Document:

EXHIBIT 4.1

 

 

SUPPLEMENTAL INDENTURE

dated as of March 7, 2014

among

AETNA INC.,

and

U.S. BANK NATIONAL ASSOCIATION,

as Trustee

 

 

2.200% Senior Notes due March 15, 2019

4.750% Senior Notes due March 15, 2044

 

 

 

 

 

 

  

  

  

 

TABLE OF CONTENTS

Page

	
ARTICLE 1

	
Definitions

	
Section 1.01.  Definitions.

	
2

	
Section 1.02.  Section References

	
6

	 	 
	
ARTICLE 2

	
The Notes

	 
	
Section 2.01.  Issue of Notes

	
7

	
Section 2.02.  Stated Maturity

	
7

	
Section 2.03.  Notes Issuable as Global Securities

	
7

	
Section 2.04.  Interest and Payment

	
8

	
Section 2.05.  Payment of Interest

	
8

	
Section 2.06.  Optional Redemption

	
8

	
Section 2.07.  Change of Control Offer to Purchase

	
9

	
Section 2.08.  Applicability of Certain Provisions of the Base Indenture in Respect of the Notes

	
11

	
Section 2.09.  Registrar and Paying Agent

	
11

	
Section 2.10.  No Sinking Fund

	
11

	
Section 2.11.  Minimum Denominations

	
11

	 	 
	
ARTICLE 3

	
Miscellaneous

	 
	
Section 3.01.  Relation to Indenture

	
11

	
Section 3.02.  Continued Effect

	
11

	
Section 3.03.  Provisions Binding on Company’s Successors

	
12

	
Section 3.04.  Certain Trustee Matters

	
12

	
Section 3.05.  Governing Law

	
12

	
Section 3.06.  Counterparts

	
12

Exhibit A – Form of Security

  

i

  

 

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of March 7, 2014, between AETNA INC., a corporation duly organized and validly existing under the laws of the Commonwealth of Pennsylvania (the “Company”), having its principal office at 151 Farmington Avenue, Hartford, Connecticut 06156 and U.S. BANK NATIONAL ASSOCIATION, as successor-in-interest to State Street Bank and Trust Company, as trustee (the “Trustee”).

 

RECITALS

 

WHEREAS, the Company and the Trustee entered into a Senior Indenture dated as of March 2, 2001 (the “Base Indenture”, and as supplemented by this Supplemental Indenture, the “Indenture”) providing for the issuance from time to time of the Company’s debentures, notes or other evidences of indebtedness (the “Securities”), to be issued in one more series as in the Base Indenture provided;

 

WHEREAS, Sections 201 and 301 of the Base Indenture provide that the Company and the Trustee may establish the terms of a new series of Securities in an indenture supplemental to the Base Indenture;

 

WHEREAS, Section 901 of the Base Indenture provides that the Company and the Trustee may enter into an indenture supplemental to the Base Indenture, without the consent of any Holders, to eliminate any of the provisions of the Base Indenture in respect of a new series of Securities so established pursuant to Section 301 of the Base Indenture;

 

WHEREAS, pursuant to resolutions adopted by the Board of Directors of the Company on January 31, 2014 and the Delegation of Authority of Mark T. Bertolini, Chairman, Chief Executive Officer and President of the Company, dated February  25, 2014 (collectively, the “Company Resolutions”), the Company has approved to be established two new series of Securities, designated as its 2.200% Senior Notes due March 15, 2019 (the “2019 Notes”) and its 4.750% Senior Notes due March 15, 2044 (the “2044 Notes” and together with the 2019 Notes, the “Notes”) as in this Supplemental Indenture provided; and

 

WHEREAS, all requirements necessary to make this Supplemental Indenture a valid, binding and enforceable instrument in accordance with its terms and to make the Notes, when executed, authenticated and delivered by the Company, the valid, binding and enforceable obligations of the Company have been done and performed.

 

NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained and intending to be legally bound, the parties to this Supplemental Indenture hereby agree as follows:

 

  

1

  

 

ARTICLE 1

Definitions

 

Section 1.01.  Definitions.

 

(a)      Capitalized terms used herein and not otherwise defined herein have the respective meanings assigned to them in the Base Indenture.

 

(b)      The following terms shall have the meanings assigned to them in this Section 1.01(b):

 

“2019 Notes” has the meaning stated in the fourth recital of this Supplemental Indenture.

 

“2044 Notes” has the meaning stated in the fourth recital of this Supplemental Indenture.

 

 “Base Indenture” has the meaning stated in the first recital of this Supplemental Indenture.

 

“Below Investment Grade Rating Event” means the Notes of a series are rated below an Investment Grade Rating by each of the Rating Agencies on any date from the earlier of (1) the occurrence of a Change of Control and (2) public notice of the Company’s intention to effect a Change of Control, in each case until the end of the 60-day period following the earlier of (1) the occurrence of a Change of Control and (2) public notice of the Company’s intention to effect a Change of Control; provided, however, that if (i) during such 60-day period one or more Rating Agencies has publicly announced that it is considering the possible downgrade of the Notes of such series, and (ii) a downgrade by each of the Rating Agencies that has made such an announcement would result in a Below Investment Grade Rating Event, then such 60-day period shall be extended for such time as the rating of the Notes of such series by any such Rating Agency remains under publicly announced consideration for possible downgrade to a rating below an Investment Grade Rating and a downgrade by such Rating Agency to a rating below an Investment Grade Rating could cause a Below Investment Grade Rating Event. Notwithstanding the foregoing, a rating event otherwise arising by virtue of a particular reduction in rating will not be deemed to have occurred in respect of a particular Change of Control (and thus will not be deemed a Below Investment Grade Rating Event for purposes of the definition of Change of Control Triggering Event) if the Rating Agencies making the reduction in rating to which this definition would otherwise apply do not announce or publicly confirm or inform the Trustee in writing at the Company’s or the Trustee’s request that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the 

 

  

2

  

 

applicable Change of Control (whether or not the applicable Change of Control has occurred at the time of the rating event).

 

“Change of Control” means the occurrence of any of the following: (1) direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of the Company and its subsidiaries taken as a whole to any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) other than to the Company or one of its subsidiaries; (2) the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) other than the Company or one of its subsidiaries becomes the beneficial owner, directly or indirectly, of more than 50% of the then outstanding number of shares of the Company’s voting stock; or (3) the first day on which a majority of the members of the Company’s Board of Directors are not Continuing Directors; provided, however, that a transaction will not be deemed to involve a Change of Control if (A) the Company becomes a wholly owned subsidiary of a holding company and (B)(x) the holders of the voting stock of such holding company immediately following that transaction are substantially the same as the holders of the Company’s voting stock immediately prior to that transaction or (y) immediately following that transaction no “person” (as that term is used in Section 13(d)(3) of the Exchange Act) is the beneficial owner, directly or indirectly, of more than 50% of the voting stock of such holding company. For purposes of this definition, “voting stock” means capital stock of any class or kind the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of directors (or persons performing similar functions) of the Company, even if the right to vote has been suspended by the happening of such a contingency.

 

“Change of Control Offer” has the meaning stated in Section 2.07(a) of this Supplemental Indenture.

 

“Change of Control Payment” has the meaning stated in Section 2.07(a) of this Supplemental Indenture.

 

“Change of Control Payment Date” has the meaning stated in Section 2.07(a) of this Supplemental Indenture.

 

“Change of Control Triggering Event” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event.

 

“Company” means the Person named as the “Company” in the first paragraph of this Supplemental Indenture until a successor Person shall have become such pursuant to the applicable provisions of the Indenture, and thereafter “Company” shall mean such successor Person.

 

  

3

  

 

“Company Resolutions” has the meaning stated in the fourth recital of this Supplemental Indenture.

 

“Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having an actual or interpolated maturity comparable to the remaining term of the Notes of the series to be redeemed, calculated as if the Stated Maturity of the Notes were February 15, 2019 (in the case of the 2019 Notes) or September 15, 2043 (in the case of the 2044 Notes) (in either case, “Remaining Life”) that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the Remaining Life of the Notes of such series to be redeemed.

 

“Comparable Treasury Price” means, with respect to any Redemption Date for any Notes of a series, the average of all Reference Treasury Dealer Quotations obtained.

 

“Continuing Directors” means, as of any date of determination, any member of the Board of Directors of the Company who (1) was a member of the Board of Directors of the Company on the date of the issuance of the Notes; or (2) was nominated for election or elected to the Board of Directors of the Company with the approval of a majority of the Continuing Directors who were members of such Board of Directors of the Company at the time of such nomination or election (either by specific vote or by approval of the Company’s proxy statement in which such member was named as a nominee for election as a director).

 

“DTC” means The Depository Trust Company.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and any successor statute thereto.

 

“Fitch” means Fitch Ratings Inc.

 

“Indenture” has the meaning stated in the first recital of this Supplemental Indenture.

 

“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Trustee after consultation with the Company.

 

“Investment Grade Rating” means a rating by Moody’s equal to or higher than Baa3 (or the equivalent under any successor rating category of Moody’s), a rating by S&P equal to or higher than BBB- (or the equivalent under any successor rating category of S&P), a rating by Fitch equal to or higher than BBB- (or the equivalent under any successor rating category of Fitch), and the equivalent investment grade credit rating from any replacement rating agency or

 

  

4

  

 

rating agencies selected by the Company under the circumstances permitting the Company to select a replacement agency and in the manner for selecting a replacement agency, in each case as set forth in the definition of “Rating Agencies”.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Notes” has the meaning stated in the fourth recital of this Supplemental Indenture.

 

“Primary Treasury Dealer” has the meaning stated in the definition of “Reference Treasury Dealer” in this Section 1.01(b).

 

“Rating Agencies” means (1) Moody’s, S&P and Fitch; and (2) if any or all of Moody’s, S&P or Fitch ceases to rate the Notes of a series or fails to make a rating of the Notes of such series publicly available for reasons outside of the Company’s control, a “nationally recognized statistical rating organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act, that the Company selects (pursuant to a resolution of the Company’s Board of Directors) as a replacement agency for any of Moody’s, S&P or Fitch, or all of them, as the case may be, with respect to such series of Notes.

 

“Reference Treasury Dealer” means each of Credit Suisse Securities (USA) LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and RBS Securities Inc.  If any Reference Treasury Dealer ceases to be a primary U.S. government securities dealer in the United States (a “Primary Treasury Dealer”), the Company shall substitute another Primary Treasury Dealer for that dealer.

 

“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 that Reference Treasury Dealer at 5:00 p.m. on the third Business Day preceding the Redemption Date.

 

“Remaining Life” has the meaning stated in the definition of “Comparable Treasury Issue” in this Section 1.01(b)

 

“Securities” has the meaning stated in the first recital of this Supplemental Indenture and more particularly means any Securities authenticated and delivered under the Indenture, including, without limitation, the Notes.

 

“S&P” means Standard & Poor’s Ratings Services, a division of McGraw-Hill Financial, Inc.

 

  

5

  

 

“Supplemental Indenture” has the meaning stated in the first paragraph of this instrument.

 

“Treasury Rate” means, with respect to any Redemption Date for any portion of the Notes of a series,

 

	
  

	
·

	
the yield, under the heading which represents the average for the immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication which is published weekly by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after the Remaining Life for the Notes of such series, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue will be determined and the Treasury Rate shall be interpolated or extrapolated from those yields on a straight line basis, rounding to the nearest month), or

 

	
  

	
·

	
if the release referred to in the previous bullet (or any successor release) is not published during the week preceding the calculation date or does not contain the yields referred to above, 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 that Redemption Date.

 

The Treasury Rate will be calculated on the third Business Day preceding the Redemption Date.

 

“Trustee” means the Person named as the “Trustee” in respect of the Notes in the first paragraph of this Supplemental Indenture until a successor Trustee in respect of the Notes shall have become such pursuant to the applicable provisions of the Indenture, and thereafter “Trustee” shall mean or include such Person who is then a Trustee in respect of the Notes.

 

Section 1.02.  Section References.  Each reference to a particular section set forth in this Supplemental Indenture shall, unless the context otherwise requires, refer to this Supplemental Indenture.  Each reference to a particular section of the Base Indenture shall refer to that particular section of the Base Indenture.

 

  

6

  

 

ARTICLE 2

The Notes

 

Section 2.01.  Issue of Notes.  The Notes shall be issued as two series of Securities under the Base Indenture as supplemented by this Supplemental Indenture, which such series shall be known and designated as the “2.200% Senior Notes due March 15, 2019” and the “4.750% Senior Notes due March 15, 2044” of the Company.  Each series of Notes shall constitute a separate series of Securities for all purposes under the Indenture.  The Notes shall be unsecured.  The Notes shall be executed, authenticated and delivered in accordance with the provisions of the Indenture.  The aggregate principal amount of the 2019 Notes which may be authenticated and delivered under the Indenture is initially limited to $375,000,000, and the aggregate principal amount of the 2044 Notes which may be authenticated and delivered under the Indenture is initially limited to $375,000,000 (except, in each case, for such Notes authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Notes of the same series pursuant to Sections 304, 305, 306, 906 or 1107 of the Base Indenture and except for any Notes which, pursuant to Section 303 of the Base Indenture, are deemed never to have been authenticated and delivered thereunder).  Additional Notes of a series may be authenticated and delivered from time to time as contemplated in Section 301 of the Base Indenture; provided that if the additional Notes of a series are not fungible with the Notes of such series for United States Federal income tax purposes, the additional Notes of the series will have a separate CUSIP number.  The entire amount of Notes of each series may immediately be executed by the Company and delivered to the Trustee and shall be authenticated by the Trustee and delivered to or upon the order of the Company pursuant to Section 303 of the Base Indenture.

 

Section 2.02.  Stated Maturity.  The Stated Maturity of the principal of the 2019 Notes shall be March 15, 2019 and the Stated Maturity of the principal of the 2044 Notes shall be March 15, 2044.

 

Section 2.03.  Notes Issuable as Global Securities.

 

(a)      The Notes shall be issued in the form of one or more Global Securities registered in the name of DTC or its nominee, to be deposited with, or on behalf of, DTC, New York, New York.

 

(b)      The Notes shall be in such form or forms as may be approved by the officers of the Company as provided in the Company Resolutions, such approval to be evidenced by any such officer’s manual or facsimile signature on the Notes, provided that such form or forms of the Notes are not inconsistent with the requirements of the Indenture or the Company Resolutions and are substantially in the form or forms attached hereto as Exhibit A.

 

  

7

  

 

Section 2.04.  Interest and Payment.  The 2019 Notes shall bear interest at the rate of 2.200% per annum and the 2044 Notes shall bear interest at the rate of 4.750% per annum, which in each case will accrue from March 7, 2014, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, as the case may be, payable semi-annually on March 15 and September 15 in each year, commencing September 15, 2014, to the Person in whose name such Notes (or one or more predecessor Notes) are registered at the close of business on the Regular Record Date next preceding the Interest Payment Date.  Each March 15 and September 15 shall be an “Interest Payment Date” for such Notes, and the March 1 or September 1 (whether or not a Business Day), as the case may be, next preceding an Interest Payment Date shall be the “Regular Record Date” for the interest payable on such Interest Payment Date.  In any case where any Interest Payment Date is not a Business Day, then payment of interest may be made on the next succeeding Business Day without any additional amount being payable in respect of any delay.

 

Section 2.05.  Payment of Interest.  Payment of the principal of and premium, if any, and interest on the Notes will be made at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, City of New York; provided, however, that at any time that the Notes are not represented by Global Securities, at the option of the Company, payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register.

 

Section 2.06.  Optional Redemption

 

(a)      At any time prior to February 15, 2019, the 2019 Notes will be redeemable upon not less than 15 calendar days’ nor more than 60 calendar days’ notice by mail, in whole or in part, at the election of the Company, at a Redemption Price equal to the greater of:

 

(i)      100% of the principal amount of the 2019 Notes being redeemed, or

 

(ii)      the sum of the present value of (x) 100% of the principal amount of the 2019 Notes being redeemed and (y) all required remaining scheduled interest payments due on the 2019 Notes being redeemed, in each case calculated as if the Stated Maturity of the 2019 Notes were February 15, 2019, discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 15 basis points,

 

plus, in each case, any interest accrued but not paid to the Redemption Date.

 

  

8

  

 

(b)      At any time on or after February 15, 2019, the 2019 Notes will be redeemable upon not less than 15 calendar days’ nor more than 60 calendar days’ notice by mail, in whole or in part, at the election of the Company, at a Redemption Price equal to 100% of the principal amount of the 2019 Notes being redeemed plus any interest accrued but not paid to the Redemption Date.

 

(c)      At any time prior to September 15, 2043, the 2044 Notes will be redeemable upon not less than 15 calendar days’ nor more than 60 calendar days’ notice by mail, in whole or in part, at the election of the Company, at a Redemption Price equal to the greater of:

 

(i)      100% of the principal amount of the 2044 Notes being redeemed, or

 

(ii)      the sum of the present value of (x) 100% of the principal amount of the 2044 Notes being redeemed and (y) all required remaining scheduled interest payments due on the 2044 Notes being redeemed, in each case calculated as if the Stated Maturity of the 2044 Notes were September 15, 2043, discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 20 basis points,

 

plus, in each case, any interest accrued but not paid to the Redemption Date.

 

(d)      At any time on or after September 15, 2043, the 2044 Notes will be redeemable upon not less than 15 calendar days’ nor more than 60 calendar days’ notice by mail, in whole or in part, at the election of the Company, at a Redemption Price equal to 100% of the principal amount of the 2044 Notes being redeemed plus any interest accrued but not paid to the Redemption Date.

 

(e)      Notice of any redemption will be mailed at least 15 calendar days but no more than 60 calendar days before the Redemption Date to each holder of the Notes of the series to be redeemed.

 

(f)      Unless the Company defaults in payment of the Redemption Price, interest will cease to accrue on the Notes of the series or the portions of the Notes of the series called for redemption on and after the Redemption Date.

 

Section 2.07.  Change of Control Offer to Purchase.

 

(a)      If a Change of Control Triggering Event occurs with respect to the Notes of a series, unless the Company has exercised its right to redeem the Notes of such series in full pursuant to Section 2.06, the Company will make an offer to each Holder of Notes of such series (the “Change of Control Offer”) to

 

  

9

  

 

repurchase any and all (equal to $2,000 or an integral multiple of $1,000) of such Holder’s Notes of such series at a repurchase price in cash equal to 101% of the aggregate principal amount of the Notes of such series to be repurchased plus accrued and unpaid interest, if any, thereon, to the date of repurchase (the “Change of Control Payment”). Within 30 days following any Change of Control Triggering Event with respect to the Notes of a series, the Company will mail a notice to Holders of Notes of such series describing the transaction or transactions that constitute the Change of Control Triggering Event and offering to repurchase the Notes of such series on the date specified in the notice (the “Change of Control Payment Date”), which date will be no less than 30 days and no more than 60 days from the date such notice is mailed, pursuant to the procedures required by the Notes of such series and described in such notice.

 

(b)      The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the Notes of a series as a result of a Change of Control Triggering Event. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control repurchase provisions of the Notes of a series, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control repurchase provisions of the Notes by virtue of such conflicts.

 

(c)      The Company will not be required to offer to repurchase the Notes of a series upon the occurrence of a Change of Control Triggering Event with respect to the Notes of such series if a third party makes such an offer in the manner, at the times and otherwise in compliance with the requirements for an offer made by the Company and the third party repurchases on the applicable date all Notes of such series properly tendered and not withdrawn under its offer; provided that for all purposes of the Notes of such series and the Indenture, a failure by such third party to comply with the requirements of such offer and to complete such offer shall be treated as a failure by the Company to comply with its obligations to offer to purchase the Notes of such series unless the Company promptly makes an offer to repurchase the Notes of such series at 101% of the outstanding principal amount thereof plus accrued and unpaid interest, if any, thereon, to the date of repurchase, which shall be no later than 30 days after the third party’s scheduled Change of Control Payment Date.

 

(d)      On the Change of Control Payment Date for Notes of a series to be repurchased, the Company will, to the extent lawful:

 

(i)      accept or cause a third party to accept for payment all Notes of such series or portions of Notes of such series properly tendered pursuant to the Change of Control Offer;

 

  

10

  

 

(ii)      deposit or cause a third party to deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of each Note of such series or portions of Notes of such series properly tendered; and

 

(iii)     deliver or cause to be delivered to the Trustee the Notes of such series properly accepted, together with an officer’s certificate stating the aggregate principal amount of Notes of such series or portions of Notes of such series being purchased.

 

Section 2.08.  Applicability of Certain Provisions of the Base Indenture in Respect of the Notes.

 

(a)      The Event of Default specified in Section 501(5) of the Base Indenture shall not apply to the Notes.

 

(b)      Section 1005 of the Base Indenture shall not apply to the Notes.

 

(c)      The second line of Section 1104 of the Base Indenture shall be amended to replace “30” with “15” for purposes of the Notes.

 

Section 2.09.  Registrar and Paying Agent.  U.S. Bank National Association shall act as Paying Agent and registrar with respect to the Notes.

 

Section 2.10.  No Sinking Fund.  The Company shall not be obligated to redeem or purchase the Notes of either series pursuant to any sinking fund or analogous provision, or at the option of any Holder thereof, except as provided in Section 2.07 of this Supplemental Indenture.

 

Section 2.11.  Minimum Denominations.  The Notes shall be issuable only in registered form without coupons in denominations of $2,000 and any multiple of $1,000 in excess thereof.

 

 

ARTICLE 3

Miscellaneous

 

Section 3.01.  Relation to Indenture.  This Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder of Securities heretofore or hereafter authenticated and delivered under the Indenture shall be bound hereby.

 

Section 3.02.  Continued Effect. Except as expressly supplemented and amended by this Supplemental Indenture, the Base Indenture shall continue in full force and effect in accordance with the provisions thereof, and the Base Indenture

 

  

11

  

 

is in all respects hereby ratified and confirmed. This Supplemental Indenture and all its provisions shall be deemed a part of the Indenture in the manner and to the extent herein and therein provided.

 

Section 3.03.  Provisions Binding on Company’s Successors.  All of the covenants, stipulations, promises and agreements in this Supplemental Indenture by the Company shall bind its successors and assigns whether so expressed or not.

 

Section 3.04.  Certain Trustee Matters.

 

(a)      The recitals contained herein shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness.

 

(b)      The Trustee makes no representations as to the validity or sufficiency of this Supplemental Indenture or the Notes or the proper authorization or the due execution hereof or thereof by the Company.

 

Section 3.05.  Governing Law.  This Supplemental Indenture and the Notes shall be governed by and construed in accordance with the internal laws of the State of New York.

 

Section 3.06.  Counterparts.  This Supplemental Indenture may be signed in various counterparts which together will constitute one and the same instrument.

 

[signatures follow]

 

  

12

  

 

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.

 

	
AETNA INC., as the Company

	 
	 	 
	 	 
	 	 	 	 
	By:	
/s/ David Buda

	 
	 	Name: 	
David Buda

	 
	 	Title: 	
Vice President and Assistant Treasurer

	 

 

 

 

 

 

 

[Signature page to Supplemental Indenture]

  

 

  

 

	
U.S. BANK NATIONAL

ASSOCIATION, as Trustee

	 
	 	 
	 	 
	 	 	 	 
	By:	/s/ David J Ganss	 
	 	Name: 	 David J Ganss	 
	 	Title: 	 Vice President	 

 

 

 

 

 

 

[Signature page to Supplemental Indenture]

  

 

  

Exhibit A

 

Form of Security

 

THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF.  THIS SECURITY MAY NOT BE TRANSFERRED TO, OR REGISTERED OR EXCHANGED FOR SECURITIES REGISTERED IN THE NAME OF, ANY PERSON OTHER THAN THE DEPOSITARY OR A NOMINEE THEREOF, AND NO SUCH TRANSFER MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.  EVERY SECURITY AUTHENTICATED AND DELIVERED UPON REGISTRATION OF TRANSFER OF, OR IN EXCHANGE FOR OR IN LIEU OF, THIS SECURITY SHALL BE A GLOBAL SECURITY SUBJECT TO THE FOREGOING, EXCEPT IN SUCH LIMITED CIRCUMSTANCES.

 

Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation (“DTC”), to Aetna Inc. or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.

 

AETNA INC.

 

[·]% SENIOR NOTE DUE 20[·]

 

CUSIP: [●]

ISIN: [●]

	
No. 20[·]-1

	
$[·]

 

AETNA INC., a Pennsylvania corporation (herein called the “Company”), which term includes any successor Person under the Indenture hereinafter referred to, for value received, hereby promises to pay to Cede & Co., or registered assigns, the principal sum of [                  ] Dollars ($[·]) upon presentation and surrender of this Security on March 15, 20[·], and to pay interest thereon from March 7, 2014 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, semi-annually on March 15 and

 

  

A-1

  

 

September 15 in each year, commencing September 15, 2014, at the rate of [·]% per annum until the principal hereof is paid or made available for payment.  The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, which shall be the March 1 or September 1 (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date.  Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Securities of this series not less than 10 calendar days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture.  In any case where any Interest Payment Date is not a Business Day, then payment of interest may be made on the next succeeding Business Day without any additional amount being payable in respect of any delay.

 

Payment of the principal of and premium, if any, and interest on this Security will be made at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.

 

Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.  Such provisions include, without limitation, provisions relating to redemption of this Security by the Company.

 

Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

 

  

A-2

  

 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal.

 

Dated: 

 

	
AETNA INC., as the Company

	 
	 	 
	 	 
	 	 	 	 
	By:	 	 
	 	Name: 	
David Buda

	 
	 	Title: 	
Vice President and Assistant Treasurer

	 

 

[SEAL]

 

Attest:

 

 

	 

Judith H. Jones

 

  

A-3

  

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Securities of the series designated under, and referred to in, the within-mentioned Indenture.

 

	
U.S. BANK NATIONAL

ASSOCIATION, as Trustee

	 
	 	 
	 	 
	 	 	 	 
	By:	 	 
	 	
Authorized Officer

	 

 

 

  

A-4

  

 

(Back of Security)

This Security is one of a duly authorized issue of securities of the Company (herein called the “Securities”), issued and to be issued in one or more series under a Senior Indenture, dated as of March 2, 2001 (herein called the “Base Indenture”), between the Company, as issuer, and U.S. Bank National Association (as successor in interest to State Street Bank and Trust Company), as Trustee (herein called the “Trustee”, which term includes any successor trustee under the Indenture), as supplemented by the Supplemental Indenture dated as of March 7, 2014, between the Company and the Trustee (together with the Base Indenture, the “Indenture”), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities and of the terms upon which the Securities are, and are to be, authenticated and delivered.  This Security is one of the series designated on the face hereof, initially limited in aggregate principal amount to $[·], subject to future issuances of additional Securities pursuant to Section 301 of the Base Indenture.

 

	
1. 

	
Optional Redemption.

 

At any time prior to [·], 20[·], the Securities of this series are subject to redemption upon not less than 15 calendar days’ nor more than 60 calendar days’ notice by mail, in whole or in part, at the election of the Company, at a Redemption Price equal to the greater of:

 

	
  

	
·

	
100% of the principal amount of the Securities being redeemed, or

 

	
  

	
·

	
the sum of the present value of (i) 100% of the principal amount of the Securities being redeemed and (ii) all required remaining scheduled interest payments due on the Securities being redeemed, in each case calculated as if the Stated Maturity of such Securities were [·], 20[·], discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus [·] basis points,

 

plus, in each case, any interest accrued but not paid to the Redemption Date.

 

At any time on or after [·], 20[·], the Securities of this series are subject to redemption upon not less than 15 calendar days’ nor more than 60 calendar days’ notice by mail, in whole or in part, at the election of the Company, at a Redemption Price equal to 100% of the principal amount of the Securities being redeemed plus any interest accrued but not paid to the Redemption Date.

 

  

A-5

  

 

“Treasury Rate” means, with respect to any Redemption Date for any portion of the Securities of this series,

 

	
  

	
·

	
the yield, under the heading which represents the average for the immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication which is published weekly by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after the Remaining Life for the Securities of this series, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue will be determined and the Treasury Rate shall be interpolated or extrapolated from those yields on a straight line basis, rounding to the nearest month), or

 

	
  

	
·

	
if the release referred to in the previous bullet (or any successor release) is not published during the week preceding the calculation date or does not contain the yields referred to above, 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 that Redemption Date.

 

The Treasury Rate will be calculated on the third Business Day preceding the Redemption Date.

 

“Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having an actual or interpolated maturity comparable to the remaining term of the Securities of this series to be redeemed, calculated as if the Stated Maturity of the Securities were [·], 20[·] (the “Remaining Life”) that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the Remaining Life of the Securities of this series to be redeemed.

 

“Comparable Treasury Price” means, with respect to any Redemption Date for any Securities of this series, the average of all Reference Treasury Dealer Quotations obtained.

 

“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Trustee after consultation with the Company.

 

  

A-6

  

 

“Reference Treasury Dealer” means each of Credit Suisse Securities (USA) LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and RBS Securities Inc.  If any Reference Treasury Dealer ceases to be a primary U.S. government securities dealer in the United States (a “Primary Treasury Dealer”), the Company shall substitute another Primary Treasury Dealer for that dealer.

 

“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 that Reference Treasury Dealer at 5:00 p.m. on the third Business Day preceding the Redemption Date.

 

Notice of any redemption will be mailed at least 15 calendar days but no more than 60 calendar days before the Redemption Date to each Holder of the Securities of this series to be redeemed. Section 1104 of the Base Indenture is amended to replace “30” with “15” for purposes of the Securities.

 

Unless the Company defaults in payment of the Redemption Price, interest will cease to accrue on the Securities of this series or the portions of the Securities of this series called for redemption on and after the Redemption Date.

 

If this Security is redeemed in part only, a new Security or Securities of this series and of like tenor for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the cancellation hereof.

 

	
2. 

	
Change of Control.

 

If a Change of Control Triggering Event occurs with respect to the Securities of this series, unless the Company has exercised its right to redeem the Securities of this series in full, as described under “Optional Redemption” above, the Company will make an offer to each Holder of the Securities of this series (the “Change of Control Offer”) to repurchase any and all (equal to $2,000 or an integral multiple of $1,000) of such Holder’s Securities of this series at a repurchase price in cash equal to 101% of the aggregate principal amount of the Securities of this series to be repurchased plus accrued and unpaid interest, if any, thereon, to the date of repurchase (the “Change of Control Payment”). Within 30 days following any Change of Control Triggering Event with respect to the Securities of this series, the Company will mail a notice to Holders of the Securities of this series describing the transaction or transactions that constitute the Change of Control Triggering Event and offering to repurchase the Securities of this series on the date specified in the notice (the “Change of Control Payment Date”), which date will be no less than 30 days and no more than 60

 

  

A-7

  

 

days from the date such notice is mailed, pursuant to the procedures required hereby and described in such notice.

 

The Company will comply with the requirements of Rule 14e-1 under the Securities Exchange Act of 1934, as amended from time to time, and any successor statute thereto (the “Exchange Act”), and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the Securities of this series as a result of a Change of Control Triggering Event. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control repurchase provisions of the Securities of this series, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control repurchase provisions of the Securities of this series by virtue of such conflicts.

 

The Company will not be required to offer to repurchase the Securities of this series upon the occurrence of a Change of Control Triggering Event with respect to the Securities of this series if a third party makes such an offer in the manner, at the times and otherwise in compliance with the requirements for an offer made by the Company and the third party repurchases on the applicable date all Securities of this series properly tendered and not withdrawn under its offer; provided that for all purposes of the Securities of this series and the Indenture, a failure by such third party to comply with the requirements of such offer and to complete such offer shall be treated as a failure by the Company to comply with its obligations to offer to purchase the Securities of this series unless the Company promptly makes an offer to repurchase the Securities of this series at 101% of the outstanding principal amount thereof plus accrued and unpaid interest, if any, thereon, to the date of repurchase, which shall be no later than 30 days after the third party’s scheduled Change of Control Payment Date.

 

On the Change of Control Payment Date for the Securities of this series to be repurchased, the Company will, to the extent lawful:

 

	
  

	
·

	
accept or cause a third party to accept for payment all Securities of this series or portions of Securities of this series properly tendered pursuant to the Change of Control Offer;

 

	
  

	
·

	
deposit or cause a third party to deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of each Security of this series or portions of Securities of this series properly tendered; and

 

	
  

	
·

	
deliver or cause to be delivered to the Trustee the Securities of this series properly accepted, together with an officer’s certificate

 

  

A-8

  

 

stating the aggregate principal amount of Securities of this series or portions of Securities being purchased.

 

“Below Investment Grade Rating Event” means the Securities of this series are rated below an Investment Grade Rating by each of the Rating Agencies on any date from the earlier of (1) the occurrence of a Change of Control and (2) public notice of the Company’s intention to effect a Change of Control, in each case until the end of the 60-day period following the earlier of (1) the occurrence of a Change of Control and (2) public notice of the Company’s intention to effect a Change of Control; provided, however, that if (i) during such 60-day period one or more Rating Agencies has publicly announced that it is considering the possible downgrade of the Securities of this series, and (ii) a downgrade by each of the Rating Agencies that has made such an announcement would result in a Below Investment Grade Rating Event, then such 60-day period shall be extended for such time as the rating of the Securities of this series by any such Rating Agency remains under publicly announced consideration for possible downgrade to a rating below an Investment Grade Rating and a downgrade by such Rating Agency to a rating below an Investment Grade Rating could cause a Below Investment Grade Rating Event. Notwithstanding the foregoing, a rating event otherwise arising by virtue of a particular reduction in rating will not be deemed to have occurred in respect of a particular Change of Control (and thus will not be deemed a Below Investment Grade Rating Event for purposes of the definition of Change of Control Triggering Event) if the Rating Agencies making the reduction in rating to which this definition would otherwise apply do not announce or publicly confirm or inform the Trustee in writing at the Company’s or the Trustee’s request that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable Change of Control has occurred at the time of the rating event).

 

“Change of Control” means the occurrence of any of the following: (1) direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of the Company and its subsidiaries taken as a whole to any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) other than to the Company or one of its subsidiaries; (2) the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) other than the Company or one of its subsidiaries becomes the beneficial owner, directly or indirectly, of more than 50% of the then outstanding number of shares of the Company’s voting stock; or (3) the first day on which a majority of the members of the Company’s Board of Directors are not Continuing Directors; provided, however, that a transaction will not be deemed to involve a Change of Control if (A) the Company becomes a wholly owned subsidiary of a holding company and (B)(x) the holders of the

 

  

A-9

  

 

voting stock of such holding company immediately following that transaction are substantially the same as the holders of the Company’s voting stock immediately prior to that transaction or (y) immediately following that transaction no “person” (as that term is used in Section 13(d)(3) of the Exchange Act) is the beneficial owner, directly or indirectly, of more than 50% of the voting stock of such holding company. For purposes of this definition, “voting stock” means capital stock of any class or kind the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of directors (or persons performing similar functions) of the Company, even if the right to vote has been suspended by the happening of such a contingency.

 

“Change of Control Triggering Event” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event.

 

“Continuing Directors” means, as of any date of determination, any member of the Board of Directors of the Company who (1) was a member of the Board of Directors of the Company on the date of the issuance of the Securities; or (2) was nominated for election or elected to the Board of Directors of the Company with the approval of a majority of the Continuing Directors who were members of such Board of Directors of the Company at the time of such nomination or election (either by specific vote or by approval of the Company’s proxy statement in which such member was named as a nominee for election as a director).

 

“Fitch” means Fitch Ratings Inc.

 

“Investment Grade Rating” means a rating by Moody’s equal to or higher than Baa3 (or the equivalent under any successor rating category of Moody’s), a rating by S&P equal to or higher than BBB- (or the equivalent under any successor rating category of S&P), a rating by Fitch equal to or higher than BBB- (or the equivalent under any successor rating category of Fitch), and the equivalent investment grade credit rating from any replacement rating agency or rating agencies selected by the Company under the circumstances permitting the Company to select a replacement agency and in the manner for selecting a replacement agency, in each case as set forth in the definition of “Rating Agencies”.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Rating Agencies” means (1) Moody’s, S&P and Fitch; and (2) if any or all of Moody’s, S&P or Fitch ceases to rate the Securities of this series or fails to make a rating of the Securities of this series publicly available for reasons outside of the Company’s control, a “nationally recognized statistical rating organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act, that the Company selects (pursuant to a resolution of the Company’s Board of Directors)

 

  

A-10

  

 

as a replacement agency for any of Moody’s, S&P or Fitch, or all of them, as the case may be, with respect to the Securities of this series.

 

“S&P” means Standard & Poor’s Ratings Services, a division of McGraw-Hill Financial, Inc.

 

	
3. 

	
Certain Covenants.

 

The Indenture contains certain covenants that, among other things, limit the ability of the Company to consolidate, merge or sell all or substantially all of its assets.  These covenants are subject to a number of important qualifications and exceptions.  Section 1005 of the Base Indenture, including, without limitation, the limitation on liens on the Common Stock of Principal Subsidiaries set forth therein, does not apply to the Securities of this series.

 

	
4. 

	
Events of Default.

 

If an Event of Default with respect to Securities of this series shall occur and be continuing, the principal of the Securities of this series may be declared due and payable in the manner and with the effect provided in the Indenture.  The Event of Default set forth in Section 501(5) of the Base Indenture, including, without limitation, the cross-acceleration provisions thereof, does not apply to the Securities of this series.

 

	
5. 

	
Amendment, Modification and Waiver.

 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in principal amount of the Securities at the time Outstanding of each series to be affected.  The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such series, to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences.  Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not notation of such consent or waiver is made upon this Security.

 

	
6. 

	
Other Matters.

 

  

A-11

  

 

No reference herein to the Indenture and no provision of this Security or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and any premium and interest on this Security at the times, place and rate, and in the coin or currency, herein prescribed.

 

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Security Register upon surrender of this Security for registration of transfer at the office or agency of the Company in any place where the principal of and any premium and interest on this Security are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder hereof or such Holder’s attorney duly authorized in writing, and thereupon one or more new Securities of this series and of like tenor, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

 

The Securities of this series are issuable only in registered form without coupons in denominations of $2,000 and any multiple of $1,000 in excess thereof.  As provided in the Indenture and subject to certain limitations therein set forth, Securities of this series are exchangeable for a like aggregate principal amount of Securities of this series and of like tenor of a different authorized denomination, as requested by the Holder surrendering the same.

 

No service charge shall be made for any such registration of transfer or exchange of Securities, but the Company or the Trustee may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities, other than exchanges pursuant to Section 304, 906 or 1107 of the Base Indenture not involving any transfer.

 

Prior to due and proper presentment of this Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security is overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary.

 

The Indenture provides that the Company, at the Company’s option, (a) will be discharged from any and all obligations in respect of the Securities (except for certain obligations to register the transfer or exchange of Securities, replace stolen, lost or mutilated Securities, maintain paying agencies and hold moneys for payment in trust) or (b) need not comply with certain restrictive covenants of the Indenture, in each case if the Company deposits, in trust, with the Trustee money or U.S. Government Obligations which through the payment of interest thereon

 

  

A-12

  

 

and principal thereof in accordance with their terms will provide money, in an amount sufficient to pay all the principal of and premium, if any, and interest on, the Securities on the dates such payments are due in accordance with the terms of such Securities, and certain other conditions are satisfied.

 

No recourse shall be had for the payment of the principal of and premium, if any, or interest on this Security, 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 incorporator, stockholder, officer, employee, agent or director, as such, past, present or future, of the Company or of any successor corporation, 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 part of the consideration for the issue hereof, expressly waived and released.

 

All terms used in this Security which are defined in the Indenture shall have the respective meanings assigned to them in the Indenture.

 

 

A-13EXHIBIT 4.1

 

 

THE AES CORPORATION

 

as Issuer

 

AND

 

WELLS FARGO BANK, N.A.

 

as Trustee

 

 

SEVENTEENTH SUPPLEMENTAL INDENTURE

 

Dated as of March 7, 2014

 

TO

 

SENIOR INDENTURE

 

Dated as of December 8, 1998

 

 

5.500% Senior Notes due 2024

 

 

 

  

  

  

 

The SEVENTEENTH SUPPLEMENTAL INDENTURE, is dated as of this 7th day of March, 2014 (the “Seventeenth Supplemental Indenture”), between THE AES CORPORATION, a corporation duly organized and existing under the laws of the State of Delaware (hereinafter sometimes referred to as the “Company”), and WELLS FARGO BANK, N.A., a national banking association, as trustee (hereinafter referred to as the “Trustee”), as successor trustee to BANK ONE, NATIONAL ASSOCIATION.

 

WHEREAS, the Company entered into a Senior Indenture dated as of December 8, 1998 (the “Senior Indenture”) between the Company and the Trustee to provide for the future issuance of its senior debentures, notes or other evidences of indebtedness (collectively, the “Securities”), said Securities to be issued from time to time in series as might be determined by the Company pursuant to the Senior Indenture and, in an unlimited aggregate principal amount;

 

WHEREAS, the Company and the Trustee have entered into a First Supplemental Indenture, a Second Supplemental Indenture, a Third Supplemental Indenture, a Fourth Supplemental Indenture, a Fifth Supplemental Indenture, a Sixth Supplemental Indenture, a Seventh Supplemental Indenture, an Eighth Supplemental Indenture, a Ninth Supplemental Indenture, a Tenth Supplemental Indenture, an Eleventh Supplemental Indenture, a Twelfth Supplemental Indenture, a Thirteenth Supplemental Indenture, a Fourteenth Supplemental Indenture, a Fifteenth Supplemental Indenture and a Sixteenth Supplemental Indenture providing for the creation and issuance of various series of Securities and/or amendments to the Senior Indenture (the Senior Indenture, as so amended and supplemented by the forgoing supplemental indentures and this Seventeenth Supplemental Indenture is hereinafter referred to as, the “Indenture”);

 

WHEREAS, pursuant to the terms of the Indenture, the Company desires to provide for the establishment of a new series of its Securities to be known as its 5.500% Senior Notes due 2024, the form and substance of such Notes and the terms, provisions and conditions thereof to be set forth as provided in the Senior Indenture and this Seventeenth Supplemental Indenture; and

 

WHEREAS, the Company desires and has requested the Trustee to join with it in the execution and delivery of this Seventeenth Supplemental Indenture, and all requirements necessary to make this Seventeenth Supplemental Indenture a valid instrument, in accordance with its terms, and to make the 5.500% Senior Notes due 2024, when executed by the Company and authenticated and delivered by the Trustee, the valid obligations of the Company have been satisfied;

 

NOW, THEREFORE, in consideration of the purchase and acceptance of the Notes by the Holders thereof, and for the purpose of setting forth, as provided in the Indenture, the form and substance of the 5.500% Senior Notes due 2024 and the terms, provisions and conditions thereof, the Company covenants and agrees with the Trustee as follows:

 

 

  

2

  

 

ARTICLE ONE

 

DEFINITIONS AND OTHER PROVISIONS

OF GENERAL APPLICATION

 

SECTION 1.1 TERMS DEFINED IN THE INDENTURE.

 

Each capitalized term used but not defined in this Seventeenth Supplemental Indenture shall have the meaning assigned to such term in the Senior Indenture.

 

SECTION 1.2 CERTAIN DEFINITIONS.

 

The following definitions are hereby added to the definitions contained in Section 1.1 of the Senior Indenture, but only with respect to the 5.500% Senior Notes due 2024 issued in accordance with the provisions hereof:

 

“Additional Notes” means any notes issued under this Seventeenth Supplemental Indenture in addition to the Initial Notes having the same terms in all respects as the Initial Notes, provided that, if Additional Notes are not fungible with the Initial Notes for U.S. federal income tax purposes, the Additional Notes will have a separate CUSIP number.

 

“Applicable Premium” means, with respect to any Note on any redemption date, the excess, if any, of (i) the present value on such redemption date of (A) the redemption price of such Note on March 15, 2019 (such redemption price being that set forth in the table in Section 3.1(a)), plus (B) all required remaining scheduled interest payments due on such Note through March 15, 2019 (excluding accrued but unpaid interest, if any, to, but not including, the redemption date) computed using a discount rate equal to the Treasury Rate as of such redemption date plus 50 basis points, over (ii) the principal amount of such Note.

 

“Attributable Debt” means the present value (discounted at the rate of 8.0% per annum compounded monthly) of the obligations for rental payments required to be paid during the remaining term of any lease of more than 12 months.

 

“Board of Directors” means either the Board of Directors of the Company or (except for the purposes of clause (iii) of the definition of “Change of Control”) any committee of such Board duly authorized to act under the Indenture.

 

“Capital Stock” means, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated, whether voting or non-voting) of, or interests in (however designated), the equity of such Person which is outstanding or issued on or after the date of the Indenture, including, without limitation, all Common Stock and Preferred Stock and partnership and joint venture interests of such Person.

 

“Common Stock” means, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated, whether voting or non-voting) of common stock of such Person which is outstanding or issued on or after the date of the Indenture, including, without limitation, all series and classes of such common stock.

 

  

3

  

 

 “Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to March 15, 2019 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.

 

“Comparable Treasury Price” means, with respect to any redemption date: (a) the average of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) on the third Business Day preceding such redemption date, as set forth in the most recently published statistical release designated “H.15 (519)” (or any successor release) published by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded United States treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” or (b) if such release (or any successor release) is not published or does not contain such prices on such Business Day, the average of the Reference Treasury Dealer Quotations for such redemption date.

 

“Change of Control” means the occurrence of one or more of the following events: (i) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all, or substantially all, of the assets of the Company (determined on a consolidated basis) to any Person or group (as that term is used in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended) of Persons, (ii) a Person or group (as so defined) of Persons shall have become the beneficial owner of more than 50% of the outstanding Voting Stock of the Company, or (iii) during any one-year period, individuals who at the beginning of such period constituted the Board of Directors (together with any new director whose election or nomination was approved by a majority of the directors then in office who were either directors at the beginning of such period or who were previously so approved) cease to constitute a majority of the Board of Directors.

 

“Change of Control Offer” has the meaning provided in Section 4.1.

 

“Consolidated Net Assets” means the aggregate amount of assets (less reserves and other deductible items) after deducting current liabilities, as shown on the consolidated balance sheet of the Company and its Subsidiaries contained in the latest annual report to the stockholders of the Company and prepared in accordance with GAAP.

 

“DTC” has the meaning provided in Section 2.1.

 

“Funded Debt” means indebtedness for borrowed money having a maturity of, or by its terms extendible or renewable for, a period of more than 12 months after the date of the determination of the amount thereof.

 

“Global Securities” has the meaning provided in Section 2.1.

 

“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Company.

 

“Initial Notes” means the 5.500% Senior Notes due 2024 of the Company issued on March 7, 2014 and delivered under this Seventeenth Supplemental Indenture.

 

  

4

  

 

“Issue Date” means March 7, 2014, the date of the original issuance of the Initial Notes.

 

“Notes” means the Initial Notes and any Additional Notes issued on or after the Issue Date in accordance with clause (ii) of Section 2.2(a) treated as a single class of securities, as amended or supplemented from time to time in accordance with the terms hereof, that are issued pursuant to this Indenture.

 

“Physical Securities” has the meaning provided in Section 2.1.

 

“Preferred Stock” means, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated, whether voting or non-voting) of preferred or preference stock of such Person which is outstanding or issued on or after the date of the Indenture.

 

“Principal Property” means any building, structure or other facility (together with the land on which it is erected and fixtures comprising a part thereof) used primarily for manufacturing, processing, research, warehousing or distribution, owned or leased by the Company and having a net book value in excess of 2% of Consolidated Net Assets, other than any such building, structure or other facility or portion thereof which is a pollution control facility financed by state or local governmental obligations or which the principal executive officer, president and principal financial officer of the Company determine in good faith is not of material importance to the total business conducted or assets owned by the Company and its Subsidiaries as an entirety.

 

“Reference Treasury Dealer” means Goldman, Sachs & Co., Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC; provided, however, that if any of the foregoing shall cease to be a primary U.S. Government securities dealer in New York City (a “Primary Treasury Dealer”), the Company shall substitute therefor another Primary Treasury Dealer.

 

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Independent Investment Banker, 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 Independent Investment Banker by such Reference Treasury Dealer at 5:00 p.m. on the third Business Day preceding such redemption date.

 

“Repurchase Date” shall have the meaning provided in Section 4.1 hereof.

 

“Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the yield to maturity of the Comparable Treasury Issue, compounded semi-annually, assuming a price for such Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.

 

“Voting Stock” means, with respect to any Person, Capital Stock of any class or kind ordinarily having the power to vote for the election of directors of such Person or other Persons performing similar functions.

 

  

5

  

 

ARTICLE TWO

 

THE NOTES

 

SECTION 2.1 FORM AND DATING.

 

(a)           The Notes shall be substantially in the form of Exhibit A hereto, which is a part of this Seventeenth Supplemental Indenture, with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by the Senior Indenture and this Seventeenth Supplemental Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may be required to comply with the rules of any securities exchange or as may, consistently herewith, be determined by the Officers of the Company executing such Notes, as evidenced by their execution of the Notes. The Notes will initially be issued as Global Securities. The Company initially appoints The Depository Trust Company (“DTC”) and the Trustee to act as Depositary and custodian, respectively, with respect to the Notes. The Company initially appoints the Trustee to act as Paying Agent and Registrar with respect to the Notes. The Notes shall be issued initially in the form of one or more permanent global Notes in registered form, substantially in the form set forth in Exhibit A (the “Global Securities”), registered in the name of the nominee of the Depositary, deposited with the Trustee, as custodian for the Depositary, duly executed by the Company and authenticated by the Trustee as hereinafter provided, and shall bear the legend set forth in Section 2.5. The aggregate principal amount of the Global Securities may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for the Depositary, as hereinafter provided.

 

(b)           Securities issued in exchange for interests in the Global Securities pursuant to Section 2.6 may be issued in the form of Physical Securities (“Physical Securities”).

 

SECTION 2.2 EXECUTION AND AUTHENTICATION.

 

(a)           The Trustee shall authenticate (i) Initial Notes for original issue on the Issue Date in the aggregate principal amount of $750,000,000 and (ii) any Additional Notes, (such Notes to be substantially in the form of Exhibit A) in an unlimited amount, in each case, upon written orders of the Company signed by two Officers. Each such Officers’ Certificate shall specify the amount of Notes to be authenticated, the date on which the Notes are to be authenticated, whether the Notes are to be Initial Notes or Additional Notes issued under clause (i) or (ii), respectively, of the preceding sentence, and the aggregate principal amount of Notes outstanding on the date of authentication, and shall further specify the amount of such Notes to be issued as a Global Security or Physical Securities. Such Notes shall initially be in the form of one or more Global Securities, which (i) shall represent, and shall be denominated in an amount equal to the aggregate principal amount of, the Notes to be issued, (ii) shall be registered in the name of the Depositary for such Global Security or Securities or its nominee and (iii) shall be held by the Trustee as custodian for the Depositary or pursuant to the Depositary’s instruction.

 

(b)           The Notes shall be issuable only in registered form without coupons in the principal amount of at least $2,000 and integral multiples of $1,000 thereafter.

 

  

6

  

 

SECTION 2.3 INTEREST.

 

Interest on the Notes shall be payable in the amount, on the dates and in the manner provided for in the form of the Note attached hereto as Exhibit A.

 

SECTION 2.4 PLACE OF PAYMENT.

 

(a)           The place of payment for the Notes shall be the Borough of Manhattan, The City of New York, or Minneapolis, Minnesota. So long as the Notes are in the form of Registered Global Securities, the Company agrees that payments of interest on, and any portion of the Principal of, the Notes shall be made by the Paying Agent, upon receipt from the Company of immediately available funds, directly to the Depositary (by Federal funds wire transfer).

 

SECTION 2.5 RESTRICTIVE LEGEND.

 

(a)           Each Global Security shall bear the following legend on the face thereof:

 

UNLESS AND UNTIL THIS NOTE IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY, OR BY ANY SUCH NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE COMPANY OR THEIR AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE 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 OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.6 OF THE SUPPLEMENTAL INDENTURE GOVERNING THIS NOTE.

 

  

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SECTION 2.6 SPECIAL TRANSFER PROVISIONS.

 

(a)           The following provisions shall apply with respect to the registration of any proposed transfer of a Note:

 

(i)           If the proposed transferor is a member of, or participant in, the Depositary (an “Agent Member”) holding a beneficial interest in a Global Security, upon receipt by the Registrar of instructions given in accordance with the Depositary’s and the Registrar’s procedures, whereupon the Registrar shall reflect on its books and records the date and a decrease in the principal amount of the applicable Global Security in an amount equal to the principal amount of the beneficial interest in such Global Security to be transferred, and an increase in the applicable Global Security to which the beneficial interest is to be transferred or shall authenticate and deliver one or more Physical Securities of like tenor and amount.

 

ARTICLE THREE

 

OPTIONAL REDEMPTION OF

THE NOTES

 

SECTION 3.1 OPTIONAL REDEMPTION.

 

(a)           On or after March 15, 2019, the Company may redeem all or a part of the Notes, on any one or more occasions, at the redemption prices (expressed as percentages of principal amount) set forth below plus accrued and unpaid interest thereon, if any, to, but not including, the applicable redemption date, if redeemed during the twelve-month period beginning on March 15th of the years indicated below:

 

	
Year

	
Percentage

	
2019                                                                              

	
102.750%

	
2020                                                                              

	
101.833%

	
2021                                                                              

	
100.917%

	
2022 and thereafter                                                                              

	
100.0000%

 

(b)           At any time prior to March 15, 2019, the Company may also redeem all or a part of the Notes at a redemption price equal to 100% of the principal amount of Notes to be redeemed plus the Applicable Premium as of, and accrued and unpaid interest, if any, to, but not including, the redemption date, subject to the rights of holders of record of the Notes on the relevant record date to receive interest due on the relevant interest payment date. Calculation of the Applicable Premium is the responsibility of the Company and the Trustee shall have no duty to calculate or verify the calculation of the Applicable Premium.

 

 

  

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ARTICLE FOUR

 

REPURCHASE OF NOTES

UPON CHANGE OF CONTROL

 

SECTION 4.1 REPURCHASE OF NOTES UPON A CHANGE OF CONTROL.

 

(a)           Upon a Change of Control, each holder of the Notes shall have the right to require that the Company repurchase such holder’s Notes at a repurchase price in cash equal to 101% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of repurchase.

 

(b)           Within 30 days following any Change of Control, the Company shall mail a notice to each Holder of the Notes with a copy to the Trustee stating:

 

(i)           that a Change of Control has occurred and that such Holder has the right to require the Company to repurchase such Holder’s Notes at a repurchase price in cash equal to 101% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of repurchase (the “Change of Control Offer”),

 

(ii)           the circumstances and relevant facts regarding such Change of Control (including information with respect to pro forma historical income, cash flow and capitalization after giving effect to such Change of Control),

 

(iii)           the repurchase date (which shall be not earlier than 30 days or later than 60 days from the date such notice is mailed) (the “Repurchase Date”),

 

(iv)           that any Notes not tendered shall continue to accrue interest,

 

(v)           that any Notes accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Repurchase Date, unless the Company defaults in depositing the purchase amount,

 

(vi)           that Holders electing to have a Note purchased pursuant to a Change of Control Offer will be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Notes completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Repurchase Date,

 

(vii)           that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the close of business on the third Business Day (or such shorter periods as may be required by applicable law) preceding the Repurchase Date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of Notes the Holder delivered for purchase, and a statement that such Holder is withdrawing his election to have such Notes purchased, and

 

(viii)           that Holders which elect to have their Notes purchased only in part will be issued new Notes in a principal amount equal to the unpurchased portion of the Notes surrendered.

 

 

  

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(c)           On the Repurchase Date, the Company shall (i) accept for payment Notes or portions thereof tendered pursuant to the Change of Control Offer; (ii) deposit with the Trustee money sufficient to pay the purchase price of all Notes or portions thereof so tendered and (iii) deliver or cause to be delivered to the Trustee Notes so accepted together with an Officers’ Certificate identifying the Notes or portions thereof tendered to the Company.

 

(d)           The Trustee shall promptly mail to the Holders of the Notes so accepted payment in an amount equal to the purchase price, and promptly authenticate and mail to such Holders a new Note in a principal amount equal to any unpurchased portion of the Notes surrendered. The Company shall publicly announce the results of the Change of Control Offer on or as soon as practicable after the Repurchase Date.

 

(e)           The Company shall comply with all applicable tender offer rules, including without limitation Rule 14e-1 under the Exchange Act, in connection with a Change of Control Offer.

 

ARTICLE FIVE

 

ADDITIONAL COVENANTS APPLICABLE TO THE NOTES

 

SECTION 5.1 RESTRICTIONS ON SECURED DEBT.

 

(a)           If the Company shall incur, issue, assume or guarantee any indebtedness for borrowed money represented by notes, bonds, debentures or other similar evidences of indebtedness, secured by a mortgage, pledge or other lien on any Principal Property or any capital stock or indebtedness held directly by the Company of any Subsidiary of the Company, the Company shall secure the Notes equally and ratably with (or prior to) such indebtedness, so long as such indebtedness shall be so secured, unless after giving effect thereto the aggregate amount of all such indebtedness so secured, together with all Attributable Debt in respect of sale and leaseback transactions involving Principal Properties, would not exceed 15% of the Consolidated Net Assets of the Company.

 

(b)           The foregoing restriction shall not apply to, and there shall be excluded in computing secured indebtedness for the purpose of such restriction, indebtedness secured by (a) property of any Subsidiary of the Company, (b) liens on property of, or on any shares of stock or debt of, any corporation existing at the time such corporation becomes a Subsidiary, (c) liens in favor of the Company or any Subsidiary, (d) liens in favor of U.S. or foreign governmental bodies to secure partial, progress, advance or other payments, (e) liens on property, shares of stock or debt existing at the time of acquisition thereof (including acquisition through merger or consolidation), purchase money mortgages and construction cost mortgages existing at or incurred within 180 days of the time of acquisition thereof, (f) liens existing on the first date on which any Note is authenticated by the Trustee, (g) liens under one or more credit facilities for indebtedness in an aggregate principal amount not to exceed $900,000,000 at any time outstanding, (h) liens incurred in connection with pollution control, industrial revenue or similar financings, and (i) any extension, renewal or replacement of any debt secured by any liens referred to in the foregoing clauses (a) through (h), inclusive.

 

 

  

10

  

 

 

SECTION 5.2 RESTRICTIONS ON SALES AND LEASEBACKS.

 

(a)           The Company shall not enter into any sale and leaseback transaction involving any Principal Property, the acquisition or completion of construction and commencement of full operation of which has occurred more than 180 days prior thereto, unless (a) the Company could incur a lien on such property under the restrictions described in Section 5.1 hereof in an amount  equal to the Attributable Debt with respect to the sale and leaseback transaction without equally and ratably securing the Notes or (b) the Company, within 180 days after the sale or transfer by the Company, applies to the retirement of its Funded Debt an amount equal to the greater of (i) the net proceeds of the sale of the Principal Property sold and leased pursuant to such arrangement or (ii) the fair market value of the Principal Property so sold and leased as determined by the board of directors of the Company; provided that the amount to be applied to the retirement of Funded Debt of the Company shall be reduced by (A) the principal amount of any Notes delivered within 180 days after such sale or transfer to the Trustee for retirement and cancellation, and (B) the principal amount of Funded Debt, other than Notes, voluntarily retired by the Company within 180 days after such sale or transfer; provided further that no retirement referred to in this clause (b) may be effected by payment at maturity or pursuant to any mandatory sinking fund payment or any mandatory prepayment provision.

 

ARTICLE SIX

 

ADDITIONAL EVENTS OF DEFAULT APPLICABLE

TO THE NOTE

 

SECTION 6.1 ADDITIONAL EVENTS OF DEFAULT.

 

(a)           Pursuant to Section 6.1 (f) of the Senior Indenture, an “Event of Default” shall be deemed to occur with respect to the Notes if an event of default, as defined in any indenture or instrument evidencing or under which the Company has as of the date of this Seventeenth Supplemental Indenture or shall thereafter have outstanding any indebtedness, shall happen and be continuing and either (i) such default results from the failure to pay the principal of such indebtedness in excess of $50 million at final maturity of such indebtedness or (ii) as a result of such default the maturity of such indebtedness shall have been accelerated so that the same shall be or become due and payable prior to the date on which the same would otherwise have become due and payable, and such acceleration shall not be rescinded or annulled within 60 days and the principal amount of such indebtedness, together with the principal amount of any other indebtedness of the Company in default, or the maturity of which has been accelerated, aggregates $50 million or more; provided that the Trustee shall not be charged with knowledge of any such default unless written notice thereof shall have been given to the Trustee by the Company, by the holder or an agent of the holder of any such indebtedness, by the trustee then acting under any indenture or other instrument under which such default shall have occurred, or by the holders of not less than 25% in the aggregate principal amount of the Notes at the time outstanding; and provided further that if such default shall be remedied or cured by the Company or waived by the holder of such indebtedness, then the Event of Default described under this Seventeenth Supplemental Indenture shall be deemed likewise to have been remedied, cured or waived without further action on the part of the Trustee, any Holder of Notes or any other person.

 

 

  

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ARTICLE SEVEN

 

MISCELLANEOUS PROVISIONS

 

SECTION 7.1 RATIFICATION.

 

(a)           The Senior Indenture, as supplemented by this Seventeenth Supplemental Indenture, is in all respects ratified and confirmed. This Seventeenth Supplemental Indenture shall be deemed part of the Indenture in the manner and to the extent provided herein and therein.

 

SECTION 7.2 COUNTERPARTS.

 

(a)           This Seventeenth 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.

 

  

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IN WITNESS WHEREOF, the parties hereto have caused this Seventeenth Supplemental Indenture to be duly executed and attested, on the date or dates indicated in the acknowledgments and as of the day and year first above written.

 

	
THE AES CORPORATION, as

the Issuer

	 
	 	 	 	 
	By:	/s/ Willard C. Hoagland III	 
	 	Name: 	Willard C. Hoagland III	 
	 	Title: 	Vice President and Treasurer	 

 

	Attest:	 
	 	 	 	 
	By:	/s/ Thomas M. O'Flynn	 
	 	Name: 	Thomas M. O'Flynn	 
	 	Title: 	

Executive Vice President and Chief Financial Officer

	 

 

	
WELLS FARGO BANK, N.A.,

as Trustee

	 
	 	 	 	 
	By:	/s/ Brandon Horak	 
	 	Name: 	Brandon Horak	 
	 	Title: 	Trust Officer	 

 

	Attest:	 
	 	 	 	 
	By:	/s/ Andrew Nyquist	 
	 	Name: 	Andrew Nyquist	 
	 	Title: 	

Vice President

	 

 

[Signature Page to the Seventeenth Supplemental Indenture]

  

  

  

 

Exhibit A

 

[FORM OF NOTE]*

 

 

[FACE OF NOTE]

 

 

THE AES CORPORATION.

 

 

5.500% Senior Note due 2024

 

	
CUSIP No.

	  
	
ISIN No.

	  
	
No.

	
Principal Amount $

 

THE AES CORPORATION, a Delaware corporation (the “Company”), for value received promises to pay to                  or registered assigns, the principal sum of              Dollars ($                ) on March 15, 2024.

 

Interest Payment Dates: March 15, and September 15; commencing September 15, 2014.

 

Record Dates: The fifteenth calendar day prior to each Interest Payment Date.

 

Reference is made to the further provisions of this Note contained herein, which shall for all purposes have the same effect as if set forth at this place

 * If applicable, add Global Security Legend.

 

  

1

  

 

 

 

	 	By:                                                            

 

    Authorized Signature

 

By:                                                               

 

    Authorized Signature

 

Dated:

 

Certificate of Authentication

 

This is one of the 5.500% Senior Notes due 2024 referred to in the within-mentioned Indenture.

 

	 	
WELLS FARGO BANK, N.A.

 

as Trustee

 

By:   

                      

    Authorized Signatory   

   

 

  

2

  

 

 

[REVERSE OF FORM OF NOTE]

 

THE AES CORPORATION

 

5.500% SENIOR NOTE DUE 2024

 

1.      Interest. THE AES CORPORATION, a Delaware corporation (the “Company,” which definition shall include any successor thereto in accordance with the Indenture (as defined below)), promises to pay, until the principal hereof is paid or made available for payment, interest on the principal amount set forth on the reverse side hereof at a rate of 5.500% per annum. Interest on the Notes will accrue from and including the most recent date to which interest has been paid or, if no interest has been paid, from March 7, 2014 through but excluding the date on which interest is paid. Interest shall be payable in arrears on March 15, and September 15 of each year (each an “Interest Payment Date”), commencing September 15, 2014. Interest will be computed on the basis of a 360-day year of twelve 30-day months. In the event that any date on which interest is payable on the Notes is not a Business Day, then payment of the interest payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), except that, if such Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date.

 

2.      Method of Payment. The Company will pay interest on the Notes (except defaulted interest) to the Persons who are registered Holders of Notes at the close of business on the fifteenth calendar day prior to each Interest Payment Date (each, a “Regular Record Date”). Holders must surrender Notes to a Paying Agent to collect principal payments. The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. At the Company’s option, interest may be paid by check mailed to the registered address of the Holder of this Note.

 

3.      Paying Agent and Registrar. Initially, Wells Fargo Bank, N.A. (the “Trustee”) will act as Paying Agent and Registrar. The Company may change any Paying Agent, Registrar or co-Registrar without notice.

 

4.      Indenture. The Company issued the Notes under an Indenture dated as of December 8, 1998 between the Company and the Trustee as supplemented by the Ninth Supplemental Indenture dated as of April 3, 2003 and the Seventeenth Supplemental Indenture dated as of March 7, 2014 between the Company and the Trustee (said Indenture, as so supplemented, the “Indenture”). This Note is one of an issue of Securities of the Company issued under the Indenture. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S. Code §§ 77aaa-77bbbb) as amended from time to time. The Notes are subject to all such terms, and Holders of the Notes are referred to the Indenture and such Act for a statement of them. Capitalized terms used herein and not otherwise defined have the meanings set forth in the Indenture. The Notes are general unsecured and unsubordinated obligations of the Company ranking pari passu with all of the Company’s unsecured and unsubordinated obligations. The Company may, subject to 

 

  

3

  

 

the terms of the Indenture and applicable law, issue Additional Notes under the Seventeenth Supplemental Indenture. The Notes issued on March 7, 2014 and any Additional Notes subsequently issued shall be treated as a single class for all purposes of the Seventeenth Supplemental Indenture. The Indenture limits the ability of the Company to incur certain secured indebtedness and to enter into certain sale and leaseback transactions.

 

5.      Optional Redemption.

 

(a)           On or after March 15, 2019, the Company may redeem all or a part of the Notes, on any one or more occasions, at the redemption prices (expressed as percentages of principal amount) set forth below plus accrued and unpaid interest thereon, if any, to, but not including, the applicable redemption date, if redeemed during the twelve-month period beginning on March 15th of the years indicated below:

 

	
Year

	
Percentage

	
2019                                                                              

	
102.750%

	
2020                                                                              

	
101.833%

	
2021                                                                              

	
100.917%

	
2022 and thereafter

	
100.0000%

 

(b)           At any time prior to March 15, 2019, the Company may also redeem all or a part of the Notes at a redemption price equal to 100% of the principal amount of Notes to be redeemed plus the Applicable Premium as of, and accrued and unpaid interest, if any, to, but not including, the redemption date, subject to the rights of holders of record of the Notes on the relevant record date to receive interest due on the relevant interest payment date. Calculation of the Applicable Premium is the responsibility of the Company and the Trustee shall have no duty to calculate or verify the calculation of the Applicable Premium.

 

“Applicable Premium” means, with respect to any Note on any redemption date, the excess, if any, of (i) the present value on such redemption date of (A) the redemption price of such Note on March 15, 2019 (such redemption price being that set forth in the table above), plus (B) all required remaining scheduled interest payments due on such Note through March 15, 2019 (excluding accrued but unpaid interest, if any, to, but not including, the redemption date) computed using a discount rate equal to the Treasury Rate as of such redemption date plus 50 basis points, over (ii) the principal amount of such Note.

 

“Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to March 15, 2019 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.

 

“Comparable Treasury Price” means, with respect to any redemption date: (a) the average of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) on the third Business Day preceding such redemption date, as set forth in the most recently published statistical release designated “H.15 (519)” (or any successor release) published by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded United States treasury securities adjusted to constant 

 

  

4

  

 

maturity under the caption “Treasury Constant Maturities,” or (b) if such release (or any successor release) is not published or does not contain such prices on such Business Day, the average of the Reference Treasury Dealer Quotations for such redemption date.

 

“Independent Investment Banker “ means one of the Reference Treasury Dealers appointed by the Company.

 

“Reference Treasury Dealer” means Goldman, Sachs & Co., Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC; provided, however , that if any of the foregoing shall cease to be a primary U.S. Government securities dealer in New York City (a “Primary Treasury Dealer”), the Company shall substitute therefor another Primary Treasury Dealer.

 

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Independent Investment Banker, 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 Independent Investment Banker by such Reference Treasury Dealer at 5:00 p.m. on the third Business Day preceding such redemption date.

 

“Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the yield to maturity of the Comparable Treasury Issue, compounded semi-annually, assuming a price for such Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.

 

6.      Change of Control Offer. Upon the occurrence of a Change of Control, the Company shall be required, as and to the extent set forth in the Indenture, to offer to purchase all of the outstanding Notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, thereon to, but not including, the date of repurchase (subject to the right of the Holders of record on the relevant date to receive interest due on the relevant interest payment date).

 

7.      Sinking Fund. No sinking fund is provided for the Notes.

 

8.      Denominations, Transfer, Exchange. The Notes are in registered form without coupons in denominations of $2,000 and integral multiples of $1,000 thereafter. A Holder may transfer or exchange Notes in accordance with the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay to it any taxes and fees required by law or permitted by the Indenture. The Registrar need not transfer or exchange any Notes or portion of a Note selected for redemption, or transfer or exchange any Notes for a period of 15 days before selection of such Notes to be redeemed.

 

9.      Persons Deemed Owners. The registered holder of a Note may be treated as the owner of it for all purposes.

 

10.      Unclaimed Money. If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent will pay the money back to the Company 

 

  

5

  

 

at its written request. After that, Holders entitled to the money must look to the Company for payment as general creditors unless an “abandoned property” law designates another Person.

 

11.       Amendment, Supplement, Waiver. The Company and the Trustee may, without the consent of the holders of any outstanding Notes, amend, waive or supplement the Indenture or the Notes for certain specified purposes, including, among other things, curing ambiguities, defects or inconsistencies, maintaining the qualification of the Indenture under the Trust Indenture Act of 1939 or making any other change that does not adversely affect the rights of any Holder in any material respect. Other amendments and modifications of the Indenture or the Notes may be made by the Company and the Trustee with the consent of the Holders of not less than a majority of the aggregate principal amount of the outstanding Securities of all series affected, subject to certain exceptions requiring the consent of the Holders of the particular Securities.

 

12.      Successor Corporation. When a successor corporation assumes all the obligations of its predecessor under the Notes and the Indenture and the transaction complies with the terms of Article 5 of the Senior Indenture, the predecessor corporation, subject to certain exceptions, will be released from those obligations.

 

13.      Defaults and Remedies. Events of Default are set forth in the Indenture. Subject to certain limitations in the Indenture, if an Event of Default (other than an Event of Default specified in Section 6.1(d) or (e) of the Senior Indenture with respect to the Company) occurs and is continuing, then the holders of not less than 25% in aggregate principal amount of the outstanding Notes may, or the Trustee may, by written notice to the Company, and the Trustee at the request of not less than 25% in aggregate principal amount of the outstanding Notes will, declare the principal of, plus accrued interest, if any, to be due and payable immediately. If an Event of Default specified in Section 6.1(d) or (e) of the Senior Indenture with respect to the Company occurs and is continuing, the Principal of and accrued interest on all of the Notes shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder. Holders of the Notes may not enforce the Indenture or the Notes except as provided in the Indenture. The Trustee may require indemnity reasonably satisfactory to it before it enforces the Indenture or the Notes. Subject to certain limitations, Holders of a majority in principal amount of the then outstanding Securities of all series issued under the Indenture that are affected may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders of the Notes notice of any continuing default (except a default in payment of principal or interest) if it determines in good faith that withholding notice is in their interests. The Company must furnish an annual compliance certificate to the Trustee.

 

14.      Trustee Dealing with Company. The Trustee, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not Trustee.

 

15.      No Recourse Against Others. A director, officer, employee, stockholder or beneficiary, as such, of the Company shall not have any liability for any obligations of the Company under the Notes or the Indenture or for any claim based on, in respect of or by reason of, such obligations or their creation. Each Holder of the Notes by accepting a Note waives and 

 

  

6

  

 

releases all such liability. The waiver and release are part of the consideration for the issue of the Notes.

 

16.       Defeasance. The Indenture contains provisions (which provisions apply to this Note) for defeasance at any time of (a) the entire indebtedness of the Company in respect of this Note and (b) certain restrictive covenants and Defaults and Events of Default, in each case upon compliance by the Company with certain conditions set forth therein.

 

17.      Authentication. This Note shall not be valid until the Trustee signs the certificate of authentication on the other side of this Note.

 

18.      Abbreviations

 

. Customary abbreviations may be used in the name of a Holder of Notes or an assignee, such as: TEN COM (= tenants in common), TENANT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

 

19.      GOVERNING LAW. THE INDENTURE AND THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

 

  

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The Company will furnish to any Holder of Notes upon written request and without charge a copy of the Indenture. Requests may be made to:

 

 

THE AES CORPORATION

4300 Wilson Boulevard

Arlington, Virginia 22203

Telephone: (703) 522-1315

Telecopy: (703) 528-4510

Attention: Legal Department

 

  

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ASSIGNMENT FORM

 

 

If you the holder want to assign this Note, fill in the form below and have your signature guaranteed:

 

	
I or we assign and transfer this Note to

	 

 

	(Insert assignee’s social security or tax ID number)	 

 

(Print or type assignee’s name, address and zip code) and irrevocably appoint_______________________ agent to transfer this Note on the books of the Company. The agent may substitute another to act for him.

 

 

	Date:	   	 	Your signature:	 
	 	 	 	 	(Sign exactly as your name appears on the other side of this Note)

 

	Signature Guarantee: 	 

 

Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Securities Transfer Agents Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

 

  

9

  

 

OPTION OF HOLDER TO ELECT TO PURCHASE

 

	Wells Fargo Bank, N.A. 	[Date]   

Corporate Trust Services

625 Marquette Avenue

MAC N9311-110

Minneapolis, MN 55479

Attn: AES Corporation Administrator

Attention:

 

	
  

	
Re:

	
The AES Corporation

	
  

	
5.500% Senior Notes due 2024 (the “Notes”)

 

The undersigned hereby elects to have [all] [a portion of] its Notes purchased by the Company pursuant to Section 4.1 of the Seventeenth Supplemental Indenture.

 

If the undersigned elects to have only part of its Notes purchased by the Company pursuant to Section 4.1 of the Seventeenth Supplemental Indenture, state the principal amount (minimum amount of $2,000; multiples of $1,000 in excess of $2,000):               

 

	 	 	 	$	 	 
	 	 	 	 	 	 

 

	Dated:	 	 	Signed:	 	 
	 	 	 	 	(Sign exactly as name	 
	 	 	 	 	appears on the other	 
	 	 	 	 	side of this Security)	 
	 	 	 	 	 	 
	Signature Guarantee:  	 	 	 
	 	 	
Participant in a recognized Signature Guarantee 

Medallion Program (or other signature guarantor 

program reasonably acceptable to the Trustee)

 

 

	 	
 

	 

 

10

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