INDENTURE DATED October 9, 2007 BETWEEN EMPRESA DISTRIBUIDORA Y COMERCIALIZADORA NORTE S.A., AS ISSUER AND THE BANK OF NEW YORK, AS TRUSTEE, CO-REGISTRAR AND PAYING AGENT AND BANCO SANTANDER RÍO S.A. AS REGISTRAR, TRANSFER AND PAYING AGENT IN...

 

(d)

concurrently with the delivery of the financial statements referred to in clause (a) above, a certificate of the general manager or chief financial officer of the Company stating whether, to the best of such officer’s knowledge, anything came to his or her attention to cause him or her to believe that there existed on the date of such statements a Default or an Event of Default, and if so, specifying the nature and period of existence thereof.

 

All of the financial statements referred to in (a) and (b) above are to be complete and correct in all material respects, to be prepared in reasonable detail and in accordance with Argentine GAAP applied consistently throughout the periods reflected therein and to be delivered in both the English and Spanish languages.

 

Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such reports shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers’ Certificates).

 

9.7	Notices of Default

 

The Company will use reasonable efforts to notify the Trustee by facsimile or electronic mail (receipt confirmed telephonically or by electronic mail or electronic mail receipt) promptly after it becomes aware of the occurrence of any Event of Default, or any condition or event which with the giving of notice, lapse of time or satisfaction of any other condition or any combination of the foregoing would, unless cured or waived, become an Event of Default. Each notice given pursuant to this paragraph shall be accompanied by a certificate of an Officer of the Company setting forth the details of the occurrence referred to therein and stating what action the Company proposes to take with respect thereto.

 

9.8	Maintenance of Notes Listing

 

The Company will use its reasonable best efforts to obtain and maintain a listing on the Buenos Aires Stock Exchange, the admission to trading on the ▇▇▇▇▇▇▇ Abierto Electrónico S.A., a listing on the Luxembourg Stock Exchange and the admission to trading on the Euro MTF market of the Luxembourg Stock Exchange. In the event that the Notes are admitted to trading on Euro MTF, the Company will use commercially reasonable efforts to maintain such listing; provided that the Company may terminate such listing and delist the Notes from Euro MTF if it determines that the provisions of the European Transparency Obligations Directive (2003/2004/COD) or other applicable legislation becomes unduly onerous or burdensome, in which case the Company will use commercially reasonable efforts to obtain an alternative admission to listing, trading and/or quotation for the Notes by another listing authority, exchange and/or system within or outside the European Union, as it may decide and to the extent feasible.

 

9.9	Corporate Existence

 

Except as otherwise permitted under this Indenture and referred to below under Section 9.16 (Limitations on Mergers, Consolidations, Sales and Conveyances), the Company, at all times, will do all things necessary to preserve and keep in full force and effect its corporate existence and preserve and keep in full force and effect in all respects all material licenses and permits necessary to the proper conduct of its business and its rights (charter and statutory) and franchises and such rights and franchises of its Restricted Subsidiaries necessary to the proper conduct of the business of the Company and such Subsidiaries, as a whole.

 

9.10	Conduct of Business.

 

The Company and its Restricted Subsidiaries will not engage in any business other than a Permitted Business.

 

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9.11	Maintenance of Properties

 

The Company will cause all material tangible properties used in the conduct of its business or the business of any of its Significant Subsidiaries to be maintained and kept in good condition, repair and working order and supplied with all necessary equipment and will cause to be made all necessary repairs, renewals, replacements and improvements thereof, all as in the Company’s judgment may be necessary so that the business carried on in connection therewith may be properly and advantageously conducted at all times; provided, however, that this covenant will not prevent the Company or any of its Subsidiaries from discontinuing the operation or maintenance of any of such properties if such discontinuance is desirable in the conduct of its business and the business of its Subsidiaries taken as a whole and not adverse in any material respect to the Holders of the Notes.

 

9.12	Maintenance of Insurance

 

The Company will, and will cause each of its Subsidiaries to, maintain insurance in such amounts and covering such risks as is usually carried by electricity distribution companies, subject to any applicable laws and regulations of Argentina.

 

9.13	Payment of Taxes and Other Claims

 

The Company will, and will cause each of its Subsidiaries to, pay or discharge or cause to be paid or discharged, before the same shall become delinquent, all taxes, assessments and governmental charges levied or imposed upon the Company or its Subsidiaries; provided, however, that neither the Company nor any Subsidiary will be required to pay or discharge or cause to be paid or discharged any such tax, assessment, charge or claim which is being contested in good faith and, if appropriate, by appropriate legal proceedings, provided that adequate reserves with respect thereto are maintained on the books of the Company or such Subsidiary, as the case may be, to the extent required by Argentine GAAP.

 

9.14	Designation of Restricted and Unrestricted Subsidiaries.

 

(a)	The Company may designate any Subsidiary, including a newly acquired or created Subsidiary, to be an Unrestricted Subsidiary under this Indenture if:

 

(i)

the Restricted Subsidiary is not a Significant Subsidiary;

 

(ii)

no Default or Event of Default shall have occurred and be continuing at the time of and after giving effect to such designation;

 

(iii)

such Subsidiary does not own any Capital Stock of the Company or any Restricted Subsidiary or hold any Indebtedness of, or any Lien on any property of, the Company or any Restricted Subsidiary; and

 

(iv)

the Subsidiary is not party to any transaction or arrangement with the Company or any Restricted Subsidiary that would not be permitted under Section 9.4 (Limitation on Transactions with Shareholders and Affiliates).

 

If the Subsidiary being designated as an Unrestricted Subsidiary is, at the time of designation, a Restricted Subsidiary, the consequences set forth in paragraph (c) apply. Once so designated, the Subsidiary will remain an Unrestricted Subsidiary, subject to paragraph (b).

 

(b)

(i)

A Subsidiary previously designated an Unrestricted Subsidiary which fails to meet the qualifications set forth in paragraph (a) above will be deemed to become at that time a Restricted Subsidiary, subject to the consequences set forth in paragraph (d).

 

(ii)

The Company may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if the designation would not cause a Default

 

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(c)	Upon a Restricted Subsidiary becoming an Unrestricted Subsidiary:

 

(i)

all existing Investments of the Company and the Restricted Subsidiaries therein valued at the Company’s proportional share of the fair market value of its assets less liabilities will be deemed made at that time;

 

(ii)

all existing Indebtedness of the Company or a Restricted Subsidiary held by it will be deemed incurred at that time, and all Liens on property of the Company or a Restricted Subsidiary held by it will be deemed incurred at that time;

 

(iii)

all existing transactions between it and the Company or any Restricted Subsidiary will be deemed entered into at that time; and

 

(iv)

it will cease to be subject to the provisions of this Indenture and the Notes as a Restricted Subsidiary.

 

(d)	Upon an Unrestricted Subsidiary becoming, or being deemed to become, a Restricted Subsidiary:

 

(i)

all of its Indebtedness and Disqualified Stock will be deemed incurred at that time for purposes of Section 9.2 (Limitations on Indebtedness);

 

(ii)

Investments therein previously charged under Section 9.5 (Limitation on Restricted Payments), as adjusted to reflect any change in the Company’s proportional share of the fair market value of its assets less liabilities, will be credited thereunder; and

 

(iii)

it will thenceforward be subject to the provisions of this Indenture and the Notes as a Restricted Subsidiary.

 

Any designation by the Company of a Subsidiary as a Restricted Subsidiary or Unrestricted Subsidiary shall, unless so noted by the Company, be deemed to include the designation of all of the Subsidiaries of such Subsidiary. Any designation by the Company of a Subsidiary as a Restricted Subsidiary or Unrestricted Subsidiary will be evidenced to the Trustee by delivering to the Trustee a copy of the resolutions of the Board of Directors giving effect to the designation and an Officers’ Certificate certifying that the designation complied with the foregoing provisions, not later than the next succeeding delivery of financial statements as required under Section 9.6 (Delivery of Financial Statements).

 

9.15	Limitation of Applicability of Certain Covenants

 

Notwithstanding the foregoing, the obligations of the Company and its Restricted Subsidiaries to comply with the covenants described above under the captions Sections 9.2 (Limitations on Indebtedness), 9.3 (Limitations on Asset Sales), and 9.5 (Limitation on Restricted Payments) (collectively, the Suspended Covenants) will be suspended and cease to have any further effect during the period (the Suspended Period) from and after the first date that either (a) the Company attains from at least one of the Rating Agencies, a rating on its long-term debt denominated in currencies other than pesos that is Investment Grade or (b) the Leverage Ratio (as certified by the Company’s auditors) is equal to or lower than 2.5 and until, as applicable, the date (the Reversion Date) on which either (i) none of the Rating Agencies provide the Company’s non-Peso denominated long-term debt an Investment Grade rating or (ii) the Leverage Ratio is greater than 2.5. On the Reversion Date, the Company and its Restricted Subsidiaries’ obligation to comply with the Suspended Covenants shall be reinstated; provided, however, that the Suspended Covenants will not be of any effect with regard to actions of the Company or its Restricted Subsidiaries taken during the Suspension Period, and no Event of Default will be deemed to have occurred as a result of a failure to comply with the Suspended Covenants during the Suspension Period.

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On the Reversion Date, all Indebtedness incurred while the Suspended Covenants were suspended will be classified to have been incurred pursuant to one of the paragraphs set forth in Section 9.2 (Limitations on Indebtedness) (to the extent such Indebtedness would be permitted to be incurred thereunder as of the Reversion Date and after giving effect to Indebtedness outstanding on the Reversion Date). To the extent such Indebtedness would not be so permitted to be incurred pursuant to Section 9.2 (Limitations on Indebtedness) such Indebtedness will be deemed to have been outstanding on the Issuance Date, so that it is classified as permitted under paragraph (a) of Section 9.2 (Limitation on Indebtedness).

 

9.16	Limitations on Mergers, Consolidations, Sales and Conveyances

 

The Company will not enter into any merger, consolidation, spin-off or reorganization with any Person (whether or not the Company is the surviving or continuing Person) or sell, assign, transfer or otherwise convey or dispose of all or substantially all of its and its Restricted Subsidiaries’ assets, taken as a whole, whether by one transaction or a series of transactions, to any Person unless:

 

(a)	the surviving or transferee Person (if not the Company) is a sociedad anónima organized under the laws of Argentina;

 

(b)	the surviving or transferee Person (if not the Company) shall have expressly assumed, by a document executed and delivered to the Trustee in form and substance reasonably satisfactory to the Trustee, all of the obligations of the Company under the Notes and this Indenture;

 

(c)

immediately after giving effect to such transaction or series of transactions on a pro forma basis, (A) no Default or Event of Default shall have occurred and be continuing, and (B) the Leverage Ratio of the Company or such surviving entity will be equal to or lower than the Leverage Ratio of the Company immediately prior to such transaction, as certified by the Company’s auditors;

 

(d)	the rating of the Notes by any Rating Agency shall not have been downgraded as a result of such transaction or series of transactions within sixty (60) days of the public announcement of such transaction or series of transactions; and

 

(e)	the surviving or transferee Person shall have delivered to the Trustee an Officers’ Certificate stating that such merger, consolidation, sale, assignment, transfer or other conveyance or disposition complies with this covenant and this Indenture.

 

Upon the occurrence of any of the transactions permitted by the preceding paragraph, the surviving or transferee Person (if not the Company) will succeed to and become substituted for the Company, and may exercise every right and power of the Company, with the same effect as if it had been named in the Notes and this Indenture. Following such transaction, the Company will be released from its liability as obligor on the Notes and under this Indenture.

 

In the event of any such sale, assignment, transfer, conveyance or disposition, the Company, as the predecessor entity, may be dissolved, wound-up or liquidated at any time thereafter.

 

9.17	Payment of Additional Amounts

 

All payments of principal, premium or interest by the Company in respect of the Notes will be made without deduction or withholding for or on account of any present or future taxes, penalties, fines, duties, assessments or other governmental charges of whatever nature imposed or levied by or on behalf any Argentine Tax Jurisdiction (Argentine Taxes), unless the Company is compelled by law to deduct or withhold such Argentine Taxes. In any such event, the Company will pay such additional amounts (Additional Amounts) in respect of Argentine Taxes as may be necessary to ensure that the amounts received by Holders and beneficial owners of such Notes after such withholding or deduction will equal the respective amounts that would have been received in respect of such Notes in the absence of such withholding or deduction, except that no such Additional Amounts will be payable:

 

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(a)

to or on behalf of a Holder or beneficial owner of a Note that is liable for Argentine Taxes in respect of such Note by reason of having a present or former connection with an Argentine Tax Jurisdiction other than merely the holding or owning of such Note or the enforcement of rights with respect to such Note or the receipt of income or any payments in respect thereof;

 

(b)

to or on behalf of a Holder or beneficial owner of a Note in respect of Argentine Taxes that would not have been imposed but for the failure of the Holder or beneficial owner of a Note to comply with any certification, identification, information, documentation or other reporting requirement (within 45 calendar days following a written request from the Company to the Holder or beneficial owner, as applicable, for compliance) if such compliance is required by applicable law, regulation, administrative practice or an applicable treaty as a precondition to exemption from, or reduction in the rate of deduction or withholding of, Argentine Taxes;

 

(c)	to or on behalf of a Holder or beneficial owner of a Note in respect of any estate, inheritance, gift, sales, transfer, personal assets or similar tax, assessment or other governmental charge;

 

(d)	to or on behalf of a Holder or beneficial owner of a Note in respect of Argentine Taxes payable otherwise than by withholding from payment of principal of, premium, if any, or interest on the Notes;

 

(e)

to or on behalf of a Holder or beneficial owner of a Note in respect of any Taxes that are imposed on a payment to an individual and are required to be made pursuant to European Council Directive 2003/48/E on the taxation of savings income or any other directive implementing the conclusions of the ECOFIN Council meetings of November 26 and 27, 2000, December 13, 2001, and January 21, 2003, or any law implementing or complying with, or introduced in order to conform to, such a directive;

 

(f)	to or on behalf of a Holder or beneficial owner of a Note in respect of any Taxes that would not have been imposed if presentation for payment of the relevant notes had been made to a paying agent other than the paying agent to which the presentation was made;

 

(g)	to or on behalf of a Holder or beneficial owner of a Note in respect of Argentine Taxes that would not have been imposed but for the fact that the Holder presented such Note for payment (where presentation is required) more than 30 days after the later of :

 

(i)

the date on which such payment became due and

 

(ii)

if the full amount payable has not been received by the Trustee on or prior to such due date, the date on which, the full amount is received and notice of such receipt has been given to the Holders by the Trustee; or

 

(h)	any combination of items (a) to (g) above;

 

nor will Additional Amounts be paid with respect to any payment of the principal of, or any premium or interest on, any Notes to any Holder or beneficial owner of a Note who is a fiduciary or partnership or limited liability company or other than the sole beneficial owner of such payment to the extent such payment would be required by the laws of an Argentine Tax Jurisdiction to be included in the income for tax purposes of a beneficiary or settlor with respect to such fiduciary or a member of such partnership, limited liability company or beneficial owner who would not have been entitled to such Additional Amounts had it been the Holder of such Notes.

 

To the extent required by applicable law, the Company will withhold or deduct any Argentine Taxes required by such law and remit the full amount deducted or withheld to the relevant authority.

 

The Company will furnish to the Trustee, within 60 days after the date of receipt of written request from the Holders or beneficial owners of the Notes through the Trustee, copies of such receipts evidencing the payment of any Argentine Taxes so deducted or withheld in such form as provided in the normal course by the taxing authority imposing such Argentine Taxes and as is reasonably available to us or to the Trustee. The Trustee will make such evidence available to the Holders or beneficial owners of Notes upon request.

 

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The Company will pay any present or future stamp, issue, registration, court, documentation, excise or other similar taxes, charges and duties, including interest and penalties with respect thereto, imposed by any Argentine Tax Jurisdiction in respect of the execution, issue, registration or delivery of the Notes or any other document or instrument referred to hereunder and any such taxes, charges or duties imposed by any jurisdiction as a result of, or in connection with, the enforcement of the Notes and/or any other such document or instrument.

 

The Company covenants that if the Company or the Trustee or any Paying Agent is required by law to make any deduction or withholding on payments of principal of or interest on the Notes for or on account of any Argentine tax, duty, assessment or other governmental charge, the Company shall, at least 10 Business Days prior to the first payment on which such deduction or withholding is applicable, (and at least 10 Business Days prior to each succeeding payment date or any redemption date or maturity date if there has been any change with respect to the matters set forth in the below-mentioned Officer’s Certificate) deliver to the Trustee (with a copy to any other Paying Agent) an Officer’s Certificate specifying the amount so required to be deducted or withheld and certifying that the Company shall pay such deduction or withholding.

 

The Company hereby covenants to indemnify the Trustee (and each other Paying Agent) for, and to hold the Trustee harmless against any loss, liability or expense incurred without negligence or bad faith on the Trustee’s part arising out of actions taken or omitted by any of them in reliance on any Officer’s Certificate furnished pursuant to this Section 9.17 or the failure of the Trustee to receive on a timely basis such Officer’s Certificate or any information or documentation requested by it or otherwise required by applicable laws or regulations to be obtained, furnished or filed in respect of any tax, duty, assessment or other governmental charge pursuant to the foregoing provisions of this Section 9.17.

 

The indemnification obligations of the Company under this Section 9.17 shall survive the payment of the Notes, the resignation or removal of the Trustee and any termination, defeasance or discharge of the Indenture and will apply mutatis mutandis to any successor Person to the Company and to any jurisdiction in which such successor is organized or is otherwise resident for tax purposes or any jurisdiction from or through which payment is made by such successor or its respective agents.

 

9.18	Money for Note Payments to be Held in Trust

 

If the Company shall at any time act as its own Paying Agent, it will, on or before each payment date of the principal of (and premium, if any) or interest on any of the Notes, segregate and hold in trust for the benefit of the Persons entitled to such payment a sum sufficient to pay the principal (and premium, if any) or interest due until such sums shall he paid to such Persons or otherwise disposed of as herein provided and will promptly notify the Trustee of its action or failure so to act

 

Whenever the Company shall have one or more Paying Agents, it will, prior to each payment date of the principal of (and premium, if any) or interest on any Notes, deposit with a Paying Agent a sum sufficient to pay such amount, such sum to be held as provided by the Trust Indenture Act, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act. Principal and interest shall be considered paid on the date due if on such date the Trustee or Paying Agent (other than the Company or an Affiliate of the Company) holds in accordance with this Indenture U.S. Dollars designated for and sufficient to pay all principal and interest then due and the Trustee or the Paying Agent, as the case may be, is not prohibited from paying such money to the Holders on that date pursuant to the terms of this Indenture.

 

The Company will cause each Paying Agent, other than the Trustee, to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section 9.18, that such Paying Agent will:

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(a)	hold all sums held by it for the payment of the principal of (and premium, if any) or interest, or any other amounts due on Notes, in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided;

 

(b)	give the Trustee notice of any default by the Company (or any other obligor upon the Notes) in the making of any payment of principal (and premium, if any) or interest or any other amounts due on the Notes; and

 

(c)	at any time during the continuance of any such default, upon the written request of the Trustee, immediately pay to the Trustee all sums so held in trust by such Paying Agent.

 

The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same term as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such money.

 

Any money deposited with the Trustee or any Paying Agent, or held by the Company, in trust for the payment of the principal of (and premium, if any) or interest on any Note which remains unclaimed for three years after such principal (and premium, if any) or interest has become due and payable shall be paid to the Company on Company Request, or (if then held by the Company) shall be discharged from such trust; and the Holder of such Note shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in a newspaper customarily published on each Business Day and of general circulation in the city of Buenos Aires, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Company.

 

9.19	Ranking of Notes

 

The Company will ensure that its obligations under the Notes will at all times constitute direct, unconditional, unsecured and unsubordinated obligations of the Company ranking at least pari passu in priority of payment, in right of security upon liquidation and in all other respects among themselves and with all other unsecured indebtedness of the Company now or hereafter outstanding, except to the extent that such other indebtedness may be preferred by mandatory provisions of applicable law or subordinated by its terms.

 

ARTICLE 10. REDEMPTION OF NOTES

 

10.1	Applicability of Article

 

Redemption of Notes, at the election of the Company or otherwise, as permitted or required by any provision of this Indenture, shall be made in accordance with such provision and this Article 10.

 

10.2	Redemption at the Company’s Option

 

(a)

At any time and from time to time prior to October 9, 2012, upon not less than 30 nor more than 60 days notice, the Company may redeem the Notes with the net cash proceeds received by it from any Public Equity Offering at a redemption price equal to 110.5% of the principal amount plus accrued and unpaid interest to the redemption date, in an aggregate principal amount for all such redemptions not to exceed 35% of the original aggregate principal amount of the Notes, including any additional notes of such series; provided that (i) in each case the redemption takes place not later than 180 days after the closing of the related Public Equity Offering, and (ii) not less than 65% of the original aggregate principal amount of the Notes (calculated after giving effect to any issuance of additional notes of such series) remains outstanding immediately thereafter.

 

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(b)

At any time on or after October 9, 2012 and prior to maturity, upon not less than 30 nor more than 60 days’ notice to the Trustee, the Company may redeem all or part of the Notes. These redemptions will be in amounts of U.S. $2,000 or integral multiples of U.S. $1,000 in excess thereof at the following redemption prices (expressed as percentages of their principal amount at maturity) plus, in each case, accrued and unpaid interest and Additional Amounts, if any, to the redemption date, if redeemed during the 12-month period commencing on October 9 of the years set forth below. This redemption is subject to the right of holders of record on the relevant regular Record Date that is prior to the Redemption Date to receive interest due on an Interest Payment Date.

 

Year		Redemption Price
2012			105.250	%
2013			102.625	%
2014			101.313	%
2015 and thereafter			100	%

 

Notice of redemption will be given as described herein.

 

(c)

Subject to the foregoing, in the case of any Optional Redemption of less than all of the Notes, such Notes will be redeemed, to the extent permitted under applicable law and securities exchange rules, on a pro rata basis. If any Notes are to be redeemed only in part, the notice of redemption relating to such Notes shall state the portion of the principal amount thereof to be redeemed. Notes in principal amount equal to the unredeemed portion thereof will be issued in the name of the holder thereof upon cancellation of the original Notes. Interest, if any, will cease to accrue on the Notes or portions thereof called for redemption on the later of the redemption date or the date on which the relevant redemption price is effectively paid to holders of Notes or portions thereof called for redemption.

 

10.3	Repurchase at the Option of Holders Upon a Change of Control

 

If a Change of Control occurs, each Holder of the Notes will have the right to require the Company to repurchase all or any part (in any integral multiple of U.S. $1,000.00) of that Holder’s Notes pursuant to an offer (the Change of Control Offer) made by the Company on the terms set forth in this Indenture. In the Change of Control Offer, the Company will offer to purchase such Holder’s Notes at a purchase price in cash equal to 100% of the aggregate principal amount of such Notes to be repurchased plus accrued and unpaid interest and Additional Amounts, if any, on such Notes to be repurchased to the date of purchase, subject to the rights of Holders of such Notes on the relevant record date to receive interest due on the relevant interest payment date (the Change of Control Payment). Within 30 days following a Change of Control, the Company will mail a notice to each holder describing the transaction or transactions that constitute the Change of Control and offering to repurchase the applicable Notes on a date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is mailed (the Change of Control Payment Date), pursuant to the procedures required by this Indenture and described in such notice. To the extent that the provisions of any securities laws or regulations to be issued in the future conflict with the Change of Control provisions of this Indenture, the Company will make the Change of Control Offer in accordance with the applicable provisions of the securities laws and regulations (and the terms set forth herein that do not conflict with such provisions) and will not be deemed to have breached its obligations under the Change of Control provisions of this Indenture by virtue of such compliance.

 

On the Change of Control Payment Date, the Company will, to the extent lawful:

 

(a)	accept for payment all Notes or portions of Notes properly tendered pursuant to the Change of Control Offer;

 

(b)	deposit with the Trustee an amount equal to the Change of Control Payment in respect of all Notes or portions of Notes properly tendered; and

 

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(c)	deliver or cause to be delivered to the Trustee the Notes properly accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions of Notes being purchased by the Company.

 

The Trustee will promptly deliver to each Holder of Notes properly tendered the Change of Control Payment for such Notes, and the Trustee will promptly authenticate and mail (or cause to be transferred by book entry) to each Holder a new Note equal in principal amount to any unpurchased portion of the Notes surrendered, if any. The Company will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.

 

The Company will not be required to make a Change of Control Offer upon a Change of Control if (1) a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in the Indenture applicable to a Change of Control Offer made by the Company and purchases all Notes properly tendered and not withdrawn under the Change of Control Offer, or (2) notice of redemption has been given pursuant to this Indenture as described under Section 10.2 (Redemption at the Company’s Option), unless and until there is a default in payment of the applicable redemption price.

 

10.4	Redemption for Taxation Reasons

 

The Company may redeem the Notes at its option in whole, but not in part, at any time, on giving not less than 30 nor more than 60 days’ written notice (which will be irrevocable) to the Trustee and, if applicable, to the CNV, in writing and to the Luxembourg Stock Exchange, if the rules of such exchange so require, such notice to be given by publication in the English language in a leading newspaper having general circulation in Luxembourg (which is expected to be the d’Wort or the Tageblatt), or, alternatively, on the website of the Luxembourg Stock Exchange at ▇▇▇▇://▇▇▇.▇▇▇▇▇▇.▇▇. The notes may be redeemed at a redemption price equal to 100% of the outstanding principal amount thereof, together with any accrued but unpaid interest and any Additional Amounts to the date fixed for redemption, if, as a result of any change in, or amendment to, the laws (or any regulations or rulings issued thereunder) of the Republic of Argentina or any political subdivision of or any taxing authority in the Republic of Argentina (each an Argentine Tax Jurisdiction) or any change in the application, administration or official interpretation of such laws, regulations or rulings, including, without limitation, the holding of a court of competent jurisdiction, the Company has or will become obligated to pay Additional Amounts with respect to a payment on or in respect of the Notes, which change or amendment becomes effective on or after the date of issuance of the Notes (or, in the case of a successor Person to the Company, as of the date such Person assumes the obligations of the Company), and the Company determines in good faith that such obligation cannot be avoided by its taking reasonable measures available to it. No such notice of redemption may be given earlier than 60 days prior to the earliest date on which we would be obligated to pay such Additional Amounts were a payment in respect of the Notes then due. Prior to the distribution of any notice of redemption pursuant to this paragraph, the Company will deliver to the Trustee a certificate signed by a duly authorized Officer stating that it has or will become obligated to pay Additional Amounts as a result of such change or amendment, and that such obligation cannot be avoided by its taking reasonable measures available to it. The Company will also deliver to the Trustee, prior to the distribution of such notice, an Opinion of Counsel to the effect that as a result of such change or amendment the Company will be obligated to pay Additional Amounts. The Trustee will be entitled to accept such certificate and such opinion as sufficient evidence of the satisfaction of the conditions precedent contained in the second preceding sentence, in which event it will be conclusive and binding on the Holders.

 

10.5	Market Purchases

 

The Company may at any time and from time to time purchase Notes to the extent permitted by applicable law. 

 

10.6	Selection by Trustee of Notes to be Redeemed

 

If less than all of the Notes are to be redeemed at any time, the Trustee will select the particular Notes or portions (equal to U.S. $1,000 or any integral multiple thereof) as follows:

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(a)	if the Notes are listed on one or more securities exchanges, in compliance with the requirements, if any, of the principal securities exchange on which the Notes are listed (as set forth in an Officers’ Certificate delivered by the Company to the Trustee); or

 

(b)	if the Notes are not so listed or if such requirements are not so certified, on a pro rata basis, by lot or by such method as the Trustee deems fair and appropriate.

 

The Trustee shall promptly notify the Company and each Registrar in writing of the Notes selected for redemption and, in the case of any Notes selected for partial redemption, the principal amount thereof to be redeemed.

 

For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Notes shall relate, in the case of any Notes redeemed or to be redeemed only in part, to the portion of the principal amount of such Notes which has been or is to be redeemed.

 

10.7	Notice of Redemption

 

Notice of redemption shall be given by first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption Date, to each Holder of Notes to be redeemed, at his address appearing in the Note Register. In addition, the Company shall, at least 30 and not more than 60 days before the Redemption Date, cause notice of such redemption to be published in the Daily Bulletin of the Buenos Aires Stock Exchange and a leading newspaper having a general circulation in Argentina (expected to be La Nación) and, so long as the Notes are listed on the Luxembourg Stock Exchange and the rules of such stock exchange so require, a newspaper having a general circulation in Luxembourg (expected to be the d’Wort), with a copy to the Trustee. Notices of redemption may not be conditional.

 

All notices of redemption shall identify the Note and state:

(a)	the Redemption Date;
(b)	the Redemption Price;
(c)	a brief statement setting forth the Company’s right to effect such redemption and, if any conditions to such redemption apply, the Company’s basis therefor;
(d)	if less than all the Notes then Outstanding are to be redeemed, the identification (and, in the case of partial redemption of any Notes, the principal amounts) of the particular Notes to be redeemed;
(e)	that on the Redemption Date the Redemption Price will become due and payable upon each such Note to be redeemed and that interest thereon will cease to accrue on and after said date; and
(f)	unless all of the Notes are Global Notes, the place or places where such Notes are to be surrendered for payment of the Redemption Price.

Notice of redemption of Notes to be redeemed at the election of the Company shall be given by the Company or, at the Company’s request, by the Trustee in the name and at the expense of the Company.

 

10.8	Deposit of Redemption Price

 

On or before 12:00 noon, New York time, at least one Business Day prior to any Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 9.17 (Payment of Additional Amounts)) an amount of money sufficient to pay the Redemption Price of, and (except if the Redemption Date shall be an Interest Payment Date) accrued interest on and any Additional Amounts, all the Notes which are to be redeemed on that date.

 

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10.9	Notes Payable on Redemption Date

 

Notice of redemption having been given as aforesaid, the New Debt so to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price together with accrued interests and Additional Amounts, if any therein specified, and from and after such date (unless the Company shall default in the payment of the Redemption Price, accrued interest and any Additional Amounts) such Notes shall cease to bear interest. Upon surrender of any such Note for redemption in accordance with said notice, such Note shall be paid by the Company at the Redemption Price, together with accrued interest to the Redemption Date and any Additional Amounts; provided, however, that installments of interest whose Stated Maturity is on or prior to the Redemption Date shall be payable to the Holders of such Notes or one or more Predecessor Notes, registered as such at the close of business on the relevant Record Dates according to their terms and the provisions of Section 3.6 (Payment of Interest; Interest Rights Preserved) and to Lenders, if applicable.

 

If any Note called for redemption shall not be so paid upon surrender thereof for redemption, the principal (and premium, if any) shall, until paid, bear interest from the Redemption Date at the rate borne by the Note.

 

10.10

Notes Redeemed in Part

 

Any Note that is not a Global Note and that is to be redeemed only in part shall be surrendered at an office or agency of the Company (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or his attorney duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and deliver to the Holder of such Note without service charge, a new Note or Notes, of any authorized denomination as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Note so surrendered. If any Global Note is to be redeemed in part, the Paying Agent shall forward such Global Note to the Trustee who shall make a notation on Schedule A thereof to reduce the principal amount at maturity of such Global Note by an amount equal to the redeemed portion of the Global Note, provided that the Global Note shall be in an authorized denomination.

 

10.11

Redemptions and Purchases of the Notes

 

In this Indenture and the Notes, the Company’s obligations to prepay or repurchase the Notes shall be construed to give effect to the Company’s concurrent obligation to purchase or prepay all of the Notes, on a pro rata basis.

 

ARTICLE 11. DEFEASANCE AND COVENANT DEFEASANCE

 

11.1	Company’s Option to Effect Defeasance or Covenant Defeasance

 

The Company may at its option by Board Resolution, at any time, elect to have either Section 11.2 (Defeasance and Discharge) or Section 11.3 (Covenant Defeasance) applied to the Notes then Outstanding upon compliance with the conditions set forth below in this Article 11.

 

11.2	Defeasance and Discharge

 

Upon the Company’s exercise of the option provided in Section 11.1 (Company’s Option to Effect Defeasance or Covenant Defeasance) applicable to this Section 11.2, the Company shall be deemed to have been discharged from its obligations with respect to the Notes then Outstanding on the date the conditions set forth below are satisfied with respect to such Notes (hereinafter, defeasance). For this purpose, such defeasance means that the Company shall be deemed to have paid and discharged the entire indebtedness represented by the Notes then Outstanding and to have satisfied all its other obligations under such Notes and this Indenture insofar as such Notes are concerned (and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following, which shall survive until otherwise terminated or discharged hereunder:

(a)

the rights of Holders of such Notes to receive, solely from the trust fund described in Section 11.4 (Conditions to Defeasance or Covenant Defeasance) and as more fully set forth in such Section 11.4 (Conditions to Defeasance or Covenant Defeasance), payments in respect of the principal of (and premium, if any) and interest and Additional Amounts, if any, on such Notes when such payments are due;

 

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(b)	the Company’s obligations with respect to such Notes under Sections 3.4 (Registration, Registration of Transfer and Exchange Generally), 3.5 (Mutilated, Destroyed, Lost and Stolen Notes), 3.6 (Payment of Interest; Interest Rights Preserved);
(c)	the rights, powers, trusts, duties and immunities of the Trustee hereunder, and
(d)	this Article 11.

 

Subject to compliance with this Article 11, the Company may pursuant to Section 11.1 (Company’s Option to Effect Defeasance or Covenant Defeasance) elect to have this Section 11.2 applied to the Notes then Outstanding notwithstanding its prior election pursuant to Section 11.1 (Company’s Option to Effect Defeasance or Covenant Defeasance) to have Section 11.3 (Covenant Defeasance) applied to the Notes then Outstanding.

 

11.3	Covenant Defeasance

 

Upon the Company’s exercise of the option provided in Section 11.1 (Company’s Option to Effect Defeasance or Covenant Defeasance) applicable to this Section.

(a)	the Company shall be released from its obligations under Article 9 (Covenants); and
(b)	the occurrence of an event specified in Section 5.1(d) (Events of Default) (with respect to Article 9) shall not be deemed to be an Event of Default on and after the date the conditions set forth below are satisfied (hereinafter, covenant defeasance).

For this purpose, such covenant defeasance means that the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such section or clause, whether directly or indirectly by reason of any reference elsewhere herein to any such section or clause or by reason of any reference in any such section or clause to any other provision herein or in any other document, but the remainder of this Indenture and such Notes shall be unaffected thereby.

 

11.4	Conditions to Defeasance or Covenant Defeasance

 

The following shall be the conditions to application of either Section 11.2 (Defeasance and Discharge) or Section 11.3 (Covenant Defeasance) to the Notes:

(a)

The Company shall irrevocably have deposited or caused to be deposited with the Trustee funds in trust, for the benefit of Holders of the Notes, cash in U.S. Dollars or U.S. Government Obligations, or a combination thereof, sufficient, in the opinion of a recognized firm of independent certified public accountants, to pay and discharge the principal of and each installment of interest (and Additional Amounts) on such Notes on the Stated Maturity of such principal or installment of Interest in accordance with the terms of this Indenture and of the Notes;

(b)

in the case of defeasance, the Company shall have delivered to the Trustee an Opinion of Counsel stating that (i) the Company has received from, or there has been published by, the United States Internal Revenue Service a ruling (that in each case applies to defeasance) or (ii) since the date of this Indenture there has been a change in the applicable United States federal income tax law, in either case to the effect that the Holders of the outstanding Notes will not recognize income, gain or loss for United States federal income tax purposes as a result of such deposit, defeasance and discharge and will be subject to United States federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such deposit, defeasance and discharge had not occurred;

 

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(c)	in the case of covenant defeasance, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the Holders of the respective outstanding Notes will not recognize income, gain or loss for United States federal income tax purposes as a result of such deposit and covenant defeasance and will be subject to United States federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such deposit and or covenant defeasance had not occurred;
(d)	no Event of Default or event which with the giving of notice, lapse of time or satisfaction or any other condition or any combination of the foregoing would become an Event of Default shall have occurred and be continuing on the date of such deposit or will occur as a result of such deposit or, insofar as Events of Default resulting from bankruptcy or insolvency events are concerned, at any time during the period ending on the 121st day after the date of such deposit (it being understood that this condition shall not be deemed satisfied until the expiration of such period);
(e)	such defeasance or covenant defeasance shall not cause the Trustee to have a conflicting interest as defined in this Indenture and for purposes of the Trust Indenture Act with respect to any securities of the Company;
(f)	such defeasance or covenant defeasance shall not result in a breach or violation of, or constitute a default under, any other agreement or instrument to which the Company is a party or by which it is bound;
(g)	the Company shall have delivered to the Trustee an Officers’ Certificate stating that all conditions precedent provided for relating to either defeasance or covenant defeasance, as the case may be, have been complied with and no violations under instruments or agreements governing any other outstanding Indebtedness of the Company would result as a consequence of such defeasance or covenant defeasance, as the case may be;
(h)	the Company has delivered to the Trustee, subject to certain exceptions set forth in this Indenture, an opinion of its Argentine counsel to the effect that after two years following the deposit, the trust funds deposited in accordance with Argentine law No. 24,441 will not be subject to the effect of any applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally under the laws of Argentina; and
(i)	the Company shall have paid or duly provided for payment of all amounts then due to the Trustee pursuant to the terms of this Indenture.

 

11.5	Deposited Money and Government Obligations to be Held in Trust; Other Miscellaneous Provisions

 

Subject to the provisions of the last paragraph of Section 10.2 (Redemption at the Company’s Option), all Dollars and Government Obligations (including the proceeds thereof) deposited with the Trustee or other qualifying trustee (collectively, for purposes of this Section 11.5, the Trustee) pursuant to Section 11.4 (Conditions to Defeasance or Covenant Defeasance) in respect of the Notes shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent as the Trustee may determine, to the Holders of such Notes, of all sums due and to become due thereon in respect of principal (and premium, if any) and interest, but such money need not be segregated from other funds except to the extent required by law.

 

The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the Dollars or the Government Obligations deposited with the Trustee pursuant to Section 11.4 (Conditions to Defeasance or Covenant Defeasance) or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the Notes.

 

Anything in this Article 11 to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon Company Request any Dollars or Government Obligations held by it as provided in Section 11.4 (Conditions to Defeasance or Covenant Defeasance) which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, are in excess of the amount thereof which would then be required to be deposited to effect an equivalent defeasance or covenant defeasance.

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11.6	Reinstatement

 

If the Trustee or any Paying Agent is unable to apply any money in accordance with Section 11.2 (Defeasance and Discharge) or Section 11.3 (Covenant Defeasance) by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company’s obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to this Article 11 until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Section 11.2 (Defeasance and Discharge) or Section 11.3 (Covenant Defeasance); provided, however, that if the Company makes any payment of principal of (and premium, if any) or interest on any Note following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Notes to receive such payment from the money held by the Trustee or the Paying Agent.

 

ARTICLE 12. MISCELLANEOUS PROVISIONS

 

12.1	No Liability of Directors, Officers, Employees, Incorporators, Members, and Stockholders

 

Except as specifically provided under Argentine law, no director, officer, employee, member of the Statutory Audit Committee, incorporator, member or stockholder of the Company will have any liability for any obligations of the Company under the Notes or this Indenture, or for any claim based on, in respect of, or by reason of, such obligations. Each holder of the Notes by accepting such Notes waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. The waiver may not be effective to waive liabilities under the federal securities laws of the United States and it is the view of the SEC that such a waiver is against public policy. In addition, the waiver may not be effective to waive liabilities for any damage caused to Holders in violation of the Negotiable Obligations Law.

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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, all as of the day and year first above written.

 

EMPRESA DISTRIBUIDORA Y COMERCIALIZADORA NORTE S.A.

By:	/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
	▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title:	Director de Finanzas y Control
THE BANK OF NEW YORK, as Trustee
By:	/s/ ▇▇▇▇▇ ▇▇▇▇▇
	▇▇▇▇▇ ▇▇▇▇▇
Title:	Assistant Vice President
BANCO SANTANDER RÍO S.A., as representative of the Trustee in Argentina
By:	/s/ Oscar Amechino
	Oscar Amechino
Title:	Gerente Departamental
By:	/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
	▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title:	Gerente Principal

 

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EXHIBIT A

 

[Form of Face of Note]

 

[RESTRICTED / REGULATION S] 10.5% NOTE DUE 2017

 

Empresa Distribuidora y Comercializadora Norte S.A.

 

(incorporated in the City of Buenos Aires, Argentina, with Limited Liability (sociedad anónima) under the laws of the Republic of Argentina on July 21, 1992, for a term of duration of 95 years, and registered with the Public Registry of Commerce on August 3, 1992 under No. 7,041, Book  111, Volume A of Sociedades Anónimas and with principal offices at ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇)

 

Cusip No. [         ]

ISIN No. [         ]

No. [         ]

U.S. $[          ]

Series: 10.5% Senior Note due 2017 for an aggregate principal amount of U.S. $220,000,000 (the Notes)

 

[Legend if the Note is a Restricted Note:

 

THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE SECURITIES ACT) AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) (1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), OR (4) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES. EACH PURCHASER OF THIS NOTE OR ANY INTEREST HEREIN IS HEREBY NOTIFIED THAT THE TRANSFEROR OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.

 

[Legend if the Note is a Global Note:

 

THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE REFERRED TO HEREINAFTER.

 

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (DTC), NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.]

Exhibit A-1

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[Legend if the Note is a Certificated Note:

 

IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR SUCH OPINIONS OF COUNSEL, CERTIFICATES AND/OR OTHER INFORMATION AS THE COMPANY MAY REASONABLY REQUIRE IN FORM REASONABLY SATISFACTORY TO IT AS PROVIDED FOR IN THE INDENTURE TO CONFIRM THAT THE TRANSFER COMPLIED WITH THE FOREGOING RESTRICTIONS AS PROVIDED FOR IN THE INDENTURE.]

 

Empresa Distribuidora y Comercializadora Norte S.A., a sociedad anónima duly organized and existing under the laws of Argentina (herein called the Company, which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co., or to its registered assigns, the principal sum of U.S. $220,000,000 or such lesser amount as shall remain Outstanding after giving effect to any scheduled payment of principal or any cancellation, redemption or prepayment of this Note in accordance with the Indenture, and to pay interest thereon from October 9, 2007 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, semi-annually on April 9 and October 9 in each year, at the rate of 10.5% per year (the Interest Rate), until the principal hereof is paid or made available for payment and (to the extent that the payment of such interest shall be legally enforceable) at the rate of 2% per annum plus the Interest Rate on any overdue principal and premium and on any overdue installment of interest until paid.

 

The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Note (or one or more Predecessor Notes) is registered at the close of business on the Record Date for such interest, which shall be the March 25 or September 24 (whether or not a Business Day, as defined below), as the case may be, next preceding such Interest Payment Date. Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Holder on such Record Date and may either be paid to the Person in whose name this Note (or one or more Predecessor Notes) is registered at the close of business on a Special Record Date (as defined below) for the payment of such Defaulted Interest (as defined below) to be fixed by the Trustee, notice whereof shall be given to Holders of Notes not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture.

 

Interest on the Notes shall be computed based on a 360-day year of twelve 30-day months.

 

Payments in respect of this Note will be made by wire transfer of immediately available funds to the accounts specified by the Holder of this Note, or, if no account is specified, by mailing a check to each Holder’s address in the Registrar. All such payments are subject to the provisions in Section 1.15 (Legal Holidays) of the Indenture relating to legal holidays.

 

The Company may from time to time, without the consent of the holders of this Note, subject to the provisions of hereof, create and issue additional notes having terms and conditions the same as those of this Note (Additional Notes), except for the payment of interest accruing prior to the issue date of such Additional Notes and, in some cases, except for the first payment of interest following the issue date of such Additional Notes, which Additional Notes may be consolidated and form a single series with the outstanding Notes. The Company shall not issue any Additional Notes unless such Additional Notes have no more than a de minimis amount of original issue discount or such issuance would constitute a “qualified reopening” for U.S. federal income tax purposes.

 

Reference is hereby made to the further provisions of this Note set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

 

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

Exhibit A-2

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IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.

 

Dated: October       , 2007

 

By:
	Name:
	Title:    Member of the Board of Directors
By:
	Name:
	Title:    Member of the Statutory Audit Committee

Exhibit A-3

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CERTIFICATE OF AUTHENTICATION

 

This note is one of the Notes designated herein and referred to in the within-mentioned Indenture.

 

The Bank of New York,

AS TRUSTEE

 

By:
	(Authorized Signatory Name)
	Name:
	Title:

 

Exhibit A-4

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[If Note is a Global Note, insert the following:

 

SCHEDULE A

 

SCHEDULE OF PRINCIPAL AMOUNT

 

The initial principal amount at maturity of this Note shall be U.S. $220,000,000. The following decreases/increases in the principal amount at maturity of this Note have been made:

 

Date of Decrease/Increase

Decrease in Principal Amount at Maturity

Increase in Principal Amount at Maturity

Total Principal Amount at Maturity Following such Decrease/Increase

Notation Made by or on Behalf of Trustee

]

 

Exhibit A-5

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EXHIBIT B

 

[Form of Reverse of Note]

 

Reverse of Note

 

1.

This Note is a negotiable obligation under Argentine Law No. 23,576, as amended (the Negotiable Obligations Law). This Note is one of a duly authorized issue of Notes of the Company designated as its 10.5% Notes due 2017 (herein called the Notes) issued and to be issued under an Indenture, dated as of October 9, 2007, 2006 (herein called the Indenture), between the Company, The Bank of New York, as Trustee (herein called the Trustee, which term includes any successor trustee under the Indenture) and Banco Santander Río S.A. (as representative of the Trustee in Argentina, Registrar, Transfer and Paying Agent and herein called the Paying Agent, which term includes any successor paying agent under the Indenture) to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Notes and of the terms upon which the Notes are, and are to be, authenticated and delivered. References to Sections herein are references to Sections of the Indenture.

 

2.

In accordance with Section 10.2 (Redemption at the Company’s Option) of the Indenture, (A) At any time and from time to time prior to October 9, 2012, upon not less than 30 nor more than 60 days notice to the Trustee, the Company may redeem the Notes with the net cash proceeds received by it from any Public Equity Offering at a redemption price equal to 110.5% of the principal amount plus accrued and unpaid interest to the redemption date, in an aggregate principal amount for all such redemptions not to exceed 35% of the original aggregate principal amount of the Notes, including any additional notes of such series; provided that (i) in each case the redemption takes place not later than 180 days after the closing of the related Public Equity Offering, and (ii) not less than 65% of the original aggregate principal amount of the Notes (calculated after giving effect to any issuance of additional notes of such series) remains outstanding immediately thereafter and (B) At any time on or after October 9, 2012 and prior to maturity, upon not less than 30 nor more than 60 days’ notice, the Company may redeem all or part of the Notes. These redemptions will be in amounts of U.S. $2,000 or integral multiples of U.S. $1,000 in excess thereof at the following redemption prices (expressed as percentages of their principal amount at maturity) plus, in each case, accrued and unpaid interest and Additional Amounts, if any, to the redemption date, if redeemed during the 12-month period commencing on October 9 of the years set forth below. This redemption is subject to the right of holders of record on the relevant regular Record Date that is prior to the Redemption Date to receive interest due on an Interest Payment Date.

 

Year		Redemption Price
2012			105.250	%
2013			102.625	%
2014			101.313	%
2015 and thereafter			100	%

 

3.

In the event of redemption of this Note in part only, a new Note or Notes for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the cancellation hereof.

 

Exhibit B-1

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4.

In accordance with Section 10.3 (Repurchase at the Option of Holders Upon a Change of Control) of the Indenture, if a Change of Control occurs, each Holder of the Notes will have the right to require the Company to repurchase all or any part (in any integral multiple of U.S. $1,000.00) of that Holder’s Notes pursuant to an offer (the Change of Control Offer) made by the Company on the terms set forth in the Indenture. In the Change of Control Offer, the Company will offer to purchase such Holder’s Notes at a purchase price in cash equal to 100% of the aggregate principal amount of such Notes to be repurchased plus accrued and unpaid interest and Additional Amounts, if any, on such Notes to be repurchased to the date of purchase, subject to the rights of Holders of such Notes on the relevant record date to receive interest due on the relevant interest payment date (the Change of Control Payment). Within 30 days following a Change of Control, the Company will mail a notice to each holder describing the transaction or transactions that constitute the Change of Control and offering to repurchase the applicable Notes on a date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is mailed (the Change of Control Payment Date), pursuant to the procedures required by the Indenture and described in such Change of Control Offer Notice. To the extent that the provisions of any securities laws or regulations to be issued in the future conflict with the Change of Control provisions of the Indenture, the Company will make the Change of Control Offer in accordance with the applicable provisions of the securities laws and regulations (and the terms set forth herein that do not conflict with such provisions) and will not be deemed to have breached its obligations under the Change of Control provisions of the Indenture by virtue of such compliance.

 

5.

On the Change of Control Payment Date, the Company will, to the extent lawful:

 

a.

accept for payment all Notes or portions of Notes properly tendered pursuant to the Change of Control Offer;

 

b.

deposit with the Trustee an amount equal to the Change of Control Payment in respect of all Notes or portions of Notes properly tendered; and

 

c.

deliver or cause to be delivered to the Trustee the Notes properly accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions of Notes being purchased by the Company.

 

6.

The Trustee will promptly deliver to each Holder of Notes properly tendered the Change of Control Payment for such Notes, and the Trustee will promptly authenticate and mail (or cause to be transferred by book entry) to each Holder a new Note equal in principal amount to any unpurchased portion of the Notes surrendered, if any. The Company will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.

 

7.

The Company will not be required to make a Change of Control Offer upon a Change of Control if (1) a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in the Indenture applicable to a Change of Control Offer made by the Company and purchases all Notes properly tendered and not withdrawn under the Change of Control Offer, or (2) notice of redemption has been given pursuant to the Indenture as described under Section 10.2 (Redemption at the Company’s Option) of the Indenture, unless and until there is a default in payment of the applicable redemption price.

 

8.

The Company may redeem the Notes at its option in whole, but not in part, at any time, on giving not less than 30 nor more than 60 days’ written notice (which will be irrevocable) to the Trustee and, if applicable, to the CNV, in writing and to the Luxembourg Stock Exchange, if the rules of such exchange so require, such notice to be given by publication in the English language in a leading newspaper having general circulation in Luxembourg (which is expected to be the d’Wort or the Tageblatt), or, alternatively, on the website of the Luxembourg Stock Exchange at ▇▇▇▇://▇▇▇.▇▇▇▇▇▇.▇▇. The notes may be redeemed at a redemption price equal to 100% of the outstanding principal amount thereof, together with any accrued but unpaid interest and any Additional Amounts to the date fixed for redemption, if, as a result of any change in, or amendment to, the laws (or any regulations or rulings issued thereunder) of the Republic of Argentina or any political subdivision of or any taxing authority in the Republic of Argentina (each an Argentine Tax Jurisdiction) or any change in the application, administration or official interpretation of such laws, regulations or rulings, including, without limitation, the holding of a court of competent jurisdiction, the Company has or will become obligated to pay Additional Amounts with respect to a payment on or in respect of the Notes, which change or amendment becomes effective on or after the date of issuance of the Notes (or, in the case of a successor Person to the Company, as of the date such Person assumes the obligations of the Company), and the Company determines in good faith that such obligation cannot be avoided by its taking reasonable measures available to it. No such notice of redemption may be given earlier than 60 days prior to the earliest date on which we would be obligated to pay such Additional Amounts were a payment in respect of the Notes then due. Prior to the distribution of any notice of redemption pursuant to this paragraph, the Company will deliver to the Trustee a certificate signed by a duly authorized officer stating that it has or will become obligated to pay Additional Amounts as a result of such change or amendment, and that such obligation cannot be avoided by its taking reasonable measures available to it. The Company will also deliver to the Trustee, prior to the distribution of such notice, an opinion of counsel to the effect that as a result of such change or amendment the Company will be obligated to pay Additional Amounts. The Trustee will be entitled to accept such certificate and such opinion as sufficient evidence of the satisfaction of the conditions precedent contained in the second preceding sentence, in which event it will be conclusive and binding on the holders.

 

Exhibit B-2

---

9.

The Indenture contains provisions for defeasance at any time of (i) the entire indebtedness of this Note or (ii) certain covenants and Events of Default with respect to this Note, in each case upon compliance with certain conditions set forth therein.

 

10.

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

 

11.

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

 

12.

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Note is registrable in the Note Register, upon surrender of this Note for registration of transfer at the office of the Registrar, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes executed by the Company and authenticated and delivered by the Trustee, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

 

13.

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

 

14.

No service charge shall be made for any registration of transfer or exchange of Notes, but the Company, the Trustee or the Paying Agent may require (i) payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Notes, other than exchanges pursuant to Sections 3.3 (Execution, Authentication, Delivery and Dating), 3.4 (Registration, Registration of Transfer and Exchange Generally), 8.5 (Conformity with Trust Indenture Act and the Negotiable Obligations Law) or 10.11 (Redemptions and Purchases of the Notes) of the Indenture not involving any transfer and (ii) appropriate endorsements and transfer documents.

 

15.

Prior to due presentment of this Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Note is registered in the Notes Register as the owner of this Note for the purpose of receiving payment of principal of (and premium, if any) and, subject to Section 3.4 (Registration, Registration of Transfer and Exchange Generally) of the Indenture, interest on such Note and for all other purposes whatsoever, whether or not this Note be overdue, and neither the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary.

 

Exhibit B-3

---

16.

All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in the Indenture.

 

17.

THE NEGOTIABLE OBLIGATIONS LAW GOVERNS THE LEGAL REQUIREMENTS FOR THIS NOTE TO QUALIFY AS AN “OBLIGACIÓN NEGOCIABLE” THEREUNDER WHILE SUCH LAW, TOGETHER WITH ARGENTINE LAW NO. 19,550, AS AMENDED AND OTHER ARGENTINE LAWS AND REGULATIONS, GOVERN THE CAPACITY AND CORPORATE AUTHORIZATION OF THE COMPANY TO EXECUTE AND DELIVER THIS NOTE AND THE INDENTURE AND THE AUTHORIZATION OF THE CNV FOR THE PUBLIC OFFERING OF THIS NOTE IN ARGENTINA. AS TO ALL OTHER MATTERS, THE INDENTURE AND THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, UNITED STATES OF AMERICA.

 

18.

Each of the following events with respect to the Notes shall be an event of default (Events of Default) in connection with the Notes:

 

a.

default in the payment of any principal of any of the Notes when the same shall become due and payable, whether at maturity, upon redemption, by declaration, by prepayment or otherwise and such default continues for five calendar days;

 

b.

default in the payment of any interest or Additional Amounts, if applicable, when the same shall become due and payable, whether at maturity, upon redemption, by declaration, by prepayment or otherwise and such default continues for thirty (30) calendar days;

 

c.

any failure to comply with the provisions of Sections 9.16 (Limitations on Mergers, Consolidations, Sales and Conveyances);

 

d.

any failure on the part of the Company to duly observe or perform any of the covenants or agreements of the Company under the Indenture (other than those referred to in (a) and (b) above) for a period of more than 30 calendar days after the date on which written notice thereof requiring the Company to remedy the same shall have been given to the Company by the Trustee or the Holders of at least 25% in aggregate principal amount Outstanding of the Notes;

 

e.

there occurs with respect to any Indebtedness of the Company or its Restricted Subsidiaries having a principal amount of U.S. $30 million (or its equivalent in other currencies) or more in the aggregate for all such Indebtedness of all such Persons (i) an event of default that results in the acceleration of the maturity of such Indebtedness or (ii) failure to make a principal payment when due and such defaulted payment is not made, waived or extended within the applicable grace period;

 

f.

there shall have been a revocation, cancellation, termination or suspension for more than twenty (20) consecutive days of the Concession Agreement;

 

g.

there shall have been entered against the Company or any of its Restricted Subsidiaries a final judgment, decree or order by a court of competent jurisdiction from which no appeal may be taken or, within the applicable period to appeal, is taken for the payment of money, or the forfeiture of property with an aggregate value in excess of U.S. $30 million (or its equivalent in other currencies) and 60 calendar days shall have passed since the entry of the order without it being satisfied, discharged or stayed (a Judgment);

 

Exhibit B-4

---

h.

a distress, attachment, execution, seizure before judgment or other legal or extrajudicial process is levied, enforced or sued out on or against any part of the property, assets or revenues of the Company or any of its Restricted Subsidiaries, which, if executed or consummated, would have a material adverse effect on the Company’s ability to make scheduled principal and interest payments on the Notes, unless (i) such distress, attachment, execution, seizure before judgment or other legal or extrajudicial process is discharged or stayed within 90 days of notice to the Company or such Restricted Subsidiary, as the case may be, or (ii) if such distress, attachment, execution, seizure before judgment or legal or extrajudicial process shall not have been discharged or stayed within such 90-day period, the Company or such Restricted Subsidiary, as the case may be, shall have contested in good faith by appropriate proceedings such distress, attachment, execution, seizure before judgment or legal process; provided that if such distress, attachment, execution, seizure before judgment or legal process shall not have been discharged or stayed within 365 days of notice to the Company or such Restricted Subsidiary, as the case may be, the Company or such Restricted Subsidiary shall have posted a bond or other appropriate collateral which shall have substituted such distress, attachment, execution, seizure before judgment or other legal or extrajudicial process within such time period;

 

i.

the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary shall, after the Issuance Date:

 

i.

make a general assignment for the benefit of its creditors,

 

ii.

be adjudicated bankrupt or insolvent, or

 

iii.

(A) file a voluntary petition in bankruptcy or a petition or an answer seeking reorganization or an arrangement with creditors pursuant to a “concurso preventivo de acreedores,” (B) seek approval of its creditors for an “acuerdo preventivo extrajudicial” through any means, including the distribution of an offering circular or similar disclosure materials to creditors in connection with such “acuerdo preventivo extrajudicial,” (C) file for court endorsement of an “acuerdo preventivo extrajudicial,” (D) apply for or consent to the appointment (in a similar court proceeding) of a receiver, trustee, liquidator or the like for itself or its property or (E) make a similar court filing seeking to take advantage of any applicable Insolvency Law;

 

j.

after the Issuance Date and without its application, approval or consent, a proceeding shall be instituted in any court of competent jurisdiction, seeking in respect of the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary adjudication in bankruptcy, reorganization, dissolution, winding up, liquidation, a composition or arrangement with creditors, the appointment of a trustee, a receiver, liquidator or the like of the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary or of all of the assets thereof or other like relief in respect of the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary under any applicable bankruptcy or Insolvency Law, and either

 

i.

such proceeding shall not be actively contested by the Company or such Restricted Subsidiary in good faith, or

 

ii.

any order, judgment or decree shall be entered by any court of competent jurisdiction to effect any of the foregoing;

 

k.

any condemnation, seizure, compulsory purchase or expropriation, or taking into custody or control, by any governmental authority or agency of assets or share capital of the Company or its Restricted Subsidiaries which, in the aggregate, would be likely to have a material adverse effect upon the business and results of operations of the Company and its Restricted Subsidiaries taken as a whole; or

 

Exhibit B-5

---

l.

a general moratorium shall be agreed or declared in respect of the payment or performance of the obligations of the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary.

 

19.

If an Event of Default occurs and is continuing with respect to the Notes, the Trustee may and, at the direction or request of the holders of not less than 25% of the then outstanding aggregate principal amount of the Notes shall, by notice in writing to the Company, declare the principal amount of, and interest accrued on, the Notes to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable upon the date that such written notice is received by or on behalf of the Company.

 

20.

After a declaration of acceleration of the Notes, but before a judgment or decree of the money due in respect of the Notes has been obtained, the holders of not less than a majority of the then outstanding aggregate principal amount of the Notes, may rescind, by written notice to the Trustee, an acceleration and its consequences if all existing Events of Default (other than the nonpayment of principal and interest and any Additional Amounts on the Notes, which have become due solely by virtue of such acceleration) have been cured or waived and if the rescission would not conflict with any judgment or decree. No such rescission shall affect any subsequent Event of Default or impair any right consequent thereto.

 

21.

The Company covenants that if:

 

(a)

a default occurs in the payment of interest on any Note when such interest becomes due and payable and such default continues for a period of 30 days; or

 

(b)

a default occurs in the payment of the principal of (or premium, if any, on) any Note at the Maturity thereof,

 

the Company will, upon demand of the Trustee, pay to the Trustee, for the benefit of the Holders of this Note, (i) the aggregate amount then due and payable on this Note for principal (and premium, if any) and interest, (ii) to the extent that payment of default interest shall be legally enforceable, interest on any overdue principal (and premium, if any) and interest, at the default interest rate applicable to this Note, and (iii) such further amounts as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.

 

22.

If the Company fails to pay such amounts immediately upon demand, the Trustee, in its own name and as trustee of an express trust, may institute a judicial proceeding for the collection of the amounts so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Company or any other successor obligor of this Note and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Company or any other obligor of the Notes, wherever situated.

 

23.

If an Event of Default occurs and is continuing, the Trustee may, in its discretion, proceed to protect and enforce its rights and the rights of the Holders by such appropriate judicial proceedings as the Trustee shall deem most effective to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in the Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy.

 

24.

The Trustee shall not be bound to institute any proceedings or take any other actions described in the two preceding paragraphs unless (a) it shall have been so directed by the Holders of a majority in aggregate principal amount of Notes then Outstanding pursuant (and subject) to Section 5.12 (Control by Holders) of the Indenture and (b) it shall have received an indemnity satisfactory to it against the costs, expenses and liabilities to be incurred in compliance with such direction.

 

Exhibit B-6

---

25.

In case of any judicial proceeding relative to the Company (or any other obligor upon the Notes), its property or its creditors, the Trustee shall be entitled and empowered, by intervention in such proceeding or otherwise, to take any and all actions authorized under the Trust Indenture Act, the Negotiable Obligations Law and Law 24,522, as amended, in order to have claims of the Holders and the Trustee allowed in any such proceeding. In particular, the Trustee shall be authorized to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 6.7 (Compensation and Reimbursement) of the Indenture.

 

26.

No provision of the Indenture shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.

 

27.

All rights of action and claims under the Indenture or the Notes may be prosecuted and enforced by the Trustee without the possession of any of the Notes or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Notes in respect of which such judgment has been recovered.

 

28.

No Holder of any Note will have any right by virtue of or by availing itself of any provision of the Indenture or the Notes to institute any suit, action or proceeding in equity or at law, or otherwise, upon or under or with respect to the Indenture, or the Notes, or for any remedy thereunder, unless:

 

(a)

such Holder previously shall have given to the Trustee written Notice of Default and of the continuance thereof,

 

(b)

the Holders of not less than 25% of the aggregate principal amount of the Notes then Outstanding shall have made written request upon the Trustee to institute such action or proceedings in its own name as Trustee under the Indenture and shall have offered to the Trustee an indemnity satisfactory to it against the costs, expenses and liabilities to be incurred therein or thereby, and

 

(c)

the Trustee for 30 days after its receipt of such notice, request and offer of indemnity shall have failed to institute any such action or proceeding and no direction inconsistent with such written request shall have been given to the Trustee pursuant to the Indenture.

 

29.

Notwithstanding any other provision in the Indenture and any provision of this Note, the right of any Holder of any Note to receive payment of the principal of and interest on this Note (including Additional Amounts) on or after the respective due dates expressed in this Note, or to institute suit (including any “acción ejecutiva individual” pursuant to Article 29 of the Negotiable Obligations Law) for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the prior consent of such Holder. To that effect, any beneficial owner of Global Notes will have the right to obtain evidence of its beneficial ownership interest in a Global Note in accordance with Argentine Decree 677/01, as amended (including for initiating summary proceedings (acción ejecutiva) in the manner provided by the Negotiable Obligations Law), and for such purposes, such beneficial owner will be treated as the owner of that portion of the Global Note which represents its beneficial ownership interest therein.

 

30.

If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under the Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every such ease, subject to any determination in such proceeding, the Company, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.

 

Exhibit B-7

---

31.

Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes in the last paragraph of Section 3.6 (Payment of Interest; Interest Rights Preserved) of the Indenture, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

 

32.

No delay or omission of the Trustee or of any Holder of any Note to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.

 

33.

The Holders of a majority in principal amount of the Notes then Outstanding shall, upon offering to the Trustee indemnity satisfactory to it, have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee, provided that:

 

(a)

such direction shall not be in conflict with any rule of law or with the Indenture or shall not be adverse in any material respect to the Trustee; and

 

(b)

the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction; and

 

(c)

such right shall not impair the right of any individual Holder to file suits against the Company in accordance with Article 29 of the Negotiable Obligations Law.

 

34.

Subject to Section 5.2 (Acceleration of Maturity; Rescission and Annulment) of the Indenture, the Holders of not less than a majority in principal amount of the Notes then Outstanding may on behalf of the Holders of all the Notes waive any past Default hereunder and its consequences, except a Default:

 

(a)

in the payment of the principal of (or premium, if any) or interest on any Note; or

 

(b)

in respect of a covenant or provision which under Section 8.2 (Supplemental Indentures With Consent of Holders) of the Indenture cannot be modified or amended without the consent of the Holder of each Note affected.

 

35.

Upon any such waiver, such default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of the Indenture; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon.

 

36.

In any suit for the enforcement of any right or remedy under the Indenture, or in any suit against the Trustee for any action taken, suffered or omitted by it as Trustee, a court may require any party litigant in such suit to file an undertaking to pay the costs of such suit, and may assess costs against any such party litigant, in the manner and to the extent provided in the Trust Indenture Act; provided that neither this paragraph nor the Trust Indenture Act shall be deemed to authorize any court to require such an undertaking or to make such an assessment in any suit instituted by the Company or the Trustee.

 

Exhibit B-8

---

37.

To the extent that the Company or any of its revenues, assets or properties shall be entitled, with respect to any Related Proceeding any time brought against the Company or any of its revenues, assets or properties in the courts identified above, to any immunity from suit, from the jurisdiction of any such court, from attachment prior to judgment, from attachment in aid of execution of judgment, from execution of a judgment or from any other legal or judicial process or remedy, and to the extent that in any such jurisdiction there shall be attributed such an immunity, the Company has irrevocably agreed not to claim and has irrevocably waived such immunity to the fullest extent permitted by law (including, without limitation, the Foreign Sovereign Immunities Act of 1976 of the United States). The Company has agreed that final judgment in any such suit, action or proceeding brought in such a court will be conclusive and binding on it and may be enforced in any court to the jurisdiction of which the Company is subject by a suit upon such judgment; provided that service of process if effected upon the Company in the manner specified above or as otherwise permitted by law.

 

38.

The Company will not, and will not permit any of its Restricted Subsidiaries to incur, assume or suffer to exist, any Lien upon its property, assets or revenues, whether now owned or hereafter acquired, securing any Indebtedness of any Person, unless the Notes are equally and ratably secured by such Liens, other than the following (Permitted Liens):

 

(a)

Liens for taxes, assessments or governmental charges or claims or fines not yet due or which are being contested in good faith by appropriate proceedings; provided that adequate reserves with respect thereto are maintained on the books of the Company or such Restricted Subsidiary, as the case may be, to the extent required by Argentine GAAP;

 

(b)

Liens created by any Restricted Subsidiaries over their assets solely in favor of the Company or another Restricted Subsidiary;

 

(c)

deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business;

 

(d)

Liens arising by reason of (1) any judgment, decree or order of any court, so long as such Lien is being contested in good faith and any appropriate legal proceedings which may have been duly initiated for the review of such judgment, decree or order shall not have been finally terminated or the period within which such proceedings may be initiated shall not have expired; (2) any embargo preventivo or any other interlocutory or temporary attachment order or measure in connection with an action or proceeding during the pendency of such action or proceeding; (3) security for payment of workers’ compensation or other insurance or obligations arising from other social security laws; and (4) operation of law in favor of warehousemen, landlords, mechanics, material men, laborers, employees or suppliers or other similar liens imposed by law or by contract incurred in the ordinary course of business for sums which are not yet delinquent or are being contested in good faith by negotiations or by appropriate proceedings which suspend the collection thereof, and, in each case, for which adequate reserves are maintained on the books of the Company or such Restricted Subsidiary, as the case may be, to the extent required by Argentine GAAP;

 

(e)

leases or subleases granted to others, easements, rights of way, zoning and similar covenants and restrictions and other similar encumbrances or title defects, which do not materially detract from the value of the property subject thereto or materially interfere with the ordinary conduct of the business of the Company and its Restricted Subsidiaries;

 

(f)

Liens on property that secure Indebtedness Incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of such property and which attach no later than 90 days after the date of such purchase or the completion of construction or improvement; provided that no such Lien shall extend to or cover any physical assets or equipment other than the physical assets or equipment being acquired, constructed or improved;

 

Exhibit B-9

---

(g)

Liens on property at the time the Company or any of its Restricted Subsidiaries acquires such property, including any acquisition by means of a merger or consolidation of such Person with or into the Company or a Restricted Subsidiary; provided that such Liens are not created in contemplation of such acquisition and do not extend to any other property of the Company or any Restricted Subsidiary existing immediately prior to such acquisition;

 

(h)

escrow deposits, trusts or similar accounts created or established pursuant to the Restructuring Indenture, the Indenture or for the payment of debt service obligations under the Notes, including, without limitation, any deposits or accounts created and any encumbrances or interests granted in such deposits or accounts, in each case, in connection with or in furtherance of the application of the proceeds of this offering as described under “Use of Proceeds” in the Offering Memorandum;

 

(i)

any banker’s right of set-off arising from operation of law with respect to deposits made in the ordinary course of business by the Company;

 

(j)

Liens securing obligations under Hedging Contracts;

 

(k)

Liens in existence on the Issuance Date and any renewals or extensions thereof, so long as (A) such renewal or extension Lien does not extend to any property other than that originally subject to the Liens being renewed or extended and (B) the principal amount of the Indebtedness secured by such Lien, if applicable, is not increased;

 

(l)

Liens to secure any Permitted Refinancing Indebtedness which is Incurred to refinance any Indebtedness which has been secured by a Lien permitted under this paragraph; provided that such new Liens are not materially more favorable to the lienholders with respect to such Liens than the Liens in respect of the Indebtedness being refinanced, and do not extend to any property or assets other than property or assets securing the Indebtedness refinanced by such Permitted Refinancing Indebtedness;

 

(m)

Liens on Receivables and Related Assets securing Permitted Indebtedness described in Paragraph 40(h) hereof;

 

(n)

Liens arising or deemed to arise from a Sale and Leaseback Transaction;

 

(o)

Liens created or established in order to comply with any applicable rule, regulation, order, resolution, decree, directive or instruction of any federal, provincial or municipal government of Argentina, or any agency or instrumentality thereof, in connection with the conduct of a Permitted Business; and

 

(p)

Liens on any debt securities of the Company or a Restricted Subsidiary repurchased by the Company and securing Indebtedness the proceeds of which are used exclusively for the repurchase of debt securities of the Company or a Restricted Subsidiary;

 

provided that, notwithstanding the foregoing, any Lien, of any nature or source, on the concession granted pursuant to the Concession Agreement shall not be considered a Permitted Lien.

 

39.

The Company will not, and will not permit any of its Restricted Subsidiaries to, Incur any Indebtedness; provided that the Company or any Restricted Subsidiary may Incur Indebtedness if, on the date of the Incurrence, after giving effect to the Incurrence and the receipt and application of the proceeds therefrom, no Default has occurred and is continuing and the Leverage Ratio is not greater than 3.75 or less than zero and the Interest Expense Coverage Ratio is not less than 2.0.

 

Exhibit B-10

---

40.

Notwithstanding the foregoing, the Company and its Restricted Subsidiaries may Incur the following Indebtedness if, on the date of the Incurrence, after giving effect to the Incurrence and the receipt and application of the proceeds therefrom, no Default has occurred and is continuing (Permitted Indebtedness):

 

(a)

Indebtedness outstanding on the Issuance Date, including any Notes issued on the Issuance Date;

 

(b)

Permitted Refinancing Indebtedness;

 

(c)

Subordinated Indebtedness;

 

(d)

Indebtedness Incurred for purposes of, and substantially all of the proceeds of which are applied to, financing of Regulatory Capital Expenditures;

 

(e)

Indebtedness in respect of Hedging Contracts;

 

(f)

Indebtedness with respect to letters of credit, bankers’ acceptances and similar obligations issued in the ordinary course of business and not supporting Indebtedness, including performance bonds and letters of credit supporting performance bonds;

 

(g)

Indebtedness of the Company or any of its Restricted Subsidiaries owed to the Company or any of its Restricted Subsidiaries so long as such Indebtedness continues to be owed to the Company or a Restricted Subsidiary and which, if the obligor is the Company and such Indebtedness is owed to such Restricted Subsidiary, is subordinated in right of payment and priority to the Notes, pursuant to a Subordination Agreement;

 

(h)

Indebtedness under any one or more Permitted Receivables Financings, the combined aggregate principal amount of which does not exceed U.S.$35 million (or its equivalent in other currencies) at any time outstanding; and

 

(i)

Indebtedness Incurred for general corporate purposes in an aggregate principal amount not to exceed U.S. $50 million (or its equivalent in other currencies) at any time outstanding.

 

41.

The Company will not, and will not permit any of its Restricted Subsidiaries to, make any Asset Sale unless:

 

(a)

the Asset Sale is for fair market value, as determined in good faith by the Board of Directors;

 

(b)

at least 75% of the value of the consideration therefrom is in the form of Cash and Cash Equivalents; provided that (i) any non-cash consideration received is for fair market value and (ii) the receipt of such non-cash consideration is otherwise permitted under the Indenture; and

 

(c)

immediately before and immediately after giving effect to such Asset Sale, no Default or Event of Default shall have occurred and be continuing.

 

Exhibit B-11

---

42.

Within 270 days after the receipt of any Net Cash Proceeds from an Asset Sale (other than a Sale and Leaseback Transaction), the Company or any Restricted Subsidiary shall, at its election, apply the Net Cash Proceeds of such Asset Sale to (i) purchase, prepay or redeem Indebtedness of the Company or any Restricted Subsidiary or (ii) (A) acquire or commit to acquire all or substantially all of the assets of a Permitted Business or a majority of the Voting Stock of another Person that thereupon becomes a Restricted Subsidiary engaged in a Permitted Business; or (B) acquire or commit to acquire assets that are to be used by the Company or a Restricted Subsidiary in a Permitted Business; provided that if the Company receives Net Cash Proceeds from Asset Sales in an aggregate amount in excess of U.S. $20 million in any fiscal year, the Company shall apply such excess, to the extent not otherwise applied as permitted in this paragraph within the following fiscal year, for the purposes set forth in clauses (i) or (ii) above.

 

The Company or any Restricted Subsidiary shall apply the Net Cash Proceeds of any Sale and Leaseback Transaction as set forth in clauses (i) or (ii)(B) in the immediately preceding paragraph.

 

43.

The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, enter into, renew or extend any transaction or arrangement including the purchase, sale, lease or exchange of property or assets, or the rendering of any service, with any Affiliate of the Company (other than Sociedad Anónima Centro de Movimiento de Energía (SACME)) except upon terms not less favorable to the Company or such Restricted Subsidiary than those that could be obtained in a comparable arm’s-length transaction with a Person that is not an Affiliate of the Company.

 

44.

If any such transaction or series of related transactions has an aggregate value in excess of U.S. $10 million, prior to such transaction, the Company will obtain a favorable written opinion from (i) the audit committee of the Company, which committee shall include at least two independent members of the Board of Directors and (ii) at least one independent consultant that the terms of the transaction are consistent with those that could be obtained in a comparable arm’s-length transaction with a Person that is not an Affiliate of the Company.

 

45.

Paragraphs 51 and 52 do not apply to:

 

(a)

any transaction between the Company and any of its Restricted Subsidiaries or between Restricted Subsidiaries of the Company;

 

(b)

any transaction or payment required pursuant to Argentine laws and regulations to be made on terms different than in comparable arm’s-length transactions;

 

(c)

any payments made pursuant to the Technical Assistance Agreement, dated September 15, 2005, between EDF and the Company, or pursuant to a technical service or operating agreement with the then current strategic operator on or prior to the fifth anniversary of the Issuance Date (or later, if the Company is required under any applicable rules or regulations or by any relevant authorities to engage a strategic operator after such fifth anniversary); in an aggregate amount not to exceed U.S. $2.0 million (or its equivalent in other currencies), net of withholding taxes, in any fiscal year;

 

(d)

any payments to Electricidad Argentina S.A. (EASA) in an aggregate amount (including, but not limited to, withholding taxes, but net of value added taxes) not to exceed U.S. $2.5 million (or its equivalent in other currencies) in any fiscal year; or

 

(e)

the performance by any of the Company or its Restricted Subsidiaries of its obligations under the terms of any modification or replacement of such agreement in effect on the Issuance Date and disclosed in the Offering Memorandum under the heading “Related Party Transactions.”

 

46.

The Company will not and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, take any of the following actions (each, a Restricted Payment):

 

Exhibit B-12

---

(a)

declare or pay any dividend or return of capital or make any distribution on or in respect of Equity Interests of the Company or any Restricted Subsidiary to Holders of such Equity Interests other than (i) any dividends or distributions in the form of Qualified Equity Interests of the Company, (ii) dividends, distributions or returns of capital payable to the Company or a Restricted Subsidiary, (iii) dividends, distributions or returns of capital made on a pro rata basis to the Company and its Restricted Subsidiaries on the one hand, and minority Holders of Equity Interests of a Restricted Subsidiary on the other hand or (iv) any payments permitted to be made pursuant to Section 9.4 (Limitation on Transactions with Shareholders and Affiliates) of the Indenture;

 

(b)

purchase, redeem or otherwise acquire or retire for value any Equity Interests of the Company;

 

(c)

repay, redeem, repurchase, defease or otherwise acquire or retire for value, or make any payment on or with respect to, any Subordinated Indebtedness, other than (i) scheduled payments of interest or principal (provided no Default or Event of Default shall have occurred and be continuing), (ii) any intercompany Indebtedness between or among the Company and/or any Restricted Subsidiaries or (iii) any payments permitted to be made pursuant to Section 9.4 (Limitation on Transactions with Shareholders and Affiliates) of the Indenture; or

 

(d)

make any Investments (other than Permitted Investments);

 

unless, at the time of, and after giving affect to, the proposed Restricted Payment.

 

47.

The Company will furnish to the Trustee:

 

(a)

as soon as available, but in any event within 120 days after the end of each fiscal year (December 31) of the Company, a copy of the consolidated balance sheet of the Company as of the end of such year and the related consolidated statements of income and cash flows for such fiscal year, audited by independent accountants selected by the Company and of internationally recognized standing;

 

(b)

as soon as available, but in any event within 75 days after the end of each of the first three fiscal quarters of the Company, a copy of the unaudited consolidated balance sheet of the Company as of the end of each such quarter and the related unaudited consolidated statements of income and cash flows of the Company for such quarter and the portion of the fiscal year through such date; and

 

(c)

concurrently with the delivery of the financial statements for each fiscal year and the second fiscal quarter of the Company referred to in clauses (a) and (b), respectively above, a certificate of the Company’s general manager or Chief Financial Officer certifying the calculation of the Leverage Ratio and the Interest Expense Coverage Ratio; and

 

(d)

concurrently with the delivery of the financial statements referred to in clause (a) above, a certificate of the general manager or chief financial officer of the Company stating (i) whether, to the best of such officer’s knowledge, anything came to his or her attention to cause him or her to believe that there existed on the date of such statements a Default or an Event of Default, and if so, specifying the nature and period of existence thereof.

 

Exhibit B-13

---

All of the financial statements referred to in (a) and (b) above are to be complete and correct in all material respects, to be prepared in reasonable detail and in accordance with Argentine GAAP applied consistently throughout the periods reflected therein and to be delivered in both the English and Spanish languages.

 

48.

Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such reports shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers’ Certificates).

 

49.

The Company will use reasonable efforts to notify the Trustee by facsimile or electronic mail (receipt confirmed telephonically or by electronic mail or electronic mail receipt) promptly after it becomes aware of the occurrence of any Event of Default, or any condition or event which with the giving of notice, lapse of time or satisfaction of any other condition or any combination of the foregoing would, unless cured or waived, become an Event of Default. Each notice given pursuant to this paragraph shall be accompanied by a certificate of an Officer of the Company setting forth the details of the occurrence referred to therein and stating what action the Company proposes to take with respect thereto.

 

50.

The Company will use its reasonable best efforts to obtain and maintain a listing on the Buenos Aires Stock Exchange, the admission to trading on the ▇▇▇▇▇▇▇ Abierto Electrónico S.A., a listing on the Luxembourg Stock Exchange and the admission to trading on the Euro MTF market of the Luxembourg Stock Exchange. In the event that the Notes are admitted to trading on Euro MTF, the Company will use commercially reasonable efforts to maintain such listing; provided that the Company may terminate such listing and delist the Notes from Euro MTF if it determines that the provisions of the European Transparency Obligations Directive (2003/2004/COD) or other applicable legislation becomes unduly onerous or burdensome, in which case the Company will use commercially reasonable efforts to obtain an alternative admission to listing, trading and/or quotation for the Notes by another listing authority, exchange and/or system within or outside the European Union, as it may decide and to the extent feasible.

 

51.

Except as otherwise permitted under the Indenture and referred to below under Section 9.16 (Limitations on Mergers, Consolidations, Sales and Conveyances) of the Indenture, the Company, at all times, will do all things necessary to preserve and keep in full force and effect its corporate existence and preserve and keep in full force and effect in all respects all material licenses and permits necessary to the proper conduct of its business and its rights (charter and statutory) and franchises and such rights and franchises of its Restricted Subsidiaries necessary to the proper conduct of the business of the Company and such Subsidiaries, as a whole.

 

52.

The Company and its Restricted Subsidiaries will not engage in any business other than a Permitted Business.

 

53.

The Company will cause all material tangible properties used in the conduct of its business or the business of any of its Significant Subsidiaries to be maintained and kept in good condition, repair and working order and supplied with all necessary equipment and will cause to be made all necessary repairs, renewals, replacements and improvements thereof, all as in the Company’s judgment may be necessary so that the business carried on in connection therewith may be properly and advantageously conducted at all times; provided, however, that this covenant will not prevent the Company or any of its Subsidiaries from discontinuing the operation or maintenance of any of such properties if such discontinuance is desirable in the conduct of its business and the business of its Subsidiaries taken as a whole and not adverse in any material respect to the holders of the Notes.

 

54.

The Company will, and will cause each of its Subsidiaries to, maintain insurance in such amounts and covering such risks as is usually carried by electricity distribution companies, subject to any applicable laws and regulations of Argentina.

 

Exhibit B-14

---

55.

The Company will, and will cause each of its Subsidiaries to, pay or discharge or cause to be paid or discharged, before the same shall become delinquent, all taxes, assessments and governmental charges levied or imposed upon the Company or its Subsidiaries; provided, however, that neither the Company nor any Subsidiary will be required to pay or discharge or cause to be paid or discharged any such tax, assessment, charge or claim which is being contested in good faith and, if appropriate, by appropriate legal proceedings, provided that adequate reserves with respect thereto are maintained on the books of the Company or such Subsidiary, as the case may be, to the extent required by Argentine GAAP.

 

56.

The Company may designate any Subsidiary, including a newly acquired or created Subsidiary, to be an Unrestricted Subsidiary under the Indenture if:

 

(a)

the Restricted Subsidiary is not a Significant Subsidiary;

 

(b)

no Default or Event of Default shall have occurred and be continuing at the time of and after giving effect to such designation;

 

(c)

such Subsidiary does not own any Capital Stock of the Company or any Restricted Subsidiary or hold any Indebtedness of, or any Lien on any property of, the Company or any Restricted Subsidiary; and

 

(d)

the Subsidiary is not party to any transaction or arrangement with the Company or any Restricted Subsidiary that would not be permitted under Section 9.4 (Limitation on Transactions with Shareholders and Affiliates) of the Indenture.

 

If the Subsidiary being designated as an Unrestricted Subsidiary is, at the time of designation, a Restricted Subsidiary, the consequences set forth in paragraph (c) apply. Once so designated, the Subsidiary will remain an Unrestricted Subsidiary, subject to paragraph (b).

 

57.

(a)  A Subsidiary previously designated an Unrestricted Subsidiary which fails to meet the qualifications set forth in paragraph 66 above will be deemed to become at that time a Restricted Subsidiary, subject to the consequences set forth in paragraph 69.

 

(b)

the Company may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if the designation would not cause a Default.

 

58.

Upon a Restricted Subsidiary becoming an Unrestricted Subsidiary:

 

(a)

all existing Investments of the Company and the Restricted Subsidiaries therein valued at the Company’s proportional share of the fair market value of its assets less liabilities will be deemed made at that time;

 

(b)

all existing Indebtedness of the Company or a Restricted Subsidiary held by it will be deemed incurred at that time, and all Liens on property of the Company or a Restricted Subsidiary held by it will be deemed incurred at that time;

 

(c)

all existing transactions between it and the Company or any Restricted Subsidiary will be deemed entered into at that time; and

 

(d)

it will cease to be subject to the provisions of the Indenture and the Notes as a Restricted Subsidiary.

 

59.

Upon an Unrestricted Subsidiary becoming, or being deemed to become, a Restricted Subsidiary:

 

(a)

all of its Indebtedness and Disqualified Stock will be deemed incurred at that time for purposes of Section 9.2 (Limitations on Indebtedness) of the Indenture;

 

Exhibit B-15

---

(b)

Investments therein previously charged under Section 9.5 (Limitation on Restricted Payments) of the Indenture, as adjusted to reflect any change in the Company’s proportional share of the fair market value of its assets less liabilities, will be credited thereunder; and

 

(c)

it will thenceforward be subject to the provisions of the Indenture and the Notes as a Restricted Subsidiary.

 

Any designation by the Company of a Subsidiary as a Restricted Subsidiary or Unrestricted Subsidiary shall, unless so noted by the Company, be deemed to include the designation of all of the Subsidiaries of such Subsidiary. Any designation by the Company of a Subsidiary as a Restricted Subsidiary or Unrestricted Subsidiary will be evidenced to the Trustee by delivering to the Trustee a copy of the resolutions of the Board of Directors giving effect to the designation and an Officers’ Certificate certifying that the designation complied with the foregoing provisions, not later than the next succeeding delivery of financial statements as required under Section 9.6 (Delivery of Financial Statements) of the Indenture.

 

60.

Notwithstanding the foregoing, the obligations of the Company and its Restricted Subsidiaries to comply with the covenants described above under the Sections 9.2 (Limitations on Indebtedness), 9.3 (Limitations on Asset Sales) and 9.5 (Limitation on Restricted Payments) (collectively, the Suspended Covenants) will be suspended and cease to have any further effect during the period (the Suspended Period) from and after the first date that either (a) the Company attains from at least one of the Rating Agencies, a rating on its long-term debt denominated in currencies other than pesos that is Investment Grade or (b) the Leverage Ratio (as certified by the Company’s auditors) is equal to or lower than 2.5 and until, as applicable, the date (the Reversion Date) on which either (i) none of the Rating Agencies provide the Company’s non-Peso denominated long-term debt an Investment Grade rating or (ii) the Leverage Ratio is greater than 2.5. On the Reversion Date, the Company and its Restricted Subsidiaries’ obligation to comply with the Suspended Covenants shall be reinstated; provided, however, that the Suspended Covenants will not be of any effect with regard to actions of the Company or its Restricted Subsidiaries taken during the Suspension Period, and no Event of Default will be deemed to have occurred as a result of a failure to comply with the Suspended Covenants during the Suspension Period.

 

61.

On the Reversion Date, all Indebtedness incurred while the Suspended Covenants were suspended will be classified to have been incurred pursuant to one of the paragraphs set forth in Section 9.2 (Limitations on Indebtedness) of the Indenture (to the extent such Indebtedness would be permitted to be incurred thereunder as of the Reversion Date and after giving effect to Indebtedness outstanding on the Reversion Date). To the extent such Indebtedness would not be so permitted to be incurred pursuant to Section 9.2 (Limitations on Indebtedness) of the Indenture such Indebtedness will be deemed to have been outstanding on the Issuance Date, so that it is classified as permitted under paragraph (a) of Section 9.2 (Limitations on Indebtedness) of the Indenture.

 

62.

The Company will not enter into any merger, consolidation, spin-off or reorganization with any Person (whether or not the Company is the surviving or continuing Person) or sell, assign, transfer or otherwise convey or dispose of all or substantially all of its and its Restricted Subsidiaries’ assets, taken as a whole, whether by one transaction or a series of transactions, to any Person unless:

 

(a)

the surviving or transferee Person (if not the Company) is a sociedad anónima organized under the laws of Argentina;

 

(b)

the surviving or transferee Person (if not the Company) shall have expressly assumed, by a document executed and delivered to the Trustee in form and substance reasonably satisfactory to the Trustee, all of the obligations of the Company under the Notes and the Indenture;

 

Exhibit B-16

---

(c)

immediately after giving effect to such transaction or series of transactions on a pro forma basis, (A) no Default or Event of Default shall have occurred and be continuing, and (B) the Leverage Ratio of the Company or such surviving entity will be equal to or lower than the Leverage Ratio of the Company immediately prior to such transaction, as certified by the Company’s auditors;

 

(d)

the rating of the Notes by any Rating Agency shall not have been downgraded as a result of such transaction or series of transactions within sixty (60) days of the public announcement of such transaction or series of transactions; and

 

(e)

the surviving or transferee Person shall have delivered to the Trustee an Officers’ Certificate stating that such merger, consolidation, sale, assignment, transfer or other conveyance or disposition complies with this covenant and the Indenture.

 

63.

Upon the occurrence of any of the transactions permitted by the preceding paragraph, the surviving or transferee Person (if not the Company) will succeed to and become substituted for the Company, and may exercise every right and power of the Company, with the same effect as if it had been named in the Notes and the Indenture. Following such transaction, the Company will be released from its liability as obligor on the Notes and under the Indenture.

 

64.

In the event of any such sale, assignment, transfer, conveyance or disposition, the Company, as the predecessor entity, may be dissolved, wound-up or liquidated at any time thereafter.

 

65.

All payments of principal, premium or interest by the Company in respect of the Notes will be made without deduction or withholding for or on account of any present or future taxes, penalties, fines, duties, assessments or other governmental charges of whatever nature imposed or levied by or on behalf any Argentine Tax Jurisdiction (Argentine Taxes), unless the Company is compelled by law to deduct or withhold such Argentine Taxes. In any such event, the Company will pay such additional amounts (Additional Amounts) in respect of Argentine Taxes as may be necessary to ensure that the amounts received by holders and beneficial owners of such Notes after such withholding or deduction will equal the respective amounts that would have been received in respect of such Notes in the absence of such withholding or deduction, except that no such Additional Amounts will be payable:

 

a.

to or on behalf of a holder or beneficial owner of a Note that is liable for Argentine Taxes in respect of such Note by reason of having a present or former connection with an Argentine Tax Jurisdiction other than merely the holding or owning of such Note or the enforcement of rights with respect to such Note or the receipt of income or any payments in respect thereof;

 

b.

to or on behalf of a holder or beneficial owner of a Note in respect of Argentine Taxes that would not have been imposed but for the failure of the holder or beneficial owner of a Note to comply with any certification, identification, information, documentation or other reporting requirement (within 45 calendar days following a written request from the Company to the holder or beneficial owner, as applicable, for compliance) if such compliance is required by applicable law, regulation, administrative practice or an applicable treaty as a precondition to exemption from, or reduction in the rate of deduction or withholding of, Argentine Taxes; to or on behalf of a holder or beneficial owner of a Note in respect of any estate, inheritance, gift, sales, transfer, personal assets or similar tax, assessment or other governmental charge;

 

c.

to or on behalf of a holder or beneficial owner of a Note in respect of any estate, inheritance, gift, sales, transfer, personal assets or similar tax, assessment or other governmental charge;

 

d.

to or on behalf of a holder or beneficial owner of a Note in respect of Argentine Taxes payable otherwise than by withholding from payment of principal of, premium, if any, or interest on the Notes;

 

Exhibit B-17

---

e.

to or on behalf of a holder or beneficial owner of a Note in respect of any Taxes that are imposed on a payment to an individual and are required to be made pursuant to European Council Directive 2003/48/E on the taxation of savings income or any other directive implementing the conclusions of the ECOFIN Council meetings of November 26 and 27, 2000, December 13, 2001, and January 21, 2003, or any law implementing or complying with, or introduced in order to conform to, such a directive;

 

f.

to or on behalf of a holder or beneficial owner of a Note in respect of any Taxes that would not have been imposed if presentation for payment of the relevant notes had been made to a paying agent other than the paying agent to which the presentation was made;

 

g.

to or on behalf of a holder or beneficial owner of a Note in respect of Argentine Taxes that would not have been imposed but for the fact that the holder presented such Note for payment (where presentation is required) more than 30 days after the later of

 

i.

the date on which such payment became due and

 

ii.

if the full amount payable has not been received by the Trustee on or prior to such due date, the date on which, the full amount having been so received,

 

notice to that effect will have been given to the holders by the Trustee; or

 

h.

any combination of items (a) to (g) above;

 

nor will Additional Amounts be paid with respect to any payment of the principal of, or any premium or interest on, any Notes to any Holder or beneficial owner of a Note who is a fiduciary or partnership or limited liability company or other than the sole beneficial owner of such payment to the extent such payment would be required by the laws of an Argentine Tax Jurisdiction to be included in the income for tax purposes of a beneficiary or settlor with respect to such fiduciary or a member of such partnership, limited liability company or beneficial owner who would not have been entitled to such Additional Amounts had it been the holder of such Notes.

 

66.

The Company will pay any present or future stamp, issue, registration, court, documentation, excise or other similar taxes, charges and duties, including interest and penalties with respect thereto, imposed by any Argentine Tax Jurisdiction in respect of the execution, issue, registration or delivery of the Notes or any other document or instrument referred to hereunder and any such taxes, charges or duties imposed by any jurisdiction as a result of, or in connection with, the enforcement of the Notes and/or any other such document or instrument.

 

67.

The Company covenants that if the Company or the Trustee or any Paying Agent is required by law to make any deduction or withholding on payments of principal of or interest on the Notes for or on account of any Argentine tax, duty, assessment or other governmental charge, the Company shall, at least 10 Business Days prior to the first payment on which such deduction or withholding is applicable, (and at least 10 Business Days prior to each succeeding payment date or any redemption date or maturity date if there has been any change with respect to the matters set forth in the below-mentioned Officer’s Certificate) deliver to the Trustee (with a copy to any other Paying Agent) an Officer’s Certificate specifying the amount so required to be deducted or withheld and certifying that the Company shall pay such deduction or withholding.

 

68.

The Company hereby covenants to indemnify the Trustee (and each other Paying Agent) for, and to hold the Trustee harmless against any loss, liability or expense incurred without negligence or bad faith on the Trustee’s part arising out of actions taken or omitted by any of them in reliance on any Officer’s Certificate furnished pursuant to this Section or the failure of the Trustee to receive on a timely basis such Officer’s Certificate or any information or documentation requested by it or otherwise required by applicable laws or regulations to be obtained, furnished or filed in respect of any tax, duty, assessment or other governmental charge pursuant to the foregoing provisions of Section 9.17 (Payment of Additional Amounts) of the Indenture.

 

Exhibit B-18

---

69.

The indemnification obligations of the Company under Section 9.17 (Payment of Additional Amounts) of the Indenture shall survive the payment of the Notes, the termination of the Indenture and the resignation or removal of the Trustee.

 

70.

If the Company shall at any time act as its own Paying Agent, it will, on or before each payment date of the principal of (and premium, if any) or interest on any of the Notes, segregate and hold in trust for the benefit of the Persons entitled to such payment a sum sufficient to pay the principal (and premium, if any) or interest due until such sums shall he paid to such Persons or otherwise disposed of as herein provided and will promptly notify the Trustee of its action or failure so to act.

 

71.

Whenever the Company shall have one or more Paying Agents, it will, prior to each payment date of the principal of (and premium, if any) or interest on any Notes, deposit with a Paying Agent a sum sufficient to pay such amount, such sum to be held as provided by the Trust Indenture Act, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act. Principal and interest shall be considered paid on the date due if on such date the Trustee or Paying Agent (other than the Company or an Affiliate of the Company) holds in accordance with the Indenture U.S. Dollars designated for and sufficient to pay all principal and interest then due and the Trustee or the Paying Agent, as the case may be, is not prohibited from paying such money to the Holders on that date pursuant to the terms of the Indenture.

 

72.

The Company will cause each Paying Agent, other than the Trustee, to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of Section 9.18 (Money for Note Payments to be Held in Trust) of the Indenture, that such Paying Agent will:

 

(a)

hold all sums held by it for the payment of the principal of (and premium, if any) or interest, or any other amounts due on Notes, in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided;

 

(b)

give the Trustee notice of any default by the Company (or any other obligor upon the Notes) in the making of any payment of principal (and premium, if any) or interest or any other amounts due on the Notes; and

 

(c)

at any time during the continuance of any such default, upon the written request of the Trustee, immediately pay to the Trustee all sums so held in trust by such Paying Agent.

 

73.

The Company may at any time, for the purpose of obtaining the satisfaction and discharge of the Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same term as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such money.

 

74.

Any money deposited with the Trustee or any Paying Agent, or held by the Company, in trust for the payment of the principal of (and premium, if any) or interest on any Note which remains unclaimed for three years after such principal (and premium, if any) or interest has become due and payable shall be paid to the Company on Company Request, or (if then held by the Company) shall be discharged from such trust; and the Holder of this Note shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in a newspaper customarily published on each Business Day and of general circulation in the city of Buenos Aires, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Company.

 

Exhibit B-19

---

75.

Claims filed in Argentina courts against the Company for payment of principal in respect of the Notes (including Additional Amounts), including actions to enforce judgments obtained from a New York court, shall be prescribed unless made within ten years of the due date for payment of such principal. Claims for the payment of interest, including actions to enforce judgments obtained from a New York court, shall be prescribed unless made within four years of the due date for payment of such interest..

 

76.

Claims filed in the courts of the State of New York will be subject to the applicable statute of limitations for such claims.

 

77.

In the event of any foreign exchange restriction or prohibition in Argentina, the Company shall make any and all payments of any Note in U.S. Dollars to be made outside Argentina by:

 

(a)

purchasing, with pesos, “Bonos Externos Globales de la República Argentina” issued by Argentina and payable in Dollars or any other public or private securities issued in Argentina and denominated in U.S. Dollars, or any other securities (collectively, the Securities) and selling such instruments outside Argentina for U.S. Dollars; or

 

(b)

any other legal mechanism for the acquisition of U.S. Dollars in any exchange market.

 

(c)

In addition, in the event of any foreign exchange restriction or prohibition in Argentina, any Holder of Notes may, to the extent legally permitted, elect to receive the payment in an amount equivalent to the Peso amount necessary for purchasing Securities and the reasonable and customary cost of transferring and selling such Securities outside Argentina for U.S. Dollars in an amount equivalent to the sums due and payable under the Notes. Such payment will discharge and satisfy the Company’s payment obligations to such Holders on such payment date. In each case, all reasonable and customary costs, including any taxes, relative to such operations to obtain foreign currency will be borne by the Company.

 

(d)

In addition, in the event of any restriction or prohibition in Argentina to pay in foreign currency any obligations under the Notes to any Holder of Notes that is a resident in Argentina, the Company shall make its best efforts to obtain the corresponding authorization of the Central Bank to make such payments in U.S. Dollars. However, if such authorization cannot be obtained after reasonable attempts, the Company shall pay such Holder the Peso equivalent amount of the foreign currency amount due on the relevant payment date, or to the extent the Depositary or its nominee, as the Holder of Notes, does not accept Pesos, then we will make such payments of Peso equivalents directly to the Depositary participants holding a beneficial interest in the Notes.

 

(e)

Such payments in Pesos will be calculated using the U.S. $/ Peso exchange rate quoted by Reuters Screen “ARSVH=” ASK SIDE (Valor ▇▇▇ ▇▇▇▇▇▇▇) at 12:00 p.m. New York City time on the payment date; provided that (i) if the U.S. $/ Peso exchange rate does not appear on such Reuters Screen, the U.S. $/ Peso exchange rate shall mean, with respect to the payment date, the U.S. $/ Peso exchange rate which appears on Bloomberg L.P. (Bloomberg Screen (ARS currency)-ASK SIDE-PCS Composite (NY)) at 12:00 p.m. New York City time on such payment date. Such payment in Pesos will fully discharge and satisfy the Company’s payment obligation to such holder on the payment date and shall not constitute an Event of Default.

 

Exhibit B-20

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78.

Any suit, action or proceeding against the Company or its properties, assets or revenues with respect to the Notes or the Indenture (a Related Proceeding) may be brought in the Supreme Court of the State of New York, County of New York, or in the United States District Court for the Southern District of New York, or in the courts of Argentina that sit in the City of Buenos Aires, or in accordance with the provisions of Section 38 of Decree No. 677/2001, as the person bringing such Related Proceeding may elect in its sole discretion. The Company has consented to the non-exclusive jurisdiction of each such court for the purpose of any Related Proceeding and has irrevocably waived any objection to the laying of venue of any Related Proceeding brought in any such court and to the fullest extent it may effectively do so and the defense of an inconvenient forum to the maintenance of any Related Proceeding or any such suit, action or proceeding in any such court.

 

79.

The Company has agreed that service of all writs, claims, process and summonses in any Related Proceeding brought against it in the State of New York may be made upon CT Corporation System (the Process Agent), and the Company irrevocably appointed the Process Agent as its agent and true and lawful attorney in fact in its name, place and stead to accept such service of any and all such writs, claims, process and summonses, and has agreed that the failure of the Process Agent to give any notice to it of any such service of process shall not impair or affect the validity of such service or of any judgment based thereon. The Company has agreed to maintain at all times an agent with offices in New York City to act as its Process Agent. Nothing in the Indenture shall in any way be deemed to limit the ability to serve any such writs, process or summonses in any other manner permitted by applicable law.

 

80.

The Company irrevocably waives trial by jury in any legal action or proceeding relating to the Indenture or the Notes.

 

81.

The Company will ensure that its obligations under the Notes will at all times constitute direct, unconditional and unsubordinated obligations of the Company ranking at least pari passu in priority of payment, in right of security upon liquidation and in all other respects among themselves and with all other unsecured indebtedness of the Company now or hereafter outstanding, except to the extent that such other indebtedness may be preferred by mandatory provisions of applicable law or subordinated by its terms.

 

82.

As used herein,

 

Business Day means any day except a Saturday, Sunday or other day on which commercial banks are authorized or required by law or regulation to close in New York City or in the city of Buenos Aires.

 

CNV means Comisión Nacional de Valores (the Argentine National Securities Commission).

 

Default means any event that, with giving of any notice, the passage of time, or both, would be an Event of Default.

 

Defaulted Interest means any interest on any Note which is payable but is not punctually paid or duly provided for on any Interest Payment Date.

 

Interest Payment Date means April 9 and October 9 of each year, commencing on the first such date to occur after the Issuance Date; provided that if any Interest Payment Date would fall on a day other than a Business Day, such Interest Payment Date shall be the next succeeding Business Day with the same force and effect as if made on such April 9 or October 9, as applicable, with no accrual of interest for the period between such date and such immediately succeeding Business Day.

 

Interest Period means, (a) initially, the period commencing on (and including) the Issuance Date and ending on (but excluding) the first Interest Payment Date and (b) thereafter, each subsequent period commencing on (and including) the last day of the immediately preceding Interest Period and ending on (but excluding) the next Interest Payment Date.

 

Issuance Date means the date of original issuance of the Notes under the Indenture.

Exhibit B-21

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Offering Memorandum means the final offering memorandum relating to the Notes dated October 1, 2007.

 

Record Date means the end of business on the fifteenth day preceding the applicable Interest Payment Date, whether or not such day is a Business Day; provided that in the event the first Interest Payment Date occurs less than fifteen days after the Issuance Date, the Record Date shall mean the date on or prior to the Issuance Date which shall be specified by the Company.

 

Restructuring Indenture means the indenture, dated as of April 24, 2006, among the Company and The Bank of New York, as Trustee, Co-Registrar and Paying Agent, and Banco Río de la Plata S.A. as Registrar, Transfer and Paying Agent in Argentina and Representative of the Trustee in Argentina.

 

Special Record Date for the payment of any Defaulted Interest means a date fixed by the Trustee pursuant to Section 3.6 (Payment of Interest; Interest Rights Preserved) of the Indenture.

Exhibit B-22

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ANNEX A

 

FORM OF REGULATION S CERTIFICATE

 

(For transfers pursuant to Section 3.4(b)(i), (iii) and (v) of the Indenture)

 

The Bank of New York

▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇ ▇▇▇▇

▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ 10286

Attn: Corporate Trust Administration—Global Finance Unit

 

Re:          U.S. $220,000,000 10.5% Notes due October 9, 2017 (the Notes)

 

Reference is made to the Indenture, dated October 9, 2007 (the Indenture), between the Company and The Bank of New York, as Trustee. Terms used herein and defined in the Indenture or in Regulation S or Rule 144 under the U.S. Securities Act of 1933, as amended (the Securities Act) are used herein as so defined.

 

This certificate relates to U.S. $               principal amount of Notes, which are evidenced by the following certificate(s) (the Specified Notes):

 

COMMON CODE No(s).

ISIN No(s).

CERTIFICATE No(s).

 

The person in whose name this certificate is executed below (the Undersigned) hereby certifies that either (i) it is the sole beneficial owner of the Specified Notes, (ii) it is acting on behalf of all the beneficial owners of the Specified Notes and is duly authorized by them to do so or (iii) it is the Holder of a Global Note and has received a certification to the effect set forth below. Such beneficial owner or owners are referred to herein collectively as the “Owner”. If the Specified Notes are not represented by a Global Note, they are registered in the name of the Undersigned, as or on behalf of the Owner.

 

The Owner has requested that the Specified Notes be transferred to a person (the Transferee) who will take delivery in the form of a Regulation S Note. In connection with such transfer, the Owner hereby certifies or has certified that, unless such transfer is being effected pursuant to an effective registration statement under the Securities Act, it is being effected in accordance with Rule 904 of Regulation S or Rule 144 under the Securities Act and with all applicable securities laws of the states of the United States and other jurisdictions. Accordingly, the Owner hereby further certifies or has certified as follows:

Annex A-1

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(1) Rule 904 Transfers

 

If the transfer is being effected in accordance with Rule 904 of Regulation S:

 

(A) the Owner is not a distributor of the Notes, an affiliate of the Company or any such distributor or a person acting on behalf of any of the foregoing;

 

(B) the offer of the Specified Notes was not made to a person in the United States;

 

(C) either:

 

(i)

at the time the buy order was originated, the Transferee was outside the United States or the Owner and any person acting on its behalf reasonably believed that the Transferee was outside the United States, or

 

(ii)

the transaction is being executed in, on or through the facilities of the Eurobond market, as regulated by the International Notes Market Association or another designated offshore Notes market and neither the Owner nor any person acting on its behalf knows that the transaction has been prearranged with a buyer in the United States;

 

(D)

no directed selling efforts have been made in the United States by or on behalf of the Owner or any affiliate thereof; and

 

(E)

the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act.

 

(2) Rule 144 Transfers

 

If the transfer is being effected pursuant to Rule 144:

 

(A)

the transfer is occurring after October 9, 2008 and is being effected in accordance with the applicable amount, manner of sale and notice requirements of Rule 144; or

 

(B)

the transfer is occurring after October 9, 2009, and the Owner is not, and during the preceding three months has not been, an affiliate of the Company.

 

This certificate and the statements contained herein are made for your benefit and the benefit of the Company.

 

Dated:

	(Print the name of the Undersigned, as such term is defined in the second paragraph of this certificate.)
	By:
		Name:
		Title:
	(If the Undersigned is a corporation, partnership or fiduciary, the title of the person signing on behalf of the Undersigned must be stated.)

 

Annex A-2

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ANNEX B

 

FORM OF RESTRICTED NOTES CERTIFICATE

 

(For transfers pursuant to Section 3.4(b)(ii), (iii) and (v) of the Indenture)

 

The Bank of New York

▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇ ▇▇▇▇

▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ 10286

Attn: Corporate Trust Administration—Global Finance Unit

 

Re:          U.S. $220,000,000 10.5% Notes due October 9, 2017 (the Notes)

 

Reference is made to the Indenture, dated October 9, 2007 (the Indenture), between the Company and The Bank of New York, as Trustee. Terms used herein and defined in the Indenture or in Regulation S or Rule 144 under the U.S. Securities Act of 1933, as amended (the Securities Act) are used herein as so defined.

 

This certificate relates to U.S. $                principal amount of Notes, which are evidenced by the following certificate(s) (the Specified Notes):

 

COMMON CODE No(s).

ISIN No(s).

CERTIFICATE No(s).

The person in whose name this certificate is executed below (the Undersigned) hereby certifies that either (i) it is the sole beneficial owner of the Specified Notes, (ii) it is acting on behalf of all the beneficial owners of the Specified Notes and is duly authorized by them to do so or (iii) it is the Holder of a Global Note and has received a certification to the effect set forth below. Such beneficial owner or owners are referred to herein collectively as the Owner. If the Specified Notes are not represented by a Global Note, they are registered in the name of the Undersigned, as or on behalf of the Owner.

 

The Owner has requested that the Specified Notes be transferred to a person (the Transferee) who will take delivery in the form of a Restricted Note. In connection with such transfer, the Owner hereby certifies or has certified that, unless such transfer is being effected pursuant to an effective registration statement under the Securities Act, it is being effected in accordance with Rule 144A or Rule 144 under the Securities Act and all applicable securities laws of the states of the United States and other jurisdictions. Accordingly, the Owner hereby further certifies or has certified that:

 

(l) Rule 144A Transfers

 

If the transfer is being effected in accordance with Rule 144A:

 

(A)

the Specified Notes are being transferred to a person that the Owner and any person acting on its behalf reasonably believe is a “qualified institutional buyer” within the meaning of Rule 144A, acquiring for its own account or for the account of a qualified institutional buyer; and

 

(B)

the Owner and any person acting on its behalf have taken reasonable steps to ensure that the Transferee is aware that the Owner may be relying on Rule 144A in connection with the transfer.

 

Annex B-1

---

(2) Rule 144 Transfers

 

If the transfer is being effected pursuant to Rule 144:

 

(A)

the transfer is occurring after October 9, 2008 and is being effected in accordance with the applicable amount, manner of sale and notice requirements of Rule 144; or

(B)

the transfer is occurring after October 9, 2009, and the Owner is not, and during the preceding three months has not been, an affiliate of the Company.

 

This certificate and the statements contained herein are made for your benefit and the benefit of the Company.

 

Dated:

	(Print the name of the Undersigned, as such term is defined in the second paragraph of this certificate.)
	By:
		Name:
		Title:
	(If the Undersigned is a corporation, partnership or fiduciary, the title of the person signing on behalf of the Undersigned must be stated.)

 

Annex B-2

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ANNEX C

 

FORM OF UNRESTRICTED NOTES CERTIFICATE

 

(For removal of Securities Act legends pursuant to Section 3.4(c)(iv) of the Indenture)

 

The Bank of New York

▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇ ▇▇▇▇

▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ 10286

Attn: Corporate Trust Administration—Global Finance Unit

 

Re.          U.S. $220,000,000 10.5% Notes due October 9, 2017 (the Notes)

 

Reference is made to the Indenture, dated October 9, 2007 (the Indenture), between the Company and The Bank of New York, as Trustee. Terms used herein and defined in the Indenture or in Regulation S or Rule 144 under the U.S. Securities Act of 1933, as amended (the Securities Act) are used herein as so defined.

 

This certificate relates to U.S. $                principal amount of Notes, which are evidenced by the following certificate(s) (the Specified Notes):

 

COMMON CODE No(s).

ISIN No(s).

CERTIFICATE No(s).

 

The person in whose name this certificate is executed below (the Undersigned) hereby certifies that either (i) it is the sole beneficial owner of the Specified Notes, (ii) it is acting on behalf of all the beneficial owners of the Specified Notes and is duly authorized by them to do so or (iii) it is the Holder of a Global Note and has received a certification to the effect set forth below. Such beneficial owner or owners are referred to herein collectively as the “Owner”. If the Specified Notes are not represented by a Global Note, they are registered in the name of the Undersigned, as or on behalf of the Owner.

 

The Owner has requested that the Specified Notes be exchanged for Notes bearing no Securities Act legend pursuant to Section 3.4(c)(iv)of the Indenture. In connection with such exchange, the Owner hereby certifies or has certified that the exchange is occurring after October 9, 2009, and the Owner is not, and during the preceding three months has not been, an affiliate of the Company. The Owner also acknowledges or has acknowledged that any future transfers of the Specified Notes must comply with all applicable securities laws of the states of the United States and other jurisdictions.

 

This certificate and the statements contained herein are made for your benefit and the benefit of the Company.

 

Dated:

	(Print the name of the Undersigned, as such term is defined in the second paragraph of this certificate.)
	By:
		Name:
		Title:
	(If the Undersigned is a corporation, partnership or fiduciary, the title of the person signing on behalf of the Undersigned must be stated.)

Annex C-1

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