Document:

EXHIBIT 10.1

 

SECOND AMENDMENT TO  
 AMENDED AND RESTATED FORBEARANCE AGREEMENT

 

THIS SECOND AMENDMENT TO THE AMENDED AND RESTATED FORBEARANCE AGREEMENT (hereinafter, this “Amendment”), dated as of June 15, 2012, is by and among YA GLOBAL INVESTMENTS, L.P., formerly known as Cornell Capital Partners, LP  (the “Lender”), a Cayman Islands exempt limited partnership with an office located at 101 Hudson Street, Suite 3700, Jersey City, New Jersey 07302, HOMELAND SECURITY CAPITAL CORPORATION, a Delaware corporation  (the “Company”) with its principal office located at 4601 Fairfax Road, Suite 1200, Arlington, VA 22203, CSS MANAGEMENT CORP. (formerly known as Corporate Security Solutions, Inc.) a Pennsylvania corporation (“CSS”) with its principal office located at 4601 Fairfax Road, Suite 1200, Arlington, VA 22203 and FIDUCIA HOLDINGS CORPORATION, a Delaware corporation (“Fiducia Corporation”) with its principal office located at 4601 Fairfax Road, Suite 1200, Arlington, VA 22203.  Unless otherwise defined herein, capitalized terms used herein shall have the meanings assigned in the Forbearance Agreement (as defined below).

 

WITNESSETH

 

WHEREAS, the Lender, the Company, NTG Management Corp. (f/k/a Nexus Technologies Group, Inc.) (“Nexus”) and Fiducia Holdings LLC (“Fiducia”) entered into an Amended and Restated Forbearance Agreement dated as of October 26, 2011 (the “Forbearance Agreement”);

 

WHEREAS, CSS guaranteed the obligations of the Company to the Lender pursuant to that certain Guaranty Agreement dated as of November 11, 2011 and joined the Security Agreement pursuant to that certain Joinder Agreement dated as of November 11, 2011 by CSS, the Company, Fiducia and NTG in favor of the Lender;

 

WHEREAS, on January 20, 2012, prior to its dissolution, Nexus contributed to the Company 100% of its equity interests in CSS;

 

WHEREAS, Nexus was dissolved pursuant to the certain Certificate of Dissolution filed on January 20, 2012 with the Secretary of State for the State of Delaware;

 

WHEREAS, effective December 31, 2011, Fiducia and Fiducia Corporation entered into a Contribution and Exchange Agreement (the “Contribution Agreement”), pursuant to which the holders of the units of Fiducia transferred, assigned and contributed such units to Fiducia Corporation in exchange for a number of validly issued, fully paid and non-assessable shares of common stock and Series A Preferred Stock of Fiducia Corporation in accordance with the terms and conditions thereof;

 

WHEREAS, Fiducia Corporation guaranteed the obligations of the Company to the Lender pursuant to that certain Guaranty Agreement dated as of May 11, 2012 and joined the Security Agreement pursuant to that certain Joinder Agreement dated as of May 11, 2012 by Fiducia Corporation, the Company, CSS and NTG in favor of the Lender;

 

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WHEREAS, Fiducia was dissolved pursuant to that certain Certificate of Cancellation filed on May 7, 2012 with the Secretary of State for the State of Delaware;

 

WHEREAS, the Existing Defaults have not been remedied on or prior to the Forbearance Termination Date and are continuing as of the date hereof; and

 

WHEREAS, the Company has requested that the Lender extend the Forbearance Period by extending the Termination Date from June 29, 2012 to August 31, 2012, and the Lender is willing to do so, but only on the terms and conditions set forth herein.

 

NOW THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

 

Amendments

 

1.                                       The definition of “Termination Date” in Section 1 of the Forbearance Agreement shall be deleted in its entirety and replaced with the following language:

 

“Termination Date” means August 31, 2012.”

 

2.                                       Exhibit A to the Forbearance Agreement shall be amended by adding to the list of documents, instruments and agreements the following:

 

“44.                           Guaranty Agreement dated as of May 11, 2012 by Fiducia Holdings Corporation in favor of Lender;

 

45.                                 Joinder Agreement dated as of May 11, 2012 by Fiducia Holding Corporation, the Company, CSS and NTG in favor of the Lender;

 

46.                                 Side Letter Concerning Removing Equity Transfer Restrictions dated May 11, 2012 by the shareholders of Fiducia Holdings Corporation in favor of the Lender;

 

47.                                 Letter Agreement Regarding Assumption of Obligations under Fiducia Real Estate Solutions Side Letter dated May 11, 2012 by Fiducia Holdings Corporation in favor of the Lender.”

 

Agreements

 

3.                                       On or before July 13, 2012, the Company shall deliver to the Lender one or more certificated securities representing 100% of the Company’s equity interests in CSS, along with executed and undated stock power(s) in form and substance satisfactory to the Lender, in its sole and exclusive discretion.

 

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Effective Date

 

4.                                       This Amendment shall become effective as of the date hereof upon receipt by the Lender of counterparts of the Amendment duly executed and delivered by the Company, Fiducia Corporation and CSS.

 

Interpretation

 

5.                                       The Lender, the Company, CSS and Fiducia Corporation each hereby acknowledges and agrees that the Forbearance Agreement and the Financing Documents shall continue to be and shall remain unchanged and in full force and effect in accordance with their terms.  Any terms or conditions contained in this Amendment shall control over any inconsistent terms or conditions in the Forbearance Agreement.

 

6.                                       Nothing contained in this Amendment shall be construed or interpreted or is intended as a waiver of any default or Event of Default or of any rights, powers, privileges or remedies that the Lender has or may have under the Forbearance Agreement, the Financing Documents and/or applicable law on account of such default or Event of Default.

 

7.                                       For purposes of the Forbearance Agreement, the representations, warranties and covenants contained in this Amendment shall be deemed to be, and shall be, representations, warranties and covenants under the Financing Documents.  Without limiting the foregoing sentence, if the Company, CSS and/or Fiducia Corporation breach(es) any provision contained herein, or should any representation or warranty set forth herein be untrue, then such event shall, without the necessity of any further action by any party, automatically constitute an Event of Default and a Termination Event.

 

Waiver of Claims

 

8.                                       The Company, CSS and Fiducia Corporation each hereby acknowledges and agrees that it has no offsets, defenses, claims, or counterclaims against the Lender, its general partner, and its investment manager, and each of their respective agents, servants, attorneys, advisors, officers, directors, employees, affiliates, representatives, investors, partners, members, managers, predecessors, successors, and assigns (collectively, the “Lender Parties”) and that if the Company, CSS or Fiducia Corporation now has, or ever did have, any offsets, defenses, claims, or counterclaims against the Lender  Parties, or any one of them, whether known or unknown, at law or in equity, from the beginning of the world through the date hereof , all of them are hereby expressly WAIVED, and the Company, CSS and Fiducia Corporation each hereby RELEASES the Lender Parties from any liability therefor.

 

Acknowledgment of Indebtedness

 

9.                                       The principal and interest figures set forth in Section 9 of the Forbearance Agreement are hereby updated as of the date hereof as follows, and the Company, CSS and Fiducia Corporation each hereby acknowledges and agrees that, in accordance with the terms and conditions of the Financing Documents, it is liable to the Lender as follows:

 

a.                                       Due under November 28 Promissory Note as of the date hereof:

 

3

 

	
Principal
    	
 
    	
$
    	
0
    	
 
    
	
Interest
    	
 
    	
$
    	
20,454.09
    	
 
    
	
Total
    	
 
    	
$
    	
20,454.09
    	
 
    

 

b.                                      Due under the November 26 Promissory Note as of the date hereof:

 

	
Principal
    	
 
    	
$
    	
0
    	
 
    
	
Interest
    	
 
    	
$
    	
51,344.09
    	
 
    
	
Total
    	
 
    	
$
    	
51,344.09
    	
 
    

 

c.                                       Due under the First March 2008 Promissory Note as of the date hereof:

 

	
Principal
    	
 
    	
$
    	
0
    	
 
    
	
Interest
    	
 
    	
$
    	
0
    	
 
    
	
Total
    	
 
    	
$
    	
0
    	
 
    

 

d.                                      Due under the Second March 2008 Promissory Note as of the date hereof:

 

	
Principal
    	
 
    	
$
    	
1,263,903.81
    	
 
    
	
Interest
    	
 
    	
$
    	
2,053,595.31
    	
 
    
	
Total
    	
 
    	
$
    	
3,317,499.12
    	
 
    

 

e.                                       Due under the Third March 2008 Promissory Note as of the date hereof:

 

	
Principal
    	
 
    	
$
    	
0
    	
 
    
	
Interest
    	
 
    	
$
    	
1,786,033.69
    	
 
    
	
Total
    	
 
    	
$
    	
1,786,033.69
    	
 
    

 

f.                                         For all interest accruing upon the principal balances of the Promissory Notes from and after the date hereof, and for all fees, redemption premiums, liquidated damages, costs, expenses, and costs of collection (including attorneys’ fees and expenses) heretofore or hereafter accrued or incurred by the Lender in connection with the Financing Documents.

 

Representations, Warranties, and Covenants

 

10.                                 The Company, CSS and Fiducia Corporation each hereby represents, warrants, and covenants to the Lender as follows:

 

a.                                       The execution and delivery of this Amendment by the Company, CSS and Fiducia Corporation and the performance by the Company, CSS and Fiducia Corporation of its obligations and agreements under this Amendment, the Forbearance Agreement, and the Financing Documents are within the authority of the Company, CSS and Fiducia Corporation, have been duly authorized by all necessary corporate proceedings, if applicable, on behalf of the Company, CSS and Fiducia Corporation and do not and will

 

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not contravene any provision of law, statute, rule or regulation to which the Company, CSS or Fiducia Corporation is subject or, if applicable, the Company’s, CSS’s or Fiducia Corporation’s charter, other organization papers, by-laws or any stock provision or any amendment thereof or of any agreement or other instrument binding upon the Company,  CSS and/or Fiducia Corporation.

 

b.                                      This Amendment, the Forbearance Agreement and the Financing Documents constitute legal, valid and binding obligations of the Company, CSS and Fiducia Corporation, enforceable in accordance with their respective terms, except as limited by bankruptcy, insolvency, moratorium, fraudulent transfer, reorganization and other laws of general applicability relating to or affecting the rights or remedies of creditors and by general equitable principles (whether considered in a proceeding in equity or at law).

 

c.                                       No approval or consent of, or filing with, any governmental agency or authority is required to make valid and legally binding the execution, delivery or performance by the Company, CSS and/or Fiducia Corporation of this Amendment, the Forbearance Agreement or any of the Financing Documents.

 

d.                                      The Company, CSS and Fiducia Corporation have performed and complied in all material respects with all terms and conditions herein required to be performed or complied with by the Company, CSS and Fiducia Corporation prior to or at the time hereof, and as of the date hereof, and to the best knowledge of the Company, CSS and Fiducia Corporation, no default and/or Event of Default has occurred and is continuing under any of the Financing Documents, with the sole exception of the Existing Defaults.

 

e.                                       The representations and warranties contained in the Financing Documents were true and correct in all material respects at and as of the date made and are true and correct as of the date hereof, except to the extent of changes resulting from transactions specifically contemplated or specifically permitted by this Amendment, the Forbearance Agreement and the Financing Documents, and changes occurring in the ordinary course of business that singly or in the aggregate are not materially adverse to the financial condition of the Company, CSS and/or Fiducia Corporation and to the extent that such representations and warranties relate expressly to an earlier date.

 

f.                                         To the best knowledge of the Company, CSS and Fiducia Corporation, the Company,  CSS and Fiducia Corporation currently have no commercial tort claims (as such term is defined in the Code), and each of the Company, CSS and Fiducia Corporation hereby covenants and agrees that in the event it shall hereafter hold or acquire a commercial tort claim, it shall immediately notify the Lender of the particulars of such claim in writing and shall grant to the Lender a security interest therein and in the proceeds thereof, upon such terms and documentation as may be satisfactory to the Lender.

 

g.                                      The Company, CSS and Fiducia Corporation have read and understand each of the terms and conditions of this Amendment and confirms that it is entering into this Amendment freely and voluntarily, without duress, after having had an opportunity for consultation with independent counsel of its own selection, and not in reliance upon any representations, warranties, or agreements made by the Lender and not set forth in this Amendment.

 

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Entire Agreement

 

11.                                 This Amendment shall be binding upon the Company, CSS, Fiducia Corporation and the Company’s, CSS’s and Fiducia Corporation’s employees, representatives, successors, and assigns, and shall inure to the benefit of the Lender and the Lender’s successors and assigns.  The Forbearance Agreement, as amended by the Amendment, incorporates all of the discussions and negotiations between the Company, CSS, Fiducia Corporation and the Lender, either expressed or implied, concerning the matters included herein and in such other documents, instruments and agreements, any statute, custom, or usage to the contrary notwithstanding.  No such discussions or negotiations shall limit, modify, or otherwise affect the provisions hereof.  No modification, amendment, or waiver of any provision of the Forbearance Agreement, as amended by this Amendment, or any provision of any other document, instrument, or agreement between the Company, CSS and/or Fiducia Corporation, on the one hand, and the Lender, on the other hand, shall be effective unless executed in writing by the party to be charged with such modification, amendment, or waiver, and if such party be the Lender, then by a duly authorized officer thereof.

 

Construction of Amendment

 

12.                                 In connection with the interpretation of this Amendment:

 

a.                                       All rights and obligations hereunder and thereunder, including matters of construction, validity, and performance, shall be governed by and construed in accordance with the law of the State of New Jersey and are intended to take effect as sealed instruments.

 

b.                                      The captions of this Amendment are for convenience purposes only, and shall not be used in construing the intent of the Lender or the Company, CSS or Fiducia Corporation under this Amendment.

 

c.                                       Except as specifically modified herein, all terms and conditions of the Forbearance Agreement shall remain in full force and effect.

 

d.                                      The Lender, the Company, CSS and Fiducia Corporation have prepared this Amendment with the aid and assistance of their respective counsel.  Accordingly, all of them shall be deemed to have been drafted by the Lender, the Company, CSS or Fiducia Corporation and shall not be construed against the Lender, the Company, CSS or Fiducia Corporation.

 

Illegality or Unenforceablility

 

13.                                 Any determination that any provision or application of this Amendment is invalid, illegal, or unenforceable in any respect, or in any instance, shall not affect the validity, legality, or enforceability of any such provision in any other instance, or the validity, legality, or enforceability of any other provision of this Amendment.

 

Counterparts

 

14.                                This Amendment may be executed in multiple identical counterparts, each of which when duly executed shall be deemed an original, and all of which shall be construed together as one agreement.

 

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IN WITNESS WHEREOF, this Amendment has been executed as of the date first set forth above.

 

 

	
 
    	
HOMELAND   SECURITY CAPITAL CORPORATION
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   C. Thomas McMillen
    
	
 
    	
 
    	
Name:   C. Thomas McMillen
    
	
 
    	
 
    	
Title:   Chief Executive Officer and President
    
	
 
    	
 
    	
 
    
	
 
    	
CSS   MANAGEMENT CORP.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Michael T. Brigante
    
	
 
    	
 
    	
Name:   Michael T. Brigante
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
FIDUCIA   HOLDINGS CORPORATION
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   C. Thomas McMillen
    
	
 
    	
 
    	
Name:   C. Thomas McMillen
    
	
 
    	
 
    	
Title:   Chief Executive Officer
    
	
 
    	
 
    	
 
    
	
 
    	
YA   GLOBAL INVESTMENTS, L.P.
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
Yorkville   Advisors, LLC
    
	
 
    	
Its:
    	
Investment   Manager
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Gerald Eicke
    
	
 
    	
 
    	
Name:   Gerald Eicke
    
	
 
    	
 
    	
Title:   Managing MemberExhibit 4.1

 

ATLANTIC POWER CORPORATION

 

AND

 

COMPUTERSHARE TRUST COMPANY OF CANADA

 

 

SECOND SUPPLEMENTAL INDENTURE

 

TO TRUST INDENTURE DATED DECEMBER 17, 2009

 

 

PROVIDING FOR THE ISSUE OF SERIES C CONVERTIBLE UNSECURED
 SUBORDINATED DEBENTURES

 

 

July 5, 2012

 

 

TABLE OF CONTENTS

 

	
ARTICLE 1 INTERPRETATION
    	
2
    
	
1.1
    	
Interpretation
    	
2
    
	
1.2
    	
Additional   Definitions
    	
2
    
	
1.3
    	
Headings   Etc.
    	
3
    
	
1.4
    	
Day   not a Business Day
    	
3
    
	
1.5
    	
Applicable   Law
    	
3
    
	
1.6
    	
Monetary   References
    	
3
    
	
1.7
    	
Invalidity/Severability
    	
3
    
	
1.8
    	
Time of Essence
    	
4
    
	
1.9
    	
Language
    	
4
    
	
1.10
    	
Successors   and Assigns
    	
4
    
	
1.11
    	
Benefits   of Supplemental Indenture
    	
4
    
	
ARTICLE 2 TERMS OF SERIES C DEBENTURES
    	
4
    
	
2.1
    	
Terms   of Series C Debentures
    	
4
    
	
2.2
    	
Delivery
    	
16
    
	
2.3
    	
Legends and Certification
    	
16
    
	
ARTICLE 3 CONFIRMATION OF TRUST INDENTURE
    	
16
    
	
3.1
    	
Confirmation   of Trust Indenture
    	
16
    
	
ARTICLE 4 ACCEPTANCE OF TRUST BY DEBENTURE   TRUSTEE
    	
16
    
	
4.1
    	
Acceptance   of Trust
    	
16
    
	
ARTICLE 5 EXECUTION AND FORMAL DATE
    	
17
    
	
5.1
    	
Execution
    	
17
    
	
5.2
    	
Formal   Date
    	
17
    
	
SCHEDULE “A”   FORM OF SERIES C DEBENTURES
    	
 
    
	
SCHEDULE “B” FORM OF REDEMPTION NOTICE
    	
 
    
	
SCHEDULE “C” FORM OF MATURITY NOTICE
    	
 
    
	
SCHEDULE “D” FORM OF NOTICE OF CONVERSION
    	
 
    
	
SCHEDULE “E” FORM OF NOTICE OF PUT EXERCISE
    	
 
    

 

i

 

ATLANTIC POWER CORPORATION

5.75% SERIES C CONVERTIBLE UNSECURED SUBORDINATED DEBENTURES DUE JUNE 30, 2019

 

SECOND SUPPLEMENTAL INDENTURE

 

This Second Supplemental Indenture is made as of the 5 day of  July, 2012.

 

B E T W E E N:

 

ATLANTIC POWER CORPORATION, a corporation continued under the laws of the Province of British Columbia

 

(the “Company”)

 

- and -

 

COMPUTERSHARE TRUST COMPANY OF CANADA, a trust company authorized to carry on business in all of the provinces and territories of Canada

 

(the “Debenture Trustee”)

 

WHEREAS:

 

A.                                    By a Trust Indenture made as of December 17, 2009 between the Company and the Debenture Trustee (the “Trust Indenture”), provision was made for the issuance of debentures in one or more series, unlimited as to aggregate principal amount but issuable only upon and subject to the conditions and limitations therein set forth;

 

B.                                    Pursuant to an underwriting agreement dated June 26, 2012 (the “Underwriting Agreement”) among the Company, TD Securities Inc., BMO Nesbitt Burns Inc., CIBC World Markets Inc., RBC Dominion Securities Inc., National Bank Financial Inc., Scotia Capital Inc., Desjardins Securities Inc.  and Macquarie Capital Markets Canada Ltd., the Company has agreed to create and issue pursuant to the Trust Indenture and this second supplemental indenture to the Trust Indenture (the “Supplemental  Indenture”), a series of debentures in aggregate principal amount of up to US$130 million to be designated as the “5.75% Series C Convertible Unsecured Subordinated Debentures due June 30, 2019” (the “Series C Debentures”);

 

C.                                    When certified by the Debenture Trustee and issued as provided in this Supplemental Indenture, all necessary steps in relation to the Company will have been duly enacted, passed and/or confirmed and other proceedings taken and conditions complied with to make the creation and issue of the Series C Debentures proposed to be issued hereunder legal, valid and binding on the Company in accordance with the laws relating to the Company;

 

D.                                    This Supplemental Indenture is hereinafter sometimes referred to as the “Second Supplemental Indenture”; and

 

 

E.                                     The foregoing recitals are made as representations and statements of fact by the Company and not by the Debenture Trustee;

 

NOW THEREFORE it is hereby covenanted, agreed and declared as follows:

 

ARTICLE 1

INTERPRETATION

 

1.1                               Interpretation

 

This Second Supplemental Indenture is supplemental to the Trust Indenture and shall be read in conjunction therewith.  Except only insofar as the Trust Indenture may be inconsistent with the express provisions of this Second Supplemental Indenture, in which case the terms of this Second Supplemental Indenture shall govern and supersede those contained in the Trust Indenture only to the extent of such inconsistency, this Second Supplemental Indenture shall henceforth have effect so far as practicable as if all the provisions of the Trust Indenture and this Second Supplemental Indenture were contained in one instrument.  The expressions used in this Second Supplemental Indenture and in the Series C Debentures that are defined in the Trust Indenture shall, except as otherwise provided herein, have the respective meanings ascribed to them in the Trust Indenture.  Unless otherwise stated, any reference in this Second Supplemental Indenture to an Article, Section or Schedule shall be interpreted as a reference to the stated Article, Section of or Schedule to, this Second Supplemental Indenture.

 

1.2                               Additional Definitions

 

In this Second Supplemental Indenture and in the Series C Debentures, unless there is something in the subject matter or context inconsistent therewith, the expressions following shall have the following meanings, namely:

 

“2012 Offering”  means the public offering under a Canadian short form prospectus dated June 26, 2012 and a U.S. prospectus dated  June 26, 2012 of US$130 million aggregate principal amount of Series C Debentures.

 

“Applicable Period” means for each regular cash dividend or distribution, the period announced by the Company, in respect of which such dividend or distribution is payable.  As of the date hereof, the Applicable Period is one month.  If, however, the Company announces a regular quarterly, semi-annual or annual dividend or distribution, then the Applicable Period will be deemed to be the related quarterly, semi-annual or annual period.

 

“Current Market Price” means the volume weighted average price of the Common Shares on the NYSE for the 20 consecutive trading days ending on the fifth trading day preceding the date of applicable event (or, if not listed thereon, on such stock exchange on which Common Shares are listed or, if the Common Shares are not listed on any stock exchange, then on the over-the-counter market)  or, if there is no market, fair value as determined by an independent financial advisor.

 

“Initial Dividend Threshold” means C$0.09583 per Common Share in respect of a monthly Applicable Period, and proportionately adjusted in the case of an Applicable Period that is not

 

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one month (which would be C$0.28749 per Common Share for a quarterly dividend or distribution, C$0.57498 per Common Share for a semi-annual dividend or distribution or C$1.14996 per Common Share for an annual dividend or distribution).

 

“Maturity Date” means June 30, 2019.

 

“MI 62-104” means Multilateral Instrument 62-104 — Take-Over Bids and Issuer Bids.

 

“NYSE” means the New York Stock Exchange.

 

“Underwriters” means, collectively, TD Securities Inc., BMO Nesbitt Burns Inc., CIBC World Markets Inc., RBC Dominion Securities Inc., National Bank Financial Inc., Scotia Capital Inc., Desjardins Securities Inc.  and Macquarie Capital Markets Canada Ltd.

 

1.3                               Headings Etc.

 

The division of this Second Supplemental Indenture into Articles and Sections, the provision of a Table of Contents and the insertion of headings are for convenience of reference only and shall not affect the construction or interpretation of this Second Supplemental Indenture or of the Series C Debentures.

 

1.4                               Day not a Business Day

 

In the event that any day on which any action required to be taken hereunder is not a Business Day, then such action shall be required to be taken on or before the requisite time on the next succeeding day that is a Business Day.

 

1.5                               Applicable Law

 

This Second Supplemental Indenture and the Series C Debentures shall be construed in accordance with the laws of the Province of Ontario and the laws of Canada applicable therein and shall be treated in all respects as Ontario contracts.  The Company hereby irrevocably attorns to the jurisdiction of the courts of the Province of Ontario.

 

1.6                               Monetary References

 

Whenever any amounts of money are referred to herein, such amounts shall be deemed to be in lawful money of the U.S. unless otherwise expressed.

 

1.7                               Invalidity/Severability

 

In case any provision in this Supplemental Indenture or in the Series C Debentures shall be invalid, illegal, prohibited or unenforceable, such provision shall be deemed to be severed herefrom or therefrom and shall be ineffective only to the extent of such prohibition or unenforceability.  The validity, legality and enforceability of the remaining provisions shall not in any way be affected, prejudiced or impaired thereby.

 

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1.8                               Time of Essence

 

Time shall be of the essence of this Supplemental Indenture.

 

1.9                               Language

 

Each of the parties hereto hereby acknowledges that it has consented to and requested that this Supplemental Indenture and all documents relating thereto, including, without limiting the generality of the foregoing, the form of Debenture attached hereto as Schedule “A”, be drawn up in the English language only.

 

Les parties aux présents reconnaissent avoir accepté et demandé que le présent acte de fiducie et tous les documents s’y rapportant, y compris, sans restreindre la portée générale de ce qui précède, le formulaire de débenture joint aux présents à titre d’annexe “A”, soient rédigés en langue anglaise seulement.

 

1.10                        Successors and Assigns

 

All covenants and agreements in this Supplemental Indenture by the Company shall bind its respective successors and assigns, whether expressed or not. All covenants and agreements in this Supplemental Indenture by the Trustee shall bind its successors, whether expressed or not.

 

1.11                        Benefits of Supplemental Indenture

 

Nothing in this Second Supplemental Indenture or in the Series C Debentures, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder, any paying agent, the holders of Series C Debentures, the Senior Creditors (to the extent provided in Article 5 of the Trust Indenture only), and (to the extent provided in Section 8.11 of the Trust Indenture) the holders of Common Shares, any benefit or any legal or equitable right, remedy or claim under this Second Supplemental Indenture.

 

ARTICLE 2

TERMS OF SERIES C DEBENTURES

 

2.1                               Terms of Series C Debentures

 

(a)                                 The Series C Debentures, being the third series of Debentures authorized under the Trust Indenture, as supplemented by this Second Supplemental Indenture, for issue, is limited to an aggregate principal amount of not more than US$130 million  and shall be designated as “5.75% Series C Convertible Unsecured Subordinated Debentures due June 30, 2019”.

 

(b)                                 The Series C Debentures shall be dated as of the date hereof and shall mature on the Maturity Date.  The Series C Debentures shall bear interest from the date of issue at the rate of 5.75% per annum, payable semi-annually in arrears on the last day of June and December in each year (each, an “Interest Payment Date”) computed on the basis of a 360-day year composed of twelve 30-day months.  The first such payment will fall due on  December 31, 2012 and the last such

 

4

 

payment (representing interest payable from and including the last Interest Payment Date to, but excluding, the Maturity Date or the earlier date of redemption or conversion of the Series C Debentures) will fall due on the Maturity Date or the earlier date of redemption or conversion, payable after as well as before maturity and after as well as before default, with interest on amounts in default at the same rate, compounded semi-annually,  computed on the basis of a 360-day year composed of twelve 30-day months.  For certainty, the first interest payment will include interest accrued and unpaid from and including July 5, 2012 up to, but excluding, December 31, 2012, which will be equal to US$28.1111 for each US$1,000 principal amount of the Series C Debentures (or US$3,654,444 on a total principal amount of US$130 million).

 

(c)                                        The Series C Debentures will be redeemable at the option of the Company in accordance with the terms of Article 4 of the Trust Indenture, provided that the Series C Debentures will not be redeemable prior to June 30, 2015 (except in certain limited circumstances following a Change of Control as defined in the Trust Indenture).  On or after June 30, 2015 and prior to June 30, 2017, the Series C Debentures may be redeemed by the Company, in whole at any time or in part from time to time, on notice as provided for in Section 4.3 of the Trust Indenture, provided that the Current Market Price is not less than 125% of the Conversion Price at the time notice of redemption is given. On or after June 30, 2017 and prior to the Maturity Date, the Series C Debentures may be redeemed by the Company, in whole or in part from time to time, on notice as provided for in Section 4.3 of the Trust Indenture. In such circumstances, the Series C Debentures will be redeemable at a price equal to their principal amount plus accrued and unpaid interest.  The Redemption Notice for the Series C Debentures shall be substantially in the form of Schedule “B”.  In connection with the redemption of the Series C Debentures, the Company may, at its option and subject to the provisions of Section 4.6 of the Trust Indenture and subject to regulatory approval, elect to satisfy its obligation to pay all or a portion of the aggregate Redemption Price of the Series C Debentures to be redeemed by issuing and delivering to the holders of such Series C Debentures, such number of Freely Tradeable Common Shares as is obtained by dividing the principal amount of the Series C Debentures which are to be redeemed by 95% of the Current Market Price on the Redemption Date. If the Corporation elects to exercise such option, it shall so specify and provide details in the Redemption Notice.

 

(d)                                 The Series C Debentures will be subordinated to the Senior Indebtedness in accordance with the provisions of Article 5 of the Trust Indenture.  In accordance with Section 2.12 of the Trust Indenture, the Series C Debentures and each other series of Debentures issued under the Trust Indenture or under indentures supplemental to the Trust Indenture, will rank pari passu with each other (regardless of their actual date or terms of issue) and, except as prescribed by law, with all other present and future subordinated indebtedness and unsecured indebtedness of the Company, other than Senior Indebtedness.

 

(e)                                  Upon and subject to the provisions and conditions of Article 6 of the Trust Indenture, the holder of each Series C Debenture shall have the right, at such

 

5

 

holder’s option, at any time prior to the close of business on the earlier of: (i) the Maturity Date; and (ii) the last Business Day immediately preceding the Redemption Date specified by the Company for redemption of the Series C Debentures by notice to the holders of Series C Debentures in accordance with Section 2.1(c) of this Supplemental Indenture and Section 4.3 of the Trust Indenture (the earlier of which will be the “Time of Expiry” for the purposes of Article 6 of the Trust Indenture in respect of the Series C Debentures), to convert the whole or, in the case of a Debenture of a denomination in excess of US$1,000, any part which is US$1,000 or an integral multiple thereof, of the principal amount of such Debenture into Common Shares at the Conversion Price in effect on the Date of Conversion.  To the extent a redemption is a redemption in part only of the Series C Debentures, such right to convert, if not exercised prior to the applicable Time of Expiry, shall survive as to any Series C Debentures not redeemed or converted and be applicable to the next succeeding Time of Expiry.

 

(f)                                   The Conversion Price in effect on the date hereof for each Common Share to be issued upon the conversion of Series C Debentures shall be equal to US$17.25 per Common Share being a conversion ratio of approximately 57.9710 Common Shares for each US$1,000 principal amount of Series C Debentures so converted. No adjustment to the Conversion Price will be made for dividends or distributions payable on Common Shares issuable upon conversion or for interest accrued or accruing on Series C Debentures surrendered for conversion.  Holders converting their Series C Debentures will receive interest which has accrued but not been paid from the date of the most recent Interest Payment Date on which interest was paid in full in accordance with this Supplemental Indenture to, but not including, the Date of Conversion. The Conversion Price applicable to, and the Common Shares, securities or other property receivable on the conversion of, the Series C Debentures is subject to adjustment pursuant to the provisions of paragraphs (a), (b), (c), (d) and (g) of Section 6.5 of the Trust Indenture and, in addition, from time to time, as set forth below:

 

(i)              If any issuer bid (other than a normal course issuer bid made through the facilities of the TSX or the NYSE) made by the Company or any of its Subsidiaries for all or any portion of Common Shares shall expire, then, if the issuer bid shall require the payment to shareholders of consideration per Common Share having a fair market value (determined as provided below) that exceeds the Current Market Price per Common Share on the last date (the “Expiration Date”) tenders could have been made pursuant to such issuer bid (as it may be amended) (the last time at which such tenders could have been made on the Expiration Date is hereinafter sometimes called the “Expiration Time”), the Conversion Price in respect of the Series C Debentures shall be adjusted so that the same shall equal the rate determined by multiplying the Conversion Price in effect immediately preceding the close of business on the Expiration Date by a fraction of which (A) the denominator shall be the sum of (I) the fair market value of the aggregate consideration (the fair market value as determined by the Directors, subject to TSX or NYSE approval, if

 

6

 

applicable, which determination shall be conclusive) payable to shareholders based on the acceptance (up to any maximum specified in the terms of the issuer bid) of all Common Shares validly tendered and not withdrawn as of the Expiration Time (the Common Shares deemed so accepted, up to any such maximum, being referred to as the “Purchased Common Shares”), and (II) the product of the number of Common Shares outstanding (less any Purchased Common Shares and excluding any Common Shares held in the treasury of the Company) at the Expiration Time and the Current Market Price per Common Share on the Expiration Date; and (B) the numerator of which shall be the product of the number of Common Shares outstanding (including Purchased Common Shares but excluding any Common Shares held in the treasury of the Company) at the Expiration Time multiplied by the Current Market Price per Common Share on the Expiration Date, such increase to be effective immediately preceding the opening of business on the day following the Expiration Date.  In the event that the Company is obligated to purchase Common Shares pursuant to any such issuer bid, but the Company is permanently prevented by applicable law from effecting any or all such purchases or any or all such purchases are rescinded, the Conversion Price shall again be adjusted to be the Conversion Price which would have been in effect based upon the number of Common Shares actually purchased, if any.  If the application of this clause (i) of Section 2.1(f) to any issuer bid would result in a decrease in the Conversion Price, no adjustment shall be made for such issuer bid under this clause (i).

 

For purposes of this Section 2.1(f), the term “issuer bid” shall mean an issuer bid (other than an issuer bid which is exempt from the requirements of Part 2 of MI 62-104) under Applicable Securities Legislation or a take-over bid (other than a take-over bid which is exempt from the requirements of Part 2 of MI 62-104) under Applicable Securities Legislation by a Subsidiary of the Company for the Common Shares and all references to “purchases” of Common Shares in issuer bids (and all similar references) shall mean and include the purchase of Common Shares in issuer bids and all references to “tendered Common Shares” (and all similar references) shall mean and include Common Shares tendered in issuer bids.

 

(ii)           If and whenever at any time prior to the Time of Expiry the Company shall fix a record date for the payment of a regular cash dividend or distribution to the holders of all or substantially all of the outstanding Common Shares in respect of any Applicable Period that exceeds the Initial Dividend Threshold, the Conversion Price in respect of the Series C Debentures shall be adjusted immediately after such record date so that it shall be equal to the price determined by multiplying the Conversion Price in effect on such record date by a fraction, of which the denominator shall be the Current Market Price per Common Share on such record date and of which the numerator shall be the Current Market Price per Common

 

7

 

Share on such record date minus the amount in cash per Common Share distributed to holders of Common Shares in excess of the Initial Dividend Threshold.  Such adjustment shall be made successively whenever such a record date is fixed.  To the extent that any such cash dividend or distribution is not paid, the Conversion Price shall be re-adjusted to the Conversion Price which would then be in effect if such record had not been fixed.

 

The Initial Dividend Threshold will be adjusted in the same manner as the Conversion Price set forth under this Section 2.1(f), provided that no adjustment will be made to the Initial Dividend Threshold for any adjustment made to the Conversion Price under clause (ii) of this Section 2.1(f).

 

(iii)            In any case in which this Section 2.1(f) shall require that an adjustment shall become effective immediately after a record date for an event referred to herein, the Company may defer, until the occurrence of such event, issuing to the holder of any Series C Debenture converted after such record date and before the occurrence of such event the additional Common Shares or other securities or property issuable upon such conversion by reason of the adjustment required by such event before giving effect to such adjustment; provided, however, that the Company shall deliver to such holder an appropriate instrument evidencing such holder’s right to receive such additional Common Shares or other securities or property upon the occurrence of the event requiring such adjustment and the right to receive any distributions made on such additional Common Shares or other securities or property declared in favour of holders of record of Common Shares on and after the Date of Conversion or such later date as such holder would, but for the provisions of this Section 2.1(f), have become the holder of record of such additional Common Shares pursuant to Section 6.4(b) of the Trust Indenture.

 

(iv)            The adjustments provided for in this Section 2.1(f) are cumulative and shall apply to successive subdivisions, redivisions, reductions, combinations, consolidations, dividends, distributions, issues or other events resulting in any adjustment under the provisions of this Section 2.1(f), provided that, notwithstanding any other provision of this Section 2.1(f), no adjustment of the Conversion Price shall be required unless such adjustment would require an increase or decrease of at least 1% in the Conversion Price then in effect; provided however, that any adjustments which by reason of this Section 2.1(f) are not required to be made shall be carried forward and taken into account in any subsequent adjustment.

 

(v)             In the event of any question arising with respect to the adjustments provided in this Section 2.1(f), such question shall be conclusively determined by a firm of chartered accountants appointed by the Company and acceptable to the Debenture Trustee (who may be the auditors of the Company); such accountants shall have access to all necessary records of

 

8

 

the Company and such determination shall be binding upon the Company, the Debenture Trustee, and the holders of Series C Debentures.

 

(vi)                              In case the Company shall take any action, or any event shall occur, affecting the Common Shares other than action described in this Section  2.1(f), which in the opinion of the Directors, would materially affect the rights of Debentureholders, the Conversion Price and the Common Shares or other securities or property issuable or deliverable upon a conversion of Debentures, as applicable, shall be adjusted in such manner and at such time, by action of the Directors, subject to, as required, the prior written consent of the TSX (or, if the Debentures are not listed thereon, such other exchange on which the Debentures are then listed), as the Directors, in their sole discretion may determine to be equitable in the circumstances.  Failure of the Directors to make such an adjustment shall be conclusive evidence that they have determined that it is equitable to make no adjustment in the circumstances.

 

(vii)                           Subject to, as required, the prior written consent of the TSX (or, if the Series C Debentures are not listed thereon, such other exchange on which the Series C Debentures are then listed), no adjustment in the Conversion Price shall be made in respect of any event described in paragraphs (a), (b) and (c) of Section 6.5 of the Trust Indenture or clauses (i) and (ii) of this Section 2.1(f), other than the events described in clauses (i) and (ii) of Section 6.5(a) of the Trust Indenture, if the holders of the Series C Debentures are entitled to participate in such event on the same terms mutatis mutandis as though and with the same effect as if they had converted their Series C Debentures prior to the effective date or record date, as the case may be, of such event.

 

(viii)                        Except as stated above in this Section 2.1(f), no adjustment will be made in the Conversion Price for any Series C Debentures as a result of the issuance of Common Shares at less than the Current Market Price for such Common Shares on the date of issuance.

 

(g)                                                          The Series C Debentures shall be issued in denominations of US$1,000 and integral multiples of US$1,000 and the Debenture Trustee is hereby appointed as registrar and transfer agent for the Series C Debentures.  Each Series C Debenture and the certificate of the Debenture Trustee endorsed thereon shall be issued in substantially the form set out in Schedule “A”, with such insertions, omissions, substitutions or other variations as shall be required or permitted by the Trust Indenture and this Supplemental Indenture, and may have imprinted or otherwise reproduced thereon such legend or legends or endorsements, not inconsistent with the provisions of the Trust Indenture and this Supplemental Indenture, as may be required to comply with any law or with any rules or regulations pursuant thereto or with any rules or regulations of any securities exchange or securities regulatory authority or to conform with general usage, all as may be determined by the Directors or an Authorized Officer executing such Series C Debenture in accordance with Section 2.7 of the Trust Indenture, as conclusively evidenced by

 

9

 

his or her execution of a Series C Debenture.  Each Series C Debenture shall additionally bear such distinguishing letters and numbers as the Debenture Trustee shall approve.  Notwithstanding the foregoing, a Series C Debenture may be in such other form or forms as may, from time to time, be approved by a resolution of the Directors or as specified in a Certificate.  The Series C  Debentures may be engraved, lithographed, printed, mimeographed or typewritten or partly in one form and partly in another.

 

The Series C Debentures shall be issued as one or more Global Debentures and the Global Debentures will be registered in the name of the Depository which, as of the date hereof, shall be CDS (or any nominee of the Depository).  No Beneficial Holder will receive definitive certificates representing its interest in Debentures except as provided in Section 3.2 of the Trust Indenture.  A Global Debenture may be exchanged for Debentures in registered form that are not Global Debentures, or transferred to and registered in the name of a Person other than the Depository for such Global Debentures or a nominee thereof as provided in Section 3.2 of the Trust Indenture.

 

(h)                                                         Upon and subject to the provisions and conditions of Article 10 of the Trust Indenture, and provided no Event of Default has occurred and is continuing, the Company may elect, from time to time, to raise funds to satisfy all or part of an Interest Obligation on the Series C Debentures on any Interest Payment Date (including, for greater certainty, following conversion or upon maturity or redemption) by delivering Common Shares to an agent, including the Debenture Trustee, for sale through the facilities of a registered broker/dealer.

 

(i)                                                             Subject to Applicable Securities Legislation and any required regulatory approval, upon the occurrence of a Change of Control and subject to the provisions and conditions of this Section 2.1(i) and Article 5 of the Trust Indenture, Debentureholders have a right to require the Company to purchase all of their Series C Debentures.  The terms and conditions of such right are set forth below.

 

(i)                                     Upon the occurrence of a Change of Control, each holder of Series C Debentures shall have the right (the “Put Right”) to require the Company to purchase, on the date (the “Put Date”) which is 30 days following the date upon which the Debenture Trustee delivers a Change of Control Notice (as defined below) to the holders of Series C Debentures, all or any part of such holder’s Series C Debentures at a price equal to 100% of the principal amount thereof (the “Put Price”) plus accrued and unpaid interest, if any, on such Series C Debenture up to, but excluding, the Put Date (collectively, the “Total Put Price”).

 

(ii)                                  The Company will, as soon as practicable, and in any event no later than two Business Days after the occurrence of a Change of Control, give written notice to the Debenture Trustee of the Change of Control.  The Debenture Trustee will, as soon as practicable thereafter, and in any event no later than four Business Days after receiving notice from the Company of the Change of Control, provide written notice to the holders of Series C

 

10

 

Debentures of the Change of Control (a “Change of Control Notice”).  The Change of Control Notice shall include a description of the Change of Control, details of the Debentureholders’ Put Right under the terms of the Trust Indenture and the Supplemental Indenture (including identifying the Put Date), a statement that each holder will be entitled to withdraw his  election to require the Company to purchase if the Debenture Trustee receives, no later than the close of business on the third Business Day immediately preceding the Put Date, a facsimile transmission or letter setting forth the name of such holder, the principal amount of the Series C Debentures tendered for purchase and a statement that such holder is withdrawing his election to have the Series C Debentures purchased and a description of the rights of the Company to redeem untendered Series C Debentures in accordance with Section 2.1(i)(iv) hereof.

 

(iii)                               To exercise the Put Right the Debentureholder must deliver to the Debenture Trustee, not less than five Business Days prior to the Put Date, written notice of the holder’s exercise of such right in the form attached as Schedule “E”.

 

(iv)                              If 90% or more in aggregate principal amount of Series C Debentures outstanding on the date the Company provides notice of a Change of Control to the Debenture Trustee have been tendered for purchase pursuant to the Put Right on the Put Date, the Company shall have the right, upon written notice provided to the Debenture Trustee within 10 days following the Put Date, to redeem all the remaining outstanding Series C Debentures effective as of the Put Date at the Total Put Price (the “90% Redemption Right”).

 

(v)                                 Upon receipt of notice that the Company shall exercise the 90% Redemption Right and acquire the remaining Series C Debentures, the Debenture Trustee shall as soon as reasonably practicable provide written notice to all Debentureholders that did not previously exercise the Put Right that:

 

(A)                               the Company has exercised the 90% Redemption Right and will purchase all outstanding Series C Debentures effective as of the Put Date at the Total Put Price, including a calculation of such holder’s Total Put Price;

 

(B)                               each holder must transfer their Series C Debentures to the Debenture Trustee on the same terms as those holders that exercised the Put Right and must send their respective Series C Debentures, duly endorsed for transfer, to the Debenture Trustee within 10 days after the sending of such notice and the Depository shall make notations on the Global Debenture of the principal amount thereof so transferred; and

 

(C)                               the rights of such holder under the terms of the Series C Debentures, the Trust Indenture and this Supplemental Indenture shall cease to be effective as of the Put Date provided the Company has paid the Total Put Price to, or to the order of, the

 

11

 

Debenture Trustee and thereafter the Series C Debentures shall not be considered to be outstanding and the holder shall not have any right except to receive such holder’s Total Put Price upon surrender and delivery of such holder’s Series C Debentures in  accordance with the Trust Indenture and this Supplemental Indenture.

 

(vi)                              The Company shall, on or before 11:00 a.m. (Toronto time) on the Business Day immediately prior to the Put Date, deposit with the Debenture Trustee or any paying agent to the order of the Debenture Trustee, such sums of money as may be sufficient to pay the Total Put Price of the Series C Debentures to be purchased or redeemed by the Company on the Put Date, provided the Company may elect to satisfy this requirement by providing the Debenture Trustee with a certified cheque or wire transfer for such amounts required under this Section 2.1(i)(vi).  The Company shall also deposit with the Debenture Trustee a sum of money sufficient to pay any charges or expenses that may be incurred by the Debenture Trustee in connection with such purchase and/or redemption, as the case may be.  Every such deposit shall be irrevocable.  From the sums so deposited, the Debenture Trustee shall pay or cause to be paid to the holders of such Series C Debentures, the Total Put Price to which they are entitled (less any tax required by law to be deducted in respect of accrued and unpaid interest) on the Company’s purchase or redemption.

 

(vii)                           In the event that one or more of such Series C Debentures being purchased in accordance with this Section 2.1(i) becomes subject to purchase in part only, upon surrender of such Series C Debentures for payment of the Total Put Price, the Depository shall make notations on the Global Debenture of the principal amount thereof so purchased.

 

(viii)                        Series C Debentures for which holders have exercised the Put Right and Series C Debentures which the Company has elected to redeem in accordance with the 90% Redemption Right shall become due and payable at the Total Put Price on the Put Date, in the same manner and with the same effect as if it were the date of maturity specified in such Series C Debentures, anything therein or herein to the contrary notwithstanding, and from and after such Put Date, if the money necessary to purchase or redeem the Series C Debentures shall have been deposited as provided in this Section 2.1(i) and affidavits or other proofs satisfactory to the Debenture Trustee as to the publication and/or mailing of such notices shall have been lodged with it, interest on the Series C Debentures shall cease.  If any question shall arise as to whether any notice has been given as above provided and such deposit made, such question shall be decided by the Debenture Trustee whose decision shall be final and binding upon all parties in interest.

 

(ix)                              In case the holder of any Series C Debenture to be purchased or redeemed in accordance with this Section 2.1(i) shall fail on or before the Put Date to surrender such holder’s Series C Debenture or shall not within such

 

12

 

time accept payment of the money payable; or give such receipt therefor, if any, as the Debenture Trustee may require, such monies may be set aside in trust, either in the deposit department of the Debenture Trustee or in a chartered bank, and such setting aside shall for all purposes be  deemed a payment to the Debentureholder of the sum so set aside and, to that extent, the Series C Debenture shall thereafter not be considered as outstanding hereunder and the Debentureholder shall have no other right except to receive payment of the monies so paid and deposited, upon surrender and delivery up of such holder’s Series C Debenture, of the Total Put Price.  In the event that any money required to be deposited hereunder with the Debenture Trustee or any depository or paying agent on account of the Total Put Price shall remain so deposited for a period of six years from the Put Date, then such monies shall at the end of such period be paid over or delivered over by the Debenture Trustee or such depository or paying agent to the Company and the Debenture Trustee shall not be responsible to Debentureholders for any amounts owing to them.

 

(x)                                 Subject to the provisions above related to Series C Debentures purchased in part, all Series C Debentures redeemed and paid under this Section 2.1(i) shall forthwith be delivered to the Debenture Trustee and cancelled and no Series C Debentures shall be issued in substitution therefor.

 

(j)                                                            In addition to the requirements of Section 2.1(i) in respect of a Change of Control, the following provisions shall apply in respect of the occurrence of a Cash Change of Control:

 

(i)                                     In the event of the occurrence of a Cash Change of Control, then subject to regulatory approval, during the period (the “Cash Change of Control Conversion Period”) beginning 10 trading days before the anticipated effective date of the Change of Control (the “Effective Date”) and ending on the date that is 30 days after the Change of Control Notice and Change of Control Purchase Offer are delivered or mailed to holders of Series C  Debentures in accordance with Section 2.1(i), holders of Series C Debentures will be entitled to convert their Series C Debentures, in whole or in part, and receive, in addition to the number of Common Shares (or cash or other property or securities in substitution therefor) that such holders are entitled to receive upon such conversion in accordance with the provisions and conditions of Sections 2.1(e) and 2.1(i) of this Second Supplemental Indenture and Article 6 of the Trust Indenture, an additional number of Common Shares (or cash or other property or securities in substitution therefor) per US$1,000 principal amount of Series C Debentures converted as set forth below (the “Make Whole Premium”).

 

(ii)                                  The number of additional Common Shares (or cash or other property or securities in substitution therefor) per US$1,000 principal amount of Series C Debentures constituting the Make Whole Premium (the “Make 

 

13

 

Whole Premium Shares”) shall be determined by reference to the table following subsection (iii) below, based on the actual Effective Date and the price (the “Stock Price”) paid per Common Share in the transaction constituting the Change of Control. If holders of Common Shares receive  only cash in the transaction constituting the Change of Control, the Stock Price shall be the cash amount paid per Common Share. Otherwise, the Stock Price shall be equal to the Current Market Price of the Common Shares immediately preceding the actual Effective Date of such transaction. Notwithstanding the foregoing, in no circumstances can the effective Conversion Price (calculated by dividing US$1,000 by the number of Common Shares issuable upon conversion, including the maximum number of Make Whole Premium Shares hereunder) be less than the maximum permitted discounted price permitted by the TSX at the time of announcement of the 2012 Offering (estimated by the Company to be US$10.33), prior to any adjustments that may be made to the Stock Price to correspond to an adjustment to the Conversion Price under the Trust Indenture or this Second Supplemental Indenture.

 

(iii)                               The following table shows the number of Make Whole Premium Shares for each hypothetical Stock Price and Effective Date set forth below, expressed as additional Common Shares per US$1,000 principal amount of the Series C Debentures. For the avoidance of doubt, the Company shall not be obliged to pay the Make Whole Premium otherwise than by issuance of Common Shares (or cash or other property or securities in substitution therefor) upon conversion of the Series C Debentures in accordance with the provisions and conditions of Section 2.1(e) of this Second Supplemental Indenture and Article 6 of the Trust Indenture. If the Stock Price or Effective Date are not set forth on the table then: (i) if the actual Stock Price on the Effective Date is between two Stock Prices on the table or the Effective Date is between two Effective Dates on the table, the number of Make Whole Premium Shares will be determined by a straight-line interpolation between the amounts set forth for the two Stock Prices and the two Effective Dates on the table based on a 365-day year, as applicable, (ii) if the Stock Price on the Effective Date exceeds US$35.00 per Common Share, subject to adjustment as set forth herein, the number of Make Whole Premium Shares to be issued will be zero, and (iii) if the Stock Price on the Effective Date is less than US$12.76 per Common Share, subject to adjustment as set forth herein, the number of Make Whole Premium Shares to be issued will be zero.

 

Make Whole Premium Upon a Cash Change of Control
 (Number of Additional Common Shares per US$1,000 Series C Debenture)

 

	
Effective
    	
 
    	
Stock Price (US$)
    	
 
    
	
Date
    	
 
    	
12.76
    	
 
    	
14.00
    	
 
    	
$15.00
    	
 
    	
$16.00
    	
 
    	
$17.00
    	
 
    	
$18.00
    	
 
    	
$19.00
    	
 
    	
$20.00
    	
 
    	
$25.00
    	
 
    	
$30.00
    	
 
    	
$35.00
    	
 
    
	
July 5, 2012
    	
 
    	
20.3989
    	
 
    	
14.4182
    	
 
    	
10.7751
    	
 
    	
7.9386
    	
 
    	
5.7832
    	
 
    	
4.1625
    	
 
    	
2.9440
    	
 
    	
2.0649
    	
 
    	
0.2683
    	
 
    	
0.0181
    	
 
    	
0.0023
    	
 
    

 

14

 

	
Effective
    	
 
    	
Stock Price (US$)
    	
 
    
	
Date
    	
 
    	
12.76
    	
 
    	
14.00
    	
 
    	
$15.00
    	
 
    	
$16.00
    	
 
    	
$17.00
    	
 
    	
$18.00
    	
 
    	
$19.00
    	
 
    	
$20.00
    	
 
    	
$25.00
    	
 
    	
$30.00
    	
 
    	
$35.00
    	
 
    
	
June 30, 2013
    	
 
    	
20.3989
    	
 
    	
14.1969
    	
 
    	
10.4853
    	
 
    	
7.5954
    	
 
    	
5.4128
    	
 
    	
3.7865
    	
 
    	
2.5750
    	
 
    	
1.7241
    	
 
    	
0.1358
    	
 
    	
0.0042
    	
 
    	
0.0004
    	
 
    
	
June 30, 2014
    	
 
    	
20.3989
    	
 
    	
13.9234
    	
 
    	
10.1084
    	
 
    	
7.1339
    	
 
    	
4.9013
    	
 
    	
3.2540
    	
 
    	
2.0374
    	
 
    	
1.2198
    	
 
    	
0.0155
    	
 
    	
—
    	
 
    	
—
    	
 
    
	
June 30, 2015
    	
 
    	
20.3989
    	
 
    	
13.6549
    	
 
    	
9.7145
    	
 
    	
6.6473
    	
 
    	
4.3740
    	
 
    	
2.7116
    	
 
    	
1.4655
    	
 
    	
0.6581
    	
 
    	
—
    	
 
    	
—
    	
 
    	
—
    	
 
    
	
June 30, 2016
    	
 
    	
20.3989
    	
 
    	
13.2441
    	
 
    	
8.9819
    	
 
    	
5.6393
    	
 
    	
3.2506
    	
 
    	
1.6512
    	
 
    	
0.6486
    	
 
    	
0.1769
    	
 
    	
—
    	
 
    	
—
    	
 
    	
—
    	
 
    
	
June 29, 2017
    	
 
    	
20.3989
    	
 
    	
13.1448
    	
 
    	
8.4957
    	
 
    	
4.4653
    	
 
    	
1.4383
    	
 
    	
0.1904
    	
 
    	
0.0083
    	
 
    	
—
    	
 
    	
—
    	
 
    	
—
    	
 
    	
—
    	
 
    

 

(iv)                              The Stock Prices set forth in the first row of table above will be adjusted as of any date on which the Conversion Price of the Series C Debentures is adjusted. The adjusted Stock Prices will equal the Stock Prices applicable immediately preceding such adjustment multiplied by a fraction, the denominator of which is the Conversion Price immediately preceding the adjustment giving rise to the Stock Price adjustment and the numerator of which is the Conversion Price as so adjusted. The number of additional Make Whole Premium Shares set forth in the table above will be adjusted in the same manner as the number of Conversion Shares issuable upon an adjustment of the Conversion Price as set forth in Section 2.1(f) of this Supplemental Indenture, other than as a result of an adjustment of the Conversion Price by adding the Make Whole Premium as described above.

 

(v)                                 Notwithstanding the foregoing, if the Date of Conversion of any Series C Debentures occurs during the period beginning on the 10th trading day prior to the Effective Date and ending at the close of business on the actual Effective Date, the holders of such Series C Debentures shall, on conversion of their Series C Debentures, only be entitled to receive that number of Make Whole Premium Shares (as may be adjusted pursuant to Section 2.1(f) of this Supplemental Indenture) on the Business Day immediately following the actual Effective Date and, for greater certainty, only if the Change of Control occurs.

 

(vi)                              The Make Whole Premium Shares shall be deemed to have been issued to a holder of Series C Debentures who exercises conversion rights on or prior to the Effective Date upon conversion of Series C Debentures on the Business Day immediately following the Effective Date. Section 2.1(f) of this Supplemental Indenture shall apply to such conversion and, for greater certainty, the former holders of Series C Debentures in respect of which the Make Whole Premium Shares are issuable shall be entitled to receive and shall accept, in lieu of the Make Whole Premium Shares, the number of shares or other securities or cash or other property of the Company or of the Person or other entity resulting from the transaction that constitutes the Cash Change of Control that such holders would have

 

15

 

been entitled to receive if such holders had been the registered holders of the applicable number of Make Whole Premium Shares on the Effective Date.

 

(vii)                           Except as otherwise provided in Section 2.1(i), all other provisions of this Second Supplemental Indenture and the Trust Indenture applicable to a conversion of Series C Debentures shall apply to a conversion of Series C Debentures during the Cash Change of Control Conversion Period.

 

(k)                                                         The Debenture Trustee shall be provided with the documents and instruments referred to in Sections 2.5(b), (c) and (d) of the Trust Indenture with respect to the Series C Debentures prior to the issuance of the Series C Debentures.

 

2.2                               Delivery

 

The Series C Debentures shall be executed by the Company and delivered to the Debenture Trustee accompanied by the documentation contemplated in Section 2.5 of the Trust Indenture.

 

2.3                               Legends and Certification

 

The Series C Debentures shall contain the legend as set out in Schedule “A” and the Debenture Trustee’s certificate of authentication shall be in the form annexed to that Schedule “A”.

 

ARTICLE 3
 CONFIRMATION OF TRUST INDENTURE

 

3.1                               Confirmation of Trust Indenture

 

The Trust Indenture, as supplemented by the First Supplemental Indenture, and as further supplemented by this Second Supplemental Indenture, shall be and continue in full force and effect and is hereby confirmed.

 

ARTICLE 4
 ACCEPTANCE OF TRUST BY DEBENTURE TRUSTEE

 

4.1                               Acceptance of Trust

 

The Debenture Trustee hereby accepts the trusts in this Supplemental Indenture and in the Trust Indenture declared and provided for and agrees to perform the same upon the terms and conditions herein set forth and to hold all rights, privileges and benefits conferred hereby and by law in trust for the various persons who shall from time to time be Debentureholders, subject to all the terms and conditions herein set forth.

 

16

 

ARTICLE 5
 EXECUTION AND FORMAL DATE

 

5.1                               Execution

 

This Second Supplemental Indenture may be simultaneously executed in several counterparts, each of which when so executed shall be deemed to be an original and such counterparts together shall constitute one and the same instrument.

 

5.2                               Formal Date

 

For the purpose of convenience this Second Supplemental Indenture may be referred to as bearing the formal date of  July 5, 2012 irrespective of the actual date of execution hereof.

 

[Remainder of page intentionally left blank.  Signature page follows.]

 

17

 

IN WITNESS WHEREOF the parties hereto have executed this Second Supplemental Indenture by the hands of their proper officers.

 

	
 
    	
ATLANTIC POWER CORPORATION
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Barry Welch
    
	
 
    	
 
    	
Name:
    	
Barry Welch
    
	
 
    	
 
    	
Title:
    	
Chief Executive Officer and President
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
COMPUTERSHARE TRUST COMPANY OF   CANADA
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Soheil Kafai
    
	
 
    	
 
    	
Name: 
    	
Soheil Kafai
    
	
 
    	
 
    	
Title:
    	
Corporate Trust Officer
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Lisa M. Kudo
    
	
 
    	
 
    	
Name:
    	
Lisa M. Kudo
    
	
 
    	
 
    	
Title:
    	
Corporate Trust Officer
    

 

 

SCHEDULE “A”

 

TO THE SECOND SUPPLEMENTAL INDENTURE 
 TO THE TRUST INDENTURE DATED DECEMBER 17, 2009 BETWEEN

 

ATLANTIC POWER CORPORATION

 

- and -

 

COMPUTERSHARE TRUST COMPANY OF CANADA

 

Form of Debenture

 

 

SCHEDULE “A”

 

FORM OF GLOBAL DEBENTURE

 

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF CDS CLEARING AND DEPOSITORY SERVICES INC. (“CDS”) TO ATLANTIC POWER CORPORATION (THE “ISSUER”) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IN RESPECT THEREOF IS REGISTERED IN THE NAME OF CDS & CO., OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF CDS (AND ANY PAYMENT IS MADE TO CDS & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF CDS), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED HOLDER HEREOF, CDS & CO., HAS A PROPERTY INTEREST IN THE SECURITIES REPRESENTED BY THIS CERTIFICATE HEREIN AND IT IS A VIOLATION OF ITS RIGHTS FOR ANOTHER PERSON TO HOLD, TRANSFER OR DEAL WITH THIS CERTIFICATE.

 

Certificate No. ·

 

	
CUSIP No.
    	
04878QAQ6
    	
US$130,000,000.00
    
	
ISIN No.
    	
CA04878QAQ60
    	
 
    

 

ATLANTIC POWER CORPORATION
 (A corporation continued under and governed by the laws of the Province of British Columbia)

 

5.75% SERIES C CONVERTIBLE UNSECURED SUBORDINATED DEBENTURE
 DUE JUNE 30, 2019 (“Series C Debenture”)

 

ATLANTIC POWER CORPORATION (the  “Company”) for value received hereby acknowledges itself indebted and, subject to the provisions of the trust indenture (the “Indenture”) dated as of December 17, 2009 between the Company and Computershare Trust Company of Canada (the “Debenture Trustee”), as supplemented by the second supplemental indenture dated as of July 5, 2012 between the Company and the Debenture Trustee (the “Supplemental Indenture”), promises to pay to the registered holder hereof on June 30, 2019 (the “Maturity Date”) or on such earlier date as the principal amount hereof may become due in accordance with the provisions of the Indenture and the Supplemental Indenture the principal sum of one hundred thirty million dollars in lawful money of the United States of America (US$130,000,000) on presentation and surrender of this Series C Debenture at the principal offices of the Debenture Trustee in Toronto, Ontario in accordance with the terms of the Indenture and the Supplemental Indenture and, subject as hereinafter provided, to pay interest on the principal amount hereof from the date hereof, or from the last Interest Payment Date to which interest shall have been paid or made available for payment hereon, whichever is later, at the rate of  5.75% per annum, in like money, in arrears semi-annually (less any withholding tax required or permitted by law to be deducted) on the last day of June and December in each year commencing on December 13, 2012 and the last payment (representing interest payable from the last Interest Payment Date to, but excluding, the Maturity Date or the earlier date of redemption) to fall due on the Maturity Date and, should the Company at any time 

 

 

make default in the payment of any principal, premium or interest, to pay interest on the amount in default at the same rate, in like money and on the same dates.  For certainty, the first interest payment will include interest accrued from July 5, 2012 to, but excluding, December 31, 2012, which will be equal to US$28.1111 for each US$1,000 principal amount of the Series C Debentures.

 

Reference is hereby expressly made to the Indenture and the Supplemental Indenture for a description of the terms and conditions upon which the Series C Debentures are or are to be issued and held and the rights and remedies of the holders of the Series C Debentures and of the Company and of the Debenture Trustee, all to the same effect as if the provisions of the Indenture and the Supplemental Indenture were herein set forth, and to all of which provisions the holder of this Series C Debenture by acceptance hereof assents.  To the extent that the terms and conditions stated in this Series C Debenture conflict with the terms and conditions of the Indenture and the Supplemental Indenture, the Indenture and the Supplemental Indenture shall prevail.  All capitalized terms used herein have the meaning ascribed thereto in the Indenture and the Supplemental Indenture unless otherwise indicated.

 

Interest hereon shall be payable by electronic transfer of funds to the registered holder hereof or such other means provided in the Indenture and the Supplemental Indenture and, subject to the provisions of the Indenture and the Supplemental Indenture, the sending of such electronic transfer of funds shall, to the extent of the sum represented thereby (plus the amount of any tax withheld), satisfy and discharge all liability for interest on this Series C Debenture.

 

This Series C Debenture is one of the Debentures of the Company issued or issuable in one or more series under the provisions of the Indenture.  The Series C Debentures authorized for issue are limited to an aggregate principal amount of one hundred thirty million dollars  in lawful money of the United States of America (US$130,000,000). The Series C Debentures are issuable only in denominations of US$1,000 and integral multiples thereof.  Upon compliance with the provisions of the Indenture and the Supplemental Indenture, Debentures of any denomination may be exchanged for an equal aggregate principal amount of Debentures in any other authorized denomination or denominations.

 

Any part, being US$1,000 or an integral multiple thereof, of the principal of this Series C Debenture, provided that the principal amount of this Series C Debenture is in a denomination in excess of US$1,000, is convertible, at the option of the holder hereof, upon surrender of this Series C Debenture at the principal offices of the Debenture Trustee in the City of Toronto, Ontario, at any time prior to the close of business on the Maturity Date or, if this Series C  Debenture is called for redemption on or prior to such date, then up to but not after the close of business on the last Business Day immediately preceding the date specified for redemption of this Series C Debenture, into Common Shares (without adjustment for interest accrued hereon or for dividends, distributions or interest payments on the Common Shares issuable upon conversion)  at a conversion price of US$17.25 per Common Share (the “Conversion Price”), being a conversion ratio of approximately 57.9710 for each US$1,000 principal amount of Debentures so converted, all subject to the terms and conditions and in the manner set forth in the Indenture and the Supplemental Indenture. The Indenture and the Supplemental Indenture make provision for the adjustment of the Conversion Price in the events therein specified, including the delivery of additional Common Shares (or cash or other property or securities in substitution therefor) for a limited time following a change of control.  No fractional Common Shares will be issued on any conversion but in lieu thereof, the Company will satisfy such fractional interest by a cash payment equal to the market price of such fractional interest determined in accordance with the Indenture.  No adjustment to the Conversion Price will be made for dividends or distributions payable on Common Shares issuable upon 

 

2

 

conversion or for interest accrued or accruing on Series C Debentures surrendered for conversion.  Holders converting their Series C Debentures will receive interest which has accrued and is unpaid in respect thereof from the most recent Interest Payment Date to which interest has been paid to, but not including, the Date of Conversion.

 

This Series C Debenture may be redeemed at the option of the Company on the terms and conditions set out in the Indenture and the Supplemental Indenture at the Redemption Price therein and herein set out provided that this Series C Debenture is not redeemable prior to June 30, 2015. On or after June 30, 2015 and prior to June 30, 2017, this Series C Debenture is redeemable at the option of the Company provided that the Current Market Price is at least 125% of Conversion Price.  On or after June 30, 2017 and prior to the Maturity Date, the Series C Debentures may be redeemed at any time by the Company.  In such circumstances, the Series C Debentures will be redeemable at a price equal to their principal amount plus accrued and unpaid interest.  In connection with the redemption of the Series C Debentures, the Company may, at its option and subject to regulatory approval, elect to satisfy its obligation to pay all or a portion of the aggregate principal amount of the Series C Debentures due upon redemption of the Series C Debentures by issuing and delivering to the holders of such Series C Debentures, such number of Freely Tradeable Common Shares as is obtained by dividing the principal amount of the Series C Debentures which are to be redeemed by 95% of the Current Market Price on the Redemption Date. If the Company elects to exercise such option, it shall so specify and provide details in the Redemption Notice.

 

Upon the occurrence of a Change of Control, each holder of Series C Debentures may subject to the terms and provisions of Section 2.1(h) of the Supplemental Indenture and Article 5 of the Indenture require the Company to purchase the whole or any part of such holder’s Series C Debentures at a price equal to 100% of the principal amount of such Series C Debentures plus accrued and unpaid interest up to, but excluding, the date the Series C Debentures are so repurchased (the “Put Right”).  The Company shall satisfy such purchase price by payment in cash.  If 90% or more of the principal amount of all Series C Debentures outstanding on the date the Company provides notice of a Change of Control to the Debenture Trustee have been tendered for purchase pursuant to the Put Right, the Company has the right to redeem all the remaining outstanding Series C Debentures on the same date and at the same price.

 

If an Offer for outstanding Debentures of a series (other than Debentures held by or on behalf of the Offeror, Associates or Affiliates of the Offeror or anyone acting jointly or in concert with the Offeror) is made and 90% or more of the outstanding principal amount of the Debentures is taken up and paid for by the Offeror, the Offeror wil1 be entitled to acquire the Debentures of those holders who did not accept the offer on the same terms as the Offeror acquired the first 90% of the principal amount of the Debentures.

 

The Company may, on notice as provided in the Indenture and the Supplemental Indenture, at its option and subject to any applicable regulatory approval, elect to satisfy the obligation to repay all or any portion of the principal amount of this Series C Debenture due on the Maturity Date by the issue of that number of Freely Tradeable Common Shares obtained by dividing the principal amount of the outstanding Series C Debentures which have matured by 95% of the Current Market Price on the Maturity Date.

 

The indebtedness evidenced by this Series C Debenture, and by all other Series C Debentures now or hereafter certified and delivered under the Indenture, is a direct unsecured obligation of the Company, and is subordinated in right of payment, to the extent and in the manner provided in the Indenture and the Supplemental Indenture, to the prior payment in full of all Senior 

 

3

 

Indebtedness, whether outstanding at the date of the Supplemental Indenture or thereafter created, incurred, assumed or guaranteed.

 

The principal hereof may become or be declared due and payable before the stated maturity in the events, in the manner, with the effect and at the times provided in the Indenture and the Supplemental Indenture.

 

Any payment of money to any holder of Debentures will be reduced by the amount of applicable withholding taxes, if any.  The Indenture and the Supplemental Indenture contain provisions making binding upon all holders of Debentures outstanding thereunder (or in certain circumstances specific series of Debentures) resolutions passed at meetings of such holders held in accordance with such provisions and instruments signed by the holders of a specified majority of Debentures outstanding (or specific series), which resolutions or instruments may have the effect of amending the terms of this Series C Debenture or the Indenture or the Supplemental Indenture.

 

This Series C Debenture may only be transferred, upon compliance with the conditions prescribed in the Indenture and the Supplemental Indenture, in one of the registers to be kept at the principal offices of the Debenture Trustee in Toronto and in such other place or places and/or by such other registrars (if any) as the Company with the approval of the Debenture Trustee may designate.  No transfer of this Series C Debenture shall be valid unless made on the register by the registered holder hereof and upon compliance with such reasonable requirements as the Debenture Trustee and/or other registrar may prescribe and upon surrender of this Series C Debenture for cancellation.  Thereupon a new Series C Debenture or Series C Debentures in the same aggregate principal amount shall be issued to the transferee in exchange hereof.

 

This Series C Debenture shall not become obligatory for any purpose until it shall have been certified by the Debenture Trustee under the Indenture and the Supplemental Indenture.

 

The Indenture, Supplemental Indenture and this Series C Debenture shall be governed by, and construed in accordance with, the laws of the Province of Ontario and the federal laws of Canada applicable therein.

 

Capitalized words or expressions used in this Series C Debenture shall, unless otherwise defined herein, have the meaning ascribed thereto in the Indenture and the Supplemental Indenture.  In the event that the terms and conditions stated in this Series C Debenture conflict, or are inconsistent, with the terms and conditions of the Indenture and the Supplemental Indenture, the Indenture and Supplemental Indenture, as applicable, shall prevail and take priority.

 

[The remainder of this page has been intentionally left blank.]

 

4

 

IN WITNESS WHEREOF ATLANTIC POWER CORPORATION has caused this Series C Debenture to be signed by its authorized signatories as of the · day of ·, 2012.

 

	
 
    	
ATLANTIC POWER CORPORATION
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Per:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

5

 

(FORM OF DEBENTURE TRUSTEE’S CERTIFICATE)

 

This Series C Debenture is one of the 5.75% Series C Convertible Unsecured Subordinated Debentures due June 30, 2019 referred to in the Indenture and the Supplemental Indenture within mentioned.

 

	
 
    	
COMPUTERSHARE TRUST COMPANY OF CANADA
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    	
 
    
	
 
    	
 
    	
(Authorized Officer)
    	
 
    

 

 

(FORM OF REGISTRATION PANEL)

 

(No writing hereon except by Debenture Trustee or other registrar)

 

	
 
    	
Signature of Debenture Trustee or
    
	
 
    	
Registrar
    
	
 
    	
 
    
	
 
    	
 
    

 

 

CDS & Co.
 85 Richmond Street West
 Toronto, Ontario
 M5H 2C9

 

	
 
    	
Date of Registration:
    	
 
    	
 
    

 

	
 
    	
In Whose Name Registered:   CDS & Co.
    	
 
    

 

 

FORM OF ASSIGNMENT

 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto ·, whose address, if applicable, is set forth below, this Series C Debenture (or US$· principal amount hereof*) of ATLANTIC POWER CORPORATION standing in the name(s) of the undersigned in the register maintained by or on behalf of ATLANTIC POWER CORPORATION with respect to such Series C Debenture and does hereby irrevocably authorize and direct the Debenture Trustee to transfer such Series C Debenture in such register, with full power of substitution in the premises.

 

	
Dated:
    	
 
    	
 
    

 

	
Address of Transferee:
    	
 
    	
 
    
	
 
    	
(Street Address, City, Province and Postal   Code)
    	
 
    

 

(*) If less than the full principal amount of the within Series C Debenture is to be transferred, indicate in the space provided the principal amount (which must be US$1,000 or an integral multiple thereof, unless you hold a Series C Debenture in a non-integral multiple of US$1,000, in which case such Series C Debenture is transferable only in its entirety) to be transferred.

 

	
 
    	
 
    
	
 
    	
Signature of transferring registered holder
    

 

 

EXHIBIT “1”
 TO CDS GLOBAL DEBENTURE
 ATLANTIC POWER CORPORATION

 

5.75% SERIES C CONVERTIBLE UNSECURED SUBORDINATED DEBENTURES DUE JUNE 30, 2019

 

	
Initial Principal Amount:
    	
US$130,000,000
    	
CUSIP No. 04878QAQ6
    
	
 
    	
 
    	
ISIN No. CA04878QAQ60
    

 

 

	
Signature of the Debenture Trustee:
    	
 
    	
 
    

 

ADJUSTMENTS

 

	
Date
    	
 
    	
Amount of
   Increase
    	
 
    	
Amount of
   Decrease
    	
 
    	
New Principal
   Amount
    	
 
    	
Authorization
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

 

SCHEDULE “B”

 

TO THE SECOND SUPPLEMENTAL INDENTURE 
 TO THE TRUST INDENTURE DATED DECEMBER 17, 2009 BETWEEN

 

ATLANTIC POWER CORPORATION

 

- and -

 

COMPUTERSHARE TRUST COMPANY OF CANADA

 

Form of Redemption Notice

 

 

SCHEDULE “B”

 

FORM OF REDEMPTION NOTICE

 

To:                             Holders of 5.75% Series C Convertible Unsecured Subordinated Debentures due June 30, 2019 (the “Debentures”) of Atlantic Power Corporation (the “Company”)

 

Note:                  All capitalized terms used herein have the meaning ascribed thereto in the Indenture and the Supplemental Indenture mentioned below, unless otherwise indicated.

 

Notice is hereby given pursuant to Section 4.3 of the trust indenture (the “Indenture”) dated as of December 17, 2009 between the Company and Computershare Trust Company of Canada (the “Debenture Trustee”), as supplemented by the second supplemental indenture to the Indenture (the “Supplemental Indenture”) dated as of July 5, 2012  between the Company and the Debenture Trustee that the aggregate principal amount of US$· of the US$· of Debentures outstanding will be redeemed as of ·, 20· (the “Redemption Date”), upon payment of a redemption amount of US$· for each US$1,000 principal amount of Debentures, being equal to the aggregate of (i) US$· (the “Redemption Price”), and (ii) accrued and unpaid interest on such redeemed Debentures to but excluding the Redemption Date, in each case less any withholding taxes required to be deducted (collectively, the “Total Redemption Price”).

 

The Total Redemption Price will be payable upon presentation and surrender of the Debentures called for redemption at the following corporate trust office:

 

Computershare Trust Company of Canada
 100 University Ave., 9th Floor
 Toronto, Ontario, M5J 2Y1
 Attention:  Trust Officer, Corporate Trust

 

The interest upon the principal amount of Debentures called for redemption shall cease to be payable from and after the Redemption Date, unless payment of the Redemption Price shall not be made on presentation for surrender of such Debentures at the above-mentioned corporate trust office on or after the Redemption Date or prior to the setting aside of the Redemption Price pursuant to the Indenture and the Supplemental Indenture.

 

 

	
DATED:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
ATLANTIC POWER CORPORATION
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Per:
    	
 
    
	
 
    	
 
    	
 
    	
Name: 
    
	
 
    	
 
    	
 
    	
Title:
    

 

 

SCHEDULE “C”

 

 TO THE SECOND SUPPLEMENTAL INDENTURE 
 TO THE TRUST INDENTURE DATED DECEMBER 17, 2009 BETWEEN

 

ATLANTIC POWER CORPORATION

 

- and -

 

COMPUTERSHARE TRUST COMPANY OF CANADA

 

Form of Maturity Notice

 

 

SCHEDULE “C”

 

FORM OF MATURITY NOTICE

 

	
TO:
    	
Holders of 5.75% Series C Convertible   Unsecured Subordinated Debentures due June 30, 2019 (the “Debentures”) of Atlantic Power Corporation (the “Company”)
    
	
 
    	
 
    
	
AND TO:
    	
Computershare Trust Company of Canada, as   Debenture Trustee
    
	
 
    	
 
    
	
NOTE:
    	
All capitalized terms used herein have the   meaning ascribed thereto in the Indenture and the Supplemental Indenture   mentioned below, unless otherwise indicated.
    

 

Notice is hereby given pursuant to the trust indenture (the “Indenture”) dated as of December 17, 2009 between the Company and Computershare Trust Company of Canada (the “Debenture Trustee”), as supplemented by the second supplemental indenture to the Indenture (the “Supplemental Indenture”) dated as of July 5, 2012  between the Company and the Debenture Trustee that the Debentures are due and payable as of June 30, 2019 (the “Maturity Date”) and the Company hereby advises the holders of Debentures that it will deliver to holders of Debentures a cash payment upon presentation and surrender of the Debentures representing any principal amount and all accrued and unpaid interest to the Maturity Date, to which the holder is entitled.

 

	
DATED:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
ATLANTIC POWER CORPORATION
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Per:
    	
 
    
	
 
    	
 
    	
 
    	
Name: 
    
	
 
    	
 
    	
 
    	
Title:
    

 

 

SCHEDULE “D”

 

 TO THE SECOND SUPPLEMENTAL INDENTURE 
 TO THE TRUST INDENTURE  DATED DECEMBER 17, 2009 BETWEEN

 

ATLANTIC POWER CORPORATION

 

- and -

 

COMPUTERSHARE TRUST COMPANY OF CANADA

 

Form of Notice of Conversion

 

 

SCHEDULE “D”

 

FORM OF NOTICE OF CONVERSION

 

TO:                           ATLANTIC POWER CORPORATION

 

Note:                  All capitalized terms used herein have the meaning ascribed thereto in the Indenture and the Supplemental Indenture mentioned below, unless otherwise indicated.

 

The undersigned registered holder of 5.75% Series C Convertible Unsecured Subordinated Debentures due June 30, 2019 (the “Debentures”) in the principal amount of US$· irrevocably elects to convert such Debentures (or US$· principal amount thereof*) in accordance with the terms of the trust indenture (the “Indenture”) dated as of December 17, 2009 between Atlantic Power Corporation (the “Company”) and Computershare Trust Company of Canada (the “Debenture Trustee”), as supplemented by the second supplemental indenture to the Indenture (the “Supplemental Indenture”)  dated July 5, 2012  between the Company and the Debenture Trustee and tenders herewith the Debentures, and, if applicable, directs that the Common Shares of the Company (or cash or other property or securities in substitution therefor, if applicable) issuable upon a conversion (net of applicable withholding taxes, if any) be issued and delivered to the person indicated below.  (If Common Shares are to be issued in the name of a person other than the holder, all requisite transfer taxes must be tendered by the undersigned.)

 

 

	
Dated:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
(Signature of Registered Holder)
    

 

(*) If less than the full principal amount of the Debentures, indicate in the space provided the principal amount (which must be US$1,000 or integral multiples thereof).

 

(Print name in which Common Shares are to be issued, delivered and registered)

 

	
Name:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(Address)
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
(City, Province and Postal Code)
    	
 
    
	
 
    	
 
    	
 
    
	
Name of guarantor:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Authorized signature:
    	
 
    	
 
    

 

 

SCHEDULE “E”

 

 TO THE SECOND SUPPLEMENTAL INDENTURE 
 TO THE TRUST INDENTURE DATED DECEMBER 17, 2009 BETWEEN

 

ATLANTIC POWER CORPORATION

 

- and -

 

COMPUTERSHARE TRUST COMPANY OF CANADA

 

Form of Notice of Put Exercise

 

 

SCHEDULE “E”

 

FORM OF NOTICE OF PUT EXERCISE

 

(Change of Control)

 

PUT EXERCISE

 

TO:                           ATLANTIC POWER CORPORATION (the “Company”)

 

Note:                  All capitalized terms used herein have the meaning ascribed thereto in the Indenture and the Supplemental Indenture mentioned below, unless otherwise indicated.

 

The undersigned registered holder of 5.75% Series C Convertible Unsecured Subordinated Debentures due June 30, 2019 (the “Debentures”)  in the principal amount of US$· irrevocably elects to put such Debentures (or US$· principal amount thereof*) to the Company to be purchased by the Company on · (the “Put Date”) in accordance with the terms of the trust indenture (the “Indenture”) dated as of December 17, 2009 between the Company and Computershare Trust Company of Canada (the “Debenture Trustee”), as supplemented by the second supplemental indenture (the “Supplemental Indenture”) dated as of July 5, 2012  between the Company and the Debenture Trustee at a price of US$· for each US$1,000 principal amount of Debentures plus all accrued and unpaid interest thereon (net of applicable withholding tax, if any) to, but excluding, the Put Date (collectively, the “Total Put Price”) and tenders herewith the Debentures.

 

 

	
Date:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
(Signature of Registered Holder)
    

 

	
*
    	
If less than the full principal amount of the   Debentures, indicate in the space provided the principal amount (which must   be US$1,000 or integral multiples thereof).
    

 

The total Put Price (after deduction of applicable taxes) will be payable upon presentation and surrender of the Debentures with this form on or after the Put Date at the following corporate trust office:

 

Computershare Trust Company of Canada
 100 University Ave., 9th Floor
 Toronto, Ontario M5J 2Y1

 

The interest upon the principal amount of Debentures put to the Company shall cease to be payable from and after the Put Date unless payment of the Total Put Price shall not be made on presentation for surrender of such Debentures at the above mentioned corporate trust office on or after the Put Date or prior to the setting aside of the Total Put Price pursuant to the Indenture and the Supplemental Indenture.

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