EXHIBIT 4.1
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XXXX-XXXXX INC.
AND
THE BANK OF NEW YORK, Trustee
Indenture
Dated as of May ___, 1998
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$250,000,000
___% Senior Subordinated Notes Due 2008
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TABLE OF CONTENTS
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ARTICLE 1
DEFINITIONS
SECTION 1.01. Certain Terms Defined.....................................................12
SECTION 1.02. Other Definitions.........................................................29
ARTICLE 2
ISSUE, EXECUTION, FORM AND REGISTRATION OF SECURITIES
SECTION 2.01. Authentication and Delivery of Securities.................................30
SECTION 2.02. Execution of Securities...................................................30
SECTION 2.03. Certificate of Authentication.............................................31
SECTION 2.04. Form, Denomination and Date of Securities; Payments of
Interest......................................................................31
SECTION 2.05. Global Security Legends...................................................32
SECTION 2.06. Registration, Transfer and Exchange.......................................32
SECTION 2.07. Book-Entry Provisions for Global Securities...............................34
SECTION 2.08. Mutilated, Defaced, Destroyed, Lost and Stolen Securities.................35
SECTION 2.09. Cancellation of Securities................................................36
SECTION 2.10. Temporary Securities......................................................36
SECTION 2.11. CUSIP and CINS Numbers....................................................36
ARTICLE 3 COVENANTS OF THE
COMPANY AND THE TRUSTEE.
SECTION 3.01. Payment of Principal and Interest.........................................37
SECTION 3.02. Offices for Payments, etc.................................................37
SECTION 3.03. Appointment to Fill a Vacancy in Office of Trustee........................37
SECTION 3.04. Paying Agents.............................................................37
SECTION 3.05. Certificates to Trustee...................................................38
SECTION 3.06. Securityholders' Lists....................................................39
SECTION 3.07. Reports by the Trustee....................................................39
SECTION 3.08. Limitation on Restricted Payments.........................................39
SECTION 3.09. Limitation on Indebtedness................................................42
SECTION 3.10. Limitation on Asset Sales.................................................45
SECTION 3.11. Limitation on Liens.......................................................47
SECTION 3.12. Limitation on Dividend and Other Payment Restrictions
Affecting Restricted Subsidiaries.............................................47
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SECTION 3.13. Limitation on Senior Subordinated Indebtedness.............................48
SECTION 3.14. Limitation on Transactions with Shareholders and
Affiliates....................................................................49
SECTION 3.15. Limitation on the Issuance of Guarantees by Restricted
Subsidiaries..................................................................49
SECTION 3.16. Limitation on the Issuance of Capital Stock of Restricted
Subsidiaries..................................................................50
SECTION 3.17. Repurchase of Securities Upon a Change of Control.........................51
SECTION 3.18. Limitation of Applicability of Certain Covenants if
Securities Rated Investment Grade.............................................52
SECTION 3.19. SEC Reports...............................................................52
SECTION 3.20. Existence.................................................................53
SECTION 3.21. Payment of Taxes and Other Claims.........................................53
SECTION 3.22. Maintenance of Properties and Insurance...................................54
SECTION 3.23. Waiver of Stay, Extension or Usury Laws...................................54
ARTICLE 4
REMEDIES OF THE TRUSTEE AND HOLDERS ON EVENT OF DEFAULT
SECTION 4.01. Events of Default.........................................................55
SECTION 4.02. Acceleration..............................................................56
SECTION 4.03. Other Remedies............................................................57
SECTION 4.04. Waiver of Past Defaults...................................................57
SECTION 4.05. Control by Majority.......................................................57
SECTION 4.06. Limitation on Suits.......................................................58
SECTION 4.07. Rights of Holders to Receive Payment......................................58
SECTION 4.08. Collection Suit by Trustee................................................58
SECTION 4.09. Trustee May File Proofs of Claim..........................................58
SECTION 4.10. Priorities................................................................59
SECTION 4.11. Undertaking for Costs.....................................................59
ARTICLE 5
CONCERNING THE TRUSTEE
SECTION 5.01. Duties and Responsibilities of the Trustee; During Default;
Prior to Default..............................................................60
SECTION 5.02. Certain Rights of the Trustee.............................................61
SECTION 5.03. Trustee Not Responsible for Recitals, Disposition of
Securities or Application of Proceeds Thereof.................................62
SECTION 5.04. Trustee and Agents May Hold Securities; Collections, etc..................63
SECTION 5.05. Moneys Held by Trustee....................................................63
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SECTION 5.06. Notice of Default.........................................................63
SECTION 5.07. Compensation and Indemnification of Trustee and Its
Prior Claim...................................................................63
SECTION 5.08. Right of Trustee to Rely on Officers' Certificate, etc....................64
SECTION 5.09. Persons Eligible for Appointment as Trustee...............................64
SECTION 5.10. Resignation and Removal; Appointment of Successor
Trustee.......................................................................65
SECTION 5.11. Acceptance of Appointment by Successor Trustee............................66
SECTION 5.12. Merger, Conversion, Consolidation or Succession to
Business of Trustee...........................................................67
SECTION 5.13. Preferential Collection of Claims.........................................67
ARTICLE 6
CONCERNING THE HOLDERS
SECTION 6.01. Evidence of Action Taken by Holders.......................................68
SECTION 6.02. Proof of Execution of Instruments and of Holding of
Securities; Record Date.......................................................68
SECTION 6.03. Securities Owned by Company Deemed Not Outstanding........................68
SECTION 6.04. Right of Revocation of Action Taken.......................................69
ARTICLE 7
SUPPLEMENTAL INDENTURES
SECTION 7.01. Supplemental Indentures Without Consent of Holders........................70
SECTION 7.02. With Consent of Holders...................................................70
SECTION 7.03. Effect of Supplemental Indenture..........................................72
SECTION 7.04. Documents to Be Given to Trustee; Compliance with TIA.....................72
SECTION 7.05. Notation on Securities in Respect of Supplemental
Indentures....................................................................73
ARTICLE 8
CONSOLIDATION, MERGER OR SALE OF ASSETS
SECTION 8.01. Consolidation, Merger or Sale of Assets...................................73
SECTION 8.02. Successor Corporation Substituted.........................................74
SECTION 8.03. Opinion of Counsel to Trustee.............................................75
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ARTICLE 9
SUBORDINATION
SECTION 9.01. Agreement to Subordinate..................................................75
SECTION 9.02. Liquidation; Dissolution; Bankruptcy......................................75
SECTION 9.03. Default on Designated Senior Indebtedness.................................76
SECTION 9.04. When Distributions Must Be Paid Over......................................77
SECTION 9.05. Notice....................................................................78
SECTION 9.06. Subrogation...............................................................78
SECTION 9.07. Relative Rights...........................................................79
SECTION 9.08. The Company and Holders May Not Impair Subordination......................79
SECTION 9.09. Distribution or Notice to Representative..................................80
SECTION 9.10. Rights of Trustee and Paying Agent........................................80
SECTION 9.11. Authorization to Effect Subordination.....................................81
SECTION 9.12. Payment...................................................................81
ARTICLE 10
REDEMPTION OF SECURITIES
SECTION 10.01. Right of Optional Redemption; Prices.....................................81
SECTION 10.02. Notice of Redemption; Partial Redemptions................................82
SECTION 10.03. Payment of Securities Called for Redemption..............................83
SECTION 10.04. Exclusion of Certain Securities from Eligibility for
Selection for Redemption......................................................84
ARTICLE 11
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 11.01. Company's Option to Effect Defeasance or Covenant
Defeasance....................................................................84
SECTION 11.02. Legal Defeasance and Discharge...........................................84
SECTION 11.03. Covenant Defeasance......................................................85
SECTION 11.04. Conditions to Legal or Covenant Defeasance...............................85
SECTION 11.05. Deposited Money and Government Securities to be Held
in Trust; Other Miscellaneous Provisions......................................87
SECTION 11.06. Repayment to Company.....................................................87
SECTION 11.07. Reinstatement............................................................88
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ARTICLE 12
MISCELLANEOUS PROVISIONS
SECTION 12.01. Incorporators, Stockholders, Officers, Directors,
Employees and Controlling Persons of Company Exempt from
Individual Liability..........................................................88
SECTION 12.02. Provisions of Indenture for the Sole Benefit of Parties and
Holders.......................................................................89
SECTION 12.03. Successors and Assigns of Company Bound by Indenture.....................89
SECTION 12.04. Notices and Demands on Company, Trustee and Holders......................89
SECTION 12.05. Officers' Certificates and Opinions of Counsel;
Statements to Be Contained Therein............................................90
SECTION 12.06. Payments Due on Saturdays, Sundays and Holidays..........................91
SECTION 12.07. Conflict of Any Provision of Indenture with Trust
Indenture Act of 1939.........................................................91
SECTION 12.08. New York Law to Govern...................................................91
SECTION 12.09. Third Party Beneficiaries................................................91
SECTION 12.10. Counterparts............................................................91
SECTION 12.11. Effect of Headings.......................................................92
v
THIS INDENTURE, dated as of May ___, 1998 between Xxxx-Xxxxx Inc.
(formerly ZD Inc.), a Delaware corporation (the "Company"), and The Bank of New
York, a New York banking corporation (the "Trustee"),
W I T N E S S E T H :
WHEREAS, the Company has duly authorized the issuance of its ___%
Senior Subordinated Notes Due 2008 (the "Securities") and, to provide, among
other things, for the authentication, delivery and administration thereof, the
Company has duly authorized the execution and delivery of this Indenture; and
WHEREAS, the Securities and the Trustee's certificate of
authentication shall be in substantially the following form:
[FORM OF FACE OF SECURITY]
No. $
[CUSIP] [CINS]
Xxxx-Xxxxx Inc.
___% Senior Subordinated Note Due 2008
Xxxx-Xxxxx Inc., a Delaware corporation (the "Company"), for value
received hereby promises to pay to ___ or registered assigns the principal sum
of ___ Dollars at the Company's office or agency for said purpose in The City of
New York, on ___ , 2008, in such coin or currency of the United States of
America as at the time of payment shall be legal tender for the payment of
public and private debts, and to pay interest, semi-annually on ___ and ___
(each an "Interest Payment Date") of each year, commencing with ___, 1998, on
said principal sum in like coin or currency at the rate per annum set forth
above at said office or agency from the most recent Interest Payment Date to
which interest on the Securities has been paid or duly provided for, unless the
date hereof is a date to which interest on the Securities has been paid or duly
provided for, in which case from the date of this Security, or, if no interest
on the Securities has been paid or duly provided for, from May __, 1998.
Notwithstanding the foregoing, if the date hereof is after ___ or___ (each a
"Regular Record Date"), as the case may be, and before the immediately following
Interest Payment Date, this Security shall bear interest from such Interest
Payment Date; provided, that if the Company shall default in the payment of
interest due on such Interest Payment Date then this Security shall bear
interest from the next preceding Interest Payment Date to which interest on the
Securities has been paid or duly provided for. The interest so payable on any
Interest Payment Date will, except as otherwise provided in the Indenture
referred to on the reverse hereof, be paid to the person in whose name this
Security is registered at the close of business on the
Regular Record Date preceding such Interest Payment Date whether or not such day
is a business day; provided that interest may be paid, at the option of the
Company, by mailing a check therefor payable to the registered holder entitled
thereto at such holder's last address as it appears on the Security register or
by wire transfer, in immediately available funds, to such bank or other entity
in the continental United States as shall be designated in writing by such
holder prior to the relevant Regular Record Date and shall have appropriate
facilities for such purpose, or in accordance with the standard operating
procedures of the Depositary (as defined in the Indenture).
Interest, other than default interest, on the Securities will be
computed on the basis of a 360-day year consisting of twelve 30-day months.
Reference is made to the further provisions set forth on the reverse
hereof. Such further provisions shall for all purposes have the same effect as
though fully set forth at this place.
This Security shall not be valid or obligatory until the certificate
of authentication hereon shall have been duly signed by the Trustee acting under
the Indenture.
2
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
XXXX-XXXXX INC.
By:
----------------------------------
Name:
Title:
3
[FORM OF REVERSE OF SECURITY]
Xxxx-Xxxxx Inc.
___% Senior Subordinated Note Due 2008
This Security is one of a duly authorized issue of debt securities of
the Company, limited to the aggregate principal amount of $250,000,000 (except
as otherwise provided in the Indenture mentioned below), issued or to be issued
pursuant to an indenture dated as of May ___, 1998 (the "Indenture"), duly
executed and delivered by the Company to The Bank of New York, as Trustee
(herein called the "Trustee"). Reference is hereby made to the Indenture and all
indentures supplemental thereto for a description of the rights, limitations of
rights, obligations, duties and immunities thereunder of the Trustee, the
Company and the holders (the words "holders" or "holder" meaning the registered
holders or registered holder) of the Securities.
This Security will bear interest until final maturity at a rate per
annum shown above, except as provided in the next paragraph. The Company will
pay interest on overdue principal of, premium, if any, and to the extent lawful,
interest on overdue installments of interest, at an ___% rate per annum based on
a 360-day year consisting of twelve 30-day months.
In case an Event of Default (as defined in the Indenture) shall have
occurred and be continuing, the principal of all the Securities may be declared
due and payable, in the manner and with the effect, and subject to the
conditions, provided in the Indenture. The Indenture provides that in certain
events such declaration and its consequences may be waived by the holders of a
majority in aggregate principal amount of the Securities then outstanding and
that, prior to any such declaration, such holders may waive any past default
under the Indenture and its consequences except a default in the payment of
principal of, premium, if any, or interest on any of the Securities. Any such
consent or waiver by the holder of this Security (unless revoked as provided in
the Indenture) shall be conclusive and binding upon such holder and upon all
future holders and owners of this Security and any Security which may be issued
in exchange or substitution herefor, whether or not any notation thereof is made
upon this Security or such other Securities.
The Indenture permits the Company and the Trustee, with the consent
of the holders of at least a majority in aggregate principal amount of the
Securities at the time outstanding, evidenced as in the Indenture provided, to
execute supplemental indentures adding any provisions to or changing in any
manner or eliminating any of the provisions of the Indenture or of any
supplemental indenture or modifying in any manner the rights of the holders of
the Securities; provided that no such
4
modification or amendment may, without the consent of each holder affected
thereby, (i) change the Stated Maturity (as defined in the Indenture) of the
principal of, or any installment of interest on, any Security, (ii) reduce the
principal amount of, or premium, if any, or interest on, any Security, (iii)
reduce any amount payable on redemption of the Securities or upon the occurrence
on an Event of Default or reduce the Change of Control Payment (as defined in
the Indenture) or the Excess Proceeds Payment (as defined in the Indenture),
(iv) change the place or currency of payment of principal of, premium, if any,
or interest on, any Security, (v) impair the right to institute suit for the
enforcement of any payment on or after the Stated Maturity (or, in the case of a
redemption, on or after the redemption date) of any Security, (vi) reduce the
above-stated percentage of outstanding Securities the consent of whose holders
is necessary to modify or amend the Indenture, (vii) waive a default in the
payment of principal of, premium, if any, or interest on the Securities, (viii)
reduce the percentage or aggregate principal amount of outstanding Securities
the consent of whose holders is necessary for waiver of compliance with certain
provisions of the Indenture or for waiver of certain defaults, (ix) modify or
change any provision of the Indenture affecting the ranking of the Securities or
the Subsidiary Guarantee (as defined in the Indenture) in a manner adverse to
the holders of the Securities or (x) release any Guarantor (as defined in the
Indenture) from any of its obligations under its Subsidiary Guarantee or the
Indenture other than in accordance with the provisions of the Indenture, or
amend or modify any provision relating to such release.
Notwithstanding the foregoing, without the consent of any holder of
Securities, the Company and the Trustee may amend or supplement the Indenture or
the Securities to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Securities in addition to or in place of certificated Securities,
to provide for the assumption of the Company's obligations to holders of
Securities in the case of a merger or consolidation, to make any change that
would provide any additional rights or benefits to the holders of Securities or
that does not adversely affect the legal rights under the Indenture of any such
holder, or to comply with requirements of the Commission (as defined in the
Indenture) in order to effect or maintain the qualification of the Indenture
under the Trust Indenture Act of 1939 (as defined in the Indenture).
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of, premium,
if any, and interest on this Security at the place, times, and rate, and in the
currency, herein prescribed.
The Securities are issuable only as registered Securities without
coupons in denominations of $1,000 and any multiple of $1,000.
5
At the office or agency of the Company referred to on the face hereof
and in the manner and subject to the limitations provided in the Indenture,
Securities may be exchanged for a like aggregate principal amount of Securities
of other authorized denominations.
Upon due presentment for registration of transfer of this Security at
the above-mentioned office or agency of the Company, a new Security or
Securities of authorized denominations, for a like aggregate principal amount,
will be issued to the transferee as provided in the Indenture. No service charge
shall be made for any such transfer, but the Company may require payment of a
sum sufficient to cover any tax or other similar governmental charge that may be
imposed in connection therewith.
The Securities may be redeemed at the option of the Company as a
whole, or from time to time in part, on any date on or after ___, 2003, upon
mailing a notice of such redemption not less than 30 nor more than 60 days prior
to the date fixed for redemption to the holders of Securities to be redeemed,
all as provided in the Indenture, at the following redemption prices (expressed
in percentages of principal amount) together in each case with accrued and
unpaid interest to the date fixed for redemption (subject to the right of
holders of record on the relevant Regular Record Date to receive interest on an
Interest Payment Date that is on or prior to the redemption date):
If redeemed during the twelve-month period beginning ___,
Year Percentage
2003........................................................................... ___%
2004........................................................................... ___%
2005........................................................................... ___%
2006 and thereafter............................................................ 100.0000%
In addition, at any time and from time to time prior to ___, 2001, the Company
may redeem in the aggregate up to 35% of the original principal amount of the
Securities with the proceeds of one or more Public Equity Offerings (as defined
in the Indenture) commenced after the Issue Date (as defined in the Indenture),
at a redemption price (expressed as a percentage of principal amount) of __%
plus accrued interest to the redemption date (subject to the right of holders of
record on the relevant Regular Record Date to receive interest due on an
Interest Payment Date that is on or prior to the redemption date); provided that
at least $150 million aggregate principal amount of the Securities must remain
outstanding after each such redemption; and provided further that any such
redemption shall occur within 60 days of the date of the closing of such Public
Equity Offering.
6
Subject to payment by the Company of a sum sufficient to pay the
amount due on redemption, interest on this Security (or portion hereof if this
Security is redeemed in part) shall cease to accrue upon the date duly fixed for
redemption of this Security (or portion hereof if this Security is redeemed in
part).
Upon a Change of Control (as defined in the Indenture), any holder of
Securities will have the right to cause the Company to purchase the Securities
of such holder, in whole or in part in integral multiples of aggregate principal
amount of $1,000, at a purchase price in cash equal to 101% of the principal
amount thereof plus accrued and unpaid interest, if any, to any Change of
Control Payment Date (as defined in the Indenture), as provided in, and subject
to the terms of the Indenture.
All amounts owed under and in respect of this Security are
subordinated in right of payment, to the extent and in the manner provided in
Article Nine of the Indenture, to the prior payment in full in cash of all
amounts owed under and in respect of all Senior Indebtedness (as defined in the
Indenture) of the Company, and the subordination of the Securities is for the
benefit of all holders of all Senior Indebtedness of the Company, whether
outstanding on the Issue Date or incurred thereafter. The Company agrees, and
each holder by accepting a Security agrees, to the subordination.
The Company, the Trustee, and any authorized agent of the Company or
the Trustee, may deem and treat the registered holder hereof as the absolute
owner of this Security (whether or not this Security shall be overdue and
notwithstanding any notation of ownership or other writing hereon made by anyone
other than the Company or the Trustee or any authorized agent of the Company or
the Trustee), for the purpose of receiving payment of, or on account of, the
principal hereof and premium, if any, and, subject to the provisions on the face
hereof, interest hereon and for all other purposes, and neither the Company nor
the Trustee nor any authorized agent of the Company or the Trustee shall be
affected by any notice to the contrary.
No recourse shall be had for the payment of the principal of,
premium, if any, or the interest on this Security, for any claim based thereon,
or otherwise in respect thereof, and no recourse under or upon any obligation,
covenant or agreement of the Company in the Indenture, or in any of the
Securities or because of the creation of any Indebtedness (as defined in the
Indenture) represented thereby, against any incorporator, shareholder, officer,
director, employee or controlling person of the Company or of any successor
Person thereof, either directly or through the Company or any successor Person,
whether by virtue of any constitution, statute or rule of law or by the
enforcement of any assessment or penalty or otherwise, all such liability being,
by the acceptance hereof and as part of the consideration for the issue hereof,
expressly waived and released.
7
The Indenture is hereby incorporated by the reference and to the
extent of any variance between the provisions hereof and the Indenture, the
Indenture shall control.
This Security shall be deemed to be a contract under the laws of the
State of New York, and for all purposes shall be construed in accordance with
the laws of said State, except as may otherwise be required by mandatory
provisions of law.
8
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
Dated:
-----------------------------
This is one of the Securities described in the within-mentioned
Indenture.
THE BANK OF NEW YORK,
as Trustee
By:
----------------------------
Authorized Signatory
9
[FORM OF TRANSFER NOTICE]
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto
Insert Taxpayer Identification No.
--------------------------------------------------------------------------------
Please print or typewrite name and address including zip code of assignee
--------------------------------------------------------------------------------
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing ____________________ attorney to transfer said Security on the
books of the Company with full power of substitution in the premises.
Date: --------------------------------
___________ NOTICE: The signature to this
assignment must correspond with
the name as written upon the face
of the within-mentioned
instrument in every particular,
without alteration or any change
whatsoever.
Signature Guarantee:
------------
10
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the Company pursuant
to Section 3.10 or Section 3.17 of the Indenture, check the Box: [_]
If you wish to have a portion of this Security purchased by the
Company pursuant to Section 3.10 or Section 3.17 of the Indenture, state the
amount (in principal amount at maturity): $_______________.
Date:
_______________
Your Signature: ______________________________________________
(Sign exactly as your name appears on
the other side of this Security)
Signature Guarantee: _________________________
11
AND WHEREAS, all things necessary to make the Securities, when
executed by the Company and authenticated and delivered by the Trustee as in the
Indenture provided, the valid, binding and legal obligations of the Company, and
to constitute these presents a valid indenture and agreement according to its
terms, have been done;
NOW, THEREFORE:
In consideration of the premises and the purchases of the Securities
by the Holders thereof, the Company and the Trustee mutually covenant and agree
for the equal and proportionate benefit of the respective Holders from time to
time of the Securities as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. Certain Terms Defined. The following terms (except as
otherwise expressly provided or unless the context otherwise clearly requires)
for all purposes of this Indenture and of any indenture supplemental hereto
shall have the respective meanings specified in this Section. All other terms
used in this Indenture which are defined in the Trust Indenture Act of 1939 or
the definitions of which in the Securities Act of 1933 are referred to in the
Trust Indenture Act of 1939 (except as herein otherwise expressly provided or
unless the context otherwise clearly requires), shall have the meanings assigned
to such terms in said Trust Indenture Act and in said Securities Act as in force
at the date of this Indenture. All accounting terms used herein and not
expressly defined shall have the meanings given to them in accordance with GAAP
(whether or not such is indicated herein). The words "herein", "hereof" and
"hereunder" and other words of similar import refer to this Indenture as a whole
and not to any particular Article, Section or other subdivision. The terms
defined in this Article include the plural as well as the singular.
"Acquired Indebtedness" means Indebtedness of a Person existing at
the time such Person merged or consolidated with or into or became a Restricted
Subsidiary or assumed in connection with a Business Acquisition by the Company
or a Restricted Subsidiary and not Incurred in connection with, or in
contemplation of, such Person becoming a Restricted Subsidiary or such Business
Acquisition, provided that Indebtedness of such Person which is redeemed,
defeased, retired or otherwise repaid at the time of or immediately upon
consummation of the transactions by which such Person becomes a Restricted
Subsidiary or such Business Acquisition shall not be Acquired Indebtedness.
12
"Adjusted Consolidated Net Income" means, for any period, the
aggregate net income (or loss) of the Company and its Restricted Subsidiaries
for such period determined in conformity with GAAP; provided that the following
items shall be excluded in computing Adjusted Consolidated Net Income (without
duplication): (i) the net income (but not loss) of any Person that is not a
Restricted Subsidiary, except to the extent of the amount of dividends or other
distributions that are actually paid in cash to the Company or any of its
Restricted Subsidiaries by such Person during such period; (ii) solely for the
purposes of calculating the amount of Restricted Payments that may be made
pursuant to clause (C) of the first paragraph of Section 3.08 (and in such case,
except to the extent includable pursuant to clause (i) above), the net income of
any Person accrued prior to the date it becomes a Restricted Subsidiary or is
merged into or consolidated with the Company or any of its Restricted
Subsidiaries or all or substantially all of the property and assets of such
Person are acquired by the Company or any of its Restricted Subsidiaries; (iii)
the net income (or loss) of any Restricted Subsidiary to the extent that the
declaration or payment of dividends or similar distributions by such Restricted
Subsidiary of such net income is not permitted at such time of determination by
its charter or any agreement, instrument, judgment, decree, order, statute, rule
or governmental regulation applicable to such Restricted Subsidiary; (iv) any
net gains or losses (on an after-tax basis) attributable to asset sales and (v)
any net after-tax extraordinary gains or extraordinary losses.
"Affiliate" means, as applied to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
"Asset Sale" means any sale, transfer or other disposition (including
by way of merger, consolidation or sale-leaseback transaction) in one
transaction or a series of related transactions by the Company or any of its
Restricted Subsidiaries to any Person other than the Company or any of its
Restricted Subsidiaries of (i) all or any of the Capital Stock of any Restricted
Subsidiary, (ii) all or substantially all of the property and assets of an
operating unit or business of the Company or any of its Restricted Subsidiaries
or (iii) any other property and assets of the Company or any of its Restricted
Subsidiaries outside the ordinary course of business of the Company or such
Restricted Subsidiary and, in each case, that is not governed by the provisions
of the Indenture applicable to mergers, consolidations and sales of assets of
the Company; provided that "Asset Sale" shall not include (a) sales or other
dispositions of inventory, receivables and other current assets, (b) sales,
transfers or other dispositions of assets constituting a Restricted Payment
permitted to be made
13
under Section 3.08 or (c) sales or other dispositions of assets for
consideration at least equal to the fair market value of the assets sold or
disposed of (as determined in good faith by the Board of Directors), in the case
of this clause (c), to the extent that the consideration received consists of
property or assets that are to be used in the business of the Company and its
Restricted Subsidiaries.
"Average Life" means, at any date of determination with respect to
any Indebtedness, the quotient obtained by dividing (i) the sum of the products
of (a) the number of years from such date of determination to the dates of each
successive scheduled principal payment of such Indebtedness and (b) the amount
of such principal payment by (ii) the sum of all such principal payments.
"Bank Agent" shall mean The Bank of New York, or its successor as
administrative agent for the lenders under the Credit Agreement.
"Board Resolution" means a copy of a resolution, certified by the
Secretary of the Company to have been duly adopted by the Board of Directors and
to be in full force and effect on the date of such certification, and delivered
to the Trustee.
"Business Acquisition" means (i) an Investment by the Company or any
of its Restricted Subsidiaries in any other Person pursuant to which such Person
shall become a Restricted Subsidiary or shall be merged into or consolidated
with the Company or any of its Restricted Subsidiaries or (ii) an acquisition by
the Company or any of its Restricted Subsidiaries of the property and assets of
any Person other than the Company or any of its Restricted Subsidiaries that
constitute substantially all of the assets of such Person or of any division or
line of business of such Person.
"Board of Directors" means, with respect to any Person, the Board of
Directors of such Person, or any authorized committee of the Board of Directors
of such Person.
"Business Day" means any day except a Saturday, Sunday or other day
on which commercial banks in The City of New York are authorized by law to
close.
"Business Disposition" means any sale, transfer or other disposition
(including by way of merger or consolidation) in one transaction or a series of
related transactions by the Company or any of its Restricted Subsidiaries to any
Person other than the Company or any of its Restricted Subsidiary of (i) all or
substantially all of the Capital Stock of any Restricted Subsidiary or (ii) all
or substantially all of the assets of any Restricted Subsidiary or of any
division or line of business of the Company or any of its Restricted
Subsidiaries.
14
"Capital Stock" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated,
whether voting or non-voting) of such Person's capital stock or other ownership
interests, whether now outstanding or issued after the date of the Indenture,
including, without limitation, all common stock and Preferred Stock.
"Capitalized Lease" means, with respect to any Person, any lease of
any property (whether real, personal or mixed) of which the discounted present
value of the rental obligations of such Person as lessee, in conformity with
GAAP, is required to be capitalized on the balance sheet of such Person; and
"Capitalized Lease Obligation" means the rental obligations, as aforesaid, under
such lease.
"Certificated Securities" means securities issued in the form of
permanent certificated securities in registered form in substantially the form
hereinabove recited.
"Change of Control" means such time as (i) any "person" or "group"
(as such terms are used for purposes of Sections 13(d) and 14(d) of the Exchange
Act) other than the Existing Stockholders becomes the ultimate "beneficial
owner" (as such term is used in Rule 13d-3 promulgated pursuant to the Exchange
Act), directly or indirectly, of more than 50% of the aggregate voting power of
the Voting Stock of the Company on a fully diluted basis; or (ii) individuals
who on the Issue Date constitute the Board of Directors of the Company (together
with any new directors whose election by such Board or whose nomination for
election by the stockholders of the Company was approved by a majority of the
directors then in office who were either directors on the Issue Date or whose
election or nomination for election was previously so approved) cease for any
reason to constitute a majority of the Board of Directors of the Company then in
office.
"Commission" means the Securities and Exchange Commission.
"Common Stock" means, with respect to any Person, any and all shares
of such Person's Capital Stock (excluding Preferred Stock of such Person),
including, without limitation, all series and classes of such common stock.
"Consolidated EBITDA" means, for any period, the sum of Adjusted
Consolidated Net Income, plus (without duplication) the following to the extent
deducted in calculating Adjusted Consolidated Net Income: (i) Consolidated
Interest Expense; (ii) income taxes (other than income taxes (either positive or
negative) attributable to asset sales and extraordinary gains or extraordinary
losses); (iii) depreciation expense; (iv) amortization expense; (v) all other
non-cash items reducing Adjusted Consolidated Net Income (other than items which
will require cash payments and for which an accrual or reserve is, or is
required by GAAP to be, made) less all non-cash items increasing Adjusted
Consolidated Net Income, all as
15
determined on a consolidated basis for the Company and its Restricted
Subsidiaries in conformity with GAAP and (vi) the interest component of all
payments associated with Capitalized Lease Obligations paid, accrued or
scheduled to be paid or to be accrued by the Company and its Restricted
Subsidiaries during such period; provided that, if any Restricted Subsidiary is
not a Wholly Owned Restricted Subsidiary, Consolidated EBITDA shall be reduced
(to the extent Adjusted Consolidated Net Income is not otherwise reduced in
accordance with GAAP) by an amount equal to (A) the amount of the Adjusted
Consolidated Net Income attributable to such Subsidiary multiplied by (B) the
quotient of (1) the number of shares of outstanding common stock of such
Subsidiary not owned on the last day of such period by the Company or any
Restricted Subsidiary divided by (2) the total number of shares of outstanding
common stock of such Subsidiary on the last day of such period.
"Consolidated Interest Expense" means, for any period, the aggregate
amount of interest in respect of Indebtedness of the Company and its Restricted
Subsidiaries (including amortization of original issue discount on any
Indebtedness and the interest portion of any deferred payment obligation,
calculated in accordance with the effective interest method of accounting; all
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers' acceptance financing; the net costs associated with
Interest Rate Agreements; and interest in respect of Indebtedness that is
Guaranteed by the Company or any of its Restricted Subsidiaries or is secured by
a Lien on the assets of the Company or any of its Restricted Subsidiaries), plus
(without duplication) the product of (i) the aggregate amount for such period of
dividends on any Redeemable Stock of the Company and its Restricted Subsidiaries
and (ii) a fraction, the numerator of which is one and the denominator of which
is one minus the then current combined Federal, state, local and foreign
statutory tax rate, expressed as a decimal; excluding, however, (i) any amount
of such interest or dividends of any Restricted Subsidiary if the net income of
such Restricted Subsidiary is excluded in the calculation of Adjusted
Consolidated Net Income pursuant to clause (iii) of the definition thereof (but
only in the same proportion as the net income of such Restricted Subsidiary is
excluded from the calculation of Adjusted Consolidated Net Income pursuant to
clause (iii) of the definition thereof) and (ii) any premiums, fees and expenses
(and any amortization thereof) payable in connection with the offering of the
Securities and the consummation of the Credit Agreement, all as determined on a
consolidated basis (without taking into account Unrestricted Subsidiaries) in
conformity with GAAP.
"Consolidated Leverage Ratio" means, on any Transaction Date, the
ratio of (i) the aggregate amount of Indebtedness of the Company and its
Restricted Subsidiaries on a consolidated basis outstanding at such Transaction
Date to (ii) the aggregate amount of Consolidated EBITDA for the four most
recent fiscal quarters immediately prior to such Transaction Date for which
financial statements of the Company have been filed with the Commission pursuant
to Section 3.19 (the
16
"Reference Period"). In making the foregoing calculation, (A) pro forma effect
shall be given to (x) any Indebtedness (other than Indebtedness referred to in
clause (E) hereof) Incurred from the beginning of the Reference Period through
the Transaction Date, to the extent such Indebtedness is outstanding on the
Transaction Date and (y) the repayment of any Indebtedness (other than
Indebtedness referred to in clause (E) hereof) that was outstanding during or
after such Reference Period but that is not outstanding or is to be repaid on
the Transaction Date; (B) pro forma effect shall be given to Business
Dispositions and Business Acquisitions (including giving pro forma effect to the
application of proceeds of any Business Disposition) that occur during such
Reference Period or thereafter and on or prior to the Transaction Date as if
they had occurred and such proceeds had been applied on the first day of such
Reference Period; (C) pro forma effect shall be given to asset dispositions and
asset acquisitions (including giving pro forma effect to the application of
proceeds of any asset disposition) that have been made by any Person that has
become a Restricted Subsidiary or has been merged with or into the Company or
any Restricted Subsidiary during such Reference Period or subsequent to such
period and prior to the Transaction Date and that would have constituted
Business Dispositions or Business Acquisitions had such transactions occurred
when such Person was a Restricted Subsidiary as if such Business Dispositions or
Business Acquisitions were Business Dispositions or Business Acquisitions that
occurred on the first day of such Reference Period, (D) until such time as the
Reference Period includes four fiscal quarters subsequent to the Issue Date, pro
forma effect shall be given to the Reorganization and (E) the aggregate amount
of Indebtedness outstanding at such Transaction Date will be deemed to include
the average amount of funds outstanding during such Reference Period under any
revolving credit or similar facilities of the Company or its Restricted
Subsidiaries; provided that to the extent that clause (B) or (C) of this
sentence requires that pro forma effect be given to a Business Acquisition or
Business Disposition, such pro forma calculation shall be based upon the four
full fiscal quarters immediately preceding the Transaction Date of the Person,
or division or line of business of the Person, that is acquired or disposed of
for which financial information is available.
"Consolidated Net Worth" of any Person means, at any date of
determination, stockholder's equity of such Person, less (i) any amounts
attributable to Redeemable Stock or any equity security convertible into or
exchangeable for Indebtedness, (ii) the cost of treasury stock and (iii) the
principal amount of any promissory notes receivable from the sale of the Capital
Stock of such Person (excluding the effects of foreign currency exchange
adjustments under Financial Accounting Standards Board Statement of Financial
Accounting Standards No. 52).
"Corporate Trust Office" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
principally
17
administered, which office is, at the date as of which this Indenture is dated,
located at 000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Credit Agreement" means the credit agreement to be entered into
between the Company and Xxxxxx Xxxxxxx Senior Funding, The Bank of New York, The
Chase Manhattan Bank and DLJ Capital Funding, as agents for a group of financial
institutions, as lenders, on or prior to the Issue Date, together with any
agreements, instruments and documents executed or delivered pursuant to or in
connection with such Credit Agreement (including, without limitation, any
Guarantee or security documents), in each case as such Credit Agreement or such
agreements, instruments or documents may be amended, supplemented, refinanced,
refunded, replaced or otherwise modified from time to time and whether by the
same or any other agent, lender or group of lenders.
"Currency Agreement" means any foreign exchange contract, currency
swap agreement or other similar agreement entered into by the Company or any
Restricted Subsidiary for the purpose of protecting such Person against
fluctuations in currency rates.
"Default" means any event that is, or after notice or passage of time
or both would be, an Event of Default.
"Depositary" means The Depository Trust Company, its nominees, and
their respective successors.
"Designated Senior Indebtedness" means the Indebtedness under the
Credit Agreement and any other Indebtedness constituting Senior Indebtedness
that, at the date of determination, has an aggregate principal amount
outstanding of at least $75 million and that is specifically designated by the
Issuer, in the instrument creating or evidencing such Senior Indebtedness as
"Designated Senior Indebtedness."
"Event of Default" means any event or condition specified as such in
Section 4.01 which shall have continued for the period of time, if any, therein
designated.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Existing Affiliate Agreements" means the agreements between the
Company or any Subsidiary of the Company, on the one hand, and SOFTBANK Corp. or
any of its Affiliates (other than the Company and its Subsidiaries), on the
other hand, that are filed as exhibits to the Company's Registration Statement
on Form S-1 (File No. 333-46493), and, in each case, any renewal, extension or
amendment thereof that is on terms no less favorable to the Holders than the
terms in effect on the Issue Date.
18
"Existing Softbank Note" means the 9.9% promissory note due on
February 28, 2009 payable to SOFTBANK Corp. by ZD COMDEX and Forums Inc. as in
effect on the Issue Date.
"Existing Stockholders" means SOFTBANK Corp. and its Affiliates.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect on the Issue Date, including, without limitation,
those set forth in the opinions and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant segment of the
accounting profession.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness or other obligation
of any other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation of such other Person (whether arising by virtue
of partnership arrangements, or by agreement to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise) or (ii) entered into for purposes of assuring
in any other manner the obligee of such Indebtedness or other obligation of the
payment thereof or to protect such obligee against loss in respect thereof (in
whole or in part); provided that the term "Guarantee" shall not include
endorsements for collection or deposit in the ordinary course of business. The
term "Guarantee" used as a verb has a corresponding meaning.
"Guarantor" means any Restricted Subsidiary which issues a Subsidiary
Guarantee pursuant to Section 3.15; provided that any Guarantor that becomes an
Unrestricted Subsidiary in compliance with Sections 3.08 and 3.09 shall not be a
"Guarantor" after becoming an Unrestricted Subsidiary.
"Holders", "holder of Securities", "Securityholder" or other similar
terms means a person in whose name a Security is registered.
"Incur" means, with respect to any Indebtedness, to incur, create,
issue, assume, Guarantee or otherwise become liable for or with respect to, or
become responsible for, the payment of, contingently or otherwise, such
Indebtedness; provided that (i) the Indebtedness of a Person existing at the
time such Person became a Subsidiary or a Restricted Subsidiary, as the case may
be, shall be deemed to have been Incurred at such time by such Subsidiary or
Restricted Subsidiary, as
19
the case may be, and (ii) that neither the accrual of interest nor the accretion
of original issue discount shall be considered an Incurrence of Indebtedness.
"Indebtedness" means, with respect to any Person at any date of
determination (without duplication), whether or not Incurred at the date of the
Indenture (i) all indebtedness of such Person for borrowed money; (ii) all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments; (iii) all obligations of such Person in respect of letters
of credit or other similar instruments (including reimbursement obligations with
respect thereto, but excluding obligations with respect to letters of credit
(including trade letters of credit) securing obligations entered into in the
ordinary course of business of such Person to the extent such letters of credit
are not drawn upon or, if drawn upon, to the extent such drawing is reimbursed
no later than the third Business Day following receipt by such Person of a
demand for reimbursement), (iv) all obligations of such Person to pay the
deferred and unpaid purchase price of property or services (but excluding Trade
Payables or accrued liabilities arising in the ordinary course of business); (v)
all Capitalized Lease Obligations of such Person; (vi) all Indebtedness of other
Persons secured by a Lien on any asset of such Person, whether or not such
Indebtedness is assumed by such Person; provided that the amount of such
Indebtedness shall be the lesser of (A) the fair market value of such asset at
such date of determination (as determined in good faith by the Board of
Directors), and (B) the amount of such Indebtedness; (vii) all Indebtedness of
other Persons Guaranteed by such Person to the extent such Indebtedness is
Guaranteed by such Person; (viii) all Redeemable Stock issued by such Person
valued at the greater of its voluntary or involuntary maximum fixed repurchase
price; and (ix) to the extent not otherwise included in this definition,
obligations under Currency Agreements and Interest Rate Agreements. The amount
of Indebtedness of any Person at any date shall be the outstanding balance at
such date of all unconditional obligations as described above and, with respect
to contingent obligations, the maximum liability upon the occurrence of the
contingency giving rise to the obligation, provided (A) that the amount
outstanding at any time of any Indebtedness issued with original issue discount
is the face amount of such Indebtedness less the remaining unamortized portion
of the original issue discount of such Indebtedness at such time as determined
in conformity with GAAP, (B) that Indebtedness shall not include any liability
for Federal, state, local or other taxes and (C) that money borrowed and set
aside at the time of the Incurrence of any Indebtedness in order to prefund the
payment of the interest on such Indebtedness shall not be deemed to be
"Indebtedness" so long as such money is held to secure the payment of such
interest.
"Indenture" means this instrument as originally executed and
delivered or, if amended or supplemented as herein provided, as so amended or
supplemented.
20
"Interest Payment Date" means each semiannual interest payment date
on ____ and ____ of each year, commencing ____, 1998.
"Interest Rate Agreement" means any interest rate swap agreement,
interest rate cap agreement or other financial agreement or arrangement incurred
by the Company or any Restricted Subsidiary for the purpose of fixing or hedging
such Person's exposure to fluctuations in interest rates.
"Investment" means any direct or indirect advance, loan or other
extension of credit (other than advances to customers in the ordinary course of
business that are, in conformity with GAAP, recorded as accounts receivable on
the balance sheet of the lender) or capital contribution to (by means of any
transfer of cash or other property to others or any payment for property or
services for the account or use of others), or any purchase or acquisition of
Capital Stock, bonds, notes, debentures or other similar instruments issued by
such Person, including, without limitation, pursuant to an Asset Sale, and shall
include (i) the designation of a Restricted Subsidiary as an Unrestricted
Subsidiary and (ii) the fair market value of the Capital Stock (or any other
Investment), held by the Company or any of its Restricted Subsidiaries, of (or
in) any Person that has ceased to be a Restricted Subsidiary, including without
limitation, by reason of any transaction permitted by clause (iii) of Section
3.16 provided, that "Investment" shall not include (i) Interest Rate Agreements
and Currency Agreements, (ii) loans and advances to employees made in the
ordinary course of business, (iii) prepaid expenses, negotiable instruments held
for collection and lease, utility and workers' compensation, performance and
other similar documents and (iv) payroll, travel and similar advances to cover
matters that are expected at the time of such advances ultimately to be treated
as expenses in accordance with GAAP. For purposes of the definition of
"Unrestricted Subsidiary" and Section 3.08, (i) "Investment" shall include the
fair market value of the assets (net of liabilities (other than liabilities to
the Company or any of its Restricted Subsidiaries)) of any Restricted Subsidiary
at the time that such Restricted Subsidiary is designated an Unrestricted
Subsidiary and shall exclude the fair market value of the assets (net of
liabilities (other than liabilities to the Company or any of its Restricted
Subsidiaries)) of any Unrestricted Subsidiary at the time that such Unrestricted
Subsidiary is designated a Restricted Subsidiary and (ii) any property
transferred to or from any Person shall be valued at its fair market value at
the time of such transfer, in each case as determined by the Board of Directors
in good faith.
"Investment Grade Rated" means having a rating of BBB, A, AA or AAA,
as modified by any plus or minus indication, or an equivalent successor rating,
by S&P or any of its successors or assigns and a rating of Baa, A, Aa or Aaa, as
modified by any numerical indication, or an equivalent successor rating, by
Moody's or any of its successors or assigns.
21
"Issue Date" means the date and time at which the Securities are
originally issued under the Indenture.
"Lien" means any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including, without limitation, any conditional sale
or other title retention agreement or lease in the nature thereof, any sale with
recourse against the seller or any Affiliate of the seller, any option or other
agreement to sell, or any filing of or any agreement to give any security
interest).
"Moody's" means Xxxxx'x Investors Service, Inc. and its successors.
"Net Cash Proceeds" means, with respect to any Asset Sale, the
proceeds of such Asset Sale in the form of cash or cash equivalents, including
payments in respect of deferred payment obligations (to the extent corresponding
to the principal, but not interest, component thereof) when received in the form
of cash or cash equivalents (except to the extent such obligations are financed
or sold with recourse to the Company or any Restricted Subsidiary) and proceeds
from the conversion of other property received or to be received when converted
to cash or cash equivalents, net of (i) brokerage commissions and other fees and
expenses (including fees and expenses of counsel and investment bankers) related
to such Asset Sale; (ii) provisions for all taxes (whether or not such taxes
will actually be paid or are payable) as a result of such Asset Sale without
regard to the consolidated results of operations of the Company and its
Restricted Subsidiaries, taken as a whole; (iii) payments made to repay
Indebtedness or any other obligation outstanding at the time of such Asset Sale
that either (A) is secured by a Lien on the property or assets sold or (B) is
required to be paid as a result of such sale and (iv) appropriate amounts to be
provided by the Company or any Restricted Subsidiary as a reserve against any
liabilities associated with such Asset Sale, including, without limitation,
pension and other post-employment benefit liabilities, liabilities related to
environmental matters and liabilities under any indemnification obligations
associated with such Asset Sale, all as determined in conformity with GAAP.
"Net Proceeds" means, with respect to any issuance or sale of Capital
Stock, the aggregate net proceeds of such issuance or sale in the form of cash
or cash equivalents, including payments in respect of deferred payment
obligations (to the extent corresponding to the principal, but not interest,
component thereof) when received in the form of cash or cash equivalents (except
to the extent such obligations are financed or sold with recourse to the Company
or any Restricted Subsidiary of the Company), and the fair market value of
non-cash proceeds constituting Capital Stock of a corporation engaged in the
business of the Company and its Restricted Subsidiaries or similar or related,
ancillary or complementary businesses (the fair market value of which shall be
determined in good faith by the Board of Directors, whose determination shall be
conclusive and evidenced by a Board Resolution), in
22
each case net of attorney's fees, accountants' fees, underwriters' or placement
agents' fees, discounts or commissions and brokerage, consultant and other fees
incurred in connection with such issuance or sale and net of taxes paid or
payable as a result thereof.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Officer" means, with respect to the Company, (i) the Chairman of the
Board of Directors, the President, any Vice President, the Chief Financial
Officer, and (ii) the Treasurer or any Assistant Treasurer, or the Secretary or
any Assistant Secretary.
"Officers' Certificate" means a certificate signed by the Chairman of
the Board of Directors or the President or any Vice President (whether or not
designated by a number or numbers or a word or words added before or after the
title "Vice President") of the Company and delivered to the Trustee. Each such
certificate shall comply with Section 314 of the Trust Indenture Act of 1939 and
include the statements provided for in Section 12.05.
"Opinion of Counsel" means an opinion in writing signed by legal
counsel who may be an employee of or counsel to the Company or who may be other
counsel satisfactory to the Trustee. Each such opinion shall comply with Section
314 of the Trust Indenture Act of 1939 and include the statements provided for
in Section 12.05, and such others as may reasonably be requested by the Trustee,
if and to the extent required hereby.
"outstanding", when used with reference to Securities, subject to the
provisions of Article Twelve, means, as of any particular time, all Securities
authenticated and delivered by the Trustee under this Indenture, except
(a) Securities theretofore canceled by the Trustee or delivered to
the Trustee for cancellation;
(b) Securities, or portions thereof, for the payment or redemption
of which moneys in the necessary amount shall have been deposited in
trust with the Trustee or with any paying agent (other than the
Company) or shall have been set aside, segregated and held in trust
by the Company (if the Company shall act as its own paying agent),
provided that if such Securities are to be redeemed prior to the
maturity thereof, notice of such redemption shall have been given as
herein provided, or provision satisfactory to the Trustee shall have
been made for giving such notice; and
23
(c) Securities in substitution for which other Securities shall
have been authenticated and delivered, or which shall have been paid,
pursuant to the terms of Section 2.08 (unless proof satisfactory to
the Trustee and the Company is presented that any of such Securities
is held by a person in whose hands such Security is a legal, valid
and binding obligation of the Company).
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency, instrumentality or
political subdivision thereof.
"Preferred Stock" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated,
whether voting or non-voting) of such Person's preferred or preference stock,
whether now outstanding or hereafter issued, including, without limitation, all
series and classes of such preferred or preference stock.
"principal" wherever used with reference to the Securities or any
Security or any portion thereof, shall be deemed to include "and premium, if
any".
"Public Equity Offering" means an underwritten primary public
offering of common stock of the Company pursuant to an effective registration
statement under the Securities Act of 1933, as amended.
"Redeemable Stock" means any class or series of Capital Stock of any
Person that by its terms or otherwise is (i) required to be redeemed prior to
the Stated Maturity of the Securities, (ii) redeemable at the option of the
holder of such class or series of Capital Stock at any time prior to the Stated
Maturity of the Securities or (iii) convertible into or exchangeable for Capital
Stock referred to in clause (i) or (ii) above or Indebtedness having a scheduled
maturity prior to the Stated Maturity of the Securities; provided that any
Capital Stock that would not constitute Redeemable Stock but for provisions
thereof giving holders thereof the right to require such Person to repurchase or
redeem such Capital Stock upon the occurrence of an "asset sale" or "change of
control" occurring prior to the Stated Maturity of the Securities shall not
constitute Redeemable Stock if the "asset sale" or "change of control"
provisions applicable to such Capital Stock are no more favorable to the holders
of such Capital Stock than the provisions contained in Sections 3.10 and 3.17
and such Capital Stock specifically provides that such Person will not
repurchase or redeem any such stock pursuant to such provision prior to the
Company's repurchase of such Securities as are required to be repurchased
pursuant to Section 3.10 or 3.17. Notwithstanding the foregoing, Capital Stock
shall not be deemed to be Redeemable
24
Stock if it may only be so redeemed solely in consideration of Capital Stock
that is not Redeemable Stock.
"Regular Record Date" for the Interest payable on any Interest
Payment Date (except a date for payment of defaulted interest) means the ____ or
____ (whether or not a Business Day) as the case may be, next preceding such
Interest Payment Date.
"Reorganization" means that series of transactions which shall be
consummated on the Issue Date pursuant to which (i) all of the stock of ZD Inc.
(formerly Xxxx-Xxxxx Inc.) and ZD COMDEX and Forums Inc. will be contributed to
the Company in exchange for 74,200,000 shares of the Company's Common Stock,
(ii) certain obligations owed to SOFTBANK Corp. will be converted to equity,
(iii) the Company shall issue and sell in an initial public offering 25,800,000
shares of its Common Stock and the Securities, (iv) the Company shall enter into
the Credit Agreement and borrow $1.25 billion thereunder and (v) the Company
shall apply the proceeds of the sale of its Common Stock and the Securities
referred to in clause (iii) and the borrowings under the Credit Agreement
referred to in clause (iv) to purchase from MAC Inc. certain operations and
assets relating to certain publications and trade shows and to repay certain
indebtedness owed to SOFTBANK Corp. and its Affiliates, which transactions shall
be deemed to take place simultaneously on the Issue Date, all as further
described in the Company's Registration Statement on Form S-1 (File No.
333-46493).
"Restricted Investment" means any Investment by the Company or any
Restricted Subsidiary in any Person other than (i) an Investment in the Company
or a Restricted Subsidiary or in any Person that, as a result of such
Investment, becomes a Restricted Subsidiary or will be merged or consolidated
with or into or transfer or convey all or substantially all its assets to, the
Company or a Restricted Subsidiary; provided that such person's primary business
is related, ancillary or complementary to the businesses of the Company and its
Restricted Subsidiaries on the date of such Investment, (ii) Temporary Cash
Investments and (iii) any non-cash consideration received in connection with an
Asset Sale that was made in compliance with Section 3.10.
"Restricted Subsidiary" means any Subsidiary other than an
Unrestricted Subsidiary.
"Responsible Officer" when used with respect to the Trustee means any
vice president (whether or not designated by numbers or words added before or
after the title "vice president"), any trust officer, any assistant trust
officer, any assistant vice president, any assistant secretary, any assistant
treasurer, or any other officer or assistant officer of the Trustee customarily
performing functions similar to those performed by the persons who at the time
shall be such officers, respectively, or to
25
whom any corporate trust matter is referred because of his or her knowledge of
and familiarity with the particular subject.
"Security" or "Securities" means any Security or Securities, as the
case may be, authenticated and delivered under this Indenture.
"Senior Indebtedness" means the following obligations of the Company,
whether outstanding on the Issue Date or thereafter Incurred: (i) all
Indebtedness and all other monetary obligations (including expenses, fees and
other monetary obligations) of the Company under the Credit Agreement and (ii)
all other Indebtedness of the Company (other than the Securities), including
principal and interest on such Indebtedness, unless such Indebtedness, by its
terms or by the terms of any agreement or instrument pursuant to which such
Indebtedness is issued, is pari passu with, or subordinated in right of payment
to, the Securities; provided that the term "Senior Indebtedness" shall not
include (a) any Indebtedness of the Company that, when Incurred, was without
recourse to the Company, (b) any Indebtedness of the Company to a Subsidiary of
the Company, or to a joint venture in which the Company has an interest, (c) any
Indebtedness of the Company, to the extent not permitted by Section 3.09 (but as
to any such Indebtedness under the Credit Agreement, no such violation shall be
deemed to exist for purposes of this clause (c) if the Bank Agent shall have
received a representation from an Officer of the Company to the effect that the
issuance of such Indebtedness does not violate such covenant), (d) any
Indebtedness to any employee of the Company or any of its Subsidiaries, (e) any
liability for taxes owed or owing by the Company, (f) any Trade Payables or (g)
any Capital Stock. Senior Indebtedness will also include interest accruing on or
after, or which would accrue but for, events of bankruptcy of the Company and
its Subsidiaries at the rate provided for in the document governing such Senior
Indebtedness, whether or not such interest is an allowed claim enforceable
against the Indebtednessor in a bankruptcy case under bankruptcy law.
"Senior Subordinated Obligations" means any principal of, premium, if
any, or interest on the Securities payable pursuant to the terms of the
Securities or upon acceleration, including any amounts received upon the
exercise of rights of rescission or other rights of action (including claims for
damages) or otherwise, to the extent relating to the purchase price of the
Securities or amounts corresponding to such principal, premium, if any, or
interest on the Securities.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article One, Rule 1-02 of Regulation S-X
promulgated under the Securities Act of 1933, as amended, as such Regulation is
in effect on the date hereof.
"S&P" means Standard & Poor's Rating's Service and its successors.
26
"Stated Maturity" means (i) with respect to any debt security, the
date specified in such debt security as the fixed date on which the final
installment of principal of such debt security is due and payable and (ii) with
respect to any scheduled installment of principal of or interest on any debt
security, the date specified in such debt security as the fixed date on which
such installment is due and payable.
"Subordinated Obligations" means any Indebtedness of the Company
(whether outstanding on the Issue Date or thereafter Incurred) which is
subordinated or junior in right of payment to the Securities.
"Subsidiary" means, with respect to any Person, any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person (or a combination
thereof). Unless otherwise specified, "Subsidiary" means a Subsidiary of the
Company.
"Temporary Cash Investment" means any of the following: (i) U.S.
Government Obligations, (ii) time deposit accounts, certificates of deposit and
money market deposits maturing within 180 days of the date of acquisition
thereof issued by a bank or trust company which is organized under the laws of
the United States of America, any state thereof or any foreign country
recognized by the United States, and which bank or trust company has capital,
surplus and undivided profits aggregating in excess of $50 million (or the
foreign currency equivalent thereof) and has outstanding debt which is rated
"P-1" (or higher) according to Moody's or "A-1" (or higher) according to S&P or
any money market fund sponsored by a registered broker dealer or mutual fund
distributor, (iii) repurchase obligations with a term of not more than 30 days
for underlying securities of the types described in clause (i) above entered
into with a bank meeting the qualifications described in clause (ii) above, (iv)
commercial paper, maturing not more than 90 days after the date of acquisition,
issued by a corporation (other than an Affiliate of the Company) organized and
in existence under the laws of the United States of America, any state thereof
or any foreign country recognized by the United States of America with a rating
at the time as of which any investment therein is made of "P-1" (or higher)
according to Moody's or "A-1" (or higher) according to S&P, (v) securities with
maturities of six months or less from the date of acquisition issued or fully
and unconditionally guaranteed by any state, commonwealth or territory of the
United States of America, or by any political subdivision or taxing authority
thereof, and rated at least "P-1" (or higher) according to Moody's or "A-1" (or
higher) according to S&P and (vi) money market funds which invest substantially
all of their assets in securities described in the preceding clauses (i) through
(v).
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"Trade Payables" means, with respect to any Person, any accounts
payable or any other indebtedness or monetary obligation to trade creditors
created, assumed or Guaranteed by such Person or any of its Subsidiaries arising
in the ordinary course of business in connection with the acquisition of goods
or services.
"Transaction Date" means, with respect to the Incurrence of any
Indebtedness by the Company or any of its Restricted Subsidiaries, the date such
Indebtedness is to be Incurred and, with respect to any Restricted Payment, the
date such Restricted Payment is to be made.
"Trust Indenture Act of 1939" means the Trust Indenture Act of 1939,
as amended, as in force at the date as of which this Indenture was originally
executed, and "TIA", when used in respect of an indenture supplemental hereto,
means such Act as in force at the time such indenture supplemental hereto
becomes effective.
"Trustee" means the entity identified as "Trustee" in the first
paragraph hereof and, subject to the provisions of Article Five, shall also
include any successor trustee.
"U.S. Government Obligations" means securities issued or directly and
fully guaranteed or insured by the United States of America or any agent or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof).
"Unrestricted Subsidiary" means (i) any Subsidiary that at the time
of determination shall be designated an Unrestricted Subsidiary by the Board of
Directors in the manner provided below and (ii) any Subsidiary of an
Unrestricted Subsidiary. The Board of Directors may designate any Restricted
Subsidiary (including any newly acquired or newly formed Subsidiary) to be an
Unrestricted Subsidiary unless such Subsidiary owns any Capital Stock of, or
owns or holds any Lien on any property of, the Company or any Restricted
Subsidiary; provided that (A) any Guarantee by the Company or any Restricted
Subsidiary of any Indebtedness of the Subsidiary being so designated shall be
deemed an "Incurrence" of such Indebtedness and an "Investment" by the Company
or such Restricted Subsidiary (or both, if applicable) at the time of such
designation, (B) either (I) the Subsidiary to be so designated has total assets
of $1,000 or less or (II) if such Subsidiary has assets greater than $1,000,
such designation would be permitted under Section 3.08, and (C) if applicable,
the Incurrence of Indebtedness and the Investment referred to in clause (A) of
this proviso would be permitted under Sections 3.08 and 3.09. The Board of
Directors may designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided that immediately after giving effect to such designation
(x) the Company could Incur $1.00 of additional Indebtedness under the first
paragraph of Section 3.09 and (y) no Default or Event of Default shall have
occurred and be continuing. Any
28
such designation by the Board of Directors shall be evidenced to the Trustee by
promptly filing with the Trustee a copy of the Board Resolution giving effect to
such designation and an officers' certificate certifying that such designation
complied with the foregoing provisions.
"Voting Stock" means with respect to any Person, Capital Stock of any
class or kind ordinarily having the power to vote for the election of directors,
managers or other voting members of the governing body of such Person.
"Wholly Owned" means, with respect to any Subsidiary of any Person,
such Subsidiary if all of the outstanding Capital Stock or other similar equity
ownership interests (but not including Preferred Stock) in such Subsidiary
(other than any director's qualifying shares or Investments by foreign nationals
mandated by applicable law) is owned directly or indirectly by such Person.
"ZDTV Acquisition" means the acquisition of an interest in ZDTV LLC
and/or ZD Television Productions, Inc. held by MAC Holdings America, Inc.
(whether such acquisition is consummated by the Company directly or indirectly,
by acquisition of assets, stock or joint venture interests, or otherwise)
pursuant to the License and Services Agreement among ZD Inc. (formerly Xxxx-
Xxxxx Inc.), ZDTV LLC, ZD Television Productions, Inc., MAC Holdings America,
Inc. and MAC Inc. dated as of July 28, 1997, and any renewal, amendment or
extension thereof.
SECTION 1.02. Other Definitions.
Defined in
Term Section
---- -------
"Acceleration Notice".......................................................... 4.02
"Agent Members"................................................................ 2.07
"Change of Control Offer"...................................................... 3.17
"Change of Control Offer Expiration Date"...................................... 3.17
"Change of Control Payment".................................................... 3.17
"Change of Control Payment Date"............................................... 3.17
"Covenant Defeasance".......................................................... 11.03
"Excess Proceeds".............................................................. 3.10
"Excess Proceeds Offer"........................................................ 3.10
"Excess Proceeds Offer Expiration Date"........................................ 3.10
"Excess Proceeds Payment"...................................................... 3.10
"Excess Proceeds Payment Date"................................................. 3.10
"Global Security".............................................................. 2.04
"Guaranteed Indebtedness"...................................................... 3.15
"Legal Defeasance"............................................................. 11.02
"Payment Blockage Period"...................................................... 9.03
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Defined in
Term Section
---- -------
"Permitted Indebtedness"....................................................... 3.09
"Permitted Refinancing Indebtedness"........................................... 3.09
"Registrar".................................................................... 2.06
"Related Party Transaction".................................................... 3.14
"Restricted Payments".......................................................... 3.08
"Secured Indebtedness"......................................................... 3.11
"Security Register"............................................................ 2.06
"Subsidiary Guarantee"......................................................... 3.15
ARTICLE 2
ISSUE, EXECUTION, FORM AND REGISTRATION OF SECURITIES
SECTION 2.01. Authentication and Delivery of Securities. Upon the
execution and delivery of this Indenture, or from time to time thereafter,
Securities in an aggregate principal amount not in excess of the amount
specified in the form of Security hereinabove recited (except as otherwise
provided in Section 2.08) may be executed by the Company and delivered to the
Trustee for authentication, and the Trustee shall thereupon authenticate and
make available for delivery said Securities to or upon the written order of the
Company, signed by its Chairman of the Board of Directors, or any Vice Chairman
of the Board of Directors, or its President or any Vice President (whether or
not designated by a number or numbers or a word or words added before or after
the title "Vice President") without any further action by the Company.
SECTION 2.02. Execution of Securities. The Securities shall be signed
on behalf of the Company by its Chairman of the Board of Directors or its
President or any Vice President (whether or not designated by a number or
numbers or a word or words added before or after the title "Vice President").
Such signature may be the manual or facsimile signatures of the present or any
future such officers.
In case any officer of the Company who shall have signed any of the
Securities shall cease to be such officer before the Security so signed shall be
authenticated and delivered by the Trustee or disposed of by the Company, such
Security nevertheless may be authenticated and delivered or disposed of as
though the person who signed such Security had not ceased to be such officer of
the Company; and any Security may be signed on behalf of the Company by such
persons as, at the actual date of the execution of such Security, shall be the
proper officers of the Company, although at the date of the execution and
delivery of this Indenture any such person was not such officer.
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SECTION 2.03. Certificate of Authentication. Only such Securities as
shall bear thereon a certificate of authentication substantially in the form
hereinabove recited, executed by the Trustee by manual signature of one of its
authorized signatories, shall be entitled to the benefits of this Indenture or
be valid or obligatory for any purpose. Such certificate by the Trustee upon any
Security executed by the Company shall be conclusive evidence that the Security
so authenticated has been duly authenticated and delivered hereunder and that
the Holder is entitled to the benefits of this Indenture.
SECTION 2.04. Form, Denomination and Date of Securities; Payments of
Interest. The Securities and the Trustee's certificates of authentication shall
be substantially in the form recited above. The Securities shall be issuable in
denominations provided for in the form of Security recited above. The Securities
shall be numbered, lettered, or otherwise distinguished in such manner or in
accordance with such plans as the officers of the Company executing the same may
determine with the approval of the Trustee.
Any of the Securities may be issued with appropriate insertions,
omissions, substitutions and variations, and may have imprinted or otherwise
reproduced thereon such legend or legends, not inconsistent with the provisions
of this Indenture, as may be required to comply with any law or with any rules
or regulations pursuant thereto, including those required by Section 2.05, or
with the rules of any securities market in which the Securities are admitted to
trading, or to conform to general usage.
Each Security shall be dated the date of its authentication, shall
bear interest from the applicable date and shall be payable on the dates
specified on the face of the form of Security recited above.
The Securities shall be issued initially in the form of one or more
global Securities (a "Global Security") deposited with the Trustee as custodian
for the Depositary.
The person in whose name any Security is registered at the close of
business on any Regular Record Date with respect to any Interest Payment Date
shall be entitled to receive the interest, if any, payable on such Interest
Payment Date notwithstanding any transfer or exchange of such Security
subsequent to the Regular Record Date and prior to such Interest Payment Date,
except if and to the extent the Company shall default in the payment of the
interest due on such Interest Payment Date, in which case such defaulted
interest, plus (to the extent lawful) any interest payable on the defaulted
interest, shall be paid to the persons in whose names outstanding Securities are
registered at the close of business on a subsequent record date (which shall be
not less than five Business Days prior to the date of such
31
payment) established by notice given by mail by or on behalf of the Company to
the holders of Securities not less than 15 days preceding such subsequent record
date.
SECTION 2.05. Global Security Legends. Each Global Security shall
bear the following legends on the face thereof:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, 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 TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY OR
SUCH OTHER REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY
PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED
TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES
OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE.
SECTION 2.06. Registration, Transfer and Exchange. The Securities are
issuable only in registered form. The Company will keep at each office or agency
to be maintained for the purpose as provided in Section 3.02 (the "Registrar") a
register or registers (the "Security Register(s)") in which, subject to such
reasonable regulations as it may prescribe, it will register, and will register
the transfer of, Securities as in this Article provided. Such Security Register
shall be in written form in the English language or in any other form capable of
being converted into such form within a reasonable time. At all reasonable times
such Security Register or Security Registers shall be open for inspection by the
Trustee.
Upon due presentation for registration of transfer of any Security at
each such office or agency, the Company shall execute and the Trustee shall
authenticate and make available for delivery in the name of the transferee or
transferees a new
32
Security or Securities in authorized denominations for a like aggregate
principal amount.
A Holder may transfer a Security only by written application to the
Registrar stating the name of the proposed transferee and otherwise complying
with the terms of this Indenture. No such transfer shall be effected until, and
such transferee shall succeed to the rights of a Holder only upon, final
acceptance and registration of the transfer by the Registrar in the Security
Register. Prior to the registration of any transfer by a Holder as provided
herein, the Company, the Trustee, and any agent of the Company shall treat the
person in whose name the Security is registered as the owner thereof for all
purposes whether or not the Security shall be overdue, and neither the Company,
the Trustee, nor any such agent shall be affected by notice to the contrary.
Furthermore, any Holder of a Global Security shall, by acceptance of such Global
Security, agree that transfers of beneficial interests in such Global Security
may be effected only through a book entry system maintained by the Holder of
such Global Security (or its agent) and that ownership of a beneficial interest
in the Security shall be required to be reflected in a book entry. When
Securities are presented to the Registrar or a co-Registrar with a request to
register the transfer or to exchange them for an equal principal amount of
Securities of other authorized denominations, the Registrar shall register the
transfer or make the exchange as requested if the requirements for such
transactions set forth herein are met. To permit registrations of transfers and
exchanges, the Company shall execute and the Trustee shall authenticate
Securities at the Registrar's request.
The Company may require payment of a sum sufficient to cover any tax
or other similar governmental charge that may be imposed in connection with any
exchange or registration of transfer of Securities (other than any such transfer
taxes or other similar governmental charge payable upon exchanges pursuant to
Section 2.10, 7.05 or 10.03). No service charge to any Holder shall be made for
any such transaction.
The Company shall not be required to exchange or register a transfer
of (a) any Securities for a period of 15 days next preceding the first mailing
of notice of redemption of Securities to be redeemed, or (b) any Securities
selected, called or being called for redemption except, in the case of any
Security where public notice has been given that such Security is to be redeemed
in part, the portion thereof not so to be redeemed.
All Securities issued upon any transfer or exchange of Securities
shall be valid obligations of the Company, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Securities
surrendered upon such transfer or exchange.
33
SECTION 2.07. Book-Entry Provisions for Global Securities. (a) Each
Global Security shall (i) be registered in the name of the Depositary for such
Global Securities or the nominee of such Depositary, (ii) be delivered to the
Trustee as custodian for such Depositary and (iii) bear legends as set forth in
Section 2.05.
Members of, or participants in, the Depositary ("Agent Members")
shall have no rights under this Indenture with respect to any Global Security
held on their behalf by the Depositary, or the Trustee as its custodian, or
under the Global Security, and the Depositary may be treated by the Company, the
Trustee and any agent of the Company or the Trustee as the absolute owner of
such Global Security for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Trustee or any agent of the
Company or the Trustee, from giving effect to any written certification, proxy
or other authorization furnished by the Depositary or impair, as between the
Depositary and its Agent Members, the operation of customary practices governing
the exercise of the rights of a holder of any Security.
(b) Transfers of a Global Security shall be limited to transfers of
such Global Security in whole, but not in part, to the Depositary, its
successors or their respective nominees. Interests of beneficial owners in a
Global Security may be transferred in accordance with the rules and procedures
of the Depositary. In addition, Certificated Securities shall be transferred to
all beneficial owners in exchange for their beneficial interests if (i) the
Depositary notifies the Company that it is unwilling or unable to continue as
Depositary for the Global Security or the Depository ceases to be a "clearing
agency" registered under the Exchange Act and a successor depositary is not
appointed by the Company within 90 days of such notice or (ii) an Event of
Default of which a Responsible Officer of the Trustee has actual notice has
occurred and is continuing and the Registrar has received a request from the
Depositary to issue such Certificated Securities.
(c) In connection with the transfer of the entire Global Security to
beneficial owners pursuant to paragraph (b) of this Section, such Global
Security shall be deemed to be surrendered to the Trustee for cancellation, and
the Company shall execute, and the Trustee shall authenticate and deliver, to
each beneficial owner identified by the Depositary in exchange for its
beneficial interest in such Global Security an equal aggregate principal amount
of Certificated Securities of authorized denominations.
(d) The registered holder of a Global Security may grant proxies and
otherwise authorize any person, including Agent Members and persons that may
hold interests through Agent Members, to take any action which a Holder is
entitled to take under this Indenture or the Securities.
34
SECTION 2.08. Mutilated, Defaced, Destroyed, Lost and Stolen
Securities. In case any temporary or definitive Security shall become mutilated,
defaced or be apparently destroyed, lost or stolen, the Company in its
discretion may execute, and upon the written request of any officer of the
Company, the Trustee shall authenticate and make available for delivery, a new
Security, bearing a number not contemporaneously outstanding, in exchange and
substitution for the mutilated or defaced Security, or in lieu of and
substitution for the Security so apparently destroyed, lost or stolen. In every
case the applicant for a substitute Security shall furnish to the Company and to
the Trustee and any agent of the Company or the Trustee such security or
indemnity as may be required by them to indemnify and defend and to save each of
them harmless and, in every case of destruction, loss or theft evidence to their
satisfaction of the apparent destruction, loss or theft of such Security and of
the ownership thereof.
Upon the issuance of any substitute Security, the Company may require
the payment of a sum sufficient to cover any transfer tax or other similar
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
In case any Security which has matured or is about to mature, or has been called
for redemption in full, shall become mutilated or defaced or be apparently
destroyed, lost or stolen, the Company may, instead of issuing a substitute
Security, pay or authorize the payment of the same (without surrender thereof
except in the case of a mutilated or defaced Security), if the applicant for
such payment shall furnish to the Company and to the Trustee and any agent of
the Company or the Trustee such security or indemnity as any of them may require
to save each of them harmless from all risks, however remote, and, in every case
of apparent destruction, loss or theft, the applicant shall also furnish to the
Company and the Trustee and any agent of the Company or the Trustee evidence to
their satisfaction of the apparent destruction, loss or theft of such Security
and of the ownership thereof.
Every substitute Security issued pursuant to the provisions of this
Section by virtue of the fact that any Security is apparently destroyed, lost or
stolen shall constitute an additional contractual obligation of the Company,
whether or not the apparently destroyed, lost or stolen Security shall be at any
time enforceable by anyone and shall be entitled to all the benefits of (but
shall be subject to all the limitations of rights set forth in) this Indenture
equally and proportionately with any and all other Securities duly authenticated
and delivered hereunder. All Securities shall be held and owned upon the express
condition that, to the extent permitted by law, the foregoing provisions are
exclusive with respect to the replacement or payment of mutilated, defaced, or
apparently destroyed, lost or stolen Securities and shall preclude any and all
other rights or remedies notwithstanding any law or statute existing or
hereafter enacted to the contrary with respect to the replacement or payment of
negotiable instruments or other securities without their surrender.
35
SECTION 2.09. Cancellation of Securities. All Securities surrendered
for payment, redemption, registration of transfer or exchange, if surrendered to
the Company or any agent of the Company or the Trustee, shall be delivered to
the Trustee for cancellation or, if surrendered to the Trustee, shall be
cancelled by it; and no Securities shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this Indenture. If the Company
shall acquire any of the Securities, such acquisition shall not operate as a
redemption or satisfaction of the indebtedness represented by such Securities
unless and until the same are delivered to the Trustee for cancellation.
SECTION 2.10. Temporary Securities. Pending the preparation of
definitive Securities, the Company may execute and, upon receipt of an order
from the Company, the Trustee shall authenticate and make available for delivery
temporary Securities (printed, lithographed, typewritten or otherwise
reproduced, in each case in form satisfactory to the Trustee). Temporary
Securities shall be issuable as registered Securities without coupons, of any
authorized denomination, and substantially in the form of the definitive
Securities but with such omissions, insertions and variations as may be
appropriate for temporary Securities, all as may be determined by the Company
with the concurrence of the Trustee. Temporary Securities may contain such
reference to any provisions of this Indenture as may be appropriate. Every
temporary Security shall be executed by the Company and be authenticated by the
Trustee upon the same conditions and in substantially the same manner, and with
like effect, as the definitive Securities. Without unreasonable delay the
Company shall execute and shall furnish definitive Securities and thereupon
temporary Securities may be surrendered in exchange therefor without charge at
each office or agency to be maintained by the Company for the purpose pursuant
to Section 3.02, and the Trustee shall authenticate and make available for
delivery in exchange for such temporary Securities a like aggregate principal
amount of definitive Securities of authorized denominations. Until so exchanged
the temporary Securities shall be entitled to the same benefits under this
Indenture as definitive Securities.
SECTION 2.11. CUSIP and CINS Numbers. The Company in issuing the
Securities may use "CUSIP" and "CINS" numbers (if then generally in use), and
the Trustee shall use CUSIP numbers and CINS numbers, as the case may be, in
notices of redemption or exchange as a convenience to Holders; provided that any
such notice shall state that no representation is made as to the correctness of
such numbers either as printed on the Securities or as contained in any notice
of redemption or exchange and that reliance may be placed only on the other
identification numbers printed on the Securities. The Company shall promptly
notify the Trustee of any change in the CUSIP number or CINS number, as the case
may be.
36
ARTICLE 3 COVENANTS OF THE
COMPANY AND THE TRUSTEE.
SECTION 3.01. Payment of Principal and Interest. The Company
covenants and agrees that it will duly and punctually pay or cause to be paid
the principal of, and interest on, each of the Securities at the place or
places, at the respective times and in the manner provided in the Securities.
Each installment of interest on the Securities may be paid by mailing checks for
such interest payable to or upon the written order of the holders of Securities
entitled thereto as they shall appear on the registry books of the Company, or
by wire transfer to such holders in immediately available funds, to such bank or
other entity in the continental United States as shall be designated by such
holders and shall have appropriate facilities for such purpose, or in accordance
with the standard operating procedures of the Depositary.
SECTION 3.02. Offices for Payments, etc. So long as any of the
Securities remain outstanding, the Company will maintain in the Borough of
Manhattan, The City of New York, the following: (a) an office or agency where
the Securities may be presented for payment, (b) an office or agency where the
Securities may be presented for registration of transfer and for exchange as in
this Indenture provided and (c) an office or agency where notices and demands to
or upon the Company in respect of the Securities or of this Indenture may be
served. The Company will give to the Trustee written notice of the location of
any such office or agency and of any change of location thereof. The Company
hereby initially designates the Corporate Trust Office of the Trustee as the
office or agency for each such purpose. In case the Company shall fail to
maintain any such office or agency or shall fail to give such notice of the
location or of any change in the location thereof, presentations and demands may
be made and notices may be served at the Corporate Trust Office.
SECTION 3.03. Appointment to Fill a Vacancy in Office of Trustee. The
Company, whenever necessary to avoid or fill a vacancy in the office of Trustee,
will appoint, in the manner provided in Section, a Trustee, so that there shall
at all times be a Trustee hereunder.
SECTION 3.04. Paying Agents. Whenever the Company shall appoint a
paying agent other than the Trustee, it will cause such paying agent to execute
and deliver to the Trustee an instrument in which such agent shall agree with
the Trustee, subject to the provisions of this Section,
(a) that it will hold all sums received by it as such agent for the
payment of the principal of or interest on the Securities (whether such sums
have been paid to it by the Company or by any other obligor on the Securities)
in trust for the benefit of the holders of the Securities or of the Trustee,
37
(b) that it will give the Trustee notice of any failure by the
Company (or by any other obligor on the Securities) to make any payment of the
principal of or interest on the Securities when the same shall be due and
payable, and
(c) that it will pay any such sums so held in trust by it to the
Trustee upon the Trustee's written request at any time during the continuance of
the failure referred to in clause (b) above.
The Company will, prior to each due date of the principal of or
interest on the Securities, deposit with the paying agent a sum sufficient to
pay such principal or interest, and (unless such paying agent is the Trustee)
the Company will promptly notify the Trustee of any failure to take such action.
If the Company shall act as its own paying agent, it will, on or
before each due date of the principal of or interest on the Securities, set
aside, segregate and hold in trust for the benefit of the holders of the
Securities a sum sufficient to pay such principal or interest so becoming due.
The Company will promptly notify the Trustee of any failure to take such action.
Anything in this Section to the contrary notwithstanding, the Company
may at any time, for the purpose of obtaining a satisfaction and discharge of
this Indenture or for any other reason, pay or cause to be paid to the Trustee
all sums held in trust by the Company or any paying agent hereunder, as required
by this Section, such sums to be held by the Trustee upon the trusts herein
contained.
Anything in this Section to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section are subject to the
provisions of Sections 11.05 and 11.06.
SECTION 3.05. Certificates to Trustee. (a) The Company will deliver
to the Trustee within 90 days after the end of each fiscal year of the Company a
certificate from the principal executive, financial or accounting officer of the
Company stating that such officer has conducted or supervised a review of the
activities of the Company and its Restricted Subsidiaries and the Company's and
its Restricted Subsidiaries' performance under the Indenture and that, to the
best of such officer's knowledge, based upon such review, the Company has
fulfilled all obligations thereunder or, if there has been a default in the
fulfillment of any such obligation (determined without regard to any period of
grace or requirement of notice provided in the Indenture), specifying each such
default and the nature and status thereof.
(b) The Company will deliver to the Trustee, as soon as possible and
in any event within 10 days after the Company becomes aware or should reasonably
become
38
aware of the occurrence of an Event of Default or a Default, an Officers'
Certificate setting forth the details of such Event of Default or Default, and
the action which the Company proposes to take with respect thereto.
(c) The Company will deliver to the Trustee within 90 days after the
end of each fiscal year of the Company a written statement by the Company's
independent public accountants stating (i) that their audit examination has
included a review of the terms of this Indenture and the Securities as they
relate to accounting matters, and (ii) whether, in connection with their audit
examination, any Default has come to their attention and, if such a Default has
come to their attention, specifying the nature and period of the existence
thereof.
SECTION 3.06. Securityholders' Lists. If and so long as the Trustee
shall not be the Registrar, the Company will furnish or cause to be furnished to
the Trustee a list in such form as the Trustee may reasonably require of the
names and addresses of the holders of the Securities pursuant to Section 312 of
the Trust Indenture Act of 1939 (a) semi-annually not more than 15 days after
each Regular Record Date as of such Regular Record Date, and (b) at such other
times as the Trustee may request in writing, within thirty days after receipt by
the Company of any such request as of a date not more than 15 days prior to the
time such information is furnished.
SECTION 3.07. Reports by the Trustee. (a) The Trustee shall transmit
to Holders such reports concerning the Trustee and its actions under this
Indenture as may be required pursuant to the Trust Indenture Act of 1939 at the
times and in the manner provided pursuant thereto. If required by Section 313(a)
of the Trust Indenture Act of 1939, the Trustee shall, within sixty days after
each May 15 following the date of this Indenture deliver to Holders a brief
report, dated as of such May 15, which complies with the provisions of such
Section 313(a).
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange, if
any, upon which the Securities are listed, with the Commission and with the
Company. The Company will promptly notify the Trustee when the Securities are
listed on any stock exchange or of any delisting thereof.
SECTION 3.08. Limitation on Restricted Payments. The Company will
not, and will not permit any Restricted Subsidiary to, directly or indirectly
(such payments and other actions described in clauses (i) through (iv) being
collectively "Restricted Payments"):
(i) declare or pay any dividend or make any distribution on its
Capital Stock (other than (x) dividends or distributions payable
solely in shares of its or such Restricted Subsidiary's Capital Stock
(other than
39
Redeemable Stock) or in options, warrants or other rights to acquire
shares of Capital Stock (other than Redeemable Stock) or (y) pro rata
dividends or distributions on Common Stock of Restricted Subsidiaries
held by minority stockholders) held by Persons other than the Company
or any of its Wholly Owned Restricted Subsidiaries;
(ii) purchase, redeem, retire or otherwise acquire for value any
shares of Capital Stock of the Company or any Subsidiary (including
options, warrants or other rights to acquire such shares of Capital
Stock) held by Persons other than the Company or any of its Wholly
Owned Restricted Subsidiaries;
(iii) make any voluntary or optional principal payment, or voluntary
or optional redemption, repurchase, defeasance, or other acquisition
or retirement for value of any Subordinated Obligations or any
intercompany debt owed to SOFTBANK Corp. or its Affiliates (other
than the Company and its Restricted Subsidiaries); provided, that
this clause (iii) shall not apply to the Existing Softbank Note; or
(iv) make any Investment that is a Restricted Investment;
if, at the time of, and after giving effect to, the proposed Restricted Payment:
(A) a Default or Event of Default shall have occurred and be continuing, (B) the
Company could not Incur at least $1.00 of Indebtedness under the first paragraph
of Section 3.09 or (C) the aggregate amount expended for all Restricted Payments
(the amount so expended, if other than in cash, to be determined in good faith
by the Board of Directors, whose determination shall be conclusive and evidenced
by a Board Resolution) after the Issue Date would exceed the sum of (1) the
remainder of (x) the aggregate amount of Consolidated EBITDA (or, if the
Consolidated EBITDA is negative, minus 100% of such negative amount) accrued on
a cumulative basis during the period (taken as one accounting period) beginning
on the first day of the fiscal quarter during which the Issue Date occurs and
ending on the last day of the last fiscal quarter preceding the Transaction Date
for which reports have been filed pursuant to Section 3.19 minus (y) the product
of 1.4 multiplied by the aggregate amount of Consolidated Interest Expense
accrued on a cumulative basis for the period referred to in clause (x) plus (2)
the Net Proceeds received by the Company from the issuance and sale permitted by
the Indenture of its Capital Stock (other than Redeemable Stock) to a Person who
is not a Subsidiary, including an issuance or sale permitted by the Indenture of
Indebtedness of the Company subsequent to the Issue Date upon the conversion or
exchange of such Indebtedness into Capital Stock (other than Redeemable Stock)
of the Company, or from the issuance to any Person who is not a Subsidiary of
any options, warrants or other rights to acquire Capital Stock of the Company
(in each case, exclusive of any Redeemable Stock or any options,
40
warrants or other rights to acquire Redeemable Stock) plus (3) an amount equal
to the net reduction in Restricted Investments in any Person resulting from
payments of dividends, repayments of loans or advances, or other transfers of
assets, in each case to the Company or any Restricted Subsidiary or from the Net
Cash Proceeds from the sale of any such Investment (except, in each case, to the
extent any such payment or proceeds are included in the calculation of Adjusted
Consolidated Net Income), or from redesignations of Unrestricted Subsidiaries as
Restricted Subsidiaries (valued in each case as provided in the definition of
"Investments"), not to exceed, in each case, the amount of Investments
previously made by the Company and any Restricted Subsidiary in such Person or
Unrestricted Subsidiary.
The foregoing provision shall not be violated by reason of: (i) the
payment of any dividend within 60 days after the date of declaration thereof if,
at said date of declaration, such payment would comply with the foregoing
paragraph; (ii) the redemption, repurchase, defeasance or other acquisition or
retirement for value of Subordinated Obligations including premium, if any, and
accrued and unpaid interest, with the proceeds of, or in exchange for, Permitted
Refinancing Indebtedness; (iii) the repurchase, redemption or other acquisition
of Capital Stock of the Company in exchange for, or out of the proceeds of a
substantially concurrent offering of, shares of Capital Stock (other than
Redeemable Stock) of the Company; (iv) the making of any principal payment or
the repurchase, retirement, defeasance or other acquisition for value of
Subordinated Obligations of the Company in exchange for, or out of the proceeds
of, a substantially concurrent offering of, shares of the Capital Stock of the
Company (other than Redeemable Stock); (v) the purchase, redemption,
acquisition, cancellation or other retirement for value of shares of Capital
Stock of the Company, options on any such shares or related stock appreciation
rights or similar securities held by officers or employees or former officers or
employees (or their estates or beneficiaries under their estates), upon death,
disability, retirement, severance or termination of employment or pursuant to
any agreement under which such shares of stock or related rights were issued;
provided that the aggregate cash consideration paid for such purchase,
redemption, acquisition, cancellation or other retirement of such shares of
Capital Stock or related rights after the Issue Date does not exceed an
aggregate amount of $10 million in any twelve month period; (vi) Investments
acquired in exchange for Capital Stock (other than Redeemable Stock) of the
Company; (vii) payments or distributions pursuant to or in connection with a
consolidation, merger or transfer of assets that complies with the provisions of
the Indenture applicable to mergers, consolidations and transfers of all or
substantially all of the property and assets of the Company, (viii) Investments
by the Company or any of its Restricted Subsidiaries in a joint venture or joint
ventures with any Person or Persons in an aggregate amount not to exceed $75
million, provided that such joint venture or joint ventures is or are engaged in
a business that is similar or related, ancillary or complementary to the nature
or type of the business of the Company and its Restricted Subsidiaries and joint
venture
41
companies existing on the date of such Investment (as determined in good faith
by the Board of Directors, whose determination shall be conclusive and evidenced
by a Board Resolution) and provided, further, that the Company may make up to
$150 million of additional Investments under this clause (viii) in lieu of
Investments permitted to be made, but not made, pursuant to clause (ix) hereof,
(ix) Investments by the Company or any of its Restricted Subsidiaries in an
aggregate amount not to exceed $150 million in connection with the ZDTV
Acquisition; provided, that the amount of such Investments permitted under this
clause (ix) shall be reduced by the amount of Investments in excess of $75
million made pursuant to clause (viii) hereof; or (x) any other Restricted
Payment which, together with all other Restricted Payments made pursuant to this
clause (x) since the Issue Date, does not exceed $25 million; provided that,
except in the case of clauses (i) and (iii), no Default or Event of Default
shall have occurred and be continuing or occur as a consequence of the actions
or payments set forth therein. The amount of any Restricted Payments permitted
pursuant to clauses (viii), (ix) or (x) above shall be determined after giving
effect to the net reduction in the amount of any Investment made pursuant to
such clause (viii), (ix) or (x), respectively, to the extent contemplated by
clause (3) of the first paragraph above of this Section 3.08.
Each Restricted Payment permitted pursuant to the preceding paragraph
(excluding Restricted Payments referred to in clauses (ii), (vi), (viii) and
(ix)) and the Net Proceeds from any issuance of Capital Stock referred to in
clauses (iii), (iv) and (vi) shall (without duplication) be included in
calculating whether the conditions of clause (C) of the second preceding
paragraph have been met with respect to any subsequent Restricted Payments.
SECTION 3.09. Limitation on Indebtedness. The Company will not, and
will not permit any of its Restricted Subsidiaries to, Incur any Indebtedness;
provided that the Company may Incur Indebtedness or Acquired Indebtedness and
any Restricted Subsidiary may Incur Acquired Indebtedness, if, on the date of
such Incurrence, after giving pro forma effect to the Incurrence of such
Indebtedness and the receipt and application of the proceeds therefrom, the
Consolidated Leverage Ratio would be less than or equal to 7.0 to 1, for
Indebtedness Incurred on or prior to March 31, 1999, or 6.0 to 1, for
Indebtedness Incurred thereafter.
Notwithstanding the foregoing, the Company and, to the extent
provided below, any Restricted Subsidiary may Incur the following (each,
"Permitted Indebtedness"):
(i) Indebtedness of the Company Incurred under the Credit
Agreement, or Guarantees thereof pursuant to the Credit Agreement, in
an aggregate principal amount at any time outstanding not to exceed
$1.65
42
billion less any amount of Indebtedness permanently repaid as
provided under Section 3.10;
(ii) Indebtedness of the Company or any Restricted Subsidiary to the
Company or any Wholly Owned Restricted Subsidiary as long as such
Indebtedness continues to be owed to the Company or any Wholly Owned
Restricted Subsidiary;
(iii) Indebtedness of the Company pursuant to the Securities and
Indebtedness of any Guarantor pursuant to a Subsidiary Guarantee of
the Securities;
(iv) Indebtedness consisting of Guarantees by a Person that becomes
a Restricted Subsidiary of Indebtedness Incurred by the Company to
finance the acquisition of such Person, provided, that the Incurrence
of the Indebtedness being Guaranteed is permitted under the
Indenture;
(v) Indebtedness consisting of Guarantees by Restricted
Subsidiaries which Guarantees are permitted to be Incurred under
Section 3.15;
(vi) Indebtedness of the Company or any Restricted Subsidiary
("Permitted Refinancing Indebtedness") issued in exchange for, or the
net proceeds of which are used to refinance or refund, then
outstanding Indebtedness (other than Indebtedness of the Company
pursuant to the Credit Agreement), in an amount not to exceed the
amount so refinanced or refunded (plus premiums, accrued interest,
fees and expenses); provided that Indebtedness the proceeds of which
are used to refinance or refund the Securities or Indebtedness that
is pari passu with, or subordinated in right of payment to, the
Securities shall only be permitted under this clause (vi) if (A) in
case the Securities are refinanced in part or the Indebtedness to be
refinanced is pari passu with the Securities, such new Indebtedness,
by its terms or by the terms of any agreement or instrument pursuant
to which such new Indebtedness is outstanding, is expressly made pari
passu with, or subordinate in right of payment to, the remaining
Securities, (B) in case the Indebtedness to be refinanced is
subordinated in right of payment to the Securities, such new
Indebtedness, by its terms or by the terms of any agreement or
instrument pursuant to which such new Indebtedness is outstanding, is
expressly made subordinate in right of payment to the Securities at
least to the extent that the Indebtedness to be refinanced is
subordinated to the Securities and (C) such new Indebtedness,
determined as of the date of Incurrence of such new Indebtedness,
does not mature prior to the Stated Maturity of the Indebtedness to
be refinanced or refunded, and the
43
Average Life of such new Indebtedness is at least equal to the
remaining Average Life of the Indebtedness to be refinanced or
refunded; and provided further that in no event may Indebtedness of
the Company be refinanced pursuant to this clause (vi) by means of
any Indebtedness of any Restricted Subsidiary;
(vii) Indebtedness of the Company or any Restricted Subsidiary (A) in
respect of bid, performance, surety or appeal bonds provided in the
ordinary course of business consistent with past practice, (B) under
Currency Agreements and Interest Rate Agreements (provided that such
Currency Agreements do not increase the Indebtedness of the obligor
outstanding at any time other than as a result of fluctuations in
foreign currency exchange rates or by reason of fees, indemnities and
compensation payable thereunder) or (C) arising from agreements
providing for indemnification, adjustment of purchase price or
similar obligations, or from Guarantees or letters of credit, surety
bonds or performance bonds securing any obligations of the Company
pursuant to such agreements, in any case Incurred in connection with
the disposition of any business, assets or Restricted Subsidiary
(other than Guarantees of Indebtedness Incurred by any Person
acquiring all or any portion of such business, assets or Restricted
Subsidiary for the purpose of financing such acquisition), in a
principal amount not to exceed the gross proceeds actually received
by the Company or any Restricted Subsidiary in connection with such
disposition;
(viii) Indebtedness of the Company or any Restricted Subsidiary
under letters of credit and bankers' acceptances issued in the
ordinary course of business;
(ix) Indebtedness of the Company, to the extent the net proceeds
thereof are promptly (A) used to purchase Securities tendered in an
Offer to Purchase made as a result of a Change in Control or (B)
deposited to defease the Securities pursuant to Article Eleven;
(x) Indebtedness of the Company or any Restricted Subsidiary
outstanding on the Issue Date (other than Indebtedness described in
clause (i), (ii) or (iii) of this Section 3.09);
(xi) Indebtedness of the Company or any Restricted Subsidiary in an
aggregate principal amount at any time outstanding not to exceed $100
million ; and
(xii) Indebtedness of Restricted Subsidiaries in an aggregate
principal amount at any time outstanding not to exceed $200 million,
provided, that,
44
after giving pro forma effect to the Incurrence of such Indebtedness
and the application of the proceeds therefrom, the Company could
Incur at least $1.00 of Indebtedness under the first paragraph of
this Section 3.09.
For purposes of determining compliance with this section, (A) in the
event that an item of Indebtedness meets the criteria of more than one of the
types of Indebtedness described in the clauses of the preceding paragraph, the
Company, in its sole discretion, shall classify such item of Indebtedness and
only be required to include the amount and type of such Indebtedness in one of
such clauses, (B) an item of Indebtedness may be divided and classified in more
than one of the types of Indebtedness described above and (C) the amount of
Indebtedness issued at a price that is less than the principal amount thereof
shall be equal to the amount of the liability in respect thereof determined in
conformity with GAAP.
SECTION 3.10. Limitation on Asset Sales. The Company will not, and
will not permit any Restricted Subsidiary to, consummate any Asset Sale unless:
(i) such Asset Sale is effected at not less than fair market value (as
determined in good faith by the Board of Directors); and (ii) either (x) at
least 75% of the consideration is received in cash, Temporary Cash Investments
or the assumption of Indebtedness (other than Subordinated Obligations) or (y)
the consideration therefor received by the Company or any Restricted Subsidiary
is in the form of equity or debt securities of the transferee of such assets;
provided, that Asset Sales pursuant to this clause (y) shall not exceed an
aggregate of $25 million in any twelve month period. In the event and to the
extent that the Net Cash Proceeds received by the Company or its Restricted
Subsidiaries from one or more Asset Sales occurring on or after the Issue Date
in any period of 12 consecutive months exceed $20 million, the Company, shall,
or shall cause one or more of its Restricted Subsidiaries to, (1) within twelve
months after the date such Net Cash Proceeds exceed $20 million, (A) apply an
amount equal to such excess Net Cash Proceeds to permanently repay Senior
Indebtedness of the Company or Indebtedness of any Restricted Subsidiary, as the
case may be, in each case owing to a Person other than the Company or any of its
Restricted Subsidiaries or (B) invest an equal amount, or the amount not so
applied pursuant to clause (A) (or enter into a definitive agreement committing
to so invest within 12 months after the date of such agreement), in the business
of the Company and its Restricted Subsidiaries as of the date of application of
such amounts (or in Capital Stock of a Restricted Subsidiary or a Person engaged
either in the same business as the Company or any of its Restricted Subsidiaries
or a business related, ancillary or complementary thereto that, as a result of
such Investment, becomes a Restricted Subsidiary) and (2) apply such excess Net
Cash Proceeds (to the extent not applied pursuant to clause (1) above) as
provided in the following three paragraphs. The amount of such excess Net Cash
Proceeds required to be applied (or to be committed to be applied) during such
12-month period as set forth in clause (1) of
45
the preceding sentence and not applied as so required by the end of such period
shall constitute "Excess Proceeds."
If, as of the first day of any calendar month, the aggregate amount
of Excess Proceeds not theretofore subject to an Excess Proceeds Offer (as
defined below) totals at least $20 million, the Company must, not later than the
fifteenth Business Day of such month, make an offer (an "Excess Proceeds Offer")
to purchase from the Holders on a pro rata basis an aggregate principal amount
of Securities equal to the Excess Proceeds on such date, at a purchase price
equal to 100% of the principal amount of the Securities, plus, in each case,
accrued interest (if any) to the date of purchase (the "Excess Proceeds
Payment").
The Company will commence an Excess Proceeds Offer by mailing a
notice to the Trustee and each Holder stating: (i) that the Excess Proceeds
Offer is being made pursuant to Section 3.10 of the Indenture and that all
Securities validly tendered will be accepted for payment on a pro rata basis;
(ii) the purchase price and the expiration date for such Excess Proceeds Offer
(which shall be the date not less than 20 Business Days from the date such
notice is mailed) (the "Excess Proceeds Offer Expiration Date"); (iii) that any
Security not tendered will continue to accrue interest pursuant to its terms;
(iv) that, unless the Company defaults in the payment of the Excess Proceeds
Payment, any Security accepted for payment pursuant to the Excess Proceeds Offer
shall cease to accrue interest on and after the Excess Proceeds Payment Date (as
defined below); (v) that Holders electing to have a Security purchased pursuant
to the Excess Proceeds Offer will be required to surrender the Security,
together with the form entitled "Option of the Holder to Elect Purchase" on the
reverse side of the Security completed, to the paying agent at the address
specified in the notice prior to the close of business on the Excess Proceeds
Offer Expiration Date; (vi) that Holders will be entitled to withdraw their
election if the paying agent receives, not later than the close of business on
the Excess Proceeds Offer Expiration Date, a facsimile transmission or letter
setting forth the name of such Holder, the principal amount of Securities
delivered for purchase and a statement that such Holder is withdrawing his
election to have such Securities purchased; and (vii) that Holders whose
Securities are being purchased only in part will be issued new Securities equal
in principal amount to the unpurchased portion of the Securities surrendered;
provided that each Security purchased and each new Security issued shall be in a
principal amount of $1,000 or integral multiples thereof.
On a date no more than four Business Days after the Excess Proceeds
Offer Expiration Date (the "Excess Proceeds Payment Date"), the Company will (i)
accept for payment on a pro rata basis Securities or portions thereof tendered
pursuant to the Excess Proceeds Offer; (ii) deposit with the paying agent money
sufficient to pay the purchase price of all Securities or portions thereof so
accepted; and (iii) deliver, or cause to be delivered, to the Trustee all
Securities or portions
46
thereof so accepted together with an Officers' Certificate specifying the
Securities or portions thereof accepted for payment by the Company. The paying
agent shall promptly mail to the Holders of Securities so accepted payment in an
amount equal to the purchase price, and the Trustee shall promptly authenticate
and mail to such Holders a new Security equal in principal amount to any
unpurchased portion of the Security surrendered; provided that each Security
purchased and each new Security issued shall be in a principal amount of $1,000
or integral multiples thereof. The Company will publicly announce the results of
the Excess Proceeds Offer as soon as practicable after the Excess Proceeds Offer
Expiration Date. For purposes of this Section 3.10, the Trustee shall act as the
paying agent.
The Company will comply with Rule 14e-1 under the Exchange Act and
any other securities laws and regulations thereunder to the extent such laws and
regulations are applicable, in the event that such Excess Proceeds are received
by the Company under this Section 3.10 and the Company is required to repurchase
Securities as described in this Section 3.10.
SECTION 3.11. Limitation on Liens. The Company shall not Incur any
Indebtedness secured by a Lien ("Secured Indebtedness") which is not Senior
Indebtedness (or Indebtedness that would constitute Senior Indebtedness except
that it is without recourse to the Company) unless contemporaneously therewith
effective provision is made to secure the Securities equally and ratably with
(or, if the Secured Indebtedness is subordinated in right of payment to the
Securities, prior to) such Secured Indebtedness for so long as such Secured
Indebtedness is secured by a Lien.
SECTION 3.12. Limitation on Dividend and Other Payment Restrictions
Affecting Restricted Subsidiaries. The Company will not, and will not permit any
Restricted Subsidiary to, create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction of any kind on the ability
of any Restricted Subsidiary to (i) pay dividends or make any other
distributions permitted by applicable law on any Capital Stock of such
Restricted Subsidiary owned by the Company or any other Restricted Subsidiary,
(ii) pay any Indebtedness or other obligations owed to the Company or any other
Restricted Subsidiary, (iii) make loans or advances to the Company or any other
Restricted Subsidiary or (iv) transfer any of its property or assets to the
Company or any other Restricted Subsidiary.
The foregoing provisions shall not restrict any encumbrances or
restrictions: (i) existing on the Issue Date in the Credit Agreement, the
Indenture or any other agreements in effect on the Issue Date, and any
extensions, amendments, refinancings, renewals or replacements of any of the
foregoing; provided that the encumbrances and restrictions in any such
extensions, amendments, refinancings, renewals or replacements are no less
favorable in any material respect to the Holders than those encumbrances or
restrictions that are then in effect and that are being
47
extended, amended, refinanced, renewed or replaced; (ii) existing under or by
reason of applicable law; (iii) existing with respect to any Person or the
property or assets of such Person acquired by the Company or any Restricted
Subsidiary and existing at the time of such acquisition, which encumbrances or
restrictions (A) are not applicable to any Person or the property or assets of
any Person other than such Person or the property or assets of such Person so
acquired and (B) were not put in place in anticipation of such acquisition, and
any extensions, refinancings, renewals or replacements of any of the foregoing;
provided that the encumbrances and restrictions in any such extensions,
refinancings, renewals or replacements are no less favorable in any material
respect to the Holders than those encumbrances or restrictions that are then in
effect and that are being extended, refinanced, renewed or replaced; (iv) in the
case of clause (iv) of the preceding paragraph, (A) that restrict in a customary
manner the subletting, assignment or transfer of any property or asset that is
subject to a lease, license, conveyance or contract, (B) existing by virtue of
any transfer of, agreement to transfer, option or right with respect to, or Lien
on, any property or assets of the Company or any Restricted Subsidiary not
otherwise prohibited by the Indenture or (C) arising or agreed to in the
ordinary course of business, not relating to any Indebtedness and, that do not,
individually or in the aggregate, detract from the value of property or assets
of the Company or any Restricted Subsidiary in any manner material to the
Company or any Restricted Subsidiary; (v) with respect to a Restricted
Subsidiary and imposed pursuant to an agreement that has been entered into for
the sale or disposition of all or substantially all of the Capital Stock of, or
property and assets of, such Restricted Subsidiary or (vi) contained in the
terms of any Indebtedness or any agreement pursuant to which such Indebtedness
was issued if (A) the encumbrance or restriction applies only in the event of a
payment default or a default with respect to a financial covenant contained in
such Indebtedness or agreement, (B) the encumbrance or restriction is not
materially more disadvantageous to the Holders of the Securities than is
customary in comparable financings (as determined by the Company) and (C) the
Company determines that any such encumbrance or restriction will not materially
affect the Company's ability to make principal or interest payments on the
Securities. Nothing contained in the preceding paragraph shall prevent the
Company or any Restricted Subsidiary from (1) creating, incurring, assuming or
permitting to exist any Lien otherwise not prohibited by the Indenture or (2)
restricting the sale or other disposition of property or assets of the Company
or any of its Restricted Subsidiaries that secure Indebtedness of the Company or
any of its Restricted Subsidiaries.
SECTION 3.13. Limitation on Senior Subordinated Indebtedness. The
Company shall not Incur any Indebtedness that is subordinate in right of payment
to any Senior Indebtedness unless such Indebtedness is pari passu with, or
subordinated in right of payment to, the Securities; provided that the foregoing
limitation shall not apply to distinctions between categories of Senior
Indebtedness of the Company that
48
exist by reason of any Liens or Guarantees arising or created in respect of some
but not all such Senior Indebtedness.
SECTION 3.14. Limitation on Transactions with Shareholders and
Affiliates. The Company will not, and will not permit any Restricted Subsidiary
to, directly or indirectly, enter into, renew or extend any transaction
(including, without limitation, the purchase, sale, lease or exchange of
property or assets, or the rendering of any service) with any holder (or any
Affiliate of such holder) of 5% or more of any class of Capital Stock of the
Company or with any Affiliate of the Company or any Restricted Subsidiary (each,
a "Related Party Transaction"), except upon fair and reasonable economic terms
no less favorable to the Company or such Restricted Subsidiary than could be
obtained, at the time of such transaction or at the time of the execution of the
agreement providing therefor, in a comparable arm's-length transaction with a
Person that is not such a holder or an Affiliate.
In addition and without limiting the foregoing, (i) any Related Party
Transaction or series of Related Party Transactions with an aggregate value in
excess of $5 million must first be approved by a majority of the Board of
Directors of the Company who are disinterested in the subject matter of the
transaction pursuant to a Board Resolution, and (ii) with respect to any Related
Party Transaction or series of Related Party Transactions with an aggregate
value in excess of $10 million, the Company must first obtain a favorable
written opinion from a nationally recognized investment banking firm or
nationally recognized independent accounting or consulting firm as to the
fairness from a financial point of view of such transaction to the Company or
such Subsidiary, as the case may be.
The foregoing limitation does not limit, and shall not apply to (i)
any transaction between the Company and any of its Restricted Subsidiaries or
between Restricted Subsidiaries, (ii) the payment of reasonable and customary
regular fees to directors of the Company who are not employees of the Company,
(iii) any Restricted Payments not prohibited by Section 3.08 or (iv)
transactions pursuant to Existing Affiliate Agreements.
SECTION 3.15. Limitation on the Issuance of Guarantees by Restricted
Subsidiaries. The Company will not permit any Restricted Subsidiary, directly or
indirectly, to Guarantee any Indebtedness of the Company or any Restricted
Subsidiary (except Indebtedness of a Restricted Subsidiary of such Restricted
Subsidiary) ("Guaranteed Indebtedness"), unless (i) such Restricted Subsidiary
simultaneously executes and delivers a supplemental indenture to the Indenture
providing for a Guarantee (a "Subsidiary Guarantee") of payment of the
Securities by such Restricted Subsidiary and (ii) such Restricted Subsidiary
waives and will not in any manner whatsoever claim or take the benefit or
advantage of any rights of reimbursement, indemnity or subrogation or any other
rights against the Company
49
or any other Restricted Subsidiary as a result of any payment by such Restricted
Subsidiary under its Subsidiary Guarantee; provided that this paragraph shall
not be applicable to (I) any Guarantee of any Restricted Subsidiary that existed
at the time such Person became a Restricted Subsidiary and was not Incurred in
connection with, or in contemplation of, such Person becoming a Restricted
Subsidiary, (II) Guarantees permitted under clause (iv) of the second paragraph
of Section 3.09, (III) any Guarantee by any Restricted Subsidiary of
Indebtedness Incurred under the Credit Agreement and permitted by the Indenture,
(IV) any Guarantee by any Restricted Subsidiary of Indebtedness Incurred by the
Company under any senior commercial term loan and/or revolving credit facility
entered into principally with commercial banks and/or other financial
institutions typically party to commercial loan agreements and permitted by the
Indenture or (V) any Guarantee by any Restricted Subsidiary of Indebtedness
Incurred by another Restricted Subsidiary and permitted by the Indenture. If the
Guaranteed Indebtedness is (A) pari passu with the Securities, then the
Guarantee of such Guaranteed Indebtedness shall be pari passu with, or
subordinated to, the Subsidiary Guarantee or (B) subordinated to the Securities,
then the Guarantee of such Guaranteed Indebtedness shall be subordinated to the
Subsidiary Guarantee at least to the extent that the Guaranteed Indebtedness is
subordinated to the Securities.
Notwithstanding the foregoing, any Subsidiary Guarantee by a
Restricted Subsidiary shall provide by its terms that it shall be automatically
and unconditionally released and discharged upon (i) any sale, exchange or
transfer to any Person not an Affiliate of the Company, of all of the Capital
Stock of such Restricted Subsidiary directly or indirectly owned by the Company,
or all or substantially all the assets of such Restricted Subsidiary (which
sale, exchange or transfer is not prohibited by the Indenture) or (ii) the
release or discharge of the Guarantee which resulted in the creation of such
Subsidiary Guarantee, except a discharge or release by or as a result of payment
under such Guarantee.
SECTION 3.16. Limitation on the Issuance of Capital Stock of
Restricted Subsidiaries. The Company will not sell, and will not permit any
Restricted Subsidiary, directly or indirectly, to issue or sell any shares of
Capital Stock of a Restricted Subsidiary (including options, warrants or other
rights to purchase shares of such Capital Stock) except (i) to the Company or a
Wholly Owned Restricted Subsidiary, (ii) issuances or sales to foreign nationals
of shares of Capital Stock of foreign Restricted Subsidiaries, to the extent
required by applicable law, (iii) if, immediately after giving effect to such
issuance or sale, such Restricted Subsidiary would no longer constitute a
Restricted Subsidiary; provided that any Investment in such Person remaining
after giving effect to such issuance or sale would have been permitted to be
made under Section 3.08, if made on the date of such issuance or sale, (iv) to
the extent such shares represent directors' qualifying shares or (v) issuances
or sales of Common Stock of a Restricted Subsidiary that remains a
50
Restricted Subsidiary after such transaction, the Net Cash Proceeds from which
are applied in compliance with clause (A) or (B) of Section 3.10.
SECTION 3.17. Repurchase of Securities Upon a Change of Control. Upon
the occurrence of a Change of Control, each Holder shall have the right to
require the repurchase of its Securities by the Company in cash pursuant to the
offer described below (the "Change of Control Offer") at a purchase price equal
to 101% of the principal amount thereof, plus accrued interest (if any) to the
date of purchase (the "Change of Control Payment"). Prior to the mailing of the
notice to Holders provided for in the succeeding paragraph, but in any event
within 30 days following any Change of Control, the Company covenants to (i)
repay in full all indebtedness of the Company that would prohibit the repurchase
of the Securities as provided for in the succeeding paragraph or (ii) obtain any
requisite consents under instruments governing any such indebtedness of the
Company to permit the repurchase of the Securities as provided for in the
succeeding paragraph. The Company shall first comply with the covenant in the
preceding sentence before it shall be required to repurchase Securities pursuant
to this Section 3.17.
Within 30 days of the Change of Control, the Company shall mail a
notice to the Trustee and each Holder stating: (i) that a Change of Control has
occurred (and a brief description of the events resulting in such Change of
Control), that the Change of Control Offer is being made pursuant to Section
3.17 of the Indenture and that all Securities validly tendered will be accepted
for payment; (ii) the purchase price and the expiration date for such Change of
Control Offer (which shall be the date not less than 20 Business Days from the
date such notice is mailed) (the "Change of Control Offer Expiration Date");
(iii) that any Security not tendered will continue to accrue interest pursuant
to its terms; (iv) that, unless the Company defaults in the payment of the
Change of Control Payment, any Security accepted for payment pursuant to the
Change of Control Offer shall cease to accrue interest on and after the Change
of Control Payment Date (as defined below); that Holders electing to have any
Security or portion thereof purchased pursuant to the Change of Control Offer
will be required to surrender such Security, together with the form entitled
"Option of the Holder to Elect Purchase" on the reverse side of such Security
completed, to the paying agent at the address specified in the notice prior to
the close of business on the Change of Control Offer Expiration Date; (vi) that
Holders will be entitled to withdraw their election if the paying agent
receives, not later than the close of business on the Change of Control Offer
Expiration Date, a facsimile transmission or letter setting forth the name of
such Holder, the principal amount of Securities delivered for purchase and a
statement that such Holder is withdrawing his election to have such Securities
purchased; and (vii) that Holders whose Securities are being purchased only in
part will be issued new Securities equal in principal amount to the unpurchased
portion of the Securities surrendered; provided that each Security
51
purchased and each new Security issued shall be in a principal amount of $1,000
or integral multiples thereof.
On a date no more than four Business Days after the Change of Control
Offer Expiration Date (the "Change of Control Payment Date"), the Company will:
(i) accept for payment Securities or portions thereof tendered pursuant to the
Change of Control Offer; (ii) deposit with the paying agent money sufficient to
pay the purchase price of all Securities or portions thereof so accepted; and
(iii) deliver, or cause to be delivered, to the Trustee, all Securities or
portions thereof so accepted together with an Officers' Certificate specifying
the Securities or portions thereof accepted for payment by the Company. The
paying agent shall promptly mail, to the Holders of Securities so accepted,
payment in an amount equal to the purchase price, and the Trustee shall promptly
authenticate and mail to such Holders a new Security equal in principal amount
to any unpurchased portion of the Securities surrendered; provided that each
Security purchased and each new Security issued shall be in a principal amount
of $1,000 or integral multiples thereof. The Company will publicly announce the
results of the Change of Control Offer on or as soon as practicable after the
Change of Control Offer Expiration Date. For purposes of this Section, the
Trustee shall act as paying agent.
The Company will not be required to make a Change of Control Offer if
a third party makes an offer to purchase Securities in the manner, at the times
and otherwise in compliance with the requirements set forth in the Indenture
applicable to the Change of Control Offer to be made by the Company and
purchases all Securities validly tendered and not withdrawn under such offer to
purchase.
The Company will comply with Rule 14e-1 under the Exchange Act and
any other securities laws and regulations thereunder to the extent such laws and
regulations are applicable in the event that a Change of Control occurs and the
Company is required to repurchase the Securities under this Section.
SECTION 3.18. Limitation of Applicability of Certain Covenants if
Securities Rated Investment Grade. The Company's and its Restricted
Subsidiaries' obligations to comply with Sections 3.08, 3.09, 3.10, 3.12, 3.13,
3.14 and 3.16 will terminate if and when the Securities are Investment Grade
Rated.
SECTION 3.19. SEC Reports. (i) So long as any of the Securities
remain outstanding, whether or not the Company is then required to file with the
Commission information, documents or reports pursuant to Section 13 or Section
15(d) of the Exchange Act, the Company will file with the Trustee and the
Commission, in accordance with rules and regulations prescribed from time to
time by the Commission, such of the supplementary and periodic information,
documents and reports which would be required pursuant to such sections if the
Company were
52
subject thereto. All obligors on the Securities will comply with Section 314(a)
of the Trust Indenture Act of 1939.
(ii) The Company shall promptly mail copies of all such annual
reports, information, documents and other reports provided to the Trustee
pursuant to Section 3.19(a)(i) hereof to the Holders at their addresses
appearing in the register of Securities maintained by the Registrar. The Company
shall also make such information available to securities analysts and
prospective investors upon request.
(iii) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
SECTION 3.20. Existence. Subject to Articles Three and Eight of this
Indenture, the Company will do or cause to be done all things necessary to
preserve and keep in full force and effect its existence and the existence of
each of its Restricted Subsidiaries in accordance with the respective
organizational documents of the Company and each such Subsidiary and the rights
(whether pursuant to charter, partnership certificate, agreement, statute or
otherwise), material licenses and franchises of the Company and each such
Subsidiary, provided that the Company shall not be required to preserve any such
right, license or franchise, or the existence of any Restricted Subsidiary, if
the maintenance or preservation thereof is no longer desirable in the conduct of
the business of the Company and its Restricted Subsidiaries taken as a whole.
SECTION 3.21. Payment of Taxes and Other Claims. The Company will pay
or discharge and shall cause each of its Subsidiaries to pay or discharge, or
cause to be paid or discharged, before the same shall become delinquent (a) all
material taxes, assessments and governmental charges levied or imposed upon (i)
the Company or any such Subsidiary, (ii) the income or profits of any such
Subsidiary which is a corporation or (iii) the property of the Company or any
such Subsidiary and (b) all material lawful claims for labor materials and
supplies that, if unpaid, might by law become a lien upon the property of the
Company or any such Subsidiary; provided that the Company shall not be required
to pay of discharge, or cause to be paid or discharged, any such tax,
assessment, charge or claim the amount, applicability or validity of which is
being contested in good faith by appropriate proceedings and for which adequate
reserves have been established.
SECTION 3.22. Maintenance of Properties and Insurance. The Company
will cause all properties used or useful in the conduct of its business or the
business of
53
any of its Restricted 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, betterments and
improvements thereof, all as in the judgment of the Company may be necessary so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times; provided that nothing in this Section
3.22 shall prevent the Company or any such Subsidiary from discontinuing the
use, operation or maintenance of any of such properties or disposing of any of
them, if such discontinuance or disposal is, in the judgment of the Company,
desirable in the conduct of the business of the Company or such Subsidiary.
The Company will provide or cause to be provided, for itself and its
Restricted Subsidiaries, insurance (including appropriate self-insurance)
against loss or damage of the kinds customarily insured against by corporations
similarly situated and owning like properties, including, but not limited to,
products liability insurance and public liability insurance, with reputable
insurers or with the government of the United States of America, or an agency or
instrumentality thereof, in such amounts, with such deductibles and by such
methods as shall be customary for corporations similarly situated in the
industry in which the Company or such Restricted Subsidiary, as the case may be,
is then conducting business.
SECTION 3.23. Waiver of Stay, Extension or Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not (i) at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury law or other law
that would prohibit or forgive the Company from paying all or any portion of the
principal of or interest on the Securities as contemplated herein, wherever
enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this Indenture and the Company will expressly
waive all benefit or advantage of any such law and (ii) hinder, delay or impede
the execution of any power granted to the Trustee under this Indenture and will
suffer and permit the execution of every such power as though no such law had
been enacted.
ARTICLE 4
REMEDIES OF THE TRUSTEE AND HOLDERS ON EVENT OF DEFAULT
SECTION 4.01. Events of Default. Each of the following constitutes
an "Event of Default":
54
(a) default in the payment of principal of, or premium, if any, on
any Security when the same becomes due and payable at maturity, upon
acceleration, redemption or otherwise; whether or not such payment is prohibited
by the provisions of Article Nine.
(b) default in the payment of interest on any Security when the same
becomes due and payable, and such default continues for a period of 30 days;
whether or not such payment is prohibited by the provisions of Article Nine;
(c) default in the performance or breach of the provisions of the
Indenture applicable to mergers, consolidations and transfers of all or
substantially all of the assets of the Company or the failure to purchase
Securities tendered in a Change of Control Offer or Excess Proceeds Offer in
accordance with Section 3.10 or Section 3.17;
(d) the Company or any Guarantor defaults in the performance of or
breaches any other covenant or agreement in the Indenture or under the
Securities (other than (a), (b) or (c) above) and such default or breach
continues for a period of 60 consecutive days after written notice by the
Trustee or the Holders of 25% or more in aggregate principal amount of the
Securities;
(e) there occurs with respect to any issue or issues of Indebtedness
of the Company or any of its Significant Subsidiaries having an outstanding
principal amount of $25 million individually or $50 million in the aggregate for
all such issues of all such Persons, whether such Indebtedness now exists or
shall hereafter be created, (i) an event of default that has caused the holder
thereof to declare such Indebtedness to be due and payable prior to its Stated
Maturity and such Indebtedness has not been discharged in full or such
acceleration has not been rescinded or annulled within 60 days of such
acceleration and/or (ii) the failure to make a principal payment at the final
(but not any interim) fixed maturity and such defaulted payment shall not have
been made, waived or extended within 60 days of such payment default;
(f) any final judgment or order for the payment of money in excess
of $25 million in the aggregate for all such final judgments or orders against
all such Persons shall be rendered against the Company and/or any of its
Significant Subsidiaries and shall not be paid or discharged, and there shall be
any period of 60 consecutive days following entry of the final judgment or order
that causes the aggregate amount for all such final judgments or orders
outstanding and not paid or discharged or bonded against all such Persons to
exceed $25 million (in excess of amounts which the Company's insurance carriers
have agreed to pay under applicable policies) during which a stay of enforcement
of such final judgment or order, by reason of a pending appeal or otherwise,
shall not be in effect;
55
(g) a court having jurisdiction in the premises enters a decree or
order for (A) relief in respect of the Company or any of its Significant
Subsidiaries in an involuntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, (B) appointment of a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official of
the Company or any of its Significant Subsidiaries or for all or substantially
all of the property and assets of the Company or any of its Significant
Subsidiaries or (C) the winding up or liquidation of the affairs of the Company
or any of its Significant Subsidiaries and, in each case, such decree or order
shall remain unstayed and in effect for a period of 60 consecutive days; or
(h) the Company or any of its Significant Subsidiaries (A) commences
a voluntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or consents to the entry of an order for relief
in an involuntary case under any such law, (B) consents to the appointment of or
taking possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Company or any of its Significant
Subsidiaries or for all or substantially all of the property and assets of the
Company or any of its Significant Subsidiaries or (C) effects any general
assignment for the benefit of creditors.
SECTION 4.02. Acceleration. If an Event of Default (other than an
Event of Default specified in clause (g) or (h) of Section 4.01 that occurs with
respect to the Company) occurs and is continuing under the Indenture, the
Trustee or the Holders of at least 25% in aggregate principal amount of the
Securities then outstanding, by written notice to the Company (and to the
Trustee if such notice is given by the Holders (the "Acceleration Notice")),
may, and the Trustee at the request of such Holders shall, declare the principal
of, premium, if any, and accrued interest on the Securities to be immediately
due and payable. Upon a declaration of acceleration, such principal of, premium,
if any, and accrued interest shall be immediately due and payable; provided,
however, that if there are any amounts outstanding under the Credit Agreement,
such declaration shall not become effective until the earlier of (i) an
acceleration of the Indebtedness under the Credit Agreement and (ii) 5 Business
Days after receipt by the Company and the Bank Agent of such Acceleration
Notice. In the event of a declaration of acceleration because an Event of
Default set forth in clause (f) of Section 4.01 has occurred and is continuing,
such declaration of acceleration shall be automatically rescinded and annulled
if the event of default triggering such Event of Default pursuant to clause (e)
of Section 4.01 shall be remedied or cured by the Company or the relevant
Significant Subsidiary or waived by the holders of the relevant Indebtedness
within 60 days after the declaration of acceleration with respect thereto. If an
Event of Default specified in clause (g) or (h) of Section 4.01 occurs with
respect to the Company, the principal of, premium, if any, and accrued interest
on the Securities then outstanding shall ipso facto become
56
and be immediately due and payable without any declaration or other act on the
part of the Trustee or any Holder.
SECTION 4.03. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal or interest on the Securities or to enforce the performance of any
provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. All remedies are cumulative
to the extent permitted by law.
SECTION 4.04. Waiver of Past Defaults. The Holders of at least a
majority in principal amount of the outstanding Securities by written notice to
the Company and to the Trustee, may waive all past defaults and rescind and
annul a declaration of acceleration and its consequences if (i) all existing
Events of Default, other than the nonpayment of the principal of, premium, if
any, and interest on the Securities that have become due solely by such
declaration of acceleration, have been cured or waived and (ii) the rescission
would not conflict with any judgment or decree of a court of competent
jurisdiction. Upon any such waiver, such Default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or impair any right consequent thereon.
SECTION 4.05. Control by Majority. The Holders of at least a majority
in aggregate principal amount of the outstanding Securities may 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. However, the
Trustee may refuse to follow any direction that conflicts with law or the
Indenture, that may involve the Trustee in personal liability, or that the
Trustee determines in good faith may be unduly prejudicial to the rights of
Holders of Securities not joining in the giving of such direction and may take
any other action it deems proper that is not inconsistent with any such
direction received from Holders of Securities.
SECTION 4.06. Limitation on Suits. A Holder may not pursue any
remedy with respect to the Indenture or the Securities unless:
(i) the Holder gives the Trustee written notice of a continuing Event
of Default;
57
(ii) the Holders of at least 25% in aggregate principal amount of
outstanding Securities make a written request to the Trustee to pursue the
remedy;
(iii) such Holder or Holders offer the Trustee indemnity satisfactory
to the Trustee against any costs, liability or expense;
(iv) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of indemnity; and
(v) during such 60-day period, the Holders of at least a majority in
aggregate principal amount of the outstanding Securities do not give the Trustee
a direction that is inconsistent with the request.
SECTION 4.07. Rights of Holders to Receive Payment. Notwithstanding
any other provision of this Indenture, the right of any Holder to receive
payment of principal, premium, if any, and interest on the Security, on or after
the respective due dates expressed in the Security, or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of the Holder.
SECTION 4.08. Collection Suit by Trustee. If an Event of Default
specified in Section 4.01(a) or (b) hereof occurs and is continuing, the Trustee
is authorized to recover judgment in its own name and as trustee of an express
trust against the Company or any other obligor for the whole amount of
principal, premium, if any, and interest remaining unpaid on the Securities and
interest on overdue principal and, to the extent lawful, interest and such
further amount as shall be sufficient to cover amounts due the Trustee under
Section 5.07 hereof, including the costs and expenses of collection, including
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel.
SECTION 4.09. Trustee May File Proofs of Claim. The Trustee is
authorized to file such proofs of claim and other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee (including any
claim for the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel) and the Holders allowed in any judicial
proceedings relative to the Company (or any other obligor upon the Securities),
its creditors or its property and shall be entitled and empowered to collect,
receive and distribute any money or other property payable or deliverable on any
such claims and any custodian in any such judicial proceeding is hereby
authorized by each Holder to make such payments to the Trustee, and in the event
that the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 5.07
58
hereof. To the extent that the payment of any such compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 5.07 hereof out of the estate in any such
proceeding, shall be denied for any reason, payment of the same shall be secured
by a Lien on, and shall be paid out of, any and all distributions, dividends,
money, securities and other properties which the Holders may be entitled to
receive in such proceeding whether in liquidation or under any plan of
reorganization or arrangement or otherwise. Nothing herein contained 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 Securities 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.
SECTION 4.10. Priorities. If the Trustee collects any money pursuant
to this Article, it shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 5.07, including payment of all compensation, expense and liabilities
incurred, and all advances made, by the Trustee and the costs and expenses of
collection;
Second: to Holders for amounts due and unpaid on the Securities for
principal, premium, if any, and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the Securities
for principal, premium, if any and interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section 4.10 upon five Business Days prior notice to
the Company.
SECTION 4.11. Undertaking for Costs. In any suit for the enforcement
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as a Trustee, a court in its discretion
may require the filing by any party litigant in the suit of an undertaking to
pay the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees and expenses, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by a Holder pursuant to Section 4.06 hereof, or a
suit by Holders of more than 10% in aggregate principal amount of the then
outstanding Securities.
59
ARTICLE 5
CONCERNING THE TRUSTEE
SECTION 5.01. Duties and Responsibilities of the Trustee; During
Default; Prior to Default. The Trustee, prior to the occurrence of a Default and
after the curing or waiving of any Default which may have occurred, undertakes
to perform such duties and only such duties as are specifically set forth in
this Indenture. In case an Event of Default has occurred (which has not been
cured or waived) the Trustee shall exercise such of the rights and powers vested
in it by this Indenture, and use the same degree of care and skill in their
exercise, as a prudent person would exercise under the circumstances in the
conduct of such person's own affairs.
No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own wilful misconduct, except that
(a) prior to the occurrence of an Event of Default of which the
Trustee has actual notice and after the curing or waiving of all such Events of
Default which may have occurred:
(i) the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Indenture, and the Trustee
shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(ii) in the absence of bad faith on the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon any
statements, certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but in the case of
any such statements, certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this Indenture
(but need not confirm or investigate the accuracy of the facts stated
therein);
(b) the Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it shall be proved that the Trustee was negligent in ascertaining the
pertinent facts; and
(c) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction of
the holders
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of not less than a majority in principal amount of the Securities at the time
outstanding relating to the time, method and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any trust or power
conferred upon the Trustee, under this Indenture.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if there shall be reasonable ground for believing that the
repayment of such funds or adequate indemnity against such liability is not
reasonably assured to it.
This Section 5.01 is in furtherance of and subject to Sections 315
and 316 of the Trust Indenture Act of 1939.
SECTION 5.02. Certain Rights of the Trustee. In furtherance of and
subject to the Trust Indenture Act of 1939, and subject to Section 5.01:
(a) the Trustee may conclusively rely and shall be protected in
acting or refraining from acting upon any resolution, Officers' Certificate or
any other certificate, statement, instrument, opinion, report, notice, request,
consent, order, bond, debenture, note, coupon, security or other paper or
document believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(b) any request, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by an Officers' Certificate (unless other
evidence in respect thereof be herein specifically prescribed); and any
resolution of the Board of Directors may be evidenced to the Trustee by a copy
thereof certified by the secretary or an assistant secretary of the Company;
(c) the Trustee may consult with counsel of its selection and any
advice or Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be taken by it
hereunder in good faith and in accordance with such advice or Opinion of
Counsel;
(d) the Trustee shall be under no obligation to exercise any of the
trusts or powers vested in it by this Indenture at the request, order or
direction of any of the Securityholders pursuant to the provisions of this
Indenture, unless such Securityholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
which might be incurred therein or thereby;
(e) the Trustee shall not be liable for any action taken or omitted
by it in good faith and believed by it to be authorized or within the
discretion, rights or powers conferred upon it by this Indenture;
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(f) prior to the occurrence of a Default hereunder, of which the
Trustee has actual notice, and after the curing or waiving of all Defaults, the
Trustee shall not be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument, opinion, report,
notice, request, consent, order, approval, appraisal, bond, debenture, note,
coupon, security, or other paper or document unless requested in writing so to
do by the holders of not less than a majority in aggregate principal amount of
the Securities then outstanding; provided that, if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities likely to
be incurred by it in the making of such investigation is, in the opinion of the
Trustee, not reasonably assured to the Trustee by the security afforded to it by
the terms of this Indenture, the Trustee may require reasonable indemnity
against such expenses or liabilities as a condition to proceeding; the
reasonable expenses of every such examination shall be paid by the Company or,
if paid by the Trustee or any predecessor trustee, shall be repaid promptly by
the Company upon demand;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys not regularly in its employ and the Trustee shall not be responsible
for any misconduct or negligence on the part of any such agent or attorney
appointed with due care by it hereunder; and
(h) The Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
default is received by the Trustee at the Corporate Trust Office of the Trustee,
and such notice references the Securities and this Indenture.
SECTION 5.03. Trustee Not Responsible for Recitals, Disposition of
Securities or Application of Proceeds Thereof. The recitals contained herein and
in the Securities, except the Trustee's certificates of authentication, shall be
taken as the statements of the Company, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee makes no
representation as to the validity or sufficiency of this Indenture or of the
Securities. The Trustee shall not be accountable for the use or application by
the Company of any of the Securities or of the proceeds thereof.
SECTION 5.04. Trustee and Agents May Hold Securities; Collections,
etc. The Trustee or any agent of the Company or the Trustee, in its individual
or any other capacity, may become the owner or pledgee of Securities with the
same rights it would have if it were not the Trustee or such agent and may
otherwise deal with the Company and receive, collect, hold and retain
collections from the Company with
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the same rights it would have if it were not the Trustee or such agent. However,
subject to Section 5.13 hereof, the Trustee will comply with Sections 310(b) and
311 of the Trust Indenture Act of 1939.
SECTION 5.05. Moneys Held by Trustee. Subject to the provisions of
Section 11.06 hereof, all moneys received by the Trustee shall, until used or
applied as herein provided, be held in trust for the purposes for which they
were received, but need not be segregated from other funds except to the extent
required by mandatory provisions of law. Neither the Trustee nor any agent of
the Company or the Trustee shall be under any liability for interest on any
moneys received by it hereunder.
SECTION 5.06. Notice of Default. If any Default or any Event of
Default occurs and is continuing and if such Default or Event of Default is
actually known to a Responsible Officer of the Trustee, the Trustee shall mail
to each Holder in the manner and to the extent provided in Trust Indenture Act
of 1939 Section 313(c) notice of the Default or Event of Default within 90 days
after it occurs, unless such Default or Event of Default has been cured;
provided, however, that, except in the case of a default in the payment of the
principal of, premium, if any, or interest on any Security, the Trustee shall be
protected in withholding such notice if and so long as the board of directors,
the executive committee or a trust committee of directors and/or Responsible
Officers of the Trustee in good faith determine that the withholding of such
notice is in the interest of the Holders.
SECTION 5.07. Compensation and Indemnification of Trustee and Its
Prior Claim. The Company covenants and agrees to pay to the Trustee from time to
time, and the Trustee shall be entitled to, such compensation as shall be agreed
in writing between the Company and the Trustee (which shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust) and the Company covenants and agrees to pay or reimburse the Trustee and
each predecessor Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by or on behalf of it in accordance
with any of the provisions of this Indenture (including the reasonable
compensation and the expenses and disbursements of its counsel and of all agents
and other persons not regularly in its employ) except any such expense,
disbursement or advance as may arise from its negligence or bad faith. The
Company also covenants to indemnify the Trustee and each predecessor Trustee
for, and to hold it harmless against, any and all loss, liability, damage, claim
or expense, including taxes (other than taxes based on the income of the
Trustee) incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of this Indenture or the
trusts hereunder and its duties hereunder, including the costs and expenses of
defending itself against or investigating any claim of liability in the
premises. The obligations of the Company under this Section to compensate and
indemnify the Trustee and each predecessor Trustee and to pay or reimburse the
Trustee and each
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predecessor Trustee for expenses, disbursements and advances shall constitute
additional indebtedness hereunder and shall survive the satisfaction and
discharge of this Indenture. Such additional indebtedness shall be a senior
claim to that of the Securities upon all property and funds held or collected by
the Trustee as such, except funds held in trust for the benefit of the holders
of particular Securities, and the Securities are hereby subordinated to such
senior claim.
When the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 4.01(g) or Section 4.01(h), the
expenses (including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.
SECTION 5.08. Right of Trustee to Rely on Officers' Certificate, etc.
Subject to Sections 5.01 and 5.02, whenever in the administration of the trusts
of this Indenture the Trustee shall deem it necessary or desirable that a matter
be proved or established prior to taking or suffering or omitting any action
hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of negligence or bad faith on the
part of the Trustee, be deemed to be conclusively proved and established by an
Officers' Certificate delivered to the Trustee, and such certificate, in the
absence of negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken, suffered or omitted by it under the
provisions of this Indenture upon the faith thereof.
SECTION 5.09. Persons Eligible for Appointment as Trustee. The
Trustee hereunder shall at all times be a corporation having a combined capital
and surplus of at least $100,000,000, and which is eligible in accordance with
the provisions of Section 310(a) of the Trust Indenture Act of 1939. If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of a Federal, State or District of Columbia supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
SECTION 5.10. Resignation and Removal; Appointment of Successor
Trustee. (a) The Trustee may at any time resign by giving written notice of
resignation to the Company. Upon receiving such notice of resignation, the
Company shall promptly appoint a successor trustee by written instrument in
duplicate, executed by authority of the Board of Directors, one copy of which
instrument shall be delivered to the resigning Trustee and one copy to the
successor trustee. If no successor trustee shall have been so appointed and have
accepted appointment within 30 days after the mailing of such notice of
resignation, the resigning trustee may petition, at the expense of the Company,
any court of competent jurisdiction for the appointment of
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a successor trustee, or any Securityholder who has been a bona fide holder of a
Security or Securities for at least six months may, on behalf of himself and all
others similarly situated, petition any such court for the appointment of a
successor trustee. Such court may thereupon, after such notice, if any, as it
may deem proper and prescribe, appoint a successor trustee.
(b) In case at any time any of the following shall occur:
(i) the Trustee shall fail to comply with the provisions of
Section 310(b) of the Trust Indenture Act of 1939, after written
request therefor by the Company or by any Securityholder who has been
a bona fide holder of a Security or Securities for at least six
months; or
(ii) the Trustee shall cease to be eligible in accordance with
the provisions of Section 5.09 and shall fail to resign after written
request therefor by the Company or by any such Securityholder; or
(iii) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver or liquidator of the
Trustee or of its property shall be appointed, or any public officer
shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or
liquidation;
then, in any such case, the Company may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, executed by order of the
Board of Directors of the Company, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to the successor trustee, or,
subject to Section 315(e) of the Trust Indenture Act of 1939, any Securityholder
who has been a bona fide holder of a Security or Securities for at least six
months may on behalf of himself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor trustee. Such court may thereupon, after such notice,
if any, as it may deem proper and prescribe, remove the Trustee and appoint a
successor trustee.
(c) The holders of a majority in aggregate principal amount of the
Securities at the time outstanding may at any time remove the Trustee and
appoint a successor trustee by delivering to the Trustee so removed, to the
successor trustee so appointed and to the Company the evidence provided for in
Section 6.01 of the action in that regard taken by the Securityholders.
If no successor trustee shall have been so appointed and have
accepted appointment 30 days after the mailing of such notice of removal, the
trustee being removed may petition, at the expense of the Company, any court of
competent
65
jurisdiction for the appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and prescribe,
appoint a successor trustee.
(d) Any resignation or removal of the Trustee and any appointment of
a successor trustee pursuant to any of the provisions of this Section 5.10 shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 5.11.
SECTION 5.11. Acceptance of Appointment by Successor Trustee. Any
successor trustee appointed as provided in Section 5.10 shall execute and
deliver to the Company and to its predecessor trustee an instrument accepting
such appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee, without
any further act, deed or conveyance, shall become vested with all rights,
powers, duties and obligations of its predecessor hereunder, with like effect as
if originally named as trustee herein; but, nevertheless, on the written request
of the Company or of the successor trustee, upon payment of its charges then
unpaid, the trustee ceasing to act shall, subject to Section 11.06, pay over to
the successor trustee all moneys at the time held by it hereunder and shall
execute and deliver an instrument transferring to such successor trustee all
such rights, powers, duties and obligations. Upon request of any such successor
trustee, the Company shall execute any and all instruments in writing for more
fully and certainly vesting in and confirming to such successor trustee all such
rights and powers. Any trustee ceasing to act shall, nevertheless, retain a
prior claim upon all property or funds held or collected by such trustee to
secure any amounts then due it pursuant to the provisions of Section 5.07.
Upon acceptance of appointment by a successor trustee as provided in
this Section 5.11, the Company shall mail notice thereof by first-class mail to
the holders of Securities at their last addresses as they shall appear in the
Security Register. If the acceptance of appointment is substantially
contemporaneous with the resignation, then the notice called for by the
preceding sentence may be combined with the notice called for by Section 5.10.
If the Company fails to mail such notice within 10 days after acceptance of
appointment by the successor trustee, the successor trustee shall cause such
notice to be mailed at the expense of the Company.
SECTION 5.12. Merger, Conversion, Consolidation or Succession to
Business of Trustee. Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or to which the Trustee's assets
may be sold, or any corporation resulting from any merger, conversion,
consolidation or sale to which the Trustee shall be a party or by which the
Trustee's property may be bound, or any corporation succeeding to all or
substantially all the corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder, provided that such
66
corporation shall be eligible under the provisions of Section 5.09, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding.
In case at the time such successor to the Trustee shall succeed to
the trusts created by this Indenture any of the Securities shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor Trustee and deliver such
Securities so authenticated; and, in case at that time any of the Securities
shall not have been authenticated, any successor to the Trustee may authenticate
such Securities either in the name of any predecessor hereunder or in the name
of the successor Trustee; and in all such cases such certificate shall have the
full force which it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee shall have; provided, that the right to
adopt the certificate of authentication of any predecessor Trustee or to
authenticate Securities in the name of any predecessor Trustee shall apply only
to its successor or successors by merger, conversion or consolidation.
SECTION 5.13. Preferential Collection of Claims. Reference is made to
Section 311 of the Trust Indenture Act of 1939. For purposes of Section 311(b)
(4) and (6) of such Act, the following terms shall mean:
(a) "cash transaction" means any transaction in which full payment
for goods or securities sold is made within seven days after delivery of the
goods or securities in currency or in checks or other orders drawn upon banks or
bankers and payable upon demand; and
(b) "self-liquidating paper" means any draft, xxxx of exchange,
acceptance or obligation which is made, drawn, negotiated or incurred by the
Company for the purpose of financing the purchase, processing, manufacturing,
shipment, storage or sale of goods, wares or merchandise and which is secured by
documents evidencing title to, possession of, or a lien upon, the goods, wares
or merchandise or the receivables or proceeds arising from the sale of the
goods, wares or merchandise previously constituting the security, provided the
security is received by the Trustee simultaneously with the creation of the
creditor relationship with the Company arising from the making, drawing,
negotiating or incurring of the draft, xxxx of exchange, acceptance or
obligation.
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ARTICLE 6
CONCERNING THE HOLDERS
SECTION 6.01. Evidence of Action Taken by Holders. Any request,
demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given or taken by Securityholders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Securityholders in person or by agent duly appointed in
writing; and, except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Trustee. Proof of execution of any instrument or of a writing appointing any
such agent shall be sufficient for any purpose of this Indenture and (subject to
Sections 5.01 and 5.02) conclusive in favor of the Trustee and the Company, if
made in the manner provided in this Article.
SECTION 6.02. Proof of Execution of Instruments and of Holding of
Securities; Record Date. Subject to Sections 5.01 and 5.02, the execution of any
instrument by a Securityholder or his agent or proxy may be proved in accordance
with such reasonable rules and regulations as may be prescribed by the Trustee
or in such manner as shall be satisfactory to the Trustee. The holding of
Securities shall be proved by the Security register or by a certificate of the
Registrar thereof. The Company may set a record date for purposes of determining
the identity of holders of Securities entitled to vote or consent to any action
referred to in Section 6.01, which record date may be set at any time or from
time to time by notice to the Trustee, for any date or dates (in the case of any
adjournment or resolicitation) not more than 60 days nor less than five days
prior to the proposed date of such vote or consent, and thereafter,
notwithstanding any other provisions hereof, only holders of Securities of
record on such record date shall be entitled to so vote or give such consent or
to withdraw such vote or consent.
SECTION 6.03. Securities Owned by Company Deemed Not Outstanding. In
determining whether the holders of the requisite aggregate principal amount of
Securities have concurred in any direction, consent or waiver under this
Indenture, Securities which are owned by the Company or any other obligor on the
Securities or by any person directly or indirectly controlling or controlled by
or under direct or indirect common control with the Company or any other obligor
on the Securities shall be disregarded and deemed not to be outstanding for the
purpose of any such determination, except that for the purpose of determining
whether the Trustee shall be protected in relying on any such direction, consent
or waiver only Securities which a Responsible Officer of the Trustee actually
knows are so owned shall be so disregarded. Securities so owned which have been
pledged in good faith may be regarded as outstanding if the pledgee establishes
to the satisfaction of the Trustee the pledgee's right so to act with respect to
such Securities and that the pledgee is not
68
the Company or any other obligor upon the Securities or any person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company or any other obligor on the Securities. In case of a
dispute as to such right, the advice of counsel shall be full protection in
respect of any decision made by the Trustee in accordance with such advice. Upon
request of the Trustee, the Company shall furnish to the Trustee promptly an
Officers' Certificate listing and identifying all Securities, if any, known by
the Company to be owned or held by or for the account of any of the
above-described persons; and, subject to Sections 5.01 and 5.02, the Trustee
shall be entitled to accept such Officers' Certificate as conclusive evidence of
the facts therein set forth and of the fact that all Securities not listed
therein are outstanding for the purpose of any such determination.
SECTION 6.04. Right of Revocation of Action Taken. At any time prior
to (but not after) the evidencing to the Trustee, as provided in Section 6.01,
of the taking of any action by the holders of the percentage in aggregate
principal amount of the Securities specified in this Indenture in connection
with such action, any holder of a Security the serial number of which is shown
by the evidence to be included among the serial numbers of the Securities the
Holders of which have consented to such action may, by filing written notice at
the Corporate Trust Office and upon proof of holding as provided in this
Article, revoke such action so far as concerns such Security. Except as
aforesaid any such action taken by the holder of any Security shall be
conclusive and binding upon such holder and upon all future holders and owners
of such Security and of any Securities issued in exchange or substitution
therefor, irrespective of whether or not any notation in regard thereto is made
upon any such Security. Any action taken by the holders of the percentage in
aggregate principal amount of the Securities specified in this Indenture in
connection with such action shall be conclusively binding upon the Company, the
Trustee and the holders of all the Securities.
ARTICLE 7
SUPPLEMENTAL INDENTURES
SECTION 7.01. Supplemental Indentures Without Consent of Holders.
The Company, the Guarantors (if any) and the Trustee may amend or supplement
this Indenture or the Securities without the consent of any Holder:
(i) to cure any ambiguity, defect or inconsistency;
(ii) to provide for uncertificated Securities in addition to or in
place of certificated Securities;
69
(iii) to provide for any supplemental indenture required pursuant
to Section 3.15 hereof;
(iv) to provide for the assumption of the Company's obligations
to the Holders of the Securities in the case of a merger,
consolidation or sale of assets pursuant to Article Eight hereof;
(v) to make any change that would provide any additional rights
or benefits to the Holders of the Securities or that does not
adversely affect the legal rights hereunder of any such Holder; or
(vi) to comply with requirements of the Commission in order to
effect or maintain the qualification of this Indenture under the
Trust Indenture Act of 1939.
Upon the request of the Company accompanied by a Board Resolution
authorizing the execution of any such supplemental indenture, and upon receipt
by the Trustee of the documents described in Section 7.04 hereof, the Trustee
shall join with the Company and the Guarantors (if any), in the execution of any
supplemental indenture authorized or permitted by the terms of this Indenture
and to make any further appropriate agreements and stipulations which may be
therein contained, but the Trustee shall not be obligated to enter into such
supplemental indenture which affects its own rights, duties or immunities under
this Indenture or otherwise.
SECTION 7.02. With Consent of Holders. Except as provided in the next
succeeding paragraphs, this Indenture or the Securities may be amended or
supplemented with the consent of the Holders of at least a majority in aggregate
principal amount of the Securities then outstanding (including consents obtained
in connection with a tender offer or exchange offer for such Securities), and
any existing default or compliance with any provision of this Indenture or the
Securities may be waived with the consent of the Holders of a majority in
aggregate principal amount of the then outstanding Securities (including
consents obtained in connection with a tender offer or exchange offer for such
Securities).
Upon the request of the Company accompanied by a Board Resolution
authorizing the execution of any such supplemental indenture, and upon the
filing with the Trustee of evidence satisfactory to the Trustee of the consent
of the Holders as aforesaid, and upon receipt by the Trustee of the documents
described in Section 7.04 hereof, the Trustee shall join with the Company and
the Guarantors (if any), in the execution of such supplemental indenture unless
such supplemental indenture affects the Trustee's own rights, duties or
immunities under this Indenture
70
or otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such supplemental indenture.
It shall not be necessary for the consent of the Holders under this
Section 7.02 to approve the particular form of any proposed amendment or waiver,
but it shall be sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture or waiver.
Subject to Sections 4.04 and 4.07 hereof, the Holders of a majority in aggregate
principal amount of the Securities then outstanding may waive compliance in a
particular instance by the Company with any provision of this Indenture or the
Securities. Without the consent of each Holder affected, however, an amendment
or waiver may not (with respect to any Security held by a non-consenting
Holder):
(i) change the Stated Maturity of the principal of, or any
installment of interest on, any Security;
(ii) reduce the principal amount of, or premium, if any, or interest
on, any Security;
(iii) reduce any amount payable on redemption of the Securities or
upon the occurrence on an Event of Default or reduce the Change of Control
Payment or the Excess Proceeds Offer Payment;
(iv) change the place or currency of payment of principal of,
premium, if any, or interest on, any Security;
(v) impair the right to institute suit for the enforcement of any
payment on or after the Stated Maturity (or, in the case of a redemption, on or
after the redemption date) of any Security;
(vi) reduce the above-stated percentage of outstanding Securities the
consent of whose Holders is necessary to modify or amend the Indenture;
(vii) waive a default in the payment of principal of, premium, if
any, or interest on the Securities;
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(viii) reduce the percentage or aggregate principal amount of
outstanding Securities the consent of whose Holders is necessary for waiver of
compliance with certain provisions of the Indenture or for waiver of certain
defaults;
(ix) modify or change any provision of the Indenture affecting the
ranking of the Securities or the Subsidiary Guarantee in a manner adverse to the
holders of the Securities; or
(x) release any Guarantor from any of its obligations under its
Subsidiary Guarantee or the Indenture other than in accordance with the
provisions of the Indenture, or amend or modify any provision relating to such
release.
Neither the Company nor any of its Subsidiaries will, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise to any Holder of any notes for or as an inducement to
any consent, waiver or amendment of any of the terms or provisions of the
Indenture or the Securities unless such consideration is offered to be paid or
agreed to be paid to all Holders of the Securities that consent, waive or agree
to amend in the time frame set forth in the solicitation documents relating to
such consent, waiver or agreement.
SECTION 7.03. Effect of Supplemental Indenture. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and be deemed to be modified and amended in accordance therewith and
the respective rights, limitations of rights, obligations, duties and immunities
under this Indenture of the Trustee, the Company and the holders of Securities
shall thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
SECTION 7.04. Documents to Be Given to Trustee; Compliance with TIA.
The Trustee, subject to the provisions of Sections 5.01 and 5.02, may receive an
Officers' Certificate and an Opinion of Counsel as conclusive evidence that any
such supplemental indenture complies with the applicable provisions of this
Indenture. Every such supplemental indenture shall comply with the TIA.
SECTION 7.05. Notation on Securities in Respect of Supplemental
Indentures. Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to the provisions of this Article may bear a
notation approved by the Trustee as to form (but not as to substance) as to any
matter provided for by such supplemental indenture or as to any action taken at
any such meeting. If the Company or the Trustee shall so determine, new
Securities so modified as to conform, in the opinion of the Trustee and the
Board of Directors, to any
72
modification of this Indenture contained in any such supplemental indenture may
be prepared by the Company, authenticated by the Trustee and delivered in
exchange for the Securities then outstanding.
ARTICLE 8
CONSOLIDATION, MERGER OR SALE OF ASSETS
SECTION 8.01. Consolidation, Merger or Sale of Assets. The Company
shall not consolidate with, merge with or into, or sell, convey, transfer, lease
or otherwise dispose of all or substantially all of its property and assets (as
an entirety or substantially an entirety in one transaction or a series of
related transactions) to, any Person nor permit any Person to merge with or into
the Company unless:
(i) the Company shall be the continuing Person, or the Person (if
other than the Company) formed by such consolidation or into which
the Company is merged or that acquired or leased such property and
assets of the Company shall be a corporation organized and validly
existing under the laws of the United States of America or any
jurisdiction thereof and shall expressly assume, by a supplemental
indenture, executed and delivered to the Trustee, all of the
obligations of the Company on all of the Securities and under the
Indenture;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) immediately after giving effect to such transaction on a pro
forma basis, but not including the effect of any purchase accounting
adjustments, the Company, or any Person becoming the successor
obligor of the Securities shall have a Consolidated Net Worth at
least equal to the Consolidated Net Worth of the Company immediately
prior to such transactions, provided that this clause (iii) shall not
apply to a consolidation or merger with or into a Wholly Owned
Restricted Subsidiary with a positive net worth; provided that, in
connection with any such merger or consolidation, no consideration
(other than Common Stock in the surviving Person or the Company)
shall be issued or distributed to the stockholders of the Company;
(iv) immediately after giving effect to such transaction on a pro
forma basis, the Company, or any Person becoming the successor
obligor of the Securities could Incur at least $1.00 of Indebtedness
under the first
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paragraph of Section 3.09; provided that this clause (iv) shall not
apply to a consolidation or merger with or into a Wholly Owned
Restricted Subsidiary with a positive net worth; provided that, in
connection with any such merger or consolidation, no consideration
(other than Common Stock in the surviving Person or the Company)
shall be issued or distributed to the stockholders of the Company;
and
(v) the Company delivers to the Trustee an Officers' Certificate
(attaching the arithmetic computations to demonstrate compliance with
clauses (iii) and (iv) above) and opinion of counsel, in each case
stating that such consolidation, merger or transfer and such
supplemental indenture complies with this provision and that all
conditions precedent provided for herein relating to such transaction
have been complied with; provided that clauses (iii) and (iv) above
do not apply if, in the good faith determination of the Board of
Directors of the Company, whose determination shall be evidenced by a
Board Resolution, the principal purpose of such transaction is to
change the state of incorporation of the Company; and provided
further that any such transaction shall not have as one of its
purposes the evasion of the foregoing limitations.
SECTION 8.02. Successor Corporation Substituted. Upon any
consolidation or merger, or any sale, assignment, transfer, lease, conveyance or
other disposition of all or substantially all of the assets of the Company in
accordance with Section 8.01 hereof, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which such sale,
assignment, transfer, lease, conveyance or other disposition is made shall
succeed to, and be substituted for (so that from and after the date of such
consolidation, merger, sale, assignment, transfer, lease, conveyance or other
disposition, the provisions of this Indenture referring to the "Company" shall
refer instead to the successor corporation), and may exercise every right and
power of, the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein.
SECTION 8.03. Opinion of Counsel to Trustee. The Trustee, subject to
the provisions of Sections 5.01 and 5.02, may receive an Opinion of Counsel as
conclusive evidence that any such consolidation, merger, conveyance, sale,
transfer, lease, exchange or other disposition complies with the applicable
provisions of this Indenture.
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ARTICLE 9
SUBORDINATION
SECTION 9.01. Agreement to Subordinate. The Company agrees, and each
Holder by accepting a Security agrees, any provision of this Indenture or the
Securities to the contrary notwithstanding, that all Obligations owed under and
in respect of the Securities are subordinated in right of payment, to the extent
and in the manner provided in this Article Nine, to the prior payment in full in
cash or cash equivalents of all Senior Indebtedness of the Company, and that the
subordination of the Securities pursuant to this Article Nine is for the benefit
of all holders of all Senior Indebtedness of the Company, whether outstanding on
the Issue Date or incurred thereafter.
SECTION 9.02. Liquidation; Dissolution; Bankruptcy. (a) Upon any
payment or distribution of assets or securities of the Company of any kind or
character, whether in cash, property or securities, upon any dissolution or
winding up or total or partial liquidation or reorganization of the Company,
whether voluntary or involuntary, or in bankruptcy, insolvency, receivership or
other proceedings, all amounts due or to become due upon all Senior Indebtedness
(including any interest accruing on or after, or which would accrue but for, an
event of bankruptcy, whether or not such interest is an allowed claim
enforceable against the debtor under the United States Bankruptcy Code) shall
first be paid in full, in cash or cash equivalents, before the Holders of the
Securities or the Trustee on behalf of the Holders of the Securities shall be
entitled to receive any payment by the Company on account of Senior Subordinated
Obligations or any payment to acquire any of the Securities for cash, property
or securities, or any distribution with respect to the Securities of any cash,
property or securities. Before any payment may be made by, or on behalf of, the
Company on any Senior Subordinated Obligations, upon any such dissolution,
winding up, liquidation or reorganization, any payment or distribution of assets
or securities of the Company of any kind or character, whether in cash, property
or securities, to which the Holders of the Securities or the Trustee on behalf
of the Holders of the Securities would be entitled, but for the subordination
provisions of the Indenture, shall be made by the Company or by any receiver,
trustee in bankruptcy, liquidating trustee, agent or other similar Person making
such payment or distribution or by the Holders of the Securities or the Trustee
if received by them or it, directly to the holders of the Senior Indebtedness
(pro rata to such holders on the basis of the respective amounts of Senior
Indebtedness held by such holders) or their representatives or to any trustee or
trustees under any indenture pursuant to which any such Senior Indebtedness may
have been issued, as their respective interests appear, to the extent necessary
to pay all such Senior Indebtedness in full, in cash or cash equivalents after
giving effect to any concurrent payment, distribution or provision therefor to
or for the holders of such Senior Indebtedness. However,
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notwithstanding the foregoing, Holders of Securities may receive securities so
long as (i) the Securities are not treated in any case or proceeding or other
event described above as part of the same class of claims as the Senior
Indebtedness or any class of claims on a parity with or senior to the Senior
Indebtedness for any payment or distribution, (ii) such securities are
subordinated at least to the same extent as the Securities to Senior
Indebtedness of the Company and any securities issued in exchange for such
Senior Indebtedness and (iii) such securities are authorized by an order or
decree of a court of competent jurisdiction in a reorganization proceeding under
any applicable bankruptcy, insolvency or similar law which gives effect to the
subordination of the Securities to Senior Indebtedness in a manner and with an
effect which would be required if this sentence were not included in this
paragraph.
(b) Notwithstanding anything to the contrary in this Section 9.02,
Holders of Securities may continue to receive payments from the trust
established pursuant to Section 11.04.
SECTION 9.03. Default on Designated Senior Indebtedness. No direct or
indirect payment by or on behalf of the Company of Senior Subordinated
Obligations, whether pursuant to the terms of the Securities or upon
acceleration or otherwise, shall be made if, at the time of such payment, there
exists a default in the payment of all or any portion of the obligations under
or with respect to any Senior Indebtedness of the Company and such default shall
not have been cured or waived or the benefits of this sentence waived by or on
behalf of the holders of such Senior Indebtedness. In addition, during the
continuance of any other event of default with respect to any Designated Senior
Indebtedness pursuant to which the maturity thereof may be accelerated, upon
receipt by the Trustee of written notice from the trustee or other
representative for the holders of such Designated Senior Indebtedness (or the
holders of at least a majority in principal amount of such Designated Senior
Indebtedness then outstanding), no payment of Senior Subordinated Obligations
may be made by or on behalf of the Company upon or in respect of the Securities
for a period (a "Payment Blockage Period") commencing on the date of receipt of
such notice and ending 179 days thereafter (unless, in each case, such Payment
Blockage Period shall be terminated (i) by written notice to the Trustee from
such trustee of, or other representatives for, such holders or (ii) by such
event of default having been cured or waived or otherwise ceasing to exist or
(iii) by payment in full in cash or cash equivalents of such Designated Senior
Indebtedness). Not more than one Payment Blockage Period may be commenced with
respect to the Securities during any period of 360 consecutive days.
Notwithstanding anything in the Indenture to the contrary, there must be 180
consecutive days in any 360-day period in which no Payment Blockage Period is in
effect. No event of default that existed or was continuing (it being
acknowledged that any subsequent action that would give rise to an event of
default pursuant to any provision under which an event of default previously
existed or was continuing shall constitute a new event of default for this
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purpose) on the date of the commencement of any Payment Blockage Period with
respect to the Designated Senior Indebtedness initiating such Payment Blockage
Period shall be, or shall be made, the basis for the commencement of a second
Payment Blockage Period by the representative for, or the holders of, such
Designated Senior Indebtedness, whether or not within a period of 360
consecutive days, unless such event of default shall have been cured or waived
for a period of not less than 90 consecutive days.
To the extent any payment of Senior Indebtedness (whether by or on
behalf of the Company, as proceeds of security or enforcement of any right of
setoff or otherwise) is declared to be fraudulent or preferential, set aside or
required to be paid to any receiver, trustee in bankruptcy, liquidating trustee,
agent or other similar Person under any bankruptcy, insolvency, receivership,
fraudulent conveyance or similar law, then if such payment is recovered by, or
paid over to, such receiver, trustee in bankruptcy, liquidating trustee, agent
or other similar Person, the Senior Indebtedness or part thereof originally
intended to be satisfied shall be deemed to be reinstated and outstanding as if
such payment had not occurred. To the extent the obligation to repay any Senior
Indebtedness is declared to be fraudulent, invalid, or otherwise set aside under
any bankruptcy, insolvency, receivership, fraudulent conveyance or similar law,
then the obligation so declared fraudulent, invalid or otherwise set aside (and
all other amounts that would come due with respect thereto had such obligation
not been so affected) shall be deemed to be reinstated and outstanding as Senior
Indebtedness for all purposes hereof as if such declaration, invalidity or
setting aside had not occurred.
SECTION 9.04. When Distributions Must Be Paid Over. If the Company
shall make any payment to the Trustee on account of the principal of, or
premium, if any, or interest on, the Securities, or the Holders shall receive
from any source any payment on account of the principal of, premium, if any, or
interest on, the Securities or any Obligation in respect of the Securities, at a
time when such payment is prohibited by this Article Nine, the Trustee or such
Holders shall hold such payment in trust for the benefit of, and shall pay over
and deliver to, the holders of the Company's Senior Indebtedness (pro rata as to
each of such holders on the basis of the respective amounts of such Senior
Indebtedness held by them) or their representative, as their respective
interests may appear, for application to the payment of all outstanding Senior
Indebtedness of the Company until all such Senior Indebtedness has been paid in
full in cash or cash equivalents, after giving effect to all other payments or
distributions to, or provisions made for, the holders of the Company's Senior
Indebtedness.
With respect to the holders of Senior Indebtedness of the Company,
the Trustee undertakes to perform only such obligations on its part as are
specifically set forth in this Article Nine, and no implied covenants or
obligations with respect to any
77
holders of the Company's Senior Indebtedness shall be read into this Indenture
against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty
to the holders of the Company's Senior Indebtedness, and shall not be liable to
any holders of such Senior Indebtedness if the Trustee shall pay over or
distribute to, or on behalf of, Holders or the Company or any other Person,
money or assets to which any holders of such Senior Indebtedness are entitled
pursuant to this Article Nine, except if such payment is made at a time when a
Responsible Officer has actual knowledge that the terms of this Article Nine
prohibit such payment.
SECTION 9.05. Notice. Neither the Trustee nor the paying agent shall
at any time be charged with the knowledge of the existence of any facts that
would prohibit the making of any payment to or by the Trustee or paying agent
under this Article Nine unless and until the Trustee or paying agent shall have
received written notice thereof from the Company or one or more holders of the
Company's Senior Indebtedness or a representative of any holders of such Senior
Indebtedness; and, prior to the receipt of any such written notice, the Trustee
or paying agent shall be entitled to assume conclusively that no such facts
exist; provided that if a Responsible Officer of the Trustee shall not have
received the notice provided for in this Section 9.05 at least one Business Days
prior to the date such payment is due pursuant to the terms hereof, then,
notwithstanding anything herein to the contrary, the Trustee shall have full
power and authority to make such payment and shall not be affected by any notice
to the contrary which may be received by it within one Business Day prior to
such date (it being understood that nothing contained in this Section 9.05 shall
limit the rights of the holders of the Company's Senior Indebtedness to recover
any payment pursuant to Section 9.04). The Trustee shall be entitled to rely on
the delivery to it of written notice by a Person representing itself to be a
holder of the Company's Senior Indebtedness (or a representative thereof) to
establish that such notice has been given. In the event that the Trustee
determines in good faith that further evidence is required with respect to the
right of any person as a holder of Senior Indebtedness to participate in any
payment or distribution pursuant to this Article, the Trustee may request such
person to furnish evidence to the reasonable satisfaction of the Trustee as to
the amount of Senior Indebtedness held by such person, the extent to which such
person is entitled to participate in such payment or distribution and any other
facts pertinent to the rights of such person under this Article, and if such
evidence is not furnished, the Trustee may defer any payment which it may be
required to make for the benefit of such person pursuant to the terms of this
Indenture pending judicial determination as to the rights of such person to
receive such payment.
The Company shall promptly notify the Trustee and the paying agent in
writing of any facts it knows that would cause a payment of principal of,
premium, if any, or interest on, the Securities or any other Obligation in
respect of the Securities to violate this Article Nine, but failure to give such
notice shall not affect
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the subordination of the Securities to the Senior Indebtedness of the Company
provided in this Article Nine or the rights of holders of such Senior
Indebtedness under this Article Nine.
SECTION 9.06. Subrogation. After all Senior Indebtedness of the
Company has been paid in full in cash or cash equivalents and until the
Securities are paid in full, Holders shall be subrogated (equally and ratably
with all other Indebtedness pari-passu with the Securities) to the rights of
holders of such Senior Indebtedness to receive distributions applicable to such
Senior Indebtedness to the extent that distributions otherwise payable to the
Holders have been applied to the payment of such Senior Indebtedness. A
distribution made under this Article Nine to holders of the Company's Senior
Indebtedness that otherwise would have been made to Holders is not, as between
the Company and Holders, a payment by the Company on its Senior Indebtedness.
SECTION 9.07. Relative Rights. This Article Nine defines the relative
rights of Holders and holders of the Company's Senior Indebtedness. Nothing in
this Indenture shall: (1) impair, as between the Company and Holders, the
Company's Obligations, which are absolute and unconditional, to pay principal
of, premium, if any, and interest on the Securities in accordance with their
terms; (2) affect the relative rights of Holders and the Company's creditors
other than their rights in relation to holders of the Company's Senior
Indebtedness; or (3) prevent the Trustee or any Holder from exercising its
available remedies upon a Default or Event of Default, subject to the rights of
holders of the Company's Senior Indebtedness to receive distributions and
payments otherwise payable to Holders.
The failure to make a payment on account of principal of or interest
on the Securities by reason of any provision of this Article Nine shall not be
construed as preventing the occurrence of an Event of Default under Section
4.01.
SECTION 9.08. The Company and Holders May Not Impair Subordination.
(a) No right of any holder of the Company's Senior Indebtedness to enforce the
subordination as provided in this Article Nine shall at any time or in any way
be prejudiced or impaired by any act or failure to act by the Company or by any
noncompliance by the Company with the terms, provisions and covenants of this
Indenture or the Securities or any other agreement regardless of any knowledge
thereof with which any such holder may have or be otherwise charged.
(b) Without in any way limiting Section 9.08(a), the holders of any
Senior Indebtedness of the Company may, at any time and from time to time to the
extent not otherwise prohibited by this Indenture, without the consent of or
notice to any Holders, without incurring any liabilities to any Holder and
without impairing or releasing the subordination and other benefits provided in
this Indenture or the
79
Holders' obligations to the holders of such Senior Indebtedness, even if any
Holder's right of reimbursement or subrogation or other right or remedy is
affected, impaired or extinguished thereby, do any one or more of the following:
(i) amend, renew, exchange, extend, modify, increase or supplement in any manner
such Senior Indebtedness or any instrument evidencing or guaranteeing or
securing such Senior Indebtedness or any agreement under which such Senior
Indebtedness is outstanding (including, but not limited to, changing the manner,
place or terms of payment or changing or extending the time of payment of, or
renewing, exchanging, amending, increasing or altering, (1) the terms of such
Senior Indebtedness, (2) any security for, or any Guarantee of, such Senior
Indebtedness, (3) any liability of any obligor on such Senior Indebtedness
(including any guarantor) or any liability incurred in respect of such Senior
Indebtedness) (ii) sell, exchange, release, surrender, realize upon, enforce or
otherwise deal with in any manner and in any order any property pledged,
mortgaged or otherwise securing such Senior Indebtedness or any liability of any
obligor thereon, to such holder, or any liability incurred in respect thereof;
(iii) settle or compromise any such Senior Indebtedness or any other liability
of any obligor of such Senior Indebtedness to such holder or any security
therefor or any liability incurred in respect thereof and apply any sums by
whomsoever paid and however realized to any liability (including, without
limitation, payment of any of the Company's Senior Indebtedness) in any manner
or order; and (iv) fail to take or to record or otherwise perfect, for any
reason or for no reason, any lien or security interest securing such Senior
Indebtedness by whomsoever granted, exercise or delay in or refrain from
exercising any right or remedy against any obligor or any guarantor or any other
Person, elect any remedy and otherwise deal freely with any obligor and any
security for such Senior Indebtedness or any liability of any obligor to the
holders of such Senior Indebtedness or any liability incurred in respect of such
Senior Indebtedness.
(c) Each Holder by accepting a Security agrees not to compromise,
release, forgive or otherwise discharge the Company's Obligations with respect
to such Holder's Security unless holders of a majority of the outstanding amount
of each class of Senior Indebtedness consent to such compromise, release,
forgiveness or discharge.
SECTION 9.09. Distribution or Notice to Representative. Whenever a
distribution is to be made, or a notice given, to holders of Senior Indebtedness
of the Company, the distribution may be made and the notice given to their
representative, if any. If any payment or distribution of the Company's assets
is required to be made to holders of any of the Company's Senior Indebtedness
pursuant to this Article Nine, the Trustee and the Holders shall be entitled to
rely upon any order or decree of any court of competent jurisdiction, or upon
any certificate of a representative of such Senior Indebtedness or a custodian,
in ascertaining the holders of such Senior Indebtedness entitled to participate
in any such payment or distribution, the amount
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to be paid or distributed to holders of such Senior Indebtedness and all other
facts pertinent to such payment or distribution or to this Article Nine.
SECTION 9.10. Rights of Trustee and Paying Agent. The Trustee or
paying agent may continue to make payments on the Securities unless prior to any
payment date it has received written notice of facts that would cause a payment
of principal of, or premium, if any, or interest on, the Securities to violate
this Article Nine. Only the Company, a representative of Senior Indebtedness, or
a holder of Senior Indebtedness that has no representative may give such notice.
To the extent permitted by the Trust Indenture Act of 1939, the
Trustee in its individual or any other capacity may hold Indebtedness of the
Company (including Senior Indebtedness) with the same rights it would have if it
were not Trustee. Any agent of the Trustee may do the same with like rights.
Nothing in this Article Nine shall apply to claims of, or payments
to, the Trustee under or pursuant to Section 5.07.
SECTION 9.11. Authorization to Effect Subordination. Each Holder of a
Security by its acceptance thereof authorizes and directs the Trustee on its
behalf to take such action as may be necessary or appropriate to effectuate the
subordination as provided in this Article Nine, and appoints the Trustee as such
Holder's attorney-in-fact for any and all such purposes (including, without
limitation, the timely filing of a claim for the unpaid balance of the Security
that such Holder holds in the form required in any insolvency or liquidation
proceeding and causing such claim to be approved).
If a proper claim or proof of debt in the form required in such
proceeding is not filed by or on behalf of all Holders prior to 30 days before
the expiration of the time to file such claims or proofs, then the holders or a
representative of any Senior Indebtedness of the Company are hereby authorized,
and shall have the right (without any duty), to file an appropriate claim for
and on behalf of the Holders.
SECTION 9.12. Payment. A payment on account of or with respect to any
Security shall include, without limitation, principal, premium or interest with
respect to or in connection with any optional redemption or purchase provisions,
any direct or indirect payment payable by reason of any other Indebtedness or
Obligation being subordinated to the Securities, and any direct or indirect
payment or recovery on any claim as a Holder relating to or arising out of this
Indenture or any Security, or the issuance of any Security, or the transactions
contemplated by this Indenture or referred to herein.
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ARTICLE 10
REDEMPTION OF SECURITIES
SECTION 10.01. Right of Optional Redemption; Prices. (a) On or after
____, 2003, the Company at its option may, at any time, redeem all, or from time
to time any part of, the Securities upon payment of the optional redemption
prices set forth in the form of Security hereinabove recited, together with
accrued and unpaid interest to the date fixed for redemption.
(b) At any time and from time to time prior to ____, 2001, the
Company may redeem in the aggregate up to 35% of the original principal amount
of the Securities with the proceeds of one or more Public Equity Offerings
commenced after the Issue Date, at a redemption price (expressed as a percentage
of principal amount) of __% plus accrued interest to the redemption date
(subject to the right of Holders of record on the relevant Regular Record Date
to receive interest due on an Interest Payment Date that is on or prior to the
redemption date); provided that at least $150 million aggregate principal amount
of the Securities must remain outstanding after each such redemption; and
provided further that any such redemption shall occur within 60 days of the date
of the closing of such Public Equity Offering.
SECTION 10.02. Notice of Redemption; Partial Redemptions. Notice of
redemption to the holders of Securities to be redeemed as a whole or in part
shall be given by mailing notice of such redemption by first class mail, postage
prepaid, at least 30 days and not more than 60 days prior to the date fixed for
redemption to such holders of Securities at their last addresses as they shall
appear upon the registry books. Any notice which is mailed in the manner herein
provided shall be conclusively presumed to have been duly given, whether or not
the Holder receives the notice. Failure to give notice by mail, or any defect in
the notice to the holder of any Security designated for redemption as a whole or
in part shall not affect the validity of the proceedings for the redemption of
any other Security.
The notice of redemption to each such Holder shall identify the
Securities to be redeemed (including CUSIP or CINS numbers) and shall specify
the principal amount of each Security held by such Holder to be redeemed, the
date fixed for redemption, the redemption price, the place or places of payment,
that payment will be made upon presentation and surrender of such Securities,
that interest accrued to the date fixed for redemption will be paid as specified
in said notice and that on and after said date interest thereon or on the
portions thereof to be redeemed will cease to accrue. In case any Security is to
be redeemed in part only the notice of redemption shall state the portion of the
principal amount thereof to be redeemed and shall state that on and after the
date fixed for redemption, upon surrender of such
82
Security, a new Security or Securities in principal amount equal to the
unredeemed portion thereof will be issued.
The notice of redemption of Securities to be redeemed at the option
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.
No later than 10:00 a.m. on the redemption date specified in the
notice of redemption given as provided in this Section, the Company will deposit
with the Trustee or with one or more paying agents (or, if the Company is acting
as its own paying agent, set aside, segregate and hold in trust as provided in
Section 3.04) an amount of money sufficient to redeem on the redemption date all
the Securities so called for redemption at the appropriate redemption price,
together with accrued interest to the date fixed for redemption. The Company
will deliver to the Trustee at least 70 days prior to the date fixed for
redemption an Officers' Certificate stating the aggregate principal amount of
Securities to be redeemed.
If less than all the Securities are to be redeemed, the Trustee shall
select, either pro rata, by lot or by any other method it shall in its sole
discretion deem fair and appropriate, Securities to be redeemed in whole or in
part; provided that no Security of $1,000 in principal amount or less shall be
redeemed in part. The Trustee shall promptly notify the Company in writing of
the Securities selected for redemption and, in the case of any Securities
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 Securities shall relate, in the case of
any Security redeemed or to be redeemed only in part, to the portion of the
principal amount of such Security which has been or is to be redeemed.
SECTION 10.03. Payment of Securities Called for Redemption. If notice
of redemption has been given as above provided, the Securities or portions of
Securities specified in such notice shall become due and payable on the date and
at the place stated in such notice at the applicable redemption price, together
with interest accrued to the date fixed for redemption, and on and after said
date (unless the Company shall default in the payment of such Securities at the
redemption price, together with interest accrued to said date) interest on the
Securities or portions of Securities so called for redemption shall cease to
accrue and, except as provided in Sections 5.05 and 11.06, such Securities shall
cease from and after the date fixed for redemption to be entitled to any benefit
or security under this Indenture, and the Holders thereof shall have no right in
respect of such Securities except the right to receive the redemption price
thereof and unpaid interest to the date fixed for redemption. On presentation
and surrender of such Securities at a place of payment specified in said notice,
said Securities or the specified portions thereof shall be paid
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and redeemed by the Company at the applicable redemption price, together with
interest accrued thereon to the date fixed for redemption; provided that any
semi-annual payment of interest becoming due on or prior to the date fixed for
redemption shall be payable to the holders of such Securities registered as such
on the relevant Regular Record Date subject to the terms and provisions of
Section 2.04 hereof.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid or duly
provided for, bear interest from the date fixed for redemption at the rate borne
by the Security.
Upon presentation of any Security redeemed in part only, the Company
shall execute and the Trustee shall authenticate and make available for delivery
to or on the order of the Holder thereof, at the expense of the Company, a new
Security or Securities, of authorized denominations, in principal amount equal
to the unredeemed portion of the Security so presented.
SECTION 10.04. Exclusion of Certain Securities from Eligibility for
Selection for Redemption. Securities shall be excluded from eligibility for
selection for redemption if they are identified by registration and certificate
number in a written statement signed by an authorized officer of the Company and
delivered to the Trustee at least 40 days prior to the last date on which notice
of redemption may be given as being owned of record and beneficially by, and not
pledged or hypothecated by either (a) the Company or (b) an entity specifically
identified in such written statement as directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company.
ARTICLE 11
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 11.01. Company's Option to Effect Defeasance or Covenant
Defeasance. The Company may at its option by a Board Resolution, at any time,
elect to have either Section 11.02 or Section 11.03 applied to the outstanding
Securities upon compliance with the conditions set forth below in this Article
Eleven.
SECTION 11.02. Legal Defeasance and Discharge. Upon the Company's
exercise under Section 11.01 hereof of the option applicable to this Section
11.02, the Company shall be deemed to have been discharged from any and all
Obligations with respect to all outstanding Securities (and any Guarantor will
be discharged from any and all Obligations in respect of its Subsidiary
Guarantee) on the date which is
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the 123rd day after the deposit referred to in Section 11.04(a); provided that
all of the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, such Legal Defeasance means that the Company
shall be deemed to have paid and discharged the entire Indebtedness represented
by the outstanding Securities, which shall thereafter be deemed to be
"outstanding" only for the purposes of Section 11.05 hereof and the other
Sections of this Indenture referred to in clauses (i) and (ii) of this Section
11.02, and to have satisfied all its other obligations under such Securities and
this Indenture (and the Trustee, on demand of and at the expense of the Company,
shall execute proper instruments acknowledging the same), except for the
following provisions which shall survive until otherwise terminated or
discharged hereunder: (i) the rights of Holders of outstanding Securities to
receive solely from the trust fund described in Section 11.04 hereof, and as
more fully set forth in such Section, payments in respect of the principal of,
premium, if any, and interest on such Securities when such payments are due,
(ii) the Company's obligations with respect to such Securities under Sections
2.01, 2.02, 2.05, 2.06, 2.07, 2.08, 2.10, 3.01, 3.02, 3.04 and 11.05 hereof,
(iii) the rights, powers, trusts, duties and immunities of the Trustee
hereunder, including, without limitation, the Trustee's rights under Section
5.07 hereof, and the Company's obligations in connection therewith and with this
Article Eleven. Subject to compliance with this Article Eleven, the Company may
exercise its option under this Section 11.02 notwithstanding the prior exercise
of its option under Section 11.03 hereof with respect to the Securities.
SECTION 11.03. Covenant Defeasance. Upon the Company's exercise under
Section 11.01 hereof of the option applicable to this Section 11.03, the Company
shall be released from its obligations under the covenants contained in Sections
3.08 through 3.17 and clauses (iii), (iv) and (v) of Section 8.01 hereof with
respect to the outstanding Securities on and after the date the conditions set
forth below are satisfied (hereinafter, "Covenant Defeasance"), and the
Securities shall thereafter be deemed not outstanding for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed outstanding for all other purposes hereunder. For this
purpose, such Covenant Defeasance means that, with respect to the outstanding
Securities, the Company may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such covenant,
whether directly or indirectly, by reason of any reference elsewhere herein to
any such covenant or by reason of any reference in any such covenant to any
other provision herein or in any other document and such omission to comply
shall not constitute a Default or an Event of Default under Section 4.01(c) or
(d) hereof, but, except as specified above, the remainder of this Indenture and
such Securities shall be unaffected thereby.
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SECTION 11.04. Conditions to Legal or Covenant Defeasance. The
following shall be the conditions to application of either Section 11.02 or
Section 11.03 hereof to the outstanding Securities:
(a) the Company has deposited with the Trustee, in trust, money
and/or U.S. Government Obligations that through the payment of interest and
principal in respect thereof in accordance with their terms will provide money
in an amount sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay the principal of, premium, if any, and accrued
interest on the Securities on the Stated Maturity of such payments in accordance
with the terms of the Indenture and the Securities;
(b) in the case of an election under Section 11.02 hereof, the
Company has delivered to the Trustee (i) either (x) an Opinion of Counsel to the
effect that Holders will not recognize income, gain or loss for Federal income
tax purposes as a result of the Company's exercise of its option under this
Article Eleven and will be subject to Federal income tax on the same amount and
in the same manner and at the same times as would have been the case if such
deposit, defeasance and discharge had not occurred, which opinion of counsel
must be based upon (and accompanied by a copy of) a ruling of the Internal
Revenue Service to the same effect unless there has been a change in applicable
Federal income tax law after the date of the Indenture such that a ruling is no
longer required or (y) a ruling directed to the Trustee received from the
Internal Revenue Service to the same effect as the aforementioned Opinion of
Counsel and (ii) an Opinion of Counsel to the effect that the creation of the
defeasance trust does not violate the Investment Company Act of 1940 and after
the passage of 123 days following the deposit, the trust fund will not be
subject to the effect of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Bankruptcy Code or
Section 15 of the New York Debtor and Creditor Law;
(c) in the case of an election under Section 11.03 hereof, the
delivery by the Company to the Trustee of (i) an Opinion of Counsel to the
effect that, among other things, the Holders will not recognize income, gain or
loss for Federal income tax purposes as a result of such deposit and defeasance
and will be subject to Federal income tax on the same amount and in the same
manner and at the same times as would have been the case if such deposit and
defeasance had not occurred and (ii) an Opinion of Counsel to the effect that
the creation of the defeasance trust does not violate the Investment Company Act
of 1940 and after the passage of 123 days following the deposit, the trust fund
will not be subject to the effect of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Bankruptcy
Code or Section 15 of the New York Debtor and Creditor Law;
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(d) immediately after giving effect to such deposit on a pro forma
basis, no Event of Default, or event that after the giving of notice or lapse of
time or both would become an Event of Default, shall have occurred and be
continuing on the date of such deposit or during the period ending on the 123rd
day after the date of such deposit, and such deposit 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 the Company is bound,
(e) if at such time the Securities are listed on a national
securities exchange, the Company has delivered to the Trustee an Opinion of
Counsel to the effect that the Securities will not be delisted as a result of
such deposit, defeasance and discharge,
(f) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit made by the Company pursuant to its
election under Sections 11.02 or 11.03 hereof was not made by the Company with
the intent of preferring the Holders of the Securities over the other creditors
of the Company with the intent of defeating, hindering, delaying or defrauding
creditors of the Company or others, and
(g) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the Legal Defeasance under Section
11.02 or the Covenant Defeasance under Section 11.03 (as the case may be) have
been complied with as contemplated by this Section 11.04.
SECTION 11.05. Deposited Money and Government Securities to be Held
in Trust; Other Miscellaneous Provisions. Subject to Section 11.06 hereof, all
money and U.S. Government Obligations (including the proceeds thereof) deposited
with the Trustee pursuant to Section 11.04 hereof in respect of the outstanding
Securities shall be held in trust and applied by the Trustee, in accordance with
the provisions of such Securities and this Indenture, to the payment, either
directly or through any paying agent (including the Company acting as paying
agent) as the Trustee may determine, to the Holders of such Securities of all
sums due and to become due thereon in respect of principal of, 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 money or U.S. Government
Obligations deposited pursuant to Section 11.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding
Securities.
Anything in this Article Eleven to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the Company's
request
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any money or U.S. Government Obligations held by it as provided in Section 11.04
hereof which, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered to the
Trustee (which may be the opinion delivered under Section 11.04(a) hereof), are
in excess of the amount thereof which would then be required to be deposited to
effect an equivalent Legal Defeasance or Covenant Defeasance.
SECTION 11.06. Repayment to Company. Any money deposited with the
Trustee or any paying agent, or then held by the Company, in trust for the
payment of the principal of, premium, if any, or interest on any Security and
remaining unclaimed for two years after such principal, premium, if any, or
interest has become due and payable shall be paid to the Company on its written
request or (if then held by the Company) shall be discharged from such trust;
and the Holder of such Security 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 The
New York Times and The Wall Street Journal (national edition), notice that such
money remains unclaimed and that, after a date specified therein, which shall
not be less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
SECTION 11.07. Reinstatement. If the Trustee or paying agent is
unable to apply any money or U.S. Government Obligations in accordance with
Section 11.02 or 11.03 hereof, as the case may be, by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, then the Company's obligations under
this Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to Section 11.02 or 11.03 hereof until such time
as the Trustee or paying agent is permitted to apply all such amounts in
accordance with Section 11.02 or 11.03 hereof, as the case may be; provided,
however, that, if the Company makes any payment of principal of, premium, if
any, or interest on any Security following the reinstatement of its obligations,
the Company shall be subrogated to the rights of the Holders of such Security to
receive such payment from the amounts held by the Trustee or paying agent.
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ARTICLE 12
MISCELLANEOUS PROVISIONS
SECTION 12.01. Incorporators, Stockholders, Officers, Directors,
Employees and Controlling Persons of Company Exempt from Individual Liability.
No recourse for the payment of the principal of, premium, if any, or interest on
any of the Securities or any claim based thereon or otherwise in respect
thereof, and no recourse under or upon any obligation, covenant or agreement of
the Company contained in this Indenture, or in any Security, or because of the
creation of any indebtedness evidenced thereby, shall be had against any
incorporator, as such, or against any past, present or future stockholder,
officer, director, employee or controlling person, as such, of the Company or of
any successor Person, either directly or through the Company or any successor
Person, under any rule of law, statute or constitutional provision or by the
enforcement of any assessment or by any legal or equitable proceeding or
otherwise, all such liability being expressly waived and released by the
acceptance of the Securities by the holders thereof and as part of the
consideration for the issue of the Securities.
SECTION 12.02. Provisions of Indenture for the Sole Benefit of
Parties and Holders. Except as set forth in Section 12.09, nothing in this
Indenture or in the Securities, expressed or implied, shall give or be construed
to give to any person, firm or corporation, other than the parties hereto and
their successors and the holders of the Securities, any legal or equitable
right, remedy or claim under this Indenture or under any covenant or provision
herein contained, all such covenants and provisions being for the sole benefit
of the parties hereto and their successors and of the holders of the Securities.
SECTION 12.03. Successors and Assigns of Company Bound by Indenture.
All the covenants, stipulations, promises and agreements in this Indenture
contained by or in behalf of the Company shall bind its successors and assigns,
whether so expressed or not.
SECTION 12.04. Notices and Demands on Company, Trustee and Holders.
Any notice or demand which by any provision of this Indenture is required or
permitted to be given or served by the Trustee or by the holders of Securities
to or on the Company may be given or served by being deposited postage prepaid,
first-class mail (except as otherwise specifically provided herein) addressed
(until another address of the Company is filed by the Company with the Trustee)
to Xxxx- Xxxxx, Inc., Xxx Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Legal Department, with a copy to the Treasurer. Any notice, direction, request
or demand by the Company or any Securityholder to or upon the Trustee shall be
deemed to
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have been sufficiently given or made, for all purposes, if given or made at the
Corporate Trust Office.
Where this Indenture provides for notice to Holders, such notice
shall be sufficiently given (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to each Holder entitled
thereto, at his last address as it appears in the Security Register. In any case
where notice to Holders is given by mail, neither the failure to mail such
notice, nor any defect in any notice so mailed, to any particular Holder shall
affect the sufficiency of such notice with respect to other Holders. Where this
Indenture provides for notice in any manner, such notice may be waived in
writing by the person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. The Trustee
may waive notice to it of any provision herein, and such waiver shall be deemed
to be for its convenience and discretion. Waivers of notice by Holders shall be
filed with the Trustee, but such filing shall not be a condition precedent to
the validity of any action taken in reliance upon such waiver.
In case, by reason of the suspension of or irregularities in regular
mail service, it shall be impracticable to mail notice to the Company and
Securityholders when such notice is required to be given pursuant to any
provision of this Indenture, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice.
SECTION 12.05. Officers' Certificates and Opinions of Counsel;
Statements to Be Contained Therein. Upon any application or demand by the
Company to the Trustee to take any action under any of the provisions of this
Indenture, the Company shall furnish to the Trustee an Officers' Certificate
stating that all conditions precedent provided for in this Indenture relating to
the proposed action have been complied with and an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent have been
complied with, except that in the case of any such application or demand as to
which the furnishing of such documents is specifically required by any provision
of this Indenture relating to such particular application or demand, no
additional certificate or opinion need be furnished.
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
provided for in this Indenture shall include (a) a statement that the person
making such certificate or opinion has read such covenant or condition, (b) a
brief statement as to the nature and scope of the examination or investigation
upon which the statements or opinions contained in such certificate or opinion
are based, (c) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or
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condition has been complied with and (d) a statement as to whether or not, in
the opinion of such person, such condition or covenant has been complied with.
Any certificate, statement or opinion of an officer of the Company
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of or representations by counsel, unless such officer knows that the
certificate or opinion or representations with respect to the matters upon which
his certificate, statement or opinion may be based as aforesaid are erroneous,
or in the exercise of reasonable care should know that the same are erroneous.
Any certificate, statement or opinion of counsel may be based, insofar as it
relates to factual matters or information which is in the possession of the
Company, upon the certificate, statement or opinion of or representations by an
officer or officers of the Company, unless such counsel knows that the
certificate, statement or opinion or representations with respect to the matters
upon which his certificate, statement or opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should know that the same are
erroneous.
Any certificate, statement or opinion of an officer of the Company or
of counsel may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an accountant or firm of
accountants in the employ of the Company, unless such officer or counsel, as the
case may be, knows that the certificate or opinion or representations with
respect to the accounting matters upon which his certificate, statement or
opinion may be based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous.
Any certificate or opinion of any independent firm of public
accountants filed with the Trustee shall contain a statement that such firm is
independent.
SECTION 12.06. Payments Due on Saturdays, Sundays and Holidays. If
the date of maturity of interest on or principal of the Securities or the date
fixed for redemption of any Security shall not be a Business Day, then payment
of interest or principal need not be made on such date, but may be made on the
next succeeding Business Day with the same force and effect as if made on the
date of maturity or the date fixed for redemption, and no interest shall accrue
for the period after such date.
SECTION 12.07. Conflict of Any Provision of Indenture with Trust
Indenture Act of 1939. If and to the extent that any provision of this Indenture
limits, qualifies or conflicts with another provision included in this Indenture
by operation of Sections 310 to 317, inclusive, of the Trust Indenture Act of
1939 (an "incorporated provision"), such incorporated provision shall control.
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SECTION 12.08. New York Law to Govern. This Indenture and each
Security shall be deemed to be a contract under the laws of the State of New
York, and for all purposes including the obligations of the Company and any
Guarantor and the rights of holders of the Securities arising out of or in
connection with the Securities, including the obligations of the Company and any
Guarantor to pay all principal, interest or other amounts payable under the
Indenture and such Security, will be governed by and shall be construed in
accordance with the laws of said State, without giving effect to the conflict of
laws provisions thereof, except as may otherwise be required by mandatory
provisions of law.
SECTION 12.09. Third Party Beneficiaries. Holders of Senior
Indebtedness of the Company are third party beneficiaries of this Indenture, and
any of them (or their representative) shall have the right to enforce the
provisions of this Indenture that benefit such holders.
SECTION 12.10. Counterparts. This Indenture may be executed in any
number of counterparts, each of which shall be an original; but such
counterparts shall together constitute but one and the same instrument.
SECTION 12.11. Effect of Headings. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of May ___, 1998.
XXXX-XXXXX INC.,
as Issuer
By
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Title:
THE BANK OF NEW YORK,
as Trustee
By
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Title:
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