Limitation on Asset Sales. The Company shall not, and shall not permit any Restricted Subsidiary to, make any Asset Sale unless the following conditions are met: (a) the Asset Sale is for at least Fair Market Value; and (b) at least 75% of the consideration received by the Company or its Restricted Subsidiaries consists of cash or Cash Equivalents; provided that for purposes of this clause (2), each of the following shall be considered cash or Cash Equivalents: (i) the assumption by the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement, (ii) Additional Assets, (iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, and (iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); (c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used: (i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below, (ii) to acquire Additional Assets; or (iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c). (d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to: (i) accumulated Excess Proceeds, multiplied by (ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.
Appears in 2 contracts
Sources: Indenture (Foresight Energy LP), Indenture (Foresight Energy LP)
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s senior management or, in the case of an Asset Sale in excess of $25.0 million, the Board of Directors of the Company);
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of (x) cash or Cash Equivalents; provided , (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business, or (z) Capital Stock in one or more Persons engaged in a Permitted Business that for purposes of this clause (2), each are or thereby become Restricted Subsidiaries of the following shall be considered cash or Cash Equivalents:
Company, and, in each case, such consideration is received at the time of such disposition; provided, further, however, that the amount of (ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser (other than liabilities that are promptlyby their terms subordinated to the Securities) that are assumed by the transferee of any such assets, but in and (b) any event within 90 days of notes or other securities received by the closing, Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents within 90 days after such Asset Sale (to the extent of the cash or Cash Equivalents actually so received, converted) shall be deemed to be cash or Cash Equivalents actually so converted for the purposes of this provision only; and
(iviii) any Designated Non-upon the consummation of such Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Consideration received Proceeds relating to such Asset Sale within 365 days of receipt thereof to (A) make an Investment (i) in properties and assets that replace the properties and assets that were the subject of such Asset Sale or (ii) in properties and assets that will be used by the Issuer or a Restricted Subsidiary in a Permitted Business (clauses (i) and (ii) collectively referred to as “Replacement Assets”), (B) repay Indebtedness of the Issuer and the Restricted Subsidiaries under the Credit Agreement (and, to the extent such Indebtedness under the Credit Agreement is comprised of a revolving credit facility or arrangement, simultaneously effect a permanent reduction of commitments thereunder in an amount equal to such repayment) or (C) a combination of (A) and (B) of this clause (iii). On the 366th day after such Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clause (iii) of the immediately preceding paragraph (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred offer to in clause (ii) or (iii) above shall be treated as a permitted application purchase from the Holders of the Securities, and, if required by the terms of any Other Pari Passu Obligations, from the holders of such Other Pari Passu Obligations (the “Net Cash Proceeds from Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, on a pro rata basis, an amount of Securities and Other Pari Passu Obligations equal to the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Securities and Other Pari Passu Obligations to be purchased, plus accrued and unpaid interest thereon, if any, to the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360purchase. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with such Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.18. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $25.0 million (the “Net Proceeds Trigger”) resulting from an one or more Asset Sale for general corporate purposes Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $25.0 million, shall be applied as required pursuant to the end of the 360-day period referred to in the first sentence second preceding paragraph of this Section 4.09(c4.18).. Notice of each Net Proceeds Offer pursuant to this Section 4.18 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and materials necessary to enable such Holders to tender Securities pursuant to the Net Proceeds Offer and shall state the following terms:
(d1) When that Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to proration as hereinafter described in the event the Net Proceeds Offer is oversubscribed) in denominations of $2,000 or in integral multiples of $1,000 of principal amount, at the applicable purchase price;
(2) that the Net Proceeds Offer is being made pursuant to this Section 4.18 and that all Securities tendered will be accepted for payment; provided, however, that if the principal amount of Securities or Other Pari Passu Obligations tendered in the Net Proceeds Offer exceeds the aggregate amount of the Net Cash Proceeds Offer Amount, the Company shall select the Securities or Other Pari Passu Obligations to be purchased on a pro rata basis (based on amounts tendered);
(3) the purchase price (including the amount of accrued interest, if any) and the Net Proceeds Offer Payment Date (which shall be no earlier than 30 days nor later than 60 days from Asset Sales the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(4) that any Security not applied tendered will continue to accrue interest;
(5) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(and within 6) that Holders electing to have a Security purchased pursuant to the time frame set Net Proceeds Offer will be required to surrender the Security, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day prior to the Net Proceeds Offer Payment Date;
(7) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)the name of the Holder, the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes Security, the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; and
(y) the denominator of which is 8) that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers’ Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon, set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so to the Holder thereof. For purposes of this Section 4.18, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that only Notes in multiples of $1,000 principal amount (and in a minimum the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 the Securities and any integral multiple of $1.00 in excess thereof with respect Other Pari Passu Obligations tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.18, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.18 by virtue thereof. The provisions of such conflictthis Section 4.18 and other provisions contained in this Indenture relating to the Company’s obligation to make a Net Proceeds Offer may be waived or modified with the written consent of the Holders of a majority in principal amount of the Securities.
Appears in 2 contracts
Sources: Indenture (Clean Harbors Inc), Indenture (Clean Harbors Inc)
Limitation on Asset Sales. The Company shall not, and shall not cause or permit any Restricted Subsidiary to, directly or indirectly, make any Asset Sale Sale, unless the following conditions are met:
(ax) the Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least equal to the Fair Market Value; and
Value of the assets sold or otherwise disposed of and (by) at least 75% of the such consideration received by the Company or its Restricted Subsidiaries consists of (i) cash or Cash Equivalents, (ii) Replacement Assets, (iii) publicly traded Equity Interests of a Person who is engaged primarily in a Telecommunications Business; provided provided, however, that for purposes of this clause the Company or such Restricted Subsidiary shall sell (2a "Monetization Sale"), each of the following shall be considered for cash or Cash Equivalents:
, such Equity Interests to a third Person (other than to the Company or a Subsidiary thereof) at a price not less than the Fair Market Value thereof within 365 days of the consummation of such Asset Sale, or (iv) any combination of the foregoing clauses (i) the assumption by the purchaser through (iii). The amount of Debt or other obligations or liabilities any (as shown on the Company’s most recent balance sheet or in the footnotes theretox) Indebtedness (other than any Subordinated Debt or other obligations or liabilities subordinated in right of payment to the NotesIndebtedness) of the Company or a any Restricted Subsidiary pursuant that is actually assumed by the transferee in such Asset Sale and from which the Company and the Restricted Subsidiaries are fully released shall be deemed to operation be cash for purposes of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations determining the percentage of cash consideration received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted and (y) notes or other similar obligations received by the Company or such any Restricted Subsidiary from such transferee that are immediately converted, sold or exchanged (or are converted, sold or exchanged within 365 days of the related Asset Sale) by the Company or any Restricted Subsidiary into cash shall be deemed to cash or Cash Equivalentsbe cash, in an amount equal to the extent net cash proceeds realized upon such conversion, sale or exchange for purposes of determining the percentage of cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Subsidiary. Any Net Cash Proceeds from an any Asset Sale, the Net Cash Proceeds may be used:
(i) Sale or any Monetization Sale that are not invested in Replacement Assets or used to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to and permanently reduce the commitment thereunder by such amount) or (B) the Notes and commitments under Indebtedness of any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated Subsidiary within 180 365 days of the end 47 -41- consummation of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior or Monetization Sale shall constitute "Excess Proceeds" subject to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When disposition as provided below. Within 40 days after the aggregate amount of Net Cash Excess Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) equals or exceeds $25.0 million (“Excess Proceeds”)10.0 million, the Issuers must, within 30 days, Company shall make an offer Offer to purchasePurchase, in accordance with Section 3.02from all Holders, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding that aggregate principal amount of Securities as can be purchased with the Notes and (y) the denominator Note Portion of which is Excess Proceeds at a price in cash equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to any purchase date. To the extent that the aggregate amount of principal and accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are Securities validly tendered and not withdrawn pursuant to an Offer to Purchase is less than the offerExcess Proceeds, the Issuers shall purchase Notes having an Company may use such surplus for general corporate purposes. If the aggregate amount of principal and accrued interest of Securities validly tendered and not withdrawn by Holders thereof exceeds the amount of Securities that can be purchased with the Note Portion of Excess Proceeds, Securities to be purchased will be selected pro rata based on the aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments of Securities tendered by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest)each Holder. Upon completion of the an Offer to Purchase, the amount of Excess Proceeds will with respect to the applicable Asset Sale or Monetization Sale shall be reset at to zero. In the event that any other Indebtedness of the Company that ranks pari passu with the Securities (the "Other Debt") requires an offer to purchase to be made to repurchase such Other Debt upon the consummation of an Asset Sale, and any the Company may apply the Excess Proceeds remaining after consummation of the Offer otherwise required to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant applied to an Offer to Purchase to offer to purchase such Other Debt and to an Offer to Purchase so long as the amount of such Excess Proceeds applied to purchase the Securities is not less than the Note Portion of Excess Proceeds. With respect to any Excess Proceeds, the Company shall make the Offer to Purchase in respect thereof at the same time as the analogous offer to purchase is made pursuant to this Section 4.09. To any Other Debt and the extent that Purchase Date in respect thereof shall be the provisions of same as the purchase date in respect thereof pursuant to any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflictOther Debt.
Appears in 2 contracts
Sources: Indenture (Hermes Europe Railtel B V), Indenture (Global Telesystems Group Inc)
Limitation on Asset Sales. The Company shall not, and shall not cause or permit any of its Restricted Subsidiary Subsidiaries to, directly or indirectly, make any Asset Sale Sale, unless the following conditions are met:
(ai) the Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least equal to the Fair Market Value; and
Value of the assets sold or otherwise disposed of and (bii) at least 7585% of such consideration consists of (A) cash or Cash Equivalents, (B) properties and assets to be used in the business of the Company and its Restricted Subsidiaries and/or (C) Equity Interests in any Person which thereby becomes a Wholly-Owned Restricted Subsidiary of the Company. The amount of any (i) Indebtedness (other than any subordinated Indebtedness) of the Company or any Restricted Subsidiary of the Company that is actually assumed by the transferee in such Asset Sale and from which the Company and the Restricted Subsidiaries of the Company are fully released shall be deemed to be cash for purposes of determining the percentage of cash consideration received by the Company or any of its Restricted Subsidiaries consists of cash or Cash Equivalents; provided that for purposes of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
and (ii) Additional Assets,
(iii) instruments, notes, securities notes or other similar obligations received by the Company or any of its Restricted Subsidiaries from such Restricted Subsidiary from the purchaser transferee that are promptlyimmediately converted, but in any event sold or exchanged (or are converted, sold or exchanged within 90 thirty days of the closing, converted related Asset Sale) by the Company or such any of its Restricted Subsidiary Subsidiaries into cash shall be deemed to cash or Cash Equivalentsbe cash, in an amount equal to the extent net cash proceeds realized upon such conversion, sale or exchange, for purposes of determining the percentage of cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value any of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more its Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.
Appears in 2 contracts
Sources: Indenture (Metris Companies Inc), Indenture (Metris Direct Inc)
Limitation on Asset Sales. The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Asset Sale is for Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Board of Directors of the Company, and evidenced by a board resolution, which determination shall be conclusive);
(b2) at least not less than 75% of the consideration (excluding, in the case of an Asset Sale (or series of related Asset Sales) of assets, by way of relief from, or by another Person assuming responsibilities for, any liabilities, contingent or otherwise, that are not Indebtedness) received by the Company or its such applicable Restricted Subsidiaries consists Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; provided that this clause (2) shall not apply to any Asset Sale (or series of related Asset Sales), involving assets that accounted for less than one percent of Consolidated EBITDA during the period of the most recent four consecutive fiscal quarters ending prior to the date of such Asset Sale for which consolidated financial statements of the Company are available; provided, further, that only for purposes of this clause (2), each of ) the following shall be considered cash or Cash Equivalentsdeemed to constitute cash:
(ia) the assumption by outstanding principal amount of Indebtedness of the purchaser of Debt Company or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) any Restricted Subsidiary (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment (x) Capital Stock which constitutes Indebtedness and (y) Indebtedness to the NotesCompany or any Restricted Subsidiary) of assumed by the transferee (which shall not constitute the Company or a Restricted Subsidiary Subsidiary) pursuant to operation of law the respective Asset Sale, so long as the Company or a customary novation agreement,such Restricted Subsidiary is irrevocably and unconditionally released from all liability under such Indebtedness; and
(iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company or such any Restricted Subsidiary from such transferee that are, within 180 days after the purchaser that are promptly, but in any event within 90 days date of the closingrespective Asset Sale, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received, received in that conversion); and
(iv3) any Designated Non-Cash Consideration the Asset Sale Proceeds received by the Company or such Restricted Subsidiary in are applied:
(a) to the extent the Company or any such Restricted Subsidiary, as the case may be, elects, or is required, to prepay, repay or purchase indebtedness under any then existing Senior Indebtedness of the Company or any such Restricted Subsidiary within 365 days following the receipt of the Asset Sale having Proceeds from any Asset Sale;
(b) to the extent the Company elects, to an aggregate Fair Market Valueinvestment in assets (including Capital Stock or other securities purchased in connection with the acquisition of Capital Stock or property of another Person) used or useful in businesses similar, taken together with all other Designated Non-Cash Consideration received pursuant reasonably related, ancillary or complementary to this clause the business of the Company (dincluding extensions or developments thereof) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since or any such Restricted Subsidiary as conducted on the Issue Date Date; provided that such investment occurs (with the Fair Market Value or a definitive agreement committing so to invest is entered) within 365 days following receipt of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value)such Asset Sale Proceeds;
(c) Within 360 days to the extent of the balance of Available Asset Sale Proceeds after the receipt of any Net Cash Proceeds from an Asset Saleapplication in accordance with clause (a) or (b), the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, if on such 365th day in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amountclauses (3)(a) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated3)(b), the Net Cash Available Asset Sale Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09exceed $10.0 million, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from shall apply an amount equal to the Available Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior Proceeds to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchaserepurchase the Notes, at a purchase price in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is cash equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof plus accrued interest toand unpaid interest, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerif any, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount date (an "Excess Proceeds Offer"). Notwithstanding the foregoing, in the event that a Restricted Subsidiary that is not a Wholly Owned Restricted Subsidiary dividends or distributes to all of its stockholders on a pro rata basis any proceeds of an Asset Sale to the extent practicableCompany or another Restricted Subsidiary, with adjustments by the Company so or such Restricted Subsidiary need only apply its share of such proceeds in accordance with the preceding clauses (a), (b) and (c). If an Excess Proceeds Offer is not fully subscribed, the Company may retain the portion of the Available Asset Sale Proceeds not required to repurchase Notes. If the Company is required to make an Excess Proceeds Offer, the Company shall mail, within 30 days following the date specified in clause (3)(c) above, a notice to the Holders stating, among other things:
(1) that only such Holders have the right to require the Company to apply the Available Asset Sale Proceeds to repurchase such Notes at a purchase price in multiples cash equal to 100% of $1,000 the principal amount thereof plus accrued and unpaid interest, if any, to the purchase date;
(2) the purchase date, which shall be no earlier than 30 days and not later than 45 days from the date such notice is mailed;
(3) the instructions that each Holder must follow in order to have such Notes purchased; and
(4) the calculations used in determining the amount of Available Asset Sale Proceeds to be applied to the purchase of such Notes. In the event of the transfer of substantially all of the property and assets of the Company and its Restricted Subsidiaries, taken as a whole, to a Person in a minimum amount transaction permitted under Section 5.01 below, the successor Person shall be deemed to have sold the properties and assets of $1,000) will be purchased (or if a PIK Payment has been madethe Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.09, in denominations and shall comply with the provisions of $1.00 and any integral multiple of $1.00 in excess thereof this Section 4.09 with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenturesuch deemed sale as if it were an Asset Sale. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09Excess Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02the "Asset Sale" provisions of this Indenture, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 by virtue of such conflictthereof.
Appears in 1 contract
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Company or the Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; and
equal to the fair market value of the assets sold or otherwise disposed of (bas determined in good faith by the Company's senior management, or in the case of an Asset Sale in excess of $5.0 million, the Board of Managers), and (ii) at least 75% of the consideration received by the Company or its such Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale is in the form of (x) cash or Cash Equivalents, (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business or (z) Capital Stock in one or more Persons engaged in a Permitted Business that are or thereby become Restricted Subsidiaries of the Company, and, in each case, such consideration is received at the time of such disposition; provided that for purposes the amount of this clause (2), each a) any liabilities of the following shall be considered cash Company or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities (as any such Restricted Subsidiary which are shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt liabilities that are subordinated to the Securities) that are assumed by the transferee of any such assets, and (b) any notes or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 180 days after such Asset Sale (to the extent of the cash received in the conversion) shall be deemed to be cash for the purposes of this provision only; and (iii) upon the consummation of an Asset Sale, the Company will apply, or cause such Restricted Subsidiary to apply, the Net Cash Equivalents actually so receivedProceeds relating to such Asset Sale within 360 days of receipt thereof either (a) to prepay any Senior Debt, Guarantor Senior Debt or any Indebtedness of a Restricted Subsidiary of the Company and
, in the case of any Senior Debt, Guarantor Senior Debt or Indebtedness of a Restricted Subsidiary of the Company under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility (ivor effect a permanent reduction in availability under such revolving credit facility regardless of the fact that no prepayment is required), (b) to make an Investment (x) in properties and assets that replace the properties and assets that were the subject of such Asset Sale, (y) in properties and assets that will be used in a Permitted Business or (z) permitted by clause (i) of the definition of "Permitted Investments" or (c) a combination of prepayment and investment permitted by the foregoing clauses (iii)(a) and (iii)(b). Pending the final application of the Net Cash Proceeds, the Company or such Restricted Subsidiary may temporarily reduce Indebtedness or otherwise invest such Net Cash Proceeds in any Designated Non-manner not prohibited by this Indenture. On the 361st day after an Asset Sale or such earlier date, if any, as the senior management, Board of Managers or Board of Directors of such Restricted Subsidiary determines not to apply the Net Cash Consideration received Proceeds relating to such Asset Sale as set forth in clauses (iii)(a), (iii)(b) and/or (iii)(c) of the next preceding sentence (each, a "Net Proceeds Offer Trigger Date"), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(a), (iii)(b) and (iii)(c) of the next preceding sentence (each a "Net Proceeds Offer Amount") shall be applied by the Company or such Restricted Subsidiary in to make an offer to repurchase (the Asset Sale having an aggregate Fair Market Value"Net Proceeds Offer") on a date (the "Net Proceeds Offer Payment Date") not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, taken together with from all other Designated Non-Cash Consideration received pursuant Holders of Securities on a pro rata basis, that amount of Securities equal to this clause the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Securities to be repurchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, that if the Company so elects (d) that or is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in required by the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt terms of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking Indebtedness that ranks pari passu with the Liens securing Securities), such Net Proceeds Offer may be made ratably to purchase the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business Securities and other Indebtedness of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of ranks pari passu with the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360Securities. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this covenant. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $5.0 million resulting from one or more Asset Sales (at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in excess of $5.0 million, shall be applied as otherwise required pursuant to this paragraph). In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted by Section 5.1, which transaction does not constitute a Change of Control, the successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this covenant, and shall comply with the provisions of this covenant with respect to such deemed sale as if it were an Asset Sale Sale. In addition, the fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for general corporate purposes (including of this covenant. Notice of each Net Proceeds Offer pursuant to this Section 4.16 shall be mailed or caused to be mailed, by first class mail, by the Company within 45 days following the applicable Net Proceeds Offer Trigger Date to all Holders of Securities at their last registered addresses, with a reduction in borrowings under any revolving credit facility) prior copy to the end Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and materials necessary to enable such Holders to tender Securities pursuant to the 360-day period referred Net Proceeds Offer and shall state the following terms:
(1) that Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to prorationing as hereinafter described in the first sentence event the Net Proceeds Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price;
(2) that the Net Proceeds Offer is being made pursuant to this Section 4.09(c).
(d) When 4.16 and that all Securities tendered will be accepted for payment; provided, however, that if the principal amount of Securities tendered in the Net Proceeds Offer exceeds the aggregate amount of Net Cash Proceeds Offer Amount, the Company shall select the Securities to be purchased on a pro rata basis (based on amounts tendered);
(3) the purchase price (including the amount of accrued interest, if any) and the purchase date (which shall be no earlier than 30 days nor later than 60 days from Asset Sales the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(4) that any Security not applied tendered will continue to accrue interest;
(5) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(and within 6) that Holders electing to have a Security purchased pursuant to the time frame set Net Proceeds Offer will be required to surrender the Security, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Offer Payment Date;
(7) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)the name of the Holder, the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes Security the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; and
(y) the denominator of which is 8) that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers' Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so to the Holder thereof. For purposes of this Section 4.16, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that only Notes in multiples of $1,000 principal amount (and in a minimum the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect the Securities tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.16, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.16 by virtue of such conflictthereof.
Appears in 1 contract
Sources: Indenture (Quality Distribution Inc)
Limitation on Asset Sales. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of such Asset Sale is for at least Fair Market Valueequal to the fair market value of the assets or Equity Interests issued or sold or otherwise disposed of, as approved in good faith by the Company’s Board of Directors; and
(b2) at least 75% of the consideration therefor received by the Company or its such Restricted Subsidiaries consists Subsidiary is in the form of cash or Cash Equivalents; provided that for . For purposes of this clause provision only (2and specifically not for the purposes of the definition of “Net Proceeds”), each of the following shall be considered cash or Cash Equivalentsdeemed to be cash:
(i) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than contingent liabilities and liabilities that are by their terms subordinated to operation the Notes or any Subsidiary Guarantee) that are assumed by the transferee of law or a customary novation agreement,any such assets; and
(ii) Additional Assets,
(iii) instrumentsany securities, notes, securities notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, are converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received, received in that conversion); and
(iviii) the fair market value of (x) any Designated Non-Cash Consideration assets (other than securities or current assets) received by the Company or such any Restricted Subsidiary that will be used or useful in the Asset Sale having an aggregate Fair Market Valuea Related Business, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (dy) Equity Interests in a Person that is at a Restricted Subsidiary or in a Person engaged in a Related Business that time outstanding, not to exceed shall become a Restricted Subsidiary immediately upon the acquisition of such Equity Interests by the Company or the applicable Restricted Subsidiary or (z) a combination of (x) $10.0 million per fiscal year and (y); provided that the determination of the fair market value of assets or Equity Interests in excess of $50.0 million received in any transaction or series of related transactions shall be evidenced by an Officers’ Certificate delivered to the Trustee.
(b) $30.0 million in the aggregate since Within a period of 360 days (commencing after the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(cDate) Within 360 days before or after the receipt of any Net Cash Proceeds of any Asset Sale (provided that if during such 360-day period after the receipt of any such Net Proceeds the Company (or the applicable Restricted Subsidiary) enters into a definitive binding agreement committing it to apply such Net Proceeds in accordance with the requirements of clause (B), (D) or (E) of this paragraph after such 360th day, such 360-day period will be extended with respect to the amount of Net Proceeds so committed for a period not to exceed 120 days until such Net Proceeds are required to be applied in accordance with such agreement (or, if earlier, until termination of such agreement)), the Company or such Restricted Subsidiary, at its option, may apply an amount equal to the Net Proceeds from an such Asset Sale, the Net Cash Proceeds may be used:
(iA) to permanently repay repay, prepay, redeem or repurchase Indebtedness (Aother than securities) Debt outstanding under Credit Facilities or Indebtedness of a Restricted Subsidiary that is not a Guarantor (other than Indebtedness of such Restricted Subsidiary owed to the Credit Agreement (Company or any of its Restricted Subsidiaries) and, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the repayment of the availability under such revolving credit facility (or effect a permanent reduction in the availability under such revolving credit facility regardless of the Credit Agreement, fact that no prepayment is required in order to permanently reduce the commitment thereunder by such amount) or do so (in which case no prepayment shall be required));
(B) to acquire Equity Interests in a Person that is a Restricted Subsidiary or in a Person engaged in a Related Business that shall become a Restricted Subsidiary immediately upon the Notes and any Debt secured acquisition of such Equity Interests by Liens ranking pari passu with the Liens securing Company or the Notes (if any) through making the Offer to Purchase below,applicable Restricted Subsidiary;
(iiC) to make capital expenditures;
(D) to acquire Additional Assetsother assets (other than securities or current assets) that will be used or useful in a Related Business;
(E) to make Investments in Joint Ventures pursuant to clauses (13) and (14) of the definition of “Permitted Investments”; or
(iiiF) to make capital expenditures in a Permitted Business combination of prepayment and investment permitted by the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause foregoing clauses (iiA), (B), (C), (D) or and (iiiE).
(c) above shall be treated as a permitted Pending the final application of the such Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09Proceeds, the Company or any Restricted Subsidiary may use temporarily reduce borrowings under the Credit Facilities or any other revolving credit facility or Receivables Financings, if any, or otherwise invest such Net Proceeds in Cash Proceeds from Equivalents, in each case in a manner not prohibited by this Indenture. Subject to the last sentence of this paragraph, on the 361st day (as extended pursuant to the provisions in Section 4.10(b)) after an Asset Sale for general corporate purposes or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Proceeds relating to such Asset Sale as set forth in clause (A), (B), (C), (D), (E) or (F) of Section 4.10(b) (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Proceeds which have not been applied (or committed to be applied pursuant to a definitive agreement as described in Section 4.10(b)) on or before such Net Proceeds Offer Trigger Date as permitted in clause (A), (B), (C), (D), (E) or (F) of Section 4.10(b) (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary to make an offer to purchase (the “Net Proceeds Offer”) on the Purchase Date, from all Holders (and, if required by the terms of any other Indebtedness of the Company ranking pari passu with the Notes in right of payment and which has similar provisions requiring the Company either to make an offer to repurchase or to otherwise repurchase, redeem or repay such Indebtedness with the proceeds from Asset Sales, including the 2018 Notes and the related Guarantees thereof (the “Pari Passu Indebtedness”), from the holders of such Pari Passu Indebtedness) on a reduction pro rata basis (in borrowings under any revolving credit facility) prior proportion to the end respective principal amounts or accreted value, as the case may be, of the 360Notes and any such Pari Passu Indebtedness) an aggregate principal amount of Notes (plus, if applicable, an aggregate principal amount or accreted value, as the case may be, of Pari Passu Indebtedness) equal to the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Notes (or 100% of the principal amount or accreted value, as the case may be, of such Pari Passu Indebtedness), plus accrued and unpaid interest thereon, if any, to the Purchase Date; provided, however, that if at any time any non-day period referred cash consideration received by the Company or any Restricted Subsidiary, as the case may be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Proceeds thereof shall be applied in accordance with this covenant. The Company may defer the first sentence Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $50.0 million resulting from one or more Asset Sales (at which time the entire unutilized Net Proceeds Offer Amount, and not just the amount in excess of $50.0 million, shall be applied as required pursuant to this Section 4.09(cparagraph, and in which case the Net Proceeds Offer Trigger Date shall be deemed to be the earliest date that the Net Proceeds Offer Amount is equal to or in excess of $50.0 million).
(d) When To the extent that the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to the Notes (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)plus, if applicable, the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount or accreted value, as the case may be, of the Notes and (yany Pari Passu Indebtedness) the denominator of which tendered pursuant to a Net Proceeds Offer is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer Amount, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (may use such excess Net Proceeds Offer Amount for general corporate purposes or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any other purpose not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law.
(e) The Issuers shall Company or the applicable Restricted Subsidiary, as the case may be, will comply with the requirements of 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 connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 4.10 or Section 3.023.09, the Issuers Company or such Restricted Subsidiary shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 Indenture by virtue of such conflictthereof.
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall will not, and shall will not permit any of the Restricted Subsidiary Subsidiaries to, make directly or indirectly, consummate any Asset Sale unless the following conditions are metunless:
(a1) the Company or the Restricted Subsidiary, as the case may be, receives consideration at the time of consummation of such Asset Sale is for at least equal to the Fair Market ValueValue of the assets or Equity Interests issued or sold or otherwise disposed of; and
(b2) at least 75% of the consideration received in such Asset Sale by the Company or its such Restricted Subsidiaries consists Subsidiary is in the form of cash or Cash Equivalents; provided provided, that for the foregoing requirements shall not apply with respect to any Involuntary Transfer.
(b) For purposes of this clause (2Section 4.10(a), each of the following shall will be considered cash or Cash Equivalentsdeemed to be cash:
(i1) the assumption by the purchaser of Debt any Indebtedness or other obligations or liabilities (liabilities, as shown on the Company’s most recent consolidated balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) sheet, of the Company or a any Restricted Subsidiary pursuant (other than contingent liabilities and liabilities that are by their terms subordinated to operation the Notes or any Guarantee) that are assumed, repaid or retired by the transferee of law any such assets so long as the Company or a customary novation agreement,such Restricted Subsidiary is released from further liability in respect thereof; and
(ii2) Additional Assets,
(iii) instrumentsany securities, notes, securities notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptlyare, but in any event within 90 180 days of the closingafter receipt thereof, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, to the extent of the cash or Cash Equivalents received in that conversion; provided, however, that to the extent such securities consist of publicly-traded common equity securities of a Public Company having a world-wide market capitalization of at least $500 million at the time of receipt by the Company or the applicable Restricted Subsidiary, such 180-day period shall be extended to 365 days (and provided, further, that a binding commitment made within such 365-day period by the Company or the applicable Restricted Subsidiary to convert such securities into cash or Cash Equivalents shall be permitted under this clause (2) so long as such securities are actually so received, andconverted within 545 days from the receipt thereof);
(iv3) any Designated Non-Cash Noncash Consideration received by the Company or such any of the Restricted Subsidiary in Subsidiaries from the Asset Sale transferee having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this clause (d3) that is at that time outstanding, not to exceed (x) $10.0 15 million per fiscal year and (y) $30.0 million in at the aggregate since time of the Issue Date receipt of such Designated Noncash Consideration (with the Fair Market Value of each item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value);; and
(4) cash held in escrow as security for any purchase price settlement, for damages, in respect of a breach of representations and warranties or certain covenants or for payment of other contingent obligations in connection with the Asset Sale, in each case until released from escrow and received by the Company or any of the Restricted Subsidiaries.
(c) Within 360 365 days after the receipt of any Net Cash Proceeds from an Asset SaleSale (including, without limitation, an Involuntary Transfer other than an Involuntary Vessel Transfer, but excluding any Vessel Sale or Involuntary Vessel Transfer), the Company or the applicable Restricted Subsidiary, as the case may be, may apply such Net Cash Proceeds may be usedat its option to any combination of the following:
(i1) (a) to permanently purchase, repay (A) or prepay Superpriority Debt outstanding under the Credit Agreement (and, if such Superpriority Debt consists of revolving debt, to correspondingly reduce commitments with respect thereto) or cash collateralize letters of credit in respect of Superpriority Debt or (b) to purchase, repay or prepay First Lien Debt other than Superpriority Debt; provided that, to the extent purchases, repayments or prepayments of any First Lien Debt are made pursuant to this clause (1)(b), the Company shall equally and ratably redeem the Notes as provided in Section 3.07 or repay or offer to repay Notes, through open-market purchases or by making an offer to Holders in accordance with the procedures set forth in Section 3.09 and this Section 4.10 for an Asset Sale Offer;
(2) to acquire all or substantially all of the assets of, or any Capital Stock of, any Person primarily engaged in a Permitted Business, if, in the case of the repayment any such acquisition of the revolving credit facility under the Credit AgreementCapital Stock, to permanently reduce the commitment thereunder by such amount) Person is or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,becomes a Restricted Subsidiary as a result of such acquisition;
(ii3) to acquire Additional Assetsmake a capital expenditure that is used or useful in a Permitted Business; or
(iii4) to make capital expenditures acquire other assets that are not classified as current assets under GAAP and that are used or useful in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (iiincluding, without limitation, Collateral Vessels, related assets and any related Ready for Sea Costs) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date make any deposit, installment or progress payment in respect of such commitment; assets or payment of any related Ready for Sea Costs, provided that (x) such investment is consummated a binding commitment made within 180 days of the end of the 360365-day period referred described above by the Company or the applicable Restricted Subsidiary to apply Net Proceeds from an Asset Sale in accordance with clauses (2), (3) and/or (4) above shall satisfy the first sentence requirements of this paragraph such clauses with respect to such Net Proceeds so long as such Net Proceeds are actually so applied within 545 days from the receipt thereof from such Asset Sale and (y) if all or any portion of the assets sold or transferred in such acquisition is not consummated within Asset Sale constituted Collateral, in the period case of any application of Net Proceeds pursuant to clause (2), (3) or (4) above, the Company shall, or shall cause the applicable Restricted Subsidiary to, pledge any assets (including, without limitation, any acquired Capital Stock) acquired with such Net Proceeds to secure the Notes Obligations on a first-priority secured basis (subject to the payment priority in favor of the holders of Superpriority Debt, if any, set forth in clause (xthe Collateral Documents and subject to Permitted Collateral Liens) or such binding commitment is terminated, pursuant to the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof Collateral Documents in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c)Indenture.
(d) Pending the final application of any Net Proceeds, the Company or the applicable Restricted Subsidiary may apply the Net Proceeds to temporarily reduce outstanding revolving credit Indebtedness of the Company or any of the Restricted Subsidiaries, respectively, or invest the Net Proceeds in cash and Cash Equivalents.
(e) Any Net Proceeds from Asset Sales (excluding any Vessel Sale or Involuntary Vessel Transfer) that are not applied or invested as provided in Section 4.10(c) will constitute “Excess Proceeds.” When the aggregate amount of Net Cash Excess Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)10 million, the Issuers mustCompany shall, within 30 days10 Business Days thereof, make an offer to purchase, (an “Asset Sale Offer”) in accordance with Section 3.023.09 to all Holders and holders of any other First Lien Debt containing provisions similar to those set forth in this Indenture with respect to offers to purchase, Notes having a principal amount equal to:
(i) accumulated Excess Proceedsprepay or redeem such First Lien Debt with the proceeds of sales of assets to purchase, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of prepay or redeem the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all such other First Lien Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for a pro rata basis in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis Excess Proceeds. The repurchase date in any Asset Sale Offer shall be specified by the Company, which date will be no earlier than 30 days and no later than 60 days from the date the notice of such Asset Sale Offer is delivered. The offer price in any Asset Sale Offer will be equal to 100% of the principal amount, plus accrued and unpaid interest and Additional Amounts, if any, to, but not including, the date of purchase, subject to the extent practicablerights of Holders of record on the relevant record date to receive interest due on the relevant Interest Payment Date, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, payable in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest)cash. Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and If any Excess Proceeds remaining remain after consummation of an Asset Sale Offer, the Offer to Purchase Company and the Restricted Subsidiaries may be used use those Excess Proceeds for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes or other First Lien Debt tendered in such Asset Sale Offer exceeds the amount of Excess Proceeds, the Company will select the Notes and other First Lien Debt for purchase on a pro rata basis unless otherwise required by law or applicable stock exchange or Depository requirements (with such adjustments as may be deemed appropriate by the Company so that only Notes and other First Lien Debt in denominations of $2,000 and integral multiples of $1,000 in excess thereof will be outstanding after such purchase). For the purposes of calculating the principal amount of any such Indebtedness not denominated in U.S. dollars, such Indebtedness shall be calculated by converting any such principal amounts into their Dollar Equivalent determined as of the Business Day immediately prior to the date on which the Asset Sale Offer is announced. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero.
(f) The Issuers Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such those requirements, laws and regulations are applicable in connection with the purchase each repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02the Asset Sale provisions of this Indenture, the Issuers Company shall comply with the applicable securities laws and regulations and shall will not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.10 by virtue of such conflictcompliance.
(g) The provisions of this Section 4.10 with respect to the Company’s obligation to make an Asset Sale Offer as a result of an Asset Sale may be waived or modified at any time with the written consent of the Holders of a majority in aggregate principal amount of the Notes then outstanding.
Appears in 1 contract
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s senior management or, in the case of an Asset Sale in excess of $5.0 million, the Board of Directors of the Company);
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of (x) cash or Cash Equivalents, (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business or (z) Capital Stock in one or more Persons engaged in a Permitted Business that are or thereby become Restricted Subsidiaries of the Company, and, in each case, such consideration is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Securities) that are assumed by the transferee of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations securities received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 180 days after such Asset Sale (to the extent of the cash or Cash Equivalents actually so received, received in the conversion) shall be deemed to be cash for the purposes of this provision only; and
(iviii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either:
(A) to prepay any Designated Non-Senior Debt or Guarantor Senior Debt or any Indebtedness of a Restricted Subsidiary that is not a Guarantor and, in the case of any Senior Debt or Guarantor Senior Debt or Indebtedness of a Restricted Subsidiary that is not a Guarantor under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility (or effect a permanent reduction in availability under such revolving credit facility regardless of the fact that no prepayment is required);
(B) to make an investment (x) in properties and assets that replace the properties and assets that were the subject of such Asset Sale, (y) in properties and assets that will be used by the Company or a Restricted Subsidiary in a Permitted Business or (z) permitted by clause (1) of the definition of Permitted Investments (collectively, “Replacement Assets”); or
(C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Pending the final application of the Net Cash Consideration received Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Indebtedness or otherwise invest such Net Cash Proceeds in any manner not prohibited by this Indenture. On the 361st day after an Asset Sale or such earlier date, if any, as the senior management or the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary in to make an offer to purchase (the Asset Sale having an aggregate Fair Market Value“Net Proceeds Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, taken together with from all other Designated Non-Cash Consideration received pursuant Holders on a pro rata basis, that amount of Securities equal to this clause (d) the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Securities to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, that if the Company so elects or is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in required by the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt terms of any Senior Subordinated Debt, such Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds Offer may be used:
(i) made ratably to permanently repay (A) Debt outstanding under purchase the Credit Agreement (and, in the case Securities and such other Indebtedness of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking Company that ranks pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360Securities. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this Section. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from an one or more Asset Sale for general corporate purposes Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $10.0 million, shall be applied as required pursuant to the end second preceding paragraph). In the event of the 360-day period referred transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the first sentence successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section, and shall comply with the provisions of clause (iii) of this Section 4.09(c).
(d) When with respect to such deemed sale as if it were an Asset Sale. In addition, the aggregate amount fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from Asset Sales not applied for purposes of this Section 4.17. Notice of each Net Proceeds Offer pursuant to (this Section 4.17 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and within materials necessary to enable such Holders to tender Securities pursuant to the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), Net Proceeds Offer and shall state the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal tofollowing terms:
(i) accumulated Excess Proceedsthat Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to prorationing as hereinafter described in the event the Net Proceeds Offer is oversubscribed) in integral multiples of $1,000 of principal amount, multiplied byat the applicable purchase price;
(ii) that the Net Proceeds Offer is being made pursuant to this Section 4.17 and that all Securities tendered will be accepted for payment; provided, however, that if the principal amount of Securities tendered in the Net Proceeds Offer exceeds the aggregate amount of the Net Proceeds Offer Amount, the Company shall select the Securities to be purchased on a fraction pro rata basis (xbased on amounts tendered);
(iii) the numerator purchase price (including the amount of accrued interest, if any) and the purchase date (which is equal shall be no earlier than 30 days nor later than 60 days from the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(iv) that any Security not tendered will continue to accrue interest;
(v) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the outstanding aggregate Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(vi) that Holders electing to have a Security purchased pursuant to the Net Proceeds Offer will be required to surrender the Security, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Offer Payment Date;
(vii) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes Security the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; and
(yviii) the denominator of which is that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers’ Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so to the Holder thereof. For purposes of this Section 4.17, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that only Notes in multiples of $1,000 principal amount (and in a minimum the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect the Securities tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.17, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.17 by virtue thereof. The provisions of such conflictthis Section and other provisions contained in this Indenture relating to the Company’s obligation to make a Net Proceeds Offer may be waived or modified with the written consent of the Holders of a majority in principal amount of the Securities.
Appears in 1 contract
Sources: Indenture (Quality Distribution Inc)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any Restricted Subsidiary to, make any Asset Sale unless the following conditions are met:
(a) the Asset Sale is for at least Fair Market Value; and
(b) at least 75% of the consideration received by the Company or its Restricted Subsidiaries consists of cash or Cash Equivalents; provided that for purposes of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from receives consideration at the purchaser that are promptly, but in any event within 90 days time of such Asset Sale not less than the fair market value of the closing, converted by the Company or assets subject to such Restricted Subsidiary to cash or Cash Equivalents, to the extent Asset Sale; (ii) at least 80% of the consideration for such Asset Sale is in the form of cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value liabilities of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use (other than liabilities that are by their terms subordinated to the Notes or any Net Cash Proceeds from an Subsidiary Guaranty) that are assumed by the transferee of such assets (PROVIDED, that following such Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior there is no further recourse to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).Company or its
(d4) When to the aggregate amount of Net Cash Proceeds from Asset Sales extent not applied pursuant to used as provided in clauses (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”1), the Issuers must(2) or (3), within 30 days, applied to make an offer to purchasepurchase Notes as described below (an "EXCESS PROCEEDS OFFER"); PROVIDED, that the Company shall not be required to make an Excess Proceeds Offer until the amount of Excess Proceeds is greater than $5,000,000. Pending the final application of any such Net Proceeds, the Company may temporarily reduce Indebtedness under the Revolving Credit Facility or temporarily invest such Net Proceeds in accordance Cash Equivalents. Notwithstanding the foregoing, the Company shall not be permitted to directly or indirectly sell, assign, lease, convey or otherwise dispose of the Casino Rouge or any Replacement Vessel (other than in connection with Section 3.02an Event of Loss) unless, Notes within 60 days of such disposition, the Company replaces the Casino Rouge or such Replacement Vessel with a Gaming Vessel having a principal amount equal to:
(i) accumulated Excess Proceedsfair market value, multiplied by
(ii) a fraction (x) the numerator of which is as determined by an independent appraisal, at least equal to the outstanding aggregate principal amount fair market value of the Notes and Casino Rouge or such Replacement Vessel immediately preceding such disposition. Net Proceeds not invested or applied as set forth in the preceding clauses (y1), (2) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. (3) constitute "EXCESS PROCEEDS." If the Offer Company elects, or becomes obligated to Purchase is for less than all of the outstanding Notes and Notes in make an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerExcess Proceeds Offer, the Issuers Company shall offer to purchase Notes having an aggregate principal amount equal to the Excess Proceeds (the "PURCHASE AMOUNT"), at a purchase price equal to 100% of the aggregate principal amount on a pro rata basis thereof, plus accrued and unpaid interest, if any, to the extent practicablepurchase date. The Company must commence such Excess Proceeds Offer not later than 30 days after the expiration of the 270 day period following the Asset Sale that produced such Excess Proceeds. If the aggregate purchase price for the Notes tendered pursuant to the Excess Proceeds Offer is less than the Excess Proceeds, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or its Restricted Subsidiaries may use the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation payment of such purchase price for general corporate purposes. Each Excess Proceeds Offer shall remain open for a period of 20 Business Days and no longer, unless a longer period is required by law (the "EXCESS PROCEEDS OFFER PERIOD"). Promptly after the termination of the Excess Proceeds Offer to Period (the "EXCESS PROCEEDS PAYMENT DATE"), the Company shall purchase and mail or deliver payment for the Purchase Amount for the Notes or portions thereof tendered, PRO RATA or by such other method as may be used for any purpose not otherwise prohibited required by this Indenturelaw, or, if less than the Purchase Amount has been tendered, all Notes tendered pursuant to the Excess Proceeds Offer. The Issuers principal amount of Notes to be purchased pursuant to an Excess Proceeds Offer may be reduced by the principal amount of Notes acquired by the Company through purchase or redemption (other than pursuant to a Change of Control Offer) subsequent to the date of the Asset Sale and surrendered to the Trustee for cancellation. Each Excess Proceeds Offer shall comply be conducted in compliance with the requirements of Rule 14e-1 all applicable laws, including, without limitation, Regulation 14E under the Exchange Act and any all other applicable federal and state securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09laws. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.10, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.10 by virtue thereof. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, create or suffer to exist or become effective any restriction that would impair the ability of the Company to make an Excess Proceeds Offer upon an Asset Sale or, if such conflictExcess Proceeds Offer is made, to pay for the Notes tendered for purchase.
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s Board of Directors);
(b2) at least 75% of the consideration received by the Company or its such Restricted Subsidiaries consists of Subsidiary, as the case may be, from such Asset Sale shall be cash or Cash EquivalentsEquivalents and is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ix) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes notes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a such Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Notes and other than liabilities consisting of law Disqualified Capital Stock) (i) that are assumed by the transferee of any such assets and from which the Company and its Restricted Subsidiaries are unconditionally released or a customary novation agreement,
(ii) Additional Assets,
in respect of which neither the Company nor any Restricted Subsidiary following such sale has any obligation and (iiiy) instruments, notes, securities any notes or other obligations received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any no event within 90 more than 60 days of the closingafter receipt, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents (to the extent of the cash or Cash Equivalents actually so received), shall be deemed to be cash for purposes of this provision; and
(iv3) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either:
(a) to repay any Obligations under (y) the Senior Credit Facilities and/or interest rate protection, currency and other hedging agreements permitted under the Senior Credit Facilities or (z) any Designated Non-other secured Indebtedness (other than (1) Subordinated Obligations, (2) Equal Lien Indebtedness and (3) Indebtedness secured by Liens junior in priority to Equal Lien Indebtedness) and, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility;
(b) to reinvest in Productive Assets (and to the extent such reinvestment constitutes an Investment, such reinvestment complies with Section 4.8); or
(c) a combination of repayment and investment permitted by the foregoing clauses (3)(a) and (3)(b). On the 361st day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Consideration received Proceeds relating to such Asset Sale as set forth in clauses (3)(a), (3)(b) and (3)(c) of the immediately preceding sentence (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (3)(a), (3)(b) and (3)(c) of the immediately preceding sentence (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary to make an offer to purchase for cash (the “Net Proceeds Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, from all Holders and holders of Equal Lien Indebtedness on a pro rata basis, that amount of Notes and Equal Lien Indebtedness (if such Equal Lien Indebtedness provides for such a repurchase offer equal to the Net Proceeds Offer Amount at a price in cash equal to 100% of the principal amount of the Notes and Equal Lien Indebtedness to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, that if at any time any non-cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may be, in connection with any Asset Sale having an aggregate Fair Market Valueis converted into or sold or otherwise disposed of for cash (other than interest, taken together dividends or other earnings received with all other Designated Nonrespect to any such non-Cash Consideration received pursuant cash consideration), then such conversion or disposition shall be deemed to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from constitute an Asset Sale, Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds may thereof shall be used:applied in accordance with this covenant.
(ib) to permanently repay (A) Debt outstanding under Notwithstanding the Credit Agreement (andforegoing, in if a Net Proceeds Offer Amount is less than $30.0 million, the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds constituting such Net Proceeds Offer Amount to a Net Proceeds Offer may be deferred until such time as such Net Proceeds Offer Amount plus the aggregate amount of all Net Proceeds Offer Amounts arising subsequent to the Net Proceeds Offer Trigger Date relating to such initial Net Proceeds Offer Amount from all Asset Sales by the date of such commitment; provided that (x) such investment is consummated within 180 days of Company and its Restricted Subsidiaries aggregates at least $30.0 million, at which time the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) Company or such binding commitment is terminated, the Restricted Subsidiary shall apply all Net Cash Proceeds not constituting all Net Proceeds Offer Amounts that have been so applied will deferred to make a Net Proceeds Offer (the first date the aggregate of all such deferred Net Proceeds Offer Amounts is equal to $30.0 million or more shall be deemed to be Excess a Net Proceeds Offer Trigger Date).
(c) Notwithstanding paragraphs (a) and (b) of this Section 4.12, the Company and its Restricted Subsidiaries will be permitted to consummate an Asset Sale without complying with such paragraphs to the extent that:
(1) at least 75% of the consideration for such Asset Sale constitutes Productive Assets (and to the extent any of such Productive Assets constitutes an Investment, such Investment complies with Section 4.8); and
(2) such Asset Sale is for at least fair market value (as defined belowdetermined in good faith by the Company’s Board of Directors). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, ; provided that any consideration not constituting Productive Assets received by the Company or any of its Restricted Subsidiary may use Subsidiaries in connection with any Asset Sale permitted to be consummated under this paragraph shall constitute Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior and shall be subject to the end of the 360-day period referred to in the first sentence provisions of this Section 4.09(c)covenant with respect to the application of Net Cash Proceeds; provided that at the time of entering into such transaction or immediately after giving effect thereto, no Default or Event of Default shall have occurred or be continuing or would occur as a consequence thereof.
(d) When Within 25 days following the aggregate amount Net Proceeds Offer Trigger Date, the Company shall mail or cause the Trustee to mail (in the Company’s name and at its expense) notice of a Net Cash Proceeds Offer to the Holders of the Notes at their last registered addresses with a copy to the Trustee and the Paying Agent. The Net Proceeds Offer shall remain open from Asset Sales not applied the time of mailing for at least 20 Business Days and until the close of business on the third Business Day prior to the Net Proceeds Offer Payment Date or such longer period as may be required by Law. The notice shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)Net Proceeds Offer. The notice, which shall govern the Issuers mustterms of the Net Proceeds Offer, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal toshall state:
(i) accumulated Excess Proceeds, multiplied bythat the Net Proceeds Offer is being made pursuant to this Section 4.12;
(ii) a fraction the purchase price (xincluding the amount of accrued and unpaid interest, if any) for each Note and the numerator of which is equal Net Proceeds Offer Payment Date;
(iii) that any Note not tendered or accepted for payment will continue to accrue interest in accordance with the terms thereof;
(iv) that any Note accepted for payment pursuant to the outstanding aggregate Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date unless the Company shall fail to make payment therefor;
(v) that Holders electing to have Notes purchased pursuant to a Net Proceeds Offer will be required to surrender their Notes to the Paying Agent at the address specified in the notice prior to 5:00 p.m., New York City time, on the third Business Day immediately preceding the Net Proceeds Offer Payment Date and must complete any form letter of transmittal proposed by the Company and acceptable to the Trustee and the Paying Agent;
(vi) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than 5:00 p.m., New York City time, on the third Business Day immediately preceding the Net Proceeds Offer Payment Date, a telex or facsimile transmission (confirmed by overnight delivery of the original thereof) or letter setting forth the name of the Holder, the principal amount of Notes the Holder delivered for purchase, the Note certificate number (if any) and a statement that such Holder is withdrawing his election to have such Notes and purchased;
(yvii) the denominator of which is equal to the outstanding aggregate principal amount of the that if Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaidand, redeemed or tendered for if applicable, Equal Lien Indebtedness in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate a principal amount in excess of the purchase amount Holders’ pro rata share of the Net Proceeds are tendered and not withdrawn pursuant to the offera Net Proceeds Offer, the Issuers Company shall purchase Notes having an aggregate principal amount equal to the purchase amount and, if applicable, Equal Lien Indebtedness on a pro rata basis to among the extent practicable, Notes and Equal Lien Indebtedness tendered (with such adjustments as may be deemed appropriate by the Company so that only Notes in multiples denominations of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple multiples of $1.00 thereof shall be acquired);
(viii) that Holders whose Notes are purchased only in excess part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered; and
(ix) the instructions that Holders must follow in order to tender their Notes. On or before the Net Proceeds Offer Payment Date, the Company shall (i) accept for payment, on a pro rata basis among the Notes, Notes or portions thereof tendered pursuant to the Net Proceeds Offer, (ii) deposit with respect the Paying Agent money, in immediately available funds, in an amount sufficient to pay the purchase price of all Notes or portions thereof so tendered and accepted and (iii) deliver to the Paying Agent the Notes so accepted together with an Officer’s Certificate setting forth the Notes or portions thereof tendered to and accepted for payment by the Company. The Paying Agent shall promptly mail or deliver to Holders of Notes so accepted payment in an amount equal to the purchase price, and the Trustee shall promptly authenticate and mail or deliver to such Holders a new Note equal in principal amount to any unpurchased portion of the Note surrendered. Any Notes not so accepted shall be promptly mailed or delivered by the Company to the Holder thereof. The Paying Agent shall promptly deliver to the Company the balance of any moneys held by the Paying Agent after payment to the Holders of Notes as aforesaid.
(e) To the extent that the aggregate amount of Notes tendered pursuant to a PIK Note or Net Proceeds Offer is less than the portion of a Global Note constituting PIK Interest)Net Proceeds Offer Amount, the Company may use any remaining Net Proceeds Offer Amount for general corporate purposes. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer to Purchase, Excess Proceeds will Amount shall be reset at zero.
(f) The Company shall comply, and any Excess Proceeds remaining after consummation of to the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply extent applicable, with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other securities laws and or regulations thereunder to (including Rule 14e-1 under the extent such laws and regulations are applicable Exchange Act) in connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.12, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.12 by virtue thereof.
(g) Notwithstanding the foregoing, the Net Proceeds Offer Amount shall be applied first, pro rata, to Series A Notes, Series B Notes and other Equal Lien Indebtedness (other than Series C Notes) that have tendered pursuant to the Net Proceeds Offer, and thereafter the remaining portion of such conflictthe Net Proceeds Offer Amount, if any, shall be applied, pro rata, to Series C Notes that have tendered pursuant to the Net Proceeds Offer.
Appears in 1 contract
Sources: Indenture (Webcraft LLC)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any Restricted Subsidiary to, make any Asset Sale unless (i) the following conditions are met:
Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the Fair Market Value (aas evidenced by a resolution of the Board of Directors set forth in an Officers' Certificate delivered to the Trustee) of the assets or other property sold or disposed of in the Asset Sale is for at least Fair Market Value; and
and (bii) at least 75% of the such consideration received by the Company or its Restricted Subsidiaries consists of either cash or Cash Equivalents; provided provided, however, that for purposes of this clause Section 4.16, "cash" shall include (2), each of the following shall be considered cash or Cash Equivalents:
(ix) the assumption by the purchaser amount of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) any Indebtedness (other than Subordinated Debt or other obligations or liabilities any Indebtedness that is by its terms subordinated in right of payment to the Notes) of the Company or a such Restricted Subsidiary pursuant as shown on the Company's or such Restricted Subsidiary's most recent balance sheet or in the notes thereto that is assumed by the transferee of any such assets or other property in such Asset Sale (and excluding any liabilities that are incurred in connection with or in anticipation of such Asset Sale), but only to operation the extent that such assumption is effected on a basis such that there is no further recourse to the Company or any of law or a customary novation agreement,
the Restricted Subsidiaries with respect to such liabilities and (iiy) Additional Assets,
(iii) instruments, any notes, obligations or securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event converted within 90 60 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received, and).
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(cb) Within 360 365 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Company may elect to apply the Net Cash Proceeds may be used:
from such Asset Sale to (ia) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Senior Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to and/or (b) make an acquisition referred to investment in, or acquire assets and properties that will be used in, the business of the Company and the Restricted Subsidiaries existing on the Issue Date or in clause (ii) or (iii) above shall be treated as a permitted businesses reasonably related thereto. Pending the final application of the any such Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09Proceeds, the Company or any Restricted Subsidiary may use temporarily reduce Indebtedness of the Company under any New Credit Facility or temporarily invest such Net Cash Proceeds in any Investments described under clauses (i) through (iii) of the definition of Permitted Investments. Any Net Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to not applied or invested as provided in the first sentence of this Section 4.09(c)4.16(b) within 365 days of such Asset Sale will be deemed to constitute "Excess Proceeds."
(dc) When Each date that the aggregate amount of Net Cash Excess Proceeds from in respect of which an Asset Sales Sale Offer (as defined below) has not applied been made exceeds $5.0 million shall be deemed an "Asset Sale Offer Trigger Date." As soon as practicable, but in no event later than 20 business days after each Asset Sale Offer Trigger Date, the Company shall commence an offer (an "Asset Sale Offer") to purchase the maximum principal amount of Notes that may be purchased out of the Excess Proceeds. Any Notes to be purchased pursuant to (and within an Asset Sale Offer shall be purchased pro rata based on the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes outstanding, and (y) the denominator of which is all Notes shall be purchased at an offer price in cash in an amount equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof, plus accrued interest toand unpaid interest, but excluding if any, to the date of purchase. If To the Offer to Purchase extent that any Excess Proceeds remain after completion of an Asset Sale Offer, the Company may use the remaining amount for general corporate purposes otherwise permitted by this Indenture. In the event that the Company is for less than all prohibited under the terms of any agreement governing outstanding Senior Debt of the Company from repurchasing Notes with Excess Proceeds pursuant to an Asset Sale Offer as set forth in the first sentence of this Section 4.16(c), the Company shall promptly use all Excess Proceeds to permanently reduce such outstanding Senior Debt of the Company. Upon the consummation of any Asset Sale Offer, the amount of Excess Proceeds shall be deemed to be reset to zero.
(d) Notice of an Asset Sale Offer shall be mailed, by first-class mail (with a copy to the Trustee), by the Company not later than the 20th business day after the related Asset Sale Offer Trigger Date to each holder of Notes at such holder's registered address, stating: (i) that an Asset Sale Offer Trigger Date has occurred and that the Company is offering to purchase the maximum principal amount of Notes that may be purchased out of the Excess Proceeds (to the extent provided in the immediately preceding paragraph), at an offer price in cash in an aggregate amount equal to 100% of the principal amount in excess thereof, plus accrued and unpaid interest, if any, to the date of the purchase (the "Asset Sale Offer Purchase Date"), which shall be a business day, specified in such notice, that is not earlier than 30 days or later than 60 days from the date such notice is mailed, (ii) the amount are of accrued and unpaid interest, if any, as of the Asset Sale Offer Purchase Date, (iii) that any Note not tendered and not withdrawn will continue to accrue interest, (iv) that, unless the Company defaults in the payment of the purchase price for the Notes payable pursuant to the offerAsset Sale Offer, any Notes accepted for payment pursuant to the Asset Sale Offer shall cease to accrue interest after the Asset Sale Offer Purchase Date, (v) that Holders electing to have a Note purchased pursuant to a Asset Sale Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day prior to the Asset Sale Offer Purchase Date, (vi) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Asset Sale Offer Purchase Date, a facsimile transmission or letter setting forth the name of the Holder, the Issuers shall principal amount of the Notes the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased, (vii) that Holders whose Notes having an aggregate are purchased only in part will be issued new Notes in a principal amount equal to the unpurchased portion of the Notes surrendered; provided, however, that each Note purchased and each new Note issued shall be in an original principal amount of $1,000 or integral multiples thereof (or if the Notes purchased were issued in lesser denominations, such lesser denomination), and (viii) such other information as may be required by applicable laws and regulations.
(e) On the Asset Sale Offer Purchase Date, the Company will (i) accept for payment the maximum principal amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer that can be purchased out of Excess Proceeds from such Asset Sale that are to be applied to an Asset Sale Offer, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the aggregate purchase amount price of all Notes or portions thereof accepted for payment, and (iii) deliver or cause to be delivered to the Trustee all Notes tendered pursuant to the Asset Sale Offer. If less than all Notes tendered pursuant to the Asset Sale Offer are accepted for payment by the Company for any reason consistent with this Indenture, selection of the Notes to be purchased by the Company shall be in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not so listed, on a pro rata basis to the extent practicableor by lot; provided, with adjustments by the Company so however, that Notes accepted for payment in part shall only Notes be purchased in integral multiples of $1,000 1,000. The Paying Agent shall promptly mail to each holder of Notes or portions thereof accepted for payment an amount equal to the purchase price for such Notes plus accrued and unpaid interest, if any, thereon, and the Trustee shall promptly authenticate and mail to such holder of Notes accepted for payment in part a new Note equal in principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and to any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the unpurchased portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zeroNotes, and any Excess Proceeds remaining Note not accepted for payment in whole or in part shall be promptly returned to the holder of such Note. On and after consummation an Asset Sale Offer Purchase Date, interest will cease to accrue on the Notes or portions thereof accepted for payment, unless the Company defaults in the payment of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenturepurchase price therefor. The Issuers shall Company will publicly announce the results of the Asset Sale Offer on or as soon as practicable after the Asset Sale Offer Purchase Date.
(f) This Section 4.16 will not apply to a transaction consummated in compliance with Article Five.
(g) The Company will comply with the applicable tender offer rules, including the requirements of Section 14(e) and Rule 14e-1 under the Exchange Act Act, and any all other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations in connection with any Asset Sale Offer and shall not will be deemed not to have breached their obligations be in violation of any of the covenants under this Section 4.09 or Section 3.02 by virtue of Indenture to the extent such conflictcompliance is in conflict with such covenants.
Appears in 1 contract
Sources: Indenture (Hawk Brake Inc)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company's Board of Directors);
(bii) at least 75% of the consideration received by the Company or its such Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash EquivalentsEquivalents and is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ix) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) sheet), of the Company or a any Restricted Subsidiary pursuant (other than (I) contingent liabilities (except to operation the extent reflected (or reserved for) on a balance sheet of law the Company or a customary novation agreement,
any Restricted Subsidiary as of the date prior to the date of consummation of such transaction) and (iiII) Additional Assets,
liabilities that are by their terms subordinated to the Notes or the Guarantees) that are assumed by the transferee of any such assets and (iiiy) instrumentsany securities, notes, securities notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event converted within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the into cash or Cash Equivalents actually (to the extent so received), shall be deemed to be cash or Cash Equivalents for purposes of this provision; and
(iviii) any Designated Non-Cash Consideration received by upon the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value consummation of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds may be used:
(i) relating to permanently repay such Asset Sale within 180 days of receipt thereof either (A) Debt outstanding under the Credit Agreement (to prepay any Senior Indebtedness and, in the case of any Senior Indebtedness under any Credit Facility, effect a permanent reduction in the repayment of the revolving credit facility availability under the such Credit AgreementFacility, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures an investment in properties and assets (other than cash, Cash Equivalents or inventory) that replace the properties and assets that were the subject of such Asset Sale or in properties and assets that will be used in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”"Replacement Assets"), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.------------------
Appears in 1 contract
Sources: Indenture (Everest One Ipa Inc)
Limitation on Asset Sales. The Neither the Parent nor the Company shall notshall, and they shall not permit any of the Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a) the Parent or the Company (or such Restricted Subsidiary, as the case may be) receives consideration at the time of the Asset Sale at least equal to the Fair Market Value (as determined at the time of contractually agreeing to such Asset Sale) of the assets or Capital Stock issued or sold or otherwise disposed of; provided that, with respect to a disposition of any Key Collateral, if holders of Exit Notes exercise their appraisal right pursuant to Section 4.22(a) of the Exit Notes Indenture, the value determined by such appraisal shall govern for purposes hereof; provided, further, that this clause (a) shall not apply to any foreclosures, condemnation, expropriation, forced dispositions, eminent domain or any similar action (whether by deed of condemnation or otherwise);
(b) such Asset Sale is for at least Fair Market Valuemade as part of a bona fide arm’s length transaction with a third party; and
(bc) at least 75% of the consideration received in the Asset Sale, by the Parent, the Company or its such Restricted Subsidiaries consists Subsidiary is in the form of cash or Cash Equivalents; provided that for , to be cumulatively tested among all Asset Sales occurring since the Issue Date. For purposes of this clause (2)c) above, each the amount of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Parent’s, the Company’s or the applicable Restricted Subsidiary’s most recent balance sheet or in the footnotes notes thereto) of the Parent, the Company or any Restricted Subsidiary (other than Subordinated Debt liabilities that are by their terms subordinated to the Notes or the Note Guarantees) that are assumed by the transferee of any such assets or are terminated, canceled or otherwise cease to be obligations of the Parent or the Company in connection with such Asset Sale and, in each case from which the Parent, the Company and all Restricted Subsidiaries have been validly released by all creditors in writing, (ii) any securities or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations assets received by the Parent, the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Parent, the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash received) within 180 days following the closing of such Asset Sale and (iii) any asset described in clause (b) below shall be deemed to be cash for purposes of this Section 4.22. Within 365 days after the receipt of any net proceeds from an Asset Sale (other than an Asset Sale of Key Collateral), the Parent or Cash Equivalents actually so receivedthe Company (or, andif applicable, the Restricted Subsidiary) may apply those net proceeds at its option in one or more of the following manners:
(iva) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all to reduce Indebtedness (other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in valuethan Subordinated Indebtedness);
(b) (x) to make capital expenditures or (y) to purchase or make an Investment otherwise permitted under this Indenture in (A) any one or more businesses; provided that such Investment in any business is in the form of the acquisition of Capital Stock and it results in the Parent, the Company or a Restricted Subsidiary owning an amount of the Capital Stock of such business such that such business constitutes a Restricted Subsidiary, (B) properties, or (C) any other assets that, in each of (A), (B) and (C), replace the businesses, properties and assets that are the subject of such Asset Sale; provided that if, during such 365-day period, the Parent, the Company or a Restricted Subsidiary enters into a definitive binding agreement committing it to apply such net proceeds in accordance with the requirements of clause (x) or (y) of this paragraph after such 365th day, such 365-day period will be extended with respect to the amount of net proceeds so committed for a period not to exceed 180 days until such net proceeds are required to be applied in accordance with such agreement (or, if earlier, until termination of such agreement); and/or
(c) Within 360 any combination of the foregoing. Solely with respect to an Asset Sale of Key Collateral, within forty-five (45) days after the receipt of any Net Cash Proceeds from an such Asset Sale, the Parent or the Company (or, if applicable, the Restricted Subsidiary) shall apply those Net Cash Proceeds may be used:
(i) in their entirety to permanently repay (A) Debt outstanding redeem Exit Notes (or any Permitted Refinancing Indebtedness in respect thereof) and/or (B) reduce Obligations under the Credit Agreement (and, Notes in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or this clause (B), at their option (i) the by redeeming Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
as provided under Section 3.01, or (ii) to acquire Additional Assets; or
by making an offer (iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09the procedures set forth herein for an Asset Sale Offer) to all holders of the Notes to purchase their Notes at a purchase price equal to 100% of the principal amount thereof, plus the amount of accrued but unpaid interest. Pending the final application of any net proceeds, the Parent, the Company or any the applicable Restricted Subsidiary may use any Net Cash Proceeds temporarily reduce revolving credit borrowings or otherwise invest the net proceeds from an Asset Sale for general corporate purposes (including a reduction other than an Asset Sale of Key Collateral) in borrowings under any revolving credit facilitymanner that is not prohibited by this Indenture. Any net proceeds from an Asset Sale (other than an Asset Sale of Key Collateral) prior to not applied or invested in accordance with the end of preceding two paragraphs within the 360-day period referred to in the first sentence of this Section 4.09(c)time periods set forth above shall constitute “Excess Proceeds.
(d) ” When the aggregate amount of Net Cash Excess Proceeds from exceeds U.S.$20,000,000, the Parent, the Company or the applicable Restricted Subsidiary will make an offer (an “Asset Sales Sale Offer”) to prepay or repurchase an aggregate principal amount of Notes equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to (but not applied including) the date of purchase, and will be payable in cash; provided that (A) if at the time that any such Asset Sale Offer would be required, the Issuer is required to prepay or offer to repurchase any First Lien Obligations (which were permitted to be incurred pursuant to Section 4.08 and Section 4.21) pursuant to the terms of the documentation governing such First Lien Obligations with the Excess Proceeds of such Asset Sale (such First Lien Obligations required to be prepaid or offered to be so repurchased, “Priority Applicable Indebtedness”), then the Issuer may first (and within prior to making any Asset Sale Offer as required by this Section 4.22) apply such Excess Proceeds to the time frame set forth in) Section 4.09(c) exceeds $25.0 million payment or purchase of the Priority Applicable Indebtedness as required by the relevant governing documentation up to the amount of such Excess Proceeds required to be applied to the Priority Applicable Indebtedness pursuant to the terms thereof, and the remaining amount (as a result of such prepayment or purchase being declined by holders of Exit Notes (such declined proceeds, the “Excess Declined Asset Sale Proceeds”)), if any, of such Excess Proceeds shall be allocated to the offer to repurchase the Notes and/or Other Applicable Indebtedness pursuant to this Section 4.22 and (B) if at the time that any such offer to repurchase would be required, the Issuers must, within 30 days, make an Issuer is required to prepay or offer to purchaserepurchase any Indebtedness that is secured by Liens on the Collateral on a pari passu basis with the Obligations (which Indebtedness is permitted to be incurred pursuant to Section 4.08 and Section 4.21) pursuant to the terms of the documentation governing such Indebtedness with the Excess Proceeds of such Asset Sale (such Indebtedness required to be prepaid or offered to be so repurchased, “Other Applicable Indebtedness”), then the Issuer may apply such Excess Proceeds on a pro rata basis (determined on the basis of the aggregate outstanding principal amount of the Notes and Other Applicable Indebtedness at such time); provided, further, that the portion of such Excess Proceeds allocated to any Priority Applicable Indebtedness and Other Applicable Indebtedness shall not exceed the amount of such Excess Proceeds required to be allocated to the Priority Applicable Indebtedness and Other Applicable Indebtedness pursuant to the terms thereof, and the remaining amount, if any, of such Excess Proceeds shall be allocated to the offer to repurchase additional Notes pursuant to this Section 4.22 and to the repurchase or prepayment of any Other Applicable Indebtedness (ratably between the Notes and any such Other Applicable Indebtedness on the basis of the aggregate outstanding principal amount of the Notes and such Other Applicable Indebtedness at such time). If any Excess Proceeds remain after consummation of an Asset Sale Offer and any other offers made pursuant to the immediately preceding paragraph in respect of Priority Applicable Indebtedness and Other Applicable Indebtedness, the Parent, the Company or the applicable Restricted Subsidiary may use those Excess Proceeds for any purpose not otherwise prohibited by this Indenture and the Intercreditor Agreements. If the aggregate principal amount of Notes tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds required to purchase Notes above, the Notes to be purchased will be selected on a pro rata basis and in accordance with Section 3.02DTC procedures, Notes having a as applicable. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds hereunder will be reset at zero. To the extent Excess Proceeds exceed the outstanding aggregate principal amount equal to:
(i) accumulated Excess Proceedsof the Notes, multiplied by
(ii) a fraction (x) the numerator of which is equal Company need only make an Asset Sale Offer up to the outstanding aggregate principal amount of Notes, and any additional Excess Proceeds will not be subject to this Section 4.22 and will be permitted to be used for any purpose otherwise permitted hereunder in the Company’s discretion. The Company may, at its option, satisfy the foregoing obligations with respect to any net proceeds from an Asset Sale (other than an Asset Sale of Key Collateral) by making an Asset Sale Offer with respect to such net proceeds prior to the date required by this Indenture with respect to all or a part of the net proceeds. Such Asset Sale Offer may be made at the same time as consents are solicited with respect to an amendment, supplement or waiver of this Indenture, Notes and/or Note Guarantees. The provisions under this Indenture relative to the Company’s obligations to make an offer to repurchase the Notes and (y) as a result of an Asset Sale may be waived or modified with the denominator written consent of which is equal the Required Holders. If the Parent, the Company or the applicable Restricted Subsidiary purchases 85% or more of the then outstanding Notes pursuant to an Asset Sale Offer under this Section 4.22, the Company may redeem the remaining outstanding aggregate principal amount Notes after the completion of the purchase of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset SaleSale Offer, rounded down at a price equal to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued and unpaid interest up to, but excluding not including the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn , pursuant to the offerprovisions of Article 3. The Parent, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds applicable Restricted Subsidiary will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such those laws and regulations are applicable in connection with the purchase each repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with this Section 4.09 or Section 3.024.22, the Issuers shall Parent, the Company or the applicable Restricted Subsidiary will comply with the applicable securities laws and regulations and shall will not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.22 by virtue of such conflict.
Appears in 1 contract
Sources: Indenture (GAC Inc.)
Limitation on Asset Sales. The Company shall not, and shall not permit any Restricted Subsidiary to, make consummate any Asset Sale unless the following conditions are met:
(ai) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of each such Asset Sale is for at least Fair Market Valueequal to the fair market value (as determined by the Board of Directors of the Company in good faith) of the assets sold; and
(bii) at least 75not less than 80% (100% in the case of lease payments) of the consideration received by the Company (or its such Restricted Subsidiaries consists Subsidiary, as the case may be) is in the form of cash or Cash Equivalents; cash, provided that any note or other obligation received by the Company (or such Restricted Subsidiary, as the case may be) that is converted into cash within 30 days after receipt shall be deemed to be cash for purposes of this clause (2ii), each of the following shall be considered cash or Cash Equivalents:
; and (iiii) the assumption by the purchaser Company within 365 days of Debt such Asset Sale (x) reinvests or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or causes a Restricted Subsidiary pursuant to operation reinvest (including by way of law or a customary novation agreement,
(iiacquisitions) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may of any Asset Sale into one or more of the then existing businesses of the Company and its Subsidiaries; or (y) applies or causes to be used:
applied such Net Cash Proceeds to the permanent reduction of outstanding Senior Indebtedness (i) to permanently repay (A) Debt outstanding under the Credit Agreement (andor, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior , to the end of the 360-day period referred to permanent reduction in the first sentence of this Section 4.09(ccommitments thereunder).
; or (dz) When after such time as the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess ProceedsNet Proceeds equal or exceed $5 million, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required applies or causes to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal applied such Excess Net Proceeds to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only of Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.tendered
Appears in 1 contract
Sources: Indenture (Tracor Inc /De)
Limitation on Asset Sales. (a) The Company shall not, and shall not cause or permit any of its Restricted Subsidiary Subsidiaries to, make any complete an Asset Sale unless the following conditions are metunless:
(a1) the Asset Sale is for Company or such applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least equal to the Fair Market Value; andValue of the assets sold or otherwise disposed of;
(b2) at least not less than 75% of the consideration received by the Company or its such applicable Restricted Subsidiaries consists Subsidiary, as the case may be, is in the form of (A) cash or Cash Equivalents; provided that for purposes , or (B) Replacement Assets, and in each case set forth in subclauses (A) and (B) of this clause (2a)(2), each is received at the time of such sale or other disposition; provided that the following shall be considered cash or Cash Equivalents:
amount of (i) the assumption by the purchaser of any Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the NotesDebt) of the Company or a any such applicable Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
that is actually assumed by the transferee in such Asset Sale and from which the Company and its Restricted Subsidiaries are fully and unconditionally released and (ii) Additional Assets,
(iii) instruments, notes, any securities or other obligations received by the Company or any such applicable Restricted Subsidiary from the purchaser that which are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents within ten Business Days of such Asset Sale (to the extent of the cash or Cash Equivalents actually so received), will be deemed to be cash for purposes of this clause(a)(2) and to have been received at the time of such sale; and
(iv3) any Designated Non-Cash Consideration the Asset Sale Proceeds received by the Company or such Restricted Subsidiary in Subsidiary, as the Asset Sale having an aggregate Fair Market Valuecase may be, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstandingare applied, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after option of the receipt of any Net Cash Proceeds from an Asset SaleCompany or such Restricted Subsidiary, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding to prepay, repay or purchase indebtedness under the Credit Agreement (and, in the case Facilities or any other secured Debt of the repayment of Company or such Restricted Subsidiary or the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) Other Senior Notes; or (B) to an investment in properties and assets that are used or are useful in the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business business of the Company or one its Restricted Subsidiaries or more Restricted Subsidiaries; provided that a binding commitment in businesses reasonably similar to make an acquisition referred or ancillary to in clause (ii) or (iii) above shall be treated as a permitted application the business of the Net Cash Proceeds from Company or its Restricted Subsidiaries as conducted at the date time of such commitmentAsset Sale; provided that (xi) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and occurs or (yii) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any such Restricted Subsidiary may use any Net Cash Proceeds from an enters into contractual commitments to so apply such Asset Sale for general corporate purposes Proceeds, subject only to customary conditions (including a reduction other than the obtaining of financing), in borrowings under any revolving credit facility) prior each case, within 365 days following the receipt of such Asset Sale Proceeds. If on such 365th day the Available Asset Sale Proceeds exceed $15,000,000, the Company shall apply an amount equal to the end of the 360-day period referred Available Asset Sale Proceeds to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchaserepurchase the Notes (and, at its option, to an offer to repurchase other equal and ratable Debt), at a purchase price in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is cash equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof plus accrued interest toand unpaid interest, but excluding if any, to the purchase date (an "Excess Proceeds Offer"). If an Excess Proceeds Offer is not fully subscribed, the Company may retain and use for general corporate purposes the portion (any such portion, a "Deficiency") of the Available Asset Sale Proceeds not required to repurchase Notes. Upon completion of any Excess Proceeds Offer, the amount of Available Asset Sale Proceeds shall be reset to zero.
(b) If the Company is required to make an Excess Proceeds Offer, the Company shall (1) notify the Trustee thereof at least five Business Days prior to the commencement of the Excess Proceeds Offer and (2) send by first-class mail, postage prepaid, within 30 days of the 365th day following the receipt of the Available Asset Sale Proceeds exceeding $15,000,000 as specified in Section 10.10(a)(3), a notice to the Trustee and to each Holder, at the address appearing in the register maintained by the Security Registrar, stating the information set forth below. The Excess Proceeds Offer shall remain open for a period of 20 Business Days following its commencement (the "Offer Period"). The notice, which shall govern the terms of the Excess Proceeds Offer, shall state:
(A) that the Company is offering to apply the Available Asset Sale Proceeds, to repurchase such Notes at a purchase price in cash equal to 100% of the principal amount of the Notes, plus accrued and unpaid interest, if any, to the purchase date;
(B) that the Excess Proceeds Offer is being made pursuant to this Section 10.10 and the length of time the Excess Proceeds Offer will remain open;
(C) the purchase price and the purchase date (which shall be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is mailed);
(D) that any Note not tendered or accepted for payment will continue to accrue interest;
(E) that, unless the Company defaults in a payment pursuant to the Excess Proceeds Offer, any Notes accepted for payment pursuant to the Excess Proceeds Offer shall cease to accrue interest after the expiration of purchase. If the Offer Period;
(F) that Holders accepting the offer to Purchase is for less than all have a Note purchased pursuant to any Excess Proceeds Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the outstanding Notes Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Business Day preceding the purchase date; 103
(G) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the expiration of the Offer Period, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and Notes in an a statement that such Holder is withdrawing his election to have such Note purchased;
(H) that, if the aggregate principal amount in excess of Notes surrendered by Holders exceeds the purchase amount are tendered and not withdrawn pursuant to the offerAvailable Asset Sale Proceeds, the Issuers Company or the Trustee shall purchase select the Notes having an aggregate principal amount equal to the purchase amount be purchased on a pro rata basis to the extent practicable, (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of US$1,000, or integral multiples of $1,000 US$1,000, shall be purchased);
(I) that Holders whose Notes are being purchased only in part will be issued new Notes equal in aggregate principal amount (to the unpurchased portion of the Notes surrendered; provided that each Note purchased and each such new Note issued shall be in a minimum an original principal amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 US$1,000 and any integral multiple multiples of $1.00 US$1,000; and
(J) the calculations used in excess thereof with respect determining the amount of Available Asset Sale Proceeds to a PIK Note or be applied to the portion purchase of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenturesuch Notes. The Issuers Company shall comply with the requirements of Rule 14e-1 14e-l under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes pursuant to in connection with an Offer to Purchase pursuant to this Section 4.09Excess Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with this Section 4.09 or Section 3.0210.10, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 10.10 by virtue of such conflictthereof.
Appears in 1 contract
Sources: Indenture (Norske Skog Canada LTD)
Limitation on Asset Sales. (a) The Company shall will not, and shall will not cause or permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Asset Sale is for Company or such applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least equal to the Fair Market ValueValue of the assets sold or otherwise disposed of; and
(bii) at least 75not less than 80% of the consideration received by the Company or its such applicable Restricted Subsidiaries consists Subsidiary, as the case may be, is in the form of (A) cash or Cash Equivalents; provided that for purposes , or (B) Replacement Assets, and in each case set forth in subclauses (A) and (B) of this clause (2a)(ii), each is received at the time of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt such sale or other obligations or liabilities disposition; provided that the amount of (as shown on the Company’s most recent balance sheet or in the footnotes thereto1) any Debt (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the NotesDebt) of the Company or a any such applicable Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
that is actually assumed by the transferee in such Asset Sale and from which the Company and its Restricted Subsidiaries are fully and unconditionally released and (ii2) Additional Assets,
(iii) instruments, notes, any securities or other obligations received by the Company or any such applicable Restricted Subsidiary from the purchaser that which are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents within ten Business Days of such Asset Sale (to the extent of the cash or Cash Equivalents actually so received), and
will be deemed to be cash for purposes of this clause (iva)(ii); and (iii) any Designated Non-Cash Consideration the Asset Sale Proceeds received by the Company or such Restricted Subsidiary in Subsidiary, as the Asset Sale having an aggregate Fair Market Valuecase may be, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstandingare applied, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after option of the receipt of any Net Cash Proceeds from an Asset SaleCompany or such Restricted Subsidiary, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding to prepay, repay or purchase indebtedness under the Credit Agreement (and, in the case Facilities or any other secured Debt of the repayment of Company or such Restricted Subsidiary or the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) Other Senior Notes; or (B) to an investment in properties and assets that are used or are useful in the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business business of the Company or one its Restricted Subsidiaries or more Restricted Subsidiaries; provided that a binding commitment in businesses reasonably similar to make an acquisition referred or ancillary to in clause (ii) or (iii) above shall be treated as a permitted application the business of the Net Cash Proceeds from Company or its Restricted Subsidiaries as conducted at the date time of such commitmentAsset Sale; provided that (x1) such investment is consummated occurs or (2) the Company or any such Restricted Subsidiary enters into contractual commitments to so apply such Asset Sale Proceeds, subject only to customary conditions (other than the obtaining of financing), in each case, within 180 365 days following the receipt of such Asset Sale Proceeds; or (C) if on such 365th day the Available Asset Sale Proceeds exceed $15,000,000, the Company shall apply an amount equal to the Available Asset Sale Proceeds to an offer to repurchase the Notes (and, at its option, to an offer to repurchase other equal and ratable Debt), at a purchase price in cash equal to 100% of the end principal amount thereof plus accrued and unpaid interest, if any, to the purchase date (an "Excess Proceeds Offer"). If an Excess Proceeds Offer is not fully subscribed, the Company may retain and use for general corporate purposes the portion (any such portion, a "Deficiency") of the 360-day period referred Available Asset Sale Proceeds not required to in the first sentence repurchase Notes. Upon completion of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminatedany Excess Proceeds Offer, the Net Cash amount of Available Asset Sale Proceeds not so applied will shall be deemed reset to be Excess zero; provided that the amount of the 25% Available Asset Sale Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an ) shall constitute Available Asset Sale Proceeds for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in first Excess Proceeds Offer that is made after August 14, 2006 (the first sentence of this Section 4.09(c"Asset Sale Proceeds Measurement Date").
(db) When Even if the aggregate amount of Net Cash Proceeds from Company completes an Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchaseSale, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) no event shall the numerator Company use or be required to use Available Asset Sale Proceeds to purchase more than 25% of which is equal to the outstanding original aggregate principal amount of the Notes and (y) the denominator of which is equal on or prior to the outstanding Asset Sale Proceeds Measurement Date. If the aggregate Available Asset Sale Proceeds (disregarding any resetting to zero as described in paragraph (a) above) resulting from Asset Sales occurring on or prior to the Asset Sale Proceeds Measurement Date, less any Deficiencies resulting from any Excess Proceeds Offers made by the Company on or prior to such date, exceed 25% of the original aggregate principal amount of the Notes and all Debt secured by Liens on (such excess being the Collateral ranking pari passu "25% Available Asset Sale Proceeds"), then the Company shall make an Excess Proceeds Offer in accordance with the Liens on foregoing provisions (i) promptly after the Collateral securing Asset Sale Proceeds Measurement Date, in the Notes similarly event the amount of the 25% Available Asset Sale Proceeds exceeds $15,000,000 or (ii) at such time as the amount of the 25% Available Asset Sale Proceeds together with Available Asset Sale Proceeds realized after the Asset Sale Proceeds Measurement Date exceeds $15,000,000, in the event the amount of the 25% Available Asset Sale Proceeds is less than $15,000,000.
(c) If the Company is required to be repaidmake an Excess Proceeds Offer, redeemed or tendered for in connection with the Asset Sale, rounded down Company shall (i) notify the Trustee thereof at least five Business Days prior to the nearest $1,000commencement of the Excess Proceeds Offer and (ii) send by first-class mail, postage prepaid, within 30 days following the date specified in clause (a)(iii)(C) of this Section 4.10, a notice to the Trustee and to each Holder, at the address appearing in the register maintained by the Registrar, stating the information set forth below. The Excess Proceeds Offer shall remain open for a period of 20 Business Days following its commencement (the "Offer Period"). The notice, which shall govern the terms of the Excess Proceeds Offer, shall state:
(1) that such Holders have the right to require the Company to apply the Available Asset Sale Proceeds, subject to the limitations under Section 4.10(b) hereof, to repurchase such Notes at a purchase price for the Notes will be in cash equal to 100% of the principal amount of the Notes, plus accrued interest toand unpaid interest, but excluding if any, to the purchase date;
(2) that the Excess Proceeds Offer is being made pursuant to this Section 4.10 and the length of time the Excess Proceeds Offer will remain open;
(3) the purchase price and the purchase date (which shall be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is mailed);
(4) that any Note not tendered or accepted for payment will continue to accrue interest;
(5) that, unless the Company defaults in a payment pursuant to the Excess Proceeds Offer, any Notes accepted for payment pursuant to the Excess Proceeds Offer shall cease to accrue interest after the expiration of purchase. If the Offer Period;
(6) that Holders electing to Purchase is for less than all have a Note purchased pursuant to any Excess Proceeds Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the outstanding Notes Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Business Day preceding the purchase date;
(7) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the expiration of the Offer Period, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and Notes in an a statement that such Holder is withdrawing his election to have such Note purchased;
(8) that, if the aggregate principal amount in excess of Notes surrendered by Holders exceeds the purchase amount are tendered and not withdrawn pursuant to the offerAvailable Asset Sale Proceeds, the Issuers Company or the Trustee shall purchase select the Notes having an aggregate principal amount equal to the purchase amount be purchased on a pro rata basis to the extent practicable, (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of US$1,000, or integral multiples of $1,000 US$1,000, shall be purchased);
(9) that Holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount (to the unpurchased portion of the Notes surrendered; provided that each Note purchased and each such new Note issued shall be in a minimum an original principal amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 US$1,000 and any integral multiple multiples of $1.00 US$1,000; and
(10) the calculations used in excess thereof with respect determining the amount of Available Asset Sale Proceeds to a PIK Note or be applied to the portion purchase of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenturesuch Notes. The Issuers Company shall comply with the requirements of 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 connection with the purchase repurchase of the Notes pursuant to in connection with an Offer to Purchase pursuant to this Section 4.09Excess Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with this Section 4.09 or Section 3.024.10, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.10 by virtue of such conflictthereof.
Appears in 1 contract
Sources: Indenture (Norske Skog Canada LTD)
Limitation on Asset Sales. The Company shall will not, and shall will not permit any Restricted Subsidiary to, make any Asset Sale unless the following conditions are met:
(ai) the Asset Sale is for Company or the Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least equal to the Fair Market Value; and
Value of the assets sold or disposed of as determined by the good-faith judgment of the Board of Directors, which determination, in each case where such fair market value is greater than $5.0 million, shall be evidenced by a Board Resolution and (bii) at least 75% of the consideration received by the Company for such sale or its Restricted Subsidiaries other disposition consists of cash or Cash Equivalents; provided that for purposes of this clause (2), each of the following shall be considered cash equivalents or Cash Equivalents:
(i) the assumption by of unsubordinated Indebtedness. The Company shall, or shall cause the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a relevant Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instrumentsto, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the date of receipt of any the Net Cash Proceeds from an Asset Sale, the (i) (A) apply an amount equal to such Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under unsubordinated Indebtedness of the Credit Agreement (andCompany or Indebtedness of any Restricted Subsidiary, in each case owing to a Person other than the case Company or any of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) its Restricted Subsidiaries or (B) invest an equal amount, or the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes amount not so applied pursuant to clause (if anyA) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in long-term property or assets of a nature or type or that are used in a Permitted Business business (or in a company having property and assets of a nature or type, or engaged in a business) similar or related to the nature or type of the property and assets of, or the business of, the Company or one or more and its Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from Subsidiaries existing on the date of such commitment; provided that investment (xas determined in good faith by the Board of Directors, whose determination shall be conclusive and evidenced by a Board Resolution) such investment is consummated within 180 days of and (ii) apply (no later than the end of the 360-day period referred to above) such excess Net Cash Proceeds (to the extent not applied pursuant to clause (i)) as provided in the first sentence following paragraphs of this paragraph and Section 1017. The amount of such Net Cash Proceeds required to be applied (yor to be committed to be applied) if during such acquisition is not consummated within 360-day period in the period manner as set forth in clause (xi) or of the preceding sentence and not applied as so required by the end of such binding commitment is terminatedperiod shall constitute "Excess Proceeds." If, as of the first day of any calendar month, the Net Cash aggregate amount of Excess Proceeds not so applied will be deemed theretofore subject to be an Excess Proceeds Offer (as defined below). For ) totals at least $10.0 million, the avoidance Company must, not later than the 30th Business Day thereafter, (i) use such Excess Proceeds to make an offer to purchase the 11-3/4% Senior Notes due 2004 of doubt, pending application thereof the Company in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash terms of such Indebtedness which require such a purchase offer and do not provide for proration of the amount of such Indebtedness to be purchased with such Exceeds Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facilitythe "1997 Senior Notes Offer") prior and (ii) to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash extent Excess Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 daysremain after such offer is consummated, make an offer (an "Excess Proceeds Offer") to purchase, in accordance with Section 3.02, Notes having purchase from the Holders on a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding pro rata basis an aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount Proportionate Share of the Notes and all Debt secured by Liens Excess Proceeds on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down such date remaining after application pursuant to the nearest $1,000. The 1997 Senior Notes Offer, at a purchase price for the Notes will be equal to 100% of the principal amount plus of the Notes, plus, in each case, accrued and unpaid interest to, but excluding to the date of purchasepurchase (the "Excess Proceeds Payment"). If The Company shall 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 Purchase this Section 1017 and that all Notes validly tendered will be accepted for payment on a pro rata basis;
(ii) the purchase price and the date of purchase (which shall be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is for less than all mailed) (the "Excess Proceeds Payment Date");
(iii) that any Note not tendered will continue to accrue interest pursuant to its terms;
(iv) that, unless the Company defaults in the payment of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn Excess Proceeds Payment, any Note accepted for payment pursuant to the offerExcess Proceeds Offer shall cease to accrue interest on and after the Excess Proceeds Payment Date;
(v) that Holders electing to have a Note purchased pursuant to the Excess Proceeds Offer will be required to surrender the Note, together with the form entitled "Option of the Holder to Elect Purchase" on the reverse side of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Business Day immediately preceding the Excess Proceeds Payment 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 third Business Day immediately preceding the Excess Proceeds Payment Date, a telegram, facsimile transmission or letter setting forth the name of such Holder, the Issuers principal amount of Notes delivered for purchase and a statement that such Holder is withdrawing his election to have such Notes purchased; and
(vii) that Holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered; provided that each Note purchased and each new Note -------- issued shall be in a principal amount of $1,000 or integral multiples thereof. On the Excess Proceeds Payment Date, the Company shall
(i) accept for payment on a pro rata basis Notes or portions thereof tendered pursuant to the Excess Proceeds Offer up to the Proportionate Share of such Excess Proceeds remaining after application pursuant to the 1997 Senior Notes Offer;
(ii) deposit with the Paying Agent money sufficient to pay the purchase price of all Notes having or portions thereof so accepted; and
(iii) deliver, or cause to be delivered, to the Trustee all Notes or portions thereof so accepted together with an aggregate principal Officer's Certificate specifying the Notes or portions thereof accepted for payment by the Company. The Paying Agent shall promptly mail to the Holders of Notes so accepted payment in an amount equal to the purchase price, and the Trustee shall upon Company Order, promptly authenticate and mail to such Holders a new Note equal in principal amount on to any unpurchased portion of the Note surrendered; provided that each Note purchased and each new Note issued -------- shall be in a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples principal amount of $1,000 principal amount (and in a minimum amount of $1,000) or integral multiples thereof. The Company will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or publicly announce the portion of a Global Note constituting PIK Interest). Upon completion results of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Offer as soon as practicable after the Excess Proceeds remaining after consummation Payment Date. For purposes of this Section 1017, the Offer to Purchase may be used for any purpose not otherwise prohibited by this IndentureTrustee shall act as the Paying Agent. The Issuers shall Company will comply with the requirements of Rule 14e-1 l4e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable applicable, in connection the event that such Excess Proceeds are received by the Company under this Section 1017 and the Company is required to repurchase Notes as described above. SECTION 1018. Limitation on Issuances of Guarantees of Indebtedness ----------------------------------------------------- by Restricted Subsidiaries. -------------------------- The Company will not permit any Restricted Subsidiary, directly or indirectly, to guarantee, assume or in any other manner become liable with respect to any Indebtedness of the purchase Company, other than Indebtedness under Credit Facilities incurred under clauses (i) and (ii) of Section 1011, unless (i) such Restricted Subsidiary simultaneously executes and delivers a supplemental indenture to the Indenture providing for a Guarantee of the Notes pursuant on terms substantially similar to an Offer the guarantee of such Indebtedness, except that if such Indebtedness is by its express terms subordinated in right of payment to Purchase pursuant the Notes, any such assumption, Guarantee or other liability of such Restricted Subsidiary with respect to this Section 4.09. To such Indebtedness shall be subordinated in right of payment to such Restricted Subsidiary's assumption, Guarantee of other liability with respect to the Notes substantially to the same extent that as such Indebtedness is subordinated to the provisions Notes 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 or any other Restricted Subsidiary as a result of any securities laws payment by such Restricted Subsidiary under its Guarantee. Notwithstanding the foregoing, any Guarantee by a Restricted Subsidiary may provide by its terms that it will be automatically and unconditionally released and discharged upon (i) any sale, exchange or regulations conflict with Section 4.09 transfer, to any Person not an Affiliate of the Company, of all of the Company's and each Restricted Subsidiary's Capital Stock in, or Section 3.02all or substantially all of the assets of, such Restricted Subsidiary (which sale, exchange or transfer is not prohibited by the Issuers shall comply with Indenture) or (ii) the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 release or Section 3.02 by virtue discharge of the guarantee which resulted in the creation of such conflictGuarantee, except a discharge or release by or as a result of payment under such guarantee.
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s Board of Directors);
(b2) at least 75% of the consideration received by the Company or its such Restricted Subsidiaries consists of Subsidiary, as the case may be, from such Asset Sale shall be cash or Cash EquivalentsEquivalents and is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ix) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes notes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a such Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Notes and other than liabilities consisting of law Disqualified Capital Stock) (i) that are assumed by the transferee of any such assets and from which the Company and its Restricted Subsidiaries are unconditionally released or a customary novation agreement,
(ii) Additional Assets,
in respect of which neither the Company nor any Restricted Subsidiary following such sale has any obligation and (iiiy) instruments, notes, securities any notes or other obligations received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any no event within 90 more than 60 days of the closingafter receipt, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents (to the extent of the cash or Cash Equivalents actually so received), shall be deemed to be cash for purposes of this provision; and
(iv3) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 450 days of receipt thereof either:
(A) to repay any Designated Non-secured Indebtedness (other than (1) Subordinated Obligations and (2) in the event the Notes become secured by a Lien on any property or assets, Indebtedness secured equally and ratably in such property or assets or secured by Liens junior in priority to the Liens securing the Notes) and, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility;
(B) to reinvest in Productive Assets (and to the extent such reinvestment constitutes an Investment, such reinvestment complies with Section 4.8); or
(C) a combination of repayment and investment permitted by the foregoing clauses (3)(A) and (3)(B). On the 451st day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Consideration received Proceeds relating to such Asset Sale as set forth in clauses (3)(A), (3)(B) and (3)(C) of the immediately preceding sentence (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (3)(A), (3)(B) and (3)(C) of the immediately preceding sentence (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary to make an offer to purchase for cash (the “Net Proceeds Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, from all Holders and holders of pari passu Indebtedness that is subject to a similar repurchase offer requirement on a pro rata basis, that amount of Notes and such pari passu Indebtedness equal to the Net Proceeds Offer Amount at a price in cash equal to 100% of the principal amount of the Notes and such pari passu Indebtedness to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, that if at any time any non-cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may be, in connection with any Asset Sale having an aggregate Fair Market Valueis converted into or sold or otherwise disposed of for cash (other than interest, taken together dividends or other earnings received with all other Designated Nonrespect to any such non-Cash Consideration received pursuant cash consideration), then such conversion or disposition shall be deemed to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from constitute an Asset Sale, Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds may thereof shall be used:applied in accordance with this covenant.
(ib) to permanently repay (A) Debt outstanding under Notwithstanding the Credit Agreement (andforegoing, in if a Net Proceeds Offer Amount is less than $30.0 million, the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds constituting such Net Proceeds Offer Amount to a Net Proceeds Offer may be deferred until such time as such Net Proceeds Offer Amount plus the aggregate amount of all Net Proceeds Offer Amounts arising subsequent to the Net Proceeds Offer Trigger Date relating to such initial Net Proceeds Offer Amount from all Asset Sales by the date of such commitment; provided that (x) such investment is consummated within 180 days of Company and its Restricted Subsidiaries aggregates at least $30.0 million, at which time the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) Company or such binding commitment is terminated, the Restricted Subsidiary shall apply all Net Cash Proceeds not constituting all Net Proceeds Offer Amounts that have been so applied will deferred to make a Net Proceeds Offer (the first date the aggregate of all such deferred Net Proceeds Offer Amounts is equal to $30.0 million or more shall be deemed to be Excess a Net Proceeds Offer Trigger Date).
(c) Notwithstanding paragraphs (a) and (b) of this Section 4.12, the Company and its Restricted Subsidiaries will be permitted to consummate an Asset Sale without complying with such paragraphs to the extent that:
(1) at least 75% of the consideration for such Asset Sale constitutes Productive Assets (and to the extent any of such Productive Assets constitutes an Investment, such Investment complies with Section 4.8); and
(2) such Asset Sale is for at least fair market value (as defined belowdetermined in good faith by the Company’s Board of Directors). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, ; provided that any consideration not constituting Productive Assets received by the Company or any of its Restricted Subsidiary may use Subsidiaries in connection with any Asset Sale permitted to be consummated under this paragraph shall constitute Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior and shall be subject to the end of the 360-day period referred to in the first sentence provisions of this Section 4.09(c)covenant with respect to the application of Net Cash Proceeds; provided that at the time of entering into such transaction or immediately after giving effect thereto, no Default or Event of Default shall have occurred or be continuing or would occur as a consequence thereof.
(d) When Within 25 days following the aggregate amount Net Proceeds Offer Trigger Date, the Company shall mail or cause the Trustee to mail (in the Company’s name and at its expense) notice of a Net Cash Proceeds Offer to the Holders of the Notes at their last registered addresses with a copy to the Trustee and the Paying Agent. The Net Proceeds Offer shall remain open from Asset Sales not applied the time of mailing for at least 20 Business Days and until the close of business on the third Business Day prior to the Net Proceeds Offer Payment Date or such longer period as may be required by Law. The notice shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)Net Proceeds Offer. The notice, which shall govern the Issuers mustterms of the Net Proceeds Offer, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal toshall state:
(i) accumulated Excess Proceeds, multiplied bythat the Net Proceeds Offer is being made pursuant to this Section 4.12;
(ii) a fraction the purchase price (xincluding the amount of accrued and unpaid interest, if any) for each Note and the numerator of which is equal Net Proceeds Offer Payment Date;
(iii) that any Note not tendered or accepted for payment will continue to accrue interest in accordance with the terms thereof;
(iv) that any Note accepted for payment pursuant to the outstanding aggregate Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date unless the Company shall fail to make payment therefor;
(v) that Holders electing to have Notes purchased pursuant to a Net Proceeds Offer will be required to surrender their Notes to the Paying Agent at the address specified in the notice prior to 5:00 p.m., New York City time, on the third Business Day immediately preceding the Net Proceeds Offer Payment Date and must complete any form letter of transmittal proposed by the Company and acceptable to the Trustee and the Paying Agent;
(vi) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than 5:00 p.m., New York City time, on the third Business Day immediately preceding the Net Proceeds Offer Payment Date, a telex or facsimile transmission (confirmed by overnight delivery of the original thereof) or letter setting forth the name of the Holder, the principal amount of Notes the Holder delivered for purchase, the Note certificate number (if any) and a statement that such Holder is withdrawing his election to have such Notes and purchased;
(yvii) the denominator of which is equal to the outstanding aggregate principal amount of the that if Notes and all Debt secured by Liens on the Collateral ranking and, if applicable, other pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for Indebtedness in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate a principal amount in excess of the purchase amount Holders’ pro rata share of the Net Proceeds are tendered and not withdrawn pursuant to the offera Net Proceeds Offer, the Issuers Company shall purchase Notes having an aggregate principal amount equal to the purchase amount and, if applicable, such other Indebtedness on a pro rata basis to among the extent practicable, Notes and other Indebtedness tendered (with such adjustments as may be deemed appropriate by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any or integral multiple of $1.00 multiples thereof shall be acquired);
(viii) that Holders whose Notes are purchased only in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds part will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder issued new Notes equal in principal amount to the extent such laws and regulations are applicable in connection with the purchase unpurchased portion of the Notes surrendered; and
(ix) the instructions that Holders must follow in order to tender their Notes. On or before the Net Proceeds Offer Payment Date, the Company shall (i) accept for payment, on a pro rata basis among the Notes, Notes or portions thereof tendered pursuant to the Net Proceeds Offer, (ii) deposit with the Paying Agent money, in immediately available funds, in an Offer amount sufficient to Purchase pursuant pay the purchase price of all Notes or portions thereof so tendered and accepted and (iii) deliver to this Section 4.09the Paying Agent the Notes so accepted together with an Officer’s Certificate setting forth the Notes or portions thereof tendered to and accepted for payment by the Company. To The Paying Agent shall promptly mail or deliver to Holders of Notes so accepted payment in an amount equal to the extent that purchase price, and the provisions Trustee shall promptly authenticate and mail or deliver to such Holders a new Note equal in principal amount to any unpurchased portion of the Note surrendered. Any Notes not so accepted shall be promptly mailed or delivered by the Company to the Holder thereof. The Paying Agent shall promptly deliver to the Company the balance of any securities laws or regulations conflict with Section 4.09 or Section 3.02, moneys held by the Issuers shall comply with Paying Agent after payment to the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue Holders of such conflictNotes as aforesaid.
Appears in 1 contract
Sources: Indenture (USA Direct, LLC)
Limitation on Asset Sales. The Company shall will not, and shall will not permit any Restricted Subsidiary to, make any Asset Sale unless the following conditions are met:
(ai) the Asset Sale is for Company or the Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least Fair Market Value; and
equal to the fair market value of the assets sold or disposed of as determined by the good-faith judgment of the Board of Directors evidenced by a Board Resolution and (bii) at least 7585% of the consideration received by the Company for such sale or its Restricted Subsidiaries other disposition consists of cash or Cash Equivalents; provided that for purposes of this clause (2), each of the following shall be considered cash equivalents or Cash Equivalents:
(i) the assumption by of unsubordinated Indebtedness. The Company shall, or shall cause the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a relevant Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instrumentsto, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 270 days after the date of receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including A), (i) apply an amount equal to such Net Cash Proceeds to permanently repay unsubordinated Indebtedness of the Company or Indebtedness of any Restricted Subsidiary, in each case owing to a reduction 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) in borrowings under any revolving credit facilityproperty or assets of a nature or type or that are used in a business (or in a company having property and assets of a nature or type, or engaged in a business) prior similar or related to the nature or type of the property and assets of, or the business of, the Company and its Restricted Subsidiaries 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 (ii) apply (no later than the end of the 360270-day period referred to above) such excess Net Cash Proceeds (to the extent not applied pursuant to clause (i)) as provided in the first sentence following paragraphs of this Section 4.09(c)1017. The amount of such Net Cash Proceeds required to be applied (or to be committed to be applied) during such 270-day period as set forth in clause (i) of the preceding sentence and not applied as so required by the end of such period shall constitute "Excess Proceeds.
(d) When " If, as of the first day of any calendar month, the aggregate amount of Net Cash Excess Proceeds from Asset Sales not applied pursuant theretofore subject to an Excess Proceeds Offer (and within the time frame set forth inas defined below) Section 4.09(c) exceeds totals at least $25.0 million (“Excess Proceeds”)10.0 million, the Issuers Company must, within 30 daysnot later than the thirtieth Business Day thereafter, make an offer (an "Excess Proceeds Offer") to purchase, in accordance with Section 3.02, Notes having purchase from the holders on a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding pro rata basis an aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens Excess Proceeds on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaidsuch date, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The at a purchase price for the Notes will be equal to 100% of the principal amount plus of the Notes, plus, in each case, accrued and unpaid interest to, but excluding to the date of purchasepurchase (the "Excess Proceeds Payment"). If The Company shall 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 Purchase this Section 1017 and that all Notes validly tendered will be accepted for payment on a pro rata basis; (ii) the purchase price and the date of purchase (which shall be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is for less than all mailed) (the "Excess Proceeds Payment Date"); (iii) that any Note not tendered will continue to accrue interest pursuant to its terms; (iv) that, unless the Company defaults in the payment of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn Excess Proceeds Payment, any Note accepted for payment pursuant to the offerExcess Proceeds Offer shall cease to accrue interest on and after the Excess Proceeds Payment Date; (v) that holders electing to have a Note purchased pursuant to the Excess Proceeds Offer will be required to surrender the Note, together with the form entitled "Option of the Holder to Elect Purchase" on the reverse side of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Business Day immediately preceding the Excess Proceeds Payment 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 third Business Day immediately preceding the Excess Proceeds Payment Date, a telegram, facsimile transmission or letter setting forth the name of such holder, the Issuers principal amount of Notes delivered for purchase and a statement that such holder is withdrawing his election to have such Notes purchased; and (vii) that holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered; provided that each Note purchased -------- and each new Note issued shall be in a principal amount of $1,000 or integral multiples thereof. On the Excess Proceeds Payment Date, the Company shall (i) accept for payment on a pro rata basis Notes 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 Notes having or portions thereof so accepted; and (iii) deliver, or cause to be delivered, to the Trustee all Notes or portions thereof so accepted together with an aggregate principal Officers' Certificate specifying the Notes or portions thereof accepted for payment by the Company. The Paying Agent shall promptly mail to the holders of Notes so accepted payment in an amount equal to the purchase price, and the Trustee shall upon Company Order promptly authenticate and mail to such holders a new Note equal in principal amount on to any unpurchased portion of the Note surrendered; provided that each Note -------- purchased and each new Note issued shall be in a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples principal amount of $1,000 principal amount (and in a minimum amount of $1,000) or integral multiples thereof. The Company will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or publicly announce the portion of a Global Note constituting PIK Interest). Upon completion results of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Offer as soon as practicable after the Excess Proceeds remaining after consummation Payment Date. For purposes of this Section 1017, the Offer to Purchase may be used for any purpose not otherwise prohibited by this IndentureTrustee shall act as the Paying Agent. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable applicable, in connection the event that such Excess Proceeds are received by the Company under this Section 1017 and the Company is required to repurchase Notes as described above. SECTION 1018. Limitation on Issuances of Guarantees of Indebtedness ----------------------------------------------------- by Restricted Subsidiaries. -------------------------- The Company will not permit any Restricted Subsidiary, directly or indirectly, to guarantee, assume or in any other manner become liable with respect to any Indebtedness of the purchase Company, other than Indebtedness under Credit Facilities incurred under clauses (i) and (ix) in paragraph (b) of Section 1011, unless (i) such Restricted Subsidiary simultaneously executes and delivers a supplemental indenture to the Indenture providing for a Guarantee of the Notes pursuant on terms substantially similar to an Offer the guarantee of such Indebtedness, except that if such Indebtedness is by its express terms subordinated in right of payment to Purchase pursuant the Notes, any such assumption, Guarantee or other liability of such Restricted Subsidiary with respect to this Section 4.09. To such Indebtedness shall be subordinated in right of payment to such Restricted Subsidiary's assumption, Guarantee of other liability with respect to the Notes substantially to the same extent that as such Indebtedness is subordinated to the provisions Notes and (ii) such Restricted Subsidiary waives, and will not in any manner whatsoever claim or take the benefit or advantage of, any rights or reimbursement, indemnity or subrogation or any other rights against the Company or any other Restricted Subsidiary as a result of any securities laws payment by such Restricted Subsidiary under its Guarantee. Notwithstanding the foregoing, any Guarantee by a Restricted Subsidiary may provide by its terms that it will be automatically and unconditionally released and discharged upon (i) any sale, exchange or regulations conflict with Section 4.09 transfer, to any Person not an Affiliate of the Company, of all of the Company's and each Restricted Subsidiary's Capital Stock in, or Section 3.02all or substantially all of the assets of, such Restricted Subsidiary (which sale, exchange or transfer is not prohibited by the Issuers shall comply with Indenture) or (ii) the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 release or Section 3.02 by virtue discharge of the guarantee which resulted in the creation of such conflictGuarantee, except a discharge or release by or as a result of payment under such guarantee.
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall not, and shall not cause or permit any of its Restricted Subsidiary Subsidiaries to, make any complete an Asset Sale unless the following conditions are metunless:
(a1) the Asset Sale is for Company or such applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least equal to the Fair Market Value; andValue of the assets sold or otherwise disposed of;
(b2) at least not less than 75% of the consideration received by the Company or its such applicable Restricted Subsidiaries consists Subsidiary, as the case may be, is in the form of (A) cash or Cash Equivalents; provided that for purposes , or (B) Replacement Assets, and in each case set forth in subclauses (A) and (B) of this clause (2a)(2), each is received at the time of such sale or other disposition; provided, that the following shall be considered cash or Cash Equivalents:
amount of (i) the assumption by the purchaser of any Debt or other obligations or liabilities (that would appear as shown liabilities on the Company’s most recent a balance sheet or prepared in the footnotes thereto) accordance with GAAP (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the NotesDebt) of the Company or a any such applicable Restricted Subsidiary pursuant to operation of law that is actually assumed by the transferee in such Asset Sale (or a customary novation agreement,
third party on behalf of the transferee) and from which the Company or such applicable Restricted Subsidiaries are fully and unconditionally released, and (ii) Additional Assets,
(iii) instruments, notes, any securities or other obligations notes received by the Company or any such applicable Restricted Subsidiary from the purchaser that which are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents within 180 days of such Asset Sale (to the extent of the cash or Cash Equivalents actually so received), will be deemed to be cash for purposes of this clause (a)(2) and to have been received at the time of such sale; and
(ivb) any Designated Non-Cash Consideration The Asset Sale Proceeds received by the Company or such Restricted Subsidiary Subsidiary, as the case may be, may be applied, at the option of the Company or such Restricted Subsidiary:
(1) if the assets subject of such Asset Sale constitute Notes Priority Lien Collateral, (i) first, to prepay, repay or purchase (or offer to prepay, repay or purchase, as applicable) any Priority Lien Obligations on a pro rata basis; and (ii) second, to prepay, repay or purchase (or offer to prepay, repay or purchase, as applicable) any Subordinated Lien Obligations on a pro rata basis; provided, that any repayment, prepayment or purchase of (or offer to prepay, repay or purchase) obligations under the Floating Rate Notes shall be made as provided under Section 4.01, through open-market purchases (to the extent such purchases are at or above 100% of the principal amount thereof plus accrued unpaid interest) or by making an offer (in accordance with the procedures set forth below for an Excess Proceeds Offer) to all Holders of Floating Rate Notes to purchase their Floating Rate Notes at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, on the amount of Floating Rate Notes that would otherwise be purchased;
(2) if the assets subject of such Asset Sale do not constitute Notes Priority Lien Collateral, to prepay, repay or purchase (or offer to prepay, repay or purchase, as applicable) indebtedness under any Credit Facilities or any other secured Debt of the Company (including the Floating Rate Notes) or any Restricted Subsidiary; provided, that any repayment, prepayment or purchase of (or offer to prepay, repay or purchase) obligations under the Floating Rate Notes shall be made as provided under Section 4.01, through open-market purchases (to the extent such purchases are at or above 100% of the principal amount thereof plus accrued unpaid interest) or by making an offer (in accordance with the procedures set forth below for an Excess Proceeds Offer) to all Holders of Floating rate Notes to purchase their Floating Rate Notes at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, on the amount of Floating Rate Notes that would otherwise be purchased; or
(3) to make capital expenditures or to make an investment in properties and assets that are used or useful in the business of the Company or its Restricted Subsidiaries or in businesses reasonably similar to or ancillary to the business of the Company or its Restricted Subsidiaries as conducted at the time of such Asset Sale (including the acquisition of Capital Stock of any such business or businesses); provided, that (i) the Consolidated Secured Leverage Ratio calculated as of the last day of the most recently ended quarter prior to the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant for which financial statements are required to this clause be delivered does not exceed 2.5 to 1.0; and (dii) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and such investment occurs, or (y) $30.0 million the Company or any such Restricted Subsidiary enters into contractual commitments to so apply such Asset Sale Proceeds, subject only to customary conditions other than the obtaining of financing, in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 case, within 365 days after following the receipt of any Net Cash such Asset Sale Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the any commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (iiy) or (iii) above shall be treated as a permitted application of above, the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is transactions contemplated thereby are consummated within 180 days of the end date such commitment is entered into); provided, further, to the extent Asset Sale Proceeds of Collateral are used to acquire additional assets, such additional assets (other than, for avoidance of doubt, Excluded Assets) are pledged subject to the Intercreditor Agreement and the Collateral Trust Agreement, as Collateral for the benefit of the 360-day period referred Collateral Trustee, the Trustee and the Holders of Floating Rate Notes. Pending any such reinvestment (x) Asset Sale Proceeds of Notes Priority Lien Collateral shall, as promptly as practicable, subject to the Intercreditor Agreement, be deposited in a Noteholder Proceeds Collateral Account pledged as Notes Priority Lien Collateral for the first sentence benefit of this paragraph the Priority Lien Obligations, Subordinated Lien Obligations and ABL Debt Obligations in accordance with the Intercreditor Agreement and the Collateral Trust Agreement, and (y) if such acquisition is not consummated within Asset Sale Proceeds of ABL Priority Lien Collateral shall, as promptly as practicable, subject to the period set forth Intercreditor Agreement, be deposited in clause (x) a deposit account or such binding commitment is terminatedsecurities account pledged as ABL Priority Lien Collateral for the benefit of the ABL Debt Obligations, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof Priority Lien Obligations and Subordinated Lien Obligations in accordance with this Section 4.09, the Company or Intercreditor Agreement and the Collateral Trust Agreement. If on the 45th day following any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to or the end of 365th day if the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, Consolidated Secured Leverage Ratio calculated in accordance with Section 3.0210.09(b)(3)(i) does not exceed 2.5 to 1.0), Notes having a principal the Available Asset Sale Proceeds exceed $7,500,000, the Company will apply an amount equal to:
to such Available Asset Sale Proceeds to an offer to repurchase (i) accumulated Excess Proceeds, multiplied by
the Floating Rate Notes and (ii) at its option, other Secured Debt, in each case at a fraction (x) the numerator of which is purchase price in cash equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount of the Floating Rate Notes and such other Secured Debt, plus accrued interest toand unpaid interest, but excluding if any, to the purchase date of purchase. If (an "Excess Proceeds Offer"); provided, that if the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are Floating Rate Notes (and other Secured Debt, if applicable) tendered and not withdrawn pursuant to the offerExcess Proceeds Offer exceeds the Available Asset Sale Proceeds, the Issuers Company shall purchase first repurchase the tendered Priority Lien Debt, including any Floating Rate Notes having an aggregate principal amount equal selected to the purchase amount be repurchased on a pro rata basis to basis, by lot or in such other manner as the extent practicableTrustee shall determine, with adjustments by before any Subordinated Lien Debt is repurchased. The Company may satisfy the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof foregoing obligations with respect to a PIK Note or any such Available Asset Sale Proceeds by making an Excess Proceeds Offer with respect to such Available Asset Sale Proceeds prior to the portion of a Global Note constituting PIK Interest). Upon completion expiration of the Offer relevant 45-day period (or such longer period provided above) or with respect to Purchase, Available Asset Sale Proceeds of less than $7,500,000. If an Excess Proceeds will be reset at zeroOffer is not fully subscribed, the Company may retain and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used use for general corporate purposes or any purpose not otherwise prohibited by this IndentureIndenture the portion of the Available Asset Sale Proceeds not required to repurchase Floating Rate Notes (or other Secured Debt, if applicable). Upon completion of any Excess Proceeds Offer, the amount of Available Asset Sale Proceeds shall be reset to zero.
(c) If the Company is required to make an Excess Proceeds Offer, the Company shall mail, within 30 days of the 45th day following the receipt of Available Asset Sale Proceeds (or the 365th day if the Consolidated Secured Leverage Ratio calculated in accordance with Section 10.09(b)(3)(i) does not exceed 2.5 to 1.0) exceeding $7,500,000 as specified in Section 10.09(b), a notice to the Holders, at the address appearing in the Register maintained by the Registrar, with a copy to the Trustee, stating the information set forth below. The Issuers notice, which shall govern the terms of the Excess Proceeds Offer, shall state:
(1) that the Company is offering to apply the Available Asset Sale Proceeds to repurchase Floating Rate Notes at a purchase price in cash equal to 100% of the principal amount of the Floating Rate Notes, plus accrued and unpaid interest, if any, to the purchase date;
(2) the purchase date (which shall be no earlier than 30 days nor later than 60 days from the date such notice is mailed);
(3) the instructions that each Holder must follow in order to have Floating Rate Notes purchased, which shall be reasonable and customary for transactions of this nature; and
(4) the calculations used in determining the amount of Available Asset Sale Proceeds to be applied to the purchase of Floating Rate Notes. The Company shall comply with the requirements of 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 connection with the purchase repurchase of the Floating Rate Notes pursuant to in connection with an Offer to Purchase pursuant to this Section 4.09Excess Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with this Section 4.09 or Section 3.0210.09, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed not to have breached their its obligations under this Section 4.09 or Section 3.02 10.09 by virtue of such conflictcompliance.
Appears in 1 contract
Sources: Second Supplemental Indenture (Catalyst Paper Corp)
Limitation on Asset Sales. (i) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consumate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s senior management or, in the case of an Asset Sale in excess of $5.0 million, the Board of Directors of the Company);
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of (x) cash or Cash Equivalents, (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business or (z) Capital Stock in one or more Persons engaged in a Permitted Business that are or thereby become Restricted Subsidiaries of the Company, and, in each case, such consideration is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Securities) that are assumed by the transferee of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations securities received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 180 days after such Asset Sale (to the extent of the cash or Cash Equivalents actually so received, received in the conversion) shall be deemed to be cash for the purposes of this provision only; and
(iviii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either:
(A) to permanently reduce any Designated Non-Indebtedness that is secured by a Lien permitted under this Indenture, including Indebtedness under the Credit Agreement, or any Indebtedness of a Restricted Subsidiary that is not a Guarantor and, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility (or effect a permanent reduction in the availability under such revolving credit facility regardless of the fact that no prepayment is required);
(B) to make an investment (x) in properties and assets that replace the properties and assets that were the subject of such Asset Sale, (y) in properties and assets that will be used by the Company or a Restricted Subsidiary in a Permitted Business or (z) permitted by clause (1) of the definition of Permitted Investments (collectively, “Replacement Assets”); or
(C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Pending the final application of the Net Cash Consideration received Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Indebtedness or otherwise invest such Net Cash Proceeds in any manner not prohibited by this Indenture. On the 361st day after an Asset Sale or such earlier date, if any, as the senior management or the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary in to make an offer to purchase (the Asset Sale having an aggregate Fair Market Value“Net Proceeds Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, taken together with from all other Designated Non-Cash Consideration received pursuant Holders on a pro rata basis, that amount of Securities equal to this clause (d) the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Securities to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, that if the Company so elects or is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in required by the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt terms of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking Indebtedness that ranks pari passu with the Liens securing Securities, such Net Proceeds Offer may be made ratably to purchase the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business Securities and such other Indebtedness of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of ranks pari passu with the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360Securities. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this Section. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from an one or more Asset Sale for general corporate purposes Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $10.0 million, shall be applied as required pursuant to the end second preceding paragraph). In the event of the 360-day period referred transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01, which transaction does not constitute a Change of Control, the first sentence successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section, and shall comply with the provisions of clause (iii) of this Section 4.09(c).
(d) When with respect to such deemed sale as if it were an Asset Sale. In addition, the aggregate amount fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from Asset Sales not applied for purposes of this Section 4.17. Notice of each Net Proceeds Offer pursuant to (this Section 4.17 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and within materials necessary to enable such Holders to tender Securities pursuant to the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), Net Proceeds Offer and shall state the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal tofollowing terms:
(i) accumulated Excess Proceedsthat Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to prorationing as hereinafter described in the event the Net Proceeds Offer is oversubscribed) in integral multiples of $1,000 of principal amount, multiplied byat the applicable purchase price;
(ii) that the Net Proceeds Offer is being made pursuant to this Section 4.17 and that all Securities tendered will be accepted for payment; provided, however, that if the principal amount of Securities tendered in the Net Proceeds Offer exceeds the aggregate amount of the Net Proceeds Offer Amount, the Company shall select the Securities to be purchased on a fraction pro rata basis (xbased on amounts tendered);
(iii) the numerator purchase price (including the amount of accrued interest, if any) and the purchase date (which is equal shall be no earlier than 30 days nor later than 60 days from the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(iv) that any Security not tendered will continue to accrue interest;
(v) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the outstanding aggregate Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(vi) that Holders electing to have a Security purchased pursuant to the Net Proceeds Offer will be required to surrender the Security, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Offer Payment Date;
(vii) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes Security the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; and
(yviii) the denominator of which is that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers’ Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so to the Holder thereof. For purposes of this Section 4.17, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that only Notes in multiples of $1,000 principal amount (and in a minimum the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect the Securities tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.17, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.17 by virtue thereof. The provisions of such conflictthis Section and other provisions contained in this Indenture relating to the Company’s obligation to make a Net Proceeds Offer may be waived or modified with the written consent of the Holders of a majority in principal amount of the Securities.
Appears in 1 contract
Sources: Indenture (Quality Distribution Inc)
Limitation on Asset Sales. The Company shall will not, and shall will not permit any Restricted Subsidiary to, make any Asset Sale unless the following conditions are met:
(ai) the Asset Sale is for Company or the Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least equal to the Fair Market Value; and
Value of the assets sold or disposed of as determined by the good-faith judgment of the Board of Directors, which determination, in each case where such fair market value is greater than $5.0 million, shall be evidenced by a Board Resolution and (bii) at least 75% of the consideration received by the Company for such sale or its Restricted Subsidiaries other disposition consists of cash or Cash Equivalents; provided that for purposes of this clause (2), each of the following shall be considered cash equivalents or Cash Equivalents:
(i) the assumption by of unsubordinated Indebtedness. The Company shall, or shall cause the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a relevant Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instrumentsto, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the date of receipt of any the Net Cash Proceeds from an Asset Sale, the (i) (A) apply an amount equal to such Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under unsubordinated Indebtedness of the Credit Agreement (andCompany or Indebtedness of any Restricted Subsidiary, in each case owing to a Person other than the case Company or any of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) its Restricted Subsidiaries or (B) invest an equal amount, or the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes amount not so applied pursuant to clause (if anyA) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in long-term property or assets of a nature or type or that are used in a Permitted Business business (or in a company having property and assets of a nature or type, or engaged in a business) similar or related to the nature or type of the property and assets of, or the business of, the Company or one or more and its Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from Subsidiaries existing on the date of such commitment; provided that investment (xas determined in good faith by the Board of Directors, whose determination shall be conclusive and evidenced by a Board Resolution) such investment is consummated within 180 days of and (ii) apply (no later than the end of the 360-day period referred to above) such excess Net Cash Proceeds (to the extent not applied pursuant to clause (i)) as provided in the first sentence following paragraphs of this paragraph and Section 1017. The amount of such Net Cash Proceeds required to be applied (yor to be committed to be applied) if during such acquisition is not consummated within 360-day period in the period manner as set forth in clause (xi) or of the preceding sentence and not applied as so required by the end of such binding commitment is terminatedperiod shall constitute "Excess Proceeds." If, as of the first day of any calendar month, the Net Cash aggregate amount of Excess Proceeds not so applied will be deemed theretofore subject to be an Excess Proceeds Offer (as defined below). For ) totals at least $10.0 million, the avoidance Company must, not later than the 30th Business Day thereafter, (i) use such Excess Proceeds to make an offer to purchase the 11-3/4% Senior Notes due 2004 of doubt, pending application thereof the Company in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash terms of such Indebtedness which require such a purchase offer and do not provide for proration of the amount of such Indebtedness to be purchased with such Exceeds Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facilitythe "1997 Senior Notes Offer") prior and (ii) to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash extent Excess Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 daysremain after such offer is consummated, make an offer (an "Excess Proceeds Offer") to purchase, in accordance with Section 3.02, Notes having purchase from the Holders on a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding pro rata basis an aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount Proportionate Share of the Notes and all Debt secured by Liens Excess Proceeds on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down such date remaining after application pursuant to the nearest $1,000. The 1997 Senior Notes Offer, at a purchase price for the Notes will be equal to 100% of the principal amount plus of the Notes, plus, in each case, accrued and unpaid interest to, but excluding to the date of purchasepurchase (the "Excess Proceeds Payment"). If the The Company shall commence an Excess Proceeds Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant by mailing a notice to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (Trustee and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.each Holder stating:
Appears in 1 contract
Limitation on Asset Sales. The (a) Prior to the Conversion Date, the Company shall not, and nor shall not it cause or permit any of its Restricted Subsidiary Subsidiaries to, make directly or indirectly, consummate any Asset Sale unless other than the following conditions Disposition; provided, that all of the Net Cash Proceeds in respect thereof are met:
(a) applied by the Asset Sale is for at least Fair Market Value; andCompany or a Restricted Subsidiary of the Company in accordance with Section 2.5A(ii)(a).
(b) After the Conversion Date, the Company shall not, nor shall it cause or permit any of its Restricted Subsidiaries to, directly or indirectly, consummate any Asset Sale unless
(1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the fair market value of the assets or Capital Stock sold or issued or otherwise disposed of (as determined in good faith by the Company's Board of Directors),
(2) at least 75% of the consideration received by the Company or its such Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash Equivalents; , and is received at the time of such disposition (provided that that, for purposes of this clause (2), each of ) the following shall will be considered cash "cash" or "Cash Equivalents:"):
(i) the assumption any Senior Debt or Guarantor Senior Debt that is assumed by the purchaser transferee of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment any such assets, to the Notes) of extent the Company or a such Restricted Subsidiary pursuant to operation of law or a customary novation agreement,is released from any further liability; and
(ii) Additional Assets,
(iii) instrumentsany securities, notes, securities notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents (to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 within 30 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase belowreceipt,
(ii3) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application all of the Net Cash Proceeds from in respect thereof are applied by the date of such commitment; provided that (x) such investment is consummated within 180 days Company or a Restricted Subsidiary of the end of the 360-day period referred to Company in the first sentence of this paragraph and accordance with Section 2.5A(ii)(a),
(y4) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with from any single Asset Sale under this Section 4.09, 6.12(b) do not exceed $5.0 million; and
(5) the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from all such Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations permitted under this Section 4.09 or Section 3.02 by virtue of such conflict6.12(b) do not exceed $25.0 million.
Appears in 1 contract
Sources: Senior Subordinated Credit Agreement (Ameristar Casinos Inc)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; and
equal to the fair market value of the assets sold or otherwise disposed of (bas determined in good faith by the Company's Board of Directors), (ii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists of Subsidiary, as the case may be, from such Asset Sale shall be cash or Cash Equivalents; provided PROVIDED that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any such Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Notes) that are assumed by the transferee of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, immediately converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash received), shall be deemed to be cash for the purposes of this provision or for purposes of the third paragraph of this covenant, and (iii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Equivalents actually so receivedProceeds relating to such Asset Sale within 365 days of receipt thereof either (A) to prepay any Senior Debt or any Guarantor Senior Debt and, and
in the case of any Senior Debt or Guarantor Senior Debt under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility, (ivB) to reinvest in Productive Assets, or (C) a combination of prepayment, repurchase and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Pending the final application of any Designated Non-such Net Cash Consideration received Proceeds, the Company or such Restricted Subsidiary may temporarily reduce Indebtedness under a revolving credit facility, if any, or otherwise invest such Net Cash Proceeds in Cash Equivalents. On the 366th day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) or (iii)(C) of the next preceding sentence (each, a "NET PROCEEDS OFFER TRIGGER DATE"), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each a "NET PROCEEDS OFFER AMOUNT") shall be applied by the Company or such Restricted Subsidiary to make an offer to purchase (the "NET PROCEEDS OFFER") on a date (the "NET PROCEEDS OFFER PAYMENT DATE") not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, from all Holders on a pro rata basis that amount of Notes equal to the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Notes to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; PROVIDED, HOWEVER, that if at any time any non-cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may be, in the connection with any Asset Sale having an aggregate Fair Market Valueis converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), taken together with all other Designated Non-Cash Consideration received pursuant then such conversion or disposition shall be deemed to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from constitute an Asset Sale, Sale hereunder and the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above thereof shall be treated as applied in accordance with this covenant. Notwithstanding the foregoing, if a permitted Net Proceeds Offer Amount is less than $10.0 million, the application of the Net Cash Proceeds constituting such Net Proceeds Offer Amount to a Net Proceeds Offer may be deferred until such time as such Net Proceeds Offer Amount plus the aggregate amount of all Net Proceeds Offer Amounts arising subsequent to the Net Proceeds Offer Trigger Date relating to such initial Net Proceeds Offer Amount from all Asset Sales by the date of such commitment; provided that (x) such investment is consummated within 180 days of Company and its Restricted Subsidiaries aggregates at least $10.0 million, at which time the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) Company or such binding commitment is terminated, the Restricted Subsidiary shall apply all Net Cash Proceeds not constituting all Net Proceeds Offer Amounts that have been so applied will deferred to make a Net Proceeds Offer (the first date the aggregate of all such deferred Net Proceeds Offer Amounts is equal to $10.0 million or more shall be deemed to be Excess Proceeds (as defined belowa "NET PROCEEDS OFFER TRIGGER DATE"). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Each Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior Offer will be mailed to the end record Holders as shown on the register of Holders within 25 days following the Net Proceeds Offer Trigger Date, with a copy to the Trustee, and shall comply with the procedures set forth in the Indenture. Upon receiving notice of the 360-day period referred Net Proceeds Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1,000 in exchange for cash. To the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and extent Holders properly tender Notes in an aggregate principal amount in excess exceeding the Net Proceeds Offer Amount, Notes of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount tendering Holders will be purchased on a pro rata basis (based on amounts tendered). A Net Proceeds Offer shall remain open for a period of 20 business days or such longer period as may be required by law. To the extent that the aggregate amount of Notes tendered pursuant to a Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use any remaining Net Proceeds Offer Amount for general corporate purposes. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero.
(b) Subject to the extent practicabledeferral of the Net Proceeds Offer Trigger Date contained in the second paragraph of subsection (a) above, each notice of a Net Proceeds Offer pursuant to this Section 4.16 shall be mailed or caused to be mailed, by first class mail, by the Company not more than 25 days after the Net Proceeds Offer Trigger Date to all Holders at their last registered addresses as of a date within 15 days of the mailing of such notice, with a copy to the Trustee. The notice shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Net Proceeds Offer and shall state the following terms:
(1) that the Net Proceeds Offer is being made pursuant to Section 4.16 and that all Notes tendered will be accepted for payment; PROVIDED, HOWEVER, that if the aggregate principal amount of Notes tendered in a Net Proceeds Offer plus accrued interest at the expiration of such offer exceeds the aggregate amount of the Net Proceeds Offer, the Company shall select the Notes to be purchased on a PRO RATA basis (with such adjustments as may be deemed appropriate by the Company so that only Notes in multiples denominations of $1,000 or multiples thereof shall be purchased);
(2) the purchase price (including the amount of accrued interest) and the purchase date (which shall be 20 Business Days from the date of mailing of notice of such Net Proceeds Offer, or such longer period as required by law) (the "PROCEEDS PURCHASE DATE"); PROVIDED that the Proceeds Purchase Date for the Notes shall be a date subsequent to any payment dates for the purchase or other repayment of Senior Debt having similar provisions;
(3) that any Note not tendered will continue to accrue interest;
(4) that, unless the Company defaults in making payment therefore, any Note accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Proceeds Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to a Net Proceeds Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day prior to the Proceeds Purchase Date;
(6) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than five Business Days prior to the Proceeds Purchase Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased; and
(and 7) that Holders whose Notes are purchased only in part will be issued new Notes in a minimum principal amount equal to the unpurchased portion of the Notes surrendered; PROVIDED that each Note purchased and each new Note issued shall be in an original principal amount of $1,0001,000 or integral multiples thereof. On or before the Proceeds Purchase Date, the Company shall (i) will accept for payment Notes or portions thereof tendered pursuant to the Net Proceeds offer which are to be purchased in accordance with item (b)(1) above, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the purchase price plus accrued interest, if any, of all Notes to be purchased and (iii) deliver to the Trustee Notes so accepted together with an Officers' Certificate stating the Notes or portions thereof being purchased by the Company. The Paying Agent shall promptly mail to the Holders of Notes so accepted payment in an amount equal to the purchase price plus accrued interest, if a PIK Payment has been madeany. For purposes of this Section 4.16, in denominations the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of $1.00 and any integral multiple of $1.00 in excess thereof with respect Notes pursuant to a PIK Note or Net Proceeds Offer shall be returned by the portion of a Global Note constituting PIK Interest). Upon completion of Trustee to the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this IndentureCompany. The Issuers Company shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02the provisions of this Indenture relating to a Net Proceeds Offer, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 relating to such Net Proceeds offer by virtue of such conflictthereof.
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any Restricted Subsidiary to, make any directly or indirectly, consummate an Asset Sale (including the sale of any of the Capital Stock of any Restricted Subsidiary) providing for Net Proceeds in excess of $2,500,000 unless at least 75% of the Net Proceeds from such Asset Sale are applied (in any manner otherwise permitted hereunder) to one or more of the following conditions are met:
purposes in such combination as the Company shall elect: (ai) an investment in another asset or business in the same line of business as, or a line of business similar to that of, the line of business of the Company and its Restricted Subsidiaries at the time of the Asset Sale; provided that such investment occurs on or prior to the 365th day following the date of such Asset Sale (the "Asset Sale Disposition Date"), (ii) to reimburse the Company or its Subsidiaries for expenditures made, and costs incurred, to repair, rebuild, replace or restore property subject to loss, damage or taking to the extent that the Net Proceeds consist of insurance proceeds received on account of such loss, damage or taking, (iii) the purchase, redemption or other prepayment or repayment of outstanding Senior Indebtedness of the Company or Indebtedness of the Company's Restricted Subsidiaries on or prior to the 365th day following the Asset Sale is for at least Fair Market Value; andDisposition Date or (iv) an Offer expiring on or prior to the Purchase Date.
(b) The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, consummate an Asset Sale unless at least 75% of the consideration thereof received by the Company or its such Restricted Subsidiaries consists Subsidiary is in the form of cash, cash equivalents or Cash Equivalentsmarketable securities; provided that that, solely for purposes of this clause (2), each calculating such 75% of the following shall be considered cash or Cash Equivalents:
consideration, the amount of (i) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes notes thereto) (other than Subordinated Debt or other obligations or , excluding contingent liabilities subordinated in right of payment to the Notes) and trade payables), of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Senior Notes) that are assumed by the transferee of law or a customary novation agreement,
any such assets and (ii) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any no event within 90 more than 30 days of the closingafter receipt, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received), and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below)cash and cash equivalents for purposes of this provision. For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Any Net Cash Proceeds from an any Asset Sale for general corporate purposes (including a reduction that are not applied or invested as provided in borrowings under any revolving credit facilitySection 4.14(a) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c)hereof shall constitute "Excess Proceeds."
(dc) When the aggregate amount of Net Cash Excess Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million 5,000,000 (“Excess Proceeds”such date being an "Asset Sale Trigger Date"), the Issuers must, within 30 days, Company shall make an Offer to all Holders of Senior Notes to purchase the maximum principal amount of the Senior Notes then outstanding that may be purchased out of Excess Proceeds, at an offer price in cash in an amount equal to purchase, 100% of principal amount thereof plus any accrued and unpaid interest to the Purchase Date in accordance with Section 3.02, Notes having a principal amount equal to:the procedures set forth in this Indenture.
(id) accumulated To the extent that any Excess ProceedsProceeds remain after completion of an Offer, multiplied bythe Company may use such remaining amount for general corporate purposes.
(iie) a fraction (x) If the numerator of which is equal to the outstanding aggregate principal amount of Senior Notes surrendered by Holders thereof exceeds the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of Excess Proceeds, the Trustee shall select the Senior Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount purchased on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount basis.
(and in a minimum amount of $1,000f) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of an Offer, the Offer to Purchase, amount of Excess Proceeds will shall be reset at zero.
(g) Notwithstanding the foregoing, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase that any or all of the Notes pursuant Net Proceeds of an Asset Sale is prohibited or delayed by applicable local law from being repatriated to an Offer the United States, the portion of such Net Proceeds so affected will not be required to Purchase be applied pursuant to this Section 4.094.14, but may be retained for so long, but only for so long, as the applicable local law prohibits repatriation to the United States. To The Company will promptly take all reasonable actions required by the extent that the provisions applicable local law to permit such repatriation, and once such repatriation of any securities laws or regulations conflict with Section 4.09 or Section 3.02affected Net Proceeds is not prohibited under applicable local law, such repatriation will be immediately effected and such repatriated Net Proceeds will be applied in the Issuers shall comply with manner set forth above as if such Asset Sale have occurred on the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue date of such conflictrepatriation.
Appears in 1 contract
Sources: Indenture (Ameriking Inc)
Limitation on Asset Sales. The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary receives consideration at the time of such Asset Sale is for at least Fair Market Valueequal to the fair market value of the assets that are sold or otherwise disposed of, as reasonably determined in good faith by the Company’s Board of Directors or a senior officer of the Company; and
(b2) at least 75% of the consideration received by the Company or its the applicable Restricted Subsidiaries consists Subsidiary from the Asset Sale is in the form of cash or Cash Equivalents; provided that for purposes in the case of the sale of all of the IMC Salt Business Unit and ▇▇▇▇▇, in the alternative, up to 35% of the consideration received by the Company or the applicable Restricted Subsidiary in the sale may be in the form of Capital Stock of the Person that will hold the IMC Salt Business Unit and ▇▇▇▇▇ following the Asset Sale if the remainder is in the form of cash or Cash Equivalents; provided, further, that the requirement in this clause (2), each ) shall not apply in the case of the following shall sale of all or any part of the IMC Chemicals Business Unit. For the purposes of clause (2) above, the amount of any Indebtedness shown on the most recent applicable balance sheet of the Company or the applicable Restricted Subsidiary, other than Indebtedness that is by its terms subordinated to the Notes or any Note Guarantee, that is assumed by the transferee of any such assets will be considered cash deemed to be cash. Additionally, the Company or such Restricted Subsidiary, as the case may be, must apply the Net Cash EquivalentsProceeds from each Asset Sale to:
(i1) repay Indebtedness under the assumption Credit Agreement;
(2) repay (including by purchase) secured obligations;
(3) repay (including by purchase) any Indebtedness of any Restricted Subsidiary that is not a Guarantor; and/or
(4) make an investment in or expenditures for assets (including Capital Stock of any entity) (a) that replace the purchaser assets that were the subject of Debt the Asset Sale or other obligations or liabilities (b) that will be used in the business of the Company and its Subsidiaries as shown existing on the Company’s most recent balance sheet Issue Date or in businesses reasonably related thereto (“Replacement Assets”). Any Net Cash Proceeds that the footnotes theretoCompany does not apply, or decides not to apply, in accordance with the preceding paragraph will constitute a “Net Proceeds Offer Amount.” The 366th day after an Asset Sale or any earlier date on which the Board of Directors of the Company determines not to apply the Net Cash Proceeds in accordance with the preceding paragraph is a “Net Proceeds Offer Trigger Date.” When the aggregate Net Proceeds Offer Amount is equal to or exceeds $25.0 million, the Company must make an offer to purchase (the “Net Proceeds Offer”) on a date that is not less than 30 days nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, from
(a) all Holders of Notes and
(b) all holders of other than Subordinated Debt or other obligations or liabilities Indebtedness (“Other Indebtedness”) that (x) is not, by its terms, expressly subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, Notes and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.
Appears in 1 contract
Sources: Supplemental Indenture
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make and the Guarantor shall not, and shall not permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company, the Guarantor or a Restricted Subsidiary of the Company or the Guarantor, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Valueequal to the fair market value of the assets or Equity Interests issued or sold or otherwise disposed of;
(2) such fair market value is determined by the Company's or the Guarantor's Board of Directors, as the case may be, and evidenced by a resolution of such Board of Directors set forth in an Officers' Certificate delivered to the Trustee; and
(b3) at least 75% of the consideration therefor received by the Company Company, the Guarantor or its such Restricted Subsidiaries consists Subsidiary is in the form of cash cash, Cash Equivalents or Cash Equivalents; provided that for readily marketable securities. For purposes of this clause (2)Section 4.11, each of the following shall be considered cash or Cash Equivalentsdeemed to be cash:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's, the Guarantor's or such Restricted Subsidiary's most recent balance sheet sheet) of the Company, the Guarantor or in the footnotes thereto) any Restricted Subsidiary (other than Subordinated Debt or other obligations or contingent liabilities and liabilities that are by their terms subordinated in right of payment to the NotesNotes or the Guarantees) that are assumed by the transferee of the Company or a Restricted Subsidiary any such assets pursuant to operation of law or a customary novation agreement,agreement that releases the Company, the Guarantor or such Restricted Subsidiary from further liability;
(iib) Additional Assets,
(iii) instrumentsany securities, notes, securities notes or other obligations received by the Company Company, the Guarantor or any such Restricted Subsidiary from such transferee that are converted by the Company, the Guarantor or such Restricted Subsidiary from the purchaser that are promptlyinto cash, but in any event Cash Equivalents or readily marketable securities within 90 60 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, after receipt thereof (to the extent of the cash or cash, Cash Equivalents actually so received, or readily marketable securities received in that conversion); and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.
Appears in 1 contract
Sources: Indenture (Charter Communications Holdings Capital Corp)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make consummate any Asset Sale unless the following conditions are metunless:
(a1) the Asset Sale is for Company or any of its Restricted Subsidiaries, as the case may be, receives consideration at least equal to the Fair Market ValueValue (as determined at the time of contractually agreeing to such Asset Sale) of the Capital Stock, assets or property sold or otherwise disposed of pursuant to such Asset Sale; and
(b2) except in the case of a Permitted Asset Swap, at least 7575.0% of the consideration from such Asset Sale received by the Company or its such Restricted Subsidiaries consists Subsidiary, as the case may be, is in the form of cash or Cash EquivalentsEquivalents or Replacement Assets; provided provided, that for purposes of this clause (2), each of the following shall be considered cash or Cash Equivalentsamount of:
(iA) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt notes thereto for which internal financial statements are available immediately preceding such date or, if incurred or other obligations or liabilities subordinated in right of payment accrued subsequent to the Notesdate of such balance sheet, such liabilities that would have been reflected on the Company’s or such Restricted Subsidiary’s balance sheet or in the notes thereto if such incurrence or accrual had taken place on or prior to the date of such balance sheet in the good faith determination of the Company) of the Company or a any Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Notes) that are extinguished in connection with the transactions relating to such Asset Sale, or that are assumed by the transferee of any such assets, property or Capital Stock, in each case, pursuant to operation of law an agreement that releases or a customary novation agreement,indemnifies the Company or such Restricted Subsidiary, as the case may be, from further liability therefor;
(iiB) Additional Assets,
(iii) instrumentsany securities, notes, securities notes or other obligations or other assets or property received by the Company or such any Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, or by their terms are required to be satisfied for cash or Cash Equivalents (to the extent of the cash or Cash Equivalents actually so received), in each case within 180 days following the receipt thereof; and
(ivC) any Designated Non-Cash Noncash Consideration received by the Company or any of its Restricted Subsidiaries in such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this clause subclause (dC) that is at that time outstanding, not to exceed the greater of (x) $10.0 100.0 million per fiscal year and (y) $30.0 million in 5.0% of Total Assets, calculated at the aggregate since time of the Issue Date receipt of such Designated Noncash Consideration (with the Fair Market Value of each item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); shall each be deemed to be Cash Equivalents for the purposes of this clause (2). Notwithstanding the foregoing, the 75.0% limitation referred to in clause (2) of this Section 4.10(a) shall be deemed satisfied with respect to any Asset Sale in which the cash, Cash Equivalents and Replacement Assets portion of the consideration received therefrom, determined in accordance with the foregoing provision on an after-tax basis, if the proceeds before tax would have complied with the aforementioned 75.0% limitation.
(b) Within 365 days after the Company’s or any Restricted Subsidiary’s receipt of the Net Cash Proceeds of any Asset Sale, the Company or a Restricted Subsidiary, at its option, may apply an amount equal to the Net Cash Proceeds from such Asset Sale (or any portion thereof) as follows:
(1) to repay, prepay, defease, redeem, reduce, purchase or otherwise retire (and to correspondingly reduce commitments with respect thereto in the case of revolving borrowings): (x) Indebtedness or other Obligations under the Senior Credit Facility or the Ex-Im Credit Facility, (y) Indebtedness of the Company (other than any Disqualified Stock or Subordinated Obligations) that is secured by a Lien (other than Indebtedness owed to an Affiliate of the Company) or (z) Indebtedness of a Restricted Subsidiary (other than any Disqualified Stock or Guarantor Subordinated Obligations) that is secured by a Lien (other than Indebtedness owed to the Company or an Affiliate of the Company);
(2) in the case of an Asset Sale by a Restricted Subsidiary that is a Non-Guarantor Subsidiary, to repay, prepay, defease, redeem, reduce, purchase or otherwise retire (and to correspondingly reduce commitments with respect thereto in the case of revolving borrowings) Indebtedness of such Restricted Subsidiary or any other Restricted Subsidiary that is a Non-Guarantor Subsidiary;
(3) to repay, prepay, defease, redeem, reduce, purchase or otherwise retire (and to correspondingly reduce commitments with respect thereto in the case of revolving borrowings) any other Indebtedness of the Company (other than any Disqualified Stock or Subordinated Obligations) or Indebtedness of a Restricted Subsidiary (other than any Disqualified Stock or Guarantor Subordinated Obligations) (in each case other than Indebtedness owed to the Company or an Affiliate of the Company); provided that the Company shall equally and ratably reduce obligations under the Notes as provided under Section 3.01, through open market purchases (to the extent such purchases are at or above 100.0% of the principal amount thereof) or by making an offer (in accordance with the procedures set forth below for an Asset Sale Offer) to all Holders to purchase their Notes at 100.0% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, on the amount of Notes that would otherwise be prepaid;
(4) to make an investment in, purchase or otherwise acquire any one or more businesses, assets (other than working capital assets), properties or capital expenditures, in each case used or useful in a Similar Business or to make payments (including without limitation prepayments and progress payments) in connection with such investment, purchase or other acquisition; provided, that if such investment, purchase or acquisition is in the form of the acquisition of Capital Stock of a Person, such investment, purchase or acquisition results in such Person becoming a Restricted Subsidiary;
(5) to make an investment in, purchase or otherwise acquire any one or more businesses, assets (other than working capital assets) or properties that replace the businesses, assets and/or properties that are the subject to such Asset Sale; or
(6) any combination of the foregoing, provided, that the Company and its Subsidiaries will be deemed to have complied with the provisions described in clause (4) or (5) of this Section 4.10(b) if and to the extent that, within 365 days after the Company’s or any Restricted Subsidiary’s receipt of such Net Cash Proceeds, the Company or a Restricted Subsidiary, as applicable, has entered into and not abandoned or rejected a binding agreement to make an investment, purchase or other acquisition in compliance with the provision described in clause (4) or (5) of this Section 4.10(b), and that investment, purchase or other acquisition is thereafter completed within 180 days after the end of such 365-day period.
(c) Within 360 days after Notwithstanding the receipt foregoing, to the extent that repatriation to the United States of any or all of the Net Cash Proceeds from an of any Asset SaleSales by a Foreign Subsidiary (x) is prohibited or delayed by applicable local law or (y) would have a material adverse tax consequence (taking into account any foreign tax credit or other net benefit actually realized in connection with such repatriation that would not otherwise be realized), as determined by the Company in its sole discretion, the portion of such Net Cash Proceeds so affected will not be required to be applied in compliance with this covenant, and such amounts may be retained by the applicable Foreign Subsidiary; provided that clause (x) of this paragraph shall apply to such amounts so long, but only so long, as the applicable local law will not permit repatriation to the United States (the Company hereby agreeing to use commercially reasonable efforts to cause the applicable Foreign Subsidiary to take all actions reasonably required by the applicable local law, applicable organizational impediments or other impediment to permit such repatriation), and if such repatriation of any of such affected Net Cash Proceeds is permitted under the applicable local law and is not subject to clause (y) of this paragraph, then, such repatriation will be promptly effected and such repatriated Net Cash Proceeds will be applied (net of additional taxes payable or reserved against as a result thereof) in compliance with this covenant. The time periods set forth in this covenant shall not start until such time as the Net Cash Proceeds may be used:repatriated (whether or not such repatriation actually occurs).
(id) to permanently repay Pending the final application of any such Net Cash Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Indebtedness (A) including under a revolving Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amountFacility) or (B) the Notes and otherwise invest or utilize such Net Cash Proceeds in any Debt secured manner not prohibited by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business this Indenture. Any amount of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided any Asset Sale that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated applied or invested as provided and within the time period set forth in Section 4.10(b) will be deemed to constitute “Excess Proceeds”; provided, that any amount of proceeds offered to Holders pursuant to clause (x3) of Section 4.10(b) or such binding commitment is terminated, pursuant to an Asset Sale Offer made at any time after the Net Cash Proceeds Asset Sale shall be deemed to have been applied as required and shall not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior without regard to the end of extent to which such offer is accepted by the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) Holders. When the aggregate amount of Net Cash Excess Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million 50.0 million, the Company will be required to make an offer (“Excess ProceedsAsset Sale Offer”)) to all Holders of Notes and, to the Issuers mustextent required by the terms of other Pari Passu Indebtedness, within 30 daysto all holders of other Pari Passu Indebtedness outstanding with similar provisions requiring the Company (or the Subsidiary Guarantor, as applicable) to make an offer to purchasepurchase such Pari Passu Indebtedness with the proceeds from any Asset Sale, in accordance with Section 3.02, Notes having a to purchase the maximum principal amount equal to:
(i) accumulated of Notes and any such Pari Passu Indebtedness to which the Asset Sale Offer applies that may be purchased out of the Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is at an offer price in cash in an amount equal to 100.0% of the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount Pari Passu Indebtedness plus accrued and unpaid interest to, to (but excluding not including) the date of purchase. If purchase (or such lesser price with respect to the Offer to Purchase is for less than all Pari Passu Indebtedness, if any, as may be provided by the terms of such Indebtedness), in accordance with the outstanding procedures set forth in this Indenture or the agreements governing the Pari Passu Indebtedness, as applicable.
(e) To the extent that the aggregate amount of Notes and Notes in an aggregate principal amount in excess of the purchase amount are Pari Passu Indebtedness so properly tendered and not withdrawn pursuant to an Asset Sale Offer is less than the offerExcess Proceeds, the Issuers shall purchase Notes having an Company may use any remaining Excess Proceeds (any such amount, “Retained Declined Proceeds”) for any purpose not prohibited by this Indenture. If the aggregate principal amount equal to of Notes surrendered by Holders thereof and other Pari Passu Indebtedness surrendered by Holders or lenders, collectively, exceeds the amount of Excess Proceeds, selection of Notes for purchase amount on a pro rata basis to the extent practicable, with adjustments will be made by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof accordance with respect to a PIK Note or the portion of a Global Note constituting PIK InterestSection 3.04(f). Upon completion of such Asset Sale Offer, the Offer to Purchase, amount of Excess Proceeds will shall be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.
Appears in 1 contract
Sources: Indenture (Viasat Inc)
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company's senior management or, in the case of an Asset Sale in excess of $5.0 million, the Board of Directors of the Company);
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of (x) cash or Cash Equivalents; provided , (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business or (z) Capital Stock in one or more Persons engaged in a Permitted Business that for purposes of this clause (2), each are or thereby become Restricted Subsidiaries of the following shall be considered cash or Cash Equivalents:
Company, and, in each case, such consideration is received at the time of such disposition; PROVIDED that the amount of (ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Securities) that are assumed by the transferee of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations securities received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 180 days after such Asset Sale (to the extent of the cash or Cash Equivalents actually so received, ) shall be deemed to be cash for the purposes of this provision only; and
(iviii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 390 days of receipt thereof either:
(A) to prepay any Designated Non-Indebtedness under the Credit Agreement or Indebtedness of a Restricted Subsidiary and, in the case of Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility (or effect a permanent reduction in availability under such revolving credit facility regardless of the fact that no prepayment is required);
(B) to make an Investment (x) in properties and assets that replace the properties and assets that were the subject of such Asset Sale, (y) in properties and assets that will be used by the Company or a Restricted Subsidiary in a Permitted Business or (z) permitted by clause (1) of the definition of Permitted Investments (collectively, "REPLACEMENT ASSETS"); or
(C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Pending the final application of the Net Cash Consideration received Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Indebtedness or otherwise invest such Net Cash Proceeds in any manner not prohibited by this Indenture. On the 391st day after an Asset Sale or such earlier date, if any, as the senior management or the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each, a "NET PROCEEDS OFFER TRIGGER DATE"), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each a "NET PROCEEDS OFFER AMOUNT") shall be applied by the Company or such Restricted Subsidiary in to make an offer to purchase (the Asset Sale having an aggregate Fair Market Value"NET PROCEEDS OFFER") on a date (the "NET PROCEEDS OFFER PAYMENT Date") not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, taken together with from all other Designated Non-Cash Consideration received pursuant Holders on a pro rata basis, that amount of Securities equal to this clause (d) that is the Net Proceeds Offer Amount at that time outstanding, not a price equal to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in 100% of the aggregate since the Issue Date (with the Fair Market Accreted Value of each item the Securities to be purchased, plus accrued and unpaid interest thereon, if any, to the date of Designated Non-Cash Consideration being measured at purchase; PROVIDED, HOWEVER, that if the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after Company is required by the receipt terms of any PARI PASSU Indebtedness of the Company, such Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds Offer may be used:
(i) made ratably to permanently repay (A) Debt outstanding under purchase the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by Securities and such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business other Indebtedness of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of ranks PARI PASSU with the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360Securities. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this Section. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from an one or more Asset Sale for general corporate purposes Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $10.0 million, shall be applied as required pursuant to the end second preceding paragraph). In the event of the 360-day period referred transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the first sentence successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section, and shall comply with the provisions of clause (iii) of this Section 4.09(c).
(d) When with respect to such deemed sale as if it were an Asset Sale. In addition, the aggregate amount fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from Asset Sales not applied for purposes of this Section 4.17. Notice of each Net Proceeds Offer pursuant to (this Section 4.17 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and within materials necessary to enable such Holders to tender Securities pursuant to the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), Net Proceeds Offer and shall state the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal tofollowing terms:
(i) accumulated Excess Proceedsthat Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to proration as hereinafter described in the -75- event the Net Proceeds Offer is oversubscribed) in integral multiples of $1,000 principal amount at maturity, multiplied byat the applicable purchase price;
(ii) a fraction (x) that the numerator of which Net Proceeds Offer is equal being made pursuant to this Section 4.17 and that all Securities tendered will be accepted for payment; PROVIDED, HOWEVER, that if the outstanding aggregate principal amount of Securities tendered in the Notes and (y) Net Proceeds Offer exceeds the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on Net Proceeds Offer Amount, the Collateral ranking pari passu with Company shall select the Liens on the Collateral securing the Notes similarly required Securities to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount purchased on a pro rata PRO RATA basis to the extent practicable, (based on amounts tendered) (with such adjustments as may be deemed appropriate by the Company so that only Notes Securities in multiples denominations of $1,000 principal amount at maturity, or integral multiples thereof, shall be purchased);
(iii) the purchase price (including the amount of accrued interest, if any) and the purchase date (which shall be no earlier than 30 days nor later than 60 days from the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(iv) that any Security not tendered will continue to accrete Accreted Value or accrue interest, as the case may be;
(v) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(vi) that Holders electing to have a Security purchased pursuant to the Net Proceeds Offer will be required to surrender the Security, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Offer Payment Date;
(vii) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Security the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; and
(viii) that Holders whose Securities are purchased only in part will be issued new Securities in a minimum principal amount at maturity equal to the unpurchased portion of the Securities surrendered. On or before the Net Proceeds Offer Payment Date, the Company shall (i) accept for payment Securities or portions thereof tendered pursuant to the Net Proceeds Offer, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus -76- accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers' Certificate stating the Securities or portions thereof being purchased 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, plus accrued interest, if any, thereon set forth in the notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company to the Holder thereof. For purposes of this Section 4.17, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect the Securities tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.17, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.17 by virtue thereof. The provisions of such conflictthis Section and other provisions contained in this Indenture relating to the Company's obligation to make a Net Proceeds Offer may be waived or modified with the written consent of the Holders of a majority in principal amount at maturity of the Securities.
Appears in 1 contract
Sources: Indenture (Salt Holdings Corp)
Limitation on Asset Sales. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s Board of Directors);
(b2) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or and/or Cash EquivalentsEquivalents and is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or any such Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Notes or any Guarantee of a Guarantor) that are assumed by the transferee of any such assets shall be deemed to be cash for purposes of this provision; and
(3) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 365 days of receipt thereof either:
(a) to permanently reduce (i) Senior Debt of the Company or a Guarantor, (ii) any other Indebtedness which is secured by a Lien on the assets which are the subject of such Asset Sale or (iii) in the case of a Restricted Subsidiary pursuant to operation of law the Company which is not a Guarantor, any other Indebtedness of such Restricted Subsidiary or a customary novation agreement,its Subsidiaries;
(iib) Additional to make an investment in properties and assets that replace the properties and assets that were the subject of such Asset Sale or in properties and assets (including Capital Stock) that will be used in the business of the Company and its Restricted Subsidiaries as existing on the Issue Date or in businesses similar, ancillary, complementary or reasonably related thereto (“Replacement Assets,”); and/or
(iiic) instrumentsa combination of prepayment and investment permitted by the foregoing clauses (3)(a) and (3)(b); provided however, notes, securities or other obligations received that the requirements of Section 4.6(a)(3) will not apply to sales by the Company or any of its Restricted Subsidiaries of any of the Excluded Assets.
(b) Pending the final application of such Net Cash Proceeds, the Company may temporarily reduce borrowings under the Credit Agreement or any other revolving credit facility. On the 365th day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary from determines not to apply the purchaser that are promptlyNet Cash Proceeds relating to such Asset Sale as set forth in Section 4.6(a)(3)(a), but (b) and (c) (each a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in any event within 90 days clauses Section 4.6(a)(3)(a), (b) and (c) of the closing, converted preceding paragraph (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary to cash or Cash Equivalentsmake an offer to purchase (the “Net Proceeds Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, to the extent from all holders of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with Pari Passu Indebtedness (to the Liens securing extent the terms of such Pari Passu Indebtedness so require) on a pro rata basis, that amount of Notes and Pari Passu Indebtedness equal to the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Notes (and Pari Passu Indebtedness to be purchased, plus accrued and unpaid interest thereon, if any) through making the Offer , to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitmentpurchase; provided however, that (x) such investment is consummated within 180 days of the end of the 360if at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof shall be applied in accordance with this covenant.
(c) The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of €10.0 million resulting from an one or more Asset Sale for general corporate purposes Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of €10.0 million, shall be applied as required pursuant to the end of the 360-day period referred to in the first sentence of this Section 4.09(cparagraph).
(d) When In the aggregate amount event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this covenant, and shall comply with the provisions of this covenant with respect to such deemed sale as if it were an Asset Sale. In addition, the fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:for purposes of this covenant.
(ie) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal Each Net Proceeds Offer will be mailed to the outstanding aggregate principal amount Holders within 25 days following the Net Proceeds Offer Trigger Date, with a copy to the Trustee. Upon receiving notice of the Net Proceeds Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of €1,000 in exchange for cash. To the extent Holders properly tender Notes and (y) the denominator holders of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes Pari Passu Indebtedness properly tender Pari Passu Indebtedness in an aggregate principal amount in excess of exceeding the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer Amount, the Issuers shall purchase tendered Notes having an aggregate principal amount equal to the purchase amount and Pari Passu Indebtedness will be purchased on a pro rata basis to (based on amounts tendered). A Net Proceeds Offer shall remain open for a period of 20 business days or such longer period as may be required by law. If any Net Cash Proceeds remain after the extent practicableconsummation of any Net Proceeds Offer, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess may use those Net Cash Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. Upon completion of each Net Proceeds Offer, the amount of Net Cash Proceeds will be reset at zero.
(f) The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the “Asset Sale” provisions of this Section 4.09 or Section 3.024.6, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under the “Asset Sale” provisions of this this Section 4.09 or Section 3.02 4.6 by virtue of such conflictthereof.
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall not, and shall not cause or permit any of its Restricted Subsidiary Subsidiaries to, make any complete an Asset Sale unless the following conditions are metunless:
(a1) the Asset Sale is for Company or such applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least equal to the Fair Market Value; andValue of the assets sold or otherwise disposed of;
(b2) at least not less than 75% of the consideration received by the Company or its such applicable Restricted Subsidiaries consists Subsidiary, as the case may be, is in the form of (A) cash or Cash Equivalents; provided that for purposes , or (B) Replacement Assets, and in each case set forth in subclauses (A) and (B) of this clause (2a)(2), each is received at the time of such sale or other disposition; provided, that the following shall be considered cash or Cash Equivalents:
amount of (i) the assumption by the purchaser of any Debt or other obligations or liabilities (that would appear as shown liabilities on the Company’s most recent a balance sheet or prepared in the footnotes thereto) accordance with GAAP (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the NotesDebt) of the Company or a any such applicable Restricted Subsidiary pursuant to operation of law that is actually assumed by the transferee in such Asset Sale (or a customary novation agreement,
third party on behalf of the transferee) and from which the Company or such applicable Restricted Subsidiaries are fully and unconditionally released, and (ii) Additional Assets,
(iii) instruments, notes, any securities or other obligations notes received by the Company or any such applicable Restricted Subsidiary from the purchaser that which are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents within 180 days of such Asset Sale (to the extent of the cash or Cash Equivalents actually so received), will be deemed to be cash for purposes of this clause (a)(2) and to have been received at the time of such sale; and
(ivb) any Designated Non-Cash Consideration The Asset Sale Proceeds received by the Company or such Restricted Subsidiary Subsidiary, as the case may be, may be applied, at the option of the Company or such Restricted Subsidiary:
(1) if the assets subject of such Asset Sale constitute Notes Priority Lien Collateral, (i) first, to prepay, repay or purchase (or offer to prepay, repay or purchase, as applicable) any Priority Lien Obligations on a pro rata basis; and (ii) second, to prepay, repay or purchase (or offer to prepay, repay or purchase, as applicable) any Subordinated Lien Obligations on a pro rata basis; provided, that any repayment, prepayment or purchase of (or offer to prepay, repay or purchase) obligations under the PIK Toggle Notes shall be made as provided under Section 4.01, through open-market purchases (to the extent such purchases are at or above 100% of the principal amount thereof plus accrued unpaid interest) or by making an offer (in accordance with the procedures set forth below for an Excess Proceeds Offer) to all Holders of PIK Toggle Notes to purchase their PIK Toggle Notes at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, on the amount of PIK Toggle Notes that would otherwise be purchased;
(2) if the assets subject of such Asset Sale do not constitute Notes Priority Lien Collateral, to prepay, repay or purchase (or offer to prepay, repay or purchase, as applicable) indebtedness under any Credit Facilities or any other secured Debt of the Company (including the PIK Toggle Notes) or any Restricted Subsidiary; provided, that any repayment, prepayment or purchase of (or offer to prepay, repay or purchase) obligations under the PIK Toggle Notes shall be made as provided under Section 4.01, through open-market purchases (to the extent such purchases are at or above 100% of the principal amount thereof plus accrued unpaid interest) or by making an offer (in accordance with the procedures set forth below for an Excess Proceeds Offer) to all Holders of PIK Toggle Notes to purchase their PIK Toggle Notes at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, on the amount of PIK Toggle Notes that would otherwise be purchased; or
(3) to make capital expenditures or to make an investment in properties and assets that are used or useful in the business of the Company or its Restricted Subsidiaries or in businesses reasonably similar to or ancillary to the business of the Company or its Restricted Subsidiaries as conducted at the time of such Asset Sale (including the acquisition of Capital Stock of any such business or businesses); provided, that (i) the Consolidated Secured Leverage Ratio calculated as of the last day of the most recently ended quarter prior to the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant for which financial statements are required to this clause be delivered does not exceed 2.5 to 1.0; and (dii) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and such investment occurs, or (y) $30.0 million the Company or any such Restricted Subsidiary enters into contractual commitments to so apply such Asset Sale Proceeds, subject only to customary conditions other than the obtaining of financing, in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 case, within 365 days after following the receipt of any Net Cash such Asset Sale Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the any commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (iiy) or (iii) above shall be treated as a permitted application of above, the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is transactions contemplated thereby are consummated within 180 days of the end date such commitment is entered into); provided, further, to the extent Asset Sale Proceeds of Collateral are used to acquire additional assets, such additional assets (other than, for avoidance of doubt, Excluded Assets) are pledged subject to the Intercreditor Agreement and the Collateral Trust Agreement, as Collateral for the benefit of the 360-day period referred Collateral Trustee, the Trustee and the Holders of PIK Toggle Notes. Pending any such reinvestment (x) Asset Sale Proceeds of Notes Priority Lien Collateral shall, as promptly as practicable, subject to the Intercreditor Agreement, be deposited in a Noteholder Proceeds Collateral Account pledged as Notes Priority Lien Collateral for the first sentence benefit of this paragraph the Priority Lien Obligations, Subordinated Lien Obligations and ABL Debt Obligations in accordance with the Intercreditor Agreement and the Collateral Trust Agreement, and (y) if such acquisition is not consummated within Asset Sale Proceeds of ABL Priority Lien Collateral shall, as promptly as practicable, subject to the period set forth Intercreditor Agreement, be deposited in clause (x) a deposit account or such binding commitment is terminatedsecurities account pledged as ABL Priority Lien Collateral for the benefit of the ABL Debt Obligations, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof Priority Lien Obligations and Subordinated Lien Obligations in accordance with this Section 4.09, the Company or Intercreditor Agreement and the Collateral Trust Agreement. If on the 45th day following any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to or the end of 365th day if the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, Consolidated Secured Leverage Ratio calculated in accordance with Section 3.0210.09(b)(3)(i) does not exceed 2.5 to 1.0), Notes having a principal the Available Asset Sale Proceeds exceed $7,500,000, the Company will apply an amount equal to:
to such Available Asset Sale Proceeds to an offer to repurchase (i) accumulated Excess Proceeds, multiplied by
the PIK Toggle Notes and (ii) at its option, other Secured Debt, in each case at a fraction (x) the numerator of which is purchase price in cash equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount of the PIK Toggle Notes and such other Secured Debt, plus accrued interest toand unpaid interest, but excluding if any, to the purchase date of purchase. If (an "Excess Proceeds Offer"); provided, that if the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are PIK Toggle Notes (and other Secured Debt, if applicable) tendered and not withdrawn pursuant to the offerExcess Proceeds Offer exceeds the Available Asset Sale Proceeds, the Issuers Company shall purchase (i) first repurchase the tendered Priority Lien Debt before any Subordinated Lien Debt is repurchased and (ii) select PIK Toggle Notes having an aggregate principal amount equal to the purchase amount be repurchased on a pro rata basis to basis, by lot or in such other manner as the extent practicable, with adjustments by Trustee shall determine. The Company may satisfy the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof foregoing obligations with respect to a PIK Note or any such Available Asset Sale Proceeds by making an Excess Proceeds Offer with respect to such Available Asset Sale Proceeds prior to the portion of a Global Note constituting PIK Interest). Upon completion expiration of the Offer relevant 45-day period (or such longer period provided above) or with respect to Purchase, Available Asset Sale Proceeds of less than $7,500,000. If an Excess Proceeds will be reset at zeroOffer is not fully subscribed, the Company may retain and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used use for general corporate purposes or any purpose not otherwise prohibited by this IndentureIndenture the portion of the Available Asset Sale Proceeds not required to repurchase PIK Toggle Notes (or other Secured Debt, if applicable). Upon completion of any Excess Proceeds Offer, the amount of Available Asset Sale Proceeds shall be reset to zero.
(c) If the Company is required to make an Excess Proceeds Offer, the Company shall mail, within 30 days of the 45th day following the receipt of Available Asset Sale Proceeds (or the 365th day if the Consolidated Secured Leverage Ratio calculated in accordance with Section 10.09(b)(3)(i) does not exceed 2.5 to 1.0) exceeding $7,500,000 as specified in Section 10.09(b), a notice to the Holders, at the address appearing in the Register maintained by the Registrar, with a copy to the Trustee, stating the information set forth below. The Issuers notice, which shall govern the terms of the Excess Proceeds Offer, shall state:
(1) that the Company is offering to apply the Available Asset Sale Proceeds to repurchase PIK Toggle Notes at a purchase price in cash equal to 100% of the principal amount of the PIK Toggle Notes, plus accrued and unpaid interest, if any, to the purchase date;
(2) the purchase date (which shall be no earlier than 30 days nor later than 60 days from the date such notice is mailed);
(3) the instructions that each Holder must follow in order to have PIK Toggle Notes purchased, which shall be reasonable and customary for transactions of this nature; and
(4) the calculations used in determining the amount of Available Asset Sale Proceeds to be applied to the purchase of PIK Toggle Notes. The Company shall comply with the requirements of 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 connection with the purchase repurchase of the PIK Toggle Notes pursuant to in connection with an Offer to Purchase pursuant to this Section 4.09Excess Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with this Section 4.09 or Section 3.0210.09, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed not to have breached their its obligations under this Section 4.09 or Section 3.02 10.09 by virtue of such conflictcompliance.
Appears in 1 contract
Limitation on Asset Sales. (A) The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s Board of Directors);
(b2) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash cash, Cash Equivalents or Cash EquivalentsReplacement Assets and shall be received at the time of such disposition; provided that for purposes of this clause (2), each of the following shall be considered cash or Cash Equivalentsthat:
(ia) the assumption by the purchaser amount of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet sheet) of the Company or in the footnotes thereto) any such Restricted Subsidiary (other than Subordinated Debt or other obligations or liabilities that are by their terms subordinated in right of payment to the NotesNotes or any Guarantee of a Guarantor) that are assumed by the transferee of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,any such assets, and
(iib) Additional Assets,
(iii) instruments, notes, the fair market value of any securities or other obligations assets received by the Company or any such Restricted Subsidiary in exchange for any such assets that are converted into cash within 180 days after such Asset Sale, shall be deemed to be cash for purposes of this provision; and
(3) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 365 days of receipt thereof (provided that if the Company or such Restricted Subsidiary, as the case may be, has entered into an agreement in definitive form to so apply such Net Cash Proceeds, the transaction contemplated by such agreement must be consummated within the later of such 365 day period and 120 days from the purchaser that are promptly, but in any event within 90 days date of the closingexecution of such agreement) either:
(a) to repay any Obligations under the Credit Agreements or any Guarantor Senior Debt and, converted in the case of any such Indebtedness under a revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility;
(b) to make an investment in properties and assets that replace the properties and assets that were the subject of such Asset Sale or in properties and assets (including Capital Stock) that will be used in the business of the Company and its Restricted Subsidiaries as existing on the Issue Date or in businesses reasonably related thereto (“Replacement Assets”) and to the extent that the assets that were the subject of such Asset Sale constituted Collateral such Replacement Assets shall also be required to constitute Collateral; and/or
(c) a combination of repayment and investment permitted by the foregoing clauses (3)(a) and (3)(b).
(B) Pending the final application of such Net Cash Proceeds, the Company may temporarily reduce borrowings under the Credit Agreements or any other revolving credit facility, if any. On the 366th day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (3)(a), (3)(b) and (3)(c) of paragraph (A) above, or, in the event that a definitive agreement has been entered into prior to such 366th day pursuant to which the Net Cash Proceeds are to be applied, on the later of the 366th day and the 121st day after the execution of such agreement (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (3)(a), (3)(b) and (3)(c) of the preceding paragraph (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary to cash or make an offer to purchase (the “Net Proceeds Offer”) to all Holders and (x) in the case of Net Cash EquivalentsProceeds which are received as a result of an Asset Sale of Collateral, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received required pursuant to this clause (d) that is at that time outstandingthe documentation governing any Pari Passu Junior Lien Obligations, not an offer to exceed (x) $10.0 million per fiscal year purchase to the holders of such Pari Passu Junior Lien Obligations and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of Net Cash Proceeds which are not received as a result of an Asset Sale of Collateral, to the repayment extent required by the terms of any Pari Passu Debt, an offer to purchase to all holders of such Pari Passu Debt, on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, from all Holders (and, if applicable, holders of any such Pari Passu Junior Lien Obligations or Pari Passu Debt) on a pro rata basis, that amount of Notes (and, if applicable, Pari Passu Junior Lien Obligations or Pari Passu Debt) equal to the Net Proceeds Offer Amount at a price equal to 100% of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing principal amount of the Notes (and, if applicable, Pari Passu Junior Lien Obligations or Pari Passu Debt) to be purchased, plus accrued and unpaid interest thereon, if any) through making the Offer , to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that purchase.
(xC) such investment is consummated within 180 days of the end of the 360If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.10.
(D) The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $15.0 million resulting from one or more Asset Sales (at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in excess of $15.0 million, shall be applied as required pursuant to this Section 4.10).
(E) In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this covenant, and shall comply with the provisions of this covenant with respect to such deemed sale as if it were an Asset Sale. In addition, the fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this Section 4.10.
(F) If any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under remain after the consummation of any revolving credit facility) prior to Net Proceeds Offer, the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Company may use such Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this IndentureIndenture without regard to this Section 4.10. Upon completion of each Net Proceeds Offer, the Net Proceeds Offer Amount will be reset at zero.
(G) In the event the Company or any of its Restricted Subsidiaries consummate a single Asset Sale for which the Company or its Restricted Subsidiaries receive aggregate consideration at the time of such Asset Sale in excess of $100.0 million, the Company or such Restricted Subsidiary, as the case may be, shall, prior to the consummation thereof, obtain a favorable opinion as to the fairness of such Asset Sale to the Company or the relevant Restricted Subsidiary, as the case may be, from a financial point of view, from an Independent Financial Advisor and file the same with the Trustee.
(H) Notwithstanding paragraphs (A) and (B) of this Section 4.10, the Company and its Restricted Subsidiaries will be permitted to enter into and consummate an Asset Swap without complying with such paragraphs to the extent that:
(1) at the time of entering into such Asset Swap or immediately after giving effect to such Asset Swap, no Default or Event of Default shall have occurred or be continuing or would occur as a consequence thereof;
(2) in the case of any Asset Swap of Collateral, the assets received by the Company and its Restricted Subsidiaries constitute Collateral; and
(3) in the event that such Asset Swap involves an aggregate amount in excess of $10.0 million, a majority of the members of the Board of Directors of the Company shall have approved the terms of such Asset Swap and determined that the consideration received in such Asset Swap is at least equal to the fair market value of the assets disposed of in such Asset Swap.
(I) The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with this Section 4.09 or Section 3.024.10, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.10 by virtue of such conflictthereof.
Appears in 1 contract
Sources: Indenture (Dole Food Co Inc)
Limitation on Asset Sales. The Company shall not, and shall not cause or permit any Restricted Subsidiary to, directly or indirectly, make any Asset Sale Sale, unless the following conditions are met:
(ax) the Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least equal to the Fair Market Value; and
Value of the assets sold or otherwise disposed of and (by) at least 75% of such consideration consists of (i) cash or Cash Equivalents, (ii) Replacement Assets, (iii) publicly traded Equity Interests of a Person who is engaged primarily in a Telecommunications Business; provided, however, that the Company or such Restricted Subsidiary shall sell (a "Monetization Sale"), for cash or Cash Equivalents, such Equity Interests to a third Person (other than to the Company or a Subsidiary thereof) at a price not less than the Fair Market Value thereof within 365 days of the consummation of such Asset Sale, or (iv) any combination of the foregoing clauses (i) through (iii). The amount of any (x) Indebtedness (other than any Subordinated Indebtedness) of the Company or any Restricted Subsidiary that is actually assumed by the transferee in such Asset Sale and from which the Company and the Restricted Subsidiaries are fully released shall be deemed to be cash for purposes of determining the percentage of cash consideration received by the Company or its such Restricted Subsidiaries consists Subsidiary, (y) notes or other similar obligations received by the Company or any Restricted Subsidiary from such transferee that are immediately converted, sold or exchanged (or are converted, sold or exchanged within 365 days of the related Asset Sale) by the Company or any Restricted Subsidiary into cash shall be deemed to be cash, in an amount equal to the net cash proceeds realized upon such conversion, sale or Cash Equivalents; provided that exchange for purposes of this clause (2), each determining the percentage of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations consideration received by the Company or such Restricted Subsidiary and (z) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Sale, if the Company and all of its Restricted Subsidiaries immediately are released from all guarantees of payment of such Indebtedness is no longer the purchaser that are promptly, but in any event within 90 days liability of the closing, converted by the Company or such any of its Restricted Subsidiary Subsidiaries shall be deemed to be cash or Cash Equivalents, to for purposes of determining the extent percentage of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Subsidiary. Any Net Cash Proceeds from an any Asset Sale, the Net Cash Proceeds may be used:
(i) Sale or any Monetization Sale that are not invested in Replacement Assets or used to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to and permanently reduce the commitment thereunder by such amount) or (B) the Notes and commitments under Indebtedness of any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated Subsidiary within 180 365 days of the end consummation of the 360-day period referred such Asset Sale or Monetization Sale shall constitute "Excess Proceeds" subject to in the first sentence disposition as provided below. Pending final application of this paragraph and (y) if any such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09Proceeds, the Company or any Restricted Subsidiary that is a borrower under Qualified Subsidiary Indebtedness may use any temporarily reduce revolving credit borrowings or otherwise invest such Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to manner that is not prohibited by the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When Indenture. Within 40 days after the aggregate amount of Net Cash Excess Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) equals or exceeds $25.0 million (“Excess Proceeds”)10.0 million, the Issuers must, within 30 days, Company shall make an offer Offer to purchasePurchase, in accordance with Section 3.02from all Holders on a pro rata basis, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding that aggregate principal amount of Securities as can be purchased with the Notes and (y) the denominator Note Portion of which is Excess Proceeds at a price in cash equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess thereof, plus accrued and unpaid interest, if any, to any purchase date. To the extent that the aggregate amount of the purchase amount are principal and accrued interest of Securities validly tendered and not withdrawn pursuant to an Offer to Purchase is less than the offerExcess Proceeds, the Issuers shall purchase Notes having an Company may use such surplus for general corporate purposes. If the aggregate amount of principal and accrued interest of Securities validly tendered and not withdrawn by Holders thereof exceeds the amount of Securities that can be purchased with the Note Portion of Excess Proceeds, Securities to be purchased will be selected pro rata based on the aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments of Securities tendered by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest)each Holder. Upon completion of the an Offer to Purchase, the amount of Excess Proceeds will with respect to the applicable Asset Sale or Monetization Sale shall be reset at to zero. In the event that any other Indebtedness of the Company that ranks pari passu with the Securities (the "Other Debt") requires an offer to purchase to be made to repurchase such Other Debt upon the consummation of an Asset Sale, and any the Company may apply the Excess Proceeds remaining after consummation of the Offer otherwise required to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant applied to an Offer to Purchase to offer to purchase such Other Debt and to an Offer to Purchase so long as the amount of such Excess Proceeds applied to purchase the Securities is not less than the Note Portion of Excess Proceeds. With respect to any Excess Proceeds, the Company shall make the Offer to Purchase in respect thereof at the same time as the analogous offer to purchase is made pursuant to this Section 4.09. To any Other Debt and the extent that Purchase Date in respect thereof shall be the provisions of same as the purchase date in respect thereof pursuant to any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflictOther Debt.
Appears in 1 contract
Limitation on Asset Sales. The Company shall will not, and shall will not cause or permit any of its Restricted Subsidiary Subsidiaries to, directly or indirectly, make any Asset Sale Sale, unless the following conditions are met:
(ai) the Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least equal to the Fair Market Value; and
Value of the assets sold or otherwise disposed of and (bii) at least 7585% of such consideration consists of (A) cash or Cash Equivalents, (B) properties and assets to be used in the business of the Company and its Restricted Subsidiaries and/or (C) Equity Interests in any Person which thereby becomes a Wholly-Owned Restricted Subsidiary of the Company. The amount of any (i) Indebtedness (other than any subordinated Indebtedness) of the Company or any Restricted Subsidiary of the Company that is actually assumed by the transferee in such Asset Sale and from which the Company and the Restricted Subsidiaries of the Company are fully released shall be deemed to be cash for purposes of determining the percentage of cash consideration received by the Company or any of its Restricted Subsidiaries consists of cash or Cash Equivalents; provided that for purposes of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
and (ii) Additional Assets,
(iii) instruments, notes, securities notes or other similar obligations received by the Company or any of its Restricted Subsidiaries from such Restricted Subsidiary from the purchaser transferee that are promptlyimmediately converted, but in any event sold or exchanged (or are converted, sold or exchanged within 90 thirty days of the closingrelated Asset Sale) by the Company or any of its Restricted Subsidiaries into cash shall be deemed to be cash, converted in an amount equal to the net cash proceeds realized upon such conversion, sale or exchange, for purposes of determining the percentage of cash consideration received by the Company or any of its Restricted Subsidiaries. In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Article Five and as a result thereof the Company is no longer an obligor on the Securities, the successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.07, and shall comply with the provisions of this Section 4.07 with respect to such deemed sale as if it were an Asset Sale. In addition, the Fair Market Value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this Section 4.07. The Company or such Restricted Subsidiary, as the case may be, may (i) apply the Net Cash Proceeds of any Asset Sale within 365 days of receipt thereof to repay Specified Senior Indebtedness of the Company or such Restricted Subsidiary and permanently reduce any related commitment, or (ii) commit in writing to cash acquire, construct or Cash Equivalentsimprove, or acquire, construct or improve, properties and assets to be used in the extent business of the cash or Company and its Restricted Subsidiaries and so apply such Net Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 Proceeds within 365 days after the receipt of any Net Cash Proceeds from an Asset Sale, thereof. To the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) extent all or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application part of the Net Cash Proceeds from the date of any Asset Sale are not applied within 365 days of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth Asset Sale as described in clause (xi) or (ii) of the immediately preceding paragraph (such binding commitment is terminatedNet Cash Proceeds, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below"UNUTILIZED NET CASH PROCEEDS"). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers mustshall, within 30 days20 days after such 365th day, make an offer Offer to purchase, in accordance with Section 3.02, Notes having Purchase all outstanding Securities up to a maximum principal amount (expressed as a multiple of $1,000) of Securities equal to:
(i) accumulated Excess to such Unutilized Net Cash Proceeds, multiplied by
(ii) at a fraction (x) the numerator of which is purchase price in cash equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof, plus accrued and unpaid interest tothereon, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant if any, to the offerPurchase Date; PROVIDED, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicableHOWEVER, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used deferred until there are aggregate Unutilized Net Cash Proceeds equal to or in excess of $10.0 million, at which time the entire amount of such Unutilized Net Cash Proceeds, and not just the amount in excess of $10.0 million, shall be applied as required pursuant to this paragraph. With respect to any Offer to Purchase effected pursuant to this Section 4.07, among the Securities, to the extent the aggregate principal amount of Securities tendered pursuant to such Offer to Purchase exceeds the Unutilized Net Cash Proceeds to be applied to the repurchase thereof, such Securities shall be purchased PRO RATA based on the aggregate principal amount of such Securities tendered by each Holder. To the extent the Unutilized Net Cash Proceeds exceed the aggregate amount of Securities tendered by the Holders of the Securities pursuant to such Offer to Purchase, the Company may retain and utilize any portion of the Unutilized Net Cash Proceeds not applied to repurchase the Securities for any purpose not otherwise prohibited by consistent with the other terms of this Indenture. The Issuers shall comply with In the requirements of Rule 14e-1 under event that the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase of the Notes pursuant to Company makes an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02Securities, the Issuers Company shall comply with the any applicable securities laws and regulations regulations, including any applicable requirements of Section 14(e) of, and Rule 14e-1 under, the Exchange Act, and any violation of the provisions of this Indenture relating to such Offer to Purchase occurring as a result of such compliance shall not be deemed a Default or an Event of Default. Each Holder shall be entitled to have breached their obligations under this Section 4.09 tender all or Section 3.02 any portion of the Securities owned by virtue such Holder pursuant to the Offer to Purchase, subject to the requirement that any portion of such conflicta Security tendered must be tendered in an integral multiple of $1,000 principal amount and subject to any proration among tendering Holders as described above.
Appears in 1 contract
Sources: Indenture (Metris Direct Inc)
Limitation on Asset Sales. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of such Asset Sale is for at least Fair Market Valueequal to the fair market value of the assets or Equity Interests issued or sold or otherwise disposed of, as approved in good faith by the Company’s Board of Directors; and
(b2) at least 75% of the consideration therefor received by the Company or its such Restricted Subsidiaries consists Subsidiary is in the form of cash or Cash Equivalents; provided that for . For purposes of this clause provision only (2and specifically not for the purposes of the definition of “Net Proceeds”), each of the following shall be considered cash or Cash Equivalentsdeemed to be cash:
(i) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than contingent liabilities and liabilities that are by their terms subordinated to operation the Notes or any Subsidiary Guarantee) that are assumed by the transferee of law or a customary novation agreement,any such assets; and
(ii) Additional Assets,
(iii) instrumentsany securities, notes, securities notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, are converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received, received in that conversion); and
(iviii) the fair market value of (x) any Designated Non-Cash Consideration assets (other than securities or current assets) received by the Company or such any Restricted Subsidiary that will be used or useful in the Asset Sale having an aggregate Fair Market Valuea Related Business, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (dy) Equity Interests in a Person that is at a Restricted Subsidiary or in a Person engaged in a Related Business that time outstanding, not to exceed shall become a Restricted Subsidiary immediately upon the acquisition of such Equity Interests by the Company or the applicable Restricted Subsidiary or (z) a combination of (x) $10.0 million per fiscal year and (y); provided that the determination of the fair market value of assets or Equity Interests in excess of $50.0 million received in any transaction or series of related transactions shall be evidenced by an Officers’ Certificate delivered to the Trustee.
(b) $30.0 million in the aggregate since Within a period of 360 days (commencing after the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(cDate) Within 360 days before or after the receipt of any Net Cash Proceeds of any Asset Sale (provided that if during such 360-day period after the receipt of any such Net Proceeds the Company (or the applicable Restricted Subsidiary) enters into a definitive binding agreement committing it to apply such Net Proceeds in accordance with the requirements of clause (B), (D) or (E) of this paragraph after such 360th day, such 360-day period will be extended with respect to the amount of Net Proceeds so committed for a period not to exceed 120 days until such Net Proceeds are required to be applied in accordance with such agreement (or, if earlier, until termination of such agreement)), the Company or such Restricted Subsidiary, at its option, may apply an amount equal to the Net Proceeds from an such Asset Sale, the Net Cash Proceeds may be used:
(iA) to permanently repay repay, prepay, redeem or repurchase Indebtedness (Aother than securities) Debt outstanding under Credit Facilities or Indebtedness of a Restricted Subsidiary that is not a Guarantor (other than Indebtedness of such Restricted Subsidiary owed to the Credit Agreement (Company or any of its Restricted Subsidiaries) and, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the repayment of the availability under such revolving credit facility (or effect a permanent reduction in the availability under such revolving credit facility regardless of the Credit Agreement, fact that no prepayment is required in order to permanently reduce the commitment thereunder by such amount) or do so (in which case no prepayment shall be required));
(B) to acquire Equity Interests in a Person that is a Restricted Subsidiary or in a Person engaged in a Related Business that shall become a Restricted Subsidiary immediately upon the Notes and any Debt secured acquisition of such Equity Interests by Liens ranking pari passu with the Liens securing Company or the Notes (if any) through making the Offer to Purchase below,applicable Restricted Subsidiary;
(iiC) to make capital expenditures;
(D) to acquire Additional Assetsother assets (other than securities or current assets) that will be used or useful in a Related Business;
(E) to make Investments in Joint Ventures pursuant to clauses (13) and (14) of the definition of “Permitted Investments”; or
(iiiF) to make capital expenditures in a Permitted Business combination of prepayment and investment permitted by the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause foregoing clauses (iiA), (B), (C), (D) or and (iiiE).
(c) above shall be treated as a permitted Pending the final application of the such Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09Proceeds, the Company or any Restricted Subsidiary may use temporarily reduce borrowings under the Credit Facilities or any other revolving credit facility or Receivables Financings, if any, or otherwise invest such Net Proceeds in Cash Proceeds from Equivalents, in each case in a manner not prohibited by this Supplemental Indenture. Subject to the last sentence of this paragraph, on the 361st day (as extended pursuant to the provisions in Section 4.10(b)) after an Asset Sale for general corporate purposes or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Proceeds relating to such Asset Sale as set forth in clause (including A), (B), (C), (D), (E) or (F) of Section 4.10(b) (each, a reduction “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Proceeds which have not been applied (or committed to be applied pursuant to a definitive agreement as described in borrowings under Section 4.10(b)) on or before such Net Proceeds Offer Trigger Date as permitted in clause (A), (B), (C), (D), (E) or (F) of Section 4.10(b) (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary to make an offer to purchase (the “Net Proceeds Offer”) on the Purchase Date, from all Holders (and, if required by the terms of any revolving credit facilityother Indebtedness of the Company ranking pari passu with the Notes in right of payment and which has similar provisions requiring the Company either to make an offer to repurchase or to otherwise repurchase, redeem or repay such Indebtedness with the proceeds from Asset Sales (the “Pari Passu Indebtedness”), from the holders of such Pari Passu Indebtedness) prior on a pro rata basis (in proportion to the end respective principal amounts or accreted value, as the case may be, of the 360Notes and any such Pari Passu Indebtedness) an aggregate principal amount of Notes (plus, if applicable, an aggregate principal amount or accreted value, as the case may be, of Pari Passu Indebtedness) equal to the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Notes (or 100% of the principal amount or accreted value, as the case may be, of such Pari Passu Indebtedness), plus accrued and unpaid interest thereon, if any, to the Purchase Date; provided, however, that if at any time any non-day period referred cash consideration received by the Company or any Restricted Subsidiary, as the case may be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Proceeds thereof shall be applied in accordance with this covenant. The Company may defer the first sentence Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $50.0 million resulting from one or more Asset Sales (at which time the entire unutilized Net Proceeds Offer Amount, and not just the amount in excess of $50.0 million, shall be applied as required pursuant to this Section 4.09(cparagraph, and in which case the Net Proceeds Offer Trigger Date shall be deemed to be the earliest date that the Net Proceeds Offer Amount is equal to or in excess of $50.0 million).
(d) When To the extent that the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to the Notes (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)plus, if applicable, the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount or accreted value, as the case may be, of the Notes and (yany Pari Passu Indebtedness) the denominator of which tendered pursuant to a Net Proceeds Offer is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer Amount, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments Company may use such excess Net Proceeds Offer Amount for general corporate purposes or for any other purpose not prohibited by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest)this Supplemental Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer to Purchase, Excess Proceeds will Amount shall be reset at zero, and any Excess . A Net Proceeds remaining after consummation Offer shall remain open for a period of the Offer to Purchase 20 Business Days or such longer period as may be used for any purpose not otherwise prohibited required by this Indenture. law.
(e) The Issuers shall Company or the applicable Restricted Subsidiary, as the case may be, will comply with the requirements of 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 connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 4.10 or Section 3.023.04, the Issuers Company or such Restricted Subsidiary shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 Supplemental Indenture by virtue of such conflictthereof.
Appears in 1 contract
Sources: First Supplemental Indenture (Scotts Miracle-Gro Co)
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make and the Guarantor shall not, and shall not permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company, the Guarantor or a Restricted Subsidiary of the Company or the Guarantor, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Valueequal to the fair market value of the assets or Equity Interests issued or sold or otherwise disposed of;
(2) such fair market value is determined by the Company's or the Guarantor's Board of Directors, as the case may be, and evidenced by a resolution of such Board of Directors set forth in an Officers' Certificate delivered to the Trustee; and
(b3) at least 75% of the consideration therefor received by the Company Company, the Guarantor or its such Restricted Subsidiaries consists Subsidiary is in the form of cash cash, Cash Equivalents or Cash Equivalents; provided that for readily marketable securities. For purposes of this clause (2)Section 4.11, each of the following shall be considered cash or Cash Equivalentsdeemed to be cash:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's, the Guarantor's or such Restricted Subsidiary's most recent balance sheet sheet) of the Company, the Guarantor or in the footnotes thereto) any Restricted Subsidiary (other than Subordinated Debt or other obligations or contingent liabilities and liabilities that are by their terms subordinated in right of payment to the NotesNotes or the Guarantees) that are assumed by the transferee of the Company or a Restricted Subsidiary any such assets pursuant to operation of law or a customary novation agreement,agreement that releases the Company, the Guarantor or such Restricted Subsidiary from further liability;
(iib) Additional Assets,
(iii) instrumentsany securities, notes, securities notes or other obligations received by the Company Company, the Guarantor or any such Restricted Subsidiary from such transferee that are converted by the Company, the Guarantor or such Restricted Subsidiary from the purchaser that are promptlyinto cash, but in any event Cash Equivalents or readily marketable securities within 90 60 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, after receipt thereof (to the extent of the cash or cash, Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration or readily marketable securities received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year conversion); and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.64
Appears in 1 contract
Sources: Indenture (Charter Communications Holdings Capital Corp)
Limitation on Asset Sales. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary receives consideration at the time of such Asset Sale is for at least equal to the Fair Market Value; andValue of the assets sold or otherwise disposed of as deter-mined in good faith by the Company's Board of Directors;
(bii) at least 75% of the consideration received by the Company or its the applicable Restricted Subsidiaries consists Subsidiary from such Asset Sale shall be in the form of cash or Cash Equivalents; provided , and is received at the time of the Asset Sale (which shall be deemed to include other consideration converted to cash or Cash Equivalents within 90 days of such Asset Sale). For the purposes of this provision, the amount of any liabilities shown on the most recent applicable balance sheet of the Company or the applicable Restricted Subsidiary, other than liabilities that are by their terms subordinated to the Notes, that are assumed by the transferee of any such assets will be deemed to be cash for purposes of this clause provision; and
(2)iii) upon the consummation of an Asset Sale, each the Company shall apply, or cause such applicable Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 415 days of having received the following shall be considered cash or Net Cash Equivalents:Proceeds.
(b) Additionally, the Company may only apply the Net Cash Proceeds either (i) to prepay any Designated Senior Debt or Indebtedness of a Restricted Subsidiary of the assumption Company that is not a Guarantor and, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility, and/or (ii) to make an investment in or expenditures for properties and assets (including Capital Stock of any entity) that will be used in a Permitted Business ("Replacement Assets") and/or (iv) make an acquisition of (A) assets of any Person or division or (B) Capital Stock of a Person that as a result of such acquisition becomes a Restricted Subsidiary of the Company, in either case, conducting a Permitted Business ("RelatedBusinesses").
(c) Pending the final application of any such Net Cash Proceeds, the Company or any Restricted Subsidiary of the Company may temporarily reduce revolving credit borrowings or otherwise invest such Net Cash Proceeds in any manner that is not prohibited by the purchaser terms of Debt this Indenture.
(d) On the 366th day after an Asset Sale or other obligations or liabilities (as shown any earlier date, if any, on which the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right Board of payment to the Notes) Directors of the Company or a of the applicable Restricted Subsidiary pursuant determines not to operation apply the Net Cash Proceeds in accordance with the provisions of law Section 4.15(b) (each, a "Net Proceeds Offer Trigger Date"), such aggregate amount of Net Cash Proceeds which have not been applied or a customary novation agreement,
contractually committed to be applied (ii) Additional Assets,
(iii) instrumentsand to the extent not subsequently applied, notesthe Net Proceeds Offer Trigger Date related thereto shall be deemed to be the date of termination of such contractual commitment or any earlier date, securities or other obligations received by if any, on which the Board of Directors of the Company or such the board of the applicable Restricted Subsidiary from determines not to apply the purchaser that are promptly, but Net Cash Proceeds in any event within 90 days accordance with such contractual commitment) on or before such Net Proceeds Offer Trigger Date as permitted by the provisions of Section 4.15(b) (the closing, converted "Net Proceeds Offer Amount") shall be applied by the Company or such Restricted Subsidiary to cash make an offer to purchase (or Cash Equivalentsrepay, to prepay or redeem, as the extent of case may be) (the cash or Cash Equivalents actually so received, and
"Net Proceeds Offer") on a date (iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d"Net Proceeds Offer Payment Date") that is at not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, from all Holders and all holders of Indebtedness that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million is equal in the aggregate since the Issue Date (right of payment with the Fair Market Value Notes and contains provisions requiring that an offer to purchase such other Indebtedness be made with the proceeds of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, on a pro rata basis, the maximum principal amount of Notes and other Indebtedness that may be purchased with the Net Proceeds Offer Amount. Notwithstanding the foregoing, the obligation to make a Net Proceeds Offer shall be suspended until such time as the aggregate amount of the Net Proceeds Offer Amount is equal to or exceeds €20 million. The offer price in any Net Proceeds Offer will be equal to 100% of the principal value of the Notes to be purchased, plus any accrued and unpaid interest to the date of purchase. The following events will be deemed to constitute an Asset Sale and the Net Cash Proceeds may for such Asset Sale must be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, 4.15: (i) in the event any non-cash consideration received by the Company or any Restricted Subsidiary may use of the Company in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), or (ii) in the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01 and as a result thereof the Company is no longer an obligor on the Notes, the successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.15, and shall comply with the provisions of this Section 4.15 with respect to such deemed sale as if it were an Asset Sale. In addition, the Fair Market Value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from for purposes of this Section 4.15.
(e) Notwithstanding the preceding paragraphs, the Company and its Restricted Subsidiaries may con-summate an Asset Sale without complying with such paragraphs to the extent (i) the consideration for general corporate purposes such Asset Sale constitutes Replacement Assets or Related Businesses and (ii) such Asset Sale is for Fair Market Value; provided,however, that any consideration that does not constitute Replacement Assets or Related Businesses that is received by the Company or any of its Restricted Subsidiaries in connection with any Asset Sale permitted under this paragraph shall constitute Net Cash Proceeds and will be subject to the provisions described in the preceding paragraphs.
(f) Each notice of a Net Proceeds Offer pursuant to this Section 4.15 shall be mailed by the Company to Holders of Notes not more than 30 days following the Net Proceeds Offer Trigger Date, with a copy to the Trustee. The notice shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Net Proceeds Offer and shall state the following terms:
(1) that the Net Proceeds Offer is being made pursuant to Section 4.15 of this Indenture, that all Notes tendered will be accepted for payment; provided,however, that if the aggregate principal amount of Notes tendered in a Net Proceeds Offer plus accrued interest at the expiration of such offer exceeds the aggregate amount of the Net Proceeds Offer, the Company shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so that no Note of less than $75,000 or €50,000, as the case may be, shall remain outstanding thereafter) and that the Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer periods as may be required by law;
(2) the purchase price (including the amount of accrued interest) and the Net Proceeds Offer Payment Date (which shall be not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date and which shall be at least five Business Days after the Trustee receives notice thereof from the Company);
(3) that any Note not tendered will continue to accrue interest;
(4) that, unless the Company defaults in making payment therefor, any Note accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(5) that Holders electing to have a reduction Note purchased pursuant to a Net Proceeds Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Note completed, to the Paying Agent at the address specified in borrowings under any revolving credit facility) the notice prior to the end close of business on the third Business Day prior to the Net Proceeds Offer Payment Date;
(6) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a telegram, telex, facsimile transmission or letter setting forth the name of the 360-day period referred Holder, the principal amount of the Notes the holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased; and
(7) that Holders whose Notes are purchased only in part will be issued new Notes of the appropriate series in a principal amount equal to the unpurchased portion of the Note surrendered; provided,however, that each such new Note shall be in the first sentence same currency as the tendered Note and in a principal amount of $75,000 or €50,000, as the case may be, or an integral multiple of $1,000 or €1,000, as the case may be, in excess thereof. On or before the Net Proceeds Offer Payment Date, the Company shall (i) accept for payment Notes or portions thereof (in a principal amount of $75,000 or €50,000, as the case may be, or an integral multiple of $1,000 or F1,000, as the case may be, in excess thereof) validly tendered pursuant to the Net Proceeds Offer, (ii) deposit with the Paying Agent, in accordance with Section 2.14, U.S. Legal Tender (in the case of Dollar Notes) and/or euro (in the case of Euro Notes) sufficient to pay the purchase price plus accrued and unpaid interest, if any, of all Notes to be purchased and (iii) deliver to the Trustee Notes so accepted together with an Officer's Certificate stating the Notes or portions thereof being purchased by the Company. Upon receipt by the Paying Agent of the monies specified in clause (ii) above and a copy of the Officer's Certificate specified in clause (iii) above, the Paying Agent shall promptly mail to the Holders of Notes so accepted payment in an amount equal to the purchase price plus accrued and unpaid interest, if any, out of the funds deposited with the Paying Agent in accordance with the preceding sentence. The Trustee shall promptly authenticate and mail or cause to be transferred by book-entry to such Holders new Notes equal in principal amount to any unpurchased portion of the Notes surrendered; provided that each such new Note shall be in the same currency as the surrendered Note and in a principal amount of $75,000 or €50,000, as the case may be, or an integral multiple of $1,000 or €1,000, as the case may be, in excess thereof. Upon the payment of the purchase price for the Notes accepted for purchase, the Trustee shall return the Notes purchased to the Company for cancellation. Any monies remaining after the purchase of Notes pursuant to a Net Proceeds Offer shall be returned within three Business Days by the Trustee to the Company except with respect to monies owed as obligations to the Trustee pursuant to Article Seven. For purposes of this Section 4.09(c).
(d) When 4.15, the aggregate Trustee shall act as the Paying Agent for the Dollar Notes and the Euro Paying Agent shall act as the Paying Agent for the Euro Notes. To the extent the amount of Notes tendered pursuant to any Net Proceeds Offer is less than the amount of Net Cash Proceeds from Asset Sales not applied pursuant subject to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)such Net Proceeds Offer, the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator Company may use any remaining portion of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly such Net Cash Proceeds not required to fund the repurchase of tendered Notes for general corporate purposes and such Net Proceeds Offer Amount shall be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down reset to the nearest $1,000zero. The purchase price for the Notes Company will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such rule, laws and regulations are applicable in connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02the provisions of this Indenture relating to a Net Proceeds Offer, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 relating to such Net Proceeds Offer by virtue of such conflictthereof.
Appears in 1 contract
Sources: Indenture (Lyondell Chemical Co)
Limitation on Asset Sales. The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; and
equal to the fair market value of the assets sold or otherwise disposed of (bas determined in good faith by the Company's Board of Directors), (ii) at least 75% of the consideration received by the Company or its such Restricted Subsidiaries consists Subsidiary (exclusive of indemnities), as the case may be, from such Asset Sale shall be cash or Cash EquivalentsEquivalents and shall be received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Re- stricted Subsidiary's most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any such Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Securities) that are assumed by the transferee of law or a customary novation agreement,
any such assets, (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations Obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, immediately converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents (to the extent of the cash or Cash Equivalents actually so received, and
) and (ivc) any Designated Non-Cash cash Consideration received by the Company or any of its Restricted Subsidiaries in such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Valuefair market value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this clause (d) that is at that time outstandingc), not to exceed (x) $10.0 5 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value fair market value of each item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
, shall be deemed to be cash for the purposes of this clause (cii); and provided, further, that the TEK Transaction shall not be subject to this clause (ii), and (iii) Within 360 days after upon the receipt consummation of any Net Cash Proceeds from an Asset Sale, the Company shall apply directly or through a Restricted Subsidiary, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds may be used:
(i) relating to permanently repay such Asset Sale within 270 days of receipt thereof either (A) Debt outstanding under to repay any Indebtedness ranking at least pari passu with the Credit Agreement Securities and the Guarantees (and, and in the case of the repayment of the any Indebtedness outstanding under a revolving credit facility under the Credit Agreementfacility, to permanently reduce the commitment amounts that may be reborrowed thereunder by such an equivalent amount) or ), with the Net Cash Proceeds received in respect thereof, (B) to reinvest in Productive Assets, or (C) a combination of prepayment, reduction and investment permitted by the Notes foregoing clauses (iii)(A) and (iii)(B); provided that the 75% limitation referred to above shall not apply to any Debt secured by Liens ranking pari passu sale, transfer or other disposition of assets in which the cash portion of the consideration received therefor is equal to or greater than what the after-tax net proceeds would have been had such transaction complied with the Liens securing aforementioned 75% limitation. On the Notes (271st day after an Asset Sale or such earlier date, if any) through making , as the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business Board of Directors of the Company or one of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each, a "Net Proceeds Offer Trigger Date"), such aggregate amount of Net Cash Proceeds which have not been applied on or more Restricted Subsidiaries; provided that before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each, a binding commitment "Net Proceeds Offer Amount") shall be applied by the Company to make an acquisition referred offer to in clause repurchase (iithe "Net Proceeds Offer") or on a date (iiithe "Net Proceeds Offer Payment Date") above shall not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, from all Holders on a pro rata basis that amount of Securities equal to the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Securities to be treated as repurchased, plus accrued and unpaid interest, if any, to the date of repurchase. Notwithstanding the foregoing, if a permitted Net Proceeds Offer Amount is less than $10 million, the application of the Net Cash Proceeds constituting such Net Proceeds Offer Amount to a Net Proceeds Offer may be deferred until such time as such Net Proceeds Offer Amount plus the aggregate amount of all Net Proceeds Offer Amounts arising subsequent to the Net Proceeds Offer Trigger Date relating to such initial Net Proceeds Offer Amount from all Asset Sales by the date of such commitment; provided that (x) such investment is consummated within 180 days of Company and its Restricted Subsidiaries aggregates at least $10 million, at which time the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Company shall apply all Net Cash Proceeds not constituting all Net Proceeds Offer Amounts that have been so applied will deferred to make a Net Proceeds Offer (the first date the aggregate of all such deferred Net Proceeds Offer Amounts is equal to $10 million or more shall be deemed to be Excess a Net Proceeds (as defined belowOffer Trigger Date). For To the avoidance extent that the aggregate purchase price of doubt, pending application thereof in accordance with this Section 4.09Securities tendered pursuant to any Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company or any Restricted Subsidiary Guarantor may use such amount for general corporate purposes. Upon completion of any Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset to zero. Notwithstanding the two immediately preceding paragraphs, the Company and its Restricted Subsidiaries will be permitted to consummate an Asset Sale without complying with such paragraphs to the extent (i) at least 75% of the consideration for such Asset Sale constitutes Productive Assets and (ii) such Asset Sale is for fair market value (as determined in good faith by the Company's Board of Directors); provided that any consideration not constituting Productive Assets received by the Company or any of its Restricted Subsidiaries in connection with any Asset Sale permitted to be consummated under this paragraph shall constitute Net Cash Proceeds from subject to the provisions of the two preceding paragraphs. In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01, the successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this covenant, and shall comply with the provisions of this covenant with respect to such deemed sale as if it were an Asset Sale Sale. In addition, the fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for general corporate purposes (including of this covenant. Notice of a reduction in borrowings under any revolving credit facility) prior Net Proceeds Offer shall be mailed, by first-class mail, by the Company to Holders of Securities at their last registered address not less than 30 days nor more than 60 days following the Net Proceeds Offer Trigger Date, with a copy to the end of Trustee. The notice shall contain all instructions and materials necessary to enable such Holders to tender Securities pursuant to the 360-day period referred to in Net Proceeds Offer and shall state the first sentence of this Section 4.09(c).following terms:
(d1) When that the Net Proceeds Offer is being made pursuant to Section 4.16, that all Securities tendered will be accepted for payment; provided, however, that if the aggregate principal amount of Securities tendered in a Net Proceeds Offer plus accrued interest at the expiration of such offer exceeds the aggregate amount of the Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)Offer, the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) Company shall select the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required Securities to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount purchased on a pro rata basis to the extent practicable, (with such adjustments as may be deemed appropriate by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, Securities in denominations of $1.00 1,000 or multiples thereof shall be purchased) and that the Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law;
(2) the purchase price (including the amount of accrued interest) and the Net Proceeds Offer Payment Date (which shall be not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date and which shall be at least five Business Days after the Trustee receives notice thereof from the Company);
(3) that any integral multiple Security not tendered will continue to accrue interest;
(4) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(5) that Holders electing to have a Security purchased pursuant to a Net Proceeds Offer will be required to surrender the Security, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Secu- rity completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Business Day prior to the Net Proceeds Offer Payment Date;
(6) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Securities such Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Securities purchased; and
(7) that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount equal to the unpurchased portion of the Securities surrendered; provided, however, that each Security purchased and each new Security issued shall be in an original principal amount of $1.00 1,000 or integral multiples thereof. On or before the Net Proceeds Offer Payment Date, the Company shall (i) accept for payment Securities or portions thereof tendered pursuant to the Net Proceeds Offer which are to be purchased in excess accordance with item (1) above, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the purchase price plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers' Certificate stating the Securities or portions thereof with respect being purchased 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 plus accrued interest, if any. For purposes of this Section 4.16, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a PIK Note or Net Proceeds Offer shall be returned by the portion of Trustee to the Company. If an offer is made to repurchase the Securities pursuant to a Global Note constituting PIK Interest). Upon completion of Net Proceeds Offer, the Offer Company will and will cause its Restricted Subsidiaries to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of Rule 14e-1 all tender offer rules under state and federal securities laws, including, but not limited to, Section 14(e) under the Exchange Act and any other securities laws and regulations thereunder Rule 14e-1 thereunder, to the extent applicable to such laws and regulations are applicable in connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09offer. To the extent that the provisions of any securities laws or regulations conflict with this Section 4.09 or Section 3.024.16, the Issuers Company shall comply with the applicable securities laws and regulations obligations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 hereunder by virtue of such conflictthereof.
Appears in 1 contract
Sources: Indenture (Autotote Corp)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make consummate any Asset Sale unless the following conditions are metunless:
(a1) the Asset Sale is for Company or any of its Restricted Subsidiaries, as the case may be, receives consideration at least equal to the Fair Market ValueValue (as determined at the time of contractually agreeing to such Asset Sale) of the Capital Stock, assets or property sold or otherwise disposed of pursuant to such Asset Sale; and
(b2) except in the case of a Permitted Asset Swap, at least 7575.0% of the consideration from such Asset Sale received by the Company or its such Restricted Subsidiaries consists Subsidiary, as the case may be, is in the form of cash or Cash EquivalentsEquivalents or Replacement Assets; provided provided, that for purposes of this clause (2), each of the following shall be considered cash or Cash Equivalentsamount of:
(iA) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt notes thereto for which internal financial statements are available immediately preceding such date or, if incurred or other obligations or liabilities subordinated in right of payment accrued subsequent to the Notesdate of such balance sheet, such liabilities that would have been reflected on the Company’s or such Restricted Subsidiary’s balance sheet or in the notes thereto if such incurrence or accrual had taken place on or prior to the date of such balance sheet in the good faith determination of the Company) of the Company or a any Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Notes) that are extinguished in connection with the transactions relating to such Asset Sale, or that are assumed by the transferee of any such assets, property or Capital Stock, in each case, pursuant to operation of law an agreement that releases or a customary novation agreement,indemnifies the Company or such Restricted Subsidiary, as the case may be, from further liability therefor;
(iiB) Additional Assets,
(iii) instrumentsany securities, notes, securities notes or other obligations or other assets or property received by the Company or such any Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, or by their terms are required to be satisfied for cash or Cash Equivalents (to the extent of the cash or Cash Equivalents actually so received), in each case within 180 days following the receipt thereof; and
(ivC) any Designated Non-Cash Noncash Consideration received by the Company or any of its Restricted Subsidiaries in such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this clause subclause (dC) that is at that time outstanding, not to exceed the greater of (x) $10.0 100.0 million per fiscal year and (y) $30.0 million in 5.0% of Total Assets, calculated at the aggregate since time of the Issue Date receipt of such Designated Noncash Consideration (with the Fair Market Value of each item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); shall each be deemed to be Cash Equivalents for the purposes of this clause (2). Notwithstanding the foregoing, the 75.0% limitation referred to in clause (2) of this Section 4.10(a) shall be deemed satisfied with respect to any Asset Sale in which the cash, Cash Equivalents and Replacement Assets portion of the consideration received therefrom, determined in accordance with the foregoing provision on an after-tax basis, if the proceeds before tax would have complied with the aforementioned 75.0% limitation.
(b) Within 365 days after the Company’s or any Restricted Subsidiary’s receipt of the Net Cash Proceeds of any Asset Sale, the Company or a Restricted Subsidiary, at its option, may apply an amount equal to the Net Cash Proceeds from such Asset Sale (or any portion thereof) as follows:
(1) to repay, prepay, defease, redeem, reduce, purchase or otherwise retire (and to correspondingly reduce commitments with respect thereto in the case of revolving borrowings): (x) Indebtedness or other obligations under the Senior Credit Facility or the Ex-Im Credit Facility, (y) Indebtedness of the Company (other than any Disqualified Stock or Subordinated Obligations) that is secured by a Lien (other than Indebtedness owed to an Affiliate of the Company) or (z) Indebtedness of a Restricted Subsidiary (other than any Disqualified Stock or Guarantor Subordinated Obligations) that is secured by a Lien (other than Indebtedness owed to the Company or an Affiliate of the Company);
(2) in the case of an Asset Sale by a Restricted Subsidiary that is a Non-Guarantor Subsidiary, to repay, prepay, defease, redeem, reduce, purchase or otherwise retire (and to correspondingly reduce commitments with respect thereto in the case of revolving borrowings) Indebtedness of such Restricted Subsidiary or any other Restricted Subsidiary that is a Non-Guarantor Subsidiary;
(3) to repay, prepay, defease, redeem, reduce, purchase or otherwise retire (and to correspondingly reduce commitments with respect thereto in the case of revolving borrowings) any other Indebtedness of the Company (other than any Disqualified Stock or Subordinated Obligations) or Indebtedness of a Restricted Subsidiary (other than any Disqualified Stock or Guarantor Subordinated Obligations) (in each case other than Indebtedness owed to the Company or an Affiliate of the Company); provided that the Company shall equally and ratably reduce obligations, under the Notes as provided under Section 3.01, through open market purchases (to the extent such purchases are at or above 100.0% of the principal amount thereof) or by making an offer (in accordance with the procedures set forth below for an Asset Sale Offer) to all Holders to purchase their Notes at 100.0% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, on the amount of Notes that would otherwise be prepaid;
(4) to make an investment in, purchase or otherwise acquire any one or more businesses, assets (other than working capital assets), properties or capital expenditures, in each case used or useful in a Similar Business or to make payments (including without limitation prepayments and progress payments) in connection with such investment, purchase or other acquisition; provided, that if such investment, purchase or acquisition is in the form of the acquisition of Capital Stock of a Person, such investment, purchase or acquisition results in such Person becoming a Restricted Subsidiary;
(5) to make an investment in, purchase or otherwise acquire any one or more businesses, assets (other than working capital assets) or properties that replace the businesses, assets and/or properties that are the subject to such Asset Sale; or
(6) any combination of the foregoing; provided, that the Company and its Subsidiaries will be deemed to have complied with the provisions described in clause (4) or (5) of this Section 4.10(b) if and to the extent that, within 365 days after the Company’s or any Restricted Subsidiary’s receipt of such Net Cash Proceeds, the Company or a Restricted Subsidiary, as applicable, has entered into and not abandoned or rejected a binding agreement to make an investment, purchase or other acquisition in compliance with the provision described in clause (4) or (5) of this Section 4.10(b), and that investment, purchase or other acquisition is thereafter completed within 180 days after the end of such 365-day period.
(c) Within 360 days after Notwithstanding the receipt foregoing, to the extent that repatriation to the United States of any or all of the Net Cash Proceeds from an of any Asset SaleSales by a Foreign Subsidiary (x) is prohibited or delayed by applicable local law or (y) would have a material adverse tax consequence (taking into account any foreign tax credit or other net benefit actually realized in connection with such repatriation that would not otherwise be realized), as determined by the Company in its sole discretion, the portion of such Net Cash Proceeds so affected will not be required to be applied in compliance with this covenant, and such amounts may be retained by the applicable Foreign Subsidiary; provided that clause (x) of this paragraph shall apply to such amounts so long, but only so long, as the applicable local law will not permit repatriation to the United States (the Company hereby agreeing to use commercially reasonable efforts to cause the applicable Foreign Subsidiary to take all actions reasonably required by the applicable local law, applicable organizational impediments or other impediment to permit such repatriation), and if such repatriation of any of such affected Net Cash Proceeds is permitted under the applicable local law and is not subject to clause (y) of this paragraph, then, such repatriation will be promptly effected and such repatriated Net Cash Proceeds will be applied (net of additional taxes payable or reserved against as a result thereof) in compliance with this covenant. The time periods set forth in this covenant shall not start until such time as the Net Cash Proceeds may be used:repatriated (whether or not such repatriation actually occurs).
(id) to permanently repay Pending the final application of any such Net Cash Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Indebtedness (A) including under a revolving Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amountFacility) or (B) the Notes and otherwise invest or utilize such Net Available Cash in any Debt secured manner not prohibited by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business this Indenture. Any amount of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided any Asset Sale that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated applied or invested as provided and within the time period set forth in Section 4.10(b) will be deemed to constitute “Excess Proceeds”; provided, that any amount of proceeds offered to Holders pursuant to clause (x3) of Section 4.10(b) or such binding commitment is terminated, pursuant to an Asset Sale Offer made at any time after the Net Cash Proceeds Asset Sale shall be deemed to have been applied as required and shall not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior without regard to the end of extent to which such offer is accepted by the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) Holders. When the aggregate amount of Net Cash Excess Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million 50.0 million, the Company will be required to make an offer (“Excess ProceedsAsset Sale Offer”)) to all Holders of Notes and, to the Issuers mustextent required by the terms of other Pari Passu Indebtedness, within 30 daysto all holders of other Pari Passu Indebtedness outstanding with similar provisions requiring the Company (or the Subsidiary Guarantor, as applicable) to make an offer to purchasepurchase such Pari Passu Indebtedness with the proceeds from any Asset Sale, in accordance with Section 3.02, Notes having a to purchase the maximum principal amount equal to:
(i) accumulated of Notes and any such Pari Passu Indebtedness to which the Asset Sale Offer applies that may be purchased out of the Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is at an offer price in cash in an amount equal to 100.0% of the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount Pari Passu Indebtedness plus accrued and unpaid interest to, to (but excluding not including) the date of purchase. If purchase (or such lesser price with respect to the Offer to Purchase is for less than all Pari Passu Indebtedness, if any, as may be provided by the terms of such Indebtedness), in accordance with the outstanding procedures set forth in this Indenture or the agreements governing the Pari Passu Indebtedness, as applicable.
(e) To the extent that the aggregate amount of Notes and Notes in an aggregate principal amount in excess of the purchase amount are Pari Passu Indebtedness so properly tendered and not withdrawn pursuant to an Asset Sale Offer is less than the offerExcess Proceeds, the Issuers shall purchase Notes having an Company may use any remaining Excess Proceeds (any such amount, “Retained Declined Proceeds”) for any purpose not prohibited by this Indenture. If the aggregate principal amount equal to of Notes surrendered by Holders thereof and other Pari Passu Indebtedness surrendered by Holders or lenders, collectively, exceeds the amount of Excess Proceeds, selection of Notes for purchase amount on a pro rata basis to the extent practicable, with adjustments will be made by the Company so that only Notes Trustee in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof accordance with respect to a PIK Note or the portion of a Global Note constituting PIK InterestSection 3.04(f). Upon completion of such Asset Sale Offer, the Offer to Purchase, amount of Excess Proceeds will shall be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.
Appears in 1 contract
Sources: Indenture (Viasat Inc)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s Board of Directors);
(b2) at least 75% of the consideration received by the Company or its such Restricted Subsidiaries consists of Subsidiary, as the case may be, from such Asset Sale shall be cash or Cash EquivalentsEquivalents and is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ix) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes notes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a such Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Notes and other than liabilities consisting of law Disqualified Capital Stock) (i) that are assumed by the transferee of any such assets and from which the Company and its Restricted Subsidiaries are unconditionally released or a customary novation agreement,
(ii) Additional Assets,
in respect of which neither the Company nor any Restricted Subsidiary following such sale has any obligation and (iiiy) instruments, notes, securities any notes or other obligations received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any no event within 90 more than 60 days of the closingafter receipt, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents (to the extent of the cash or Cash Equivalents actually so received), shall be deemed to be cash for purposes of this provision; and
(iv3) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 450 days of receipt thereof either:
(A) to repay any Designated Non-secured Indebtedness (other than (1) Subordinated Obligations and (2) in the event the Notes become secured by a Lien on any property or assets, Indebtedness secured equally and ratably in such property or assets or secured by Liens junior in priority to the Liens securing the Notes) and, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility;
(B) to reinvest in Productive Assets (and to the extent such reinvestment constitutes an Investment, such reinvestment complies with Section 4.8); or
(C) a combination of repayment and investment permitted by the foregoing clauses (3)(A) and (3)(B). On the 451st day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Consideration received Proceeds relating to such Asset Sale as set forth in clauses (3)(A), (3)(B) and (3)(C) of the immediately preceding sentence (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (3)(A), (3)(B) and (3)(C) of the immediately preceding sentence (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary to make an offer to purchase for cash (the “Net Proceeds Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, from all Holders and holders of pari passu Indebtedness that is subject to a similar repurchase offer requirement on a pro rata basis, that amount of Notes and such pari passu Indebtedness equal to the Net Proceeds Offer Amount at a price in cash equal to 100% of the principal amount of the Notes and such pari passu Indebtedness to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, that if at any time any non-cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may be, in connection with any Asset Sale having an aggregate Fair Market Valueis converted into or sold or otherwise disposed of for cash (other than interest, taken together dividends or other earnings received with all other Designated Nonrespect to any such non-Cash Consideration received pursuant cash consideration), then such conversion or disposition shall be deemed to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from constitute an Asset Sale, Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds may thereof shall be used:applied in accordance with this covenant.
(ib) to permanently repay (A) Debt outstanding under Notwithstanding the Credit Agreement (andforegoing, in if a Net Proceeds Offer Amount is less than $30.0 million, the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds constituting such Net Proceeds Offer Amount to a Net Proceeds Offer may be deferred until such time as such Net Proceeds Offer Amount plus the aggregate amount of all Net Proceeds Offer Amounts arising subsequent to the Net Proceeds Offer Trigger Date relating to such initial Net Proceeds Offer Amount from all Asset Sales by the date of such commitment; provided that (x) such investment is consummated within 180 days of Company and its Restricted Subsidiaries aggregates at least $30.0 million, at which time the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) Company or such binding commitment is terminated, the Restricted Subsidiary shall apply all Net Cash Proceeds not constituting all Net Proceeds Offer Amounts that have been so applied will deferred to make a Net Proceeds Offer (the first date the aggregate of all such deferred Net Proceeds Offer Amounts is equal to $30.0 million or more shall be deemed to be Excess a Net Proceeds Offer Trigger Date).
(c) Notwithstanding paragraphs (a) and (b) of this Section 4.12, the Company and its Restricted Subsidiaries will be permitted to consummate an Asset Sale without complying with such paragraphs to the extent that:
(1) at least 75% of the consideration for such Asset Sale constitutes Productive Assets (and to the extent any of such Productive Assets constitutes an Investment, such Investment complies with Section 4.8); and
(2) such Asset Sale is for at least fair market value (as defined belowdetermined in good faith by the Company’s Board of Directors). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, ; provided that any consideration not constituting Productive Assets received by the Company or any of its Restricted Subsidiary may use Subsidiaries in connection with any Asset Sale permitted to be consummated under this paragraph shall constitute Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior and shall be subject to the end of the 360-day period referred to in the first sentence provisions of this Section 4.09(c)covenant with respect to the application of Net Cash Proceeds; provided that at the time of entering into such transaction or immediately after giving effect thereto, no Default or Event of Default shall have occurred or be continuing or would occur as a consequence thereof.
(d) When Within 25 days following the aggregate amount Net Proceeds Offer Trigger Date, the Company shall mail or cause the Trustee to mail (in the Company’s name and at its expense) notice of a Net Cash Proceeds Offer to the Holders of the Notes at their last registered addresses with a copy to the Trustee and the Paying Agent. The Net Proceeds Offer shall remain open from Asset Sales not applied the time of mailing for at least 20 Business Days and until the close of business on the third Business Day prior to the Net Proceeds Offer Payment Date or such longer period as may be required by Law. The notice shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)Net Proceeds Offer. The notice, which shall govern the Issuers mustterms of the Net Proceeds Offer, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal toshall state:
(i) accumulated Excess Proceeds, multiplied bythat the Net Proceeds Offer is being made pursuant to this Section 4.12;
(ii) a fraction the purchase price (xincluding the amount of accrued and unpaid interest, if any) for each Note and the numerator of which is equal Net Proceeds Offer Payment Date;
(iii) that any Note not tendered or accepted for payment will continue to accrue interest in accordance with the terms thereof;
(iv) that any Note accepted for payment pursuant to the outstanding aggregate Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date unless the Company shall fail to make payment therefor;
(v) that Holders electing to have Notes purchased pursuant to a Net Proceeds Offer will be required to surrender their Notes to the Paying Agent at the address specified in the notice prior to 5:00 p.m., New York City time, on the third Business Day immediately preceding the Net Proceeds Offer Payment Date and must complete any form letter of transmittal proposed by the Company and acceptable to the Trustee and the Paying Agent;
(vi) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than 5:00 p.m., New York City time, on the third Business Day immediately preceding the Net Proceeds Offer Payment Date, a telex or facsimile transmission (confirmed by overnight delivery of the original thereof) or letter setting forth the name of the Holder, the principal amount of Notes the Holder delivered for purchase, the Note certificate number (if any) and a statement that such Holder is withdrawing his election to have such Notes and purchased;
(yvii) the denominator of which is equal to the outstanding aggregate principal amount of the that if Notes and all Debt secured by Liens on the Collateral ranking and, if applicable, other pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for Indebtedness in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate a principal amount in excess of the purchase amount Holders’ pro rata share of the Net Proceeds are tendered and not withdrawn pursuant to the offera Net Proceeds Offer, the Issuers Company shall purchase Notes having an aggregate principal amount equal to the purchase amount and, if applicable, such other Indebtedness on a pro rata basis to among the extent practicable, Notes and other Indebtedness tendered (with such adjustments as may be deemed appropriate by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 or integral multiples thereof shall be acquired);
(viii) that Holders whose Notes are purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered; and
(ix) the instructions that Holders must follow in order to tender their Notes. On or before the Net Proceeds Offer Payment Date, the Company shall (i) accept for payment, on a pro rata basis among the Notes, Notes or portions thereof tendered pursuant to the Net Proceeds Offer, (ii) deposit with the Paying Agent money, in immediately available funds, in an amount sufficient to pay the purchase price of all Notes or portions thereof so tendered and accepted and (iii) deliver to the Paying Agent the Notes so accepted together with an Officers’ Certificate setting forth the Notes or portions thereof tendered to and accepted for payment by the Company. The Paying Agent shall promptly mail or deliver to Holders of Notes so accepted payment in an amount equal to the purchase price, and the Trustee shall promptly authenticate and mail or deliver to such Holders a new Note equal in principal amount to any integral multiple unpurchased portion of $1.00 in excess thereof with respect the Note surrendered. Any Notes not so accepted shall be promptly mailed or delivered by the Company to the Holder thereof. The Paying Agent shall promptly deliver to the Company the balance of any moneys held by the Paying Agent after payment to the Holders of Notes as aforesaid.
(e) To the extent that the aggregate amount of Notes tendered pursuant to a PIK Note or Net Proceeds Offer is less than the portion of a Global Note constituting PIK Interest)Net Proceeds Offer Amount, the Company may use any remaining Net Proceeds Offer Amount for general corporate purposes. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer to Purchase, Excess Proceeds will Amount shall be reset at zero.
(f) The Company shall comply, and any Excess Proceeds remaining after consummation of to the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply extent applicable, with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other securities laws and or regulations thereunder to (including Rule 14e-1 under the extent such laws and regulations are applicable Exchange Act) in connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.12, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.12 by virtue of such conflictthereof.
Appears in 1 contract
Sources: Indenture (Webcraft LLC)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any Restricted Subsidiary to, make any Asset Sale unless (i) the following conditions are met:
Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the fair market value (aas evidenced by a resolution of the Board of Directors set forth in an Officers' Certificate delivered to the Trustee) of the assets or other property sold or disposed of in the Asset Sale is for at least Fair Market Value; and
and (bii) at least 75% of the such consideration received by the Company or its Restricted Subsidiaries consists of either cash or Cash Equivalents; provided provided, however, that for purposes of this clause Section 4.16, "cash" shall include (2), each of the following shall be considered cash or Cash Equivalents:
(ix) the assumption by the purchaser amount of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) any Indebtedness (other than Subordinated Debt or other obligations or liabilities any Indebtedness that is by its terms subordinated in right of payment to the Notes) of the Company or a such Restricted Subsidiary pursuant as shown on the Company's or such Restricted Subsidiary's most recent balance sheet or in the notes thereto that is assumed by the transferee of any such assets or other property in such Asset Sale (and excluding any liabilities that are incurred in connection with or in anticipation of such Asset Sale), but only to operation the extent that such assumption is effected on a basis such that there is no further recourse to the Company or any of law or a customary novation agreement,
the Restricted Subsidiaries with respect to such liabilities and (iiy) Additional Assets,
(iii) instruments, any notes, obligations or securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event converted within 90 60 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received, and).
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(cb) Within 360 days one year after the receipt of any Net Cash Proceeds from an Asset Sale, the Company or the applicable Restricted Subsidiary may elect to apply the Net Cash Proceeds may be used:
from such Asset Sale to (ia) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Senior Bank Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to and/or (b) make an acquisition referred to in clause (ii) investment in, or (iii) above shall acquire assets and properties that will be treated as used in, a permitted Related Business. Pending the final application of the any such Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09Proceeds, the Company or any Restricted Subsidiary may use temporarily invest such Net Proceeds in any Investments described under clauses (i) through (iii) of the definition of Permitted Investments. Any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to not applied or invested as provided in the first sentence of this Section 4.09(c)4.16(b) within one year of such Asset Sale will be deemed to constitute "Excess Proceeds."
(dc) When Each date that the aggregate amount of Net Cash Excess Proceeds from in respect of which an Asset Sales Sale Offer (as defined below) has not applied been made exceeds $10.0 million shall be deemed an "Asset Sale Offer Trigger Date." As soon as practicable, but in no event later than 20 business days after each Asset Sale Offer Trigger Date, the Company shall commence an offer (an "Asset Sale Offer") to purchase the maximum principal amount of Notes that may be purchased out of the Excess Proceeds. Any Notes to be purchased pursuant to (and within an Asset Sale Offer shall be purchased pro rata based on the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes outstanding, and (y) the denominator of which is all Notes shall be purchased at an offer price in cash in an amount equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof, plus accrued interest toand unpaid interest, but excluding if any, to the date of purchase. If To the extent that any Excess Proceeds remain after completion of an Asset Sale Offer, the Company may use the remaining amount for general corporate purposes otherwise permitted by this Indenture. Upon the consummation of any Asset Sale Offer, the amount of Excess Proceeds shall be deemed to be reset to zero.
(d) Notice of an Asset Sale Offer shall be mailed, by first-class mail (with a copy to Purchase the Trustee), by the Company not later than the 20th business day after the related Asset Sale Offer Trigger Date to each Holder of Notes at such Holder's registered address, stating: (i) that an Asset Sale Offer Trigger Date has occurred and that the Company is for less than all offering to purchase the maximum principal amount of Notes that may be purchased out of the outstanding Notes and Notes Excess Proceeds (to the extent provided in the immediately preceding paragraph), at an offer price in cash in an aggregate amount equal to 100% of the principal amount in excess thereof, plus accrued and unpaid interest, if any, to the date of the purchase (the "Asset Sale Offer Purchase Date"), which shall be a business day, specified in such notice, that is not earlier than 30 days or later than 60 days from the date such notice is mailed, (ii) the amount are of accrued and unpaid interest, if any, as of the Asset Sale Offer Purchase Date, (iii) that any Note not tendered and not withdrawn will continue to accrue interest, (iv) that, unless the Company defaults in the payment of the purchase price for the Notes payable pursuant to the offerAsset Sale Offer, any Notes accepted for payment pursuant to the Asset Sale Offer shall cease to accrue interest after the Asset Sale Offer Purchase Date, (v) that Holders electing to have a Note purchased pursuant to a Asset Sale Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day prior to the Asset Sale Offer Purchase Date, (vi) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Asset Sale Offer Purchase Date, a facsimile transmission or letter setting forth the name of the Holder, the Issuers shall principal amount of the Notes the Holder delivered for purchase and a statement that such ▇▇▇▇▇▇ is withdrawing his election to have such Note purchased, (vii) that Holders whose Notes having an aggregate are purchased only in part will be issued new Notes in a principal amount equal to the unpurchased portion of the Notes surrendered; provided, however, that each Note purchased and each new Note issued shall be in an original principal amount of $1,000 or integral multiples thereof, and (viii) such other information as may be required by applicable laws and regulations.
(e) On the Asset Sale Offer Purchase Date, the Company will (i) accept for payment the maximum principal amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer that can be purchased out of Excess Proceeds from such Asset Sale that are to be applied to an Asset Sale Offer, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the aggregate purchase amount price of all Notes or portions thereof accepted for payment, and (iii) deliver or cause to be delivered to the Trustee all Notes tendered pursuant to the Asset Sale Offer. If less than all Notes tendered pursuant to the Asset Sale Offer are accepted for payment by the Company for any reason consistent with this Indenture, selection of the Notes to be purchased by the Company shall be in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not so listed, on a pro rata basis to the extent practicableor by lot; provided, with adjustments by the Company so however, that Notes accepted for payment in part shall only Notes be purchased in integral multiples of $1,000 1,000. The Paying Agent shall promptly mail to each Holder of Notes or portions thereof accepted for payment an amount equal to the purchase price for such Notes plus accrued and unpaid interest, if any, thereon, and the Trustee shall promptly authenticate and mail to such Holder of Notes accepted for payment in part a new Note equal in principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and to any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the unpurchased portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zeroNotes, and any Excess Proceeds remaining Note not accepted for payment in whole or in part shall be promptly returned to the Holder of such Note. On and after consummation an Asset Sale Offer Purchase Date, interest will cease to accrue on the Notes or portions thereof accepted for payment, unless the Company defaults in the payment of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenturepurchase price therefor. The Issuers shall Company will publicly announce the results of the Asset Sale Offer on or as soon as practicable after the Asset Sale Offer Purchase Date.
(f) This Section 4.16 will not apply to a transaction consummated in compliance with Article Five.
(g) The Company will comply with the applicable tender offer rules, including the requirements of Section 14(e) and Rule 14e-1 under the Exchange Act Act, and any all other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations in connection with any Asset Sale Offer and shall not will be deemed not to have breached their obligations be in violation of any of the covenants under this Section 4.09 or Section 3.02 by virtue of Indenture to the extent such conflictcompliance is in conflict with such covenants.
Appears in 1 contract
Sources: Indenture (Icn Pharmaceuticals Inc)
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company's senior management or, in the case of an Asset Sale in excess of $5.0 million, the Board of Directors of the Company);
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of (x) cash or Cash Equivalents, (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business or (z) Capital Stock in one or more Persons engaged in a Permitted Business that are or thereby become Restricted Subsidiaries of the Company, and, in each case, such consideration is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as -------- shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Securities) that are assumed by the transferee of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations securities received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 180 days after such Asset Sale (to the extent of the cash or Cash Equivalents actually so received, ) shall be deemed to be cash for the purposes of this provision only; and
(iviii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either:
(A) to prepay any Designated Non-Senior Debt or any Indebtedness of a Restricted Subsidiary and, in the case of any Senior Debt or Indebtedness of a Restricted Subsidiary under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility (or effect a permanent reduction in availability under such revolving credit facility regardless of the fact that no prepayment is required);
(B) to make an Investment (x) in properties and assets that replace the properties and assets that were the subject of such Asset Sale, (y) in properties and assets that will be used in a Permitted Business or (z) permitted by clause (1) of the definition of Permitted Investments (collectively, "Replacement Assets"); or ------------------
(C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Pending the final application of the Net Cash Consideration received Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Indebtedness or otherwise invest such Net Cash Proceeds in any manner not prohibited by this Indenture. On the 361st day after an Asset Sale or such earlier date, if any, as the senior management or the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each, a "Net Proceeds Offer Trigger Date"), such aggregate ------------------------------- amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each a "Net Proceeds Offer Amount") ------------------------- shall be applied by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred offer to in clause purchase (iithe "Net Proceeds Offer") or on a date (iiithe "Net Proceeds Offer ------------------ ------------------ Payment Date") above shall be treated as not less than 30 nor more than 60 days following the applicable ------------ Net Proceeds Offer Trigger Date, from all Holders on a permitted application pro rata basis, that --- ---- amount of Securities equal to the Net Proceeds Offer Amount at a price equal to 100% of the Net Cash Proceeds from principal amount of the Securities to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, -------- ------- that if the Company so elects (or is required by the terms of any Senior Subordinated Debt), such commitment; provided that (x) such investment is consummated within 180 days Net Proceeds Offer may be made ratably to purchase the Securities and other Senior Subordinated Debt of the end of the 360Company. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this covenant. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from an one or more Asset Sale for general corporate purposes Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $10.0 million, shall be applied as required pursuant to the end preceding paragraph). In the event of the 360-day period referred transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the first sentence successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section, and shall comply with the provisions of clause (iii) of this Section 4.09(c).
(d) When with respect to such deemed sale as if it were an Asset Sale. In addition, the aggregate amount fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from Asset Sales not applied for purposes of this Section 4.18. Notice of each Net Proceeds Offer pursuant to (this Section 4.18 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and within materials necessary to enable such Holders to tender Securities pursuant to the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), Net Proceeds Offer and shall state the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal tofollowing terms:
(i) accumulated Excess Proceedsthat Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to prorationing as hereinafter described in the event the Net Proceeds Offer is oversubscribed) in integral multiples of $1,000 of principal amount, multiplied byat the applicable purchase price;
(ii) a fraction (xiii) the numerator purchase price (including the amount of accrued interest, if any) and the purchase date (which is equal shall be no earlier than 30 days nor later than 60 days from the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(iv) that any Security not tendered will continue to accrue interest;
(v) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the outstanding aggregate Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(vi) that Holders electing to have a Security purchased pursuant to the Net Proceeds Offer will be required to surrender the Security, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the ---------------------------------- Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Offer Payment Date;
(vii) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes Security the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; and
(yviii) the denominator of which is that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers' Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so to the Holder thereof. For purposes of this Section 4.18, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that only Notes in multiples of $1,000 principal amount (and in a minimum the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect the Securities tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.18, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.18 by virtue thereof. This covenant and other provisions contained in this Indenture relating to the Company's obligation to make a Net Proceeds Offer may be waived or modified with the written consent of such conflictthe Holders of a majority in principal amount of the Securities.
Appears in 1 contract
Sources: Indenture (RPP Capital Corp)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any Restricted Subsidiary to, make any directly or indirectly, consummate an Asset Sale (including the sale of any of the Capital Stock of any Restricted Subsidiary) providing for Net Proceeds in excess of $2,500,000 unless at least 75% of the Net Proceeds from such Asset Sale are applied (in any manner otherwise permitted by this Indenture) to one or more of the following conditions are met:
purposes in such combination as the Company shall elect: (ai) an investment in another asset or business in the same line of business as, or a line of business similar to that of, the line of business of the Company and its Restricted Subsidiaries at the time of the Asset Sale; provided that such investment occurs on or prior to the 365th day following the date of such Asset Sale (the "Asset Sale Disposition Date"), (ii) to reimburse the Company or its Subsidiaries for expenditures made, and costs incurred, to repair, rebuild, replace or restore property subject to loss, damage or taking to the extent that the Net Proceeds consist of insurance proceeds received on account of such loss, damage or taking, (iii) the purchase, redemption or other prepayment or repayment of outstanding Senior Indebtedness of the Company or Indebtedness of the Company's Restricted Subsidiaries on or prior to the 365th day following the Asset Sale is for at least Fair Market Value; andDisposition Date or (iv) an Offer expiring on or prior to the Purchase Date.
(b) The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, consummate an Asset Sale unless at least 75% of the consideration thereof received by the Company or its such Restricted Subsidiaries consists Subsidiary is in the form of cash, cash equivalents or Cash Equivalentsmarketable securities; provided that that, solely for purposes of this clause (2), each calculating such 75% of the following shall be considered cash or Cash Equivalents:
consideration, the amount of (i) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes notes thereto) (other than Subordinated Debt or other obligations or , excluding contingent liabilities subordinated in right of payment to the Notes) and trade payables), of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Senior Notes) that are assumed by the transferee of law or a customary novation agreement,
any such assets and (ii) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any no event within 90 more than 30 days of the closingafter receipt, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received), and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below)cash and cash equivalents for purposes of this provision. For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Any Net Cash Proceeds from an any Asset Sale for general corporate purposes (including a reduction that are not applied or invested as provided in borrowings under any revolving credit facilitySection 4.14(a) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c)shall constitute "Excess Proceeds."
(dc) When the aggregate amount of Net Cash Excess Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million 10,000,000 (“Excess Proceeds”such date being an "Asset Sale Trigger Date"), the Issuers must, within 30 days, Company shall make an Offer to all Holders of Senior Notes to purchase the maximum principal amount of the Senior Notes then outstanding that may be purchased out of Excess Proceeds that remain upon completion of the Excess Proceeds offer required under the Series A/B Indenture, at an offer price in cash in an amount equal to purchase100% of principal amount thereof plus any accrued and unpaid interest and Liquidated Damages, if any, to the Purchase Date in accordance with Section 3.02, Notes having a principal amount equal to:the procedures set forth in this Indenture.
(id) accumulated To the extent that any Excess ProceedsProceeds remain after completion of an Offer, multiplied bythe Company may use such remaining amount for general corporate purposes.
(iie) a fraction (x) If the numerator of which is equal to the outstanding aggregate principal amount of Senior Notes surrendered by Holders thereof exceeds the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of Excess Proceeds, the Trustee shall select the Senior Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount purchased on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount basis.
(and in a minimum amount of $1,000f) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of an Asset Sale Offer, the Offer to Purchase, amount of Excess Proceeds will shall be reset at zero.
(g) Notwithstanding the foregoing, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase that any or all of the Notes Net Proceeds of an Asset Sale is prohibited or delayed by applicable local law from being repatriated to the United States, the portion of such Net Proceeds so affected will not be required to be applied pursuant to an Offer Section 4.14, but may be retained for so long, but only for so long, as the applicable local law prohibits repatriation to Purchase pursuant the United States. The Company shall promptly take all reasonable actions required by the applicable local law to this Section 4.09. To the extent that the provisions permit such repatriation, and once such repatriation of any securities laws or regulations conflict with Section 4.09 or Section 3.02affected Net Proceeds is not prohibited under applicable local law, such repatriation will be immediately effected and such repatriated Net Proceeds will be applied in the Issuers shall comply with manner set forth above as if such Asset Sale have occurred on the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue date of such conflictrepatriation.
Appears in 1 contract
Sources: Indenture (Motors & Gears Inc)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any Restricted Subsidiary to, make any Asset Sale unless (i) the following conditions are met:
Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the Fair Market Value (aas evidenced by a resolution of the Board of Directors set forth in an Officers' Certificate delivered to the Trustee) of the assets or other property sold or disposed of in the Asset Sale is for at least Fair Market Value; and
and (bii) at least 75% of the such consideration received by the Company or its Restricted Subsidiaries consists of either cash or Cash Equivalents; provided provided, however, that for purposes of this clause Section 4.16, "cash" shall include (2), each of the following shall be considered cash or Cash Equivalents:
(ix) the assumption by the purchaser amount of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) any Indebtedness (other than Subordinated Debt or other obligations or liabilities any Indebtedness that is by its terms subordinated in right of payment to the Notes) of the Company or a such Restricted Subsidiary pursuant as shown on the Company's or such Restricted Subsidiary's most recent balance sheet or in the notes thereto that is assumed by the transferee of any such assets or other property in such Asset Sale (and excluding any liabilities that are incurred in connection with or in anticipation of such Asset Sale), but only to operation the extent that such assumption is effected on a basis such that there is no further recourse to the Company or any of law or a customary novation agreement,
the Restricted Subsidiaries with respect to such liabilities and (iiy) Additional Assets,
(iii) instruments, any notes, obligations or securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event converted within 90 60 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received, and).
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(cb) Within 360 365 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Company may elect to apply the Net Cash Proceeds may be used:
from such Asset Sale to (ia) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Senior Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to and/or (b) make an acquisition referred to investment in, or acquire assets and properties that will be used in, the business of the Company and the Restricted Subsidiaries existing on the Issue Date or in clause (ii) or (iii) above shall be treated as a permitted businesses reasonably related thereto. Pending the final application of the any such Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09Proceeds, the Company or any Restricted Subsidiary may use temporarily reduce Indebtedness of the Company under any New Credit Facility or temporarily invest such Net Cash Proceeds in any Investments described under clauses (i) through (iii) of the definition of Permitted Investments. Any Net Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to not applied or invested as provided in the first sentence of this Section 4.09(c)4.16(b) within 365 days of such Asset Sale will be deemed to constitute "Excess Proceeds."
(dc) When Each date that the aggregate amount of Net Cash Excess Proceeds from in respect of which an Asset Sales Sale Offer (as defined below) has not applied been made exceeds $5.0 million shall be deemed an "Asset Sale Offer Trigger Date." As soon as practicable, but in no event later than 20 business days after each Asset Sale Offer Trigger Date, the Company shall commence an offer (an "Asset Sale Offer") to purchase the maximum principal amount of Notes that may be purchased out of the Excess Proceeds. Any Notes to be purchased pursuant to (and within an Asset Sale Offer shall be purchased pro rata based on the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes outstanding, and (y) the denominator of which is all Notes shall be purchased at an offer price in cash in an amount equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof, plus accrued interest toand unpaid interest, but excluding if any, to the date of purchase. If To the Offer to Purchase extent that any Excess Proceeds remain after completion of an Asset Sale Offer, the Company may use the remaining amount for general corporate purposes otherwise permitted by this Indenture. In the event that the Company is for less than all prohibited under the terms of any agreement governing outstanding Senior Debt of the Company from repurchasing Notes with Excess Proceeds pursuant to an Asset Sale Offer as set forth in the first sentence of this Section 4.16(c), the Company shall promptly use all Excess Proceeds to permanently reduce such outstanding Senior Debt of the Company. Upon the consummation of any Asset Sale Offer, the amount of Excess Proceeds shall be deemed to be reset to zero.
(d) Notice of an Asset Sale Offer shall be mailed, by first-class mail (with a copy to the Trustee), by the Company not later than the 20th business day after the related Asset Sale Offer Trigger Date to each holder of Notes at such holder's registered address, stating: (i) that an Asset Sale Offer Trigger Date has occurred and that the Company is offering to purchase the maximum principal amount of Notes that may be purchased out of the Excess Proceeds (to the extent provided in the immediately preceding paragraph), at an offer price in cash in an aggregate amount equal to 100% of the principal amount in excess thereof, plus accrued and unpaid interest, if any, to the date of the purchase (the "Asset Sale Offer Purchase Date"), which shall be a business day, specified in such notice, that is not earlier than 30 days or later than 60 days from the date such notice is mailed, (ii) the amount are of accrued and unpaid interest, if any, as of the Asset Sale Offer Purchase Date, (iii) that any Note not tendered and not withdrawn will continue to accrue interest, (iv) that, unless the Company defaults in the payment of the purchase price for the Notes payable pursuant to the offerAsset Sale Offer, any Notes accepted for payment pursuant to the Asset Sale Offer shall cease to accrue interest after the Asset Sale Offer Purchase Date, (v) that Holders electing to have a Note purchased pursuant to a Asset Sale Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day prior to the Asset Sale Offer Purchase Date, (vi) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Asset Sale Offer Purchase Date, a facsimile transmission or letter setting forth the name of the Holder, the Issuers shall principal amount of the Notes the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased, (vii) ▇▇▇▇ Holders whose Notes having an aggregate are purchased only in part will be issued new Notes in a principal amount equal to the unpurchased portion of the Notes surrendered; provided, however, that each Note purchased and each new Note issued shall be in an original principal amount of $1,000 or integral multiples thereof (or if the Notes purchased were issued in lesser denominations, such lesser denomination), and (viii) such other information as may be required by applicable laws and regulations.
(e) On the Asset Sale Offer Purchase Date, the Company will (i) accept for payment the maximum principal amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer that can be purchased out of Excess Proceeds from such Asset Sale that are to be applied to an Asset Sale Offer, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the aggregate purchase amount price of all Notes or portions thereof accepted for payment, and (iii) deliver or cause to be delivered to the Trustee all Notes tendered pursuant to the Asset Sale Offer. If less than all Notes tendered pursuant to the Asset Sale Offer are accepted for payment by the Company for any reason consistent with this Indenture, selection of the Notes to be purchased by the Company shall be in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not so listed, on a pro rata basis to the extent practicableor by lot; provided, with adjustments by the Company so however, that Notes accepted for payment in part shall only Notes be purchased in integral multiples of $1,000 1,000. The Paying Agent shall promptly mail to each holder of Notes or portions thereof accepted for payment an amount equal to the purchase price for such Notes plus accrued and unpaid interest, if any, thereon, and the Trustee shall promptly authenticate and mail to such holder of Notes accepted for payment in part a new Note equal in principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and to any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the unpurchased portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zeroNotes, and any Excess Proceeds remaining Note not accepted for payment in whole or in part shall be promptly returned to the holder of such Note. On and after consummation an Asset Sale Offer Purchase Date, interest will cease to accrue on the Notes or portions thereof accepted for payment, unless the Company defaults in the payment of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenturepurchase price therefor. The Issuers shall Company will publicly announce the results of the Asset Sale Offer on or as soon as practicable after the Asset Sale Offer Purchase Date.
(f) This Section 4.16 will not apply to a transaction consummated in compliance with Article Five.
(g) The Company will comply with the applicable tender offer rules, including the requirements of Section 14(e) and Rule 14e-1 under the Exchange Act Act, and any all other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations in connection with any Asset Sale Offer and shall not will be deemed not to have breached their obligations be in violation of any of the covenants under this Section 4.09 or Section 3.02 by virtue of Indenture to the extent such conflictcompliance is in conflict with such covenants.
Appears in 1 contract
Sources: Indenture (Hawk Motors Inc)
Limitation on Asset Sales. (a) The Company shall will not, and shall will not cause or permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Asset Sale is for Company or such applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least equal to the Fair Market ValueValue of the assets sold or otherwise disposed of; and
(bii) at least 75not less than 80% of the consideration received by the Company or its such applicable Restricted Subsidiaries consists Subsidiary, as the case may be, is in the form of (a) cash or Cash Equivalents; provided that for purposes of this clause Equivalents or (2b) Replacement Assets, and in each case set forth in clauses (a) and (b), each is received at the time of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt such sale or other obligations or liabilities disposition; PROVIDED that the amount of (as shown on the Company’s most recent balance sheet or in the footnotes theretox) any Indebtedness (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the NotesIndebtedness) of the Company or a any such applicable Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
that is actually assumed by the transferee in such Asset Sale and from which the Company and its Restricted Subsidiaries are fully and unconditionally released and (iiy) Additional Assets,
(iii) instruments, notes, any securities or other obligations received by the Company or any such applicable Restricted Subsidiary from the purchaser that which are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents within five Business Days of such Asset Sale (to the extent of the cash or Cash Equivalents actually so received), and
will be deemed to be cash for purposes of this clause (ivii); and (iii) any Designated Non-Cash Consideration the Asset Sale Proceeds received by the Company or such Restricted Subsidiary in Subsidiary, as the Asset Sale having an aggregate Fair Market Valuecase may be, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstandingare applied, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business option of the Company or one such Restricted Subsidiary, (a) to prepay, repay or more purchase indebtedness under the New Credit Facilities or any other secured Indebtedness of the Company or such Restricted SubsidiariesSubsidiary; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iiib) above shall be treated as a permitted application to an investment in properties and assets that are used or useful in the business of the Net Cash Company or its Restricted Subsidiaries or in businesses reasonably similar to or ancillary to the business of the Company or its Restricted Subsidiaries as conducted at the time of such Asset Sale; PROVIDED that (1) such investment occurs or (2) the Company or any such Restricted Subsidiary enters into contractual commitments to so apply such Asset Sale Proceeds, subject only to customary conditions (other than the obtaining of financing), in each case, within 365 days following the receipt of such Asset Sale Proceeds; or (c) if on such 365th day, the Available Asset Sale Proceeds from exceed $15,000,000, the Company shall apply an amount equal to the Available Asset Sale Proceeds to an offer to repurchase the Notes (and, at its option, to an offer to repurchase other equal and ratable Indebtedness; PROVIDED that the stated maturity date of such commitment; provided that (x) such investment Indebtedness is consummated within 180 days no later than the stated maturity date of the end Notes), at a purchase price in cash equal to 100% of the 360-day period referred principal amount thereof plus accrued and unpaid interest, if any, to in the first sentence of this paragraph and purchase date (y) if such acquisition an "EXCESS PROCEEDS OFFER"). If an Excess Proceeds Offer is not consummated within the period set forth in clause (x) or such binding commitment is terminatedfully subscribed, the Net Cash Company may retain and use for general corporate purposes the portion (any such portion, a "DEFICIENCY") of the Available Asset Sale Proceeds not so applied will required to repurchase Notes. Upon completion of any Excess Proceeds Offer, the amount of Available Asset Sale Proceeds shall be deemed reset to be Excess zero; PROVIDED that the amount of the 25% Available Asset Sale Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an ) shall constitute Available Asset Sale Proceeds for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in first Excess Proceeds Offer that is made after the first sentence fifth anniversary of this Section 4.09(cthe Issue Date (the "FIFTH ANNIVERSARY").
(db) When Notwithstanding the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchaseforegoing, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) no event shall the numerator Company use Available Asset Sale Proceeds to purchase more than 25% of which is equal to the outstanding original aggregate principal amount of the Notes and (y) the denominator of which is equal on or prior to the outstanding Fifth Anniversary. If the aggregate Available Asset Sale Proceeds (disregarding any resetting to zero as described in paragraph (a) above) resulting from Asset Sales occurring on or prior to the Fifth Anniversary, less any Deficiencies resulting from any Excess Proceeds Offers made by the Company on or prior to such date, exceed 25% of the original aggregate principal amount of the Notes (such excess being the "25% AVAILABLE ASSET SALE PROCEEDS"), then the Company shall make an Excess Proceeds Offer in accordance with the foregoing provisions (i) promptly after the Fifth Anniversary, in the event the amount of the 25% Available Asset Sale Proceeds exceeds $15,000,000 or (ii) at such time as the amount of the 25% Available Asset Sale Proceeds together with Available Asset Sale Proceeds realized after the Fifth Anniversary exceeds $15,000,000, in the event the amount of the 25% Available Asset Sale Proceeds is less than $15,000,000.
(c) If the Company is required to make an Excess Proceeds Offer, the Company shall (i) notify the Trustee thereof at least five Business Days prior to the commencement of the Excess Proceeds Offer and all Debt secured (ii) send by Liens first-class mail, postage prepaid, within 30 days following the date specified in clause (iii)(c) of paragraph (a) above, a notice to the Trustee and to each Holder, at the address appearing in the register maintained by the Registrar, stating the information set forth below. The Excess Proceeds Offer shall remain open for a period of 20 Business Days following its commencement (the "OFFER PERIOD"). The notice, which shall govern the terms of the Excess Proceeds Offer, shall state:
(1) that the Excess Proceeds Offer is being made pursuant to this Section 4.10 and the length of time the Excess Proceeds Offer will remain open;
(2) the purchase price and the purchase date (which shall be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is mailed);
(3) that any Note not tendered or accepted for payment will continue to accrue interest;
(4) that, unless the Company defaults in a payment pursuant to the Excess Proceeds Offer, any Notes accepted for payment pursuant to the Excess Proceeds Offer shall cease to accrue interest after the expiration of the Offer Period;
(5) that Holders electing to have a Note purchased pursuant to any Excess Proceeds Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the Collateral ranking pari passu with reverse of the Liens Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Collateral securing Business Day preceding the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes date;
(6) that Holders will be 100% entitled to withdraw their election if the Paying Agent receives, not later than the expiration of the Offer Period, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes Note the Holder delivered for purchase and Notes in an a statement that such Holder is withdrawing his election to have such Note purchased;
(7) that, if the aggregate principal amount in excess of Notes surrendered by Holders exceeds the purchase amount are tendered and not withdrawn pursuant to the offerAvailable Asset Sale Proceeds, the Issuers Company or the Trustee shall purchase select the Notes having an aggregate principal amount equal to the purchase amount be purchased on a pro rata PRO RATA basis to the extent practicable, (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of US$1,000, or integral multiples of $1,000 thereof, shall be purchased);
(8) that Holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount (to the unpurchased portion of the Notes surrendered; PROVIDED that each Note purchased and each such new Note issued shall be in a minimum an original principal amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 US$1,000 and any integral multiple multiples thereof; and
(9) the calculations used in determining the amount of $1.00 in excess thereof with respect Available Asset Sale Proceeds to a PIK Note or be applied to the portion purchase of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenturesuch Notes. The Issuers Company shall comply with the requirements of 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 connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09Excess Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with this Section 4.09 or Section 3.024.10, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.10 by virtue of such conflictthereof.
Appears in 1 contract
Sources: Indenture (Norske Skog Canada LTD)
Limitation on Asset Sales. (a) The Company shall will not, and shall will not cause or permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Asset Sale is for Company or such applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least equal to the Fair Market ValueValue of the assets sold or otherwise disposed of; and
(bii) at least 75not less than 80% of the consideration received by the Company or its such applicable Restricted Subsidiaries consists Subsidiary, as the case may be, is in the form of (A) cash or Cash Equivalents; provided that for purposes Equivalents or (B) Replacement Assets, and in each case set forth in subclauses (A) and (B) of this clause (2a)(ii), each is received at the time of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt such sale or other obligations or liabilities disposition; PROVIDED that the amount of (as shown on the Company’s most recent balance sheet or in the footnotes thereto1) any Debt (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the NotesDebt) of the Company or a any such applicable Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
that is actually assumed by the transferee in such Asset Sale and from which the Company and its Restricted Subsidiaries are fully and unconditionally released and (ii2) Additional Assets,
(iii) instruments, notes, any securities or other obligations received by the Company or any such applicable Restricted Subsidiary from the purchaser that which are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents within ten Business Days of such Asset Sale (to the extent of the cash or Cash Equivalents actually so received), and
will be deemed to be cash for purposes of this clause (iva)(ii); and (iii) any Designated Non-Cash Consideration the Asset Sale Proceeds received by the Company or such Restricted Subsidiary in Subsidiary, as the Asset Sale having an aggregate Fair Market Valuecase may be, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstandingare applied, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after option of the receipt of any Net Cash Proceeds from an Asset SaleCompany or such Restricted Subsidiary, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding to prepay, repay or purchase indebtedness under the New Credit Agreement (and, in the case Facilities or any other secured Debt of the repayment of Company or such Restricted Subsidiary or the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) Pacifica Notes; or (B) to an investment in properties and assets that are used or are useful in the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business business of the Company or one its Restricted Subsidiaries or more Restricted Subsidiaries; provided that a binding commitment in businesses reasonably similar to make an acquisition referred or ancillary to in clause (ii) or (iii) above shall be treated as a permitted application the business of the Net Cash Proceeds from Company or its Restricted Subsidiaries as conducted at the date time of such commitmentAsset Sale; provided PROVIDED that (x1) such investment is consummated occurs or (2) the Company or any such Restricted Subsidiary enters into contractual commitments to so apply such Asset Sale Proceeds, subject only to customary conditions (other than the obtaining of financing), in each case, within 180 365 days following the receipt of such Asset Sale Proceeds; or (C) if on such 365th day the Available Asset Sale Proceeds exceed $15,000,000, the Company shall apply an amount equal to the Available Asset Sale Proceeds to an offer to repurchase the Notes (and, at its option, to an offer to repurchase other equal and ratable Debt), at a purchase price in cash equal to 100% of the end principal amount thereof plus accrued and unpaid interest, if any, to the purchase date (an "EXCESS PROCEEDS OFFER"). If an Excess Proceeds Offer is not fully subscribed, the Company may retain and use for general corporate purposes the portion (any such portion, a "DEFICIENCY") of the 360-day period referred Available Asset Sale Proceeds not required to in the first sentence repurchase Notes. Upon completion of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminatedany Excess Proceeds Offer, the Net Cash amount of Available Asset Sale Proceeds not so applied will shall be deemed reset to be Excess zero; PROVIDED that the amount of the 25% Available Asset Sale Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an ) shall constitute Available Asset Sale Proceeds for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in first Excess Proceeds Offer that is made after the first sentence fifth anniversary of this Section 4.09(cthe Issue Date (the "FIFTH ANNIVERSARY").
(db) When Even if the aggregate amount of Net Cash Proceeds from Company completes an Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchaseSale, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) no event shall the numerator Company use or be required to use Available Asset Sale Proceeds to purchase more than 25% of which is equal to the outstanding original aggregate principal amount of the Notes and (y) the denominator of which is equal on or prior to the outstanding Fifth Anniversary. If the aggregate Available Asset Sale Proceeds (disregarding any resetting to zero as described in paragraph (a) above) resulting from Asset Sales occurring on or prior to the Fifth Anniversary, less any Deficiencies resulting from any Excess Proceeds Offers made by the Company on or prior to such date, exceed 25% of the original aggregate principal amount of the Notes and all Debt secured by Liens on (such excess being the Collateral ranking pari passu "25% AVAILABLE ASSET SALE PROCEEDS"), then the Company shall make an Excess Proceeds Offer in accordance with the Liens on foregoing provisions (i) promptly after the Collateral securing Fifth Anniversary, in the Notes similarly event the amount of the 25% Available Asset Sale Proceeds exceeds $15,000,000 or (ii) at such time as the amount of the 25% Available Asset Sale Proceeds together with Available Asset Sale Proceeds realized after the Fifth -49- Anniversary exceeds $15,000,000, in the event the amount of the 25% Available Asset Sale Proceeds is less than $15,000,000.
(c) If the Company is required to be repaidmake an Excess Proceeds Offer, redeemed or tendered for in connection with the Asset Sale, rounded down Company shall (i) notify the Trustee thereof at least five Business Days prior to the nearest $1,000commencement of the Excess Proceeds Offer and (ii) send by first-class mail, postage prepaid, within 30 days following the date specified in clause (a)(iii)(C) of this Section 4.10, a notice to the Trustee and to each Holder, at the address appearing in the register maintained by the Registrar, stating the information set forth below. The Excess Proceeds Offer shall remain open for a period of 20 Business Days following its commencement (the "OFFER PERIOD"). The notice, which shall govern the terms of the Excess Proceeds Offer, shall state:
(1) that such Holders have the right to require the Company to apply the Available Asset Sale Proceeds, subject to the limitations under Section 4.10(b) hereof, to repurchase such Notes at a purchase price for the Notes will be in cash equal to 100% of the principal amount of the Notes, plus accrued interest toand unpaid interest, but excluding if any, to the purchase date;
(2) that the Excess Proceeds Offer is being made pursuant to this Section 4.10 and the length of time the Excess Proceeds Offer will remain open;
(3) the purchase price and the purchase date (which shall be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is mailed);
(4) that any Note not tendered or accepted for payment will continue to accrue interest;
(5) that, unless the Company defaults in a payment pursuant to the Excess Proceeds Offer, any Notes accepted for payment pursuant to the Excess Proceeds Offer shall cease to accrue interest after the expiration of purchase. If the Offer Period;
(6) that Holders electing to Purchase is for less than all have a Note purchased pursuant to any Excess Proceeds Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the outstanding Notes Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Business Day preceding the purchase date;
(7) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the expiration of the Offer Period, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and Notes in an a statement that such Holder is withdrawing his election to have such Note purchased;
(8) that, if the aggregate principal amount in excess of Notes surrendered by Holders exceeds the purchase amount are tendered and not withdrawn pursuant to the offerAvailable Asset Sale Proceeds, the Issuers Company or the Trustee shall purchase select the Notes having an aggregate principal amount equal to the purchase amount be purchased on a pro rata basis to the extent practicable, (with such adjustments as may be deemed appropriate by the -50- Company so that only Notes in denominations of US$1,000, or integral multiples of $1,000 thereof, shall be purchased);
(9) that Holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount (to the unpurchased portion of the Notes surrendered; PROVIDED that each Note purchased and each such new Note issued shall be in a minimum an original principal amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 US$1,000 and any integral multiple multiples thereof; and
(10) the calculations used in determining the amount of $1.00 in excess thereof with respect Available Asset Sale Proceeds to a PIK Note or be applied to the portion purchase of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenturesuch Notes. The Issuers Company shall comply with the requirements of 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 connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09Excess Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with this Section 4.09 or Section 3.024.10, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.10 by virtue of such conflictthereof.
Appears in 1 contract
Sources: Indenture (Norske Skog Canada LTD)
Limitation on Asset Sales. The Company shall not, and shall not permit any Restricted Subsidiary to, make any Asset Sale unless the following conditions are met:
(ai) the Company or the Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; and
equal to the fair market value of the assets sold or disposed of as determined by the good faith judgment of the Board of Directors evidenced by a Board Resolution and (bii) at least 7575.0% of the consideration received by the Company or its Restricted Subsidiaries for such Asset Sale consists of cash or Cash Equivalents; provided that for purposes of this clause (2), each of the following shall be considered cash equivalents or Cash Equivalents:
(i) the assumption by of unsubordinated Indebtedness. The Company shall, or shall cause the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a relevant Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instrumentsto, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the date of receipt of any the Net Cash Proceeds from an Asset Sale, the (i) (A) apply an amount equal to such Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under unsubordinated Indebtedness of the Credit Agreement (andCompany or Indebtedness of any Restricted Subsidiary, in each case, owing to a Person other than the case Company or any of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) its Restricted Subsidiaries or (B) invest an equal amount, or the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes amount not so applied pursuant to clause (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures A), in property or assets of a nature or type or that are used in a Permitted Business business (or in a Person having property and assets of a nature or type, or engaged in a business) similar or related to the nature or type of the property and assets of, or the business of, the Company or one or more and its Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from Subsidiaries existing on the date of such commitment; provided that investment (xas determined in good faith by the Board of Directors, whose determination shall be conclusive and evidenced by a Board Resolution) such investment is consummated within 180 days of and (ii) apply (no later than the end of the 360-day period referred to in the first sentence of this paragraph and (yabove) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the excess Net Cash Proceeds (to the extent not so applied will be deemed pursuant to be Excess Proceeds clause (i)) as defined below). For provided in the avoidance following paragraphs of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any 1017. The amount of such Net Cash Proceeds from an Asset Sale for general corporate purposes required to be applied (including a reduction in borrowings under any revolving credit facilityor to be committed to be applied) prior to the end of the during such 360-day period referred to above in the preceding sentence and not applied as so required by the end of such period shall constitute "Excess Proceeds". If, as of the first sentence day of this Section 4.09(c).
(d) When any calendar month, the aggregate amount of Net Cash Excess Proceeds from Asset Sales not applied pursuant theretofore subject to an Excess Proceeds Offer (and within the time frame set forth inas defined below) Section 4.09(c) exceeds totals at least $25.0 million (“Excess Proceeds”)10.0 million, the Issuers Company must, within 30 daysnot later than the 30th Business Day thereafter, make an offer (an "Excess Proceeds Offer") to purchase, in accordance with Section 3.02, Notes having purchase from the Holders on a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding pro rata basis an aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens Excess Proceeds on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaidsuch date, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The at a purchase price for the Notes will be 100equal to 100.0% of the principal amount plus of the Notes, plus, in each case, accrued and unpaid interest toand Liquidated Damages, but excluding if any, to the date of purchasepurchase (the "Excess Proceeds Payment"). If The Company shall 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 Purchase this Section 1017 and that all Notes validly tendered will be accepted for payment on a pro rata basis; (ii) the purchase price and the date of purchase (which shall be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is for less than all mailed) (the "Excess Proceeds Payment Date"); (iii) that any Note not tendered will continue to accrue interest pursuant to its terms; (iv) that, unless the Company defaults in the payment of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn Excess Proceeds Payment, any Note accepted for payment pursuant to the offerExcess Proceeds Offer shall cease to accrue interest and Liquidated Damages, if any, on and after the Excess Proceeds Payment Date; (v) that Holders electing to have a Note purchased pursuant to the Excess Proceeds Offer will be required to surrender the Note, together with the form entitled "Option of the Holder to Elect Purchase" on the reverse side of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Business Day immediately preceding the Excess Proceeds Payment Date; (vi) that Holders shall be entitled to withdraw their election if the Paying Agent receives, not later than the close of business on the third Business Day immediately preceding the Excess Proceeds Payment Date, a telegram, facsimile transmission or letter setting forth the name of such Holder, the Issuers principal amount of Notes delivered for purchase and a statement that such Holder is withdrawing his election to have such Notes purchased; and (vii) that Holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered; provided that each Note purchased and each new Note issued shall be in a principal amount of $1,000 or integral multiples thereof. On the Excess Proceeds Payment Date, the Company shall (i) accept for payment on a pro rata basis Notes 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 Notes having or portions thereof so accepted; and (iii) deliver, or cause to be delivered, to the Trustee all Notes or portions thereof so accepted together with an aggregate principal Officer's Certificate specifying the Notes or portions thereof accepted for payment by the Company. The Paying Agent shall promptly mail to the Holders of Notes so accepted payment in an amount equal to the purchase price, and the Trustee shall promptly authenticate and mail to such Holders a new Note equal in principal amount on to any unpurchased portion of the Note surrendered; provided that each Note purchased and each new Note issued shall be in a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples principal amount of $1,000 or integral multiples thereof. To the extent that the aggregate principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been madeNotes tendered is less than the Excess Proceeds, in denominations of $1.00 and the Company may use any integral multiple of $1.00 in excess thereof with respect to a PIK Note or remaining Excess Proceeds for general corporate purposes. The Company shall publicly announce the portion of a Global Note constituting PIK Interest). Upon completion results of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Offer as soon as practicable after the Excess Proceeds remaining after consummation Payment Date. For purposes of this Section 1017, the Offer to Purchase may be used for any purpose not otherwise prohibited by this IndentureTrustee shall act as the Paying Agent. The Issuers Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws rules and regulations thereunder to the extent such laws rules and regulations are applicable applicable, in connection with the purchase of event that such Excess Proceeds are received by the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations Company under this Section 4.09 or Section 3.02 by virtue of such conflict1017 and the Company is required to repurchase Notes as described above.
Appears in 1 contract
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s senior management or, in the case of an Asset Sale in excess of $5.0 million, the Board of Directors of the Company);
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of (x) cash or Cash Equivalents, (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business or (z) Capital Stock in one or more Persons engaged in a Permitted Business that are or thereby become Restricted Subsidiaries of the Company, and, in each case, such consideration is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser (other than liabilities that are promptlyby their terms subordinated to the Securities) that are assumed by the transferee of any such assets, but in and (b) any event within 90 days of notes or other securities received by the closing, Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 180 days after such Asset Sale (to the extent of the cash or Cash Equivalents actually so received, ) shall be deemed to be cash for the purposes of this provision only; and
(iviii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either:
(A) repay Indebtedness under the Credit Agreement and to correspondingly reduce commitments with respect thereto or to repay Indebtedness (other than Indebtedness subordinated to any Designated Non-Indebtedness) that is secured by a Lien permitted by this Indenture and to correspondingly reduce commitments with respect thereto;
(B) to make an Investment (x) in properties and assets that replace the properties and assets that were the subject of such Asset Sale, (y) in properties and assets that will be used by the Company or a Restricted Subsidiary in a Permitted Business or (z) permitted by clause (1) of the definition of “Permitted Investments” (collectively, “Replacement Assets”); or
(C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Pending the final application of the Net Cash Consideration received Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Indebtedness or otherwise invest such Net Cash Proceeds in any manner not prohibited by this Indenture. On the 361st day after an Asset Sale or such earlier date, if any, as the senior management or the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary in to make an offer to purchase (the Asset Sale having an aggregate Fair Market Value“Net Proceeds Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, taken together with from all other Designated Non-Cash Consideration received pursuant Holders on a pro rata basis, that amount of Securities equal to this clause (d) the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Securities to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, that if the Company is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in required by the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt terms of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking Indebtedness that ranks pari passu with the Liens securing Securities, such Net Proceeds Offer may be made ratably to purchase the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business Securities and such other Indebtedness of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of ranks pari passu with the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360Securities. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.18. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from an one or more Asset Sale for general corporate purposes Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $10.0 million, shall be applied as required pursuant to the end second preceding paragraph). In the event of the 360-day period referred transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the first sentence successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.09(c).
4.18, and shall comply with the provisions of clause (diii) When of this Section 4.18 with respect to such deemed sale as if it were an Asset Sale. In addition, the aggregate amount fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from Asset Sales not applied for purposes of this Section 4.18. Notice of each Net Proceeds Offer pursuant to (this Section 4.18 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to the record Holders as shown on the register of Holders at their last registered address, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and within materials necessary to enable such Holder to tender Securities pursuant to the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), Net Proceeds Offer and shall state the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal tofollowing terms:
(i) accumulated Excess Proceedsthat Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to prorationing as hereinafter described in the event the Net Proceeds Offer is oversubscribed) in integral multiples of $1,000 of principal amount, multiplied byat the applicable purchase price;
(ii) that the Net Proceeds Offer is being made pursuant to this Section 4.18 and that all Securities tendered will be accepted for payment; provided, however, that if the principal amount of Securities tendered in the Net Proceeds Offer exceeds the aggregate amount of the Net Proceeds Offer Amount, the Company shall select the Securities to be purchased on a fraction pro rata basis (xbased on amounts tendered);
(iii) the numerator purchase price (including the amount of accrued interest, if any) and the purchase date (which is equal shall be no earlier than 30 days nor later than 60 days from the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(iv) that any Security not tendered will continue to accrue interest;
(v) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the outstanding aggregate Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(vi) that Holders electing to have a Security purchased pursuant to the Net Proceeds Offer will be required to surrender the Security, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Offer Payment Date;
(vii) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes Security the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; and
(yviii) the denominator of which is that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers’ Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so to the Holder thereof. For purposes of this Section 4.18, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that only Notes in multiples of $1,000 principal amount (and in a minimum the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect the Securities tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.18, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.18 by virtue thereof. The provisions of such conflictthis Section 4.18 and other provisions contained in this Indenture relating to the Company’s obligation to make a Net Proceeds Offer may be waived or modified with the written consent of the Holders of a majority in principal amount of the Securities.
Appears in 1 contract
Limitation on Asset Sales. The Company shall not, and shall not permit any Restricted Subsidiary of its Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Company or the applicable Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; and
equal to the fair market value of the assets sold or otherwise disposed of (bas determined in good faith by the Company's Board of Directors), (ii) at least 75% of the consideration received for the assets sold by the Company or its Restricted Subsidiaries consists the Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash EquivalentsEquivalents and is received at the time of such disposition; provided provided, however, that (A) notes received by the Company as consideration for purposes of this clause (2), each of the following shall be considered an Asset Sale that are converted into cash or Cash Equivalents:
Equivalents immediately following the consummation of such Asset Sale or (iB) the assumption by the purchaser of Debt or other obligations or assets pursuant to an Asset Sale of liabilities (as shown on of the Company’s most recent balance sheet or in the footnotes thereto) Company (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment that are by their terms subordinate to the NotesSecurities) shall, in each case of the Company or a Restricted Subsidiary pursuant immediately preceding clauses (A) and (B), be deemed to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the be cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes of such Asset Sale in valuean amount equal to, in the case of clause (A);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net amount of cash or Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (Equivalents realized on such conversion and, in the case of clause (B), the repayment amount of the revolving credit facility under liabilities so assumed, as reflected on the Credit Agreementbalance sheet of the Company, and (iii) following the consummation of an Asset Sale, the Company shall, or shall cause such Subsidiary, within 365 days of receipt thereof either (A) to permanently reduce apply the commitment thereunder Net Cash Proceeds related to such Asset Sale to prepay any Indebtedness that by its terms is not subordinate to the Securities, (B) to make a Permitted Investment or an investment in properties and assets that replace the properties and assets that were the subject of such amountAsset Sale or in properties and assets that will be used in a Related Business (collectively, "Replacement Assets") or (BC) a combination of prepayment and investment permitted by the Notes foregoing clauses (iii)(A) and any Debt secured by Liens ranking pari passu with (iii)(B). On the Liens securing the Notes (365th day after an Asset Sale, or such earlier date, if any) through making , as the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business Board of Directors of the Company or one or more Restricted Subsidiaries; provided that a binding commitment of such Subsidiary determines not to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of apply the Net Cash Proceeds from the date of relating to such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period Asset Sale as set forth in clause clauses (xiii)IA), (iii) or (B) and (iii) (C) of the next preceding sentence (each, a "Net Proceeds Offer Trigger Date"), such binding commitment is terminated, the aggregate amount of Net Cash Proceeds which have not so been applied will be deemed to be Excess on or before the applicable Net Proceeds Offer Trigger Date as permitted in clauses (as defined belowiii)(A). For , (iii)(B) and (iii)(C) of the avoidance next preceding sentence (or, in the case of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any a Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) Offer Trigger Date occurring prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When such 365th day, the aggregate amount of Net Cash Proceeds from Asset Sales that the Board of Directors has determined not to so apply) (each, a "Net Proceeds Offer Amount") shall be applied pursuant by the Company or such Subsidiary to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchasepurchase (the "Net Proceeds Offer") on a date (the "Net Proceeds Offer Payment Date") not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, in accordance from all Holders on a pro rata basis (and on a pro rata basis with Section 3.02the holders of Indebtedness of the Company that is not by its terms subordinate to the Securities), Notes having a principal that amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is Securities equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is Net Proceeds Offer Amount at a price equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount of the Securities to be purchased, plus accrued and unpaid interest tothereon, but excluding if any, to the date of purchase. If ; provided, however, that if at any time any non-cash consideration received by the Offer to Purchase is for less than all Company or any Subsidiary of the outstanding Notes Company, as the case may be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and Notes the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.17. The Company may defer the Net Proceeds Offer until there is an aggregate principal unutilized Net Proceeds Offer Amount equal to or in excess of $5.0 million resulting from one or more Asset Sales (at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in excess of $5.0 million, shall be applied as required pursuant to this paragraph). In the purchase amount are tendered event of the transfer of substantially all (but not all) of the property and assets of the Company and its Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01, the successor corporation shall be deemed to have sold the properties and assets of the Company and its Subsidiaries not withdrawn so transferred for purposes of this Section 4.17, and shall comply with the provisions of this Section 4.17 with respect to such deemed sale as if it were an Asset Sale. In addition, the fair market value of such properties and assets of the Company or its Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this Section 4.17. Notwithstanding the two immediately preceding paragraphs, the Company and its Subsidiaries will be permitted to consummate an Asset Sale without complying with such paragraphs to the extent (i) at least 75% of the consideration for such Asset Sale constitutes Replacement Assets and (ii) such Asset Sale is for fair market value; provided that any consideration not constituting Replacement Assets received by the Company or any of its Subsidiaries in connection with any Asset Sale permitted to be consummated under this paragraph shall constitute Net Cash Proceeds subject to the provisions of the two preceding paragraphs. Notice of each Net Proceeds Offer pursuant to this Section 4.17 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. The notice shall contain all instructions and materials necessary to enable such Holders to tender Securities pursuant to the offerNet Proceeds Offer and shall state the following terms:
(1) that the Net Proceeds Offer is being made pursuant to this Section 4.17 and that all Securities tendered will be accepted for payment; provided, however, that if the principal amount of Securities tendered in the Net Proceeds Offer exceeds the Net Proceeds Offer Amount, the Issuers Company shall select the Securities to be purchased on a pro rata basis;
(2) the Net Proceeds Offer price (including the amount of accrued interest, if any) and the Net Proceeds Offer Payment Date;
(3) that any Security not tendered will continue to accrue interest;
(4) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(5) that Holders electing to have a Security purchased pursuant to the Net Proceeds Offer will be required to surrender the Security, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Offer Payment Date;
(6) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Security the Holder delivered for purchase Notes having and a statement that such Holder is withdrawing his election to have such Security purchased; and
(7) that Holders whose Securities are purchased only in part will. be issued new Securities in a principal amount at maturity equal to the unpurchased portion of the Securities surrendered. On or before the Net Proceeds Offer Payment Date, the Company shall (i) accept for payment Securities or portions thereof tendered pursuant to the Net Proceeds Offer, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an aggregate principal Officers' Certificate stating the Securities or portions thereof being purchased 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, plus accrued interest, if any, thereon and the Trustee shall promptly authenticate and mail to such Holders new Securities equal in principal amount on a pro rata basis to any unpurchased portion of the extent practicable, with adjustments Securities surrendered. Any Securities not so accepted shall be promptly mailed by the Company so that only Notes in multiples to the Holder thereof. For purposes of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased this Section 4.17, the Trustee shall act as the Paying Agent. Any Net Proceeds Offer shall remain open for at least 20 Business Days (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase such longer period as may be used for any purpose not otherwise prohibited required by this Indenturelaw) and until the close of business on the Net Proceeds Offer Payment Date. The Issuers Company shall comply with the requirements of Rule 14e-1 all tender offer rules under state and federal securities laws, including, but not limited to, Section 14(e) under the Exchange Act and any other securities laws and regulations thereunder Rule 14e-l thereunder, to the extent applicable to such laws and regulations are applicable in connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09offer. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02the foregoing provisions of this Indenture, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under the foregoing provisions of this Section 4.09 or Section 3.02 Indenture by virtue thereof. Upon completion of such conflicta Net Proceeds Offer, the amount of Net Cash Proceeds will be reset at zero. Accordingly, to the extent that the aggregate amount of Securities tendered pursuant to a Net Proceeds Offer is less than the Net Cash Proceeds, any remaining Net Cash Proceeds held by the Trustee shall be returned by the Trustee to the Company and the Company may use any remaining Net Cash Proceeds for general corporate purposes.
Appears in 1 contract
Sources: Indenture (Leslies Poolmart Inc)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company's Board of Directors);
(b2) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale is in the form of cash or Cash EquivalentsEquivalents and is received at the time of such disposition; provided that and
(3) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale (other than an Asset Sale consisting of (i) 10% or more of the Capital Stock of U.S. Fire or North River or (ii) assets of U.S. Fire or North River constituting more than 10% of the assets of U.S. Fire or North River, respectively, or (iii) assets of U.S. Fire or North River generating more than 10% of the consolidated gross premiums written of the Company for the most recently reported four fiscal quarters (any such sale, an "Excluded Sale")), within 180 days of receipt thereof to make an investment in an Insurance Subsidiary (whether then owned or then acquired).
(b) For purposes of this clause (2)) above, each of the following shall be considered cash or Cash Equivalents:
(iA) the assumption by the purchaser amount of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) any Indebtedness of the Company or a any Restricted Subsidiary pursuant actually assumed by the transferee in such Asset Sale and from which the Company and the Restricted Subsidiaries are fully and unconditionally released shall be deemed to operation be cash, and (B) the amount of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, any notes, securities or other similar obligations received by the Company or any Restricted Subsidiary from such transferee that are immediately converted, sold or exchanged by the Company or the Restricted Subsidiaries into cash or Cash Equivalents shall be deemed to be cash.
(c) On the 181st day after any Asset Sale (or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary from determines not to apply the purchaser Net Cash Proceeds relating to such Asset Sale as set forth in clause (3) of Section 4.10(a) or on the date of consummation of an Excluded Sale) such date, a "Net Proceeds Offer Trigger Date"), the aggregate amount of such Net Cash Proceeds (that are promptlyhave not been applied as set forth in clause (3) of Section 4.10(a) on or before such Net Proceeds Offer Trigger Date in the case of any Asset Sale other than an Excluded Sale) (each, but in any event within 90 days of the closing, converted a "Net Proceeds Offer Amount") shall be applied by the Company or such Restricted Subsidiary to cash or Cash Equivalentsmake an offer to purchase (a "Net Proceeds Offer") on a date (the "Net Proceeds Offer Payment Date") not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, from all Holders on a pro rata basis, that amount of Notes equal to the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Notes to be purchased, plus accrued and unpaid interest thereon, if any, to the extent date of the purchase; provided, however, that if at any time any non-cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction thereof shall be applied in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this accordance with Section 4.09(c)4.10.
(d) When The Company may defer the Net Proceeds Offer until there is an aggregate amount unutilized Net Proceeds Offer Amount equal to or in excess of Net Cash Proceeds $10.0 million resulting from one or more Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)at which time, the Issuers mustentire unutilized Net Proceeds Offer Amount, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) and not just the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn $10.0 million, shall be applied as required pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interestthis covenant). Upon completion of If the Net Proceeds Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after Amount exceeds the amount paid upon consummation of the Offer to Purchase Net Proceeds Offer, the Company may be used use any such excess amount for any purpose not otherwise prohibited by this Indenture. Upon completion of each Net Proceeds Offer, the unutilized Net Proceeds Offer Amount shall be reset to zero.
(e) In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section, and shall comply with the provisions of this Section with respect to such deemed sale as if it were an Asset Sale. In addition, the fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this Section.
(f) Each Net Proceeds Offer will be mailed to the record Holders as shown on the register of Holders within 25 days following the Net Proceeds Offer Trigger Date, with a copy to the Trustee, and shall comply with the procedures set forth in this Indenture. Upon receiving notice of the Net Proceeds Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1,000 in exchange for cash. To the extent Holders properly tender Notes in an amount exceeding the Net Proceeds Offer Amount, Notes of tendering Holders will be purchased on a pro rata basis (based on amounts tendered). A Net Proceeds Offer shall remain open for a period of 20 business days or such longer period as may be required by law.
(g) The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02the provisions of this Indenture, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under such provisions of this Section 4.09 or Section 3.02 Indenture by virtue of such conflictthereof.
Appears in 1 contract
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s senior management or, in the case of an Asset Sale in excess of $4.0 million, the Board of Directors of the Company);
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of (x) cash or Cash Equivalents, (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business; provided that for purposes of this clause they are concurrently with their acquisition added to the Collateral securing the Securities to the extent required by the Security Documents, or (2), each z) Capital Stock in one or more Persons engaged in a Permitted Business that are or thereby become Restricted Subsidiaries of the following shall be considered cash or Cash Equivalents:
(i) Company; provided, further, that the assumption properties and assets of such Person are concurrently with the acquisition added to the Collateral securing the Securities to the extent required by the purchaser Security Documents, and, in each case, such consideration is received at the time of Debt or other obligations or such disposition; provided, further, however, that the amount of (a) any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser (other than (A) liabilities that are promptlyunsecured or secured by Liens junior to the Lien on the Collateral securing the Securities and (B) liabilities that are by their terms subordinated to the Securities) that are assumed by the transferee of any such assets, but in and (b) any event within 90 days of notes or other securities received by the closing, Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 30 days after such Asset Sale (to the extent of the cash or Cash Equivalents actually so received, ) shall be deemed to be cash for the purposes of this provision only; and
(iviii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 365 days of receipt thereof either:
(A) to prepay any Designated NonFirst-Lien Obligations and, in the case of any First-Lien Obligations under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility (or effect a permanent reduction in availability under such revolving credit facility regardless of the fact that no prepayment is required);
(B) to make an Investment (x) in properties and assets that replace the properties and assets that were the subject of such Asset Sale or (y) in properties and assets that will be used by the Company or a Restricted Subsidiary in a Permitted Business; or
(C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Pending the final application of the Net Cash Consideration received Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Indebtedness that constitutes First-Lien Obligations or otherwise invest such Net Cash Proceeds in any manner not prohibited by this Indenture. On the 366th day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred offer to in clause purchase (iithe “Net Proceeds Offer”) or on a date (iiithe “Net Proceeds Offer Payment Date”) above shall be treated as not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, from all Holders on a permitted application pro rata basis, that amount of Securities equal to the Net Proceeds Offer Amount at a price equal to 100% of the Net Cash Proceeds from principal amount of the Securities to be purchased, plus accrued and unpaid interest thereon, if any, to the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360purchase. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.18. If the First-Lien Obligations Termination Date has occurred at the time of the receipt of Net Cash Proceeds from an Asset Sale involving Collateral, such Net Cash Proceeds shall be delivered to and held by the Trustee as Trust Monies for general corporate purposes the benefit of the Notes Secured Creditors pending any use permitted by this Section 4.18. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from one or more Asset Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $10.0 million, shall be applied as required pursuant to the end of the 360-day period referred to in the first sentence second preceding paragraph of this Section 4.09(c4.18).. In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section, and shall comply with the provisions of clause (iii) of this Section 4.18 with respect to such deemed sale as if it were an Asset Sale. In addition, the fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this Section 4.18. Notice of each Net Proceeds Offer pursuant to this Section 4.18 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and materials necessary to enable such Holders to tender Securities pursuant to the Net Proceeds Offer and shall state the following terms:
(d1) When that Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to proration as hereinafter described in the event the Net Proceeds Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price;
(2) that the Net Proceeds Offer is being made pursuant to this Section 4.18 and that all Securities tendered will be accepted for payment; provided, however, that if the principal amount of Securities tendered in the Net Proceeds Offer exceeds the aggregate amount of the Net Cash Proceeds Offer Amount, the Company shall select the Securities to be purchased on a pro rata basis (based on amounts tendered);
(3) the purchase price (including the amount of accrued interest, if any) and the Net Proceeds Offer Purchase Date (which shall be no earlier than 30 days nor later than 60 days from Asset Sales the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(4) that any Security not applied tendered will continue to accrue interest;
(5) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(and within 6) that Holders electing to have a Security purchased pursuant to the time frame set Net Proceeds Offer will be required to surrender the Security, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day prior to the Net Proceeds Offer Payment Date;
(7) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)the name of the Holder, the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes Security the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; and
(y) the denominator of which is 8) that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers’ Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon, set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so to the Holder thereof. For purposes of this Section 4.18, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that only Notes in multiples of $1,000 principal amount (and in a minimum the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect the Securities tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.18, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.18 by virtue thereof. The provisions of such conflictthis Section 4.18 and other provisions contained in this Indenture relating to the Company’s obligation to make a Net Proceeds Offer may be waived or modified with the written consent of the Holders of a majority in principal amount of the Securities.
Appears in 1 contract
Sources: Indenture (Clean Harbors Inc)
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company's senior management or, in the case of an Asset Sale in excess of $5.0 million, the Board of Directors of the Company);
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of (x) cash or Cash Equivalents, (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business or (z) Capital Stock in one or more Persons engaged in a Permitted Business that are or thereby become Restricted Subsidiaries of the Company, and, in each case, such consideration is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as -------- shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Securities) that are assumed by the transferee of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations securities received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 180 days after such Asset Sale (to the extent of the cash or Cash Equivalents actually so received, ) shall be deemed to be cash for the purposes of this provision only; and
(iviii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either:
(A) to prepay any Designated Non-Senior Debt or Guarantor Senior Debt or any Indebtedness of a Restricted Subsidiary that is not a Guarantor and, in the case of any Senior Debt or Guarantor Senior Debt or Indebtedness of a Restricted Subsidiary that is not a Guarantor under any revolving credit facility, effect a per- manent reduction in the availability under such revolving credit facility (or effect a permanent reduction in availability under such revolving credit facility regardless of the fact that no prepayment is required);
(B) to make an Investment (x) in properties and assets that replace the properties and assets that were the subject of such Asset Sale, (y) in properties and assets that will be used by the Company or a Restricted Subsidiary in a Permitted Business or (z) permitted by clause (1) of the definition of Permitted Investments (collectively, "Replacement Assets"); or ------------------
(C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Pending the final application of the Net Cash Consideration received Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Indebtedness or otherwise invest such Net Cash Proceeds in any manner not prohibited by this Indenture. On the 361st day after an Asset Sale or such earlier date, if any, as the senior management or the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each, a "Net Proceeds Offer Trigger Date"), such aggregate ------------------------------- amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each a "Net Proceeds Offer Amount") ------------------------- shall be applied by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred offer to in clause purchase (iithe "Net Proceeds Offer") or on a date (iiithe "Net Proceeds Offer ------------------ ------------------ Payment Date") above shall be treated as not less than 30 nor more than 60 days following the applicable ------------ Net Proceeds Offer Trigger Date, from all Holders on a permitted application pro rata basis, that amount of Securities equal to the Net Proceeds Offer Amount at a price equal to 100% of the Net Cash Proceeds from principal amount of the Securities to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, -------- ------- that if the Company is required by the terms of any Senior Subordinated Debt, such commitment; provided that (x) Net Proceeds Offer may be made ratably to purchase the Securities and such investment is consummated within 180 days other Senior Subordinated Debt of the end of the 360Company. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this Section. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from an one or more Asset Sale for general corporate purposes Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $10.0 million, shall be applied as required pursuant to the end second preceding paragraph). In the event of the 360-day period referred transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the first sentence successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section, and shall comply with the provisions of clause (iii) of this Section 4.09(c).
(d) When with respect to such deemed sale as if it were an Asset Sale. In addition, the aggregate amount fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from Asset Sales not applied for purposes of this Section 4.18. Notice of each Net Proceeds Offer pursuant to (this Section 4.18 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and within materials necessary to enable such Holders to tender Securities pursuant to the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), Net Proceeds Offer and shall state the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal tofollowing terms:
(i) accumulated Excess Proceedsthat Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to prorationing as hereinafter described in the event the Net Proceeds Offer is oversubscribed) in integral multiples of $1,000 of principal amount, multiplied byat the applicable purchase price;
(ii) a fraction (xiii) the numerator purchase price (including the amount of accrued interest, if any) and the purchase date (which is equal shall be no earlier than 30 days nor later than 60 days from the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(iv) that any Security not tendered will continue to accrue interest;
(v) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the outstanding aggregate Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(vi) that Holders electing to have a Security purchased pursuant to the Net Proceeds Offer will be required to surrender the Security, with the form entitled "Option of Holder to Elect Purchase" ---------------------------------- on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Offer Payment Date;
(vii) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes Security the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; and
(yviii) the denominator of which is that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers' Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so that only Notes in multiples to the Holder thereof. For purposes of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been madethis Section 4.18, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest)Trustee shall act as the Paying Agent. Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds Any amounts remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes Securities pursuant to an a Net Proceeds Offer shall be returned by the Trustee to Purchase pursuant to this Section 4.09the Company. To the extent that the provisions aggregate amount of the Securities tendered pursuant to a Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or for any other purposes not prohibited by this Indenture. Upon completion of any securities laws or regulations conflict with Section 4.09 or Section 3.02such Net Proceeds Offer, the Issuers Net Proceeds Offer Amount shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflictreset at zero.
Appears in 1 contract
Sources: Indenture (GSL Corp)
Limitation on Asset Sales. The Company shall ▇▇▇▇▇▇ Publishing will not, and shall will not cause or permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) ▇▇▇▇▇▇ Publishing or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by ▇▇▇▇▇▇ Publishing’s Board of Directors);
(b2) at least 75% of the consideration received by ▇▇▇▇▇▇ Publishing or the Company or its Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or cash, Cash Equivalents; provided that for purposes of this clause (2), each Equivalents and/or assets of the following shall be considered cash or Cash Equivalents:
same type having the same general utility as the subject assets, as determined by Issuer (“Replacement Assets”) and is received at the time of such disposition; provided, however, that the amount of (i) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company▇▇▇▇▇▇ Publishing’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes notes thereto) of ▇▇▇▇▇▇ Publishing or any such Restricted Subsidiary (other than Subordinated Debt or other obligations or liabilities that are by their terms subordinated in right of payment to the NotesNotes or any Guarantee of a Guarantor) that are assumed by the transferee of the Company or a Restricted Subsidiary pursuant any such assets shall be deemed to operation be cash for purposes of law or a customary novation agreement,
this provision and (ii) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company ▇▇▇▇▇▇ Publishing or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, immediately converted by the Company ▇▇▇▇▇▇ Publishing or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually received) shall be deemed, to the extent of cash so received, to be cash for purposes of this provision; and
(iv3) any Designated Non-Cash Consideration received by upon the Company consummation of an Asset Sale, ▇▇▇▇▇▇ Publishing shall apply, or cause such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Saleapply, the Net Cash Proceeds may be usedrelating to such Asset Sale within 180 days of receipt thereof:
(ia) to permanently repay (A) prepay any Senior Debt outstanding under the Credit Agreement (or Guarantor Senior Debt and, in the case of the repayment of the any Senior Debt or Guarantor Senior Debt under any revolving credit facility (other than the Working Capital Facility), effect a permanent reduction in the availability under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,revolving credit facility; and/or
(ii) to acquire Additional Assets; or
(iiib) to make capital expenditures in an offer to all Holders and the Tranche B Lender to reduce the balance on the Tranche B Loan and to repurchase the maximum principal amount of Notes, on a Permitted Business of the Company or one or more Restricted Subsidiaries; provided pro rata basis, that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall may be treated as a permitted application reduced and purchased out of the Net Cash Proceeds from (or the portion thereof not applied pursuant to clause (a) above) at a Purchase Price in cash in an amount equal to 101% of the principal amount thereof, together with accrued and unpaid interest to the date fixed for the closing of such commitment; provided that (x) such investment is consummated within 180 days of offer, in accordance with the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period procedures set forth in clause Section 3.10 (xa “Net Proceeds Offer”).
(4) or such binding commitment is terminatedNotwithstanding the foregoing, the all Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubtany Collateral in respect of any Asset Sale shall, pending their application thereof in accordance with this Section 4.094.10 or the release thereof in accordance with the provisions of the Security Documents, be deposited in an account subject to a deposit account control agreement as provided in the Security Documents. In the event of the transfer of substantially all (but not all) of the property and assets of ▇▇▇▇▇▇ Publishing and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the Company successor corporation shall be deemed to have sold the properties and assets of ▇▇▇▇▇▇ Publishing and its Restricted Subsidiaries not so transferred for purposes of this covenant, and shall comply with the provisions of this covenant with respect to such deemed sale as if it were an Asset Sale. In addition, the fair market value of such properties and assets of ▇▇▇▇▇▇ Publishing or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this covenant. ▇▇▇▇▇▇ Publishing will not, and will not cause or permit any of its Restricted Subsidiaries to, engage in any Asset Swaps, unless:
(1) at the time of entering into such Asset Swap and immediately after giving effect to such Asset Swap, no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof;
(2) in the event such Asset Swap involves the transfer by ▇▇▇▇▇▇ Publishing or any Restricted Subsidiary may use any Net Cash Proceeds from of assets having an aggregate fair market value in excess of $25.0 million, either (i) the terms of such Asset Sale for general corporate purposes Swap shall be approved by a majority of the Independent Directors of ▇▇▇▇▇▇ Publishing, but in no event fewer than two Independent Directors of ▇▇▇▇▇▇ Publishing, such approval to be evidenced by a Board Resolution stating that such Independent Directors have determined that such transaction complies with the foregoing provisions or, (including a reduction ii) in borrowings under any revolving credit facility) the event there are fewer than two such Independent Directors, ▇▇▇▇▇▇ Publishing shall, prior to the end consummation thereof, obtain a favorable opinion as to the fairness of such Asset Swap to ▇▇▇▇▇▇ Publishing or such Restricted Subsidiary, as the 360-day period referred to case may be, from a financial point of view, from an Independent Financial Advisor and file the same with the Trustee; and
(3) in the first sentence event such Asset Swap involves the transfer by ▇▇▇▇▇▇ Publishing or any Restricted Subsidiary of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes assets having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount fair market value in excess of the purchase amount are tendered and not withdrawn pursuant $50.0 million, ▇▇▇▇▇▇ Publishing shall, prior to the offerconsummation thereof, the Issuers shall purchase Notes having an aggregate principal amount equal obtain a favorable opinion as to the purchase amount on fairness of such Asset Swap to ▇▇▇▇▇▇ Publishing or such Restricted Subsidiary, as the case may be, from a pro rata basis to financial point of view, from an Independent Financial Advisor and file the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply same with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflictTrustee.
Appears in 1 contract
Limitation on Asset Sales. The Company shall not, and shall not cause or permit any Restricted Subsidiary to, make any directly or indirectly, consummate an Asset Sale unless the following conditions are met:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; and
equal to the fair market value of the assets sold or otherwise disposed of (bas determined in good faith by the Company's Board of Directors) and (ii) at least 7585% of the consideration received by the Company or its such Restricted Subsidiaries consists of Subsidiary, as the case may be, from such Asset Sale shall be cash or Cash Equivalents; provided that for purposes of this clause (2), each Equivalents and is received at the time of the following shall be considered cash or Cash Equivalents:
consummation of any such Asset Sale; PROVIDED, HOWEVER, that the amount of (ix) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's most recent balance sheet or in the footnotes notes thereto) of the Company or any Restricted Subsidiary (other than Subordinated Debt or other obligations or liabilities subordinated (i) Indebtedness subordinate in right of payment to the Notes, (ii) contingent liabilities, (iii) liabilities or Indebtedness to Affiliates of the Company and (iv) non-recourse Indebtedness or a Restricted Subsidiary pursuant other non-recourse liabilities) that are assumed by the transferee of any such assets and (y) to operation the extent of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instrumentsthe cash received, notes, securities any notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary into cash within 60 days of receipt, shall be deemed to be cash for purposes of this provision; PROVIDED, FURTHER, HOWEVER, that the 85% limitation referred to above shall not apply to any sale, transfer or other disposition of assets in which the cash portion of the consideration received therefor, determined in accordance with the foregoing proviso, is equal to or greater than what the after-tax net proceeds would have been had such transaction complied with the aforementioned 85% limitation. Upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash EquivalentsProceeds relating to such Asset Sale within 360 days of receipt thereof either (A) to reinvest in Productive Assets, or (B) to prepay or repay Indebtedness of the Company which ranks PARI PASSU with the Notes or to prepay or repay any Indebtedness of a Restricted Subsidiary of the Company (other than any non-recourse Indebtedness) in an amount not to exceed the product of (A) the amount of such Net Cash Proceeds and (B) a fraction, the numerator of which is the total aggregate principal amount of such PARI PASSU Indebtedness or such Indebtedness of Restricted Subsidiaries and the denominator of which is the aggregate of all such Indebtedness plus the aggregate Accreted Value (if the Net Proceeds Offer Payment Date is prior to June 15, 2000) or the aggregate principal amount (if the Net Proceeds Offer Payment Date is on or after June 15, 2000) of the Notes then outstanding. On the 361st day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (A) and (B) of the preceding sentence (each a "NET PROCEEDS OFFER TRIGGER DATE"), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (A) and (B) of the preceding sentence (each a "NET PROCEEDS OFFER AMOUNT") shall be applied by the Company or such Subsidiary to make an offer to purchase (the "NET PROCEEDS OFFER") on a date (the "NET PROCEEDS OFFER PAYMENT DATE") not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, from all Holders on a PRO RATA basis that amount of Notes equal to the Net Proceeds Offer Amount at a price in cash equal to 100% of the Accreted Value of the Notes on the Net Proceeds Offer Payment Date (if prior to June 15, 2000) or 100% of the principal amount thereof (if the Net Proceeds Offer Payment Date is on or after June 15, 2000) to be purchased, plus accrued and unpaid interest thereon, if any, to the extent date of the purchase; PROVIDED, HOWEVER, that if at any time any non-cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration consideration received by the Company or such Restricted any Subsidiary of the Company, as the case may be, in the connection with any Asset Sale having an aggregate Fair Market Valueis converted into or sold or otherwise disposed of for cash, taken together with all other Designated Non-Cash Consideration received pursuant then such conversion or disposition shall be deemed to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from constitute an Asset Sale, Sale hereunder and the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above thereof shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.094.16. To the extent that the Accreted Value of Notes on the Net Proceeds Offer Payment Date (if prior to June 15, 2000) or the aggregate principal amount of Notes (if the Net Proceeds Offer Payment Date is on or after June 15, 2000) tendered pursuant to the Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an remaining proceeds of such Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior but subject to the end of the 360-day period referred to in the first sentence terms of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK InterestIndenture). Upon completion of a Net Proceeds Offer, the Net Proceeds Offer Amount relating to Purchasesuch Net Proceeds Offer shall be deemed to be zero for purposes of any subsequent Asset Sale. Notwithstanding the foregoing, Excess if a Net Proceeds Offer Amount is less than $5,000,000, the application of the Net Cash Proceeds constituting such Net Proceeds Offer Amount to a Net Proceeds Offer may be deferred until such time as such Net Proceeds Offer Amount plus the aggregate amount of all Net Proceeds Offer Amounts arising subsequent to the Issue Date of the Notes from all Asset Sales by the Company and its Subsidiaries in respect of which a Net Proceeds Offer has not been made aggregates at least $5,000,000, at which time the Company or such Restricted Subsidiary shall apply all Net Cash Proceeds constituting all Net Proceeds Offer Amounts that have been so deferred to make a Net Proceeds Offer (each date on which the aggregate of all such deferred Net Proceeds Offer Amounts is equal to $5,000,000 or more shall be deemed to be a Net Proceeds Offer Trigger Date). In connection with any Asset Sale with respect to assets having a book value in excess of $5,000,000 or as to which it is expected that the aggregate consideration therefor to be received by the Company or any Restricted Subsidiary will exceed $5,000,000 in value, such transaction or series of transactions shall be reset at zeroapproved, prior to the consummation thereof, by the Board of Directors of the Company. In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01, the successor corporation shall be deemed to have sold the properties and assets of the Company and its Subsidiaries not so transferred for purposes of this covenant, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements provisions of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder this covenant with respect to such deemed sale as if it were an Asset Sale; PROVIDED, HOWEVER, that to the extent such laws and regulations are applicable in connection with that the purchase of Company is required to make an offer to repurchase the Notes pursuant to an Offer to Purchase pursuant to Section 4.15 in connection with any transaction that would otherwise be within the terms of this Section 4.09. To paragraph, the extent that Company need not comply with the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02this paragraph. In addition, the Issuers fair market value of such properties and assets of the Company or its Subsidiaries deemed to be sold shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under be Net Cash Proceeds for purposes of this Section 4.09 or Section 3.02 by virtue of such conflictcovenant.
Appears in 1 contract
Sources: Indenture (Cellnet Data Systems Inc)
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
unless: (ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least equal to the Fair Market ValueValue of the assets sold or otherwise disposed of; and
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash Equivalents; Equivalents or Replacement Assets and is received at the time of such disposition, provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet sheet) of the Company or in the footnotes thereto) any such Restricted Subsidiary (other than Subordinated Debt or other obligations or liabilities that are by their terms subordinated in right of payment to the Notes) that are assumed by the transferee of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, immediately converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash received), shall be deemed to be cash for the purposes of this provision; and (iii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Equivalents actually so receivedProceeds relating to such Asset Sale within 270 days of receipt thereof either (A) to (x) repay and permanently reduce the availability of credit under the Global Bank Facility or (y) repay and elect to reduce the amount of outstanding Indebtedness permitted to be incurred pursuant to clauses (x) and/or (xv) of the definition of Permitted Indebt- edness, and
(ivB) to make an investment in properties and assets that replace the properties and assets that were the subject of such Asset Sale or in properties and assets that will be used in the same or a similar line of business as the Company or the Restricted Subsidiary, as the case may be, as existing on the date of this Indenture or in businesses reasonably related thereto ("Replacement Assets"); provided that the Net Cash Proceeds from an Asset Sale relating to the Company's tobacco business are used to make an investment in Replacement Assets relating to the tobacco business; provided further that the Net Cash Proceeds of an Asset Sale relating to assets owned directly by the Issuer or a Guarantor are used to make an investment in Replacement Assets owned directly by the Issuer or a Guarantor, (C) to permanently reduce any Designated Non-outstanding Indebtedness of such Restricted Subsidiary (and to correspondingly reduce the commitments, if any, with respect thereto), or (D) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A), (iii)(B) and (iii)(C). On the 271st day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Consideration received Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B), (iii)(C) and (iii)(D) of the next preceding sentence (each, a "Net Proceeds Offer Trigger Date"), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B), (iii)(C) and (iii)(D) of the next preceding sentence (each, a "Net Proceeds Offer Amount") shall be applied by the Company or such Restricted Subsidiary in to make an offer to purchase (the Asset Sale having an aggregate Fair Market Value"Net Proceeds Offer") on a date (the "Net Proceeds Offer Payment Date") not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, taken together with from all other Designated Non-Cash Consideration received pursuant Holders on a pro rata basis, that amount of Notes equal to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) Offer Amount at a price equal to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case 100% of the repayment principal amount of the revolving credit facility under the Credit AgreementNotes to be purchased, plus accrued and unpaid interest thereon, if any, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business date of the Company or one or more Restricted Subsidiariespurchase; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360if at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or dissolution shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not thereof shall be applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02this covenant. The Company or such Restricted Subsidiary, Notes having a principal amount equal to:
(i) accumulated Excess Proceedsas the case may be, multiplied by
(ii) a fraction (x) may defer the numerator of which Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10 million resulting from one or more Asset Sales (at which time, the outstanding aggregate principal amount of entire unutilized Net Proceeds Offer Amount, and not just the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn $10 million shall be applied as required pursuant to this paragraph). Notwithstanding the offerforegoing, the Issuers restriction contained in clause (ii) of the preceding paragraph shall purchase Notes having an aggregate principal amount equal not apply if more than 49% of the Capital Stock or more than 49% of the consolidated assets of Standard Wool are sold in a single transaction in compliance with all of the terms of this Indenture. In connection with each Net Proceeds Offer, the Issuer shall send, by first class mail, a notice to each Holder, with a copy to the purchase Trustee, notice of such, within 25 days following the Net Proceeds Offer Trigger Date, and shall comply with the procedures set forth in this Indenture. Upon receiving notice of the Net Proceeds Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1,000 in exchange for cash. To the extent Holders properly tender Notes in an amount exceeding the Net Proceeds Offer Amount, Notes of tendering Holders shall be purchased on a pro rata basis to (based on amounts tendered). A Net Proceeds Offer shall remain open for a period of 20 business days or such longer Period as may be required by law. Notwithstanding the extent practicableforegoing, with adjustments all of the outstanding Capital Stock of the Issuer shall at all times be owned by the Company so that only Notes in multiples free and clear of $1,000 principal amount (and in a minimum amount all Liens other than the Liens held by the Trustee for the benefit of $1,000) will be purchased (or if a PIK Payment has been made, in denominations the Holders of $1.00 the Notes. The Company and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds such Restricted Subsidiaries will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of Rule 14e-1 under the Exchange Act and the regulations thereunder and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflicta Net Proceeds Offer.
Appears in 1 contract
Sources: Indenture (Standard Commercial Corp)
Limitation on Asset Sales. (a) The Company shall not, and shall not cause or permit any of its Restricted Subsidiary Subsidiaries to, make any complete an Asset Sale unless the following conditions are metunless:
(a1) the Asset Sale is for Company or such applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least equal to the Fair Market Value; andValue of the assets sold or otherwise disposed of;
(b2) at least not less than 75% of the consideration received by the Company or its such applicable Restricted Subsidiaries consists Subsidiary, as the case may be, is in the form of (A) cash or Cash Equivalents; provided that for purposes , or (B) Replacement Assets, and in each case set forth in subclauses (A) and (B) of this clause (2a)(2), each is received at the time of such sale or other disposition; provided, that the following shall be considered cash or Cash Equivalents:
amount of (i) the assumption by the purchaser of any Debt or other obligations or liabilities (that would appear as shown liabilities on the Company’s most recent a balance sheet or prepared in the footnotes thereto) accordance with GAAP (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the NotesDebt) of the Company or a any such applicable Restricted Subsidiary pursuant to operation of law that is actually assumed by the transferee in such Asset Sale (or a customary novation agreement,
third party on behalf of the transferee) and from which the Company or such applicable Restricted Subsidiaries are fully and unconditionally released, and (ii) Additional Assets,
(iii) instruments, notes, any securities or other obligations notes received by the Company or any such applicable Restricted Subsidiary from the purchaser that which are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents within 180 days of such Asset Sale (to the extent of the cash or Cash Equivalents actually so received), will be deemed to be cash for purposes of this clause (a)(2) and to have been received at the time of such sale; and
(ivb) any Designated Non-Cash Consideration The Asset Sale Proceeds received by the Company or such Restricted Subsidiary Subsidiary, as the case may be, may be applied, at the option of the Company or such Restricted Subsidiary:
(1) if the assets subject of such Asset Sale constitute Notes Priority Lien Collateral, (i) first, to prepay, repay or purchase (or offer to prepay, repay or purchase, as applicable) any Priority Lien Obligations on a pro rata basis; and (ii) second, to prepay, repay or purchase (or offer to prepay, repay or purchase, as applicable) any Subordinated Lien Obligations on a pro rata basis; provided, that any repayment, prepayment or purchase of (or offer to prepay, repay or purchase) obligations under the PIK Toggle Notes shall be made as provided under Section 4.01, through open-market purchases (to the extent such purchases are at or above 100% of the principal amount thereof plus accrued unpaid interest) or by making an offer (in accordance with the procedures set forth below for an Excess Proceeds Offer) to all Holders of PIK Toggle Notes to purchase their PIK Toggle Notes at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, on the amount of PIK Toggle Notes that would otherwise be purchased;
(2) if the assets subject of such Asset Sale do not constitute Notes Priority Lien Collateral, to prepay, repay or purchase (or offer to prepay, repay or purchase, as applicable) indebtedness under any Credit Facilities or any other secured Debt of the Company (including the PIK Toggle Notes) or any Restricted Subsidiary; provided, that any repayment, prepayment or purchase of (or offer to prepay, repay or purchase) obligations under the PIK Toggle Notes shall be made as provided under Section 4.01, through open-market purchases (to the extent such purchases are at or above 100% of the principal amount thereof plus accrued unpaid interest) or by making an offer (in accordance with the procedures set forth below for an Excess Proceeds Offer) to all Holders of PIK Toggle Notes to purchase their PIK Toggle Notes at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, on the amount of PIK Toggle Notes that would otherwise be purchased; or
(3) to make capital expenditures or to make an investment in properties and assets that are used or useful in the business of the Company or its Restricted Subsidiaries or in businesses reasonably similar to or ancillary to the business of the Company or its Restricted Subsidiaries as conducted at the time of such Asset Sale (including the acquisition of Capital Stock of any such business or businesses); provided, that (i) the Consolidated Secured Leverage Ratio calculated as of the last day of the most recently ended quarter prior to the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant for which financial statements are required to this clause be delivered does not exceed 2.5 to 1.0; and (dii) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and such investment occurs, or (y) $30.0 million the Company or any such Restricted Subsidiary enters into contractual commitments to so apply such Asset Sale Proceeds, subject only to customary conditions other than the obtaining of financing, in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 case, within 365 days after following the receipt of any Net Cash such Asset Sale Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the any commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (iiy) or (iii) above shall be treated as a permitted application of above, the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is transactions contemplated thereby are consummated within 180 days of the end date such commitment is entered into); provided, further, to the extent Asset Sale Proceeds of Collateral are used to acquire additional assets, such additional assets (other than, for avoidance of doubt, Excluded Assets) are pledged subject to the Intercreditor Agreement and the Collateral Trust Agreement, as Collateral for the benefit of the 360-day period referred Collateral Trustee, the Trustee and the Holders of PIK Toggle Notes. Pending any such reinvestment (x) Asset Sale Proceeds of Notes Priority Lien Collateral shall, as promptly as practicable, subject to the Intercreditor Agreement, be deposited in a Noteholder Proceeds Collateral Account pledged as Notes Priority Lien Collateral for the first sentence benefit of this paragraph the Priority Lien Obligations, Subordinated Lien Obligations and ABL Debt Obligations in accordance with the Intercreditor Agreement and the Collateral Trust Agreement, and (y) if such acquisition is not consummated within Asset Sale Proceeds of ABL Priority Lien Collateral shall, as promptly as practicable, subject to the period set forth Intercreditor Agreement, be deposited in clause (x) a deposit account or such binding commitment is terminatedsecurities account pledged as ABL Priority Lien Collateral for the benefit of the ABL Debt Obligations, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof Priority Lien Obligations and Subordinated Lien Obligations in accordance with this Section 4.09, the Company or Intercreditor Agreement and the Collateral Trust Agreement. If on the 45th day following any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to or the end of 365th day if the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, Consolidated Secured Leverage Ratio calculated in accordance with Section 3.0210.09(b)(3)(i) does not exceed 2.5 to 1.0), Notes having a principal the Available Asset Sale Proceeds exceed $7,500,000, the Company will apply an amount equal to:
to such Available Asset Sale Proceeds to an offer to repurchase (i) accumulated Excess Proceeds, multiplied by
the PIK Toggle Notes and (ii) at its option, other Secured Debt, in each case at a fraction (x) the numerator of which is purchase price in cash equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount of the PIK Toggle Notes and such other Secured Debt, plus accrued interest toand unpaid interest, but excluding if any, to the purchase date of purchase. If (an “Excess Proceeds Offer”); provided, that if the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are PIK Toggle Notes (and other Secured Debt, if applicable) tendered and not withdrawn pursuant to the offerExcess Proceeds Offer exceeds the Available Asset Sale Proceeds, the Issuers Company shall purchase Notes having an aggregate principal amount equal to first repurchase the purchase amount on a pro rata basis to tendered Priority Lien Debt before any Subordinated Lien Debt is repurchased. The Company may satisfy the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof foregoing obligations with respect to a PIK Note or any such Available Asset Sale Proceeds by making an Excess Proceeds Offer with respect to such Available Asset Sale Proceeds prior to the portion of a Global Note constituting PIK Interest). Upon completion expiration of the Offer relevant 45-day period (or such longer period provided above) or with respect to Purchase, Available Asset Sale Proceeds of less than $7,500,000. If an Excess Proceeds will be reset at zeroOffer is not fully subscribed, the Company may retain and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used use for general corporate purposes or any purpose not otherwise prohibited by this IndentureIndenture the portion of the Available Asset Sale Proceeds not required to repurchase PIK Toggle Notes (or other Secured Debt, if applicable). Upon completion of any Excess Proceeds Offer, the amount of Available Asset Sale Proceeds shall be reset to zero.
(c) If the Company is required to make an Excess Proceeds Offer, the Company shall mail, within 30 days of the 45th day following the receipt of Available Asset Sale Proceeds (or the 365th day if the Consolidated Secured Leverage Ratio calculated in accordance with Section 10.09(b)(3)(i) does not exceed 2.5 to 1.0) exceeding $7,500,000 as specified in Section 10.09(b), a notice to the Holders, at the address appearing in the Register maintained by the Registrar, with a copy to the Trustee, stating the information set forth below. The Issuers notice, which shall govern the terms of the Excess Proceeds Offer, shall state:
(1) that the Company is offering to apply the Available Asset Sale Proceeds to repurchase PIK Toggle Notes at a purchase price in cash equal to 100% of the principal amount of the PIK Toggle Notes, plus accrued and unpaid interest, if any, to the purchase date;
(2) the purchase date (which shall be no earlier than 30 days nor later than 60 days from the date such notice is mailed);
(3) the instructions that each Holder must follow in order to have PIK Toggle Notes purchased, which shall be reasonable and customary for transactions of this nature; and
(4) the calculations used in determining the amount of Available Asset Sale Proceeds to be applied to the purchase of PIK Toggle Notes. The Company shall comply with the requirements of 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 connection with the purchase repurchase of the PIK Toggle Notes pursuant to in connection with an Offer to Purchase pursuant to this Section 4.09Excess Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with this Section 4.09 or Section 3.0210.09, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed not to have breached their its obligations under this Section 4.09 or Section 3.02 10.09 by virtue of such conflictcompliance.
Appears in 1 contract
Sources: First Supplemental Indenture (Catalyst Paper General Partnership)
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make consummate an Asset Sale unless:
(i) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s senior management or, in the case of an Asset Sale in excess of $50.0 million, the Board of Directors of the Company);
(ii) with respect to any Asset Sale unless the following conditions are met:
(a) the Asset Sale is for at least Fair Market Value; and
(b) in excess of $50.0 million, at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists of Subsidiary, as the case may be, from such Asset Sale shall be in the form of:
(a) cash or Cash Equivalents; provided that for purposes of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(iib) Additional Assets,
(iii) instruments, notes, securities or other obligations received properties and assets to be owned by the Company or such any of its Restricted Subsidiary from the purchaser Subsidiaries and used in a Permitted Business,
(c) Capital Stock in one or more Persons engaged in a Permitted Business that are promptly, but in any event within 90 days or thereby become Restricted Subsidiaries of the closingCompany, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, andor
(ivd) any Designated Non-Cash Noncash Consideration received by the Company or such Restricted Subsidiary in the respect of such Asset Sale having an aggregate Fair Market Valuefair market value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this clause subclause (d) that is at that time outstanding, not to exceed in excess of the greater of (x) $10.0 340.0 million per fiscal year and (y) $30.0 million in 35.0% of Consolidated EBITDA of the aggregate since Company for the Issue Date (most recently ended Four Quarter Period at the time of the receipt of such Designated Noncash Consideration, with the Fair Market Value fair market value of each item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value);, and, in each case, such consideration is received at the time of such disposition; provided that the amount of
(c1) Within 360 any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet) of the Company or such Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Securities) that are assumed by the transferee of any such assets, and
(2) any securities received by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents within 90 days after such Asset Sale (to the receipt extent of any Net the cash or Cash Proceeds from an Equivalents actually so converted), shall be deemed to be cash for the purposes of this provision only; and
(iii) upon the consummation of such Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds may be used:
relating to such Asset Sale within 450 days (or, if later, 180 days after the date the Company or a Restricted Subsidiary has entered into a binding commitment to reinvest the proceeds of any such Asset Sale prior to the expiration of such 450 day period) of receipt thereof to (A) make an Investment (i) in properties and assets that replace the properties and assets that were the subject of such Asset Sale or (ii) in properties and assets that will be used by the Issuer or a Restricted Subsidiary in a Permitted Business (clauses (i) and (ii) collectively referred to permanently as “Replacement Assets”), (B) repay (A) Debt outstanding Indebtedness of the Issuer and the Restricted Subsidiaries under the any Credit Agreement (and, in to the case extent such Indebtedness under any Credit Agreement is comprised of the repayment of the a revolving credit facility under the Credit Agreementor arrangement, simultaneously effect a permanent reduction of commitments thereunder in an amount equal to permanently reduce the commitment thereunder by such amountrepayment) or (C) a combination of (A) and (B) of this clause (iii). On the Notes and 451st day (or, if later, the 181st day after the date the Company or a Restricted Subsidiary has entered into a binding commitment to reinvest the proceeds of any Debt secured by Liens ranking pari passu with the Liens securing the Notes (such Asset Sale prior to such 451st day) after such Asset Sale or such earlier date, if any) through making , as the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business Board of Directors of the Company or one or more of such Restricted Subsidiaries; provided that a binding commitment Subsidiary determines not to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of apply the Net Cash Proceeds from the date of relating to such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period Asset Sale as set forth in clause (xiii) or of the immediately preceding paragraph (each, a “Net Proceeds Offer Trigger Date”), such binding commitment is terminated, the aggregate amount of Net Cash Proceeds which have not so been applied will on or before such Net Proceeds Offer Trigger Date (each a “Net Proceeds Offer Amount”) shall be deemed applied by the Company or such Restricted Subsidiary to make an offer to purchase from the Holders of the Securities, and, if required by the terms of any Other Pari Passu Obligations, from the holders of such Other Pari Passu Obligations (the “Net Proceeds Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, on a pro rata basis, an amount of Securities and Other Pari Passu Obligations equal to the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Securities and Other Pari Passu Obligations to be Excess Proceeds (as defined below)purchased, plus accrued and unpaid interest thereon, if any, to but not including the date of purchase. For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, If at any time any non-cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with such Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.18. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $50.0 million (the “Net Proceeds Trigger”) resulting from an one or more Asset Sale for general corporate purposes Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $50.0 million, shall be applied as required pursuant to the end of the 360-day period referred to in the first sentence second preceding paragraph of this Section 4.09(c4.18).. Notice of each Net Proceeds Offer pursuant to this Section 4.18 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and materials necessary to enable such Holders to tender Securities pursuant to the Net Proceeds Offer and shall state the following terms:
(d1) When that Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to proration as hereinafter described in the event the Net Proceeds Offer is oversubscribed) in denominations of $2,000 or in integral multiples of $1,000 of principal amount, at the applicable purchase price;
(2) that the Net Proceeds Offer is being made pursuant to this Section 4.18 and that all Securities tendered will be accepted for payment; provided, however, that if the principal amount of Securities or Other Pari Passu Obligations tendered in the Net Proceeds Offer exceeds the aggregate amount of the Net Cash Proceeds Offer Amount, the Company shall select the Securities or Other Pari Passu Obligations to be purchased on a pro rata basis (based on amounts tendered);
(3) the purchase price (including the amount of accrued interest, if any) and the Net Proceeds Offer Payment Date (which shall be no earlier than 30 days nor later than 60 days from Asset Sales the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(4) that any Security not applied tendered will continue to accrue interest;
(5) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(and within 6) that Holders electing to have a Security purchased pursuant to the time frame set Net Proceeds Offer will be required to surrender the Security, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day prior to the Net Proceeds Offer Payment Date;
(7) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)the name of the Holder, the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes Security, the Holder delivered for purchase and a statement that such Hol▇▇▇ ▇▇ withdrawing his election to have such Security purchased; and
(y) the denominator of which is 8) that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers’ Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon, set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so to the Holder thereof. For purposes of this Section 4.18, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that only Notes in multiples of $1,000 principal amount (and in a minimum the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 the Securities and any integral multiple of $1.00 in excess thereof with respect Other Pari Passu Obligations tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.18, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.18 by virtue thereof. The provisions of such conflictthis Section 4.18 and other provisions contained in this Indenture relating to the Company’s obligation to make a Net Proceeds Offer may be waived or modified with the written consent of the Holders of a majority in principal amount of the Securities.
Appears in 1 contract
Sources: Indenture (Clean Harbors Inc)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any Restricted Subsidiary to, make any Asset Sale unless (i) the following conditions are met:
Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the Fair Market Value (aas evidenced by a resolution of the Board of Directors set forth in an Officers' Certificate delivered to the Trustee) of the assets or other property sold or disposed of in the Asset Sale is for at least Fair Market Value; and
and (bii) at least 75% of the such consideration received by the Company or its Restricted Subsidiaries consists of either cash or Cash Equivalents; provided provided, however, that for purposes of this clause Section 4.16, "cash" shall include (2), each x) the amount of any Indebtedness (other than any Indebtedness that is by its terms subordinated to the Notes and/or the Guarantees) of the following shall be considered cash Company or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities (such Restricted Subsidiary as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt notes thereto that is assumed by the transferee of any such assets or other obligations property in such Asset Sale (and excluding any liabilities that are incurred in connection with or liabilities subordinated in right anticipation of payment such Asset Sale), but only to the Notes) of extent that such assumption is effected on a basis such that there is no further recourse to the Company or a any of the Restricted Subsidiary pursuant Subsidiaries with respect to operation of law or a customary novation agreement,
such liabilities and (iiy) Additional Assets,
(iii) instruments, any notes, obligations or securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event converted within 90 60 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received, and).
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(cb) Within 360 270 days after the receipt of any Net Cash Proceeds from an any Asset Sale, the Company may elect to apply the Net Cash Proceeds may from such Asset Sale to (a) permanently reduce any Senior Debt and/or (b) make an investment in, or acquire assets and properties that will be used:
(i) to permanently repay (A) Debt outstanding under used in, the Credit Agreement (and, in the case business of the repayment of Company, or a Restricted Subsidiary, existing on the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) Issue Date or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of Related Business. Pending the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted final application of the any such Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09Proceeds, the Company or any Restricted Subsidiary may use any temporarily reduce Indebtedness of the Company under the Credit Facility or temporarily invest such Net Proceeds in cash or Cash Equivalents. Any Net Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to not applied or invested as provided in the first sentence of this Section 4.09(c)paragraph within 270 days of such Asset Sale will be deemed to constitute "Excess Proceeds."
(dc) When Each date that the aggregate amount of Net Cash Excess Proceeds from in respect of which an Asset Sales Sale Offer (as defined below) has not applied been made exceeds $5.0 million shall be deemed an "Asset Sale Offer Trigger Date." As soon as practicable, but in no event later than 20 Business Days after each Asset Sale Offer Trigger Date, the Company shall commence an offer (an "Asset Sale Offer") to purchase the maximum principal amount of Notes that may be purchased out of the Excess Proceeds. Any Notes to be purchased pursuant to (and within an Asset Sale Offer shall be purchased pro rata based on the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes outstanding, and (y) the denominator of which is all Notes shall be purchased at an offer price in cash in an amount equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof, plus accrued interest toand unpaid interest, but excluding if any, to the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to To the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remain after completion of an Asset Sale Offer, the Company may use the remaining after consummation of the Offer to Purchase may be used amount for any purpose not general corporate purposes otherwise prohibited permitted by this Indenture. The Issuers shall comply with In the requirements of Rule 14e-1 event that the Company is prohibited under the Exchange Act and terms of any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase agreement governing outstanding Senior Debt of the Company from repurchasing Notes with Excess Proceeds pursuant to an Asset Sale Offer as set forth in the first sentence of this paragraph, the Company shall promptly use all Excess Proceeds to Purchase pursuant to this Section 4.09reduce permanently such outstanding Senior Debt of the Company. To Upon the extent that the provisions consummation of any securities laws or regulations conflict with Section 4.09 or Section 3.02Asset Sale Offer, the Issuers amount of Excess Proceeds shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflictbe reset to zero.
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall not, and shall not cause or permit any Restricted Subsidiary to, directly or indirectly, consummate an Asset Sale (including the sale of any of the Capital Stock of any Restricted Subsidiary but excluding the sale of any interests in Unrestricted Subsidiaries) providing for Net Proceeds in excess of $1,000,000 unless the Net Proceeds from such Asset Sale are applied (in any manner otherwise permitted by this Indenture) to one or more of the following purposes in such combination as the Company or the applicable Restricted Subsidiary, as the case may be, shall elect: (i) an investment in another asset or business in the same line of business as, or a line of business similar, ancillary, complementary or reasonably related to that of, a line of business or businesses of the Company and its Restricted Subsidiaries at the time of the Asset Sale; provided that such investment occurs on or prior to the 270th day following the date of such Asset Sale (the "Asset ----- Sale Disposition Date"), (ii) the reimbursement of the Company or its Restricted --------------------- Subsidiaries for expenditures made, and costs incurred, to repair, rebuild, replace or restore property subject to loss, damage or taking to the extent that the Net Proceeds consist of insurance proceeds received on account of such loss, damage or taking, (iii) the purchase, redemption or other prepayment or repayment of outstanding Senior Indebtedness of the Company or its Restricted Subsidiaries on or prior to the 270th day following the Asset Sale Disposition Date and permanent reduction of the amount of such Indebtedness, or (iv) the cash collateralization of letters of credit or bankers acceptances designed to facilitate the purchase of goods and services provided that any cash collateral released to the Company or its Restricted Subsidiaries upon the expiration of such letters of credit, bankers acceptances or other instruments or arrangements shall again be deemed to be Net Proceeds received on the date of such release. The Company shall not, and shall not permit any Restricted Subsidiary to, make any directly or indirectly, consummate an Asset Sale unless the following conditions are met:
(a) the Asset Sale is for at least Fair Market Value; and
(b) at least 75% of the consideration thereof received by the Company or its such Restricted Subsidiaries consists Subsidiary is in the form of cash, cash equivalents or Cash EquivalentsMarketable Securities; provided that that, solely for purposes of this clause (2), each calculating such 75% of the following shall be considered cash or Cash Equivalents:
consideration, the amount of (ix) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes notes thereto) (other than Subordinated Debt or other obligations or , excluding contingent liabilities subordinated in right of payment to the Notesand trade payables) of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Securities) that are assumed by the transferee of law or a customary novation agreement,
any such assets and (iiy) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any no event within 90 more than 45 days of the closingafter receipt, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received), and
(iv) shall be deemed to be cash and cash equivalents for purposes of this provision. Any Net Proceeds from any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, are not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) applied or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; invested as provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be shall constitute "Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c)Proceeds." ---------------
(db) When the aggregate amount of Net Cash Excess Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(cnet of Foreign Proceeds, as defined below) exceeds $25.0 million 10,000,000 (“Excess Proceeds”such date being an "Asset Sale ---------- Trigger Date"), the Issuers must, within 30 days, Company shall make an offer Offer to purchase, in accordance with Section 3.02, Notes having purchase on a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) pro rata basis ------------ the numerator of which is equal to the outstanding aggregate maximum principal amount of the Notes Securities and (y) the denominator of which is equal to the outstanding aggregate principal amount pari passu Indebtedness of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required Company or any Restricted Subsidiary, if any, that requires, pursuant to its terms, such an offer, then outstanding that may be repaidpurchased out of Excess Proceeds (an "Asset Sale Offer"), redeemed or tendered for at an offer price in connection with the Asset Sale, rounded down cash in an amount equal ---------------- to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof plus any accrued and unpaid interest toto the date the Securities tendered are purchased and paid for in accordance with this Section 4.05 (the "Asset Sale Purchase Date"). Notwithstanding the ------------------------ foregoing, to the extent that any or all of the Net Proceeds of an Asset Sale is prohibited or delayed by applicable local law from being repatriated to the United States or such repatriation would be expected to result in material tax liability to the Company or any Restricted Subsidiary, as determined in good faith by the Board of Directors (such Net Proceeds, the "Foreign Proceeds"), the ---------------- Company shall not be required to make an Asset Sale Offer with respect to such proceeds. Foreign Proceeds shall be applied, in such combination as the Company shall select, in accordance with clause (i), (ii), (iii) or (iv) of paragraph (a) of this Section 4.05, or, at the option of the Company, may be retained as cash or Marketable Securities for so long, but excluding only for so long, as the applicable local law prohibits or delays repatriation to the United States or would result in material tax liability as described above. Within 30 days following any Asset Sale Trigger Date, the Company shall mail a notice to each holder of Securities at such holder's registered address stating:
(i) that an Asset Sale Offer is being made pursuant to this Section 4.05, the length of time the Asset Sale Offer shall remain open and the maximum principal amount of Securities that will be accepted for payment pursuant to such Asset Sale Offer;
(ii) the purchase price, the amount of accrued and unpaid interest as of the Asset Sale Purchase Date and the Asset Sale Purchase Date (which shall be no earlier than 30 days and no later than 60 days from the date such notice is mailed);
(iii) that any Security or portion thereof not tendered or accepted for payment will continue to accrue interest;
(iv) that any Security or portion thereof accepted for payment pursuant to the Asset Sale Offer shall cease to accrue interest on and after the Asset Sale Purchase Date;
(v) that Holders electing to have a Security purchased pursuant to the Asset Sale Offer will be required to surrender the Security, with the form entitled "Option of purchase. If Holder to Elect Purchase" on the Offer reverse of the Security completed, to a Paying Agent at the address specified in the notice at least three Business Days before the Asset Sale Purchase 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 third Business Day before the Asset Sale Purchase Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Security the Holder delivered for purchase and a statement that such Holder is for withdrawing his election to have the Security purchased;
(vii) that, if the aggregate principal amount of Securities surrendered by Holders exceeds the Excess Proceeds, the Trustee shall select the Securities to be purchased on a pro rata basis, by lot or by any other method that the Trustee considers fair and appropriate and, if the Securities are listed on any securities exchange, by a method that complies with the requirements of such exchange; provided that, if less than all of the outstanding Notes and Notes a holder's Securities are to be redeemed or accepted for payment, only principal amounts of $1,000 or integral multiples thereof may be selected for redemption or accepted for payment;
(viii) that Holders whose Securities were purchased only in an aggregate part will be issued new Securities equal in principal amount in excess to the unpurchased portion of the purchase Securities surrendered; and
(ix) a brief description of the circumstances and relevant facts regarding such Asset Sale. On the Asset Sale Purchase Date, the Company shall, to the extent required by this Indenture and the Asset Sale Offer, (1) accept for payment the maximum principal amount are of Securities or portions thereof tendered and not withdrawn pursuant to the offerAsset Sale Offer that can be purchased out of Excess Proceeds, (2) deposit with the Issuers Paying Agent the aggregate purchase price of all Securities or portions thereof accepted for payment and any accrued and unpaid interest on such Securities as of the Asset Sale Purchase Date, and (3) deliver or cause to be delivered to the Trustee all Securities tendered pursuant to the Asset Sale Offer. The Paying Agent shall purchase Notes having promptly mail to each holder of Securities or portions thereof accepted for payment an aggregate principal amount equal to the purchase price for such Securities plus any accrued and unpaid interest thereon, and the Trustee shall promptly authenticate and mail (or cause to be transferred by book-entry) to such holder of Securities accepted for payment in part a new Security equal in principal amount on a pro rata basis to any unpurchased portion of the Securities and any Security not accepted for payment in whole or in part shall be promptly returned to the extent practicable, with adjustments by Holder thereof. The Company will publicly announce the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion results of the Asset Sale Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining on or as soon as practicable after consummation of the Offer to Asset Sale Purchase may be used for any purpose not otherwise prohibited by this IndentureDate. The Issuers Company shall comply with the requirements of Rule 14e-1 any tender offer rules under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable which may then be applicable, including Rule 14e-1, in connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02provisions of this Indenture, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 Indenture by virtue thereof.
(c) To the extent that any Excess Proceeds (other than Foreign Proceeds) remain after completion of an Asset Sale Offer, the Company may use such conflictremaining amount for general corporate purposes including repayment of Subordinated Indebtedness. Upon completion of an Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero plus the amount, if any, of cash or Marketable Securities attributable to Foreign Proceeds.
Appears in 1 contract
Sources: Indenture (Carson Products Co)
Limitation on Asset Sales. (i) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s senior management or, in the case of an Asset Sale in excess of $5.0 million, the Board of Directors of the Company);
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of (x) cash or Cash Equivalents, (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business or (z) Capital Stock in one or more Persons engaged in a Permitted Business that are or thereby become Restricted Subsidiaries of the Company, and, in each case, such consideration is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Securities) that are assumed by the transferee of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations securities received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 180 days after such Asset Sale (to the extent of the cash or Cash Equivalents actually so received, received in the conversion) shall be deemed to be cash for the purposes of this provision only; and
(iviii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either:
(A) to prepay any Designated Non-Senior Debt or Guarantor Senior Debt or any Indebtedness of a Restricted Subsidiary that is not a Guarantor and, in the case of any Senior Debt or Guarantor Senior Debt or Indebtedness of a Restricted Subsidiary that is not a Guarantor under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility (or effect a permanent reduction in the availability under such revolving credit facility regardless of the fact that no prepayment is required);
(B) to make an investment (x) in properties and assets that replace the properties and assets that were the subject of such Asset Sale, (y) in properties and assets that will be used by the Company or a Restricted Subsidiary in a Permitted Business or (z) permitted by clause (1) of the definition of Permitted Investments (collectively, “Replacement Assets”); or
(C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Pending the final application of the Net Cash Consideration received Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Indebtedness or otherwise invest such Net Cash Proceeds in any manner not prohibited by this Indenture. On the 361st day after an Asset Sale or such earlier date, if any, as the senior management or the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary in to make an offer to purchase (the Asset Sale having an aggregate Fair Market Value“Net Proceeds Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, taken together with from all other Designated Non-Cash Consideration received pursuant Holders on a pro rata basis, that amount of Securities equal to this clause (d) the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Securities to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, that if the Company so elects or is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in required by the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt terms of any Senior Subordinated Debt, such Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds Offer may be used:
(i) made ratably to permanently repay (A) Debt outstanding under purchase the Credit Agreement (and, in the case Securities and such other Indebtedness of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking Company that ranks pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360Securities. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.17. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from an one or more Asset Sale for general corporate purposes Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $10.0 million, shall be applied as required pursuant to the end second preceding paragraph). In the event of the 360-day period referred transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01, which transaction does not constitute a Change of Control, the first sentence successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section, and shall comply with the provisions of clause (iii) of this Section 4.09(c).
(d) When 4.17 with respect to such deemed sale as if it were an Asset Sale. In addition, the aggregate amount fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from Asset Sales not applied for purposes of this Section 4.17. Notice of each Net Proceeds Offer pursuant to (this Section 4.17 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and within materials necessary to enable such Holders to tender Securities pursuant to the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), Net Proceeds Offer and shall state the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal tofollowing terms:
(i) accumulated Excess Proceedsthat Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to prorationing as hereinafter described in the event the Net Proceeds Offer is oversubscribed) in integral multiples of $1,000 of principal amount ($1.00 in the case of PIK Notes), multiplied byat the applicable purchase price;
(ii) that the Net Proceeds Offer is being made pursuant to this Section 4.17 and that all Securities tendered will be accepted for payment; provided, however, that if the principal amount of Securities tendered in the Net Proceeds Offer exceeds the aggregate amount of the Net Proceeds Offer Amount, the Company shall select the Securities to be purchased on a fraction pro rata basis (xbased on amounts tendered);
(iii) the numerator purchase price (including the amount of accrued interest, if any) and the purchase date (which is equal shall be no earlier than 30 days nor later than 60 days from the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(iv) that any Security not tendered will continue to accrue interest;
(v) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the outstanding aggregate Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(vi) that Holders electing to have a Security purchased pursuant to the Net Proceeds Offer will be required to surrender the Security, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Offer Payment Date;
(vii) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes Security the Holder delivered for purchase and a statement that such ▇▇▇▇▇▇ is withdrawing his election to have such Security purchased; and
(yviii) the denominator of which is that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers’ Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so to the Holder thereof. For purposes of this Section 4.17, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that only Notes in multiples of $1,000 principal amount (and in a minimum the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect the Securities tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.17, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.17 by virtue thereof. The provisions of such conflictthis Section 4.17 and other provisions contained in this Indenture relating to the Company’s obligation to make a Net Proceeds Offer may be waived or modified with the written consent of the Holders of a majority in principal amount of the Securities.
Appears in 1 contract
Sources: Indenture (Quality Distribution Inc)
Limitation on Asset Sales. The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any summate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least equal to the Fair Market Value; andValue of the assets sold or otherwise disposed of;
(b2) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or cash, Cash EquivalentsEquivalents and/or Replacement Assets (as defined below) and is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet sheet) of the Company or in the footnotes thereto) any such Restricted Subsidiary (other than Subordinated Debt or other obligations or liabilities that are by their terms subordinated in right of payment to the NotesNotes or any Guarantee of a Guarantor) that are assumed by the transferee of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, immediately converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received), shall be deemed to be cash for the purposes of this provision; and
(iv3) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 270 days of receipt thereof either;
(a) to (x) repay and permanently reduce the availability of credit under the Credit Agreement or (y) repay and elect to reduce the amount of outstanding Indebtedness permitted to be incurred pursuant to clauses (11) and/or (16) of the definition of Permitted Indebtedness;
(b) to make an investment in properties and assets that replace the properties and assets that were the subject of such Asset Sale or in properties and assets that will be used in the same or a similar line of business as the Company or the Restricted Subsidiary, as the case may be, as existing on the date of this In denture or in businesses reasonably related thereto (“Replacement Assets”); provided that the Net Cash Proceeds from an Asset Sale relating to the Company’s tobacco business are used to make an investment in Replacement Assets relating to the tobacco business; provided further that the Net Cash Proceeds of an Asset Sale relating to assets owned directly by the Company or a Guarantor are used to make an investment in Replacement Assets owned directly by the Company or a Guarantor;
(c) to permanently reduce any Designated Non-outstanding Indebtedness of such Restricted Subsidiary to the extent such Restricted Subsidiary is not a Guarantor (and to correspondingly reduce the commitments, if any, with respect thereto); or
(d) a combination of repayment and investment permitted by the foregoing clauses (3)(a), (3)(b) and (3)(c). On the 271st day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Consideration received Proceeds relating to such Asset Sale as set forth in clauses (3)(a), (3)(b), (3)(c) and (3)(d) of the preceding paragraph (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (3)(a), (3)(b), (3)(c) and (3)(d) of the preceding paragraph (each, a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred offer to in clause purchase (iithe “Net Proceeds Offer”) or on a date (iiithe “Net Proceeds Offer Payment Date”) above shall be treated as not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, from all Holders on a permitted application pro rata basis, that amount of Notes equal to the Net Proceeds Offer Amount at a price equal to 100% of the Net Cash Proceeds from principal amount of the Notes to be purchased, plus accrued and unpaid interest thereon, if any, to the date of such commitmentpurchase; provided provided, however, that (x) such investment is consummated within 180 days of the end of the 360if at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or dissolution shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not thereof shall be applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with this Section 3.024.15. The Company or such Restricted Subsidiary, Notes having a principal amount equal to:
(i) accumulated Excess Proceedsas the case may be, multiplied by
(ii) a fraction (x) may defer the numerator of which Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from one or more Asset Sales (at which time, the outstanding aggregate principal amount of entire unutilized Net Proceeds Offer Amount, and not just the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn $10.0 million shall be applied as required pursuant to this paragraph). Notwithstanding the offerforegoing, the Issuers restriction contained in clause (2) of the first paragraph of this Section 4.15 shall purchase Notes having an aggregate principal amount equal not apply with respect to any sale, in whole or in part, of assets or Capital Stock of Standard Wool, Inc. In connection with each Net Proceeds Offer, the Company shall send, by first class mail, a notice to each Holder, with a copy to the purchase Trustee, notice of such, within 25 days following the Net Proceeds Offer Trigger Date, and shall comply with the procedures set forth in this Indenture. Upon receiving notice of the Net Proceeds Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1,000 in exchange for cash. To the extent Holders properly tender Notes in an amount exceeding the Net Proceeds Offer Amount, Notes of tendering Holders shall be purchased on a pro rata basis to the extent practicable, with adjustments (based on amounts tendered). A Net Proceeds Offer shall remain open for a period of 20 business days or such longer period as may be required by the law. The Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds such Restricted Subsidiaries will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of Rule 14e-1 under the Exchange Act and the regulations thereunder and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflicta Net Proceeds Offer.
Appears in 1 contract
Sources: Indenture (Standard Commercial Corp)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any Restricted Subsidiary to, make engage in any Asset Sale unless the following conditions are met:
(ai) the Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least equal to the Fair Market Value; and
Value of the Properties sold or otherwise disposed of pursuant to the Asset Sale, (bii) at least 75% of the consideration received by the Company or the Restricted Subsidiary, as the case may be, in respect of such Asset Sale consists of cash, Cash Equivalents or properties used in the Oil and Gas Business of the Company or its Restricted Subsidiaries consists of cash or Cash Equivalents; provided and (iii) the Company delivers to the Trustee an Officers' Certificate certifying that for purposes of this clause (2), each of the following shall be considered cash or Cash Equivalents:
such Asset Sale complies with clauses (i) the assumption by the purchaser and (ii) of Debt or other obligations or liabilities this Section 10.17(a). The amount (as shown on the Company’s most recent balance sheet or in the footnotes theretowithout duplication) of any Indebtedness (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the NotesIndebtedness) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from that is expressly assumed by the purchaser that are promptlytransferee in such Asset Sale and with respect to which the Company or such Restricted Subsidiary, but in any event within 90 days as the case may be, is unconditionally released by the holder of such Indebtedness, shall be deemed to be cash or Cash Equivalents for purposes of clause (ii) and shall also be deemed to constitute a repayment of, and a permanent reduction in, the amount of such Indebtedness for purposes of the closingfollowing paragraph.
(b) If the Company or any Restricted Subsidiary engages in an Asset Sale, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalentsmay either, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within no later than 360 days after the receipt of any Net Cash Proceeds from an such Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) apply all or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Available Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred therefrom to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes repay Senior Indebtedness (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.Senior
Appears in 1 contract
Limitation on Asset Sales. The Company shall will not, and shall will, not permit any Restricted Subsidiary to, make any Asset Sale unless the following conditions are met:
(ai) the Asset Sale is for Company or the Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least equal to the Fair Market Value; and
Value of the assets sold or disposed of as determined by the good-faith judgment of the Board of Directors, which determination, in each case where such fair market value is greater than $5.0 million, shall be evidenced by a Board Resolution and (bii) at least 75% of the consideration received by the Company for such sale or its Restricted Subsidiaries other disposition consists of cash or Cash Equivalents; provided that for purposes of this clause (2), each of the following shall be considered cash equivalents or Cash Equivalents:
(i) the assumption by of unsubordinated Indebtedness. The Company shall, or shall cause the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a relevant Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instrumentsto, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the date of receipt of any the Net Cash Proceeds from an Asset Sale, the (i) (A) apply an amount equal to such Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under unsubordinated Indebtedness of the Credit Agreement (andCompany or Indebtedness of any Restricted Subsidiary, in each case owing to a Person other than the case Company or any of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) its Restricted Subsidiaries or (B) invest an equal amount, or the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes amount not so applied pursuant to clause (if anyA) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in long-term property or assets of a nature or type or that are used in a Permitted Business business (or in a company having property and assets of a nature or type, or engaged in a business) similar or related to the nature or type of the property and assets of, or the business of, the Company or one or more and its Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from Subsidiaries existing on the date of such commitment; provided that investment (xas determined in good faith by the Board of Directors, whose determination shall be conclusive and evidenced by a Board Resolution) such investment is consummated within 180 days of and (ii) apply (no later than the end of the 360-day period referred to above) such excess Net Cash Proceeds (to the extent not applied pursuant to clause (i)) as provided in the first sentence following paragraphs of this paragraph and Section 1017. The amount of such Net Cash Proceeds required to be applied (yor to be committed to be applied) if during such acquisition is not consummated within 360-day period in the period manner as set forth in clause (xi) or of the preceding sentence and not applied as so required by the end of such binding commitment is terminatedperiod shall constitute "Excess Proceeds." If, as of the first day of any calendar month, the Net Cash aggregate amount of Excess Proceeds not so applied will be deemed theretofore subject to be an Excess Proceeds Offer (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09) totals at least $10.0 million, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 daysnot later than the 30th Business Day thereafter, make an offer (an "Excess Proceeds Offer") to purchase, in accordance with Section 3.02, Notes having purchase from the Holders on a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding pro rata basis an aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount Proportionate Share of the Notes and all Debt secured by Liens Excess Proceeds on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaidsuch date, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The at a purchase price for the Notes will be equal to 100% of the principal amount plus of the Notes, plus, in each case, accrued and unpaid interest to, but excluding to the date of purchasepurchase (the "Excess Proceeds Payment"). If The Company shall 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 Purchase this Section 1017 and that all Notes validly tendered will be accepted for payment on a pro rata basis;
(ii) the purchase price and the date of purchase (which shall be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is for less than all mailed) (the "Excess Proceeds Payment Date");
(iii) that any Note not tendered will continue to accrue interest pursuant to its terms;
(iv) that, unless the Company defaults in the payment of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn Excess Proceeds Payment, any Note accepted for payment pursuant to the offerExcess Proceeds Offer shall cease to accrue interest on and after the Excess Proceeds Payment Date;
(v) that Holders electing to have a Note purchased pursuant to the Excess Proceeds Offer will be required to surrender the Note, together with the form entitled "Option of the Holder to Elect Purchase" on the reverse side of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Business Day immediately preceding the Excess Proceeds Payment 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 third Business Day immediately preceding the Excess Proceeds Payment Date, a telegram, facsimile transmission or letter setting forth the name of such Holder, the Issuers principal amount of Notes delivered for purchase and a statement that such Holder is withdrawing his election to have such Notes purchased; and
(vii) that Holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered; provided that each Note purchased and each new Note -------- issued shall be in a principal amount of $1,000 or integral multiples thereof. On the Excess Proceeds Payment Date, the Company shall
(i) accept for payment on a pro rata basis Notes or portions thereof tendered pursuant to the Excess Proceeds Offer up to the Proportionate Share of such Excess Proceeds;
(ii) deposit with the Paying Agent money sufficient to pay the purchase price of all Notes having or portions thereof so accepted; and
(iii) deliver, or cause to be delivered, to the Trustee all Notes or portions thereof so accepted together with an aggregate principal Officer's Certificate specifying the Notes or portions thereof accepted for payment by the Company. The Paying Agent shall promptly mail to the Holders of Notes so accepted payment in an amount equal to the purchase price, and the Trustee shall upon Company Order, promptly authenticate and mail to such Holders a new Note equal in principal amount on to any unpurchased portion of the Note surrendered; provided that each Note purchased and each new Note issued -------- shall be in a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples principal amount of $1,000 principal amount (and in a minimum amount of $1,000) or integral multiples thereof. The Company will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or publicly announce the portion of a Global Note constituting PIK Interest). Upon completion results of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Offer as soon as practicable after the Excess Proceeds remaining after consummation Payment Date. For purposes of this Section 1017, the Offer to Purchase may be used for any purpose not otherwise prohibited by this IndentureTrustee shall act as the Paying Agent. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable applicable, in connection the event that such Excess Proceeds are received by the Company under this Section 1017 and the Company is required to repurchase Notes as described above. SECTION 1018. Limitation on Issuances of Guarantees of Indebtedness ----------------------------------------------------- by Restricted Subsidiaries. -------------------------- The Company will not permit any Restricted Subsidiary, directly or indirectly, to guarantee, assume or in any other manner become liable with respect to any Indebtedness of the purchase Company, other than Indebtedness under Credit Facilities incurred under clauses (i) and (ii) of Section 1011, unless (i) such Restricted Subsidiary simultaneously executes and delivers a supplemental indenture to the Indenture providing for a Guarantee of the Notes pursuant on terms substantially similar to an Offer the guarantee of such Indebtedness, except that if such Indebtedness is by its express terms subordinated in right of payment to Purchase pursuant the Notes, any such assumption, Guarantee or other liability of such Restricted Subsidiary with respect to this Section 4.09. To such Indebtedness shall be subordinated in right of payment to such Restricted Subsidiary's assumption, Guarantee of other liability with respect to the Notes substantially to the same extent that as such Indebtedness is subordinated to the provisions Notes and (ii) such Restricted Subsidiary waives, and will not in any manner whatsoever claim or take the benefit or advantage of, any rights or reimbursement, indemnity or subrogation or any other rights against the Company or any other Restricted Subsidiary as a result of any securities laws payment by such Restricted Subsidiary under its Guarantee. Notwithstanding the foregoing, any Guarantee by a Restricted Subsidiary may provide by its terms that it will be automatically and unconditionally released and discharged upon (i) any sale, exchange or regulations conflict with Section 4.09 transfer, to any Person not an Affiliate of the Company, of all of the Company's and each Restricted Subsidiary's Capital Stock in, or Section 3.02all or substantially all of the assets of, such Restricted Subsidiary (which sale, exchange or transfer is not prohibited by the Issuers shall comply with Indenture) or (ii) the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 release or Section 3.02 by virtue discharge of the guarantee which resulted in the creation of such conflictGuarantee, except a discharge or release by or as a result of payment under such guarantee.
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s Board of Directors);
(b2) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash EquivalentsEquivalents and shall be received at the time of such disposition; provided that that, for purposes of this clause (2)) any securities, each of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents (to the extent of the cash or Cash Equivalents actually so received, ) within 30 days after receipt will be considered “cash” or “Cash Equivalents”; and
(iv3) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 365 days of receipt thereof either:
(a) to permanently reduce Indebtedness (x) under any Designated Non-Credit Facility and, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility or (y) of a Subsidiary that does not guarantee the Notes;
(b) to make an investment in properties and assets that replace the properties and assets that were the subject of such Asset Sale or in properties and assets (including Capital Stock) that will be used in the business of the Company and its Restricted Subsidiaries as existing on the Issue Date or in businesses reasonably related thereto (“Replacement Assets”); or
(c) a combination of prepayment and investment permitted by the foregoing clauses (3)(a) and (3)(b).
(b) On the 366th day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Consideration received Proceeds relating to such Asset Sale as set forth in clauses (3)(a), (3)(b) and (3)(c) of Section 4.10(a) (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds that have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (3)(a), (3)(b) and (3)(c) of Section 4.10(a) or the last proviso of this paragraph (each, a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary in to make an offer to purchase (the Asset Sale having an aggregate Fair Market Value“Net Proceeds Offer”) to all Holders and, taken together with to the extent required by the terms of any Pari Passu Indebtedness, to all other Designated Non-Cash Consideration received pursuant to this clause holders of such Pari Passu Indebtedness, on a date (dthe “Net Proceeds Offer Payment Date”) not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, from all Holders (and holders of any such Pari Passu Indebtedness) on a pro rata basis, the maximum amount of Notes and Pari Passu Indebtedness that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (may be purchased with the Fair Market Value of each item of Designated Non-Cash Consideration being measured Net Proceeds Offer Amount at the time received and without giving effect a price equal to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case 100% of the repayment principal amount of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (Pari Passu Indebtedness to be purchased, plus accrued and unpaid interest thereon, if any) through making the Offer , to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitmentpurchase; provided provided, however, that (x) such investment is consummated within 180 days of the end of the 360if at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.10. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $25.0 million resulting from one or more Asset Sales (at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in excess of $25.0 million, shall be applied as required pursuant to this Section 4.10(b)). In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01, which transaction does not constitute a Change of Control, the successor entity shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.10 and shall comply with the provisions of this Section 4.10 with respect to such deemed sale as if it were an Asset Sale. In addition, the fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this Section 4.10.
(c) Notwithstanding Sections 4.10(a) and (b), the Company and its Restricted Subsidiaries will be permitted to consummate an Asset Sale without complying with such Sections to the extent that:
(1) at least 75% of the consideration for general corporate purposes such Asset Sale constitutes Replacement Assets; and
(2) such Asset Sale is for fair market value; provided that any consideration not constituting Replacement Assets received by the Company or any of its Restricted Subsidiaries in connection with any Asset Sale permitted to be consummated under this Section 4.10(c) shall constitute Net Cash Proceeds subject to the provisions of Sections 4.10(a) and (b). Each Net Proceeds Offer will be mailed to the record Holders as shown on the register of Holders within 25 days following the Net Proceeds Offer Trigger Date, with a copy to the Trustee, and shall comply with the procedures set forth in this Supplemental Indenture. The notice to the Holders shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Net Proceeds Offer. Such notice shall state:
(1) that the Net Proceeds Offer is being made pursuant to this Section 4.10 and that (subject to the provisions hereof) all Notes tendered will be accepted for payment;
(2) the purchase price (including the amount of accrued interest) and the purchase date (which shall be the Net Proceeds Offer Payment Date);
(3) that any Note not tendered will continue to accrue interest if interest is then accruing;
(4) that, unless the Company defaults in making payment therefor, any Note accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(5) that Holders electing to have a reduction Note purchased pursuant to a Net Proceeds Offer will be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, to the Paying Agent at the address specified in borrowings under any revolving credit facility) the notice prior to the end close of business on the third business day prior to the Net Proceeds Offer Payment Date;
(6) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than 5:00 p.m., New York City time, on the second Business Day preceding the Net Proceeds Offer Date, a facsimile transmission or letter setting forth the name of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)Holder, the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased; and
(y7) the denominator of which is equal to the outstanding aggregate principal amount circumstances and relevant facts regarding such Net Proceeds Offer. Upon receiving notice of the Net Proceeds Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1,000 in exchange for cash. To the extent Holders properly tender Notes and all Debt secured by Liens on holders of Pari Passu Indebtedness properly tender such Pari Passu Indebtedness in an amount exceeding the Collateral ranking pari passu with Net Proceeds Offer Amount, the Liens on the Collateral securing the tendered Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes and Pari Passu Indebtedness will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount purchased on a pro rata basis (based on amounts tendered) in an aggregate amount equal to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount Net Proceeds Offer Amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interestany). Upon completion A Net Proceeds Offer shall remain open for a period of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase 20 Business Days or such longer period as may be used for any purpose not otherwise prohibited required by this Indenturelaw. The Issuers Company shall comply with the requirements of 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 connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with this Section 4.09 or Section 3.024.10, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.10 by virtue of such conflictthereof.
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any Asset Sale (including by operation of or as a result of an LLC Division) unless (i) the following conditions are met:
Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the fair market value (adetermined by the Company in good faith as of the date the Company enters into a definitive agreement relating to such Asset Sale) of the assets or other property sold or disposed of in the Asset Sale is for at least Fair Market Value; and
and (bii) except (x) in the case of a Permitted Asset Swap or (y) if such Asset Sale has a purchase price of less than $100.0 million, at least 75% of such consideration for such Asset Sale, together with all other Asset Sales since the consideration received by Escrow Release Date (on a cumulative basis), is in the Company or its Restricted Subsidiaries consists form of cash or Cash EquivalentsEquivalents or assets used or useful in the business of the Company; provided that for purposes of this clause Section 4.14 “cash” shall include (2), each A) the amount of any liabilities (other than liabilities that are by their terms subordinated to the Notes or any Subsidiary Guarantee) of the following shall be considered cash Company or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities such Restricted Subsidiary (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes notes thereto) that are assumed by the transferee in connection with such assets or other property in such Asset Sale (other than Subordinated Debt and excluding any liabilities that are incurred in connection with or in anticipation of such Asset Sale), but only to the extent that there is no further recourse to the Company or any of its Subsidiaries with respect to such liabilities; (B) any securities, notes or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations assets received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, or by their terms are required to be satisfied for cash or Cash Equivalents (to the extent of the cash or Cash Equivalents actually so received), and
in each case, within 180 days following the closing of such Asset Sale; and (ivC) any Designated Non-Cash Noncash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Valuefair market value that, when taken together with all other Designated Non-Cash Noncash Consideration previously received pursuant to this clause (d) that is at that time and then outstanding, does not to exceed the greater of (x) $10.0 120.0 million per fiscal year and (y) $30.0 million in 20.0% of L8QA Consolidated EBITDA at the aggregate since time of the Issue Date receipt of such Designated Noncash Consideration (with the Fair Market Value fair market value of each item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value);. Notwithstanding clause (ii) of this Section 4.14(a), (a) all or a portion of the consideration in connection with any such Asset Sale may consist of all or substantially all of the assets or a majority of the Voting Stock of an existing television or radio business, franchise or station or digital business (whether existing as a separate entity, subsidiary, division, unit or otherwise) or any other Similar Business and (b) the Company may, and may permit its Subsidiaries to, issue shares of Capital Stock in a Qualified Joint Venture to a Qualified Joint Venture Partner without regard to clause (ii) of this Section 4.14(a); provided that, in the case of any of (a) or (b) of this sentence after giving effect to any such Asset Sale and related acquisition of assets or Voting Stock, (x) no Default or Event of Default shall have occurred or be continuing; and (y) the Net Proceeds of any such Asset Sale, if any, are applied in accordance with this Section 4.14.
(cb) Within 360 450 days after the later of (A) the date of any Asset Sale and (B) the receipt of any Net Cash Proceeds of such Asset Sale (the “Asset Sale Proceeds Application Period”), the Company or such Restricted Subsidiary, at its option, may elect to apply or cause to be applied the Net Proceeds from an such Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay repay: (A) Debt outstanding Obligations under Secured Indebtedness (other than Indebtedness owed to the Credit Agreement (Company or a Restricted Subsidiary), and, in the case of the repayment revolving obligations (other than obligations in respect of the revolving any asset-based credit facility under the Credit Agreementfacility), to permanently correspondingly reduce the commitment thereunder by such amount) or commitments with respect thereto and/or (B) Obligations under any unsecured Indebtedness of the Notes and Company or any Debt secured by Liens ranking Restricted Subsidiary that ranks pari passu with the Liens securing in right of payment to the Notes (“Pari Passu Indebtedness”) and, in the case of revolving obligations (other than obligations in respect of any asset-based credit facility), to correspondingly reduce commitments with respect thereto; provided that in the case of any repayment pursuant to this clause (B), the Company or such Restricted Subsidiary will either (I) reduce Obligations under the Notes on a pro rata basis with such other ▇▇▇▇ ▇▇▇▇▇ Indebtedness by, at its option, (x) redeeming Notes pursuant to Section 3.01 or (y) purchasing Notes through open-market purchases or in privately negotiated transactions at market prices (which may be below par), or (II) make an offer (in accordance with the procedures set forth below for an Asset Sale Offer) to all Holders to purchase their Notes (which may be on a ratable basis with such other Pari Passu Indebtedness) for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased; provided that to the extent the Company or any Restricted Subsidiary makes an offer to redeem, prepay, repay or purchase any Obligations pursuant to the foregoing clause (i) through making at a price of no less than 100% of the Offer principal amount thereof, to Purchase below,the extent the relevant creditors do not accept such offering, the Company and the Restricted Subsidiaries will be deemed to have applied an amount of the Net Proceeds equal to such amount not so accepted in such offer, and such amount shall not increase the amount of Excess Proceeds (and such amount shall instead constitute Declined Proceeds);
(ii) to acquire invest in the business of the Company and its Subsidiaries, including any investment in Additional Assets; or;
(iii) to make capital expenditures in or that are used or useful in a Permitted Similar Business or to make capital expenditures for maintenance, repair or improvement of existing assets in accordance with the Company or one or more Restricted Subsidiariesterms of this Indenture; provided that a binding commitment the Company may elect to make an acquisition referred deem Investments or capital expenditures within the scope of the foregoing clauses (ii) or (iii), as applicable, that occur prior to the receipt of the Net Proceeds to have been made in clause accordance with such clauses (ii) or (iii) above so long as such deemed Investments or capital expenditures shall have been made no earlier than the earlier of (x) the execution of a definitive agreement relating to such Asset Sale and (y) the consummation of such Asset Sale; and/or
(iv) any combination of the foregoing; provided that a binding commitment or letter of intent shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided commitment or letter of intent so long as the Company or a Restricted Subsidiary enters into such commitment with the good faith expectation that (x) such investment is consummated Net Proceeds will be applied to satisfy such commitment within 180 days of the end expiration of the 360-day Asset Sale Proceeds Application Period (an “Acceptable Commitment”) and such Net Proceeds are actually applied substantially in such manner within 180 days of the expiration of the Asset Sale Proceeds Application Period (the period referred from the consummation of the Asset Sale to such date, the “First Commitment Application Period”) or, in the first sentence event any Acceptable Commitment is later terminated or cancelled prior to the application of this paragraph such Net Proceeds or such Net Proceeds are not so applied within such First Commitment Application Period, then such Net Proceeds shall constitute Excess Proceeds unless the Company or such Restricted Subsidiary reasonably intends to enter into another Acceptable Commitment prior to the expiration of the First Commitment Application Period (a “Second Commitment”) and (y) such Net Proceeds are actually applied substantially in such manner within 180 days of the date of entering into the Second Commitment; provided, further, that if any Second Commitment is cancelled or terminated for any reason before such acquisition Net Proceeds are applied or if the date of such Second Commitment is not consummated prior to the date of the expiration of the First Commitment Application Period then such Net Proceeds shall constitute Excess Proceeds.
(c) Any Net Proceeds from an Asset Sale not applied or invested as provided and within the time period set forth in Section 4.14(b) will be deemed to constitute “Excess Proceeds”; provided that any amount of Net Proceeds offered to Holders of the Notes pursuant to clause (xi)(B)(II) or such binding commitment is terminated, the Net Cash Proceeds of Section 4.14(b) shall not so applied will be deemed to be Excess Proceeds without regard to whether such offer is accepted by any Holders. In no event later than 20 Business Days after any date (as defined below). For a “Asset Sale Offer Trigger Date”) that the aggregate amount of Excess Proceeds exceeds $75.0 million, the Company shall commence an offer (an “Asset Sale Offer”) to all Holders of Notes and, if required or permitted by the terms of any Pari Passu Indebtedness (including, for the avoidance of doubt, pending application thereof in accordance with this Section 4.09the Secured Notes and the Existing Notes), the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end holders of such Pari Passu Indebtedness as selected by the 360-day period referred Company, to in purchase the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding maximum aggregate principal amount (or accreted value, as applicable) of the Notes and (y) such Pari Passu Indebtedness that is, with respect to the denominator of which is Notes only, in an amount equal to $1,000, or an integral multiple of $1,000 in excess thereof, that may be purchased out of the outstanding aggregate principal amount Excess Proceeds at an offer price, in the case of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required only, in cash in an amount equal to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof (or accreted value thereof, if less), plus accrued interest and unpaid interest, if any, to, but excluding excluding, the date fixed for the closing of purchasesuch offer, in accordance with the procedures set forth in this Indenture, and in the case of such Pari Passu Indebtedness, at the offer price required by the terms thereof, in accordance with the procedures set forth in the agreement(s) governing such Pari Passu Indebtedness. The Company may satisfy the foregoing obligations with respect to any Net Proceeds from an Asset Sale by making an Asset Sale Offer with respect to such Net Proceeds prior to the time period that may be required by this Indenture with respect to all or a part of the available Net Proceeds (the “Advance Portion”) in advance of being required to do so by this Indenture (an “Advance Offer”). To the extent that the aggregate amount (or accreted value, if applicable) of Notes and Pari Passu Indebtedness, as the case may be, tendered pursuant to an Asset Sale Offer is less than the amount offered in the Asset Sale Offer (or in the case of an Advance Offer, the Advance Portion), the Company may use any remaining Excess Proceeds (or in the case of an Advance Offer, the Advance Portion) (“Declined Proceeds”) for any purposes not otherwise prohibited under this Indenture. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount (or accreted value, if applicable) of Notes or the Pari Passu Indebtedness, as the case may be, surrendered by such holders thereof exceeds the amount offered in excess the Asset Sale Offer (or in the case of the purchase amount are tendered and not withdrawn pursuant to the offeran Advance Offer, the Issuers Advance Portion), the Company shall purchase the Notes having an aggregate principal amount equal (subject to applicable DTC procedures as to Global Notes) and such Pari Passu Indebtedness, as the purchase amount case may be, on a pro rata basis to based on the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 aggregate principal amount (and in a minimum amount or accreted value, if applicable) of $1,000) the Notes or such Pari Passu Indebtedness, as the case may be, tendered with adjustments as necessary so that no Notes or Pari Passu Indebtedness, as the case may be, will be purchased (or if a PIK Payment has been made, repurchased in denominations of $1.00 and any integral multiple of $1.00 part in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest)an unauthorized denomination. Upon completion of any such Asset Sale Offer (or Advance Offer), the Offer to Purchase, amount of Excess Proceeds will (or in the case of an Advance Offer, the Advance Portion) that resulted in the requirement to make an Asset Sale Offer shall be reset at zero, and to zero (regardless of whether there are any remaining Excess Proceeds (or Advance Portion) upon such completion). Upon consummation or expiration of any Asset Sale Offer (or Advance Offer), any remaining after consummation of Net Proceeds shall not be deemed Excess Proceeds and the Offer to Purchase Company may be used use such Net Proceeds for any purpose not otherwise prohibited under this Indenture.
(d) An Asset Sale Offer or Advance Offer may be made at the same time as consents are solicited with respect to an amendment, supplement or waiver of this Indenture, Notes, and/or Guarantees (but the Asset Sale Offer or Advance Offer may not condition tenders on the delivery of such consents).
(e) Pending the final application of an amount equal to the Net Proceeds pursuant to this Section 4.14, the holder of such Net Proceeds may apply any Net Proceeds temporarily to reduce Indebtedness outstanding under a revolving credit facility (including under the Senior Secured Credit Agreement) or otherwise invest such Net Proceeds in any manner not prohibited by this Indenture.
(f) In connection with an Asset Sale Offer or Advance Offer, the Company shall deliver to each Holder of Notes a notice stating: (i) that the Company is offering to purchase the aggregate principal amount of Notes required to be offered for purchase pursuant to this Section 4.14 (and identifying other Indebtedness, if any, that is participating pro rata in such offer) on the date of purchase (the “Asset Sale Offer Purchase Date”), which shall be a Business Day, specified in such notice, that is not earlier than 30 days or later than 60 days from the date such notice is mailed, (ii) the amount of accrued and unpaid interest as of the Asset Sale Offer Purchase Date, (iii) that any Note not tendered will continue to accrue interest, (iv) that, unless the Company defaults in the payment of the purchase price for the Notes payable pursuant to such offer, any Notes accepted for payment pursuant to such offer shall cease to accrue interest after the Asset Sale Offer Purchase Date, (v) the procedures, consistent with this Indenture, to be followed by a holder of Notes in order to accept such offer or to withdraw such acceptance, and (vi) such other information as may be required by this Indenture and applicable laws and regulations.
(g) On the Asset Sale Offer Purchase Date, the Company will (i) apply all Excess Proceeds to the purchase of the aggregate principal amount of Notes and, if applicable, Pari Passu Indebtedness (on a pro rata basis, if applicable) offered for purchase pursuant to this Section 4.14 (the “Asset Sale Offer Amount”) or, if less than the Asset Sale Offer Amount of Notes (and, if applicable, Pari Passu Indebtedness) has been so validly tendered, all Notes or Pari Passu Indebtedness validly tendered in response to such offer, (ii) deposit with the Paying Agent the aggregate purchase price of all Notes or portions thereof accepted for payment and any accrued and unpaid interest on such Notes as of the Asset Sale Offer Purchase Date, and (iii) deliver or cause to be delivered to the Trustee all Notes tendered pursuant to the Asset Sale Offer or Advance Offer. The Issuers If less than all Notes tendered pursuant to the Asset Sale Offer or Advance Offer are accepted for payment by the Company for any reason consistent with this Indenture, selection of the Notes to be purchased by the Company shall comply be in compliance with the requirements of Rule 14e-1 under the Exchange Act principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not so listed, on a pro rata basis, by lot or by such method as the Trustee shall deem fair and appropriate or otherwise in accordance with the procedures of DTC; provided that Notes accepted for payment in part shall only be purchased in integral multiples of $1,000. The Paying Agent shall promptly deliver to each Holder of Notes or portions thereof accepted for payment an amount equal to the purchase price for such Notes plus any accrued and unpaid interest thereon, and the Trustee shall promptly authenticate and mail to such holder of Notes accepted for payment in part a new Note equal in principal amount to any unpurchased portion of the Notes, and any other securities laws and regulations thereunder Note not accepted for payment in whole or in part shall be promptly returned to the extent such laws and regulations are applicable in connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue holder of such conflict.Note. On and after an Asset Sale Offer Purchase Date, interest will cease
Appears in 1 contract
Sources: Indenture (E.W. SCRIPPS Co)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any Restricted Subsidiary to, make any Asset Sale unless (i) the following conditions are met:
Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the fair market value (aas evidenced by a resolution of the Board of Directors set forth in an Officers' Certificate delivered to the Trustee) of the assets or other property sold or disposed of in the Asset Sale is for at least Fair Market Value; and
and (bii) at least 75% of the such consideration received by the Company or its Restricted Subsidiaries consists of either cash or Cash Equivalents; provided provided, however, that (A) for purposes of this clause Section 4.16, "cash" shall include (2), each of the following shall be considered cash or Cash Equivalents:
(ix) the assumption by the purchaser amount of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) any Indebtedness (other than Subordinated Debt or other obligations or liabilities any Indebtedness that is by its terms subordinated in right of payment to the Notes) of the Company or a such Restricted Subsidiary pursuant as shown on the Company's or such Restricted Subsidiary's most recent balance sheet or in the notes thereto that is assumed by the transferee of any such assets or other property in such Asset Sale (and excluding any liabilities that are incurred in connection with or in anticipation of such Asset Sale), but only to operation the extent that such assumption is effected on a basis such that there is no further recourse to the Company or any of law or a customary novation agreement,
the Restricted Subsidiaries with respect to such liabilities and (iiy) Additional Assets,
(iii) instruments, any notes, obligations or securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event converted within 90 60 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash received) and (B) the 75% cash or Cash Equivalents actually so receivedrequirement will not apply to any sale of all or substantially all of the assets or Capital Stock of ICN Biomedicals, andInc.
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(cb) Within 360 days one year after the receipt of any Net Cash Proceeds from an Asset Sale, the Company or the applicable Restricted Subsidiary may elect to apply the Net Cash Proceeds may be used:
from such Asset Sale to (ia) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Senior Bank Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to and/or (b) make an acquisition referred to in clause (ii) investment in, or (iii) above shall acquire assets and properties that will be treated as used in, a permitted Related Business. Pending the final application of the any such Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09Proceeds, the Company or any Restricted Subsidiary may use temporarily invest such Net Proceeds in any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings Investments described under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
clauses (i) accumulated Excess Proceeds, multiplied by
through (iiiii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator definition of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.Permitted
Appears in 1 contract
Sources: Indenture (Icn Pharmaceuticals Inc)
Limitation on Asset Sales. The Company shall ▇▇▇▇▇▇ Publishing will not, and shall will not cause or permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) ▇▇▇▇▇▇ Publishing or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by ▇▇▇▇▇▇ Publishing’s Board of Directors);
(b2) at least 75% of the consideration received by ▇▇▇▇▇▇ Publishing or the Company or its Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or cash, Cash Equivalents; provided that for purposes of this clause (2), each Equivalents and/or assets of the following shall be considered cash or Cash Equivalents:
same type having the same general utility as the subject assets, as determined by Issuer (“Replacement Assets”) and is received at the time of such disposition; provided, however, that the amount of (i) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company▇▇▇▇▇▇ Publishing’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes notes thereto) of ▇▇▇▇▇▇ Publishing or any such Restricted Subsidiary (other than Subordinated Debt or other obligations or liabilities that are by their terms subordinated in right of payment to the NotesNotes or any Guarantee of a Guarantor) that are assumed by the transferee of the Company or a Restricted Subsidiary pursuant any such assets shall be deemed to operation be cash for purposes of law or a customary novation agreement,
this provision and (ii) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company ▇▇▇▇▇▇ Publishing or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, immediately converted by the Company ▇▇▇▇▇▇ Publishing or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually received) shall be deemed, to the extent of cash so received, to be cash for purposes of this provision; and
(iv3) any Designated Non-Cash Consideration received by upon the Company consummation of an Asset Sale, ▇▇▇▇▇▇ Publishing shall apply, or cause such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Saleapply, the Net Cash Proceeds may be usedrelating to such Asset Sale within 180 days of receipt thereof:
(ia) to permanently repay (A) prepay any Senior Debt outstanding under the Credit Agreement (or Guarantor Senior Debt and, in the case of the repayment of the any Senior Debt or Guarantor Senior Debt under any revolving credit facility (other than the Working Capital Facility), effect a permanent reduction in the availability under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,revolving credit facility; and/or
(ii) to acquire Additional Assets; or
(iiib) to make capital expenditures in an offer to all Holders and the Tranche B Lender to reduce the balance on the Tranche B Loan and to repurchase the maximum principal amount of Notes, on a Permitted Business of the Company or one or more Restricted Subsidiaries; provided pro rata basis, that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall may be treated as a permitted application reduced and purchased out of the Net Cash Proceeds from (or the portion thereof not applied pursuant to clause (a) above) at a Purchase Price in cash in an amount equal to 101% of the principal amount thereof, together with accrued and unpaid interest to the date fixed for the closing of such commitment; provided that (x) such investment is consummated within 180 days of offer, in accordance with the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period procedures set forth in clause Section 3.10 (xa “Net Proceeds Offer”).
(4) or such binding commitment is terminatedNotwithstanding the foregoing, the all Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubtany Collateral in respect of any Asset Sale shall, pending their application thereof in accordance with this Section 4.094.10 or the release thereof in accordance with the provisions of the Security Documents, be deposited in an account subject to a deposit account control agreement as provided in the Security Documents. In the event of the transfer of substantially all (but not all) of the property and assets of ▇▇▇▇▇▇ Publishing and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the Company successor corporation shall be deemed to have sold the properties and assets of ▇▇▇▇▇▇ Publishing and its Restricted Subsidiaries not so transferred for purposes of this covenant, and shall comply with the provisions of this covenant with respect to such deemed sale as if it were an Asset Sale. In addition, the fair market value of such properties and assets of ▇▇▇▇▇▇ Publishing or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this covenant. ▇▇▇▇▇▇ Publishing will not, and will not cause or permit any of its Restricted Subsidiaries to, engage in any Asset Swaps, unless:
(1) at the time of entering into such Asset Swap and immediately after giving effect to such Asset Swap, no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof; (2) in the event such Asset Swap involves the transfer by ▇▇▇▇▇▇ Publishing or any Restricted Subsidiary may use any Net Cash Proceeds from of assets having an aggregate fair market value in excess of $25.0 million, either (i) the terms of such Asset Sale for general corporate purposes Swap shall be approved by a majority of the Independent Directors of ▇▇▇▇▇▇ Publishing, but in no event fewer than two Independent Directors of ▇▇▇▇▇▇ Publishing, such approval to be evidenced by a Board Resolution stating that such Independent Directors have determined that such transaction complies with the foregoing provisions or, (including a reduction ii) in borrowings under any revolving credit facility) the event there are fewer than two such Independent Directors, ▇▇▇▇▇▇ Publishing shall, prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)consummation thereof, the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having obtain a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal favorable opinion as to the outstanding aggregate principal amount fairness of such Asset Swap to ▇▇▇▇▇▇ Publishing or such Restricted Subsidiary, as the Notes case may be, from a financial point of view, from an Independent Financial Advisor and (y) file the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu same with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.Trustee; and
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company's Board of Directors);
(b2) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash cash, Cash Equivalents and/or Replacement Assets (or Cash Equivalents; provided that for a combination thereof). For purposes of this clause (2)provision, each of the following shall will be considered cash or Cash Equivalentsdeemed to be cash:
(iA) the assumption by the purchaser of Debt or other obligations or liabilities (any liabilities, as shown on the Company’s 's most recent consolidated balance sheet sheet, of the Company or in the footnotes thereto) any Restricted Subsidiary (other than Subordinated Debt or other obligations or contingent liabilities and liabilities that are by their terms subordinated in right of payment to the Notes) that are assumed by the transferee of any such assets pursuant to an agreement that releases the Company or a such Restricted Subsidiary pursuant from further liability or with respect to operation of law which the transferee has granted a full and complete indemnity to the Company or a customary novation agreement,such Restricted Subsidiary; and
(iiB) Additional Assets,
(iii) instrumentsany securities, notes, securities notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalentsinto cash, to the extent of the cash received in that conversion, within 180 days after receipt; and
(3) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Equivalents actually so receivedProceeds relating to such Asset Sale within 365 days of receipt thereof either:
(A) in the case of any disposition of Collateral constituting an Asset Sale during any First Priority Period,
(i) to make an investment in Replacement Assets; provided that the Company or such Guarantor, as the case may be, shall execute and deliver to the Trustee such Security Documents or other instruments as shall be reasonably necessary to cause such property or assets to become subject to the Lien of the applicable Security Documents;
(ii) to make capital expenditures in any Permitted Business; provided that, to the extent it constitutes Collateral, the Company or such Guarantor, as the case may be, shall execute and deliver to the Trustee such Security Documents or other instruments as shall be reasonably necessary to cause such property or assets to become subject to the Lien of the applicable Security Documents;
(iii) to make Investments in Permitted Joint Ventures; and
(iv) any Designated Non-Cash Consideration received a combination of investment and expenditures permitted by the Company or such Restricted Subsidiary foregoing clauses (i) through (iii); or
(B) in the case of any Asset Sale having an aggregate Fair Market Valueother than a disposition of Collateral during any First Priority Period, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million or in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt case of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:Sale at any other time,
(i) to permanently repay (A) Debt outstanding any Indebtedness under the any Credit Agreement (Facility and, in the case of any such Indebtedness repaid under a revolving credit facility, effect a permanent reduction in the repayment of the availability under such revolving credit facility under to the Credit Agreement, to permanently reduce the commitment thereunder extent that such Net Cash Proceeds are not reborrowed and applied as contemplated by any other clause hereof within such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,365-day period;
(ii) to acquire Additional Assets; orrepay (or repurchase) any secured Indebtedness;
(iii) to repay (or repurchase) any Indebtedness of a Restricted Subsidiary that is not a Guarantor;
(iv) to repay (or repurchase) any Indebtedness with a final Stated Maturity that is prior to the final Stated Maturity of the Notes;
(v) to make a capital expenditures expenditure;
(vi) to acquire other long-term assets that are used or useful in a Permitted Business Business;
(vii) to acquire all or substantially all of the assets of, or a majority of the Voting Stock, of a Permitted Business (including by means of a merger, consolidation or other business combination permitted under this Indenture); or
(viii) a combination of prepayment and investment permitted by the foregoing clauses (i) through (vii).
(b) If on the 366th day after an Asset Sale the Company has not applied or one invested the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (3)(A) and (3)(B) of paragraph (a) of this Section 4.10 (each, a "Net Proceeds Offer Trigger Date"), such aggregate amount of Net Cash Proceeds which has not been applied or more Restricted Subsidiaries; provided that invested on or before such Net Proceeds Offer Trigger Date as permitted in clauses (3)(A) and (3)(B) of paragraph (a) of this Section 4.10 (each a binding commitment "Net Proceeds Offer Amount") shall be applied by the Company to make an acquisition referred offer to in clause purchase (iithe "Net Proceeds Offer") or (iii) above shall pursuant to Section 3.10 and this Section 4.10 to all Holders and, at the Company's option, to all holders of other Indebtedness that is pari passu with the Notes from all Holders pro rata, the maximum amount of Notes and such other pari passu Indebtedness equal to the Net Proceeds Offer Amount with respect to the Notes, at a price equal to 100% of the principal amount of the Notes to be treated as a permitted purchased, plus accrued and unpaid interest thereon, if any, to the Purchase Date. Pending application -55- of the Net Cash Proceeds, the Net Cash Proceeds from the date Asset Sales of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to Collateral during any First Priority Period shall be deposited in the first sentence of this paragraph and Collateral Account to the extent one is required by Section 12.1.
(yc) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, If at any time any non-cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than contemplated by clause (2)(B) above and other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction thereof shall be applied in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of accordance with this Section 4.09(c)4.10.
(d) When Notwithstanding anything in this Section 4.10 to the contrary, the Company shall have no obligation to make a Net Proceeds Offer until there is an aggregate amount unutilized Net Proceeds Offer Amount equal to or in excess of Net Cash Proceeds $10.0 million resulting from one or more Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)at which time, the Issuers mustentire unutilized Net Proceeds Offer Amount, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) and not just the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn $10.0 million, shall be applied as required pursuant to this Section).
(e) In the offerevent of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the Issuers successor corporation shall purchase Notes having an aggregate principal amount equal be deemed to have sold the purchase amount on a pro rata basis to the extent practicable, with adjustments by properties and assets of the Company and its Restricted Subsidiaries not so that only Notes in multiples transferred for purposes of $1,000 principal amount (this Section, and in a minimum amount shall comply with the provisions of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof this Section with respect to a PIK Note or such deemed sale as if it were an Asset Sale. In addition, the portion fair market value of a Global Note constituting PIK Interest). Upon completion such properties and assets of the Offer Company or its Restricted Subsidiaries deemed to Purchase, Excess be sold shall be deemed to be Net Cash Proceeds will be reset at zero, and for purposes of this Section.
(f) If any Excess Net Proceeds remaining remain after consummation of a Net Proceeds Offer, the Offer to Purchase Company may be used use those proceeds for any purpose not otherwise prohibited by this Indenture. Upon completion of each Net Proceeds Offer, the Net Proceeds Offer Amount will be reset at zero.
(g) The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with this Section 4.09 4.10 or Section 3.023.10, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 4.10 or Section 3.02 3.10 by virtue of such conflictthereof.
Appears in 1 contract
Sources: Indenture (Dan River Inc /Ga/)
Limitation on Asset Sales. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of such Asset Sale is for at least Fair Market Valueequal to the fair market value of the assets or Equity Interests issued or sold or otherwise disposed of, as approved in good faith by the Company’s Board of Directors; and
(b2) at least 75% of the consideration therefor received by the Company or its such Restricted Subsidiaries consists Subsidiary is in the form of cash or Cash Equivalents; provided that for . For purposes of this clause provision only (2and specifically not for the purposes of the definition of “Net Proceeds”), each of the following shall be considered cash or Cash Equivalentsdeemed to be cash:
(i) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than contingent liabilities and liabilities that are by their terms subordinated to operation the Notes or any Subsidiary Guarantee) that are assumed by the transferee of law or a customary novation agreement,any such assets; and
(ii) Additional Assets,
(iii) instrumentsany securities, notes, securities notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that within 180 days are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received, received in that conversion); and
(iviii) the fair market value of (x) any Designated Non-Cash Consideration assets (other than securities or current assets) received by the Company or such any Restricted Subsidiary that will be used or useful in the Asset Sale having an aggregate Fair Market Valuea Related Business, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (dy) Equity Interests in a Person that is at a Restricted Subsidiary or in a Person engaged in a Related Business that time outstanding, not to exceed shall become a Restricted Subsidiary immediately upon the acquisition of such Equity Interests by the Company or the applicable Restricted Subsidiary or (z) a combination of (x) $10.0 million per fiscal year and (y); provided that the determination of the fair market value of assets or Equity Interests in excess of $75.0 million received in any transaction or series of related transactions shall be evidenced by an Officers’ Certificate delivered to the Trustee.
(b) $30.0 million in the aggregate since Within a period of 450 days (commencing after the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(cDate) Within 360 days before or after the receipt of any Net Cash Proceeds of any Asset Sale (provided that if during such 450-day period after the receipt of any such Net Proceeds the Company (or the applicable Restricted Subsidiary) enters into a definitive binding agreement committing it to apply such Net Proceeds in accordance with the requirements of clause (B), (D) or (E) of this paragraph after such 450th day, such 450-day period will be extended with respect to the amount of Net Proceeds so committed for a period not to exceed 180 days until such Net Proceeds are required to be applied in accordance with such agreement (or, if earlier, until termination of such agreement)), the Company or such Restricted Subsidiary, at its option, may apply an amount equal to the Net Proceeds from an such Asset Sale, the Net Cash Proceeds may be used:
(iA) to permanently repay repay, prepay, redeem or repurchase Indebtedness (Aother than securities) Debt outstanding under Credit Facilities or Indebtedness of a Restricted Subsidiary that is not a Guarantor (other than Indebtedness of such Restricted Subsidiary owed to the Credit Agreement (Company or any of its Restricted Subsidiaries) and, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the repayment of the availability under such revolving credit facility (or effect a permanent reduction in the availability under such revolving credit facility regardless of the Credit Agreement, fact that no prepayment is required in order to permanently reduce the commitment thereunder by such amount) or do so (in which case no prepayment shall be required));
(B) to acquire Equity Interests in a Person that is a Restricted Subsidiary or in a Person engaged in a Related Business that shall become a Restricted Subsidiary immediately upon the Notes and any Debt secured acquisition of such Equity Interests by Liens ranking pari passu with the Liens securing Company or the Notes (if any) through making the Offer to Purchase below,applicable Restricted Subsidiary;
(iiC) to make capital expenditures;
(D) to acquire Additional Assetsother assets (other than securities or current assets) that will be used or useful in a Related Business;
(E) to make Investments in Joint Ventures pursuant to clauses (13) and (14) of the definition of “Permitted Investments”; or
(iiiF) to make capital expenditures in a Permitted Business combination of prepayment and investment permitted by the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause foregoing clauses (iiA), (B), (C), (D) or and (iiiE).
(c) above shall be treated as a permitted Pending the final application of the such Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09Proceeds, the Company or any Restricted Subsidiary may use temporarily reduce borrowings under the Credit Facilities or any other revolving credit facility or Receivables Financings, if any, or otherwise invest such Net Proceeds in Cash Proceeds from Equivalents, in each case in a manner not prohibited by this Indenture. Subject to the last sentence of this paragraph, on the 451st day (as extended pursuant to the provisions in Section 4.10(b)) after an Asset Sale for general corporate purposes or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Proceeds relating to such Asset Sale as set forth in clause (A), (B), (C), (D), (E) or (F) of Section 4.10(b) (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Proceeds which have not been applied (or committed to be applied pursuant to a definitive agreement as described in Section 4.10(b)) on or before such Net Proceeds Offer Trigger Date as permitted in clause (A), (B), (C), (D), (E) or (F) of Section 4.10(b) (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary to make an offer to purchase (the “Net Proceeds Offer”) on the Purchase Date, from all Holders (and, if required by the terms of any other Indebtedness of the Company ranking pari passu with the Notes in right of payment and which has similar provisions requiring the Company either to make an offer to repurchase or to otherwise repurchase, redeem or repay such Indebtedness with the proceeds from Asset Sales, including the 2023 Notes and the related Guarantees thereof (the “Pari Passu Indebtedness”), from the holders of such Pari Passu Indebtedness) on a reduction pro rata basis (in borrowings under any revolving credit facility) prior proportion to the end respective principal amounts or accreted value, as the case may be, of the 360Notes and any such Pari Passu Indebtedness) an aggregate principal amount of Notes (plus, if applicable, an aggregate principal amount or accreted value, as the case may be, of Pari Passu Indebtedness) equal to the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Notes (or 100% of the principal amount or accreted value, as the case may be, of such Pari Passu Indebtedness), plus accrued and unpaid interest thereon, if any, to the Purchase Date; provided, however, that if at any time any non-day period referred cash consideration received by the Company or any Restricted Subsidiary, as the case may be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Proceeds thereof shall be applied in accordance with this covenant. The Company may defer the first sentence Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $125.0 million resulting from one or more Asset Sales (at which time the entire unutilized Net Proceeds Offer Amount, and not just the amount in excess of $125.0 million, shall be applied as required pursuant to this Section 4.09(cparagraph, and in which case the Net Proceeds Offer Trigger Date shall be deemed to be the earliest date that the Net Proceeds Offer Amount is equal to or in excess of $125.0 million).
(d) When To the extent that the aggregate principal amount of Net Cash Proceeds from Asset Sales not applied Notes (plus, if applicable, the aggregate principal amount or accreted value, as the case may be, of Pari Passu Indebtedness) validly tendered pursuant to (a Net Proceeds Offer by the Holders thereof and within not withdrawn exceeds the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02Net Proceeds Offer Amount, Notes having of tendering Holders (and, if applicable Pari Passu Indebtedness tendered by the holders thereof) will be purchased on a principal amount equal to:
pro rata basis (i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) based on the numerator of which is equal to the outstanding aggregate principal amount of the Notes and, if applicable, the principal amount or accreted value, as the case may be, of any such Pari Passu Indebtedness tendered and (y) not withdrawn). To the denominator of which is equal to extent that the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on (plus, if applicable, the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess or accreted value, as the case may be, of the purchase amount are any Pari Passu Indebtedness) tendered and not withdrawn pursuant to a Net Proceeds Offer is less than the offerNet Proceeds Offer Amount, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (may use such excess Net Proceeds Offer Amount for general corporate purposes or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any other purpose not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law.
(e) The Issuers shall Company or the applicable Restricted Subsidiary, as the case may be, will comply with the requirements of 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 connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 4.10 or Section 3.023.09, the Issuers Company or such Restricted Subsidiary shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 Indenture by virtue of such conflictthereof.
Appears in 1 contract
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Valueequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company's Board of Directors); and
(bii) at least 7580% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash EquivalentsEquivalents and is received at the time of such disposition; provided and (iii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 365 days of receipt thereof either (A) to prepay any Senior Debt and, in the case of any Senior Debt under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility, (B) to make an investment in properties and assets that for purposes replace the properties and assets that were the subject of this clause such Asset Sale or in properties and assets that will be used in the business of the Company and its Subsidiaries as existing on the Issue Date or in businesses reasonably related thereto (2"Replacement Assets"), each or (C) a combination of the following shall be considered cash or Cash Equivalents:
(i) the assumption prepayment and investment permitted by the purchaser foregoing clauses (iii)(A) and (iii)(B). On the 366th day after an Asset Sale or such earlier date, if any, as the Board of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) Directors of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from determines not to apply the purchaser that are promptlyNet Cash Proceeds relating to such Asset Sale as set forth in clause (iii)(A), but in any event within 90 days (iii)(B) or (iii)(C) of the closingnext preceding sentence (each, converted a "Net Proceeds Offer Trigger Date"), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each a "Net Proceeds Offer Amount") shall be applied by the Company or such Restricted Subsidiary to cash or Cash Equivalentsmake an offer to purchase (the "Net Proceeds Offer") on a date (the "Net Proceeds Offer Payment Date") not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, from all Holders on a pro rata basis, that amount of Notes equal to the extent Net Proceeds Offer Amount at a price equal to 100% of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case principal amount of the repayment of the revolving credit facility under the Credit AgreementNotes to be purchased, plus accrued interest thereon to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitmentpurchase; provided provided, however, that (x) such investment is consummated within 180 days of the end of the 360if at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not thereof shall be applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) this covenant. The Company may defer the numerator of which Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $5.0 million resulting from one or more Asset Sales (at which time, the outstanding aggregate principal amount of entire unutilized Net Proceeds Offer Amount, and not just the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn $5.0 million, shall be applied as required pursuant to this paragraph). In the offerevent of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01, the Issuers successor corporation shall purchase Notes having be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this covenant, and shall comply with the provisions of this covenant with respect to such deemed sale as if it were an aggregate principal amount equal Asset Sale. In addition, the fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this Section 4.16. Notwithstanding the two immediately preceding paragraphs, the Company and its Restricted Subsidiaries shall be permitted to consummate an Asset Sale without complying with such paragraphs to the purchase extent (i) at least 80% of the consideration for such Asset Sale constitutes Replacement Assets and (ii) such Asset Sale is for fair market value; provided that any consideration not constituting Replacement Assets received by the Company or any of its Restricted Subsidiaries in connection with any Asset Sale permitted to be consummated under this paragraph shall constitute Net Cash Proceeds subject to the provisions of the two preceding paragraphs. Each Net Proceeds Offer will be mailed to the record Holders as shown on the register of Holders within 25 days following the Net Proceeds Offer Trigger Date, with a copy to the Trustee, and shall comply with the procedures set forth in this Indenture. Upon receiving notice of the Net Proceeds Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1,000 in exchange for cash. To the extent Holders properly tender Notes in an amount exceeding the Net Proceeds Offer Amount, Notes of tendering Holders will be purchased on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interestbased on amounts tendered). Upon completion A Net Proceeds Offer shall remain open for a period of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase 20 business days or such longer period as may be used for any purpose not otherwise prohibited required by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflictlaw.
Appears in 1 contract
Sources: Indenture (Dyncorp)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any Restricted Subsidiary to, make engage in any Asset Sale unless the following conditions are met:
(ai) the Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least equal to the Fair Market Value; and
Value of the Properties sold or otherwise disposed of pursuant to the Asset Sale, (bii) at least 7585% of the consideration received by the Company or the Restricted Subsidiary, as the case may be, in respect of such Asset Sale consists of cash, Cash Equivalents or properties used in the Oil and Gas Business of the Company or its Restricted Subsidiaries consists of cash or Cash Equivalents; provided and (iii) the Company delivers to the Trustee an Officers' Certificate certifying that for purposes of this clause (2), each of the following shall be considered cash or Cash Equivalents:
such Asset Sale complies with clauses (i) the assumption by the purchaser and (ii) of Debt or other obligations or liabilities this Section 10.17(a). The amount (as shown on the Company’s most recent balance sheet or in the footnotes theretowithout duplication) of any Indebtedness (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the NotesIndebtedness) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from that is expressly assumed by the purchaser that are promptlytransferee in such Asset Sale and with respect to which the Company or such Restricted Subsidiary, but in any event within 90 days as the case may be, is unconditionally released by the holder of such Indebtedness, shall be deemed to be cash or Cash Equivalents for purposes of clause (ii) and shall also be deemed to constitute a repayment of, and a permanent reduction in, the amount of such Indebtedness for purposes of the closingfollowing paragraph.
(b) If the Company or any Restricted Subsidiary engages in an Asset Sale, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalentsmay either, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within no later than 360 days after the receipt of any Net Cash Proceeds from an such Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) apply all or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Available Proceeds from the date therefrom to repay Indebtedness (other than Subordinated Indebtedness) of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction Subsidiary, provided in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.each case
Appears in 1 contract
Sources: Indenture (KCS Energy Inc)
Limitation on Asset Sales. (a) The Company shall will not, and shall will not permit any of the Restricted Subsidiary Subsidiaries to, make directly or indirectly, consummate any Asset Sale unless the following conditions are metunless:
(a1) the Company or the Restricted Subsidiary, as the case may be, receives or will receive, at the consummation of such Asset Sale is for Sale, consideration at least equal to the Fair Market ValueValue (as determined at the time of contractually agreeing to such Asset Sale) of the assets or Equity Interests issued or sold or otherwise disposed of; and
(b2) at least 75% of the consideration received in such Asset Sale by the Company or its such Restricted Subsidiaries consists Subsidiary is in the form of cash or Cash Equivalents; provided that for the foregoing requirements shall not apply with respect to any Involuntary Transfer.
(b) For purposes of this clause (2Section 4.10(a), each of the following shall will be considered cash or Cash Equivalentsdeemed to be cash:
(i1) the assumption by the purchaser of Debt any Indebtedness or other obligations or liabilities (liabilities, as shown on the Company’s most recent consolidated balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) sheet, of the Company or a any Restricted Subsidiary pursuant (other than contingent liabilities and liabilities that are by their terms subordinated to operation the Notes or any Guarantee) that are assumed, repaid or retired by the transferee of law any such assets so long as the Company or a customary novation agreement,such Restricted Subsidiary is released from further liability in respect thereof; and
(ii2) Additional Assets,
(iii) instrumentsany securities, notes, securities notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptlyare, but in any event within 90 180 days of the closingafter receipt thereof, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);conversion.
(c) Within 360 365 days after the receipt of any Net Cash Proceeds from (including, without limitation, an Asset SaleInvoluntary Transfer), the Company or the applicable Restricted Subsidiary, as the case may be, may apply such Net Cash Proceeds may be usedat its option to any combination of the following:
(i1) to permanently purchase, repay or prepay First Lien Debt; provided that if any such purchase, repayment or prepayment is made pursuant to this clause (A1), the Company or the applicable Restricted Subsidiary shall equally and ratably repay or offer to repay Notes as provided in Section 3.07 through open-market purchases (to the extent such purchases are at or above 100% of the principal amount there-of) Debt outstanding under or by making an offer to Holders in accordance with the Credit Agreement procedures set forth in Section 3.09 and this Section 4.10 for an Asset Sale Offer;
(and2) to acquire all or substantially all of the assets of, or any Capital Stock of, any Person primarily engaged in a Permitted Business, if, in the case of the repayment any such acquisition of the revolving credit facility under the Credit AgreementCapital Stock, to permanently reduce the commitment thereunder by such amount) Person is or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,becomes a Restricted Subsidiary as a result of such acquisition;
(ii3) to acquire Additional Assetsmake a capital expenditure (other than a maintenance capital expenditure) that is used or useful in a Permitted Business; or
(iii4) to make capital expenditures acquire other assets that are not classified as current assets under GAAP and that are used or useful in a Permitted Business (including, without limitation, Vessels, related assets and the payment of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (iiany related Ready for Sea Costs) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date make any deposit, installment or progress payment in respect of such commitment; assets or payment of any related Ready for Sea Costs, provided that (x) such investment is consummated a binding commitment made within 180 days of the end of the 360365-day period referred described above by the Company or the applicable Restricted Subsidiary to apply Net Proceeds in accordance with clauses (2), (3) and/or (4) above shall satisfy the first sentence requirements of this paragraph such clauses with respect to such Net Proceeds so long as such Net Proceeds are actually so applied within 545 days from the receipt thereof from such Asset Sale and (y) if all or any portion of the assets sold or transferred in such acquisition is not consummated within Asset Sale constituted Collateral, in the period set forth in case of any application of Net Proceeds pursuant to clause (x2), (3) or such binding commitment is terminated(4) above, the Company shall, or shall cause the applicable Restricted Subsidiary to, as provided in Section 11.01(f)(ii), subject to the Agreed Security Principles, pledge any assets (including, without limitation, any acquired Capital Stock) acquired with such Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For secure the avoidance of doubt, pending application thereof Notes Obligations on a first-priority secured basis pursuant to the Collateral Documents in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c)Indenture.
(d) Pending the final application of any Net Proceeds, the Company or the applicable Restricted Subsidiary may apply the Net Proceeds to temporarily reduce outstanding revolving credit Indebtedness of the Company or any of the Restricted Subsidiaries, respectively, or invest the Net Proceeds in cash and Cash Equivalents.
(e) Any Net Proceeds that are not applied or invested as provided in Section 4.10(c) will constitute “Excess Proceeds.” When the aggregate amount of Net Cash Excess Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)25 million, the Issuers mustCompany shall, within 30 days10 Business Days thereof, make an offer to purchase, (an “Asset Sale Offer”) in accordance with Section 3.023.09 to all Holders and holders of any other First Lien Debt containing provisions similar to those set forth in this Indenture with respect to offers to purchase, prepay or redeem such First Lien Debt with the proceeds of sales of assets to purchase, prepay or redeem the Notes having and such other First Lien Debt on a pro rata basis in an aggregate principal amount equal to the Excess Proceeds. The repurchase date in any Asset Sale Offer shall be specified by the Company, which date will be no earlier than 30 days and no later than 60 days from the date the notice of such Asset Sale Offer is delivered. The offer price in any Asset Sale Offer will be equal to 100% of the aggregate principal amount of the Notes, plus accrued and unpaid cash interest and Additional Amounts, if any, together with an amount of cash equal to all accrued and unpaid PIK Interest to:
, but not including, the date of purchase, subject to the rights of Holders of record on the relevant record date to receive interest due on the relevant Interest Payment Date, and will be payable in cash; provided that if the Asset Sale Offer is occurring as the result of an Asset Sale involving any of the ARO JV Related Assets or any of the Equity Interests held by the Valaris ARO Shareholder, then the applicable offer price will instead be equal to the sum of (i) accumulated Excess Proceeds, multiplied by
the lesser of (iiA) a fraction (x) 103% of the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (yB) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase applicable redemption price for the Notes will be 100% (expressed as percentages of principal amount) pursuant to Section 3.07 that the principal Company would have had to pay if it had elected to redeem Notes at such time, plus (ii) accrued and unpaid cash interest and Additional Amounts, if any, together with an amount plus of cash equal to all accrued interest and unpaid PIK Interest to, but excluding not including, the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining remain after consummation of an Asset Sale Offer (“Declined Excess Proceeds”), the Offer to Purchase Company and the Restricted Subsidiaries may be used use those Declined Excess Proceeds for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes or other First Lien Debt tendered in such Asset Sale Offer exceeds the amount of Excess Proceeds, the Company will select the Notes and other First Lien Debt for purchase on a pro rata basis unless otherwise required by law or applicable stock exchange or Depository requirements (with such adjustments as may be deemed appropriate by the Company so that only Notes and other First Lien Debt in denominations of $1.00 and integral multiples of $1.00 in excess thereof will be outstanding after such purchase). For the purposes of calculating the principal amount of any such Indebtedness not denominated in U.S. dollars, such Indebtedness shall be calculated by converting any such principal amounts into their Dollar Equivalent determined as of the Business Day immediately prior to the date on which the Asset Sale Offer is announced. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero.
(f) The Issuers Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such those requirements, laws and regulations are applicable in connection with the purchase each repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02the Asset Sale provisions of this Indenture, the Issuers Company shall comply with the applicable securities laws and regulations and shall will not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.10 by virtue of such conflictcompliance.
(g) The provisions of this Section 4.10 with respect to the Company’s obligation to make an Asset Sale Offer as a result of an Asset Sale may be waived or modified at any time with the written consent of the Holders of a majority in aggregate principal amount of the Notes then outstanding.
(h) Anything in this Indenture to the contrary notwithstanding, in no event shall (i) the Company or any Restricted Subsidiary sell, transfer or otherwise dispose of a Vessel to (x) an Unrestricted Subsidiary, other than the transfer of Other Vessels to the Unrestricted Floater Subsidiary as and to the extent permitted by this Indenture, or (y) an Excluded Subsidiary that is an Excluded Subsidiary pursuant to clause (a) of the definition thereof or (ii) any Restricted Subsidiary that is an Excluded Subsidiary pursuant to clause (a) of the definition thereof acquire a Vessel.
Appears in 1 contract
Limitation on Asset Sales. The Company shall not, and shall not cause or permit any Restricted Subsidiary Group Member to, directly or indirectly, make any Asset Sale Sale, unless the following conditions are met:
(ax) the Company or such Restricted Group Member, as the case may be, receives consideration at the time of such Asset Sale is for at least equal to the Fair Market Value; and
Value of the assets sold or otherwise disposed of and (by) at least 75% of the such consideration received by the Company or its Restricted Subsidiaries consists of (i) cash or Cash Equivalents, (ii) Replacement Assets, (iii) publicly traded Equity Interests of a Person; provided provided, however, that for purposes of this clause the Company or such Restricted Group Member shall sell (2a "Monetization Sale"), each of the following shall be considered for cash or Cash Equivalents:
, such Equity Interests to a third Person (other than to the Company or a Restricted Group Member) at a price not less than the Fair Market Value thereof within 425 days of the consummation of such Asset Sale, or (iv) any combination of the foregoing clauses (i) the assumption by the purchaser through (iii). The amount of Debt or other obligations or liabilities any (as shown on the Company’s most recent balance sheet or in the footnotes theretox) Indebtedness (other than any Subordinated Debt or other obligations or liabilities subordinated in right of payment to the NotesIndebtedness) of the Company or a any Restricted Subsidiary pursuant Group Member that is actually assumed by the transferee in such Asset Sale and from which the Company and the Restricted Group Members are fully released shall be deemed to operation be cash for purposes of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations determining the percentage of cash consideration received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted Group Member and (y) notes or other similar obligations received by the Company or any Restricted Group Member from such transferee that are converted, sold or exchanged within 365 days of the related Asset Sale by the Company or any Restricted Subsidiary Group Member into cash shall be deemed to cash or Cash Equivalentsbe cash, in an amount equal to the extent net cash proceeds realized upon such conversion, sale or exchange for purposes of determining the percentage of cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Group Member. Any Net Cash Proceeds from an any Asset Sale or any Monetization Sale that are not, within 425 days of the consummation of such Asset Sale or Monetization Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, invested in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) Replacement Assets or (B) used to repay and permanently reduce the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business commitments under Indebtedness of the Company or one any Restricted Group Member other than Subordinated Indebtedness or more Restricted Subsidiaries; Indebtedness of the Company (other than under the Senior Credit Facility) with a Weighted Average Life to Maturity or stated final maturity longer than that of the Securities shall constitute "Excess Proceeds" subject to disposition as provided that a binding commitment to below. Within 40 days after the aggregate amount of Excess Proceeds equals or exceeds $10.0 million, the Company shall make an acquisition referred Offer to in clause (ii) or (iii) above shall Purchase, from all Holders, that aggregate principal amount of Securities as can be treated as a permitted application purchased with the Security Portion of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof ) at a price in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is cash equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the outstanding principal amount thereof, plus accrued interest toand unpaid interest, but excluding if any, to any purchase date. To the date of purchase. If extent that the Offer to Purchase is for less than all aggregate of the outstanding Notes principal and Notes in an aggregate principal amount in excess accrued interest of the purchase amount are Securities validly tendered and not withdrawn pursuant to an Offer to Purchase is less than the offerExcess Proceeds, the Issuers shall purchase Notes having an Company may use such surplus for general corporate purposes. If the aggregate of the principal and accrued interest of Securities validly tendered and not withdrawn by Holders thereof exceeds the amount of Securities that can be purchased with the Security Portion of Excess Proceeds, Securities to be purchased will be selected pro rata based on the aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments of Securities tendered by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest)each Holder. Upon completion of the an Offer to Purchase, the amount of Excess Proceeds will shall be reset at to zero. In the event that any other Indebtedness of the Company that ranks pari passu with the Securities (the "Other Debt") requires an offer to purchase to be made to repurchase such Other Debt upon the consummation of an Asset Sale, and any the Company may apply the Excess Proceeds remaining after consummation of the Offer otherwise required to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant applied to an Offer to Purchase to offer to purchase such Other Debt and to an Offer to Purchase so long as the amount of such Excess Proceeds applied to purchase the Securities is not less than the Security Portion of Excess Proceeds. With respect to any Excess Proceeds, the Company shall make the Offer to Purchase in respect thereof at the same time as the analogous offer to purchase is made pursuant to this Section 4.09. To any Other Debt and the extent that Purchase Date in respect thereof shall be the provisions of same as the purchase date in respect thereof pursuant to any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflictOther Debt.
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall will not, and shall will not permit any Restricted Subsidiary of its Subsidiaries to, make consummate any Asset Sale unless (i) the Company or the applicable Subsidiary receives consideration at the time of such Asset Sale (the "Asset Sale Closing Date") at least equal to the Fair Market Value of the assets sold or otherwise disposed of or issued (as determined in good faith by the Board of Directors of the Company or, with respect to assets having a Fair Market Value in excess of $1 million, an Independent Financial Advisor) and at least 90% of the fair market value (as so determined) of the consideration so received by the Company or such Subsidiary is in the form of cash; provided, however, that the amount of (A) any liabilities of the Company or its Subsidiaries (other than liabilities owed to the Company, any of its Subsidiaries or any of their Affiliates) that are assumed by the transferee in any such transaction (as shown on the Company's or such Subsidiary's most recent balance sheet) pursuant to a customary novation agreement that releases the Company and its Subsidiaries from further liability and (B) any Cash Equivalents received by the Company or any Subsidiary from such transferee that are immediately converted by the Company or such Subsidiary into cash shall both be deemed to be cash, solely to the extent of the cash received in the case of (B), for purposes of this Section 4.18; and (ii) the Net Cash Proceeds received by the Company or such Subsidiary from such Asset Sale are applied in compliance with Section 4.18(b) hereof.
(i) If the Company or any of its Subsidiaries engages in an Asset Sale, the Company or such Subsidiary shall apply the Net Cash Proceeds thereof in the following conditions are metorder:
(aA) first, toward the Asset Sale is for at least Fair Market Valuepayment of the Indebtedness specified on Exhibit B; provided, however, that any such payment shall result in a permanent reduction in the maximum amount of Indebtedness permitted under Section 4.13(e)(i); and
(bB) second, toward the payment of the Indebtedness under the Senior Secured Credit Facility; provided, however, that any such payment shall result in a permanent reduction of the Lender's commitment thereunder and a corresponding permanent reduction in the maximum amount of Indebtedness permitted under Section 4.13(b)(i).
(ii) All Net Cash Proceeds not applied pursuant to Section 4.18(b)(i) ("Excess Proceeds") shall be delivered to the Trustee not later than 90 days after the applicable Asset Sale Closing Date, and shall be applied to the purchase of Senior Subordinated Notes pursuant to a Net Proceeds Purchase as set forth below. To the extent that any such Excess Proceeds remain after the application of the Net Cash Proceeds described in Section 4.18(b)(i), the Company shall purchase Senior Subordinated Notes as described in Section 4.18(c) (a "Net Proceeds Purchase") at least 75a price equal to 101% of the aggregate principal amount thereof, plus accrued interest to the date of purchase, which shall in the aggregate equal the amount of Excess Proceeds required by this Section 4.18 to be made available to purchase Senior Subordinated Notes in a Net Proceeds Purchase.
(c) Notice of a Net Proceeds Purchase pursuant to this Section 4.18 shall be mailed, by first class mail, by the Company not more than 91 days after the relevant Asset Sale Closing Date to all Holders at their last registered addresses, with a copy to the Trustee. The notice shall specify a Redemption Date chosen by the Company in compliance with the first sentence of Section 3.03 and shall contain all instructions and materials necessary to enable such Holders to tender Senior Subordinated Notes pursuant to the Net Proceeds Purchase and shall state the terms required to be stated in a notice of redemption under Section 3.03. On or before the Redemption Date, the Company shall have deposited with the Paying Agent (to the extent not already held by the Paying Agent) U.S. Legal Tender equal to the Excess Proceeds of the Asset Sale. Following the Redemption Date, the Paying Agent shall promptly mail to the Holders of Senior Subordinated Notes payment in an amount equal to the purchase price. The Company will publicly announce the results of the Net Proceeds Purchase on or as soon as practicable after the Redemption Date. For purposes of this Section 4.18, the Trustee shall act as the Paying Agent. Notwithstanding the foregoing, the Company need not initiate a purchase offer under this Section 4.18 if the amount on deposit with the Trustee is less than $1,000,000, but shall instead hold such lesser amount in trust in an interest bearing account until the earlier of the next Redemption Date under this Section or the date upon which the Senior Subordinated Notes become due and payable. The Company, however, may not credit any such amounts held by the Trustee against any other provision of this Indenture.
(d) If at any time any non-cash consideration received by the Company or its Restricted Subsidiaries consists any Subsidiary in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash, or if cash dividends or interest or other cash payments are received with respect thereto, then such cash shall constitute Net Cash Equivalents; provided that Proceeds for purposes of this clause (2), each of the following covenant and shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i4.18(b) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens as if received in an Asset Sale occurring on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase any such cash is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflictreceived.
Appears in 1 contract
Sources: Indenture (Trism Inc /De/)
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; and
equal to the fair market value of the assets sold or otherwise disposed of (bas determined in good faith by the Company's Board of Directors), (ii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash EquivalentsEquivalents and is received at the time of such disposition; provided provided, however, that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(iA) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes notes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a any Restricted Subsidiary pursuant to operation of law that are assumed by the transferee in such Asset Sale and from which the Company or a customary novation agreement,
such Restricted Subsidiary is released and (iiB) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, immediately converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents (to the extent of the cash or Cash Equivalents actually so received) shall be deemed to be cash for the purposes of this Section 4.15; and (iii) upon the consummation of an Asset Sale, and
the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either (ivA) to repay any Designated Non-Indebtedness ranking at least pari passu with the Notes (including amounts under Bank Credit Facilities), (B) to make an investment in properties and assets that replace the properties and assets that were the subject of such Asset Sale or in properties and assets that shall be used in the business of the Company and its Restricted Subsidiaries as existing on the Issue Date or in businesses reasonably related thereto ("Replacement Assets"), or (C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). On the 361st day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Consideration received Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each, a "Net Proceeds Offer Trigger Date"), an amount equal to such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each a "Net Proceeds Offer Amount") shall be applied by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred offer to in clause purchase (iithe "Net Proceeds Offer") or on a date (iiithe "Net Proceeds Offer Payment Date") above shall be treated as not less than 45 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, from all Holders on a permitted application pro rata basis, that amount of Notes equal to the Net Proceeds Offer Amount at a price equal to 100% of the Net Cash Proceeds from principal amount of the Notes to be purchased, plus accrued and unpaid interest thereon, if any, to the date of such commitmentpurchase; provided provided, however, that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) at any time any consideration other than cash or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, Equivalents received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds from thereof shall be applied in accordance with this covenant. A transfer of assets by the Company to a Wholly Owned Restricted Subsidiary or by a Restricted Subsidiary to the Company or to a Wholly Owned Restricted Subsidiary will not be deemed to be an Asset Sale for general corporate purposes (including a reduction Sale. A transaction that is subject to and made in borrowings under any revolving credit facility) prior compliance with Section 5.01 shall not be subject to the end of the 360-day period referred to in the first sentence application of this Section 4.09(c).
(d) When 4.15. The Company may defer the Net Proceeds Offer until there is an aggregate amount unutilized Net Proceeds Offer Amount equal to or in excess of Net Cash Proceeds $5,000,000 resulting from one or more Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)at which time, the Issuers mustentire unutilized Net Proceeds Offer Amount, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) and not just the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn $5,000,000, shall be applied as required pursuant to this paragraph). Notwithstanding the offerimmediately preceding paragraph, the Issuers Company and its Restricted Subsidiaries shall purchase Notes having be permitted to consummate an aggregate principal amount equal Asset Sale without complying with such paragraph to the purchase extent (i) at least 75% of the consideration for such Asset Sale constitutes Replacement Assets and (ii) such Asset Sale is for fair market value; provided that any consideration not constituting Replacement Assets received by the Company or any of its Restricted Subsidiaries in connection with any Asset Sale permitted to be consummated under this paragraph shall constitute Net Cash Proceeds subject to the provisions of the two preceding paragraphs. Each Net Proceeds Offer shall be mailed to the record Holders as shown on the register of Holders within 30 days following the Net Proceeds Offer Trigger Date, with a copy to the Trustee, and shall comply with the procedures set forth in this Indenture. Upon receiving notice of the Net Proceeds Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1,000 in exchange for cash. To the extent Holders properly tender Notes in an amount exceeding the Net Proceeds Offer Amount, Notes of tendering Holders shall be purchased on a pro rata basis to the extent practicable, with adjustments (based on amounts tendered) unless otherwise required by the Company so that only Notes in multiples law or any applicable exchange regulations. A Net Proceeds Offer shall remain open for a period of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (20 business days or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase such longer period as may be used for any purpose not otherwise prohibited required by this Indenturelaw. The Issuers Company shall comply with the requirements of 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 connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations or any applicable exchange regulations conflict with this Section 4.09 or Section 3.024.15, the Issuers Company shall comply with the applicable securities laws and regulations and exchange regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.15 by virtue of such conflictthereof.
Appears in 1 contract
Sources: Indenture (Penhall Co)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s Board of Directors);
(b2) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash EquivalentsEquivalents and shall be received at the time of such disposition; provided that that, for purposes of this clause (2)) any securities, each of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents (to the extent of the cash or Cash Equivalents actually so received, ) within 30 days after receipt will be considered “cash” or “Cash Equivalents”; and
(iv3) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 365 days of receipt thereof either:
(a) to permanently reduce Indebtedness under the Credit Agreement and, in the case of any Designated Non-such Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility;
(b) to make an investment in properties and assets that replace the properties and assets that were the subject of such Asset Sale or in properties and assets (including Capital Stock) that will be used in the business of the Company and its Restricted Subsidiaries as existing on the Issue Date or in businesses reasonably related thereto (“Replacement Assets”); or
(c) a combination of prepayment and investment permitted by the foregoing clauses (3)(a) and (3)(b).
(b) On the 366th day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Consideration received Proceeds relating to such Asset Sale as set forth in clauses (3)(a), (3)(b) and (3)(c) of Section 4.10(a) (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds that have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (3)(a), (3)(b) and (3)(c) of Section 4.10(a) or the last proviso of this paragraph (each, a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary in to make an offer to purchase (the Asset Sale having an aggregate Fair Market Value“Net Proceeds Offer”) to all Holders and, taken together with to the extent required by the terms of any Pari Passu Indebtedness, to all other Designated Non-Cash Consideration received pursuant to this clause holders of such Pari Passu Indebtedness, on a date (dthe “Net Proceeds Offer Payment Date”) not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, from all Holders (and holders of such Pari Passu Indebtedness) (and holders of any such Pari Passu Indebtedness) on a pro rata basis, the maximum amount of Notes and Pari Passu Indebtedness that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (may be purchased with the Fair Market Value of each item of Designated Non-Cash Consideration being measured Net Proceeds Offer Amount at the time received and without giving effect a price equal to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case 100% of the repayment principal amount of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (Pari Passu Indebtedness to be purchased, plus accrued and unpaid interest thereon, if any) through making the Offer , to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitmentpurchase; provided provided, however, that (x) such investment is consummated within 180 days of the end of the 360if at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.10. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from one or more Asset Sales (at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in excess of $10.0 million, shall be applied as required pursuant to this Section 4.10(b)). In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01, which transaction does not constitute a Change of Control, the successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.10 and shall comply with the provisions of this Section 4.10 with respect to such deemed sale as if it were an Asset Sale. In addition, the fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this Section 4.10.
(c) Notwithstanding Sections 4.10(a) and (b), the Company and its Restricted Subsidiaries will be permitted to consummate an Asset Sale without complying with such Sections to the extent that:
(1) at least 75% of the consideration for general corporate purposes such Asset Sale constitutes Replacement Assets; and
(2) such Asset Sale is for fair market value; provided that any consideration not constituting Replacement Assets received by the Company or any of its Restricted Subsidiaries in connection with any Asset Sale permitted to be consummated under this Section 4.10(c) shall constitute Net Cash Proceeds subject to the provisions of Sections 4.10(a) and (b). The provisions of this Section 4.10 shall not apply to transactions undertaken pursuant to an Inversion Transaction; provided that (i) the Supplemental Indenture is executed and in effect concurrently with the consummation of such Inversion Transaction; (ii) immediately following such Inversion Transaction, the Company shall apply to S&P and ▇▇▇▇▇’▇ to have its debt rating and outlook updated and such updated debt rating and outlook shall be no less favorable to the Company than immediately prior to such Inversion Transaction; (iii) immediately following such Inversion Transaction, the Company’s Consolidated Fixed Charge Coverage Ratio is at least equal to the Consolidated Fixed Charge Coverage Ratio immediately prior to such Inversion Transaction; and (iv) immediately following such Inversion Transaction, the Company is able to incur at least $1.00 of additional Indebtedness (other than Permitted Indebtedness) in compliance with Section 4.03. Each Net Proceeds Offer will be mailed to the record Holders as shown on the register of Holders within 25 days following the Net Proceeds Offer Trigger Date, with a copy to the Trustee, and shall comply with the procedures set forth in this Indenture. The notice to the Holders shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Net Proceeds Offer. Such notice shall state:
(1) that the Net Proceeds Offer is being made pursuant to this Section 4.10 and that (subject to the provisions hereof) all Notes tendered will be accepted for payment;
(2) the purchase price (including the amount of accrued interest) and the purchase date (which shall be the Net Proceeds Offer Payment Date);
(3) that any Note not tendered will continue to accrue interest if interest is then accruing;
(4) that, unless the Company defaults in making payment therefor, any Note accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(5) that Holders electing to have a reduction Note purchased pursuant to a Net Proceeds Offer will be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, to the Paying Agent at the address specified in borrowings under any revolving credit facility) the notice prior to the end close of business on the third business day prior to the Net Proceeds Offer Payment Date;
(6) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than 5:00 p.m., New York City time, on the second Business Day preceding the Net Proceeds Offer Date, a facsimile transmission or letter setting forth the name of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)Holder, the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased; and
(y7) the denominator of which is equal to the outstanding aggregate principal amount circumstances and relevant facts regarding such Net Proceeds Offer. Upon receiving notice of the Net Proceeds Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1000 in exchange for cash. To the extent Holders properly tender Notes and all Debt secured by Liens on holders of Pari Passu Indebtedness properly tender such Pari Passu Indebtedness in an amount exceeding the Collateral ranking pari passu with Net Proceeds Offer Amount, the Liens on the Collateral securing the tendered Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes and Pari Passu Indebredness will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount purchased on a pro rata basis (based on amounts tendered) in an aggregate amount equal to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount Net Proceeds Offer Amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interestany). Upon completion A Net Proceeds Offer shall remain open for a period of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase 20 business days or such longer period as may be used for any purpose not otherwise prohibited required by this Indenturelaw. The Issuers Company shall comply with the requirements of 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 connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.this
Appears in 1 contract
Sources: Indenture (Manitowoc Co Inc)
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company's senior management or, in the case of an Asset Sale in excess of $5.0 million, the Board of Directors of the Company);
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of (x) cash or Cash Equivalents, (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business or (z) Capital Stock in one or more Persons engaged in a Permitted Business that are or thereby become Restricted Subsidiaries of the Company, and, in each case, such consideration is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Securities) that are assumed by the transferee of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations securities received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 180 days after such Asset Sale (to the extent of the cash or Cash Equivalents actually so received, ) shall be deemed to be cash for the purposes of this provision only; and
(iviii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either:
(A) to prepay any Designated Non-Applicable Indebtedness and, in the case of any such Applicable Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility (or effect a permanent reduction in availability under such revolving credit facility, regardless of the fact that no prepayment is required);
(B) to make an Investment (x) in properties and assets that replace the properties and assets that were the subject of such Asset Sale, (y) in properties and assets that will be used in a Permitted Business or (z) permitted by clause (1) 69 of the definition of Permitted Investments (collectively, "Replacement Assets"); or
(C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Pending the final application of the Net Cash Consideration received Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Pari Passu Indebtedness (or, in the case of an Asset Sale by a Restricted Subsidiary, Indebtedness of a Restricted Subsidiary) or otherwise invest such Net Cash Proceeds in any manner not prohibited by this Indenture. On the 361st day after an Asset Sale or such earlier date, if any, as the senior management or the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each, a "Net Proceeds Offer Trigger Date"), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each a "Net Proceeds Offer Amount") shall be applied by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred offer to in clause purchase (iithe "Net Proceeds Offer") or on a date (iiithe "Net Proceeds Offer Payment Date") above shall be treated as not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, from all Holders on a permitted application pro rata basis, that amount of Securities equal to the Net Proceeds Offer Amount at a price equal to 100% of the Net Cash Proceeds from principal amount of the Securities to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, that if the Company so elects (or is required by the terms of any Applicable Pari Passu Indebtedness), such commitment; provided that (x) Net Proceeds Offer may be made ratably to purchase the Securities and such investment is consummated within 180 days of the end of the 360Applicable Pari Passu Indebtedness. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this covenant. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from an one or more Asset Sale for general corporate purposes Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $10.0 million, shall be applied as required pursuant to the end preceding paragraph). In the event of the 360-day period referred transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the first sentence successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section, and shall comply with the provisions of clause (iii) of this Section 4.09(c).
(d) When with respect to such deemed sale as if it were an Asset Sale. In addition, the aggregate amount fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from Asset Sales not applied for purposes of this Section 4.18. Notice of each Net Proceeds Offer pursuant to (this Section 4.18 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and within materials necessary to enable such Holders to tender Securities pursuant to the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), Net Proceeds Offer and shall state the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal tofollowing terms:
(i) accumulated Excess Proceedsthat Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to prorationing as hereinafter described in the event the Net Proceeds Offer is oversubscribed) in integral multiples of $1,000 of principal amount, multiplied byat the applicable purchase price;
(ii) that the Net Proceeds Offer is being made pursuant to this Section 4.18 and that all Securities tendered will be accepted for payment; provided, however, that if the principal amount of Securities tendered in the Net Proceeds Offer exceeds the aggregate amount of the Net Proceeds Offer Amount, the Company shall select the Securities to be purchased on a fraction pro rata basis (xbased on amounts tendered);
(iii) the numerator purchase price (including the amount of accrued interest, if any) and the purchase date (which is equal shall be no earlier than 30 days nor later than 60 days from the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(iv) that any Security not tendered will continue to accrue interest;
(v) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the outstanding aggregate Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(vi) that Holders electing to have a Security purchased pursuant to the Net Proceeds Offer will be required to surrender the Security, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Offer Payment Date;
(vii) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes Security the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; and
(yviii) the denominator of which is that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender in immediately available funds sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers' Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so to the Holder thereof. For purposes of this Section 4.18, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that only Notes in multiples of $1,000 principal amount (and in a minimum the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect the Securities tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.18, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.18 by virtue thereof. This covenant and other provisions contained in this Indenture relating to the Company's obligation to make a Net Proceeds Offer may be waived or modified with the written consent of such conflictthe Holders of a majority in principal amount of the Securities.
Appears in 1 contract
Sources: Indenture (RPP Capital Corp)
Limitation on Asset Sales. The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
unless: (a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; and
equal to the fair market value of the assets sold or otherwise disposed of (bas determined in good faith by the Company’s Board of Directors), (2) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash Equivalents; Equivalents and is received at the time of such disposition provided that for purposes of this clause provision, the amount of (2), each of the following shall be considered cash or Cash Equivalents:
(iA) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s most recent balance sheet of the Company or such Restricted Subsidiary or in the footnotes notes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a such Restricted Subsidiary pursuant that are assumed by the transferee of any such assets (other than liabilities that are by their terms pari passu with or subordinated to operation the Notes or the guarantee of law or a customary novation agreement,
the Guarantors, as applicable) and (iiB) Additional Assets,
(iii) instruments, notes, any securities or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, immediately converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents (or (i) are Marketable Securities that are actually sold for cash or Cash Equivalents within 180 days of the consummation of such Asset Sale or (ii) as to which the Company or such Restricted Subsidiary has received at or prior to the consummation of the Asset Sale a commitment (which may be subject to customary conditions) from a nationally recognized investment, merchant or commercial bank to convert into cash or Cash Equivalents within 180 days of the consummation of such Asset Sale and which are thereafter actually converted into cash or Cash Equivalents within such 180-day period) will be deemed to be cash or Cash Equivalents (and shall be deemed to be Net Cash Proceeds for purposes of the following provisions as and when reduced to cash or Cash Equivalents, ) to the extent of the net cash or Cash Equivalents actually so receivedrealized thereon, and (3) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 365 days of receipt thereof either: (A) to repay or prepay any Senior Debt and
, in the case of any Senior Debt under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility, (ivB) any Designated Non-to make an investment (or shall have entered into a binding commitment to make such an investment within 180 days) in properties and assets that replace the properties and assets that were the subject of such Asset Sale or in properties and assets that will be used in the business of the Company and its Subsidiaries as existing on the Issue Date or in businesses which are the same, similar or reasonably related or complementary to the businesses in which the Company and its Restricted Subsidiaries are engaged on the Issue Date (“Replacement Assets”), or (C) a combination of prepayment and investment permitted by the foregoing clauses (3)(A) and (3)(B). On the 366th day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Consideration received Proceeds relating to such Asset Sale as set forth in clauses (3)(A), (3)(B) and (3)(C) of the next preceding sentence (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied (or committed to the purchase of replacement assets) on or before such Net Proceeds Offer Trigger Date as permitted in clauses (3)(A), (3)(B) and (3)(C) of the next preceding sentence (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred offer to in clause purchase (iithe “Net Proceeds Offer”) or on a date (iiithe “Net Proceeds Offer Payment Date”) above shall be treated as not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, from all Holders on a permitted application pro rata basis, that amount of Notes equal to the Net Proceeds Offer Amount at a price equal to 100% of the Net Cash Proceeds from principal amount of the Notes to be purchased, plus accrued and unpaid interest thereon, if any, to the date of such commitmentpurchase; provided provided, however, that (x) such investment is consummated within 180 days of the end of the 360if at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.16. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from one or more Asset Sales (at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in excess of $10.0 million, shall be applied as required pursuant to this paragraph). In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01, the successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.16, and shall comply with the provisions of this Section 4.16 with respect to such deemed sale as if it were an Asset Sale. In addition, the fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this Section 4.16.
(1) Notwithstanding the two immediately preceding paragraphs, the Company and its Restricted Subsidiaries will be permitted to consummate an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior without complying with such paragraphs to the end of extent (A) the 360-day period referred to in the first sentence of this Section 4.09(c)consideration for such Asset Sale constitutes Replacement Assets and (B) such Asset Sale is for fair market value.
(d2) When Each notice of a Net Proceeds Offer pursuant to this Section 4.16 shall be mailed or caused to be mailed, by first class mail, by the Company not more than 25 days after the Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. The notice shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Net Proceeds Offer and shall state the following terms:
(A) that the Net Proceeds Offer is being made pursuant to this Section 4.16, that all Notes tendered will be accepted for payment; provided, however, that if the aggregate principal amount of Notes tendered in a Net Proceeds Offer plus accrued interest at the expiration of such offer exceeds the aggregate amount of the Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)Offer, the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of Company shall select the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount purchased on a pro rata basis to the extent practicable, (with such adjustments as may be deemed appropriate by the Company so that only Notes in multiples denominations of $1,000 or multiples thereof shall be purchased) and that the Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law;
(B) the purchase price (including the amount of accrued interest) and the Net Proceeds Offer Payment Date (which shall be not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date and which shall be at least three Business Days after the Trustee receives notice thereof from the Company unless a shorter period shall be agreed to by the Trustee);
(C) that any Note not tendered will continue to accrue interest;
(D) that, unless the Company defaults in making payment therefor, any Note accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(E) that Holders electing to have a Note purchased pursuant to a Net Proceeds Offer will be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day prior to the Net Proceeds Offer Payment Date;
(F) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes the Holder delivered for purchase and a statement that such Holder is withdrawing its election to have such Note purchased; and
(and G) that Holders whose Notes are purchased only in part will be issued new Notes in a minimum principal amount equal to the unpurchased portion of the Notes surrendered; provided, however, that each Note purchased and each new Note issued shall be in an original principal amount of $1,0001,000 or integral multiples thereof. On or before the Net Proceeds Offer Payment Date, the Company shall (1) will accept for payment Notes or portions thereof tendered pursuant to the Net Proceeds Offer which are to be purchased in accordance with item (2)(B) of this Section 4.16, (2) deposit with the Paying Agent in accordance with Section 2.14 U.S. Legal Tender sufficient to pay the purchase price plus accrued interest, if any, of all Notes to be purchased and (3) deliver to the Trustee Notes so accepted together with an Officers’ Certificate stating the Notes or portions thereof being purchased by the Company. The Paying Agent shall promptly mail to the Holders of Notes so accepted payment in an amount equal to the purchase price plus accrued interest, if any. For purposes of this Section 4.16, the Trustee shall act as the Paying Agent. The Trustee shall promptly authenticate and mail to such Holders new Notes equal in principal amount to any unpurchased portion of the Notes surrendered. Upon the payment of the purchase price for the Notes accepted for purchase, the Trustee shall either cancel the Notes or return the Notes purchased to the Company for cancellation. Any monies remaining after the purchase of Notes pursuant to a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof Net Proceeds Offer shall be returned within three Business Days by the Trustee to the Company except with respect to a PIK Note or monies owed as obligations to the Trustee pursuant to Article Seven. For purposes of this Section 4.16, the Trustee shall act as the Paying Agent. To the extent the amount of Notes tendered pursuant to any Net Proceeds Offer is less than the amount of Net Cash Proceeds subject to such Net Proceeds Offer, the Company may use any remaining portion of a Global Note constituting PIK Interest). Upon completion such Net Cash Proceeds not required to fund the repurchase of the tendered Notes for general corporate purposes and such Net Proceeds Offer to Purchase, Excess Proceeds will Amount shall be reset at to zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.16, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under the provisions of this Section 4.09 or Section 3.02 Indenture by virtue of such conflictthereof.
Appears in 1 contract
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Valueequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company's Board of Directors); and
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash Equivalents; Equivalents (provided that for purposes the -------- amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet sheet) of the Com- pany or in the footnotes thereto) any such Restricted Subsidiary (other than Subordinated Debt or other obligations or liabilities that are by their terms subordinated in right of payment to the Notes) that are assumed by the transferee of any such assets shall be deemed to be cash for the purposes of this provision) and is received at the time of such disposition; and (iii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either (A) to prepay any Senior Debt and, in the case of any Senior Debt under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility, (B) to make an investment in properties and assets that replace the properties and assets that were the subject of such Asset Sale or in properties and assets that will be used in the business of the Company and its Restricted Subsidiaries as existing on the Issue Date or in businesses the same, simi- lar or reasonably related thereto ("Replacement Assets"), or (C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Subject to the last sentence of this paragraph, on the 361st day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from determines not to apply the purchaser that are promptlyNet Cash Proceeds relating to such Asset Sale as set forth in clause (iii)(A), but in any event within 90 days (iii)(B) or (iii)(C) of the closingnext pre- ceding sentence (each, converted a "Net Proceeds Offer Trigger Date"), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each a "Net Proceeds Offer Amount") shall be applied by the Company or such Restricted Subsidiary to cash or Cash Equivalentsmake an offer to purchase (the "Net Proceeds Offer") on a date (the "Net Proceeds Offer Payment Date") not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, from all Holders on a pro rata basis, that amount of Notes equal to the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Notes to be purchased, plus accrued and unpaid interest thereon, if any, to the extent date of the purchase; provided, however, that if at any time -------- ------- any non-cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof shall be applied in accordance with this covenant. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $5.0 million resulting from one or more Asset Sales (at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in excess of $5.0 million, shall be applied as required pursuant to this paragraph). In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a trans- action permitted under Section 5.01, the successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this covenant, and shall comply with the provisions of this covenant with respect to such deemed sale as if it were an Asset Sale Sale. In addition, the fair market value of such properties and assets of the Company or its Restricted Subsid- iaries deemed to be sold shall be deemed to be Net Cash Pro- ceeds for purposes of this Section 4.16 the extent that the aggregate amount of Notes tendered pursuant to a Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any other purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions Upon completion of any securities laws or regulations conflict with Section 4.09 or Section 3.02such Net Proceeds Offer, the Issuers Net Proceeds Offer Amount shall comply with the applicable securities laws and regulations and be reset at zero. A Net Proceeds Offer shall not remain open for a period of 20 business days or such longer period as may be deemed to have breached their obligations under this Section 4.09 or Section 3.02 required by virtue of such conflictlaw.
Appears in 1 contract
Limitation on Asset Sales. The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary receives consideration at the time of such Asset Sale is for at least Fair Market Valueequal to the fair market value of the assets that are sold or otherwise disposed of, as reasonably determined in good faith by the Company’s Board of Directors or a senior officer of the Company; and
(b2) at least 75% of the consideration received by the Company or its the applicable Restricted Subsidiaries consists Subsidiary from the Asset Sale is in the form of cash or Cash Equivalents; provided that for purposes in the case of the sale of all of the IMC Salt Business Unit and ▇▇▇▇▇, in the alternative, up to 35% of the consideration received by the Company or the applicable Restricted Subsidiary in the sale may be in the form of Capital Stock of the Person that will hold the IMC Salt Business Unit and ▇▇▇▇▇ following the Asset Sale if the remainder is in the form of cash or Cash Equivalents; provided, further, that the requirement in this clause (2), each ) shall not apply in the case of the following shall sale of all or any part of the IMC Chemicals Business Unit. For the purposes of clause (2) above, the amount of any Indebtedness shown on the most recent applicable balance sheet of the Company or the applicable Restricted Subsidiary, other than Indebtedness that is by its terms subordinated to the Notes or any Note Guarantee, that is assumed by the transferee of any such assets will be considered cash deemed to be cash. Additionally, the Company or such Restricted Subsidiary, as the case may be, must apply the Net Cash EquivalentsProceeds from each Asset Sale to:
(i1) repay Indebtedness under the assumption Credit Agreement;
(2) repay (including by purchase) secured obligations;
(3) repay (including by purchase) any Indebtedness of any Restricted Subsidiary that is not a Guarantor; and/or
(4) make an investment in or expenditures for assets (including Capital Stock of any entity) (a) that replace the purchaser assets that were the subject of Debt the Asset Sale or other obligations or liabilities (b) that will be used in the business of the Company and its Subsidiaries as shown existing on the Company’s most recent balance sheet Issue Date or in businesses reasonably related thereto (“Replacement Assets”). Any Net Cash Proceeds that the footnotes theretoCompany does not apply, or decides not to apply, in accordance with the preceding paragraph will constitute a “Net Proceeds Offer Amount.” The 366th day after an Asset Sale or any earlier date on which the Board of Directors of the Company determines not to apply the Net Cash Proceeds in accordance with the preceding paragraph is a “Net Proceeds Offer Trigger Date.” When the aggregate Net Proceeds Offer Amount is equal to or exceeds $25.0 million, the Company must make an offer to purchase (the “Net Proceeds Offer”) on a date that is not less than 30 days nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, from
(a) all Holders of Notes and
(b) all holders of other than Subordinated Debt or other obligations or liabilities Indebtedness (“Other Indebtedness”) that (x) is not, by its terms, expressly subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year Notes and (y) $30.0 million in the aggregate since the Issue Date (contains provisions requiring that an offer to purchase such Other Indebtedness be made with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at proceeds from the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, on a pro rata basis, the maximum principal amount of Notes and Other Indebtedness that may be purchased with the Net Cash Proceeds may Offer Amount. The offer price for Notes in any Net Proceeds Offer will be used:
(i) equal to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case 100% of the repayment principal amount of the revolving credit facility under the Credit AgreementNotes to be purchased, plus any accrued and unpaid interest on such Notes, if any, to permanently reduce the commitment thereunder by such amount) or (B) the Notes date of purchase. The following events will be deemed to constitute an Asset Sale and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so Asset Sale must be applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, 4.10:
(1) in the event any non-cash consideration received by the Company or any Restricted Subsidiary may use of the Company in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), or
(2) in the event of the transfer of substantially all, but not all, of the assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01, and as a result thereof the Company is no longer an obligor on the Notes, the successor corporation shall be deemed to have sold the assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.10, and shall comply with the provisions of this Section 4.10 with respect to such deemed sale as if it were an Asset Sale. In addition, the fair market value of such assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from for purposes of this Section 4.10. Notwithstanding the provisions described in the immediately preceding paragraphs, the Company and its Restricted Subsidiaries may consummate an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior without complying with such provisions to the end extent that (a) at least 75% of the 360-day period referred consideration for such Asset Sale constitutes Replacement Assets and (b) such Asset Sale is for fair market value. Any cash consideration that does not constitute Replacement Assets that is received by the Company or any of its Restricted Subsidiaries in connection with any Asset Sale permitted under this paragraph will constitute Net Cash Proceeds and will be subject to the provisions described in the first sentence preceding paragraphs. The Company shall mail a notice of a Net Proceeds Offer by first-class mail, postage prepaid, to the record Holders as shown on the register of Holders within 30 days following the Net Proceeds Offer Trigger Date, with a copy to the Trustee, containing all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Net Proceeds Offer and shall state the following terms:
(1) that the Net Proceeds Offer is being made pursuant to this Section 4.09(c).
(d) When 4.10, that all Notes tendered will be accepted for payment; provided, however, that if the aggregate principal amount of Notes and Other Indebtedness tendered in a Net Proceeds Offer plus accrued interest at the expiration of such offer exceeds the aggregate amount of the Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)Offer, the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers Company shall purchase Notes having an aggregate principal amount equal to the purchase amount select on a pro rata basis basis, the Notes and Other Indebtedness to the extent practicable, be purchased (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of $1,000, as applicable, or multiples thereof shall be purchased) and that the Net Proceeds Offer shall remain open for a period of 20 business days or such longer periods as may be required by law;
(2) the offer price (including the amount of accrued interest) and the Net Proceeds Offer date of payment (“Net Proceeds Offer Payment Date”) (which shall be not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date and which shall be at least five business days after the Trustee receives notice thereof from the Company);
(3) that any Note not tendered will continue to accrue interest;
(4) that, unless the Company defaults in making payment therefor, any Note accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(5) that Holders electing to have a Note purchased pursuant to a Net Proceeds Offer will be required to surrender such Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the business day prior to the Net Proceeds Offer Payment Date;
(6) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second business day prior to the Net Proceeds Offer Payment Date, a telegram, telex, facsimile transmission or letter setting forth the name of such Holder, the principal amount of the Notes such ▇▇▇▇▇▇ delivered for purchase and a statement that such ▇▇▇▇▇▇ is withdrawing his election to have such Note purchased; and
(7) that Holders whose Notes are purchased only in part will be issued new Notes in a principal amount equal to the unpurchased portion of the Note surrendered; provided, however, that each Note purchased and each new Note issued shall be in an original principal amount of $1,000 principal amount or integral multiples thereof. On or before the Net Proceeds Offer Payment Date, the Company shall
(and a) accept for payment Notes or portions thereof (in a minimum amount integral multiples of $1,000) will validly tendered pursuant to the Net Proceeds Offer, (b) deposit with the Paying Agent in accordance with Section 2.15 U.S. Dollars sufficient to pay the purchase price plus accrued and unpaid interest, if any, of all Notes to be purchased and (c) deliver to the Trustee Notes so accepted together with an Officers’ Certificate stating the Notes or portions thereof being purchased by the Company. Upon receipt by the Paying Agent of the monies specified in clause (b) above and a copy of the Officers’ Certificate specified in clause (c) above, the Paying Agent shall promptly mail to the Holders of Notes so accepted payment in an amount equal to the purchase price plus accrued and unpaid interest, if any, out of the funds deposited with the Paying Agent in accordance with the preceding sentence. The Trustee shall promptly authenticate and mail to such Holders new Notes equal in principal amount to any unpurchased portion of the Notes surrendered. Upon the payment of the purchase price for the Notes accepted for purchase, the Trustee shall return the Notes purchased to the Company for cancellation. Any monies remaining after the purchase of Notes pursuant to a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof Net Proceeds Offer shall be returned within three business days by the Trustee to the Company except with respect to a PIK Note or monies owed as obligations to the Trustee pursuant to Article Seven. For purposes of this Section 4.10, the Trustee shall act as the Paying Agent. To the extent the amount of Notes tendered pursuant to any Net Proceeds Offer is less than the amount of Net Cash Proceeds subject to such Net Proceeds Offer, the Company may use any remaining portion of a Global Note constituting PIK Interest). Upon completion such Net Cash Proceeds not required to fund the repurchase of the tendered Notes for general corporate purposes and such Net Proceeds Offer to Purchase, Excess Proceeds will Amount shall be reset at to zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.10, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under the provisions of this Section 4.09 or Section 3.02 4.10 by virtue of such conflictthereof.
Appears in 1 contract
Sources: Supplemental Indenture
Limitation on Asset Sales. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of such Asset Sale is for at least Fair Market Valueequal to the fair market value of the assets or Equity Interests issued or sold or otherwise disposed of, as approved in good faith by the Company’s Board of Directors; and
(b2) at least 75% of the consideration therefor received by the Company or its such Restricted Subsidiaries consists Subsidiary is in the form of cash or Cash Equivalents; provided that for . For purposes of this clause provision only (2and specifically not for the purposes of the definition of “Net Proceeds”), each of the following shall be considered cash or Cash Equivalentsdeemed to be cash:
(i) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than contingent liabilities and liabilities that are by their terms subordinated to operation the Notes or any Subsidiary Guarantee) that are assumed by the transferee of law or a customary novation agreement,any such assets; and
(ii) Additional Assets,
(iii) instrumentsany securities, notes, securities notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that within 180 days are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received, received in that conversion); and
(iviii) the fair market value of (x) any Designated Non-Cash Consideration assets (other than securities or current assets) received by the Company or such any Restricted Subsidiary that will be used or useful in the Asset Sale having an aggregate Fair Market Valuea Related Business, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (dy) Equity Interests in a Person that is at a Restricted Subsidiary or in a Person engaged in a Related Business that time outstanding, not to exceed shall become a Restricted Subsidiary immediately upon the acquisition of such Equity Interests by the Company or the applicable Restricted Subsidiary or (z) a combination of (x) $10.0 million per fiscal year and (y); provided that the determination of the fair market value of assets or Equity Interests in excess of $75.0 million received in any transaction or series of related transactions shall be evidenced by an Officers’ Certificate delivered to the Trustee.
(b) $30.0 million in the aggregate since Within a period of 450 days (commencing after the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(cDate) Within 360 days before or after the receipt of any Net Cash Proceeds of any Asset Sale (provided that if during such 450-day period after the receipt of any such Net Proceeds the Company (or the applicable Restricted Subsidiary) enters into a definitive binding agreement committing it to apply such Net Proceeds in accordance with the requirements of clause (B), (D) or (E) of this paragraph after such 450th day, such 450-day period will be extended with respect to the amount of Net Proceeds so committed for a period not to exceed 180 days until such Net Proceeds are required to be applied in accordance with such agreement (or, if earlier, until termination of such agreement)), the Company or such Restricted Subsidiary, at its option, may apply an amount equal to the Net Proceeds from an such Asset Sale, the Net Cash Proceeds may be used:
(iA) to permanently repay repay, prepay, redeem or repurchase Indebtedness (Aother than securities) Debt outstanding under Credit Facilities or Indebtedness of a Restricted Subsidiary that is not a Guarantor (other than Indebtedness of such Restricted Subsidiary owed to the Credit Agreement (Company or any of its Restricted Subsidiaries) and, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the repayment of the availability under such revolving credit facility (or effect a permanent reduction in the availability under such revolving credit facility regardless of the Credit Agreement, fact that no prepayment is required in order to permanently reduce the commitment thereunder by such amount) or do so (in which case no prepayment shall be required));
(B) to acquire Equity Interests in a Person that is a Restricted Subsidiary or in a Person engaged in a Related Business that shall become a Restricted Subsidiary immediately upon the Notes and any Debt secured acquisition of such Equity Interests by Liens ranking pari passu with the Liens securing Company or the Notes (if any) through making the Offer to Purchase below,applicable Restricted Subsidiary;
(iiC) to make capital expenditures;
(D) to acquire Additional Assetsother assets (other than securities or current assets) that will be used or useful in a Related Business;
(E) to make Investments in Joint Ventures pursuant to clauses (13) and (14) of the definition of “Permitted Investments”; or
(iiiF) to make capital expenditures in a Permitted Business combination of prepayment and investment permitted by the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause foregoing clauses (iiA), (B), (C), (D) or and (iiiE).
(c) above shall be treated as a permitted Pending the final application of the such Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09Proceeds, the Company or any Restricted Subsidiary may use temporarily reduce borrowings under the Credit Facilities or any other revolving credit facility or Receivables Financings, if any, or otherwise invest such Net Proceeds in Cash Proceeds from Equivalents, in each case in a manner not prohibited by this Indenture. Subject to the last sentence of this paragraph, on the 451st day (as extended pursuant to the provisions in Section 4.10(b)) after an Asset Sale for general corporate purposes or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Proceeds relating to such Asset Sale as set forth in clause (A), (B), (C), (D), (E) or (F) of Section 4.10(b) (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Proceeds which have not been applied (or committed to be applied pursuant to a definitive agreement as described in Section 4.10(b)) on or before such Net Proceeds Offer Trigger Date as permitted in clause (A), (B), (C), (D), (E) or (F) of Section 4.10(b) (each a “Net Proceeds Offer Amount”) shall be applied by the Com- pany or such Restricted Subsidiary to make an offer to purchase (the “Net Proceeds Offer”) on the Purchase Date, from all Holders (and, if required by the terms of any other Indebtedness of the Company ranking pari passu with the Notes in right of payment and which has similar provisions requiring the Company either to make an offer to repurchase or to otherwise repurchase, redeem or repay such Indebtedness with the proceeds from Asset Sales, including the 2020 Notes and the related Guarantees thereof (the “Pari Passu Indebtedness”), from the holders of such Pari Passu Indebtedness) on a reduction pro rata basis (in borrowings under any revolving credit facility) prior proportion to the end respective principal amounts or accreted value, as the case may be, of the 360Notes and any such Pari Passu Indebtedness) an aggregate principal amount of Notes (plus, if applicable, an aggregate principal amount or accreted value, as the case may be, of Pari Passu Indebtedness) equal to the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Notes (or 100% of the principal amount or accreted value, as the case may be, of such Pari Passu Indebtedness), plus accrued and unpaid interest thereon, if any, to the Purchase Date; provided, however, that if at any time any non-day period referred cash consideration received by the Company or any Restricted Subsidiary, as the case may be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Proceeds thereof shall be applied in accordance with this covenant. The Company may defer the first sentence Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $100.0 million resulting from one or more Asset Sales (at which time the entire unutilized Net Proceeds Offer Amount, and not just the amount in excess of $100.0 million, shall be applied as required pursuant to this Section 4.09(cparagraph, and in which case the Net Proceeds Offer Trigger Date shall be deemed to be the earliest date that the Net Proceeds Offer Amount is equal to or in excess of $100.0 million).
(d) When To the extent that the aggregate principal amount of Net Cash Proceeds from Asset Sales not applied Notes (plus, if applicable, the aggregate principal amount or accreted value, as the case may be, of Pari Passu Indebtedness) validly tendered pursuant to (a Net Proceeds Offer by the Holders thereof and within not withdrawn exceeds the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02Net Proceeds Offer Amount, Notes having of tendering Holders (and, if applicable Pari Passu Indebtedness tendered by the holders thereof) will be purchased on a principal amount equal to:
pro rata basis (i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) based on the numerator of which is equal to the outstanding aggregate principal amount of the Notes and, if applicable, the principal amount or accreted value, as the case may be, of any such Pari Passu Indebtedness tendered and (y) not withdrawn). To the denominator of which is equal to extent that the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on (plus, if applicable, the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess or accreted value, as the case may be, of the purchase amount are any Pari Passu Indebtedness) tendered and not withdrawn pursuant to a Net Proceeds Offer is less than the offerNet Proceeds Offer Amount, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (may use such excess Net Proceeds Offer Amount for general corporate purposes or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any other purpose not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law.
(e) The Issuers shall Company or the applicable Restricted Subsidiary, as the case may be, will comply with the requirements of 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 connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 4.10 or Section 3.023.09, the Issuers Company or such Restricted Subsidiary shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 Indenture by virtue of such conflictthereof.
Appears in 1 contract
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s senior management or, in the case of an Asset Sale in excess of $5.0 million, the Board of Directors of the Company);
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of (x) cash or Cash Equivalents, (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business or (z) Capital Stock in one or more Persons engaged in a Permitted Business that are or thereby become Restricted Subsidiaries of the Company, and, in each case, such consideration is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Securities) that are assumed by the transferee of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations securities received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 180 days after such Asset Sale (to the extent of the cash or Cash Equivalents actually so received, received in the conversion) shall be deemed to be cash for the purposes of this provision only; and
(iviii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either:
(A) to permanently reduce any Designated Non-Indebtedness that is secured by a Lien permitted under this Indenture, including Indebtedness under the Credit Agreement, or any Indebtedness of a Restricted Subsidiary that is not a Guarantor and, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility (or effect a permanent reduction in the availability under such revolving credit facility regardless of the fact that no prepayment is required);
(B) to make an investment (x) in properties and assets that replace the properties and assets that were the subject of such Asset Sale, (y) in properties and assets that will be used by the Company or a Restricted Subsidiary in a Permitted Business or (z) permitted by clause (1) of the definition of Permitted Investments (collectively, “Replacement Assets”); or
(C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Pending the final application of the Net Cash Consideration received Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Indebtedness or otherwise invest such Net Cash Proceeds in any manner not prohibited by this Indenture. On the 361st day after an Asset Sale or such earlier date, if any, as the senior management or the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary in to make an offer to purchase (the Asset Sale having an aggregate Fair Market Value“Net Proceeds Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, taken together with from all other Designated Non-Cash Consideration received pursuant Holders on a pro rata basis, that amount of Securities equal to this clause (d) the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Securities to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, that if the Company so elects or is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in required by the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt terms of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking Indebtedness that ranks pari passu with the Liens securing Securities, such Net Proceeds Offer may be made ratably to purchase the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business Securities and such other Indebtedness of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of ranks pari passu with the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360Securities. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this Section. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from an one or more Asset Sale for general corporate purposes Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $10.0 million, shall be applied as required pursuant to the end second preceding paragraph). In the event of the 360-day period referred transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the first sentence successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section, and shall comply with the provisions of clause (iii) of this Section 4.09(c).
(d) When with respect to such deemed sale as if it were an Asset Sale. In addition, the aggregate amount fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from Asset Sales not applied for purposes of this Section 4.17. Notice of each Net Proceeds Offer pursuant to (this Section 4.17 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and within materials necessary to enable such Holders to tender Securities pursuant to the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), Net Proceeds Offer and shall state the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal tofollowing terms:
(i) accumulated Excess Proceedsthat Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to prorationing as hereinafter described in the event the Net Proceeds Offer is oversubscribed) in integral multiples of $1,000 of principal amount, multiplied byat the applicable purchase price;
(ii) that the Net Proceeds Offer is being made pursuant to this Section 4.17 and that all Securities tendered will be accepted for payment; provided, however, that if the principal amount of Securities tendered in the Net Proceeds Offer exceeds the aggregate amount of the Net Proceeds Offer Amount, the Company shall select the Securities to be purchased on a fraction pro rata basis (xbased on amounts tendered);
(iii) the numerator purchase price (including the amount of accrued interest, if any) and the purchase date (which is equal shall be no earlier than 30 days nor later than 60 days from the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(iv) that any Security not tendered will continue to accrue interest;
(v) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the outstanding aggregate Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(vi) that Holders electing to have a Security purchased pursuant to the Net Proceeds Offer will be required to surrender the Security, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Offer Payment Date;
(vii) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes Security the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; and
(yviii) the denominator of which is that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers’ Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so to the Holder thereof. For purposes of this Section 4.17, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that only Notes in multiples of $1,000 principal amount (and in a minimum the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect the Securities tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.17, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.17 by virtue thereof. The provisions of such conflictthis Section and other provisions contained in this Indenture relating to the Company’s obligation to make a Net Proceeds Offer may be waived or modified with the written consent of the Holders of a majority in principal amount of the Securities.
Appears in 1 contract
Sources: Indenture (Quality Distribution Inc)
Limitation on Asset Sales. (a) The Company shall not, and shall not cause or permit any of its Restricted Subsidiary Subsidiaries to, make any complete an Asset Sale unless the following conditions are metunless:
(a1) the Asset Sale is for Company or such applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least equal to the Fair Market Value; andValue of the assets sold or otherwise disposed of;
(b2) at least not less than 75% of the consideration received by the Company or its such applicable Restricted Subsidiaries consists Subsidiary, as the case may be, is in the form of (A) cash or Cash Equivalents; provided that for purposes , or (B) Replacement Assets, and in each case set forth in subclauses (A) and (B) of this clause (2a)(2), each is received at the time of such sale or other disposition; PROVIDED that the following shall be considered cash or Cash Equivalents:
amount of (i) the assumption by the purchaser of any Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the NotesDebt) of the Company or a any such applicable Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
that is actually assumed by the transferee in such Asset Sale and from which the Company and its Restricted Subsidiaries are fully and unconditionally released and (ii) Additional Assets,
(iii) instruments, notes, any securities or other obligations received by the Company or any such applicable Restricted Subsidiary from the purchaser that which are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents within ten Business Days of such Asset Sale (to the extent of the cash or Cash Equivalents actually so received), will be deemed to be cash for purposes of this clause (a)(2) and to have been received at the time of such sale; and
(iv3) any Designated Non-Cash Consideration the Asset Sale Proceeds received by the Company or such Restricted Subsidiary in Subsidiary, as the Asset Sale having an aggregate Fair Market Valuecase may be, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstandingare applied, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after option of the receipt of any Net Cash Proceeds from an Asset SaleCompany or such Restricted Subsidiary, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding to prepay, repay or purchase indebtedness under the Credit Agreement (and, in the case Facilities or any other secured Debt of the repayment of Company or such Restricted Subsidiary or the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) Other Senior Notes; or (B) to an investment in properties and assets that are used or are useful in the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business business of the Company or one its Restricted Subsidiaries or more in businesses reasonably similar to or ancillary to the business of the Company or its Restricted SubsidiariesSubsidiaries as conducted at the time of such Asset Sale; provided PROVIDED that a binding commitment to make an acquisition referred to in clause (i) such investment occurs or (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any such Restricted Subsidiary may use any Net Cash Proceeds from an enters into contractual commitments to so apply such Asset Sale for general corporate purposes Proceeds, subject only to customary conditions (including a reduction other than the obtaining of financing), in borrowings under any revolving credit facility) prior each case, within 365 days following the receipt of such Asset Sale Proceeds. If on such 365th day the Available Asset Sale Proceeds exceed $15,000,000, the Company shall apply an amount equal to the end of the 360-day period referred Available Asset Sale Proceeds to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchaserepurchase the Notes (and, at its option, to an offer to repurchase other equal and ratable Debt), at a purchase price in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is cash equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof plus accrued interest toand unpaid interest, but excluding if any, to the purchase date (an "Excess Proceeds Offer"). If an Excess Proceeds Offer is not fully subscribed, the Company may retain and use for general corporate purposes the portion (any such portion, a "Deficiency") of the Available Asset Sale Proceeds not required to repurchase Notes. Upon completion of any Excess Proceeds Offer, the amount of Available Asset Sale Proceeds shall be reset to zero.
(b) If the Company is required to make an Excess Proceeds Offer, the Company shall (1) notify the Trustee thereof at least five Business Days prior to the commencement of the Excess Proceeds Offer and (2) send by first-class mail, postage prepaid, within 30 days of the 365th day following the receipt of the Available Asset Sale Proceeds exceeding $15,000,000 as specified in Section 10.10(a)(3), a notice to the Trustee and to each Holder, at the address appearing in the register maintained by the Security Registrar, stating the information set forth below. The Excess Proceeds Offer shall remain open for a period of 20 Business Days following its commencement (the "Offer Period"). The notice, which shall govern the terms of the Excess Proceeds Offer, shall state:
(A) that the Company is offering to apply the Available Asset Sale Proceeds, to repurchase such Notes at a purchase price in cash equal to 100% of the principal amount of the Notes, plus accrued and unpaid interest, if any, to the purchase date;
(B) that the Excess Proceeds Offer is being made pursuant to this Section 10.10 and the length of time the Excess Proceeds Offer will remain open;
(C) the purchase price and the purchase date (which shall be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is mailed);
(D) that any Note not tendered or accepted for payment will continue to accrue interest;
(E) that, unless the Company defaults in a payment pursuant to the Excess Proceeds Offer, any Notes accepted for payment pursuant to the Excess Proceeds Offer shall cease to accrue interest after the expiration of purchase. If the Offer Period;
(F) that Holders accepting the offer to Purchase is for less than all have a Note purchased pursuant to any Excess Proceeds Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the outstanding Notes Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Business Day preceding the purchase date; 103
(G) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the expiration of the Offer Period, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and Notes in an a statement that such Holder is withdrawing his election to have such Note purchased;
(H) that, if the aggregate principal amount in excess of Notes surrendered by Holders exceeds the purchase amount are tendered and not withdrawn pursuant to the offerAvailable Asset Sale Proceeds, the Issuers Company or the Trustee shall purchase select the Notes having an aggregate principal amount equal to the purchase amount be purchased on a pro rata basis to the extent practicable, (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of US$1,000, or integral multiples of $1,000 US$1,000, shall be purchased);
(I) that Holders whose Notes are being purchased only in part will be issued new Notes equal in aggregate principal amount (to the unpurchased portion of the Notes surrendered; PROVIDED that each Note purchased and each such new Note issued shall be in a minimum an original principal amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 US$1,000 and any integral multiple multiples of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.US$1,000; and
Appears in 1 contract
Sources: Indenture (Norske Skog Canada LTD)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company's Board of Directors);
(b2) at least 75% of the consideration received by the Company or its such Restricted Subsidiaries consists of Subsidiary, as the case may be, from such Asset Sale shall be cash or Cash EquivalentsEquivalents and is received at the time of such disposition; provided PROVIDED that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ix) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes notes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a such Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Notes and other than liabilities consisting of law Disqualified Capital Stock) (i) that are assumed by the transferee of any such assets and from which the Company and its Restricted Subsidiaries are unconditionally released or a customary novation agreement,
(ii) Additional Assets,
in respect of which neither the Company nor any Restricted Subsidiary following such sale has any obligation and (iiiy) instruments, notes, securities any notes or other obligations received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any no event within 90 more than 60 days of the closingafter receipt, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents (to the extent of the cash or Cash Equivalents actually so received), shall be deemed to be cash for purposes of this provision; and
(iv3) any Designated Non-Cash Consideration received by upon the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value consummation of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) Company shall apply, or cause such Restricted Subsidiary to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminatedapply, the Net Cash Proceeds not so applied will be deemed relating to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an such Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end within 360 days of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal toreceipt thereof either:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.
Appears in 1 contract
Sources: Indenture (Big Flower Digital Services Delaware Inc)
Limitation on Asset Sales. The Company shall will not, and shall will not permit any of the Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; and
equal to the fair market value of the assets sold or otherwise disposed of (bas determined in good faith by the Company's Board of Directors), (ii) at least 7580% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash EquivalentsEquivalents and is received at the time of such disposition; provided PROVIDED, HOWEVER, that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(iA) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes notes thereto) ), of the Company or any Restricted Subsidiary (other than Subordinated Debt or other obligations or liabilities that are by their terms subordinated in right of payment to the Notes) of that are assumed by the transferee in such Asset Sale and from which the Company or a such Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
is released and (iiB) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, immediately converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents (to the extent of the cash or Cash Equivalents actually so received), shall be deemed to be cash for the purposes of this provision; and (iii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either (A) to prepay any Indebtedness ranking at least PARI PASSU with the Notes (including amounts under the Credit Facility) and
, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility, (ivB) any Designated Non-to make an investment in properties and assets that replace the properties and assets that were the subject of such Asset Sale or in properties and assets that will be used in the business of the Company and the Restricted Subsidiaries as existing on the Issue Date or in businesses reasonably related thereto ("Replacement Assets"), or (C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). On the 361st day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Consideration received Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each, a "Net Proceeds Offer Trigger Date"), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each a "Net Proceeds Offer Amount") shall be applied by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchasepurchase (the "Net Proceeds Offer") on a date (the "Net Proceeds Offer Payment Date") not less than 45 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, in accordance with Section 3.02from all Holders on a PRO RATA basis, that amount of Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is Net Proceeds Offer Amount at a price equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount of the Notes to be purchased, plus accrued and unpaid interest tothereon, but excluding if any, to the date of purchase; PROVIDED, HOWEVER, that if at any time any non-cash consideration received by the Company or any Restricted Subsidiary, as the case may be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.15. If The Company may defer the Net Proceeds Offer to Purchase until there is for less than all of the outstanding Notes and Notes in an aggregate principal unutilized Net Proceeds Offer Amount equal to or in excess of $5 million resulting from one or more Asset Sales (at which time, the entire unutilized Net Proceeds Offer Amount, not just the amount in excess of the purchase amount are tendered and not withdrawn $5 million, shall be applied as required pursuant to this paragraph). In the offerevent of the transfer of substantially all (but not all) of the property and assets of the Company and the Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01, the Issuers successor corporation shall purchase Notes having be deemed to have sold the properties and assets of the Company and the Restricted Subsidiaries not so transferred for purposes of this covenant, and shall comply with the provisions of this covenant with respect to such deemed sale as if it were an aggregate principal amount equal Asset Sale. In addition, the fair market value of such properties and assets of the Company or the Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this covenant. Notwithstanding the purchase amount on a pro rata basis two immediately preceding paragraphs, the Company and the Restricted Subsidiaries will be permitted to consummate an Asset Sale without complying with such paragraphs to the extent practicable, with adjustments (i) at least 80% of the consideration for such Asset Sale constitutes Replacement Assets and (ii) such Asset Sale is for fair market value; PROVIDED that any consideration not constituting Replacement Assets received by the Company so that only or any of the Restricted Subsidiaries in connection with any Asset Sale permitted to be consummated under this paragraph shall constitute Net Cash Proceeds subject to the provisions of the two preceding paragraphs. Each Net Proceeds Offer will be mailed to the record Holders as shown on the register of Holders within 30 days following the Net Proceeds Offer Trigger Date, with a copy to the Trustee, and shall comply with the procedures set forth in this Indenture. Upon receiving notice of the Net Proceeds Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used exchange for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09cash. To the extent that Holders properly tender Notes in an amount exceeding the provisions Net Proceeds Offer Amount, Notes of tendering Holders will be purchased on a PRO RATA basis (based on amounts tendered). A Net Proceeds Offer shall remain open for a period of 20 business days or such longer period as may be required by law. If the Net Proceeds Offer is on or after a Record Date and on or before the related Interest Payment Date, any securities laws or regulations conflict with Section 4.09 or Section 3.02accrued interest shall be paid to the Person in whose name a Note is registered at the close of business on such Record Date, and no additional interest shall be payable to Holders who tender Notes pursuant to the Issuers Net Proceeds Offer. The notice, which shall comply with govern the applicable securities laws and regulations terms of the Net Proceeds Offer, shall include such disclosures as are required by law and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.state:
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall Borrower will not, and shall will not permit any of the Restricted Subsidiary Subsidiaries to, make directly or indirectly, consummate any Asset Sale unless the following conditions are metunless:
(ai) the Borrower or the Restricted Subsidiary, as the case may be, receives consideration at the time of consummation of such Asset Sale is for at least equal to the Fair Market ValueValue of the assets or Equity Interests issued or sold or otherwise disposed of; and
(bii) at least 75% of the consideration received in such Asset Sale by the Company Borrower or its such Restricted Subsidiaries consists Subsidiary is in the form of cash or Cash Equivalents; provided provided, that for the foregoing requirements shall not apply with respect to any Involuntary Transfer.
(b) For purposes of this clause (2Section 6.04(a), each of the following shall will be considered cash or Cash Equivalentsdeemed to be cash:
(i) the assumption by the purchaser of Debt any Indebtedness or other obligations or liabilities (liabilities, as shown on the CompanyBorrower’s most recent consolidated balance sheet sheet, of the Borrower or in the footnotes thereto) any Restricted Subsidiary (other than Subordinated Debt or other obligations or contingent liabilities and liabilities that are by their terms subordinated in right of payment to the First Lien Notes, the Indebtedness under the Loan Documents or any guarantee thereof) that are assumed, repaid or retired by the transferee of any such assets so long as the Company Borrower or a such Restricted Subsidiary pursuant to operation of law or a customary novation agreement,is released from further liability in respect thereof; and
(ii) Additional Assets,
(iii) instrumentsany securities, notes, securities notes or other obligations received by the Company Borrower or any such Restricted Subsidiary from such transferee that are, within 180 days after receipt thereof, converted by the Borrower or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);conversion.
(c) Within 360 Subject to Section 2.11(c), within 365 days after the receipt of any Net Cash Proceeds from an Asset SaleSale (including, without limitation, an Involuntary Transfer), the Borrower or the applicable Restricted Subsidiary, as the case may be, shall apply such Net Cash Proceeds may be usedat its option to any combination of the following:
(i) to permanently repay Indebtedness under this Agreement and correspondingly reduce commitments with respect thereto or to repurchase, repay or prepay (Aor offer to repurchase, repay or prepay) other First Lien Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu accordance with the Liens securing the Notes (if any) through making the Offer to Purchase below,its terms;
(ii) to acquire Additional Assets; orall or substantially all of the assets of, or any Capital Stock of, any Person primarily engaged in a Permitted Business, if, in the case of any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary as a result of such acquisition;
(iii) to make a capital expenditures expenditure that is used or useful in a Permitted Business; or
(iv) to acquire other assets that are not classified as current assets under GAAP and that are used or useful in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (iiincluding, without limitation, Vessels, related assets and any related Ready for Sea Costs) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date make any deposit, installment or progress payment in respect of such commitment; assets or payment of any related Ready for Sea Costs, provided that (x) such investment is consummated a binding commitment made within 180 days of the end of the 360365-day period referred described above by the Borrower or the applicable Restricted Subsidiary to apply Net Proceeds from an Asset Sale in accordance with clauses (ii), (iii) and/or (iv) above shall satisfy the first sentence requirements of this paragraph such clauses with respect to such Net Proceeds so long as such Net Proceeds are actually so applied within 545 days from the receipt thereof from such Asset Sale and (y) if all or any portion of the assets sold or transferred in such acquisition is not consummated within Asset Sale constituted Collateral, in the period set forth in case of any application of Net Proceeds pursuant to clause (xii), (iii) or such binding commitment is terminated(iv) above, the Borrower shall, or shall cause the applicable Restricted Subsidiary to, pledge any assets (including, without limitation, any acquired Capital Stock) acquired with such Net Cash Proceeds not so applied will be deemed to be Excess Proceeds secure the First Lien Obligations on a first-priority secured basis (as defined below). For subject to the avoidance payment priority in favor of doubt, pending application thereof the Lenders hereunder and subject to Permitted Collateral Liens) pursuant to the Collateral Documents in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c)Agreement.
(d) When Pending the aggregate amount final application of any Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer Borrower or the applicable Restricted Subsidiary may apply the Net Proceeds to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the temporarily reduce outstanding aggregate principal amount revolving credit Indebtedness of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount Borrower or any of the Notes Restricted Subsidiaries, respectively, or invest the Net Proceeds in cash and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflictCash Equivalents.
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any of the Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; and
equal to the fair market value of the assets sold or otherwise disposed of (bas determined in good faith by the Company’s Board of Directors), (ii) at least 7560% of the consideration received by the Company or its the Restricted Subsidiaries consists of Subsidiary, as the case may be, from such Asset Sale shall be cash or Cash Equivalents; provided provided, that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any such Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Notes) that are assumed by the transferee of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 90 days (to the extent of the cash received), shall be deemed to be cash for the purposes of this clause (ii) or for purposes of the second paragraph of this covenant, and (iii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Equivalents actually so receivedProceeds relating to such Asset Sale within 547 days of receipt thereof either (A) to reinvest in Productive Assets, and
(ivB) to repay any Designated Non-Indebtedness (other than payments made on any revolving credit facility Indebtedness where the underlying commitment is not permanently reduced) that was secured by the assets sold in such Asset Sale or (C) a combination of prepayment, repurchase and investment permitted by the foregoing clauses (iii)(A) and (iii)(B); provided, that the amount of the Net Cash Consideration received Proceeds relating to such Asset Sale that the Company must apply pursuant to this clause (iii) shall be reduced, dollar for dollar, by the amount of any Qualified Investment made by the Company at any time during the 180 day period prior to the consummation of such Asset Sale except to the extent such Qualified Investment was made using Net Cash Proceeds from a prior Asset Sale pursuant to the foregoing clause (iii)(A). Pending the final application of any such Net Cash Proceeds, the Company or such Restricted Subsidiary may temporarily reduce Indebtedness under a revolving credit facility, if any, or otherwise invest such Net Cash Proceeds in Cash Equivalents. On the 548th day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds (as reduced by any Qualified Investment) relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) or (iii)(C) of the next preceding sentence (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary to make an offer to purchase (the “Net Proceeds Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, from all Holders on a pro rata basis that amount of Notes equal to the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Notes to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, that if at any time any non-cash consideration received by the Company or any Restricted Subsidiary, as the case may be, in the connection with any Asset Sale having an aggregate Fair Market Valueis converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), taken together with all other Designated Non-Cash Consideration received pursuant then such conversion or disposition shall be deemed to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from constitute an Asset Sale, Sale hereunder and the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above thereof shall be treated as applied in accordance with this covenant. Notwithstanding the foregoing, if a permitted Net Proceeds Offer Amount is less than $50.0 million, the application of the Net Cash Proceeds constituting such Net Proceeds Offer Amount to a Net Proceeds Offer may be deferred until such time as such Net Proceeds Offer Amount plus the aggregate amount of all Net Proceeds Offer Amounts arising subsequent to the Net Proceeds Offer Trigger Date relating to such initial Net Proceeds Offer Amount from all Asset Sales by the date of such commitment; provided that (x) such investment is consummated within 180 days of Company and the end of Restricted Subsidiaries aggregates at least $50.0 million, at which time the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) Company or such binding commitment is terminated, the Restricted Subsidiary shall apply all Net Cash Proceeds not constituting all Net Proceeds Offer Amounts that have been so applied will deferred to make a Net Proceeds Offer (the first date the aggregate of all such deferred Net Proceeds Offer Amounts is equal to $50.0 million or more shall be deemed to be Excess a “Net Proceeds (as defined belowOffer Trigger Date”). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end Upon receiving notice of the 360-day period referred Net Proceeds Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1,000 in exchange for cash. To the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and extent Holders properly tender Notes in an aggregate principal amount in excess exceeding the Net Proceeds Offer Amount, Notes of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount tendering Holders will be purchased on a pro rata basis (based on amounts tendered). A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. To the extent that the aggregate amount of Notes tendered pursuant to a Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use any remaining Net Proceeds Offer Amount for general corporate purposes. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero.
(b) Subject to the extent practicabledeferral of the Net Proceeds Offer Trigger Date contained in the second paragraph of subsection (a) above, each notice of a Net Proceeds Offer pursuant to this Section 4.16 shall be mailed or caused to be mailed, by first class mail, by the Company not more than 25 days after the Net Proceeds Offer Trigger Date to all Holders at their last registered addresses as of a date within 15 days of the mailing of such notice, with a copy to the Trustee. The notice shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Net Proceeds Offer and shall state the following terms:
(1) that the Net Proceeds Offer is being made pursuant to Section 4.16 of this Indenture and that all Notes tendered will be accepted for payment; provided, however, that if the aggregate principal amount of Notes tendered in a Net Proceeds Offer plus accrued interest at the expiration of such offer exceeds the aggregate amount of the Net Proceeds Offer, the Company shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so that only Notes in multiples or portions of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, Notes in denominations of $1.00 and 1,000 or multiples thereof shall be purchased); provided, that the Company may first purchase any integral multiple Notes that are tendered that have a principal amount of $1.00 10,000 or less;
(2) the purchase price (including the amount of accrued interest) and the purchase date (which shall be 20 Business Days from the date of mailing of notice of such Net Proceeds Offer, or such longer period as required by law) (the “Proceeds Purchase Date”);
(3) that any Note not tendered will continue to accrue interest;
(4) that, unless the Company defaults in excess thereof with respect making payment therefore, any Note accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Proceeds Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to a PIK Net Proceeds Offer will be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day prior to the Proceeds Purchase Date;
(6) that Holders will be entitled to withdraw their election in whole or in part if the Paying Agent receives, not later than five Business Days prior to the Proceeds Purchase Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes the Holder delivered for purchase and a statement that such H▇▇▇▇▇ is withdrawing his election to have such Note purchased; and
(7) that Holders whose Notes are purchased only in part will be issued new Notes in a principal amount equal to the unpurchased portion of a Global the Notes surrendered; provided, that each Note constituting PIK Interest)so purchased in part and each new Note issued shall be in an original principal amount of $1,000 or integral multiples thereof. Upon completion On or before the Proceeds Purchase Date, the Company shall (i) accept for payment Notes or portions thereof tendered pursuant to the Net Proceeds Offer which are to be purchased in accordance with item (b)(1) above, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the purchase price plus accrued interest, if any, of all Notes to be purchased and (iii) deliver to the Offer Trustee Notes so accepted together with an Officers’ Certificate stating the Notes or portions thereof being purchased by the Company. The Paying Agent shall promptly mail to Purchasethe Holders of Notes so accepted payment in an amount equal to the purchase price plus accrued interest, Excess Proceeds will be reset at zeroif any. For purposes of this Section 4.16, and any Excess Proceeds the Trustee shall act as the Paying Agent. Any amounts remaining after consummation the purchase of Notes pursuant to a Net Proceeds Offer shall be returned by the Offer Trustee to Purchase may be used for any purpose not otherwise prohibited by this Indenturethe Company. The Issuers Company shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02the provisions of this Indenture relating to a Net Proceeds Offer, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 relating to such Net Proceeds offer by virtue of such conflictthereof.
Appears in 1 contract
Sources: Indenture (NRG Energy Inc)
Limitation on Asset Sales. (i) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s senior management or, in the case of an Asset Sale in excess of $5.0 million, the Board of Directors of the Company);
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of (x) cash or Cash Equivalents, (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business or (z) Capital Stock in one or more Persons engaged in a Permitted Business that are or thereby become Restricted Subsidiaries of the Company, and, in each case, such consideration is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Securities) that are assumed by the transferee of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations securities received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 180 days after such Asset Sale (to the extent of the cash or Cash Equivalents actually so received, received in the conversion) shall be deemed to be cash for the purposes of this provision only; and
(iviii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either:
(A) to permanently reduce any Designated Non-Indebtedness that is secured by a Lien permitted under this Indenture, including Indebtedness under the Credit Agreement, or any Indebtedness of a Restricted Subsidiary that is not a Guarantor and, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility (or effect a permanent reduction in the availability under such revolving credit facility regardless of the fact that no prepayment is required);
(B) to make an investment (x) in properties and assets that replace the properties and assets that were the subject of such Asset Sale, (y) in properties and assets that will be used by the Company or a Restricted Subsidiary in a Permitted Business or (z) permitted by clause (1) of the definition of Permitted Investments (collectively, “Replacement Assets”); or
(C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Pending the final application of the Net Cash Consideration received Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Indebtedness or otherwise invest such Net Cash Proceeds in any manner not prohibited by this Indenture. On the 361st day after an Asset Sale or such earlier date, if any, as the senior management or the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary in to make an offer to purchase (the Asset Sale having an aggregate Fair Market Value“Net Proceeds Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, taken together with from all other Designated Non-Cash Consideration received pursuant Holders on a pro rata basis, that amount of Securities equal to this clause (d) the Net Proceeds Offer Amount at a price equal to 100% of the principal amount of the Securities to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, that if the Company so elects or is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in required by the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt terms of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking Indebtedness that ranks pari passu with the Liens securing Securities, such Net Proceeds Offer may be made ratably to purchase the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business Securities and such other Indebtedness of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of ranks pari passu with the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360Securities. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.17. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from an one or more Asset Sale for general corporate purposes Sales since the Series A Issue Date (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $10.0 million, shall be applied as required pursuant to the end second preceding paragraph). In the event of the 360-day period referred transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01, which transaction does not constitute a Change of Control, the first sentence successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section, and shall comply with the provisions of clause (iii) of this Section 4.09(c).
(d) When 4.17 with respect to such deemed sale as if it were an Asset Sale. In addition, the aggregate amount fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from Asset Sales not applied for purposes of this Section 4.17. Notice of each Net Proceeds Offer pursuant to (this Section 4.17 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and within materials necessary to enable such Holders to tender Securities pursuant to the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), Net Proceeds Offer and shall state the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal tofollowing terms:
(i) accumulated Excess Proceedsthat Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to prorationing as hereinafter described in the event the Net Proceeds Offer is oversubscribed) in integral multiples of $1,000 of principal amount, multiplied byat the applicable purchase price;
(ii) that the Net Proceeds Offer is being made pursuant to this Section 4.17 and that all Securities tendered will be accepted for payment; provided, however, that if the principal amount of Securities tendered in the Net Proceeds Offer exceeds the aggregate amount of the Net Proceeds Offer Amount, the Company shall select the Securities to be purchased on a fraction pro rata basis (xbased on amounts tendered);
(iii) the numerator purchase price (including the amount of accrued interest, if any) and the purchase date (which is equal shall be no earlier than 30 days nor later than 60 days from the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(iv) that any Security not tendered will continue to accrue interest;
(v) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the outstanding aggregate Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(vi) that Holders electing to have a Security purchased pursuant to the Net Proceeds Offer will be required to surrender the Security, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Offer Payment Date;
(vii) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes Security the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; and
(yviii) the denominator of which is that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers’ Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so to the Holder thereof. For purposes of this Section 4.17, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that only Notes in multiples of $1,000 principal amount (and in a minimum the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect the Securities tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.17, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.17 by virtue thereof. The provisions of such conflictthis Section 4.17 and other provisions contained in this Indenture relating to the Company’s obligation to make a Net Proceeds Offer may be waived or modified with the written consent of the Holders of a majority in principal amount of the Securities.
Appears in 1 contract
Sources: Indenture (Quality Distribution Inc)
Limitation on Asset Sales. The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; and
equal to the fair market value of the assets sold or otherwise disposed of (bas determined in good faith by the Company's Board of Directors), and (ii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash Equivalents; provided that for purposes (A) the amount of this clause (2), each any liabilities of the following shall be considered cash Company or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) any such Restricted Subsidiary (other than Subordinated Debt or other obligations or liabilities that are by their terms subordinated in right of payment to the Notes) that are assumed by the transferee of any such assets and (B) the Company or a Restricted Subsidiary pursuant to operation fair market value of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, any marketable securities or other obligations received by the Company or any such Restricted Subsidiary from the purchaser in exchange for any such assets that are promptlypromptly converted into cash shall be deemed to be cash for purposes of this provision; and provided, but further, that in any no event within 90 days shall the aggregate fair market value at the time of the closing, converted receipt of con- sideration received by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the in a form other than cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by exceed 5% of the Company or such Restricted Subsidiary in Company's Consolidated Total Assets. In the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value event of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds may be used:
(i) relating to permanently repay such Asset Sale within 360 days of receipt thereof either (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility to repay or prepay any indebtedness under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or and effect a permanent reduction thereof, (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures an investment in a Permitted Business either (x) properties and assets that replace the properties and assets that were the subject of such Asset Sale or (y) any properties or assets that will be used in the business of the Company and its Restricted Subsidiaries as existing on the Issue Date or one in businesses similar or more Restricted Subsidiaries; provided that reasonably related thereto or in the capital stock of any entity a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application majority of whose assets consists of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause properties or assets described under (x) or such binding commitment is terminated(y) ("Replacement Assets"), or (C) to a combination of prepayment and investment permitted by the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds foregoing clauses (as defined belowiii)(A) and (iii)(B). For After 360 days from the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When on which the aggregate amount of Net Cash Proceeds from Asset Sales which have not been applied pursuant to as permitted in clauses (iii)(A), (iii)(B) and within (iii)(C) of the time frame set forth in) Section 4.09(cnext preceding sentence (a "Net Proceeds Offer Amount") exceeds $25.0 million 7,500,000 (“Excess Proceeds”the "Net Proceeds Offer Trigger Date"), the Issuers must, within 30 days, Company shall make an offer to purchasepurchase (the "Net Proceeds Offer") from all Holders on a pro rata basis, in accordance with Section 3.02, that amount of Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is Net Proceeds Offer Amount at a price equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount Accreted Value of the Notes to be purchased, plus accrued and unpaid interest tothereon, but excluding if any, to the date of purchase. If at any time any non-cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof shall be applied in accordance with this Section. To the extent that the aggregate Accreted Value of Notes tendered pursuant to such Net Proceeds Offer to Purchase is for less than all the Net Proceeds Offer Amount the Company and its Restricted Subsidiaries may use such deficiency for general corporate purposes. If the aggregate Accreted Value of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are validly tendered and not withdrawn pursuant to by Holders thereof exceeds the offerNet Proceeds Offer Amount, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount be purchased will be selected on a pro rata basis basis. Upon completion of such Net Proceeds Offer, the amount of Net Proceeds Offer Amount will be reset to zero. Notwithstanding the immediately preceding paragraph, the Company and its Restricted Subsidiaries will be permitted to consummate an Asset Sale without complying with such paragraphs to the extent practicable, with adjustments (i) at least 80% of the consideration for such Asset Sale constitutes Replacement Assets and (ii) such Asset Sale is for fair market value; provided that any consid- eration not constituting Replacement Assets received by the Company so that only or any of its Restricted Subsidiaries in connection with any Asset Sale permitted to be consummated under this paragraph shall constitute Net Cash Proceeds subject to the provisions of the preceding paragraph. Each Net Proceeds Offer will be mailed to the record Holders as shown on the register of Holders not less than 30 days nor more than 45 days following the Net Proceeds Offer Trigger Date, with a copy to the Trustee, and shall comply with the procedures set forth in this Indenture. Upon receiving notice of the Net Proceeds Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1,000 principal amount (and at maturity in a minimum exchange for cash. To the extent Holders properly tender Notes in an amount exceeding the Net Proceeds Offer Amount, Notes of $1,000) tendering Holders will be purchased on a pro rata basis (based on amounts tendered). A Net Proceeds Offer shall remain open for a period of 20 business days or such longer period as may be required by law, and the purchase of such Note shall be consummated within 60 days following the mailing of the Net Proceeds Offer. The notice, which shall govern the terms of the Net Proceeds Offer, shall include such disclosures as are required by law and shall state:
(i) that the Net Proceeds Offer is being made pursuant to this Section 4.15;
(ii) the purchase price (equal to 100% of the Accreted Value thereof plus of accrued and unpaid interest, if any) to be paid for Notes purchased pursuant to the Net Proceeds Offer and the Net Proceeds Payment Date;
(iii) that any Note not tendered for payment will continue to accrete and accrue interest in accordance with the terms thereof;
(iv) that, unless the Company defaults on making the payment, any Note accepted for payment pursuant to the Net Proceeds Offer shall cease to accrete and accrue interest after the Net Proceeds Payment Date;
(v) that Holders accepting the Offer to have their Notes purchased pursuant to the Net Proceeds Offer will be required to surrender their Notes to the Paying Agent at the address specified in the notice prior to the close of business on the Excess Net Payment Date;
(vi) that Holders will be entitled to withdraw their acceptance if the Paying Agent receives, not later than the close of business on the second Business Day prior to the Net Proceeds Payment Date, a PIK Payment has been madefacsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Notes purchased;
(vii) that Holders whose Notes are purchased only in part will be issued new Notes in a principal amount at maturity equal to the unpurchased portion of the Notes surrendered; provided that each Note purchased and each such new Note issued shall be in an original principal amount at maturity in denominations of $1.00 1,000 and integral multiples thereof;
(viii) any integral multiple other procedures that a Holder must follow to accept a Net Proceeds Offer or effect withdrawal of such acceptance; and
(ix) the name and address of the Paying Agent. On the Net Proceeds Payment Date, the Company shall (i) accept for payment Notes or portions thereof tendered pursuant to the Net Proceeds Offer in accordance with this Section 4.15, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the Net Proceeds Offer Amount to be purchased in accordance with this Section 4.15 and (iii) deliver to the Trustee Notes so accepted together with an Officers' Certificate stating the Notes or portions thereof tendered to and accepted for payment by the Company. For purposes of this Section 4.15, the Trustee shall act as the Paying Agent. The Paying Agent shall promptly (but in any case no later than 10 calendar days after the Net Proceeds Payment Date) mail or deliver to the Holders of Notes so accepted payment in an amount equal to the purchase price for such Notes, and the Company shall execute and issue, and the Trustee shall promptly authenticate and mail to such Holders, a new Note equal in principal amount at maturity to any unpurchased portion of the Note surrendered; provided that each such new Note shall be issued in an original principal amount at maturity in denominations of $1.00 in excess thereof with respect 1,000 and integral multiples thereof. The Company will send to the Trustee and the Holders of Notes on or as soon as practicable after the Net Proceeds Payment Date a PIK Note or notice setting forth the portion of a Global Note constituting PIK Interest). Upon completion results of the Offer Net Proceeds Offer. Any Notes not so accepted shall be promptly mailed or delivered by the Company to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this IndentureHolder thereof. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.024.15, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.15 by virtue of such conflictthereof.
Appears in 1 contract
Limitation on Asset Sales. The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Valueequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company's Board of Directors); and
(bii) at least 7580% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash EquivalentsEquivalents and is received at the time of such disposition; provided provided, however, that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(iA) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes notes thereto) ), of the Company or any Restricted Subsidiary (other than Subordinated Debt or other obligations or liabilities that are by their terms subordinated in right of payment to the Notes) of that are assumed by the transferee in such Asset Sale and from which the Company or a such Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
is released and (iiB) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event converted within 90 10 business days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents (to the extent of the cash or Cash Equivalents actually so received), shall be deemed to be cash for the purposes of this provision; and (iii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 270 days of receipt thereof either (A) to prepay any Indebtedness ranking at least pari passu with the Notes or the Guarantees and
, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility, (ivB) any Designated Non-to make an investment in properties and assets that replace the properties and assets that were the subject of such Asset Sale or in properties and assets that will be used in the business of the Company and its Restricted Subsidiaries as existing on the Issue Date or in businesses reasonably related thereto ("Replacement Assets"), or (C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). On the 271st day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Consideration received Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each, a "Net Proceeds Offer Trigger Date"), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each a "Net Proceeds Offer Amount") shall be applied by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchasepurchase (the "Net Proceeds Offer") on a date (the "Net Proceeds Offer Payment Date") not less than 30 nor more than 45 days following the applicable Net Proceeds Offer Trigger Date, in accordance with Section 3.02from all Holders on a pro rata basis, that amount of Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is Net Proceeds Offer Amount at a price equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount of the Notes to be purchased, plus accrued and unpaid interest tothereon, but excluding if any, to the date of purchase; provided, however, that if at any time any non-cash consideration received by the Company or any Restricted Subsidiary, as the case may be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.15. If The Company may defer the Net Proceeds Offer to Purchase until there is for less than all of the outstanding Notes and Notes in an aggregate principal unutilized Net Proceeds Offer Amount equal to or in excess of $5.0 million resulting from one or more Asset Sales (at which time the entire unutilized Net Proceeds Offer Amount, not just the amount in excess of $5.0 million, shall be applied as required pursuant to this paragraph). To the purchase extent the aggregate amount are of the Notes tendered and not withdrawn pursuant to the offerNet Proceeds Offer is less than the Net Proceeds Offer Amount, the Issuers Company may use such deficiency for general corporate purposes. Upon completion of such offer to purchase, the Net Proceeds Offer Amount shall be reset at zero. In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01, the successor corporation shall be deemed to have sold the properties and assets of the Company and the Restricted Subsidiaries not so transferred for purposes of this covenant, and shall comply with the provisions of this covenant with respect to such deemed sale as if it were an Asset Sale. In addition, the fair market value of such properties and assets of the Company or the Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this covenant. Notwithstanding the two immediately preceding paragraphs, the Company and its Restricted Subsidiaries will be permitted to consummate an Asset Sale without complying with such paragraphs to the extent (i) at least 80% of the consideration for such Asset Sale constitutes Replacement Assets and (ii) such Asset Sale is for fair market value; provided that any consideration not constituting Replacement Assets received by the Company or any of the Restricted Subsidiaries in connection with any Asset Sale permitted to be consummated under this paragraph shall constitute Net Cash Proceeds subject to the provisions of the two preceding paragraphs. Each Net Proceeds Offer will be mailed to the record Holders as shown on the register of Holders within 25 days following the Net Proceeds Offer Trigger Date, with a copy to the Trustee, and shall comply with the procedures set forth in this Indenture. Upon receiving notice of the Net Proceeds Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1,000 in exchange for cash. To the extent Holders properly tender Notes in an amount exceeding the Net Proceeds Offer Amount, Notes of tendering Holders will be purchased on a pro rata basis (based on amounts tendered). A Net Proceeds Offer shall remain open for a period of 20 business days or such longer period as may be required by law. The notice, which shall govern the terms of the Net Proceeds Offer, shall include such disclosures as are required by law and shall state:
(i) that the Net Proceeds Offer is being made pursuant to this Section 4.15;
(ii) the purchase price (including the amount of accrued interest, if any) to be paid for Notes having an aggregate purchased pursuant to the Net Proceeds Offer and the Net Proceeds Payment Date;
(iii) that any Note not tendered for payment will continue to accrue interest in accordance with the terms thereof;
(iv) that, unless the Company defaults on making the payment, any Note accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Payment Date;
(v) that Holders accepting the Offer to have their Notes purchased pursuant to the Net Proceeds Offer will be required to surrender their Notes to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Payment Date;
(vi) that Holders will be entitled to withdraw their acceptance if the Paying Agent receives, not later than the close of business on the second Business Day prior to the Net Proceeds Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Notes purchased;
(vii) that Holders whose Notes are purchased only in part will be issued new Notes in a principal amount equal to the purchase amount on a pro rata basis to unpurchased portion of the extent practicable, with adjustments by the Company so Notes surrendered; provided that only Notes each Note purchased and each such new Note issued shall be in multiples of $1,000 an original principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 1,000 and integral multiples thereof;
(viii) any integral multiple other procedures that a Holder must follow to accept a Net Proceeds Offer or effect withdrawal of such acceptance; and
(ix) the name and address of the Paying Agent. On the Net Proceeds Payment Date, the Company shall (i) accept for payment Notes or portions thereof tendered pursuant to the Net Proceeds Offer in accordance with this Section 4.15, (ii) deposit timely with the Paying Agent U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest, if any, of all Notes to be purchased in accordance with this Section 4.15 and (iii) deliver to the Trustee Notes so accepted together with an Officers' Certificate stating the Notes or portions thereof tendered to and accepted for payment by the Company. For purposes of this Section 4.15, the Trustee shall act as the Paying Agent. The Paying Agent shall promptly mail or deliver to the Holders of Notes so accepted payment in an amount equal to the purchase price for such Notes, and the Company shall execute and issue, and the Trustee shall promptly authenticate and mail to such Holders, a new Note equal in principal amount to any unpurchased portion of the Note surrendered; provided that each such new Note shall be issued in an original principal amount in denominations of $1.00 in excess thereof with respect 1,000 and integral multiples thereof. The Company will send to the Trustee and the Holders of Notes on or as soon as practicable after the Net Proceeds Payment Date a PIK Note or notice setting forth the portion of a Global Note constituting PIK Interest). Upon completion results of the Offer Net Proceeds Offer. Any Notes not so accepted shall be promptly mailed or delivered by the Company to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this IndentureHolder thereof. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act Act, if applicable, and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02the "Asset Sale" provisions of this Indenture, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.15 by virtue of such conflictthereof.
Appears in 1 contract
Sources: Indenture (Penn National Gaming Inc)
Limitation on Asset Sales. The Indenture shall provide that the Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are met:
(a) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; and
equal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Board of Directors of the Company, (b) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists of Subsidiary, as the case may be, from such Asset Sale shall be cash or Cash EquivalentsEquivalents and is received at the time of such disposition; provided provided, however, that this condition shall not apply to a transaction whereby the Company or any Restricted Subsidiary effects an Asset Sale by the exchange of assets or property for purposes Productive Assets or to the sale or other disposition of this clause (2), each all or any portion of the following shall be considered cash Company's East Mill assets located in Antioch, California, provided, further, that the amount of (A) any liabilities of the Company or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) any Restricted Subsidiary (other than Subordinated Debt or other obligations or liabilities that are by their terms subordinated in right of payment to the Notes) that are assumed by the transferee of the Company or a Restricted Subsidiary pursuant any such assets shall be deemed to operation be cash for purposes of law or a customary novation agreement,
this provision and (iiB) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, immediately converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash received) shall be deemed to be cash for purposes of this provision, and (c) the Company shall (i) apply, or cause such Restricted Subsidiary to apply, such Net Cash Equivalents Proceeds of such Asset Sale within 270 days of the consummation of such Asset Sale (A) to prepay indebtedness ranking pari passu with the Notes, senior indebtedness of a Subsidiary Guarantor or debt of a Restricted Subsidiary that is not a Subsidiary Guarantor or, in the case of any debt under a revolving credit facility, effect a reduction in the committed availability under any such revolving credit facility or (B) to make an offer to purchase the Notes and, to the extent required by the documentation governing such indebtedness and on a pro rata basis, indebtedness ranking pari passu with the Notes, at a price equal to 100% of the principal amount of the Notes plus accrued interest thereon to the date of purchase pursuant to an offer to purchase made by the Company as set forth below (a "Net Proceeds Offer"), or (ii)(A) commit, or cause such Restricted Subsidiary to commit (such commitments to include amounts anticipated to be expended pursuant to the Company's capital investment plan (x) as adopted by the Board of Directors of the Company and (y) evidenced by the filing of an officer's certificate with the Trustee stating that the total amount of the Net Cash Proceeds of such Asset Sale is less than the aggregate amount contemplated to be expended pursuant to such capital investment plan within 24 months of the consummation of such Asset Sale) within 270 days of the consummation of such Asset Sale, to apply the Net Cash Proceeds of such Asset Sale to reinvest in Productive Assets and (B) apply, or cause such Restricted Subsidiary to apply, pursuant to such commitment (which includes amounts actually so receivedexpended under the capital investment plan authorized by the Board of Directors of the Company), and
such Net Cash Proceeds of such Asset Sale within 24 months of the consummation of such Asset Sale; provided that if any commitment under this clause (ivii) is terminated or rescinded after the 225th day after the consummation of such Asset Sale, the Company or such Restricted Subsidiary, as the case may be, shall have 45 days after such termination or rescission to (1) apply such Net Cash Proceeds pursuant to clause (c) (i) above or (2) to commit, or cause such Restricted Subsidiary to commit, to apply the Net Cash Proceeds of such Asset Sale to 39 reinvest in Productive Assets; provided that in any such case, such proceeds must be applied pursuant to clause (c)(i) or such commitment, as the case may be, no later than 24 months after the consummation of such Asset Sale or (iii) any Designated Noncombination of the foregoing; provided, further, that if at time any non-Cash Consideration cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash, then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof shall be applied in accordance with clause (c) above; and provided, further, that the Company may defer making a Net Proceeds Offer until the aggregate Net Cash Proceeds from Asset Sales to be applied equals or exceeds $10 million. Pending the final application of any such Net Cash Proceeds the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding temporarily reduce Indebtedness under the Credit Agreement (and, in the case of the repayment of the a revolving credit facility under the Credit Agreementfacility, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making . Each Net Proceeds Offer will be mailed to holders of Notes as shown on the Offer to Purchase below,
register of holders of Notes within 270 days, will specify the purchase date (ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall which will be treated as a permitted application of the Net Cash Proceeds no earlier than 30 days nor later than 45 days from the date of such commitment; provided that (xnotice is mailed) such investment is consummated within 180 days of and will otherwise comply with the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period procedures set forth in clause (x) the Indenture. Upon receiving notice of a Net Proceeds Offer, holders of Notes may elect to tender their Notes in whole or such binding commitment is terminated, in part in integral multiples of $1,000. To the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount extent holders of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and properly tender Notes in an aggregate principal amount in excess exceeding the applicable Net Proceeds Offer, such Notes of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount tendering holders will be repurchased on a pro rata basis to (based upon the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interesttendered). Upon completion of the Offer to Purchase, Excess Proceeds The Company will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase repurchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflicta Net Proceeds Offer.
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any Restricted Subsidiary to, make any Asset Sale unless (i) the following conditions are met:
Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the Fair Market Value (aas evidenced by a resolution of the Board of Directors set forth in an Officers' Certificate delivered to the Trustee) of the assets or other property sold or disposed of in the Asset Sale is for at least Fair Market Value; and
and (bii) at least 75% of the such consideration received by the Company or its Restricted Subsidiaries consists of either cash or Cash Equivalents; provided provided, however, that for purposes of this clause Section 4.16, "cash" shall include (2), each of the following shall be considered cash or Cash Equivalents:
(ix) the assumption by the purchaser amount of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) any Indebtedness (other than Subordinated Debt or other obligations or liabilities any Indebtedness that is by its terms subordinated in right of payment to the Notes) of the Company or a such Restricted Subsidiary pursuant as shown on the Company's or such Restricted Subsidiary's most recent balance sheet or in the notes thereto that is assumed by the transferee of any such assets or other property in such Asset Sale (and excluding any liabilities that are incurred in connection with or in anticipation of such Asset Sale), but only to operation the extent that such assumption is effected on a basis such that there is no further recourse to the Company or any of law or a customary novation agreement,
the Restricted Subsidiaries with respect to such liabilities and (iiy) Additional Assets,
(iii) instruments, any notes, obligations or securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event converted within 90 60 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received, and).
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(cb) Within 360 180 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Company may elect to apply the Net Cash Proceeds may be used:
from such Asset Sale to (ia) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Senior Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to and/or (b) make an acquisition referred to investment in, or acquire assets and properties that will be used in, the business of the Company and the Restricted Subsidiaries existing on the Issue Date or in clause (ii) or (iii) above shall be treated as a permitted businesses reasonably related thereto. Pending the final application of the any such Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09Proceeds, the Company or any Restricted Subsidiary may use temporarily reduce Indebtedness of the Company under any New Credit Facility or temporarily invest such Net Cash Proceeds in any Investments described under clauses (i) through (iii) of the definition of Permitted Investments. Any Net Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to not applied or invested as provided in the first sentence of this Section 4.09(c)4.16(b) within 180 days of such Asset Sale will be deemed to constitute "Excess Proceeds."
(dc) When Each date that the aggregate amount of Net Cash Excess Proceeds from in respect of which an Asset Sales Sale Offer (as defined below) has not applied been made exceeds $5.0 million shall be deemed an "Asset Sale Offer Trigger Date." As soon as practicable, but in no event later than 20 business days after each Asset Sale Offer Trigger Date, the Company shall commence an offer (an "Asset Sale Offer") to purchase the maximum principal amount of Notes (and, if the Asset Sale Offer Purchase Date occurs during the period following the immediately preceding Interest Payment Date to and including the next PIK Interest Payment Date, any Additional PIK Notes that would be issuable on such PIK Interest Payment Date pursuant to (and within Section 2.3 hereof) that may be purchased out of the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), . Any Notes to be purchased pursuant to an Asset Sale Offer shall be purchased pro rata based on the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes outstanding, and (y) the denominator of which is all Notes shall be purchased at an offer price in cash in an amount equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof, plus accrued interest toand unpaid interest, but excluding if any, to the date of purchase. If To the Offer extent that any Excess Proceeds remain after completion of an Asset Sale Offer, the Company may use the remaining amount to Purchase pay Indebtedness for money borrowed (other than Junior PIK Indebtedness) and, if any Excess Proceeds remain after the payment in full of such Indebtedness, for general corporate purposes otherwise permitted by this Indenture. In the event that the Company is for less than all prohibited under the terms of any agreement governing outstanding Senior Debt of the Company from repurchasing Notes with Excess Proceeds pursuant to an Asset Sale Offer as set forth in the first sentence of this Section 4.16(c), the Company shall promptly use all Excess Proceeds to permanently reduce such outstanding Senior Debt of the Company. Upon the consummation of any Asset Sale Offer, the amount of Excess Proceeds shall be deemed to be reset to zero.
(d) Notice of an Asset Sale Offer shall be mailed, by first-class mail (with a copy to the Trustee), by the Company not later than the 20th business day after the related Asset Sale Offer Trigger Date to each holder of Notes at such holder's registered address, stating: (i) that an Asset Sale Offer Trigger Date has occurred and that the Company is offering to purchase the maximum principal amount of Notes (including any Additional PIK Notes that would be issuable on the next PIK Interest Payment Date pursuant to Section 2.3 hereof) that may be purchased out of the Excess Proceeds (to the extent provided in the immediately preceding paragraph), at an offer price in cash in an aggregate amount equal to 100% of the principal amount in excess thereof, plus accrued and unpaid interest, if any, to the date of the purchase (the "Asset Sale Offer Purchase Date"), which shall be a business day, specified in such notice, that is not earlier than 30 days or later than 60 days from the date such notice is mailed, (ii) the amount are of accrued and unpaid interest, if any, on the Notes (including any amounts that would be payable in respect of any Additional PIK Notes that would be issuable on the next PIK Interest Payment Date pursuant to Section 2.3 hereof) as of the Asset Sale Offer Purchase Date, (iii) that any Note not tendered and not withdrawn will continue to accrue interest, (iv) that, unless the Company defaults in the payment of the purchase price for the Notes payable pursuant to the offerAsset Sale Offer, any Notes accepted for payment pursuant to the Asset Sale Offer shall cease to accrue interest after the Asset Sale Offer Purchase Date (excluding any Additional PIK Notes that would be issuable on the next PIK Interest Payment Date pursuant to Section 2.3 hereof), (v) that Holders electing to have a Note purchased pursuant to a Asset Sale Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day prior to the Asset Sale Offer Purchase Date, (vi) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Asset Sale Offer Purchase Date, a facsimile transmission or letter setting forth the name of the Holder, the Issuers shall principal amount of the Notes the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased, (vii) that Holders whose Notes having an aggregate are purchased only in part will be issued new Notes in a principal amount equal to the unpurchased portion of the Notes surrendered; provided, however, that each Note purchased and each new Note issued shall be in an original principal amount of $1,000 or integral multiples thereof (or if the Notes purchased were issued in lesser denominations, such lesser denomination), and (viii) such other information as may be required by applicable laws and regulations.
(e) On the Asset Sale Offer Purchase Date, the Company will (i) accept for payment the maximum principal amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer that can be purchased out of Excess Proceeds from such Asset Sale that are to be applied to an Asset Sale Offer, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the aggregate purchase price of all Notes or portions thereof accepted for payment, (iii) deposit with the Paying Agent an amount in cash sufficient to pay the aggregate purchase price of any Additional PIK Notes that would be issuable on the next PIK Interest Payment Date pursuant to Section 2.3 hereof, and (iv) deliver or cause to be delivered to the Trustee all Notes tendered pursuant to the Asset Sale Offer. If less than all Notes tendered pursuant to the Asset Sale Offer are accepted for payment by the Company for any reason consistent with this Indenture, selection of the Notes to be purchased by the Company shall be in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not so listed, on a pro rata basis to the extent practicableor by lot; provided, with adjustments by the Company so however, that Notes accepted for payment in part shall only Notes be purchased in integral multiples of $1,000 1,000, and provided further, that if all of a Holder's Notes are to be purchased, an amount shall be retained by the Paying Agent to purchase any Additional PIK Notes that would be issuable to the Holder on the next PIK Interest Payment Date pursuant to Section 2.3 hereof. The Paying Agent shall promptly mail to each holder of Notes or portions thereof accepted for payment an amount equal to the purchase price for such Notes plus accrued and unpaid interest, if any, thereon, and the Trustee shall promptly authenticate and mail to such holder of Notes accepted for payment in part a new Note equal in principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and to any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the unpurchased portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zeroNotes, and any Excess Proceeds remaining Note not accepted for payment in whole or in part shall be promptly returned to the holder of such Note. On and after consummation an Asset Sale Offer Purchase Date, interest will cease to accrue on the Notes or portions thereof accepted for payment (excluding the interest payable under Section 2.3 on any Additional PIK Notes that would be issuable on the next PIK Interest Payment Date), unless the Company defaults in the payment of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenturepurchase price therefor. The Issuers shall Company will publicly announce the results of the Asset Sale Offer on or as soon as practicable after the Asset Sale Offer Purchase Date.
(f) This Section 4.16 will not apply to a transaction consummated in compliance with Article Five.
(g) The Company will comply with the applicable tender offer rules, including the requirements of Section 14(e) and Rule 14e-1 under the Exchange Act Act, and any all other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations in connection with any Asset Sale Offer and shall not will be deemed not to have breached their obligations be in violation of any of the covenants under this Section 4.09 or Section 3.02 by virtue of Indenture to the extent such conflictcompliance is in conflict with such covenants.
Appears in 1 contract
Limitation on Asset Sales. The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(ai) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company's senior management or, in the case of an Asset Sale in excess of $5.0 million, the Board of Directors of the Company);
(bii) at least 75% of the consideration received by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of (x) cash or Cash Equivalents, (y) properties and assets to be owned by the Company or any of its Restricted Subsidiaries and used in a Permitted Business or (z) Capital Stock in one or more Persons engaged in a Permitted Business that are or thereby become Restricted Subsidiaries of the Company, and, in each case, such consideration is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notessheet) of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Securities) that are assumed by the transferee of law or a customary novation agreement,
any such assets, and (iib) Additional Assets,
(iii) instruments, notes, securities any notes or other obligations securities received by the Company or any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, within 180 days after such Asset Sale (to the extent of the cash or Cash Equivalents actually so received, ) shall be deemed to be cash for the purposes of this provision only; and
(iviii) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either:
(A) to prepay any Designated Non-Applicable Indebtedness and, in the case of any such Applicable Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility (or effect a permanent reduction in availability under such revolving credit facility, regardless of the fact that no prepayment is required);
(B) to make an Investment (x) in properties and assets that replace the properties and assets that were the subject of such Asset Sale, (y) in properties and assets that will be used in a Permitted Business or (z) permitted by clause (1) of the definition of Permitted Investments (collectively, "Replacement Assets"); or
(C) a combination of prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B). Pending the final application of the Net Cash Consideration received Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce Pari Passu Indebtedness (or, in the case of an Asset Sale by a Restricted Subsidiary, Indebtedness of a Restricted Subsidiary) or otherwise invest such Net Cash Proceeds in any manner not prohibited by this Indenture. On the 361st day after an Asset Sale or such earlier date, if any, as the senior management or the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each, a "Net Proceeds Offer Trigger Date"), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding paragraph (each a "Net Proceeds Offer Amount") shall be applied by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred offer to in clause purchase (iithe "Net Proceeds Offer") or on a date (iiithe "Net Proceeds Offer Payment Date") above shall be treated as not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, from all Holders on a permitted application pro rata basis, that amount of Securities equal to the Net Proceeds Offer Amount at a price equal to 100% of the Net Cash Proceeds from principal amount of the Securities to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase; provided, however, that if the Company so elects (or is required by the terms of any Applicable Pari Passu Indebtedness), such commitment; provided that (x) Net Proceeds Offer may be made ratably to purchase the Securities and such investment is consummated within 180 days of the end of the 360Applicable Pari Passu Indebtedness. If at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds thereof shall be applied in accordance with this covenant. The Company may defer the Net Proceeds Offer until there is an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million resulting from an one or more Asset Sale for general corporate purposes Sales (including a reduction at which time, the entire unutilized Net Proceeds Offer Amount, and not just the amount in borrowings under any revolving credit facility) prior excess of $10.0 million, shall be applied as required pursuant to the end preceding paragraph). In the event of the 360-day period referred transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.1, which transaction does not constitute a Change of Control, the first sentence successor corporation shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section, and shall comply with the provisions of clause (iii) of this Section 4.09(c).
(d) When with respect to such deemed sale as if it were an Asset Sale. In addition, the aggregate amount fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds from Asset Sales not applied for purposes of this Section 4.18. Notice of each Net Proceeds Offer pursuant to (this Section 4.18 shall be mailed or caused to be mailed, by first class mail, by the Company within 25 days following the applicable Net Proceeds Offer Trigger Date to all Holders at their last registered addresses, with a copy to the Trustee. A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law. The notice shall contain all instructions and within materials necessary to enable such Holders to tender Securities pursuant to the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), Net Proceeds Offer and shall state the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal tofollowing terms:
(i) accumulated Excess Proceedsthat Holders may elect to have their Securities purchased by the Company either in whole or in part (subject to prorationing as hereinafter described in the event the Net Proceeds Offer is oversubscribed) in integral multiples of $1,000 of principal amount, multiplied byat the applicable purchase price;
(ii) that the Net Proceeds Offer is being made pursuant to this Section 4.18 and that all Securities tendered will be accepted for payment; provided, however, that if the principal amount of Securities tendered in the Net Proceeds Offer exceeds the aggregate amount of the Net Proceeds Offer Amount, the Company shall select the Securities to be purchased on a fraction pro rata basis (xbased on amounts tendered);
(iii) the numerator purchase price (including the amount of accrued interest, if any) and the purchase date (which is equal shall be no earlier than 30 days nor later than 60 days from the Net Proceeds Offer Trigger Date, other than as may be required by applicable law);
(iv) that any Security not tendered will continue to accrue interest;
(v) that, unless the Company defaults in making payment therefor, any Security accepted for payment pursuant to the outstanding aggregate Net Proceeds Offer shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(vi) that Holders electing to have a Security purchased pursuant to the Net Proceeds Offer will be required to surrender the Security, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Security completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Net Proceeds Offer Payment Date;
(vii) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Net Proceeds Offer Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes Security the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Security purchased; and
(yviii) the denominator of which is that Holders whose Securities are purchased only in part will be issued new Securities in a principal amount at maturity equal to the outstanding aggregate principal amount unpurchased portion of the Notes and all Debt secured by Liens on Securities surrendered. On or before the Collateral ranking pari passu with Net Proceeds Offer Payment Date, the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company shall (i) accept for payment Securities or portions thereof tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offerNet Proceeds Offer, (ii) deposit with the Issuers Paying Agent U.S. Legal Tender in immediately available funds sufficient to pay the purchase price, plus accrued interest, if any, of all Securities to be purchased and (iii) deliver to the Trustee Securities so accepted together with an Officers' Certificate stating the Securities or portions thereof being purchased by the Company. The Paying Agent shall purchase Notes having promptly mail to the Holders of Securities so accepted payment in an aggregate principal amount equal to the purchase amount on a pro rata basis to price, plus accrued interest, if any, thereon set forth in the extent practicable, with adjustments notice of such Net Proceeds Offer. Any Security not so accepted shall be promptly mailed by the Company so to the Holder thereof. For purposes of this Section 4.18, the Trustee shall act as the Paying Agent. Any amounts remaining after the purchase of Securities pursuant to a Net Proceeds Offer shall be returned by the Trustee to the Company. To the extent that only Notes in multiples of $1,000 principal amount (and in a minimum the aggregate amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect the Securities tendered pursuant to a PIK Note Net Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use such excess Net Proceeds Offer Amount for general corporate purposes or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose other purposes not otherwise prohibited by this Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero. The Issuers shall Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase repurchase of the Notes Securities pursuant to an Offer to Purchase pursuant to this Section 4.09a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09 or Section 3.024.18, the Issuers Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their its obligations under this Section 4.09 or Section 3.02 4.18 by virtue thereof. This covenant and other provisions contained in this Indenture relating to the Company's obligation to make a Net Proceeds Offer may be waived or modified with the written consent of such conflictthe Holders of a majority in principal amount of the Securities.
Appears in 1 contract
Sources: Indenture (RPP Capital Corp)
Limitation on Asset Sales. (A) The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Board of Directors of the Company);
(b2) at least 75% of the consideration received by the Company or its Restricted Subsidiaries consists Subsidiary, as the case may be, from such Asset Sale shall be in the form of cash or Cash Equivalents; provided that for purposes of this clause (2), each of the following Equivalents and shall be considered cash or Cash Equivalents:
received at the time of such disposition; provided, however, that the amount of (ia) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s 's or such Restricted Subsidiary's most recent balance sheet or in the footnotes notes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a any Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation of law the Notes) that are assumed by the transferee in such Asset Sale and from which the Company or a customary novation agreement,
such Restricted Subsidiary is released and (iib) Additional Assets,
(iii) instruments, any notes, securities or other obligations received by the Company or by any such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, immediately converted by the Company or by such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the into cash or Cash Equivalents actually so received, shall be deemed to be cash for purposes of this provision; and
(iv3) any Designated Non-Cash Consideration received by upon the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value consummation of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds may be usedrelating to such Asset Sale within 360 days of receipt thereof either:
(a) to pay (i) to permanently repay (A) Debt outstanding Indebtedness under the Credit Agreement (and, in the case of the repayment of the any such Indebtedness under any revolving credit facility facility, effect a corresponding permanent reduction in the availability under the Credit Agreement, to permanently reduce the commitment thereunder by such amountrevolving credit facility) or (B) the Notes and any Debt secured by Liens other Indebtedness ranking pari passu with the Liens securing Notes or Guarantees and (ii) in the Notes (case of an Asset Sale by a Restricted Subsidiary that is not a Guarantor, Indebtedness of such Restricted Subsidiary; provided, however, that if any) through making the Company repays such other pari passu Indebtedness it must make an equal and ratable Offer to Purchase belowall holders of Notes as provided in the following paragraph,
(ii) to acquire Additional Assets; or
(iiib) to make capital expenditures an Investment in a Permitted Business properties and assets that replace the properties and assets that were the subject of such Asset Sale or in properties and assets that will be used in the business of the Company and its Restricted Subsidiaries as existing on the Issue Date or one or more Restricted Subsidiaries; provided that in businesses reasonably related thereto ("Replacement Assets"), and/or
(c) a binding commitment to make an acquisition referred to in clause combination of prepayment and investment permitted by the foregoing clauses (ii3)(a) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c3)(b).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale is for at least Fair Market Value; andequal to the fair market value of the assets sold or otherwise disposed of (as determined in good faith by the Company’s Board of Directors);
(b2) at least 75% of the consideration received by the Company or its such Restricted Subsidiaries consists of Subsidiary, as the case may be, from such Asset Sale shall be cash or Cash EquivalentsEquivalents and is received at the time of such disposition; provided that for purposes the amount of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(ix) the assumption by the purchaser of Debt or other obligations or any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes notes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a such Restricted Subsidiary pursuant (other than liabilities that are by their terms subordinated to operation the Notes and other than liabilities consisting of law Disqualified Capital Stock) (i) that are assumed by the transferee of any such assets and from which the Company and its Restricted Subsidiaries are unconditionally released or a customary novation agreement,
(ii) Additional Assets,
in respect of which neither the Company nor any Restricted Subsidiary following such sale has any obligation and (iiiy) instruments, notes, securities any notes or other obligations received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any no event within 90 more than 60 days of the closingafter receipt, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, Equivalents (to the extent of the cash or Cash Equivalents actually so received), shall be deemed to be cash for purposes of this provision; and
(iv3) upon the consummation of an Asset Sale, the Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within 360 days of receipt thereof either:
(a) to repay any Obligations under (y) the Senior Credit Facilities and/or interest rate protection, currency and other hedging agreements permitted under the Senior Credit Facilities or (z) any Designated Non-other secured Indebtedness (other than (1) Subordinated Obligations, (2) Equal Lien Indebtedness and (3) Indebtedness secured by Liens junior in priority to Equal Lien Indebtedness) and, in the case of any such Indebtedness under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility;
(b) to reinvest in Productive Assets (and to the extent such reinvestment constitutes an Investment, such reinvestment complies with Section 4.8); or
(c) a combination of repayment and investment permitted by the foregoing clauses (3)(a) and (3)(b). On the 361st day after an Asset Sale or such earlier date, if any, as the Board of Directors of the Company or of such Restricted Subsidiary determines not to apply the Net Cash Consideration received Proceeds relating to such Asset Sale as set forth in clauses (3)(a), (3)(b) and (3)(c) of the immediately preceding sentence (each, a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (3)(a), (3)(b) and (3)(c) of the immediately preceding sentence (each a “Net Proceeds Offer Amount”) shall be applied by the Company or such Restricted Subsidiary in to make an offer to purchase for cash (the Asset Sale having an aggregate Fair Market Value“Net Proceeds Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, taken together with from all other Designated Non-Cash Consideration received pursuant Holders and holders of Equal Lien Indebtedness on a pro rata basis, that amount of Notes and Equal Lien Indebtedness (if such Equal Lien Indebtedness provides for such a repurchase offer equal to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) Offer Amount at a price in cash equal to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case 100% of the repayment principal amount of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (Equal Lien Indebtedness to be purchased, plus accrued and unpaid interest thereon, if any) through making the Offer , to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitmentpurchase; provided provided, however, that (x) such investment is consummated within 180 days of the end of the 360if at any time any non-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, cash consideration received by the Company or any Restricted Subsidiary of the Company, as the case may use be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest, dividends or other earnings received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder as of the date of such conversion or disposition and the Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not thereof shall be applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicable, with adjustments by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflictcovenant.
Appears in 1 contract
Sources: Indenture (Webcraft LLC)
Limitation on Asset Sales. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any consummate an Asset Sale unless the following conditions are metunless:
(a1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of the Asset Sale is for at least equal to the Fair Market Value; andValue of the assets sold or otherwise disposed of;
(b2) at least 75% (or 100% in the case of an Asset Sale of Collateral) of the consideration received for the assets sold or disposed of by the Company or its the Restricted Subsidiaries consists Subsidiary, as the case may be, in the Asset Sale shall be in the form of cash any one or Cash Equivalents; provided that for purposes of this clause (2), each more of the following shall be considered cash or Cash Equivalentsfollowing:
(i) cash or Cash Equivalents;
(ii) the assumption at the time of such Asset Sale by the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the NotesIndebtedness) of the Company or and its Restricted Subsidiaries owed to Persons other than Affiliates of the Company as a result of which the Company and the Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,Subsidiaries are no longer obligated with respect thereto;
(iii) instruments, notes, marketable securities or other obligations received by the Company or and its Restricted Subsidiaries at the time of such Restricted Subsidiary from the purchaser Asset Sale that are promptly, but in any event converted into cash or Cash Equivalents by the Company and its Restricted Subsidiaries within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, andAsset Sale;
(iv) any Designated Non-Cash Consideration received by the Company assets (other than Capital Stock or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(c) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above shall be treated current assets as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof determined in accordance with this Section 4.09GAAP, except for current assets related to, and acquired in connection with, the acquisition of a business or of assets other than current assets) to be used by the Company or any Restricted Subsidiary in a Permitted Business (provided that any assets so acquired in connection with an Asset Sale of Collateral shall also constitute Collateral); or
(v) in the case of a sale or other disposition of Capital Stock of a Person other than a Subsidiary of the Company, Capital Stock of another Person that is not a Subsidiary of the Company immediately prior to such sale or other disposition; and
(3) if such Asset Sale is of Collateral, it complies with the applicable provisions of the Security Documents.
(b) The Company or such Restricted Subsidiary, as the case may use any be, may apply the Net Cash Proceeds from an of any such Asset Sale for general corporate purposes (including a reduction in borrowings under within 300 days thereof to any revolving credit facility) prior to the end one or more of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal tofollowing:
(i1) accumulated Excess Proceedsto the extent such Asset Sale is of assets or property that do not constitute Collateral, multiplied byto repay Pari Passu Indebtedness of the Company or any Note Guarantor or Indebtedness of any Restricted Subsidiary that is not a Note Guarantor, in each case for borrowed money or constituting a Capitalized Lease Obligation and permanently reduce the commitments with respect thereto without Refinancing,
(ii2) a fraction (x) the numerator of which is equal to repay or repurchase and permanently reduce commitments with respect thereto without Refinancing Notes and, to the outstanding aggregate principal amount extent such Asset Sale is of assets or property that do not constitute Collateral, other Pari Passu Indebtedness of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed Company or tendered any Note Guarantor for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued interest to, but excluding the date of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall purchase Notes having an aggregate principal amount equal to the purchase amount money borrowed on a pro rata basis based on their respective aggregate principal amounts, or
(3) (i) to make capital expenditures or purchase from a Person other than the extent practicableCompany and its Restricted Subsidiaries assets (other than Capital Stock or current assets as determined in accordance with GAAP, with adjustments except for current assets related to, and acquired in connection with, the acquisition of a business or of assets other than current assets) to be used by the Company so that only Notes in multiples of $1,000 principal amount (and or any Restricted Subsidiary in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been madePermitted Business, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict.or
Appears in 1 contract
Limitation on Asset Sales. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiary Subsidiaries to, make any Asset Sale (including by operation of or as a result of an LLC Division) unless (i) the following conditions are met:
Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the fair market value (adetermined by the Company in good faith as of the date the Company enters into a definitive agreement relating to such Asset Sale) of the assets or other property sold or disposed of in the Asset Sale is for at least Fair Market Value; and
and (bii) except (x) in the case of a Permitted Asset Swap or (y) if such Asset Sale has a purchase price of less than $100.0 million, at least 75% of such consideration for such Asset Sale, together with all other Asset Sales since the consideration received by Escrow Release Date (on a cumulative basis), is in the Company or its Restricted Subsidiaries consists form of cash or Cash EquivalentsEquivalents or assets used or useful in the business of the Company; provided that for purposes of this clause Section 4.14 “cash” shall include (2), each A) the amount of any liabilities (other than liabilities that are by their terms subordinated to the Notes or any Subsidiary Guarantee) of the following shall be considered cash Company or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities such Restricted Subsidiary (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes notes thereto) that are assumed by the transferee in connection with such assets or other property in such Asset Sale (other than Subordinated Debt and excluding any liabilities that are incurred in connection with or in anticipation of such Asset Sale), but only to the extent that there is no further recourse to the Company or any of its Subsidiaries with respect to such liabilities; (B) any securities, notes or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations assets received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, or by their terms are required to be satisfied for cash or Cash Equivalents (to the extent of the cash or Cash Equivalents actually so received), and
in each case, within 180 days following the closing of such Asset Sale; and (ivC) any Designated Non-Cash Noncash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Valuefair market value that, when taken together with all other Designated Non-Cash Noncash Consideration previously received pursuant to this clause (d) that is at that time and then outstanding, does not to exceed the greater of (x) $10.0 120.0 million per fiscal year and (y) $30.0 million in 20.0% of L8QA Consolidated EBITDA at the aggregate since time of the Issue Date receipt of such Designated Noncash Consideration (with the Fair Market Value fair market value of each item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value);. Notwithstanding clause (ii) of this Section 4.14(a), (a) all or a portion of the consideration in connection with any such Asset Sale may consist of all or substantially all of the assets or a majority of the Voting Stock of an existing television or radio business, franchise or station or digital business (whether existing as a separate entity, subsidiary, division, unit or otherwise) or any other Similar Business and (b) the Company may, and may permit its Subsidiaries to, issue shares of Capital Stock in a Qualified Joint Venture to a Qualified Joint Venture Partner without regard to clause (ii) of this Section 4.14(a); provided that, in the case of any of (a) or (b) of this sentence after giving effect to any such Asset Sale and related acquisition of assets or Voting Stock, (x) no Default or Event of Default shall have occurred or be continuing; and (y) the Net Proceeds of any such Asset Sale, if any, are applied in accordance with this Section 4.14.
(cb) Within 360 450 days after the later of (A) the date of any Asset Sale and (B) the receipt of any Net Cash Proceeds of such Asset Sale (the “Asset Sale Proceeds Application Period”), the Company or such Restricted Subsidiary, at its option, may elect to apply or cause to be applied the Net Proceeds from an such Asset Sale, the Net Cash Proceeds may be used:
(i) to permanently repay the extent such Net Proceeds are from an Asset Sale of Collateral, to repay: (A) Debt outstanding Obligations under the Notes, (B) Obligations under the Senior Credit Agreement (Facilities and, in the case of revolving obligations (other than obligations in respect of any asset-based credit facility), to correspondingly reduce commitments with respect thereto and/or (C) First Lien Obligations (other than the Notes or Obligations under the Senior Credit Facilities) and, in the case of revolving obligations (other than obligations in respect of any asset-based credit facility), to correspondingly reduce commitments with respect thereto; provided that in the case of any repayment pursuant to this clause (C), the Company or such Restricted Subsidiary will either (I) reduce Obligations under the Notes on a pro rata basis with such other First Lien Obligations by, at its option, (x) redeeming Notes pursuant to Section 3.01 or (y) purchasing Notes through open-market purchases or in privately negotiated transactions at market prices (which may be below par), or (II) make an offer (in accordance with the procedures set forth below for a Collateral Asset Sale Offer) to all Holders to purchase their Notes on a ratable basis with such other First Lien Obligations for no less than 100% of the revolving credit facility under principal amount thereof, plus the Credit Agreementamount of accrued but unpaid interest, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making , thereon up to the Offer principal amount of Notes to Purchase below,be repurchased;
(ii) to acquire Additional Assetsthe extent such Net Proceeds are from an Asset Sale that does not constitute Collateral, to repay: (A) Obligations under Secured Indebtedness (other than Indebtedness owed to the Company or a Restricted Subsidiary), and, in the case of revolving obligations (other than obligations in respect of any asset-based credit facility), to correspondingly reduce commitments with respect thereto and/or (B) Obligations under any unsecured Indebtedness of the Company or any Restricted Subsidiary that ranks pari passu in right of payment to the Notes (“Pari Passu Indebtedness”) and, in the case of revolving obligations (other than obligations in respect of any asset-based credit facility), to correspondingly reduce commitments with respect thereto; orprovided that in the case of any repayment pursuant to this clause (B), the Company or such Restricted Subsidiary will either (I) reduce Obligations under the Notes on a pro rata basis with such other ▇▇▇▇ ▇▇▇▇▇ Indebtedness by, at its option, (x) redeeming Notes pursuant to Section 3.01 or (y) purchasing Notes through open-market purchases or in privately negotiated transactions at market prices (which may be below par), or (II) make an offer (in accordance with the procedures set forth below for an Asset Sale Offer) to all Holders to purchase their Notes (which may be on a ratable basis with such other Pari Passu Indebtedness) for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased; provided that to the extent the Company or any Restricted Subsidiary makes an offer to redeem, prepay, repay or purchase any Obligations pursuant to any of the foregoing clauses (i) and (ii) at a price of no less than 100% of the principal amount thereof, to the extent the relevant creditors do not accept such offering, the Company and the Restricted Subsidiaries will be deemed to have applied an amount of the Net Proceeds equal to such amount not so accepted in such offer, and such amount shall not increase the amount of Collateral Excess Proceeds or Excess Proceeds (and such amount shall instead constitute Declined Collateral Proceeds or Declined Proceeds, as the case may be);
(iii) to invest in the business of the Company and its Subsidiaries, including any investment in Additional Assets;
(iv) to make capital expenditures in or that are used or useful in a Permitted Similar Business or to make capital expenditures for maintenance, repair or improvement of existing assets in accordance with the terms of this Indenture; provided that the Company may elect to deem Investments or capital expenditures within the scope of the Company foregoing clauses (iii) or one (iv), as applicable, that occur prior to the receipt of the Net Proceeds to have been made in accordance with such clauses (iii) or more Restricted Subsidiaries(iv) so long as such deemed Investments or capital expenditures shall have been made no earlier than the earlier of (x) the execution of a definitive agreement relating to such Asset Sale and (y) the consummation of such Asset Sale; and/or
(v) any combination of the foregoing; provided that a binding commitment to make an acquisition referred to in clause (ii) or (iii) above letter of intent shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided commitment or letter of intent so long as the Company or a Restricted Subsidiary enters into such commitment with the good faith expectation that (x) such investment is consummated Net Proceeds will be applied to satisfy such commitment within 180 days of the end expiration of the 360-day Asset Sale Proceeds Application Period (an “Acceptable Commitment”) and such Net Proceeds are actually applied substantially in such manner within 180 days of the expiration of the Asset Sale Proceeds Application Period (the period referred from the consummation of the Asset Sale to such date, the “First Commitment Application Period”) or, in the first sentence event any Acceptable Commitment is later terminated or cancelled prior to the application of this paragraph such Net Proceeds or such Net Proceeds are not so applied within such First Commitment Application Period, then such Net Proceeds shall constitute Collateral Excess Proceeds or Excess Proceeds, as the case may be, unless the Company or such Restricted Subsidiary reasonably intends to enter into another Acceptable Commitment prior to the expiration of the First Commitment Application Period (a “Second Commitment”) and (y) such Net Proceeds are actually applied substantially in such manner within 180 days of the date of entering into the Second Commitment; provided, further, that if any Second Commitment is cancelled or terminated for any reason before such acquisition Net Proceeds are applied or if the date of such Second Commitment is not consummated prior to the date of the expiration of the First Commitment Application Period then such Net Proceeds shall constitute Collateral Excess Proceeds or Excess Proceeds, as the case may be.
(c) Any Net Proceeds from an Asset Sale of Collateral not applied or invested as provided and within the time period set forth in Section 4.14(b) will be deemed to constitute “Collateral Excess Proceeds”; provided that any amount of Net Proceeds offered to Holders of the Notes pursuant to clause (xi)(C)(II) or such binding commitment is terminated, the Net Cash Proceeds of Section 4.14(b) shall not so applied will be deemed to be Excess Proceeds without regard to whether such offer is accepted by any Holders. In no event later than 20 Business Days after any date (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09, the Company or any Restricted Subsidiary may use any Net Cash Proceeds from an a “Collateral Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facilityOffer Trigger Date”) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When that the aggregate amount of Net Cash Collateral Excess Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million 75.0 million, the Company shall commence an offer (a “Excess ProceedsCollateral Asset Sale Offer”) to all Holders of Notes and, if required or permitted by the terms of any other First Lien Obligations or Obligations secured by a Lien permitted under this Indenture on the assets disposed of (which Lien is not subordinate to the Lien of the Notes with respect to the Collateral), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding holders of such other First Lien Obligations and/or other Obligations as selected by the Company, to purchase the maximum aggregate principal amount (or accreted value, as applicable) of the Notes and (y) such other First Lien Obligations and other Obligations that is, with respect to the denominator of which is Notes only, in an amount equal to $1,000, or an integral multiple of $1,000 in excess thereof, that may be purchased out of the outstanding aggregate principal amount Collateral Excess Proceeds at an offer price, in the case of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required only, in cash in an amount equal to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof (or accreted value thereof, if less), plus accrued interest and unpaid interest, if any, to, but excluding excluding, the date fixed for the closing of purchase. If the Offer to Purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the such offer, in accordance with the Issuers shall purchase Notes having an aggregate principal amount equal to procedures set forth in this Indenture, and, in the purchase amount on a pro rata basis to case of such other First Lien Obligations and other Obligations, at the extent practicable, with adjustments offer price required by the Company so that only Notes in multiples of $1,000 principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been madeterms thereof, in denominations of $1.00 and any integral multiple of $1.00 accordance with the procedures set forth in excess thereof the agreement(s) governing such other First Lien Obligations or other Obligations. The Company may satisfy the foregoing obligations with respect to any Net Proceeds from an Asset Sale of Collateral by making a PIK Note Collateral Asset Sale Offer with respect to such Net Proceeds prior to the time period that may be required by this Indenture with respect to all or the portion of a Global Note constituting PIK Interest). Upon completion part of the Offer available Net Proceeds (the “Collateral Advance Portion”) in advance of being required to Purchase, Excess Proceeds will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used for any purpose not otherwise prohibited do so by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to Indenture (an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflict“Collateral Advance Offer”).
Appears in 1 contract
Sources: Indenture (E.W. SCRIPPS Co)
Limitation on Asset Sales. (a) The Company shall not, and shall not permit any Restricted Subsidiary to, make any Asset Sale unless (i) the following conditions are met:
Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the fair market value (aas evidenced by a resolution of the Board of Directors set forth in an Officers' Certificate delivered to the Trustee) of the assets or other property sold or disposed of in the Asset Sale is for at least Fair Market Value; and
and (bii) at least 75% of the such consideration received by the Company or its Restricted Subsidiaries consists of either cash or Cash Equivalents; provided provided, however, that for purposes of this clause Section 4.16, "cash" shall include (2), each of the following shall be considered cash or Cash Equivalents:
(ix) the assumption by the purchaser amount of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) any Indebtedness (other than Subordinated Debt or other obligations or liabilities any Indebtedness that is by its terms subordinated in right of payment to the Notes) of the Company or a such Restricted Subsidiary pursuant as shown on the Company's or such Restricted Subsidiary's most recent balance sheet or in the notes thereto that is assumed by the transferee of any such assets or other property in such Asset Sale (and excluding any liabilities that are incurred in connection with or in anticipation of such Asset Sale), but only to operation the extent that such assumption is effected on a basis such that there is no further recourse to the Company or any of law or a customary novation agreement,
the Restricted Subsidiaries with respect to such liabilities and (iiy) Additional Assets,
(iii) instruments, any notes, obligations or securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser such transferee that are promptly, but in any event converted within 90 60 days of the closing, converted by the Company or such Restricted Subsidiary to into cash or Cash Equivalents, (to the extent of the cash or Cash Equivalents actually so received, and).
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(cb) Within 360 270 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Company or the applicable Restricted Subsidiary may elect to apply the Net Cash Proceeds may be used:
from such Asset Sale to (ia) to permanently repay (A) Debt outstanding under the Credit Agreement (and, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Senior Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more any Indebtedness of the applicable Restricted Subsidiaries; provided that a binding commitment to Subsidiary and/or (b) make an acquisition referred to investment in, or acquire assets and properties that will be used in, the business of the Company and the Restricted Subsidiaries existing on the Issue Date or in clause (ii) or (iii) above shall be treated as a permitted businesses reasonably related thereto. Pending the final application of the any such Net Cash Proceeds from the date of such commitment; provided that (x) such investment is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within the period set forth in clause (x) or such binding commitment is terminated, the Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09Proceeds, the Company or any Restricted Subsidiary may use temporarily reduce Indebtedness of the Company under the Senior Credit Facility or temporarily invest such Net Proceeds in any Investments described under clauses (i) through (iii) of the definition of Permitted Investments. Any Net Cash Proceeds from an Asset Sale for general corporate purposes (including a reduction in borrowings under any revolving credit facility) prior to the end of the 360-day period referred to not applied or invested as provided in the first sentence of this Section 4.09(c)4.16(b) within 270 days of such Asset Sale will be deemed to constitute "Excess Proceeds."
(dc) When Each date that the aggregate amount of Net Cash Excess Proceeds from in respect of which an Asset Sales Sale Offer (as defined below) has not applied been made exceeds $5.0 million shall be deemed an "Asset Sale Offer Trigger Date." As soon as practicable, but in no event later than 20 business days after each Asset Sale Offer Trigger Date, the Company shall commence an offer (an "Asset Sale Offer") to purchase the maximum principal amount of Notes that may be purchased out of the Excess Proceeds. Any Notes to be purchased pursuant to (and within an Asset Sale Offer shall be purchased pro rata based on the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”), the Issuers must, within 30 days, make an offer to purchase, in accordance with Section 3.02, Notes having a principal amount equal to:
(i) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to the outstanding aggregate principal amount of the Notes outstanding, and (y) the denominator of which is all Notes shall be purchased at an offer price in cash in an amount equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount thereof, plus accrued interest toand unpaid interest, but excluding if any, to the date of purchase. If To the Offer to Purchase extent that any Excess Proceeds remain after completion of an Asset Sale Offer, the Company may use the remaining amount for general corporate purposes otherwise permitted by this Indenture. In the event that the Company is for less than all prohibited under the terms of any agreement governing outstanding Senior Debt of the Company from repurchasing Notes with Excess Proceeds pursuant to an Asset Sale Offer as set forth in the first sentence of this Section 4.16(c), the Company shall promptly use all Excess Proceeds to permanently reduce such outstanding Senior Debt of the Company. Upon the consummation of any Asset Sale Offer, the amount of Excess Proceeds shall be deemed to be reset to zero.
(d) Notice of an Asset Sale Offer shall be mailed, by first-class mail (with a copy to the Trustee), by the Company not later than the 20th business day after the related Asset Sale Offer Trigger Date to each Holder of Notes at such Holder's registered address, stating: (i) that an Asset Sale Offer Trigger Date has occurred and that the Company is offering to purchase the maximum principal amount of Notes that may be purchased out of the Excess Proceeds (to the extent provided in the immediately preceding paragraph), at an offer price in cash in an aggregate amount equal to 100% of the principal amount in excess thereof, plus accrued and unpaid interest, if any, to the date of the purchase (the "Asset Sale Offer Purchase Date"), which shall be a business day, specified in such notice, that is not earlier than 30 days or later than 60 days from the date such notice is mailed, (ii) the amount are of accrued and unpaid interest, if any, as of the Asset Sale Offer Purchase Date, (iii) that any Note not tendered and not withdrawn will continue to accrue interest, (iv) that, unless the Company defaults in the payment of the purchase price for the Notes payable pursuant to the offerAsset Sale Offer, any Notes accepted for payment pursuant to the Asset Sale Offer shall cease to accrue interest after the Asset Sale Offer Purchase Date, (v) that Holders electing to have a Note purchased pursuant to a Asset Sale Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day prior to the Asset Sale Offer Purchase Date, (vi) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Asset Sale Offer Purchase Date, a facsimile transmission or letter setting forth the name of the Holder, the Issuers shall principal amount of the Notes the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased, (vii) that Holders whose Notes having an aggregate are purchased only in part will be issued new Notes in a principal amount equal to the unpurchased portion of the Notes surrendered; provided, however, that each Note purchased and each new Note issued shall be in an original principal amount of $1,000 or integral multiples thereof, and (viii) such other information as may be required by applicable laws and regulations.
(e) On the Asset Sale Offer Purchase Date, the Company will (i) accept for payment the maximum principal amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer that can be purchased out of Excess Proceeds from such Asset Sale that are to be applied to an Asset Sale Offer, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the aggregate purchase amount price of all Notes or portions thereof accepted for payment, and (iii) deliver or cause to be delivered to the Trustee all Notes tendered pursuant to the Asset Sale Offer. If less than all Notes tendered pursuant to the Asset Sale Offer are accepted for payment by the Company for any reason consistent with this Indenture, selection of the Notes to be purchased by the Company shall be in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not so listed, on a pro rata basis to the extent practicableor by lot; provided, with adjustments by the Company so however, that Notes accepted for payment in part shall only Notes be purchased in integral multiples of $1,000 1,000. The Paying Agent shall promptly mail to each Holder of Notes or portions thereof accepted for payment an amount equal to the purchase price for such Notes plus accrued and unpaid interest, if any, thereon, and the Trustee shall promptly authenticate and mail to such Holder of Notes accepted for payment in part a new Note equal in principal amount (and in a minimum amount of $1,000) will be purchased (or if a PIK Payment has been made, in denominations of $1.00 and to any integral multiple of $1.00 in excess thereof with respect to a PIK Note or the unpurchased portion of a Global Note constituting PIK Interest). Upon completion of the Offer to Purchase, Excess Proceeds will be reset at zeroNotes, and any Excess Proceeds remaining Note not accepted for payment in whole or in part shall be promptly returned to the Holder of such Note. On and after consummation an Asset Sale Offer Purchase Date, interest will cease to accrue on the Notes or portions thereof accepted for payment, unless the Company defaults in the payment of the Offer to Purchase may be used for any purpose not otherwise prohibited by this Indenturepurchase price therefor. The Issuers shall Company will publicly announce the results of the Asset Sale Offer on or as soon as practicable after the Asset Sale Offer Purchase Date.
(f) This Section 4.16 will not apply to a transaction consummated in compliance with Article Five.
(g) The Company will comply with the applicable tender offer rules, including the requirements of Section 14(e) and Rule 14e-1 under the Exchange Act Act, and any all other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations in connection with any Asset Sale Offer and shall not will be deemed not to have breached their obligations be in violation of any of the covenants under this Section 4.09 or Section 3.02 by virtue of Indenture to the extent such conflictcompliance is in conflict with such covenants.
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Limitation on Asset Sales. The Company shall not, and shall not permit any Restricted Subsidiary to, make in the ordinary course of business or otherwise, sell, lease, convey, transfer or otherwise dispose of any of the Company’s, or of any such Subsidiary’s, assets (including Capital Stock and warrants, options or other rights to acquire Capital Stock) (an “Asset Sale”), other than pursuant to a Permitted Asset Sale or a Limited Permitted Asset Sale, unless the following conditions are met:
(aA) the Asset Sale is for at least Fair Market Value; and
(b) at least 75% of Company receives, or the relevant Subsidiary receives, consideration received by the Company or its Restricted Subsidiaries consists of cash or Cash Equivalents; provided that for purposes of this clause (2), each of the following shall be considered cash or Cash Equivalents:
(i) the assumption by the purchaser of Debt or other obligations or liabilities (as shown on the Company’s most recent balance sheet or in the footnotes thereto) (other than Subordinated Debt or other obligations or liabilities subordinated in right of payment to the Notes) of the Company or a Restricted Subsidiary pursuant to operation of law or a customary novation agreement,
(ii) Additional Assets,
(iii) instruments, notes, securities or other obligations received by the Company or such Restricted Subsidiary from the purchaser that are promptly, but in any event within 90 days of the closing, converted by the Company or such Restricted Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash Equivalents actually so received, and
(iv) any Designated Non-Cash Consideration received by the Company or such Restricted Subsidiary in the Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed (x) $10.0 million per fiscal year and (y) $30.0 million in the aggregate since the Issue Date (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received of such Asset Sale at least equal to the fair market value (including as to the value of all non-cash consideration), as determined in good faith by the Board of Directors of the Company, of the assets subject to such Asset Sale, and without giving effect to subsequent changes in value);
(cB) Within 360 within 365 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Company or the relevant Subsidiary, as the case may be, shall apply all such Net Cash Proceeds may be usedto:
(ia) repay or prepay indebtedness under any Credit Facility secured by a lien on assets of the Company or any Subsidiary;
(b) acquire all or substantially all of the assets of, or any Capital Stock of, a person primarily engaged in a Permitted Business; provided, that in the case of the acquisition of Capital Stock of any Person, such Person is or becomes a Subsidiary of the Company and will be subject to permanently all restrictions described in this First Supplemental Indenture as applying to Subsidiaries of the Company existing on the Issue Date;
(c) make a capital expenditure;
(d) acquire other assets that are not classified as current assets under US GAAP and that are used or useful in a Permitted Business (including, without limitation, Vessels and Related Assets);
(e) repay unsecured senior indebtedness of the Company or any Subsidiary (Aincluding any redemption, repurchase, retirement or other acquisition of the Notes); and
(f) Debt any combination of the transactions permitted by the foregoing clauses (a) through (e), provided, that any sale, assignment, conveyance, transfer or lease of all or substantially all of the Company’s properties and assets to any Person or Persons (whether in a single transaction or a series of related transactions) will be governed by the provisions described under Section 4.01 of this First Supplemental Indenture and Article 5 of the Indenture and not by the provisions of this Section 6.06.
A (1) binding contract to apply the Net Proceeds in accordance with clauses (b) through (d) above shall toll the 365-day period in respect of such Net Proceeds or (2) determination by the Company to apply all or a portion of such Net Proceeds toward the exercise of an outstanding under purchase option contract shall toll the Credit Agreement (and365-day period in respect of such Net Proceeds or portion thereof, in each case, for a period not to exceed 365 days or, in the case of the repayment of the revolving credit facility under the Credit Agreement, to permanently reduce the commitment thereunder by such amount) or (B) the Notes and any Debt secured by Liens ranking pari passu with the Liens securing the Notes (if any) through making the Offer to Purchase below,
(ii) a binding contract to acquire Additional Assets; or
(iii) to make capital expenditures in a Permitted Business of the Company or one or more Restricted Subsidiaries; provided Vessels, until the end of the construction or delivery period specified in such binding contract, as the same may be extended, from the expiration of the aforementioned 365-day period, provided, that a such binding commitment to make an acquisition referred to contract and such determination by the Company, in clause (ii) or (iii) above each case, shall be treated as a permitted application of the Net Cash Proceeds from the date of such commitment; provided that binding contract or determination until and only until the earlier of (x) the date on which such investment acquisition or expenditure is consummated within 180 days of the end of the 360-day period referred to in the first sentence of this paragraph and (y) if such acquisition is not consummated within (i) in the period set forth in clause (x) case of a construction contract or such binding commitment is terminatedany exercised purchase option contract, the date of expiration or termination of such construction contract or exercised purchase option contract and (ii) in all other cases, the 365th day following the expiration of the aforementioned 365-day period. Pending the final application of any Net Cash Proceeds not so applied will be deemed to be Excess Proceeds (as defined below). For the avoidance of doubt, pending application thereof in accordance with this Section 4.09Proceeds, the Company or any Restricted Subsidiary of its Subsidiaries may use apply Net Proceeds to the repayment or reduction of outstanding indebtedness or otherwise invest the Net Proceeds in any Net Cash Proceeds from an manner that is not prohibited by the Indenture. If a Limited Permitted Asset Sale for general corporate purposes (including a reduction in borrowings under occurs at any revolving credit facility) prior to the end of the 360-day period referred to in the first sentence of this Section 4.09(c).
(d) When the aggregate amount of Net Cash Proceeds from Asset Sales not applied pursuant to (and within the time frame set forth in) Section 4.09(c) exceeds $25.0 million (“Excess Proceeds”)time, the Issuers Company must, within 30 daysdays of such Limited Permitted Asset Sale, make pursuant to Article V of this First Supplemental Indenture an offer to purchase, in accordance with Section 3.02, purchase Notes having a principal amount equal to:
to the Excess Proceeds of such Limited Permitted Asset Sale. The price that the Company will be required to pay (ithe “Limited Permitted Asset Sale Purchase Price”) accumulated Excess Proceeds, multiplied by
(ii) a fraction (x) the numerator of which is equal to 101% of the outstanding aggregate principal amount of the Notes and (y) the denominator of which is equal to the outstanding aggregate principal amount of the Notes and all Debt secured by Liens on the Collateral ranking pari passu with the Liens on the Collateral securing the Notes similarly required to be repaidpurchased, redeemed or tendered for in connection with the Asset Sale, rounded down to the nearest $1,000. The purchase price for the Notes will be 100% of the principal amount plus accrued and unpaid interest to, but excluding excluding, the date Limited Permitted Asset Sale Purchase Date, subject to the right of purchaseHolders of record on the relevant Record Date to receive interest due on the relevant Interest Payment Date. If the Offer offer to Purchase purchase is for less than all of the outstanding Notes and Notes in an aggregate principal amount in excess of the purchase amount are tendered and not withdrawn pursuant to the offer, the Issuers shall Company will purchase Notes having an aggregate principal amount equal to the purchase amount on a pro rata basis to the extent practicablebasis, with adjustments by the Company so that only Notes notes in multiples of $1,000 25.00 principal amount (and in a minimum amount of $1,000) will be purchased (purchased. The “Limited Permitted Asset Sale Purchase Date” will be a date specified by the Company that is not less than 20 or if a PIK Payment has been made, in denominations of $1.00 and any integral multiple of $1.00 in excess thereof with respect to a PIK Note or more than 35 calendar days following the portion of a Global Note constituting PIK Interest). Upon completion date of the Offer Limited Permitted Asset Sale notice as described in Article V of this First Supplemental Indenture. Any Notes purchased by the Company pursuant to Purchase, Excess Proceeds such offer to purchase will be reset at zero, and any Excess Proceeds remaining after consummation of the Offer to Purchase may be used paid for any purpose not otherwise prohibited by this Indenture. The Issuers shall comply with the requirements of 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 connection with the purchase of the Notes pursuant to an Offer to Purchase pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with Section 4.09 or Section 3.02, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Section 4.09 or Section 3.02 by virtue of such conflictcash.
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