.03 Limitations On Duties to Holders of Senior Indebtedness of The Company....................................................67 v Section 14.04 Notice to Trustee of Facts Prohibiting Payment.................68 Section 14.05 Application By Trustee of Moneys Deposited With It.............68 Section 14.06 Subrogation....................................................68 Section 14.07 Subordination Rights Not Impaired By Acts or Omissions of Company or Holders of Senior Indebtedness of The Company.......69 Section 14.08 Authorization of Trustee to Effectuate Subordination of Securities.....................................................69 Section 14.09 No Payment When Senior Indebtedness In Default.................69 Section 14.10 Right of Trustee to Hold Senior Indebtedness of The Company....70 Section 14.11 Article XIV Not to Prevent Defaults............................70 ARTICLE XV LEGAL DEFEASANCE AND COVENANT DEFEASANCE Section 15.01 Option to Effect Legal Defeasance or Covenant Defeasance.......70 Section 15.02 Legal Defeasance and Discharge.................................70 Section 15.03 Covenant Defeasance............................................71 Section 15.04 Conditions to Legal or Covenant Defeasance.....................71 Section 15.05 Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous Provisions..........................72 Section 15.06 Repayment to Company...........................................73 Section 15.07 Reinstatement..................................................73 ARTICLE XVI MISCELLANEOUS PROVISIONS Section 16.01 Successors and Assigns of Company Bound By Indenture...........73 Section 16.02 Acts of Board, Committee or Officer of Successor Corporation Valid..........................................................73 Section 16.03 Required Notices or Demands May Be Served By Mail..............74 Section 16.04 Officers' Certificate and Opinion of Counsel to Be Furnished Upon Applications or Demands By The Company....................74 Section 16.05 Payments Due On Saturdays, Sundays, and Holidays...............75 Section 16.06 Provisions Required By Trust Indenture Act of 1939 to Control..75 Section 16.07 Indenture and Securities to Be Construed In Accordance With The Laws of The State of New York..............................75 Section 16.08 Provisions of The Indenture and Securities for The Sole Benefit of The Parties and The Securityholders.................75 Section 16.09 Indenture May Be Executed In Counterparts......................75 Section 16.10 Securities In Foreign Currencies...............................76 vi THIS INDENTURE, dated as of the 31st day of August, 2001 between DPL INC., a corporation duly organized and existing under the laws of the State of Ohio (hereinafter sometimes referred to as the "COMPANY"), party of the first part, and THE BANK OF NEW YORK, a New York banking corporation (hereinafter sometimes referred to as the "TRUSTEE"), party of the second part. WITNESSETH: WHEREAS, for its lawful corporate purposes, the Company has duly authorized the issuance from time to time of its unsecured junior subordinated debentures or other evidences of indebtedness (hereinafter referred to as the "SECURITIES"), without limit as to principal amount, issuable in one or more series, the amount and terms of each such series to be determined as hereinafter provided, including, without limitation, Securities issued to evidence loans made to the Company of the proceeds from the issuance from time to time by one or more business trusts (each a "DPL TRUST," and collectively, the "DPL TRUSTS") of preferred interests in such Trusts (the "PREFERRED SECURITIES" which may also be referred to, without limitation, as the "CAPITAL SECURITIES") and common interests in such Trusts (the "COMMON SECURITIES," and collectively with the Preferred Securities, the "TRUST SECURITIES"); to be authenticated by the certificate of the Trustee; and, to provide the terms and conditions upon which the Securities are to be authenticated, issued and delivered, the Company has duly authorized the execution of this Indenture; and WHEREAS, all acts and things necessary to make the Securities when executed by the Company and authenticated and delivered by the Trustee as in this Indenture provided, the valid, binding and legal obligations of the Company, and to constitute these presents a valid indenture and agreement according to its terms, have been done and performed and the execution of this Indenture and the issue hereunder of the Securities have in all respects been duly authorized, and the Company, in the exercise of the legal rights and power vested in it, executes this Indenture and proposes to make, execute, issue and deliver the Securities; NOW, THEREFORE, in order to declare the terms and conditions upon which the Securities are authenticated, issued and delivered, and in consideration of the premises and of the purchase and acceptance of the Securities by the holders thereof, the Company covenants and agrees with the Trustee, for the equal and proportionate benefit of the respective holders from time to time of the Securities or of series thereof, as follows: ARTICLE I DEFINITIONS ----------- Section 1.01 Certain Terms Defined. For all purposes of this Indenture, --------------------- except as otherwise expressly provided or unless the context otherwise requires: (a) The terms defined in this Article have the meanings assigned to them in this Article, and include the plural as well as the singular; (b) All other terms used herein which are defined in the Trust Indenture Act of 1939, whether directly or by reference therein, have the meanings assigned to them therein; (c) All accounting terms used herein and not expressly defined herein shall have the meanings assigned to them in accordance with generally accepted accounting principles in the United States of America, and, except as otherwise herein expressly provided, the term "generally accepted accounting principles" with respect to any computation required or permitted hereunder shall mean such accounting principles as are generally accepted in the United States of America at the date of such computation; provided, that when two or more principles are so generally accepted, it shall mean that set of principles consistent with those in use by the Company; and (d) The terms "herein," "hereof" and "hereunder" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision. Act: The term "ACT" has the meaning specified in SECTION 2.01. Additional Interest: The term "ADDITIONAL INTEREST" means the interest, if any, that shall accrue on any interest on the Securities of any series the payment of which has not been made on the applicable interest payment date and which shall accrue at the rate per annum specified or determined as specified in such Security. Additional Tax Sums: The term "ADDITIONAL TAX SUMS" has the meaning specified in SECTION 4.08. Administrative Trustee: The term "ADMINISTRATIVE TRUSTEE" means, in respect of any DPL Trust, each Person identified as an "ADMINISTRATIVE TRUSTEE" in the related Trust Agreement, solely in such Person's capacity as Administrative Trustee of such DPL Trust under such Trust Agreement and not in such Person's individual capacity, or any successor administrative trustee appointed as therein provided. applicants: The term "APPLICANTS" has the meaning specified in SECTION 5.02(B). Authenticating Agent: The term "AUTHENTICATING AGENT" means any Authenticating Agent appointed by the Trustee pursuant to SECTION 2.09. 2 Authorized Newspaper: The term "AUTHORIZED NEWSPAPER" means a newspaper in the City of Dayton, State of Ohio, and the Borough of Manhattan, The City of New York, State of New York, each of which is printed in the English language and customarily published at least once a day for at least five days in each calendar week and of general circulation in the respective cities. Whenever successive publications are required to be made in an Authorized Newspaper, the successive publications may be made in the same or in a different newspaper meeting the foregoing requirements and in each case on any day of the week. If it is impossible or, in the opinion of the Trustee, impracticable to publish any notice in the manner herein provided, then such publication in lieu thereof as shall be made with the approval of the Trustee shall constitute a sufficient publication of such notice. Board of Directors: The term "BOARD OF DIRECTORS," when used with reference to the Company, means the Board of Directors of the Company or the Executive Committee or any other committee of or created by the Board of Directors of the Company duly authorized to act hereunder. Business Day: The term "BUSINESS DAY" means any day which is not a Saturday or Sunday and which is neither a legal holiday nor a day on which banking institutions in The City of New York are authorized or required by law or executive order to close or a day on which the principal corporate trust office of the Trustee is closed for business. Capital Securities: The term "CAPITAL SECURITIES" has the meaning specified in the recitals to this Indenture. Capital Stock: The term "CAPITAL STOCK" means shares of capital stock of any class of any corporation whether now or hereafter authorized regardless of whether such capital stock shall be limited to a fixed sum or percentage in respect of the rights of the holders thereof to participate in dividends and in the distribution of assets upon any voluntary or involuntary liquidation, dissolution or winding up. Commission: The term "COMMISSION" means the Securities and Exchange Commission, as from time to time constituted, created under the Securities Exchange Act of 1934, as amended, or, if at any time after the execution of this instrument such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act of 1939, then the body performing such duties on such date. 3 Common Securities: The term "COMMON SECURITIES" has the meaning specified in the recitals to this Indenture. Common Stock: The term "COMMON STOCK" means the common stock, par value $.01 per share, of the Company. Company: The term "COMPANY" means DPL Inc., a corporation duly organized and existing under the laws of the State of Ohio and, subject to the provisions of Article XI, shall also include its successors and assigns. Depositary: The term "DEPOSITARY" means, with respect to the Securities of any series issuable or issued in whole or in part in the form of one or more global Securities, the person designated as Depositary by the Company pursuant to SECTION 2.01 until a successor Depositary shall have become such pursuant to the applicable provisions of this Indenture, and thereafter the term "DEPOSITARY" shall mean or include each person who is then a Depositary hereunder and if at any time there is more than one such person, the term "DEPOSITARY" as used with respect to the Securities of any series shall mean the Depositary with respect to the Securities of such series. Distributions: The term "DISTRIBUTIONS," with respect to the Trust Securities issued by a DPL Trust, means amounts payable in respect of such Trust Securities as provided in the related Trust Agreement and referred to therein as "DISTRIBUTIONS." DPL Guarantee: The term "DPL GUARANTEE" means the guarantee by the Company of distributions on the Preferred Securities or the Capital Securities of a DPL Trust to the extent provided in the Guarantee Agreement. DPL Trust: The terms "DPL TRUST" and "DPL TRUSTS" each have the meaning specified in the recitals to this Indenture. Event of Default: The term "EVENT OF DEFAULT" with respect to Securities of any series shall mean any event specified as such in SECTION 6.01 and any other event as may be established with respect to the Securities of such series as contemplated by SECTION 2.01. 4 Exchange Act: The term "EXCHANGE ACT" has the meaning specified in SECTION 2.02. Extension Period: The term "EXTENSION PERIOD" has the meaning specified in SECTION 2.10. Government Securities: The term "GOVERNMENT SECURITIES" means direct obligations of, or obligations guaranteed by, the United States of America, and the payment for which the United States pledges its full faith and credit. Guarantee Agreement: The term "GUARANTEE AGREEMENT" means any Guarantee Agreement relating to any Preferred Securities or Capital Securities of any DPL Trust, whether now existing or created in the future. Indenture: The term "INDENTURE" means this instrument as originally executed, or, if amended or supplemented as herein provided, then as so amended or supplemented, and shall include the form and terms of particular series of Securities established as contemplated by SECTIONS 2.01 and 2.02. Investment Company Event: The term "INVESTMENT COMPANY EVENT" means, in respect of a DPL Trust, the receipt by a DPL Trust of an Opinion of Counsel to the effect that, as a result of the occurrence of a change in law or regulation or a written change in interpretation or application of law or regulation by any legislative body, court, governmental agency or regulatory authority (a "CHANGE IN 1940 ACT LAW"), such DPL Trust is or will be considered an investment company that is required to be registered under the 1940 Act, which Change in 1940 Act Law becomes effective on or after the date of original issuance of the Preferred Securities of such DPL Trust. Maturity: The term "MATURITY" when used with respect to any Security means the date on which the principal of such Security becomes due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise. 1940 Act: The term "1940 ACT" means the Investment Company Act of 1940, as amended. 5 Officers' Certificate: The term "OFFICERS' CERTIFICATE" shall mean a certificate signed by the Chairman of the Board, any Vice Chairman of the Board, the Chief Executive Officer, the President, any Vice Chairman or any Vice President of the Company (whether or not designated by a number or a word or words added before or after the title Vice President) and by the Treasurer, an Assistant Treasurer, the Controller, the Secretary or an Assistant Secretary of the Company and delivered to the Trustee. Each such certificate shall include the statements provided for in SECTION 16.04, if and to the extent required by the provisions thereof and will comply with Section 314 of the Trust Indenture Act of 1939. Opinion of Counsel: The term "OPINION OF COUNSEL" shall mean an opinion in writing signed by legal counsel, who shall be satisfactory to the Trustee, and who may be an employee of, or counsel to, the Company and delivered to the Trustee; provided however, that for purposes of the definitions of "Tax Event" and "Investment Company Event" contained herein, SECTION 2.12, SECTION 10.01(A), SECTION 11.01 and SECTION 15.04(B) and (C), such opinion shall be by nationally recognized independent legal counsel experienced in the matters related to the substance of the opinion. Each such opinion shall include the statements provided for in SECTION 16.04, if and to the extent required by the provisions thereof, and will comply with Section 314 of the Trust Indenture Act of 1939. Original Issue Date: The term "ORIGINAL ISSUE DATE" means the first date of issuance of each Security. Original Issue Discount Security: The term "ORIGINAL ISSUE DISCOUNT SECURITY" shall mean any Security that provides for an amount less than the principal amount thereof to be due and payable upon declaration pursuant to SECTION 6.01. Paying Agent: The term "PAYING AGENT" means the Trustee or any Person or Persons authorized by the Company to pay the principal or interest on any Securities on behalf of the Company. Person: The term "PERSON" or "PERSON" means any individual, corporation, estate, partnership, joint venture, association, joint stock company, limited liability company, trust, unincorporated association or government or any agency or political subdivision thereof, or any other entity of whatever nature. 6 Preferred Securities: The term "PREFERRED SECURITIES" has the meaning specified in the recitals to this Indenture. principal: The term "PRINCIPAL," whenever used with reference to the Securities or any Security or any portion thereof, shall be deemed to include "and premium, if any." Property Trustee: The term "PROPERTY TRUSTEE" means, in respect of any DPL Trust, the commercial bank or trust company identified as the "Property Trustee" in the related Trust Agreement, solely in its capacity as Property Trustee of such DPL Trust under such Trust Agreement and not in its individual capacity, or its successor in interest in such capacity, or any successor property trustee appointed as therein provided. Ranking junior to the Securities: The term "RANKING JUNIOR TO THE SECURITIES," or correlative phrases, when used with respect to any obligation of the Company means (i) any DPL Guarantee, and (ii) any other obligation of the Company which (a) ranks junior to and not equally with or prior to the Securities (or any other obligations of the Company ranking on a parity with the Securities) in right of payment upon the happening of any event of the kind specified in the first sentence of the first paragraph of SECTION 14.01, or (b) is specifically designated as ranking junior to the Securities by express provision in the instrument creating or evidencing such obligation. The securing of any obligations of the Company, otherwise ranking junior to the Securities, shall be deemed to prevent such obligations from constituting obligations ranking junior to the Securities. Ranking on a parity with the Securities: The term "RANKING ON A PARITY WITH THE SECURITIES," or correlative phrases, when used with respect to any obligation of the Company means any obligation of the Company which (a) ranks equally with and not prior to the Securities in right of payment upon the happening of any event of the kind specified in the first sentence of the first paragraph of SECTION 14.01, or (b) is specifically designated as ranking on a parity with the Securities by express provision in the instrument creating or evidencing such obligation. The securing of any obligations of the Company, otherwise ranking on a parity with the Securities, shall not be deemed to prevent such obligations from constituting obligations ranking on a parity with the Securities. record date: The term "RECORD DATE" has the meaning specified in SECTION 2.03. 7 Register: The term "REGISTER" has the meaning specified in SECTION 2.05. Resolution of the Company: The term "RESOLUTION OF THE COMPANY" means a resolution of the Company, in the form of a resolution of the Board of Directors, in the form of a resolution of a duly constituted committee of the Board of Directors, or in the form of a resolution of two or more senior officers of the Company, authorizing, ratifying, setting forth or otherwise validating agreements, execution and delivery of documents, the issuance, form and terms of Securities, or any other actions or proceedings pursuant or with respect to this Indenture. Responsible Officer: The term "RESPONSIBLE OFFICER," when used with respect to the Trustee, means any officer of the Trustee with direct responsibility for the administration of this Indenture and also means, with respect to a particular corporate trust matter, any other officer of the Trustee to whom such matter is referred by the Trustee because of his knowledge of, and familiarity with, a particular subject. Rights Plan: The term "RIGHTS PLAN" means a plan of the Company providing for the issuance by the Company to all holders of its Common Stock of rights entitling the holders thereof to subscribe for or purchase shares of Common Stock or any class or series of preferred stock, which rights (i) are deemed to be transferred with such shares of Common Stock, (ii) are not exercisable and (iii) are also issued in respect of future issuances of Common Stock, in each case until the occurrence of a specified event or events. Security or Securities; outstanding: The term "SECURITY" or "SECURITIES" means any security or securities of the Company, as the case may be, without regard to series, authenticated and delivered under this Indenture. The term "OUTSTANDING," when used with reference to Securities and subject to the provisions of SECTION 8.04, means as of any particular time, all Securities authenticated and delivered by the Trustee under this Indenture, except (a) Securities theretofore cancelled by the Trustee or delivered to the Trustee for cancellation; (b) Securities, or portions thereof, for the payment or redemption of which moneys in the necessary amount shall have been deposited in trust with the Trustee or with any Paying Agent (other than the Company) or shall have been set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent); provided that such Securities shall have reached their Stated Maturity or, if such Securities are to be redeemed prior to the Stated Maturity thereof, notice of such redemption 8 shall have been given as in Article III provided, or provision satisfactory to the Trustee shall have been made for giving such notice; and (c) Securities in lieu of or in substitution for which other Securities shall have been authenticated and delivered or which have been paid pursuant to the terms of SECTION 2.07 unless proof satisfactory to the Trustee is presented that any such Securities are held by persons in whose hands any of such Securities is a valid, binding and legal obligation of the Company. In determining whether the holders of the requisite principal amount of outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, the principal amount of an Original Issue Discount Security that shall be deemed to be outstanding for such purposes shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon a declaration of acceleration of the Maturity thereof pursuant to SECTION 6.01. Securityholder; registered holder: The terms "SECURITYHOLDER," "HOLDER OF SECURITIES," "REGISTERED HOLDER" or other similar term, mean any person who shall at the time be the registered holder of any Security or Securities on the Register kept for that purpose in accordance with the provisions of this Indenture. Senior Indebtedness of the Company: The term "SENIOR INDEBTEDNESS OF THE COMPANY" means the principal of, and premium, if any, and interest, if any (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization of the Company, and including any rate of interest applicable upon default, whether or not such claim for post-petition interest is allowed in such proceeding) on (i) any indebtedness of the Company for borrowed money, whether or not evidenced by bonds, debentures, notes or other written instruments, (ii) obligations under letters of credit, (iii) any indebtedness or other obligations of the Company with respect to commodity contracts, interest rate and currency swap agreements, cap, floor and collar agreements, currency spot and forward contracts, and other similar agreements or arrangements designed to protect against fluctuations in currency exchange or interest rates, and (iv) any guarantees, endorsements (other than by endorsement of negotiable instruments for collection in the ordinary course of business) or other similar contingent obligations in respect of obligations of others of a type described in (i), (ii) or (iii) above whether or not such obligation is classified as a liability on a balance sheet prepared in accordance with generally accepted accounting principles, in each case listed in (i), (ii), (iii) and (iv) above whether outstanding on the date of execution of this Indenture or thereafter incurred, other than obligations ranking on a parity with the Securities or ranking junior to the Securities; provided, however, that "Senior Indebtedness of the Company" does not include trade creditors. Stated Maturity: The term "STATED MATURITY" when used with respect to any Security or any installment of principal thereof or interest thereon means the date specified pursuant to the terms of such Security as the date on which the principal of 9 such Security or such installment of interest is due and payable in the case of such principal, as such date may be shortened or extended or provided pursuant to the terms of such Security and this Indenture. Subsidiary: The term "SUBSIDIARY" means a corporation more than 50% of the outstanding voting stock of which is owned, directly or indirectly, by the Company or by one or more other Subsidiaries, or by the Company and one or more other Subsidiaries. For the purposes of this definition, "voting stock" means stock which ordinarily has voting power for the election of directors, whether at all times or only so long as no senior class of stock has such voting power by reason of any contingency. Tax Event: The term "TAX EVENT" means the receipt by the Company and a DPL Trust of an Opinion of Counsel experienced in such matters to the effect that, as a result of any amendment to, or change (including any announced prospective change) in, the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein, or as a result of any official administrative written pronouncement, action or judicial decision interpreting or applying such laws or regulations, which amendment or change is effective or which proposed change, pronouncement, action or decision is announced on or after the date of issuance of the Preferred Securities of such DPL Trust, there is more than an insubstantial risk that (i) the DPL Trust is, or will be within 90 days after the date of such Opinion of Counsel, subject to United States federal income tax with respect to income received or accrued on the corresponding series of Securities issued by the Company to such DPL Trust, (ii) interest payable by the Company on such corresponding series of Securities is not, or within 90 days of the date of such Opinion of Counsel, will not be, deductible by the Company, in whole or in part, for United States federal income tax purposes, or (iii) the DPL Trust is, or will be within 90 days after the date of such Opinion of Counsel, subject to more than a de minimis amount of other taxes, duties or other governmental charges. Trust Agreement: The term "TRUST AGREEMENT" means any Trust Agreement governing any DPL Trust, whether now existing or created in the future, relating to the Securities of any series in each case. Trustee; Principal Office of the Trustee: The term "TRUSTEE" means the Person named as the "Trustee" in the first paragraph of this instrument, and, subject to the provisions of Article VII, shall also include its successors. The term "PRINCIPAL OFFICE" of the Trustee shall mean the corporate trust office of the Trustee in The City of New York, State of New York, at which the corporate trust business of the Trustee shall, at any particular time, be principally administered. The present address of the corporate trust office of the Trustee in The City of New York, State of New York office at which the corporate trust business of the Trustee is principally administered is 101 Barclay Street, Floor 21 West, New York, New York 10286, Attention: Corporate Trust Administration. 10 Trust Indenture Act of 1939: Except as herein otherwise expressly provided or unless the context requires otherwise, the term "TRUST INDENTURE ACT OF 1939" shall mean the Trust Indenture Act of 1939, as amended by the Trust Indenture Reform Act of 1990, as in force at the date as of which this Indenture was originally executed. Trust Securities: The term "TRUST SECURITIES" has the meaning specified in the recitals to this Indenture. ARTICLE II ISSUE, DESCRIPTION, EXECUTION, REGISTRATION OF TRANSFER ------------------------------------------------------- AND EXCHANGE OF SECURITIES -------------------------- Section 2.01 Amount, Series and Delivery of Securities. The aggregate ----------------------------------------- principal amount of Securities which may be authenticated and delivered under this Indenture is unlimited. The Securities may be issued in one or more series. The terms of each series (which terms shall not be inconsistent with the provisions of this Indenture) including: (1) The designation of the Securities of such series (which shall distinguish the Securities of the series from all other Securities and which shall include the word "subordinated" or a word of like meaning); (2) Any limit upon the aggregate principal amount of the Securities of such series which may be executed, authenticated and delivered under this Indenture; provided, however, that nothing contained in this Section or elsewhere in this Indenture or in such Securities or in a Resolution of the Company or Officers' Certificate or supplemental indenture is intended to or shall limit execution by the Company or authentication and delivery by the Trustee of Securities under the circumstances contemplated by SECTIONS 2.05, 2.06, 2.07, 3.02, 3.03 and 10.04; (3) The date or dates (if any) on which the principal of the Securities of such series is payable; (4) The rate or rates at which the Securities of such series shall bear interest, if any, the rate or rates and extent to which Additional Interest or other interest, if any, shall be payable, the date or dates from which such interest shall accrue, the dates on which such interest shall be payable, the record date for the interest payable on any interest payment date and the right of the Company to defer or extend an interest payment date; (5) The place or places where Securities of such series may be presented for payment and for the other purposes provided in SECTION 4.02; 11 (6) Any price or prices at which, any period or periods within which, and any terms and conditions upon which Securities of such series may be redeemed, in whole or in part, at the option of the Company; (7) The type or types (if any) of Capital Stock of the Company into which, any period or periods within which, and any terms and conditions upon which Securities of such series may be made payable, converted, exchanged in whole or in part, at the option of the holder or of the Company; (8) If other than denominations of $1,000 and any whole multiple thereof, the denominations in which Securities of such series shall be issuable; (9) If other than the principal amount thereof, the portion of the principal amount of Securities of such series which shall be payable upon declaration of acceleration of the Maturity thereof pursuant to SECTION 6.01; (10) If other than such coin or currency of the United States of America as at the time of payment is legal tender for payment of public or private debts, the coin or currency (which may be a composite currency) in which payment of the principal of (and premium, if any) and interest, if any, on the Securities of such series shall be payable; (11) If the principal of (and premium, if any) or interest, if any, on the Securities of such series are to be payable, at the election of the Company or a holder thereof, in a coin or currency (including composite currency) other than that in which the Securities of such series are stated to be payable, the period or periods within which, and the terms and conditions upon which, such election may be made; (12) If the amounts of payments of principal of (and premium, if any) or interest, if any, on the Securities of such series may be determined with reference to an index based on a coin or currency (including composite currency) other than that in which the Securities of such series are stated to be payable, the manner in which such amounts shall be determined; (13) If the Securities of such series are payable at Maturity or upon earlier redemption in Capital Stock, the terms and conditions upon which such payment shall be made; (14) The person or persons who shall be registrar for the Securities of such series, and the place or places where the Register of Securities of the series shall be kept; (15) Any Events of Default with respect to the Securities of such series, if not set forth herein; (16) Whether any Securities of such series are to be issuable in global form with or without coupons, and, if so, the Depositary for such global Securities and whether beneficial owners of interests in any such global Security may exchange such interests for definitive Securities of such series and of like tenor of any authorized form and denomination and 12 the circumstances under which, and the place or places where, any such exchanges may occur, if other than in the manner provided in SECTION 2.05; (17) The form of Trust Agreement and Guarantee Agreement, if applicable; (18) If applicable, the relative degree to which Securities of such series shall be senior to or be subordinated to other series of such Securities or other indebtedness of the Company in right of payment, whether such other series of Securities or other indebtedness are outstanding or not; and (19) Any other terms of the series (which terms shall not be inconsistent with the provisions of this Indenture); or in any case, the method for determining such terms, the persons authorized to determine such terms and the limits, if any, within which any such determination of such terms is to be made shall either be established in or pursuant to a Resolution of the Company and set forth in an Officers' Certificate, or set forth in one or more indentures supplemental hereto, prior to the issuance of Securities of any series. The Securities of all series shall be subordinate to Senior Indebtedness of the Company as provided in Article XIV. The applicable Resolution of the Company as set forth in an Officers' Certificate, or supplemental indenture, may provide that Securities of any particular series may be issued at various times, with different dates on which the principal or any installment of principal is payable, with different rates of interest, if any, or different methods by which interest may be determined, with different dates from which such interest shall accrue, with different dates on which such interest may be payable or with any different terms other than Events of Default but all such Securities of a particular series shall for all purposes under this Indenture including, but not limited to, voting and Events of Default, be treated as Securities of a single series. If any of the terms of any series of Securities are established by action taken pursuant to a Resolution of the Company, a copy of an appropriate record of such action shall be certified by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee at or prior to the delivery of the Officers' Certificate or supplemental indenture setting forth the terms of the series. At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series executed by the Company to the Trustee for authentication by it, and the Trustee shall thereupon authenticate and deliver such Securities to or upon the written order of the Company, signed by its Chairman of the Board, or its Chief Executive Officer, or its President, or any Vice Chairman or any Vice President of the Company (whether or not designated by a number or a word or words added before or after the title Vice President), and by its Treasurer or an Assistant Treasurer or its Controller or its Secretary or an Assistant Secretary, without any further corporate action by the Company. If the form or terms of the Securities of the series have been established in or pursuant to a Resolution of the Company and set forth in an Officers' Certificate, or set forth in one or more supplemental indentures hereto, as permitted by this Section and SECTION 2.02, in 13 authenticating such Securities, and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive, and (subject to SECTION 7.01) shall be fully protected in relying upon: (a) an Opinion of Counsel stating: (i) that the form and terms of such Securities have been established in conformity with the provisions of this Indenture; (ii) That the issuance and sale of such Securities have been duly registered under the Securities Act of 1933, as amended (the "ACT"), and a registration statement with respect thereto under the Act has become effective under the Act, or that such issuance and sale are exempt from the registration requirements of the Act; and that any other action by or before any governmental body or authority (except that the offer and sale of such Securities in certain jurisdictions may be subject to the Blue Sky or securities laws of such jurisdictions) required in connection with the issuance and sale of such Securities has been duly taken, specifying the nature thereof, or that no such action is required; (iii) That the issuance and delivery of such Securities does not violate the charter or code of regulations of the Company or violate any order or decree of any court or public authority having jurisdiction of which such counsel has knowledge; or result in a breach of the terms, conditions or provisions of, or constitute a default under, any mortgage, indenture, contract, agreement or undertaking known to counsel to which the Company is a party or by which it is bound; (iv) That such Securities, when executed by the Company and authenticated by the Trustee in accordance with the terms of this Indenture and delivered to the purchasers thereof against payment of the agreed consideration therefor in accordance with the terms of any purchase or similar agreement, will be entitled to the benefits of this Indenture and will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, except as may be limited by applicable bankruptcy, insolvency, fraudulent conveyance, reorganization or other similar laws affecting creditors' rights and by general equitable principles (whether considered in a proceeding in equity or at law); (v) If the terms of such Securities provide for the conversion of such Securities into shares of Capital Stock of the Company, or the payment thereof in Capital Stock upon Maturity or earlier redemption of such Securities, that the Company has reserved a sufficient number of shares of Capital Stock for issuance upon such conversion or payment, and such shares of Capital Stock, upon such issuance, will be duly and validly issued, fully paid and nonassessable; (vi) That the Company has the corporate power to issue such Securities, and has duly taken all necessary corporate action with respect to such issuance; (vii) That all laws and requirements in respect of the execution and delivery by the Company of such Securities and the related supplemental indenture, if any, have been complied with and that authentication and 14 delivery of such Securities and the execution and delivery of the related supplemental indenture, if any, by the Trustee will not violate the terms of this Indenture; and (viii) Such other matters as the Trustee may reasonably request; and (b) An Officers' Certificate setting forth the form and terms of the Securities of such series pursuant to this Section and SECTION 2.02 hereof (but only if the form and terms of the Securities of such series are not set forth in one or more supplemental indentures hereto) and stating that all conditions precedent provided for in this Indenture relating to the issuance of such Securities have been complied with, that no Event of Default with respect to any series of Securities has occurred and is continuing and that the issuance of such Securities is not and will not result in (i) an Event of Default or an event or condition which, upon the giving of notice to, or the acquisition of knowledge by, each such officer, or the lapse of time or both, would become an Event of Default or (ii) a default under the provisions of any other instrument or agreement by which the Company is bound. The Trustee shall not be required to authenticate such Securities if the issue of such Securities pursuant to this Indenture will affect the Trustee's own rights, duties or immunities under the Securities and this Indenture or otherwise in a manner which is not reasonably acceptable to the Trustee. If all the Securities of any series are not to be issued at one time, it shall not be necessary to deliver either an Opinion of Counsel or an Officers' Certificate at the time of issuance of each Security; provided that such Opinion of Counsel and Officers' Certificate, with appropriate modifications, are instead delivered at or prior to the time of issuance of the first Security of such series. Each Security shall be dated the date of its authentication. Section 2.02 Form of Securities and Trustee's Certificate. The Securities -------------------------------------------- of each series shall be substantially of the tenor and terms as shall be authorized in or pursuant to a Resolution of the Company and set forth in an Officers' Certificate, or set forth in an indenture or indentures supplemental hereto in each case with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture, and may have such letters, numbers or other marks of identification or designation and such legends or endorsements thereon as the Company may deem appropriate and as are not inconsistent with the provisions of this Indenture, or as may be required to comply with any law or with any rule or regulation made pursuant thereto or with any rule or regulation of any stock exchange or automated quotation system on which the Securities may be listed, or to conform to usage. If the form of Securities of any series is authorized by action taken pursuant to a Resolution of the Company, a copy of an appropriate record of such action shall be certified by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee at or prior to the delivery of the Officers' Certificate contemplated by SECTION 2.01 setting forth the terms of the series. The Securities may be printed, lithographed or fully or partly engraved. The Trustee's certificate of authentication shall be in substantially the following form: 15 This is one of the Securities, of the series designated herein, referred to in the within-mentioned Indenture. THE BANK OF NEW YORK, as Trustee By: ______________________________ Authorized Signatory If Securities of a series are issuable in global form, as specified pursuant to SECTION 2.01, then, notwithstanding clause (8) of SECTION 2.01 and the provisions of SECTION 2.03, such Security shall represent such of the outstanding Securities of such series as shall be specified therein and may provide that it shall represent the aggregate amount of outstanding Securities of such series from time to time endorsed thereon and that the aggregate amount of outstanding Securities of such series represented thereby may from time to time be increased or reduced to reflect exchanges or transfers. Any endorsement of a Security in global form to reflect the amount, or any increase or decrease in the amount, of outstanding Securities represented thereby shall be made by the Trustee in such manner and upon instructions given by such person or persons as shall be specified in such Security or by the Company. Subject to the provisions of SECTION 2.04 and, if applicable, SECTION 2.06, the Trustee shall deliver and redeliver any Security in global form in the manner and upon written instructions given by the person or persons specified in such Security or by the Company. Any instructions by the Company with respect to endorsement or delivery or redelivery of a Security in global form after the original issuance of the Securities of such series shall be in writing but need not comply with SECTION 16.04 and need not be accompanied by an Opinion of Counsel. Unless otherwise specified pursuant to SECTION 2.01, payment of principal of and any premium and any interest on any Security in global form shall be made to the person or persons specified therein. The owners of beneficial interests in any global Security shall have no rights under this Indenture with respect to any global Security held on their behalf by a Depositary, and such Depositary may be treated by the Company, the Trustee, and any agent of the Company or the Trustee as the sole holder and owner of such global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by a Depositary, or impair, as between a Depositary and its participants in any global Security, the operation of customary practices governing the exercise of the rights of a holder of a Security of any series, including, without limitation, the granting of proxies or other authorization of participants to give or take any request, demand, authorization, direction, notice, consent, waiver or other action that a holder is entitled to give or take under this Indenture. Neither the Company, the Trustee nor any Authenticating Agent will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests of a global Security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. 16 Each Depositary designated pursuant to SECTION 2.01 for a global Security must, at the time of its designation and at all times while it serves as Depositary, be a clearing agency registered under the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), and any other applicable statute or regulation. Section 2.03 Denominations of and Payment of Interest on Securities. The ------------------------------------------------------ Securities of each series shall be issuable as fully registered Securities without coupons in such denominations as shall be specified as contemplated by SECTION 2.01 (except as provided in SECTION 2.02 and SECTION 2.06). In the absence of any such provisions with respect to the Securities of any series, the Securities of such series shall be issuable in denominations of $1,000 and integral multiples of $1,000 in excess thereof. If the Securities of any series shall bear interest, each Security of such series shall bear interest from the applicable date at the rate or rates per annum, and such interest shall be payable on the dates, specified on, or determined in the manner provided in, the Security. The person in whose name any Security is registered at the close of business on any record date (as defined below) for the Security with respect to any interest payment date for such Security shall be entitled to receive the interest payable thereon on such interest payment date notwithstanding the cancellation of such Security upon any registration of transfer, exchange or conversion thereof subsequent to such record date and prior to such interest payment date, unless such Security shall have been called for redemption on a date fixed for redemption subsequent to such record date and prior to such interest payment date or unless the Company shall default in the payment of interest due on such interest payment date on such Security, in which case such defaulted interest shall be paid to the person in whose name such Security (or any Security or Securities issued upon registration of or exchange thereof) is registered at the close of business on the record date for the payment of such defaulted interest, or except as otherwise specified as contemplated by SECTION 2.01. The term "record date" as used in this Section with respect to any regular interest payment date for any Security shall mean such day or days as shall be specified as contemplated by SECTION 2.01; provided, however, that in the absence of any such provisions with respect to any Security, such term shall mean: (1) if such interest payment date is the first day of a calendar month, record date means the fifteenth day of the calendar month next preceding such interest payment date; or (2) if such interest payment date is the fifteenth day of a calendar month, record date means the first day of such calendar month; provided, further, that (except as otherwise specified as contemplated by SECTION 2.01) if the day which would be the record date as provided herein is not a Business Day, then it shall mean the Business Day next preceding such day. Such term, as used in this Section, with respect to the payment of any defaulted interest on any Security shall mean (except as otherwise specified as contemplated by SECTION 2.01) the fifth day next preceding the date fixed by the Company for the payment of defaulted interest, established by notice given by first class mail by or on behalf of the Company to the holder of such Security not less than 10 days preceding such record date, or, if such fifth day is not a Business Day, the Business Day next preceding such fifth day. Section 2.04 Execution of Securities. The Securities shall be signed on ----------------------- behalf of the Company, manually or in facsimile, by its Chairman of the Board, or its Chief Executive Officer, or its President, or any Vice Chairman, or any Vice President of the Company (whether or not designated by a number or a word or words added before or after the title Vice President), and by its Treasurer or an Assistant Treasurer or its Controller or its Secretary or an Assistant 17 Secretary under its corporate seal, which may be affixed thereto or printed, engraved or otherwise reproduced thereon, by facsimile or otherwise. Only such Securities as shall bear thereon a certificate of authentication substantially in the form recited herein, executed by or on behalf of the Trustee manually by an authorized signatory, shall be entitled to the benefits of this Indenture or be valid or obligatory for any purpose. Such certificate of authentication by the Trustee upon any Security executed by the Company shall be conclusive evidence that the Security so authenticated has been duly authenticated and delivered hereunder and that the holder is entitled to the benefits of this Indenture. Typographical or other errors or defects in the seal or facsimile signature on any Security or in the text thereof shall not affect the validity or enforceability of such Security if it has been duly authenticated and delivered by the Trustee. In case any officer of the Company who shall have signed any of the Securities, manually or in facsimile, shall cease to be such officer before the Securities so signed shall have been authenticated and delivered by the Trustee, or disposed of by the Company, such Securities nevertheless may be authenticated and delivered or disposed of as though the person who signed such Securities had not ceased to be such officer of the Company; and any Security may be signed on behalf of the Company, manually or in facsimile, by such persons as, at the actual date of the execution of such Security, shall be the proper officers of the Company, although at the date of the execution of this Indenture any such person was not such officer. Section 2.05 Registration, Transfer and Exchange of Securities. Securities ------------------------------------------------- of any series (other than a global Security, except as set forth below) may be exchanged for a like aggregate principal amount of Securities of the same series of the same tenor and terms of other authorized denominations. Securities to be exchanged shall be surrendered at the offices or agencies to be maintained by the Company in accordance with the provisions of SECTION 4.02 and the Company shall execute and the Trustee shall authenticate and deliver, or cause to be authenticated and delivered, in exchange therefor the Security or Securities which the Securityholder making the exchange shall be entitled to receive. The Company shall keep, at one or more of the offices or agencies to be maintained by the Company in accordance with the provisions of SECTION 4.02 with respect to the Securities of each series, a Register ( the "REGISTER") in which, subject to such reasonable regulations as it may prescribe, the Company shall register the Securities of such series and the transfer of Securities of such series as in this Article provided. Such Register shall be in written form or in any other form capable of being converted into written form within a reasonable time. At all reasonable times the Register shall be open for inspection by the Trustee and any registrar of the Securities of such series other than the Trustee. Upon due presentment for registration or transfer of any Security of any series at the offices or agencies of the Company to be maintained by the Company in accordance with SECTION 4.02 with respect to the Securities of such series, the Company shall execute and register and the Trustee shall authenticate and deliver in the name of the transferee or transferees a new Security or Securities of the same series of like tenor and terms for a like aggregate principal amount of authorized denominations. Every Security issued upon registration of transfer or exchange of Securities pursuant to this Section shall be the valid obligation of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Security or Securities surrendered upon registration of such transfer or exchange. 18 All Securities of any series presented or surrendered for exchange, registration of transfer, redemption, conversion or payment shall, if so required by the Company or any registrar of the Securities of such series, be accompanied by a written instrument or instruments of transfer, in form satisfactory to the Company and such registrar, duly executed by the registered holder or by his attorney duly authorized in writing. No service charge shall be made for any exchange or registration of transfer of Securities, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto. The Company shall not be required to exchange or register the transfer of (a) any Securities of any series during a period beginning at the opening of business fifteen days before the day of the mailing of a notice of redemption of outstanding Securities of such series and ending at the close of business on the relevant redemption date, or (b) any Securities or portions thereof called or selected for redemption, except, in the case of Securities called for redemption in part, the portion thereof not so called for redemption. Notwithstanding any other provision of this Section, unless and until it is exchanged in whole or in part for Securities in definitive form, a global Security representing all or a portion of the Securities of a series may not be transferred, except as a whole by the Depositary for such series 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 such series or a nominee of such successor Depositary. Notwithstanding the foregoing, except as otherwise specified pursuant to SECTION 2.01, any global Security shall be exchangeable pursuant to this Section only as provided in this paragraph. If at any time the Depositary for the Securities of a series notifies the Company that it is unwilling or unable to continue as Depositary for the Securities of such series, or if at any time the Depositary for the Securities of such series shall no longer be eligible to so act, the Company shall appoint a successor Depositary with respect to the Securities of such series. If (a) a successor Depositary for the Securities of such series is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such ineligibility (thereby automatically making the Company's election pursuant to SECTION 2.01 no longer effective with respect to the Securities of such series), (b) the beneficial owners of interests in a global Security are entitled to exchange such interests for definitive Securities of such series and of the same tenor and terms, as specified pursuant to SECTION 2.01, or (c) the Company in its sole discretion determines that the Securities of any series issued in the form of one or more global Securities shall no longer be represented by such global Security or Securities, then without unnecessary delay, but, if appropriate, in any event not later than the earliest date on which such interest may be so exchanged, the Company shall deliver to the Trustee definitive Securities in aggregate principal amount equal to the principal amount of such global Security, executed by the Company and authenticated by the Trustee. On or after the earliest date on which such interests are or may be so exchanged, such global Security shall be surrendered by the Depositary to the Trustee, as the Company's agent for such purpose, to be exchanged, in whole or from time to time in part, for definitive Securities upon payment by the beneficial owners of such interest, at the option of the Company, of a service charge for such exchange and of a proportionate share of the cost of printing such definitive Securities, and the Trustee shall 19 authenticate and deliver, (a) to each person specified by the Depositary in exchange for each portion of such global Security, an equal aggregate principal amount of definitive Securities of the same series of authorized denominations and of the same tenor and terms as the portion of such global Security to be exchanged, and (b) to such Depositary a global Security in a denomination equal to the difference, if any, between the principal amount of the surrendered global security and the aggregate principal amount of definitive Securities delivered to holders thereof; provided, however, that no such exchanges may occur during a period beginning at the opening of business 15 days before any selection of Securities of that series to be redeemed and ending on the relevant redemption date. If a Security is issued in exchange for any portion of a global Security after the close of business at the office or agency where such exchange occurs on (i) any record date and before the opening of business at such office or agency on the relevant interest payment date, or (ii) any record date for the payment of defaulted interest and before the opening of business at such office or agency on the related proposed date for payment of defaulted interest, then interest or default interest, as the case may be, will not be payable on such interest payment date or proposed date for payment of defaulted interest, as the case may be, in respect of such Security, but will be payable on such interest payment date or proposed date for payment of defaulted interest, as the case may be, only to the person to whom interest in respect of such portion of such global Security is payable in accordance with the provisions of this Indenture and such global Security. Section 2.06 Temporary Securities. Pending the preparation of definitive -------------------- Securities of any series, the Company may execute and the Trustee shall, upon the written order of the Company, authenticate and deliver temporary Securities of such series (printed or lithographed) of any denomination and substantially in the form of the definitive Securities of such series, but with or without a recital of specific redemption prices or conversion provisions and with such omissions, insertions and variations as may be appropriate for temporary Securities, all as may be determined by the Company. Temporary Securities may contain such reference to any provisions of this Indenture as may be appropriate. Every such temporary Security shall be authenticated by the Trustee upon the same conditions and in substantially the same manner, and with the same effect, as the definitive Securities. Without unreasonable delay the Company will execute and deliver to the Trustee definitive Securities of such series and thereupon any or all temporary Securities of such series may be surrendered in exchange therefor, at the offices or agencies to be maintained by the Company as provided in SECTION 4.02 with respect to the Securities of such series, and the Trustee shall, upon the written order of the Company, authenticate and deliver in exchange for such temporary Securities an equal aggregate principal amount of definitive Securities of such series. Until so exchanged, the temporary Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Securities of such series authenticated and delivered hereunder. Section 2.07 Mutilated, Destroyed, Lost or Stolen Securities. In case any ----------------------------------------------- temporary or definitive Security shall become mutilated or be destroyed, lost or stolen, the Company, in the case of any mutilated Security shall, and in the case of any destroyed, lost or stolen Security in its discretion may, execute, and upon its request the Trustee shall authenticate and deliver, or cause to be authenticated and delivered, a new Security of the same series of like tenor and terms in exchange and substitution for the mutilated Security, or in lieu of and in substitution for the Security so destroyed, lost or stolen. In case any such Security shall have matured or shall be about to mature, instead of issuing a substituted Security, the Company may pay or authorize payment of the same 20 (without surrender thereof, except in the case of a mutilated Security). In every case the applicant for a substituted Security or for such payment shall furnish to the Company and the Trustee such security or indemnity as may be required by them to save each of them harmless, and, in every case of destruction, loss or theft, the applicant shall also furnish to the Company and to the Trustee evidence to their satisfaction of the destruction, loss or theft of such Security and of the ownership thereof. The Trustee may authenticate any such substituted Security and deliver the same, or the Trustee or any Paying Agent of the Company may make any such payment, upon the written request or authorization of any officer of the Company. Upon the issue of any substituted Security, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other reasonable expenses connected therewith (including the fees and expenses of the Trustee). To the extent permitted by mandatory provisions of law, every substituted Security issued pursuant to the provisions of this Section in substitution for any destroyed, lost or stolen Security shall constitute an additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Security shall be found at any time, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities of the same series duly issued hereunder. To the full extent legally enforceable, all Securities shall be held and owned upon the express condition that the foregoing provisions are exclusive with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities and shall preclude any and all other rights or remedies notwithstanding any law or statute now existing or hereafter enacted to the contrary with respect to the replacement or payment of negotiable instruments or other securities without their surrender. Section 2.08 Cancellation and Destruction of Surrendered Securities. All ------------------------------------------------------ Securities surrendered for the purpose of payment, redemption, exchange, substitution or registration of transfer, shall, if surrendered to the Company or any agent of the Company or of the Trustee, be delivered to the Trustee, and the same, together with Securities surrendered to the Trustee for cancellation, shall be cancelled by it, and no Securities shall be issued in lieu thereof except as expressly permitted by any of the provisions of this Indenture. All canceled Securities held by the Trustee shall be disposed of in conformance with the Trustee's then customary procedures, unless otherwise directed by a written order of the Company; provided however, that the Trustee shall not be required to destroy any Securities. If the Company shall purchase or otherwise acquire any of the Securities, however, such purchase or acquisition shall not operate as a payment, redemption or satisfaction of the indebtedness represented by such Securities unless and until the Company, at its option, shall deliver or surrender the same to the Trustee for cancellation. Section 2.09 Authenticating Agents. The Trustee may from time to time --------------------- appoint one or more Authenticating Agents with respect to one or more series of Securities, which shall be authorized to act on behalf of the Trustee and subject to its direction in authenticating and delivering Securities of such series pursuant hereto as fully to all intents and purposes as though any such Authenticating Agent had been expressly authorized to authenticate and deliver Securities of such series, and Securities so authenticated shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all 21 purposes as though authenticated by the Trustee. Wherever reference is made in this Indenture to the authentication or delivery of Securities by the Trustee or the Trustee's certificate of authentication, such reference shall be deemed to include authentication or delivery on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating Agent. Each Authenticating Agent shall at all times be a corporation (including a banking association) organized and doing business under the laws of the United States or any State or territory thereof or of the District of Columbia, having a combined capital and surplus of at least five million dollars ($5,000,000) authorized under such laws to exercise corporate trust powers and subject to supervision or examination by federal, state, territorial, or District of Columbia authorities. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time an Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect herein specified in this Section. Any corporation succeeding to the corporate agency business of an Authenticating Agent shall continue to be an Authenticating Agent, if such successor corporation is otherwise eligible under this Section, without the execution or filing of any paper or any further act on the part of the Trustee or the Authenticating Agent or such successor corporation. Any Authenticating Agent may at any time resign by giving written notice of resignation to the Trustee and to the Company. The Trustee may at any time terminate the agency of an Authenticating Agent by giving written notice of termination to such Authenticating Agent and to the Company. Upon receiving such a notice of resignation or upon such a termination, or in case at any time an Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, the Trustee may appoint a successor Authenticating Agent. Any successor Authenticating Agent upon acceptance of its appointment hereunder shall become vested with all the rights, powers and duties of its predecessor hereunder, with like effect as if originally named as an Authenticating Agent herein. No successor Authenticating Agent shall be appointed unless eligible under the provisions of this Section. The Company agrees to pay to each Authenticating Agent from time to time reasonable compensation for its services under this Section. Any Authenticating Agent by the acceptance of its appointment shall be deemed to have agreed with the Trustee that: it will perform and carry out the duties of an Authenticating Agent as herein set forth, including among other things the duties to authenticate and deliver Securities of any series for which it has been appointed an Authenticating Agent when presented to it in connection with exchanges, registrations of transfer or any redemptions or conversions thereof; it will furnish from time to time as requested by the Trustee appropriate records of all transactions carried out by it as Authenticating Agent and will furnish the Trustee such other information and reports as the Trustee may reasonably require; it is eligible for appointment as Authenticating Agent under this Section and will notify the Trustee promptly if it shall cease to be so qualified; and it will indemnify the Trustee against any loss, liability or expense incurred by the Trustee and will defend any claim asserted 22 against the Trustee by reason of any acts or failures to act of the Authenticating Agent but it shall have no liability for any action taken by it at the specific written direction of the Trustee. Section 2.10 Deferrals of Interest Payment Dates. If specified as ----------------------------------- contemplated by SECTION 2.01 or SECTION 2.02 with respect to the Securities of a particular series, so long as no Event of Default has occurred and is continuing, the Company shall have the right, at any time during the term of such series, from time to time to defer the payment of interest on such Securities for such period or periods as may be specified as contemplated by SECTION 2.01 (each, an "EXTENSION PERIOD") during which Extension Periods the Company shall have the right to make partial payments of interest on any interest payment date. No Extension Period shall end on a date other than an interest payment date or extend beyond the Stated Maturity or any earlier prepayment date. At the end of any such Extension Period the Company shall pay all interest then accrued and unpaid on the Securities (together with Additional Interest or other interest thereon, if any, at the rate specified for the Securities of such series to the extent permitted by applicable law). During any such Extension Period, the Company shall not, and shall cause any Subsidiary not to, (i) declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of the Company's Capital Stock (which includes Common Stock and preferred stock) or (ii) make any payment of principal of or interest or premium, if any, on or repay, repurchase or redeem any debt securities that rank on a parity with or junior to the Securities of such series or make any guarantee payments with respect to any DPL Guarantee or other guarantee by the Company that ranks on a parity with or junior to the Securities of such series (other than (a) dividends or distributions payable in Common Stock; (b) any declaration of a dividend in connection with the implementation of a Rights Plan, the issuance of any Capital Stock of any class or series of preferred stock of the Company under any Rights Plan or the redemption or repurchase of any rights distributed pursuant to a Rights Plan; (c) payments under any DPL Guarantee relating to the Preferred Securities issued by the DPL Trust holding the Securities of such series; and (d) purchases of Common Stock related to the issuance of Common Stock or rights under any of the Company's benefit plans for its directors, officers, employees, consultants or advisors). Before the termination of any Extension Period, the Company may further extend such Extension Period; provided, however, that no Extension Period shall exceed the period or periods specified in such Securities or extend beyond the Stated Maturity of the principal of such Securities or any earlier prepayment date. At any time following the termination of any Extension Period and upon the payment of all accrued and unpaid interest and any Additional Interest or other interest then due, the Company may elect to begin a new Extension Period, subject to the above requirements. No interest shall be due and payable during an Extension Period, except at the end thereof. If the Property Trustee of a DPL Trust is the only registered holder of the Securities of a series at the time the Company elects to begin or extend an Extension Period, the Company shall give written notice to such Property Trustee and the Trustee of its election to begin or extend any Extension Period at least five Business Days prior to the earlier of (i) the next succeeding date on which Distributions on the corresponding Capital Securities issued by such DPL Trust 23 would have been payable but for the election to begin or extend such Extension Period or (ii) the date the Administrative Trustees of such DPL Trust are required to give notice to any securities exchange or other applicable self-regulatory organization or to holders of such Capital Securities of the record date or the date such Distributions are payable, but in any event not less than five Business Days prior to such record date. If the Property Trustee of a DPL Trust is not the only holder of the Securities of a series at the time the Company elects to begin or extend an Extension Period, the Company shall give the holders of such Securities and the Trustee written notice of its election to begin or extend such Extension Period at least ten Business Days prior to the earlier of (i) the next succeeding interest payment date or (ii) the date the Company is required to give notice of the record or payment date of such interest payment to any applicable self-regulatory organization or to holders of such Securities. An Administrative Trustee shall give notice of the Company's election to begin or extend an Extension Period to the holders of the outstanding Preferred Securities of such DPL Trust. Section 2.11 Right of Set-Off. With respect to the Securities of a series ---------------- issued to a DPL Trust, notwithstanding anything to the contrary in the Indenture, the Company shall have the right to set off any payment it is otherwise required to make thereunder in respect of any such Security to the extent the Company has theretofore made, or is concurrently on the date of such payment making, a payment under the DPL Guarantee relating to such Security or under SECTION 6.05 of this Indenture. Section 2.12 Shortening or Extension of Stated Maturity. If specified as ------------------------------------------ contemplated by SECTION 2.01 or SECTION 2.02 with respect to the Securities of a particular series, the Company shall have the right to (i) shorten the Stated Maturity of the principal of the Securities of such series at any time to any date not earlier than the first date on which the Company has the right, if any, to redeem the Securities of such series, and (ii) extend the Stated Maturity of the principal of the Securities of such series at any time at its election for one or more periods, but in no event to a date later than the 49th anniversary of the first interest payment date following the Original Issue Date of the Securities of such series; provided that, if the Company elects to shorten or extend the Stated Maturity, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that such change in Stated Maturity will not cause Securityholders to recognize income, gain or loss for United Stated federal income tax purposes as a result of such change to the Stated Maturity and will result in the Securityholders being subject to United States federal income tax on the same amount, in the same manner and at the times as would have been if such change had not occurred; and additionally, if the Company elects to exercise its right to extend the Stated Maturity of the principal of the Securities of such series pursuant to this clause (ii), at the time such election is made and at the time of extension (A) the Company is not in bankruptcy, otherwise insolvent or in liquidation, (B) the Company is not in default in the payment of any interest or principal on such Securities, (C) in the case of any series of Securities issued to a DPL Trust, such DPL Trust is not in arrears on payments of Distributions on the Preferred Securities issued by such DPL Trust and no deferred Distributions are accumulated, and (D) such Securities are rated not less than BBB- by Standard & Poor's Ratings Services or Baa3 by Moody's Investors Service, Inc. or the equivalent by any other nationally recognized statistical rating organization. In the event the Company elects to shorten or extend the Stated Maturity of the Securities of a particular series, it shall give notice to the Trustee (not less than 45 days prior to the effectiveness thereof), and the Trustee shall give notice of such 24 shortening or extension to the holders not less than 30 nor more than 60 days prior to the effectiveness thereof. Section 2.13 Agreed Tax Treatment. Each Security issued hereunder shall -------------------- provide that the Company and, by its acceptance of a security or a beneficial interest therein, the holder of, and any Person that acquires a beneficial interest in, such Security agree that for United States federal, state and local tax purposes it is intended that such Security constitute indebtedness. Section 2.14 CUSIP Numbers. The Company in issuing the Securities may use ------------- "CUSIP" or other similar numbers (if then generally in use), and, if so, the Trustee shall use "CUSIP" or such other numbers in notices of redemption as a convenience to holders of Securities; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company will promptly notify the Trustee of any change in the CUSIP numbers. ARTICLE III REDEMPTION OF SECURITIES ------------------------ Section 3.01 Applicability of Article. Securities of any series which are ------------------------ redeemable prior to Stated Maturity shall be redeemable in accordance with their terms and (except as otherwise specified as contemplated by SECTION 2.01 for Securities of any series) in accordance with this Article. Section 3.02 Mailing of Notice of Redemption. In case the Company shall ------------------------------- desire to exercise any right to redeem all or, as the case may be, any part of the Securities of any series pursuant to this Indenture, it shall give notice of such redemption to holders of the Securities to be redeemed as hereinafter in this Section provided. The Company covenants that it will pay to the Trustee or one or more Paying Agents, on or before the Business Day next preceding the date fixed for each redemption of Securities, a sum in cash sufficient to redeem on the redemption date all the Securities so called for redemption at the applicable redemption price, together with any accrued interest on the Securities to be redeemed to but excluding the date fixed for redemption. Notice of redemption shall be given to the holders of Securities to be redeemed as a whole or in part by mailing by first class mail, postage prepaid, a notice of such redemption not less than 30 nor more than 60 days prior to the date fixed for redemption to their last addresses as they shall appear upon the Register, but failure to give such notice by mailing in the manner herein provided to the holder of any Security designated for redemption as a whole or in part, or any defect therein, shall not affect the validity of the proceedings for the redemption of any other Security. 25 Any notice which is mailed in the manner herein provided shall be conclusively presumed to have been duly given, whether or not the holder receives the notice. Each such notice of redemption shall identify the Securities to be redeemed (including CUSIP numbers) and specify the date fixed for redemption and the redemption price at which Securities are to be redeemed (or if the redemption price cannot be calculated prior to the time the notice is required to be given, the manner of calculation thereof), and shall state that payment of the redemption price of the Securities or portions thereof to be redeemed will be made at any of the offices or agencies to be maintained by the Company in accordance with the provisions of SECTION 4.02 with respect to the Securities to be redeemed, upon presentation and surrender of such Securities or portions thereof, and that, if applicable, interest accrued to the date fixed for redemption will be paid as specified in said notice and on and after said date interest thereon will cease to accrue and shall also specify, if applicable, the conversion price and the date on which the right to convert the Securities will expire and that holders must comply with Article XV hereof in order to convert their Securities. If less than all the Securities of any series are to be redeemed, the notice of redemption to each holder shall specify such holder's Securities of such series to be redeemed as a whole or in part. In case any Security is to be redeemed in part only, the notice which relates to such Security shall state the portion of the principal amount thereof to be redeemed (which shall be equal to the minimum authorized denomination for Securities of such series or any whole multiple thereof), and shall state that on and after the redemption date, upon surrender of such Security, the holder will receive the redemption price in respect to the principal amount thereof called for redemption and, without charge, a new Security or Securities of the same series of authorized denominations for the principal amount thereof remaining unredeemed. If the Securities of any series are to be redeemed, the Company shall give the Trustee, at least 60 days in advance of the date fixed for redemption, notice of the aggregate principal amount of Securities of such series to be redeemed, and, if less than all the Securities of such series are to be redeemed, thereupon the Trustee shall select, by lot, or in any manner it shall deem fair, the Securities of such series to be redeemed as a whole or in part and shall thereafter promptly notify the Company in writing of the particular Securities of such series or portions thereof to be redeemed. If the Securities of any series to be redeemed consist of Securities having different dates on which the principal or any installment of principal is payable or different rates of interest, if any, or different methods by which interest may be determined or have any other different tenor or terms, then the Company may, by written notice to the Trustee, direct that Securities of such series to be redeemed shall be selected from among groups of such Securities having specified tenor or terms and the Trustee shall thereafter select the particular Securities to be redeemed in the manner set forth in the preceding sentence from among the group of such Securities so specified. Section 3.03 When Securities Called for Redemption Become Due and Payable. ------------------------------------------------------------ If the giving of notice of redemption shall have been completed as above provided, the Securities or portions of Securities specified in such notice shall become due and payable on the date and at the place or places stated in such notice at the applicable redemption price, together, if applicable, with any interest accrued (including any Additional Interest or other interest) to but excluding the date fixed for redemption, and on and after such date fixed for redemption (unless the Company shall default in the payment of such Securities at the applicable redemption price, together with any interest 26 accrued to the date fixed for redemption) any interest on the Securities or portions of Securities so called for redemption shall cease to accrue, and, except as provided in SECTIONS 7.05 and 12.04, such Securities shall cease from and after the date fixed for redemption to be entitled to any benefit or security under this Indenture, and the holders thereof shall have no right in respect of such Securities except the right to receive the redemption price thereof and any unpaid interest accrued to but excluding the date fixed for redemption. On presentation and surrender of such Securities at said place of payment in said notice specified, such Securities or portions thereof shall be paid and redeemed by the Company at the applicable redemption price, together with any interest accrued to but excluding the date fixed for redemption; provided, however, that, except as otherwise specified as contemplated by SECTION 2.01, any regular payment of interest becoming due on the date fixed for redemption shall be payable to the holders of the Securities registered as such on the relevant record date as provided in Article II hereof. Upon surrender of any Security which is redeemed in part only, the Company shall execute and the Trustee shall authenticate and deliver at the expense of the Company a new Security of the same series of like tenor and terms of authorized denomination in principal amount equal to the unredeemed portion of the Security so surrendered; except that if a global Security is so surrendered, the Company shall execute, and the Trustee shall authenticate and deliver to the Depositary for such global Security, without service charge, a global Security in a denomination equal to and in exchange for the unredeemed portion of the principal of the global Security so surrendered. If any Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal shall, until paid, bear interest from the date fixed for redemption at the rate borne by or prescribed therefor in the Security, or, in the case of a Security which does not bear interest, at the rate of interest set forth therefor in the Security to the extent permitted by law. ARTICLE IV PARTICULAR COVENANTS OF THE COMPANY ----------------------------------- The Company covenants as follows: Section 4.01 Payment of Principal of and Interest on Securities. The -------------------------------------------------- Company will duly and punctually pay or cause to be paid the principal of and interest (including interest accruing during an Extension Period or on or after the filing of a petition in bankruptcy or reorganization relating to the Company, and including any rate of interest applicable upon default, whether or not a claim for post-petition interest is allowed in such proceeding), if any, on each of the Securities at the time and places and in the manner provided herein and in the Securities. Except as otherwise specified as contemplated by SECTION 2.01, if the Securities of any series bear interest, each installment of interest on the Securities of such series may at the option of the Company be paid (i) by mailing a check or checks for such interest payable to the Person entitled thereto pursuant to SECTION 2.03 to the address of such person as it appears on the Register of the Securities of such series or (ii) by transfer to an account maintained by the Person entitled thereto as specified in the Register of Securities; provided that proper transfer instructions have been received by the record date. 27 Section 4.02 Maintenance of Offices or Agencies for Registration of ------------------------------------------------------ Transfer, Exchange and Payment of Securities. So long as any of the Securities - -------------------------------------------- shall remain outstanding, the Company will maintain an office or agency in the City of Dayton, State of Ohio, or in The City of New York, State of New York, where the Securities may be presented for registration, conversion, exchange and registration of transfer as in this Indenture provided, and where notices and demands to or upon the Company in respect of the Securities or of this Indenture may be served, and where the Securities may be presented for payment. In case the Company shall designate and maintain some office or agency other than the previously designated office or agency, it shall give the Trustee prompt written notice thereof. In case the Company shall fail to maintain any such office or agency or shall fail to give such notice of the location or of any change in the location thereof to the Trustee, presentations and demands may be made and notices may be served at the principal office of the Trustee. In addition to such office or agency, the Company may from time to time constitute and appoint one or more other offices or agencies for such purposes with respect to Securities of any series, and one or more paying agents for the payment of Securities of any series, in such cities or in one or more other cities, and may from time to time rescind such appointments, as the Company may deem desirable or expedient, and as to which the Company has notified the Trustee; provided, however, that no such appointment or rescission shall in any manner relieve the Company of its obligation to maintain such office or agency in the said Cities of Dayton or New York, where Securities of such series may be presented for payment. Section 4.03 Appointment to Fill a Vacancy In The Office of Trustee. The ------------------------------------------------------ Company, whenever necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the manner provided in SECTION 7.10, a Trustee, so that there shall at all times be a Trustee with respect to each series of Securities hereunder. Section 4.04 Duties of Paying Agent. (a) If the Company shall appoint a ---------------------- Paying Agent other than the Trustee with respect to Securities of any series, it will cause such Paying Agent to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section and SECTION 12.03, (1) That it will hold all sums held by it as such agent for the payment of the principal of or interest, if any, on the Securities of such series (whether such sums have been paid to it by the Company or by any other obligor on the Securities of such series) in trust for the benefit of the holders of the Securities of such series entitled to such principal or interest and will notify the Trustee of the receipt of sums to be so held, (2) That it will give the Trustee notice of any failure by the Company (or by any other obligor on the Securities of such series) to make any payment of the principal of or interest on the Securities of such series when the same shall be due and payable, and (3) That it will at any time during the continuance of any Event of Default, upon the written request of the Trustee, deliver to the Trustee all sums so held in trust by it. 28 (b) Whenever the Company shall have one or more Paying Agents with respect to the Securities of any series, it will, prior to each due date of the principal of or any interest on a Security of such series, deposit with a Paying Agent of such series a sum sufficient to pay the principal or interest so becoming due, such sum to be held in trust for the benefit of the holders of Securities of such series entitled to such principal or interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act. (c) If the Company shall act as its own Paying Agent with respect to the Securities of any series, it will, on or before each due date of the principal of or any interest on a Security of such series, set aside, segregate and hold in trust for the benefit of the holder of such Security, a sum sufficient to pay such principal or interest so becoming due and will notify the Trustee of such action, or any failure by it or any other obligor on the Securities of such series to take such action and will at any time during the continuance of any Event of Default, upon the written request of the Trustee, deliver to the Trustee all sums so held in trust by it. (d) Anything in this Section to the contrary notwithstanding, the Company may, at any time, for the purpose of obtaining a satisfaction and discharge of this Indenture with respect to one or more or all series of Securities hereunder, or for any other reason, pay or cause to be paid to the Trustee all sums held in trust for such series by it, or any Paying Agent hereunder, as required by this Section, such sums are to be held by the Trustee upon the trust herein contained. (e) Anything in this Section to the contrary notwithstanding, the agreement to hold sums in trust as provided in this Section is subject to the provisions of SECTIONS 12.03 and 12.04. Section 4.05 Further Assurances. From time to time whenever reasonably ------------------ demanded by the Trustee, the Company will make, execute and deliver or cause to be made, executed and delivered any and all such further and other instruments and assurances and take all such further action as may be reasonably necessary or proper to carry out the intention of or to facilitate the performance of the terms of this Indenture or to secure the rights and remedies hereunder of the holders of the Securities of any series. Section 4.06 Officers' Certificate As to Defaults; Notices of Certain -------------------------------------------------------- Defaults. The Company will, so long as any of the Securities are outstanding, - -------- deliver to the Trustee no later than 120 days after the end of each calendar year, beginning with the year 2002, a certificate signed by the Company's principal executive officer, principal financial officer or principal accounting officer stating that a review has been made under his or her supervision of the activities of the Company during such year and of the performance under this Indenture and, to the best of his or her knowledge, the Company has complied with all conditions and covenants under this Indenture throughout such calendar year, or if there has been a default in the fulfillment of any such obligation, specifying each such default known and the nature and status thereof. For purposes of this Section, such compliance shall be determined without regard to any period of grace or requirement of notice provided under this Indenture. Section 4.07 Waiver of Covenants. The Company may omit in any particular ------------------- instance to comply with any covenant or condition specifically contained in this Indenture for the benefit of one or more series of Securities, if before the 29 time for such compliance the holders of a majority in principal amount of the Securities of all series affected (all series voting as one class) at the time outstanding (determined as provided in SECTION 8.04) shall waive such compliance in such instance, but no such waiver shall extend to or affect such covenant or condition except to the extent so expressly waived, and, until such waiver shall become effective, the obligations of the Company and the duties of the Trustee in respect of any such covenant or condition shall remain in full force and effect. Section 4.08 Additional Tax Sums. In the case of the Securities of a series ------------------- issued to a DPL Trust, except as otherwise specified as contemplated by SECTION 2.01 or SECTION 2.02, in the event that (i) a DPL Trust is the holder of all of the Outstanding Securities of such series, and (ii) the Company shall not have (a) redeemed the Securities of such series or (b) terminated such DPL Trust pursuant to the termination provisions of the related Trust Agreement, the Company shall pay to such DPL Trust (and any permitted successor or assign under the related Trust Agreement) for so long as such DPL Trust (or its permitted successor or assignee) is the registered holder of any Securities of such series, such additional amounts as may be necessary in order that the amount of Distributions then due and payable by such DPL Trust on the related Preferred Securities and Common Securities that at any time remain outstanding in accordance with the terms thereof shall not be reduced as a result of any additional taxes, duties and other governmental charges to which such DPL Trust has become subject (but not including withholding taxes imposed on holders of such Preferred Securities and Common Securities) (the "ADDITIONAL TAX SUMS"). Whenever in this Indenture or the Securities there is a reference in any context to the payment of principal of or interest on the Securities, such reference shall be deemed to include payment of the Additional Tax Sums provided for in this paragraph to the extent that, in such context, Additional Tax Sums are, were or would be payable in respect thereof pursuant to the provisions of this Section and express reference to the payment of Additional Tax Sums (if applicable) in any provisions hereof shall not be construed as excluding Additional Tax Sums in those provisions hereof where such express reference is not made; provided, however, that the deferral of the payment of interest pursuant to SECTION 2.10 or the Securities shall not defer the payment of any Additional Tax Sums that may be then due and payable. Section 4.09 Additional Covenants. The Company covenants and agrees with -------------------- each holder of Securities of a series issued to a DPL Trust that it shall not, and it shall cause any Subsidiary not to, (i) declare or pay any dividends or distributions on, or redeem, purchase, acquire, or make a liquidation payment with respect to, any shares of the Company's Capital Stock (which includes Common Stock and preferred stock), or (ii) make any payment of principal of or interest or premium, if any, on or repay, repurchase or redeem any debt securities that rank on a parity with or junior to the Securities of such series or make any guarantee payments with respect to any DPL Guarantee or other guarantee by the Company that ranks on a parity with or junior to the Securities of such series (other than (a) dividends or distributions payable in Common Stock; (b) any declaration of a dividend in connection with the implementation of a Rights Plan, the issuance of any Capital Stock of any class or series of preferred stock of the Company under any Rights Plan or the redemption or repurchase of any rights distributed pursuant to a Rights Plan; (c) payments under any DPL Guarantee relating to the Preferred Securities issued by the DPL Trust holding the Securities of such series; and (d) purchases of Common Stock related to the issuance of Common Stock or rights under any of the Company's 30 benefit plans for its directors, officers, employees, consultants or advisors) if at such time (i) there shall have occurred any event of which the Company has actual knowledge that (a) with the giving of notice or the lapse of time or both, would constitute an Event of Default hereunder and (b) in respect of which the Company shall not have taken reasonable steps to cure, (ii) the Company shall be in default with respect to its payment of any obligations under the related DPL Guarantee or (iii) the Company shall have given notice of its election to begin an Extension Period as provided in SECTION 2.10 and shall not have rescinded such notice, or such Extension Period, or any extension thereof, shall be continuing. The Company also covenants with each holder of Securities of a series issued to a DPL Trust (i) to maintain directly or indirectly 100% ownership of the Common Securities of such DPL Trust; provided, however, that any permitted successor or assignee of the Company hereunder may succeed to the Company's ownership of such Common Securities, (ii) not to voluntarily terminate, wind up or liquidate such DPL Trust, except (a) in connection with a prepayment in full of the Securities or a distribution of the Securities of such series to the holders of Preferred Securities in liquidation of such DPL Trust or (b) in connection with certain mergers, consolidations or amalgamations permitted by the relevant Trust Agreement and (iii) to use its reasonable efforts, consistent with the terms and provisions of such Trust Agreement, to cause such DPL Trust to remain classified as a grantor trust and not an association taxable as a corporation for United States federal income tax purposes. Section 4.10 Calculation of Original Issue Discount. The Company shall file -------------------------------------- with the Trustee promptly at the end of each calendar year (i) a written notice specifying the amount of original issue discount (including daily rates and accrual periods) accrued on outstanding Securities as of the end of such year and (ii) such other specific information relating to such original issue discount as may then be relevant under the Internal Revenue Code of 1986, as amended from time to time. ARTICLE V SECURITYHOLDERS' LISTS AND REPORTS BY THE COMPANY ------------------------------------------------- AND THE TRUSTEE --------------- Section 5.01 Company to Furnish Trustee Information As to The Names and ---------------------------------------------------------- Addresses of Securityholders. The Company covenants and agrees that it will - ---------------------------- furnish or cause to be furnished to the Trustee, semiannually not more than 5 days after March 15 and September 15 of each year beginning with March 15, 2002, and at such other times as the Trustee may request in writing within 30 days after receipt by the Company of any such request, a list in such form as the Trustee may reasonably require containing all information in the possession or control of the Company, or any Paying Agent or any registrar of the Securities of each series, other than the Trustee, as to the names and addresses of the holders of Securities of such series obtained (in the case of each list other than the first list) since the date as of which the next previous list was furnished; provided, however, that if the Trustee shall be the registrar of the Securities of such series, no such list need be furnished. Any such list may be dated as of a date not more than fifteen days prior to the time such information is furnished or caused to be furnished, and need not include information received after such date. 31 Section 5.02 Trustee to Preserve Information As to The Names and Addresses ------------------------------------------------------------- of Securityholders Received By It. (a) The Trustee shall preserve, in as current - --------------------------------- a form as is reasonably practicable, all information as to the names and addresses of the holders of Securities of each series (1) contained in the most recent list furnished to it as provided in SECTION 5.01 and (2) received by it in the capacity of Paying Agent or registrar (if so acting). The Trustee may destroy any list furnished to it as provided in SECTION 5.01 upon receipt of a new list so furnished. (b) In case three or more holders of Securities of any series (hereinafter referred to as "APPLICANTS") apply in writing to the Trustee, and furnish to the Trustee reasonable proof that each such applicant has owned a Security for a period of at least six months preceding the date of such application, and such application states that the applicants desire to communicate with other holders of Securities of any series or with holders of all Securities with respect to their rights under this Indenture or under such Securities, and is accompanied by a copy of the form of proxy or other communication which such applicants propose to transmit, then the Trustee shall, within five Business Days after the receipt of such application, at its election, either (1) afford such applicants access to the information preserved at the time by the Trustee in accordance with the provisions of subsection (a) of this Section, or (2) inform such applicants as to the approximate number of holders of Securities of such series or all Securities, as the case may be, whose names and addresses appear in the information preserved at the time by the Trustee in accordance with the provisions of subsection (a) of this Section, and as to the approximate cost of mailing to such Securityholders the form of proxy or other communication, if any, specified in such application. If the Trustee shall elect not to afford such access to such information, the Trustee shall, upon the written request of such applicants, mail to each of the holders of Securities of such series, or all Securities, as the case may be, whose name and address appear in the information preserved at the time by the Trustee in accordance with the provisions of subsection (a) of this Section, a copy of the form of proxy or other communication which is specified in such request, with reasonable promptness after a tender to the Trustee of the material to be mailed and after payment, or provision for the payment, of the reasonable expenses of mailing, unless within five days after such tender, the Trustee shall mail to such applicants and file with the Commission, together with a copy of the material to be mailed, a written statement to the effect that, in the opinion of the Trustee, such mailing would be contrary to the best interests of the holders of Securities of such series or all Securities, as the case may be, or would be in violation of applicable law. Such written statement shall specify the basis of such opinion. If the Commission, after opportunity for a hearing upon the objections specified in the written statement so filed, shall enter an order refusing to sustain any of such objections or if, after the entry of an order sustaining one or more of such objections, the Commission shall find, after notice and opportunity for hearing, that all the objections so sustained have been met and shall enter an order so declaring, the Trustee shall mail copies of such material to all the holders of Securities of such series or all Securities, as the case may be, with reasonable promptness after the entry of such order and the renewal of such tender; otherwise the Trustee shall be relieved of any obligation or duty to such applicants respecting their application. 32 (c) Each and every holder of Securities, by receiving and holding the same, agrees with the Company and the Trustee that neither the Company nor the Trustee nor any Paying Agent nor any registrar shall be held accountable by reason of the disclosure of any such information as to the names and addresses of the holders of Securities in accordance with the provisions of subsection (b) of this Section, regardless of the source from which such information was derived, and that the Trustee shall not be held accountable by reason of mailing any material pursuant to a request made under said subsection (b). (d) If there shall be different Trustees acting hereunder with respect to separate series of Securities, applicants shall make separate applications hereunder to each such Trustee, and such Trustees shall collaborate, if necessary, in acting under this Section. Section 5.03 Annual and Other Reports to Be Filed By Company With Trustee. ------------------------------------------------------------ (a) The Company covenants and agrees to file with the Trustee within fifteen days after the Company is required to file the same with the Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) which the Company may be required to file with the Commission pursuant to Section 13 or Section 15(d) of the Exchange Act; or, if the Company is not required to file information, documents or reports pursuant to either of such Sections, then it will file with the Trustee and the Commission, in accordance with rules and regulations prescribed from time to time by the Commission, such of the supplementary and periodic information, documents and reports which may be required pursuant to Section 13 of the Exchange Act in respect of a security listed and registered on a national securities exchange as may be prescribed from time to time in such rules and regulations. (b) The Company covenants and agrees to file with the Trustee and the Commission, in accordance with the rules and regulations prescribed from time to time by the Commission, such additional information, documents, and reports with respect to compliance by the Company with the conditions and covenants provided for in this Indenture as may be required from time to time by such rules and regulations. (c) The Company covenants and agrees to transmit to the holders of Securities within 30 days after the filing thereof with the Trustee, in the manner and to the extent provided in subsection (c) of SECTION 5.04 with respect to reports pursuant to subsection (a) of said SECTION 5.04, such summaries of any information, documents and reports required to be filed by the Company pursuant to subsections (a) and (b) of this Section as may be required by rules and regulations prescribed from time to time by the Commission. (d) Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee's receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company's compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers' Certificates). Section 5.04 Trustee to Transmit Annual Report to Securityholders. (a) On ---------------------------------------------------- or before March 15, 2002, and on or before March 15 in every year thereafter, if and so long as any Securities are outstanding hereunder, the Trustee shall 33 transmit to the Securityholders as hereinafter in this Section provided, a brief report dated as of the preceding January 15 with respect to any of the following events which may have occurred within the previous twelve (12) months (but if no such event has occurred within such period no report need be transmitted): (1) Any change to its eligibility under SECTION 7.09, and its qualifications under SECTION 7.08; (2) The creation of or any material change to a relationship which, with the occurrence of an Event of Default, would create a conflicting interest within the meaning of the Trust Indenture Act; (3) The character and amount of any advances (and if the Trustee elects so to state, the circumstances surrounding the making thereof) made by the Trustee (as such) which remain unpaid on the date of such report, and for the reimbursement of which it claims or may claim a lien or charge prior to that of the Securities of any series on any property or funds held or collected by it as Trustee, except that the Trustee shall not be required (but may elect) to report such advances if such advances so remaining unpaid aggregate not more than one-half of one percent of the principal amount of the Securities of all series outstanding as of the date of such report; (4) Any change to the amount, interest rate, and maturity date of all other indebtedness owing by the Company (or by any other obligor on the Securities) to the Trustee in its individual capacity, on the date of such report, with a brief description of any property held as collateral security therefor, except indebtedness based upon a creditor relationship arising in any manner described in paragraph (2), (3), (4), or (6) of subsection (b) of SECTION 7.13; (5) Any change to the property and funds, if any, physically in the possession of the Trustee (as such) on the date of such report; (6) Any additional issue of Securities which the Trustee has not previously reported to Securityholders; and (7) Any action taken by the Trustee in the performance of its duties under this Indenture which it has not previously reported to Securityholders and which in its opinion materially affects the Securities of any series, except action in respect of a default, notice of which has been or is to be withheld by it in accordance with the provisions of SECTION 6.07. (b) The Trustee shall transmit to the Securityholders, as hereinafter provided, a brief report with respect to the character and amount of any advances (and if the Trustee elects so to state, the circumstances surrounding the making thereof) made by the Trustee (as such) since the date of the last report transmitted pursuant to the provisions of subsection (a) of this Section (or if such report has not yet been so transmitted, since the date of execution of this Indenture), for the reimbursement of which it claims or may claim a lien or charge prior to that of the Securities of any series on property or funds held or collected by it as Trustee, and which it has not previously reported pursuant to this subsection, except that the Trustee shall not be required (but 34 may elect) to report such advances if such advances so remaining unpaid aggregate not more than ten percent of the principal amount of Securities of all series outstanding as of the date of such report, such report to be transmitted within 90 days after such time. (c) Reports pursuant to this Section shall be transmitted by mail to all holders of Securities of any series, as the names and addresses of such holders shall appear upon the Register of the Securities of such series. (d) A copy of each such report shall, at the time of such transmission to Securityholders, be filed by the Trustee with each stock exchange upon which the Securities of any series are listed and also with the Commission. The Company will promptly notify the Trustee when and as the Securities of any series become listed on any stock exchange. ARTICLE VI REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ------------------------------------------- ON EVENT OF DEFAULT ------------------- Section 6.01 Events of Default Defined. The term "EVENT OF DEFAULT" ------------------------- whenever used herein with respect to Securities of any series shall mean any one of the following events: (a) Default in the payment of any installment of interest upon any of the Securities of such series as and when the same shall become due and payable, and continuance of such default for a period of 30 days (subject to the deferral of any due date in the case of an Extension Period); or (b) Default in the payment of all or any part of the principal of any of the Securities of such series as and when the same shall become due and payable whether upon Maturity, upon any redemption, by declaration or otherwise; or (c) Failure on the part of the Company duly to observe or perform in any material respect any covenants or agreements (other than covenants to pay interest, principal and premium, which are subject to subsections (a) and (b) above of this Section) on the part of the Company in the Securities or in this Indenture (including any supplemental indenture or pursuant to any Officers' Certificate as contemplated by SECTION 2.01) specifically contained for the benefit of the Securities of such series, for a period of 60 days after there has been given, by registered or certified mail, to the Company by the Trustee, or to the Company and the Trustee by the holders of not less than 25% in principal amount of the Securities of such series and all other series so benefited (all series voting as one class) at the time outstanding under this Indenture a written notice specifying such failure and stating that such is a "NOTICE OF DEFAULT" hereunder; or (d) The commencement by the Company of a voluntary case under Chapter 7 or Chapter 11 of the federal Bankruptcy Code or any other similar state or federal law now or hereafter in effect, or the consent by the Company to the entry of a decree or order for relief in an involuntary case under any such law, or the consent by the Company to the appointment of a liquidating agent or committee, conservator or receiver; or 35 (e) The entry of a decree or order for relief by a court having jurisdiction in the premises in respect of the Company in an involuntary case under Chapter 7 or Chapter 11 of the federal Bankruptcy Code or any other similar state or federal law now or hereafter in effect, and the continuance of any such decree or order unstayed and in effect for a period of 90 days, or the appointment of a liquidating agent or committee, conservator or receiver, and the continuance of any such appointment unstayed and in effect for a period of 90 days. If an Event of Default under clauses 6.01(a), 6.01(b) or 6.01(c) shall have occurred and be continuing (but, in the case of clause 6.01(c), only if the Event of Default is with respect to less than all series of Securities then outstanding under this Indenture), unless the principal of all the Securities shall have already become due and payable, either the Trustee or the holders of not less than 25% in principal amount of all the then outstanding Securities of the series as to which such Event of Default under clauses 6.01(a), 6.01(b) or 6.01(c) has occurred (each such series voting as a separate class in the case of an Event of Default under clauses 6.01(a) or 6.01(b), and all such series voting as one class in the case of an Event of Default under clause 6.01(c)), by notice in writing to the Company (and to the Trustee if given by Securityholders) may declare the principal amount (or if Securities of any series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of such series) of all the Securities of such series, or of all such series in the case of an Event of Default under clause 6.01(c), in each case together with any accrued interest, to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable; provided, however, that in the case of the Securities of a series issued to a DPL Trust, if upon an Event of Default, the Trustee or the holders of at least 25% in principal amount of the outstanding Securities of such series fail to declare the principal of all the Securities of that series to be immediately due and payable, the holders of at least 25% in aggregate liquidation amount of the corresponding series of Preferred Securities then outstanding shall have such right by a notice in writing to the Company and the Trustee. If an Event of Default under clauses 6.01(c), 6.01(d), or 6.01(e) shall have occurred and be continuing (but, in the case of clause 6.01(c)), only if the Event of Default is with respect to all Securities then outstanding under the Indenture), then and in each and every such case, unless the principal of all the Securities shall have already become due and payable, either the Trustee or the holders of not less than 25% in principal amount of all the then outstanding Securities of each series as to which such Event of Default under clauses 6.01(c), 6.01(d), or 6.01(e) above has occurred (voting as one class), by notice in writing to the Company (and to the Trustee if given by Securityholders) may declare the principal amount (or if Securities of any series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of such series) of all the Securities as to which the Event of Default under clauses 6.01(c), 6.01(d), or 6.01(e) above has occurred, together with any accrued interest, to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable, anything contained in this Indenture or in the Securities to the contrary notwithstanding; provided, however, that in the case of the Securities of a series issued to a DPL Trust, if upon an Event of Default, the Trustee or the holders of not less than 25% in principal amount of the outstanding Securities of that series fail to declare the principal of all the Securities of that series to be immediately due and payable, the holders of at least 25% in aggregate liquidation amount of the corresponding series of Preferred Securities then outstanding shall have such right by a notice in writing to the Company and the Trustee. The foregoing provisions, however, are subject to the condition that if, at any time after the principal amount (or 36 specified portion thereof) of the Securities of any one or more series (or of all the Securities, as the case may be) shall have been so declared due and payable, and before any judgment or decree for the payment of moneys due shall have been obtained or entered as hereinafter provided, the Company shall pay or shall deposit with the Trustee a sum sufficient to pay all matured installments of interest upon all the Securities of such series (or upon all the Securities, as the case may be) and the principal of any and all Securities of such series (or of any and all the Securities, as the case may be) which shall have become due otherwise than by declaration (with interest on overdue installments of interest to the extent permitted by law and on such principal at the rate or rates of interest borne by, or prescribed therefor in, the Securities of each such series to the date of such payment or deposit) and the amounts payable to the Trustee under SECTION 7.06, and any and all defaults under the Indenture with respect to Securities of such series (or all Securities, as the case may be), other than the nonpayment of principal of and any accrued interest on Securities of such series (or any Securities, as the case may be) which shall have become due by declaration, shall have been cured, remedied or waived as provided in SECTION 6.06, then and in every such case the holders of a majority in principal amount of the Securities of such series (or of all the Securities, as the case may be) then outstanding and as to which such Event of Default has occurred (such series or all series voting as one class, if more than one series are so entitled) by written notice to the Company and to the Trustee, may rescind and annul such declaration and its consequences. In the case of Securities issued to a DPL Trust, should the holders of such Securities fail to annul such declaration and waive such default, the holders of a majority in aggregate liquidation preference of related Preferred Securities shall have such right; but no such rescission and annulment shall extend to or shall affect any subsequent default, or shall impair any right consequent thereon. In case the Trustee, any holder of Securities or any holder of Preferred Securities shall have proceeded to enforce any right under this Indenture and such proceedings shall have been discontinued or abandoned because of such rescission or annulment or for any other reason or shall have been determined adversely to the Trustee, such holder of Securities or such holder of Preferred Securities then and in every such case the Company, the Trustee, the holders of the Securities of such series (or of all the Securities, as the case may be) and the holders of Preferred Securities shall be restored respectively to their former positions and rights hereunder, and all rights, remedies and powers of the Company and the Trustee, the holders of the Securities of such series (or of all the Securities, as the case may be) and the holders of Preferred Securities shall continue as though no such proceedings had been taken. Section 6.02 Covenant of Company to Pay to Trustee Whole Amount Due On --------------------------------------------------------- Securities On Default In Payment of Interest or Principal. The Company covenants - --------------------------------------------------------- that (1) in case default shall be made in the payment of any installment of interest on any of the Securities of any series as and when the same shall become due and payable, and such default shall have continued for a period of 30 days (subject to the deferral of any due date in the case of an Extension Period), or (2) in case default shall be made in the payment of all or any part of the principal of any of the Securities of any series as and when the same shall become due and payable, whether upon Maturity, upon any redemption, by declaration or otherwise, then, upon demand of the Trustee, the Company will pay to the Trustee, for the benefit of the holders of the Securities of such series, the whole amount that then shall have become due and payable on all such Securities of such series for principal or interest, or both, as the case may be, with interest upon the overdue principal and installments of interest (to the extent permitted by law) at the rate or rates of interest borne by or 37 prescribed therefor in the Securities of such series; and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including reasonable compensation to the Trustee, its agents and counsel, and any expenses or disbursements reasonably incurred, and all reasonable advances made hereunder by the Trustee, its agents, attorneys and counsel, except as a result of its negligence or bad faith. In case the Company shall fail forthwith to pay such amounts upon such demand, the Trustee, in its own name and as trustee of an express trust, shall be entitled and empowered to institute any actions or proceedings at law or in equity for the collection of the sums so due and unpaid, and may prosecute any such action or proceeding to judgment or final decree, and may enforce any such judgment or final decree against the Company or any other obligor upon such Securities, and collect in the manner provided by law out of the property of the Company or any other obligor upon such Securities wherever situated the moneys adjudged or decreed to be payable. The Trustee shall be entitled and empowered, either in its own name or as trustee of an express trust, or as attorney-in-fact for the holders of the Securities of any series, or in any one or more of such capacities (irrespective of whether the principal of the Securities of such series shall then be due and payable, whether upon Maturity, upon any redemption, by declaration or otherwise, and irrespective of whether the Trustee shall have made any demand pursuant to the provisions of this Section) to file and prove a claim or claims for the whole amount of principal (or, if the Securities of such series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of such series) and interest owing and unpaid in respect of the Securities of such series and to file such other documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for reasonable compensation of the Trustee, its agents and counsel, and for reimbursement of all expenses and disbursements reasonably incurred, and all reasonable advances made hereunder by the Trustee, its agents and counsel, except as a result of its negligence or willful misconduct) and of the holders of the Securities of such series allowed in any equity receivership, insolvency, bankruptcy, liquidation, arrangement, readjustment, reorganization or any other judicial proceedings relative to the Company or any other obligor on the Securities of such series or their creditors, or their property. The Trustee is hereby irrevocably appointed (and the successive respective holders of the Securities of each series by taking and holding the same shall be conclusively deemed to have so appointed the Trustee) the true and lawful attorney-in-fact of the respective holders of the Securities of such series, with authority to make and file in the respective names of the holders of the Securities of such series, or on behalf of the holders of the Securities of such series as a class, any proof of debt, amendment of proof of debt, claim, petition or other document in any such proceeding and to collect and receive payment of any sums becoming distributable on account thereof, and to execute any such other papers and documents and to do and perform any and all such acts and things for and on behalf of such holders of the Securities of such series, as may be necessary or advisable in the opinion of the Trustee in order to have the respective claims of the Trustee and of the holders of the Securities of such series allowed in any such proceeding, and to collect and receive payment of or on account of such claims and to distribute the same, and any receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the holders, to pay to the Trustee any amount due to it 38 under SECTION 7.06; provided, however, that nothing herein shall be deemed to authorize the Trustee to authorize or consent to or vote for or accept or adopt on behalf of any Securityholder any plan of reorganization, arrangement, adjustment or composition affecting the Securities of such series or the rights of any holder thereof, or to authorize the Trustee to vote in respect of the claim of any holder of Securities of such series in any such proceeding. All rights of action and of asserting claims under this Indenture, or under any of the Securities of any series, may be enforced by the Trustee without the possession of any of the Securities of such series, or the production thereof on any trial or other proceeding relative thereto, and any such suit or proceeding instituted by the Trustee, shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall be, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of such Trustee, its agents and counsel, for the ratable benefit of the holders of the Securities of such series. Section 6.03 Application of Moneys Collected By Trustee. Any moneys ------------------------------------------ collected by the Trustee pursuant to SECTION 6.02 shall be applied in the order following, at the date or dates fixed by the Trustee for the distribution of such moneys, upon presentation of the several Securities in respect of which moneys have been collected, and stamping thereon the payment, if only partially paid, and upon surrender thereof if fully paid: First: To the payment of reasonable costs and expenses of collection, ----- and of all amounts payable to the Trustee under SECTION 7.06; Second: In case the principal of the outstanding Securities in respect ------ of which moneys have been collected shall not have become due and be unpaid, to the payment of any unpaid interest on such Securities, in the order of the maturity of the installments of such interest, with interest upon the overdue installments of interest (so far as permitted by law and to the extent that such interest has been collected by the Trustee) at the rate or rates of interest borne by, or prescribed therefor in, such Securities, such payments to be made ratably to the persons entitled thereto, without discrimination or preference; Third: In case the principal of the outstanding Securities in respect ----- of which such moneys have been collected shall have become due and be unpaid, whether upon Maturity, upon any redemption, by declaration or otherwise, to the payment of the whole amount then owing and unpaid upon such Securities for principal and interest, if any, with interest on the overdue principal and any installments of interest (so far as permitted by law and to the extent that such interest has been collected by the Trustee) at the rate or rates of interest borne by, or prescribed therefor in, such Securities; and in case such moneys shall be insufficient to pay in full the whole amount so due and unpaid upon such Securities, then to the payment of such principal and interest, without preference or priority of principal over interest, or of interest over principal, or of any installment of interest over any other installment of interest, or of any Security over any other Security, ratably to the aggregate of such unpaid principal and interest; and 39 Fourth: To the payment of the remainder, if any, to the Company, its ------ successors or assigns, or to whomsoever may be lawfully entitled to receive the same, or as a court of competent jurisdiction may direct. Section 6.04 Limitation On Suits By Holders of Securities. No holder of any -------------------------------------------- Security of any series shall have any right by virtue or by availing of any provision of this Indenture to institute any suit, action or proceeding in equity or at law upon or under or with respect to this Indenture or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless such holder previously shall have given to the Trustee written notice of default and of the continuance thereof, as herein before provided, and unless also the holders of not less than 25% in principal amount of all the Securities at the time outstanding (considered as one class) shall have made written request upon the Trustee to institute such action, suit or proceeding in its own name as Trustee hereunder and shall have offered to the Trustee such reasonable indemnity as it may require against the costs, expenses and liabilities to be incurred therein or thereby, and the Trustee, for 60 days after its receipt of such notice, request and offer of indemnity, shall have neglected or refused to institute any such action, suit or proceeding and no direction inconsistent with such written request shall have been given to the Trustee pursuant to SECTION 6.06; it being understood and intended, and being expressly covenanted by the taker and holder of every Security with every other taker and holder and the Trustee, that no one or more holders of Securities shall have any right in any manner whatever by virtue or by availing of any provision of this Indenture to affect, disturb or prejudice the rights of the holders of any other of such Securities, or to obtain or seek to obtain priority over or preference to any other such holder, or to enforce any right under this Indenture, except in the manner herein provided and for the equal, ratable and common benefit of all holders of Securities. For the protection and enforcement of the provisions of this Section, each and every Securityholder and the Trustee shall be entitled to such relief as can be given either at law or in equity. Notwithstanding any other provisions in this Indenture, the right of any holder of any Security to receive payment of the principal of and interest on such Security, on or after the respective due dates expressed in such Security (or, in the case of redemption on or after the date fixed for redemption), or to institute suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such holder. Section 6.05 On Event of Default Trustee May Take Appropriate Action. If an ------------------------------------------------------- Event of Default occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the holders of the Securities by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any of such rights, either by suit in equity or by action at law or by proceeding in bankruptcy or otherwise, whether for the specific enforcement of any covenant or agreement contained in this Indenture or in aid of the exercise of any power granted in this Indenture, or to enforce any other legal or equitable right vested in the Trustee by this Indenture or by law. All powers and remedies given by this Article to the Trustee or to the Securityholders shall, to the extent permitted by law, be deemed cumulative and not exclusive of any thereof or of any other powers and remedies available to the Trustee or the holders of the Securities, by judicial proceedings or otherwise, to enforce the performance or observance of the covenants and agreements contained in this Indenture, and no delay or omission of the Trustee, of any holder of any of the Securities or any holder of Preferred Securities to exercise any right or power accruing upon any default occurring and continuing as aforesaid shall impair any such right or power, or 40 shall be construed to be a waiver of any such default or an acquiescence therein; and, subject to the provisions of SECTION 8.04, every power and remedy given by this Article or by law to the Trustee, to the Securityholders or the holders of Preferred Securities may be exercised from time to time, and as often as shall be deemed expedient, by the Trustee, by the Securityholders or by the holders of Preferred Securities, as the case may be. In the case of Securities of a series issued to a DPL Trust, any holder of the corresponding series of Preferred Securities issued by such DPL Trust shall have the right, upon the occurrence of an Event of Default described in SECTION 6.01(A) or (B) above, to institute a suit directly against the Company for enforcement of payment to such holder of principal of (including premium, if any) and interest (including any Additional Interest) on the Securities having a principal amount equal to the aggregate liquidation amount of such Preferred Securities of the corresponding series held by such holder. Section 6.06 Rights of Holders of Majority In Principal Amount of ---------------------------------------------------- Securities to Direct Trustee and to Waive Default. The holders of at least a - ------------------------------------------------- majority in principal amount of the Securities of any one or more series or of all the Securities, as the case may be (voting as one class), at the time outstanding (determined as provided in SECTION 8.04) shall have the right to direct the time, method, and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee under this Indenture with respect to such one or more series; provided, however, that subject to SECTION 7.01, the Trustee shall have the right to decline to follow any such direction if the Trustee being advised by Opinion of Counsel determines that the action so directed may not lawfully be taken, or if the Trustee in good faith shall, by a Responsible Officer or Officers of the Trustee, determine that the proceedings so directed would be illegal or involve it in personal liability or be unduly prejudicial to the rights of Securityholders of such one or more series not parties to such direction, and provided further, that nothing in this Indenture shall impair the right of the Trustee to take any action deemed proper by the Trustee and which is not inconsistent with such direction by such Securityholders of such one or more series. The holders of at least a majority in principal amount of the Securities of all series as to which an Event of Default hereunder has occurred (all series voting as one class) at the time outstanding (determined as provided in SECTION 8.04) and, in the case of any Preferred Securities of a series issued to a DPL Trust, the holders of at least a majority in aggregate liquidation amount of the Preferred Securities issued by such DPL Trust, may waive any past default hereunder with respect to such series and its consequences, except a default in the payment of the principal of or interest on any of such Securities or Preferred Securities or in respect of a covenant or provision hereof which under Article X cannot be modified or amended without the consent of the holder of each Security so affected. Upon any such waiver, such default shall cease to exist and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of this Indenture, but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon. Any such waiver shall be deemed to be on behalf of the holders of all the Securities of such series or, in the case of a waiver by holders of Preferred Securities issued by such DPL Trust, by all holders of Preferred Securities issued by such DPL Trust. Section 6.07 Trustee to Give Notice of Defaults Known to It, But May ------------------------------------------------------- Withhold In Certain Circumstances. The Trustee shall, within 90 days after the - --------------------------------- occurrence of any default hereunder with respect to the Securities of any 41 series, give to the holders of the Securities of such series in the manner and to the extent provided in subsection (c) of SECTION 5.04 with respect to reports pursuant to subsection (a) of said SECTION 5.04, notice of such default actually known to the Trustee unless such default shall have been cured, remedied or waived before the giving of such notice (the term "default" for the purposes of this Section being hereby defined to be the events specified in clauses (c), (d) and (e) of SECTION 6.01 and default in the payment of the principal of or interest on Securities of any series, not including any periods of grace provided for therein, and irrespective of the giving of written notice specified in any such terms, and irrespective of the delivery of any Officers' Certificate provided for in any such terms); provided, however, that, except in the case of default in the payment of the principal of or interest on any of the Securities of such series, the Trustee shall be protected in withholding such notice if and so long as the Board of Directors, the Executive Committee, or a Trust Committee of directors and/or Responsible Officers of the Trustee in good faith determines that the withholding of such notice is in the interest of the holders of the Securities of such series. Section 6.08 Requirement of An Undertaking to Pay Costs In Certain Suits ----------------------------------------------------------- Under The Indenture or Against The Trustee. All parties to this Indenture agree, - ------------------------------------------ and each holder of any Security by his acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees and expenses, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to any suit instituted by the Trustee, to any suit instituted by any holder of Securities of any series, or group of such Securityholders, holding in the aggregate more than ten percent in principal amount of all the Securities (all series considered as one class) outstanding, or to any suit instituted by any Securityholder for the enforcement of the payment of the principal of or interest on any Security, on or after the due date expressed in such Security (or in the case of any redemption, on or after the date fixed for redemption). ARTICLE VII CONCERNING THE TRUSTEE ---------------------- Section 7.01 Upon Event of Default Occurring and Continuing, Trustee Shall ------------------------------------------------------------- Exercise Powers Vested In It, and Use Same Degree of Care and Skill In Their - ---------------------------------------------------------------------------- Exercise, As A Prudent Man Would Use. Except during the continuance of an Event - ------------------------------------ of Default with respect to any series of Securities: (1) the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture with respect to the Securities of such series, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and (2) in the absence of bad faith on its part, the Trustee may, with respect to the Securities of such series, conclusively rely as to the truth of the statements and the correctness of the opinions expressed therein, 42 upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions which by any provision hereof are specially required to be furnished by the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture. In case an Event of Default with respect to any series of Securities has occurred and is continuing, the Trustee shall exercise with respect to the Securities of such series such rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct; provided, however, that (b) Prior to the occurrence of an Event of Default and after the curing, remedying or waiving of all Events of Default which may have occurred: (1) The duties and obligations of the Trustee shall be determined solely by the express provisions of this Indenture and the Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and (2) In the absence of bad faith on the part of the Trustee, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture; (c) The Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer or Officers of the Trustee, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts upon which such judgment was made; (d) The Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the holders of Securities pursuant to SECTION 6.06 relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture; and (e) No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that the repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. Whether or not therein expressly so provided, 43 every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this SECTION 7.01. Section 7.02 Reliance On Documents, Opinions, Etc. Except as otherwise ------------------------------------ provided in SECTION 7.01: (a) The Trustee may conclusively rely and shall be fully protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, appraisal, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed, sent or presented by the proper party or parties; (b) Any request, direction, order or demand of the Company mentioned herein shall be sufficiently evidenced by an Officers' Certificate (unless other evidence in respect thereof be herein specifically prescribed); and any Resolution of the Company may be evidenced to the Trustee by a copy thereof certified by the Secretary or an Assistant Secretary of the Company; (c) The Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted to be taken by it hereunder in good faith and in reliance thereon; (d) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Securityholders pursuant to this Indenture, unless such Securityholders shall have offered to the Trustee such adequate security or indemnity against the costs, expenses (including attorneys' fees and expenses) and liabilities that might be incurred by it in complying with such request or direction; (e) The Trustee shall not be liable for any action taken or omitted to be taken by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture; (f) The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, approval, bond, debenture, note, other evidence of indebtedness or other paper or document, unless requested in writing to do so by the holders of Securities pursuant to SECTION 6.06, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit; provided, however, that if the payment within a reasonable time to the Trustee of the costs, expenses or liabilities likely to be incurred by it in the making of such investigation is, in the opinion of the Trustee, not reasonably assured to the Trustee by the security afforded to it by the terms of this Indenture, the Trustee may require adequate indemnity against such costs, expenses or liabilities as a condition to so proceeding; and provided further, that nothing in this subsection (f) shall require the Trustee to give the Securityholders any notice other than that required by SECTION 6.07. The reasonable expense of every such examination shall be paid by the Company or, if paid by the Trustee, shall be repaid by the Company upon demand; 44 (g) The Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder; (h) The Trustee shall be under no responsibility for the approval by it in good faith of any expert for any of the purposes expressed in this Indenture; (i) The Trustee shall not be charged with knowledge of any default (as defined in Section 6.07) or Event of Default with respect the Securities of any series for which it is acting as Trustee unless either (i) a Responsible Officer of the Trustee assigned to its Corporate Trust Department (or any successor department or division of the Trustee) at the principal office of the Trustee shall have actual knowledge of such default or Event of Default, as the case may be, or (ii) written notice of such default or Event of Default, as the case may be, shall have been received by the Trustee at the principal office of the Trustee from the Company, or any other obligor on such Securities, or from any Holder of such Securities, and such notice references the Securities and this Indenture; (j) The rights, privileges, protections, immunities and benefits given to the Trustee hereunder, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder and to each agent, custodian and other Person employed to act hereunder; and (k) The Trustee may request that the Company deliver an Officers' Certificate setting forth the names of officers authorized at such time to take specified actions pursuant to this Indenture, which Officers' Certificate may be signed by any person authorized to sign an Officers' Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded. Section 7.03 Trustee Not Liable for Recitals In Indenture or In Securities. -------------------------------------------------------------- The recitals contained herein and in the Securities (other than the certificate of authentication on the Securities) shall be taken as the statements of the Company, and the Trustee does not assume any responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities. The Trustee shall not be accountable for the use or application by the Company of the proceeds of the Securities of any series. Section 7.04 May Hold Securities. The Trustee or any agent of the Trustee ------------------- or the Trust, in its individual or any other capacity, may become the owner or pledgee of Securities and, subject to SECTION 7.08, with the same rights it would have if it were not Trustee or such agent. Section 7.05 Moneys Received By Trustee to Be Held In Trust Without ------------------------------------------------------ Interest. Subject to the provisions of SECTION 12.04, all moneys received by the - -------- Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated from other funds except to the extent required by law. The Trustee shall be under no liability for interest on any moneys received by it hereunder. 45 Section 7.06 Trustee Entitled to Compensation, Reimbursement and Indemnity. -------------------------------------------------------------- The Company covenants and agrees to pay to the Trustee from time to time, and the Trustee shall be entitled to, such compensation as shall be agreed to in writing between the Company and the Trustee (which shall not be limited by any provision of law in regard to the compensation of a trustee of any express trust), and, the Company will pay or reimburse the Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the Trustee in accordance with any provision of this Indenture or in connection with the acceptance or administration of its trust under this Indenture (including the reasonable compensation and the reasonable expenses and disbursements of its agents and counsel and of all persons not regularly in its employ) except any such expense, disbursement or advance as may arise from its negligence or willful misconduct. The Company also covenants and agrees to indemnify each of the Trustee, any predecessor Trustee and their agents for, and to hold them harmless against, any loss, liability or expense incurred without negligence or willful misconduct on their part and arising out of or in connection with the acceptance or administration of this trust or performance of their duties hereunder, including the costs and expenses (including reasonable fees and disbursements of their counsel) of defending themselves against any claim (whether asserted by the Company, any holder of Securities or any other Person) or liability in connection with the exercise or performance of any of the powers or duties hereunder. The obligations of the Company under this Section to compensate the Trustee, to pay or reimburse the Trustee for expenses, disbursements and advances and to indemnify and hold harmless the Trustee shall constitute additional indebtedness hereunder. Such additional indebtedness shall be secured by a lien prior to that of the Securities upon all property and funds held or collected by the Trustee as such, except funds held in trust for the payment of principal of or interest, if any, on particular Securities. In addition and without prejudice to the right provided to the Trustee under any of the provisions of this Indenture, when the Trustee incurs expenses or renders services in connection with an Event of Default specified in SECTION 6.01(D) or SECTION 6.01(E), the expenses (including the reasonable charges and expenses of its counsel) and the compensation for the services are intended to constitute expenses of administration under any applicable federal or state bankruptcy, insolvency or other similar law. The obligations of the Company under this Section 7.06 and the lien referred to in this Section 7.06 shall survive the termination of this Indenture, the resignation or removal of the Trustee, the satisfaction or discharge of this Indenture under Article XII and /or any defeasance or discharge under Article XV. The claims of the Trustee under this Section 7.06 shall not be subject to the provisions of Article XIV. Section 7.07 Right of Trustee to Rely On Officers' Certificate Where No ---------------------------------------------------------- Other Evidence Specifically Prescribed. Except as otherwise provided in SECTION - -------------------------------------- 7.01, whenever in the administration of this Indenture the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking, suffering or omitting to take any action hereunder, the Trustee (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of bad faith on its part, request and conclusively rely upon an Officers' Certificate which, upon receipt of such request, shall be promptly delivered by the Company. 46 Section 7.08 Disqualification; Conflicting Interests. If the Trustee of any --------------------------------------- series has or shall acquire any conflicting interest, within the meaning of the Trust Indenture Act, the Trustee shall either eliminate such interest or resign, to the extent and in the manner provided by, and subject to the provisions of, the Trust Indenture Act and this Indenture. In determining whether the Trustee has a conflicting interest as defined in Section 310(b) of the Trust Indenture Act with respect to the Securities of any particular series, there shall be excluded (i) this Indenture with respect to Securities of any particular series of Securities other than that series, (ii) each Guarantee Agreement and (iii) each Trust Agreement. Nothing herein shall prevent the Trustee from filing with the Commission the application referred to in the second to last paragraph of Section 310(b) of the Trust Indenture Act. Section 7.09 Requirements for Eligibility of Trustee. The Trustee hereunder --------------------------------------- shall at all times be a corporation organized and doing business under the laws of the United States or any State or territory thereof or of the District of Columbia authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least $50,000,000, subject to supervision or examination by federal, state, territorial, or District of Columbia authority and having its principal office and place of business in the City of Dayton or in the Borough of Manhattan, The City of New York, if there be such a corporation having its principal office and place of business in said places willing to act upon reasonable and customary terms and conditions. If such corporation publishes reports of condition at least annually, pursuant to law or the requirements of the aforesaid supervising or examining authority, then, for the purposes of this Section and to extent permitted by the Trust Indenture Act, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, the Trustee shall resign immediately in the manner and with the effect specified in SECTION 7.10. Neither the Company, any other obligor upon the Securities, nor any person directly or indirectly controlling, controlled by, or under common control with the Company or any such obligor shall serve as Trustee under this Indenture. Section 7.10 Resignation and Removal of Trustee. (a) The Trustee, or any ---------------------------------- trustee or trustees hereafter appointed, may at any time resign with respect to one or more or all series of Securities by giving written notice of such resignation to the Company and by giving to the holders of Securities of the applicable series notice thereof in the manner and to the extent provided in subsection (c) of SECTION 5.04 with respect to reports pursuant to subsection (a) of SECTION 5.04. Upon receiving such notice of resignation and if the Company shall deem it appropriate evidence satisfactory to it of such mailing, the Company shall promptly appoint a successor Trustee with respect to the applicable series (it being understood that any successor Trustee may be appointed with respect to the Securities of one or more or all of such series and at any time there shall be only one Trustee with respect to the Securities of any particular series) by written instrument, in duplicate, executed pursuant to a Resolution of the Company, one copy of which instrument shall be delivered to the resigning Trustee and one copy to the successor Trustee. If no successor Trustee shall have been so appointed with respect to any series and have accepted appointment within 30 days after the mailing of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor Trustee, or any Securityholder who has been a bona fide holder of a Security or Securities of the applicable series for at least six months may, subject to the provisions of SECTION 6.08, 47 on behalf of himself and all others similarly situated, petition any such court for the appointment of a successor Trustee. Such court may thereupon after such notice, if any, as it may deem proper and prescribe, appoint a successor Trustee. (b) In case at any time any of the following shall occur: (1) The Trustee shall fail to comply with SECTION 7.08 after written request therefor by the Company or by any Securityholder who has been a bona fide holder of a Security or Securities of the applicable series for at least six months, or (2) The Trustee shall cease to be eligible in accordance with the provisions of SECTION 7.09 and shall fail to resign after written request therefor by the Company or by any such Securityholder, or (3) The Trustee shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then, in any such case, the Company may remove the Trustee with respect to the applicable series and appoint a successor Trustee with respect to the applicable series by written instrument, in duplicate, executed pursuant to a Resolution of the Company, one copy of which instrument shall be delivered to the Trustee so removed and one copy to the successor Trustee, or, subject to the provisions of SECTION 6.08, any Securityholder who has been a bona fide holder of a Security or Securities of the applicable series for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee with respect to the applicable series. Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, remove the Trustee and appoint a successor Trustee. (c) The holders of a majority in principal amount of the Securities of any one series voting as a separate class or all series voting as one class at the time outstanding (determined as provided in SECTION 8.04) may at any time remove the Trustee with respect to the applicable series or all series, as the case may be, and appoint a successor Trustee with respect to the applicable series or all series, as the case may be, by written instrument or instruments signed by such holders or their attorneys-in-fact duly authorized, or by the affidavits of the permanent chairman and permanent secretary of a meeting of the Securityholders (as elected in accordance with SECTION 9.05) evidencing the vote upon a resolution or resolutions submitted thereto with respect to such removal and appointment (as provided in Article IX), and by delivery thereof to the Trustee so removed, to the successor Trustee and to the Company. (d) Any resignation or removal of the Trustee and any appointment of a successor Trustee pursuant to any of the provisions of this Section shall become effective upon acceptance of appointment by the successor Trustee as provided in SECTION 7.11. Section 7.11 Acceptance By Successor Trustee. Any successor Trustee with ------------------------------- respect to all series of Securities appointed as provided in SECTION 7.10 shall execute, acknowledge and deliver to the Company and to its predecessor Trustee an instrument accepting such appointment hereunder, and thereupon the 48 resignation or removal of the predecessor Trustee with respect to all or any applicable series shall become effective and such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties with respect to such series of its predecessor hereunder, with like effect as if originally named as Trustee herein; but, on the written request of the Company or of the successor Trustee, the Trustee ceasing to act shall, upon payment of any amounts then due it pursuant to the provisions of SECTION 7.06, execute and deliver an instrument transferring to such successor Trustee all the rights and powers with respect to such series of the Trustee so ceasing to act. Upon the request of any such successor Trustee, the Company shall execute any and all instruments in writing for more fully and certainly vesting in and confirming to such successor Trustee all such rights and powers. Any Trustee ceasing to act shall, nevertheless, retain a lien upon all property or funds held or collected by such Trustee or any successor Trustee to secure any amounts then due it pursuant to the provisions of SECTION 7.06. In case of the appointment hereunder of a successor Trustee with respect to the Securities of one or more (but not all) series, the Company, the retiring Trustee and each successor Trustee with respect to the Securities of such series shall execute and deliver an indenture supplemental hereto wherein each successor Trustee shall accept such appointment and which (1) shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, each successor Trustee all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of such series to which the appointment of such successor Trustee relates, (2) if the retiring Trustee is not retiring with respect to all Securities, shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of such series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee, and (3) shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustees co-Trustees of the same trust and that each such Trustee shall be Trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee; and upon the execution and delivery of such supplemental indenture the resignation or removal of the retiring Trustee shall become effective to the extent provided therein and each such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of such series to which the appointment of such successor Trustee relates; but, on written request of the Company or any successor Trustee, such retiring Trustee shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder with respect to the Securities of such series to which the appointment of such successor Trustee relates. Any Trustee ceasing to act shall, nevertheless, retain a lien upon all property or funds held or collected by such Trustee or any successor Trustee to secure any amounts then due it pursuant to the provisions of SECTION 7.06. No successor Trustee shall accept appointment as provided in this Section unless at the time of such acceptance such successor Trustee shall be qualified under the provisions of SECTION 7.08 and eligible under the provisions of SECTION 7.09. 49 Upon acceptance of appointment by a successor Trustee as provided in this Section, the successor Trustee shall at the expense of the Company transmit notice of the succession of such Trustee hereunder to the holders of Securities of any applicable series in the manner and to the extent provided in subsection (c) of SECTION 5.04 with respect to reports pursuant to subsection (a) of said SECTION 5.04. Section 7.12 Successor to Trustee By Merger, Consolidation or Succession to -------------------------------------------------------------- Business. Any Person into which the Trustee may be merged or converted or with - -------- which it may be consolidated, or any Person resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any Person succeeding to all or substantially all of the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided such Person shall be qualified under the provisions of SECTION 7.08 and eligible under the provisions of SECTION 7.09, without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding. In case at the time such successor to the Trustee shall succeed to the trusts created by this Indenture any of the Securities shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any predecessor Trustee, and deliver such Securities so authenticated; and in case at that time any of the Securities shall not have been authenticated, any successor to the Trustee may authenticate such Securities either in the name of any predecessor hereunder or in the name of the successor Trustee; and in all such cases such certificates shall have the full force which it is anywhere in the Securities or in this Indenture provided that the certificate of the Trustee shall have; provided, however, that the right to adopt the certificate of authentication of any predecessor Trustee or to authenticate Securities in the name of any predecessor Trustee shall apply only to its successor or successors by merger, conversion or consolidation. Section 7.13 Limitations On Rights of Trustee As A Creditor to Obtain -------------------------------------------------------- Payment of Certain Claims Within Three Months Prior to Default or During - ------------------------------------------------------------------------ Default, or to Realize On Property As Such Creditor Thereafter. (a) Subject to - -------------------------------------------------------------- the provisions of subsection (b) of this Section, if the Trustee shall be or shall become a creditor, directly or indirectly, secured or unsecured, of the Company or of any other obligor on the Securities within three months prior to a default, as defined in subsection (c) of this Section, or subsequent to such a default, then, unless and until such default shall be cured, waived or remedied, the Trustee shall set apart and hold in a special account for the benefit of the Trustee individually, the holders of the Securities of the one or more other indenture securities (as defined in subsection (c) of this Section): (1) An amount equal to any and all reductions in the amount due and owing upon any claim as such creditor in respect of principal or interest, effected after the beginning of such three-month period, and valid as against the Company and its other creditors, except any such reduction resulting from the receipt or disposition of any property described in paragraph (2) of this subsection, or from the exercise of any right of set- off which the Trustee could have exercised if a petition in bankruptcy had been filed by or against the Company upon the date of such default; and (2) All property received by the Trustee in respect of any claims as such creditor, either as security therefor, or in satisfaction or composition thereof, or otherwise, after the beginning of such three-month 50 period, or an amount equal to the proceeds of any such property if disposed of, subject, however, to the rights, if any, of the Company and its other creditors in such property or such proceeds. Nothing herein contained, however, shall affect the right of the Trustee: (A) To retain for its own account (i) payments made on account of any such claim by any person (other than the Company) who is liable thereon, (ii) the proceeds of the bona fide sale of any such claim by the Trustee to a third person, and (iii) distributions made in cash, securities, or other property in respect of claims filed against the Company in bankruptcy or receivership or in proceedings for reorganization pursuant to title 11 of the United States Code or applicable state laws; (B) To realize, for its own account, upon any property held by it as security for any such claim, if such property was so held prior to the beginning of such three-month period; (C) To realize, for its own account, but only to the extent of the claim hereinafter mentioned, upon any property held by it as security for any such claim, if such claim was created after the beginning of such three-month period and such property was received as security therefor simultaneously with the creation thereof, and if the Trustee shall sustain the burden of proving that at the time such property was so received, the Trustee had no reasonable cause to believe that a default, as defined in subsection (c) of this Section, would occur within three months; or (D) To receive payment on any claim referred to in paragraph (B) or (C) against the release of any property held as security for such claim as provided in such paragraph (B) or (C), as the case may be, to the extent of the fair value of such property. For the purposes of paragraphs (B), (C), and (D), property substituted after the beginning of such three-month period for property held as security at the time of such substitution shall, to the extent of the fair value of the property released, have the same status as the property released, and to the extent that any claim referred to in any such paragraphs is created in renewal of or in substitution for or for the purpose of repaying or refunding any pre- existing claim of the Trustee as such creditor, such claim shall have the same status as such pre-existing claim. If the Trustee shall be required to account, the funds and property held in such special account and the proceeds thereof shall be apportioned between the Trustee, the holders of Securities of the one or more series for which it is acting as Trustee, and the holders of other indenture securities in such manner that the Trustee, such Securityholders and the holders of other indenture securities realize, as a result of payments from such special account and payments of dividends on claims filed against the Company in bankruptcy or receivership or in proceedings for reorganization pursuant to title 11 of the United States Code or applicable state law, the same percentage of their respective claims, figured before crediting to the claim of the Trustee anything 51 on account of the receipt by it from the Company of the funds and property in such special account and before crediting to the respective claims of the Trustee, such Securityholders, and the holders of other indenture securities dividends on claims filed against the Company in bankruptcy or receivership or in proceedings for reorganization pursuant to title 11 of the United States Code or applicable state law, but after crediting thereon receipts on account of the indebtedness represented by their respective claims from all sources other than from such dividends and from the funds and property so held in such special account. As used in this paragraph, with respect to any claim, the term "dividends" shall include any distribution with respect to such claim in bankruptcy or receivership or in proceedings for reorganization pursuant to title 11 of the United States Code or applicable state law, whether such distribution is made in cash, securities, or other property, but shall not include any such distribution with respect to the secured portion, if any, of such claim. The court in which such bankruptcy, receivership or proceeding for reorganization is pending shall have jurisdiction (i) to apportion among the Trustee, such Securityholders, and the holders of other indenture securities, in accordance with the provisions of this paragraph, the funds and property held in such special account and the proceeds thereof, or (ii) in lieu of such apportionment, in whole or in part, to give to the provisions of this paragraph due consideration in determining the fairness of the distributions to be made to the Trustee, such Securityholders and the holders of other indenture securities with respect to their respective claims, in which event it shall not be necessary to liquidate or to appraise the value of any securities or other property held in such special account or as security for any such claim, or to make a specific allocation of such distributions as between the secured and unsecured portions of such claim, or otherwise to apply the provisions of this paragraph as a mathematical formula. Any Trustee who has resigned or been removed after the beginning of such three-month period shall be subject to the provisions of this subsection (a) as though such resignation or removal had not occurred. If any Trustee has resigned or been removed prior to the beginning of such three-month period, it shall be subject to the provisions of this subsection (a) if and only if the following conditions exist: (i) The receipt of property or reduction of claim which would have given rise to the obligation to account, if such Trustee had continued as trustee, occurred after the beginning of such three-month period; and (ii) Such receipt of property or reduction of claim occurred within three months after such resignation or removal; (b) There shall be excluded from the operation of subsection (a) of this Section a creditor relationship arising from: (1) The ownership or acquisition of securities issued under any indenture, or any security or securities having a maturity of one year or more at the time of acquisition by the Trustee; (2) Advances authorized by a receivership or bankruptcy court of competent jurisdiction, or by this Indenture, for the purpose of preserving any property which shall at any time be subject to the lien of this Indenture or of discharging tax liens or other prior liens or encumbrances 52 thereon, if notice of such advances and of the circumstances surrounding the making thereof is given to the Securityholders at the time and in the manner provided in SECTION 5.04(C) with respect to reports pursuant to subsections (a) and (b) thereof, respectively; (3) Disbursements made in the ordinary course of business in the capacity of Trustee under an indenture, transfer agent, registrar, custodian, paying agent, fiscal agent or depositary, or other similar capacity; (4) An indebtedness created as a result of services rendered or premises rented; or an indebtedness created as a result of goods or securities sold in a cash transaction as defined in subsection (c) of this Section; (5) The ownership of stock or of other securities of a corporation organized under the provisions of Section 25(a) of the Federal Reserve Act, as amended, which is directly or indirectly a creditor of the Company; or (6) The acquisition, ownership, acceptance or negotiation of any drafts, bills of exchange, acceptances or obligations which fall within the classification of self-liquidating paper as defined in subsection (c) of this Section. (c) As used in this Section: (1) The term "default" shall mean any failure to make payment in full of the principal of or interest upon any of the Securities or upon the other indenture securities when and as such principal or interest becomes due and payable. (2) The term "other indenture securities" shall mean securities upon which the Company is an obligor (as defined in the Trust Indenture Act of 1939) outstanding under any other indenture (A) under which the Trustee is also trustee, (B) which contains provisions substantially similar to the provisions of subsection (a) of this Section, and (C) under which a default exists at the time of the apportionment of the funds and property held in said special account. (3) The term "cash transaction" shall mean any transaction in which full payment for goods or securities sold is made within seven days after delivery of the goods or securities in currency or in checks or other orders drawn upon banks or bankers and payable upon demand. (4) The term "self-liquidating paper" shall mean any draft, bill of exchange, acceptance or obligation which is made, drawn, negotiated or incurred by the Company for the purpose of financing the purchase, processing, manufacture, shipment, storage or sale of goods, wares or merchandise and which is secured by documents evidencing title to, possession of, or a lien upon, the goods, wares or merchandise, or the receivables or proceeds arising from the sale of the goods, wares or merchandise previously constituting the security; provided the security is received by the Trustee simultaneously with the creation of the creditor 53 relationship with the Company arising from the making, drawing, negotiating or incurring of the draft, bill of exchange, acceptance or obligation. (5) The term "Company" shall mean any obligor upon the Securities. ARTICLE VIII CONCERNING THE SECURITYHOLDERS ------------------------------ Section 8.01 Evidence of Action By Securityholders. Whenever in this ------------------------------------- Indenture it is provided that the holders of a specified percentage in principal amount of the Securities of any or all series may take any action (including the making of any demand or request, the giving of any notice, consent, or waiver or the taking of any other action), the fact at the time of taking any such action the holders of such specified percentage have joined therein may be evidenced (a) by any instrument or any number of instruments of similar tenor executed by such Securityholders in person or by agent or proxy appointed in writing, or (b) by the record of such holders of Securities voting in favor thereof at any meeting of such Securityholders duly called and held in accordance with the provisions of Article IX, or (c) by a combination of such instrument or instruments and any such record of such a meeting of such Securityholders. If there shall be more than one Trustee acting hereunder with respect to separate series of Securities, such Trustees shall collaborate, if necessary, in acting under Article IX and in determining whether the holders of a specified percentage in principal amount of the Securities of any or all series have taken any such action. Section 8.02 Proof of Execution of Instruments and of Holding of --------------------------------------------------- Securities. Subject to the provisions of SECTIONS 7.01, 7.02 and 9.05, proof of - ---------- the execution of any instrument by a Securityholder or his agent or proxy and proof of the holding by any person of any of the Securities shall be sufficient if made in the following manner: The fact and date of the execution by any such person of any instrument may be proved in any reasonable manner acceptable to the Trustee. The ownership of Securities of any series shall be proved by the Register of such Securities of such series, or by certificates of the Security registrar or registrars thereof. The Trustee shall not be bound to recognize any person as a Securityholder unless and until title to the Securities held by him is proved in the manner in this Article VIII provided. The record of any Securityholders' meeting shall be proved in the manner provided in SECTION 9.06. The Trustee may accept such other proof or require such additional proof of any matter referred to in this Section as it shall deem reasonable. Section 8.03 Who May Be Deemed Owners of Securities. Prior to due -------------------------------------- presentment for registration of transfer of any Security, the Company, the Trustee and any agent of the Company or the Trustee may deem and treat the 54 person in whose name such Security shall be registered upon the Register of Securities of the series of which such Security is a part as the absolute owner of such Security (whether or not payments in respect of such Security shall be overdue and notwithstanding any notation of ownership or other writing thereon) for the purpose of receiving payment of or an account of the principal of and interest, subject to SECTION 2.03, on such Security and for all other purposes; and neither the Company nor the Trustee nor any agent of the Company or the Trustee shall be affected by any notice to the contrary. All such payments so made to any such holder for the time being, or upon his order, shall be valid, and, to the extent of the sum or sums so paid, effectual to satisfy and discharge the liability of moneys payable upon any such Security. Section 8.04 Securities Owned By Company or Controlled or Controlling -------------------------------------------------------- Persons Disregarded for Certain Purposes. In determining whether the holders of - ---------------------------------------- the requisite principal amount of Securities have concurred in any demand, direction, request, notice, vote, consent, waiver or other action under this Indenture, Securities which are owned by the Company or any other obligor on the Securities or by any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company or any other obligor on the Securities shall be disregarded and deemed not to be outstanding for the purpose of any such determination; provided that for the purposes of determining whether the Trustee shall be fully protected in relying on any such demand, direction, request, notice, vote, consent, waiver or other action, only Securities which a Responsible Officer of the Trustee assigned to its principal office actually knows are so owned shall be so disregarded. Securities so owned which have been pledged in good faith may be regarded as outstanding for the purposes of this Section, if the pledgee shall establish to the satisfaction of the Trustee the pledgee's right to vote such Securities and that the pledgee is not a person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company or any such other obligor. Upon request of the Trustee, the Company shall furnish to the Trustee promptly an Officers' Certificate listing and identifying all Securities, if any, known by the Company to be owned or held by or for the account of the Company or any other obligor on the Securities or by any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company or any other obligor on the Securities; and, subject to the provisions of SECTION 7.01, the Trustee shall be entitled to accept such Officers' Certificate as conclusive evidence of the facts therein set forth and of the fact that all Securities not listed therein are outstanding for the purpose of any such determination. Section 8.05 Instruments Executed By Securityholders Bind Future Holders. ----------------------------------------------------------- At any time prior to (but not after) the evidencing to the Trustee, as provided in SECTION 8.01, of the taking of any action by the holders of the percentage in principal amount of the Securities specified in this Indenture in connection with such action, any holder of a Security which is shown by the evidence to be included in the Securities the holders of which have consented to such action may, by filing written notice with the Trustee at its principal office and upon proof of holding as provided in SECTION 8.02, revoke such action so far as concerns such Security. Except as aforesaid any such action taken by the holder of any Security and any direction, demand, request, notice, waiver, consent, vote or other action of the holder of any Security which by any provisions of this Indenture is required or permitted to be given shall be conclusive and binding upon such holder and upon all future holders and owners of such Security, and of any Security issued in lieu thereof or upon registration of transfers thereof, irrespective of whether any notation in regard thereto is 55 made upon such Security. Any action taken by the holders of the percentage in principal amount of the Securities of any or all series specified in this Indenture in connection with such action shall be conclusively binding upon the Company, the Trustee and the holders of all of the Securities of such series subject, however, to the provisions of SECTION 7.01. ARTICLE IX SECURITYHOLDERS' MEETINGS ------------------------- Section 9.01 Purposes for Which Meetings May Be Called. A meeting of ----------------------------------------- holders of Securities of any or all series may be called at any time and from time to time pursuant to the provisions of this Article for any of the following purposes: (1) To give any notice to the Company or to the Trustee, or to give any directions to the Trustee, or to consent to the waiving of any default hereunder and its consequences, or to take any other action authorized to be taken by holders of Securities of any or all series, as the case may be, pursuant to any of the provisions of Article VI; (2) To remove the Trustee and appoint a successor Trustee pursuant to the provisions of Article VII; (3) To consent to the execution of an indenture or indentures supplemental hereto pursuant to the provisions of SECTION 10.02; or (4) To take any other action authorized to be taken by or on behalf of the holders of any specified principal amount of the Securities of any or all series, as the case may be, under any other provision of this Indenture or under applicable law. Section 9.02 Manner of Calling Meetings. The Trustee may at any time call a -------------------------- meeting of Securityholders to take any action specified in SECTION 9.01, to be held at such time and at such place in the Borough of Manhattan, State of New York, as the Trustee shall determine. Notice of every meeting of Securityholders setting forth the time and place of such meeting and in general terms the action proposed to be taken at such meeting, shall be mailed not less than 20 nor more than 60 days prior to the date fixed for the meeting. Section 9.03 Call of Meeting By Company or Securityholders. In case at any --------------------------------------------- time the Company, pursuant to a resolution of its Board of Directors, or the holders of not less than ten percent in principal amount of the Securities of any or all series, as the case may be, then outstanding, shall have requested the Trustee to call a meeting of holders of Securities of any or all series, as the case may be, to take any action authorized in SECTION 9.01 by written request setting forth in reasonable detail the action proposed to be taken at the meeting, and the Trustee shall not have mailed notice of such meeting within 20 days after receipt of such request, then the Company or such holders of Securities in the amount above specified may determine the time and place in the Borough of Manhattan, State of New York for such meeting and may call such meeting to take any action authorized in SECTION 9.01, by mailing notice thereof as provided in SECTION 9.02. 56 Section 9.04 Who May Attend and Vote At Meetings. To be entitled to vote at ----------------------------------- any meeting of Securityholders a person shall (a) be a holder of one or more Securities with respect to which the meeting is being held, or (b) be a person appointed by an instrument in writing as proxy by such holder of one or more Securities. The only persons who shall be entitled to be present or to speak at any meeting of Securityholders shall be the persons entitled to vote at such meeting and their counsel and any representatives of the Trustee and its counsel and any representatives of the Company and its counsel. Section 9.05 Regulations May Be Made By Trustee. Notwithstanding any other ---------------------------------- provisions of this Indenture, the Trustee may make such reasonable regulations as it may deem advisable for any meeting of Securityholders, in regard to proof of the holding of Securities and of the appointment of proxies, and in regard to the appointment and duties of inspectors of votes, the submission and examination of proxies, certificates and other evidence of the right to vote, and such other matters concerning the conduct of the meeting as it shall think fit. Except as otherwise permitted or required by any such regulations, the holding of Securities shall be proved in the manner specified in SECTION 8.02 and the appointment of any proxy shall be proved in the manner specified in said SECTION 8.02; provided, however, that such regulations may provide that written instruments appointing proxies regular on their face, may be presumed valid and genuine without the proof hereinabove or in said SECTION 8.02 specified. The Trustee shall, by an instrument in writing, appoint a temporary chairman of the meeting, unless the meeting shall have been called by the Company or by Securityholders as provided in SECTION 9.03, in which case the Company or the Securityholders calling the meeting, as the case may be, shall in like manner appoint a temporary chairman. A permanent chairman and a permanent secretary of the meeting shall be elected by majority vote of the meeting. Subject to the provisions of SECTION 8.04, at any meeting each Securityholder or proxy shall be entitled to one vote for each $1,000 principal amount of Securities held or represented by him, provided, however, that no vote shall be cast or counted at any meeting in respect of any Security challenged as not outstanding and ruled by the permanent chairman of the meeting to be not outstanding; provided, further, that each holder of Original Issue Discount Securities shall be entitled to one vote for each $1,000 amount which would be due upon acceleration of his Original Issue Discount Security on the date of the meeting. Neither a temporary nor a permanent chairman of the meeting shall have a right to vote other than by virtue of Securities held by him or instruments in writing as aforesaid duly designating him as the person to vote on behalf of other Securityholders. Any meeting of Securityholders duly called pursuant to the provisions of SECTION 9.02 or 9.03 may be adjourned from time to time, and the meeting may be held so adjourned without further notice. At any meeting of Securityholders, the presence of persons holding or representing Securities in principal amount sufficient to take action on the business for the transaction of which such meeting was called shall constitute a quorum, but, if less than a quorum is present, the person or persons holding or representing a majority in principal amount of the Securities represented at the meeting may adjourn such meeting with the same effect for all intents and purposes, as though a quorum had been present. 57 Section 9.06 Manner of Voting At Meetings and Record to Be Kept. The vote -------------------------------------------------- upon any resolution submitted to any meeting of Securityholders shall be by written ballots on which shall be subscribed the signatures of the holders of Securities or of their representatives by proxy and the principal amount or principal amounts of the Securities held or represented by them. The permanent chairman of the meeting shall appoint two inspectors of votes who shall count all votes cast at the meeting for or against any resolution and who shall make and file with the permanent secretary of the meeting their verified written reports in duplicate of all votes cast at the meeting. A record in duplicate of the proceedings of each meeting of Securityholders shall be prepared by the permanent secretary of the meeting and there shall be attached to said record the original reports of the inspectors of votes on any vote by ballot taken thereat and affidavits by one or more persons having knowledge of the facts setting forth a copy of the notice of the meeting and showing that said notice was mailed as provided in SECTION 9.02. The record shall show the principal amount or principal amounts of the Securities voting in favor of, against, or abstaining from voting on, any resolution. The record shall be signed and verified by the affidavits of the permanent chairman and permanent secretary of the meeting and one of the duplicates shall be delivered to the Company and the other to the Trustee to be preserved by the Trustee. Any record so signed and verified shall be conclusive evidence of the matters therein stated. Section 9.07 Exercise of Rights of Trustee, Securityholders and Holders of ------------------------------------------------------------- Preferred Securities Not to Be Hindered or Delayed. Nothing in this Article - -------------------------------------------------- contained shall be deemed or construed to authorize or permit, by reason of any call of a meeting of Securityholders or any rights expressly or impliedly conferred hereunder to make such call any hindrance or delay in the exercise of any right or rights conferred upon or reserved to the Trustee, to the Securityholders or the holders of Preferred Securities under any of the provisions of this Indenture or of the Securities. ARTICLE X SUPPLEMENTAL INDENTURES ----------------------- Section 10.01 Purposes for Which Supplemental Indentures May Be Entered --------------------------------------------------------- Into Without Consent of Securityholders. The Company, when authorized by a - --------------------------------------- Resolution of the Company, and the Trustee may from time to time, and at any time enter into an indenture or indentures supplemental hereto, in form satisfactory to such Trustee (which shall comply with the provisions of the Trust Indenture Act of 1939 as then in effect), for one or more of the following purposes: (a) To evidence the succession of another corporation to the Company, or successive successions, and the assumption by the successor corporation of the covenants, agreements and obligations of the Company pursuant to Article XI hereof , provided, however, that as a condition to entering into any such supplemental indenture or indentures for any of the foregoing purposes, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the holders of the Securities of all series then outstanding will not recognize income, gain or loss for United States federal income tax purposes as a result of the Company and the Trustee entering into such supplemental 58 indenture or indentures, and that such holders will be subject to United States federal income tax on the same amounts, in the same manner and at the same times as would have been the case if the Company and the Trustee had not entered into such supplemental indenture or indentures; (b) To add to the covenants of the Company such further covenants, restrictions or conditions as the Company and the Trustee shall consider to be for the protection of the holders of all or any series of Securities (and if such covenants, restrictions or conditions are to be for the benefit of less than all series of Securities, stating that such covenants, restrictions or conditions are expressly being included solely for the benefit of such series), and to make the occurrence, or the occurrence and continuance, of a default in any such additional covenants, restrictions or conditions a default or an Event of Default permitting the enforcement of all or any of the several remedies provided in this Indenture as herein set forth; provided, however, that in respect to any such additional covenant, restriction or condition such supplemental indenture may provide for a particular period of grace after default (which period may be shorter or longer than that allowed in the case of other defaults) or may provide for an immediate enforcement upon such default or may limit the remedies available to the Trustee upon such default; (c) To add or change any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the issuance of Securities in bearer form, registrable or not registrable as to principal, and with or without interest coupons; (d) To change or eliminate any of the provisions of this Indenture; provided, however, that any such change or elimination shall become effective only when there is no Security of any series outstanding created prior to the execution of such supplemental indenture which is entitled to the benefit of such provision; (e) To establish the form or terms of Securities of any series as permitted by SECTION 2.01 and 2.02; (f) To cure any ambiguity or to correct or supplement any provision contained herein or in any supplemental indenture which may be defective or inconsistent with any other provisions contained herein or in any supplemental indenture, or to make such other provision in regard to matters or questions arising under this Indenture or any supplemental indenture; provided, however, that such action shall not adversely affect the interests of the holders of Securities of any series in any material respect or, in the case of the Securities of a series issued to a DPL Trust and for so long as any of the corresponding series of Preferred Securities issued by such DPL Trust shall remain outstanding, the holders of such Preferred Securities; (g) To mortgage or pledge to the Trustee as security for the Securities any property or assets which the Company may desire to mortgage or pledge as security for the Securities; and (h) To qualify, or maintain the qualification of, the Indenture under the Trust Indenture Act. The Trustee is hereby authorized to join with the Company in the execution of any such supplemental indenture, to make any further appropriate agreements and stipulations which may be therein contained and to accept the conveyance, 59 transfer, mortgage, pledge or assignment of any property thereunder, but the Trustee shall not be obligated to enter into any such supplemental indenture which affects the Trustee's own rights, duties or immunities under this Indenture or otherwise. Any supplemental indenture authorized by the provisions of this Section may be executed by the Company and the Trustee without the consent of the holders of any of the Securities at the time outstanding, notwithstanding any of the provisions of SECTION 10.02. Section 10.02 Modification of Indenture With Consent of Holders of A ------------------------------------------------------ Majority In Principal Amount of Securities. With the consent (evidenced as - ------------------------------------------ provided in SECTION 8.01) of the holders of not less than a majority in principal amount of the Securities of all series at the time outstanding (determined as provided in SECTION 8.04) affected by such supplemental indenture (voting as one class), the Company, when authorized by a Resolution of the Company, and the Trustee may from time to time and at any time enter into an indenture or indentures supplemental hereto (which shall be in conformity with the provisions of the Trust Indenture Act of 1939 as then in effect) for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of any supplemental indenture or of modifying in any manner the rights of the holders of the Securities of each such series; provided, however, that no such supplemental indenture shall (i) change the fixed Maturity of any Securities, or reduce the rate or extend the time of payment of any interest thereon or on any overdue principal amount or reduce the principal amount thereof, or change the provisions pursuant to which the rate of interest on any Security is determined if such change could reduce the rate of interest thereon, or reduce the minimum rate of interest thereon, or reduce any amount payable upon any redemption thereof, or adversely affect any right to convert the Securities in accordance herewith, or reduce the amount to be paid at Maturity or upon redemption in Capital Stock or make the principal thereof or any interest thereon or on any overdue principal amount payable in any coin or currency other than that provided in the Security without the consent of the holder of each Security so affected, (ii) reduce the aforesaid percentage of Securities, the holders of which are required to consent to any such supplemental indenture without the consent of the holders of all Securities then outstanding, (iii) modify any of the provisions of this Section, SECTION 4.07 or SECTION 6.06, except to increase any such percentage or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the holders of all Securities then outstanding or (iv) modify the provisions of Article XIV with respect to the subordination of outstanding Securities of any series in a manner adverse to the holders thereof without the consent of the holder of each Security so affected; provided, however, that, in the case of the Securities of a series issued to a DPL Trust, so long as any of the corresponding series of Preferred Securities issued by such DPL Trust remains outstanding, (i) no such amendment shall be made that adversely affects the holders of such Preferred Securities in any material respect, and no termination of this Indenture shall occur, and no waiver of any Event of Default with respect to such series or compliance with any covenant with respect to such series under this Indenture shall be effective, without the prior consent of the holders of at least a majority of the aggregate liquidation amount of such Preferred Securities then outstanding unless and until the principal (and premium, if any) of the Securities of such series and all accrued and unpaid interest (including any Additional Interest) thereon have been paid in full; and (ii) no amendment shall be made to SECTION 6.05 of this Indenture that would impair the rights of the holders of such Preferred Securities provided therein or to this Indenture that requires the consent of each holder of the Securities 60 of such series without the prior consent of each holder of such Preferred Securities then outstanding unless and until the principal (and premium, if any) of the Securities of such series and all accrued and unpaid interest (including any Additional Interest) thereon have been paid in full. A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of one or more particular series of Securities or Preferred Securities, or which modifies the rights of holders of Securities or holders of Preferred Securities of such series with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture of the holders of Securities or holders of Preferred Securities of any other series. Upon the request of the Company, accompanied by a copy of a Resolution of the Company certified by the Secretary or an Assistant Secretary of the Company authorizing the execution of any such supplemental indenture, and upon the filing with the Trustee of evidence of the consent of Securityholders as aforesaid, the Trustee shall join with the Company in the execution of such supplemental indenture unless such supplemental indenture affects the Trustee's own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion, but shall not be obligated to, enter into such supplemental indenture. It shall not be necessary for the consent of the Securityholders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such consent shall approve the substance thereof. Promptly after the execution by the Company and the Trustee of any supplemental indenture pursuant to the provisions of this Section, the Company shall mail a notice to the holders of Securities of each series so affected, setting forth in general terms the substance of such supplemental indenture. Any failure of the Company to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture. Section 10.03 Effect of Supplemental Indentures. Upon the execution of any --------------------------------- supplemental indenture pursuant to the provisions of this Article, this Indenture shall be and be deemed to be modified and amended in accordance therewith and the respective rights, limitations of rights, obligations, duties and immunities under this Indenture of the Trustee, the Company and the holders of Securities shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes. The Trustee shall be entitled to receive, and subject to the provisions of SECTION 7.01 shall be entitled to rely upon, an Opinion of Counsel as conclusive evidence that any such supplemental indenture complies with the provisions of this Article and stating that the Securities affected by the supplemental indenture, when such Securities are authenticated and delivered by the Trustee and executed and issued by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and binding obligations of the Company, enforceable against the Company in 61 accordance with their terms, except as may be limited by applicable bankruptcy, insolvency, fraudulent conveyance, reorganization or other similar laws affecting creditors' rights and by general equitable principles (whether considered in a proceeding in equity or at law). Section 10.04 Securities May Bear Notation of Changes By Supplemental ------------------------------------------------------- Indentures. Securities authenticated and delivered after the execution of any - ---------- supplemental indenture pursuant to the provisions of this Article, or after any action taken at a Securityholders' meeting pursuant to Article IX, may bear a notation in form approved by the Trustee as to any matter provided for in such supplemental indenture or as to any action taken at any such meeting. If the Company or the Trustee shall so determine, new Securities so modified as to conform, in the opinion of the Trustee and the Board of Directors of the Company, to any modification of this Indenture contained in any such supplemental indenture may be prepared by the Company, authenticated by the Trustee and delivered in exchange for the Securities then outstanding. Section 10.05 Revocation and Effect of Consents. Subject to SECTION 8.05, --------------------------------- until an amendment, supplement, waiver or other action becomes effective, a consent to it by a Securityholder of a Security is a continuing consent conclusive and binding upon such Securityholder and every subsequent Securityholder of the same Security or portion thereof, and of any Security issued upon the registration of transfer thereof or in exchange therefor or in place thereof, even if notation of the consent is not made on any such Security. The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Securityholders entitled to consent to any amendment, supplement or waiver. If a record date is fixed, then, notwithstanding the preceding paragraph, those Persons who were Securityholders at such record date (or their duly designated proxies), and only such Persons, shall be entitled to consent or revoke such consent to such amendment, supplement or waiver, whether or not such Persons continue to be Securityholders after such record date. No such consent shall be valid or effective for more than 180 days after such record date. After an amendment, supplement, waiver or other action becomes effective, it shall bind every Securityholder. ARTICLE XI CONSOLIDATION, MERGER, SALE OR CONVEYANCE ----------------------------------------- Section 11.01 Company May Consolidate, Etc. On Certain Terms. The Company ---------------------------- covenants that it will not merge or consolidate with any other corporation or sell or convey all or substantially all of its assets to any Person unless (i) either the Company shall be the continuing corporation, or the successor corporation (if other than the Company) shall be a corporation organized and existing under the laws of the United States of America or a State thereof or the District of Columbia and such corporation shall expressly assume the due and punctual payment of the principal of and interest on all the Securities, according to their tenor, and the due and punctual performance and observance of all of the covenants and conditions of this Indenture to be performed by the Company by supplemental indenture satisfactory to the Trustee, executed and delivered to the Trustee by such corporation, (ii) the Company or such successor 62 corporation, as the case may be, shall not, immediately after such merger or consolidation, or such sale or conveyance, be in default in the performance of any such covenant or condition, (iii) in the case of Securities of a series issued to a DPL Trust, such consolidation, merger, sale or conveyance is permitted under the relevant Trust Agreement and DPL Guarantee and does not give rise to any breach or violation of such Trust Agreement or DPL Guarantee , and (iv) the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the holders of all Securities will not recognize income, gain or loss for United States federal income tax purposes as a result of such merger, consolidation, sale or conveyance, and that such holders will be subject to United States federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such merger, consolidation, sale or conveyance had not occurred. Section 11.02 Successor Corporation Substituted. In case of any such --------------------------------- consolidation, merger, sale or conveyance and upon any such assumption by the successor corporation, such successor corporation shall succeed to and be substituted for the Company, with the same effect as if it had been named herein as the party of the first part. Such successor corporation thereupon may cause to be signed, and may issue either in its own name or in the name of the Company, any or all of the Securities issuable hereunder which theretofore shall not have been delivered to the Trustee; and upon the order of such successor corporation, instead of the Company, and subject to all the terms, conditions and limitations in this Indenture prescribed, the Trustee shall authenticate and shall deliver any Securities which previously shall have been signed and delivered by the officers of the Company to the Trustee, and any Securities which such successor corporation thereafter shall cause to be signed and delivered to the Trustee. All the Securities so issued shall in all respects have the same legal rank and benefit under this Indenture as the Securities theretofore or thereafter issued in accordance with the terms of this Indenture as though all of such Securities had been issued at the date of the execution hereof. In case of any such consolidation, merger, sale or conveyance such changes in phraseology and form (but not in substance) may be made in the Securities thereafter to be issued as may be appropriate. Section 11.03 Opinion of Counsel to Trustee. The Trustee shall be entitled ----------------------------- to receive, and subject to the provisions of SECTION 7.01 shall be entitled to rely upon, an Opinion of Counsel as conclusive evidence that any such consolidation, merger, sale or conveyance and any such assumption, complies with the provisions of this Article and that all conditions precedent herein provided for relating to such transaction have been complied with. ARTICLE XII SATISFACTION AND DISCHARGE OF INDENTURE, ---------------------------------------- UNCLAIMED MONEYS ---------------- Section 12.01 Satisfaction and Discharge of Indenture. If (a) the Company --------------------------------------- shall deliver to the Trustee for cancellation all Securities of any series theretofore authenticated (other than any Securities of such series which shall have been destroyed, lost or stolen and which shall have been replaced or paid as provided in SECTION 2.07) and not theretofore cancelled, or (b) all the Securities of such series not theretofore cancelled or delivered to the Trustee 63 for cancellation shall have become due and payable, or are by their terms to become due and payable within one year or are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption, and the Company shall deposit with the Trustee as trust funds the entire amount sufficient to pay at Maturity or upon redemption all of such Securities not theretofore cancelled or delivered to the Trustee for cancellation, including principal and any interest due or to become due to such date of Maturity or redemption date, as the case may be, and if in either case the Company shall also pay or cause to be paid all other sums payable hereunder by the Company with respect to Securities of such series, then this Indenture shall cease to be of further effect with respect to Securities of such series, (except as to (i) remaining rights of registration of transfer, conversion, substitution and exchange and the Company's right of optional redemption of Securities of such series, (ii) rights hereunder of holders to receive payments of principal of, and any interest on, the Securities of such series, and other rights, duties and obligations of the holders of Securities of such series as beneficiaries hereof with respect to the amounts, if any, so deposited with the Trustee, and (iii) the rights, obligations and immunities of the Trustee hereunder), and the Trustee, on demand of the Company, and at the cost and expense of the Company, shall execute proper instruments acknowledging satisfaction of and discharging this Indenture. The Company hereby agrees to compensate the Trustee for any services thereafter reasonably and properly rendered and to reimburse the Trustee for any costs or expenses theretofore and thereafter reasonably and properly incurred by the Trustee in connection with this Indenture or the Securities of such series. Notwithstanding the satisfaction and discharge of this Indenture with respect to the Securities of any or all series, the obligations of the Company to the Trustee under SECTION 7.06 and of the Company under SECTION 12.02 AND SECTION 15.06 shall survive. Section 12.02 Application By Trustee of Funds Deposited for Payment of -------------------------------------------------------- Securities. Subject to SECTION 12.04 and SECTION 15.06, all moneys deposited - ---------- with the Trustee pursuant to SECTION 12.01 shall be held in trust and applied by it to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent), to the holders of the particular Securities of such series, for the payment or redemption of which such moneys have been deposited with the Trustee, of all sums due and to become due thereon for principal and interest. Section 12.03 Repayment of Moneys Held By Paying Agent. In connection with ---------------------------------------- the satisfaction and discharge of this Indenture with respect to Securities of any series, all moneys with respect to Securities of such series then held by any Paying Agent under the provisions of this Indenture shall, upon demand of the Company, be paid to the Trustee and thereupon such Paying Agent shall be released from all further liability with respect to such moneys. Section 12.04 Repayment of Moneys Held By Trustee. Any moneys deposited ----------------------------------- with the Trustee or any Paying Agent for the payment of the principal of or any interest on any Securities of any series and not applied but remaining unclaimed by the holders of Securities of such series for two years after the date upon which such payment shall have become due and payable, shall, at the request of the Company, be repaid to the Company by the Trustee or by such Paying Agent; and the holder of any of the Securities of such series entitled to receive such payment shall thereafter look only to the Company for the payment thereof; provided, however, that the Trustee or such Paying Agent, before being required 64 to make any such repayment, shall, upon receipt of a written request of the Company and at the expense of the Company cause to be published once a week for two successive weeks (in each case on any day of the week) in an Authorized Newspaper, or mailed to the registered holders thereof, a notice that said moneys have not been so applied and that after a date named therein any unclaimed balance of said money then remaining will be returned to the Company. ARTICLE XIII IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS, -------------------------------------------------- DIRECTORS AND EMPLOYEES ----------------------- Section 13.01 Incorporators, Stockholders, Officers, Directors and ---------------------------------------------------- Employees of Company Exempt From Individual Liability. No recourse under or upon - ----------------------------------------------------- any obligation, covenant or agreement of this Indenture, or of any Security, or for any claim based thereon or otherwise in respect thereof, shall be had against any incorporator, stockholder, officer, director or employee, as such, past, present or future, of the Company or of any successor corporation, either directly or through the Company, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, it being expressly understood that this Indenture and the obligations issued hereunder are solely corporate obligations, and that no personal liability whatever shall attach to, or is or shall be incurred by, the incorporators, stockholders, officers, directors or employees, as such, of the Company or any successor corporation, or any of them, because of the creation of the indebtedness hereby authorized, or under or by reason of the obligations, covenants or agreements contained in this Indenture or in any of the Securities or implied therefrom; and that any and all such personal liability of every name and nature, either at common law or in equity or by constitution or statute, of, and any and all such rights and claims against every such incorporator, stockholder, officer, director or employee, as such, because of the creation of the indebtedness hereby authorized, or under or by reason of the obligations, covenants or agreements contained in this Indenture or in any of the Securities or implied therefrom are hereby expressly waived and released as a condition of and as a consideration for, the execution of this Indenture and the issue of such Securities. ARTICLE XIV SUBORDINATION OF SECURITIES --------------------------- Section 14.01 Agreement to Subordinate. The Company, for itself, its ------------------------ successors and assigns, covenants and agrees, and each holder of a Security of any series likewise covenants and agrees by his acceptance thereof, that the obligation of the Company to make any payment on account of the principal of and interest on each and all of the Securities of any series shall be subordinate and junior in right of payment to the Company's obligations to the holders of Senior Indebtedness of the Company, and that in the case of any insolvency, receivership, conservatorship, reorganization, readjustment of debt, marshalling of assets and liabilities or similar proceedings or any liquidation or winding- up of or relating to the Company as a whole, whether voluntary or involuntary, all obligations of the Company to holders of Senior Indebtedness of the Company 65 shall be entitled to be paid in full in cash before any payment shall be made on account of the principal of or interest on any of the Securities (except that Holders may receive payments and other distributions made from any defeasance trust created pursuant to SECTION 15.01 hereof). In the event of any such proceeding, after payment in full in cash of all sums owing with respect to Senior Indebtedness of the Company, the holders of the Securities of each series, together with the holders of any obligations of the Company ranking on a parity with the Securities, shall be entitled to be paid from the remaining assets of the Company the amounts at the time due and owing on account of unpaid principal of and interest on the Securities of any series before any payment or other distribution, whether in cash, property or otherwise, shall be made on account of any capital stock or any obligations of the Company ranking junior to the Securities. In addition, in the event of any such proceeding, if any payment or distribution of assets of the Company of any kind or character whether in cash, property or securities, including any such payment or distribution which may be payable or deliverable by reason of the payment of any other indebtedness of the Company being subordinated to the payment of the Securities of any series shall be received by the Trustee or the holders of the Securities of any series before all Senior Indebtedness of the Company is paid in full, such payment or distribution shall be held in trust for the benefit of and shall be paid over to the holders of such Senior Indebtedness of the Company or their representative or representatives or to the trustee or trustees under any indenture under which any instruments evidencing any of such Senior Indebtedness of the Company may have been issued, ratably, for application to the payment of all Senior Indebtedness of the Company remaining unpaid until all such Senior Indebtedness of the Company shall have been paid in full, after giving effect to any concurrent payment or distribution to the holders of such Senior Indebtedness of the Company. The obligations of the Company in respect of the Securities of all series shall rank on a parity with any obligations of the Company ranking on a parity with the Securities. Nothing in this SECTION 14.01 shall apply to claims of, or payments to, the Trustee under or pursuant to SECTION 7.06. The subordination provisions of the foregoing paragraph shall not be applicable to amounts at the time due and owing on the Securities of any series on account of the unpaid principal of or interest on the Securities of such series for the payment of which funds have been deposited in trust with the Trustee or any Paying Agent or have been set aside by the Company in trust in accordance with the provisions of this Indenture; nor shall such provisions impair any rights, interests, or powers of any secured creditor of the Company in respect of any security the creation of which is not prohibited by the provisions of this Indenture. The Company shall give prompt written notice to the Trustee of any insolvency, receivership, conservatorship, reorganization, readjustment of debt, marshalling of assets and liabilities or similar proceedings or any liquidation or winding-up of or relating to the Company as a whole, whether voluntary or involuntary. The Trustee, subject to the provisions of SECTION 7.01, shall be entitled to assume that, and may act as if, no such event has occurred unless a Responsible Officer of the Trustee assigned to the Trustee's corporate trust department has received at the principal office of the Trustee from the Company or any one or more holders of Senior Indebtedness of the Company or any trustee therefor (who shall have been certified or otherwise established to the satisfaction of the Trustee to be such a holder or trustee) written notice thereof. Upon any distribution of assets of the Company referred to in this Article, the Trustee and holders of the Securities of each series shall be entitled to rely conclusively upon any order or decree of a court of competent jurisdiction in which proceedings relating to any event specified in the first 66 sentence of this paragraph are pending for the purpose of ascertaining the persons entitled to participate in such distribution, the holders of the Senior Indebtedness of the Company, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon, and all other facts pertinent thereto or to this Article, and the Trustee, subject to the provisions of Article VII, and the holders of the Securities of each series shall be entitled to rely conclusively upon a certificate of the liquidating trustee or agent or other person making any distribution to the Trustee or to the holders of the Securities of each series for the purpose of ascertaining the persons entitled to participate in such distribution, the holders of the Senior Indebtedness of the Company, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Article. In the absence of any such liquidating trustee, agent or other person, the Trustee shall be entitled to rely conclusively upon a written notice by a Person representing himself to be a holder of Senior Indebtedness of the Company (or a trustee or representative on behalf of such holder) as evidence that such Person is a holder of such Senior Indebtedness (or is such a trustee or representative). In the event that the Trustee determines, in good faith, that further evidence is required with respect to the right of any Person, as a holder of Senior Indebtedness of the Company, to participate in any payment or distribution pursuant to this Section, the Trustee may request such Person to furnish evidence to the reasonable satisfaction of the Trustee as to the amount of such Senior Indebtedness held by such Person, as to the extent to which such Person is entitled to participation in such payment or distribution, and as to other facts pertinent to the rights of such Person under this Section, and if such evidence is not furnished, the Trustee may defer any payment to such Person pending judicial determination as to the right of such Person to receive such payment. Section 14.02 Obligation of The Company Unconditional. Nothing contained in --------------------------------------- this Article or elsewhere in this Indenture is intended to or shall impair, as between the Company and the holders of the Securities of each series, the obligation of the Company, which is absolute and unconditional, to pay to such holders the principal of and interest on such Securities of each series when, where and as the same shall become due and payable, all in accordance with the terms of such Securities, or is intended to or shall affect the relative rights of such holders and creditors of the Company other than the holders of the Senior Indebtedness of the Company, nor shall anything herein or therein prevent the Trustee or the holder of any Security from exercising all remedies otherwise permitted by applicable law upon default under this Indenture, subject to the rights, if any, under this Article of the holders of Senior Indebtedness of the Company in respect of cash, property, or securities of the Company received upon the exercise of any such remedy. Section 14.03 Limitations On Duties to Holders of Senior Indebtedness of ---------------------------------------------------------- The Company. With respect to the holders of Senior Indebtedness of the Company, - ----------- the Trustee undertakes to perform or to observe only such of its covenants and obligations as are specifically set forth in this Article, and no implied covenants or obligations with respect to the holders of Senior Indebtedness of the Company shall be read into this Indenture against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior Indebtedness of the Company, except with respect to moneys held in trust pursuant to the first paragraph of SECTION 14.01. 67 Section 14.04 Notice to Trustee of Facts Prohibiting Payment. ---------------------------------------------- Notwithstanding any of the provisions of this Article or any other provisions of this Indenture, the Trustee shall not at any time be charged with knowledge of the existence of any facts which would prohibit the making of any payment of moneys to or by the Trustee unless and until a Responsible Officer of the Trustee assigned to its corporate trust department shall have received at the principal office of the Trustee written notice thereof from the Company or from one or more holders of Senior Indebtedness of the Company or from any trustee therefor who shall have been certified by the Company or otherwise established to the reasonable satisfaction of the Trustee to be such a holder or trustee; and, prior to the receipt of any such written notice, the Trustee, subject to the provisions of SECTION 7.01, shall be entitled in all respects to assume that no such facts exist; provided, however, that, if prior to the fifth Business Day preceding the date upon which by the terms hereof any such moneys may become payable for any purpose, or in the event of the execution of an instrument pursuant to SECTION 12.01 acknowledging satisfaction and discharge of this Indenture, then if prior to the second Business Day preceding the date of such execution, the Trustee shall not have received with respect to such moneys the notice provided for in this Section, then, anything herein contained to the contrary notwithstanding, the Trustee shall have full power and authority to receive such moneys and/or apply the same to the purpose for which they were received, and shall not be affected by any notice to the contrary which may be received by it on or after such date; provided, however, no such application shall affect the obligations under this Article of the Persons receiving such moneys from the Trustee. The Trustee shall be entitled to rely on the delivery to it of a written notice by a Person representing himself to be a holder of Senior Indebtedness (or a trustee therefor) to establish that such notice has been given by a holder of Senior Indebtedness (or a trustee therefor). In the event that the Trustee determines in good faith that further evidence is required with respect to the right of any Person as a holder of Senior Indebtedness to participate in any payment or distribution pursuant to this Article, the Trustee may request such Person to furnish evidence to the reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness held by such Person, to the extent to which such Person is entitled to participate in such payment or distribution and any other facts pertinent to the rights of such Person under this Article, and if such evidence is not furnished, the Trustee may defer any payment to such Person pending judicial determination as to the right of such Person to receive such payment. Section 14.05 Application By Trustee of Moneys Deposited With It. Anything -------------------------------------------------- in this Indenture to the contrary notwithstanding, any deposit of moneys by the Company with the Trustee or any agent (whether or not in trust) for any payment of the principal of or interest on any Securities shall, except as provided in SECTION 14.04, be subject to the provisions of SECTION 14.01. Section 14.06 Subrogation. Subject to the payment in full of all Senior ----------- Indebtedness of the Company, the holders of the Securities of each series shall be subrogated to the rights of the holders of such Senior Indebtedness to receive payments or distributions of assets of the Company applicable to such Senior Indebtedness until the Securities shall be paid in full, and none of the payments or distributions to the holders of such Senior Indebtedness to which the holders of the Securities of any series or the Trustee would be entitled except for the provisions of this Article or of payments over pursuant to the provisions of this Article to the holders of such Senior Indebtedness by the holders of such Securities or the Trustee shall, as among the Company, its 68 creditors other than the holders of such Senior Indebtedness, and the holders of such Securities, be deemed to be a payment by the Company to or on account of such Senior Indebtedness; it being understood that the provisions of this Article are and are intended solely for the purpose of defining the relative rights of the holders of such Securities, on the one hand, and the holders of the Senior Indebtedness of the Company, on the other hand. Section 14.07 Subordination Rights Not Impaired By Acts or Omissions of --------------------------------------------------------- Company or Holders of Senior Indebtedness of The Company. No right of any - -------------------------------------------------------- present or future holders of any Senior Indebtedness of the Company to enforce subordination as herein provided shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of the Company or by any act or failure to act, in good faith, by any such holder, or by any noncompliance by the Company with the terms, provisions and covenants of this Indenture, regardless of any knowledge thereof with which any such holder may have or be otherwise charged. The holders of Senior Indebtedness of the Company may, at any time or from time to time and in their absolute discretion, change the manner, place or terms of payment, change or extend the time of payment of, or renew or alter, any such Senior Indebtedness of the Company, or amend or supplement any instrument pursuant to which any such Senior Indebtedness of the Company is issued or by which it may be secured, or release any security therefor, or exercise or refrain from exercising any other of their rights under the Senior Indebtedness of the Company including, without limitation, the waiver of default thereunder, all without notice to or assent from the holders of the Securities of each series or the Trustee and without affecting the obligations of the Company, the Trustee or the holders of such Securities under this Article. Section 14.08 Authorization of Trustee to Effectuate Subordination of ------------------------------------------------------- Securities. Each holder of a Security of any series, by his acceptance thereof, - ---------- authorizes and expressly directs the Trustee on his behalf to take such action as may be necessary or appropriate to effectuate, as between the holders of such Securities and the holders of Senior Indebtedness of the Company, the subordination provided in this Article. If, in the event of any proceeding or other action relating to the Company referred to in the first sentence of SECTION 14.01, a proper claim or proof of debt in the form required in such proceeding or action is not filed by or on behalf of the holders of the Securities of any series prior to fifteen days before the expiration of the time to file such claim or claims, then the holder or holders of Senior Indebtedness of the Company shall have the right to file and are hereby authorized to file an appropriate claim for and on behalf of the holders of such Securities. Section 14.09 No Payment When Senior Indebtedness In Default. In the event ---------------------------------------------- and during the continuation of any default in the payment of principal of (or premium, if any) or interest on any Senior Indebtedness, or in the event that any event of default with respect to any Senior Indebtedness shall have occurred and be continuing and shall have resulted in such Senior Indebtedness becoming or being declared due and payable prior to the date on which it would otherwise have become due and payable, unless and until such event of default shall have been cured, waived or remedied or shall have ceased to exist and such acceleration shall have been rescinded or annulled, or in the event any judicial proceeding shall be pending with respect to any such default in payment or such event or default, then no payment or distribution of any kind or character, whether in cash, properties or securities shall be made by the Company on account of principal of (or premium, if any) or interest (including any Additional Interest) if any, on the Securities or on account of the purchase or other acquisition of Securities by the Company or any Subsidiary (except that 69 Holders of Securities may receive payments and other distributions made from any defeasance trust created pursuant to SECTION 15.01 hereof). In the event that, notwithstanding the foregoing, the Company shall make any payment to the Trustee or the holder of any Security prohibited by the foregoing provisions of this Section, and if such fact shall, at or prior to the time of such payment, have been made known to a Responsible Officer of the Trustee assigned to the principal office of the Trustee or, as the case may be, such holder, then and in such event payment shall be paid over and delivered forthwith to the Company. Section 14.10 Right of Trustee to Hold Senior Indebtedness of The Company. ----------------------------------------------------------- The Trustee shall be entitled to all of the rights set forth in this Article in respect of any Senior Indebtedness of the Company at any time held by it in its individual capacity to the same extent as any other holder of such Senior Indebtedness, and nothing in this Indenture shall be construed to deprive the Trustee of any of its rights as such holder. Section 14.11 Article XIV Not to Prevent Defaults. The failure to make a ----------------------------------- payment pursuant to the terms of Securities of any series by reason of any provision in this Article shall not be construed as preventing the occurrence of a default under this Indenture. ARTICLE XV LEGAL DEFEASANCE AND COVENANT DEFEASANCE ---------------------------------------- Section 15.01 Option to Effect Legal Defeasance or Covenant Defeasance. The -------------------------------------------------------- Company may, at the option of its Board of Directors evidenced by a resolution set forth in an Officers' Certificate, at any time, elect to have either SECTION 15.02 or 15.03 be applied to all outstanding Securities of a series upon compliance with the conditions set forth below in this Article XV. Section 15.02 Legal Defeasance and Discharge. Upon the Company's exercise ------------------------------ under SECTION 15.01 of the option applicable to this SECTION 15.02, the Company shall, subject to the satisfaction of the conditions set forth in SECTION 15.04, be deemed to have been discharged from its obligations with respect to all outstanding Securities of a series on the date the conditions set forth below are satisfied (hereinafter, "LEGAL DEFEASANCE"). For this purpose, Legal Defeasance means that the Company shall be deemed to have paid and discharged the entire indebtedness represented by the outstanding Securities of such series, which shall thereafter be deemed to be "outstanding" only for the purposes of SECTION 15.05 and the other Sections of this Indenture referred to in (a) and (b) below, and to have satisfied all its other obligations under such Securities of such series and this Indenture (and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Securities of such series to receive solely from the trust fund described in SECTION 15.04, and as more fully set forth in such Section, payments in respect of the principal of or interest or premium, if any, on such Securities of such series when such payments are due from the trust referred to below, (b) the Company's obligations with respect to such Securities of such series under ARTICLE II and SECTION 4.02, (c) the rights (including the rights 70 of the Trustee under Section 7.06), powers, trusts, duties and immunities of the Trustee hereunder and the Company's obligations in connection therewith and (d) this Article XV. Subject to compliance with this Article XV, the Company may exercise its option under this SECTION 15.02 notwithstanding the prior exercise of its option under SECTION 15.03. Section 15.03 Covenant Defeasance. Upon the Company's exercise under ------------------- SECTION 15.01 of the option applicable to this SECTION 15.03, the Company shall, subject to the satisfaction of the conditions set forth in SECTION 15.04 hereof, be released from its obligations under the covenants contained in SECTION 4.09 hereof and SECTION 11.01 hereof with respect to the outstanding Securities of such series on and after the date the conditions set forth in SECTION 15.04 are satisfied (hereinafter, "COVENANT DEFEASANCE"), and the Securities of such series shall thereafter be deemed not "outstanding" for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed "outstanding" for all other purposes hereunder (it being understood that such Securities of such series shall not be deemed outstanding for accounting purposes). For this purpose, Covenant Defeasance means that, with respect to the outstanding Securities of such series, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under SECTION 6.01, but, except as specified above, the remainder of this Indenture and such Securities of such series shall be unaffected thereby. In addition, upon the Company's exercise under SECTION 15.01 of the option applicable to this SECTION 15.03, subject to the satisfaction of the conditions set forth in SECTION 15.04, SECTION 6.01(C) shall not constitute Events of Default. Section 15.04 Conditions to Legal or Covenant Defeasance. The following ------------------------------------------ shall be the conditions to the application of either SECTION 15.02 or 15.03 to the outstanding Securities of such series: In order to exercise either Legal Defeasance or Covenant Defeasance: (a) the Company must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders, cash in United States dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal of, premium, if any, and interest on the outstanding Securities of such series on the stated date for payment thereof or on the applicable redemption date, as the case may be, and the Company must specify whether the Securities of such series are being defeased to maturity or to a particular redemption date; (b) in the case of an election under SECTION 15.02 hereof, the Company shall have delivered to the Trustee an Opinion of Counsel in the United States confirming that (A) the Company has received from, or there has been published by, the Internal Revenue Service a ruling or (B) since the date of this Indenture, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the Holders of the outstanding Securities of such series will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same 71 amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred; (c) in the case of an election under SECTION 15.03 hereof, the Company shall have delivered to the Trustee an Opinion of Counsel in the United States confirming that the Holders of the outstanding Securities of such series will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred; (d) no Default or Event of Default shall have occurred and be continuing on the date of such deposit (other than a Default or Event of Default resulting from the incurrence of indebtedness or issuance of redeemable stock all or a portion of the proceeds of which will be used to defease the Securities of such series pursuant to this Article XV concurrently with such incurrence); (e) such Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under, any material agreement or instrument (other than this Indenture) to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound; (f) the Company shall have delivered to the Trustee an Officers' Certificate stating that the deposit was not made by the Company with the intent of preferring the Holders over any other creditors of the Company or with the intent of defeating, hindering, delaying or defrauding creditors of the Company or others; and (g) the Company shall have delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for or relating to the Legal Defeasance or the Covenant Defeasance have been complied with. Section 15.05 Deposited Money and Government Securities to be Held in ------------------------------------------------------- Trust; Other Miscellaneous Provisions. Subject to SECTION 15.06, all money and - ------------------------------------- non-callable Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this SECTION 15.05, the "TRUSTEE") pursuant to SECTION 15.04 in respect of the outstanding Securities of such series shall be held in trust and applied by the Trustee, in accordance with the provisions of such Securities of such series and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as Paying Agent) as the Trustee may determine, to the Holders of such Securities of such series of all sums due and to become due thereon in respect of principal, premium, if any, and interest, but such money need not be segregated from other funds except to the extent required by law. The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or non-callable Government Securities deposited pursuant to SECTION 15.04 or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the outstanding Securities of such series. 72 Anything in this Article XV to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon the request of the Company any money or non-callable Government Securities held by it as provided in SECTION 15.04 which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee (which may be the opinion delivered under SECTION 15.04(A)), are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance. Section 15.06 Repayment to Company. Any money deposited with the Trustee or -------------------- any Paying Agent, or then held by the Company, in trust for the payment of the principal of, premium, if any, or interest on any Security of such series and remaining unclaimed for two years after such principal, and premium, if any, or interest has become due and payable shall be paid to the Company on its request or (if then held by the Company) shall be discharged from such trust; and the Holder of such Security of such series shall thereafter look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, shall upon a written request of the Company and at the expense of the Company cause to be published once, in the New York Times and The Wall Street Journal (national edition), notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such notification or publication, any unclaimed balance of such money then remaining will be repaid to the Company. Section 15.07 Reinstatement. If the Trustee or Paying Agent is unable to ------------- apply any United States dollars or non-callable Government Securities in accordance with SECTION 15.02 or 15.03, as the case may be, by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company's obligations under this Indenture and the Securities of such series shall be revived and reinstated as though no deposit had occurred pursuant to SECTION 15.02 or 15.03 until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with SECTION 15.02 or 15.03, as the case may be; provided, however, that, if the Company makes any payment of principal of, premium, if any, or interest on any Security of such series following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities of such series to receive such payment from the money held by the Trustee or Paying Agent. ARTICLE XVI MISCELLANEOUS PROVISIONS ------------------------ Section 16.01 Successors and Assigns of Company Bound By Indenture. All the ---------------------------------------------------- covenants, stipulations, promises and agreements in this Indenture contained by or in behalf of the Company shall bind its successors and assigns, whether so expressed or not. Section 16.02 Acts of Board, Committee or Officer of Successor Corporation ------------------------------------------------------------ Valid. Any act or proceeding by any provision of this Indenture authorized or - ----- required to be done or performed by any board, committee or officer or officers of the Company shall and may be done and performed with like force and effect by 73 the like board, committee or officer or officers of any corporation that shall at the time be the lawful sole successor of the Company. Section 16.03 Required Notices or Demands May Be Served By Mail. Any notice ------------------------------------------------- or demand which by any provision of this Indenture is required or permitted to be given or served by the Trustee, by the holders of Securities or by the holders of Preferred Securities to or on the Company may be given or served by registered mail postage prepaid addressed (until another address is filed by the Company with the Trustee for such purpose), as follows: DPL Inc., Courthouse Plaza Southwest, Dayton, Ohio 45402, Attention: General Counsel. Except as otherwise provided herein, any notice, direction, request, demand, consent or waiver by the Company, by any Securityholder or by any holder of a Preferred Security to or upon the Trustee shall be deemed to have been sufficiently given, made or filed, for all purposes, if given, made or filed in writing to or with the Trustee at the principal office of the Trustee, The Bank of New York, 101 Barclay Street, Floor 21 West, New York, New York 10286, Attention: Corporate Trust Administration. Section 16.04 Officers' Certificate and Opinion of Counsel to Be Furnished ------------------------------------------------------------ Upon Applications or Demands By The Company. Upon any request or application by - ------------------------------------------- the Company to the Trustee to take any action under any of the provisions of this Indenture, the Company shall furnish to the Trustee an Officers' Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent have been complied with, except that in the case of any such application or demand as to which furnishing of such document is specifically required by any provision of this Indenture relating to such particular application or demand no additional certificate or opinion need be furnished. Each certificate or opinion provided for in this Indenture and delivered to the Trustee with respect to compliance with a condition or covenant provided for in this Indenture, other than certificates provided pursuant to SECTION 4.06, shall include (1) a statement that the person making such certificate or opinion has read such covenant or condition; (2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (3) a statement that, in the opinion of such person, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and (4) a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with. Any certificate, statement or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon a certificate or opinion of or representations by counsel, unless such officer knows that the certificate or opinion or representations with respect to the matters upon which his certificate, statement or opinion may be based as aforesaid are erroneous, or in the exercise of reasonable care should know that the same are erroneous. Any certificate, statement or opinion of counsel may be based, insofar as it relates to factual matters, upon the certificate, statement or opinion of or representations by an officer or officers of the Company stating that the information with respect to such factual matters is in the possession of the Company, unless such counsel knows that the certificate, statement or opinion or representations with respect to the matters upon which his certificate, 74 statement or opinion may be based as aforesaid are erroneous, or in the exercise of reasonable care should know that the same are erroneous. Any certificate, statement or opinion of an officer of the Company or of counsel may be based, insofar as it relates to accounting matters, upon a certificate or opinion of or representations by an accountant or firm of accountants, unless such officer or counsel, as the case may be, knows that the certificate or opinion or representations with respect to the accounting matters upon which his certificate, statement or opinion may be based as aforesaid are erroneous, or in the exercise of reasonable care should know that the same are erroneous. Any certificate or opinion of any independent firm of public accountants filed with the Trustee shall contain a statement that such firm is independent. Section 16.05 Payments Due On Saturdays, Sundays, and Holidays. In any case ------------------------------------------------ where the date of payment of interest on or principal of the Securities of any series or the date fixed for any redemption of any Security of any series shall not be a Business Day, then payment of interest or principal need not be made on such date, but shall be made on the next succeeding Business Day with the same force and effect as if made on the date fixed for the payment of interest on or principal of the Security or the date fixed for any redemption of any Security of such series, and no additional interest shall accrue for the period after such date and before payment. Section 16.06 Provisions Required By Trust Indenture Act of 1939 to ----------------------------------------------------- Control. If and to the extent that any provision of this Indenture limits, - ------- qualifies or conflicts with another provision included in this Indenture which is required to be included in this Indenture by any of Sections 310 to 317, inclusive, of the Trust Indenture Act through operation of Section 318(c) thereof, such required provision shall control. Section 16.07 Indenture and Securities to Be Construed In Accordance With ----------------------------------------------------------- The Laws of The State of New York. This Indenture and each Security shall be - --------------------------------- deemed to be a contract made under the laws of the State of New York, and for all purposes shall be governed by and construed in accordance with the laws of said State (including without limitation Section 5-1401 of the New York General Obligations Law or successor to such statute). Section 16.08 Provisions of The Indenture and Securities for The Sole ------------------------------------------------------- Benefit of The Parties and The Securityholders. Nothing in this Indenture or in - ---------------------------------------------- the Securities, expressed or implied, shall give or be construed to give any person, firm or corporation, other than the parties hereto and their successors and assigns and the holders of the Securities, any legal or equitable right, remedy or claim under or in respect of this Indenture, or under any covenant, condition and provision herein contained; all its covenants, conditions and provisions being for the sole benefit of the parties hereto and their successors and assigns and of the holders of the Securities and, to the extent expressly provided in SECTIONS 6.01, 6.05, 6.06, 9.07, 10.01 and 10.02, the holders of Preferred Securities. Section 16.09 Indenture May Be Executed In Counterparts. This Indenture may ----------------------------------------- be executed in any number of counterparts, each of which shall be an original; but such counterparts shall together constitute but one and the same instrument. 75 Section 16.10 Securities In Foreign Currencies. Whenever this Indenture -------------------------------- provides for any action by, or any distribution to, holders of Securities denominated in United States dollars and in any other currency, in the absence of any provision to the contrary in the form of Security of any particular series, the relative amount in respect of any Security denominated in a currency other than United States dollars shall be treated for any such action or distribution as that amount of United States dollars that could be obtained for such amount on such reasonable basis of exchange and as of such date as the Company may specify in a written notice to the Trustee. The Bank of New York, the party of the second part, hereby accepts the trusts in this Indenture declared and provided, upon the terms and conditions, herein above set forth. 76 IN WITNESS WHEREOF, DPL Inc., the party of the first part, has caused this Indenture to be signed and acknowledged by Elizabeth M. McCarthy, its Vice President and Chief Financial Officer and The Bank of New York, the party of the second part, has caused this Indenture to be signed and acknowledged by Paul J. Schmalzel, one of its Vice Presidents, all as of the day and year first written above. DPL INC. By: /s/Elizabeth M. McCarthy ------------------------------------ Name: Elizabeth McCarthy Title: Vice President and Chief Financial Officer THE BANK OF NEW YORK, as Trustee By: /s/Paul J. Schmalzel ------------------------------------ Name: Paul J. Schmalzel Title: Vice President 77 STATE OF OHIO ) : ss.: COUNTY OF DAYTON ) On the 31 day of August, 2001, before me personally came Elizabeth M. McCarthy, to me known, who, being by me duly sworn, did depose and say that she is a Vice President and Chief Financial Officer of DPL Inc., a corporation described in and which executed the foregoing instrument; and that she signed her name thereto by authority of the Board of Directors of such corporation. /s/Timothy G. Rice ---------------------------------- Notary Public 78 STATE OF NEW YORK ) : ss.: COUNTY OF NEW YORK ) On the 31 day of August, 2001, before me personally came Paul J. Schmalzel, to me known, who, being by me duly sworn, did depose and say that he is a Vice President of The Bank of New York, a corporation described in and which executed the foregoing instrument; and that he signed his name thereto by authority of the Board of Directors of such corporation. /s/William J. Cassels ---------------------------------- Notary Public 79 EX-4 4 e431335.txt EXHIBIT 4(B) EXHIBIT 4(b) ================================================================== FIRST SUPPLEMENTAL INDENTURE BETWEEN DPL INC. AND THE BANK OF NEW YORK, AS TRUSTEE DATED AS OF AUGUST 31, 2001 8 1/8% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES DUE SEPTEMBER 1, 2031 ================================================================= TABLE OF CONTENTS Page ---- ARTICLE I DEFINITIONS Section 1.01 Definition of Terms..........................................2 ARTICLE II GENERAL TERMS AND CONDITIONS OF THE JUNIOR SUBORDINATED DEBENTURES Section 2.01 Designation and Principal Amount.............................5 Section 2.02 Stated Maturity..............................................6 Section 2.03 Form and Payment.............................................6 Section 2.04 Exchange and Registration of Transfer of Junior Subordinated Debentures; Restrictions on Transfers; Depositary...................................................6 Section 2.05 Interest.....................................................9 ARTICLE III REDEMPTION of THE JUNIOR SUBORDINATED DEBENTURES Section 3.01 Tax Event or Investment Company Event Redemption............10 Section 3.02 Optional Redemption by Company..............................11 Section 3.03 Notice of Redemption........................................11 ARTICLE IV EXTENSION OF INTEREST PAYMENT PERIOD Section 4.01 Extension of Interest Payment Period........................11 Section 4.02 Notice of Extension.........................................12 ARTICLE V EXPENSES Section 5.01 Payment of Expenses.........................................12 Section 5.02 Payment upon Resignation or Removal.........................13 ARTICLE VI FORM OF JUNIOR SUBORDINATED DEBENTURE Section 6.01 Form of Junior Subordinated Debenture.......................13 ARTICLE VII ORIGINAL ISSUE OF JUNIOR SUBORDINATED DEBENTURES Section 7.01 Original Issue of Junior Subordinated Debentures............13 ARTICLE VIII EXCHANGE OF SECURITIES Section 8.01 Mandatory Tender in Exchange Offer..........................14 ARTICLE IX MISCELLANEOUS Section 9.01 Ratification of Indenture; First Supplemental Indenture Controls..........................................14 Section 9.02 Trustee Not Responsible for Recitals........................14 Section 9.03 Governing Law...............................................14 Section 9.04 Separability................................................15 Section 9.05 Counterparts................................................15 ii FIRST SUPPLEMENTAL INDENTURE, dated as of August 31, 2001 (the "First Supplemental Indenture"), between DPL Inc., an Ohio corporation (the "Company"), and The Bank of New York, as trustee (the "Trustee") under the Indenture dated as of August 31, 2001 between the Company and the Trustee (the "Base Indenture" and, together with this First Supplemental Indenture, the "Indenture"). WHEREAS, the Company executed and delivered the Base Indenture to the Trustee to provide for the future issuance of the Company's unsecured junior subordinated debentures (the "Debentures") to be issued from time to time in one or more series as might be determined by the Company under the Indenture, in an unlimited aggregate principal amount that may be authenticated and delivered as provided in the Base Indenture; WHEREAS, pursuant to the terms of the Base Indenture, the Company desires to provide for the establishment of two separate series of its Debentures, both to be known as its 8 1/8% Junior Subordinated Deferrable Interest Debentures due September 1, 2031 (collectively, the "Junior Subordinated Debentures"), the form and substance of such Junior Subordinated Debentures and the terms, provisions and conditions thereof to be set forth as provided in the Base Indenture and this First Supplemental Indenture; WHEREAS, the Company desires that (x) the first series of Junior Subordinated Debentures (the "Private Debentures") be originally issued on August 31, 2001 pursuant to the Indenture, the Purchase Agreement (as defined below) and the Trust Agreement (as defined in Section 1.01), and (y) the second series of Junior Subordinated Debentures (the "Exchange Debentures") be issuable upon surrender of and in exchange for the Private Debentures pursuant to Section 8.01; WHEREAS, DPL Capital Trust II, a Delaware statutory business trust (the "Trust"), has offered to Morgan Stanley & Co. Incorporated (the "Purchaser") pursuant to the Purchase Agreement (the "Purchase Agreement") dated August 24, 2001 among the Purchaser, the Trust and the Company in a private placement $300,000,000 aggregate liquidation amount of its 8 1/8% Capital Securities (Liquidation Amount $1,000 per Capital Security) (the "Capital Securities"), representing undivided beneficial interests in the assets of the Trust, which Capital Securities are guaranteed to the extent set forth in the Guarantee Agreement, and proposes to invest the proceeds from the sale of the Capital Securities, together with the proceeds of the sale by the Trust to the Company of $9,300,000 aggregate liquidation amount of its Common Securities, in $309,300,000 aggregate principal amount of the Junior Subordinated Debentures; and WHEREAS, the Company has requested that the Trustee execute and deliver this First Supplemental Indenture and all requirements necessary to make this First Supplemental Indenture a valid instrument in accordance with its terms, and to make the Junior Subordinated Debentures, when executed by the Company and authenticated and delivered by the Trustee, the valid obligations of the Company, have been performed, and the execution and delivery of this First Supplemental Indenture has been duly authorized in all respects. NOW, THEREFORE, in consideration of the purchase and acceptance of the Junior Subordinated Debentures by the Trust, and for the purpose of setting forth, as provided in the Base Indenture, the form and substance of the Junior Subordinated Debentures and the terms, provisions and conditions thereof, the Company covenants and agrees with the Trustee as follows: ARTICLE I DEFINITIONS ----------- Section 1.01 Definition of Terms. For all purposes of this First Supplemental Indenture, except as otherwise expressly provided or unless the context otherwise requires: (a) the terms which are defined in the Base Indenture have the same meanings when used in this First Supplemental Indenture; (b) the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular; (c) all other terms used herein which are defined in the Trust Indenture Act of 1939, whether directly or by reference therein, have the meanings assigned to them therein; (d) all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles in the United States of America, and, except as otherwise herein expressly provided, the term "generally accepted accounting principles" with respect to any computation required or permitted hereunder shall mean such accounting principles as are generally accepted in the United States of America at the date of such computation; provided, that when two or more principles are so generally accepted, it shall mean that set of principles consistent with those in use by the Company; (e) a reference to a Section or Article is to a Section or Article of this First Supplemental Indenture unless otherwise stated; (f) the words "herein," "hereof" and "hereunder" and other words of similar import refer to this First Supplemental Indenture as a whole and not to any particular Article, Section or other subdivision; (g) headings are for convenience of reference only and do not affect interpretation; and (h) the following terms have the meanings given to them in the Trust Agreement: (i) Additional Distributions, (ii) Administrative Trustee, (iii) Affiliate, (iv) Capital Securities Certificate, (v) Clearstream, (vi) Delaware Trustee, (vii) Distribution Compliance Period, (viii) Distributions, (ix) Euroclear, (x) Exchange Act, (xi) Exchange and Registration Rights Agreement, (xii) Exchange Offer, (xiii) Guarantee Agreement, (xiv) Institutional Accredited Investor, (xv) Minimum Transfer Legend, (xvi) 144A Global Security, (xvii) Portal Market, (xviii) Private Placement Legend, (xix) Property Trustee, (xx) QIB, (xxi) Regulation S, (xxii) Regulation S Global Security, (xxiii) Rule 144, (xxiv) Rule 144A, (xxv) Rule 144(k), (xxvi) Securities Act, (xxvii) Transfer Restriction Termination Date, and (xxviii) Trust Security. 2 "Additional Interest" has the meaning specified in Section 2.05. "Capital Securities" has the meaning specified in the fourth recital to this First Supplemental Indenture. "Comparable Treasury Issue" means, with respect to any redemption date, the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the time period from the redemption date to September 1, 2031 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 such time period. If no United States Treasury security has a maturity which is within a period from three months before to three months after September 1, 2031, the two most closely corresponding United States Treasury securities shall be used as the Comparable Treasury Issue, and the Treasury Rate shall be interpolated or extrapolated on a straight-line basis, rounding to the nearest month using such securities. "Comparable Treasury Price" means, with respect to any redemption date, (A) the average of up to five Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (B) if the Trustee obtains fewer than five such Reference Treasury Dealer Quotations, the average of all such Quotations. "Coupon Rate" has the meaning specified in Section 2.05(a). "Debentures" has the meaning specified in the first recital to this First Supplemental Indenture. "Definitive Debenture Certificates" means Debentures issued in definitive, fully registered form. "Depositary" has the meaning specified in the Base Indenture. "Exchange Debentures" has the meaning specified in the third recital to this First Supplemental Indenture. "Extension Period" has the meaning specified in Section 4.01. "Global Debenture" has the meaning specified in Section 2.04(a). "Global Private Debenture" has the meaning specified in Section 2.04(d). "Interest Payment Date" has the meaning specified in Section 2.05. "Junior Subordinated Debentures" has the meaning specified in the second recital to this First Supplemental Indenture and, unless the context otherwise requires, shall include any Exchange Debentures to be issued and exchanged for any Private Debentures. "Liquidation Amount" means the stated amount of $1,000 per Capital Security. 3 "Optional Redemption Make-Whole Amount" means an amount equal to the greater of (i) 100% of the principal amount of the Junior Subordinated Debentures being redeemed or (ii) as determined by a Quotation Agent as of the redemption date, the sum of the present value of the scheduled payments of principal and interest on such Junior Subordinated Debentures from the redemption date to September 1, 2031 discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at a discount rate equal to the Treasury Rate plus 25 basis points. "Optional Redemption Price" has the meaning specified in Section 3.2. "Quotation Agent" means Morgan Stanley & Co. Incorporated and its successors as selected by the Company; provided, however, that if any of the foregoing ceases to be a primary United States Government securities dealer in New York City (a "Primary Treasury Dealer"), the Company shall substitute therefor another Primary Treasury Dealer. "144A Global Debenture" has the meaning specified in Section 2.04(c). "Private Debentures" has the meaning specified in the third recital to this First Supplemental Indenture. "Purchase Agreement" has the meaning specified in the fourth recital to this First Supplemental Indenture. "Purchaser" has the meaning specified in the fourth recital to this First Supplemental Indenture. "Record Date" has the meaning specified in Section 2.05(a). "Reference Treasury Dealer" means (i) Morgan Stanley & Co. Incorporated and its successors; provided, however, that if any of the foregoing ceases to be a Primary Treasury Dealer, the Company shall substitute therefor another Primary Treasury Dealer; and (ii) up to four other Primary Treasury Dealers selected by the Trustee after consultation with the Company. "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 5:00 p.m., New York City time, on the third Business Day preceding such prepayment date. "Regulation S Global Debenture" has the meaning specified in Section 2.04(d). "Special Event Redemption Make-Whole Amount" means an amount equal to the greater of (i) 100% of the principal amount of the Junior Subordinated Debentures being redeemed or (ii) as determined by a Quotation Agent as of the redemption date, the sum of the present value of scheduled payments of principal and interest on such Junior Subordinated Debentures from the redemption date to September 1, 2031, discounted to the redemption date 4 on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at a discount rate equal to the Treasury Rate plus 50 basis points. "Special Event Redemption Price" has the meaning specified in Section 3.1. "Special Interest" has the meaning specified in Section 2.05(c). "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 Federal Reserve and which establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption "Treasury Constant Maturities," for the maturity corresponding to the time period from the redemption date to September 1, 2031 (if no maturity is within three months before or after such time period, yields for the two published maturities most closely corresponding to such time period shall be determined and the Treasury Rate shall 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 semi-annual 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. The Treasury Rate shall be calculated on the third Business Day preceding the redemption date. "Trust" has the meaning specified in the fourth recital to this First Supplemental Indenture. "Trust Agreement" means the Amended and Restated Trust Agreement dated as of August 31, 2001 among the Company, as Depositor, The Bank of New York, as Property Trustee, The Bank of New York (Delaware), as Delaware Trustee, the Administrative Trustees named therein and the holders, from time to time, of undivided beneficial interests in the assets of the Trust. ARTICLE II GENERAL TERMS AND CONDITIONS OF THE JUNIOR SUBORDINATED ------------------------------------------------------- DEBENTURES ---------- Section 2.01 Designation and Principal Amount. There is hereby authorized two series of Debentures, both to be designated the "8 1/8% Junior Subordinated Deferrable Interest Debentures due September 1, 2031," and each in the initial aggregate principal amount of $309,300,000, which amount shall be as set forth in any written orders of the Company for the authentication and delivery of Junior Subordinated Debentures pursuant to Section 2.01 of the Base Indenture and Section 7.01(a). Additional Junior Subordinated Debentures without limitation as to amount, and without the consent of the holders of the then Outstanding Junior Subordinated Debentures, may also be authenticated and delivered in the manner provided in Section 2.01 of the Base Indenture. Any such additional Junior Subordinated Debentures may be 5 authenticated and delivered before or after the Exchange Offer and will have the same Stated Maturity and other terms as those initially issued. Section 2.02 Stated Maturity. The Stated Maturity of the Junior Subordinated Debentures is September 1, 2031, and shall not be subject to shortening or extension. Section 2.03 Form and Payment. The Junior Subordinated Debentures shall initially be issued to the Trust in the form of one or more Definitive Debenture Certificates without coupons in minimum denominations of $1,000 and integral multiples of $1,000 in excess thereof and shall contain the Private Placement Legend. Principal and interest on the Junior Subordinated Debentures issued in definitive form will be payable, the transfer of such Junior Subordinated Debentures will be registrable and such Junior Subordinated Debentures will be exchangeable for Junior Subordinated Debentures bearing identical terms and provisions at the principal corporate trust office of the Trustee; provided, however, that payment of interest may be made at the option of the Company by check mailed to the registered holder at such address as shall appear in the Register. Notwithstanding the foregoing, so long as the registered holder of any Junior Subordinated Debentures is the Property Trustee, the payment of the principal of and interest (including Additional Interest, Special Interest and Additional Tax Sums, if any) on such Junior Subordinated Debentures held by the Property Trustee will be made at such place and to such account as may be designated by the Property Trustee. The Register for the Junior Subordinated Debentures shall be kept at the principal corporate trust office of the Trustee. The Trustee is hereby appointed registrar for the Junior Subordinated Debentures. Section 2.04 Exchange and Registration of Transfer of Junior Subordinated Debentures; Restrictions on Transfers; Depositary. If distributed to holders of Capital Securities pursuant to Section 9.4 of the Trust Agreement, the Junior Subordinated Debentures will be issued to such holders in the same form as the Capital Securities that such Junior Subordinated Debentures replace in accordance with the following procedures: (a) So long as Junior Subordinated Debentures are eligible for book- entry settlement with the Depositary, or unless required by law, all Junior Subordinated Debentures that are so eligible will be represented by one or more Junior Subordinated Debentures in global form (a "Global Debenture") registered in the name of the Depositary or the nominee of the Depositary. Except as provided in Section 2.04(i) below, beneficial owners of a Global Debenture shall not be entitled to have Definitive Debenture Certificates registered in their names, will not receive or be entitled to receive physical delivery of Definitive Debenture Certificates and will not be registered holders of such Global Debentures; provided, however, that a Definitive Debenture Certificate shall be issued upon any transfer of a beneficial interest in a Global Private Debenture to the Company or an Affiliate of the Company and no Definitive Debenture Certificate, or portion thereof, in respect of which the Company or an Affiliate of the Company held any beneficial interest shall be resold, retransferred or included in any Private Global Security until such Private Debenture is freely tradeable in accordance with Rule 144(k) or exchanged for an Exchange Debenture. (b) The transfer and exchange of beneficial interests in Global Debentures shall be effected through the Depositary in accordance with the Indenture and the procedures and 6 standing instructions of the Depositary and the Trustee shall make appropriate endorsements to reflect increases or decreases in principal amounts of such Global Debentures. (c) Private Debentures that are distributed in replacement of Private Capital Securities represented by a 144A Global Security will be represented by a global Private Debenture (a "144A Global Debenture"). Transfers of beneficial interests in a 144A Global Debenture will be subject to the restrictions on transfer contained in the Private Placement Legend. (d) Private Debentures that are distributed in replacement of Private Capital Securities represented by a Regulation S Global Security will be represented by a global Private Debenture (a "Regulation S Global Debenture", and together with the 144A Global Debenture, the "Global Private Debenture"). Prior to the expiration of the Distribution Compliance Period, beneficial interests in a Regulation S Global Debenture may only be held by the Depositary's participants in the name of a nominee of Euroclear or Clearstream. After the expiration of the Distribution Compliance Period, transfers of beneficial interests in a Regulation S Global Debenture will not be subject to any restrictions and beneficial interests in the Regulation S Global Debenture may be held by the Depositary's participants other than in the name of a nominee of Euroclear and Clearstream. (e) Private Debentures that are distributed in replacement of Definitive Capital Securities Certificates will be represented by Definitive Debenture Certificates and transfers will be subject to the Private Placement Legend and the requirements of Section 2.04(g)(1) or (g)(2). (f) Exchange Debentures that are distributed in replacement of Exchange Capital Securities will be represented by a Global Debenture or in such other form as the Trustee may direct. (g) Unless and until the earlier of (i) the date upon which Private Debentures are exchanged for Exchange Debentures in connection with an effective registration statement pursuant to the Exchange and Registration Rights Agreement or (ii) the Transfer Restriction Termination Date: (1) Definitive to Definitive Transfers. Any transfer of a Definitive Debenture Certificate shall be registered upon the Register only upon receipt by the Trustee of such Definitive Debenture Certificate accompanied by a duly completed and executed assignment in the form of Exhibit A-1 and, in the case of a transfer to an Institutional Accredited Investor, upon the receipt by the Trustee of a written certificate in the form of Exhibit B (or other certifications, legal opinions or other information as the Company may reasonably request to confirm that such transfer is exempt from the registration requirements of the Securities Act); (2) Definitive into a 144A Global Debenture. So long as Private Debentures are eligible for book-entry settlement with the Depositary or unless otherwise required by law, upon any transfer of a Definitive Debenture Certificate to a QIB in accordance with Rule 144A or to a non-U.S. Person in accordance with Regulation S, and upon receipt of the Definitive Debenture Certificate being so transferred, accompanied by 7 a duly completed and executed assignment in the form attached hereto as Exhibit A-1, the Trustee shall make an endorsement on any 144A Global Debenture or any Regulation S Global Debenture, as the case may be, to reflect an increase in such Global Debenture and the Trustee shall cancel such Definitive Debenture Certificate; (3) 144A Global Debenture into Regulation S Global Debenture. Any transfer in accordance with Rule 904 of Regulation S of a beneficial interest in a 144A Global Debenture to a transferee that takes delivery in the form of a beneficial interest in a Regulation S Global Debenture shall be reflected by an increase in a Regulation S Global Debenture and a corresponding decrease in the 144A Global Debenture, in each case by the Trustee making an endorsement on such Global Private Debenture, only upon receipt by the Trustee of a written certificate in the form of Exhibit C (or such other certifications, legal opinions or other information as the Company may reasonably request to confirm that such transfer is being made pursuant to such Rule 904); and (4) Regulation S Global Debenture into 144A Global Debenture. Any transfer of a beneficial interest in a Regulation S Global Debenture to a transferee that takes delivery in the form of a beneficial interest in a 144A Global Debenture shall be reflected by an increase in the 144A Global Debenture and a corresponding decrease in the Regulation S Global Debenture in each case by the Trustee making an endorsement on such Global Private Debenture, and, prior to the expiration of the Distribution Compliance Period, only upon receipt by the Trustee of a written certificate in the form of Exhibit D (or such other certifications, legal opinions or other information as the Company may reasonably require). (h) Any Global Debenture may be endorsed with or have incorporated in the text thereof such legends or recitals or changes not inconsistent with the provisions of the Indenture as may be required by the Depositary, by any national securities exchange or by the National Association of Securities Dealers, Inc. in order for the Private Debentures to be tradeable on the Portal Market or as may be required for the Private Debentures to be tradeable on any other market developed for trading of securities pursuant to Rule 144A or required to comply with any applicable law or any regulation thereunder or with the rules and regulations of any securities exchange upon which the Junior Subordinated Debentures may be listed or traded or to conform with any usage with respect thereto, or to indicate any special limitations or restrictions to which any particular Junior Subordinated Debentures are subject. (i) Notwithstanding any other provisions of the Indenture (other than the provisions set forth in this Section 2.04(i)), a Global Debenture may not be exchanged in whole or in part for Definitive Debenture Certificates, and no transfer of a Global Debenture may be registered, in the name of any person other than the Depositary or a nominee thereof unless (i) such Depositary (A) has notified the Company that it is unwilling or unable to continue as Depositary for such Global Debenture or (B) has ceased to be a clearing agency registered as such under the Exchange Act and no successor Depositary has been appointed by the Company within 90 days after its receipt of such notice or its becoming aware of such ineligibility, (ii) there shall have occurred and be continuing an Event of Default, or any event which after notice or lapse of time or both would be an Event of Default under the Indenture, with respect to such Debenture, or (iii) the Company, in its sole discretion, instructs the Trustee to exchange such 8 Global Debenture for a Definitive Debenture Certificates (in which case such exchange shall be effected by the Trustee). The Depositary shall be a clearing agency registered under the Exchange Act. The Company initially appoints The Depository Trust Company to act as Depositary with respect to the Global Debentures. Initially, any Global Debentures shall be registered in the name of Cede & Co., as the nominee of the Depositary, and deposited with the Depository or the Trustee as custodian for Cede & Co. Definitive Debenture Certificates issued in exchange for all or a part of a Global Debenture pursuant to this Section 2.04(i) shall be registered in such names and in such authorized denominations as the Depositary, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee. Upon execution and authentication, the Trustee shall deliver such Definitive Debenture Certificates to the person in whose names such Definitive Debenture Certificates are so registered. So long as Junior Subordinated Debentures are represented by one or more Global Debentures, (i) the registrar for the Junior Subordinated Debentures and the Trustee shall be entitled to deal with the Depositary for all purposes of the Indenture relating to such Global Debentures as the sole holder of the Junior Subordinated Debentures evidenced by such Global Debentures and shall have no obligations to the holders of beneficial interests in such Global Debentures; and (ii) the rights of the holders of beneficial interests in such Global Debentures shall be exercised only through the Depositary and shall be limited to those established by law and agreements between such holders and the Depositary and/or the participants in the Depositary. At such time as all interests in a Global Debenture have been redeemed, exchanged, repurchased or canceled, such Global Debenture shall be, upon receipt thereof, canceled by the Trustee in accordance with standing procedures and instructions of the Depositary. At any time prior to such cancellation, if any interest in a Global Debenture is exchanged for Definitive Debenture Certificates, redeemed by the Company pursuant to Article 3 or canceled, or transferred for part of a Global Debenture, the principal amount of such Global Debenture shall, in accordance with the standing procedures and instructions of the Depositary be reduced or increased, as the case may be, and an endorsement shall be made on such Global Debenture by, or at the direction of, the Trustee to reflect such reduction or increase. Any beneficial interest in one of the Global Debentures that is transferred to an owner who takes delivery in the form of an interest in the other Global Debentures will, upon transfer, cease to be an interest in the former Global Debenture and will become an interest in the latter Global Debentures and, accordingly, will thereafter be subject to all transfer restrictions and other procedures applicable to beneficial interests in such latter Global Debenture for so long as it remains such an interest. Section 2.05 Interest. (a) Each Junior Subordinated Debenture will bear interest at the rate of 8 1/8% per annum (the "Coupon Rate") from the Closing Date (as defined in the Purchase Agreement) until the principal thereof becomes due and payable, and will bear interest on any overdue principal at the Coupon Rate and (to the extent that payment of such interest is 9 enforceable under applicable law) on any overdue installment of interest at the Coupon Rate ("Additional Interest"), compounded semiannually, payable (subject to the provisions of Article 4) semiannually in arrears on the 1st day of March and September of each year (each, an "Interest Payment Date"), commencing on March 1, 2002, to the Person in whose name such Junior Subordinated Debenture is registered, subject to certain exceptions, at the close of business on the Record Date next preceding such Interest Payment Date. The "Record Date" for payment of interest will be the Business Day next preceding the Interest Payment Date, unless such Junior Subordinated Debenture is registered to a holder other than the Property Trustee or a nominee of the Depositary, in which case the Record Date for payment of interest will be the fifteenth day of the calendar month next preceding the month in which the applicable Interest Payment Date occurs or, if such fifteenth day of the month is not a Business Day, then the Business Day next preceding such day. Until liquidation, if any, of the Trust, each Junior Subordinated Debenture will be held in the name of the Property Trustee in trust for the benefit of the holders of the Trust Securities. (b) The amount of interest payable for any period will be computed on the basis of a 360-day year of twelve 30-day months (and for any partial periods on the basis of the number of days elapsed in a 360-day year of twelve 30-day months). In the event that any date on which interest is payable on the Junior Subordinated Debentures is not a Business Day, then payment of interest payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), in each case with the same force and effect as if made on the date such payment was originally payable. (c) If the Company does not comply with certain of its obligations under the Exchange and Registration Rights Agreement, the Private Debentures shall, in accordance with Section 2(e) of the Exchange and Registration Rights Agreement, bear additional interest ("Special Interest") in addition to the interest provided for in Section 2.05(a). (d) The Company will pay any Additional Tax Sums on the Junior Subordinated Debentures pursuant to Section 4.08 of the Base Indenture. ARTICLE III REDEMPTION of THE JUNIOR SUBORDINATED DEBENTURES ------------------------------------------------ Section 3.01 Tax Event or Investment Company Event Redemption. If a Tax Event or Investment Company Event (either, a "Special Event") shall occur and be continuing, the Company may redeem the Junior Subordinated Debentures at any time within 90 days after the occurrence of that Special Event, in whole but not in part, at a redemption price (the "Special Event Redemption Price") equal to the Special Event Make-Whole Amount plus accrued and unpaid interest thereon to but excluding the redemption date. The Special Event Redemption Price shall be paid prior to 2:00 p.m., New York City time, on the date of such redemption, provided that the Company shall deposit with the Trustee an amount sufficient to pay the Special Event Redemption Price by 11:00 a.m., New York City time, on the date such Special Event Redemption Price is to be paid. 10 Section 3.02 Optional Redemption by Company. The Company shall have the option to redeem the Junior Subordinated Debentures at any time, in whole or in part, at a redemption price (the "Optional Redemption Price") equal to the Optional Redemption Make-Whole Amount plus accrued and unpaid interest thereon to but excluding the redemption date. The Optional Redemption Price shall be paid prior to 2:00 p.m., New York City time, on the date of such redemption, provided that the Company shall deposit with the Trustee an amount sufficient to pay the Option Redemption Price by 11:00 a.m., New York City time, on the date such Optional Redemption Price is to be paid. Section 3.03 Notice of Redemption. Subject to Article Three of the Base Indenture, notice of any redemption pursuant to this Article Three will be mailed at least 30 days but not more than 60 days before the redemption date to each holder of Junior Subordinated Debentures to be redeemed at such holder's registered address. Unless the Company defaults in payment of the applicable redemption price, on and after the redemption date interest shall cease to accrue on such Junior Subordinated Debentures called for redemption. The Company will notify the Trustee of the amount of the redemption price promptly after the calculation thereof and the Trustee will not be responsible for such calculation. ARTICLE IV EXTENSION OF INTEREST PAYMENT PERIOD ------------------------------------ Section 4.01 Extension of Interest Payment Period. So long no Event of Default under Section 6.01 of the Base Indenture has occurred and is continuing, the Company shall have the right, subject to the provisions of Section 2.10 of the Base Indenture, at any time during the term of the Junior Subordinated Debentures, from time to time to defer the payment of interest by extending the interest payment period of such Junior Subordinated Debentures for a period not exceeding 10 consecutive semi-annual periods (an "Extension Period"), during which Extension Period the Company shall have the right to make partial payments of interest on any Interest Payment Date. No Extension Period shall end on a date other than an Interest Payment Date or extend beyond the Stated Maturity or any earlier redemption date. To the extent permitted by applicable law, interest, the payment of which has been deferred because of an Extension Period imposed pursuant to this Section 4.01, will bear Additional Interest compounded semi-annually. At the end of the Extension Period, the Company shall pay all interest then accrued and unpaid on the Junior Subordinated Debentures, including any Additional Interest, Special Interest and Additional Tax Sums, if applicable, to the holders of the Junior Subordinated Debentures in whose names the Junior Subordinated Debentures are registered in the Register on the first Record Date preceding the end of the Extension Period. Before the termination of any Extension Period, the Company may further extend such Extension Period, provided that such period together with all such further extensions thereof shall not exceed 10 consecutive semi- annual periods, or extend beyond the Stated Maturity or any earlier redemption date. At any time following the termination of any Extension Period and upon the payment of any accrued and unpaid Additional Interest and Special Interest then due, the Company may elect to begin a new Extension Period, subject to the foregoing requirements. No interest shall be due and payable during an Extension Period, except at the end thereof. 11 Section 4.02 Notice of Extension. (a) If the Property Trustee is the only registered holder of the Junior Subordinated Debentures at the time the Company elects to begin or extend an Extension Period, the Company shall give written notice to the Property Trustee and the Trustee of its election to begin or extend any Extension Period at least five Business Days prior to the earlier of (i) the next succeeding date on which Distributions on the Capital Securities issued by the Trust would have been payable but for the election to begin or extend such Extension Period or (ii) the date the Administrative Trustees are required to give notice to any securities exchange or other applicable self- regulatory organization or to holders of such Capital Securities of the record date or the date such Distributions are payable, but in any event not less than five Business Days prior to such record date. An Administrative Trustee shall give notice of the Company's election to begin or extend an Extension Period to the holders of such Capital Securities. (b) If the Property Trustee is not the only holder of the Junior Subordinated Debentures at the time the Company elects to begin or extend an Extension Period, the Company shall give the holders of the Junior Subordinated Debentures and the Trustee written notice of its election to begin or extend such Extension Period at least ten Business Days prior to the earlier of (i) the next succeeding Interest Payment Date or (ii) the date the Company is required to give notice of the record or payment date of such interest payment to any applicable self-regulatory organization or to holders of the Junior Subordinated Debentures. (c) The semi-annual period in which any notice is given pursuant to paragraphs (a) or (b) of this Section 4.02 shall be counted as one of the 10 consecutive semi-annual periods permitted in the maximum Extension Period permitted under Section 4.01. ARTICLE V EXPENSES -------- Section 5.01 Payment of Expenses. In connection with the offering, sale and issuance of the Junior Subordinated Debentures to the Property Trustee and in connection with the offering, sale and issuance of the Trust Securities by the Trust, the Company, in its capacity as borrower with respect to the Junior Subordinated Debentures, shall: (a) pay all costs and expenses relating to the offering, sale and issuance of the Junior Subordinated Debentures, including commissions to the Purchaser payable pursuant to the Purchase Agreement and compensation of the Trustee under the Indenture in accordance with the provisions of Section 7.06 of the Base Indenture; (b) pay all costs and expenses of the Trust (including, but not limited to, costs and expenses relating to the organization of the Trust, the fees and expenses of the Property Trustee and the Delaware Trustee, the costs and expenses relating to the operation of the Trust, including without limitation, costs and expenses of accountants, attorneys, statistical or bookkeeping services, expenses for printing and engraving and computing or accounting equipment, paying agent(s), registrar(s), transfer agent(s), duplicating, travel and telephone and other telecommunications expenses and costs and expenses incurred in connection with the acquisition, financing, and disposition of Trust assets); 12 (c) pay all costs and expenses related to the enforcement by the Property Trustee of the rights of the registered holders of the Capital Securities; (d) be primarily liable for any indemnification obligations arising with respect to the Trust Agreement; and (e) pay any and all taxes and all liabilities, costs and expenses with respect to such taxes of the Trust (but not including withholding taxes imposed on holders of Capital Securities or Common Securities of the Trust). Section 5.02 Payment upon Resignation or Removal. Upon termination of this First Supplemental Indenture or the Base Indenture or the removal or resignation of the Trustee pursuant to Section 7.10 of the Base Indenture, the Company shall pay to the Trustee all amounts owed to it under Section 7.06 of the Base Indenture accrued to the date of such termination, removal or resignation. Upon termination of the Trust Agreement or the removal or resignation of the Delaware Trustee or the Property Trustee, as the case may be, pursuant to Section 8.10 of the Trust Agreement, the Company shall pay to the Delaware Trustee or the Property Trustee, and their respective counsel, as the case may be, all amounts owed to them under Section 8.7 of the Trust Agreement accrued to the date of such termination, removal or resignation. ARTICLE VI FORM OF JUNIOR SUBORDINATED DEBENTURE ------------------------------------- Section 6.01 Form of Junior Subordinated Debenture. The Junior Subordinated Debentures and the Trustee's Certificate of Authentication to be endorsed thereon are to be substantially in the form attached hereto as Exhibit A. ARTICLE VII ORIGINAL ISSUE OF JUNIOR SUBORDINATED DEBENTURES ------------------------------------------------ Section 7.01 Original Issue of Junior Subordinated Debentures. (a) Junior Subordinated Debentures in the initial aggregate principal amount of $309,300,000 may be executed by the Company and delivered to the Trustee for authentication by it, and the Trustee shall thereupon authenticate and deliver said Junior Subordinated Debentures to or upon the written order of the Company, signed by its Chairman of the Board, any Vice Chairman of the Board, the Chief Executive Officer, the President, any Vice Chairman or any Vice President (whether or not designated by a number or word or words added before or after the title Vice President) and by its Treasurer, an Assistant Treasurer, the Controller, its Secretary or an Assistant Secretary, without any further corporate action by the Company as follows: (i) $309,300,000 initial aggregate principal amount of Private Debentures to be originally issued on the Closing Date (as defined in the Purchase Agreement) and (ii) subject to the issuance of additional Junior Subordinated Debentures as described in the next sentence, $309,300,000 aggregate principal amount of Exchange Debentures to be issued upon surrender of and in exchange for the Private Debentures pursuant to Section 8.01. Additional Junior Subordinated Debentures without limitation as to amount, and without the consent of the holders of the then 13 Outstanding Junior Subordinated Debentures, may also be authenticated and delivered in the manner provided in Section 2.01 of the Base Indenture. Any such additional Junior Subordinated Debentures may be authenticated and delivered before or after the Exchange Offer and will have the same Stated Maturity and other terms as those initially issued. (b) Each Exchange Debenture shall be issued only upon surrender of and in exchange for a like aggregate principal amount of Private Debentures and any Private Debentures surrendered in exchange for Exchange Debentures shall be canceled. ARTICLE VIII EXCHANGE OF SECURITIES ---------------------- Section 8.01 Mandatory Tender in Exchange Offer. The Junior Subordinated Debentures will not be convertible into any other securities or property of the Company. The Junior Subordinated Debentures may not be exchanged for Securities of any other series, except that if the Company effects an exchange offer pursuant to Section 2(a) of the Exchange and Registration Rights Agreement and, if pursuant to such exchange offer, the Company offers to exchange any Private Debentures for Exchange Debentures, and the Property Trustee is the only registered holder of the Junior Subordinated Debentures at such time, then, to the extent permitted by law, each holder of the Private Debentures shall be obligated to tender all the Private Debentures held by such holder in exchange for a like principal amount of the Exchange Debentures in accordance with the Company's instructions. ARTICLE IX MISCELLANEOUS ------------- Section 9.01 Ratification of Indenture; First Supplemental Indenture Controls. The Indenture, as supplemented by this First Supplemental Indenture, is in all respects ratified and confirmed, and this First Supplemental Indenture shall be deemed part of the Indenture in the manner and to the extent herein and therein provided. The provisions of this First Supplemental Indenture shall supersede the provisions of the Indenture to the extent the Indenture is inconsistent herewith. Section 9.02 Trustee Not Responsible for Recitals. The recitals herein contained are made by the Company and not by the Trustee, and the Trustee assumes no responsibility for the correctness thereof. The Trustee makes no representation as to the validity or sufficiency of this First Supplemental Indenture. Section 9.03 Governing Law. This First Supplemental Indenture and each Junior Subordinated Debenture shall be deemed to be a contract made under the internal laws of the State of New York, and for all purposes shall be governed by and construed in accordance with the laws of said State (including without limitation Section 5-1401 of the New York General Obligations Law or any successor to such statute). 14 Section 9.04 Separability. In case any one or more of the provisions contained in this First Supplemental Indenture or in the Junior Subordinated Debentures shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this First Supplemental Indenture or of the Junior Subordinated Debentures, but this First Supplemental Indenture and the Junior Subordinated Debentures shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein or therein. Section 9.05 Counterparts. This First Supplemental Indenture may be executed in any number of counterparts each of which shall be an original; but such counterparts shall together constitute but one and the same instrument. 15 IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental Indenture to be duly executed as of the date first above written. DPL INC. By: /s/Elizabeth M. McCarthy ------------------------------------ Name: Elizabeth M. McCarthy Title: Vice President and Chief Financial Officer The Bank of New York, as Trustee By: /s/Paul J. Schmalzel ------------------------------------ Name: Paul J. Schmalzel Title: Vice President 16 EXHIBIT A (FORM OF JUNIOR SUBORDINATED DEBENTURE) THE DEBENTURES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, EACH HOLDER OF THE DEBENTURES EVIDENCED HEREBY, AND EACH PERSON THAT ACQUIRES A BENEFICIAL INTEREST IN SUCH DEBENTURES, (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501 (a)(1),(2),(3) OR (7) UNDER THE SECURITIES ACT) ("INSTITUTIONAL ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THE DEBENTURES EVIDENCED HEREBY IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL NOT, PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE DEBENTURES EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION), OFFER, RESELL OR OTHERWISE TRANSFER THE DEBENTURES EVIDENCED HEREBY EXCEPT (A) TO DPL INC. OR A SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (D) INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE BANK OF NEW YORK, AS TRUSTEE, A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THE DEBENTURES EVIDENCED HEREBY (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM SUCH TRUSTEE), (E) OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT OR (F) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) AND (G) IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION, AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE DEBENTURES EVIDENCED HEREBY ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED INVESTOR OR A PURCHASER WHO IS NOT A U.S. PERSON, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE BANK OF NEW YORK, AS TRUSTEE, SUCH CERTIFICATIONS OR OTHER INFORMATION AS DPL INC. MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED AFTER THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE DEBENTURES EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT OR SUCH EARLIER TIME AS A TRANSFER OF THE DEBENTURES EVIDENCED HEREBY IS MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT. Registered NUMBER R-1 $________________ DPL INC. 8 1/8% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURE DUE SEPTEMBER 1, 2031 Dated: __________________ [CUSIP__________________] Registered Holder: DPL INC., a corporation duly organized and existing under the laws of the State of Ohio (herein referred to as the "Company," which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to the Registered Holder named above, the principal sum of ($ ) on September 1, 2031, in such coin or currency of the United States of America as at the time of payment is legal tender for the payment of public and private debt. The Company further promises to pay to the registered Holder hereof as hereinafter provided (a) interest on said principal sum (subject to deferral as set forth herein) at the rate per annum specified in the title of this debenture (the "Debenture"), in like coin or currency, semiannually in arrears on the 1st day of March and September of each year (each, an "Interest Payment Date") commencing March 1, 2002, from the Interest Payment Date next preceding the date hereof to which interest has been paid or duly provided for (unless (i) no interest has yet been paid or duly provided for on this Debenture, in which case from August 31, 2001, or (ii) the date hereof is before an Interest Payment Date but after the related Record Date (as defined below), in which case from such following Interest Payment Date; provided, however, that if the Company shall default in payment of the interest due on such following Interest Payment Date, then from the next preceding Interest Payment Date to which interest has been paid or duly provided for, until the principal hereof is paid or duly provided for, plus (b) Additional Interest, as defined in the Indenture, to the extent permitted by applicable law, on any interest payment that is not made on the applicable Interest Payment Date, which shall accrue at the rate per annum specified in the title of this Debenture, compounded semiannually. The interest so payable will, subject to certain exceptions provided in the Indenture hereinafter referred to, be paid to the person in whose name this Debenture is registered at the close of business on the Record Date next preceding such Interest Payment Date. The Record Date shall be the Business Day next preceding the Interest Payment Date, unless this Certificate is registered to a holder other than the Property Trustee or a nominee of The Depository Trust Company, in which case the Record Date will be the fifteenth day of the calendar month next preceding the month in which the applicable Interest Payment A-2 Date occurs or, if such fifteenth day of the month is not a Business Day, then the Business Day next preceding such day. This Debenture may be presented for payment of principal and interest at the principal corporate trust office of The Bank of New York, as paying agent for the Company, maintained for that purpose in the Borough of Manhattan, The City of New York, State of New York; provided, however, that payment of interest may be made at the option of the Company (i) by check mailed to such address of the person entitled thereto as the address shall appear on the Register of the Debentures or (ii) by transfer to an account maintained by the Person entitled thereto as specified in the Register; provided that proper transfer instructions have been received by the Record Date. Interest on the Debenture will be computed on the basis of a 360-day year of twelve 30-day months (and for any partial periods on the basis of the number of days elapsed in a 360-day year of twelve 30-day months). So long as no Event of Default has occurred and is continuing, the Company shall have the right at any time during the term of this Debenture from time to time to defer payment of interest on this Debenture, for up to ten consecutive semiannual interest payment periods with respect to each deferral period (each an "Extension Period"), during which Extension Periods the Company shall have the right to make partial payments of interest on any Interest Payment Date; provided, however, that no Extension Period shall end on a date other than an Interest Payment Date or extend beyond September 1, 2031 or any earlier redemption date. At the end of each Extension Period, the Company shall pay all interest then accrued and unpaid (together with any Additional Interest thereon to the extent permitted by applicable law, Special Interest, and Additional Tax Sums, if applicable). During any such Extension Period, the Company shall not, and shall cause any Subsidiary of the Company not to, (i) declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of the Company's Capital Stock (which includes Common Stock and preferred stock) or (ii) make any payment of principal of or interest or premium, if any, on or repay, repurchase or redeem any debt securities that rank on a parity with or junior to this Debenture or make any guarantee payments with respect to any DPL Guarantee or other guarantee by the Company that ranks on a parity with or junior to this Debenture (other than (a) dividends or distributions payable in Common Stock, (b) any declaration of a dividend in connection with the implementation of a Rights Plan, the issuance of any Capital Stock or any class or series of preferred stock of the Company under any Rights Plan or the redemption or repurchase of any rights distributed pursuant to a Rights Plan, (c) payments under any DPL Guarantee relating to the Preferred Securities issued by the DPL Trust holding this Debenture, and (d) purchases of Common Stock related to the issuance of Common Stock or rights under any of the Company's benefit plans for its directors, officers, employees, consultants or advisors). Prior to the termination of any such Extension Period, the Company may further extend such Extension Period; provided, however, that no Extension Period shall exceed ten consecutive semiannual periods or extend beyond September 1, 2031 or any earlier redemption date. At any time following the termination of any Extension Period and the payment of all accrued and unpaid interest (together with any Additional Interest, Special Interest and Additional Tax Sums, if applicable) then due, the Company may elect to begin a new Extension Period, subject to the above requirements. No interest shall be due and payable during an Extension Period except at the end thereof. If the Property Trustee is the only registered holder of the Debentures of this series, the Company shall give written notice to the Property Trustee and the Trustee of its election to begin or extend any Extension Period at least five Business Days prior to the earlier of (i) the next succeeding date on which Distributions on the Capital Securities issued by the A-3 relevant DPL Trust would have been payable but for the election to begin or extend such Extension Period or (ii) the date the Administrative Trustees are required to give notice to any securities exchange or other applicable self- regulatory organization or to holders of such Capital Securities of the record date or the date such Distributions are payable, but in any event not less than five Business Days prior to such record date. An Administrative Trustee shall give notice of the Company's election to begin or extend an Extension Period to the holders of such Capital Securities. If the Property Trustee is not the only holder of the Debentures of this series at the time the Company elects to begin or extend an Extension Period, the Company shall give the holders of the Debentures of this series and the Trustee written notice of its election to begin or extend such Extension Period at least ten Business Days prior to the earlier of (i) the next succeeding Interest Payment Date or (ii) the date the Company is required to give notice of the record or payment date of such interest payment to any applicable self-regulatory organization or to holders of the Debentures of this series. This Debenture is issued pursuant to an Indenture, dated as of August 31, 2001, between the Company, as issuer, and The Bank of New York, a New York banking corporation, as trustee, as supplemented by a First Supplemental Indenture dated as of August 31, 2001 (as further supplemented or amended from time to time, the "Indenture"). Reference is made to the Indenture for a description of the respective rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the Holders (the word "Holder" or "Holders" meaning the registered holder or registered holders) of the Debentures. Capitalized terms used herein but not defined herein shall have the respective meanings assigned thereto in the Indenture. By acceptance of this Debenture, the Holder hereof agrees to be bound by the provisions of the Indenture. The Debentures of this series shall have an initial aggregate principal amount of Three Hundred and Nine Million Three Hundred Thousand Dollars ($309,300,000). The indebtedness of the Company evidenced by this Debenture, including the principal hereof and interest hereon, is, to the extent and in the manner set forth in the Indenture, subordinate and junior in right of payment to the Company's obligations to Holders of Senior Indebtedness of the Company and each Holder of this Debenture, by acceptance hereof, agrees to and shall be bound by such provisions of the Indenture and all other provisions of the Indenture. This Debenture shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed by or on behalf of the Trustee under the Indenture. A-4 IN WITNESS WHEREOF, DPL INC. has caused this instrument to be signed, manually or in facsimile, by its Chairman of the Board, or its Chief Executive Officer, or its President or any Vice Chairman, or any Vice President and by its Treasurer or an Assistant Treasurer or its Controller or its Secretary or an Assistant Secretary. DPL INC. By:____________________________ Name: Title: By:____________________________ Name: Title: [Seal] TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Securities, of the series designated herein, described in the within-mentioned Indenture. Dated: THE BANK OF NEW YORK, as Trustee By:____________________________ Authorized Signatory A-5 REVERSE OF DEBENTURE As provided in and subject to the provisions of the Indenture, if an Event of Default with respect to the payment of principal or interest on the Debentures of this series or with respect to compliance with certain covenants occurs and is continuing, then either the Trustee or the Holders of not less than 25% in principal amount of the then outstanding Debentures of each series as to which such Event of Default has occurred may declare the principal amount of all the Debentures of such series, together with any accrued interest (including any Additional Interest, Special Interest and Additional Tax Sums), to be due and payable immediately, by a notice in writing to the Company (and to the Trustee, if such notice is given by Holders). If the Debentures have been issued to an DPL Trust, upon such an Event of Default, if the Trustee or the Holders of not less than 25% in principal amount of the outstanding Debentures of this series fails to declare the principal of all the Debentures to be immediately due and payable, the holders of at least 25% in aggregate liquidation amount of the corresponding Capital Securities of such DPL Trust then outstanding shall have such right by a notice in writing to the Company and the Trustee, and upon any such declaration the principal amount of and the accrued interest (including any Additional Interest, Special Interest and Additional Tax Sums) on all the Debentures of such series shall become immediately due and payable; provided that the payment of principal and interest on the Debentures shall remain subordinated to the extent provided in the Indenture. If an Event of Default with respect to certain covenants applicable to all series of securities issued under the Indenture (collectively, the "Securities") occurs and is continuing, then either the Trustee or the Holders of not less than 25% in principal amount of all then outstanding Securities under the Indenture (voting as a single class) may declare the principal amount of all such Securities to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if such notice is given by Holders). If the Securities of a series issued under the Indenture have been issued to an DPL Trust, upon such an Event of Default, if the Trustee and the Holders of not less than 25% in principal amount of all outstanding Securities of that series fail to declare the principal of all the Securities of that series to be immediately due and payable, the holders of at least 25% in aggregate liquidation amount of the corresponding Capital Securities of such DPL Trust then outstanding shall have such right by a notice in writing to the Company and the Trustee; and upon any such declaration the principal amount of and the accrued interest (including any Additional Interest and Special Interest) on all the Securities of that series shall become immediately due and payable; provided that the payment of principal and interest shall remain subordinated to the extent provided in the Indenture. The Indenture provides that in certain events such declaration that principal and accrued interest are due and payable, and the consequences of such declaration, may be rescinded and annulled by the holders of at least a majority in principal amount of the Securities then outstanding under the Indenture as to which such acceleration of the payment of principal and interest has occurred, voting as one class. In the case of Securities issued under the Indenture to one or more DPL Trusts, should the Holders of such Securities fail to rescind and annul such declaration and its consequences, the Holders of at least a majority in aggregate liquidation amount of the corresponding Capital Securities of such DPL Trusts shall have such right. The Indenture also provides that the Holders of at least a majority in principal amount of all of the A-1-6 Securities of all series then outstanding as to which an Event of Default has occurred may, on behalf of all Holders of such Securities, waive any past default under the Indenture other than (a) a default in the payment of the principal of or interest on any of the Securities or (b) a default in respect of a covenant or provision of the Indenture which under the terms of the Indenture cannot be modified or amended without the consent of each Holder of Securities so affected. In the case of Securities of one or more series issued to one or more DPL Trusts, the Indenture provides that the Holders of at least a majority in aggregate liquidation amount of the corresponding Capital Securities issued by such DPL Trusts shall also have the right to waive such defaults. The Indenture contains provisions permitting the Company and the Trustee, with the consent of the Holders of not less than a majority in principal amount of the outstanding Securities of all affected series (voting as one class), to execute supplemental indentures adding any provisions to or changing or eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying the rights of the holders of the Securities of each such series; provided, however, that no such supplemental indenture shall (i) change the fixed maturity of any Securities, or reduce the rate or extend the time of payment of interest thereon or on any overdue principal amount, or reduce the principal amount thereof, or reduce any amount payable upon any redemption thereof, or make the principal thereof or any interest thereon or on any overdue principal amount payable in any coin or currency other than that herein prescribed, without the consent of the Holder of each security so affected, (ii) reduce the percentage of Securities, the consent of the Holders of which is required for any such supplemental indenture, without the consent of all Holders of Securities then outstanding, (iii) modify certain provisions of the Indenture relating to waiver of compliance with covenants, waiver of defaults or modification of the Indenture without the consent of all Holders of Securities then outstanding, except to increase the percentage of Holders required for such waiver or modification, or (iv) modify the provisions with respect to the subordination of outstanding Securities of any series in a manner adverse to the Holders thereof, without the consent of the Holder of each security so affected; provided, however, that, in the case of the Securities of a series issued to an DPL Trust, so long as any of the corresponding series of Capital Securities issued by such DPL Trust remains outstanding, (i) no such amendment shall be made that adversely affects the holders of such Capital Securities or Preferred Securities in any material respect, and no termination of the Indenture shall occur, and no waiver of any Event of Default with respect to such series or compliance with any covenant with respect to such series under the Indenture shall be effective, without the prior consent of the holders of at least a majority of the aggregate liquidation amount of such Capital Securities then outstanding, unless and until the principal (and premium, if any) of the Securities of such series and all accrued and unpaid interest (including any Additional Interest) thereon shall have been paid in full and (ii) no amendment shall be made to Section 6.05 of the Base Indenture (regarding the right of Holders of Capital Securities to institute a suit directly against the Company) that would impair the rights of the Holders of Capital Securities provided therein without the prior consent of all Holders of Capital Securities then outstanding, unless and until the principal (and premium, if any) of the Securities of such series and all accrued and unpaid interest (including any Additional Interest) thereon have been paid in full. As provided in and subject to the provisions in the Indenture, the Company shall have the option to redeem the Debentures of this series at any time, in whole but not in part, at the Optional Redemption Price. In addition, if a Special Event shall occur and be continuing, the Company may redeem the Debentures of this series at any time within 90 days after the A-1-7 occurrence of that Special Event, in whole but not in part, at the Special Event Redemption Price. Any consent or waiver by the Holder of this Debenture given as provided in the Indenture (unless effectively revoked as provided in the Indenture) shall be conclusive and binding upon such Holder and upon all future Holders of this Debenture and of any Debenture issued in exchange, registration of transfer, or otherwise in lieu hereof irrespective of whether any notation of such consent or waiver is made upon this Debenture or such other Debentures. No reference herein to the Indenture and no provision of this Debenture or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and interest on this Debenture, at the places, at the respective times, at the rate and in the coin or currency herein prescribed. If the Company does not comply with certain of its obligations under the Exchange and Registration Rights Agreement, this Debenture shall bear additional interest ("Special Interest") in addition to the interest provided for in Section 2.05(a) of the First Supplemental Indenture to the Indenture. As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Debenture may be registered on the Register of the Debentures of this series upon surrender of this Debenture for registration of transfer at the offices maintained by the Company or its agent for such purpose, duly endorsed by the Holder hereof or his attorney duly authorized in writing, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Securities registrar duly executed by the Holder hereof or his attorney duly authorized in writing, but without payment of any charge other than a sum sufficient to reimburse the Company for any tax or other governmental charge incident thereto. Upon any such registration of transfer, a new Debenture or Debentures of authorized denomination or denominations for the same aggregate principal amount will be issued to the transferee in exchange herefor. Prior to due presentment for registration of transfer of this Debenture, the Company, the Trustee, and any agent of the Company or the Trustee may deem and treat the person in whose name this Debenture shall be registered upon the Register of the Debentures of this series as the absolute owner of this Debenture (whether or not this Debenture shall be overdue and notwithstanding any notation of ownership or other writing hereon) for the purpose of receiving payment of or on account of the principal hereof and, subject to the provisions on the face hereof, interest due hereon and for all other purposes; and neither the Company nor the Trustee nor any such agent shall be affected by any notice to the contrary. No recourse shall be had for the payment of the principal of or interest on this Debenture, or for any claim based hereon or otherwise in respect hereof, or based on or in respect of the Indenture or any indenture supplemental thereto, against any stockholder, officer, director or employee, as such, past, present or future, of the Company or of any successor corporation, either directly or through the Company, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as a part of the consideration for the issue hereof, expressly waived and released. A-1-8 The Company and, by acceptance of this Debenture or a beneficial interest in this Debenture, each holder hereof and any person acquiring a beneficial interest herein, agree that for United States federal, state and local tax purposes it is intended that this Debenture constitute indebtedness. This Debenture shall be deemed to be a contract made under the laws of the State of New York (without regard to conflicts of laws principles thereof) and for all purposes shall be governed by, and construed in accordance with, the laws of said State (including without limitation Section 5-1401 of the New York General Obligations Law or any successor to such statute). EXHIBIT A-1 FORM OF CERTIFICATE OF TRANSFER FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto Please insert Social Security or other taxpayer identification number of transferee: ________________________________ ________________________________________________________________________________ (Name and Address of Transferee, including Zip Code, must be printed or typewritten) ________________________________________________________________________________ the within Junior Subordinated Deferrable Interest Debenture (the "Debenture") and hereby irrevocably constitutes and appoints ___________________ attorney to transfer said Debenture on the Register of the Debentures, with full power of substitution in the premises. In connection with any transfer of the within Debenture occurring prior to such date as restrictions on the transfer of such security imposed by the Securities Act of 1933, as amended (the "Securities Act"), and the rules and regulations thereunder shall be terminated in accordance with the Indenture, the undersigned confirms that such Debenture is being transferred: [___] To DPL Inc. or a subsidiary thereof; or [___] Pursuant to an effective registration statement under the Securities Act; or [___] Pursuant to and in compliance with Rule 144A under the Securities Act; or [___] Pursuant to and in compliance with Regulation S under the Securities Act; or [___] To an Institutional Accredited Investor pursuant to and in compliance with the Securities Act; or [___] Pursuant to and in compliance with Rule 144 under the Securities Act: and unless the box below is checked, the undersigned confirms that such Debenture is not being transferred to an "affiliate" of DPL Inc., as defined in Rule 144 under the Securities Act (an "Affiliate"): [___] The transferee is an Affiliate of DPL Inc. Date: __________________________ ________________________________ ________________________________ Signature(s) Signature(s) must be guaranteed. A-1-1 NOTICE: The signature to this assignment must correspond with the name as it appears upon the face of the within Junior Subordinated Deferrable Interest Debenture in every particular, without alteration or enlargement or any change whatever. A-1-2 [IF JUNIOR SUBORDINATED DEBENTURE IS AN EXCHANGE DEBENTURE, INSERT - FORM OF ASSIGNMENT For Value Received, the undersigned assigns and transfers this Junior Subordinated Debenture to:_____________________________________________________ (Insert assignee's social security or tax identification number) _________________________________________ (Insert address and zip code of assignee) and irrevocably appoints _____________________________ agent to transfer this Junior Subordinated Debenture Certificate on the books of the Trust. The agent may substitute another to act for him or her. Date: Signature(s): ___________________________________________________________ ___________________________________________________________ (Sign exactly as your name appears on the other side of this Junior Subordinated Debenture Certificate) NOTICE: THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17AD-15. A-1-3 EXHIBIT B FORM OF LETTER TO BE DELIVERED BY INSTITUTIONAL ACCREDITED INVESTORS The Bank of New York, as Trustee 101 Barclay Street, Floor 21 West New York, New York 10286 Attention: Corporate Trust Administration Dear Sirs and Mesdames: We understand that the 8 1/8% Junior Subordinated Deferrable Interest Debentures due September 1, 2031 (the "Debentures") of DPL Inc. ("DPL") are being offered in a transaction not involving any public offering within the United States within the meaning of the Securities Act of 1933, as amended (the "Securities Act"), and that the Debentures have not been registered under the Securities Act, and we agree, on our own behalf and on behalf of each account for which we acquire any Debentures, that if, prior to the expiration of the holding period applicable to sales of any Debenture under Rule 144(k) under the Securities Act, we decide to offer, resell or otherwise transfer such Debenture, such Debenture may be offered, resold or otherwise transferred only (i) to DPL or a subsidiary thereof, (ii) pursuant to an effective registration statement under the Securities Act, (iii) inside the United States to a person who is a "qualified institutional buyer" (as defined in Rule 144A under the Securities Act) in compliance with Rule 144A under the Securities Act, (iv) inside the United States to an Institutional Accredited Investor (as defined below) that, prior to such transfer, furnishes to The Bank of New York, as trustee ( the "Trustee"), a signed letter in the form hereof and such other opinions and certifications that such trustee or DPL may request, (v) outside the United States in compliance with Rule 904 under the Securities Act or (vi) pursuant to the exemption from registration provided by Rule 144 under the Securities Act (if available) and (vii) in each case, in accordance with any applicable securities laws of the States of the United States or any other applicable jurisdiction and in accordance with the legend set forth on the Debentures. We further agree to provide any person purchasing any of the Debentures from us a notice advising such purchaser that resales of such securities are restricted as stated herein. We understand that any Debentures will bear a legend reflecting the substance of this paragraph. We confirm that: (i) we are an "accredited investor" within the meaning of Rule 501(a)(1), (2) or (3) under the Securities Act or an entity in which all of the equity owners are accredited investors within the meaning of Rule 501(a)(1), (2) and (3) under the Securities Act (an "Institutional Accredited Investor"); (ii) (A) any acquisition of Debentures by us will be for our own account or for the account of one or more other Institutional Accredited Investors or as fiduciary for the account of one or more trusts, each of which is an "accredited investor" within the meaning of Rule 501(a)(7) under the Securities Act and for each of which we exercise sole investment discretion or (B) we are a "bank," within the meaning of Section 3(a)(2) of the Securities Act, or a "savings and loan association" or other institution described in Section 3(a)(5)(A) of the Securities Act that is acquiring Debentures as fiduciary for the account of one or more institutions for which we exercise sole investment discretion; (iii) we have such knowledge and experience in financial and business matters that we are capable of evaluating the merits and risks of an investment in the Debentures; (iv) we are not acquiring Debentures with a view to resale or distribution thereof or with any present intention of offering or selling Debentures, except as permitted above; provided that the disposition of our property and property of any accounts for which we are acting as fiduciary shall remain at all times within our control; and (v) we have had access to such financial and other information and have been afforded the opportunity to ask such questions of representatives of DPL and receive answers thereto, as we deem necessary in connection with our decision to acquire Debentures. We acknowledge that DPL, you and others will rely upon our confirmations, acknowledgments and agreements set forth herein, and we agree to notify you promptly in writing if any of our representations or warranties herein ceases to be accurate and complete. THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK. (Name of Transferee) By:________________________________ Name: Title: Address: B-2 EXHIBIT C FORM OF TRANSFER CERTIFICATE 144A GLOBAL DEBENTURE TO REGULATION S GLOBAL DEBENTURE The Bank of New York 101 Barclay Street, 21 West New York, New York 10280 Attention: Corporate Trust Administration Re: DPL Inc. (the "Company") 8 1/8% Junior Subordinated Deferrable Interest Debentures due September 1, 2031 (the "Debentures") Reference is hereby made to the Indenture (the "Base Indenture") dated as of August 31, 2001 between the Company and The Bank of New York, as Trustee (as supplemented by the First Supplemental Indenture (the "Supplemental Indenture") dated as of August 31, 2001, the "Indenture"). Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. This letter relates to _________________ Private Debentures which are evidenced by a 144A Global Debenture (CUSIP No. [ ]) and held with the Depositary indirectly in the name of [insert name of transferor] (the "Transferor"). The Transferor has requested a transfer of such beneficial interest in the Private Debentures to a Person that will take delivery thereof in a transaction effected pursuant to and in accordance with Rule 904 under the United States Securities Act of 1933, as amended (the "Securities Act"), and accordingly the Transferor does hereby further certify that: The offer of the Private Debentures was not made to a person in the United States; (A) either: (i) at the time the buy order was originated, the transferee was outside the United States or the Transferor and any person acting on its behalf reasonably believed that the transferee was outside the United States, or (ii) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither the Transferor nor any person acting on its behalf knows that the transaction was pre-arranged with a buyer in the United States; (B) no directed selling efforts have been made in contravention of the requirements of Rule 904(b) under the Securities Act, as applicable; (C) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act; and (D) we have advised the transferee of the transfer restrictions applicable to the Private Debentures. You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby. Terms used in this certificate and not otherwise defined herein or in the Indenture have the meanings set forth in Regulation S under the Securities Act. Dated: [Insert Name of Transferor] By:_________________________________ Name: Title: (If the registered owner is a corporation, partnership or fiduciary, the title of the Person signing on behalf of such registered owner must be stated.) C-2 EXHIBIT D FORM OF TRANSFER CERTIFICATE REGULATION S GLOBAL DEBENTURE TO 144A GLOBAL DEBENTURE The Bank of New York 101 Barclay Street, 21 West New York, New York 10280 Attention: Corporate Trust Administration Re: DPL Inc. (the "Company") 8 1/8% Junior Subordinated Deferrable Interest Debentures due September 1, 2031 (the "Debentures") Reference is hereby made to the Indenture (the "Base Indenture") dated as of August 31, 2001 between the Company and The Bank of New York, as Trustee (as supplemented by the First Supplemental Indenture (the "Supplemental Indenture") dated as of August 31, 2001, the "Indenture"). Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. This letter relates to _________________ Private Debentures which are evidenced by a Regulation S Global Debenture (CUSIP No. [ ]) and held with the Depositary indirectly in the name of [insert name of transferor] (the "Transferor"). The Transferor has requested a transfer of such beneficial interest in the Private Debentures to a Person that will take delivery thereof in a transaction effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the "Securities Act"), and accordingly the Transferor does hereby certify that the (i) the Transferor's interest in the Private Debentures is being transferred in accordance with the transfer restrictions set forth in the Indenture and in the Private Debenture; and (ii) the transferee is a person who the Transferor reasonably believes is a "qualified institutional buyer" within the meaning of Rule 144A under the Securities Act, purchasing for its own account or the account of a qualified institutional buyer in a transaction meeting the requirements of Rule 144A, in accordance with all applicable securities laws of the states of the United States and other jurisdictions. You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby. Dated: [Insert Name of Transferor] By:_________________________________ Name: Title: (If the registered owner is a corporation, partnership or fiduciary, the title of the Person signing on behalf of such registered owner must be stated.) EX-4 5 e431334.txt EXHIBIT 4(C) EXHIBIT 4(C) ================================================================================ AMENDED AND RESTATED TRUST AGREEMENT among DPL INC., as Depositor, THE BANK OF NEW YORK, as Property Trustee, THE BANK OF NEW YORK (DELAWARE), as Delaware Trustee, THE ADMINISTRATIVE TRUSTEES NAMED HEREIN and THE SEVERAL HOLDERS, AS HEREIN DEFINED Dated as of August 31, 2001 DPL CAPITAL TRUST II ================================================================================ DPL CAPITAL TRUST II Certain Sections of the Trust Agreement relating to Sections 310 through 318 of the Trust Indenture Act of 1939: Trust Indenture Trust Agreement Act Section Section (S) 310(a)(1)................................................................8.1 (a)(2)..............................................................8.1 (a)(3)..............................................................8.9 (a)(4).......................................................2.7(a)(ii) (b) .............................................................8.8 (S) 311(a) ............................................................8.13 (b) ............................................................8.13 (S) 312(a) .............................................................5.7 (b) .............................................................5.7 (c) .............................................................5.7 (S) 313(a) .........................................................8.14(a) (a)(4)..........................................................8.14(a) (b) .........................................................8.14(b) (c) ............................................................10.8 (d) .........................................................8.14(c) (S) 314(a) ............................................................8.15 (b) ..................................................Not Applicable (c)(1).............................................................8.16 (c)(2).............................................................8.16 (c)(3)...................................................Not Applicable (d) ..................................................Not Applicable (e) .......................................................1.1, 8.16 (S) 315(a) ..................................................8.2(a), 8.4(a) (b) .......................................................8.3, 10.8 (c) ..........................................................8.2(a) (d) ........................................................8.2, 8.4 (e) ..................................................Not Applicable (S) 316(a) ............................................................5.14 (a)(1)(A).......................................................5.14(c) (a)(1)(B).......................................................5.14(b) (a)(2)...................................................Not Applicable (b) ............................................................5.14 (c) .............................................................6.7 (S) 317(a)(1).....................................................Not Applicable (a)(2)...................................................Not Applicable (b) .............................................................5.9 (S) 318(a) ...........................................................10.10 - ------------------- Note: This reconciliation and tie sheet shall not, for any purpose, be deemed to be a part of the Trust Agreement. i TABLE OF CONTENTS Page ---- ARTICLE I DEFINED TERMS Section 1.1. Definitions......................................................1 ARTICLE II CONTINUATION OF THE TRUST Section 2.1. Name............................................................11 Section 2.2. Office of the Delaware Trustee; Principal Place of Business.....................................................11 Section 2.3. Initial Contribution of Trust Property; Organizational Expenses........................................................12 Section 2.4. Issuance of the Capital Securities..............................12 Section 2.5. Issuance of the Common Securities; Subscription and Purchase of Debentures..........................................12 Section 2.6. Declaration of Trust............................................13 Section 2.7. Authorization to Enter into Certain Transactions................13 Section 2.8. Assets of Trust.................................................17 Section 2.9. Title to Trust Property.........................................17 ARTICLE III PAYMENT ACCOUNT Section 3.1. Payment Account.................................................17 i ARTICLE IV DISTRIBUTIONS; REDEMPTION Section 4.1. Distributions...................................................17 Section 4.2. Redemption......................................................18 Section 4.3. Subordination of Common Securities..............................20 Section 4.4. Payment Procedures..............................................20 Section 4.5. Tax Returns and Reports.........................................21 Section 4.6. Payment of Taxes, Duties, Etc. of the Trust.....................21 Section 4.7. Reduction for Payments under Indenture or Pursuant to Direct Actions..................................................21 ARTICLE V TRUST SECURITIES CERTIFICATES Section 5.1. Initial Ownership...............................................21 Section 5.2. The Trust Securities Certificates; Execution and Delivery Thereof................................................21 Section 5.3. Form of Trust Securities Certificates...........................22 Section 5.4. Registration of Transfer and Exchange of Capital Securities Certificates.........................................23 Section 5.5. Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates....................................................24 Section 5.6. Persons Deemed Securityholders..................................24 Section 5.7. Access to List of Securityholders' Names and Addresses..........24 Section 5.8. Maintenance of Office or Agency for Transfers...................24 Section 5.9. Appointment of Paying Agent.....................................25 Section 5.10. Ownership of Common Securities by Depositor.....................25 Section 5.11. Book-Entry Interests............................................25 Section 5.12. Notices to Clearing Agency......................................28 Section 5.13. Procedures for Issuance of Definitive Capital Securities Certificates....................................................28 Section 5.14. Rights of Securityholders.......................................29 ARTICLE VI ACTS OF SECURITYHOLDERS; MEETINGS; VOTING Section 6.1. Limitations on Voting Rights....................................31 Section 6.2. Notice of Meetings..............................................32 Section 6.3. Meetings of Capital Securityholders.............................32 Section 6.4. Voting Rights...................................................32 Section 6.5. Proxies, etc....................................................33 Section 6.6. Securityholder Action by Written Consent........................33 Section 6.7. Record Date for Voting and Other Purposes.......................33 Section 6.8. Acts of Securityholders.........................................33 Section 6.9. Inspection of Records...........................................34 ARTICLE VII REPRESENTATIONS AND WARRANTIES Section 7.1. Representations and Warranties of the Bank, the Property Trustee and the Delaware Trustee................................34 Section 7.2. Representations and Warranties of Depositor.....................36 ARTICLE VIII THE TRUSTEES Section 8.1. Corporate Property Trustee Required; Eligibility of Trustees....36 Section 8.2. Certain Duties and Responsibilities.............................36 ii Section 8.3. Certain Notices.................................................39 Section 8.4. Certain Rights of Property Trustee..............................39 Section 8.5. Not Responsible for Recitals or Issuance of Trust Securities....42 Section 8.6. May Hold Securities.............................................42 Section 8.7. Compensation; Indemnity; Fees...................................42 Section 8.8. Conflicting Interests...........................................44 Section 8.9. Co-Trustees and Separate Trustee................................44 Section 8.10. Resignation and Removal; Appointment of Successor...............45 Section 8.11. Acceptance of Appointment by Successor..........................47 Section 8.12. Merger, Conversion, Consolidation or Succession to Business.....47 Section 8.13. Preferential Collection of Claims Against Depositor or Trust....47 Section 8.14. Reports by Property Trustee.....................................48 Section 8.15. Reports to the Property Trustee.................................48 Section 8.16. Evidence of Compliance with Conditions Precedent................49 Section 8.17. Number of Trustees..............................................49 Section 8.18. Delegation of Power.............................................49 Section 8.19. Fiduciary Duty..................................................50 ARTICLE IX TERMINATION, LIQUIDATION AND MERGER Section 9.1. Termination Upon Expiration Date................................50 Section 9.2. Early Termination...............................................51 Section 9.3. Termination.....................................................51 Section 9.4. Liquidation.....................................................51 Section 9.5. Mergers, Consolidations, Amalgamations or Replacements of the Trust.......................................................53 ARTICLE X MISCELLANEOUS PROVISIONS Section 10.1. Limitation of Rights of Securityholders to Terminate Trust...........................................................54 Section 10.2. Amendment.......................................................54 Section 10.3. Separability....................................................55 Section 10.4. Governing Law...................................................55 Section 10.5. Payments Due on Non-Business Day................................56 Section 10.6. Successors......................................................56 Section 10.7. Headings........................................................56 Section 10.8. Reports, Notices and Demands....................................56 Section 10.9. Agreement Not to Petition.......................................57 Section 10.10.Trust Indenture Act; Conflict with Trust Indenture Act..........57 Section 10.11.Acceptance of Terms of Trust Agreement, Guarantee and Indenture.......................................................57 Section 10.12.Counterparts....................................................58 iii EXHIBIT A Certificate of Trust..........................................A-1 EXHIBIT B Form of 144A Global Security..................................B-1 EXHIBIT C Form of Regulation S Global Security..........................C-1 EXHIBIT D Form of Definitive Capital Security Certificate...............D-1 EXHIBIT E Form of Common Security Certificate...........................E-1 EXHIBIT F Form of Letter to be Delivered by Institutional Accredited Investors..........................................F-1 EXHIBIT G Form of Transfer Certificate - 144A Global Security to Regulation S Global Security...............................G-1 EXHIBIT H Form of Transfer Certificate - Regulation S Global Security to 144A Global Security..............................H-1 EXHIBIT I Form of Private Placement Legend..............................I-1 iv AMENDED AND RESTATED TRUST AGREEMENT, dated as of August 31, 2001, among (i) DPL INC., an Ohio corporation (including any successors or assigns, the "DEPOSITOR"), (ii) The Bank of New York, a New York banking corporation, as property trustee (in such capacity, the "PROPERTY TRUSTEE" and, in its separate corporate capacity and not in its capacity as Property Trustee, the "BANK"), (iii) The Bank of New York (Delaware), a banking corporation that maintains its principal place of business in Delaware, as Delaware trustee (the "DELAWARE TRUSTEE"), (iv) Allen M. Hill, an individual, and Stephen F. Koziar, Jr., an individual, each of whose address is c/o DPL Inc., Courthouse Plaza Southwest, Dayton, Ohio 45402 (each, an "ADMINISTRATIVE TRUSTEE" and collectively, the "ADMINISTRATIVE TRUSTEES") and (v) the several Holders, as hereinafter defined. WITNESSETH WHEREAS, the Depositor, the Delaware Trustee and an Administrative Trustee have heretofore duly declared and created a business trust pursuant to the Delaware Business Trust Act by entering into that certain Trust Agreement, dated as of August 23, 2001 (the "Original Trust Agreement"), and by the execution and filing with the Secretary of State of the State of Delaware of a Certificate of Trust, filed on August 23, 2001, substantially in the form attached as Exhibit A; - ---------- WHEREAS, the Depositor and the Trustees desire to amend and restate the Original Trust Agreement in its entirety as set forth herein to provide for, among other things, (i) the issuance of the Common Securities by the Trust to the Depositor, (ii) the issuance and sale of the Capital Securities by the Trust pursuant to the Purchase Agreement, (iii) the acquisition by the Trust from the Depositor of all of the right, title and interest in the Debentures, and (iv) the mandatory exchange by the Property Trustee with the Depositor of the Private Debentures for the Exchange Debentures, and the exchange by the Trust with the Securityholders of the Private Capital Securities for the Exchange Capital Securities, each such exchange registered under the Securities Act; and WHEREAS, upon the effectiveness of the exchange registration statement referred to in the Exchange and Registration Rights Agreement, this Trust Agreement shall be subject to, and shall be governed by, the provisions of the Trust Indenture Act that are required to be part of and to govern indentures qualified under the Trust Indenture Act; NOW THEREFORE, in consideration of the agreements and obligations set forth herein and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, each party, for the benefit of the other parties and for the benefit of the Securityholders, hereby amends and restates the Original Trust Agreement in its entirety and agrees as follows: ARTICLE I DEFINED TERMS ------------- Section 1.1. Definitions. For all purposes of this Trust Agreement, except ----------- as otherwise expressly provided or unless the context otherwise requires: (a) the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular; (b) all other terms used herein that are defined in the Trust Indenture Act, either directly or by reference therein, have the meanings assigned to them therein; (c) unless the context otherwise requires, any reference to an "Article" or a "Section" refers to an Article or a Section, as the case may be, of this Trust Agreement; and (d) the words "herein," "hereof" and "hereunder" and other ------ ------ --------- words of similar import refer to this Trust Agreement as a whole and not to any particular Article, Section or other subdivision. "ACT" has the meaning specified in SECTION 6.8. "ADDITIONAL DISTRIBUTIONS" means, with respect to Trust Securities of a given Liquidation Amount and/or a given period, the amount of Additional Interest (as defined in the Indenture) paid by the Depositor on a Like Amount of Debentures for such period. "ADDITIONAL TAX SUMS" has the meaning specified in SECTION 4.08 of the Indenture. "ADMINISTRATIVE TRUSTEE" means a Person satisfying the eligibility requirements set forth in SECTION 8.1(b) and initially means each of Allen M. Hill and Stephen F. Koziar, Jr., solely in such Person's capacity as Administrative Trustee of the Trust heretofore created and continued hereunder and not in such Person's individual capacity, or such Administrative Trustee's successor in interest in such capacity, or any successor trustee appointed as herein provided. "AFFILIATE" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, "control" when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing. "BANK" has the meaning specified in the preamble to this Trust Agreement. "BANKRUPTCY EVENT" means, with respect to any Person: (a) the entry of a decree or order by a court having jurisdiction in the premises judging such Person a bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjudication or composition of or in respect of such Person under any applicable federal or state bankruptcy, insolvency, reorganization or other similar law, or appointing a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of such Person or of any substantial part of its property or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of 60 consecutive days; or 2 (b) the institution by such Person of proceedings to be adjudicated a bankrupt or insolvent, or the consent by it to the institution of bankruptcy or insolvency proceedings against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal or state bankruptcy, insolvency, reorganization or other similar law, or the consent by it to the filing of any such petition or to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of such Person or of any substantial part of its property, or the making by it of an assignment for the benefit of creditors, or the admission by it in writing of its inability to pay its debts generally as they become due and its willingness to be adjudicated a bankrupt, or the taking of corporate action by such Person in furtherance of any such action. "BANKRUPTCY LAWS" has the meaning specified in SECTION 10.9. "BUSINESS DAY" means any day that is not a Saturday or Sunday and that is neither a legal holiday nor a day on which banking institutions in The City of New York are authorized or required by law or executive order to close or a day on which the Corporate Trust Office of the Property Trustee or the Debenture Trustee is closed for business. "CAPITAL SECURITIES CERTIFICATE" means a certificate evidencing ownership of Private Capital Securities, which certificate shall initially be substantially in the form attached as Exhibit B, Exhibit C or Exhibit D, or Exchange Capital Securities. "CAPITAL SECURITY" means an undivided beneficial interest in the assets of the Trust, having a Liquidation Amount of $1,000 and having the rights provided therefor in this Trust Agreement, including the right to receive Distributions and a Liquidation Distribution as provided herein. Unless the context otherwise requires, the term "Capital Securities" shall include (a) any Exchange Capital Securities to be issued and exchanged for any Private Capital Securities and (b) in each case, any Tranche of Capital Securities. "CERTIFICATE DEPOSITORY AGREEMENT" means the agreement among the Trust, the Property Trustee and DTC, as the initial Clearing Agency, dated as of the initial Closing Date, relating to the Capital Securities Certificates, as the same may be amended and supplemented from time to time. "CLEARING AGENCY" means an organization registered as a "clearing agency" pursuant to SECTION 17A of the Exchange Act. DTC will be the initial Clearing Agency. "CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other financial institution or other Person for whom from time to time a Clearing Agency effects book-entry transfers and pledges of securities deposited with the Clearing Agency. "CLEARSTREAM" means Clearstream Banking, societe anonyme. "CLOSING DATE" means the date or dates on which the Capital Securities are issued and sold. "CODE" means the Internal Revenue Code of 1986, as amended. 3 "COMMISSION" means the Securities and Exchange Commission, as from time to time constituted, created under the Exchange Act. "COMMON SECURITY" means an undivided beneficial interest in the assets of the Trust, having a Liquidation Amount of $1,000 and having the rights provided therefor in this Trust Agreement, including the right to receive Distributions and a Liquidation Distribution as provided herein, and shall include any Tranche of Common Securities. "COMMON SECURITIES CERTIFICATE" means a certificate evidencing ownership of Common Securities, substantially in the form attached as Exhibit E. "CORPORATE TRUST OFFICE" means (i) when used with respect to the Property Trustee, the principal corporate trust office of the Property Trustee located in New York, New York, and (ii) when used with respect to the Debenture Trustee, the principal corporate trust office of the Debenture Trustee located in New York, New York, which office at the date hereof in each of cases (i) and (ii) is located at 101 Barclay Street, Floor 21 West, New York, New York 10286, Attention: Corporate Trust Administration. "COVERED PERSON" means (a) any officer, director, shareholder, partner, member, representative, employee or agent of the Trust or the Trust's Affiliates; and (b) any Holder of the Trust Securities. "DEBENTURE EVENT OF DEFAULT" means an "Event of Default" as defined in the Indenture. "DEBENTURE REDEMPTION DATE" means, with respect to any Debentures to be redeemed under the Indenture, the date fixed for redemption under the Indenture. "DEBENTURE TRUSTEE" means The Bank of New York, and any successor thereto under the Indenture. "DEBENTURES" means the Depositor's 8 1/8% Junior Subordinated Deferrable Interest Debentures due September 1, 2031, to be issued from time to time pursuant to the Indenture. Unless the context otherwise requires, the term "Debentures" shall include any Exchange Debentures to be issued and exchanged for any Private Debentures. "DEFINITIVE CAPITAL SECURITIES CERTIFICATES" means Capital Securities Certificates issued in definitive, fully registered form. "DELAWARE BUSINESS TRUST ACT" means Chapter 38 of Title 12 of the Delaware Code, 12 Del. C. ((S)) 3801, et seq., as it may be amended from time to time. "DELAWARE TRUSTEE" means the corporation identified as the "Delaware Trustee" in the preamble to this Trust Agreement solely in its capacity as Delaware Trustee of the Trust heretofore created and continued hereunder and not in its individual capacity, or its successor in interest in such capacity, or any Delaware Trustee appointed as herein provided. "DEPOSITOR" has the meaning specified in the preamble to this Trust Agreement. 4 "DIRECT ACTION" has the meaning specified in SECTION 5.14(c). "DISTRIBUTION COMPLIANCE PERIOD" means the period of 40 consecutive days beginning on and including the later of (x) the day on which the offering of the Capital Securities commences or (y) the initial Closing Date. "DISTRIBUTION DATE" has the meaning specified in SECTION 4.1(a). "DISTRIBUTIONS" means amounts payable in respect of the Trust Securities as provided in SECTION 4.1 and shall include, if applicable, Additional Distributions, Special Distributions and Additional Tax Sums. "DTC" means The Depository Trust Company, New York, New York. "EARLY TERMINATION EVENT" has the meaning specified in SECTION 9.2. "EUROCLEAR" means Morgan Guaranty Trust Company of New York in its capacity as operator of The Euroclear System. "EVENT OF DEFAULT" means any one of the following events (whatever the reason for such Event of Default and whether it is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body): (a) the occurrence of a Debenture Event of Default; or (b) default by the Trust in the payment of any Distribution when it becomes due and payable, and continuation of such default for a period of 30 days; or (c) default by the Trust in the payment of any Redemption Price of any Trust Security when it becomes due and payable; or (d) default in the performance, or breach, in any material respect, of any covenant or warranty of the Trustees in this Trust Agreement (other than a covenant or warranty a default in the performance or breach of which is addressed in clause (b) or (c) above) and continuation of such default or breach for a period of 60 days after there has been given, by registered or certified mail, to the defaulting Trustee or Trustees by the Holders of at least 25% in aggregate Liquidation Amount of the Outstanding Capital Securities a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a "Notice of Default" hereunder; or (e) the occurrence of a Bankruptcy Event with respect to the Property Trustee and the failure to appoint a successor Property Trustee within 60 days thereof. "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended. 5 "EXCHANGE AND REGISTRATION RIGHTS AGREEMENT" means an agreement dated as of August 24, 2001 among the Depositor, the Trust and the Initial Purchaser. "EXCHANGE CAPITAL SECURITIES" means Capital Securities representing undivided beneficial interests in the assets of the Trust, issued by the Trust in an exchange offer for the Private Capital Securities, such exchange offer being registered under the Securities Act, all pursuant to the Exchange and Registration Rights Agreement. "EXCHANGE DEBENTURES" means a new series of junior subordinated debentures issued by the Depositor in a mandatory exchange offer for the Private Debentures, such exchange offer being registered under the Securities Act, all pursuant to the Exchange and Registration Rights Agreement. "EXCHANGE GUARANTEE" means the Exchange Guarantee extended by the Depositor for the benefit of the Holders of Capital Securities pursuant to the Exchange Guarantee Agreement, and registered under the Securities Act pursuant to the Exchange and Registration Rights Agreement. "EXCHANGE GUARANTEE AGREEMENT" means the Guarantee Agreement to be entered into by the Depositor, as Guarantor, and The Bank of New York, as Guarantee Trustee, pursuant to the Exchange and Registration Rights Agreement. "EXCHANGE OFFER" means an exchange offer of the Exchange Capital Securities for the Private Capital Securities, which is to be registered under the Securities Act pursuant to the Exchange and Registration Rights Agreement. "EXPENSE AGREEMENT" means the Agreement as to Expenses and Liabilities between the Depositor and the Trust, as amended from time to time. "EXPIRATION DATE" has the meaning specified in SECTION 9.1. "GLOBAL CAPITAL SECURITIES CERTIFICATE" or "GLOBAL CAPITAL SECURITY" means any Capital Securities Certificate in the form of a 144A Global Security, a Regulation S Global Security and, if applicable, any Exchange Capital Security represented in global form and deposited with the Clearing Agency or the Property Trustee as custodian for the Clearing Agency. "GUARANTEE" means the Private Guarantee with respect to the Private Capital Securities and the Exchange Guarantee with respect to the Exchange Capital Securities. "GUARANTEE AGREEMENT" means the Capital Securities Guarantee Agreement dated as of August 31, 2001 between the Depositor, as Guarantor, and The Bank of New York, as Guarantee Trustee. "HOLDER" means a Person in whose name a Trust Security or Trust Securities is registered in the Securities Register; any such Person shall be a beneficial owner within the meaning of the Delaware Business Trust Act. "INDEMNIFIED PERSON" has the meaning specified in SECTION 8.7(c). 6 "INDENTURE" means the Indenture, dated as of August 31, 2001, between the Depositor and the Debenture Trustee, as trustee, as supplemented by the First Supplemental Indenture dated as of August 31, 2001, and as may be further amended or supplemented from time to time. "INITIAL PURCHASER" means Morgan Stanley & Co. Incorporated. "INSTITUTIONAL ACCREDITED INVESTOR" means an institutional investor that is an "accredited investor" within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act. "LIEN" means any lien, pledge, charge, encumbrance, mortgage, deed of trust, adverse ownership interest, hypothecation, assignment, security interest or preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever. "LIKE AMOUNT" means (a) with respect to a redemption of Trust Securities, Trust Securities having a Liquidation Amount equal to the principal amount of Debentures to be contemporaneously repaid or redeemed in accordance with the Indenture the proceeds of which will be used to pay the Redemption Price of such Trust Securities, and (b) with respect to a distribution of Debentures to Holders of Trust Securities in connection with a dissolution, termination or liquidation of the Trust, Debentures having a principal amount equal to the Liquidation Amount of the Trust Securities of the Holder to whom such Debentures are distributed. "LIQUIDATION AMOUNT" means the stated amount of $1,000 per Trust Security. "LIQUIDATION DATE" means the date on which Debentures are to be distributed to Holders of Trust Securities in connection with a dissolution, termination and liquidation of the Trust pursuant to SECTION 9.4(a). "LIQUIDATION DISTRIBUTION" has the meaning specified in SECTION 9.4(d). "1940 ACT" means the Investment Company Act of 1940, as amended. "OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of the Board, any Vice Chairman of the Board, the Chief Executive Officer, the President, any Vice Chairman or any Vice President of the Depositor (whether or not designated by a number or a word or words added before or after the title Vice President) and by the Treasurer, an Assistant Treasurer, the Controller, the Secretary or an Assistant Secretary of the Depositor and delivered to the appropriate Trustee. Any Officers' Certificate delivered with respect to compliance with a condition or covenant provided for in this Trust Agreement shall include: (a) a statement that each officer signing the Officers' Certificate has read the covenant or condition and the definitions relating thereto; (b) a brief statement of the nature and scope of the examination or investigation undertaken by each officer in rendering the Officers' Certificate; 7 (c) a statement that each such officer has made such examination or investigation as, in such officer's opinion, is necessary to enable such officer to express an informed opinion as to whether or not such covenant or condition has been complied with; and (d) a statement as to whether, in the opinion of each such officer, such condition or covenant has been complied with. "144A GLOBAL SECURITY" has the meaning specified in SECTION 5.3(b). "OPINION OF COUNSEL" means a written opinion of counsel, who may be counsel for the Trust, the Property Trustee or the Depositor (including counsel who is an employee of the Depositor), who is experienced in matters related to the substance of the opinion; provided however, that for purposes of SECTIONS 6.1(b), 9.2(d), 9.5 and 10.2(b), such opinion shall be by nationally recognized independent legal counsel experienced in the matters related to the substance of the opinion. "ORIGINAL TRUST AGREEMENT" has the meaning specified in the recitals to this Trust Agreement. "OUTSTANDING", when used with respect to Trust Securities, means, as of the date of determination, all Trust Securities theretofore executed and delivered under this Trust Agreement, except: (a) Trust Securities theretofore cancelled by the Securities Registrar or delivered to the Securities Registrar for cancellation; (b) Trust Securities for whose payment or redemption money in the necessary amount has been theretofore deposited with the Property Trustee or any Paying Agent for the Holders of such Trust Securities; provided, however, that, if such Trust Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Trust Agreement; and (c) Trust Securities which have been paid or in exchange for or in lieu of which other Trust Securities have been executed and delivered pursuant to SECTIONS 5.4, 5.5, 5.11 and 5.13; provided, however, that in determining whether the Holders of the requisite Liquidation Amount of the Outstanding Capital Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, Capital Securities owned by the Depositor, any Trustee or any Affiliate of the Depositor or any Trustee shall be disregarded and deemed not to be Outstanding, except that (a) in determining whether any Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Capital Securities that such Trustee actually knows to be so owned shall be so disregarded and (b) the foregoing shall not apply at any time when all of the outstanding Capital Securities are owned by the Depositor, one or more of the Trustees and/or any such Affiliate. Capital Securities so owned that have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Administrative Trustee the pledgee's right so to act with respect to such Capital Securities and that the pledgee is not the Depositor or any Affiliate of the Depositor. 8 "OWNER" means each Person who is the beneficial owner of a Global Capital Securities Certificate as reflected in the records of the Clearing Agency or, if a Clearing Agency Participant is not the Owner, then as reflected in the records of a Person maintaining an account with such Clearing Agency (directly or indirectly, in accordance with the rules of such Clearing Agency). "PAYING AGENT" means any paying agent or co-paying agent appointed pursuant to SECTION 5.9 and shall initially be the Bank. "PAYMENT ACCOUNT" means a segregated non-interest-bearing corporate trust account maintained by the Property Trustee with the Bank in its trust department for the benefit of the Securityholders in which all amounts paid in respect of the Debentures will be held and from which the Property Trustee, through the Paying Agent, shall make payments to the Securityholders in accordance with SECTIONS 4.1 and 4.2. "PERSON" means any individual, corporation, estate, partnership, joint venture, association, joint stock company, limited liability company, trust, unincorporated association, or government or any agency or political subdivision thereof, or any other entity of whatever nature. "PRIVATE CAPITAL SECURITIES" means the Trust's 8 1/8% Capital Securities issued pursuant to this Agreement in the initial aggregate Liquidation Amount of $300,000,000 on the initial Closing Date. "PRIVATE DEBENTURES" means the Depositor's 8 1/8% Junior Subordinated Deferrable Interest Debentures due September 1, 2031, issued pursuant to the Indenture in the initial aggregate principal amount of $309,300,000 on the initial Closing Date. "PRIVATE GUARANTEE" means the Guarantee extended by the Depositor for the benefit of the Holders of Private Capital Securities pursuant to the Guarantee Agreement. "PRIVATE PLACEMENT LEGEND" means the legend substantially in the form attached as Exhibit I. --------- "PROPERTY TRUSTEE" means the commercial bank or trust company identified as the "Property Trustee" in the preamble to this Trust Agreement solely in its capacity as Property Trustee of the Trust heretofore created and continued hereunder and not in its individual capacity, or its successor in interest in such capacity, or any successor Property Trustee appointed as herein provided. "PURCHASE AGREEMENT" means the Purchase Agreement, dated August 24, 2001, among the Trust, the Depositor and the Initial Purchaser. "QIB" means a "qualified institutional buyer" as defined in Rule 144A. "REDEMPTION DATE" means, with respect to any Trust Security to be redeemed, the date fixed for such redemption by or pursuant to this Trust Agreement; provided that each Debenture Redemption Date and the stated maturity of the Debentures shall be a Redemption Date for a Like Amount of Trust Securities. 9 "REDEMPTION PRICE" means, with respect to any Trust Security, the Liquidation Amount of such Trust Security, plus accumulated and unpaid Distributions to but excluding the Redemption Date, plus the related amount of the premium, if any, paid by the Depositor upon the concurrent redemption of a Like Amount of Debentures, allocated on a pro rata basis (based on Liquidation Amounts) among the Trust Securities. "REGULATION S" means Regulation S under the Securities Act or any successor provision. "REGULATION S GLOBAL SECURITY" has the meaning specified in SECTION 5.3(c). "RELEVANT TRUSTEE" has the meaning specified in SECTION 8.10. "RESPONSIBLE OFFICER," when used with respect to the Property Trustee, means any officer of the Property Trustee with direct responsibility for the administration of this Trust Agreement and also means with respect to a particular corporate trust matter, any other officer of the Property Trustee to whom such matter is referred by the Property Trustee because of his knowledge of, and familiarity with, a particular subject. "RULE 144" means Rule 144 as promulgated under the Securities Act, or any successor rule. "RULE 144A" means Rule 144A as promulgated under the Securities Act, or any successor rule. "RULE 144(k)" means Rule 144(k) as promulgated under the Securities Act, or any successor rule. "SECURITIES ACT" means the Securities Act of 1933, as amended. "SECURITIES REGISTER" and "SECURITIES REGISTRAR" have the respective meanings specified in SECTION 5.4. "SECURITYHOLDER" means a Person in whose name a Trust Security or Trust Securities is registered in the Securities Register; any such Person shall be a beneficial owner within the meaning of the Delaware Business Trust Act. "SPECIAL DISTRIBUTIONS" has the meaning specified in the Exchange and Registration Rights Agreement. "SPECIAL INTEREST" has the meaning specified in the Exchange and Registration Rights Agreement. "SUCCESSOR SECURITIES" has the meaning specified in SECTION 9.5. "TRANCHE" means Trust Securities issued after the initial Closing Date which are of the same series as the Trust Securities and have identical terms as the Trust Securities, except for aggregate Liquidation Amount, the price at which such Trust Securities are sold to the public and the date of issuance. 10 "TRANSFER RESTRICTION TERMINATION DATE" means the first day in which the Capital Securities (other than Capital Securities acquired by the Trust or any Affiliate thereof) may be sold pursuant to Rule 144(k). "TRUST" means the Delaware business trust created under the Original Trust Agreement and continued hereby and identified on the cover page to this Trust Agreement. "TRUST AGREEMENT" means this Amended and Restated Trust Agreement, as the same may be modified, amended or supplemented in accordance with the applicable provisions hereof, including (i) all exhibits hereto, and (ii) for all purposes of this Trust Agreement and any such modification, amendment or supplement, the provisions of the Trust Indenture Act that are deemed to be a part of and govern this Trust Agreement and any such modification, amendment or supplement, respectively. "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 as in force at the date as of which this instrument was executed; provided, however, that in the event the Trust Indenture Act of 1939 is amended after such date, "Trust Indenture Act" means, to the extent required by any such amendment, the Trust Indenture Act of 1939 as so amended. "TRUST PROPERTY" means (a) the Debentures, (b) any cash on deposit in, or owing to, the Payment Account and (c) all proceeds and rights in respect of the foregoing and any other property and assets for the time being held or deemed to be held by the Property Trustee pursuant to the trusts of this Trust Agreement. "TRUST SECURITY" or "TRUST SECURITIES" means any of the Common Securities and the Capital Securities. The Trust Securities represent undivided beneficial interests in the Trust Property. "TRUST SECURITIES CERTIFICATE" means any one of the Common Securities Certificates or the Capital Securities Certificates. "TRUSTEES" means, collectively, the Property Trustee, the Delaware Trustee and the Administrative Trustees. ARTICLE II CONTINUATION OF THE TRUST ------------------------- Section 2.1. Name. The Trust continued hereby shall be known as "DPL ---- CAPITAL TRUST II," as such name may be modified from time to time by the Administrative Trustees following written notice to the Securityholders and the other Trustees, in which name the Trustees may conduct the business of the Trust, make and execute contracts and other instruments on behalf of the Trust and sue and be sued. Section 2.2. Office of the Delaware Trustee; Principal Place of Business. ----------------------------------------------------------- The name and address of the Delaware Trustee in the State of Delaware is The Bank of New York (Delaware), White Clay Center, Route 273, Newark, Delaware 11 19711, Attention: Corporate Trust Department, or such other address in the State of Delaware as the Delaware Trustee may designate by written notice to the Securityholders and the Depositor. The principal executive office of the Trust is c/o DPL Inc., Courthouse Plaza Southwest, Dayton, Ohio 45402. Section 2.3. Initial Contribution of Trust Property; Organizational ------------------------------------------------------ Expenses. The Property Trustee acknowledges receipt in trust from the Depositor - -------- in connection with the Original Trust Agreement of the sum of $10, which constituted the initial Trust Property. The Depositor shall pay organizational expenses of the Trust as they arise or shall, upon request of any Trustee, promptly reimburse such Trustee for any such expenses paid by such Trustee. The Depositor shall make no claim upon the Trust Property for the payment of such expenses. Section 2.4. Issuance of the Capital Securities. (a) The Depositor, on ---------------------------------- behalf of the Trust and pursuant to the Original Trust Agreement, executed and delivered the Purchase Agreement. Contemporaneously with the execution and delivery of this Trust Agreement, on the initial Closing Date, an Administrative Trustee, on behalf of the Trust, shall execute in accordance with SECTION 5.2 and deliver to the Initial Purchaser Capital Securities Certificates in an initial aggregate amount of 300,000 Capital Securities having an initial aggregate Liquidation Amount of $300,000,000, against payment by the Initial Purchaser of $292,287,000, which amount the Administrative Trustee shall promptly deliver to the Trust. Pursuant to the procedures set forth in an Officers' Certificate, without the consent of the Holders of the then Outstanding Capital Securities, the Trust may subsequently issue from time to time Tranches of Capital Securities. (b) Contemporaneously with the exchange of Exchange Capital Securities pursuant to the Exchange and Registration Rights Agreement, an Administrative Trustee, on behalf of the Trust, shall execute in accordance with SECTION 5.2, and deliver in accordance with any then applicable delivery instructions, Capital Securities Certificates in an aggregate amount having an aggregate Liquidation Amount equal to the aggregate Liquidation Amount of the Private Capital Securities then being exchanged. Section 2.5. Issuance of the Common Securities; Subscription and Purchase ------------------------------------------------------------ of Debentures. Contemporaneously with the execution and delivery of this Trust - ------------- Agreement, on the initial Closing Date, an Administrative Trustee, on behalf of the Trust, shall execute in accordance with SECTION 5.2 and deliver to the Depositor Common Securities Certificates, registered in the name of the Depositor, in an initial aggregate amount of 9,300 Common Securities having an initial aggregate Liquidation Amount of $9,300,000 against payment by the Depositor of $9,060,897, which amount such Administrative Trustee shall promptly deliver to the Trust. Pursuant to the procedures set forth in an Officers' Certificate, the Trust may subsequently issue from time to time Tranches of Common Securities. Contemporaneously therewith, on the initial Closing Date, an Administrative Trustee, on behalf of the Trust, shall subscribe for and purchase from the Depositor Debentures, registered in the name of the Property Trustee, on behalf of the Trust, and having an initial aggregate principal amount equal to $309,300,000, and, in satisfaction of the purchase price for such Debentures, the Trust shall deliver to the Depositor the sum of $301,347,897 (such sum being the sum of the amounts delivered to the Property Trustee pursuant to (i) the second sentence of SECTION 2.4(a)and (ii) the first sentence of this SECTION 2.5). To the extent subsequent Tranches of Trust Securities are issued, 12 an Administrative Trustee, on behalf of the Trust, shall subscribe to and purchase from the Depositor on subsequent Closing Dates additional Debentures, registered in the name of the Trust having an aggregate principal amount equal to the aggregate Liquidation Amount of such Tranches of Trust Securities. Section 2.6. Declaration of Trust. The exclusive purposes and functions of -------------------- the Trust are (a) to issue and sell Trust Securities (including the Exchange Capital Securities pursuant to the Exchange Offer), (b) to use the proceeds from the sale of Trust Securities to acquire the Private Debentures, (c) to exchange the Private Debentures for the Exchange Debentures pursuant to the Indenture and (d) to engage in those activities necessary, convenient or incidental thereto. The Depositor hereby appoints the Property Trustee, the Delaware Trustee and the Administrative Trustees as trustees of the Trust, to have all the rights, powers and duties to the extent set forth herein, and the Property Trustee, the Delaware Trustee and the Administrative Trustees hereby accept such appointment. The Property Trustee hereby declares that it will hold the Trust Property in trust upon and subject to the conditions set forth herein for the benefit of the Trust and the Securityholders. The Administrative Trustees shall have all rights, powers and duties set forth herein and in accordance with applicable law with respect to accomplishing the purposes of the Trust. The Delaware Trustee shall not be entitled to exercise any powers, nor shall the Delaware Trustee have any of the duties and responsibilities, of the Property Trustee or the Administrative Trustees set forth herein. The Delaware Trustee shall be one of the Trustees of the Trust for the sole and limited purpose of fulfilling the requirements of Section 3807 of the Delaware Business Trust Act and accepting service of process on the Trust in the State of Delaware. Section 2.7. Authorization to Enter into Certain Transactions. (a) The ------------------------------------------------ Trustees shall conduct the affairs of the Trust in accordance with the terms of this Trust Agreement. Subject to the limitations set forth in paragraph (b) of this Section, and in accordance with the following provisions (i) and (ii), the Trustees shall have the authority to enter into all transactions and agreements determined by the Trustees to be appropriate in exercising the authority, express or implied, otherwise granted to the Trustees under this Trust Agreement, and to perform all acts in furtherance thereof, including without limitation, the following: (i) As among the Trustees, each Administrative Trustee shall have the power and authority to act on behalf of the Trust with respect to the following matters: (A) the issuance and sale of the Trust Securities including any agreements necessary with respect to such issuance and sale; (B) to cause the Trust to enter into, and to execute, deliver and perform on behalf of the Trust, the Exchange and Registration Rights Agreement, the Expense Agreement and the Certificate Depository Agreement and such other agreements as may be necessary or desirable in connection with the purposes and function of the Trust; (C) assisting in the registration of the Exchange Offer and the Exchange Capital Securities under the Securities Act, and under the state securities or blue sky laws, and the qualification of this Trust Agreement as a trust indenture under 13 the Trust Indenture Act, all in accordance with the Exchange and Registration Rights Agreement; (D) assisting in any listing of the Exchange Capital Securities upon such securities exchange or exchanges as shall be determined by the Depositor and the registration of the Exchange Capital Securities under the Exchange Act and the preparation and filing of all periodic and other reports and other documents pursuant to the foregoing; (E) the sending of notices (other than notices of default) and other information regarding the Trust Securities and the Debentures to the Securityholders in accordance with this Trust Agreement; (F) the appointment of a Paying Agent and Securities Registrar in accordance with this Trust Agreement; (G) executing the Trust Securities in accordance with this Trust Agreement; (H) to the extent provided in this Trust Agreement, the winding up of the affairs of and liquidation of the Trust and the preparation, execution and filing of the certificate of cancellation with the Secretary of State of the State of Delaware; (I) unless otherwise determined by the Depositor, the Property Trustee or the Administrative Trustees, or as otherwise required by the Delaware Business Trust Act or the Trust Indenture Act, to execute on behalf of the Trust (either acting alone or together with any or all of the Administrative Trustees) any documents that the Administrative Trustees have the power to execute pursuant to this Trust Agreement; and (J) the taking of any action incidental to the foregoing as the Trustees may from time to time determine is necessary or advisable to give effect to the terms of this Trust Agreement for the benefit of the Securityholders (without consideration of the effect of any such action on any particular Securityholder). (ii) As among the Trustees, the Property Trustee shall have the power, duty and authority to act on behalf of the Trust with respect to the following ministerial matters: (A) the establishment of the Payment Account; (B) the receipt of the Debentures; (C) the deposit of interest, principal and any other payments made in respect of the Debentures in the Payment Account; 14 (D) the distribution through the Paying Agent of amounts owed to the Securityholders in respect of the Trust Securities in accordance with the terms of this Trust Agreement; (E) the sending of notices of default and other information regarding the Trust Securities and the Debentures to the Securityholders in accordance with the terms of this Trust Agreement; (F) the distribution of the Trust Property in accordance with the terms of this Trust Agreement; (G) to the extent provided in this Trust Agreement, the winding up of the affairs of and liquidation of the Trust and the execution of the certificate of cancellation to be filed with the Secretary of State of the State of Delaware; (H) to exchange the Private Guarantee for the Exchange Guarantee in an exchange in connection with the Exchange Offer pursuant to the Exchange and Registration Rights Agreement; (I) to exchange the Private Debentures for the Exchange Debentures in an exchange in connection with the Exchange Offer pursuant to the Exchange and Registration Rights Agreement; and (J) after an Event of Default (other than under paragraph (d) or (e) of the definition of such term if such Event of Default is by or with respect to the Property Trustee), the taking of any action incidental to the foregoing as the Property Trustee may from time to time determine is necessary or advisable to give effect to the terms of this Trust Agreement and protect and conserve the Trust Property for the benefit of the Securityholders (without consideration of the effect of any such action on any particular Securityholder) and, within 90 days after the occurrence of any Event of Default actually known to a Responsible Officer of the Property Trustee assigned to its Corporate Trust Office, to give notice thereof to the Securityholders. Except as otherwise provided in this SECTION 2.7(a)(ii), or in the Trust Indenture Act (regardless of whether applicable or not), the Property Trustee shall have none of the duties, liabilities, powers or the authority of the Administrative Trustees set forth in SECTION 2.7(a)(i). The Property Trustee shall have the power and authority to exercise all of the rights, powers and privileges of a holder of the Debentures in accordance with the terms of this Trust Agreement. (b) So long as this Trust Agreement remains in effect, the Trust (or the Trustees acting on behalf of the Trust) shall not undertake any business, activities or transaction except as expressly provided herein or contemplated hereby. In particular, the Trustees on behalf of the Trust shall not (i) acquire any investments or engage in any activities not authorized by this Trust Agreement, (ii) sell, assign, transfer, exchange, mortgage, pledge, set-off or otherwise dispose of any of the Trust Property or interests therein, including to Securityholders, except as expressly provided herein, (iii) take 15 any action that would cause the Trust to fail or cease to qualify as a "grantor trust" for United States federal income tax purposes, (iv) incur any indebtedness for borrowed money or issue any other debt or (v) take or consent to any action that would result in the placement of a Lien on any of the Trust Property. The Administrative Trustees shall defend all claims and demands of all Persons at any time claiming any Lien on any of the Trust Property adverse to the interest of the Trust or the Securityholders in their capacity as Securityholders. (c) In connection with the issuance and sale of the Capital Securities, the Depositor shall have the right and responsibility to assist the Trust with respect to, or effect on behalf of the Trust, the following (and any actions taken by the Depositor in furtherance of the following prior to the date of this Trust Agreement are hereby ratified and confirmed in all respects): (i) negotiation of the terms of, and the execution and delivery of, the Purchase Agreement providing for the sale of the Capital Securities; (ii) the preparation of an offering memorandum and the preparation and filing by the Trust with the Commission and the execution on behalf of the Trust of a registration statement on the appropriate form in relation to the Exchange Offer, including any amendments thereto and/or a "shelf" registration statement to register the Private Capital Securities, the Private Guarantee and the Private Debentures, in each case in accordance with the provisions of the Exchange and Registration Rights Agreement; (iii) the determination of the states, if any, in which to take appropriate action to qualify or register for sale all or part of the Capital Securities, the Debentures and the Guarantee and the determination of any and all such acts, other than actions that must be taken by or on behalf of the Trust, and the advice to the Trustees of actions they must take on behalf of the Trust, and the preparation for execution and filing of any documents to be executed and filed by the Trust or on behalf of the Trust, as the Depositor deems necessary or advisable in order to comply with the applicable laws of any such state; and (iv) any other actions necessary or desirable to carry out any of the foregoing activities. (d) Notwithstanding anything herein to the contrary, the Administrative Trustees are authorized and directed to conduct the affairs of the Trust and to operate the Trust so that the Trust will not be deemed to be an "investment company" required to be registered under the 1940 Act or fail or cease to be classified as a grantor trust for United States federal income tax purposes and so that the Debentures will be treated as indebtedness of the Depositor for United States federal income tax purposes. In this connection, the Depositor and the Administrative Trustees are authorized to take any action, not inconsistent with applicable law, the Certificate of Trust or this Trust Agreement, that each of the Depositor and any Administrative Trustee determines in its discretion to be necessary or desirable for such purposes, as long as such action does not adversely affect in any material respect the interests of the Holders of the Capital Securities. 16 Section 2.8. Assets of Trust. The assets of the Trust shall consist of the --------------- Trust Property. Section 2.9. Title to Trust Property. Legal title to all Trust Property ----------------------- shall be vested at all times in the Property Trustee (in its capacity as such) and shall be held and administered by the Property Trustee for the benefit of the Trust and the Securityholders in accordance with this Trust Agreement. ARTICLE III PAYMENT ACCOUNT --------------- Section 3.1. Payment Account. (a) On or prior to the initial Closing Date, --------------- the Property Trustee shall establish the Payment Account. The Property Trustee and any agent of the Property Trustee shall have exclusive control and sole right of withdrawal with respect to the Payment Account for the purpose of making deposits in and withdrawals from the Payment Account in accordance with this Trust Agreement. All monies and other property deposited or held from time to time in the Payment Account shall be held by the Property Trustee in the Payment Account for the exclusive benefit of the Securityholders and for distribution as herein provided, including (and subject to) any priority of payments provided for herein. (b) The Property Trustee shall deposit in the Payment Account, promptly upon receipt, all payments of principal of or interest on, and any other payments or proceeds with respect to, the Debentures. Amounts held in the Payment Account shall not be invested by the Property Trustee pending distribution thereof. ARTICLE IV DISTRIBUTIONS; REDEMPTION ------------------------- Section 4.1. Distributions. (a) Distributions will be made on the Trust ------------- Securities at the rate and on the dates that payments of interest are made on the Debentures. Distributions on the Trust Securities shall be cumulative, and will accumulate whether or not there are funds of the Trust available for the payment of Distributions. Distributions shall accumulate from August 31, 2001 and, except in the event (and to the extent) that the Depositor exercises its right to defer the payment of interest on the Debentures pursuant to the Indenture, shall be payable semiannually in arrears on March 1 and September 1 of each year, commencing on March 1, 2002. If any date on which a Distribution is otherwise payable on the Trust Securities is not a Business Day, then the payment of such Distribution shall be made on the next succeeding day that is a Business Day (and without any interest or other payment in respect of any such delay), in each case, with the same force and effect as if made on such date (each date on which Distributions are payable in accordance with this SECTION 4.1(a), a "DISTRIBUTION DATE"). (b) Assuming payments of interest on the Debentures are made when due and assuming compliance by the Depositor and the Trust with their obligations under the Exchange and Registration Rights Agreement (and before giving effect to any Additional Distributions, Special Distributions and Additional Tax Sums, if applicable), Distributions on the Trust Securities shall 17 be payable at a rate of 8 1/8% per annum of the Liquidation Amount of the Trust Securities. The amount of Distributions payable for any full period shall be computed on the basis of a 360-day year of twelve 30-day months. The amount of Distributions for any partial period shall be computed on the basis of the number of days elapsed in a 360-day year of twelve 30-day months. The amount of Distributions payable for any period shall include the Additional Distributions, Special Distributions and Additional Tax Sums, if any. (c) Distributions on the Trust Securities shall be made by the Property Trustee from the Payment Account and shall be payable on each Distribution Date only to the extent that the Trust has funds then on hand and available in the Payment Account for the payment of such Distributions. (d) Distributions on the Trust Securities with respect to a Distribution Date shall be payable to the Holders thereof as they appear on the Securities Register for the Trust Securities on the relevant record date, which shall be the 15th day of the month immediately prior to the month in which the relevant Distribution Date occurs or if such 15th day of the month is not a Business Day, then the Business Day next preceding such day. Section 4.2. Redemption. (a) On each Debenture Redemption Date and on the ---------- stated maturity of the Debentures, the Trust will be required to redeem a Like Amount of Trust Securities at the Redemption Price. (b) Notice of redemption shall be given by the Property Trustee by first- class mail, postage prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption Date to each Holder of Trust Securities to be redeemed, at such Holder's address appearing in the Security Register. All notices of redemption shall state: (i) the Redemption Date; (ii) the Redemption Price, or if the Redemption Price cannot be calculated prior to the time the notice of redemption is required to be sent, the manner of calculation thereof; (iii) the CUSIP number; (iv) if less than all the Outstanding Trust Securities are to be redeemed, the identification and the total Liquidation Amount of the particular Trust Securities to be redeemed; and (v) that on the Redemption Date the Redemption Price will become due and payable upon each such Trust Security to be redeemed and that Distributions thereon will cease to accumulate on and after said date. (c) The Trust Securities redeemed on each Redemption Date shall be redeemed at the Redemption Price with the proceeds from the contemporaneous redemption of Debentures. Redemptions of the Trust Securities shall be made and the Redemption Price shall be payable on each Redemption Date only to the extent that the Trust has funds then on hand and available in the Payment Account for the payment of such Redemption Price. 18 (d) If the Property Trustee gives a notice of redemption in respect of any Capital Securities, then, by 10:00 a.m., New York City time, on the Redemption Date, the Depositor shall deposit sufficient funds with the Property Trustee to pay the Redemption Price. If such deposit has been made, then, by 12:00 noon, New York City time, on the Redemption Date, subject to SECTION 4.2(c), the Property Trustee will, with respect to Capital Securities evidenced by one or more Global Capital Securities Certificates, irrevocably deposit with the Clearing Agency for such Capital Securities funds sufficient to pay the applicable Redemption Price and will give such Clearing Agency irrevocable instructions and authority to pay the Redemption Price to the Holders thereof. With respect to Capital Securities evidenced by one or more Definitive Capital Securities Certificates, the Property Trustee, subject to SECTION 4.2(c), will irrevocably deposit with the Paying Agent funds sufficient to pay the applicable Redemption Price and will give the Paying Agent irrevocable instructions and authority to pay the Redemption Price with respect to such Capital Securities to the Holders thereof upon surrender of their Definitive Capital Securities Certificates. Notwithstanding the foregoing, Distributions payable on or prior to the Redemption Date for any Trust Securities called for redemption shall be payable to the Holders of such Trust Securities as they appear on the Securities Register for the Trust Securities on the relevant record dates for the related Distribution Dates. If notice of redemption has been given and funds deposited as required, then upon the date of such deposit, all rights of Securityholders holding Trust Securities so called for redemption will cease, except the right of such Securityholders to receive the Redemption Price and any Distribution payable on or prior to the Redemption Date, but without interest, and such Trust Securities will cease to be outstanding. In the event that any date on which any Redemption Price is payable is not a Business Day, then payment of the Redemption Price payable on such date will be made on the next succeeding day that is a Business Day (and without any interest or other payment in respect of any such delay), in each case, with the same force and effect as if made on such date. In the event that payment of the Redemption Price in respect of any Trust Securities called for redemption is improperly withheld or refused and not paid either by the Trust or by the Depositor pursuant to the Guarantee, Distributions on such Trust Securities will continue to accumulate, at the then applicable distribution rate, from the Redemption Date originally established by the Trust for such Trust Securities to the date such Redemption Price is actually paid, in which case the actual payment date will be the date fixed for redemption for purposes of calculating the Redemption Price. (e) Payment of the Redemption Price on the Trust Securities shall be made to the Holders thereof as they appear on the Securities Register for the Trust Securities on a date to be established as the record date for the distribution by the Property Trustee, which date shall be not more than 45 days nor less than 15 days prior to the relevant Redemption Date. (f) Subject to SECTION 4.3(a), if less than all the Outstanding Trust Securities are to be redeemed on a Redemption Date, then the aggregate Liquidation Amount of Trust Securities to be redeemed shall be allocated on a pro rata basis (based on Liquidation Amounts) among the Common Securities and the Capital Securities. The particular Capital Securities to be redeemed shall be selected not less than 15 nor more than 60 days prior to the Redemption Date by the Property Trustee from the Outstanding Capital Securities not previously called for redemption, by such method (including, without limitation, on a pro rata basis or by lot) as the Property Trustee shall deem fair and appropriate and which may provide for the selection for redemption of portions (equal to $1,000 or an integral multiple of $1,000 in excess thereof) 19 of the Liquidation Amount of Capital Securities of a denomination larger than $1,000; provided, however, that redemption must be pro rata on the basis of the Outstanding Capital Securities held by each Holder unless the Property Trustee advised by Opinion of Counsel determines that non-pro rata redemption will not cause the Trust to fail or cease to be classified as a grantor trust for United States federal income tax purposes or, if the Trust might fail or cease to be classified as a grantor trust, will not cause the Trust to be classified as an association taxable as a corporation for United States federal income tax purposes. In any such proration the Property Trustee may make such adjustments so that any Capital Security to be redeemed shall, after such redemption, be in an authorized denomination. The Property Trustee shall promptly notify the Securities Registrar in writing of the Capital Securities selected for redemption and, in the case of any Capital Securities selected for partial redemption, the Liquidation Amount thereof to be redeemed. For all purposes of this Trust Agreement, unless the context otherwise requires, all provisions relating to the redemption of Capital Securities shall relate, in the case of any Capital Securities redeemed or to be redeemed only in part, to the portion of the Liquidation Amount of Capital Securities that has been or is to be redeemed. Section 4.3. Subordination of Common Securities. (a) Payment of ---------------------------------- Distributions on, and the Redemption Price of, the Trust Securities, as applicable, shall be made, subject to SECTION 4.2(f), pro rata among the Common Securities and the Capital Securities based on the Liquidation Amount of the Trust Securities; provided, however, that if on any Distribution Date or Redemption Date any Event of Default resulting from a Debenture Event of Default has occurred and is continuing, no payment of any Distribution on, or the Redemption Price of, any Common Security, and no other payment on account of the redemption, liquidation or other acquisition of Common Securities, shall be made unless payment in full in cash of all accumulated and unpaid Distributions on all Outstanding Capital Securities for all Distribution periods terminating on or prior thereto, or in the case of payment of the Redemption Price the full amount of such Redemption Price on all Outstanding Capital Securities, has been made or provided for, and all funds immediately available to the Property Trustee shall first be applied to the payment in full in cash of all Distributions on, or the Redemption Price of, Capital Securities then due and payable. (b) In the case of the occurrence of any Event of Default resulting from any Debenture Event of Default, the Holder of Common Securities will be deemed to have waived any right to act with respect to any such Event of Default under this Trust Agreement until the effect of all such Events of Default with respect to the Capital Securities have been cured, waived or otherwise eliminated. Until any such Event of Default under this Trust Agreement with respect to the Capital Securities has been so cured, waived or otherwise eliminated, the Property Trustee shall act solely on behalf of the Holders of the Capital Securities and not the Holder of the Common Securities, and only the Holders of the Capital Securities will have the right to direct the Property Trustee to act on their behalf. Section 4.4. Payment Procedures. Payments of Distributions in respect of ------------------ the Capital Securities shall be made by check mailed to the address of the Person entitled thereto as such address shall appear on the Securities Register or, if the Capital Securities are held by a Clearing Agency, such Distributions shall be made in immediately available funds to the Clearing Agency, which shall credit the relevant Persons' accounts at such Clearing Agency on the applicable Distribution Dates. Payments in respect of the Common Securities shall be made 20 in such manner as shall be mutually agreed between the Property Trustee and the Holder of the Common Securities. Section 4.5. Tax Returns and Reports. The Administrative Trustees shall ----------------------- prepare (or cause to be prepared), at the Depositor's expense, and file all United States federal, state and local tax and information returns and reports required to be filed by or in respect of the Trust. In this regard, the Administrative Trustees shall (a) prepare and file (or cause to be prepared and filed) the appropriate Internal Revenue Service Form required to be filed in respect of the Trust in each taxable year of the Trust and (b) prepare and furnish (or cause to be prepared and furnished) to each Securityholder the appropriate Internal Revenue Service form required to be provided on such form. The Administrative Trustees shall provide the Depositor and the Property Trustee with a copy of all such returns and reports promptly after such filing or furnishing. The Trustees shall comply with United States federal withholding and backup withholding tax laws and information reporting requirements with respect to any payments to Securityholders under the Trust Securities. Section 4.6. Payment of Taxes, Duties, Etc. of the Trust. Upon receipt ------------------------------------------- under the Debentures of Additional Tax Sums and the written direction of any of the Administrative Trustees, the Property Trustee shall promptly pay, solely out of monies on deposit pursuant to this Trust Agreement, any taxes, duties or governmental charges of whatsoever nature (other than withholding taxes) imposed on the Trust by the United States or any other taxing authority. Section 4.7. Reduction for Payments under Indenture or Pursuant to Direct ------------------------------------------------------------ Actions. Any amount payable hereunder to any Holder of Capital Securities shall - ------- be reduced by the amount of any corresponding payment such Holder (or an Owner with respect to the Holder's Capital Securities) has directly received pursuant to Section 6.05 of the Indenture or SECTION 5.14. Notwithstanding any such payments, the Depositor shall remain obligated to pay the principal of or interest on the Debentures and the Depositor shall be subrogated to the rights of the Holder (and Owner) of such Capital Securities with respect to payments on the Capital Securities to the extent of any payments made by the Depositor to such Holder (and Owner) pursuant to either of such Sections. ARTICLE V TRUST SECURITIES CERTIFICATES ----------------------------- Section 5.1. Initial Ownership. Upon the creation of the Trust and the ----------------- contribution by the Depositor referred to SECTION 2.3 and until the issuance of the Trust Securities, and at any time during which no Trust Securities are outstanding, the Depositor shall be the sole beneficial owner of the Trust. Section 5.2. The Trust Securities Certificates; Execution and Delivery --------------------------------------------------------- Thereof. The Capital Securities Certificates shall be issued in denominations of - ------- $1,000 Liquidation Amount and integral multiples of $1,000 in excess thereof, and the Common Securities Certificates shall be issued in denominations of $1,000 Liquidation Amount and integral multiples of $1,000 in excess thereof. The Trust Securities Certificates shall be executed on behalf of the Trust by manual signature of at least one Administrative Trustee. Trust Securities 21 Certificates bearing the manual signatures of individuals who were, at the time when such signatures shall have been affixed, authorized to sign on behalf of the Trust, shall be validly issued and entitled to the benefits of this Trust Agreement, notwithstanding that such individuals or any of them shall have ceased to be so authorized prior to the delivery of such Trust Securities Certificates or did not hold such offices at the date of delivery of such Trust Securities Certificates. A transferee of a Trust Securities Certificate shall become a Securityholder, and shall be entitled to the rights and subject to the obligations of a Securityholder hereunder, upon due registration of such Trust Securities Certificate in such transferee's name pursuant to SECTIONS 5.4, 5.11 and 5.13. At the initial Closing Date, the Administrative Trustees, or any of them, shall cause Trust Securities Certificates, in an aggregate Liquidation Amount as provided in Sections 2.4 and 2.5, to be executed on behalf of the Trust and delivered (i) with respect to the Capital Securities Certificates to the Initial Purchaser, against payment therefor, pursuant to the Purchase Agreement and (ii) with respect to the Common Securities Certificates, to the Depositor, in each case, without further corporate action by the Depositor, in authorized denominations. To the extent subsequent Tranches of Securities are issued on subsequent Closing Dates, as provided in SECTIONS 2.4 and 2.5 an Administrative Trustee shall cause Trust Securities Certificates in the applicable aggregate Liquidation Amount to be executed and delivered on behalf of the Trust pursuant to the procedures set forth in an Officers' Certificate. Section 5.3. Form of Trust Securities Certificates. (a) A single Common ------------------------------------- Securities Certificate representing the Common Securities shall be issued to the Depositor in the form of a definitive Common Securities Certificate. (b) Capital Securities offered and sold in reliance on Rule 144A shall be issued initially in the form of one or more permanent global Capital Securities, substantially in the form of Exhibit B (a "144A GLOBAL SECURITY"), deposited with the Clearing Agency or the Property Trustee as custodian for the Clearing Agency. Transfers of beneficial interests in the 144A Global Security will be subject to the restrictions on transfer contained in the Private Placement Legend. Transfers of beneficial interests in the 144A Global Security will be made in accordance with the standing instructions and procedures of the Clearing Agency. (c) Capital Securities offered and sold in offshore transactions in reliance on Regulation S shall be issued initially in the form of one or more permanent global Capital Securities, substantially in the form of Exhibit C (a "REGULATION S GLOBAL SECURITY"), deposited with the Clearing Agency - --------- or the Property Trustee as custodian for the Clearing Agency. Prior to the expiration of the Distribution Compliance Period, beneficial interests in the Regulation S Global Security may only be held by Clearing Agency Participants in the name of a nominee of Euroclear or Clearstream. After the expiration of the Distribution Compliance Period, transfers of beneficial interests in the Regulation S Global Security will not be subject to any restrictions and may be held by Clearing Agency Participants other than in the name of a nominee of Euroclear or Clearstream. Transfers of beneficial interests in the Regulation S Global Security will be made in accordance with the standing instructions and procedures of the Clearing Agency. (d) Capital Securities offered and sold to Institutional Accredited Investors in reliance on Section 4(2) of the Securities Act shall be issued initially in the form of one or more Definitive Capital Securities 22 Certificates, substantially in the form of Exhibit D. Transfers of Definitive --------- Capital Securities Certificates will be subject to the Private Placement Legend and the requirements contained in SECTION 5.11(d)(1) or 5.11(d)(2). (e) All Trust Securities shall be dated the date of their execution. (f) Exchange Capital Securities shall be issued in global form deposited with the Clearing Agency or the Property Trustee as custodian for the Clearing Agency or in such other form as the Administrative Trustees may direct. Section 5.4. Registration of Transfer and Exchange of Capital Securities ----------------------------------------------------------- Certificates. (a) The Depositor shall keep or cause to be kept, at the office or - ------------ agency maintained pursuant to SECTION 5.8, a register for the purpose of registering Trust Securities Certificates and transfers and exchanges of Capital Securities Certificates (the "SECURITIES REGISTER") in which the registrar designated by the Depositor (the "SECURITIES REGISTRAR"), subject to such reasonable regulations as it may prescribe, shall provide for the registration of Capital Securities Certificates and Common Securities Certificates and registration of transfers and exchanges of Capital Securities Certificates, subject to SECTION 5.10, SECTION 5.11 and as may otherwise be provided herein. The Bank shall be the initial Securities Registrar. The Securities Registrar shall not be required to register the transfer or exchange of any Capital Securities (x) during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of Capital Securities and ending at the close of business on the day of such mailing or (y) that have been selected for redemption in whole or in part, except the unredeemed portion of any Capital Security redeemed in part. (b) Capital Securities Certificate at the office or agency maintained pursuant to SECTION 5.8 and subject to compliance with SECTION 5.11, the Administrative Trustees or any one of them shall execute and deliver, in the name of the designated transferee or transferees, one or more new Capital Securities Certificates in authorized denominations of a like aggregate Liquidation Amount dated the date of execution by such Administrative Trustee or Trustees. Subject to SECTION 5.11, at the option of a Holder, Capital Securities Certificates may be exchanged for other Capital Securities Certificates in authorized denominations of the same class and of a like aggregate Liquidation Amount upon surrender of the Capital Securities Certificates to be exchanged at the office or agency maintained pursuant to SECTION 5.8. (c) Every Capital Securities Certificate presented or surrendered for registration of transfer or exchange shall be accompanied by a written instrument of transfer in form satisfactory to an Administrative Trustee and the Securities Registrar duly executed by the Holder or his attorney duly authorized in writing. Each Capital Securities Certificate surrendered for registration of transfer or exchange shall be cancelled and subsequently disposed of by an Administrative Trustee or the Securities Registrar in accordance with such Person's customary practice; provided that no exchanges of Private Capital Securities for Exchange Capital Securities shall occur until a registration statement has been declared effective by the Commission and that any Private Capital Securities that are exchanged for Exchange Capital Securities shall be canceled by the Property Trustee. 23 (d) No service charge shall be made for any registration of transfer or exchange of Capital Securities Certificates, but the Securities Registrar may require payment of a sum sufficient to cover any tax or governmental charge that may be imposed in connection with any transfer or exchange of Capital Securities Certificates. Section 5.5. Mutilated, Destroyed, Lost or Stolen Trust Securities ----------------------------------------------------- Certificates. If (a) any mutilated Trust Securities Certificate is surrendered - ------------ to the Securities Registrar, or if the Securities Registrar receives evidence to its satisfaction of the destruction, loss or theft of any Trust Securities Certificate and (b) there is delivered to the Securities Registrar and the Administrative Trustees such security or indemnity as may be required by them to save each of them harmless, then in the absence of notice that such Trust Securities Certificate has been acquired by a bona fide purchaser, the Administrative Trustees, or any one of them, on behalf of the Trust shall execute and make available for delivery, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Trust Securities Certificate, a new Trust Securities Certificate of like class, tenor and denomination. In connection with the issuance of any new Trust Securities Certificate under this Section, the Administrative Trustees or the Securities Registrar may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith. Any duplicate Trust Securities Certificate issued pursuant to this Section shall constitute conclusive evidence of an undivided beneficial interest in the Trust Property, as if originally issued, whether or not the lost, stolen or destroyed Trust Securities Certificate is found at any time. Section 5.6. Persons Deemed Securityholders. The Trustees or the ------------------------------ Securities Registrar shall treat the Person in whose name any Trust Securities Certificate is registered in the Securities Register as the owner of such Trust Securities Certificate for the purpose of receiving Distributions and for all other purposes whatsoever (subject to the record date provisions hereof), and neither the Trustees nor the Securities Registrar shall be bound by any notice to the contrary. Section 5.7. Access to List of Securityholders' Names and Addresses. At ------------------------------------------------------ any time when the Property Trustee is not also acting as the Securities Registrar, the Depositor shall furnish or cause to be furnished to the Property Trustee promptly after receipt by an Administrative Trustee of a request therefor from the Property Trustee in writing, a list, in such form as the Property Trustee may reasonably require, of the names and addresses of the Securityholders as of the most recent record date. The rights of Securityholders to communicate with other Securityholders with respect to their rights under this Trust Agreement or under the Trust Securities, and the corresponding obligations and rights of the Property Trustee, shall be as provided in the Trust Indenture Act. Each Holder, by receiving and holding a Trust Securities Certificate, and each Owner shall be deemed to have agreed not to hold the Depositor, the Property Trustee or the Administrative Trustees accountable by reason of the disclosure of its name and address, regardless of the source from which such information was derived. Section 5.8. Maintenance of Office or Agency for Transfers. The --------------------------------------------- Administrative Trustees shall maintain an office or offices or agency or agencies where Capital Securities Certificates may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Trustees in respect of the Trust Securities Certificates may be served. The Administrative Trustees initially designate the Corporate Trust Office of the Property Trustee, as the principal corporate trust office for such purposes. The 24 Administrative Trustees shall give prompt written notice to the Depositor and to the Securityholders of any change in the location of the Securities Register or any such office or agency. Section 5.9. Appointment of Paying Agent. The Paying Agent shall make --------------------------- Distributions to Securityholders from the Payment Account and shall report the amounts of such Distributions to the Property Trustee and the Administrative Trustees. Any Paying Agent shall have the revocable power to withdraw funds from the Payment Account for the purpose of making the Distributions referred to above. The Administrative Trustees may revoke such power and remove the Paying Agent if such Trustees determine in their sole discretion that the Paying Agent has failed to perform its obligations under this Trust Agreement in any material respect. The Paying Agent shall initially be the Bank, and any co-paying agent chosen by the Bank, and acceptable to the Administrative Trustees and the Depositor. Any Person acting as Paying Agent shall be permitted to resign as Paying Agent upon 30 days' written notice to the Administrative Trustees, the Property Trustee and the Depositor. In the event that the Bank is no longer the Paying Agent or a successor Paying Agent resigns or its authority to act revoked, the Administrative Trustees shall appoint a successor that is acceptable to the Property Trustee and the Depositor to act as Paying Agent (which shall be a bank or trust company). The Administrative Trustees shall cause such successor Paying Agent or any additional Paying Agent appointed by the Administrative Trustees to execute and deliver to the Trustees an instrument in which such successor Paying Agent or additional Paying Agent shall agree with the Trustees that as Paying Agent, such successor Paying Agent or additional Paying Agent will hold all sums, if any, held by it for payment to the Securityholders in trust for the benefit of the Securityholders entitled thereto until such sums are paid to such Securityholders. The Paying Agent shall return all unclaimed funds to the Property Trustee and upon removal of a Paying Agent such Paying Agent shall also return all funds in its possession to the Property Trustee. The provisions of SECTIONS 8.2, 8.4 and 8.6 herein shall apply to the Bank also in its role as Paying Agent, for so long as the Bank acts as Paying Agent and, to the extent applicable, to any other paying agent appointed hereunder. Any reference in this Agreement to the Paying Agent shall include any co-paying agent unless the context requires otherwise. Section 5.10. Ownership of Common Securities by Depositor. At the initial ------------------------------------------- Closing Date, and at any subsequent Closing Dates, the Depositor shall acquire and retain beneficial and record ownership of the Common Securities. To the fullest extent permitted by law, other than a transfer in connection with a consolidation, conversion or merger of the Depositor into another Person, or any conveyance, transfer or lease by the Depositor of its properties and assets substantially as an entirety to any Person, pursuant to Article Eleven of the Indenture, any attempted transfer of the Common Securities shall be void. The Administrative Trustees shall cause each Common Securities Certificate issued to the Depositor to contain a legend stating "THIS CERTIFICATE IS NOT TRANSFERABLE." Section 5.11. Book-Entry Interests. (a) So long as the Private Capital -------------------- Securities are eligible for book-entry settlement in the Clearing Agency or unless otherwise required by law, all Private Capital Securities that are so eligible will be represented by one or more Global Capital Securities Certificates deposited with the Clearing Agency or the Property Trustee as custodian for the Clearing Agency, by, or on behalf of, the Trust. No Owner of a beneficial interest in a Global Capital Securities Certificate will receive a Definitive Capital Securities Certificate representing such Owner's beneficial interest in the Private Capital Securities, except as provided in 25 SECTION 5.11(f) below; provided, however, that the Trust shall issue a Definitive Capital Securities Certificate upon any transfer of a beneficial interest in a Global Capital Security to the Company or an Affiliate of the Company and no Definitive Capital Securities Certificate, or portion thereof, in respect of which the Company or an Affiliate of the Company held any beneficial interest shall be resold, retransferred or included in any Global Capital Security until such Private Capital Security is freely tradeable in accordance with Rule 144(k) or exchanged for an Exchange Capital Security. (b) 144A Global Securities shall initially be registered in the name of a nominee of the Clearing Agency and Regulation S Global Securities shall initially be registered in the name of a nominee for the Clearing Agency for the accounts of Euroclear and Clearstream. (c) Transfers of interests in Private Capital Securities between any 144A Global Security and any Regulation S Global Security will be made in accordance with this Trust Agreement (including SECTION 5.11(d)(3) and (4), as applicable) and in accordance with the standing instructions and procedures of the Clearing Agency. The Property Trustee shall make appropriate endorsements to reflect increases or decreases in the amount of such Global Capital Securities. (d) Unless and until the earlier of (i) the date upon which Private Capital Securities are exchanged for Exchange Capital Securities in connection with an effective registration statement pursuant to the Exchange and Registration Rights Agreement or (ii) the Transfer Restriction Termination Date: (1) Definitive to Definitive Transfers. Any transfer of ---------------------------------- a Definitive Capital Securities Certificate shall be registered on the Securities Register only upon receipt by the Property Trustee of such Definitive Capital Securities Certificate accompanied by a duly completed and executed assignment in the form attached to Exhibit D and, in the --------- case of a transfer to an Institutional Accredited Investor, upon receipt by the Property Trustee of a written certificate in the form of Exhibit F (or other certifications, legal opinions or other information as the Depositor may reasonably request to confirm that such transfer is exempt from the registration requirements of the Securities Act); (2) Definitive into a Global Capital Security. So long ----------------------------------------- as Private Capital Securities are eligible for book-entry settlement with the Clearing Agency or unless otherwise required by law, upon any transfer of a Definitive Capital Securities Certificate to a QIB in accordance with Rule 144A or to a non-U.S. Person in accordance with Regulation S, and upon receipt of the Definitive Capital Securities Certificate being so transferred accompanied by a duly completed and executed assignment in the form attached to Exhibit D, the Property Trustee on behalf of the Trust shall --------- make an endorsement on any 144A Global Security or any Regulation S Global Security, as the case may be, to reflect an increase in such Global Capital Security and the Property Trustee, on behalf of the Trust, shall cancel such Definitive Capital Securities Certificates; 26 (3) 144A Global Security into Regulation S Global --------------------------------------------- Security. Any transfer in accordance with Rule 904 of -------- Regulation S of a beneficial interest in a 144A Global Security shall be reflected by an increase in the Regulation S Global Security and a corresponding decrease in the 144A Global Security, in each case by the Property Trustee on behalf of the Trust making an endorsement on such Global Capital Security, only upon receipt by the Property Trustee of a written certificate in the form of Exhibit G (or such other certifications, legal opinions or other information as the Depositor may reasonably require to confirm that such transfer is being made pursuant to such Rule 904); and (4) Regulation S Global Security into 144A Global --------------------------------------------- Security. Any transfer of a beneficial interest in a -------- Regulation S Global Security to a transferee that takes delivery in the form of a beneficial interest in the 144A Global Security shall be reflected by an increase in the 144A Global Security and a corresponding decrease in the Regulation S Global Security, in each case by the Property Trustee on behalf of the Trust making an endorsement on such Global Capital Security and, prior to the expiration of the Distribution Compliance Period, only upon receipt by the Property Trustee of a written certificate in the form of Exhibit H (or such other certifications, legal opinions or other information as the Depositor may reasonably require). (e) Any Global Capital Security may be endorsed with or have incorporated in the text thereof such legends or recitals or changes not inconsistent with the provisions of this Trust Agreement as may be required by the Clearing Agency, by any national securities exchange or by the National Association of Securities Dealers, Inc. or as may be required for the Private Capital Securities to be tradeable on any other market developed for trading of securities pursuant to Rule 144A or required to comply with any applicable law or any regulation thereunder or with the rules and regulations of any securities exchange upon which the Capital Securities may be listed or traded or to conform with any usage with respect thereto, or to indicate any special limitations or restrictions to which any particular Capital Securities are subject. (f) Notwithstanding any other provisions of this Trust Agreement (other than the provisions set forth in this SECTION 5.11(f)), a Global Capital Security may not be exchanged in whole or in part for Definitive Capital Securities Certificates, and no transfer of a Global Capital Security may be registered, in the name of any Person other than the Clearing Agency or a nominee thereof unless (i) such Clearing Agency (A) has notified the Property Trustee and the Depositor that it is unwilling or unable to continue as Clearing Agency for such Global Capital Security or (B) has ceased to be a clearing agency registered as such under the Exchange Act and no successor Clearing Agency has been appointed by the Depositor within 90 days after its receipt of such notice or its becoming aware of such cessation of registration, (ii) there has occurred and is continuing an Event of Default, or any event that after notice or lapse of time or both would be an Event of Default under the Trust Agreement, with respect to such Capital Security or (iii) the Depositor in its discretion instructs the Property Trustee to exchange such Global Capital Security for Definitive Capital Securities Certificates (in which case such exchange shall be effected by the Property Trustee). 27 (g) Unless and until Definitive Capital Securities Certificates have been issued to Owners pursuant to SECTION 5.13, the following provisions of this SECTION 5.11(g) shall be in full force and effect: (i) the Securities Registrar and the Trustees shall be entitled to deal with the Clearing Agency for all purposes of this Trust Agreement relating to the Global Capital Securities (including the payment of the Liquidation Amount of and Distributions on the Capital Securities evidenced by Global Capital Securities Certificates and the giving of instructions or directions to Owners of Capital Securities evidenced by Global Capital Securities) as the sole Holder of Capital Securities evidenced by Global Capital Securities and shall have no obligations to the Owners thereof; and (ii) the rights of the Owners of the Global Capital Securities shall be exercised only through the Clearing Agency and shall be limited to those established by law and agreements between such Owners and the Clearing Agency and/or the Clearing Agency Participants. Pursuant to the Certificate Depository Agreement, unless and until Definitive Capital Securities Certificates are issued pursuant to this SECTION 5.11 or SECTION 5.13, the initial Clearing Agency will make book-entry transfers among the Clearing Agency Participants and receive and transmit payments on the Capital Securities to such Clearing Agency Participants. (h) The Administrative Trustees shall inform the Property Trustee in writing of the effective date of any registration statement registering the Exchange Capital Securities under the Securities Act. Upon the receipt of a certificate from the Administrative Trustees, the Property Trustee will take such actions as shall be necessary to effectuate the exchange of any of the Private Capital Securities for Exchange Capital Securities, including but not limited to the issuance of Exchange Capital Securities in the form requested by the Administrative Trustees, the entry of decreases in the Regulation S Global Security and the 144A Global Security or, if applicable, the cancellation of Definitive Capital Securities Certificates. (i) Any beneficial interest in one of the Global Capital Securities that is transferred to an Owner who takes delivery in the form of an interest in the other Global Capital Securities will, upon transfer, cease to be an interest in the former Global Capital Security and will become an interest in the latter Global Capital Security and, accordingly, will thereafter be subject to all transfer restrictions and other procedures applicable to beneficial interests in such latter Global Capital Security for so long as it remains such an interest. Section 5.12. Notices to Clearing Agency. To the extent that a notice or -------------------------- other communication to the Owners is required under this Trust Agreement, unless and until Definitive Capital Securities Certificates shall have been issued to Owners pursuant to SECTION 5.13, the Trustees shall give all such notices and communications specified herein to be given to Owners to the Clearing Agency, and shall have no obligations to the Owners. Section 5.13. Procedures for Issuance of Definitive Capital Securities -------------------------------------------------------- Certificates. Upon surrender to the Securities Registrar of the typewritten - ------------ Capital Securities Certificate or Certificates representing the Global Capital Securities Certificates by the Clearing Agency upon occurrence of any of the events described in SECTION 5.11(f), accompanied by registration instructions, 28 the Administrative Trustees, or any one of them, shall execute and the Securities Registrar shall register the Definitive Capital Securities Certificates in accordance with the instructions of the Clearing Agency. Neither the Securities Registrar nor the Trustees shall be liable for any delay in delivery of such instructions and may conclusively rely on, and shall be protected in relying on, such instructions. Upon the issuance of Definitive Capital Securities Certificates, the Trustees shall recognize the Holders of the Definitive Capital Securities Certificates as Securityholders. The Definitive Capital Securities Certificates shall be printed, lithographed or engraved or may be produced in any other manner as is reasonably acceptable to the Administrative Trustees, as evidenced by the execution thereof by the Administrative Trustees or any one of them. Section 5.14. Rights of Securityholders. (a) The legal title to the Trust ------------------------- Property is vested exclusively in the Property Trustee (in its capacity as such) in accordance with SECTION 2.9, and the Securityholders shall not have any right or title therein other than the undivided beneficial interest in the assets of the Trust conferred by their Trust Securities and they shall have no right to call for any partition or division of property, profits or rights of the Trust except as described below. The Trust Securities shall be personal property giving only the rights specifically set forth therein and in this Trust Agreement. The Trust Securities shall have no preemptive or similar rights. When issued and delivered to Securityholders against payment of the purchase price therefor, the Capital Securities will be fully paid and nonassessable undivided beneficial interests in the Trust Property. The Holders of the Capital Securities, in their capacities as such, shall be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the General Corporation Law of the State of Delaware. (b) For so long as any Capital Securities remain Outstanding, if, upon a Debenture Event of Default, the Debenture Trustee fails or the Holders of not less than 25% in principal amount of the outstanding Debentures fail to declare the principal of all of the Debentures to be immediately due and payable, the Holders of at least 25% in Liquidation Amount of the Capital Securities then Outstanding shall have such right by a notice in writing to the Depositor and the Debenture Trustee; and upon any such declaration such principal amount of and the accrued interest on all of the Debentures shall become immediately due and payable; provided that the payment of principal and interest on such Debentures shall remain subordinated to the extent provided in the Indenture. At any time after such a declaration of acceleration with respect to the Debentures has been made and before a judgment or decree for payment of the money due has been obtained by the Debenture Trustee as provided in the Indenture, the Holders of a majority in Liquidation Amount of the Capital Securities, by written notice to the Property Trustee, the Depositor and the Debenture Trustee, may rescind and annul such declaration and its consequences if: (i) the Depositor has paid or deposited with the Debenture Trustee a sum sufficient to pay (A) all overdue installments of interest (including any Additional Interest, as defined in the Indenture) on all of the Debentures, 29 (B) the principal of (and premium, if any, on) any Debentures that have become due otherwise than by such declaration of acceleration and interest thereon at the rate borne by the Debentures, and (C) ___ all sums paid or advanced by the Debenture Trustee under the Indenture and the reasonable compensation, expenses, disbursements and advances of the Debenture Trustee and the Property Trustee, their agents and counsel and all amounts payable to the Debenture Trustee under Section 7.06 of the Indenture; and (ii) all Debenture Events of Default, other than the non-payment of the principal of the Debentures that has become due solely by such acceleration, have been cured or waived as provided in Article Six of the Indenture. The holders of a majority in aggregate Liquidation Amount of the Capital Securities may, on behalf of the Holders of all the Capital Securities, waive any past default under the Indenture, except a default in the payment of principal or interest (unless such default has been cured and a sum sufficient to pay all matured installments of interest and principal due otherwise than by acceleration has been deposited with the Debenture Trustee) or a default in respect of a covenant or provision that under the Indenture cannot be modified or amended without the consent of the holder of each outstanding Debenture. No such rescission shall affect any subsequent default or impair any right consequent thereon. Upon receipt by the Property Trustee of written notice declaring such an acceleration, or rescission and annulment thereof, by Holders of the Capital Securities all or part of which are represented by Global Capital Securities Certificates, a record date shall be established for determining Holders of Outstanding Capital Securities entitled to join in such notice, which record date shall be at the close of business on the day the Property Trustee receives such notice. The Holders on such record date, or their duly designated proxies, and only such Persons, shall be entitled to join in such notice, whether or not such Holders remain Holders after such record date; provided, that, unless such declaration of acceleration, or rescission and annulment, as the case may be, has become effective by virtue of the requisite percentage having joined in such notice prior to the day that is 90 days after such record date, such notice of declaration of acceleration, or rescission and annulment, as the case may be, shall automatically and without further action by any Holder be canceled and of no further effect. Nothing in this paragraph shall prevent a Holder, or a proxy of a Holder, from giving, after expiration of such 90-day period, a new written notice of declaration of acceleration, or rescission and annulment thereof, as the case may be, that is identical to a written notice that has been canceled pursuant to the proviso to the preceding sentence, in which event a new record date shall be established pursuant to the provisions of this SECTION 5.14(b). (c) For so long as any Capital Securities remain Outstanding, to the fullest extent permitted by law and subject to the terms of this Trust Agreement and the Indenture, upon a Debenture Event of Default specified in Section 6.01(a) or 6.01(b) of the Indenture, any Holder of Capital Securities shall have the right to institute a proceeding directly against the Depositor, pursuant to Article Six of the Indenture, for enforcement of payment to such Holder of the principal amount of or interest on Debentures having a 30 principal amount equal to the Liquidation Amount of the Capital Securities of such Holder (a "DIRECT ACTION"). Except as set forth in SECTION 5.14(b) and this SECTION 5.14(c), the Holders of Capital Securities shall have no right to exercise directly any right or remedy available to the holders of, or in respect of, the Debentures. The Holders of a majority in Liquidation Amount of the Capital Securities at the time Outstanding shall have the right to direct the time, method, and place of conducting any proceeding for any remedy available to the Property Trustee, or exercising any trust or power conferred on the Property Trustee with respect to such Capital Securities; provided, however, that the Property Trustee shall have the right to decline to follow any such direction if the Property Trustee being advised by an Opinion of Counsel determines that the action so directed may not lawfully be taken, or if the Property Trustee in good faith determines that the proceedings so directed would be illegal or involve it in personal liability or be unduly prejudicial to the rights of Holders of Capital Securities not parties to such direction, and provided further that nothing in the Trust Agreement shall impair the right of the Property Trustee to take any action deemed proper by the Property Trustee and which is not inconsistent with such direction by such Securityholders. ARTICLE VI ACTS OF SECURITYHOLDERS; MEETINGS; VOTING ----------------------------------------- Section 6.1. Limitations on Voting Rights. (a) Except as provided in this ---------------------------- Section, in SECTIONS 5.14, 8.10 and 10.2 and in the Indenture and as otherwise required by law, no Holder of Capital Securities shall have any right to vote or in any manner otherwise control the administration, operation and management of the Trust or the obligations of the parties hereto, nor shall anything herein set forth, or contained in the terms of the Trust Securities Certificates, be construed so as to constitute the Securityholders from time to time as partners or members of an association. (b) So long as any Debentures are held by the Property Trustee, the Trustees shall not (i) direct the time, method and place of conducting any proceeding for any remedy available to the Debenture Trustee, or executing any trust or power conferred on the Debenture Trustee with respect to such Debentures, (ii) waive any past default that is waivable under the Indenture, (iii) exercise any right to rescind or annul a declaration that the principal of all the Debentures shall be due and payable or (iv) consent to any amendment, modification or termination of the Indenture or the Debentures, where the consent of the holders of Debentures shall be required, without, in each case, obtaining the prior approval of the Holders of at least a majority in Liquidation Amount of all Outstanding Capital Securities; provided, however, that where a consent under the Indenture would require the consent of each holder of Debentures affected thereby, no such consent shall be given by the Property Trustee without the prior written consent of each Holder of Capital Securities. The Trustees shall not revoke any action previously authorized or approved by a vote of the Holders of Capital Securities, except by a subsequent vote of the Holders of Capital Securities. Subject to SECTION 8.3, the Property Trustee shall notify all Holders of the Capital Securities of any notice of default received from the Debenture Trustee with respect to the Debentures. In addition to obtaining the foregoing approvals of the Holders of the Capital Securities, prior to taking any of the foregoing actions, the Trustees shall, at 31 the expense of the Depositor, obtain an Opinion of Counsel to the effect that such action shall not cause the Trust to fail or cease to be classified as a grantor trust for United States Federal income tax purposes. (c) If any proposed amendment to this Trust Agreement provides for, or the Trustees otherwise propose to effect, (i) any action that would adversely affect in any material respect the powers, preferences or special rights of the Capital Securities, whether by way of amendment to this Trust Agreement or otherwise, or (ii) the dissolution, winding-up or termination of the Trust, other than pursuant to the terms of this Trust Agreement, then the Holders of Outstanding Capital Securities as a class will be entitled to vote on such amendment or proposal and such amendment or proposal shall not be effective except with the approval of the Holders of a majority in Liquidation Amount of the Outstanding Capital Securities, except as otherwise provided in SECTION 10.2(c). Notwithstanding any other provision of this Trust Agreement, no amendment to this Trust Agreement may be made if, as a result of such amendment, it would cause the Trust to fail or cease to be classified as a grantor trust for United States Federal income tax purposes. Section 6.2. Notice of Meetings. Notice of all meetings of the Capital ------------------ Securityholders, stating the time, place and purpose of the meeting, shall be given by the Property Trustee pursuant to SECTION 10.8 to each Capital Securityholder of record, at his or her registered address, at least 15 days and not more than 90 days before the meeting. At any such meeting, any business properly before the meeting may be so considered whether or not stated in the notice of the meeting. Any adjourned meeting may be held as adjourned without further notice. Section 6.3. Meetings of Capital Securityholders. No annual meeting of ----------------------------------- Securityholders is required to be held. The Administrative Trustees, however, shall call a meeting of Capital Securityholders to vote on any matter upon the written request of the Holders of Capital Securities of record of at least 25% of the Capital Securities (based upon their Liquidation Amount) and the Administrative Trustees or the Property Trustee may, at any time in their discretion, call a meeting of Capital Securities to vote on any matters as to which Holder of Capital Securities are entitled to vote. Holders of Capital Securities of record of at least 50% of the Outstanding Capital Securities (based upon their Liquidation Amount), present in person or by proxy, shall constitute a quorum at any meeting of Holders of Capital Securities. If a quorum is present at a meeting, an affirmative vote by the Holders of Capital Securities of record present, in person or by proxy, holding more than a majority of the Capital Securities (based upon their Liquidation Amount) held by the Holders of Capital Securities of record present, either in person or by proxy, at such meeting shall constitute the action of the Holders of Capital Securities, unless this Trust Agreement requires a greater number of affirmative votes. Section 6.4. Voting Rights. Securityholders shall be entitled to one vote ------------- for each $1,000 of Liquidation Amount represented by their Trust Securities in respect of any matter as to which such Securityholders are entitled to vote. 32 Section 6.5. Proxies, etc. At any meeting of Securityholders, any ------------- Securityholder entitled to vote thereat may vote by proxy; provided that no proxy shall be voted at any meeting unless it has been placed on file with the Administrative Trustees, or with such other officer or agent of the Trust as the Administrative Trustees may direct, for verification prior to the time at which such vote shall be taken. Pursuant to a resolution of the Property Trustee, proxies may be solicited in the name of the Property Trustee or one or more officers of the Property Trustee. Only Securityholders of record shall be entitled to vote. When Trust Securities are held jointly by several Persons, any one of them may vote at any meeting in person or by proxy in respect of such Trust Securities, but if more than one of them shall be present at such meeting in person or by proxy, and such joint owners or their proxies so present disagree as to any vote to be cast, such vote shall not be received in respect of such Trust Securities. A proxy purporting to be executed by or on behalf of a Securityholder shall be deemed valid unless challenged at or prior to its exercise, and the burden of proving invalidity shall rest on the challenger. No proxy shall be valid more than three years after its date of execution. Section 6.6. Securityholder Action by Written Consent. Any action that may ---------------------------------------- be taken by Securityholders at a meeting may be taken without a meeting if Securityholders holding a majority of all Outstanding Trust Securities (based upon their Liquidation Amount) entitled to vote in respect of such action (or such larger proportion thereof as shall be required by any express provision of this Trust Agreement) consent to the action in writing. Section 6.7. Record Date for Voting and Other Purposes. For the purposes ----------------------------------------- of determining the Securityholders who are entitled to notice of and to vote at any meeting or by written consent, or to participate in any Distribution on the Trust Securities in respect of which a record date is not otherwise provided for in this Trust Agreement, or for the purpose of any other action, the Administrative Trustees may from time to time fix a date, not more than 90 days prior to the date of any meeting of Securityholders or the payment of a Distribution or other action, as the case may be, as a record date for the determination of the identity of the Securityholders of record for such purposes. Section 6.8. Acts of Securityholders. Any request, demand, authorization, ----------------------- direction, notice, consent, waiver or other action provided or permitted by this Trust Agreement to be given, made or taken by Securityholders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Securityholders in person or by an agent duly appointed in writing; and, except as otherwise expressly provided herein, such action shall become effective when such instrument or instruments are delivered to an Administrative Trustee. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the "ACT" of the Securityholders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Trust Agreement and (subject to SECTION 8.2) conclusive in favor of the Trustees, if made in the manner provided in this Section. The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him the execution thereof. Where such execution is by a signer acting in a capacity other than his individual capacity, such 33 certificate or affidavit shall also constitute sufficient proof of his authority. The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner that any Trustee receiving the same deems sufficient. The ownership of Capital Securities shall be proved by the Securities Register. Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Securityholder of any Trust Security shall bind every future Securityholder of the same Trust Security and the Securityholder of every Trust Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustees or the Trust in reliance thereon, whether or not notation of such action is made upon such Trust Security. Without limiting the foregoing, a Securityholder entitled hereunder to take any action hereunder with regard to any particular Trust Security may do so with regard to all or any part of the Liquidation Amount of such Trust Security or by one or more duly appointed agents each of which may do so pursuant to such appointment with regard to all or any part of such Liquidation Amount. If any dispute arises between the Securityholders and the Administrative Trustees or among such Securityholders or Trustees with respect to the authenticity, validity or binding nature of any request, demand, authorization, direction, consent, waiver or other Act of such Securityholder or Trustee under this Article VI, then the determination of such matter by the Property Trustee shall be conclusive with respect to such matter. Section 6.9. Inspection of Records. Upon reasonable notice to the --------------------- Administrative Trustees and the Property Trustee, the records of the Trust shall be open to inspection by Securityholders during normal business hours for any purpose reasonably related to such Securityholder's interest as a Securityholder. ARTICLE VII REPRESENTATIONS AND WARRANTIES ------------------------------ Section 7.1. Representations and Warranties of the Bank, the Property -------------------------------------------------------- Trustee and the Delaware Trustee. The initial Property Trustee and the initial - -------------------------------- Delaware Trustee, each severally on behalf of and as to itself, hereby represents and warrants for the benefit of the Depositor and the Securityholders that: (a) the Property Trustee is a New York banking corporation; (b) the Property Trustee has full corporate power, authority and legal right to execute, deliver and perform its obligations under this Trust Agreement and has taken all necessary action to authorize the execution, delivery and performance by it of this Trust Agreement; 34 (c) the Delaware Trustee is a Delaware banking corporation duly organized, validly existing and in good standing with its principal place of business in the State of Delaware; (d) the Delaware Trustee has full corporate power, authority and legal right to execute, deliver and perform its obligations under this Trust Agreement and has taken all necessary action to authorize the execution, delivery and performance by it of this Trust Agreement; (e) this Trust Agreement has been duly authorized, executed and delivered by the Property Trustee and the Delaware Trustee and constitutes the valid and legally binding agreement of each of the Property Trustee and the Delaware Trustee enforceable against each of them in accordance with its terms; (f) the execution, delivery and performance of this Trust Agreement have been duly authorized by all necessary corporate or other action on the part of the Property Trustee and the Delaware Trustee and do not require any approval of stockholders of the Property Trustee and the Delaware Trustee and such execution, delivery and performance will not (i) violate the charter or By-laws of the Property Trustee or the Delaware Trustee, (ii) violate any provision of, or constitute, with or without notice or lapse of time, a default under, or result in the creation or imposition of, any Lien on any properties included in the Trust Property pursuant to the provisions of, any indenture, mortgage, credit agreement, license or other agreement or instrument to which the Property Trustee or the Delaware Trustee is a party or by which it is bound, or (iii) violate any law, governmental rule or regulation of the United States, the State of New York or the State of Delaware, as the case may be, governing the banking, trust or general powers of the Property Trustee or the Delaware Trustee (as appropriate in context) or any order, judgment or decree applicable to the Property Trustee or the Delaware Trustee; (g) neither the authorization, execution or delivery by the Property Trustee or the Delaware Trustee of this Trust Agreement nor the consummation of any of the transactions by the Property Trustee or the Delaware Trustee (as appropriate in context) contemplated herein requires the consent or approval of, the giving of notice to, the registration with or the taking of any other action with respect to any governmental authority or agency under any existing State of New York or State of Delaware law governing the banking, trust or general powers of the Property Trustee or the Delaware Trustee, as the case may be; and (h) there are no proceedings pending or, to the best of each of the Property Trustee's and the Delaware Trustee's knowledge, threatened against or affecting the Property Trustee or the Delaware Trustee in any court or before any governmental authority, agency or arbitration board or tribunal that, individually or in the aggregate, would materially and adversely affect the Trust or would question the right, power and authority of the Property Trustee or the Delaware Trustee, as the case may be, to enter into or perform its obligations as one of the Trustees under this Trust Agreement. Any successor Property Trustee and Delaware Trustee shall make similar representations and warranties as contained in this SECTION 7.1 for the benefit of the Depositor and the Securityholders. 35 Section 7.2. Representations and Warranties of Depositor. The Depositor ------------------------------------------- hereby represents and warrants for the benefit of the Securityholders that: (a) the Trust Securities Certificates issued at any Closing Date on behalf of the Trust have been duly authorized and will have been duly and validly executed, issued and delivered by the Trustees pursuant to the terms and provisions of, and in accordance with the requirements of, this Trust Agreement and the Securityholders will be, as of each such date, entitled to the benefits of this Trust Agreement; and (b) there are no taxes, fees or other governmental charges payable by the Trust (or the Trustees on behalf of the Trust) under the laws of the State of Delaware or any political subdivision thereof in connection with the execution, delivery and performance by the Property Trustee or the Delaware Trustee, as the case may be, of this Trust Agreement. ARTICLE VIII THE TRUSTEES ------------ Section 8.1. Corporate Property Trustee Required; Eligibility of Trustees. ------------------------------------------------------------ (a) There shall at all times be a Property Trustee hereunder with respect to the Trust Securities. The Property Trustee shall be a Person that is eligible pursuant to the Trust Indenture Act to act as such and has a combined capital and surplus of at least $50,000,000. If any such Person publishes reports of condition at least annually, pursuant to law or the requirements of its supervising or examining authority, then, for the purposes of this SECTION 8.1(a), the combined capital and surplus of such Person shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Property Trustee with respect to the Trust Securities ceases to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect hereinafter specified in this Article. (b) There shall at all times be one or more Administrative Trustees hereunder with respect to the Trust Securities. Each Administrative Trustee shall be either a natural person who is at least 21 years of age or a legal entity that shall act through one or more persons authorized to bind that entity. No natural person shall be eligible to act as an Administrative Trustee hereunder unless such person is an employee or officer of, or affiliated with, the Depositor. (c) There shall at all times be a Delaware Trustee with respect to the Trust Securities. The Delaware Trustee shall either be (i) a natural person who is at least 21 years of age and a resident of the State of Delaware or (ii) a legal entity with its principal place of business in the State of Delaware and that otherwise meets the requirements of applicable Delaware law that shall act through one or more persons authorized to bind such entity. Section 8.2. Certain Duties and Responsibilities. (a) The duties and ----------------------------------- responsibilities of the Trustees shall be restricted to those set forth in the express provisions of this Trust Agreement and, in the case of the Property Trustee, as provided in the Trust Indenture Act in respect of an indenture 36 trustee under that Act, and no implied covenants or obligations shall be read into this Trust Agreement against the Property Trustee. For purposes of Sections 315(a) and 315(c) of the Trust Indenture Act, the term "default" is hereby an "Event of Default" which has occurred and is continuing. Notwithstanding the foregoing, no provision of this Trust Agreement shall require any of the Trustees to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. Notwithstanding anything contained in this Trust Agreement to the contrary, the duties and responsibilities of the Property Trustee under this Trust Agreement shall subject to the protections, exculpations and limitations on liability afforded to the Property Trustee under this Trust Agreement, the Delaware Business Trust Act, to the extent applicable, Rule 3a-7 under the Investment Company Act or any successor rule thereunder, and to an indenture trustee under the Trust Indenture Act. For the purposes of Section 315(d)(2) of the Trust Indenture Act, the term "responsible officer" is hereby defined as "Responsible Officer". Whether or not therein expressly so provided, every provision of this Trust Agreement relating to the conduct or affecting the liability of or affording protection to the Trustees shall be subject to the provisions of this Section. Nothing in this Trust Agreement shall be construed to release an Administrative Trustee from liability for his or her or its own negligence or willful misconduct. To the extent that, at law or in equity, an Administrative Trustee or the Delaware Trustee has duties (including fiduciary duties) and liabilities relating thereto to the Trust, to any other Trustee or to the Securityholders, such Administrative Trustee or the Delaware Trustee shall not be liable to the Trust, to any other Trustee or to any Securityholder for such Trustee's good faith reliance on the provisions of this Trust Agreement. The provisions of this Trust Agreement, to the extent that they restrict the duties and liabilities of the Administrative Trustees otherwise existing at law or in equity, are agreed by the Depositor, the Trustees and the Securityholders to replace such other duties and liabilities of the Administrative Trustees and the Delaware Trustee. (b) All payments made by the Property Trustee or a Paying Agent in respect of the Trust Securities shall be made only from the revenue and proceeds from the Trust Property and only to the extent that there is sufficient revenue or proceeds from the Trust Property to enable the Property Trustee or a Paying Agent to make payments in accordance with the terms hereof. Each Securityholder, by its acceptance of a Trust Security, agrees that it will look solely to the revenue and proceeds from the Trust Property to the extent legally available for distribution to it as herein provided and that the Trustees are not personally liable to it for any amount distributable in respect of any Trust Security or for any other liability in respect of any Trust Security. This Section 8.2(b) does not limit the liability of the Trustees expressly set forth elsewhere in this Trust Agreement or, in the case of the Property Trustee, in the Trust Indenture Act. (c) No provision of this Trust Agreement shall be construed to relieve the Property Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that: (i) Except during the continuance of an Event of Default: (1) the Property Trustee undertakes to perform such duties and only such duties as are specifically set forth in 37 this Trust Agreement and no implied covenants or obligations shall be read into this Trust Agreement against the Property Trustee; and (2) in the absence of bad faith on its part, the Property Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Property Trustee and conforming to the requirements of this Trust Agreement; but in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Property Trustee, the Property Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Trust Agreement. (ii) the Property Trustee shall not be liable for any error of judgment made in good faith by an authorized officer of the Property Trustee, unless it is proved that the Property Trustee was negligent in ascertaining the pertinent facts upon which such judgment was made; (iii) Property Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of not less than a majority in Liquidation Amount of the Trust Securities relating to the time, method and place of conducting any proceeding for any remedy available to the Property Trustee, or exercising any trust or power conferred upon the Property Trustee under this Trust Agreement; (iv) no provision of this Trust Agreement shall require the Property Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. (v) Property Trustee's sole duty with respect to the custody, safe keeping and physical preservation of the Debentures and the Payment Account shall be to deal with such property in a similar manner as the Property Trustee deals with similar property for its own account, subject to the protections and limitations on liability afforded to the Property Trustee under this Trust Agreement, the Delaware Business Trust Act and the Trust Indenture Act; (vi) Property Trustee shall not be liable for any interest on any money received by it except as it may otherwise agree in writing with the Depositor; and money held by the Property Trustee need not be segregated from other funds held by it except in relation to the Payment Account maintained by the Property Trustee pursuant to Section 3.1 and except to the extent otherwise required by law; and (vii) Property Trustee shall not be responsible for monitoring the compliance by the Administrative Trustees or the Depositor with 38 their respective duties under this Trust Agreement, nor shall the Property Trustee be liable for the default or misconduct of the Administrative Trustees or the Depositor. Section 8.3. Certain Notices. Within 90 days after the occurrence of any --------------- Event of Default actually known to a Responsible Officer of the Property Trustee assigned to its Corporate Trust Office, the Property Trustee shall transmit, in the manner and to the extent provided in SECTION 10.8, notice of such Event of Default to the Securityholders, the Administrative Trustees and the Depositor, unless such Event of Default has been cured or waived. Within five Business Days after the receipt of notice of the Depositor's exercise of its right to defer the payment of interest on the Debentures pursuant to the Indenture, the Administrative Trustee shall transmit, in the manner and to the extent provided in Section 10.8, notice of such exercise to the Securityholders and the Property Trustee, unless such exercise has been revoked. Section 8.4. Certain Rights of Property Trustee. Subject to the provisions ---------------------------------- of SECTION 8.2: (a) the Property Trustee may conclusively rely and shall be fully protected in acting or refraining from acting upon any resolution, opinion, certificate, written representation of a Holder or transferee, certificate of auditors or any other certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, appraisal, bond, debenture, note, other evidence of indebtedness or other paper or document reasonably believed by it to be genuine and to have been signed, sent or presented by the proper party or parties; (b) if (i) in performing its duties under this Trust Agreement the Property Trustee is required to decide between alternative courses of action or (ii) in construing any of the provisions of this Trust Agreement the Property Trustee finds the same ambiguous or inconsistent with any other provisions contained herein or (iii) the Property Trustee is unsure of the application of any provision of this Trust Agreement, then, except as to any matter as to which the Holders of Capital Securities are entitled to vote under the terms of this Trust Agreement, the Property Trustee shall deliver a notice to the Depositor requesting written instructions of the Depositor as to the course of action to be taken and the Property Trustee shall take such action, or refrain from taking such action, as the Property Trustee is instructed in writing to take, or to refrain from taking, by the Depositor; provided, however, that if the Property Trustee does not receive such instructions of the Depositor within ten Business Days after it has delivered such notice, or such reasonably shorter period of time set forth in such notice (which to the extent practicable shall not be less than two Business Days), it may, but shall be under no duty to, take or refrain from taking such action not inconsistent with this Trust Agreement as it deems advisable and in the best interests of the Securityholders, in which event the Property Trustee shall have no liability except for its own bad faith, negligence or willful misconduct; (c) any direction or act of the Depositor or the Administrative Trustees contemplated by this Trust Agreement shall be sufficiently evidenced by an Officers' Certificate or an instrument signed by the requisite number of Administrative Trustees, as the case may be; 39 (d) whenever in the administration of this Trust Agreement, the Property Trustee deems it desirable that a matter be proved or established before taking, suffering or omitting to take any action hereunder, the Property Trustee (unless other evidence is herein specifically prescribed) may, in the absence of bad faith on its part, request and conclusively rely upon an Officers' Certificate which, upon receipt of such request, shall be promptly delivered by the Depositor or the Administrative Trustees; (e) the Property Trustee shall have no duty to see to any recording, filing or registration of any instrument (including any financing or continuation statement or any filing under tax or securities laws) or any re-recording, refiling or reregistration thereof; (f) the Property Trustee may consult with counsel of its selection (which counsel may be counsel to the Depositor or any of its Affiliates, and may include any of its employees) and the advice or opinion of such counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted to be taken by it hereunder in good faith and in reliance thereon; the Property Trustee shall have the right at any time to seek instructions concerning the administration of the Trust or interpretation of this Trust Agreement from any court of competent jurisdiction; (g) the Property Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Trust Agreement at the request or direction of any of the Securityholders pursuant to this Trust Agreement, unless such Securityholders have offered to the Property Trustee such adequate security or indemnity against the costs, expenses (including attorney's fees and expenses) and liabilities that might be incurred by it in complying with such request or direction, including such reasonable advances as may be requested by the Property Trustee; (h) the Property Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, approval, bond, debenture, note or other evidence of indebtedness or other paper or document, but the Property Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit; (i) the Property Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Property Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder; (j) whenever in the administration of this Trust Agreement the Property Trustee deems it desirable to receive instructions with respect to enforcing any remedy or right or taking any other action hereunder, the Property Trustee (i) may request instructions from the Holders of the Trust Securities which instructions may only be given by the Holders of the same proportion in Liquidation Amount of the Trust Securities as would be entitled to direct the Property Trustee under the terms of the Trust Securities in respect of such remedy, right or action, (ii) may refrain from enforcing such remedy or right or taking such other action until such instructions are received, and (iii) shall be protected in acting in accordance with such instructions; 40 (k) except as otherwise expressly provided by this Trust Agreement, the Property Trustee shall not be under any obligation to take any action that is discretionary under the provisions of this Trust Agreement; (l) the Property Trustee shall not be charged with knowledge of an Event of Default unless either (i) a Responsible Officer of the Property Trustee assigned to its Corporate Trust Department (or any successor department or division of the Property Trustee) located at the Corporate Trust Office shall have actual knowledge of such Event of Default or (ii) the Property Trustee receives at the Corporate Trust Office written notice of such event from the Depositor, any other Trustee or Securityholders holding a majority or more of Capital Securities (based upon Liquidation Amount) and such notice references the Trust Securities and this Trust Agreement; (m) no provision of this Trust Agreement shall be deemed to impose any duty or obligation on the Property Trustee to perform any act or acts or exercise any right, power, duty or obligation conferred or imposed on it, in any jurisdiction in which it is illegal, or in which the Property Trustee is unqualified or incompetent in accordance with applicable law, to perform any such act or acts, or to exercise any such right, power, duty or obligation; (n) no permissive or discretionary power or authority available to the Property Trustee shall be construed to be a duty to act in accordance with such power and authority; (o) the Property Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Trust Agreement at the request of direction of any of the Securityholders pursuant to this Trust Agreement, unless such Securityholders shall have offered the Property Trustee reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction; (p) the Property Trustee shall have no duty to see to any recording, filing or registration of any instrument (including any financing or continuation statement or any tax or securities) (or any re-recording, refiling or registration thereof); (q) the Property Trustee shall have the right at any time to seek instructions concerning the administration of this Trust Agreement from any court of competent jurisdiction; (r) whenever in the administration of this Trust Agreement the Property Trustee shall deem it desirable to receive instructions with respect to enforcing any remedies or right or taking any other action hereunder, the Property Trustee (i) may request instructions from the Holders of the Trust Securities, which instructions may only be given by the Holders of the same Liquidation Amount of Trust Securities as would be entitled to direct the Property Trustee under the terms of this Trust Agreement in respect of such remedies, right or action, (ii) may refrain from enforcing such remedy or right or taking such other action until such instructions are received, and (iii) shall be fully protected in acting in accordance with such instructions; (s) the rights, privileges, protections, immunities, and benefits given to the Property Trustee, including, without limitation, its right to be indemnified , are extended to, and shall be enforceable by, the Property Trustee in each of its capacities hereunder, and to each agent, custodian and other Person employed to act hereunder; 41 (t) the Property Trustee shall not be liable for any action taken, suffered, or omitted to be taken by it in good faith and reasonably believed by it to be authorized or within the discretion or rights or powers conferred upon by this Trust Agreement; and (u) the Property Trustee may request that the Depositor deliver an Officers' Certificate setting forth the names of officers authorized at such time to take specified actions pursuant to this Trust Agreement, which Officers' Certificate may be signed by any person authorized to sign an Officers' Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded. Section 8.5. Not Responsible for Recitals or Issuance of Trust Securities. ------------------------------------------------------------ The recitals contained herein and in the Trust Securities Certificates shall be taken as the statements of the Trust, and the Trustees do not assume any responsibility for their correctness. The Trustees make no representations and shall have no duty or liability for, or with respect to, the validity or sufficiency of this Trust Agreement or of the Trust Securities, the value, genuineness, existence or sufficiency of the Trust Property or the payment of any taxes or assessments levied thereon or in connection therewith. The Trustees shall not be accountable for the use or application by the Depositor of the proceeds of the Debentures. Section 8.6. May Hold Securities. Any Trustee or any other agent of any ------------------- Trustee or the Trust, in its individual or any other capacity, may become the owner or pledgee of Trust Securities and, subject to SECTIONS 8.8 and 8.13 and except as provided in the definition of the term "OUTSTANDING" in Article I, may otherwise deal with the Trust with the same rights it would have if it were not a Trustee or such other agent. Section 8.7. Compensation; Indemnity; Fees. The Depositor agrees: ----------------------------- (a) to pay to the Trustees from time to time such compensation as shall be agreed in writing between the Depositor and the respective Trustees for all services rendered by them hereunder (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust); (b) except as otherwise expressly provided herein, to reimburse the Trustees upon request for all reasonable expenses, disbursements and advances incurred or made by the Trustees in accordance with any provision of this Trust Agreement (including the reasonable compensation and the expenses and disbursements of their agents and counsel), except any such expense, disbursement or advance as may be attributable to their willful misconduct or negligence; (c) to the fullest extent permitted by applicable law, to indemnify and hold harmless (i) each Trustee, (ii) any Affiliate of any Trustee, (iii) any officer, director, shareholder, employee, representative or agent of any Trustee, and (iv) any employee or agent of the Trust or its Affiliates (referred to herein as an "INDEMNIFIED PERSON") from and against any loss, damage, liability, tax, penalty, expense or claim of any kind or nature whatsoever incurred by such Indemnified Person by reason of the creation, 42 operation or termination of the Trust or any act or omission performed or omitted by such Indemnified Person on behalf of the Trust and in a manner such Indemnified Person reasonably believed to be within the scope of authority conferred on such Indemnified Person by this Trust Agreement, except that no Indemnified Person shall be entitled to be indemnified in respect of any loss, damage or claim incurred by such Indemnified Person by reason of negligence or willful misconduct with respect to such acts or omissions; and (d) to the fullest extent permitted by applicable law, to advance expenses (including legal fees and expenses) incurred by an Indemnified Person in defending any claim, demand, action, suit or proceeding which expenses shall be advanced, from time to time, prior to the final disposition of such claim, demand, action, suit or proceeding upon receipt by the Depositor of (i) a written affirmation by or on behalf of the Indemnified Person of its, his or her good faith belief that it he or she has met the standard of conduct set forth in this Section 8.7 and (ii) an undertaking by or on behalf of the Indemnified Person to repay such amount if it becomes determined that the Indemnified Person is not entitled to be indemnified as authorized in the preceding subsection. "Trustee" for the purpose of this Section shall include any predecessor Trustee; provided, however, that the negligence, willful misconduct or bad faith of any Trustee hereunder shall not affect the rights of any other Trustee hereunder. In addition to the rights provided to each Trustee herein and not by way of prejudice, when a Trustee incurs expenses or renders services in connection with an Event of Default resulting from a Bankruptcy Event with respect to the Trust, the expenses (including reasonable charges and expenses of its counsel) and the compensation for the services are intended to constitute expenses of administration under any applicable Federal or State bankruptcy, insolvency or other similar law. The provisions of this SECTION 8.7 shall survive the termination of this Trust Agreement and the resignation or removal of any Trustee. As security for the performance of the obligations of the Depositor under this Section, each of the Trustees shall have a lien prior to the Trust Securities upon all property and funds held or collected by such Trustee as such, except funds held in trust for the payment of Distributions on, or any other payments in respect of, particular Trust Securities. The Depositor and any Trustee (in the case of the Property Trustee, subject to SECTION 8.8 hereof) may engage in or possess an interest in other business ventures of any nature or description, independently or with others, similar or dissimilar to the business of the Trust, and the Trust and the Holders of Trust Securities shall have no rights by virtue of this Trust Agreement in and to such independent ventures or the income or profits derived therefrom, and the pursuit of any such venture, even if competitive with the business of the Trust, shall not be deemed wrongful or improper. Neither the Depositor, nor any Trustee, shall be obligated to present any particular investment or other opportunity to the Trust even if such opportunity is of a character that, if presented to the Trust, could be taken by the Trust, and the Depositor or any Trustee shall have the right to take for its own account (individually or as a partner or fiduciary) or to recommend to others any such particular investment or other opportunity. Any Trustee may engage or be interested in any financial or other 43 transaction with the Depositor or any Affiliate of the Depositor, or may act as depository for, trustee or agent for, or act on any committee or body of holders of, securities or other obligations of the Depositor or its Affiliates. Section 8.8. Conflicting Interests. If the Property Trustee has or --------------------- acquires a conflicting interest within the meaning of the Trust Indenture Act, the Property Trustee shall either eliminate such interest or resign, to the extent and in the manner provided by, and subject to the provisions of, the Trust Indenture Act and this Trust Agreement. The Indenture and the Guarantee Agreement shall be deemed to be specifically described in this Trust Agreement for the purposes of clause (i) of the first proviso contained in Section 310(b) of the Trust Indenture Act. Section 8.9. Co-Trustees and Separate Trustee. Unless an Event of Default -------------------------------- has occurred and is continuing, at any time or times, for the purpose of conforming to the legal requirements of the Trust Indenture Act or of any jurisdiction in which any part of the Trust Property may at the time be located, the Depositor and the Administrative Trustees, except in such instances as set forth in the following sentence, by agreed action of the majority of such Trustees, shall have power to appoint, and upon the written request of the Administrative Trustees, the Depositor shall for such purpose join with the Administrative Trustees in the execution, delivery, and performance of all instruments and agreements necessary or proper to appoint, one or more Persons approved by the Property Trustee either to act as co-trustee, jointly with the Property Trustee, of all or any part of such Trust Property, or to the extent required by law to act as separate trustee of any such property, in either case with such powers as may be provided in the instrument of appointment, and to vest in such Person or Persons in the capacity aforesaid, any property, title, right or power deemed necessary or desirable, subject to the other provisions of this Section. If the Depositor does not join in such appointment within 15 days after the receipt by it of a request so to do, or in case a Debenture Event of Default has occurred and is continuing, the Property Trustee alone shall have power to make such appointment. Any co-trustee or separate trustee appointed pursuant to this Section shall either be (i) a natural person who is at least 21 years of age and a resident of the United States or (ii) a legal entity with its principal place of business in the United States that shall act through one or more persons authorized to bind such entity. If any written instrument from the Depositor is required by any co-trustee or separate trustee so appointed for more fully confirming to such co- trustee or separate trustee such property, title, right or power, any and all such instruments shall, on request, be executed, acknowledged and delivered by the Depositor; provided, however, that, if a Debenture Event of Default has occurred and is continuing, the Property Trustee may execute any such instrument on behalf of the Depositor as its agent and attorney-in-fact therefor. Every co-trustee or separate trustee shall, to the extent permitted by law, but to such extent only, be appointed subject to the following terms, namely: (a) The Trust Securities shall be executed and delivered and all rights, powers, duties and obligations hereunder in respect of the custody of securities, cash and other personal property held by, or required to be deposited or pledged with, the Trustees specified hereunder, shall be exercised, solely by such Trustees and not by such co-trustee or separate trustee. 44 (b) The rights, powers, duties and obligations hereby conferred or imposed upon the Property Trustee in respect of any property covered by such appointment shall be conferred or imposed upon and exercised or performed by the Property Trustee or by the Property Trustee and such co-trustee or separate trustee jointly, as shall be provided in the instrument appointing such co-trustee or separate trustee, except to the extent that under any law of any jurisdiction in which any particular act is to be performed, the Property Trustee shall be incompetent or unqualified to perform such act, in which event such rights, powers, duties and obligations shall be exercised and performed by such co- trustee or separate trustee. (c) The Property Trustee at any time, by an instrument in writing executed by it, with the written concurrence of the Depositor, may accept the resignation of or remove any co-trustee or separate trustee appointed under this Section, and, in case a Debenture Event of Default has occurred and is continuing, the Property Trustee shall have power to accept the resignation of, or remove, any such co-trustee or separate trustee without the concurrence of the Depositor. Upon the written request of the Property Trustee, the Depositor shall join with the Property Trustee in the execution, delivery and performance of all instruments and agreements necessary or proper to effectuate such resignation or removal; provided, however, that, if a Debenture Event of Default has occurred and is continuing, the Property Trustee may execute any such instruments or agreements on behalf of the Depositor as its agent and attorney- in-fact therefor. A successor to any co-trustee or separate trustee so resigned or removed may be appointed in the manner provided in this Section. (d) No co-trustee or separate trustee hereunder shall be personally liable by reason of any act or omission of the Property Trustee or any other trustee hereunder. (e) Except as otherwise provided therein, the Property Trustee shall not be liable by reason of any act of a co-trustee or separate trustee. (f) Any Act of Holders delivered to the Property Trustee shall be deemed to have been delivered to each such co-trustee and separate trustee. Section 8.10. Resignation and Removal; Appointment of Successor. No ------------------------------------------------- resignation or removal of any Trustee (the "RELEVANT TRUSTEE") and no appointment of a successor Trustee pursuant to this Article shall become effective until the acceptance of appointment by the successor Trustee in accordance with the applicable requirements of SECTION 8.11. Subject to the immediately preceding paragraph, the Relevant Trustee may resign at any time by giving written notice thereof to the Securityholders and the Depositor. Upon giving such notice, a successor to the Relevant Trustee shall be appointed in accordance with the second succeeding paragraph. If a successor is not so appointed within a reasonable time not to exceed thirty days from the date of the Relevant Trustee's notice of resignation, or if for any reason the instrument of acceptance by the successor Trustee required by Section 8.11 shall not have been delivered to the Relevant Trustee within thirty days after giving of such notice of resignation, the Relevant Trustee may petition, at the expense of the Trust, a court of competent jurisdiction in the State of Delaware to appoint a successor. 45 Unless a Debenture Event of Default has occurred and is continuing, any Trustee may be removed for cause at any time by the Holder of the Common Securities. If a Debenture Event of Default has occurred and is continuing, the Property Trustee and the Delaware Trustee may be removed with or without cause at such time by Holders of a majority in Liquidation Amount of the Outstanding Capital Securities. In no event will the Holders of the Capital Securities have the right to vote to appoint, remove or replace the Administrative Trustees, which voting rights are vested exclusively in the Depositor, as Holder of the Common Securities. After removal by the Holders of a majority in Liquidation Amount of the Capital Securities, the successor to the Relevant Trustee may be appointed in accordance with the next paragraph. If a successor is not so appointed within a reasonable time not to exceed thirty days from the date of the Relevant Trustee's removal, or if for any reason the instrument of acceptance by the successor Trustee required by Section 8.11 has not been delivered to the Relevant Trustee within thirty days of such removal, the Relevant Trustee may petition, at the expense of the Trust, a court of competent jurisdiction in the State of Delaware to appoint a successor. If any Trustee resigns, removed or becomes incapable of acting as Trustee, or if a vacancy occurs in the office of any Trustee for any cause, at a time when no Debenture Event of Default has occurred and is continuing, the Common Securityholder, by Act of the Holder of Common Securities delivered to the retiring Trustee, shall promptly appoint a successor Trustee or Trustees, and the retiring Trustee shall comply with the applicable requirements of SECTION 8.11. If the Property Trustee or the Delaware Trustee resigns, removed or becomes incapable of continuing to act as the Property Trustee or the Delaware Trustee, as the case may be, at a time when a Debenture Event of Default has occurred and is continuing, the Holders of Capital Securities, by Act of the Securityholders of a majority in Liquidation Amount of the Capital Securities then Outstanding delivered to the retiring Relevant Trustee, shall promptly appoint a successor Relevant Trustee or Trustees, and such successor Trustee shall comply with the applicable requirements of SECTION 8.11. If an Administrative Trustee resigns, removed or becomes incapable of acting as Administrative Trustee, the Holders of Common Securities by Act of the Holders of Common Securities delivered to the Administrative Trustee shall promptly appoint a successor Administrative Trustee or Administrative Trustees and such successor Administrative Trustee or Administrative Trustees shall comply with the applicable requirements of SECTION 8.11. If no successor Relevant Trustee has been so appointed by the Holders of Common Securities or the Holders of Capital Securities and accepted appointment in the manner required by SECTION 8.11, any Securityholder who has been a Securityholder of Trust Securities for at least six months may, on behalf of himself or herself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Relevant Trustee. The Property Trustee shall give notice of each resignation and each removal of a Trustee and each appointment of a successor Trustee to all Securityholders in the manner provided in Section 10.8 and shall give notice to the Depositor. Each notice shall include the name of the successor Relevant Trustee and the address of its Corporate Trust Office if it is the Property Trustee. Notwithstanding the foregoing or any other provision of this Trust Agreement, if any Administrative Trustee or a Delaware Trustee who is a natural person dies or becomes, in the opinion of the Depositor, incompetent or 46 incapacitated, the vacancy created by such death, incompetence or incapacity may be filled by (a) the unanimous act of remaining Administrative Trustees if there are at least two of them or (b) otherwise by the Depositor (with the successor in each case being a Person who satisfies the eligibility requirement for Administrative Trustees or Delaware Trustee, as the case may be, set forth in SECTION 8.1). Section 8.11. Acceptance of Appointment by Successor. In case of the -------------------------------------- appointment hereunder of a successor Relevant Trustee, the successor Relevant Trustee shall execute and deliver an amendment hereto wherein such successor Relevant Trustee shall accept such appointment and which shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, each successor Relevant Trustee all the rights, powers, trusts and duties of the retiring Relevant Trustee with respect to the Trust Securities and the Trust, subject to the lien provided for in SECTION 8.7. Upon the execution and delivery of such amendment, the resignation or removal of the Relevant Trustee shall become effective to the extent provided therein and each such successor Relevant Trustee, without any further act, deed or conveyance by any Person, shall become vested with the rights, powers, trusts and duties of the former Relevant Trustee; but, on request of the Trust or any successor Relevant Trustee such former Relevant Trustee shall duly assign, transfer and deliver to such successor Relevant Trustee all Trust Property, all proceeds thereof and money held by such retiring Relevant Trustee hereunder with respect to the Trust Securities and the Trust. Upon request of any such successor Relevant Trustee, the Trust shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Relevant Trustee all such rights, powers and trusts referred to in the first or second preceding paragraph, as the case may be. No successor Relevant Trustee shall accept its appointment unless at the time of such acceptance such successor Relevant Trustee is qualified and eligible under this Article. Section 8.12. Merger, Conversion, Consolidation or Succession to Business. ----------------------------------------------------------- Any Person into which the Property Trustee or the Delaware Trustee may be merged or converted or with which it may be consolidated, or any Person resulting from any merger, conversion or consolidation to which such Relevant Trustee shall be a party, or any Person succeeding to all or substantially all the corporate trust business of such Relevant Trustee, shall be the successor of such Relevant Trustee hereunder; provided such Person shall be otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part of any of the parties hereto. Section 8.13. Preferential Collection of Claims Against Depositor or Trust. ------------------------------------------------------------ In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other similar judicial proceeding relative to the Trust or any other obligor upon the Trust Securities or the property of the Trust or of such other obligor or their creditors, the Property Trustee (irrespective of whether any Distributions or other amounts due on the Trust Securities are then due and payable as therein expressed or by declaration or otherwise and irrespective of whether the 47 Property Trustee has made any demand on the Trust for the payment of any past due Distributions or such other amounts) shall be entitled and empowered, to the fullest extent permitted by law, by intervention in such proceeding or otherwise: (a) to file and prove a claim for the whole amount of any Distributions and other amounts owing and unpaid in respect of the Trust Securities and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Property Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Property Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding, and (b) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Property Trustee and, if the Property Trustee consents to the making of such payments directly to the Holders, to pay to the Property Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Property Trustee, its agents and counsel, and any other amounts due the Property Trustee under SECTION 8.7. Nothing herein contained shall be deemed to authorize the Property Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Trust Securities or the rights of any Holder thereof or to authorize the Property Trustee to vote in respect of the claim of any Holder in any such proceeding. Section 8.14. Reports by Property Trustee. (a) Not later than March 15 of --------------------------- each year commencing March 15, 2002, the Property Trustee shall transmit to all Securityholders in accordance with SECTION 10.8, and to the Depositor, a brief report dated as of the immediately preceding December 31 concerning the Property Trustee and its actions under this Trust Agreement if and as may be required pursuant to Section 313(a) of the Trust Indenture Act. (b) In addition the Property Trustee shall transmit to Securityholders such other reports concerning the Property Trustee and its actions under this Trust Agreement as would be required pursuant to the Trust Indenture Act were this Trust Agreement to be qualified under the Trust Indenture Act at the times and in the manner provided pursuant thereto. (c) A copy of each such report shall, at the time of such transmission to Holders, be filed by the Property Trustee with any interdealer quotation system or self-regulatory organization upon which the Trust Securities are designated for trading, with the Commission and with the Depositor. Section 8.15. Reports to the Property Trustee. The Depositor and the ------------------------------- Administrative Trustees on behalf of the Trust shall provide to the Property Trustee such documents, reports and information as required by Section 314 of the Trust Indenture Act (if any) and the compliance certificate required by Section 314(a)(4) of the Trust Indenture Act in the form, in the manner and at the times required by Section 314 of the Trust Indenture Act, such compliance 48 certificate to be delivered annually on or before March 15 of each year beginning in 2002. Delivery of such reports, information and documents by the Depositor to the Property Trustee is for informational purposes only and the Property Trustee's receipt of such reports, information and documents shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Depositor's compliance with any of its covenants hereunder (as to which the Property Trustee is entitled to rely exclusively on Officers' Certificates.) Section 8.16. Evidence of Compliance with Conditions Precedent. Each of the ------------------------------------------------ Depositor and the Administrative Trustees on behalf of the Trust shall provide to the Property Trustee such evidence of compliance with such conditions precedent, if any, provided for in this Trust Agreement that relate to any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any certificate or opinion required to be given by an officer pursuant to Section 314(c)(1) of the Trust Indenture Act shall be given in the form of an Officers' Certificate. Section 8.17. Number of Trustees. (a) The number of Trustees shall be four; ------------------ provided that the Holder of all of the Common Securities by written instrument may increase or decrease the number of Administrative Trustees and the Property Trustee and the Delaware Trustee may be the same Person. (b) If a Trustee ceases to hold office for any reason and the number of Administrative Trustees is not reduced pursuant to SECTION 8.17(a), or if the number of Trustees is increased pursuant to SECTION 8.17(a), a vacancy shall occur. The vacancy shall be filled with a Trustee appointed in accordance with the provisions of SECTION 8.10 relating to appointment of a successor Trustee upon resignation of a Trustee. (c) The death, resignation, retirement, removal, bankruptcy, incompetence or incapacity to perform the duties of a Trustee shall not operate to dissolve, terminate or annul the Trust. Whenever a vacancy in the number of Administrative Trustees occurs, until such vacancy is filled by the appointment of an Administrative Trustee in accordance with SECTION 8.10, the Administrative Trustees in office, regardless of their number (and notwithstanding any other provision of this Agreement), shall have all the powers granted to the Administrative Trustees and shall discharge all duties imposed upon the Administrative Trustees by this Trust Agreement. Section 8.18. Delegation of Power. (a) Any Administrative Trustee may, by ------------------- power of attorney consistent with applicable law, delegate to any other natural person over the age of 21 his or her power for the purpose of executing any documents contemplated in SECTION 2.7(a) or making any other governmental filing; and (b) The Administrative Trustees shall have power to delegate from time to time to such of their number or to the Depositor the doing of such things and the execution of such instruments either in the name of the Trust or the names of the Administrative Trustees or otherwise as the Administrative Trustees may deem expedient, to the extent such delegation is not prohibited by applicable law or contrary to the provisions of this Trust Agreement, as set forth herein. 49 Section 8.19. Fiduciary Duty. (a) To the extent that, at law or in equity, -------------- an Indemnified Person has duties (including fiduciary duties) and liabilities relating thereto to the Trust or to any other Covered Person, an Indemnified Person acting under this Trust Agreement shall not be liable to the Trust or to any other Covered Person for its good faith reliance on the provisions of this Trust Agreement. The provisions of this Trust Agreement, to the extent that they restrict the duties and liabilities of an Indemnified Person otherwise existing at law or in equity (other than the duties imposed on the Property Trustee under the Trust Indenture Act), are agreed by the parties hereto to replace such other duties and liabilities of such Indemnified Person; (b) Unless otherwise expressly provided herein: (i) whenever a conflict of interest exists or arises between an Indemnified Person and any Covered Person; or (ii) whenever this Trust Agreement or any other agreement contemplated herein or therein provides that an Indemnified Person shall act in a manner that is, or provides terms that are, fair and reasonable to the Trust or any Holder of Trust Securities, the Indemnified Person shall resolve such conflict of interest, take such action or provide such terms, considering in each case the relative interest of each party (including its own interest) to such conflict, agreement, transaction or situation and the benefits and burdens relating to such interests, any customary or accepted industry practices, and any applicable generally accepted accounting practices or principles. In the absence of bad faith by the Indemnified Person, the resolution, action or term so made, taken or provided by the Indemnified Person shall not constitute a breach of this Trust Agreement or any other agreement contemplated herein or of any duty or obligation of the Indemnified Person at law or in equity or otherwise; and (c) Whenever in this Trust Agreement an Indemnified Person is permitted or required to make a decision (i) in its "discretion" or under a grant of similar authority, the Indemnified Person shall be entitled to consider such interests and factors as it desires, including its own interests, and shall have no duty or obligation to give any consideration to any interest of or factors affecting the Trust or any other Person; or (ii) in its "good faith" or under another express standard, the Indemnified Person shall act under such express standard and shall not be subject to any other or different standard imposed by this Trust Agreement or by applicable law. ARTICLE IX TERMINATION, LIQUIDATION AND MERGER ----------------------------------- Section 9.1. Termination Upon Expiration Date. Unless earlier terminated, -------------------------------- the Trust shall automatically terminate on September 1, 2032 (the "EXPIRATION DATE"), following the distribution of the Trust Property in accordance with SECTION 9.4. 50 Section 9.2. Early Termination. The first to occur of any of the following ----------------- events is an "EARLY TERMINATION EVENT": (a) the commencement by the Depositor of a voluntary case under Chapter 7 or Chapter 8 of the federal Bankruptcy Code or any other similar state or federal law now or hereafter in effect, or the consent by the Depositor to the entry of a decree or order for relief in an involuntary case under any such law, or the consent by the Depositor to the appointment of a liquidating agent or committee, conservator or receiver; (b) the entry of a decree or order for relief by a court having jurisdiction in the premises in respect of the Depositor in an involuntary case under Chapter 7 or Chapter 11 of the federal Bankruptcy Code or any other similar state or federal law now or hereafter in effect, and the continuance of any such decree or order unstayed and in effect for a period of 90 days, or the appointment of a liquidating agent or committee, conservator or receiver for the Depositor and the continuance of any such appointment unstayed and in effect for a period of 90 days; (c) the dissolution or liquidation of the Depositor; (d) the written direction to the Property Trustee from the Depositor at any time to dissolve the Trust and distribute Debentures to Securityholders in exchange for the Like Amount of the Trust Securities (which direction is optional and wholly within the discretion of the Depositor), subject to the Depositor having received an Opinion of Counsel to the effect that such distribution will not constitute a taxable exchange of the Capital Securities for United States federal income tax purposes; (e) the redemption of all of the Capital Securities in connection with the redemption or other repayment (at stated maturity or otherwise) of all of the Debentures; and (f) the entry of an order for dissolution of the Trust by a court of competent jurisdiction. Section 9.3. Termination. The respective obligations and responsibilities ----------- of the Trustees and the Trust created and continued hereby shall terminate upon the latest to occur of the following: (a) the distribution by the Property Trustee to Securityholders upon the liquidation of the Trust pursuant to SECTION 9.4, or upon the redemption of all of the Trust Securities pursuant to SECTION 4.2, of all amounts required to be distributed hereunder upon the final payment of the Trust Securities; (b) the payment of any expenses owed by the Trust; and (c) the discharge of all administrative duties of the Administrative Trustees, including the performance of any tax reporting obligations with respect to the Trust or the Securityholders. Section 9.4. Liquidation. (a) If an Early Termination Event specified in ----------- clause (a), (b), (c), (d) or (f) of SECTION 9.2 occurs or upon the Expiration Date, the Trust shall be liquidated by the Trustees as expeditiously as the Trustees determine to be possible by distributing, after satisfaction of liabilities to creditors of the Trust as provided by applicable law, to each Securityholder a Like Amount of Debentures, subject to SECTION 9.4(d). Notice of liquidation shall be given by the Property Trustee by first-class mail, postage prepaid mailed not later than 15 nor more than 60 days prior to the Liquidation Date to each Holder of Trust Securities at such Holder's address appearing in the Securities Register. All notices of liquidation shall: 51 (i) state the Liquidation Date; (ii) state that from and after the Liquidation Date, the Trust Securities will no longer be deemed to be Outstanding and any Trust Securities Certificates not surrendered for exchange will be deemed to represent a Like Amount of Debentures; and (iii) provide such information with respect to the mechanics by which Holders may exchange Trust Securities Certificates for Debentures, or if SECTION 9.4(d) applies, receive a Liquidation Distribution, as the Administrative Trustees or the Property Common Trustee shall deem appropriate. (b) Except where SECTION 9.2(e) or 9.4(d) applies, in order to effect the liquidation of the Trust and distribution of the Debentures to Securityholders, the Property Trustee shall establish a record date for such distribution (which shall be not more than 45 days nor less than 15 days prior to the Liquidation Date) and, either itself acting as exchange agent or through the appointment of a separate exchange agent, shall establish such procedures as it deems appropriate to effect the distribution of Debentures in exchange for the Outstanding Trust Securities Certificates. (c) Except where SECTION 9.2(e) or 9.4(d) applies, after the Liquidation Date, (i) the Trust Securities will no longer be deemed to be Outstanding, (ii) certificates representing a Like Amount of Debentures will be issued to Holders of Trust Securities Certificates, upon surrender of such certificates to the Property Trustee or its agent for exchange, (iii) the Depositor shall use its best efforts to have the Debentures listed on the New York Stock Exchange or on such other exchange, interdealer quotation system or self-regulatory organization as the Capital Securities are then listed, (iv) any Trust Securities Certificates not so surrendered for exchange will be deemed to represent a Like Amount of Debentures, accruing interest at the rate provided for in the Debentures from the last Distribution Date on which a Distribution was made on such Trust Securities Certificates until such certificates are so surrendered (and until such certificates are so surrendered, no payments of interest or principal will be made to Holders of Trust Securities Certificates with respect to such Debentures) and (v) all rights of Securityholders holding Trust Securities will cease, except the right of such Securityholders to receive the Like Amount of Debentures upon surrender of Trust Securities Certificates. (d) In the event that, notwithstanding the other provisions of this SECTION 9.4, whether because of an order for dissolution entered by a court of competent jurisdiction or otherwise, distribution of the Debentures in the manner provided herein is determined by the Property Trustee not to be practicable, the Trust Property shall be liquidated, and the Trust shall be dissolved, wound-up and terminated, by the Property Trustee in such manner as the Property Trustee determines. In such event, on the date of the dissolution of the Trust, Securityholders will be entitled to receive out of the assets of the Trust available for distribution to Securityholders, after satisfaction of liabilities to creditors of the Trust as provided by applicable law, an amount equal to the Liquidation Amount per Trust Security plus accumulated and unpaid Distributions thereon to the date of payment (such amount being the "LIQUIDATION DISTRIBUTION"). If, upon any such dissolution, winding up or termination, the Liquidation Distribution can be paid only in part because the Trust has insufficient assets available to pay in full the aggregate Liquidation Distribution, then, subject to the next succeeding sentence, the 52 amounts payable directly by the Trust on the Trust Securities shall be paid on a pro rata basis (based upon Liquidation Amounts). The Holder of the Common Securities will be entitled to receive Liquidation Distributions upon any such dissolution, winding-up or termination pro rata (determined as aforesaid) with Holders of Capital Securities, except that, if a Debenture Event of Default has occurred and is continuing, the Capital Securities shall have a priority over the Common Securities. Section 9.5. Mergers, Consolidations, Amalgamations or Replacements of the ------------------------------------------------------------- Trust. The Trust may not merge with or into, consolidate, amalgamate, or be - ----- replaced by, or convey, transfer or lease its properties and assets substantially as an entirety to any Person, except pursuant to this Article IX. At the request of the Depositor, with the consent of the Administrative Trustees and without the consent of the Holders of the Capital Securities, the Property Trustee or the Delaware Trustee, the Trust may merge with or into, consolidate, amalgamate, or be replaced by or convey, transfer or lease its properties and assets substantially as an entirety to a trust organized as such under the laws of any State; provided, however, that (i) such successor entity either (a) expressly assumes all of the obligations of the Trust with respect to the Capital Securities or (b) substitutes for the Capital Securities other securities having substantially the same terms as the Capital Securities (the "SUCCESSOR SECURITIES") so long as the Successor Securities rank the same as the Capital Securities rank in priority with respect to distributions and payments upon liquidation, redemption and otherwise, (ii) the Depositor expressly appoints a trustee of such successor entity possessing the same powers and duties as the Property Trustee as the holder of the Debentures, (iii) the Successor Securities are listed or traded, or any Successor Securities will be listed upon notification of issuance, on any national securities exchange or other organization on which the Capital Securities are then listed or traded, if any, (iv) such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not cause the Capital Securities (including any Successor Securities) to be downgraded by any nationally recognized statistical rating organization, (v) such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not adversely affect the rights, preferences and privileges of the Holders of the Capital Securities (including any Successor Securities) in any material respect, (vi) such successor entity has a purpose substantially identical to that of the Trust, (vii) prior to such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease, the Depositor has received an Opinion of Counsel to the effect that (a) such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not adversely affect the rights, preferences and privileges of the Holders of the Capital Securities (including any Successor Securities) in any material respect, and (b) following such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease, neither the Trust nor such successor entity will be required to register as an investment company under the 1940 Act and (viii) the Depositor or any permitted successor or assignee owns all of the common securities of such successor entity and guarantees the obligations of such successor entity under the Successor Securities at least to the extent provided by the Guarantee. Notwithstanding the foregoing, the Trust shall not, except with the consent of Holders of 100% in Liquidation Amount of the Capital Securities, consolidate, amalgamate, merge with or into, or be replaced by or convey, transfer or lease its properties and assets substantially as an entirety to any other Person or permit any other Person to consolidate, amalgamate, merge with or into, or replace it if such consolidation, amalgamation, merger, replacement, conveyance, transfer or lease would cause the Trust or the successor entity to be classified as other than a grantor trust for United States federal income tax purposes. 53 ARTICLE X MISCELLANEOUS PROVISIONS ------------------------ Section 10.1. Limitation of Rights of Securityholders to Terminate Trust. ---------------------------------------------------------- Subject to SECTION 9.2, the death, incapacity, dissolution, liquidation, termination or bankruptcy of any Person having an interest, beneficial or otherwise, in Trust Securities shall not operate to terminate this Trust Agreement, dissolve, terminate or annul the Trust, nor entitle the legal representatives, successors or heirs of such Person or any Securityholder for such Person, to claim an accounting, take any action or bring any proceeding in any court for a partition or winding up of the arrangements contemplated hereby, nor otherwise affect the rights, obligations and liabilities of the parties hereto or any of them. Section 10.2. Amendment. (a) This Trust Agreement may be amended from time --------- to time by the Property Trustee, the Delaware Trustee, the Administrative Trustees and the Depositor, without the consent of any Securityholders, (i) to cure any ambiguity, correct or supplement any provision herein that may be inconsistent with any other provision herein, or to make any other provisions with respect to matters or questions arising under this Trust Agreement, which shall not be inconsistent with the other provisions of this Trust Agreement, (ii) to modify, eliminate or add to any provisions of this Trust Agreement to such extent as shall be necessary to ensure that the Trust will be classified for United States federal income tax purposes as a grantor trust at all times that any Trust Securities are outstanding or to ensure that the Trust will not be required to register as an investment company under the 1940 Act; provided, however, that with respect to clause (i) any such action shall not adversely affect in any material respect the interests of any Securityholder or the Property Trustee or the Delaware Trustee, and any amendments of this Trust Agreement shall become effective when notice thereof is given to the Securityholders or (iii) to provide the Property Trustee with the authority to execute on behalf of the Administrative Trustees Definitive Capital Securities Certificates. (b) Except as provided in SECTION 10.2(c) hereof, any provision of this Trust Agreement may be amended by the Trustees and the Depositor with (i) the consent of Trust Securityholders representing not less than a majority (based upon Liquidation Amounts) of the Trust Securities then Outstanding and (ii) receipt by the Trustees of an Opinion of Counsel to the effect that such amendment or the exercise of any power granted to the Trustees in accordance with such amendment will not affect the Trust's status as a grantor trust for United States federal income tax purposes or the Trust's exemption from status of an investment company under the 1940 Act. (c) In addition to and notwithstanding any other provision in this Trust Agreement, without the consent of each affected Securityholder (such consent being obtained in accordance with SECTION 6.3 or 6.6 hereof), this Trust Agreement may not be amended to (i) change the amount or timing of any Distribution on the Trust Securities or otherwise adversely affect the amount of any Distribution required to be made in respect of the Trust Securities as of a specified date or (ii) restrict the right of a Securityholder to institute suit for the enforcement of any such payment on or after such date; notwithstanding any other provision herein, without the unanimous consent of the Securityholders (such consent being obtained in accordance with SECTION 6.3 or 6.6 hereof), this paragraph (c) of this SECTION 10.2 may not be amended. 54 (d) Notwithstanding any other provisions of this Trust Agreement, no Trustee shall enter into or consent to any amendment to this Trust Agreement that would cause the Trust to fail or cease to qualify for the exemption from status of an investment company under the 1940 Act or fail or cease to be classified as a grantor trust for United States federal income tax purposes. (e) Notwithstanding anything in this Trust Agreement to the contrary, without the consent of the Depositor, this Trust Agreement may not be amended in a manner that imposes any additional obligation on the Depositor. (f) In the event that any amendment to this Trust Agreement is made, the Administrative Trustees shall promptly provide to the Depositor a copy of such amendment. (g) Neither the Property Trustee nor the Delaware Trustee shall be required to enter into any amendment to this Trust Agreement that affects its own rights, duties or immunities under this Trust Agreement. The Property Trustee shall be entitled to receive an Opinion of Counsel and an Officers' Certificate stating that any amendment to this Trust Agreement is in compliance with this Trust Agreement. Section 10.3. Separability. In case any provision in this Trust Agreement ------------ or in the Trust Securities Certificates is invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. Section 10.4. Governing Law. THIS TRUST AGREEMENT AND THE RIGHTS OF THE ------------- PARTIES HEREUNDER SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE AND ALL RIGHTS AND REMEDIES SHALL BE GOVERNED BY SUCH LAWS WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS OF THE STATE OF DELAWARE OR ANY OTHER JURISDICTION THAT WOULD CALL FOR THE APPLICATION OF THE LAW OF ANY JURISDICTION OTHER THAN THE STATE OF DELAWARE; PROVIDED, HOWEVER, THAT THERE SHALL NOT BE APPLICABLE TO THE PARTIES HEREUNDER OR THIS TRUST AGREEMENT ANY PROVISION OF THE LAWS (STATUTORY OR COMMON) OF THE STATE OF DELAWARE PERTAINING TO TRUSTS THAT RELATE TO OR REGULATE, IN A MANNER INCONSISTENT WITH THE TERMS HEREOF (A) THE FILING WITH ANY COURT OR GOVERNMENTAL BODY OR AGENCY OF TRUSTEE ACCOUNTS OR SCHEDULES OF TRUSTEE FILES AND CHARGES, (B) AFFIRMATIVE REQUIREMENTS TO POST BONDS FOR TRUSTEES, OFFICERS, AGENTS OR EMPLOYEES OF A TRUST, (C) THE NECESSITY FOR OBTAINING COURT OR OTHER GOVERNMENTAL APPROVAL CONCERNING THE ACQUISITION, HOLDING OR DISPOSITION OF REAL OR PERSONAL PROPERTY, (D) FEES OR OTHER SUMS PAYABLE TO TRUSTEES, OFFICERS, AGENTS OR EMPLOYEES OF A TRUST, (E) THE ALLOCATION OF RECEIPTS AND EXPENDITURES TO INCOME OR PRINCIPAL, (F) RESTRICTIONS OR LIMITATIONS ON THE PERMISSIBLE NATURE, AMOUNT OR CONCENTRATION OF THE TRUST INVESTMENTS OR REQUIREMENTS RELATING TO THE TITLING, STORAGE OR OTHER MANNER OF HOLDING OR INVESTING TRUST ASSETS OR (G) THE ESTABLISHMENT OF FIDUCIARY OR OTHER STANDARDS OF 55 RESPONSIBILITY OR LIMITATIONS ON THE ACTS OR POWERS OF TRUSTEES THAT ARE INCONSISTENT WITH THE LIMITATIONS OR LIABILITIES OR AUTHORITIES AND POWERS OF THE TRUSTEES HEREUNDER AS SET FORTH OR REFERENCED IN THIS DECLARATION. SECTION 3540 OF TITLE 12 OF THE DELAWARE CODE SHALL NOT APPLY TO THE TRUST. Section 10.5. Payments Due on Non-Business Day. If the date fixed for any -------------------------------- payment on any Trust Security is a day that is not a Business Day, then such payment need not be made on such date but may be made on the next succeeding day that is a Business Day, with the same force and effect as though made on the date fixed for such payment, and no interest shall accrue thereon for the period after such date. Section 10.6. Successors. This Trust Agreement shall be binding upon and ---------- shall inure to the benefit of any successor to the Depositor, the Trust or the Relevant Trustee, including any successor by operation of law. Except in connection with a consolidation, merger, conversion or sale involving the Depositor that is permitted under Article Eleven of the Indenture and pursuant to which the assignee agrees in writing to perform the Depositor's obligations hereunder, the Depositor shall not assign its obligations hereunder. Section 10.7. Headings. The Article and Section headings are for -------- convenience only and shall not affect the construction of this Trust Agreement. Section 10.8. Reports, Notices and Demands. Any report, notice, demand or ---------------------------- other communication that by any provision of this Trust Agreement is required or permitted to be given or served to or upon any Securityholder or the Depositor may be given or served in writing by deposit thereof, first-class postage prepaid, in the United States mail, hand delivery or facsimile transmission, in each case, addressed, (a) in the case of a Holders of Capital Securities, to such Capital Securityholder as such Securityholder's name and address may appear on the Securities Register; and (b) in the case of the Holder of Common Securities or the Depositor, to DPL Inc., Courthouse Plaza Southwest, Dayton, Ohio 45402, Attention: Treasurer, facsimile no.: 937-259-7368. Such notice, demand or other communication to or upon a Securityholder shall be deemed to have been sufficiently given or made, for all purposes, upon hand delivery, mailing or transmission. Any notice, demand or other communication that by any provision of this Trust Agreement is required or permitted to be given or served to or upon the Trust, the Property Trustee, the Delaware Trustee or the Administrative Trustees shall be given in writing addressed (until another address is published by the Trust) as follows: (a) with respect to the Property Trustee to The Bank of New York, 101 Barclay Street, Floor 21 West, New York, New York 10286, Attention: Corporate Trust Administration, (b) with respect to the Delaware Trustee, to The Bank of New York (Delaware), White Clay Center, Route 273, Newark, Delaware, 19711 Attention: Corporate Trust Department, with a copy to the Property Trustee at the address in (a) above for notice to the Property Trustee, and (c) with respect to the Administrative Trustees, to them at the address above for notices to the Depositor, marked "Attention: Administrative Trustees of DPL Capital Trust II." Such notice, demand or other communication to or upon the Trust or the Property Trustee or the Delaware Trustee shall be deemed to have been 56 sufficiently given or made only upon actual receipt of the writing by the Trust or the Property Trustee (whether given to the Property Trustee or the Delaware Trustee). Section 10.9. Agreement Not to Petition. Each of the Trustees and the ------------------------- Depositor agree for the benefit of the Securityholders that, until at least one year and one day after the Trust has been terminated in accordance with Article IX, they shall not file, or join in the filing of, a petition against the Trust under any bankruptcy, insolvency, reorganization or other similar law (including, without limitation, the United States Bankruptcy Code) (collectively, "BANKRUPTCY LAWS") or otherwise join in the commencement of any proceeding against the Trust under any Bankruptcy Law. In the event the Depositor takes action in violation of this SECTION 10.9, the Property Trustee agrees, for the benefit of Securityholders, that at the expense of the Depositor, it shall file an answer with the bankruptcy court or otherwise properly contest the filing of such petition by the Depositor against the Trust or the commencement of such action and raise the defense that the Depositor has agreed in writing not to take such action and should be stopped and precluded therefrom and such other defenses, if any, as counsel for the Trustee or the Trust may assert. The provisions of this SECTION 10.9 shall survive the termination of this Trust Agreement. Section 10.10. Trust Indenture Act; Conflict with Trust Indenture Act. ------------------------------------------------------ (a) This Trust Agreement is intended to be in conformity with the provisions of the Trust Indenture Act that would be required to be part of this Trust Agreement if this Trust Agreement were qualified under the Trust Indenture Act and shall, to the extent applicable, be governed by such provisions. (b) The Property Trustee shall be the only Trustee that is a trustee for the purposes of the Trust Indenture Act. (c) If any provision hereof limits, qualifies or conflicts with the duties imposed under Sections 310 through 318 of the Trust Indenture Act if this Trust Agreement were qualified under the Trust Indenture Act, such duties shall control. If any provision of this Trust Agreement modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, the latter provision shall be deemed to apply to this Trust Agreement as so modified or excluded, as the case may be. (d) The application of the Trust Indenture Act to this Trust Agreement shall not affect the nature of the Trust Securities as equity securities representing undivided beneficial interests in the assets of the Trust. Section 10.11. Acceptance of Terms of Trust Agreement, Guarantee and ----------------------------------------------------- Indenture. THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST - --------- THEREIN BY OR ON BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH 57 SECURITYHOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND SUCH SECURITYHOLDER AND SUCH OTHERS. Section 10.12. Counterparts. This Trust Agreement 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. 58 IN WITNESS WHEREOF, the parties have executed this Amended and Restated Trust Agreement of DPL Capital Trust II as of the date first above written. DPL INC. By: /s/ Elizabeth M. McCarthy ------------------------------------- Name: Elizabeth M. McCarthy Title: THE BANK OF NEW YORK, as Property Trustee By: /s/ Paul J. Schmalzel ------------------------------------- Name: Paul J. Schmalzel Title: THE BANK OF NEW YORK (DELAWARE), as Delaware Trustee By: /s/ William T. Lewis ------------------------------------- Name: William T. Lewis Title: /s/ Stephen F. Koziar, Jr. ---------------------------------------- Stephen F. Koziar, Jr. as Administrative Trustee /s/ Allen M. Hill ---------------------------------------- Allen M. Hill as Administrative Trustee EXHIBIT A CERTIFICATE OF TRUST OF DPL CAPITAL TRUST II THIS Certificate of Trust of DPL Capital Trust II (the "Trust"), dated as of August 23, 2001, is being duly executed and filed by the undersigned, as trustees, to form a business trust under the Delaware Business Trust Act (12 Del. C. (S)3801, et seq.). 1. Name. The name of the business trust formed hereby is DPL Capital ---- Trust II. 2. Delaware Trustee. The name and business address of the trustee of the ---------------- Trust in the State of Delaware are The Bank of New York (Delaware), White Clay Center, Route 273, Newark, Delaware, 19711 Attention: Corporate Trust Department. 3. Effective Date. This Certificate of Trust shall be effective upon -------------- filing. IN WITNESS WHEREOF, the undersigned, being all of the trustees of the Trust, have executed this Certificate of Trust as of the date first-above written. THE BANK OF NEW YORK (DELAWARE) not in its individual capacity but solely as trustee of the Trust /s/ William T. Lewis ---------------------------------------- William T. Lewis Senior Vice President /s/ Stephen F. Koziar, Jr. ---------------------------------------- not in his individual capacity but solely as trustee of the Trust A-1 EXHIBIT B FORM OF 144A GLOBAL SECURITY This Capital Security is a 144A Global Security within the meaning of the Trust Agreement hereinafter referred to and is registered in the name of The Depository Trust Company (the "DEPOSITORY") or a nominee of the Depository. This Capital Security is exchangeable for Capital Securities registered in the name of a person other than the Depository or its nominee only in the limited circumstances described in the Trust Agreement and no transfer of this Capital Security (other than a transfer of this Capital Security as a whole by the Depository to a nominee of the Depository or by a nominee of the Depository to the Depository or another nominee of the Depository) may be registered except in limited circumstances. Unless this Capital Security is presented by an authorized representative of The Depository Trust Company ("DTC"), a New York corporation (55 Water Street, New York), to DPL Capital Trust II or its agent for registration of transfer, exchange or payment, and any Capital Security issued is registered in the name of Cede & Co. or such other name as is requested by an authorized representative of DTC (and any payment hereon is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. THE CAPITAL SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, EACH HOLDER OF THE CAPITAL SECURITIES EVIDENCED HEREBY, AND EACH PERSON THAT ACQUIRES A BENEFICIAL INTEREST IN SUCH CAPITAL SECURITIES, (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501 (a)(1),(2),(3) OR (7) UNDER THE SECURITIES ACT) ("INSTITUTIONAL ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THE CAPITAL SECURITIES EVIDENCED HEREBY IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL NOT, PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE CAPITAL SECURITIES EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT B-1 (OR ANY SUCCESSOR PROVISION), OFFER, RESELL OR OTHERWISE TRANSFER SUCH CAPITAL SECURITIES EXCEPT (A) TO DPL INC. OR A SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (D) INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE BANK OF NEW YORK, AS PROPERTY TRUSTEE, A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF SUCH CAPITAL SECURITIES (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM SUCH TRUSTEE), (E) OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT OR (F) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) AND (G) IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE CAPITAL SECURITIES EVIDENCED HEREBY ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED INVESTOR OR A PURCHASER WHO IS NOT A U.S. PERSON, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE BANK OF NEW YORK, AS PROPERTY TRUSTEE, SUCH CERTIFICATIONS OR OTHER INFORMATION AS DPL INC. MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED AFTER THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE CAPITAL SECURITIES EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT OR SUCH EARLIER TIME AS A TRANSFER OF SUCH CAPITAL SECURITIES IS MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" "UNITED STATES" AND B-2 "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT. BY ITS ACCEPTANCE OF THE CAPITAL SECURITIES EVIDENCED HEREBY OR A BENEFICIAL INTEREST IN SUCH CAPITAL SECURITIES, THE HOLDER OF, AND ANY PERSON THAT ACQUIRES A BENEFICIAL INTEREST IN, SUCH CAPITAL SECURITIES AGREES TO BE BOUND BY THE PROVISIONS OF THE EXCHANGE AND REGISTRATION RIGHTS AGREEMENT, DATED AS OF AUGUST 24, 2001, AND RELATING TO THE REGISTRATION UNDER THE SECURITIES ACT OF (1) CAPITAL SECURITIES EXCHANGEABLE FOR THE CAPITAL SECURITIES EVIDENCED HEREBY AND REGISTRATION OF THE CAPITAL SECURITIES EVIDENCED HEREBY, (2) THE GUARANTEE BY DPL INC. IN RESPECT OF SUCH CAPITAL SECURITIES AND (3) THE 8 1/8% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES DUE SEPTEMBER 1, 2031 ISSUED BY DPL INC. B-3 CERTIFICATE NUMBER R-1 CUSIP NO. 23330A AA 8 ISIN NO. US23330AAA88 CERTIFICATE EVIDENCING CAPITAL SECURITIES OF DPL CAPITAL TRUST II 8 1/8% CAPITAL SECURITIES, (LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY) DPL Capital Trust II, a statutory business trust created under the laws of the State of Delaware (the "TRUST"), hereby certifies that Cede & Co. (the "HOLDER") is the registered owner of the number of Capital Securities of the Trust specified in Schedule I hereto representing an undivided beneficial ---------- interest in the assets of the Trust and designated the DPL Capital Trust II 8 1/8% Capital Securities (Liquidation Amount $1,000 per Capital Security) (the "CAPITAL SECURITIES"). The Capital Securities are transferable on the books and records of the Trust, in person or by a duly authorized attorney, upon surrender of this certificate duly endorsed and in proper form for transfer as provided in Section 5.4 of the Trust Agreement (as defined below). The designations, rights, privileges, restrictions, preferences and other terms and provisions of the Capital Securities are set forth in, and this certificate and the Capital Securities represented hereby are issued and shall in all respects be subject to the terms and provisions of, the Amended and Restated Trust Agreement of the Trust dated as of August 31, 2001, as the same may be amended from time to time (the "TRUST AGREEMENT"), including the designation of the terms of Capital Securities as set forth therein. The Holder is entitled to the benefits of the Capital Securities Guarantee Agreement entered into by DPL Inc., an Ohio corporation, and The Bank of New York, as guarantee trustee, dated as of August 31, 2001 (the "GUARANTEE"), to the extent provided therein. The Trust will furnish a copy of the Trust Agreement and the Guarantee to the Holder without charge upon written request to the Trust at its principal place of business or registered office. Upon receipt of this certificate, the Holder is bound by the Trust Agreement and is entitled to the benefits thereunder. By its acceptance of this certificate representing Capital Securities or a beneficial interest in such Capital Securities, the owner of, and any person that acquires a beneficial interest in, such Capital Securities, agrees to treat the Debentures described in the Trust Agreement as indebtedness and the Capital Securities as evidence of indirect beneficial ownership in such indebtedness for tax purposes. B-4 In Witness Whereof, one of the Administrative Trustees of the Trust has executed this certificate as of this ___ day of __________, ______. DPL CAPITAL TRUST II By: ----------------------------------- Name: Administrative Trustee B-5 SCHEDULE I 144A GLOBAL SECURITY The initial number of Capital Securities evidenced by this 144A Global Security is ____________________. CHANGES TO NUMBER OF CAPITAL SECURITIES EVIDENCED BY 144A GLOBAL SECURITY - -------------------------------------------------------------------------------- Number of Capital Securities by which this 144A Global Security is to be Reduced or Increased, Remaining Capital and Reason for Reduction Securities Represented by Notation Date or Increase this 144A Global Security Made by - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- B-6 EXHIBIT C FORM OF REGULATION S GLOBAL SECURITY This Capital Security is a Regulation S Global Security within the meaning of the Trust Agreement hereinafter referred to and is registered in the name of The Depository Trust Company (the "DEPOSITORY") or a nominee of the Depository. This Capital Security is exchangeable for Capital Securities registered in the name of a person other than the Depository or its nominee only in the limited circumstances described in the Trust Agreement and no transfer of this Capital Security (other than a transfer of this Capital Security as a whole by the Depository to a nominee of the Depository or by a nominee of the Depository to the Depository or another nominee of the Depository) may be registered except in limited circumstances. Unless this Capital Security is presented by an authorized representative of The Depository Trust Company ("DTC"), a New York Corporation (55 Water Street, New York), to DPL Capital Trust II or its agent for registration of transfer, exchange or payment, and any Capital Security issued is registered in the name of Cede & Co. or such other name as is requested by an authorized representative of DTC (and any payment hereon is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. BY ITS ACCEPTANCE OF THE CAPITAL SECURITIES EVIDENCED HEREBY OR A BENEFICIAL INTEREST IN SUCH CAPITAL SECURITIES, THE HOLDER OF, AND ANY PERSON THAT ACQUIRES A BENEFICIAL INTEREST IN, SUCH CAPITAL SECURITIES AGREES (A) THAT PRIOR TO THE EXPIRATION OF THE DISTRIBUTION COMPLIANCE PERIOD (AS DEFINED IN THE TRUST AGREEMENT), BENEFICIAL INTERESTS IN THIS SECURITY MAY ONLY BE HELD BY CLEARING AGENCY PARTICIPANTS (AS DEFINED IN THE TRUST AGREEMENT) IN THE NAME OF A NOMINEE OF EUROCLEAR OR CLEARSTREAM (IN EACH CASE AS DEFINED IN THE TRUST AGREEMENT) AND (B) TO BE BOUND BY THE PROVISIONS OF THE EXCHANGE AND REGISTRATION RIGHTS AGREEMENT, DATED AS OF AUGUST 24, 2001, AND RELATING TO THE REGISTRATION UNDER THE SECURITIES ACT OF (1) CAPITAL SECURITIES EXCHANGEABLE FOR THE CAPITAL SECURITIES EVIDENCED HEREBY AND REGISTRATION OF THE CAPITAL SECURITIES EVIDENCED HEREBY, (2) THE GUARANTEE BY DPL INC. IN RESPECT OF SUCH CAPITAL SECURITIES AND (3) THE 8 1/8% C-1 JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES DUE SEPTEMBER 1, 2031 ISSUED BY DPL INC. C-2 CERTIFICATE NUMBER S-1 CUSIP NO. U26057 AA 4 ISIN NO. USU26057AA40 CERTIFICATE EVIDENCING CAPITAL SECURITIES OF DPL CAPITAL TRUST II 8 1/8% CAPITAL SECURITIES (LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY) DPL Capital Trust II, a statutory business trust created under the laws of the State of Delaware (the "TRUST"), hereby certifies that Cede & Co. (the "HOLDER") is the registered owner of the number of Capital Securities of the Trust specified in Schedule I hereto representing an undivided beneficial interest in the assets of the Trust and designated the DPL Capital Trust II 8 1/8% Capital Securities (Liquidation Amount $1,000 per Capital Security) (the "CAPITAL SECURITIES"). The Capital Securities are transferable on the books and records of the Trust, in person or by a duly authorized attorney, upon surrender of this certificate duly endorsed and in proper form for transfer as provided in Section 5.4 of the Trust Agreement (as defined below). The designations, rights, privileges, restrictions, preferences and other terms and provisions of the Capital Securities are set forth in, and this certificate and the Capital Securities represented hereby are issued and shall in all respects be subject to the terms and provisions of, the Amended and Restated Trust Agreement of the Trust dated as of August 31, 2001, as the same may be amended from time to time (the "TRUST AGREEMENT"), including the designation of the terms of Capital Securities as set forth therein. The Holder is entitled to the benefits of the Capital Securities Guarantee Agreement entered into by DPL Inc., an Ohio corporation, and The Bank of New York, as guarantee trustee, dated as of August 31, 2001 (the "GUARANTEE"), to the extent provided therein. The Trust will furnish a copy of the Trust Agreement and the Guarantee to the Holder without charge upon written request to the Trust at its principal place of business or registered office. Upon receipt of this certificate, the Holder is bound by the Trust Agreement and is entitled to the benefits thereunder. By its acceptance of this certificate representing Capital Securities or a beneficial interest in such Capital Securities, the owner of, and any person that acquires a beneficial interest in, such Capital Securities, agrees to treat the Debentures described in the Trust Agreement as indebtedness and the Capital Securities as evidence of indirect beneficial ownership in such indebtedness for tax purposes. C-3 IN WITNESS WHEREOF, one of the Administrative Trustees of the Trust has executed this certificate. DPL CAPITAL TRUST II By: ----------------------------------- Name: Administrative Trustee Dated: ________________ C-4 SCHEDULE I REGULATION S GLOBAL SECURITY The initial number of Capital Securities evidenced by this Regulation S Global Security is __________. CHANGES TO NUMBER OF CAPITAL SECURITIES EVIDENCED BY REGULATION S GLOBAL SECURITY - -------------------------------------------------------------------------------- Number of Capital ecurities by which this Regulation S Global Remaining Capital Security is to be Reduced Securities Represented by or Increased, and Reason this Regulation S Notation Date for Reduction or Increase Global Security Made by - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- EXHIBIT D FORM OF DEFINITIVE CAPITAL SECURITY CERTIFICATE THE CAPITAL SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, EACH HOLDER OF THE CAPITAL SECURITIES EVIDENCED HEREBY, AND EACH PERSON THAT ACQUIRES A BENEFICIAL INTEREST IN SUCH CAPITAL SECURITIES, (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501 (a)(1),(2),(3) OR (7) UNDER THE SECURITIES ACT) ("INSTITUTIONAL ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THE CAPITAL SECURITIES EVIDENCED HEREBY IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL NOT, PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE CAPITAL SECURITIES EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION), OFFER, RESELL OR OTHERWISE TRANSFER SUCH CAPITAL SECURITIES EXCEPT (A) TO DPL INC. OR A SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (D) INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE BANK OF NEW YORK, AS PROPERTY TRUSTEE, A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF SUCH CAPITAL SECURITIES (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM SUCH TRUSTEE), (E) OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT OR (F) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) AND (G) IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION, AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE CAPITAL SECURITIES EVIDENCED HEREBY ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED INVESTOR OR A PURCHASER WHO IS NOT A U.S. PERSON, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE BANK OF NEW YORK, AS PROPERTY TRUSTEE, SUCH CERTIFICATIONS OR OTHER INFORMATION AS DPL INC. MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED AFTER THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE CAPITAL SECURITIES D-1 EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT OR SUCH EARLIER TIME AS A TRANSFER OF SUCH CAPITAL SECURITIES IS MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT. BY ITS ACCEPTANCE OF THE CAPITAL SECURITIES EVIDENCED HEREBY OR A BENEFICIAL INTEREST IN SUCH CAPITAL SECURITIES, THE HOLDER OF, AND ANY PERSON THAT ACQUIRES A BENEFICIAL INTEREST IN, SUCH CAPITAL SECURITIES, AGREES TO BE BOUND BY THE PROVISIONS OF THE EXCHANGE AND REGISTRATION RIGHTS AGREEMENT, DATED AS OF AUGUST 24, 2001, AND RELATING TO THE REGISTRATION UNDER THE SECURITIES ACT OF (1) CAPITAL SECURITIES EXCHANGEABLE FOR THE CAPITAL SECURITIES EVIDENCED HEREBY AND REGISTRATION OF THE CAPITAL SECURITIES EVIDENCED HEREBY, (2) THE GUARANTEE BY DPL INC. IN RESPECT OF SUCH CAPITAL SECURITIES AND (3) THE 8 1/8% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES DUE SEPTEMBER 1, 2031 ISSUED BY DPL INC. D-2 CERTIFICATE NUMBER AI-1 NUMBER OF CAPITAL SECURITIES -------------- CERTIFICATE EVIDENCING CAPITAL SECURITIES OF DPL CAPITAL TRUST II 8 1/8% CAPITAL SECURITIES (LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY) DPL Capital Trust II, a statutory business trust created under the laws of the State of Delaware (the "TRUST"), hereby certifies that _____________________ (the "HOLDER") is the registered owner of ____________________________ of the Trust representing an undivided beneficial interest in the assets of the Trust and designated the DPL Capital Trust II 8 1/8% Capital Securities (Liquidation Amount $1,000 per Capital Security) (the "CAPITAL SECURITIES"). The Capital Securities are transferable on the books and records of the Trust, in person or by a duly authorized attorney, upon surrender of this certificate duly endorsed and in proper form for transfer as provided in Section 5.4 of the Trust Agreement (as defined below). The designations, rights, privileges, restrictions, preferences and other terms and provisions of the Capital Securities are set forth in, and this certificate and the Capital Securities represented hereby are issued and shall in all respects be subject to the terms and provisions of, the Amended and Restated Trust Agreement of the Trust dated as of August 31, 2001, as the same may be amended from time to time (the "TRUST AGREEMENT"), including the designation of the terms of Capital Securities as set forth therein. The Holder is entitled to the benefits of the Guarantee Agreement entered into by DPL Inc., an Ohio corporation, and The Bank of New York, as guarantee trustee, dated as of August 31, 2001 (the "GUARANTEE"), to the extent provided therein. The Trust will furnish a copy of the Trust Agreement and the Guarantee to the Holder without charge upon written request to the Trust at its principal place of business or registered office. Upon receipt of this certificate, the Holder is bound by the Trust Agreement and is entitled to the benefits thereunder. By its acceptance of this certificate representing Capital Securities or a beneficial interest in such Capital Securities, the owner of, and any person that acquires a beneficial interest in, such Capital Securities, agrees to treat the Debentures described in the Trust Agreement as indebtedness and the Capital Securities as evidence of indirect beneficial ownership in such indebtedness for tax purposes. D-3 In Witness Whereof, one of the Administrative Trustees of the Trust has executed this certificate as of this ___ day of __________, _____. DPL CAPITAL TRUST II By: ----------------------------------- Name: Administrative Trustee D-4 FORM OF ASSIGNMENT For value received ________________ hereby sell(s), assign(s) and transfer(s) unto ------------------------------------------------------------------------ - ------------------------------------------------------------------------------ (Please insert social security or other taxpayer identification number of assignee.) the within security and hereby irrevocably constitutes and appoints _________________________ attorney to transfer the said security on the books of the Trust, with full power of substitution in the premises. In connection with any transfer of the within security occurring prior to such date as restrictions on the transfer of such security imposed by the Securities Act of 1933, as amended (the "Securities Act"), and the rules and regulations thereunder, are terminated in accordance with the Trust Agreement, the undersigned confirms that such security is being transferred: [ ] To DPL Inc. or a subsidiary thereof; or [ ] Pursuant to an effective registration statement under the Securities Act; or [ ] Pursuant to and in compliance with Rule 144A under the Securities Act; or [ ] To an Institutional Accredited Investor pursuant to and in compliance with the Securities Act; or [ ] Pursuant to and in compliance with Regulation S under the Securities Act; or [ ] Pursuant to and in compliance with Rule 144 under the Securities Act; and unless the box below is checked, the undersigned confirms that such security is not being transferred to an "affiliate" of the Trust as defined in Rule 144 under the Securities Act (an "AFFILIATE"): [ ] The transferee is an Affiliate of the Trust. D-5 [IF CAPITAL SECURITY IS AN EXCHANGE CAPITAL SECURITY, INSERT - FORM OF ASSIGNMENT For Value Received, the undersigned assigns and transfers this Capital Security to:__________________________________________________________ (Insert assignee's social security or tax identification number) - ---------------------------------------- (Insert address and zip code of assignee) and irrevocably appoints _____________________________ agent to transfer this Capital Security Certificate on the books of the Trust. The agent may substitute another to act for him or her. Date: Signature(s): --------------------------------------- --------------------------------------- (Sign exactly as your name appears on the other side of this Capital Security Certificate) NOTICE: THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17AD-15. D-6 Dated: ___________________ ---------------------------------------- ---------------------------------------- Signature(s) Signature(s) must be guaranteed by a commercial bank or trust company or a member firm of a major stock exchange. ---------------------------------------- Signature Guarantee NOTICE: The above signatures of the holder(s) hereof must correspond with the name as written upon the face of this Security in every particular, without alteration or enlargement or any change whatever. D-7 EXHIBIT E THIS CERTIFICATE IS NOT TRANSFERABLE CERTIFICATE NUMBER C-____ NUMBER OF COMMON SECURITIES ------------------------ CERTIFICATE EVIDENCING COMMON SECURITIES OF DPL CAPITAL TRUST II (LIQUIDATION AMOUNT $1,000 PER COMMON SECURITY) DPL Capital Trust II, a statutory business trust created under the laws of the State of Delaware (the "TRUST"), hereby certifies that DPL Inc., an Ohio corporation, (the "HOLDER") is the registered owner of ___________________________ Common Securities of the Trust representing an undivided beneficial interest in the assets of the Trust and designated the Common Securities (Liquidation Amount $1,000 per Common Security) (the "COMMON SECURITIES"). In accordance with Section 5.10 of the Trust Agreement (as defined below) the Common Securities are not transferable and any attempted transfer hereof shall be void. The designations, rights, privileges, restrictions, preferences and other terms and provisions of the Common Securities are set forth in, and this certificate and the Common Securities represented hereby are issued and shall in all respects be subject to the terms and provisions of, the Amended and Restated Trust Agreement of the Trust dated as of August 31, 2001, as the same may be amended from time to time (the "TRUST AGREEMENT"), including the designation of the terms of the Common Securities as set forth therein. The Trust will furnish a copy of the Trust Agreement to the Holder without charge upon written request to the Trust at its principal place of business or registered office. Upon receipt of this certificate, the Holder is bound by the Trust Agreement and is entitled to the benefits thereunder. By its acceptance of this certificate representing Common Securities or a beneficial interest in such Common Securities, the owner of, and any person that acquires a beneficial interest in, such Common Securities, agrees to treat the Debentures described in the Trust Agreement as indebtedness and the Common Securities as evidence of indirect beneficial ownership in such indebtedness for tax purposes. E-1 In WITNESS WHEREOF, one of the Administrative Trustees of the Trust has executed this certificate as of this ___ day of _______, _____. DPL CAPITAL TRUST II By: ----------------------------------- Name: Administrative Trustee E-2 EXHIBIT F FORM OF LETTER TO BE DELIVERED BY INSTITUTIONAL ACCREDITED INVESTORS DPL Inc. Courthouse Plaza Southwest Dayton, Ohio 45402 DPL Capital Trust II Courthouse Plaza Southwest Dayton, Ohio 45402 Morgan Stanley & Co. Incorporated 1585 Broadway New York, New York 10036 Ladies and Gentlemen: We understand that the 8 1/8% Capital Securities, (Liquidation Amount $1,000 per Capital Security) (the "CAPITAL SECURITIES"), of DPL Capital Trust II, a Delaware business trust (including the guarantee (the "GUARANTEE") of DPL Inc. ("DPL") executed in connection therewith), and the 8 1/8% Junior Subordinated Deferrable Interest Debentures due September 1, 2031 of DPL (the "DEBENTURES," and, together with the Capital Securities and the Guarantee, the "SECURITIES") are being offered in a transaction not involving any public offering within the United States within the meaning of the Securities Act of 1933, as amended (the "SECURITIES ACT"), and that the Securities have not been registered under the Securities Act, and we agree, on our own behalf and on behalf of each account for which we acquire any Capital Securities, that if, prior to the expiration of the holding period applicable to sales of any Security under Rule 144(k) under the Securities Act, we decide to offer, resell or otherwise transfer such Security, such Security may be offered, resold or otherwise transferred only (i) to DPL or a subsidiary thereof, (ii) pursuant to an effective registration statement under the Securities Act, (iii) inside the United States to a person who is a "qualified institutional buyer" (as defined in Rule 144A under the Securities Act) in compliance with Rule 144A under the Securities Act, (iv) inside the United States to an Institutional Accredited Investor (as defined below) that, prior to such transfer, furnishes to the Property Trustee a signed letter in the form hereof, and such other opinions and certifications that the Property Trustee may request, (v) outside the United States in compliance with Rule 904 under the Securities Act or (vi) pursuant to the exemption from registration provided by Rule 144 under the Securities Act (if available) and (vii) in each case, in accordance with any applicable securities laws of the States of the United States or any other applicable jurisdiction and in accordance with the legend set forth on the Capital Securities and the Debentures. We further agree to provide any person purchasing any of the Capital Securities or the Debentures from us a notice advising such purchaser that resales of such securities are restricted as stated herein. We understand that any Capital Securities will bear a legend reflecting the substance of this paragraph. F-1 We confirm that: (i) we are an "accredited investor" within the meaning of Rule 501(a)(1), (2) or (3) under the Securities Act or an entity in which all of the equity owners are accredited investors within the meaning of Rule 501(a)(1), (2) or (3) under the Securities Act (an "Institutional Accredited Investor"); (ii) (A) any purchase of Capital Securities by us will be for our own account or for the account of one or more other Institutional Accredited Investors or as fiduciary for the account of one or more trusts, each of which is an "accredited investor" within the meaning of Rule 501(a)(7) under the Securities Act and for each of which we exercise sole investment discretion or (B) we are a "bank," within the meaning of Section 3(a)(2) of the Securities Act, or a "savings and loan association" or other institution described in Section 3(a)(5)(A) of the Securities Act that is acquiring Capital Securities as fiduciary for the account of one or more institutions for which we exercise sole investment discretion; (iii) we have such knowledge and experience in financial and business matters that we are capable of evaluating the merits and risks of an investment in the Capital Securities; (iv) we are not acquiring Capital Securities with a view to resale or distribution thereof or with any present intention of offering or selling Capital Securities, except as permitted above; provided that the disposition of our property and property of any accounts for which we are acting as fiduciary shall remain at all times within our control; and (v) we have had access to such financial and other information and have been afforded the opportunity to ask such questions of representatives of DPL Inc. and receive answers thereto, as we deem necessary in connection with our decision to purchase Capital Securities. We acknowledge that you and others will rely upon our confirmations, acknowledgments and agreements set forth herein, and we agree to notify you promptly in writing if any of our representations or warranties herein ceases to be accurate and complete. THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK. (Name of Purchaser) ---------------------------------------- Name: Title: Address: F-2 EXHIBIT G FORM OF TRANSFER CERTIFICATE 144A GLOBAL SECURITY TO REGULATION S GLOBAL SECURITY The Bank of New York 101 Barclay Street, 21 West New York, New York, 10286 Attention: Corporate Trust Administration Re: DPL Capital Trust II Private Capital Securities Reference is hereby made to the Amended and Restated Trust Agreement, dated as of August 31, 2001 (the "TRUST AGREEMENT"), among DPL Inc., The Bank of New York, as Property Trustee, The Bank of New York (Delaware), as Delaware Trustee, the Administrative Trustees named therein and the holders, from time to time, of undivided beneficial interests in the assets of DPL Capital Trust II. Capitalized terms used but not defined herein shall have the meanings given to them in the Trust Agreement. This letter relates to _________________ Private Capital Securities which are evidenced by a 144A Global Security (CUSIP No. 23330A AA 8) and held with the Clearing Agency indirectly in the name of [_________________] (the "Transferor"). The Transferor has requested a transfer of such beneficial interest in such Private Capital Securities to a Person that will take delivery thereof in a transaction effected pursuant to and in accordance with Rule 904 under the United States Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, the Transferor does hereby further certify that: The offer of such Private Capital Securities was not made to a person in the United States; (A) either: (i) at the time the buy order was originated, the transferee was outside the United States or the Transferor and any person acting on its behalf reasonably believed that the transferee was outside the United States, or (ii) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither the Transferor nor any person acting on its behalf knows that the transaction was pre-arranged with a buyer in the United States; (B) no directed selling efforts have been made in contravention of the requirements of 904(b) under the Securities Act, as applicable; G-1 (C) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act; and (D) we have advised the transferee of the transfer restrictions applicable to such Private Capital Securities. You, the Trust and the Initial Purchaser are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby. Terms used in this certificate and not otherwise defined herein or in the Trust Agreement have the meanings set forth in Regulation S under the Securities Act. Dated:__________________ [Insert Name of Transferor] By: ----------------------------------- Name: Title: (If the registered owner is a corporation, partnership or fiduciary, the title of the Person signing on behalf of such registered owner must be stated.) G-2 EXHIBIT H FORM OF TRANSFER CERTIFICATE REGULATION S GLOBAL SECURITY TO 144A GLOBAL SECURITY The Bank of New York 101 Barclay Street, 21 West New York, New York, 10286 Attention: Corporate Trust Administration Re: DPL Capital Trust II Private Capital Securities Reference is hereby made to the Amended and Restated Trust Agreement, dated as of August 31, 2001 (the "TRUST AGREEMENT"), among DPL Inc., The Bank of New York, as Property Trustee, The Bank of New York (Delaware), as Delaware Trustee, the Administrative Trustees named therein and the holders, from time to time, of undivided beneficial interests in the assets of DPL Capital Trust II. Capitalized terms used but not defined herein shall have the meanings given to them in the Trust Agreement. This letter relates to _________________ Private Capital Securities which are evidenced by a Regulation S Global Security (CUSIP No. U26057 AA 4) and held with the Clearing Agency indirectly in the name of [_________________] (the "TRANSFEROR"). The Transferor has requested a transfer of such beneficial interest in such Private Capital Securities to a Person that will take delivery thereof in a transaction effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the "SECURITIES ACT"), and, accordingly, the Transferor does hereby certify that (i) the Transferor's interest in such Private Capital Securities is being transferred in accordance with the transfer restrictions set forth in the Trust Agreement; and (ii) the transferee is a person who the Transferor reasonably believes is a "qualified institutional buyer" within the meaning of Rule 144A under the Securities Act, purchasing for its own account or the account of a qualified institutional buyer in a transaction meeting the requirements of Rule 144A, in accordance with all applicable securities laws of the states of the United States and other jurisdictions. H-1 You, the Trust and the Initial Purchaser are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby. Dated:__________________ [Insert Name of Transferor] By: ----------------------------------- Name: Title: (If the registered owner is a corporation, partnership or fiduciary, the title of the Person signing on behalf of such registered owner must be stated.) H-2 EXHIBIT I FORM OF PRIVATE PLACEMENT LEGEND THE CAPITAL SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, EACH HOLDER OF THE CAPITAL SECURITIES EVIDENCED HEREBY, AND EACH PERSON THAT ACQUIRES A BENEFICIAL INTEREST IN SUCH CAPITAL SECURITIES, (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501 (a)(1),(2),(3) OR (7) UNDER THE SECURITIES ACT) ("INSTITUTIONAL ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THE CAPITAL SECURITIES EVIDENCED HEREBY IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL NOT, PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE CAPITAL SECURITIES EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION), OFFER, RESELL OR OTHERWISE TRANSFER SUCH CAPITAL SECURITIES EXCEPT (A) TO DPL INC. OR A SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (D) INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE BANK OF NEW YORK, AS PROPERTY TRUSTEE, A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF SUCH CAPITAL SECURITIES (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM SUCH TRUSTEE), (E) OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT OR (F) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) AND (G) IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION, AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE CAPITAL SECURITIES EVIDENCED HEREBY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED INVESTOR OR A PURCHASER WHO IS NOT A U.S. PERSON, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE BANK OF NEW YORK, AS PROPERTY TRUSTEE, SUCH CERTIFICATIONS OR OTHER INFORMATION AS DPL INC. MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED J-1 AFTER THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE CAPITAL SECURITIES EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT OR SUCH EARLIER TIME AS A TRANSFER OF SUCH CAPITAL SECURITIES IS MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT. J-2 EX-4 6 e431330v1.txt EXHIBIT 4(D) EXHIBIT 4(D) EXCHANGE AND REGISTRATION RIGHTS AGREEMENT Dated as of August 24, 2001 by and among DPL INC., DPL CAPITAL TRUST II and MORGAN STANLEY & CO. INCORPORATED, as Initial Purchaser THIS EXCHANGE AND REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT") is made and entered into as of August 24, 2001 by and among DPL INC., an Ohio corporation (the "COMPANY"), DPL CAPITAL TRUST II, a statutory business trust formed under the laws of the state of Delaware (the "TRUST"), and MORGAN STANLEY & CO. INCORPORATED (the "INITIAL PURCHASER"). This Agreement is made pursuant to the Purchase Agreement dated August 24, 2001 (the "PURCHASE Agreement"), by and among the Company, as issuer of the 8 1/8% Junior Subordinated Deferrable Interest Debentures due September 1, 2031 (the "SUBORDINATED DEBENTURES"), the Trust and the Initial Purchaser, which provides for, among other things, the sale by the Trust to the Initial Purchaser of 300,000 of the Trust's 8 1/8% Capital Securities (Liquidation Amount $1,000 per Capital Security) (the "CAPITAL SECURITIES"), the proceeds of which will be used by the Trust, together with the proceeds from the sale of the Trust's common securities to the Company, to purchase the Subordinated Debentures. The Capital Securities, together with the Subordinated Debentures and the Company's guarantee agreement in respect of the Capital Securities (the "CAPITAL SECURITIES GUARANTEE"), are collectively referred to as the "SECURITIES." In order to induce the Initial Purchaser to enter into the Purchase Agreement, the Company and the Trust have agreed to provide to the Initial Purchaser and each Holder (as defined below) the registration rights set forth in this Agreement. In consideration of the foregoing, the parties hereto agree as follows: 1. Definitions. As used in this Agreement, the following capitalized ----------- defined terms shall have the following meanings: "ADVICE" shall have the meaning set forth in SECTION 3(T)(D) hereof. "AFFILIATE" shall have the same meaning as given to that term in Rule 405 under the Securities Act or any successor rule thereunder. "APPLICABLE PERIOD" shall have the meaning set forth in SECTION 3(T) hereof. "BUSINESS DAY" shall mean any day other than a Saturday, a Sunday, or a day on which banking institutions in New York, New York or Wilmington, Delaware are authorized or required by law or executive order to remain closed. "COMPANY" shall have the meaning set forth in the preamble to this Agreement. "DEBENTURES" shall collectively mean the Subordinated Debentures and the Exchange Debentures. "DEPOSITARY" shall mean The Depository Trust Company, or any other depositary appointed by the Trust or the Company; provided, however, that such depositary must have an address in the Borough of Manhattan, in The City of New York. "EFFECTIVENESS PERIOD" shall have the meaning set forth in SECTION 2(B) hereof. "ELIGIBLE HOLDER" shall have the meaning set forth in SECTION 2(A)(I) hereof. "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended and in effect from time to time. "EXCHANGE OFFER" shall mean the offer by the Company and the Trust to the Holders to exchange all of the Registrable Securities for a like amount of Exchange Securities pursuant to SECTION 2(A) hereof. "EXCHANGE OFFER REGISTRATION" shall mean a registration under the Securities Act effected pursuant to SECTION 2(A) hereof. "EXCHANGE OFFER REGISTRATION STATEMENT" shall mean an exchange offer registration statement on Form S-4 (or, if applicable, on another appropriate form), and all amendments and supplements to such registration statement, in each case including the Prospectus to be contained therein, all exhibits thereto and all documents incorporated by reference therein. "EXCHANGE PERIOD" shall have the meaning set forth in SECTION 2(A)(II)(B) hereof. "EXCHANGE SECURITIES" shall mean (i) with respect to the Subordinated Debentures, the Company's 8 1/8% Junior Subordinated Deferrable Interest Debentures due September 1, 2031 (the "EXCHANGE DEBENTURES") containing terms substantially identical to the Subordinated Debentures (except that they will not contain terms with respect to the transfer restrictions under the Securities Act and will not provide for any registration rights or Special Interest to be payable with respect thereto), (ii) with respect to the Capital Securities, the Trust's 8 1/8% Capital Securities (Liquidation Amount $1,000 per Capital Security) (the "EXCHANGE CAPITAL SECURITIES") containing terms substantially identical to the Capital Securities (except they will not contain terms with respect to transfer restrictions under the Securities Act and will not provide for any registration rights or Special Distributions to be payable with respect thereto) and (iii) with respect to the Capital Securities Guarantee, the Company's guarantee agreement in respect of the Exchange Capital Securities (the "EXCHANGE CAPITAL SECURITIES GUARANTEE") containing terms substantially identical to the Capital Securities Guarantee. "HOLDER" shall mean the Initial Purchaser, for so long as it owns any Registrable Securities, and each of its successors, assigns and direct and indirect transferees who become registered holders of, or owners of beneficial interests in, Registrable Securities under the Indenture or the Trust Agreement. "INDENTURE" shall mean the Indenture relating to the Subordinated Debentures and the Exchange Debentures, dated as of August 31, 2001, between the Company, as issuer, and The Bank of New York, as trustee, as amended by that certain First Supplemental Indenture dated as of August 31, 2001 and as the same may be amended from time to time in accordance with the terms thereof. "INITIAL PURCHASER" shall have the meaning set forth in the preamble to this Agreement. 2 "INSPECTORS" shall have the meaning set forth in SECTION 3(N) hereof. "ISSUE DATE" shall mean August 31, 2001, the date of original issuance of the Securities. "MAJORITY HOLDERS" shall mean the Holders of a majority of the aggregate liquidation amount of outstanding Capital Securities or, in the event the trust is liquidated and Subordinated Debentures are distributed, a majority of the aggregate principal amount of the Subordinated Debentures. "NOTICE" shall have the meaning set forth in SECTION 2(A)(II)(A) hereof. "PARTICIPATING BROKER-DEALER" shall have the meaning set forth in SECTION 3(T) hereof. "PERSON" shall mean an individual, partnership, corporation, trust or unincorporated organization, limited liability company or a government or agency or political subdivision thereof. "PROSPECTUS" shall mean the prospectus included in a Registration Statement, including any preliminary prospectus, and any such prospectus as amended or supplemented by any prospectus supplement, including a prospectus supplement with respect to the terms of the offering of any portion of the Registrable Securities covered by a Shelf Registration Statement, and by all other amendments and supplements to a prospectus, including post-effective amendments, and in each case including all documents incorporated by reference therein. "PURCHASE AGREEMENT" shall have the meaning set forth in the preamble to this Agreement. "RECORDS" shall have the meaning set forth in SECTION 3(N) hereof. "REGISTRABLE SECURITIES" shall mean the Securities; provided, however, that Securities shall cease to be Registrable Securities when (i) a Registration Statement with respect to such Securities for the exchange or resale thereof, as the case may be, has been declared effective under the Securities Act and such Securities have been disposed of pursuant to such Registration Statement, (ii) such Securities have been sold to the public pursuant to Rule 144(k) (or any similar provision then in force, but not Rule 144A) under the Securities Act or are eligible to be sold without restriction as contemplated by Rule 144(k), (iii) such Securities have ceased to be outstanding or (iv) such Securities shall have been exchanged for Exchange Securities upon consummation of the Exchange Offer and are thereafter freely tradeable by the holder thereof (other than an Affiliate of the Company). "REGISTRATION EXPENSES" shall mean any and all expenses incident to performance of or compliance by the Company with this Agreement, including without limitation: (i) all SEC or National Association of Securities Dealers, Inc. (the "NASD") registration and filing fees, including, if applicable, the fees and expenses of any "qualified independent underwriter" (and its counsel) that is required to be retained by any Holder of Registrable Securities in accordance with the rules and regulations of the NASD, (ii) all fees and expenses incurred in connection with compliance with state securities or blue sky laws (including reasonable fees and disbursements of counsel for any underwriters or Holders in connection with blue sky qualification of any of the 3 Exchange Securities or Registrable Securities) and compliance with the rules of the NASD, in an amount not exceeding $15,000 in the aggregate, (iii) all expenses of any Persons in preparing or assisting in preparing, word processing, printing and distributing any Registration Statement, any Prospectus and any amendments or supplements thereto, and in preparing or assisting in preparing, printing and distributing any Registration Statement, any Prospectus and any amendments or supplements thereto, and in preparing or assisting in preparing, printing and distributing any underwriting agreements, securities sales agreements and other documents relating to the performance of and compliance with this Agreement, (iv) all rating agency fees, (v) the fees and disbursements of counsel for the Company, of Pillsbury Winthrop LLP, as counsel for the Holders hereunder in connection with the Exchange Offer, and of the independent certified public accountants of the Company, including the expenses of any "cold comfort" letters required by or incident to the performance of and compliance with this Agreement, (vi) the reasonable fees and expenses of the Trustees and their counsel and any exchange agent or custodian, (vii) all fees and expenses incurred in connection with the listing, if any, of any of the Registrable Securities or the Exchange Securities on any securities exchange or exchanges and (viii) the reasonable fees and expenses of any special experts retained by the Company in connection with any Registration Statement. "REGISTRATION STATEMENT" shall mean any registration statement of the Company and the Trust which covers any of the Exchange Securities or Registrable Securities pursuant to the provisions of this Agreement, and all amendments and supplements to such Registration Statement, including post-effective amendments, in each case including the Prospectus contained therein, all exhibits thereto and all documents incorporated by reference therein. "RULE 144(K) PERIOD" shall mean the period of two years (or such shorter period as may hereafter be provided in Rule 144(k) under the Securities Act (or similar successor rule)) commencing on the Issue Date. "SEC" shall mean the Securities and Exchange Commission. "SECURITIES" shall have the meaning set forth in the preamble to this Agreement. "SECURITIES ACT" shall mean the Securities Act of 1933, as amended and in effect from time to time. "SHELF REGISTRATION" shall mean a registration effected pursuant to SECTION 2(B) hereof. "SHELF REGISTRATION EVENT" shall have the meaning set forth in SECTION 2(B) hereof. "SHELF REGISTRATION EVENT DATE" shall have the meaning set forth in SECTION 2(B) hereof. "SHELF REGISTRATION STATEMENT" shall mean a "shelf" registration statement of the Company and the Trust pursuant to the provisions of SECTION 2(B) hereof which covers all of the Registrable Securities on an appropriate form under Rule 415 under the Securities Act, or any similar rule that may be adopted by the SEC, and all amendments and supplements to such registration statement, including post-effective amendments, in each case including the Prospectus contained therein, all exhibits thereto and all documents incorporated by reference therein. 4 "SPECIAL DISTRIBUTIONS" shall have the meaning set forth in SECTION 2(E) hereof. "SPECIAL INTEREST" shall have the meaning set forth in SECTION 2(E) hereof. "TIA" shall mean the Trust Indenture Act of 1939, as amended and in effect from time to time. "TRUST AGREEMENT" shall mean the Amended and Restated Trust Agreement of DPL Capital Trust II, dated as of August 31, 2001, among the trustees named therein and the Company as depositor. "TRUSTEES" shall mean any and all trustees under the Trust Agreement, the Indenture, the Capital Securities Guarantee or the Exchange Capital Securities Guarantee. 2. Registration under the Securities Act. (a) Exchange Offer. (i) To the ------------------------------------- -------------- extent not prohibited by any applicable law or applicable interpretation of the staff of the SEC, the Company and the Trust shall, for the benefit of the Holders, at the Company's cost, use their reasonable best efforts to (A) prepare and cause to be filed with the SEC not later than 120 days after the Issue Date, an Exchange Offer Registration Statement on an appropriate form under the Securities Act relating to the Exchange Offer, (B) cause such Exchange Offer Registration Statement to be declared effective under the Securities Act by the SEC not later than 180 days after the Issue Date and (C) keep such Exchange Offer Registration Statement effective for not less than 30 calendar days (or longer if required by applicable law, and in any event through the Exchange Period) after the date the Notice of the Exchange Offer is mailed to the Holders. Upon the effectiveness of the Exchange Offer Registration Statement, the Company and the Trust shall promptly commence the Exchange Offer, it being the objective of such Exchange Offer to enable each Holder so electing to exchange Registrable Securities for a like principal amount of Exchange Debentures or a like liquidation amount of Exchange Capital Securities, together with the Exchange Capital Securities Guarantee, as applicable (assuming that such Holder is not an Affiliate of the Trust or the Company and is not a broker-dealer tendering Registrable Securities acquired directly from the Trust or the Company for its own account, acquires the Exchange Securities in the ordinary course of such Holder's business and has no arrangements or understandings with any Person to participate in the Exchange Offer for the purpose of distributing the Exchange Securities and is not otherwise prohibited by any law or policy of the SEC from participating in the Exchange Offer) (any Holder meeting all such requirements, hereinafter an "ELIGIBLE Holder"), and to transfer such Exchange Securities from and after their receipt without any limitations or restrictions under the Securities Act and under state securities or blue sky laws. (ii) In connection with the Exchange Offer, the Company and the Trust shall: (A) mail to each Holder a copy of the Prospectus forming part of the Exchange Offer Registration Statement, together with an appropriate letter of transmittal and related documents (together, the "NOTICE"); (B) use its reasonable best efforts to keep the Exchange Offer open for acceptance for a period of not less than 30 calendar 5 days after the date the Notice thereof is mailed to the Holders (or longer if required by applicable law) (such period referred to herein as the "EXCHANGE PERIOD"); (C) utilize the services of the Depositary for the Exchange Offer; (D) permit Holders to withdraw at any time prior to the close of business, New York time, on the last Business Day of the Exchange Period, any Securities tendered for exchange by sending to the institution specified in the Notice, a telegram, telex, facsimile transmission or letter, received the before aforesaid time, setting forth the name of such Holder, the amount of Securities delivered for exchange and a statement that such Holder is withdrawing his election to have such Securities exchanged; (E) notify each Holder by means of the Notice that any Security not tendered by such Holder in the Exchange Offer will remain outstanding and continue to accrue interest or accumulate distributions, as the case may be, but will not retain any rights under this Agreement (except as provided herein); and (F) otherwise comply in all respects with all applicable laws relating to the Exchange Offer. (iii) As soon as practicable after the close of the Exchange Offer, the Company and the Trust, as the case requires, shall: (A) accept for exchange all Securities or portions thereof tendered and not validly withdrawn pursuant to the Exchange Offer; (B) deliver, or cause to be delivered, to the applicable Trustee for cancellation all Securities or portions thereof so accepted for exchange by the Company and the Trust; and (C) issue, and cause the applicable Trustee under the Indenture or the Trust Agreement, as applicable, to promptly authenticate and deliver to each Holder, new Exchange Securities equal in principal amount to the principal amount of the Subordinated Debentures or equal in liquidation amount to the liquidation amount of the Capital Securities, as applicable, as are surrendered by such Holder, and will execute, and cause the applicable Trustee to execute, the Exchange Capital Securities Guarantee. (iv) Distributions on each Exchange Capital Security and interest on each Exchange Debenture issued pursuant to the Exchange Offer will accumulate or accrue from the last date on which distributions or interest was paid on the Capital Security or the Subordinated Debenture surrendered in exchange therefor or, if no distributions or interest has been paid on such Capital Security or Subordinated Debenture, from the Issue Date. To the extent not prohibited by any law or applicable interpretation of the staff of the SEC, the Company and the Trust shall use their reasonable best efforts to complete the Exchange Offer as provided above, and shall comply with the applicable requirements of the Securities Act, the Exchange Act and other applicable laws in connection with the Exchange Offer. The Exchange Offer shall not be subject to any conditions 6 other than that the Exchange Offer does not violate applicable law or any applicable interpretation of the staff of the SEC and that each Holder tendering Securities for exchange shall be an Eligible Holder. Each Holder of Registrable Securities who wishes to exchange such Registrable Securities for Exchange Securities in the Exchange Offer will be required to make certain customary representations in connection therewith, including, in the case of any Holder of Capital Securities, representations that (A) it is not an Affiliate of the Trust or the Company, (B) it is not a broker-dealer tendering Registrable Securities acquired directly from the Trust or Company, (C) the Exchange Securities to be received by it will be acquired in the ordinary course of its business and (D) at the time of the Exchange Offer, it has no arrangements or understandings with any Person to participate in the distribution (within the meaning of the Securities Act) of the Exchange Securities. The Company and the Trust shall inform the Initial Purchaser, after consultation with the applicable Trustees, of the names and addresses of the Holders to whom the Exchange Offer is made, and the Initial Purchaser shall have the right to contact such Holders in order to facilitate the tender of Registrable Securities in the Exchange Offer. Each Holder hereby acknowledges and agrees that any Participating Broker-Dealer and any such Holder using the Exchange Offer to participate in a distribution of the Exchange Securities: (1) could not under SEC policy as in effect on the date of this Agreement rely on the position of the SEC enunciated in Morgan Stanley and Co., Inc. (available June 5, 1991) and Exxon Capital Holdings Corporation (available May 13, 1988), as interpreted in the SEC's letter to Shearman & Sterling dated July 2, 1993, and similar no-action letters (including any no-action letter obtained based on the representations in clause (A) above) and (2) must comply with the registration and prospectus delivery requirements of the Securities Act in connection with the secondary resale transaction and that such a secondary resale transaction should be covered by an effective registration statement containing the selling security holder information required by Item 507 and 508, as applicable, of Regulation S-K under the Securities Act, if the resales are of Exchange Securities obtained by such Holder in exchange for Securities acquired by such Holder directly from the Company. (v) Upon consummation of the Exchange Offer in accordance with this SECTION 2(A), the provisions of this Agreement shall continue to apply, mutatis mutandis, solely with respect to Registrable Securities that are Exchange Securities held by Participating Broker-Dealers, and the Company and the Trust shall have no further obligation to register the Registrable Securities (other than pursuant to SECTION 2(B)(III) or SECTION 2(B)(IV)) pursuant to SECTION 2(B) of this Agreement. (b) Shelf Registration. In the event that (i) the Company or the Trust ------------------ is not permitted to effect the Exchange Offer because of any change in law or currently prevailing interpretations of the staff of the SEC, (ii) the Exchange Offer is not consummated within 210 days after the Issue Date, (iii) (1) the Initial Purchaser is not permitted, in the reasonable opinion of Pillsbury Winthrop LLP, pursuant to applicable law or applicable interpretations of the staff of the SEC, to participate in the Exchange Offer and thereby receive securities that are freely tradeable without restriction under the Securities Act and applicable blue sky or state securities laws, (2) the Initial Purchaser requests registration of Registrable Securities held by it and (3) the Initial Purchaser's request is received by the Company no later than the later of (A) the date of filing of the Exchange Offer Registration Statement and (B) 180 days following the Issue Date or (iv) any Holder (other than a Participating Broker-Dealer), in the opinion of counsel to such Holder reasonably acceptable to the Company, is not eligible to participate in the Exchange Offer or in the 7 case of any Holder (other than a Participating Broker-Dealer) that participates in the Exchange Offer, such Holder does not receive freely tradable Exchange Securities on the date of the exchange and any such Holder so requests (any of the events specified in (i), (ii), (iii) or (iv) being a "SHELF REGISTRATION EVENT," and the date of occurrence thereof, the "SHELF REGISTRATION EVENT DATE"), then the Company and the Trust shall promptly deliver to the Holders and the applicable Trustee written notice thereof and, at their cost, file as promptly as practicable after such Shelf Registration Event Date and, in any event, within 45 days after such Shelf Registration Event Date (but no earlier than 120 days after the Issue Date), a Shelf Registration Statement providing for the sale by the Holders of all of the Registrable Securities, and shall use their reasonable best efforts to have such Shelf Registration Statement declared effective by the SEC as soon as practicable; provided, however, that if the Shelf Registration Event is pursuant to clause (iii), the Company may register such Registrable Securities together with the Exchange Offer Registration Statement, filed pursuant to SECTION 2(A), and the requirements as to timing applicable thereto. No Holder of Registrable Securities shall be entitled to include any of its Registrable Securities in any Shelf Registration pursuant to this Agreement unless and until such Holder agrees in writing to be bound by all of the provisions of this Agreement applicable to such Holder and furnishes to the Company and the Trust in writing, within 15 days after receipt of a request therefor, such information as the Company and the Trust may, after conferring with counsel with regard to information relating to Holders that would be required by the SEC to be included in such Shelf Registration Statement or Prospectus included therein, reasonably request for inclusion in any Shelf Registration Statement or Prospectus included therein. Each Holder as to which any Shelf Registration is being effected agrees to promptly furnish to the Company and the Trust all information with respect to such Holder necessary to make the information previously furnished to the Company by such Holder not materially misleading. The Company and the Trust agree to use their reasonable best efforts to keep the Shelf Registration Statement continuously effective and usable for resales for the Rule 144(k) Period (subject to extension pursuant to SECTION 3(T)(D)), or for such shorter period which will terminate when all of the Securities covered by the Shelf Registration Statement have been sold pursuant to the Shelf Registration Statement or cease to be Registrable Securities (the "EFFECTIVENESS PERIOD"). The Company and the Trust shall not permit any securities other than Registrable Securities to be included in the Shelf Registration. The Company and the Trust will, in the event a Shelf Registration Statement is declared effective, provide to each Holder a reasonable number of copies of the Prospectus that is a part of the Shelf Registration Statement and notify each such Holder when the Shelf Registration has become effective. The Company and the Trust further agree, if necessary, to supplement or amend the Shelf Registration Statement, if required by the rules, regulations or instructions applicable to the registration form used by the Company and the Trust for such Shelf Registration Statement or by the Securities Act or by any other rules and regulations thereunder for shelf registrations, and the Company and the Trust agree to furnish to the Holders of Registrable Securities copies of any such supplement or amendment promptly after its being used or filed with the SEC. (c) Expenses. The Company, as issuer of the Subordinated Debentures, -------- shall pay all Registration Expenses in connection with any Registration Statement filed pursuant to SECTION 2(A) or 2(B) hereof and will reimburse the Initial Purchaser for the reasonable fees and disbursements of Pillsbury Winthrop LLP, counsel for the Initial Purchaser, incurred in connection with the 8 Exchange Offer and either Pillsbury Winthrop LLP or any other single counsel designated in writing by the Majority Holders to act as counsel for the Holders of the Registrable Securities in connection with a Shelf Registration Statement, which other counsel shall be reasonably satisfactory to the Company. Except as provided herein, each Holder shall pay all expenses of its counsel, underwriting discounts and commissions and transfer taxes, if any, relating to the sale or disposition of such Holder's Registrable Securities pursuant to the Shelf Registration Statement. (d) Effective Registration Statement. An Exchange Offer Registration -------------------------------- Statement pursuant to SECTION 2(A) hereof or a Shelf Registration Statement pursuant to SECTION 2(B) hereof (or a combination of the two) will not be deemed to have become effective unless it has been declared effective by the SEC; provided, however, that if, after it has been declared effective, the offering of Registrable Securities pursuant to such Exchange Offer Registration Statement or Shelf Registration Statement is interfered with by any stop order, injunction or other order or requirement of the SEC or any other governmental agency or court, such Exchange Offer Registration Statement or Shelf Registration Statement will be deemed not to have been effective during the period of such interference, until the offering of Registrable Securities pursuant to such Registration Statement may legally resume. The Company and the Trust will be deemed not to have used their reasonable best efforts to cause the Exchange Offer Registration Statement or the Shelf Registration Statement, as the case may be, to become, or to remain, effective during the requisite period if either of them voluntarily takes any action that would result in any such Registration Statement not being declared effective or that would result in the Holders of Registrable Securities covered thereby not being able to exchange or offer and sell such Registrable Securities during that period, unless such action is required by applicable law. (e) Special Interest and Special Distributions. If the Company or the ------------------------------------------ Trust fails to comply with this Exchange and Registration Rights Agreement or if the Exchange Offer Registration Statement or the Shelf Registration Statement fails to become or remain effective as required by this Exchange and Registration Rights Agreement, then, as liquidated damages, Special Interest and Special Distributions (each as defined below) shall become payable as follows: (i) if the Exchange Offer Registration Statement is not filed with the SEC on or prior to the 120th day after the Issue Date or, notwithstanding that the Company and Trust have consummated or will consummate an Exchange Offer, the Company and the Trust are required to file a Shelf Registration Statement and such Shelf Registration Statement is not filed on or prior to the date required by SECTION 2(B) hereof, then, commencing on the day after the applicable required filing date, additional interest ("SPECIAL INTEREST") shall accrue on the principal amount of the Subordinated Debentures, and additional distributions ("SPECIAL DISTRIBUTIONS") shall accumulate on the liquidation amount of the Trust Securities (as such term is defined in the Trust Agreement), each at a rate of .25% per annum; and (ii) if (A) the Exchange Offer Registration Statement is not declared effective by the SEC on or prior to the 180th day after the Issue Date or (B) whether or not the Company and the Trust have consummated or will consummate an Exchange Offer, the Company and Trust are required to 9 file a Shelf Registration Statement and such Shelf Registration Statement is not declared effective by the SEC on or prior to the 60th day after the date such Shelf Registration Statement was required to be filed, then, commencing on the 181st day after the Issue Date or the 61st day after the applicable required filing date, as the case may be, Special Interest shall accrue on the principal amount of the Subordinated Debentures, and Special Distributions shall accumulate on the liquidation amount of the Trust Securities, each at a rate of .25% per annum; and (iii) (A) if the Trust has not exchanged Exchange Capital Securities for the Capital Securities or the Company has not exchanged Exchange Debentures for the Subordinated Debentures, in each case, validly tendered during the Exchange Period, or executed the Exchange Capital Securities Guarantee in respect of the Exchange Capital Securities, in accordance with the terms of the Exchange Offer, on or prior to the 210th day after the Issue Date or (B) during any time an Exchange Offer Registration Statement or a Shelf Registration Statement ceases to be effective as described in SECTION 2(D), then Special Interest shall accrue on the principal amount of Subordinated Debentures, and Special Distributions shall accumulate on the liquidation amount of the Trust Securities, each at a rate of .25% per annum, commencing on the 211th day after the Issue Date, in the case of (A) above, or the day such Registration Statement ceases to be effective, in the case of (B) above; provided, however, that neither the Special Interest rate on the Subordinated Debentures, nor the Special Distribution rate on the Trust Securities, may exceed in the aggregate .50% per annum; provided, further, however, that (1) upon the filing of the applicable Registration Statement (in the case of clause (i) above), (2) upon the effectiveness of the Exchange Offer Registration Statement or a Shelf Registration Statement (in the case of clause (ii) above), (3) upon the exchange of Exchange Capital Securities and Exchange Debentures for all Capital Securities and Subordinated Debentures validly tendered and execution of the Exchange Capital Securities Guarantee (in the case of clause (iii)(A) above), or upon the effectiveness of any Registration Statement that had ceased to remain effective (in the case of clause (iii)(B) above), or (4) upon the expiration of the Rule 144(k) Period, Special Interest on the principal amount of the Subordinated Debentures and Special Distributions on the liquidation amount of the Trust Securities as a result of such clause (or the relevant subclause thereof) shall cease to accrue and accumulate, as the case may be. Any amounts of Special Interest and Special Distributions due pursuant to SECTION 2(E)(I), (II) or (III) above will be payable in cash on the relevant payment dates for the payment of interest and distributions pursuant to the Indenture and the Trust Agreement, respectively. (f) Specific Enforcement. Without limiting the remedies available to -------------------- the Holders, the Company and the Trust acknowledge that any failure by the Company or the Trust to comply with its obligations under SECTION 2(A) and SECTION 2(B) hereof may result in material irreparable injury to the Holders for which there is no adequate remedy at law, that it would not be possible to measure damages for such injuries precisely and that, in the event of any such failure, any Holder may obtain such relief as may be required to specifically enforce the Company's and the Trust's obligations under SECTION 2(A) and SECTION 2(B) hereof. 10 (g) Distribution of Subordinated Debentures. Notwithstanding any other --------------------------------------- provisions of this Agreement, in the event that Subordinated Debentures are distributed to holders of Capital Securities in liquidation of the Trust pursuant to the Trust Agreement, (i) all references in this SECTION 2 and in SECTION 3 to Securities, Registrable Securities and Exchange Securities shall not include the Capital Securities and Capital Securities Guarantee or the Exchange Capital Securities and Exchange Capital Securities Guarantee issued or to be issued in exchange therefor in the Exchange Offer and (ii) all requirements for any action to be taken by the Trust in this SECTION 2 and in SECTION 3 shall cease to apply and all requirements for any action to be taken by the Company in this SECTION 2 and in SECTION 3 shall apply to the Subordinated Debentures and Exchange Debentures issued or to be issued in exchange therefor in the Exchange Offer. 3. Registration Procedures. In connection with the obligations of the ----------------------- Company and the Trust with respect to the Registration Statements pursuant to SECTIONS 2(A) and 2(B) hereof, the Company and the Trust shall: (a) prepare and file with the SEC a Registration Statement or Registration Statements as prescribed by SECTIONS 2(A) and 2(B) hereof within the relevant time period specified in SECTION 2 hereof on the appropriate form under the Securities Act, which form (i) shall be selected by the Company and the Trust, (ii) shall, in the case of a Shelf Registration, be available for the sale of the Registrable Securities by the selling Holders thereof and, in the case of an Exchange Offer, be available for the exchange of Registrable Securities and (iii) shall comply as to form in all material respects with the requirements of the applicable form and include or incorporate by reference all financial statements required by the SEC to be filed therewith; and use their reasonable best efforts to cause such Registration Statement to become effective and remain effective (and, in the case of a Shelf Registration Statement, usable for resales) in accordance with SECTION 2 hereof; provided, however, that if (1) such filing is pursuant to SECTION 2(B), or (2) a Prospectus contained in an Exchange Offer Registration Statement filed pursuant to SECTION 2(A) is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Securities, before filing any Registration Statement or Prospectus or any amendments or supplements thereto, the Company and the Trust shall furnish to and afford the Holders of the Registrable Securities and each such Participating Broker-Dealer, as the case may be, covered by such Registration Statement, their counsel and the managing underwriters, if any, a reasonable opportunity to review copies of all such documents (including copies of any documents to be incorporated by reference therein and all exhibits thereto) proposed to be filed. The Company and the Trust shall not file any Registration Statement or Prospectus or any amendments or supplements thereto in respect of which the Holders must be afforded an opportunity to review prior to the filing of such document if the Majority Holders or such Participating Broker-Dealer, as the case may be, their counsel or the managing underwriters, if any, reasonably object; (b) prepare and file with the SEC such amendments and post-effective amendments to each Registration Statement as may be necessary to keep such Registration Statement effective for the Effectiveness Period or the Applicable Period, as the case may be, and cause each Prospectus to be supplemented, if so determined by the Company or the Trust or requested by the SEC, by any required prospectus supplement and as so supplemented to be filed pursuant to Rule 424 (or any similar provision then in force) under the Securities Act, and comply 11 with the provisions of the Securities Act, the Exchange Act and the rules and regulations promulgated thereunder applicable to it with respect to the disposition of all securities covered by each Registration Statement during the Effectiveness Period or the Applicable Period, as the case may be, in accordance with the intended method or methods of distribution by the selling Holders thereof described in this Agreement (including sales by any Participating Broker-Dealer); (c) in the case of a Shelf Registration, (i) notify each Holder of Registrable Securities included in the Shelf Registration Statement, at least three Business Days prior to filing, that a Shelf Registration Statement with respect to the Registrable Securities is being filed and advise such Holder that the distribution of Registrable Securities will be made in accordance with the method selected by the Majority Holders, (ii) furnish to each Holder of Registrable Securities included in the Shelf Registration Statement and to each underwriter of an underwritten offering of Registrable Securities, if any, without charge, as many copies of each Prospectus, including each preliminary prospectus, and any amendment or supplement thereto, and such other documents as such Holder or underwriter may reasonably request, in order to facilitate the public sale or other disposition of the Registrable Securities, (iii) consent to the use of the Prospectus or any amendment or supplement thereto by each of the selling Holders of Registrable Securities included in the Shelf Registration Statement in connection with the offering and sale of the Registrable Securities covered by the Prospectus or any amendment or supplement thereto, (iv) after the effective time of the Shelf Registration Statement, promptly upon the request of any holder of Registrable Securities that is not then identified therein as a selling securityholder, take any action reasonably necessary to enable such Holder to use the Prospectus forming a part thereof for resales of Registrable Securities, including, without limitation, any action necessary to identify such Holder as a selling securityholder in the Shelf Registration Statement, provided, however, that nothing in this clause (iv) shall relieve any such Holder of the obligation to return a completed and signed questionnaire to the Company in accordance with the terms hereof and (v) furnish to each Holder of Registrable Securities upon request, a copy of this Agreement or, if so requested, a summary thereof if requested by any such Holder; (d) in the case of a Shelf Registration, register or qualify the Registrable Securities under all applicable state securities or "blue sky" laws of such jurisdictions of the United States by the time the applicable Registration Statement is declared effective by the SEC as any Holder of Registrable Securities covered by a Registration Statement and each underwriter of an underwritten offering of Registrable Securities shall reasonably request in writing in advance of such date of effectiveness, and do any and all other acts and things that may be reasonably necessary or advisable to enable such Holder and underwriter to legally consummate the disposition in each such jurisdiction of such Registrable Securities owned by such Holder; provided, however, that the Company and the Trust shall not be required to (i) qualify as a foreign corporation or as a dealer in securities in any jurisdiction where it would not otherwise be required to qualify but for this SECTION 3(D) or (ii) file any general consent to service of process in any jurisdiction where it would not otherwise be subject to such service of process; (e) (1) in the case of a Shelf Registration or (2) in the event that Participating Broker-Dealers from whom the Company or the Trust has received 12 prior written notice that they will be utilizing the Prospectus contained in the Exchange Offer Registration Statement as provided in SECTION 3(T) hereof are seeking to sell Exchange Securities and are required to deliver Prospectuses, promptly notify each Holder of Registrable Securities, or each such Participating Broker-Dealer, as the case may be, their counsel and the managing underwriters, if any, and promptly confirm such notice in writing (i) when a Registration Statement has become effective and when any post-effective amendments and supplements thereto become effective, (ii) of any request by the SEC or any state securities authority for amendments and supplements to a Registration Statement or Prospectus or for additional information after the Registration Statement has become effective, (iii) of the issuance by the SEC or any state securities authority of any stop order suspending the effectiveness of a Registration Statement or the qualification of the Registrable Securities or the Exchange Securities to be offered or sold by any Participating Broker-Dealer in any jurisdiction described in SECTION 3(D) hereof or the initiation of any proceedings for that purpose, (iv) in the case of a Shelf Registration, if, between the effective date of a Registration Statement and the closing of any sale of Registrable Securities covered thereby, the representations and warranties of the Company and the Trust contained in any purchase agreement, securities sales agreement, or any underwriting agreement entered into as described in SECTION 3(M), cease to be true and correct in all material respects, (v) of the happening of any event or the failure of any event to occur or the discovery of any facts or otherwise, (A) which makes any statement made in such Registration Statement untrue in any material respect or which causes such Registration Statement to omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case, as of the time such Registration Statement became effective or (B) which makes any statement made in a Prospectus untrue in any material respect or which causes such Prospectus to omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances then existing, not misleading, in each case, as of the date of such Prospectus or as of any date on which a Prospectus is delivered at any time that the related Registration Statement is required to be effective and (vi) when the Company or the Trust reasonably determine that a post-effective amendment to the Registration Statement would be appropriate; (f) make every reasonable effort to obtain the withdrawal of any order suspending the effectiveness of a Registration Statement at the earliest possible moment; (g) in the case of a Shelf Registration, furnish to each Holder of Registrable Securities included within the coverage of such Shelf Registration Statement, without charge, at least one conformed copy of each Registration Statement relating to such Shelf Registration and any post-effective amendment thereto (including all financial statements and schedules, and, if so requested, documents incorporated therein by reference or exhibits thereto); (h) in the case of a Shelf Registration, cooperate with the selling Holders of Registrable Securities to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be sold and not bearing any restrictive legends and in such denominations (consistent with the provisions of the Indenture and the Trust Agreement) and registered in such names as the selling Holders or the underwriters may reasonably request at least two Business Days prior to the closing of any sale of Registrable Securities pursuant to such Shelf Registration Statement; 13 (i) in the case of a Shelf Registration or an Exchange Offer Registration, promptly after the occurrence of any event specified in SECTION 3(E)(II), 3(E)(III), 3(E)(V) or 3(E)(VI) hereof, prepare a supplement or post-effective amendment to such Registration Statement or the related Prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter delivered to the purchasers of the Registrable Securities, such Prospectus 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 then existing, not misleading; and notify each Holder to suspend use of the Prospectus as promptly as practicable after the occurrence of such an event, and each Holder hereby agrees to suspend use of the Prospectus until the Company has amended or supplemented the Prospectus to correct such misstatement or omission; (j) in the case of a Shelf Registration, a reasonable time prior to the filing of any document which is to be incorporated by reference into a Registration Statement or a Prospectus after the initial filing of a Registration Statement, provide a reasonable number of copies of such document to the Holders; and make such of the representatives of the Company and the Trust as shall be reasonably requested by the Holders of Registrable Securities or the Initial Purchaser on behalf of such Holders available for reasonable discussion of such document; (k) obtain a CUSIP number for all Exchange Capital Securities (and, if the Trust has made a distribution of the Subordinated Debentures to the Holders of the Capital Securities, the Exchange Debentures), no later than the effective date of a Registration Statement, and provide the applicable Trustee with printed certificates for the Exchange Securities or the Registrable Securities, as the case may be, in a form eligible for deposit with the Depositary; (l) cause the Indenture, the Trust Agreement, the Capital Securities Guarantee (in the case of a Shelf Registration) and the Exchange Capital Securities Guarantee (in the case of an Exchange Offer Registration) to be qualified under the TIA in connection with the registration of the Exchange Securities or the Registrable Securities, as the case may be, and effect such changes to such documents as may be required for them to be so qualified in accordance with the terms of the TIA and execute, and use its reasonable best efforts to cause the applicable Trustee to execute, all documents as may be required to effect such changes, and all other forms and documents required to be filed with the SEC to enable such documents to be so qualified in a timely manner; (m) in the case of a Shelf Registration, enter into such agreements (including underwriting agreements) as are customary in underwritten offerings and consistent with the terms of the Purchase Agreement and take all such other appropriate actions in connection therewith as are reasonably requested in order to expedite or facilitate the registration or the disposition of the Registrable Securities, and in such connection, whether or not an underwriting agreement is entered into and whether or not the registration is with respect to an underwritten offering, if requested by (x) the Initial Purchaser, in the case where the Initial Purchaser holds Securities acquired by it as part of its initial distribution and (y) other Holders of Registrable Securities covered thereby: (i) make such representations and warranties to Holders of such Registrable Securities and the underwriters (if any), with respect to the 14 business of the Trust, the Company and the subsidiaries of the Company as then conducted and the Registration Statement, Prospectus and documents, if any, incorporated or deemed to be incorporated by reference therein, in each case, as are customarily made by issuers to underwriters in underwritten offerings, and confirm the same if and when requested; (ii) obtain opinions of counsel to the Company and the Trust and updates thereof (which may be in the form of a reliance letter) in form and substance reasonably satisfactory to the managing underwriters (if any) and the Holders of a majority in aggregate principal or liquidation amount, as the case may be, of the Registrable Securities being sold, addressed to each selling Holder and the underwriters (if any) covering the matters customarily covered in opinions requested in underwritten offerings and such other matters as may be reasonably requested by such underwriters (it being agreed that the matters to be covered by such opinions may be subject to customary qualifications and exceptions); (iii) obtain "cold comfort" letters and updates thereof in form and substance reasonably satisfactory to the managing underwriters (if any) from the independent certified public accountants of the Company and the Trust (and, if necessary, any other independent certified public accountants of any subsidiary of the Company or any business acquired by the Company or the Trust for which financial statements and financial data are, or are required to be, included in the Registration Statement), addressed to each of the underwriters, such letters to be in customary form and covering matters of the type customarily covered in "cold comfort" letters in connection with underwritten offerings and such other matters as reasonably requested by such underwriters in accordance with Statement on Auditing Standards No. 72; and (iv) if an underwriting agreement is entered into, to cause said underwriting agreement to contain indemnification provisions and procedures no less favorable than those set forth in SECTION 4 hereof (or such other provisions and procedures acceptable to Holders of a majority in aggregate principal amount of Registrable Securities covered by such Registration Statement and the managing underwriters or agents) with respect to all parties to be indemnified pursuant to said Section, including, without limitation, such underwriters and selling Holders (the above shall be done at each closing under such underwriting agreement or, as and to the extent required thereunder and consistent with the terms of the Purchase Agreement); (n) if (1) a Shelf Registration is filed pursuant to SECTION 2(B) or (2) a Prospectus contained in an Exchange Offer Registration Statement filed pursuant to SECTION 2(A) is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Securities during the Applicable Period, make reasonably available for inspection by any selling Holder of such Registrable Securities being sold, or each such Participating Broker-Dealer, as the case may be, any underwriter participating in any such disposition of Registrable Securities, if any, and any attorney, accountant or other agent retained by any such selling Holder or each such Participating Broker-Dealer, as the case may be, or underwriter (collectively, the "INSPECTORS"), at the offices where normally kept, during reasonable business hours, all financial and other records, pertinent corporate documents and properties of the Trust, the Company and its subsidiaries (collectively, the "RECORDS") as shall be reasonably necessary to enable them to exercise any applicable due diligence responsibilities, and cause the officers, directors and employees of the Trust, the Company and its subsidiaries to supply all relevant information in each case reasonably requested by any such Inspector in connection with such Registration Statement; provided, however, that the foregoing inspection and information gathering shall be coordinated on behalf of all such parties by the Company's designated Holders' counsel, at the expense of such parties as described in SECTION 2(C) hereof. Records of the Company, the Trust and the Company's subsidiaries which the Company or the Trust, as the case 15 may be, determines in good faith to be confidential and any Records which it notifies the Inspectors are confidential shall not be disclosed by the Inspectors unless (i) the disclosure of such Records is necessary to avoid or correct a material misstatement or omission in such Registration Statement; provided that the Company or the Trust, as the case may be, shall be consulted prior to any such disclosure, (ii) the release of such Records is ordered pursuant to a subpoena or other order from a court of competent jurisdiction or is necessary in connection with any action, suit or proceeding or (iii) the information in such Records has been made available to the public. Each selling Holder of such Registrable Securities and each such Participating Broker-Dealer will be required to agree in writing that information obtained by it or any Inspector retained by it as a result of such inspections shall be deemed confidential and shall not be used by it or any Inspector retained by it as the basis for any market transactions in the securities of the Company or the Trust unless and until such is made generally available to the public. Each selling Holder of such Registrable Securities and each such Participating Broker-Dealer will be required to further agree in writing that it will, upon learning that disclosure of such Records is sought in a court of competent jurisdiction, give notice to the Company and the Trust and allow the Company and the Trust (at their expense) to undertake appropriate action to prevent disclosure of the Records deemed confidential; (o) comply with all applicable rules and regulations of the SEC so long as any provision of this Agreement is applicable and make generally available to its securityholders earning statements satisfying the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar rule promulgated under the Securities Act) no later than 60 days after the end of any 12-month period (or 120 days after the end of any 12-month period if such period is a fiscal year) (i) commencing at the end of any fiscal quarter in which Registrable Securities are sold to underwriters in a firm commitment or best efforts underwritten offering and (ii) if not sold to underwriters in such an offering, commencing on the first day of the first fiscal quarter of the Company after the effective date of a Registration Statement, which statements shall cover said 12 month periods; (p) upon consummation of an Exchange Offer, if requested by a Trustee, obtain (i) an opinion of counsel (or reliance letter) to the Company addressed to the Trustee for the benefit of all Holders of Registrable Securities participating in the Exchange Offer which restates the opinions delivered pursuant to the Purchase Agreement (with such changes as are customary to address the Registration Statement and the transfer of the registered Exchange Securities) and which, without limitation, includes an opinion substantially to the effect that (A) each of the Company and the Trust, as the case requires, has duly authorized, executed and delivered the Exchange Securities, (B) each of the Exchange Securities constitutes a validly issued, fully paid and nonassessable undivided beneficial ownership interest in the assets of the Trust (in the case of an Exchange Capital Security) or a legal, valid and binding obligation of the Company, enforceable against the Company, in accordance with its respective terms (in the case of an Exchange Debenture and the Exchange Capital Securities Guarantee), as the case may be (in each case, with customary exceptions) and (C) each of the Indenture, the Trust Agreement and the Exchange Capital Securities Guarantee has been duly qualified under the TIA or no such qualification is required by the TIA and (ii) a comfort letter of the type described in SECTION 3(M)(III); 16 (q) if an Exchange Offer is to be consummated, upon delivery of the Registrable Securities by Holders to the Company or the Trust, as applicable (or to such other Person as directed by the Company or the Trust, respectively), in exchange for the Exchange Securities, the Company or the Trust, as applicable, shall mark, or cause to be marked, on such Registrable Securities delivered by such Holders that such Registrable Securities are being canceled in exchange for the Exchange Securities; it being understood that in no event shall such Registrable Securities be marked as paid or otherwise satisfied; (r) cooperate with each seller of Registrable Securities covered by any Registration Statement and each underwriter, if any, participating in the disposition of such Registrable Securities and their respective counsel in connection with any filings required to be made with the NASD; (s) use its reasonable best efforts to take all other steps necessary to effect the registration of the Registrable Securities covered by a Registration Statement contemplated hereby; (t) (A) in the case of the Exchange Offer Registration Statement (i) (a) indicate in a "Plan of Distribution" section contained in the Prospectus contained in the Exchange Offer Registration Statement that any broker or dealer registered under the Exchange Act who holds Securities that are Registrable Securities and that were acquired for its own account as a result of market-making activities or other trading activities (other than Registrable Securities acquired directly from the Company) (such broker or dealer, a "PARTICIPATING BROKER-DEALER"), may exchange such Securities pursuant to the Exchange Offer; however, such Participating Broker-Dealer may be deemed to be an "underwriter" within the meaning of the Securities Act and must, therefore, deliver a prospectus meeting the requirements of the Securities Act in connection with any resales of the Exchange Securities received by such Participating Broker-Dealer in the Exchange Offer, which prospectus delivery requirement may be satisfied by the delivery by such Participating Broker-Dealer of the Prospectus contained in the Exchange Offer Registration Statement and (b) include in such "Plan of Distribution" section all other information with respect to such resales by Participating Broker-Dealers that the SEC may require in order to permit such resales pursuant thereto, but such "Plan of Distribution" shall not name any such Participating Broker-Dealer or disclose the amount of Exchange Securities held by any such Participating Broker-Dealer except to the extent required by the Commission as a result of a change in policy announced after the date of this Agreement, (ii) furnish to each Participating Broker-Dealer who has delivered to the Company the notice referred to in SECTION 3(E), without charge, as many copies of each Prospectus included in the Exchange Offer Registration Statement, including any preliminary Prospectus, and any amendment or supplement thereto, as such Participating Broker-Dealer may reasonably request (each of the Company and the Trust hereby consents to the use of the Prospectus forming part of the Exchange Offer Registration Statement or any amendment or supplement thereto by any Person subject to the prospectus delivery requirements of the Securities Act, including all Participating Broker-Dealers, in connection with the sale or transfer of the Exchange Securities covered by the Prospectus or any amendment or supplement thereto), (iii) use their reasonable best efforts to keep the Exchange Offer Registration Statement effective and to amend and supplement the Prospectus contained therein in order to permit such Prospectus to be lawfully delivered by all Persons subject to the prospectus delivery requirements of the Securities Act for such period of time as such Persons must comply with such requirements 17 under the Securities Act and applicable rules and regulations in order to resell the Exchange Securities; provided, however, that such period shall not be required to exceed 90 days (or such longer period if extended pursuant to the last sentence of SECTION 3(T)(D) hereof) (the "APPLICABLE PERIOD") and (iv) include in the transmittal letter or similar documentation to be executed by an exchange offeree in order to participate in the Exchange Offer (x) the following provision: "If the exchange offeree is a broker-dealer holding Registrable Securities acquired for its own account as a result of market-making activities or other trading activities, it is required to deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of Exchange Securities received in respect of such Registrable Securities pursuant to the Exchange Offer"; and (y) a statement to the effect that, by a Participating Broker-Dealer making the acknowledgment described in clause (x) and by delivering a Prospectus in connection with the exchange of Registrable Securities, the Participating Broker-Dealer will not be deemed to admit that it is an underwriter within the meaning of the Securities Act; (B) in the case of any Exchange Offer Registration Statement, the Company and the Trust agree to deliver to the Initial Purchaser or to another representative of the Participating Broker-Dealers, if requested by the Initial Purchaser or such other representative of Participating Broker-Dealers, on behalf of the Participating Broker-Dealers upon consummation of the Exchange Offer and (in the case of clause (iii) below) upon the effectiveness of the Exchange Offer Registration Statement; (i) an opinion of counsel in form and substance reasonably satisfactory to the Initial Purchaser or such other representative of the Participating Broker-Dealers, covering the matters customarily covered in opinions requested in connection with Exchange Offer Registration Statements and such other matters as may be reasonably requested (it being agreed that the matters to be covered by such opinion may be subject to customary qualifications and exceptions), (ii) an officer's certificate containing certifications substantially similar to those set forth in certificates delivered pursuant to Section 6(f) of the Purchase Agreement and such additional certifications as are customarily delivered in a public offering of debt securities and (iii) a comfort letter, in each case, in customary form as permitted by Statement on Auditing Standards No. 72 (each of the foregoing shall be consistent with the terms of the Purchase Agreement); (C) The Company or the Trust may require each seller of Registrable Securities as to which any registration is being effected to furnish to the Company or the Trust, as applicable, such information regarding such seller as may be required by the staff of the SEC to be included in a Registration Statement. The Company or the Trust may exclude from such registration the Registrable Securities of any seller who unreasonably fails to furnish such information within a reasonable time after receiving such request. The Company shall not have any obligation to register under the Securities Act the Registrable Securities of a seller who so fails to furnish such information. (D) (1) In the case of a Shelf Registration Statement, or (2) in the event that Participating Broker-Dealers have notified the Company and the 18 Trust that they will be utilizing the Prospectus contained in the Exchange Offer Registration Statement as provided in this SECTION 3(T) hereof and are seeking to sell Exchange Securities and are required to deliver Prospectuses, each Holder agrees that, upon receipt of any notice from the Company or the Trust of the occurrence of any event specified in SECTION 3(E)(II), 3(E)(III), 3(E)(V) or 3(E)(VI) hereof, such Holder will forthwith discontinue disposition of Registrable Securities pursuant to a Registration Statement until such Holder's receipt of the copies of the supplemented or amended Prospectus contemplated by SECTION 3(I) hereof or until it is advised in writing (the "ADVICE") by the Company and the Trust that the use of the applicable Prospectus may be resumed, and, if so directed by the Company and the Trust, such Holder will deliver to the Company or the Trust (at the Company's or the Trust's expense, as the case requires) all copies in such Holder's possession, other than permanent file copies then in such Holder's possession, of the Prospectus covering such Registrable Securities or Exchange Securities, as the case may be, current at the time of receipt of such notice. If the Company or the Trust shall give any such notice to suspend the disposition of Registrable Securities or Exchange Securities, as the case may be, pursuant to a Registration Statement, the Company and the Trust shall use their best efforts to file and have declared effective (if an amendment) as soon as practicable an amendment or supplement to the Registration Statement and shall extend the period during which such Registration Statement shall be maintained effective and usable for resales pursuant to this Agreement by the number of days in the period from and including the date of the giving of such notice to and including the date when the Company and the Trust shall have made available to the Holders (x) copies of the supplemented or amended Prospectus necessary to resume such dispositions or (y) the Advice; (u) In the event that any broker-dealer registered under the Exchange Act underwrites any Registrable Securities or participates as a member of an underwriting syndicate or selling group or "assists in the distribution" (within the meaning of the Conduct Rules (the "RULES") of the NASD) thereof, whether as a Holder of such Registrable Securities or as an underwriter, a placement or sales agent or a broker or dealer in respect thereof, or otherwise, the Company will assist such broker-dealer in complying with the requirements of such Rules, including, without limitation, by (i) if such Rules, including Rule 2720, so require, engaging a "qualified independent underwriter" (as defined in Rule 2720) to participate in the preparation of the Registration Statement relating to such Registrable Securities, to exercise usual standards of due diligence in respect thereto and, if any portion of the offering contemplated by such Registration Statement is an underwritten offering or is made through a placement or sales agent, to recommend the yield of any Exchange Debentures or Exchange Capital Securities, (ii) indemnifying any such qualified independent underwriter to the extent of the indemnification of underwriters provided in SECTION 4 hereof and (iii) providing such information to such broker-dealer as may be required in order for such broker-dealer to comply with the requirements of the Rules. 4. Indemnification and Contribution. (a) In connection with any -------------------------------- Registration Statement, the Company and the Trust shall, jointly and severally, indemnify and hold harmless each Holder of the Registrable Securities or Exchange Securities, any Participating Broker-Dealer (and its partners, directors and officers) and each person, if any, who controls such Holder or such Participating Broker-Dealer (and its partners, directors and officers) within the meaning of the Securities Act or the Exchange Act (each Holder, any Participating Broker-Dealer and such controlling persons are referred to collectively as the "INDEMNIFIED PARTIES") from and against any losses, claims, damages or liabilities, joint or several, or any actions in respect thereof 19 (including, but not limited to, any losses, claims, damages, liabilities or actions relating to purchases and sales of the Registrable Securities or Exchange Securities) to which each such Indemnified Party may become subject under the Securities Act, the Exchange Act or otherwise, insofar as such losses, claims, damages, liabilities or actions arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in a Registration Statement or Prospectus or in any amendment or supplement thereto or in any preliminary prospectus relating to a Shelf Registration, or arise out of, or are based upon, the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and shall reimburse, as incurred, each Indemnified Party for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action in respect thereof; provided, however, that (i) neither the Company nor the Trust shall be liable to a Holder in any such case to the extent that such loss, claim, damage or liability arises out of or is based upon any untrue statement or alleged untrue statement or omission or alleged omission made in a Registration Statement or Prospectus or in any amendment or supplement thereto or in any preliminary prospectus relating to a Shelf Registration in reliance upon and in conformity with written information pertaining to such Holder and furnished to the Company or the Trust by or on behalf of such Holder expressly for inclusion therein and (ii) with respect to any untrue statement or omission or alleged untrue statement or omission made in any preliminary prospectus relating to a Shelf Registration Statement, the indemnity agreement contained in this subsection (a) shall not inure to the benefit of any Holder or Participating Broker-Dealer from whom the person asserting any such losses, claims, damages or liabilities purchased the Registrable Securities or Exchange Securities concerned, to the extent that a prospectus relating to such Registrable Securities or Exchange Securities was required to be delivered by such Holder or Participating Broker-Dealer under the Securities Act in connection with such purchase and any such loss, claim, damage or liability of such Holder or Participating Broker-Dealer results from the fact that there was not sent or given to such person, at or prior to the written confirmation of the sale of such Registrable Securities or Exchange Securities to such person, a copy of the final prospectus if the Company or the Trust had previously furnished copies thereof to such Holder or Participating Broker-Dealer; provided further, however, that this indemnity agreement will be in addition to any liability which the Company or the Trust may otherwise have to such Indemnified Party. Each of the Company and the Trust, jointly and severally, shall also indemnify underwriters, their partners, officers and directors and each person who controls such underwriters within the meaning of the Securities Act or the Exchange Act to the same extent as provided above with respect to the indemnification of the Holders of the Registrable Securities or Exchange Securities if requested by such Holders. (b) Each Holder of the Registrable Securities or Exchange Securities, severally and not jointly, will indemnify and hold harmless the Company and the Trust and each person, if any, who controls the Company or the Trust within the meaning of the Securities Act or the Exchange Act from and against any losses, claims, damages or liabilities or any actions in respect thereof, to which the Company, the Trust or any such controlling person may become subject under the Securities Act, the Exchange Act or otherwise, insofar as such losses, claims, damages, liabilities or actions arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in a Registration Statement or prospectus or in any amendment or supplement thereto or in any preliminary prospectus relating to a Shelf Registration, or arise out of or are based upon the omission or alleged omission to state therein a 20 material fact necessary to make the statements therein not misleading, but in each case only to the extent that the untrue statement or omission or alleged untrue statement or omission was made in reliance upon and in conformity with written information pertaining to such Holder and furnished to the Company or the Trust by or on behalf of such Holder expressly for inclusion therein; and, subject to the limitation set forth immediately preceding this clause, shall reimburse, as incurred, the Company or the Trust for any legal or other expenses reasonably incurred by the Company or the Trust or any such controlling person in connection with investigating or defending any loss, claim, damage, liability or action in respect thereof. This indemnity agreement will be in addition to any liability which such Holder may otherwise have to the Company, the Trust or any of its controlling persons. (c) Promptly after receipt by an indemnified party under this SECTION 4 of notice of the commencement of any action or proceeding (including a governmental investigation), such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this SECTION 4, notify the indemnifying party of the commencement thereof; but the omission so to notify the indemnifying party will not, in any event, relieve the indemnifying party from any obligations to any indemnified party other than to the extent the indemnifying party is prejudiced thereby, and in any event shall not relieve it from liability that it may have otherwise on account of this indemnity agreement. In case any such action is brought against any indemnified party, and it notifies the indemnifying party of the commencement thereof, the indemnifying party will be entitled to participate therein and, to the extent that it may wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof the indemnifying party will not be liable to such indemnified party under this SECTION 4 for any legal or other expenses, other than reasonable costs of investigation, subsequently incurred by such indemnified party in connection with the defense thereof. The indemnifying party shall not be liable for any settlement of any action effected without its consent, but if any such action is settled with the consent of the indemnifying party or if there be a final judgment for the plaintiff in any such action, the indemnifying party agrees to indemnify and hold harmless the indemnified party from and against any loss or liability by reason of such settlement or judgment. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened action in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party unless such settlement includes an unconditional release of such indemnified party from all liability on any claims that are the subject matter of such action, and does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party. (d) If the indemnification provided for in this SECTION 4 is unavailable or insufficient to hold harmless an indemnified party under subsections (a) or (b) above, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to in subsection (a) or (b) above in such proportion as is appropriate to reflect the relative fault of the indemnifying party or parties on the one hand and the indemnified party on the other in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities (or actions in 21 respect thereof) as well as any other relevant equitable considerations. The parties hereto agree that it would not be just and equitable if contributions pursuant to this SECTION 4(D) were determined by pro rata allocation (even if the Holders or any agents or underwriters or all of them were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in this SECTION 4(D). The relative fault of the parties 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 or the Trust on the one hand or such Holder or such other indemnified party, as the case may be, on the other, and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any action or claim which is the subject of this subsection (d). Notwithstanding any other provision of this SECTION 4(D), the Holders of the Registrable Securities or Exchange Securities shall not be required to contribute any amount in excess of the amount by which the net proceeds received by such Holders from the sale of the Registrable Securities or Exchange Securities pursuant to a Registration Statement exceeds the amount of damages which such Holders have 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 Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this paragraph (d), each person, if any, who controls such indemnified party within the meaning of the Securities Act or the Exchange Act shall have the same rights to contribution as such indemnified party and each person, if any, who controls the Company or the Trust within the meaning of the Securities Act or the Exchange Act shall have the same rights to contribution as the Company or the Trust. (e) The agreements contained in this SECTION 4 shall survive the sale of the Registrable Securities or Exchange Securities pursuant to a Registration Statement and shall remain in full force and effect, regardless of any termination or cancellation of this Agreement or any investigation made by or on behalf of any indemnified party. (f) The remedies provided for in this SECTION 4 are not exclusive and shall not limit any rights or remedies that may otherwise be available to any indemnified party at law or in equity. 5. Participation In an Underwritten Registration. No Holder may participate --------------------------------------------- in any underwritten registration hereunder unless such Holder (a) agrees to sell such Holder's Registrable Securities on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve such arrangements and (b) completes and executes all reasonable questionnaires, powers of attorney, indemnities, underwriting agreements, lock-up letters and other documents reasonably required under the terms of such underwriting arrangements. 6. Selection of Underwriters. The Holders of Registrable Securities covered ------------------------- by the Shelf Registration Statement who desire to do so may sell the securities 22 covered by such Shelf Registration in an underwritten offering, subject to the provisions of SECTION 3(M) hereof. In any such underwritten offering, the underwriter or underwriters and manager or managers that will administer the offering will be selected by the Holders of a majority in aggregate principal or liquidation amount, as applicable, of the Registrable Securities included in such offering; provided, however, that such underwriters and managers must be reasonably satisfactory to the Company and the Trust. 7. Miscellaneous. (a) Rule 144 and Rule 144A. For so long as either of the ------------- ---------------------- Company and the Trust is subject to the reporting requirements of Section 13 or 15 of the Exchange Act, any Registrable Securities remain outstanding and to the extent required by Rule 144(k), each of the Company and the Trust will file the reports required to be filed by it under the Securities Act and Section 13(a) or 15(d) of the Exchange Act and the rules and regulations adopted by the SEC thereunder; provided, however, that if the Company or the Trust ceases to be so required to file such reports, each will, upon the request of any Holder of Registrable Securities (a) make publicly available such information as is necessary to permit sales of the Registrable Securities pursuant to Rule 144 under the Securities Act, (b) deliver such information to prospective purchasers as is necessary to permit sales of the Registrable Securities pursuant to Rule 144A under the Securities Act and take such further action as any Holder of Registrable Securities may reasonably request and (c) take such further action that is reasonable in the circumstances, in each case, to the extent required from time to time to enable such Holder to sell its Registrable Securities without registration under the Securities Act within the limitation of the exemptions provided by (i) Rule 144 under the Securities Act, as such rule may be amended from time to time, (ii) Rule 144A under the Securities Act, as such rule may be amended from time to time or (iii) any similar rules or regulations hereafter adopted by the SEC. Upon the request of any Holder of Registrable Securities, each of the Company and the Trust will deliver to such Holder a written statement as to whether it has complied with such requirements. Without limiting the foregoing, the Company will provide a copy of this Agreement upon request to any purchaser or prospective purchaser of Registrable Securities. (b) No Inconsistent Agreements. Neither the Company nor the Trust has -------------------------- entered into, nor will the Company or the Trust on or after the date of this Agreement enter into, any agreement that is inconsistent with the rights granted to the Holders of Registrable Securities in this Agreement or that otherwise conflicts with the provisions hereof. The rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights granted to the holders of the Company's or the Trust's other issued and outstanding securities under any such agreements. (c) Amendments and Waivers. The provisions of this Agreement, including ---------------------- the provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given without the written consent of Holders of a majority in aggregate principal or liquidation amount of the outstanding Registrable Securities affected by such amendment, modification, supplement, waiver or departure; provided that no amendment, modification or supplement or waiver or consent to the departure with respect to the provisions of SECTION 4 hereof shall be effective as against any Holder of Registrable Securities unless consented to in writing by such Holder. Notwithstanding the foregoing sentence, (i) this Agreement may be amended, without the consent of any Holder of Registrable Securities, by written agreement signed by the Company, the Trust and the 23 Initial Purchaser, to cure any ambiguity, correct or supplement any provision of this Agreement that may be defective or inconsistent with any other provision of this Agreement or to make any other provisions with respect to matters or questions arising under this Agreement which shall not be inconsistent with other provisions of this Agreement and shall not adversely affect the interests of the Holders in any material respect, (ii) without the consent of any Holder of Registrable Securities, this Agreement may be amended, modified or supplemented, and waivers and consents to departures from the provisions hereof may be given, by written agreement signed by the Company, the Trust and the Initial Purchaser to the extent that any such amendment, modification, supplement, waiver or consent is, in their reasonable judgment, necessary or appropriate to comply with applicable law (including any interpretation of the staff of the SEC) or any change therein and (iii) to the extent any provision of this Agreement relates to the Initial Purchaser but not to any other Holder, such provision may be amended, modified or supplemented, and waivers or consents to departures from such provisions may be given, by written agreement signed by the Initial Purchaser, the Company and the Trust. Each Holder of Registrable Securities shall be bound by any amendment or waiver effected pursuant to this SECTION 7(C), whether or not any notice, writing or marking indicating such amendment or waiver appears on such security or is delivered to such Holder. (d) Notices. All notices and other communications provided for or ------- permitted hereunder shall be made in writing by hand-delivery, registered first-class mail, telecopier or any courier guaranteeing overnight delivery (i) if to a Holder, at the most current address given by such Holder to the Company or the Trust by means of a notice given in accordance with the provisions of this SECTION 7(D), or in the absence of such notice, as specified in the Trust Agreement, which address initially is, with respect to the Initial Purchaser, the address set forth in the Purchase Agreement and (ii) if to the Company or the Trust, initially at the Company's address set forth in the Purchase Agreement and thereafter at such other address, notice of which is given in accordance with the provisions of this SECTION 7(D). All such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt is acknowledged, if telecopied; and on the next Business Day, if timely delivered to an air courier guaranteeing overnight delivery. Copies of all such notices, demands or other communications shall be concurrently delivered by the Person giving the same to the applicable Trustee, at the address specified in the Trust Agreement or Indenture, as the case may be. (e) Successors and Assigns. This Agreement shall inure to the benefit ---------------------- of and be binding upon the successors, assigns and transferees of the Initial Purchaser, including, without limitation and without the need for an express assignment, subsequent Holders, the Company and the Trust; provided, however, that nothing herein shall be deemed to permit any assignment, transfer or other disposition of Registrable Securities in violation of the terms of the Purchase Agreement, the Trust Agreement or the Indenture. If any transferee of any Holder acquires Registrable Securities in any manner, whether by operation of law or otherwise, such Registrable Securities shall be held subject to all of the terms of this Agreement, and by taking and holding such Registrable Securities, such Person shall be conclusively deemed to have agreed to be bound by and to perform 24 all of the terms and provisions of this Agreement and such Person shall be entitled to receive the benefits hereof. (f) Third Party Beneficiaries. Each Holder and any Participating ------------------------- Broker-Dealer shall be a third party beneficiary of the agreements made hereunder among the Initial Purchaser, the Company and the Trust, and the Initial Purchaser shall have the right to enforce such agreements directly to the extent it deems such enforcement necessary or advisable to protect its rights or the rights of Holders hereunder. (g) Consent to Jurisdiction; Appointment of Agent to Accept Service of ------------------------------------------------------------------ Process. Each of the Company and the Trust irrevocably submits to the - ------- non-exclusive jurisdiction of any federal or state court in the City, County and State of New York, United States of America, in any legal suit, action or proceeding based on or arising under this Agreement and agrees that all claims in respect of such suit or proceeding may be determined in any such court. Each of the Company and the Trust irrevocably waives the defense of an inconvenient forum or objections to personal jurisdiction with respect to the maintenance of such legal suit, action or proceeding. Each of the Company and the Trust has appointed Thelen Reid & Priest LLP (the "PROCESS AGENT") as its authorized agent upon whom process may be served in any such legal suit, action or proceeding. Such appointment shall be revocable by serving written notice on the applicable Trustee under the Trust Agreement or Indenture, as the case may be, of the appointment of a subsequent Process Agent by the Company or the Trust, as the case may be, and the effectiveness of such appointment. The Process Agent has agreed to act as said agent for service of process and agrees to take any and all action including the filing of any and all documents and instruments that may be necessary to continue such appointment in full force and effect as aforesaid. Each of the Company and the Trust further agrees that service of process upon the Process Agent and written notice of said service to the Company or the Trust, as the case may be, shall be deemed in every respect effective service of process upon the Company or the Trust, as the case may be, in any such legal suit, action or proceeding. Nothing herein shall affect the right of the Initial Purchaser or any person controlling the Initial Purchaser to serve process in any other manner permitted by law. The provisions of this subsection (g) shall remain operative and in full force and effect regardless of any termination of this Agreement, in whole or in part. (h) Counterparts; Facsimile. This Agreement may be executed in any ----------------------- number of counterparts and by the parties hereto in separate counterparts, and signature pages may be delivered by facsimile, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. (i) Headings. The headings in this Agreement are for convenience of -------- reference only and shall not limit or otherwise affect the meaning hereof. (j) Governing Law. THIS AGREEMENT SHALL BE DEEMED TO HAVE BEEN MADE IN ------------- THE STATE OF NEW YORK. THE TERMS AND CONDITIONS SET FORTH HEREIN SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO ANY PROVISIONS RELATING TO CONFLICTS OF LAWS. 25 (k) Severability. In the event that any one or more of the provisions ------------ contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be affected or impaired thereby. (l) Securities Held By the Company, the Trust or Its Affiliates. ----------------------------------------------------------- Whenever the consent or approval of Holders of a specified percentage of Registrable Securities is required hereunder, Registrable Securities held by the Company, the Trust or any Affiliates shall not be counted in determining whether such consent or approval was given by the Holders of such required percentage. 26 IN WITNESS WHEREOF, the parties have executed this Exchange and Registration Rights Agreement as of the date first written above. DPL INC. By: /s/ Elizabeth M. McCarthy ------------------------------------ Name: Elizabeth M. McCarthy Title: Vice President and Chief Financial Officer DPL CAPITAL TRUST II By: /s/ Stephen F. Koziar ------------------------------------ Name: Stephen F. Koziar Title: Administrative Trustee MORGAN STANLEY & CO. INCORPORATED By: /s/ Michael Fusco - ------------------------------------ Name: Michael Fusco Title: Executive Director 27 EX-4 7 e431341v1.txt EXHIBIT 4(E) EXHIBIT 4(E) Registered NUMBER R-1 $309,300,000 DPL INC. FORM OF 8 1/8% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURE DUE SEPTEMBER 1, 2031 Dated: , 2002 ------ -- Registered Holder: THE BANK OF NEW YORK, AS PROPERTY TRUSTEE, ON BEHALF OF DPL CAPITAL TRUST II DPL INC., a corporation duly organized and existing under the laws of the State of Ohio (herein referred to as the "COMPANY," which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to the Registered Holder named above, the principal sum of Three Hundred and Nine Million Three Hundred Thousand Dollars ($309,300,000) on September 1, 2031, in such coin or currency of the United States of America as at the time of payment is legal tender for the payment of public and private debt. The Company further promises to pay to the registered Holder hereof as hereinafter provided (a) interest on said principal sum (subject to deferral as set forth herein) at the rate per annum specified in the title of this debenture (the "DEBENTURE"), in like coin or currency, semiannually in arrears on the 1st day of March and September of each year (each, an "INTEREST PAYMENT DATE") commencing March 1, 2002, from the Interest Payment Date next preceding the date hereof to which interest has been paid or duly provided for (unless (i) no interest has yet been paid or duly provided for on this Debenture, in which case from August 31, 2001, or (ii) the date hereof is before an Interest Payment Date but after the related Record Date (as defined below), in which case from such following Interest Payment Date; provided, however, that if the Company shall default in payment of the interest due on such following Interest Payment Date, then from the next preceding Interest Payment Date to which interest has been paid or duly provided for, until the principal hereof is paid or duly provided for, plus (b) Additional Interest, as defined in the Indenture, to the extent permitted by applicable law, on any interest payment that is not made on the applicable Interest Payment Date, which shall accrue at the rate per annum specified in the title of this Debenture, compounded semiannually. The interest so payable will, subject to certain exceptions provided in the Indenture hereinafter referred to, be paid to the person in whose name this Debenture is registered at the close of business on the Record Date next preceding such Interest Payment Date. The Record Date shall be the Business Day next preceding the Interest Payment Date, unless this Certificate is registered to a holder other than the Property Trustee or a nominee of The Depository Trust Company, in which case the Record Date will be the fifteenth day of the calendar month next preceding the month in which the applicable Interest Payment Date occurs or, if such fifteenth day of the month is not a Business Day, then the Business Day next preceding such day. This Debenture may be presented for payment of principal and interest at the principal corporate trust office of The Bank of New York , as paying agent for the Company, maintained for that purpose in the Borough of Manhattan, The City of New York, State of New York; provided, however, that payment of interest may be made at the option of the Company (i) by check mailed to such address of the 1 person entitled thereto as the address shall appear on the Register of the Debentures or (ii) by transfer to an account maintained by the Person entitled thereto as specified in the Register; provided that proper transfer instructions have been received by the Record Date. Interest on the Debenture will be computed on the basis of a 360-day year of twelve 30-day months (and for any partial periods on the basis of the number of days elapsed in a 360-day year of twelve 30-day months). So long as no Event of Default has occurred and is continuing, the Company shall have the right at any time during the term of this Debenture from time to time to defer payment of interest on this Debenture, for up to ten consecutive semiannual interest payment periods with respect to each deferral period (each an "EXTENSION PERIOD"), during which Extension Periods the Company shall have the right to make partial payments of interest on any Interest Payment Date; provided, however, that no Extension Period shall end on a date other than an Interest Payment Date or extend beyond September 1, 2031 or any earlier redemption date. At the end of each Extension Period, the Company shall pay all interest then accrued and unpaid (together with any Additional Interest thereon to the extent permitted by applicable law, Special Interest, and Additional Tax Sums, if applicable). During any such Extension Period, the Company shall not, and shall cause any Subsidiary of the Company not to, (i) declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of the Company's Capital Stock (which includes Common Stock and preferred stock) or (ii) make any payment of principal of or interest or premium, if any, on or repay, repurchase or redeem any debt securities that rank on a parity with or junior to this Debenture or make any guarantee payments with respect to any DPL Guarantee or other guarantee by the Company that ranks on a parity with or junior to this Debenture (other than (a) dividends or distributions payable in Common Stock, (b) any declaration of a dividend in connection with the implementation of a Rights Plan, the issuance of any Capital Stock or any class or series of preferred stock of the Company under any Rights Plan or the redemption or repurchase of any rights distributed pursuant to a Rights Plan, (c) payments under any DPL Guarantee relating to the Preferred Securities issued by the DPL Trust holding this Debenture, and (d) purchases of Common Stock related to the issuance of Common Stock or rights under any of the Company's benefit plans for its directors, officers, employees, consultants or advisors). Prior to the termination of any such Extension Period, the Company may further extend such Extension Period; provided, however, that no Extension Period shall exceed ten consecutive semiannual periods or extend beyond September 1, 2031 or any earlier prepayment date. At any time following the termination of any Extension Period and the payment of all accrued and unpaid interest (together with any Additional Interest, Special Interest and Additional Tax Sums, if applicable) then due, the Company may elect to begin a new Extension Period, subject to the above requirements. No interest shall be due and payable during an Extension Period except at the end thereof. If the Property Trustee is the only registered holder of the Debentures of this series, the Company shall give written notice to the Property Trustee and the Trustee of its election to begin or extend any Extension Period at least five Business Days prior to the earlier of (i) the next succeeding date on which Distributions on the Capital Securities issued by the relevant DPL Trust would have been payable but for the election to begin or extend such Extension Period or (ii) the date the Administrative Trustees are required to give notice to any securities exchange or other applicable self- regulatory organization or to holders of such Capital Securities of the record date or the date such Distributions are payable, but in any event not less than five Business Days prior to such record date. An Administrative Trustee shall give notice of the Company's election to 2 begin or extend an Extension Period to the holders of such Capital Securities. If the Property Trustee is not the only holder of the Debentures of this series at the time the Company elects to begin or extend an Extension Period, the Company shall give the holders of the Debentures of this series and the Trustee written notice of its election to begin or extend such Extension Period at least ten Business Days prior to the earlier of (i) the next succeeding Interest Payment Date or (ii) the date the Company is required to give notice of the record or payment date of such interest payment to any applicable self-regulatory organization or to holders of the Debentures of this series. This Debenture is issued pursuant to an Indenture, dated as of August 31, 2001, between the Company, as issuer, and The Bank of New York, a New York banking corporation, as trustee, as supplemented by a First Supplemental Indenture dated as of August 31, 2001 (as further supplemented or amended from time to time, the "INDENTURE"). Reference is made to the Indenture for a description of the respective rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the Holders (the word "HOLDER" or "HOLDERS" meaning the registered holder or registered holders) of the Debentures. Capitalized terms used herein but not defined herein shall have the respective meanings assigned thereto in the Indenture. By acceptance of this Debenture, the Holder hereof agrees to be bound by the provisions of the Indenture. The Debentures of this series shall have an initial aggregate principal amount of Three Hundred and Nine Million Three Hundred Thousand Dollars ($309,300,000). The indebtedness of the Company evidenced by this Debenture, including the principal hereof and interest hereon, is, to the extent and in the manner set forth in the Indenture, subordinate and junior in right of payment to the Company's obligations to Holders of Senior Indebtedness of the Company and each Holder of this Debenture, by acceptance hereof, agrees to and shall be bound by such provisions of the Indenture and all other provisions of the Indenture. This Debenture shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed by or on behalf of the Trustee under the Indenture. 3 IN WITNESS WHEREOF, DPL INC. has caused this instrument to be signed, manually or in facsimile, by its Chairman of the Board, or its Chief Executive Officer, or its President or any Vice Chairman, or any Vice President and by its Treasurer or an Assistant Treasurer or its Controller or its Secretary or an Assistant Secretary. DPL INC. By: ____________________________ Name: Title: By: ____________________________ Name: Title: [Seal] TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Securities, of the series designated herein, described in the within-mentioned Indenture. Dated: ______, __, 2002 THE BANK OF NEW YORK, as Trustee By: ____________________________ Authorized Signatory REVERSE OF DEBENTURE As provided in and subject to the provisions of the Indenture, if an Event of Default with respect to the payment of principal or interest on the Debentures of this series or with respect to compliance with certain covenants occurs and is continuing, then either the Trustee or the Holders of not less than 25% in principal amount of the then outstanding Debentures of each series as to which such Event of Default has occurred may declare the principal amount of all the Debentures of such series, together with any accrued interest (including any Additional Interest, Special Interest and Additional Tax Sums), to be due and payable immediately, by a notice in writing to the Company (and to the Trustee, if such notice is given by Holders). If the Debentures have been issued to an DPL Trust, upon such an Event of Default, if the Trustee or the Holders of not less than 25% in principal amount of the outstanding Debentures of this series fails to declare the principal of all the Debentures to be immediately due and payable, the holders of at least 25% in aggregate liquidation amount of the corresponding Capital Securities of such DPL Trust then outstanding shall have such right by a notice in writing to the Company and the Trustee, and upon any such declaration the principal amount of and the accrued interest (including any Additional Interest, Special Interest and Additional Tax Sums) on all the Debentures of such series shall become immediately due and payable; provided that the payment of principal and interest on the Debentures shall remain subordinated to the extent provided in the Indenture. If an Event of Default with respect to certain covenants applicable to all series of securities issued under the Indenture (collectively, the "SECURITIES") occurs and is continuing, then either the Trustee or the Holders of not less than 25% in principal amount of all then outstanding Securities under the Indenture (voting as a single class) may declare the principal amount of all such Securities to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if such notice is given by Holders). If the Securities of a series issued under the Indenture have been issued to an DPL Trust, upon such an Event of Default, if the Trustee and the Holders of not less than 25% in principal amount of all outstanding Securities of that series fail to declare the principal of all the Securities of that series to be immediately due and payable, the holders of at least 25% in aggregate liquidation amount of the corresponding Capital Securities of such DPL Trust then outstanding shall have such right by a notice in writing to the Company and the Trustee; and upon any such declaration the principal amount of and the accrued interest (including any Additional Interest and Special Interest) on all the Securities of that series shall become immediately due and payable; provided that the payment of principal and interest shall remain subordinated to the extent provided in the Indenture. The Indenture provides that in certain events such declaration that principal and accrued interest are due and payable, and the consequences of such declaration, may be rescinded and annulled by the holders of a majority in principal amount of the Securities then outstanding under the Indenture as to which such acceleration of the payment of principal and interest has occurred, voting as one class. In the case of Securities issued under the Indenture to one or more DPL Trusts, should the Holders of such Securities fail to rescind and annul such declaration and its consequences, the Holders of a majority in aggregate liquidation amount of the corresponding Capital Securities of such DPL Trusts shall have such right. The Indenture also provides that the Holders of a majority in principal amount of all of the Securities of all series then outstanding as to which an Event of Default has occurred may, on behalf of all 2 Holders of such Securities, waive any past default under the Indenture other than (a) a default in the payment of the principal of or interest on any of the Securities or (b) a default in respect of a covenant or provision of the Indenture which under the terms of the Indenture cannot be modified or amended without the consent of each Holder of Securities so affected. In the case of Securities of one or more series issued to one or more DPL Trusts, the Indenture provides that the Holders of a majority in aggregate liquidation amount of the corresponding Capital Securities issued by such DPL Trusts shall also have the right to waive such defaults. The Indenture contains provisions permitting the Company and the Trustee, with the consent of the Holders of a majority in principal amount of the outstanding Securities of all affected series (voting as one class), to execute supplemental indentures adding any provisions to or changing or eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying the rights of the holders of the Securities of each such series; provided, however, that no such supplemental indenture shall (i) change the fixed maturity of any Securities, or reduce the rate or extend the time of payment of interest thereon or on any overdue principal amount, or reduce the principal amount thereof, or reduce any amount payable upon any redemption thereof, or make the principal thereof or any interest thereon or on any overdue principal amount payable in any coin or currency other than that herein prescribed, without the consent of the Holder of each security so affected, (ii) reduce the percentage of Securities, the consent of the Holders of which is required for any such supplemental indenture, without the consent of all Holders of Securities then outstanding, (iii) modify certain provisions of the Indenture relating to waiver of compliance with covenants, waiver of defaults or modification of the Indenture without the consent of all Holders of Securities then outstanding, except to increase the percentage of Holders required for such waiver or modification, or (iv) modify the provisions with respect to the subordination of outstanding Securities of any series in a manner adverse to the Holders thereof, without the consent of the Holder of each security so affected; provided, however, that, in the case of the Securities of a series issued to an DPL Trust, so long as any of the corresponding series of Capital Securities issued by such DPL Trust remains outstanding, (i) no such amendment shall be made that adversely affects the holders of such Capital Securities or Preferred Securities in any material respect, and no termination of the Indenture shall occur, and no waiver of any Event of Default with respect to such series or compliance with any covenant with respect to such series under the Indenture shall be effective, without the prior consent of the holders of a majority of the aggregate liquidation amount of such Capital Securities then outstanding, unless and until the principal (and premium, if any) of the Securities of such series and all accrued and unpaid interest (including any Additional Interest) thereon shall have been paid in full and (ii) no amendment shall be made to Section 6.05 of the Base Indenture (regarding the right of Holders of Capital Securities to institute a suit directly against the Company) that would impair the rights of the Holders of Capital Securities provided therein without the prior consent of all Holders of Capital Securities then outstanding, unless and until the principal (and premium, if any) of the Securities of such series and all accrued and unpaid interest (including any Additional Interest) thereon have been paid in full. As provided in and subject to the provisions in the Indenture, the Company shall have the option to redeem the Debentures of this series at any time, in whole but not in part, at the Optional Redemption Price. In addition, if a Special Event shall occur and be continuing, the Company may redeem the Debentures of this series at any time within 90 days after the occurrence of 3 that Special Event, in whole but not in part, at the Special Event Redemption Price. Any consent or waiver by the Holder of this Debenture given as provided in the Indenture (unless effectively revoked as provided in the Indenture) shall be conclusive and binding upon such Holder and upon all future Holders of this Debenture and of any Debenture issued in exchange, registration of transfer, or otherwise in lieu hereof irrespective of whether any notation of such consent or waiver is made upon this Debenture or such other Debentures. No reference herein to the Indenture and no provision of this Debenture or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and interest on this Debenture, at the places, at the respective times, at the 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 Debenture may be registered on the Register of the Debentures of this series upon surrender of this Debenture for registration of transfer at the offices maintained by the Company or its agent for such purpose, duly endorsed by the Holder hereof or his attorney duly authorized in writing, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Securities registrar duly executed by the Holder hereof or his attorney duly authorized in writing, but without payment of any charge other than a sum sufficient to reimburse the Company for any tax or other governmental charge incident thereto. Upon any such registration of transfer, a new Debenture or Debentures of authorized denomination or denominations for the same aggregate principal amount will be issued to the transferee in exchange herefor. Prior to due presentment for registration of transfer of this Debenture, the Company, the Trustee, and any agent of the Company or the Trustee may deem and treat the person in whose name this Debenture shall be registered upon the Register of the Debentures of this series as the absolute owner of this Debenture (whether or not this Debenture shall be overdue and notwithstanding any notation of ownership or other writing hereon) for the purpose of receiving payment of or on account of the principal hereof and, subject to the provisions on the face hereof, interest due hereon and for all other purposes; and neither the Company nor the Trustee nor any such agent shall be affected by any notice to the contrary. No recourse shall be had for the payment of the principal of or interest on this Debenture, or for any claim based hereon or otherwise in respect hereof, or based on or in respect of the Indenture or any indenture supplemental thereto, against any stockholder, officer, director or employee, as such, past, present or future, of the Company or of any successor corporation, either directly or through the Company, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as a part of the consideration for the issue hereof, expressly waived and released. The Company and, by acceptance of this Debenture or a beneficial interest in this Debenture, each holder hereof and any person acquiring a beneficial interest herein, agree that for United States federal, state and local tax purposes it is intended that this Debenture constitute indebtedness. 4 This Debenture shall be deemed to be a contract made under the laws of the State of New York (without regard to conflicts of laws principles thereof) and for all purposes shall be governed by, and construed in accordance with, the laws of said State (including without limitation Section 5-1401 of the New York General Obligations Law or any successor to such statute). 5 EX-4 8 e431343v1.txt EXHIBIT 4(F) EXHIBIT 4(F) FORM OF CAPITAL SECURITY CERTIFICATE This Capital Security is a Global Capital Security within the meaning of the Trust Agreement hereinafter referred to and is registered in the name of The Depository Trust Company (the "DEPOSITORY") or a nominee of the Depository. This Capital Security is exchangeable for Capital Securities registered in the name of a person other than the Depository or its nominee only in the limited circumstances described in the Trust Agreement and no transfer of this Capital Security (other than a transfer of this Capital Security as a whole by the Depository to a nominee of the Depository or by a nominee of the Depository to the Depository or another nominee of the Depository) may be registered except in limited circumstances. Unless this Capital Security is presented by an authorized representative of The Depository Trust Company ("DTC"), a New York corporation (55 Water Street, New York), to DPL Capital Trust II or its agent for registration of transfer, exchange or payment, and any Capital Security issued is registered in the name of Cede & Co. or such other name as is requested by an authorized representative of DTC (and any payment hereon is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. CERTIFICATE NUMBER R-1 CUSIP NO. ----------- ISIN NO. ------------ FORM OF CERTIFICATE EVIDENCING CAPITAL SECURITIES OF DPL CAPITAL TRUST II 8 1/8% CAPITAL SECURITIES (LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY) DPL Capital Trust II, a statutory business trust created under the laws of the State of Delaware (the "TRUST"), hereby certifies that Cede & Co. (the "HOLDER") is the registered owner of the number of Capital Securities of the Trust specified in Schedule I hereto representing an undivided beneficial interest in the assets of the Trust and designated the DPL Capital Trust II 8 1/8% Capital Securities (Liquidation Amount $1,000 per Capital Security) (the "CAPITAL SECURITIES"). The Capital Securities are transferable on the books and records of the Trust, in person or by a duly authorized attorney, upon surrender of this certificate duly endorsed and in proper form for transfer as provided in Section 5.4 of the Trust Agreement (as defined below). The designations, rights, privileges, restrictions, preferences and other terms and provisions of the Capital Securities are set forth in, and this certificate and the Capital Securities represented hereby are issued and shall in all respects be subject to the terms and provisions of, the Amended and Restated Trust Agreement of the Trust dated as of August 31, 2001, as the same may be amended from time to time (the "TRUST AGREEMENT"), including the designation of the terms of Capital Securities as set forth therein. The Holder is entitled to the benefits of the Capital Securities Guarantee Agreement entered into by DPL Inc., an Ohio corporation, and The Bank of New York, as guarantee trustee, dated as of August 31, 2001 (the "GUARANTEE"), to the extent provided therein. The Trust will furnish a copy of the Trust Agreement and the Guarantee to the Holder without charge upon written request to the Trust at its principal place of business or registered office. Upon receipt of this certificate, the Holder is bound by the Trust Agreement and is entitled to the benefits thereunder. By its acceptance of this certificate representing Capital Securities or a beneficial interest in such Capital Securities, the owner of, and any person that acquires a beneficial interest in, such Capital Securities, agrees to treat the Debentures described in the Trust Agreement as indebtedness and the Capital Securities as evidence of indirect beneficial ownership in such indebtedness for tax purposes. 2 In Witness Whereof, one of the Administrative Trustees of the Trust has executed this certificate as of this ___ day of __________, 2002. DPL CAPITAL TRUST II By: ------------------------------------ Name: Administrative Trustee 3 SCHEDULE I GLOBAL SECURITY The initial number of Capital Securities evidenced by this Global Capital Security is 300,000.
CHANGES TO NUMBER OF CAPITAL SECURITIES EVIDENCED BY 144A GLOBAL SECURITY - ----------------------- ------------------------------ ----------------------------- ------------------- Number of Capital Securities by which this Global Capital Security is to be Reduced or Increased, Remaining Capital and Reason for Reduction Securities Represented by Date or Increase this Global Capital Security Notation Made by - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- ------------------- - ----------------------- ------------------------------ ----------------------------- -------------------
4 EX-4 9 e431333v1.txt EXHIBIT 4(G) EXHIBIT 4(G) FORM OF CAPITAL SECURITIES GUARANTEE AGREEMENT THIS CAPITAL SECURITIES GUARANTEE AGREEMENT, dated as of _____________, 2002 (the "GUARANTEE AGREEMENT"), is executed and delivered by DPL Inc., an Ohio corporation (the "GUARANTOR"), and The Bank of New York, a New York banking corporation, as trustee (the "GUARANTEE TRUSTEE"), for the benefit of the Holders (as defined herein) from time to time of the Capital Securities (as defined herein) of DPL Capital Trust II, a Delaware statutory business trust (the "ISSUER"). WHEREAS, pursuant to an Amended and Restated Trust Agreement, dated as of August 31, 2001 (the "TRUST AGREEMENT"), among the Guarantor, as Depositor, the Property Trustee, the Delaware Trustee, the Administrative Trustees named therein and the holders, from time to time, of undivided beneficial interests in the assets of the Issuer, the Issuer is issuing $300,000,000 in initial aggregate Liquidation Amount (as defined in the Trust Agreement) of its 8 1/8% Capital Securities (the "CAPITAL SECURITIES") representing preferred undivided beneficial interests in the assets of the Issuer and having the terms set forth in the Trust Agreement; WHEREAS, the Capital Securities will be issued by the Issuer and the proceeds thereof, together with the proceeds from the issuance of the Issuer's Common Securities (as defined herein), will be used to purchase the Debentures (as defined in the Trust Agreement) of the Guarantor which will be deposited with The Bank of New York, as Property Trustee under the Trust Agreement, as trust assets; and WHEREAS, as incentive for the Holders to purchase Capital Securities, the Guarantor desires irrevocably and unconditionally to agree, to the extent set forth herein, to pay to the Holders of the Capital Securities the Guarantee Payments (as defined herein) and to make certain other payments on the terms and conditions set forth herein. NOW, THEREFORE, in consideration of the purchase by each Holder of Capital Securities, which purchase the Guarantor hereby agrees shall benefit the Guarantor, the Guarantor executes and delivers this Guarantee Agreement for the benefit of the Holders from time to time of the Capital Securities. ARTICLE I DEFINITIONS ----------- Section 1.1 Definitions. As used in this Guarantee Agreement, the terms set ----------- forth below shall, unless the context otherwise requires, have the following meanings. Capitalized or otherwise defined terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Trust Agreement as in effect on the date hereof. "Affiliate" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person; provided, however, that an Affiliate of the Guarantor shall not be deemed to be an Affiliate of the Issuer. For the purposes of this definition, "control" when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing. "Board of Directors" means either the board of directors of the Guarantor or any committee of that board duly authorized to act hereunder. "Capital Securities" means the 8 1/8% Capital Securities (Liquidation Amount $1,000 per Capital Security) of the Issuer. "Common Securities" means the 8 1/8% common securities (Liquidation Amount $1,000 per Common Security) of the Issuer. "Commission" means the Securities and Exchange Commission, as from time to time constituted, created under the Securities Exchange Act of 1934, as amended, or, if at any time after the execution of this instrument such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act of 1939, then the body performing such duties on such date. "Corporate Trust Office" means the office of the Guarantee Trustee at which the corporate trust business of the Guarantee Trustee shall, at any particular time, be principally administered, which office at the date of execution of this Guarantee Agreement is located at 101 Barclay Street, Floor 21 West, New York 10286. "Event of Default" means a default by the Guarantor on any of its payment or other obligations under this Guarantee Agreement; provided, however, that, except with respect to a default in payment of any Guarantee Payments, the Guarantor shall have received notice of default and shall not have cured such default within 60 days after receipt of such notice. "Guarantee Payments" means the following payments or distributions, without duplication, with respect to the Capital Securities, to the extent not paid or made by or on behalf of the Issuer: (i) any accumulated and unpaid Distributions (as defined in the Trust Agreement) required to be paid on the Capital Securities, to the extent the Issuer shall have funds on hand available therefor at such time, (ii) the Redemption Price (as defined in the Trust Agreement) with respect to any Capital Securities called for redemption by the Issuer, to the extent the Issuer shall have funds on hand available therefor at such time, and (iii) upon a voluntary or involuntary termination, dissolution, winding-up or liquidation of the Issuer, unless Debentures are distributed to the Holders, the lesser of (a) the aggregate of the Liquidation Amount of $1,000 per Capital Security plus accumulated and unpaid Distributions on the Capital Securities to but excluding the date of payment, to the extent the Issuer shall have funds on hand available therefor at such time, and (b) the amount of assets of the Issuer 2 remaining available for distribution to Holders in liquidation of the Issuer (in either case, the "LIQUIDATION DISTRIBUTION"). "Guarantee Trustee" means The Bank of New York, until a Successor Guarantee Trustee has been appointed and has accepted such appointment pursuant to the terms of this Guarantee Agreement and thereafter means each such Successor Guarantee Trustee. "Holder" means any holder, as registered on the books and records of the Issuer, of any Capital Securities; provided, however, that in determining whether the holders of the requisite percentage of Capital Securities have given any request, notice, consent or waiver hereunder, "Holder" shall not include the Guarantor, the Guarantee Trustee, or any Affiliate of the Guarantor or the Guarantee Trustee. "Indenture" means the Indenture dated as of August 31, 2001, between the Guarantor and The Bank of New York, as trustee, as supplemented by the First Supplemental Indenture dated August 31, 2001, and as may be further supplemented or amended from time to time. "List of Holders" has the meaning specified in SECTION 2.2(A). "Majority in Liquidation Amount of the Capital Securities" means, except as provided by the Trust Indenture Act, a vote by the Holder(s), voting separately as a class, of more than 50% of the Liquidation Amount of all then outstanding Capital Securities issued by the Issuer. "Officers' Certificate" means, with respect to any Person, a certificate signed by the Chairman of the Board, any Vice Chairman of the Board, the Chief Executive Officer, the President, any Vice Chairman or any Vice President (whether or not designated by a number or a word or words added before or after the title Vice President), and by the Treasurer, an Assistant Treasurer, the Controller, the Secretary or an Assistant Secretary of such Person, and delivered to the Guarantee Trustee. Any Officers' Certificate delivered with respect to compliance with a condition or covenant provided for in this Guarantee Agreement shall include: (a) a statement that each officer signing the Officers' Certificate has read the covenant or condition and the definitions relating thereto; (b) a brief statement of the nature and scope of the examination or investigation undertaken by each officer in rendering the Officers' Certificate; (c) a statement that each officer has made such examination or investigation as, in such officer's opinion, is necessary to enable such officer to express an informed opinion as to whether or not such covenant or condition has been complied with; and (d) a statement as to whether, in the opinion of each such officer, such condition or covenant has been complied with. "Person" means any individual, corporation, estate, partnership, joint venture, association, joint stock company, limited liability company, trust, unincorporated association, or government or any agency or political subdivision thereof, or any other entity of whatever nature. 3 "Responsible Officer" means, with respect to the Guarantee Trustee, any officer of the Guarantee Trustee with direct responsibility for the administration of this Guarantee Agreement and also means, with respect to a particular corporate trust matter, any other officer of the Guarantee Trustee to whom such matter is referred because of that officer's knowledge of and familiarity with the particular subject. "Successor Guarantee Trustee" means a successor Guarantee Trustee possessing the qualifications to act as Guarantee Trustee under SECTION 4.1. "Trust Indenture Act" means the Trust Indenture Act of 1939, as amended. ARTICLE II TRUST INDENTURE ACT ------------------- Section 2.1 Trust Indenture Act; Application. This Guarantee Agreement is -------------------------------- not subject to the provisions of the Trust Indenture Act, but the Guarantee Agreement is intended to comply with the requirements of Sections 310 to 317, inclusive, of the Trust Indenture Act. If and to the extent that any provision of this Guarantee Agreement limits, qualifies or conflicts with the duties imposed by Sections 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties shall control. Section 2.2 List of Holders. (a) The Guarantor shall furnish or cause to be --------------- furnished to the Guarantee Trustee (i) semiannually, not more than five days after March 15 and September 15 of each year, beginning with March 15, 2002, a list, in such form as the Guarantee Trustee may reasonably require, of the names and addresses of the Holders ("LIST OF HOLDERS") as of a date not more than 15 days prior to the delivery thereof, and (ii) at such other times as the Guarantee Trustee may request in writing, within 30 days after the receipt by the Guarantor of any such request, a List of Holders as of a date not more than 15 days prior to the time such list is furnished, in each case to the extent such information is in the possession or control of the Guarantor and is not identical to a previously supplied list of Holders or has not otherwise been received by the Guarantee Trustee in its capacity as such. The Guarantee Trustee may destroy any List of Holders previously given to it on receipt of a new List of Holders. (b) The Guarantee Trustee shall comply with the obligations imposed under Section 311(a), Section 311(b) and Section 312(b) of the Trust Indenture Act as if it were subject to the Trust Indenture Act. Section 2.3 Reports by the Guarantee Trustee. Not later than March 15 of -------------------------------- each year, commencing March 15, 2002, the Guarantee Trustee shall provide to the Holders such reports as are required by Section 313 of the Trust Indenture Act, if any, in the form and in the manner provided by Section 313 of the Trust Indenture Act. The Guarantee Trustee shall also comply with the requirements of Section 313(d) of the Trust Indenture Act. Section 2.4 Periodic Reports to the Guarantee Trustee. The Guarantor shall ----------------------------------------- provide to the Guarantee Trustee and the Holders such documents, reports and information, if any, as required by Section 314(a) of the Trust Indenture Act 4 and the compliance certificate required by Section 314 of the Trust Indenture Act, in the form, in the manner and at the times required by Section 314 of the Trust Indenture Act. Delivery of such reports, information and documents to the Guarantee Trustee is for informational purposes only and the Guarantee Trustee's receipt of such reports, information and documents shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Guarantor's compliance with any of its covenants hereunder (as to which the Guarantee Trustee is entitled to rely exclusively on Officers' Certificates). Section 2.5 Evidence of Compliance with Conditions Precedent. The Guarantor ------------------------------------------------ shall provide to the Guarantee Trustee such evidence of compliance with such conditions precedent, if any, provided for in this Guarantee Agreement that relate to any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any certificate or opinion required to be given by an officer pursuant to Section 314(c)(1) of the Trust Indenture Act shall be given in the form of an Officers' Certificate. Section 2.6 Events of Default; Waiver. The Holders of a Majority in ------------------------- Liquidation Amount of the Capital Securities may, by vote, on behalf of the Holders, waive any past Event of Default and its consequences. Upon such waiver, any such Event of Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Guarantee Agreement, but no such waiver shall extend to any subsequent or other default or Event of Default or impair any right consequent therefrom. Section 2.7 Event of Default; Notice. (a) The Guarantee Trustee shall, ------------------------ within 90 days after the occurrence of an Event of Default, transmit by mail, first-class postage prepaid, to the Holders, notices of all Events of Default actually known to a Responsible Officer of the Guarantee Trustee, unless such defaults have been cured or waived before the giving of such notice; provided that, except in the case of a default in the payment of a Guarantee Payment, the Guarantee Trustee shall be protected in withholding such notice if and so long as the Board of Directors, the executive committee or a trust committee of directors and/or Responsible Officers of the Guarantee Trustee in good faith determines that the withholding of such notice is in the interests of the Holders. (b) The Guarantee Trustee shall not be deemed to have knowledge of any Event of Default unless the Guarantee Trustee shall have received written notice, or a Responsible Officer charged with the administration of this Guarantee Agreement shall have obtained written notice, of such Event of Default at the Corporate Trust Office of the Guarantee Trustee and such notice references this Guarantee Agreement. Section 2.8 Conflicting Interests. The Trust Agreement and the Indenture --------------------- shall be deemed to be specifically described in this Guarantee Agreement for the purposes of clause (i) of the first proviso contained in Section 310(b) of the Trust Indenture Act. In determining whether the Guarantee Trustee has a conflicting interest as defined in Section 310(b) of the Trust Indenture Act with respect to the Securities of any particular series, there shall be excluded this Guarantee Agreement with respect to Securities of any particular series of Securities other than that series. Nothing herein shall prevent the Guarantee Trustee from filing with the Commission the application referred to in the second to last paragraph of Section 310(b) of the Trust Indenture Act. 5 ARTICLE III POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE -------------------------------------------------- Section 3.1 Powers and Duties of the Guarantee Trustee. (a) This Guarantee ------------------------------------------ Agreement shall be held by the Guarantee Trustee for the benefit of the Holders, and the Guarantee Trustee shall not transfer this Guarantee Agreement to any Person except a Holder exercising his or her rights pursuant to SECTION 5.4(IV) or to a Successor Guarantee Trustee on acceptance by such Successor Guarantee Trustee of its appointment to act as Successor Guarantee Trustee. The right, title and interest of the Guarantee Trustee shall automatically vest in any Successor Guarantee Trustee, upon acceptance by such Successor Guarantee Trustee of its appointment hereunder, and such vesting in the Successor Guarantee Trustee and cessation of right, title and interest with respect to the Guarantee Trustee shall be effective whether or not conveyancing documents have been executed and delivered pursuant to the appointment of such Successor Guarantee Trustee. If and when required by the Guarantee Exchange and Registration Rights Agreement, the Guarantee Trustee shall enter into the Exchange Guarantee Agreement and shall effect the exchange contemplated therein. (b) If an Event of Default has occurred and is continuing, the Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of the Holders, subject to the second sentence in (c) below. (c) The Guarantee Trustee, before the occurrence of any Event of Default and after the curing or waiving of all Events of Default that may have occurred, shall undertake to perform only such duties as are specifically set forth in this Guarantee Agreement, and no implied covenants shall be read into this Guarantee Agreement against the Guarantee Trustee. In case an Event of Default has occurred (that has not been cured or waived pursuant to SECTION 2.6), the Guarantee Trustee shall exercise such of the rights and powers vested in it by this Guarantee Agreement, and use the same degree of care and skill in its exercise thereof, as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs. (d) No provision of this Guarantee Agreement shall be construed to relieve the Guarantee Trustee from liability for its own negligent action, its own negligent failure to act or its own bad faith or willful misconduct, except that: (i) prior to the occurrence of any Event of Default and after the curing or waiving of all such Events of Default that may have occurred: (A) the duties and obligations of the Guarantee Trustee shall be determined solely by the express provisions of this Guarantee Agreement, and the Guarantee Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Guarantee Agreement; and (B) in the absence of bad faith on the part of the Guarantee Trustee, the Guarantee Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificates or opinions furnished to the Guarantee 6 Trustee and conforming to the requirements of this Guarantee Agreement; but in the case of any such certificates or opinions that by any provision hereof or of the Trust Indenture Act (were it applicable hereto) are specifically required to be furnished to the Guarantee Trustee, the Guarantee Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Guarantee Agreement; (ii) the Guarantee Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer of the Guarantee Trustee, unless it shall be proved that the Guarantee Trustee was negligent in ascertaining the pertinent facts upon which such judgment was made; (iii) the Guarantee Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of not less than a Majority in Liquidation Amount of the Capital Securities relating to the time, method and place of conducting any proceeding for any remedy available to the Guarantee Trustee, or exercising any trust or power conferred upon the Guarantee Trustee under this Guarantee Agreement; and (iv) no provision of this Guarantee Agreement shall require the Guarantee Trustee to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if the Guarantee Trustee shall have reasonable grounds for believing that the repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. Section 3.2 Certain Rights of Guarantee Trustee. (a) Subject to the ----------------------------------- provisions of SECTION 3.1: (i) The Guarantee Trustee may conclusively rely and shall be fully protected in acting or refraining from acting in good faith upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, appraisal, bond, debenture, note, other evidence of indebtedness or other paper or document reasonably believed by it to be genuine and to have been signed, sent or presented by the proper party or parties. (ii) Any direction or act of the Guarantor contemplated by this Guarantee Agreement shall be sufficiently evidenced by an Officers' Certificate unless otherwise prescribed herein. (iii) Whenever, in the administration of this Guarantee Agreement, the Guarantee Trustee shall deem it desirable that a matter be proved or established before taking, suffering or omitting to take any action hereunder, the Guarantee Trustee (unless other evidence is herein specifically prescribed) may, in the absence of bad faith on its part, request and conclusively rely upon an Officers' Certificate which, upon receipt of such request from the Guarantee Trustee, shall be promptly delivered by the Guarantor. 7 (iv) The Guarantee Trustee may consult with legal counsel of its selection, and the advice or opinion of such legal counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted to be taken by it hereunder in good faith and in reliance thereon. Such legal counsel may be legal counsel to the Guarantor or any of its Affiliates and may be one of its employees. The Guarantee Trustee shall have the right at any time to seek instructions concerning the administration of this Guarantee Agreement from any court of competent jurisdiction. (v) The Guarantee Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Guarantee Agreement at the request or direction of any Holder, unless such Holder shall have offered to the Guarantee Trustee such adequate security or indemnity against the costs, expenses (including attorneys' fees and expenses) and liabilities that might be incurred by it in complying with such request or direction, including such reasonable advances as may be requested by the Guarantee Trustee; provided that nothing contained in this SECTION 3.2(A)(V) shall be taken to relieve the Guarantee Trustee, upon the occurrence of an Event of Default, of its obligation to exercise the rights and powers vested in it by this Guarantee Agreement. (vi) The Guarantee Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, appraisal, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Guarantee Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit. (vii) The Guarantee Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through its agents or attorneys and the Guarantee Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed by it hereunder; (viii) Whenever in the administration of this Guarantee Agreement the Guarantee Trustee deems it desirable to receive instructions with respect to enforcing any remedy or right or taking any other action hereunder, the Guarantee Trustee (A) may request instructions from the Holders of a Majority in Liquidation Amount of the Capital Securities, (B) may refrain from enforcing such remedy or right or taking such other action until such instructions are received and (C) shall be protected in acting in accordance with such instructions. (ix) The Guarantee Trustee shall have no duty to see to any recording, filing or registration of any instrument (including any financing or continuation statement or any tax or securities form) (or any rerecording, refiling or registration thereof); and (x) The Guarantee Trustee shall not be liable for any action taken, suffered, or omitted to be taken by it in good faith and reasonably believed by it to be authorized or within the discretion of or rights or powers conferred upon by this Guarantee. 8 (b) No provision of this Guarantee Agreement shall be deemed to impose any duty or obligation on the Guarantee Trustee to perform any act or acts or exercise any right, power, duty or obligation conferred or imposed on it, in any jurisdiction in which it is illegal, or in which the Guarantee Trustee is unqualified or incompetent in accordance with applicable law, to perform any such act or acts, or to exercise any such right, power, duty or obligation. No permissive power or authority available to the Guarantee Trustee shall be construed to be a duty to act in accordance with such power and authority. Section 3.3 Not Responsible for Recitals or Issuance of Guarantee ----------------------------------------------------- Agreement. The recitals contained in this Guarantee Agreement shall be taken as - --------- the statements of the Guarantor, and the Guarantee Trustee does not assume any responsibility for their correctness. The Guarantee Trustee makes no representation as to the validity or sufficiency of this Guarantee Agreement. Section 3.4 Compensation. The Guarantor agrees to pay to the Guarantee ------------ Trustee from time to time reasonable compensation for all services rendered by it hereunder (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust) and to reimburse the Guarantee Trustee upon request for all reasonable expenses, disbursements and advances incurred or made by the Guarantee Trustee in accordance with any provision of this Guarantee Agreement (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its negligence or willful misconduct. In addition to the rights provided to the Guarantee Trustee herein and not by way of prejudice, when the Guarantee Trustee incurs expenses or renders services in connection with the enforcement of this Guarantee Agreement, the expenses (including the reasonable charges and expenses of its counsel) and the compensation for the services are intended to constitute expenses of administration under any applicable Federal or State bankruptcy, insolvency or other similar law. Section 3.5 Indemnity. The Guarantor agrees to indemnify the Guarantee --------- Trustee for, and to hold it harmless against, any and all loss, liability, damage, claim or expense, including taxes (other than taxes based upon the income of the Guarantee Trustee), incurred without willful misconduct or negligence on the part of the Guarantee Trustee, arising out of or in connection with the acceptance or administration of this Guarantee Agreement, including the costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder. As security for the performance of the obligations of the Guarantor under SECTION 3.4 and this SECTION 3.5 the Guarantee Trustee shall have a lien prior to any payments to any Holders of the Capital Securities hereunder upon all the property and funds held or collected by the Guarantee Trustee as such, except funds held in trust for the payment of any particular such payments of the Guarantor under this Guarantee Agreement. The provisions of SECTION 3.4 and this SECTION 3.5 shall survive the termination of this Guarantee Agreement, the payment of any Guarantee Payment and or the removal or resignation of the Guarantee Trustee. 9 "Guarantee Trustee" for the purposes of SECTION 3.4 and this SECTION 3.5 shall include any predecessor trustee; provided however, that the negligence or willful misconduct of any Guarantee Trustee hereunder shall not affect the rights of any other Guarantee Trustee hereunder. ARTICLE IV GUARANTEE TRUSTEE ----------------- Section 4.1 Guarantee Trustee: Eligibility. (a) There shall at all times be ------------------------------ a Guarantee Trustee that shall: (i) not be an Affiliate of the Guarantor; and (ii) be a Person that is eligible pursuant to the Trust Indenture Act to act as such and has a combined capital and surplus of at least $50,000,000, and shall be a corporation meeting the requirements of Section 310(a) of the Trust Indenture Act. If such corporation publishes reports of condition at least annually, pursuant to law or the requirements of its supervising or examining authority, then, for the purposes of this Section and to the extent permitted by the Trust Indenture Act, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. (b) If at any time the Guarantee Trustee shall cease to be eligible to so act under SECTION 4.1(A), the Guarantee Trustee shall immediately resign in the manner and with the effect set out in SECTION 4.2(C). (c) If the Guarantee Trustee has or shall acquire any "conflicting interest" within the meaning of Section 310(b) of the Trust Indenture Act, the Guarantee Trustee and Guarantor shall in all respects comply with the provisions of Section 310(b) of the Trust Indenture Act. Section 4.2 Appointment, Removal and Resignation of the Guarantee Trustee. ------------------------------------------------------------- (a) Subject to SECTION 4.2(B), unless an Event of Default shall have occurred and be continuing, the Guarantee Trustee may be appointed or removed without cause at any time by the Guarantor. Subject to the provisions of this SECTION 4.2, if an Event of Default shall have occurred and be continuing, the Guarantee Trustee may be appointed or removed by the Holders of a Majority in Liquidation Amount of the Capital Securities. (b) The Guarantee Trustee shall not be removed until a Successor Guarantee Trustee has been appointed and has accepted such appointment by written instrument executed by such Successor Guarantee Trustee and delivered to the Guarantor. (c) The Guarantee Trustee appointed hereunder shall hold office until a Successor Guarantee Trustee shall have been appointed or until its removal or resignation. The Guarantee Trustee may resign from office (without need for prior or subsequent accounting) by an instrument in writing executed by the Guarantee Trustee and delivered to the Guarantor, which resignation shall not take effect until a Successor Guarantee Trustee has been appointed and has 10 accepted such appointment by instrument in writing executed by such Successor Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee Trustee. (d) If no Successor Guarantee Trustee has been appointed and accepted appointment as provided in this SECTION 4.2 within 60 days after delivery to the Guarantor of an instrument of resignation, the resigning Guarantee Trustee may petition, at the expense of the Guarantor, any court of competent jurisdiction for appointment of a Successor Guarantee Trustee. Such court may thereupon, after prescribing such notice, if any, as it may deem proper, appoint a Successor Guarantee Trustee. ARTICLE V GUARANTEE --------- Section 5.1 Guarantee. The Guarantor irrevocably and unconditionally agrees --------- to pay in full to the Holders the Guarantee Payments (without duplication of amounts theretofore paid by or on behalf of the Issuer), as and when due, regardless of any defense, right of set-off or counterclaim that the Issuer may have or assert other than the defense of payment. The Guarantor's obligation to make a Guarantee Payment may be satisfied by direct payment of the required amounts by the Guarantor to the Holders or by causing the Issuer to pay such amounts to the Holders. Section 5.2 Waiver of Notice and Demand. The Guarantor hereby waives notice --------------------------- of acceptance of the Guarantee Agreement and of any liability to which it applies or may apply, presentment, demand for payment, any right to require a proceeding first against the Guarantee Trustee, Issuer or any other Person before proceeding against the Guarantor, protest, notice of nonpayment, notice of dishonor, notice of redemption and all other notices and demands. Section 5.3 Obligations Not Affected. The obligations, covenants, ------------------------ agreements and duties of the Guarantor under this Guarantee Agreement shall in no way be affected or impaired by reason of the happening from time to time of any of the following: (a) the release or waiver, by operation of law or otherwise, of the performance or observance by the Issuer of any express or implied agreement, covenant, term or condition relating to the Capital Securities to be performed or observed by the Issuer; (b) the extension of time for the payment by the Issuer of all or any portion of the Distributions (other than an extension of time for payment of Distributions that results from the extension of any interest payment period on the Debentures as so provided in the Indenture), Redemption Price, Liquidation Distribution or any other sums payable under the terms of the Capital Securities or the extension of time for the performance of any other obligation under, arising out of, or in connection with, the Capital Securities; (c) any failure, omission, delay or lack of diligence on the part of the Holders to enforce, assert or exercise any right, privilege, power or remedy conferred on the Holders pursuant to the terms of the Capital Securities, or any action on the part of the Issuer granting indulgence or extension of any kind; 11 (d) the voluntary or involuntary liquidation, dissolution, sale of any collateral, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or readjustment of debt of, or other similar proceedings affecting the Issuer or any of the assets of the Issuer; (e) any invalidity of, or defect or deficiency in, the Capital Securities; (f) the settlement or compromise of any obligation guaranteed hereby or hereby incurred; or (g) any other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense of a guarantor, it being the intent of this SECTION 5.3 that the obligations of the Guarantor hereunder shall be absolute and unconditional under any and all circumstances. There shall be no obligation of the Holders to give notice to, or obtain the consent of, the Guarantor with respect to the happening of any of the foregoing. Section 5.4 Rights of Holders. The Guarantor expressly acknowledges that: ----------------- (i) this Guarantee Agreement will be deposited with the Guarantee Trustee to be held for the benefit of the Holders; (ii) the Guarantee Trustee has the right to enforce this Guarantee Agreement on behalf of the Holders; (iii) the Holders of a Majority in Liquidation Amount of the Capital Securities have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Guarantee Trustee in respect of this Guarantee Agreement or exercising any trust or power conferred upon the Guarantee Trustee under this Guarantee Agreement; and (iv) to the fullest extent permitted by law, any Holder may institute a legal proceeding directly against the Guarantor to enforce its rights under this Guarantee Agreement, without first instituting a proceeding against the Guarantee Trustee, the Issuer or any other Person. The Guarantor waives any right to require that any action be brought first against the Issuer or any other Person or entity before proceeding directly against the Guarantor. Section 5.5 Guarantee of Payment. This Guarantee Agreement creates a -------------------- guarantee of payment and not of collection. This Guarantee Agreement will not be discharged except by payment of the Guarantee Payments in full (without duplication of amounts theretofore paid by the Issuer) or upon distribution of Debentures to Holders as provided in the Trust Agreement. Section 5.6 Subrogation. The Guarantor shall be subrogated to all (if any) ----------- rights of the Holders against the Issuer in respect of any amounts paid to the Holders by the Guarantor under this Guarantee Agreement and shall have the right to waive payment by the Issuer pursuant to SECTION 5.1; provided, however, that the Guarantor shall not (except to the extent required by mandatory provisions of law) be entitled to enforce or exercise any rights that it may acquire by way of subrogation or any indemnity, reimbursement or other agreement, in all cases as a result of payment under this Guarantee Agreement, if at the time of any such payment, any amounts are due and unpaid under this Guarantee Agreement. If any amount shall be paid to the Guarantor in violation of the preceding sentence, the Guarantor agrees to hold such amount in trust for the Holders and to pay over such amount to the Holders. 12 Section 5.7 Independent Obligations. The Guarantor acknowledges that its ----------------------- obligations hereunder are independent of the obligations of the Issuer with respect to the Capital Securities and that the Guarantor shall be liable as principal and as debtor hereunder to make Guarantee Payments pursuant to the terms of this Guarantee Agreement notwithstanding the occurrence of any event referred to in subsections (a) through (g), inclusive of SECTION 5.3 hereof. Section 5.8 Merger or Consolidation of Guarantor. The Guarantor covenants ------------------------------------ that it will not consolidate with or merge into any other Person, or transfer, convey or lease all or substantially all of its assets or properties to any other Person, and no other Person shall consolidate with or merge into the Guarantor, or transfer, convey or lease all or substantially all of its assets to the Guarantor, unless (i) either the Guarantor shall be the continuing corporation, or the successor shall be a Person organized and existing under the laws of the United States of America or a State thereof or the District of Columbia and such successor shall expressly assume the Guarantor's obligations under this Guarantee Agreement by written instrument satisfactory to the Guarantee Trustee, executed and delivered to the Guarantee Trustee by such successor, (ii) immediately after such merger or consolidation, or such transfer, conveyance or lease, no Event of Default hereunder, and no event that, after notice or lapse of time or both would become an Event of Default, has happened and is continuing, and (iii) such consolidation, merger, transfer, conveyance or lease is permitted under the Trust Agreement and Indenture and does not give rise to any breach or violation of the Trust Agreement or Indenture. ARTICLE VI SUBORDINATION ------------- Section 6.1 Subordination. The obligations of the Guarantor under this ------------- Guarantee Agreement constitute unsecured obligations of the Guarantor and rank subordinate and junior in right of payment to all other liabilities of the Guarantor (including obligations under the Debentures) except (a) those liabilities that expressly by their terms are made pari passu or subordinate to the obligations of the Guarantor under this Guarantee Agreement and (b) liabilities arising under similar guarantee agreements as described in SECTION 6.2 hereof. Nothing in this Article VI shall apply to the claims of, or payments to, the Guarantee Trustee under or pursuant to SECTIONS 3.4 and 3.5 of this Guarantee Agreement. Section 6.2 Pari Passu to Similar Guarantees. The obligations of the -------------------------------- Guarantor under this Guarantee Agreement shall rank pari passu with the obligations of the Guarantor under any similar guarantee agreements issued by the Guarantor on behalf of the holders of preferred securities or capital securities issued by any DPL Trust (as defined in the Indenture). ARTICLE VII TERMINATION ----------- Section 7.1 Termination. This Guarantee Agreement shall terminate and be of ----------- no further force and effect upon the earliest of (i) the date on which all of 13 the Capital Securities cease to be outstanding following the consummation of the Exchange Offer, (ii) full payment of the Redemption Price of all Capital Securities, (iii) the distribution of Debentures to the Holders in exchange for all of the Capital Securities or (iv) full payment of the amounts payable in accordance with the Trust Agreement upon liquidation of the Issuer. Notwithstanding the foregoing, this Guarantee Agreement will continue to be effective or will be reinstated if it has been terminated pursuant to one of such clauses (ii) through (iv), as the case may be, if at any time any Holder must restore payment of any sums paid with respect to Capital Securities or this Guarantee Agreement. SECTIONS 3.4 and 3.5 shall survive the termination of the Guarantee Agreement. ARTICLE VIII MISCELLANEOUS ------------- Section 8.1 Successors and Assigns. All guarantees and agreements contained ---------------------- in this Guarantee Agreement shall bind the successors, assigns, receivers, trustees and representatives of the Guarantor and shall inure to the benefit of the Holders of the Capital Securities then outstanding. Except in connection with a consolidation, merger or sale involving the Guarantor that is permitted under SECTION 5.8 of this Guarantee Agreement, the Guarantor shall not assign its obligations hereunder. Section 8.2 Amendments. Except with respect to any changes that do not ---------- adversely affect the rights of the Holders in any material respect (in which case no consent of the Holders will be required), this Guarantee Agreement may only be amended with the prior approval of the Holders of not less than a Majority in Liquidation Amount of the Capital Securities. The provisions of Article VI of the Trust Agreement concerning meetings of the Holders shall apply to the giving of such approval. Section 8.3 Notices. Any notice, request or other communication required or ------- permitted to be given hereunder shall be in writing, duly signed by the party giving such notice, and personally delivered, telecopied or mailed by first class mail as follows: (a) if given to the Guarantor, to the address set forth below or such other address, facsimile number or to the attention of such other Person as the Guarantor may give notice to the Holders: DPL Inc. Courthouse Plaza Southwest Dayton, Ohio 45402 Facsimile No. (937) 259-7368 Attention: Treasurer (b) If given to the Issuer, in care of the Guarantee Trustee, at the (and the Guarantee Trustee's) address set forth below or such address as the Guarantee Trustee on behalf of the Issuer may give to the Holders: 14 DPL Capital Trust II Courthouse Plaza Southwest Dayton, Ohio 45402 Facsimile No. (937) 259-7368 Attention: Treasurer with a copy to: The Bank of New York 101 Barclay Street, Floor 21 West New York, New York 10286 Attention: Corporate Trust Administration Telecopy: (212) 815-5915 (c) if given to any Holder, at the address set forth on the books and records of the Issuer. All notices hereunder shall be deemed to have been given when received in person, telecopied with receipt confirmed, or three days after being mailed by first class mail, postage prepaid. Section 8.4 Benefit. This Guarantee Agreement is solely for the benefit of ------- the Holders and is not separately transferable from the Capital Securities. Section 8.5 Interpretation. In this Guarantee Agreement, unless the context -------------- otherwise requires: (a) capitalized terms used in this Guarantee Agreement but not defined in the preamble hereto have the respective meanings assigned to them in SECTION 1.1; (b) a term defined anywhere in this Guarantee Agreement has the same meaning throughout; (c) all references to "the Guarantee Agreement" or "this Guarantee Agreement" are to this Guarantee Agreement as modified, supplemented or amended from time to time; (d) all references in this Guarantee Agreement to Articles and Sections are to Articles and Sections of this Guarantee Agreement unless otherwise specified; (e) a term defined in the Trust Indenture Act has the same meaning when used in this Guarantee Agreement unless otherwise specified; (f) a reference to the singular includes the plural and vice versa; and 15 (g) the masculine, feminine or neuter genders used herein shall include the masculine, feminine and neuter genders. Section 8.6 Governing Law. THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY ------------- AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW OR ANY SUCCESSOR TO SUCH STATUTE). This instrument may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. 16 THIS CAPITAL SECURITIES GUARANTEE AGREEMENT is executed as of the day and year first above written. DPL INC. By: --------------------------------------- Name: Title: THE BANK OF NEW YORK as Guarantee Trustee By: --------------------------------------- Name: Title: 17 EX-4 10 e431348v1.txt EXHIBIT 4(H) EXHIBIT 4(H) AGREEMENT AS TO EXPENSES AND LIABILITIES AGREEMENT dated as of August 31, 2001, between DPL Inc., an Ohio corporation ("DPL"), and DPL Capital Trust II, a Delaware statutory business trust (the "TRUST"). WHEREAS, the Trust intends to issue its 8 1/8% Common Securities (Liquidation Amount $1,000 per Common Security) (the "COMMON SECURITIES") to, and purchase 8 1/8% Junior Subordinated Deferrable Interest Debentures due September 1, 2031 (the "Debentures") from, DPL, and to issue and sell its 8 1/8% Capital Securities (Liquidation Amount $1,000 per Capital Security) (the "PRIVATE CAPITAL SECURITIES") with such powers, preferences and special rights and restrictions as are set forth in the Amended and Restated Trust Agreement of the Trust dated as of August 31, 2001, as the same may be amended from time to time (the "TRUST Agreement"); WHEREAS, DPL will directly or indirectly own all of the Common Securities and will issue the Debentures; WHEREAS, the Trust may issue a new series of 8 1/8% Capital Securities (Liquidation Amount $1,000 per Capital Security) (the "EXCHANGE CAPITAL SECURITIES" and, together with the "PRIVATE CAPITAL SECURITIES," the "CAPITAL SECURITIES") in connection with an exchange offer (the "EXCHANGE OFFER") registered under the Securities Act of 1933, as amended; NOW, THEREFORE, in consideration of the purchase by each holder of the Capital Securities, which purchase DPL hereby agrees shall benefit DPL and which purchase DPL acknowledges will be made in reliance upon the execution and delivery of this Agreement, DPL and the Trust hereby agree as follows: ARTICLE I SECTION 1.1. Guarantee by DPL Inc. Subject to the terms and conditions -------------------- hereof, DPL hereby irrevocably and unconditionally guarantees to each person or entity to whom the Trust is now or hereafter becomes indebted or liable (the "BENEFICIARIES") the full payment, when and as due, of any and all Obligations (as hereinafter defined) to such Beneficiaries. As used herein, "OBLIGATIONS" means any costs, expenses or liabilities of the Trust, other than obligations of the Trust to pay to holders of any Capital Securities or other similar interests in the Trust the amounts due such holders pursuant to the terms of the Capital Securities or such other similar interests, as the case may be. This Agreement is intended to be for the benefit of, and to be enforceable by, all such Beneficiaries, whether or not such Beneficiaries have received notice hereof. SECTION 1.2. Terms of Agreement. This Agreement shall terminate and be of ------------------ no further force and effect upon the later of (a) the date on which full payment has been made of all amounts payable to all holders of all the Capital Securities (whether upon redemption, liquidation, exchange or otherwise) and (b) the date on which there are no Beneficiaries remaining; provided, however, that this Agreement shall continue to be effective or shall be reinstated, as the case may be, if at any time any holder of Capital Securities or any Beneficiary must restore payment of any sums paid under the Capital Securities, under any Obligation, under the Capital Securities Guarantee Agreement dated as of the date hereof by DPL and The Bank of New York, as guarantee trustee, or under this Agreement for any reason whatsoever. This Agreement is continuing, irrevocable, unconditional and absolute. SECTION 1.3. Waiver of Notice. DPL waives notice of acceptance of this ---------------- Agreement and of any Obligation to which it applies or may apply, and DPL hereby waives presentment, demand for payment, protest, notice of nonpayment, notice of dishonor, notice of redemption and all other notices and demands. SECTION 1.4. No Impairment. The obligations, covenants, agreements and ------------- duties of DPL under this Agreement shall in no way be affected or impaired by reason of the happening from time to time of any of the following: (a) the extension of time for the payment by the Trust of all or any portion of the Obligations or for the performance of any other obligation under, arising out of, or in connection with, the Obligations; (b) any failure, omission, delay or lack of diligence on the part of the Beneficiaries to enforce, assert or exercise any right, privilege, power or remedy conferred on the Beneficiaries with respect to the Obligations or any action on the part of the Trust granting indulgence or extension of any kind; or (c) the voluntary or involuntary liquidation, dissolution, sale of any collateral, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or readjustment of debt of, or other similar proceedings affecting, the Trust or any of the assets of the Trust. There shall be no obligation of the Beneficiaries to give notice to, or obtain the consent of, DPL with respect to the happening of any of the foregoing. SECTION 1.5. Enforcement. A Beneficiary may enforce this Agreement directly ----------- against DPL, and DPL waives any right or remedy to require that any action be brought against the Trust or any other person or entity before proceeding against DPL. SECTION 1.6. Subrogation. DPL shall be subrogated to all rights (if any) of ----------- the Trust in respect of any amounts paid to the Beneficiaries by DPL under this Agreement; provided, however, that DPL shall not (except to the extent required by mandatory provisions of law) be entitled to enforce or exercise any rights which it may acquire by way of subrogation or any indemnity, reimbursement or other agreement, in all cases as a result of payment under this Agreement, if, at the time of any such payment, any amounts are due and unpaid under this Agreement. 2 ARTICLE II SECTION 2.1. Binding Effect. All guarantees and agreements contained in -------------- this Agreement shall bind the successors, assigns, receivers, trustees and representatives of DPL and shall inure to the benefit of the Beneficiaries. SECTION 2.2. Amendment. So long as there remains any Beneficiary or any --------- Capital Securities of any series are outstanding, this Agreement shall not be modified or amended in any manner adverse to such Beneficiary or to the holders of the Capital Securities. SECTION 2.3. Notices. Any notice, request or other communication required ------- or permitted to be given hereunder shall be given in writing by delivering the same by personal delivery, by facsimile transmission or by first-class mail, addressed as follows (and if so given, shall be deemed given when so delivered, upon receipt of confirmation if by facsimile, or three days after mailed if by first-class mail): DPL Capital Trust II c/o DPL Inc. Courthouse Plaza Southwest Dayton, Ohio 45402 Attention: Treasurer Facsimile No.: (937) 259-7386 DPL Inc. Courthouse Plaza Southwest Dayton, Ohio 45402 Attention: Treasurer Facsimile No.: (937) 259-7386 SECTION 2.4. This Agreement shall be governed by and construed and interpreted in accordance with the laws of the State of New York (without regard to conflict of laws principles). 3 THIS AGREEMENT is executed as of the day and year first above written. DPL INC. By: /s/ Elizabeth M. McCarthy ------------------------------------------------ Name: Elizabeth M. McCarthy Title: Vice President and Chief Financial Officer DPL Capital Trust II By: /s/ Stephen F. Koziar, Jr. ------------------------------------------------ Name: S.F. Koziar, Jr. Title: Administrative Trustee 4 EX-5 11 e437528.txt EXHIBIT 5(A) EXHIBIT 5(a) Letterhead of DPL INC. December 4, 2001 DPL Inc. Courthouse Plaza Southwest Dayton, Ohio 45402 Ladies and Gentlemen: Reference is hereby made to (i) the proposed issuance by DPL Capital Trust II (the "Trust") of up to and including $300 million aggregate liquidation amount of its 8 1/8% Capital Securities in exchange for up to and including $300 million aggregate Liquidation Amount of its outstanding 8 1/8% Capital Securities; (ii) the proposed issuance by the DPL Inc. (the "Company") to the Trust of $309.3 million in an aggregate principal amount of the Company's 8 1/8% Junior Subordinated Debentures due September 1, 2031 (the "Exchange Junior Subordinated Debentures") in exchange for a comparable aggregate principal amount of the Company's outstanding 8 1/8% Junior Subordinated Debentures due September 1, 2031; and (iii) the proposed execution and delivery of a Capital Securities Guarantee by the Company (the "Exchange Guarantee") in connection with the Exchange Capital Securities, each as more fully described in the joint Registration Statement of the Company and the Trust on Form S-4 (the "Registration Statement") under the Securities Act of 1933, as amended (the "Act"), which is being filed on or about the date hereof. Subject to the qualifications hereinafter expressed, I am of the opinion that (i) the Exchange Junior Subordinated Debentures, when issued and delivered as contemplated in the Registration Statement, will be legally issued and will be binding obligations of the Company and (ii) the Exchange Guarantee, when delivered as contemplated in the Registration Statement, will be a binding obligation of the Company. I am a member of the Ohio Bar and do not hold myself out as expert on the laws of the state of New York. Accordingly, in rendering this opinion, I have relied, with your consent, as to all matters governed by the laws of New York, upon an opinion of even date herewith addressed to you by Thelen, Reid & Priest LLP of New York, New York, which is being filed as an exhibit to the Registration Statement. I hereby consent to the use of my name is such Registration Statement and to the use of this opinion as an exhibit thereto. Very truly yours, /s/ Stephen F. Koziar, Jr. -------------------------- Stephen F. Koziar, Jr. Group Vice President and General Counsel 2 EX-5 12 e432098.txt EXHIBIT 5(B) EXHIBIT 5(B) [Letterhead of Morris, Nichols, Arsht & Tunnell] December 4, 2001 ---------------- December 4, 2001 DPL Capital Trust II c/o DPL Inc. Courthouse Plaza Southwest Dayton, Ohio 45402 Re: DPL Capital Trust II Ladies and Gentlemen: We have acted as special Delaware counsel to DPL Capital Trust II, a Delaware statutory business trust (the "Trust"), in connection with certain matters relating to the formation of the Trust and the proposed issuance of Exchange Capital Securities to beneficial owners pursuant to and as described in the Registration Statement (and the Prospectus forming a part thereof) on Form S-4 filed with the Securities and Exchange Commission on October , 2001 (the "Registration Statement"). Capitalized terms used herein and not otherwise herein defined are used as defined in the Amended and Restated Trust Agreement of the Trust dated as of August 31, 2001 (the "Governing Instrument"). In rendering this opinion, we have examined and relied upon copies of the following documents in the forms provided to us: the Certificate of Trust of the Trust as filed in the Office of the Secretary of State of the State of Delaware.(the "State Office") on August 23, 2001 (the "Certificate of Trust"); the Trust Agreement of the Trust dated as of August 23, 2001 (the "Original Governing Instrument"); the Governing Instrument; the Exchange and Registration Rights Agreement dated as of August 24, 2001 among the Trust, DPL Inc. and Morgan Stanley & Co. Incorporated (the "Registration Rights Agreement"); the Registration Statement; and a certification of good standing of the Trust obtained as of a recent date from the State Office. In such examinations, we have assumed the genuineness of all signatures, the conformity to original documents of all documents submitted to us as drafts or copies or forms of documents to be executed and the legal capacity of natural persons to complete the execution of documents. We have further assumed for purposes of this opinion: (i) the due formation or organization, valid existence and good standing of each entity (other than the Trust) that is a party to any of the 2 documents reviewed by us under the laws of the jurisdiction of its respective formation or organization; (ii) the due authorization, execution and delivery by, or on behalf of, each of the parties thereto of the above-referenced documents (including, without limitation, the due authorization, execution and delivery of the Governing Instrument and the Registration Rights Agreement prior to the first issuance of Capital Securities); (iii) that no event has occurred subsequent to the filing of the Certificate of Trust that would cause a dissolution or liquidation of the Trust under the Original Governing Instrument or the Governing Instrument, as applicable; (iv) that the activities of the Trust have been and will be conducted in accordance with the Original Governing Instrument or the Governing Instrument, as applicable, and the Delaware Business Trust Act, 12 Del. C. Secs. 3801 et seq. (the "Delaware Act"); (v) that each Person that will acquire Exchange Capital Securities in the Exchange Offer will validly tender Private Capital Securities in exchange therefor, that such Private Capital Securities will be duly accepted, and that such Person will duly receive Exchange Capital Securities in consideration thereof, all in accordance with the terms and conditions of the Governing Instrument, the Registration Statement and the Registration Rights Agreement and that the Exchange Capital Securities are otherwise issued and sold to the Exchange Capital Securities Holders in accordance with the terms, conditions, requirements and procedures set forth in the Governing Instrument, the Registration Statement and the Registration Rights Agreement; and (vi) that the documents examined by us are in full force and effect, express the entire understanding of the parties thereto with respect to the subject matter thereof and have not been amended, supplemented or otherwise modified, except as herein referenced. We have not reviewed any documents other than those identified above in connection with this opinion, and we have assumed that there are no other documents that are contrary to or inconsistent with the opinions expressed herein. Further, we express no opinion with respect to, and assume no responsibility for the contents of, the Registration Statement or any other offering material relating to the Exchange Capital Securities. No opinion is expressed herein with respect to the requirements of, or compliance with, federal or state securities or blue sky laws. As to any fact material to our opinion, other than those assumed, we have relied without independent investigation on the above-referenced documents and certificates and on the accuracy, as of the date hereof, of the matters therein contained. Based on and subject to the foregoing, and limited in all respects to matters of Delaware law, it is our opinion that: 1. The Trust is a duly formed and validly existing business trust in good standing under the laws of the State of Delaware. 2. The Exchange Capital Securities, upon issuance pursuant to the Exchange Offer, will constitute validly issued, fully paid and nonassessable beneficial interests in the assets of the Trust. We note that pursuant to the Governing Instrument, the Exchange Capital Securities Holders may be obligated to make payments or provide indemnity or security under the circumstances set forth therein. 3 3. Under the Delaware Act and the terms of the Governing Instrument, each Exchange Capital Securities Holder, in such capacity, will be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the General Corporation Law of the State of Delaware; provided, however, we express no opinion with respect to the liability of any Exchange Capital Securities Holder who is, was or may become a named Trustee of the Trust. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of our name and reference to our opinion under the heading "LEGAL MATTERS" in the Prospectus forming a part thereof. In giving this consent, we do not thereby admit that we come within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission thereunder. This opinion speaks only as of the date hereof and is based on our understandings and assumptions as to present facts, and on our review of the above-referenced documents and the application of Delaware law as the same exist as of the date hereof, and we undertake no obligation to update or supplement this opinion after the date hereof for the benefit of any person or entity with respect to any facts or circumstances that may hereafter come to our attention or any changes in facts or law that may hereafter occur or take effect. This opinion is intended solely for the benefit of the addressee hereof in connection with the matters contemplated hereby and may not be relied on by any other person or entity or for any other purpose without our prior written consent. Very truly yours, MORRIS, NICHOLS, ARSHT & TUNNELL /s/ Jonathan I. Lessner ------------------------------ Jonathan I. Lessner EX-5 13 e431874v1.txt EXHIBIT 5(C) Exhibit 5(c), 8 & 23(c) [Letterhead of Thelen Reid & Priest LLP] New York, New York December 4, 2001 DPL Inc. Courthouse Plaza Southwest Dayton, Ohio 45402 Ladies and Gentlemen: We are acting as special counsel to DPL Inc., an Ohio corporation (the "Company"), in connection with the filing by the Company of a Registration Statement on Form S-4 (the "Registration Statement") under the Securities Act of 1933, as amended (the "Act"), on or about the date hereof. The Registration Statement relates to (i) the issuance by DPL Capital Trust II of up to and including $300 million aggregate liquidation amount of its 8 1/8% Capital Securities in exchange for up to and including $300 million aggregate Liquidation Amount of its outstanding 8 1/8% Capital Securities; (ii) the issuance by the Company to DPL Capital Trust II, of $309.3 million in an aggregate principal amount of the Company's 8 1/8% Junior Subordinated Debentures due September 1, 2031 (the "Exchange Junior Subordinated Debentures"), in exchange for a comparable aggregate principal amount of the Company's outstanding 8 1/8% Junior Subordinated Debentures due September 1, 2031; and (iii) the execution and delivery of a Capital Securities Guarantee by the Company (the "Exchange Guarantee") in connection with the Exchange Capital Securities, and as further described in the Registration Statement Subject to the qualifications hereinafter expressed, we are of the opinion that (i) the Exchange Junior Subordinated Debentures, when issued and delivered as contemplated in the Registration Statement, will be legally issued and will be binding obligations of the Company and (ii) the Exchange Guarantee, when delivered as contemplated in the Registration Statement, will be a binding obligation of the Company. We confirm our opinion as set forth under the caption "Certain United States Federal Income Tax Consequences" in the prospectus constituting a part of the Registration Statement. We are members of the New York Bar and do not hold ourselves out as experts on the laws of the state of Ohio. Accordingly, in rendering this opinion, we have relied, with your consent, as to all matters governed by the laws of Ohio, upon an opinion of even date herewith addressed to you by Stephen F. Koziar, Jr., Esq., Group Vice President and General Counsel for the Company, which is being filed as an exhibit to the Registration Statement. We hereby consent to the filing of this opinion as Exhibit 5(c) to the Registration Statement and to the references to our firm, as counsel, in the Registration Statement and in the prospectus contained therein. In giving the foregoing consent, we do not admit that we are within the category of persons whose consent is required under Section 7 of the Act or the rules and regulations promulgated thereunder. Very truly yours, /s/ THELEN REID & PRIEST LLP ---------------------------- THELEN REID & PRIEST LLP EX-12 14 e437448.txt EXHIBIT 12 EXHIBIT 12 ----------
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES ------------------------------------------------- DPL INC. CONSOLIDATED 2001 2000 2000 1999 1998 1997 1996 SEC COVERAGE RATIOS 9 Mos. 9 Mos. 12 Mos. 12 Mos. 12 Mos. 12 Mos. 12 Mos. Ended Ended Ended Ended Ended Ended Ended 9/30/01 9/30/00 12/31/00 12/31/99 12/31/98 12/31/97 12/31/96 ------- ------- -------- -------- -------- -------- -------- Ratio of Earnings to Fixed Charges (SEC Method): Fixed Charges: Interest on First Mortgage Bonds ................... 31,918 31,945 42,591 48,291 61,540 65,507 68,655 Other Interest Expense ............................. 99,212 147,813 184,139 62,461 31,406 20,832 20,383 Interest Component of Rentals ...................... 101 103 160 114 126 167 320 ------- ------- ------- ------- ------ ------ ------ Total Fixed Charges ............................ 131,231 179,861 226,890 110,866 93,072 86,506 89,348 Earnings: Income from Continuing Operations (before Preferred dividends) ......................................... 183,603 119,777 285,828 205,085 189,969 182,263 173,769 Plus: Income Taxes ................................ 110,149 70,471 156,640 127,948 120,394 105,443 103,477 Fixed Charges (defined above) ................ 131,231 179,861 226,890 110,866 93,072 86,506 89,358 ------- ------- ------- ------- ------ ------ ------ Total ............................................ 424,983 370,109 669,358 443,899 403,435 374,212 366,604 Ratio = Earnings/Fixed Charges = ...... 424,983 370,109 669,358 443,899 403,435 374,212 366,604 ------- ------- ------- ------- ------ ------ ------ 131,231 179,861 226,890 110,866 93,072 86,506 89,358 Ratio of Earnings to Fixed Charges - (SEC) Method) 3.24 2.06 2.95 4.00 4.33 4.32 4.10
EX-23 15 e432187.txt EXHIBIT 23(D) EXHIBIT 23(D) CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in this Registration Statement on Form S-4 of DPL Inc. and DPL Capital Trust II of our report dated January 29, 2001 relating to the financial statements, which appears in DPL Inc.'s 2000 Annual Report to Shareholders, which is incorporated by reference in its Annual Report on Form 10-K for the year ended December 31, 2000. We also consent to the incorporation by reference of our report dated January 29, 2001 relating to the financial statement schedule, which appears in such Annual Report on Form 10-K. We also consent to the reference to us under the heading "Experts" in such Registration Statement. PricewaterhouseCoopers LLP Dayton, Ohio December 4, 2001 EX-25 16 e432006v1.txt EXHIBIT 25(A) EXHIBIT 25(a) SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------------------- FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) ------------------------- THE BANK OF NEW YORK (Exact name of trustee as specified in its charter) New York 13-5160382 (Jurisdiction of incorporation (I.R.S. Employer if not a U.S. national bank) Identification No.) One Wall Street, New York, New York 10286 (Address of principal executive offices) (Zip code) ------------------------- DPL CAPITAL TRUST II (Exact name of obligor as specified in its charter) Delaware To Be Applied For (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.) Courthouse Plaza Southwest Dayton, Ohio 45402 (Address of principal executive offices) (Zip code) ------------------------- 8 1/8 % CAPITAL SECURITIES (Title f the indenture securities) ITEM 1. GENERAL INFORMATION.* Furnish the following information as to the Trustee: (a) Name and address of each examining or supervising authority to which it is subject. Superintendent of Banks of the 2 Rector Street, New York, N.Y. 10006 State of New York and Albany, N.Y. 12203 Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y. 10045 Federal Deposit Insurance Corporation 550 17th Street, N.W., Washington, D.C. 20429 New York Clearing House Association New York, N.Y. (b) Whether it is authorized to exercise corporate trust powers. Yes. ITEM 2. AFFILIATIONS WITH OBLIGOR. If the obligor is an affiliate of the trustee, describe each such affiliation. None. (See Note on page 2.) ITEM 16. LIST OF EXHIBITS. Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the "Act") and Rule 24 of the Commission's Rules of Practice. 1. - A copy of the Organization Certificate of The Bank of New York (formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits la and lb to Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637.) 4. - A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 33-31019.) 6. - The consent of the Trustee required by Section 321 (b) of the Act. (Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.) 7. - A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority. - ------------- * Pursuant to General Instruction B, the Trustee has responded only to Items 1, 2 and 16 of this form since to the best of the knowledge of the Trustee the obligor is not in default under any indenture under which the Trustee is a trustee. NOTE Inasmuch as this Form T-1 is being filed prior to the ascertainment by the Trustee of all facts on which to base a responsive answer to Item 2, the answer to said Item is based on incomplete information. Item 2 may, however, be considered as correct unless amended by an amendment to this Form T-1. SIGNATURE Pursuant to the requirements of the Act, the Trustee, The Bank of New York, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 20th day of November, 2001. THE BANK OF NEW YORK By: /s/ PAUL J. SCHMALZEL ------------------------ Paul J. Schmalzel Vice President 2 EXHIBIT 7 (Page 1 of 3) Consolidated Report of Condition of THE BANK OF NEW YORK of One Wall Street, New York, N.Y. 10286 And Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business June 30, 2001, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act. ASSETS Dollar Amounts in - ------ Thousands ----------------- Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin.................. $ 3,946,551 Interest-bearing balances.................. 5,454,795 Securities: Held-to-maturity securities................ 127,189 Available-for-sale securities.............. 8,367,798 Federal funds sold and Securities purchased under agreements to resell....... 2,578,045 Loans and lease financing receivables: Loans and leases held for sale.................. 15,750 Loans and leases, net of unearned Income..................................... 37,240,401 LESS: Allowance for loan and lease losses........................... 604,286 Loans and leases, net of unearned income and allowance................... 36,636,115 Trading Assets.................................. 9,717,521 Premises and fixed assets (including capitalized leases)........................ 777,125 Other real estate owned......................... 1,190 Investments in unconsolidated subsidiaries and associated companies................... 197,938 Customers' liability to this bank on acceptances outstanding.................... 684,954 Intangible assets Goodwill................................... 1,516,774 Other intangible assets.................... 118,954 Other assets.................................... 3,987,019 ------------ Total assets.................................... $ 74,127,718 ============ EXHIBIT 7 (Page 2 of 3) LIABILITIES Deposits: In domestic offices........................ $ 27,176,888 Noninterest-bearing........................ 11,540,657 Interest-bearing........................... 15,636,231 In foreign offices, Edge an................ Agreement subsidiaries, and IBFs........... 26,457,350 Noninterest-bearing........................ 462,578 Interest-bearing........................... 25,994,772 Federal funds purchased and securities sold under agreements to repurchase 2,574,844 Trading liabilities 1,732,397 Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases....... 1,755,445 Bank's liability on acceptances executed and outstanding 689,067 Subordinated notes and debentures............... 1,646,000 Other liabilities............................... 5,441,990 Total liabilities............................... 67,473,981 Minority interest in consolidated subsidiaries 652 EQUITY CAPITAL - -------------- Common stock 1,135,284 Surplus 1,050,729 Retained earnings 4,480,524 Accumulated other comprehensive income -13,452 Other equity capital components 0 Total equity capital 6,653,085 ------------ Total liabilities, minority interest, and equity capital $ 74,127,718 ============ EXHIBIT 7 (Page 3 of 3) I, Thomas J. Mastro, Senior Vice President and Comptroller of the above-named bank do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true to the best of my knowledge and belief. Thomas J. Mastro Senior Vice President and Comptroller We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true and correct. Thomas A. Renyi ) Gerald L. Hassell ) Directors Alan R. Griffith ) EX-25 17 e432003v1.txt EXHIBIT 25(B) EXHIBIT 25(b) SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------------- FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)____________ ------------------- THE BANK OF NEW YORK (Exact name of trustee as specified in its charter) New York 13-5160382 (Jurisdiction of incorporation (I.R.S. Employer if not a U.S. national bank) Identification No.) One Wall Street, New York, New York 10286 (Address of principal executive offices) (Zip code) ------------------- DPL INC. (Exact name of obligor as specified in its charter) Ohio 31-1163136 (State or other jurisdiction (I.R.S. Employer of incorporation or organization Identification No.) Courthouse Plaza Southwest Dayton, Ohio 45402 (Address of principal executive offices) (Zip code) ------------------- 8 1/8 % JUNIOR SUBORDINATED DEBENTURES (Title of the indenture securities) ITEM 1. GENERAL INFORMATION.* Furnish the following information as to the Trustee: (a) Name and address of each examining or supervising authority to which it is subject. Superintendent of Banks of the 2 Rector Street, New York, N.Y. 10006 State of New York and Albany, N.Y. 12203 Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y. 10045 Federal Deposit Insurance Corporation 550 17th Street, N.W., Washington, D.C. 20429 New York Clearing House Association New York, N.Y. (b) Whether it is authorized to exercise corporate trust powers. Yes. ITEM 2. AFFILIATIONS WITH OBLIGOR. If the obligor is an affiliate of the trustee, describe each such affiliation. None. (See Note on page 2.) ITEM 16. LIST OF EXHIBITS. Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the "Act") and Rule 24 of the Commission's Rules of Practice. 1. - A copy of the Organization Certificate of The Bank of New York (formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits la and lb to Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637.) 4. - A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 33-31019.) 6. - The consent of the Trustee required by Section 321(b) of the Act. (Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.) 7. - A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority. - --------------- * Pursuant to General Instruction B, the Trustee has responded only to Items 1, 2 and 16 of this form since to the best of the knowledge of the Trustee the obligor is not in default under any indenture under which the Trustee is a trustee. NOTE Inasmuch as this Form T-1 is being filed prior to the ascertainment by the Trustee of all facts on which to base a responsive answer to Item 2, the answer to said Item is based on incomplete information. Item 2 may, however, be considered as correct unless amended by an amendment to this Form T-1. SIGNATURE Pursuant to the requirements of the Act, the Trustee, The Bank of New York, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 20th day of November, 2001. THE BANK OF NEW YORK By:/s/ PAUL J. SCHMALZEL ----------------------------------- Paul J. Schmalzel Vice President EXHIBIT 7 (Page 1 of 3) Consolidated Report of Condition of THE BANK OF NEW YORK of One Wall Street, New York, N.Y. 10286 And Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business June 30, 2001, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act. Dollar Amounts ASSETS in Thousands - ------ -------------- Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin....................... $ 3,946,551 Interest-bearing balances....................... 5,454,795 Securities: Held-to-maturity securities 127,189 Available-for-sale securities................... 8,367,798 Federal funds sold and Securities purchased under agreements to resell............ 2,578,045 Loans and lease financing receivables: Loans and leases held for sale..................... 15,750 Loans and leases, net of unearned Income..................................... 37,240,401 LESS: Allowance for loan and lease losses............................... 604,286 Loans and leases, net of unearned income and allowance....................... 36,636,115 Trading Assets..................................... 9,717,521 Premises and fixed assets (including capitalized leases)........................... 777,125 Other real estate owned............................ 1,190 Investments in unconsolidated subsidiaries and associated companies...................... 197,938 Customers' liability to this bank on acceptances outstanding....................... 684,954 Intangible assets Goodwill...................................... 1,516,774 Other intangible assets....................... 118,954 Other assets....................................... 3,987,019 -------------- Total assets....................................... $ 74,127,718 ============== EXHIBIT 7 (Page 2 of 3) LIABILITIES Deposits: In domestic offices............................. $ 27,176,888 Noninterest-bearing............................. 11,540,657 Interest-bearing balances....................... 15,636,231 In foreign offices, Edge and Agreement subsidiaries, and IBFs................ 26,457,350 Noninterest-bearing............................. 462,578 Interest-bearing................................ 25,994,772 Federal funds purchased and securities sold under agreements to repurchase............. 2,574,844 Trading liabilities................................ 1,732,397 Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases........... 1,755,445 Bank's liability on acceptances executed and outstanding....................... 689,067 Subordinated notes and debenture................... 1,646,000 Other liabilities.................................. 5,441,990 -------------- Total liabilities.................................. 67,473,981 ============== Minority interest in consolidated subsidiaries.................................. 652 EQUITY CAPITAL Common Stock....................................... 1,135,284 Surplus............................................ 1,050,729 Retained earnings.................................. 4,480,524 Accumulated other comprehensive income............. -13,452 Other equity capital components.................... 0 Total equity capital............................... 6,653,085 -------------- Total liabilities, minority interest, and equity capital.............................. $ 74,127,718 ============== EXHIBIT 7 (Page 3 of 3) I, Thomas J. Mastro, Senior Vice President and Comptroller of the above-named bank do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true to the best of my knowledge and belief. Thomas J. Mastro Senior Vice President and Comptroller We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true and correct. Thomas A. Renyi ) Gerald L. Hassell ) Directors Alan R. Griffith ) EX-25 18 e431999v1.txt EXHIBIT 25(C) EXHIBIT 25(C) SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 -------------------- FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) ___________ -------------------- THE BANK OF NEW YORK (Exact name of trustee as specified in its charter) New York 13-5160382 (Jurisdiction of incorporation (I.R.S. Employer if not a U.S. national bank) Identification No.) One Wall Street, New York, New York 10286 (Address of principal executive offices) (Zip code) -------------------- DPL INC. (Exact name of obligor as specified in its charter) Ohio 31-1163136 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) Courthouse Plaza Southwest Dayton, Ohio 45402 (Address of principal executive offices) (Zip code) -------------------- GUARANTEE OF DPL INC. WITH RESPECT TO 8 1/8% CAPITAL SECURITIES OF DPL CAPITAL TRUST II (Title of the indenture securities) ITEM 1. GENERAL INFORMATION.* Furnish the following information as to the Trustee: (a) Name and address of each examining or supervising authority to which it is subject. Superintendent of Banks of the 2 Rector Street, New York, N.Y. 10006 State of New York and Albany, N.Y. 12203 Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y. 10045 Federal Deposit Insurance Corporation 550 17th Street, N.W., Washington, D.C. 20429 New York Clearing House Association New York, N.Y. (b) Whether it is authorized to exercise corporate trust powers. Yes. ITEM 2. AFFILIATIONS WITH OBLIGOR. If the obligor is an affiliate of the trustee, describe each such affiliation. None. (See Note on page 2.) ITEM 16. LIST OF EXHIBITS. Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the "Act") and Rule 24 of the Commission's Rules of Practice. 1. A copy of the Organization Certificate of The Bank of New York (formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637.) 4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 33-31019.) 6. The consent of the Trustee required by Section 321(b) of the Act. (Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.) - ------------- * Pursuant to General Instruction B, the Trustee has responded only to Items 1, 2 and 16 of this form since to the best of the knowledge of the Trustee the obligor is not in default under any indenture under which the Trustee is a trustee. 7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority. NOTE Inasmuch as this Form T-1 is being filed prior to the ascertainment by the Trustee of all facts on which to base a responsive answer to Item 2, the answer to said Item is based on incomplete information. Item 2 may, however, be considered as correct unless amended by an amendment to this Form T-1. SIGNATURE Pursuant to the requirements of the Act, the Trustee, The Bank of New York, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 20th day of November, 2001. THE BANK OF NEW YORK By: /s/ PAUL J. SCHMALZEL --------------------------------------- Paul J. Schmalzel Vice President EXHIBIT 7 (Page 1 of 3) Consolidated Report of Condition of THE BANK OF NEW YORK of One Wall Street, New York, N.Y. 10286 And Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business June 30, 2001, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts ASSETS in Thousands - ------ ------------ Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin ............... $ 3,946,551 Interest-bearing balances ........................................ 5,454,795 Securities: Held-to-maturity securities ...................................... 127,189 Available-for-sale securities .................................... 8,367,798 Federal funds sold and Securities purchased under agreements to resell 2,578,045 Loans and lease financing receivables: Loans and leases held for sale ........................................ 15,750 Loans and leases, net of unearned Income ............................ 37,240,401 LESS: Allowance for loan and lease losses ............................... 604,286 Loans and leases, net of unearned income and allowance 36,636,115 Trading Assets ........................................................ 9,717,521 Premises and fixed assets (including capitalized leases) .............. 777,125 Other real estate owned ............................................... 1,190 Investments in unconsolidated subsidiaries and associated companies ... 197,938 Customers' liability to this bank on acceptances outstanding 684,954 Intangible assets Goodwill ......................................................... 1,516,774 Other intangible assets .......................................... 118,954 Other assets .......................................................... 3,987,019 ------------- Total assets........................................................... $ 74,127,718 ============= EXHIBIT 7 (Page 2 of 3) LIABILITIES Deposits: In domestic offices .............................................. $27,176,888 Noninterest-bearing ............................ 11,540,657 Interest-bearing ............................... 15,636,231 In foreign offices, Edge and Agreement subsidiaries, and IBFs .... 26,457,350 Noninterest-bearing ............................ 462,578 Interest-bearing ............................... 25,994,772 Federal funds purchased and securities 2,574,844 sold under agreements to repurchase .............................. Trading liabilities ................................................... 1,732,397 Other borrowed money: (includes mortgage indebtedness and obligations under capitalized 1,755,445 leases) ...................................................... Bank's liability on acceptances executed and outstanding .............. 689,067 Subordinated notes and debentures ..................................... 1,646,000 Other liabilities ..................................................... 5,441,990 ------------- Total liabilities ..................................................... 67,473,981 ------------- Minority interest in consolidated subsidiaries ........................ EQUITY CAPITAL Common stock .......................................................... 1,135,284 Surplus ............................................................... 1,050,729 Retained earnings ..................................................... 4,480,524 Accumulated other comprehensive income ................................ -13,452 Other equity capital components ....................................... 0 Total equity capital .................................................. 6,653,085 ------------ Total liabilities, minority interest, and equity capital .............. $74,127,718 ===========
EXHIBIT 7 (Page 3 of 3) I, Thomas J. Mastro, Senior Vice President and Comptroller of the above-named bank do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true to the best of my knowledge and belief. Thomas J. Mastro Senior Vice President and Comptroller We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true and correct. Thomas A. Renyi ) Gerald L. Hassell ) Directors Alan R. Griffith ) EX-99 19 e431502v1.txt EXHIBIT 99(A) EXHIBIT 99(a) FORM OF EXCHANGE AGENT AGREEMENT THIS EXCHANGE AGENT AGREEMENT (this "Agreement") is made and entered into as of _______ __, 2002, by and between DPL Capital Trust II, a statutory business trust formed under the laws of the State of Delaware (the "Issuer"), and Bank One Trust Company, National Association, a national banking association incorporated and existing under the laws of the United States of America, as exchange agent (the "Exchange Agent"). RECITALS The Issuer proposes to make an offer to exchange, upon the terms and subject to the conditions set forth in the Issuer's and DPL Inc.'s, an Ohio corporation (the "Company")Prospectus dated October __, 2001 (the "Prospectus"), and the accompanying letter of transmittal (the "Letter of Transmittal"), forms of which are attached hereto as Exhibits A and B, respectively (and which, taken ---------------- together, constitute the "Exchange Offer"), its outstanding 8 1/8% Capital Securities (the "Old Securities") for an equal principal amount of its registered 8 1/8% Capital Securities (the "New Securities" and, together with the Old Securities, the "Securities"). The Exchange Offer will commence as soon as practicable after the Issuer's and Company's Registration Statement on Form S-4 relating to the Exchange Offer is declared effective under the Securities Act of 1933, as certified in writing to Exchange Agent by the Issuer or the Company (the "Effective Time") and shall terminate at 5:00 p.m., New York City time, on __________, 2001 (the "Expiration Date"), unless the Exchange Offer is extended by the Issuer and the Issuer notifies Exchange Agent of such extension by 5:00 p.m., New York City time, on the previous Expiration Date, in which case, the term "Expiration Date" shall mean the latest date and time to which the Exchange Offer is extended. In connection therewith, the undersigned parties hereby agree as follows: 1. Appointment and Duties as Exchange Agent. Issuer hereby authorizes Bank ---------------------------------------- One Trust Company, National Association, to act as Exchange Agent in connection with the Exchange Offer, and Bank One Trust Company, National Association, hereby agrees to act as Exchange Agent and to perform the services outlined herein in connection with the Exchange Offer on the terms and conditions contained herein. 2. Mailing to Holders of the Old Securities. A. As soon as practicable ---------------------------------------- after its receipt of certification from the Issuer as to the Effective Time, Exchange Agent will mail to each Holder (as defined in the Indenture), and to each DTC participant identified by DTC as a holder of any Old Securities (i) a Letter of Transmittal with instructions (including instructions for completing a substitute Form W-9), (ii) a Prospectus and (iii) a Notice of Guaranteed Delivery substantially in the form attached hereto as Exhibit C (the "Notice of --------- Guaranteed Delivery") all in accordance with the procedures described in the Prospectus. B. Issuer shall supply Exchange Agent with sufficient copies of the Prospectus, the Letter of Transmittal and the Notice of Guaranteed Delivery to enable Exchange Agent to perform its duties hereunder. Issuer shall also furnish or cause to be furnished to Exchange Agent a list of the holders of the Old Securities (including a beneficial holder list from The Depository Trust Company ("DTC"), certificated Old Securities numbers and amounts, mailing addresses, and social security numbers), unless waived by Exchange Agent. 3. ATOP Registration. As soon as practicable, Exchange Agent shall ----------------- establish an account with DTC in its name to facilitate book-entry tenders of Old Securities through DTC's Automated Tender Offer Program ("ATOP") for the Exchange Offer. 4. Receipt of Letters of Transmittal and Related Items. From and after the --------------------------------------------------- Effective Time, Exchange Agent is hereby authorized and directed to accept (i) Letters of Transmittal, duly executed in accordance with the instructions thereto (or a manually signed facsimile thereof), and any requisite collateral documents from Holders of the Old Securities and (ii) surrendered Old Securities to which such Letters of Transmittal relate. Exchange Agent is authorized to request from any person tendering Old Securities such additional documents as Exchange Agent or the Issuer deems appropriate. Exchange Agent is hereby authorized and directed to process withdrawals of tenders to the extent withdrawal thereof is permitted by the Exchange Offer. 5. Defective or Deficient Old Securities and Instruments. A. As soon as ----------------------------------------------------- practicable after receipt, Exchange Agent will examine instructions transmitted by DTC ("DTC Transmissions"), Old Securities, Letters of Transmittal and other documents received by Exchange Agent in connection with tenders of Old Securities to ascertain whether (i) the Letters of Transmittal are completed and executed in accordance with the instructions set forth therein (or that the DTC Transmissions contain the proper information required to be set forth therein), (ii) the Old Securities have otherwise been properly tendered in accordance with the Prospectus and the Letters of Transmittal (or that book-entry confirmations are in due and proper form and contain the information required to be set forth therein) and (iii) if applicable, the other documents (including the Notice of Guaranteed Delivery) are properly completed and executed. B. If any Letter of Transmittal or other document has been improperly completed or executed (or any DTC Transmissions are not in due and proper form or omit required information) or the Old Securities accompanying such Letter of Transmittal are not in proper form for transfer or have been improperly tendered (or the book-entry confirmations are not in due and proper form or omit required information) or if some other irregularity in connection with any tender of any Old Securities exists, Exchange Agent shall promptly report such information to the Holder. If such condition is not promptly remedied by the Holder, Exchange Agent shall report such condition to the Issuer and await its direction. All questions as to the validity, form, eligibility (including timeliness of receipt), acceptance and withdrawal of any Old Securities tendered or delivered shall be determined by the Issuer, in its sole discretion. Notwithstanding the above, Exchange Agent shall not incur any liability for failure to give such notification unless such failure constitutes negligence or willful misconduct. C. The Issuer reserves the absolute right (i) to reject any or all tenders of any particular Old Securities determined by the Issuer not to be in proper form or the acceptance or exchange of which may, in the opinion of Issuer's counsel, be unlawful and (ii) to waive any of the conditions of the Exchange Offer or any defect or irregularity in the tender of any particular Old Securities, and the Issuer's interpretation of the terms and conditions of the Exchange Offer 2 (including the Letter of Transmittal and Notice of Guaranteed Delivery and the instructions set forth therein) will be final and binding. 6. Requirements of Tenders. A. Tenders of Old Securities shall be made only ----------------------- as set forth in the Letter of Transmittal, and shall be considered properly tendered only when tendered in accordance therewith. Notwithstanding the provisions of this paragraph, any Old Securities that any Administrative Trustee of the Trust or Designated Officer of the Company, shall approve as having been properly tendered shall be considered to be properly tendered. B. Exchange Agent shall (a) ensure that each Letter of Transmittal and the related Old Securities or a bond power are duly executed (with signatures guaranteed where required) by the appropriate parties in accordance with the terms of the Exchange Offer; (b) in those instances where the person executing the Letter of Transmittal (as indicated on the Letter of Transmittal) is acting in a fiduciary or a representative capacity, ensure that proper evidence of his or her authority so to act is submitted; and (c) in those instances where the Old Securities are tendered by persons other than the registered holder of such Old Securities, ensure that customary transfer requirements, including any applicable transfer taxes, and the requirements imposed by the transfer restrictions on the Old Securities (including any applicable requirements for certifications, legal opinions or other information) are fulfilled. 7. Exchange of the Old Securities. A. Promptly after the Effective Time, ------------------------------ the Issuer will deliver the New Securities to the Exchange Agent. Upon surrender of the Old Securities properly tendered in accordance with the Exchange Offer, Exchange Agent is hereby directed to deliver or cause to be delivered New Securities to the Holders of such surrendered Old Securities. The principal amount of the New Securities to be delivered to a Holder shall equal the principal amount of the Old Securities surrendered. B. The New Securities issued in exchange for certificated Old Securities shall be mailed by Exchange Agent, in accordance with the instructions contained in the Letter of Transmittal, by first class or registered mail, and under coverage of Exchange Agent's blanket surety bond for first class or registered mail losses protecting the Issuer from loss or liability arising out of the non-receipt or non-delivery of such New Securities or the replacement thereof. C. Notwithstanding any other provision of this Agreement, issuance of the New Securities for accepted Old Securities pursuant to the Exchange Offer shall be made only after deposit with Exchange Agent of the Old Securities, the related Letter of Transmittal and any other required documents. 8. Securities Held in Trust. The New Securities and any cash or other ------------------------ property (the "Property") deposited with or received by Exchange Agent (in such capacity) from the Issuer shall be held in a segregated account, solely for the benefit of Issuer and Holders tendering Old Securities, as their interests may appear, and the Property shall not be commingled with securities, money, assets or property of Exchange Agent or any other party. Exchange Agent hereby waives any and all rights of lien, if any, against the Property, except to the extent set forth in the Indenture with respect to the New Securities. 9. Reports to Issuer. Exchange Agent shall regularly notify, by facsimile ----------------- or electronic 3 communication, the Issuer as to the principal amount of the Old Securities which have been duly tendered since the previous report and the aggregate amount tendered since the Effective Date on a weekly basis until the Expiration Date. Such notice shall be delivered in substantially the form set forth as Exhibit D. 10. Record Keeping. Each Letter of Transmittal, Old Security and any other -------------- documents received by Exchange Agent in connection with the Exchange Offer shall be stamped by Exchange Agent to show the date of receipt (or if Old Securities are tendered by book-entry delivery, such form of record keeping of receipt as is customary for tenders through ATOP) and, if defective, the date and time the last defect was cured or waived by the Issuer. Exchange Agent shall cancel certificated Old Securities. Exchange Agent shall retain all Old Securities and Letters of Transmittal and other related documents or correspondence received by Exchange Agent until the Expiration Date. Exchange Agent shall return all such material to Issuer as soon as practicable after the Expiration Date. If Exchange Agent receives any Letters of Transmittal after the Expiration Date, Exchange Agent shall return the same together with all enclosures to the party from whom such documents were received. 11. Discrepancies or Questions. Any discrepancies or questions regarding -------------------------- any Letter of Transmittal, Old Security, notice of withdrawal or any other documents received by Exchange Agent in connection with the Exchange Offer shall be referred to Issuer and the Company and Exchange Agent shall have no further duty with respect to such matter; provided that Exchange Agent shall cooperate -------- with Issuer and the Company in attempting to resolve such discrepancies or questions. 12. Transfer of Registration. New Securities may be registered in a name ------------------------ other than that of the record Holder of a surrendered Old Security, if and only if (i) the Old Security surrendered shall be properly endorsed (either by the registered Holder thereof or by a properly completed separate power with such endorsement guaranteed by an Eligible Institution, as defined in the Letter of Transmittal and otherwise in proper form for transfer, (ii) the person requesting such transfer of registration shall pay to Exchange Agent any transfer or other taxes required, or shall establish to Exchange Agent's satisfaction that such tax is not owed or has been paid and (iii) the such other documents and instruments as Issuer or Exchange Agent require shall be received by Exchange Agent. 13. Partial Tenders. If, pursuant to the Exchange Offer, less than all of --------------- the principal amount of any Old Security submitted to Exchange Agent is tendered, Exchange Agent shall, promptly after the Expiration Date, return, or cause the registrar with respect to each such Old Security to return, a new Old Security for the principal amount not being tendered to, or in accordance with the instruction of, the Holder who has made a partial tender. 14. Withdrawals. A tendering Holder may withdraw tendered Old Securities as ----------- set forth in the Prospectus, in which event Exchange Agent shall, after proper notification of such withdrawal, return such Old Securities to, or in accordance with the instructions of, such Holder and such Old Securities shall no longer be considered properly tendered. Any withdrawn Old Securities may be tendered again by following the procedures therefor described in the Prospectus at any time on or prior to the Expiration Date. 4 15. Rejection of Tenders. If, pursuant to the Exchange Offer, Issuer does -------------------- not accept for exchange all of the Old Securities tendered by a Holder of Old Securities, Exchange Agent shall return or cause to be returned such Old Securities to, or in accordance with the instructions of, such Holder of Old Securities. 16. Cancellation of Exchanged Old Securities. Exchange Agent is authorized ---------------------------------------- and directed to cancel all Old Securities received by it upon delivering the New Securities to tendering holders of the Old Securities as provided herein. Exchange Agent shall maintain a record as to which Old Securities have been exchanged pursuant to Section 7 hereof. 17. Requests for Information. Exchange Agent shall accept and comply with ------------------------ telephone and mail requests for information from any person concerning the proper procedure to tender Old Securities. Exchange Agent shall provide copies of the Prospectus, Letter of Transmittal and Notice of Guaranteed Delivery to any person upon request. All other requests for materials shall be referred to the Issuer and the Company. Exchange Agent shall not offer any concessions or pay any commissions or solicitation fees to any brokers, dealers, banks or other persons or engage any persons to solicit tenders. 18. Tax Matters. Any questions with respect to any tax matters relating to ----------- the Exchange Offer shall be referred to Issuer and the Company, and Exchange Agent shall have no duty with respect to any such matter; provided that Exchange Agent shall cooperate with Issuer and the Company in attempting to resolve such questions. 19. Reports. Within 5 days after the Expiration Date, Exchange Agent shall ------- furnish the Issuer and the Company a final report showing the disposition of the New Securities. 20. Fees and Expenses. Issuer will pay Exchange Agent its fees plus ----------------- expenses, including counsel fees and disbursements, as set forth in Exhibit E. 21. Concerning the Exchange Agent. As exchange agent hereunder, Exchange ----------------------------- Agent: A. shall have no duties or obligations other than those specifically set forth in this Agreement; B. will make no representation and will have no responsibility as to the validity, value or genuineness of the Exchange Offer, shall not make any recommendation as to whether a Holder of Old Securities should or should not tender its Old Securities and shall not solicit any Holder for the purpose of causing such Holder to tender its Old Securities; C. shall not be obligated to take any action hereunder which may, in Exchange Agent's sole judgment, involve any expense or liability to Exchange Agent unless it shall have been furnished with indemnity against such expense or liability which, in Exchange Agent's sole judgment, is adequate; D. may rely on and shall be protected in acting upon any certificate, instrument, opinion, notice, instruction, letter, telegram or other document, or any security, delivered to Exchange Agent and believed by Exchange Agent to be genuine and to have been signed by the proper party or parties; 5 E. may rely on and shall be protected in acting upon the written instructions of Issuer, its counsel, or its representatives; F. shall not be liable for any claim, loss, liability or expense, incurred without Exchange Agent's negligence or willful misconduct, arising out of or in connection with the administration of Exchange Agent's duties hereunder; and G. may consult with counsel, and the advice of such counsel or any opinion of counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by Exchange Agent hereunder in accordance with the advice of such counsel or any opinion of counsel. 22. Indemnification. A. Issuer and the Company jointly and severally --------------- covenants and agrees to indemnify and hold harmless Exchange Agent, its directors, officers, employees and agents (the "Indemnified Persons") against any and all losses, damages, costs or expenses (including reasonable attorneys' fees and court costs), arising out of or attributable to its acceptance of appointment as Exchange Agent hereunder, provided that such indemnification shall not apply to losses, damages, costs or expenses incurred due to negligence or willful misconduct of the Exchange Agent. Exchange Agent shall notify Issuer and the Company in writing of any written asserted claim against Exchange Agent or of any other action commenced against Exchange Agent, reasonably promptly after Exchange Agent shall have received any such written assertion or shall have been served with a summons in connection therewith. Issuer and the Company shall be entitled to participate at its own expense in the defense of any such claim or other action and, if Issuer or the Company so elects, Issuer or the Company may assume the defense of any pending or threatened action against Exchange Agent in respect of which indemnification may be sought hereunder; provided that neither the Issuer nor the Company shall be entitled to assume the - -------- defense of any such action if the named parties to such action include both the Issuer or the Company and Exchange Agent and representation of both parties by the same legal counsel would, in the written opinion of counsel for Exchange Agent, be inappropriate due to actual or potential conflicting interests between them; and further provided that in the event Issuer or the Company shall -------------------- assume the defense of any such suit, and such defense is reasonably satisfactory to Exchange Agent, neither Issuer nor the Company shall therewith be liable for the fees and expenses of any counsel retained by Exchange Agent. B. Exchange Agent agrees that, without the prior written consent of Issuer (which consent shall not be unreasonably withheld), it will not settle, compromise or consent to the entry of any judgment in any pending or threatened claim, action or proceeding in respect of which indemnification could be sought in accordance with the indemnification provision of this Agreement (whether or not any Indemnified Persons is an actual or potential party to such claim, action or proceeding). 23. Applicable Law. This Agreement shall be construed and enforced in -------------- accordance with the laws of the State of New York, without regard to conflicts of laws principles. 24. Notices. Notices or other communications pursuant to this Agreement ------- shall be delivered by facsimile transmission, reliable overnight courier or by first-class mail, postage prepaid, addressed as follows: 6 To Issuer at: DPL Capital Trust II c/o DPL Inc. Courthouse Plaza Southwest Dayton, Ohio 45402 Attention: Financial Activities Fax: (937) 259-7147 Telephone: (937) 224-6000 Or to Exchange Agent at: Bank One Trust Company, National Association One North State Street, 9th Floor Chicago, IL 60602 Attention: Exchanges Fax: (312) 407-8853 Telephone: (800) 524-9472 Or to such address as either party shall provide by notice to the other party. 25. Change of Exchange Agent. Exchange Agent may resign from its duties ------------------------ under this Agreement by giving to Issuer and the Company thirty days prior written notice. If Exchange Agent resigns or becomes incapable of acting as Exchange Agent and the Issuer fails to appoint a new exchange agent within a period of 30 days after it has been notified in writing of such resignation or incapacity by Exchange Agent, the Issuer shall appoint a successor exchange agent or assume all of the duties and responsibilities of Exchange Agent. Any successor exchange agent shall be vested with the same powers, rights, duties and responsibilities as if it had been originally named as Exchange Agent without any further act or deed; but Exchange Agent shall deliver and transfer to the successor exchange agent any Property at the time held by it hereunder, and execute and deliver any further assurance, conveyance, act or deed necessary for such purpose. 26. Miscellaneous. Neither party may transfer or assign its rights or ------------- responsibilities under this Agreement without the written consent of the other party hereto; provided, however, that Exchange Agent may transfer and assign its rights and responsibilities hereunder to any of its affiliates otherwise eligible to act as Exchange Agent and, upon 45 days prior written notice to Exchange Agent, Issuer may transfer and assign its rights and responsibilities hereunder to any successor by merger, any purchaser of all of the common stock of Issuer, or any purchaser of all or substantially all of Issuer's assets. This Agreement may be amended only in writing signed by both parties. Any New Securities which remain undistributed after the Expiration Date shall be cancelled and delivered to the Issuer upon demand, and any Old Securities which are tendered thereafter shall be returned by Exchange Agent to the tendering party. Except for Sections 20 and 22, this Agreement shall terminate on the 31st day after the Expiration Date. 27. Advertisements. Issuer agrees to place advertisements regarding the -------------- Exchange Offer in The Wall Street Journal, The Bond Buyer and Bloomberg as soon as practicable following the Effective Date. 7 28. Parties in Interest. This Agreement shall be binding upon and inure ------------------- solely to the benefit of each party hereto and nothing in this Agreement, express or implied, is intended to or shall confer upon any other person any right, benefits or remedy of any nature whatsoever under or by reason of this Agreement. Without limitation to the foregoing, the parties hereto expressly agree that no Holder or holder of Securities shall have any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement. 29. Entire Agreement; Headings. This Agreement constitutes the entire -------------------------- understanding of the parties hereto with respect to the subject matter hereof. The descriptive headings contained in this Agreement are included for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement. 30. Counterparts. This Agreement may be executed in any number of ------------ counterparts, each of which shall be deemed an original, and all of such counterparts together shall constitute one and the same instrument. 8 IN WITNESS WHEREOF, Issuer and Exchange Agent have caused this Agreement to be signed by their respective officers thereunto authorized as of the date first written above. DPL Capital Trust II By:__________________________________ Name: Title: BANK ONE TRUST COMPANY, National Association By:__________________________________ Name: Title: 9 EXHIBIT D Date: _______________________ DPL CAPITAL TRUST II DPL INC. BY FAX: ________________________ Re: Notice of Tenders With respect to Section 9 of the Exchange Agent Agreement, dated as of _______________, 2001, we confirm the following information as of the date hereof: 1. Principal amount of Old Securities tendered during the past week: $____________________ 2. Principal amount of Old Securities referred to in paragraph 1. above regarding which Exchange Agent questions validity of the tender: $____________________ 3. Aggregate principal amount of Old Securities tendered since the Effective Date as to which Exchange Agent questions the validity of the tender: $___________________. 4. Principal amount of Old Securities remaining unpresented (based on $___,000,000 total Old Securities): $__________________ 5. Total aggregate principal amount of Old Securities validly tendered since the Effective Date: $_______________ Bank One Trust Company, National Association, as Exchange Agent By: ------------------------------- Name: Title: 10 EXHIBIT E Schedule of Fees Per letter of transmittal mailed: $___.00 Minimum fee: $_____.00 Extraordinary services and special requests: by appraisal Out of pocket expenses incurred will be billed for reimbursement at invoiced cost The minimum fee of $_____.00 shall be due and payable upon execution of the Exchange Agent Agreement. The remaining balance shall be due and payable upon receipt of Exchange Agent's invoice therefor. 11 EX-99 20 e431492v1.txt EXHIBIT 99(B) EXHIBIT 99(B) NOTICE OF GUARANTEED DELIVERY FOR TENDER OF 8 1/8% CAPITAL SECURITIES (CUSIP NO.23330AAA8 and U26057AA4) (ISIN NO. US23330AAA88 and USU26057AA40) OF DPL CAPITAL TRUST II DPL INC. This Notice of Guaranteed Delivery or one substantially equivalent hereto must be used to accept the Exchange Offer (as defined below) if (i) certificates for the Trust's (as defined below) 8 1/8% Capital Securities (the "Old Capital Securities") are not immediately available, (ii) Old Capital Securities, the Letter of Transmittal and any other documents required by the Letter of Transmittal cannot be delivered to Bank One Trust Company, National Association (the "Exchange Agent") on or prior to the Expiration Date (as defined in the Prospectus referred to below) or (iii) the procedures for book-entry transfer cannot be completed on a timely basis. This Notice of Guaranteed Delivery may be delivered by hand or sent by facsimile transmission, overnight courier, telex, telegram or mail to the Exchange Agent. See "The Exchange Offer - Guaranteed Delivery Procedures" in the Prospectus dated _________ __, 2001 (which, together with the related Letter of Transmittal, constitutes the "Exchange Offer") of DPL Capital Trust II, a statutory business trust formed under the laws of the State of Delaware (the "Trust") and DPL Inc., an Ohio corporation (the "Company"). The Exchange Agent for the Exchange Offer is: Bank One Trust Company, National Association By Hand or Facsimile By Registered or Overnight Delivery: Transmissions: Certified Mail: Bank One Trust Company, 312-407-8853 Bank One Trust Company, National Association To Confirm National Association One North State Street, by Telephone One North State Street, 9th Floor or for 9th Floor Chicago, Illinois 60602 Information Call: Chicago, Illinois 60602 800-524-9472 Attn: Exchanges Attn: Exchanges DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF THIS NOTICE OF GUARANTEED DELIVERY VIA A FACSIMILE TRANSMISSION TO A NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. THIS NOTICE OF GUARANTEED DELIVERY IS NOT TO BE USED TO GUARANTEE SIGNATURES. IF A SIGNATURE ON A LETTER OF TRANSMITTAL IS REQUIRED TO BE GUARANTEED BY AN "ELIGIBLE INSTITUTION" UNDER THE INSTRUCTIONS THERETO, SUCH SIGNATURE GUARANTEE MUST APPEAR IN THE APPLICABLE SPACE PROVIDED ON THE LETTER OF TRANSMITTAL. THE FOLLOWING GUARANTEE MUST BE COMPLETED GUARANTEE OF DELIVERY (Not to be used for Signature Guarantee) The undersigned, a firm that is a member of a registered national securities exchange or a member of the National Association of Securities Dealers, Inc. or a commercial bank or trust company having an office or correspondent in the United States, hereby guarantees to deliver to the Exchange Agent, at one of its addresses set forth above, either the certificates for all physically tendered Old Capital Securities, in proper form for transfer, or confirmation of the book-entry transfer of such Old Capital Securities to the Exchange Agent's account at The Depository Trust Company ("DTC"), pursuant to the procedures for book-entry transfer set forth in the Prospectus, in either case together with any other documents required by the Letter of Transmittal, within five New York Stock Exchange trading days after the date of execution of this Notice of Guaranteed Delivery. The undersigned acknowledges that it must deliver the Old Capital Securities tendered hereby to the Exchange Agent within the time period set forth above and that failure to do so could result in a financial loss to the undersigned. Name of Firm: __________________________ ___________________________________ (Authorized Signature) Address:________________________________ Title:_____________________________ ________________________________________ Name:______________________________ (Zip Code) (Please Type or Print) Area Code and Telephone Number: Date:______________________________ ________________________________________ NOTE: DO NOT SEND OLD CAPITAL SECURITIES WITH THIS NOTICE OF GUARANTEED DELIVERY. ACTUAL SURRENDER OF OLD CAPITAL SECURITIES MUST BE MADE PURSUANT TO, AND BE ACCOMPANIED BY, A PROPERLY COMPLETED AND FULLY EXECUTED LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS. 2 EX-99 21 e431574v1.txt EXHIBIT 99(C) EXHIBIT 99(c) LETTER OF TRANSMITTAL DPL CAPITAL TRUST II OFFER TO EXCHANGE 8 1/8% CAPITAL SECURITIES (REGISTERED) FOR ANY AND ALL OUTSTANDING 8 1/8% CAPITAL SECURITIES (UNREGISTERED) UNCONDITIONALLY GUARANTEED BY DPL INC. PURSUANT TO THE PROSPECTUS DATED ________ ___, 2002 - -------------------------------------------------------------------------------- THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON _______ __, 2001, UNLESS THE OFFER IS EXTENDED. - -------------------------------------------------------------------------------- Deliver to: BANK ONE TRUST COMPANY, NATIONAL ASSOCIATION By Registered or Certified Mail: By Overnight Delivery or Hand: One North State Street One North State Street 9th Floor 9th Floor Chicago, Illinois 60602 Chicago, Illinois 60602 Attn: Exchanges Attn: Exchanges To Confirm by Telephone Facsimile Transmissions: or for Information: (800) 524-9472 (312) 407-8853 DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL VIA FACSIMILE TO A NUMBER OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY. THE INSTRUCTIONS CONTAINED HEREIN SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED. Capitalized terms used but not defined herein shall have the same meaning given them in the Prospectus (as defined below). This Letter of Transmittal is to be completed by holders of Old Capital Securities (as defined below) if Old Capital Securities are to be forwarded herewith or delivered by book-entry transfer as provided herein. If tenders of Old Capital Securities are to be made by book-entry transfer to an account maintained by Bank One Trust Company, National Association (the "Exchange Agent") at The Depository Trust Company ("DTC") pursuant to the procedures set forth in "The Exchange Offer--Book-Entry Transfer" in the Prospectus and in accordance with the Automated Tender Offer Program ("ATOP") established by DTC, a tendering holder will become bound by the terms and conditions hereof in accordance with the procedures established under ATOP. Holders of Old Capital Securities whose certificates (the "certificates") for such Old Capital Securities are not immediately available or who cannot deliver their certificates and all other required documents to the Exchange Agent on or prior to the expiration date (as defined in the Prospectus) or who cannot complete the procedures for book-entry transfer on a timely basis, must tender their Old Capital Securities according to the guaranteed delivery procedures set forth in "The Exchange Offer--Guaranteed Delivery Procedures" in the Prospectus. SEE INSTRUCTION 1. DELIVERY OF DOCUMENTS TO DTC IN ACCORDANCE WITH ITS PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT. NOTE: SIGNATURES MUST BE PROVIDED BELOW PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
- -------------------------------------------------------------------------------------------------------- ALL TENDERING HOLDERS COMPLETE THIS BOX: - -------------------------------------------------------------------------------------------------------- DESCRIPTION OF OLD CAPITAL SECURITIES TENDERED - -------------------------------------------------------------------------------------------------------- Name(s) and address(es) of Registered Holder(s) Old Capital Securities Tendered (Please fill in, if blank) (attach additional list if necessary) - -------------------------------------------------------------------------------------------------------- Principal Amount of Old Capital Securities Principal Amount of Tendered (if less than Old Capital all)** Certificate Number(s)* Securities* - -------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------- ------------------------------------------------------------------------- ------------------------------------------------------------------------- ------------------------------------------------------------------------- ------------------------------------------------------------------------- ------------------------------------------------------------------------- ------------------------------------------------------------------------- Total Amount Tendered - --------------------------------------------------------------------------------------------------------
* Need not be completed by book-entry holders. ** Old Capital Securities may be tendered in whole or in part in denominations of $1,000 and integral multiples thereof. All Old Capital Securities held shall be deemed tendered unless a lesser number is specified in this column. (BOXES BELOW TO BE CHECKED BY ELIGIBLE INSTITUTIONS ONLY) [ ] CHECK HERE IF TENDERED OLD CAPITAL SECURITIES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH DTC AND COMPLETE THE FOLLOWING: Name of Tendering Institution ________________________________________________________________________ DTC Account Number______________________________________________________ Transaction Code Number_________________________________________________ [ ] CHECK HERE AND ENCLOSE A PHOTOCOPY OF THE NOTICE OF GUARANTEED DELIVERY IF TENDERED OLD CAPITAL SECURITIES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND COMPLETE THE FOLLOWING: Name of Registered Holder(s)____________________________________________ Window Ticket Number (if any)___________________________________________ Date of Execution of Notice of Guaranteed Delivery______________________ Name of Institution which Guaranteed Delivery___________________________ If Guaranteed Delivery is to be made by Book-Entry Transfer: Name of Tendering Institution _______________________________________ DTC Account Number __________________________________________________ 2 Transaction Code Number _____________________________________________ [ ] CHECK HERE IF TENDERED BY BOOK-ENTRY TRANSFER AND NON-EXCHANGED OLD CAPITAL SECURITIES ARE TO BE RETURNED BY CREDITING THE DTC ACCOUNT NUMBER SET FORTH ABOVE. [ ] CHECK HERE IF YOU ARE A BROKER-DEALER WHO ACQUIRED THE OLD CAPITAL SECURITIES FOR ITS OWN ACCOUNT AS A RESULT OF MARKET MAKING OR OTHER TRADING ACTIVITIES (A "PARTICIPATING BROKER-DEALER") AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO. Name: __________________________________________________________________ Address:________________________________________________________________ ________________________________________________________________ 3 Ladies and Gentlemen: The undersigned hereby tenders to DPL Capital Trust II, a statutory business trust formed under the laws of the State of Delaware (the "Trust") and DPL Inc., an Ohio corporation (the "Company"), the aggregate liquidation amount of the Trust's 8 1/8% Capital Securities (the "Old Capital Securities") specified above in exchange for a like aggregate principal amount of the Trust's 8 1/8% Capital Securities (the "New Capital Securities"), upon the terms and subject to the conditions set forth in the Prospectus dated _______ ___, 200_ (as the same may be amended or supplemented from time to time, the "Prospectus"), receipt of which is acknowledged, and in this Letter of Transmittal (which, together with the Prospectus, constitute the "Exchange Offer"). The Exchange Offer has been registered under the Securities Act of 1933, as amended (the "Securities Act"). Subject to and effective upon the acceptance for exchange of all or any portion of the Old Capital Securities tendered herewith in accordance with the terms and conditions of the Exchange Offer (including, if the Exchange Offer is extended or amended, the terms and conditions of any such extension or amendment), the undersigned hereby sells, assigns and transfers to or upon the order of the Trust all right, title and interest in and to such Old Capital Securities as are being tendered herewith. The undersigned hereby irrevocably constitutes and appoints the Exchange Agent as its agent and attorney-in-fact (with full knowledge that the Exchange Agent is also acting as agent of the Trust and the Company in connection with the Exchange Offer) with respect to the tendered Old Capital Securities, with full power of substitution (such power of attorney being deemed to be an irrevocable power coupled with an interest), subject only to the right of withdrawal described in the Prospectus, to (i) deliver certificates for Old Capital Securities to the Trust together with all accompanying evidences of transfer and authenticity to, or upon the order of, the Trust, upon receipt by the Exchange Agent, as the undersigned's agent, of the New Capital Securities to be issued in exchange for such Old Capital Securities, (ii) present certificates for such Old Capital Securities for transfer, and to transfer the Old Capital Securities on the books of the Trust, and (iii) receive for the account of the Trust all benefits and otherwise exercise all rights of beneficial ownership of such Old Capital Securities, all in accordance with the terms and conditions of the Exchange Offer. THE UNDERSIGNED HEREBY REPRESENTS AND WARRANTS THAT THE UNDERSIGNED HAS FULL POWER AND AUTHORITY TO TENDER, EXCHANGE, SELL, ASSIGN AND TRANSFER THE OLD CAPITAL SECURITIES TENDERED HEREBY AND THAT, WHEN THE SAME ARE ACCEPTED FOR EXCHANGE, THE TRUST WILL ACQUIRE GOOD, MARKETABLE AND UNENCUMBERED TITLE THERETO, FREE AND CLEAR OF ALL LIENS, RESTRICTIONS, CHARGES AND ENCUMBRANCES, AND THAT THE OLD CAPITAL SECURITIES TENDERED HEREBY ARE NOT SUBJECT TO ANY ADVERSE CLAIMS OR PROXIES. THE UNDERSIGNED WILL, UPON REQUEST, EXECUTE AND DELIVER ANY ADDITIONAL DOCUMENTS DEEMED BY THE COMPANY OR THE EXCHANGE AGENT TO BE NECESSARY OR DESIRABLE TO COMPLETE THE EXCHANGE, ASSIGNMENT AND TRANSFER OF THE OLD CAPITAL SECURITIES TENDERED HEREBY, AND THE UNDERSIGNED WILL COMPLY WITH ITS OBLIGATIONS UNDER THE REGISTRATION RIGHTS AGREEMENT. THE UNDERSIGNED HAS READ AND AGREES TO ALL OF THE TERMS OF THE EXCHANGE OFFER. The name(s) and address(es) of the registered holder(s) of the Old Capital Securities tendered hereby should be printed above, if they are not already set forth above, as they appear on the certificates representing such Old Capital Securities. The certificate number(s) and the Old Capital Securities that the undersigned wishes to tender should be indicated in the appropriate boxes above. If any tendered Old Capital Securities are not exchanged pursuant to the Exchange Offer for any reason, or if certificates are submitted for more Old Capital Securities than are tendered or accepted for exchange, certificates for such unaccepted or nonexchanged Old Capital Securities will be returned (or, in the case of Old Capital Securities tendered by book-entry transfer, such Old Capital Securities will be credited to an account maintained at DTC), without expense to the tendering holder, promptly following the expiration or termination of the Exchange Offer. 4 The undersigned understands that tenders of Old Capital Securities pursuant to any one of the procedures described in "The Exchange Offer--Procedures for Tendering Old Capital Securities" in the Prospectus and in the instructions hereto will, upon the Trust and or Company's acceptance for exchange of such tendered Old Capital Securities, constitute a binding agreement between the undersigned, the Trust and the Company upon the terms and subject to the conditions of the Exchange Offer. In all cases in which a Participant elects to accept the Exchange Offer by transmitting an express acknowledgment in accordance with the established ATOP procedures, such Participant shall be bound by all of the terms and conditions of this Letter of Transmittal. The undersigned recognizes that, under certain circumstances set forth in the Prospectus, the Company may not be required to accept for exchange any of the Old Capital Securities tendered hereby. Unless otherwise indicated herein in the box entitled "Special Issuance Instructions" below, the undersigned hereby directs that the New Capital Securities be issued in the name(s) of the undersigned or, in the case of a book-entry transfer of Old Capital Securities, that such New Capital Securities be credited to the account indicated above maintained at DTC. If applicable, substitute certificates representing Old Capital Securities not exchanged or not accepted for exchange will be issued to the undersigned or, in the case of a book-entry transfer of Old Capital Securities, will be credited to the account indicated above maintained at DTC. Similarly, unless otherwise indicated under "Special Delivery Instructions," please deliver New Capital Securities to the undersigned at the address shown below the undersigned's signature. By tendering Old Capital Securities and executing, or otherwise becoming bound by, this Letter of Transmittal, the undersigned hereby represents and agrees that (i) the undersigned is not an "affiliate" of the Trust or the Company (as defined in Rule 144A under the Securities Act)., (ii) any New Capital Securities to be received by the undersigned are being acquired in the ordinary course of its business, and (iii) the undersigned has no arrangement or understanding with any person to participate in a "distribution" (within the meaning of the Securities Act) of such New Capital Securities. By tendering Old Capital Securities pursuant to the Exchange Offer and executing, or otherwise becoming bound by, this Letter of Transmittal, a holder of Old Capital Securities which is a broker-dealer represents and agrees, consistent with certain interpretive letters issued by the staff of the Division of Corporation Finance of the Securities and Exchange Commission to third parties, that (a) such Old Capital Securities held by the broker-dealer are held only as a nominee, or (b) such Old Capital Securities were acquired by such broker-dealer for its own account as a result of market-making activities or other trading activities and it will deliver the Prospectus (as amended or supplemented from time to time) meeting the requirements of the Securities Act in connection with any resale of such New Capital Securities (provided that, by so acknowledging and by delivering a Prospectus, such broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act). The Trust and the Company has agreed that, subject to the provisions of the Registration Rights Agreement, the Prospectus, as it may be amended or supplemented from time to time, may be used by a participating broker-dealer (as defined below) in connection with resales of New Capital Securities received in exchange for Old Capital Securities, where such Old Capital Securities were acquired by such participating broker-dealer for its own account as a result of market-making activities or other trading activities, for a period ending 90 days after the expiration date (subject to extension under certain limited circumstances) or, if earlier, when all such New Capital Securities have been disposed of by such participating broker-dealer. In that regard, each broker dealer who acquired Old Capital Securities for its own account as a result of market-making or other trading activities (a "participating broker-dealer"), by tendering such Old Capital Securities and executing, or otherwise becoming bound by, this Letter of Transmittal, agrees that, upon receipt of notice from the Trust or the Company of the occurrence of any event or the discovery of any fact which makes any statement contained in the Prospectus untrue in any material respect or which causes the Prospectus to omit to state a material fact necessary in order to make the statements contained therein, in light of the circumstances under which they were made, not misleading or of the occurrence of certain other events specified in the Registration Rights Agreement, such participating broker-dealer will suspend the sale of New Capital Securities pursuant to the Prospectus until the Company has amended or supplemented the Prospectus to correct such misstatement or omission and has furnished copies of 5 the amended or supplemented Prospectus to the participating broker-dealer or the Trust or the Company have given notice that the sale of the New Capital Securities may be resumed, as the case may be. All authority herein conferred or agreed to be conferred in this Letter of Transmittal shall survive the death or incapacity of the undersigned and any obligation of the undersigned hereunder shall be binding upon the heirs, executors, administrators, personal representatives, trustees in bankruptcy, legal representatives successors and assigns of the undersigned. Except as stated in the Prospectus, this tender is irrevocable. 6 HOLDER(S) SIGN HERE (See Instructions 2, 5 and 6) (Note: Signature(s) Must be Guaranteed if Required by Instruction 2) Must be signed by registered holder(s) exactly as name(s) appear(s) on certificate(s) for the Old Capital Securities hereby tendered or on a security position listing, or by any person(s) authorized to become the registered holder(s) by endorsements and documents transmitted herewith. If signature is by an attorney-in-fact, executor, administrator, trustee, guardian, officer of a corporation or another acting in a fiduciary or representative capacity, please set forth the signer's full title. See Instruction 5. Name(s):________________________________________________________________________ (Signature(s) of Holder(s) Date:_____________________________________________________________________, 2001 Name(s):________________________________________________________________________ ________________________________________________________________________________ (Please Print) Capacity:_______________________________________________________________________ (Include Full Title) Address:________________________________________________________________________ ________________________________________________________________________________ (Include Zip Code) Area Code and Telephone Number:_________________________________________________ ________________________________________________________________________________ (Tax Identification or Social Security Number(s)) GUARANTEE OF SIGNATURE(S) (See Instructions 2 and 5) Authorized Signature:___________________________________________________________ Name:___________________________________________________________________________ (Please Print) Date:_____________________________________________________________________, 2001 Capacity or Title:______________________________________________________________ Name of Firm:___________________________________________________________________ Address:________________________________________________________________________ (Include Zip Code) Area Code and Telephone Number:_________________________________________________ 7 SPECIAL ISSUANCE INSTRUCTIONS (See Instructions 1, 5 and 6) To be completed ONLY if the New Capital Securities are to be issued in the name of someone other than the registered holder of the Old Capital Securities whose name(s) appear(s) above. Issue New Capital Securities to: Name:___________________________________________________________________________ (Please Print) Address:________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ (Include Zip Code) ________________________________________________________________________________ (Taxpayer Identification or Social Security Number) SPECIAL DELIVERY INSTRUCTIONS (See Instructions 1, 5 and 6) To be completed ONLY if New Capital Securities are to be sent to someone other than the registered holder of the Old Capital Securities whose name(s) appear(s) above, or to such registered holder(s) at an address other than that shown above. Mail New Capital Securities To: Name:___________________________________________________________________________ (Please Print) Address:________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ (Include Zip Code) ________________________________________________________________________________ (Taxpayer Identification or Social Security Number) INSTRUCTIONS Forming Part of the Terms and Conditions of the Exchange Offer 1. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES; GUARANTEED DELIVERY PROCEDURES. This Letter of Transmittal is to be completed if certificates are to be forwarded herewith or delivered by book-entry transfer as provided herein. If tenders are to be made pursuant to the procedures for tender by book-entry transfer set forth in "The Exchange Offer-Book-Entry Transfer" in the Prospectus and in accordance with ATOP established by DTC, a tendering holder will become bound by the terms and conditions hereof in accordance with the procedures established under ATOP. Certificates, or timely confirmation of a book-entry transfer of such Old Capital Securities into the Exchange Agent's account at DTC, as well as this Letter of Transmittal (or facsimile thereof), if required, properly completed and duly executed, with any 8 required signature guarantees, must be received by the Exchange Agent at one of its addresses set forth herein on or prior to the expiration date. Old Capital Securities may be tendered in whole or in part in the principal amount of $1,000 and integral multiples of $1,000. Holders who wish to tender their Old Capital Securities and (i) whose Old Capital Securities are not immediately available or (ii) who cannot deliver their Old Capital Securities and this Letter of Transmittal to the Exchange Agent on or prior to the expiration date of the Exchange Offer or (iii) who cannot complete the procedures for delivery by book-entry transfer on a timely basis, may tender their Old Capital Securities by properly completing and duly executing a Notice of Guaranteed Delivery pursuant to the guaranteed delivery procedures set forth in "The Exchange Offer--Guaranteed Delivery Procedures" in the Prospectus. Pursuant to such procedures: (i) such tender must be made by or through an Eligible Institution (as defined below); (ii) a properly completed and duly executed Letter of Transmittal (or facsimile) thereof and Notice of Guaranteed Delivery, substantially in the form made available by the Company, must be received by the Exchange Agent on or prior to the expiration date; and (iii) the certificates (or a book-entry confirmation (as defined in the Prospectus)) representing all tendered Old Capital Securities, in proper form for transfer, must be received by the Exchange Agent within five New York Stock Exchange trading days after the date of execution of such Notice of Guaranteed Delivery, all as provided in "The Exchange Offer--Guaranteed Delivery Procedures" in the Prospectus. The Notice of Guaranteed Delivery may be delivered by hand or transmitted by telegram, telex, facsimile or mail to the Exchange Agent, and must include a guarantee by an Eligible Institution in the form set forth in such Notice. For Old Capital Securities to be properly tendered pursuant to the guaranteed delivery procedure, the Exchange Agent must receive a Notice of Guaranteed Delivery on or prior to the expiration date of the Exchange Offer. As used herein and in the Prospectus, "Eligible Institution" means a firm which is a member of a registered national securities exchange or a member of the National Association of Securities Dealers, Inc. or a commercial bank or trust company having an office or correspondent in the United States. THE METHOD OF DELIVERY OF OLD CAPITAL SECURITIES, THIS LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS IS AT THE ELECTION AND RISK OF THE TENDERING HOLDER. IF SUCH DELIVERY IS BY MAIL, IT IS RECOMMENDED THAT REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, BE USED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE TIMELY DELIVERY. NO LETTERS OF TRANSMITTAL OR OLD CAPITAL SECURITIES SHOULD BE SENT TO THE COMPANY. The Company will not accept any alternative, conditional or contingent tenders. Each tendering holder, by execution of a Letter of Transmittal (or facsimile thereof), or any Agent's Message in lieu thereof, waives any right to receive any notice of the acceptance of such tender. 2. GUARANTEE OF SIGNATURES. No signature guarantee on this Letter of Transmittal is required if: (i) this Letter of Transmittal is signed by the registered holder (which term, for purposes of this document, shall include any participant in DTC whose name appears on a security position listing as the owner of the Old Capital Securities) of Old Capital Securities tendered herewith, unless such holder(s) has completed either the box entitled "Special Issuance Instructions" or the box entitled "Special Delivery Instructions" above, or (ii) such Old Capital Securities are tendered for the account of a firm that is an Eligible Institution. In all other cases, an Eligible Institution must guarantee the signature(s) on this Letter of Transmittal. See Instruction 5. 3. INADEQUATE SPACE. If the space provided in the box captioned "Description of Old Capital Securities Tendered" is inadequate, the certificate number(s) and/or the principal amount of Old Capital Securities and any other required information should be listed on a separate signed schedule which is attached to this Letter of Transmittal. 4. PARTIAL TENDERS AND WITHDRAWAL RIGHTS. Tenders of Old Capital Securities will be accepted only in the principal amount of $1,000 and integral multiples thereof. If less than all the Old Capital 9 Securities evidenced by any certificate submitted are to be tendered, fill in the principal amount of Old Capital Securities which are to be tendered in the box entitled "Principal Amount of Old Capital Securities Tendered (if less than all)." In such case, new certificate(s) for the remainder of the Old Capital Securities that were evidenced by your old certificate(s) will only be sent to the holder of the Old Note, promptly after the expiration date of the Exchange Offer. All Old Capital Securities represented by certificates delivered to the Exchange Agent will be deemed to have been tendered unless otherwise indicated. Except as otherwise provided herein, tenders of Old Capital Securities may be withdrawn at any time on or prior to the expiration date. In order for a withdrawal to be effective on or prior to that time, a written notice of withdrawal must be timely received by the Exchange Agent at one of its addresses set forth above or in the Prospectus on or prior to the expiration date of the Exchange Offer. Any such notice of withdrawal must specify the name of the person who tendered the Old Capital Securities to be withdrawn, identify the Old Capital Securities to be withdrawn (including the principal amount of such Old Capital Securities) and (where certificates for Old Capital Securities have been transmitted) specify the name in which such Old Capital Securities are registered, if different from that of the withdrawing holder. If certificates for the Old Capital Securities have been delivered or otherwise identified to the Exchange Agent, then prior to the release of such certificates, the withdrawing holder must submit the serial numbers of the particular certificates for the Old Capital Securities to be withdrawn and a signed notice of withdrawal with signatures guaranteed by an Eligible Institution, unless such holder is an Eligible Institution. If Old Capital Securities have been tendered pursuant to the procedures for book-entry transfer set forth in the Prospectus under "The Exchange Offer--Book-Entry Transfer," any notice of withdrawal must specify the name and number of the account at DTC to be credited with the withdrawal of Old Capital Securities and otherwise comply with the procedures of such facility. Old Capital Securities properly withdrawn will not be deemed validly tendered for purposes of the Exchange Offer, but may be retendered at any time on or prior to the expiration date by following one of the procedures described in the Prospectus under "The Exchange Offer--Procedures for Tendering Old Capital Securities". All questions as to the validity, form and eligibility (including time of receipt) of such withdrawal notices will be determined by the Company, whose determination shall be final and binding on all parties. Any Old Capital Securities which have been tendered for exchange but which are not exchanged for any reason will be returned to the holder thereof without cost to such holder (or, in the case of Old Capital Securities tendered by book-entry transfer into the Exchange Agent's account at DTC pursuant to the book-entry procedures described in the Prospectus under "The Exchange Offer--Book-Entry Transfer" such Old Capital Securities will be credited to an account maintained with DTC for the Old Capital Securities) as soon as practicable after withdrawal, rejection of tender or termination of the Exchange Offer. 5. SIGNATURES ON LETTER OF TRANSMITTAL, ASSIGNMENTS AND ENDORSEMENTS. If this Letter of Transmittal is signed by the registered holder(s) of the Old Capital Securities tendered hereby, the signature(s) must correspond exactly with the name(s) as written on the face of the certificate(s) without alteration, enlargement or any change whatsoever. If any of the Old Capital Securities tendered hereby are owned of record by two or more joint owners, all such owners must sign this Letter of Transmittal. If any tendered Old Capital Securities are registered in different names on several certificates, it will be necessary to complete, sign and submit as many separate Letters of Transmittal (or facsimiles thereof) as there are different registrations of certificates. If this Letter of Transmittal or any certificates or powers of attorney are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing and, unless waived by the Company, proper evidence satisfactory to the Company of such persons' authority to so act must be submitted. When this Letter of Transmittal is signed by the registered holder(s) of the Old Capital Securities listed and transmitted hereby, no endorsement(s) of certificate(s) or written instrument or instruments of transfer or exchange are required unless New Capital Securities are to be issued in the name of a person other than the registered 10 holder(s). Signature(s) on such certificate(s) or written instrument or instruments of transfer or exchange must be guaranteed by an Eligible Institution. If this Letter of Transmittal is signed by a person other than the registered holder(s) of the Old Capital Securities listed, the certificates must be endorsed or accompanied by a written instrument or instruments of transfer or exchange, in satisfactory form as determined by the Company in its sole discretion and executed by the registered holder(s), in either case signed exactly as the name or names of the registered holder(s) appear(s) on the certificates. Signatures on such certificates or written instrument or instruments of transfer or exchange must be guaranteed by an Eligible Institution. 6. SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS. If New Capital Securities are to be issued in the name of a person other than the signer of this Letter of Transmittal, or if New Capital Securities are to be sent to someone other than the signer of this Letter of Transmittal or to an address other than that shown above, the appropriate boxes on this Letter of Transmittal should be completed. Certificates for Old Capital Securities not exchanged will be returned by mail or, if tendered by book-entry transfer, by crediting the account indicated above maintained at DTC. See Instruction 4. 7. IRREGULARITIES. The Company will determine, in its sole discretion, all questions as to the form, validity, eligibility (including time of receipt) and acceptance for exchange of any tender of Old Capital Securities, which determination shall be final and binding. The Trust or the Company reserve the absolute right to reject any and all tenders of any particular Old Capital Securities not properly tendered or to not accept any particular Old Capital Securities which acceptance might, in the judgment of the Company or its counsel, be unlawful. The Company also reserves the absolute right, in its sole discretion, to waive any defects or irregularities or conditions of the Exchange Offer as to any particular Old Capital Securities either before or after the expiration date (including the right to waive the ineligibility of any holder who seeks to tender Old Capital Securities in the Exchange Offer). The interpretation of the terms and conditions of the Exchange Offer as to any particular Old Capital Securities either before or after the expiration date (including the Letter of Transmittal and the instructions thereto) by the Company shall be final and binding on all parties. Unless waived, any defects or irregularities in connection with the tender of Old Capital Securities for exchange must be cured within such reasonable period of time as the Company shall determine. Neither the Company, the Exchange Agent nor any other person shall be under any duty to give notification of any defect or irregularity with respect to any tender of Old Capital Securities for exchange, nor shall any of them incur any liability for failure to give such notification. 8. QUESTIONS, REQUESTS FOR ASSISTANCE AND ADDITIONAL COPIES. Questions regarding the procedure for tendering may be directed to the Exchange Agent at its address and telephone number set forth on the front of this Letter of Transmittal. Additional copies of the Prospectus, the Notice of Guaranteed Delivery and the Letter of Transmittal may be obtained from the Exchange Agent or from your broker, dealer, commercial bank, trust company or other nominee. All other questions should be directed to ____________ [a Company representative]. 9. LOST, DESTROYED OR STOLEN CERTIFICATES. If any certificate(s) representing Old Capital Securities have been lost, destroyed or stolen, the holder should promptly notify the Exchange Agent. The holder will then be instructed as to the steps that must be taken in order to replace the certificate(s). This Letter of Transmittal and related documents cannot be processed until the procedures for replacing lost, destroyed or stolen certificate(s) have been followed. 10. SECURITY TRANSFER TAXES. Holders who tender their Old Capital Securities for exchange will be obligated to pay transfer taxes, if any, in connection therewith. 11. IMPORTANT TAX INFORMATION. Under United States federal income tax law, a holder whose tendered Old Capital Securities are accepted for exchange is required to provide the Exchange Agent with such holder's correct taxpayer identification number ("TIN") on Substitute Form W-9. If the Exchange Agent is not provided with the correct TIN, the Internal Revenue Service (the "IRS") may subject the holder or other payee to a $50 penalty. In addition, payments to such holders or other payees with respect to Old Capital Securities pursuant to the Exchange Offer may be subject to 30.5% backup withholding. 11 The box in Part 2 of the Substitute Form W-9 may be checked if the tendering holder has not been issued a TIN and has applied for a TIN or intends to apply for a TIN in the near future. If the box in Part 2 is checked, the holder or other payee must also complete a CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER in order to avoid backup withholding. Notwithstanding that the box in Part 2 is checked and the Certificate of Awaiting Taxpayer Identification Number is completed, the Exchange Agent will withhold 30.5% of all payments made prior to the time a properly certified TIN is provided to the Exchange Agent. The Exchange Agent will retain such amounts withheld during the 60-day period following the date of the Substitute Form W-9. If the holder furnishes the Exchange Agent with its TIN within 60 days after the date of the Substitute Form W-9, the amounts retained during the 60-day period will be remitted to the holder and no further amounts shall be retained or withheld from payments made to the holder thereafter. If, however, the holder has not provided the Exchange Agent with its TIN within such 60-day period, amounts withheld will be remitted to the IRS as backup withholding. In addition, 30.5% of all payments made thereafter will be withheld and remitted to the IRS until a correct TIN is provided. The holder is required to give the Exchange Agent the TIN (e.g., social security number or employer identification number) of the registered owner of the Old Capital Securities or of the last transferee appearing on the transfers attached to, or endorsed on, the Original Capital Securities. Certain holders (including, among others, corporations, financial institutions and certain foreign persons) may not be subject to these backup withholding and reporting requirements. Such holders should nevertheless complete a Substitute Form W-9, and write "exempt" on the face thereof, to avoid possible erroneous backup withholding. A foreign person may qualify as an exempt recipient by submitting a properly completed IRS Form W-8, signed under penalties of perjury, attesting to that holder's exempt status. Backup withholding is not an additional United States federal income tax. Rather, the federal income tax liability of a person subject to backup withholding will be reduced by the amount of tax withheld. If withholding results in a overpayment of taxes, a refund may be obtained. IMPORTANT: THIS LETTER OF TRANSMITTAL (OR FACSIMILE THEREOF), OR AN AGENT'S MESSAGE IN LIEU THEREOF, AND ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE EXCHANGE AGENT ON OR PRIOR TO THE EXPIRATION DATE OF THE EXCHANGE OFFER. 12 EX-99 22 e431480v1.txt EXHIBIT 99(D) EXHIBIT 99(D) DPL CAPITAL TRUST II DPL INC. OFFER TO EXCHANGE 8 1/8% CAPITAL SECURITIES FOR ANY AND ALL OUTSTANDING 8 1/8% CAPITAL SECURITIES (CUSIP NO. 2330AAA8 AND U26057AA4) (ISIN NO. US23330AAA88 AND USU26057AA40) To Our Clients: Enclosed is a Prospectus, dated _________ ___, 2001, of DPL Capital Trust II, a statutory business trust formed under the laws of the State of Delaware (the "Trust") and DPL Inc., an Ohio corporation (the "Company"), and a related Letter of Transmittal (which together constitute the "Exchange Offer") relating to the offer by the Trust to exchange its 8 1/8% Capital Securities (the "Exchange Capital Securities"), pursuant to an offering registered under the Securities Act of 1933, as amended (the "Securities Act"), for a like principal amount of the Trust's issued and outstanding 8 1/8% Capital Securities (the "Old Capital Securities"), upon the terms and subject to the conditions set forth in the Exchange Offer. Please note that the Exchange Offer will expire at 5:00 p.m., Exchange York City time, on _______, __, 2001, unless extended. The Exchange Offer is not conditioned upon any minimum number of Old Capital Securities being tendered. We are the holder of record and/or participant in the book-entry transfer facility of Old Capital Securities held by us for your account. A tender of such Old Capital Securities can be made only by us as the record holder and/or participant in the book-entry transfer facility and pursuant to your instructions. The Letter of Transmittal is furnished to you for your information only and cannot be used by you to tender Old Capital Securities held by us for your account. We request instructions as to whether you wish to tender any or all of the Old Capital Securities held by us for your account pursuant to the terms and conditions of the Exchange Offer. We also request that you confirm that we may on your behalf make the representations contained in the Letter of Transmittal. Pursuant to the Letter of Transmittal, each holder of Old Capital Securities will represent to the Trust and the Company that (i) the holder is not an "affiliate" of the Trust or the Company, (ii) any Exchange Capital Securities to be received by the holder are being acquired in the ordinary course of its business, and (iii) the holder has no arrangement or understanding with any person to participate in a distribution (within the meaning of the Securities Act) of such Exchange Capital Securities. If the tendering holder is a broker-dealer that will receive Exchange Capital Securities for its own account in exchange for Old Capital Securities, we will represent on behalf of such broker-dealer that the Old Capital Securities to be exchanged for the Exchange Capital Securities were acquired by it as a result of market-making activities or other trading activities, and acknowledge on behalf of such broker-dealer that it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of such Exchange Capital Securities. By acknowledging that it will deliver and by delivering a prospectus meeting the requirements of the Securities Act in connection with any resale of such Exchange Capital Securities, such broker-dealer is not deemed to admit that it is an "underwriter" within the meaning of the Securities Act. Very truly yours, DPL INC. EX-99 23 e431476v1.txt EXHIBIT 99(E) EXHIBIT 99(E) DPL CAPITAL TRUST II DPL INC. OFFER TO EXCHANGE 8 1/8% CAPITAL SECURITIES FOR ANY AND ALL OUTSTANDING 8 1/8% CAPITAL SECURITIES (CUSIP NO. 2330AAA8 AND U26057AA4) (ISIN NO. US23330AAA88 AND USU26057AA40) To Registered Holders and The Depository Trust Company Participants: Enclosed are the materials listed below relating to the offer by DPL Capital Trust II, a statutory business trust formed under the laws of the State of Delaware (the "Trust") and DPL Inc., an Ohio corporation (the "Company"), to exchange its 8 1/8% Capital Securities (the "Exchange Capital Securities"), pursuant to an offering registered under the Securities Act of 1933, as amended (the "Securities Act"), for a like principal amount of the Trust's issued and outstanding 8 1/8% Capital Securities (the "Old Securities"), upon the terms and subject to the conditions set forth in the Trust and the Company's Prospectus, dated _______ ___, 2001, and the related Letter of Transmittal (which together constitute the "Exchange Offer"). Enclosed herewith are copies of the following documents: 1. Prospectus dated __________ ___, 2001; 2. Letter of Transmittal; 3. Notice of Guaranteed Delivery; 4. Instruction to Registered Holder and/or Book-Entry Transfer Participant from Owner; and 5. Letter which may be sent to your clients for whose account you hold Old Securities in your name or in the name of your nominee, to accompany the instruction form referred to above, for obtaining such client's instruction with regard to the Exchange Offer. We urge you to contact your clients promptly. Please note that the Exchange Offer will expire at 5:00 p.m., New York City time, on _________ ___, 2001 unless extended. The Exchange Offer is not conditioned upon any minimum number of Old Securities being tendered. Pursuant to the Letter of Transmittal, each holder of Old Securities will represent to the Trust and the Company that (i) the holder is not an "affiliate" of the Trust or the Company, (ii) any Exchange Capital Securities to be received by it are being acquired in the ordinary course of its business, and (iii) the holder has no arrangement or understanding with any person to participate in a distribution (within the meaning of the Securities Act) of such Exchange Capital Securities. If the tendering holder is a broker-dealer that will receive Exchange Capital Securities for its own account in exchange for Old Securities, you will represent on behalf of such broker-dealer that the Old Securities to be exchanged for the Exchange Capital Securities were acquired by it as a result of market-making activities or other trading activities, and acknowledge on behalf of such broker-dealer that it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of such Exchange Capital Securities. By acknowledging that it will deliver and by delivering a prospectus meeting the requirements of the Securities Act in connection with any resale of such Exchange Capital Securities, such broker-dealer is not deemed to admit that it is an "underwriter" within the meaning of the Securities Act. The enclosed Instruction to Registered Holder and/or Book-Entry Transfer Facility Participant from Owner contains an authorization by the beneficial owners of the Old Securities for you to make the foregoing representations. Neither the Trust nor the Company will pay any fee or commission to any broker or dealer or to any other persons (other than the Exchange Agent) in connection with the solicitation of tenders of Old Securities pursuant to the Exchange Offer. The Company will pay or cause to be paid any transfer taxes payable on the transfer of Old Securities to it, except as otherwise provided in Instruction 10 of the enclosed Letter of Transmittal. Additional copies of the enclosed material may be obtained from the undersigned. Very truly yours, BANK ONE TRUST COMPANY, NATIONAL ASSOCIATION NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL MAKE YOU THE AGENT OF DPL INC., DPL CAPITAL TRUST II OR BANK ONE TRUST COMPANY, NATIONAL ASSOCIATION, OR AUTHORIZE YOU TO USE ANY DOCUMENT OR MAKE ANY STATEMENT ON THEIR BEHALF IN CONNECTION WITH THE EXCHANGE OFFER OTHER THAN THE DOCUMENTS ENCLOSED HEREWITH AND THE STATEMENTS CONTAINED THEREIN. 2 EX-99 24 e431449v1.txt EXHIBIT 99(F) EXHIBIT 99(F) INSTRUCTION TO REGISTERED HOLDER AND/OR BOOK-ENTRY TRANSFER FACILITY PARTICIPANT FROM OWNER OF DPL CAPITAL TRUST II AND DPL INC. 8 1/8% CAPITAL SECURITIES (THE "OLD SECURITIES") (CUSIP NO. 23330AAA8 AND U26057AA4) (ISIN NO. US23330AAA8 AND USU26057AA40) To Registered Holder and/or Participant of the Book-Entry Transfer Facility: The undersigned hereby acknowledges receipt of the Prospectus dated _________ __, 2001 (the "Prospectus") of DPL Capital Trust II, a statutory business trust formed under the laws of the State of Delaware (the "Trust") and DPL Inc., an Ohio corporation (the "Company"), and the accompanying Letter of Transmittal (the "Letter of Transmittal"), that together constitute the Trust and the Company's offer (the "Exchange Offer"). Capitalized terms used but not defined herein have the meanings as ascribed to them in the Letter of Transmittal. This will instruct you, the registered holder and/or book-entry transfer facility participant, as to the action to be taken by you relating to the Exchange Offer with respect to the Old Securities held by you for the account of the undersigned. The aggregate face amount of the Old Securities held by you for the account of the undersigned is (fill in amount): $--------------- With respect to the Exchange Offer, the undersigned hereby instructs you (check appropriate box): [ ] To TENDER the following Old Securities held by you for the account of the undersigned (insert principal amount of Old Securities to be tendered, if any): $--------------- [ ] NOT to TENDER any Old Securities held by you for the account of the undersigned. If the undersigned instructs you to tender the Old Securities held by you for the account of the undersigned, it is understood that you are authorized to make, on behalf of the undersigned (and the undersigned, by its signature below, hereby makes to you), the representations and warranties contained in the Letter of Transmittal that are to be made with respect to the undersigned as a beneficial owner, including but not limited to the representations, that (i) the holder is not an "affiliate" of the Trust or the Company, (ii) any Exchange Securities to be received by the holder are being acquired in the ordinary course of its business, and (iii) the holder has no arrangement or understanding with any person to participate in a distribution (within the meaning of the Securities Act) of such Exchange Securities. If the undersigned is a broker-dealer that will receive Exchange Securities for its own account in exchange for Old Securities, it represents that such Old Securities were acquired as a result of market-making activities or other trading activities, and it acknowledges that it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of such Exchange Securities. By acknowledging that it will deliver and by delivering a prospectus meeting the requirements of the Securities Act in connection with any resale of such Exchange Securities, such broker-dealer is not deemed to admit that it is an "underwriter" within the meaning of the Securities Act. SIGN HERE Name of beneficial owner(s):___________________________________________________ Signature(s):__________________________________________________________________ Name(s) (please print):________________________________________________________ Address:_______________________________________________________________________ _______________________________________________________________________________ Telephone Number:______________________________________________________________ Taxpayer Identification or Social Security Number:_____________________________ Date:__________________________________________________________________________ 2 -----END PRIVACY-ENHANCED MESSAGE-----