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INDENTURE
Dated as of September 22, 2004
Among
XXXXXXXXX LUMBER CO. LTD.,
as Issuer,
the Guarantor named herein
and
The Bank of New York,
as Trustee
7 1/4% SENIOR NOTES DUE 2012
AND
SENIOR FLOATING RATE NOTES DUE 2010
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CROSS-REFERENCE TABLE*
Trust Indenture Indenture
Act Section Section
-------------------- -----------
310(a)(1)...................................................................................... 7.10
(a)(2)...................................................................................... 7.10
(a)(3)...................................................................................... N.A.
(a)(4)...................................................................................... N.A.
(a)(5)...................................................................................... 7.10
(b)......................................................................................... 7.10
(c)......................................................................................... N.A.
311(a)......................................................................................... 7.11
(b)......................................................................................... 7.11
(c)......................................................................................... N.A.
312(a)......................................................................................... 2.05
(b)......................................................................................... 12.03
(c)......................................................................................... 12.03
313(a)......................................................................................... 7.06
(b)(1)...................................................................................... N.A.
(b)(2)...................................................................................... 7.07
(c)......................................................................................... 7.06;12.02
(d)......................................................................................... 7.06
314(a)......................................................................................... 4.03;12.02
(b)......................................................................................... N.A.
(c)(1)...................................................................................... 12.04
(c)(2)...................................................................................... 12.04
(c)(3)...................................................................................... N.A.
(d)......................................................................................... N.A.
(e)......................................................................................... 12.05
(f)......................................................................................... N.A.
315(a)......................................................................................... 7.01
(b)......................................................................................... 7.05;12.02
(c)......................................................................................... 7.01
(d)......................................................................................... 7.01
(e)......................................................................................... 6.14
316(a)(last sentence).......................................................................... 2.09
(a)(1)(A)................................................................................... 6.05
(a)(1)(B)................................................................................... 6.04
(a)(2)...................................................................................... N.A.
(b)......................................................................................... 6.07
(c)......................................................................................... 2.12; 9.04
317(a)(1)...................................................................................... 6.08
(a)(2)...................................................................................... 6.12
(b)......................................................................................... 2.04
318(a)......................................................................................... 12.01
(b)......................................................................................... N.A.
(c)......................................................................................... 12.01
N.A. means not applicable.
* This Cross-Reference Table is not part of the Indenture.
TABLE OF CONTENTS
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ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 Definitions...................................................................................1
Section 1.02 Other Definitions............................................................................21
Section 1.03 Incorporation by Reference of Trust Indenture Act............................................22
Section 1.04 Rules of Construction........................................................................22
ARTICLE 2
THE NOTES
Section 2.01 Form and Dating; Terms.......................................................................23
Section 2.02 Execution and Authentication.................................................................24
Section 2.03 Registrar, Paying Agent and Calculation Agent................................................24
Section 2.04 Paying Agent to Hold Money in Trust..........................................................25
Section 2.05 Holder Lists.................................................................................25
Section 2.06 Transfer and Exchange........................................................................25
Section 2.07 Replacement Notes............................................................................36
Section 2.08 Outstanding Notes............................................................................36
Section 2.09 Treasury Notes...............................................................................36
Section 2.10 Temporary Notes..............................................................................36
Section 2.11 Cancellation.................................................................................37
Section 2.12 Defaulted Interest...........................................................................37
ARTICLE 3
REDEMPTION
Section 3.01 Notices to Trustee...........................................................................37
Section 3.02 Selection of Notes to Be Redeemed............................................................38
Section 3.03 Notice of Redemption.........................................................................38
Section 3.04 Effect of Notice of Redemption...............................................................39
Section 3.05 Deposit of Redemption Price..................................................................39
Section 3.06 Notes Redeemed in Part.......................................................................39
Section 3.07 Reserved.....................................................................................39
Section 3.08 Mandatory Redemption.........................................................................39
Section 3.09 Offers to Repurchase.........................................................................40
ARTICLE 4
COVENANTS
Section 4.01 Payment of Notes.............................................................................41
Section 4.02 Maintenance of Office or Agency..............................................................42
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Section 4.03 Reports to Holders...........................................................................42
Section 4.04 Compliance Certificate.......................................................................43
Section 4.05 Taxes........................................................................................43
Section 4.06 Stay, Extension and Usury Laws...............................................................43
Section 4.07 Restricted Payments..........................................................................44
Section 4.08 Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries....................46
Section 4.09 Incurrence of Indebtedness and Issuance of Preferred Stock...................................47
Section 4.10 Asset Sales..................................................................................50
Section 4.11 Transactions with Affiliates.................................................................52
Section 4.12 Liens........................................................................................53
Section 4.13 Payments for Consent.........................................................................54
Section 4.14 Corporate Existence..........................................................................54
Section 4.15 Change of Control............................................................................54
Section 4.16 Additional Subsidiary Guarantees.............................................................55
Section 4.17 Designation of Restricted and Unrestricted Subsidiaries......................................55
Section 4.18 Additional Amounts...........................................................................55
Section 4.19 Limitation on Guarantees by Restricted Subsidiaries..........................................57
Section 4.20 Money for Security Payments to Be Held in Trust..............................................57
Section 4.21 Maintenance of Properties....................................................................58
Section 4.22 Maintenance of Insurance.....................................................................58
Section 4.23 Certain Fall-Away Covenants..................................................................58
ARTICLE 5
SUCCESSORS
Section 5.01 Merger, Amalgamation, Consolidation or Sale of Assets........................................59
Section 5.02 Successor Corporation Substituted............................................................60
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01 Events of Default............................................................................60
Section 6.02 Acceleration.................................................................................62
Section 6.03 Other Remedies...............................................................................63
Section 6.04 Waiver of Past Defaults......................................................................63
Section 6.05 Control by Majority..........................................................................63
Section 6.06 Limitation on Suits..........................................................................63
Section 6.07 Rights of Holders of Notes to Receive Payment................................................64
Section 6.08 Collection Suit by Trustee...................................................................64
Section 6.09 Restoration of Rights and Remedies...........................................................64
Section 6.10 Rights and Remedies Cumulative...............................................................64
Section 6.11 Delay or Omission Not Waiver.................................................................64
Section 6.12 Trustee May File Proofs of Claim.............................................................65
Section 6.13 Priorities...................................................................................65
Section 6.14 Undertaking for Costs........................................................................65
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ARTICLE 7
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TRUSTEE
Section 7.01 Duties of Trustee............................................................................66
Section 7.02 Rights of Trustee............................................................................67
Section 7.03 Individual Rights of Trustee.................................................................68
Section 7.04 Trustee's Disclaimer.........................................................................68
Section 7.05 Notice of Defaults...........................................................................68
Section 7.06 Reports by Trustee to Holders of the Notes...................................................68
Section 7.07 Compensation and Indemnity...................................................................69
Section 7.08 Replacement of Trustee.......................................................................69
Section 7.09 Successor Trustee by Merger, etc.............................................................70
Section 7.10 Eligibility; Disqualification................................................................70
Section 7.11 Preferential Collection of Claims Against Company............................................70
Section 7.12 Appointment of Co-Trustee....................................................................70
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.....................................71
Section 8.02 Legal Defeasance and Discharge...............................................................72
Section 8.03 Covenant Defeasance..........................................................................72
Section 8.04 Conditions to Legal or Covenant Defeasance...................................................73
Section 8.05 Deposited Money and Government Securities to Be Held in Trust; Other
Miscellaneous Provisions..................................................................74
Section 8.06 Repayment to Company.........................................................................74
Section 8.07 Reinstatement................................................................................75
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes..........................................................75
Section 9.02 With Consent of Holders of Notes.............................................................76
Section 9.03 Compliance with Trust Indenture Act..........................................................77
Section 9.04 Revocation and Effect of Consents............................................................77
Section 9.05 Notation on or Exchange of Notes.............................................................77
Section 9.06 Trustee to Sign Amendments, etc..............................................................77
ARTICLE 10
GUARANTEES
Section 10.01 Subsidiary Guarantee.........................................................................78
Section 10.02 Limitation on Guarantor Liability............................................................80
Section 10.03 Execution and Delivery of Subsidiary Guarantee...............................................80
Section 10.04 Guarantors May Consolidate, etc., on Certain Terms...........................................80
Section 10.05 Releases Following Sale of Assets............................................................81
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Section 10.06 Subrogation..................................................................................82
Section 10.07 Benefits Acknowledged........................................................................82
ARTICLE 11
SATISFACTION AND DISCHARGE
Section 11.01 Satisfaction and Discharge...................................................................82
Section 11.02 Application of Trust Money...................................................................83
ARTICLE 12
MISCELLANEOUS
Section 12.01 Trust Indenture Act Controls.................................................................83
Section 12.02 Notices......................................................................................83
Section 12.03 Communication by Holders of Notes with Other Holders of Notes................................85
Section 12.04 Certificate and Opinion as to Conditions Precedent...........................................85
Section 12.05 Statements Required in Certificate or Opinion................................................85
Section 12.06 Rules by Trustee and Agents..................................................................86
Section 12.07 No Personal Liability of Directors, Officers, Employees and Shareholders.....................86
Section 12.08 Governing Law................................................................................86
Section 12.09 Waiver of Jury Trial.........................................................................86
Section 12.10 Force Majeure................................................................................86
Section 12.11 No Adverse Interpretation of Other Agreements................................................86
Section 12.12 Successors...................................................................................86
Section 12.13 Agent for Service; Submission to Jurisdiction; Waiver of Immunities..........................87
Section 12.14 Conversion of Currency.......................................................................87
Section 12.15 Currency Equivalent..........................................................................88
Section 12.16 Severability.................................................................................88
Section 12.17 Counterpart Originals........................................................................88
Section 12.18 Table of Contents, Headings, etc.............................................................88
EXHIBITS
Exhibit A-1 Form of Fixed Rate Note
Exhibit A-2 Form of Floating Rate Note
Exhibit B Form of Certificate of Transfer
Exhibit C Form of Certificate of Exchange
Exhibit D Form of Certificate from Acquiring Institutional Accredited Investor
Exhibit E Form of Notation of Guarantor
Exhibit F Form of Supplemental Indenture to Be Delivered by Subsequent Guarantors
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INDENTURE dated as of September 22, 2004 among Xxxxxxxxx
Lumber Co. Ltd., a British Columbia corporation (the "Company"), Xxxxxxxxx
Engineered Corp., as guarantor, and The Bank of New York, a New York banking
corporation, as Trustee.
The Company has duly authorized the creation of an issue of
(i) US$275,000,000 aggregate principal amount of 7 1/4% Senior Notes due 2012
(the "Fixed Rate Notes") and (ii) US$175,000,000 aggregate principal amount of
Senior Floating Rate Notes due 2010 (the "Floating Rate Notes" and, together
with the Fixed Rate Notes, the "Notes"). Each of the Company and Xxxxxxxxx
Engineered Corp. has duly authorized the execution and delivery of this
Indenture.
The Company, the Guarantor and the Trustee agree as follows
for the benefit of each other and for the equal and ratable benefit of the
Holders of the Notes.
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 Definitions.
"144A Global Note" means a Global Note substantially in the
form of Exhibit A-1 or Exhibit A-2 hereto, as the case may be, bearing the
Global Note Legend and the Private Placement Legend and deposited with or on
behalf of, and registered in the name of, the Depositary or its nominee that
will be issued in a denomination equal to the outstanding principal amount of
the Notes sold in reliance on Rule 144A.
"Acquired Indebtedness" means, with respect to any specified
Person:
(1) Indebtedness of any other Person existing at the time such
other Person is merged with or into or became a Subsidiary of such
specified Person, whether or not such Indebtedness is incurred in
connection with, or in contemplation of, such other Person merging with
or into, or becoming a Subsidiary of, such specified Person; and
(2) Indebtedness secured by a Lien encumbering any asset
acquired by such specified Person.
"Additional Fixed Rate Notes" means Fixed Rate Notes (other
than the Initial Fixed Rate Notes and other than Exchange Notes for
such Initial Fixed Rate Notes) issued under this Indenture in
accordance with Sections 2.01, 2.02 and 4.09 hereof.
"Additional Floating Rate Notes" means Floating Rate Notes
(other than the Initial Floating Rate Notes and other than Exchange Notes issued
for such Initial Floating Rate Notes) issued under this Indenture in accordance
with Sections 2.01, 2.02 and 4.09 hereof.
"Additional Notes" means Additional Fixed Rate Notes and
Additional Floating Rate Notes.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For purposes of this definition,
"control", as used with respect to any Person, means the possession, directly or
indirectly,
of the power to direct or cause the direction of the management or policies of
such Person, whether through the ownership of voting securities, by agreement or
otherwise; provided that beneficial ownership of 10% or more of the Voting Stock
of a Person will be deemed to be control. For purposes of this definition, the
terms "controlling", "controlled by" and "under common control with" have
correlative meanings.
"Agent" means any Registrar, Paying Agent, Calculation Agent
or co-registrar.
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and Clearstream that apply to such
transfer or exchange.
"Asset Sale" means:
(1) the sale, lease, conveyance or other disposition of any
assets or rights, other than sales of inventory in the ordinary course
of business consistent with past practices, but excluding the Equity
Interests or other Investments in Unrestricted Subsidiaries; provided
that the sale, conveyance or other disposition of all or substantially
all of the assets of the Company and its Restricted Subsidiaries taken
as a whole will be governed by Sections 4.15 and/or Sections 5.01
hereof and not by Section 4.10 hereof; and
(2) the issuance of Equity Interests in any of the Company's
Restricted Subsidiaries or the sale of Equity Interests in any of its
Restricted Subsidiaries other than directors' qualifying shares;
provided that the following items will not be deemed to be Asset Sales:
(1) any single transaction or series of related transactions
that involves assets having a fair market value of less than US$1.0
million;
(2) a transfer of assets between or among the Company and its
Wholly Owned Restricted Subsidiaries;
(3) an issuance of Equity Interests by a Restricted Subsidiary
to the Company or to a Wholly Owned Restricted Subsidiary;
(4) the sale or other disposition of cash or Cash Equivalents,
or the sale of accounts receivable in the ordinary course of business
or in connection with the compromise, settlement or collection thereof;
(5) the disposition of surplus, obsolete, discontinued or
worn-out equipment or other immaterial assets no longer used in the
ongoing business of the Company and its Restricted Subsidiaries; and
(6) a sale or other disposition that immediately results in a
Permitted Investment or a Restricted Payment that is permitted by
Section 4.07 hereof.
"Attributable Debt" in respect of a sale and leaseback
transaction means, at the time of determination, the present value of the
obligation of the lessee for net rental payments during the remaining term of
the lease included in such sale and leaseback transaction including any period
for which such lease has been extended or may, at the option of the lessor, be
extended. Such present value shall be calculated
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using a discount rate equal to the rate of interest implicit in such
transaction, determined in accordance with GAAP.
"Bankruptcy Law" means Title 11, U.S. Code, the Bankruptcy and
Insolvency Act (Canada) or any similar United States federal or state law or
Canadian federal, provincial or territorial law for the relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in
Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the
beneficial ownership of any particular "person" (as that term is used in Section
13(d)(3) of the Exchange Act), such "person" will be deemed to have beneficial
ownership of all securities that such "person" has the right to acquire by
conversion or exercise of other securities, whether such right is currently
exercisable or is exercisable only upon the occurrence of a subsequent
condition. The terms "Beneficially Owns" and "Beneficially Owned" have a
corresponding meaning.
"Board of Directors" means:
(1) with respect to a corporation, the board of directors of
the corporation;
(2) with respect to a partnership, the Board of Directors of
the general partner of the partnership; and
(3) with respect to any other Person, the board or committee
of such Person serving a similar function.
"Borrowing Base" means, as of any date, an amount equal to:
(1) 85% of the face amount of all accounts receivable owned by
the Company and the Guarantors as of the end of the most recent fiscal
quarter preceding such date for which internal financial statements are
available that were not more than 90 days past due; plus
(2) 65% of the book value of all inventory owned by the
Company and the Guarantors as of the end of the most recent fiscal
quarter preceding such date for which internal financial statements are
available,
all calculated on a consolidated basis and in accordance with GAAP.
"Broker-Dealer" has the meaning set forth in the Registration
Rights Agreement.
"Business Day" means any day other than a Legal Holiday.
"Buy/Sell Option" means a compulsory offer to purchase or sell
an interest in the High Level Project made pursuant to the High Level Memorandum
of Agreement or similar or replacement documents relating to the High Level
Project.
"Capital Lease Obligation" means, at the time any
determination is to be made, the amount of the liability in respect of a capital
lease that would at that time be required to be capitalized on a balance sheet
in accordance with GAAP.
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"Capital Stock" means:
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any and
all shares, interests, participations, rights or other equivalents
(however designated) of corporate stock;
(3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited); and
(4) any other interest or participation that confers on a
Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"Cash Equivalents" means:
(1) United States dollars or Canadian dollars;
(2) securities issued or directly and fully guaranteed or
insured by the United States government or the Canadian government or
any agency or instrumentality of the United States government or the
Canadian government (provided that the full faith and credit of the
United States or Canada, as applicable, is pledged in support of those
securities) having maturities of not more than six months from the date
of acquisition;
(3) certificates of deposit and eurodollar time deposits with
maturities of six months or less from the date of acquisition, bankers'
acceptances with maturities not exceeding six months and overnight bank
deposits, in each case, with any lender party to a Credit Facility or
U.S. or Canadian commercial bank having capital and surplus in excess
of US$500.0 million and a Thomson Bank Watch Rating of "B" or better;
(4) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clauses (2)
and (3) above entered into with any financial institution meeting the
qualifications specified in clause (3) above;
(5) commercial paper having the highest rating obtainable from
Moody's or S&P and in each case maturing within six months after the
date of acquisition; and
(6) money market funds at least 95% of the assets of which
constitute Cash Equivalents of the kinds described in clauses (1)
through (5) of this definition.
"Change of Control" means the occurrence of any of the
following:
(1) the direct or indirect sale, transfer, conveyance or other
disposition (other than by way of merger, amalgamation or
consolidation), in one or a series of related transactions, of all or
substantially all of the properties or assets of the Company and its
Restricted Subsidiaries taken as a whole to any "person" (as that term
is used in Section 13(d)(3) of the Exchange Act) other than the
Permitted Holders;
(2) the adoption of a plan relating to the liquidation or
dissolution of the Company;
(3) the consummation of any transaction (including, without
limitation, any merger, amalgamation or consolidation) the result of
which is that any "person" (as defined above in
-4-
clause (1)), together with any Affiliates or Related Persons thereof,
other than the Permitted Holders, becomes the Beneficial Owner,
directly or indirectly, of at least 50% of the total voting power of
Voting Stock of the Company;
(4) any "person" (as defined above in clause (1)), together
with any Affiliates or Related Persons thereof, other than the
Permitted Holders, shall succeed in having a sufficient number of its
nominees elected to the Board of Directors of the Company such that
such nominees, when added to any existing director remaining on the
Board of Directors of the Company after such election who was a nominee
of or is an Affiliate or Related Person of such person, will constitute
a majority of the Board of Directors of the Company; or
(5) the Company consolidates or amalgamates with, or merges
with or into, any Person, or any Person consolidates or amalgamates
with, or merges with or into, the Company, in any such event pursuant
to a transaction in which any of the outstanding Voting Stock of the
Company or such other Person is converted into or exchanged for cash,
securities or other property, other than any such transaction where the
Voting Stock of the Company outstanding immediately prior to such
transaction is converted into or exchanged for Voting Stock (other than
Disqualified Stock) of the surviving or transferee Person constituting
a majority of the outstanding shares of such Voting Stock of such
surviving or transferee Person (immediately after giving effect to such
issuance).
"Clearstream" means Clearstream Banking S.A.
"Commission" means the United States Securities and Exchange
Commission.
"Common Stock" of any Person means Capital Stock of such
Person that does not rank prior, as to the payment of dividends or as to the
distribution of assets upon any voluntary or involuntary liquidation,
dissolution or winding-up of such Person, to shares of Capital Stock of any
other class of such Person.
"Company" means Xxxxxxxxx Lumber Co. Ltd., and any and all
successors thereto.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by one or more of its Chairman, Chief
Executive Officer, President, Chief Financial Officer, any Vice President, its
Treasurer or its Secretary, and delivered to the Trustee.
"Consolidated Cash Flow" means, with respect to any specified
Person for any period, the Consolidated Net Income of such Person for such
period plus:
(1) provision for taxes based on income or profits of such
Person and its Restricted Subsidiaries for such period, to the extent
that such provision for taxes was deducted in computing such
Consolidated Net Income; plus
(2) consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued and
whether or not capitalized (including, without limitation, amortization
of debt issuance costs and original issue discount, non-cash interest
payments, the interest component of any deferred payment obligations,
the interest component of all payments associated with Capital Lease
Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect
of letter of credit or bankers' acceptance financings, and net of the
effect of all payments made or received pursuant to
-5-
Hedging Obligations), to the extent that any such expense was deducted
in computing such Consolidated Net Income; plus
(3) depreciation, amortization (including amortization of
goodwill and other intangibles but excluding amortization of prepaid
cash expenses that were paid in a prior period) and other non-cash
expenses (excluding any such non-cash expense to the extent that it
represents an accrual of or reserve for cash expenses in any future
period or amortization of a prepaid cash expense that was paid in a
prior period) of such Person and its Restricted Subsidiaries for such
period to the extent that such depreciation, amortization and other
non-cash expenses were deducted in computing such Consolidated Net
Income; minus
(4) non-cash items increasing such Consolidated Net Income for
such period, other than the accrual of revenue in the ordinary course
of business,
in each case, on a consolidated basis and determined in accordance with GAAP;
provided that, if the consolidated financial statements of the Company include a
minority interest, the amounts in the foregoing clauses (1) to (4) shall be
calculated net of any such amounts included in determining the minority
interest.
Notwithstanding the preceding, the provision for taxes based
on the income or profits of, and the depreciation and amortization and other
non-cash expenses of, a Restricted Subsidiary of the Company will be added to
Consolidated Net Income to compute Consolidated Cash Flow of the Company only to
the extent that a corresponding amount would be permitted at the date of
determination to be dividended to the Company by such Restricted Subsidiary
without prior governmental approval (that has not been obtained), and without
direct or indirect restriction pursuant to the terms of its charter and all
agreements, instruments, judgments, decrees, orders, statutes, rules and
governmental regulations applicable to that Restricted Subsidiary or its
stockholders.
"Consolidated Net Income" means, with respect to any specified
Person for any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; provided that:
(1) the Net Income (but not loss) of any Person that is not a
Restricted Subsidiary or that is accounted for by the equity method of
accounting will be included only to the extent of the amount of
dividends or distributions paid in cash to the specified Person or a
Restricted Subsidiary of the Person;
(2) the Net Income of any Restricted Subsidiary will be
excluded to the extent that the declaration or payment of dividends or
similar distributions by that Restricted Subsidiary of that Net Income
is not at the date of determination permitted without any prior
governmental approval (that has not been obtained) or, directly or
indirectly, by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Restricted Subsidiary or its
stockholders;
(3) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such
acquisition will be excluded; and
(4) the cumulative effect of a change in accounting principles
will be excluded.
"Consolidated Net Tangible Assets" means the total amount of
assets of any Person on a consolidated basis, including deferred pension costs,
after deducting therefrom (i) all current liabilities
-6-
(excluding any indebtedness classified as a current liability), (ii) all
goodwill, trade names, trademarks, patents, unamortized debt discount and
financing costs and all other like intangible assets and (iii) appropriate
adjustments on account of minority interests of other Persons holding shares of
the Subsidiaries of such Person, all as set forth in the most recent balance
sheet of such Person and its consolidated Subsidiaries (but, in any event, as of
a date within 150 days of the date of determination) and computed in accordance
with generally accepted accounting principles.
"Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 12.02 hereof or such other address
as to which the Trustee may give notice to the Company.
"Credit Facilities" means one or more debt facilities or
commercial paper facilities, in each case with banks or other institutional
lenders providing for revolving credit loans, term loans, receivables financing
(including through the sale of receivables to such lenders or to special purpose
entities formed to borrow from such lenders against such receivables) or letters
of credit, in each case, as amended, extended, restated, modified, renewed,
refunded, replaced or refinanced in whole or in part from time to time.
"Custodian" means the Trustee, as custodian with respect to
the Notes in global form, or any successor entity thereto.
"Default" means any event that is, or with the passage of time
or the giving of notice or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the
name of the Holder thereof and issued in accordance with Section 2.06(c) hereof,
substantially in the form of Exhibit A-1 or A-2 hereto, as the case may be,
except that such Note shall not bear the Global Note Legend and shall not have
the "Schedule of Exchanges of Interests in the Global Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section 2.03
hereof as the Depositary with respect to the Notes, and any and all successors
thereto appointed as Depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"Disqualified Stock" means any Capital Stock of the Company
that, by its terms (or by the terms of any security into which it is
convertible, or for which it is exchangeable, in each case at the option of the
holder of the Capital Stock), or upon the happening of any event, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
redeemable at the option of the holder of the Capital Stock, in whole or in
part, on or prior to the date that is 91 days after the date on which the Notes
mature. Notwithstanding the preceding sentence, any Capital Stock that would
constitute Disqualified Stock solely because the holders of the Capital Stock
have the right to require the Company to repurchase such Capital Stock upon the
occurrence of a change of control or an asset sale will not constitute
Disqualified Stock if the terms of such Capital Stock provide that the Company
may not repurchase or redeem any such Capital Stock pursuant to such provisions
unless such repurchase or redemption complies with Section 4.07 hereof.
"Equity Interests" means Capital Stock and all warrants,
options or other rights to acquire Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital Stock).
"Equity Offering" means any public or private issuance or sale
of Common Stock of the Company.
-7-
"Euroclear" means Euroclear S.A./N.V., as operator of the
Euroclear system.
"Exchange Act" means the U.S. Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.
"Exchange Notes" means the Notes issued in the Exchange Offer
pursuant to Section 2.06(f) hereof.
"Exchange Offer" has the meaning set forth in the Registration
Rights Agreement.
"Exchange Registration Statement" has the meaning set forth in
the Registration Rights Agreement.
"Existing Indebtedness" means the Indebtedness of the Company
and its Restricted Subsidiaries in existence on the Issue Date, until such
amounts are repaid.
"Fixed Charge Coverage Ratio" means with respect to any
specified Person for any period, the ratio of the Consolidated Cash Flow of such
Person and its Restricted Subsidiaries for such period to the Fixed Charges of
such Person and its Restricted Subsidiaries for such period. In the event that
the specified Person or any of its Restricted Subsidiaries incurs, assumes,
guarantees, repays, repurchases or redeems any Indebtedness (other than ordinary
working capital borrowings) or issues, repurchases or redeems Disqualified Stock
or preferred stock subsequent to the commencement of the period for which the
Fixed Charge Coverage Ratio is being calculated and on or prior to the date on
which the event for which the calculation of the Fixed Charge Coverage Ratio is
made (the "Calculation Date"), then the Fixed Charge Coverage Ratio will be
calculated giving pro forma effect to such incurrence, assumption, Guarantee,
repayment, repurchase or redemption of Indebtedness, or such issuance,
repurchase or redemption of Disqualified Stock or preferred stock, and the use
of the proceeds therefrom as if the same had occurred at the beginning of the
applicable four-quarter reference period.
In addition, for purposes of calculating the Fixed Charge
Coverage Ratio:
(1) acquisitions that have been made by the specified Person
or any of its Restricted Subsidiaries, including through mergers,
amalgamation or consolidations and including any related financing
transactions, during the four-quarter reference period or subsequent to
such reference period and on or prior to the Calculation Date will be
given pro forma effect as if they had occurred on the first day of the
four-quarter reference period and Consolidated Cash Flow for such
reference period will be calculated on a pro forma basis in accordance
with Regulation S-X under the Securities Act, but without giving effect
to clause (3) of the proviso set forth in the definition of
Consolidated Net Income;
(2) the Consolidated Cash Flow attributable to discontinued
operations, as determined in accordance with GAAP, and operations or
businesses disposed of prior to the Calculation Date, will be excluded;
(3) the Fixed Charges attributable to discontinued operations,
as determined in accordance with GAAP, and operations or businesses
disposed of prior to the Calculation Date, will be excluded, but only
to the extent that the obligations giving rise to such Fixed Charges
will not be obligations of the specified Person or any of its
Restricted Subsidiaries following the Calculation Date; and
-8-
(4) the consolidated interest expense of the specified Person
and its Restricted Subsidiaries attributable to interest on any
Indebtedness (whether existing or being incurred) computed on a pro
forma basis and bearing a floating interest rate shall be computed as
if the rate in effect on the Calculation Date (taking into account
Hedging Obligations applicable to such Indebtedness if such agreement
has a remaining term in excess of 12 months or, if shorter, at least
equal to the remaining term of such Indebtedness) had been the
applicable rate for the entire period.
"Fixed Charges" means, with respect to any specified Person
and its Restricted Subsidiaries for any period, the sum, without duplication,
of:
(1) the consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued,
including, without limitation, amortization of debt issuance costs and
original issue discount, non-cash interest payments, the interest
component of any deferred payment obligations, the interest component
of all payments associated with Capital Lease Obligations, imputed
interest with respect to Attributable Debt, commissions, discounts and
other fees and charges incurred in respect of letter of credit or
bankers' acceptance financings, and net of the effect of all payments
made or received pursuant to Hedging Obligations; plus
(2) the consolidated interest of such Person and its
Restricted Subsidiaries that was capitalized during such period; plus
(3) any interest expense on Indebtedness of another Person
that is Guaranteed by such Person or one of its Restricted Subsidiaries
or secured by a Lien on assets of such Person or one of its Restricted
Subsidiaries, whether or not such Guarantee or Lien is called upon;
plus
(4) the amount of all payments charged to shareholder's equity
on any "compound financial instrument" (as described under GAAP) paid,
accrued or scheduled to be paid or accrued during such period; plus
(5) the product of (a) all dividends, whether paid or accrued
and whether or not in cash, on any series of Disqualified Stock or
preferred stock of such Person or any of its Restricted Subsidiaries,
other than dividends on Equity Interests payable solely in Equity
Interests of the Company (other than Disqualified Stock) or to the
Company or a Wholly Owned Restricted Subsidiary of the Company, times
(b) a fraction, the numerator of which is one and the denominator of
which is one minus the then current combined federal, provincial, state
and local statutory tax rate of such Person, expressed as a decimal, in
each case, on a consolidated basis and in accordance with GAAP.
"Fixed Rate Notes" means the Initial Fixed Rate Notes and any
Additional Fixed Rate Notes.
"Floating Rate Notes" means the Initial Floating Rate Notes
and any Additional Floating Rate Notes.
"GAAP" means, as of any date of determination, generally
accepted accounting principles in Canada and which are applicable as of any date
of determination.
"Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.
-9-
"Global Notes" means, individually and collectively, each of
the Restricted Global Notes and the Unrestricted Global Notes, substantially in
the form of Exhibit A-1 or A-2 hereto, as the case may be, issued in accordance
with Section 2.01, 2.02, 2.06(b), 2.06(d) or 2.06(f) hereof.
"Government Securities" means direct obligations of, or
obligations guaranteed by, the United States of America, and the payment for
which the United States pledges its full faith and credit.
"Grant" means Grant Forest Products Inc., an Ontario
corporation, any other Person or Persons who replace Grant and become co-owners
of the High Level Project, any successor entity thereto, and any Affiliate
thereof.
"Guarantee" means a guarantee other than by endorsement of
negotiable instruments for collection in the ordinary course of business, direct
or indirect, in any manner including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness.
"Guarantors" means any Subsidiary that executes a Subsidiary
Guarantee in accordance with the provisions of this Indenture and its respective
successors and assigns.
"Hedging Obligations" means, with respect to any specified
Person, the obligations of such Person under:
(1) interest rate swap agreements, interest rate cap
agreements and interest rate collar agreements; and
(2) other agreements or arrangements designed to protect such
Person against fluctuations in currency exchange rates, commodity
prices or interest rates.
"High Level Memorandum of Agreement" means the memorandum of
agreement, dated as of December 9, 1999, between the Company and Grant Forest
Products Corp., relating to the High Level Project.
"High Level Project" means the oriented strand board facility,
jointly owned by the Company and Grant, located near High Level, Alberta,
together with all associated, operating, shareholder and ownership agreements
and rights held by Footner Forest Products Ltd. to harvest logs processed
through such facility pursuant to a deciduous timber allocation issued by the
government of Alberta.
"Holder" means a Person in whose name a Note is registered in
the Note Register.
"Indebtedness" means, with respect to any specified Person,
any indebtedness of such Person, whether or not contingent:
(1) in respect of borrowed money;
(2) evidenced by bonds, notes, debentures or similar
instruments or letters of credit (or reimbursement agreements in
respect thereof);
(3) in respect of banker's acceptances;
(4) representing Capital Lease Obligations;
-10-
(5) representing the balance deferred and unpaid of the
purchase price of any property, except any such balance that
constitutes an accrued expense or trade payable; or
(6) representing any Hedging Obligations,
if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP; provided, however, that
Indebtedness shall not include obligations of any Person (i) arising from the
honoring by a bank or other financial institution of a check, draft or similar
instrument inadvertently drawn against insufficient funds in the ordinary course
of business, provided that such obligations are extinguished within 15 days of
their incurrence, (ii) resulting from the endorsement of negotiable instruments
for collection in the ordinary course of business and consistent with past
business practices and (iii) under stand-by letters of credit to the extent
collateralized by cash or cash equivalents. In addition, the term "Indebtedness"
includes all Indebtedness of others secured by a Lien on any asset of the
specified Person (whether or not such Indebtedness is assumed by the specified
Person) and, to the extent not otherwise included, the Guarantee by the
specified Person of any indebtedness of any other Person.
The amount of any Indebtedness outstanding as of any date will
be:
(1) the accreted value of the Indebtedness, in the case of any
Indebtedness issued with original issue discount; and
(2) the principal amount of the Indebtedness, together with
any interest on the Indebtedness that is more than 30 days past due, in
the case of any other Indebtedness.
"Indenture" means this Indenture, as amended or supplemented
from time to time.
"Indirect Participant" means a Person who holds a beneficial
interest in a Global Note through a Participant.
"Initial Fixed Rate Notes" means the US$275,000,000 in
aggregate principal amount of Fixed Rate Notes issued under this Indenture on
the Issue Date.
"Initial Floating Rate Notes" means the US$175,000,000 in
aggregate principal amount of Floating Rate Notes issued under this Indenture on
the Issue Date.
"Initial Notes" means the Initial Fixed Rate Notes and the
Initial Floating Rate Notes.
"Institutional Accredited Investor" means an institution that
is an "accredited investor" within the meaning of Rule 501(a)(1), (2), (3) or
(7) under the Securities Act and that is not also a QIB.
"Interest Payment Date" means (i) with respect to the Fixed
Rate Notes, June 30th and December 30th of each year to Stated Maturity and (ii)
with respect to the Floating Rate Notes, March 30th, June 30th, September 30th
and December 30th of each year to Stated Maturity.
"Investment Grade Ratings" means (i) BBB- or above, in the
case of S&P (or its equivalent under any successor Rating Categories of S&P) and
Baa3 or above, in the case of Moody's (or its equivalent under any successor
Rating Categories of Moody's), or (ii) the equivalent in respect of the Rating
Categories of any Rating Agencies substituted for S&P or Moody's.
-11-
"Investments" means, with respect to any Person, all direct or
indirect investments by such Person in other Persons (including Affiliates) in
the forms of loans (including Guarantees or other obligations), advances or
capital contributions (excluding commission, travel and similar advances to
officers and employees made in the ordinary course of business), purchases or
other acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP, but shall not
include trade accounts receivable in the ordinary course of business on credit
terms made generally available to customers of such Person. If the Company or
any Subsidiary of the Company sells or otherwise disposes of any Equity
Interests of any direct or indirect Subsidiary of the Company such that, after
giving effect to any such sale or disposition, such Person is no longer a
Subsidiary of the Company, the Company will be deemed to have made an Investment
on the date of any such sale or disposition equal to the fair market value of
the Equity Interests of such Subsidiary not sold or disposed of in an amount
determined as provided in Section 4.07(c) hereof. The acquisition by the Company
or any Subsidiary of the Company of a Person that holds an Investment in a third
Person will be deemed to be an Investment by the Company or such Subsidiary in
such third Person in an amount equal to the fair market value of the Investment
held by the acquired Person in such third Person in an amount determined as
provided in Section 4.07(c) hereof.
"Issue Date" means September 22, 2004, the date of original
issuance of the Initial Notes.
"Legal Holiday" means a Saturday, a Sunday or a day on which
commercial banking institutions in the City of New York, the City of Toronto,
the City of Vancouver or the city of the Corporate Trust Office of the Trustee
are authorized by law, regulation or executive order to remain closed. If a
payment date is a Legal Holiday at a place of payment, payment may be made at
that place on the next succeeding day that is not a Legal Holiday, and no
interest shall accrue on such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be
prepared by the Company and sent to all Holders of the Notes for use by such
Holders in connection with the Exchange Offer.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under applicable
law, including any conditional sale or other title retention agreement, any
lease in the nature thereof, any option or other agreement to sell or give a
security interest in and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Net Income" means, with respect to any specified Person, the
net income (loss) of such Person, determined in accordance with GAAP and before
any reduction in respect of preferred stock dividends, excluding, however:
(1) any gain or loss, together with any related provision for
taxes on such gain or loss, realized in connection with: (a) any Asset
Sale; or (b) the disposition of any securities by such Person or any of
its Restricted Subsidiaries or the extinguishment of any Indebtedness
of such Person or any of its Restricted Subsidiaries; and
(2) any extraordinary gain or loss, together with any related
provision for taxes on such extraordinary gain or loss.
-12-
"Net Proceeds" means the aggregate cash proceeds received by
the Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of
the direct costs relating to such Asset Sale, including, without limitation,
legal, accounting and investment banking fees, and sales commissions, and any
relocation expenses incurred as a result of the Asset Sale, taxes paid or
payable as a result of the Asset Sale, in each case, after taking into account
any available tax credits or deductions and any tax sharing arrangements, and
amounts required to be applied to the repayment of Indebtedness secured by a
Lien on the asset or assets that were the subject of such Asset Sale and any
reserve for adjustment in respect of the sale price of such asset or assets
established in accordance with GAAP.
"Non-Guarantor Restricted Subsidiaries" means any North
American Restricted Subsidiaries that collectively do not have total assets in
excess of US$3.0 million, and which are designated by the Board of Directors of
the Company as evidenced by a resolution of the Board of Directors delivered to
the Trustee.
"Non-Recourse Debt" means Indebtedness:
(1) as to which neither the Company nor any of its Restricted
Subsidiaries (a) provides credit support of any kind (including any
undertaking, agreement or instrument that would constitute
Indebtedness), (b) is directly or indirectly liable as a guarantor or
otherwise, or (c) constitutes the lender;
(2) no default with respect to which (including any rights
that the holders of the Indebtedness may have to take enforcement
action against an Unrestricted Subsidiary) would permit upon notice,
lapse of time or both any holder of any other Indebtedness of the
Company or any of its Restricted Subsidiaries to declare a default on
such other Indebtedness or cause the payment of the Indebtedness to be
accelerated or payable prior to its stated maturity; and
(3) as to which the lenders have been notified in writing that
they will not have any recourse to the stock or assets of the Company
or any of its Restricted Subsidiaries;
except for any limited recourse guarantee solely for the purpose of supporting
the pledge by the Company or any of its Restricted Subsidiaries of the Equity
Interests of any Unrestricted Subsidiaries.
"Non-U.S. Person" means a Person who is not a U.S. Person as
defined in Rule 902(k) under the Securities Act.
"North American Restricted Subsidiary" means any Restricted
Subsidiary of the Company that was formed under the laws of the United States or
any state of the United States or the District of Columbia or under the laws of
Canada or any province or territory thereof.
"Notes" means the Fixed Rate Notes and the Floating Rate Notes
and more particularly means any Note authenticated and delivered under this
Indenture. For all purposes of this Indenture, the term "Notes" shall include
any Additional Fixed Rate Notes and Additional Floating Rate Notes that may be
issued under a supplemental indenture. The Fixed Rate Notes (including any
Exchange Notes issued in exchange therefor) and the Floating Rate Notes
(including any Exchange Notes issued in exchange therefor) are separate series
of Notes, but shall be treated as a single class for all purposes under this
Indenture, except as set forth herein. For purposes of this Indenture, all
references to Notes to be issued or authenticated upon transfer, replacement or
exchange shall be deemed to refer to Notes of the appropriate series.
-13-
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offering Memorandum" means the offering memorandum of the
Company dated September 17, 2004 relating to the sale of the Initial Notes.
"Officer" means, with respect to any Person, the Chairman of
the Board, the Chief Executive Officer, the President, the Chief Operating
Officer, the Chief Financial Officer, any Vice President, the Treasurer, any
Assistant Treasurer, the Controller, the Secretary or any Vice-President of such
Person.
"Officers' Certificate" means a certificate signed on behalf
of a Person by two Officers of such Person, one of whom must be the principal
executive officer, the principal financial officer, the treasurer or the
principal accounting officer of such Person that meets the requirements of
Section 12.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who
is reasonably acceptable to the Trustee, that meets the requirements of Section
12.05 hereof. The counsel may be an employee of or counsel to the Company, or
any Restricted Subsidiary.
"Participant" means, with respect to the Depositary, Euroclear
or Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).
"Permitted Business" means any business that derives a
majority of its revenues from the businesses engaged in by the Company and its
Restricted Subsidiaries on the Issue Date and/or activities that are reasonably
similar, ancillary or related to, or a reasonable extension, development or
expansion of, the businesses in which the Company and its Restricted
Subsidiaries were engaged on the Issue Date.
"Permitted Holder" means (i) each of Xxxxx Xxxxxxxxx, D. Xxxxx
Xxxxxxxxx and Xxxxx X. Xxxxxxxxx, (ii) the members of the immediate family of
each of the persons referred to in clause (i) above, (iii) any trust created for
the benefit of any of the persons referred to in clauses (i) and (ii) above or
(iv) any Person at least 85% of the outstanding Capital Stock of which is owned
by one or more of the persons described in clauses (i), (ii) and (iii) above.
"Permitted Investments" means:
(1) any Investment in the Company or in a Restricted
Subsidiary;
(2) any Investment in Cash Equivalents;
(3) any Investment by the Company or any Guarantor in a
Person, if as a result of such Investment:
(i) such Person becomes a Guarantor; or
(ii) such Person is merged, consolidated or amalgamated
with or into, or transfers or conveys substantially all of its
assets to, or is liquidated into, the Company or a Guarantor;
-14-
(4) any Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and in
compliance with Section 4.10 hereof;
(5) any acquisition of assets, Capital Stock or other
securities solely in exchange for the issuance of Equity Interests
(other than Disqualified Stock) of the Company;
(6) any Investments by the Company or a Restricted Subsidiary
received in compromise of claims, settlements of debts or disputes or
satisfaction of judgments relating to obligations payable to the
Company or such Restricted Subsidiary, as the case may be, in its
capacity as trade creditor or from customers, which obligations were
incurred in the ordinary course of business, including pursuant to any
plan of reorganization or similar arrangement upon the bankruptcy or
insolvency of any trade creditor or customer;
(7) Hedging Obligations in the ordinary course of business and
not for speculative purposes;
(8) an Investment by the Company or any Restricted Subsidiary
in a Permitted Joint Venture; provided that the aggregate amount of all
Investments made pursuant to this clause (8) does not exceed US$3.0
million at any one time outstanding; and
(9) other Investments in any Person having an aggregate fair
market value (measured on the date each such Investment was made and
without giving effect to subsequent changes in value), when taken
together with all other Investments made pursuant to this clause (9)
since March 3, 2004, not to exceed 5% of the Consolidated Net Tangible
Assets of the Company.
"Permitted Joint Venture" means any joint venture arrangement
created by the Company or one of its Restricted Subsidiaries, the primary
purpose of which is to obtain fiber to supply the operations of the Company or
its Restricted Subsidiaries, provided that the Company and its Restricted
Subsidiaries own an equity interest in such arrangement of at least 40% of the
Equity Interests in such arrangement.
"Permitted Liens" means:
(1) Liens to secure Indebtedness permitted by Section
4.09(b)(1) hereof on the accounts receivable and inventories (including
spare parts) of the Company and its Restricted Subsidiaries, including
the proceeds thereof and all money, securities and property of the
Company and its Restricted Subsidiaries and the proceeds thereof held
by any lender of such indebtedness, and all related books and records
and other intangibles evidencing such collateral;
(2) Liens in favor of the Company or the Guarantors;
(3) Liens on property of a Person existing at the time such
Person is merged with or into or amalgamated or consolidated with the
Company or any Restricted Subsidiary of the Company; provided that such
Liens were in existence prior to the contemplation of such merger,
amalgamation or consolidation and do not extend to any assets other
than those of the Person merged into or consolidated or amalgamated
with the Company or the Restricted Subsidiary;
(4) Liens on property existing at the time of acquisition of
the property by the Company or any Restricted Subsidiary of the
Company, provided that such Liens were in existence prior to the
contemplation of such acquisition;
-15-
(5) Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds or other obligations of a
like nature incurred in the ordinary course of business;
(6) Liens to secure Indebtedness (including Capital Lease
Obligations) permitted by Section 4.09(b)(4) hereof covering only the
assets acquired with such Indebtedness;
(7) Liens existing on the Issue Date;
(8) Liens for taxes, assessments or governmental charges or
claims that are not yet delinquent or that are being contested in good
faith by appropriate proceedings promptly instituted and diligently
concluded, provided that any reserve or other appropriate provision as
is required in conformity with GAAP has been made therefor;
(9) Liens securing Indebtedness under Hedging Obligations in
the ordinary course of business and not for speculative purposes;
provided that (i) such Liens are only secured by property or assets
that secure the Indebtedness subject to the Hedging Obligation or (ii)
if such Hedging Obligations are with one or more parties to Credit
Facilities, then secured by the same collateral as secures the
applicable Credit Facilities;
(10) Liens on the Equity Interests of Unrestricted
Subsidiaries or Permitted Joint Ventures securing Indebtedness of such
Unrestricted Subsidiaries or Permitted Joint Ventures not otherwise
prohibited by this Indenture;
(11) Liens securing Permitted Refinancing Indebtedness
incurred to refinance any secured Indebtedness; provided that the Liens
securing such Permitted Refinancing Indebtedness are not extended to
any additional assets or property;
(12) Liens incurred in the ordinary course of business of the
Company or any Restricted Subsidiary of the Company with respect to
obligations that do not exceed at any one time outstanding 5% of the
Consolidated Net Tangible Assets of the Company;
(13) a general security agreement between the Company and
Grant securing the obligations of the Company or its Subsidiaries under
the High Level Memorandum of Agreement or similar documents relating to
the High Level Project; and
(14) Liens securing Purchase Money Indebtedness; provided,
however, that (a) such Purchase Money Indebtedness shall not exceed the
purchase price or other cost of such property or equipment and shall
not be secured by any property or equipment of the Company or any
Restricted Subsidiary of the Company other than the property and
equipment so acquired and (b) the Lien securing such Purchase Money
Indebtedness shall be created within 90 days of such acquisition.
"Permitted Refinancing Indebtedness" means any Indebtedness of
the Company or any of its Restricted Subsidiaries or Disqualified Stock of the
Company or preferred stock of Restricted Subsidiaries of the Company issued in
exchange for, or the net proceeds of which are used to extend, refinance, renew,
replace, defease or refund other Indebtedness of the Company or any of its
Restricted Subsidiaries or Disqualified Stock of the Company or preferred stock
of Restricted Subsidiaries of the Company (other than intercompany Indebtedness,
Disqualified Stock or preferred stock); provided that:
-16-
(1) the principal amount (or accreted value, if applicable) of
such Permitted Refinancing Indebtedness does not exceed the principal
amount (or accreted value, if applicable) of the Indebtedness,
Disqualified Stock or preferred stock extended, refinanced, renewed,
replaced, defeased or refunded (plus all accrued interest or dividends
on the Indebtedness, Disqualified Stock or preferred stock and the
amount of all expenses and premiums incurred in connection therewith);
(2) such Permitted Refinancing Indebtedness has a final
maturity date later than the final maturity date of, and has a Weighted
Average Life to Maturity equal to or greater than the Weighted Average
Life to Maturity of, the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded;
(3) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to
the Notes or a Subsidiary Guarantee, such Permitted Refinancing
Indebtedness has a final maturity date later than the final maturity
date of, and is subordinated in right of payment to, the Notes or such
Subsidiary Guarantee on terms at least as favorable to the Holders of
Notes as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded; and
(4) such Indebtedness is incurred either by the Company or by
the Restricted Subsidiary that is the obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company or government or other entity.
"Private Placement Legend" means the legend set forth in
Section 2.06(g)(i) to be placed on all Notes issued under this Indenture, except
where otherwise permitted by the provisions of this Indenture.
"Purchase Money Indebtedness" means Indebtedness of the
Company and its Restricted Subsidiaries for the purpose of financing all or any
part of the purchase price, or the installation, construction or improvement, of
property (including Capital Stock) or equipment.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A.
"Rating Agencies" means (i) S&P and Moody's or (ii) if S&P or
Moody's or both of them are not making ratings of the Notes publicly available,
a nationally recognized U.S. rating agency or agencies, as the case may be,
selected by the Company, which will be substituted for S&P or Moody's or both,
as the case may be.
"Rating Category" means (i) with respect to S&P, any of the
following categories (and any associated "+" or "-" designation): AAA, AA, A,
BBB, BB, B, CCC, CC, C and D (or equivalent successor categories); (ii) with
respect to Moody's, any of the following categories (and any associated "1", "2"
or "3" designation): Aaa, Aa, A, Baa, Ba, B, Caa, Ca, C and D (or equivalent
successor categories); and (iii) the equivalent of any such categories of S&P or
Moody's used by another Rating Agency, if applicable.
"Record Date" for the interest or Special Interest, if any,
payable on any applicable Interest Payment Date means (i) with respect to the
Fixed Rate Notes, June 15th or December 15th and
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(ii) with respect to the Floating Rate Notes, March 15th, June 15th, September
15th or December 15th (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date.
"Registration Rights Agreement" means the Exchange and
Registration Rights Agreement, dated the date hereof by and among the Company,
the Guarantor and the other parties named on the signature pages thereof, as
such agreement may be amended, modified or supplemented from time to time and,
with respect to any Additional Notes, one or more registration rights agreements
between the Company and the other parties thereto, as such agreement(s) may be
amended, modified or supplemented from time to time, relating to rights given by
the Company to the purchasers of Additional Notes to register such Additional
Notes under the Securities Act.
"Regulation S" means Regulation S promulgated under the
Securities Act.
"Regulation S Global Note" means a Global Note in the form of
Exhibit A-1 or Exhibit A-2 hereto, as the case may be, bearing the Global Note
Legend (but without the Private Placement Legend) and deposited with or on
behalf of and registered in the name of the Depositary or its nominee.
"Related Person" of any Person means any other Person directly
or indirectly owning (a) 5% or more of the outstanding Common Stock of such
Person (or, in the case of a Person that is not a corporation, 5% or more of the
equity interest in such Person) or (b) 5% or more of the combined voting power
of the Voting Stock of such Person.
"Responsible Officer" means , when used with respect to the
Trustee, any officer within the corporate trust department of the Trustee,
including any vice president, assistant vice president, assistant secretary,
assistant treasurer, trust officer or any other officer of the Trustee who
customarily performs functions similar to those performed by the Persons who at
the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of such person's knowledge of and familiarity with
the particular subject and who shall have direct responsibility for the
administration of this Indenture.
"Restricted Definitive Note" means a Definitive Note bearing
the Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the
Private Placement Legend.
"Restricted Investment" means an Investment other than a
Permitted Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of
that Person that is not an Unrestricted Subsidiary.
"Right of First Refusal" means the exercise by the Company of
the right to acquire the interest of Grant in the High Level Project pursuant to
the right of first refusal option contained in the High Level Memorandum of
Agreement or similar or replacement documents related to the High Level Project.
"Rule 144" means Rule 144 promulgated under the Securities
Act.
"Rule 144A" means Rule 144A promulgated under the Securities
Act.
"Rule 903" means Rule 903 promulgated under the Securities
Act.
"Rule 904" means Rule 904 promulgated the Securities Act.
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"S&P" means Standard & Poor's Ratings Services.
"Securities Act" means the U.S. Securities Act of 1933, as
amended, and the rules and regulations of the Commission promulgated thereunder.
"Shelf Registration Statement" means the Shelf Registration
Statement as defined in the Registration Rights Agreement.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date hereof.
"Special Interest" means all special interest then owing
pursuant to the Registration Rights Agreement.
"Stated Maturity" means, with respect to any installment of
interest or principal on any series of Indebtedness, the date on which the
payment of interest or principal was scheduled to be paid in the original
documentation governing such Indebtedness, and will not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior
to the date originally scheduled for the payment thereof.
"Subsidiary" means, with respect to any specified Person:
(1) any corporation, association or other business entity of
which more than 50% of the total voting power of shares of Capital
Stock entitled (without regard to the occurrence of any contingency) to
vote in the election of directors, managers or trustees of the
corporation, association or other business entity is at the time owned
or controlled, directly or indirectly, by that Person or one or more of
the other Subsidiaries of that Person (or a combination thereof); and
(2) any partnership (a) the sole general partner or the
managing general partner of which is such Person or a Subsidiary of
such Person or (b) the only general partners of which are that Person
or one or more Subsidiaries of that Person (or any combination
thereof).
"Subsidiary Guarantee" means the Guarantee by each Guarantor
of the Company's payment obligations under this Indenture and on the Notes,
executed pursuant to the provisions of this Indenture.
"TIA" means the Trust Indenture Act of 1939 as in effect on
the date on which this Indenture is qualified under the TIA.
"Trustee" means the party named as such above until a
successor replaces it in accordance with the applicable provisions of this
Indenture and thereafter means the successor serving hereunder.
"Unrestricted Definitive Note" means one or more Definitive
Notes that do not bear and are not required to bear the Private Placement
Legend.
"Unrestricted Global Note" means a permanent Global Note,
substantially in the form of Exhibit A-1 or A-2 attached hereto, as the case may
be, that bears the Global Note Legend and that has the "Schedule of Exchanges of
Interests in the Global Note" attached thereto, and that is deposited with or
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on behalf of and registered in the name of the Depositary, representing Notes
that do not bear the Private Placement Legend.
"Unrestricted Subsidiary" means any Subsidiary of the Company
that is designated by the Board of Directors as an Unrestricted Subsidiary
pursuant to a resolution of the Board of Directors of the Company, but only to
the extent that such Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement or
understanding with the Company or any Restricted Subsidiary of the
Company unless the terms of any such agreement, contract, arrangement
or understanding are no less favorable to the Company or such
Restricted Subsidiary than those that might be obtained at the time
from Persons who are not Affiliates of the Company;
(3) is a Person with respect to which neither the Company nor
any of its Restricted Subsidiaries has any direct or indirect
obligation (a) to subscribe for additional Equity Interests or (b) to
maintain or preserve such Person's financial condition or to cause such
Person to achieve any specified levels of operating results;
(4) has not Guaranteed or otherwise directly or indirectly
provided credit support for any Indebtedness of the Company or any of
its Restricted Subsidiaries; and
(5) has at least one director on its Board of Directors that
is not a director or executive officer of the Company or any of its
Restricted Subsidiaries and has at least one executive officer that is
not a director or executive officer of the Company or any of its
Restricted Subsidiaries.
Any designation of a Subsidiary of the Company as an
Unrestricted Subsidiary will be evidenced to the Trustee by filing with the
Trustee a certified copy of the Board Resolution giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the preceding conditions and was permitted by Section 4.07 hereof.
If, at any time, any Unrestricted Subsidiary would fail to meet the preceding
requirements as an Unrestricted Subsidiary, it will thereafter cease to be an
Unrestricted Subsidiary for purposes of this Indenture and any Indebtedness of
such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the
Company as of such date and, if such Indebtedness is not permitted to be
incurred as of such date under Section 4.09 hereof, the Company will be in
default of such covenant. The Board of Directors of the Company may at any time
designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided
that such designation will be deemed to be an incurrence of Indebtedness by a
Restricted Subsidiary of the Company of any outstanding Indebtedness of such
Unrestricted Subsidiary and such designation will only be permitted if (1) such
Indebtedness is permitted under the covenant described under Section 4.09
hereof, calculated on a pro forma basis as if such designation had occurred at
the beginning of the four-quarter reference period; and (2) no Default or Event
of Default would be in existence following such designation.
"U.S." and "United States" means the United States of America,
its territories and possessions, any state of the United states, and the
District of Columbia.
"U.S. Dollar" and "US$" mean United States dollars.
"$" means Canadian dollars.
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"U.S. Person" means a U.S. person as defined in Rule 902(k)
under the Securities Act.
"Voting Stock" of any Person as of any date means the Capital
Stock of such Person that is at the time entitled to vote in the election of the
Board of Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying (a) the
amount of each then remaining installment, sinking fund, serial
maturity or other required payments of principal, including payment at
final maturity, in respect of the Indebtedness, by (b) the number of
years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment; by
(2) the then outstanding principal amount of such
Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which (other than directors' qualifying shares)
shall at the time be owned by such Person or by one or more Wholly Owned
Restricted Subsidiaries of such Person or by such Person and one or more Wholly
Owned Restricted Subsidiaries of such Person.
Section 1.02 Other Definitions.
Defined in
Term Section
---- ------------
"Additional Amounts"............................................................................. 4.18
"Affiliate Transaction".......................................................................... 4.11
"Asset Sale Offer"............................................................................... 4.10
"Asset Sale Payment"............................................................................. 4.10
"Authentication Order"........................................................................... 2.02
"Calculation Agent".............................................................................. 2.03
"Change of Control Offer......................................................................... 4.15
"Change of Control Payment....................................................................... 4.15
"Covenant Defeasance"............................................................................ 8.03
"DTC"............................................................................................ 2.03
"Documentary Taxes".............................................................................. 4.18
"Event of Default"............................................................................... 6.01
"Excess Proceeds"................................................................................ 4.10
"Excluded Holder"................................................................................ 4.18
"Fall-Away Covenants"............................................................................ 4.23
"Fall-Away Period"............................................................................... 4.23
"First Currency"................................................................................. 12.15
"incur".......................................................................................... 4.09
"judgment currency".............................................................................. 12.14
"Legal Defeasance"............................................................................... 8.02
"Note Register".................................................................................. 2.03
"Offer Amount"................................................................................... 3.09
"Offer Period"................................................................................... 3.09
"Other Currency"................................................................................. 12.15
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Defined in
Term Section
---- ------------
"owner".......................................................................................... 4.18
"Paying Agent"................................................................................... 2.03
"Payment Default"................................................................................ 6.01
"Permitted Indebtedness"......................................................................... 4.09
"Purchase Date".................................................................................. 3.09
"Registrar"...................................................................................... 2.03
"Repurchase Offer"............................................................................... 3.09
"Restricted Payments"............................................................................ 4.07
"Taxes".......................................................................................... 4.18
Section 1.03 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the
following meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the
Trustee; and
"obligor" on the Notes and the Subsidiary Guarantees means the
Company and the Guarantors, respectively, and any successor obligor upon the
Notes and the Subsidiary Guarantees, respectively.
All other terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by Commission rule
under the TIA have the meanings so assigned to them.
Section 1.04 Rules of Construction.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(c) "or" is not exclusive;
(d) words in the singular include the plural, and in the
plural include the singular;
(e) provisions apply to successive events and transactions;
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(f) references to sections of, or rules under, the Securities
Act shall be deemed to include substitute, replacement or successor
sections or rules adopted by the Commission from time to time;
(g) unless the context otherwise requires, any reference to an
"Article," "Section" or "clause" refers to an Article, Section or
clause, as the case may be, of this Indenture; and
(h) the words "herein," "hereof" and "hereunder" and other
words of similar import, refer to this Indenture as a whole and not any
particular Article, Section, clause or other subdivision.
ARTICLE 2
THE NOTES
Section 2.01 Form and Dating; Terms.
(a) General. The Notes and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A-1 (in the case of
the Fixed Rate Notes) and Exhibit A-2 (in the case of the Floating Rate Notes)
hereto. The Notes may have notations, legends or endorsements required by law,
stock exchange rules or usage. Each Note shall be dated the date of its
authentication. The Notes shall be in denominations of US$1,000 and integral
multiples thereof. Each Note shall have an executed Guarantee from the Guarantor
endorsed thereon substantially in the form of Exhibit E hereto.
(b) Global Notes. Notes issued in global form shall be
substantially in the form of Exhibit A-1 (in the case of the Fixed Rate Notes)
and Exhibit A-2 (in the case of the Floating Rate Notes) attached hereto
(including the Global Note Legend thereon and the "Schedule of Exchanges of
Interests in the Global Note" attached thereto). Notes issued in definitive form
shall be substantially in the form of Exhibit A-1 (in the case of the Fixed Rate
Notes) and Exhibit A-2 (in the case of the Floating Rate Notes) attached hereto
(but without the Global Note Legend thereon and without the "Schedule of
Exchanges of Interests in the Global Note" attached thereto). Each Global Note
shall represent such of the outstanding Notes as shall be specified therein and
each shall provide that it shall represent the aggregate principal amount of
outstanding Notes from time to time endorsed thereon and that the aggregate
principal amount of outstanding Notes represented thereby may from time to time
be reduced or increased, as appropriate, to reflect exchanges and redemptions.
Any endorsement of a Global Note to reflect the amount of any increase or
decrease in the aggregate principal amount of outstanding Notes represented
thereby shall be made by the Trustee or the Custodian, at the direction of the
Trustee, in accordance with instructions given by the Holder thereof as required
by Section 2.06 hereof.
(c) Terms. The aggregate principal amount of Notes which may
be authenticated and delivered under this Indenture is unlimited.
The terms and provisions contained in the Notes shall
constitute, and are hereby expressly made, a part of this Indenture and the
Company and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby. However,
to the extent any provision of any Note conflicts with the express provisions of
this Indenture, the provisions of this Indenture shall govern and be
controlling.
The Notes shall be subject to repurchase by the Company
pursuant to an Asset Sale Offer as provided in Section 4.10 hereof or a Change
of Control Offer as provided in Section 4.15 hereof. The Notes shall not be
redeemable, other than as provided in Article 3.
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Additional Notes ranking pari passu with the Initial Notes may
be created and issued from time to time by the Company without notice to or
consent of the Holders and shall be consolidated with and form a single class
with the Initial Notes and shall have the same terms as to status, redemption or
otherwise as the Initial Notes; provided that the Company's ability to issue
Additional Notes shall be subject to the Company's compliance with Section 4.09
hereof. Any Additional Notes shall be issued with the benefit of an indenture
supplemental to this Indenture.
(d) Euroclear and Clearstream Procedures Applicable. The
provisions of the "Operating Procedures of the Euroclear System" and "Terms and
Conditions Governing Use of Euroclear" and the "General Terms and Conditions of
Clearstream" and "Customer Handbook" of Clearstream shall be applicable to
transfers of beneficial interests in the Regulation S Global Notes that are held
by Participants through Euroclear or Clearstream.
Section 2.02 Execution and Authentication.
Two Officers shall execute the Notes on behalf of the Company
by manual or facsimile signature.
If an Officer whose signature is on a Note no longer holds
that office at the time a Note is authenticated, the Note shall nevertheless be
valid.
A Note shall not be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose until authenticated
substantially in the form of Exhibit A-1 or Exhibit A-2 attached hereto, as the
case may be, by the manual or facsimile signature of the Trustee. The signature
shall be conclusive evidence that the Note has been duly authenticated and
delivered under this Indenture.
The Trustee shall, upon a Company Order (an "Authentication
Order") on the Issue Date, authenticate and deliver (i) the Initial Fixed Rate
Notes and (ii) the Initial Floating Rate Notes. In addition, at any time, from
time to time, the Trustee shall upon an Authentication Order authenticate and
deliver any Additional Notes for an aggregate principal amount specified in such
Authentication Order for such Additional Notes issued hereunder.
The Trustee may appoint an authenticating agent acceptable to
the Company to authenticate Notes. An authenticating agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Company.
Section 2.03 Registrar, Paying Agent and Calculation Agent.
The Company shall maintain an office or agency where Notes may
be presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). In
addition, there shall be a Calculation Agent for purposes of the Floating Rate
Notes (the "Calculation Agent"). The Registrar shall keep a register of the
Notes ("Note Register") and of their transfer and exchange. The Company may
appoint one or more co-registrars and one or more additional paying agents. The
term "Registrar" includes any co-registrar and the term "Paying Agent" includes
any additional paying agent. The Company may change any Paying Agent, Registrar
or Calculation Agent without prior notice to any Holder. The Company shall
notify the Trustee in writing of the name and address of any Agent not a party
to this Indenture. If the Company fails to appoint or maintain another entity as
Registrar, Paying Agent or Calculation Agent, the Trustee shall act as such. The
Company or any Guarantor may act as Paying Agent or Registrar.
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The Company initially appoints The Depository Trust Company
("DTC") to act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the
Paying Agent, Registrar and Calculation Agent for the Notes and to act as
Custodian with respect to the Global Notes.
Section 2.04 Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all money held by the Paying Agent for the
payment of principal, premium, if any, or Special Interest, if any, or interest
on the Notes, and will notify the Trustee of any default by the Company in
making any such payment. While any such default continues, the Trustee may
require a Paying Agent to pay all money held by it to the Trustee. The Company
at any time may require a Paying Agent to pay all money held by it to the
Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the
Company or a Restricted Subsidiary) shall have no further liability for the
money. If the Company or a Restricted Subsidiary acts as Paying Agent, it shall
segregate and hold in a separate trust fund for the benefit of the Holders all
money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Company, the Trustee shall serve as Paying Agent for
the Notes.
Section 2.05 Holder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of all Holders and shall otherwise comply with TIA Section 312(a). If
the Trustee is not the Registrar, the Company shall furnish to the Trustee at
least seven Business Days before each Interest Payment Date and at such other
times as the Trustee may request in writing, a list in such form and as of such
date as the Trustee may reasonably require of the names and addresses of the
Holders of Notes and the Company shall otherwise comply with TIA Section 312(a).
Section 2.06 Transfer and Exchange.
(a) Transfer and Exchange of Global Notes. Except as otherwise
set forth in this Section 2.06, a Global Note may be transferred in whole and
not in part only to a nominee of the Depositary, or to a successor Depositary or
a nominee of such successor Depositary. A beneficial interest in a Global Note
may not be exchanged for a Definitive Note unless (i) the Depositary (x)
notifies the Company that it is unwilling or unable to continue as Depositary
for such Global Note or (y) has ceased to be a clearing agency registered under
the Exchange Act, and in either case, a successor Depositary is not appointed by
the Company within 120 days, (ii) in the case of a Global Note held for an
account of Euroclear or Clearstream, Euroclear or Clearstream, as the case may
be, (A) is closed for business for a continuous period of 14 days (other than by
reason of statutory or other holidays) or (B) announces an intention permanently
to cease business or does in fact do so, (iii) the Company is required by law to
exchange Global Notes for Definitive Notes and the Company delivers a written
notice to the Trustee to such effect, (iv) there shall have occurred and be
continuing an Event of Default with respect to the Notes or (v) a request for
certificates has been made upon 60 days' prior written notice given to the
Trustee in accordance with the Depositary's customary procedures and a copy of
such notice has been received by the Company from the Trustee. Upon the
occurrence of any of the preceding events in (i) to (v) above, Definitive Notes
delivered in exchange for any Global Note or beneficial interest therein will be
registered in the names, and shall be issued in such denominations as the
Depositary (in accordance with its customary procedures) shall instruct the
Trustee. Global Notes also may be exchanged or replaced, in whole or in part, as
provided in Sections 2.07 and 2.10 hereof. Every Note authenticated and
delivered in exchange for, or in lieu of, a Global Note or any portion thereof,
pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof,
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shall be authenticated and delivered in the form of, and shall be, a Global
Note, except for Definitive Notes issued subsequent to any of the preceding
events in (i) to (v) above or pursuant to Section 2.06(c) hereof. A Global Note
may not be exchanged for another Note other than as provided in this Section
2.06(a); however, beneficial interests in a Global Note may be transferred and
exchanged as provided in Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the
Global Notes. The transfer and exchange of beneficial interests in the Global
Notes shall be effected through the Depositary, in accordance with the
provisions of this Indenture and the Applicable Procedures. Beneficial interests
in the Restricted Global Notes shall be subject to restrictions on transfer
comparable to those set forth herein to the extent required by the Securities
Act. Transfers of beneficial interests in the Global Notes also shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well as
one or more of the other following subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred
to Persons who take delivery thereof in the form of a beneficial
interest in the same Restricted Global Note in accordance with the
transfer restrictions set forth in the Private Placement Legend.
Beneficial interests in any Unrestricted Global Note may be transferred
to Persons who take delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note. No written orders or
instructions shall be required to be delivered to the Registrar to
effect the transfers described in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests
in Global Notes. In connection with all transfers and exchanges of
beneficial interests that are not subject to Section 2.06(b)(i) above,
the transferor of such beneficial interest must deliver to the
Registrar either (A) (1) a written order from a Participant or an
Indirect Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to credit or cause to be
credited a beneficial interest in another Global Note in an amount
equal to the beneficial interest to be transferred or exchanged and (2)
instructions given in accordance with the Applicable Procedures
containing information regarding the Participant account to be credited
with such increase or (B) (1) a written order from a Participant or an
Indirect Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to cause to be issued a
Definitive Note in an amount equal to the beneficial interest to be
transferred or exchanged and (2) instructions given by the Depositary
to the Registrar containing information regarding the Person in whose
name such Definitive Note shall be registered to effect the transfer or
exchange referred to in (1) above. Upon consummation of an Exchange
Offer by the Company in accordance with Section 2.06(f) hereof, the
requirements of this Section 2.06(b)(ii) shall be deemed to have been
satisfied upon receipt by the Registrar of the instructions contained
in the Letter of Transmittal delivered by the Holder of such beneficial
interests in the Global Notes. Upon satisfaction of all of the
requirements for transfer or exchange of beneficial interests in Global
Notes contained in this Indenture and the Notes or otherwise applicable
under the Securities Act, the Trustee shall adjust the principal amount
of the relevant Global Note(s) pursuant to Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests to Another Restricted
Global Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(ii) above and the
Registrar receives a certificate in the form of Exhibit B hereto,
including the certifications in item (1) thereof.
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(iv) Transfer and Exchange of Beneficial Interests in a
Restricted Global Note for Beneficial Interests in the Unrestricted
Global Note. A beneficial interest in any Restricted Global Note may be
exchanged by any holder thereof for a beneficial interest in an
Unrestricted Global Note or transferred to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global
Note if the exchange or transfer complies with the requirements of
Section 2.06(b)(ii) hereof and:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the holder of the beneficial interest to be
transferred, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of
Transmittal that it is not (1) a Broker-Dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3)
a Person who is an affiliate (as defined in Rule 144) of the
Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant
to the Exchange Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such
beneficial interest for a beneficial interest in an
Unrestricted Global Note, a certificate from such Holder
substantially in the form of Exhibit C hereto, including
the certifications in item (1)(a) thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such
beneficial interest to a Person who shall take delivery
thereof in the form of a beneficial interest in an
Unrestricted Global Note, a certificate from such holder
in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B)
or (D) above at a time when an Unrestricted Global Note has not yet been issued,
the Company shall issue and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note can be
exchanged for, or transferred to Persons who take delivery thereof in the form
of, a beneficial interest in a Restricted Global Note without any certification.
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(c) Transfer or Exchange of Beneficial Interests for
Definitive Notes.
(i) Beneficial Interests in Restricted Global Notes to
Restricted Definitive Notes. If any holder of a beneficial interest in a
Restricted Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note or to transfer such beneficial interest to a Person
who takes delivery thereof in the form of a Restricted Definitive Note, then,
upon the occurrence of any of the preceding events in Sections 2.06(a)(i) - (v)
and receipt by the Registrar of the following documentation:
(A) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note, a certificate from such holder
substantially in the form of Exhibit C hereto, including the
certifications in item (2)(a) thereof;
(B) if such beneficial interest is being transferred to a QIB
in accordance with Rule 144A under the Securities Act, a certificate
substantially in the form of Exhibit B hereto, including the
certifications in item (1) thereof;
(C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule 903
or Rule 904 under the Securities Act, a certificate substantially in
the form of Exhibit B hereto, including the certifications in item (2)
thereof;
(D) if such beneficial interest is being transferred pursuant
to an exemption from the registration requirements of the Securities
Act in accordance with Rule 144 under the Securities Act, a certificate
substantially in the form of Exhibit B hereto, including the
certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to an
Institutional Accredited Investor in reliance on an exemption from the
registration requirements of the Securities Act other than those listed
in subparagraph (B) above, a certificate substantially in the form of
Exhibit B hereto, including the certifications in item 3(d) thereof and
such certificates and Opinion of Counsel required by item (3) thereof,
if applicable;
(F) if such beneficial interest is being transferred to the
Company or any of its Restricted Subsidiaries, a certificate
substantially in the form of Exhibit B hereto, including the
certifications in item (3)(b) thereof; or
(G) if such beneficial interest is being transferred pursuant
to an effective registration statement under the Securities Act, a
certificate substantially in the form of Exhibit B hereto, including
the certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the
Company shall execute and the Trustee shall authenticate and deliver to the
Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered. Any Definitive Note issued
in exchange for a beneficial interest in a Restricted Global Note pursuant to
this Section 2.06(c)(i) shall bear the Private Placement Legend and shall be
subject to all restrictions on transfer contained therein.
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(ii) Beneficial Interests in Restricted Global Notes to
Unrestricted Definitive Notes. A holder of a beneficial interest in a Restricted
Global Note may exchange such beneficial interest for an Unrestricted Definitive
Note or may transfer such beneficial interest to a Person who takes delivery
thereof in the form of an Unrestricted Definitive Note only upon the occurrence
of any of the preceding events in Sections 2.06(a)(i) - (v) and if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement and
the holder of such beneficial interest, in the case of an exchange, or
the transferee, in the case of a transfer, certifies in the applicable
Letter of Transmittal that it is not (1) a Broker-Dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3) a Person
who is an affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant to
the Exchange Registration Statement in accordance with the Registration
Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Definitive Note that does not bear the Private
Placement Legend, a certificate from such holder substantially
in the form of Exhibit C hereto, including the certifications
in item (1)(b) thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the
form of a Definitive Note that does not bear the Private
Placement Legend, a certificate from such holder substantially
in the form of Exhibit B hereto, including the certifications
in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
(iii) Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes. If any holder of a beneficial interest in an
Unrestricted Global Note proposes to exchange such beneficial interest for a
Definitive Note or to transfer such beneficial interest to a Person who takes
delivery thereof in the form of a Definitive Note, then, upon the occurrence of
any of the preceding events in Sections 2.06(a)(i) - (v) and satisfaction of the
conditions set forth in Section 2.06(b)(ii) hereof, the Trustee shall cause the
aggregate principal amount of the applicable Global Note to be reduced
accordingly pursuant to Section 2.06(h) hereof, and the Company shall execute
and the Trustee shall authenticate and deliver to the Person designated in the
instructions a Definitive Note in the appropriate principal amount. Any
Definitive Note issued in exchange for a beneficial interest pursuant to this
Section 2.06(c)(iii) shall be registered in such name or names and in such
authorized denomination or denominations as the holder of such beneficial
interest shall instruct the Registrar through instructions from the Depositary
and the Participant or Indirect Participant. The Trustee shall deliver such
Definitive Notes to the Persons in whose names such Notes are so registered. Any
Definitive Note issued in exchange for a beneficial interest pursuant to this
Section 2.06(c)(iii) shall not bear the Private Placement Legend.
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(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests.
(i) Restricted Definitive Notes to Beneficial Interests in
Restricted Global Notes. If any Holder of a Restricted Definitive Note proposes
to exchange such Note for a beneficial interest in a Restricted Global Note or
to transfer such Restricted Definitive Note to a Person who takes delivery
thereof in the form of a beneficial interest in a Restricted Global Note, then,
upon receipt by the Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive Note proposes
to exchange such Note for a beneficial interest in a Restricted Global
Note, a certificate from such Holder substantially in the form of
Exhibit C hereto, including the certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Note is being transferred to
a QIB in accordance with Rule 144A under the Securities Act, a
certificate substantially in the form of Exhibit B hereto, including
the certifications in item (1) thereof;
(C) if such Restricted Definitive Note is being transferred to
a Non-U.S. Person in an offshore transaction in accordance with Rule
903 or Rule 904 under the Securities Act, a certificate substantially
in the form of Exhibit B hereto, including the certifications in item
(2) thereof;
(D) if such Restricted Definitive Note is being transferred
pursuant to an exemption from the registration requirements of the
Securities Act in accordance with Rule 144 under the Securities Act, a
certificate substantially in the form of Exhibit B hereto, including
the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being transferred to
an Institutional Accredited Investor in reliance on an exemption from
the registration requirements of the Securities Act other than those
listed in subparagraphs (B) through (D) above, a certificate
substantially in the form of Exhibit B hereto, including the
certification in item 3(d) thereof and such certificates and Opinion of
Counsel required therein by item, if applicable;
(F) if such Restricted Definitive Note is being transferred to
the Company or any of its Restricted Subsidiaries, a certificate
substantially in the form of Exhibit B hereto, including the
certifications in item (3)(b) thereof; or
(G) if such Restricted Definitive Note is being transferred
pursuant to an effective registration statement under the Securities
Act, a certificate substantially in the form of Exhibit B hereto,
including the certifications in item (3)(c) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or cause to be
increased the aggregate principal amount of, in the case of clause (A) above,
the appropriate Restricted Global Note, in the case of clause (B) above, the
appropriate 144A Global Note, and in the case of clause (C) above, the
appropriate Regulation S Global Note.
(ii) Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note may exchange
such Note for a beneficial interest in an Unrestricted Global Note or transfer
such Restricted Definitive Note to a Person who takes delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement and
the Holder, in the case of an exchange, or the
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transferee, in the case of a transfer, certifies in the applicable
Letter of Transmittal that it is not (1) a Broker-Dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3) a Person
who is an affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant to
the Exchange Registration Statement in accordance with the Registration
Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Definitive Notes proposes to
exchange such Notes for a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder
substantially in the form of Exhibit C hereto, including the
certifications in item (1)(c) thereof; or
(2) if the Holder of such Definitive Notes proposes to
transfer such Notes to a Person who shall take delivery
thereof in the form of a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder
substantially in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the
subparagraphs in this Section 2.06(d)(ii), the Trustee shall cancel the
Definitive Notes and increase or cause to be increased the aggregate principal
amount of the Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global Note or
transfer such Definitive Notes to a Person who takes delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note at any time. Upon
receipt of a request for such an exchange or transfer, the Trustee shall cancel
the applicable Unrestricted Definitive Note and increase or cause to be
increased the aggregate principal amount of one of the Unrestricted Global
Notes.
(iv) Unrestricted Definitive Notes to Beneficial Interests in
Restricted Global Notes. A Holder of an Unrestricted Definitive Note may
exchange such Note for a beneficial interest in a Restricted Global Note or
transfer such Definitive Notes to a Person who takes delivery thereof in the
form of a beneficial interest in a Restricted Global Note at any time. Upon
receipt of a request for such an exchange or transfer, the Trustee shall cancel
the applicable Unrestricted Definitive Note and increase or cause to be
increased the aggregate principal amount of one of the Restricted Global Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraph (ii)(B), (ii)(D) or
(iii) above at a time when an Unrestricted Global Note has not yet been issued,
the Company shall issue and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
principal amount of Definitive Notes so transferred.
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(e) Transfer and Exchange of Definitive Notes for Definitive
Notes. Upon request by a Holder of Definitive Notes and such Holder's compliance
with the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder shall present or surrender to the Registrar
the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e):
(i) Restricted Definitive Notes to Restricted Definitive
Notes. Any Restricted Definitive Note may be transferred to and
registered in the name of Persons who take delivery thereof in the form
of a Restricted Definitive Note if the Registrar receives the
following:
(A) if the transfer will be made pursuant to a QIB in
accordance with Rule 144A under the Securities Act, then the
transferor must deliver a certificate substantially in the
form of Exhibit B hereto, including the certifications in item
(1) thereof;
(B) if the transfer shall be made pursuant to Rule 903 or
Rule 904 then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications in item
(2) thereof; or
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the Securities
Act, then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)
thereof, if applicable.
(ii) Restricted Definitive Notes to Unrestricted Definitive
Notes. Any Restricted Definitive Note may be exchanged by the Holder
thereof for an Unrestricted Definitive Note or transferred to a Person
or Persons who take delivery thereof in the form of an Unrestricted
Definitive Note if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a
Broker-Dealer, (2) a Person participating in the distribution
of the Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) any such transfer is effected by a Broker-Dealer
pursuant to the Exchange Registration Statement in accordance
with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes
proposes to exchange such Notes for an Unrestricted
Definitive Note, a certificate from such Holder
substantially in the form of Exhibit C hereto, including
the certifications in item (1)(d) thereof; or
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(2) if the Holder of such Restricted Definitive Notes
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of an Unrestricted Definitive
Note, a certificate from such Holder substantially in the
form of Exhibit B hereto, including the certifications in
item (4) thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests, an Opinion of Counsel in form
reasonably acceptable to the Company to the effect that such
exchange or transfer is in compliance with the Securities Act
and that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted Definitive
Notes. A Holder of Unrestricted Definitive Notes may transfer such
Notes to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Note. Upon receipt of a request to register
such a transfer, the Registrar shall register the Unrestricted
Definitive Notes pursuant to the instructions from the Holder thereof.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer
in accordance with the Registration Rights Agreement, the Company shall issue
and, upon receipt of an Authentication Order in accordance with Section 2.02
hereof, the Trustee shall authenticate (i) one or more Unrestricted Global Notes
in an aggregate principal amount equal to the principal amount of the beneficial
interests in the Global Notes tendered for acceptance by Persons that certify in
the applicable Letters of Transmittal that (x) they are not broker-dealers, (y)
they are not participating in a distribution of the Exchange Notes and (z) they
are not affiliates (as defined in Rule 144) of the Company, and accepted for
exchange in the Exchange Offer and (ii) Definitive Notes in an aggregate
principal amount equal to the principal amount of the Definitive Notes accepted
for exchange in the Exchange Offer. Concurrently with the issuance of such
Notes, the Trustee shall cause the aggregate principal amount of the applicable
Global Notes to be reduced accordingly, and the Company shall execute and the
Trustee shall authenticate and deliver to the Persons designated by the Holders
of Definitive Notes so accepted Definitive Notes in the appropriate principal
amount. Any Notes that remain outstanding after the consummation of the Exchange
Offer, and Exchange Notes issued in connection with the Exchange Offer, shall be
treated as a single class of securities under this Indenture.
(g) Legends. The following legends shall appear on the face of
all Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture:
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each Global
Note and each Definitive Note (and all Notes issued in exchange therefor or
substitution thereof) shall bear the legend in substantially the following form:
"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT (A)(1) TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A UNDER THE SECURITIES ACT PURCHASING
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A
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TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN
OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF
REGULATION S UNDER THE SECURITIES ACT, (3) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED
BY RULE 144 THEREUNDER (IF AVAILABLE), (4) TO AN INSTITUTIONAL
ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, OR (5)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, AND (B) IN ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE STATES OF THE UNITED STATES AND OTHER
JURISDICTIONS."
(B) Notwithstanding the foregoing, any Regulation S Global
Note and any other Global Note or Definitive Note issued pursuant to
subparagraph (b)(iv), (c)(ii), (c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or
(f) of this Section 2.06 (and all Notes issued in exchange therefor or
substitution thereof) shall not bear the Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend
in substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR
THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT
TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT
(I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE
REQUIRED PURSUANT TO SECTION 2.06(h) OF THE INDENTURE, (II)
THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART
PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION
PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL
NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE
PRIOR WRITTEN CONSENT OF THE COMPANY."
(h) Cancellation and/or Adjustment of Global Notes. At such
time as all beneficial interests in a particular Global Note have been exchanged
for Definitive Notes or a particular Global Note has been redeemed, repurchased
or canceled in whole and not in part, each such Global Note shall be returned to
or retained and canceled by the Trustee in accordance with Section 2.11 hereof.
At any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for or transferred to a Person who will take delivery thereof
in the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
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(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Global Notes and
Definitive Notes upon the Company's order or at the Registrar's request.
(ii) No service charge shall be made to a holder of a
beneficial interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any transfer tax or similar governmental charge payable
in connection therewith (other than any such transfer taxes or similar
governmental charge payable upon exchange or transfer pursuant to Sections 2.07,
2.10, 3.06, 3.09, 4.10, 4.15 and 9.05 hereof).
(iii) Neither the Registrar nor the Company shall be required
to register the transfer of or exchange any Note selected for redemption in
whole or in part, except the unredeemed portion of any Note being redeemed in
part.
(iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive Notes shall
be the valid obligations of the Company, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Global Notes or Definitive
Notes surrendered upon such registration of transfer or exchange.
(v) The Company shall not be required (A) to issue, to
register the transfer of or to exchange any Notes during a period beginning at
the opening of business 15 days before the day of any selection of Notes for
redemption under Section 3.02 hereof and ending at the close of business on the
day of selection, (B) to register the transfer of or to exchange any Note so
selected for redemption in whole or in part, except the unredeemed portion of
any Note being redeemed in part or (C) to register the transfer of or to
exchange a Note between a record date and the next succeeding Interest Payment
Date.
(vi) Prior to due presentment for the registration of a
transfer of any Note, the Trustee, any Agent and the Company may deem and treat
the Person in whose name any Note is registered as the absolute owner of such
Note for the purpose of receiving payment of principal of (and premium, if any)
and interest (including Special Interest, if any) on such Notes and for all
other purposes, and none of the Trustee, any Agent or the Company shall be
affected by notice to the contrary.
(vii) Upon surrender for registration of transfer of any
Security at the office or agency of the Company designated pursuant to Section
4.02, the Company shall execute, and the Trustee shall authenticate and deliver,
in the name of the designated transferee or transferees, one or more replacement
Notes of any authorized denomination or denominations of a like aggregate
principal amount.
(viii) At the option of the Holder, Notes may be exchanged for
other Notes of any authorized denomination or denominations of a like aggregate
principal amount upon surrender of the Notes to be exchanged at such office or
agency. Whenever any Global Notes or Definitive Notes are so surrendered for
exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the replacement Global Notes and Definitive Notes which the Holder
making the exchange is entitled to in accordance with the provisions of Section
2.02 hereof.
(ix) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section 2.06 to
effect a registration of transfer or exchange may be submitted by facsimile.
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Section 2.07 Replacement Notes.
If any mutilated Note is surrendered to the Trustee or the
Company and the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Note, the Company shall issue and the Trustee,
upon receipt of an Authentication Order, shall authenticate a replacement Note
if the Trustee's requirements are met. If required by the Trustee or the
Company, an indemnity bond must be supplied by the Holder that is sufficient in
the judgment of the Trustee and the Company to protect the Company, the Trustee,
any Agent and any authenticating agent from any loss that any of them may suffer
if a Note is replaced. The Company may charge for its expenses in replacing a
Note.
Every replacement Note is an additional obligation of the
Company and shall be entitled to all of the benefits of this Indenture equally
and proportionately with all other Notes duly issued hereunder.
Section 2.08 Outstanding Notes.
The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those canceled by it, those delivered to
it for cancellation, those reductions in the interest in a Global Note effected
by the Trustee in accordance with the provisions hereof, and those described in
this Section as not outstanding. Except as set forth in Section 2.09 hereof, a
Note does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Note.
If a Note is replaced pursuant to Section 2.07 hereof, it
ceases to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under
Section 4.01 hereof, it ceases to be outstanding and interest on it ceases to
accrue.
If the Paying Agent (other than the Company, a Subsidiary or
an Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
Section 2.09 Treasury Notes.
In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, waiver or consent, Notes owned
by the Company, or by any Affiliate of the Company, shall be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes that a Responsible Officer of the Trustee knows are so owned shall be
so disregarded. Notes so owned which have been pledged in good faith shall not
be disregarded if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right to deliver any such direction, waiver or consent with respect to
the Notes and that the pledgee is not the Company or any obligor upon the Notes
or any Affiliate of the Company or of such other obligor.
Section 2.10 Temporary Notes.
Until certificates representing Notes are ready for delivery,
the Company may prepare and the Trustee, upon receipt of an Authentication
Order, shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form of certificated Notes but may have variations that the
Company considers appropriate for temporary Notes and as shall be reasonably
acceptable to the Trustee. Without
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unreasonable delay, the Company shall prepare and the Trustee shall authenticate
definitive Notes in exchange for temporary Notes.
Holders and beneficial holders, as the case may be, of
temporary Notes shall be entitled to all of the benefits accorded to Holders, or
beneficial holders, respectively, of Notes under this Indenture.
Section 2.11 Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall dispose of
cancelled Notes (subject to the record retention requirement of the Exchange
Act). Certification of the disposal of all cancelled Notes shall be delivered to
the Company. The Company may not issue new Notes to replace Notes that it has
paid or that have been delivered to the Trustee for cancellation.
Section 2.12 Defaulted Interest.
If the Company defaults in a payment of interest on the Notes,
it shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.01 hereof. The Company shall notify the Trustee in
writing of the amount of defaulted interest proposed to be paid on each Note and
the date of the proposed payment, and at the same time the Company shall deposit
with the Trustee an amount of money equal to the aggregate amount proposed to be
paid in respect of such defaulted interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the proposed
payment, such money when deposited to be held in trust for the benefit of the
Persons entitled to such defaulted interest as provided in this Section 2.12.
The Trustee shall fix or cause to be fixed each such special record date and
payment date; provided that no such special record date shall be less than 10
days prior to the related payment date for such defaulted interest. The Trustee
shall promptly notify the Company of such special record date. At least 15 days
before the special record date, the Company (or, upon the written request of the
Company, the Trustee in the name and at the expense of the Company) shall mail
or cause to be mailed, first-class postage prepaid, to each Holder a notice at
his or her address as it appears in the Note Register that states the special
record date, the related payment date and the amount of such interest to be
paid.
Subject to the foregoing provisions of this Section 2.12 and
for greater certainty, each Note delivered under this Indenture upon
registration of transfer of or in exchange for or in lieu of any other Note
shall carry the rights to interest accrued and unpaid, and to accrue, which were
carried by such other Note.
ARTICLE 3
REDEMPTION
Section 3.01 Notices to Trustee.
If the Company elects to redeem Fixed Rate Notes or Floating
Rate Notes pursuant to paragraph 5 of the Fixed Rate Notes or paragraph 5 of the
Floating Rate Notes, as the case may be, it shall furnish to the Trustee, at
least 30 days but not more than 60 days before a redemption date, an Officers'
Certificate setting forth (i) the paragraph or subparagraph of such Note
pursuant to which the redemption
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shall occur, (ii) the redemption date, (iii) the principal amount of the Fixed
Rate Notes or Floating Rate Notes, as the case may be, to be redeemed and (iv)
the redemption price.
Section 3.02 Selection of Notes to Be Redeemed.
If less than all of the Fixed Rate Notes or Floating Rate
Notes, as the case may be, are to be redeemed or purchased in an offer to
purchase at any time, the Trustee shall select the Notes to be redeemed or
purchased among the Holders of the Notes 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, by lot or by
such other method the Trustee considers fair and appropriate. In the event of
partial redemption by lot, the particular Notes to be redeemed shall be
selected, unless otherwise provided herein, not less than 30 nor more than 60
days prior to the redemption date by the Trustee from the outstanding Notes not
previously called for redemption.
The Trustee shall promptly notify the Company in writing of
the Notes selected for redemption and, in the case of any Note selected for
partial redemption, the principal amount thereof to be redeemed. Notes and
portions of Notes selected shall be in amounts of US$1,000 or whole multiples of
US$1,000; no Notes of US$1,000 or less can be redeemed in part, except that if
all of the Notes of a Holder are to be redeemed, the entire outstanding amount
of Notes held by such Holder, even if not a multiple of US$1,000, shall be
redeemed. Except as provided in the preceding sentence, provisions of this
Indenture that apply to Notes called for redemption also apply to portions of
Notes called for redemption.
Section 3.03 Notice of Redemption.
Subject to Section 3.09 hereof, the Company shall mail or
cause to be mailed by first class mail notices of redemption at least 30 days
but not more than 60 days before the redemption date to each Holder of Notes to
be redeemed at its registered address, except that redemption notices may be
mailed more than 60 days prior to a redemption date if the notice is issued in
connection with Article 8 or Article 11 hereof. Notices of redemption may not be
conditional.
The notice shall identify the Notes to be redeemed and shall
state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is to be redeemed in part only, the portion of
the principal amount of that Note that is to be redeemed and that,
after the redemption date upon surrender of such Note, a new Note or
Notes in principal amount equal to the unredeemed portion of the
original Note representing the same indebtedness to the extent not
redeemed will be issued in the name of the Holder of the Notes upon
cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to
the Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such
redemption payment, interest on Notes called for redemption ceases to
accrue on and after the redemption date;
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(g) the paragraph or subparagraph of the Notes pursuant to
which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed
on the Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided that the Company
shall have delivered to the Trustee, at least 35 days prior to the redemption
date, an Officers' Certificate requesting that the Trustee give such notice and
setting forth the information to be stated in such notice as provided in the
preceding paragraph.
Section 3.04 Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section
3.03 hereof, Notes called for redemption become irrevocably due and payable on
the redemption date at the redemption price. Subject to Section 3.05 hereof, on
and after the redemption date, interest ceases to accrue on Notes or portions of
Notes called for redemption.
Section 3.05 Deposit of Redemption Price.
One Business Day prior to the redemption date, the Company
shall deposit with the Trustee or with the Paying Agent money sufficient to pay
the redemption price of and accrued and unpaid interest (including Special
Interest, if any) on all Notes to be redeemed on that date. The Trustee or the
Paying Agent shall promptly return to the Company any money deposited with the
Trustee or the Paying Agent by the Company in excess of the amounts necessary to
pay the redemption price of, and accrued and unpaid interest on, all Notes to be
redeemed.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue on
the Notes or the portions of Notes called for redemption. If a Note is redeemed
on or after a Record Date but on or prior to the related Interest Payment Date,
then any accrued and unpaid interest shall be paid to the Person in whose name
such Note was registered at the close of business on such Record Date. If any
Note called for redemption shall not be so paid upon surrender for redemption
because of the failure of the Company to comply with the preceding paragraph,
interest shall be paid on the unpaid principal, from the redemption date until
such principal is paid, and to the extent lawful on any interest accrued to the
redemption date not paid on such unpaid principal, in each case at the rate
provided in the Notes and in Section 4.01 hereof.
Section 3.06 Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Company
shall issue and, upon the Company's written request, the Trustee shall
authenticate for the Holder at the expense of the Company a new Note equal in
principal amount to the unredeemed portion of the Note surrendered representing
the same indebtedness to the extent not redeemed; provided that each new Note
will be in a principal amount of US$1,000 or an integral multiple of US$1,000.
Section 3.07 Reserved.
Section 3.08 Mandatory Redemption.
The Company shall not be required to make mandatory redemption
or sinking fund payments with respect to the Notes.
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Section 3.09 Offers to Repurchase.
(a) In the event that, pursuant to Section 4.10 or 4.15
hereof, the Company shall be required to commence an Asset Sale Offer or a
Change of Control Offer, as the case may be, (each, a "Repurchase Offer"), it
shall follow the procedures specified below.
(b) The Repurchase Offer shall remain open for a period of 20
Business Days following its commencement and no longer, except to the extent
that a longer period is required by applicable law (the "Offer Period"). No
later than five Business Days after the termination of the Offer Period (the
"Purchase Date"), the Company shall purchase the principal amount of Notes
required to be purchased pursuant to Section 4.10 or 4.15, as applicable, (the
"Offer Amount") or, if less than the Offer Amount has been tendered, all Notes
tendered in response to the Repurchase Offer. Payment for any Notes so purchased
shall be made in the same manner as interest payments are made.
(c) If the Purchase Date is on or after a Record Date and on
or before the related Interest Payment Date, any accrued and unpaid 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 Repurchase Offer.
(d) Upon the commencement of a Repurchase Offer, the Company
shall send, by first class mail, a notice to each of the Holders, 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 Repurchase Offer. The
Repurchase Offer shall be made to all Holders. The notice, which shall govern
the terms of the Repurchase Offer, shall state:
(i) that the Repurchase Offer is being made pursuant to this
Section 3.09 and Section 4.10 or 4.15, as applicable, the length of
time the Repurchase Offer shall remain open and that all Notes properly
tendered will be accepted for payment. If the Repurchase Offer is a
Change of Control Offer made pursuant to Section 4.15 such notice shall
describe the transaction or transactions that constitute the Change of
Control;
(ii) the Offer Amount, the Asset Sale Payment or Change of
Control Payment, as applicable, and the Purchase Date;
(iii) that any Note not tendered or accepted for payment shall
continue to accrue interest;
(iv) that, unless the Company defaults in making such payment,
any Note accepted for payment pursuant to the Repurchase Offer shall
cease to accrue interest after the Purchase Date;
(v) that Holders electing to have a Note purchased pursuant to
a Repurchase Offer may elect to have Notes purchased in integral
multiples of US$1,000 only;
(vi) that Holders electing to have a Note purchased pursuant
to any Repurchase Offer shall be required to surrender the Note, with
the form entitled "Option of Holder to Elect Purchase" on the reverse
of the Note completed, or transfer by book-entry transfer, to the
Company, a depositary, if appointed by the Company, or a Paying Agent
at the address specified in the notice at least three days before the
Purchase Date;
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(vii) that Holders shall be entitled to withdraw their
election if the Company, the depositary or the Paying Agent, as the
case may be, 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 a statement that such Holder is
withdrawing his election to have such Note purchased;
(viii) that, if the aggregate principal amount of Notes
surrendered by Holders exceeds the Offer Amount required pursuant to
Section 4.10, the Company shall select the Notes to be purchased
pursuant to Section 3.02 (with such adjustments as may be deemed
appropriate by the Company so that only Notes in denominations of
US$1,000, or integral multiples thereof, shall be purchased); and
(ix) that Holders whose Notes were purchased only in part
shall be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered (or transferred by book-entry
transfer) representing the same indebtedness to the extent not
repurchased.
(e) On or before the Purchase Date, the Company shall, to the
extent lawful, (1) accept for payment, on a pro rata basis to the extent
necessary, the Offer Amount of Notes or portions thereof tendered pursuant to
the Repurchase Offer, or if less than the Offer Amount has been tendered, all
Notes tendered, (2) deposit with the Paying Agent an amount equal to the Offer
Amount plus premium, if any, and any accrued and unpaid interest and Special
Interest, if any, in respect of all Notes, or portions thereof, properly
tendered, and (3) deliver or cause to be delivered to the Trustee the Notes
properly accepted together with an Officers' Certificate stating the aggregate
principal amount of Notes or portions of Notes being purchased by the Company in
accordance with the terms of this Section 3.09.
(f) The Company, the Depositary or the Paying Agent, as the
case may be, shall promptly (but in any case not later than five days after the
Purchase Date) mail or deliver to each tendering Holder an amount equal to the
purchase price of the Notes properly tendered by such Holder and accepted by the
Company for purchase, and the Company shall promptly issue a new Note, and the
Trustee, upon written request from the Company shall authenticate and mail or
deliver (or cause to be transferred by book entry) such new Note to such Holder
in a principal amount equal to any unpurchased portion of the Note surrendered
representing the same indebtedness to the extent not repurchased. Any Note not
so accepted shall be promptly mailed or delivered by the Company to the Holder
thereof. The Company shall publicly announce the results of the Repurchase Offer
on or as soon as practicable after the Purchase Date.
Other than as specifically provided in this Section 3.09, any
purchase pursuant to this Section 3.09 shall be made pursuant to the provisions
of Sections 3.01 through 3.06 hereof.
ARTICLE 4
COVENANTS
Section 4.01 Payment of Notes.
The Company shall pay or cause to be paid the principal of,
premium, if any, Special Interest, if any, and interest on the Notes on the
dates and in the manner provided in the Notes. Principal, premium, if any, and
interest shall be considered paid on the date due if the Paying Agent, if other
than the Company, a Subsidiary or an Affiliate thereof, holds as of 2:00 p.m.
Eastern Time on the due date money deposited by the Company in immediately
available funds and designated for and sufficient to pay all principal, premium,
if any, and interest then due.
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The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal at the
rate equal to 1% per annum in excess of the then applicable interest rate on the
Notes to the extent lawful; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue installments of
interest and Special Interest (without regard to any applicable grace period) at
the same rate to the extent lawful.
Section 4.02 Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan in the
City of New York an office or agency (which may be an office of the Trustee or
an affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Company in respect of the Notes and this Indenture may be
served. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.
The Company may also from time to time designate one or more
other offices or agencies where the Notes may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations;
provided that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan in the City of New York for such purposes. The Company shall give
prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency.
The Company and Xxxxxxxxx Engineered Corp., as Guarantor, each
hereby designate the Corporate Trust Office of the Trustee as one such office or
agency of the Company and such Guarantor, as the case may be, in accordance with
Section 2.03 hereof.
Section 4.03 Reports to Holders.
(a) Whether or not required by the Commission, so long as any
Notes are outstanding, the Company will furnish to the Holders of Notes, within
the time periods specified in the Commission's rules and regulations (i) all
quarterly and annual financial information that the Company would have been
required to file with the Commission on (A) Forms 10-Q and 10-K if the Company
were required to file on such Forms, or (B) on Form 6-K and Form 20-F or 40-F
(if eligible) if the Company were required to file such form and was a reporting
issuer under the securities laws of the Province of Ontario, including in each
case a "Management's Discussion and Analysis of Financial Condition and Results
of Operations" and, with respect to the annual information only, a report on the
annual financial statements by the Company's independent registered chartered
accountants and (ii) all current reports that the Company would have been
required to (a) file with or furnish to the Commission on Form 8-K if the
Company were required to file or furnish such reports, or (b) furnish to the
Commission on Form 6-K if the Company were required to furnish such reports and
were a reporting issuer under the securities laws of the Province of Ontario.
(b) If, at any time after consummation of the Exchange Offer
the Company is no longer subject to the periodic reporting requirements of the
Exchange Act for any reason, the Company will nevertheless continue filing the
reports specified in the preceding paragraph with the Commission within the time
periods specified above unless the Commission will not accept such a filing. The
Company agrees that it will not take any action for the purpose of causing the
Commission not to accept any such filings. If, notwithstanding the foregoing,
the Commission will not accept the Company's filings for any reason, the Company
will post the reports referred to in the preceding paragraph on its website
within
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the time periods that would apply if the Company were required to file those
reports with the Commission. In addition, the Company agrees that, for so long
as any Notes remain outstanding, it will furnish to the Holders and to
securities analysts and prospective investors, upon their request, the
information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act and including any information that would be required by clause
(ii) of Section 4.03(a) hereof. (c) Delivery of such reports, information and
documents to the Trustee is for informational purposes only and the Trustee's
receipt of such shall not constitute constructive notice of any information
contained therein or determinable from information contained therein, including
the Company's compliance with any of its covenants hereunder (as to which the
Trustee is entitled to conclusively rely exclusively on Officers' Certificates).
Section 4.04 Compliance Certificate.
(a) The Company shall deliver to the Trustee, within 90 days
after the end of each fiscal year ending after the Issue Date, a certificate
from the principal executive officer, principal financial officer or principal
accounting officer stating that a review of the activities of the Company and
its Restricted Subsidiaries during the preceding fiscal year has been made under
the supervision of the signing Officers with a view to determining whether the
Company has kept, observed, performed and fulfilled its obligations under this
Indenture, and further stating, as to each such Officer signing such
certificate, that to the best of his or her knowledge the Company has kept,
observed, performed and fulfilled each and every condition and covenant
contained in this Indenture and is not in default in the performance or
observance of any of the terms, provisions, covenants and conditions of this
Indenture (or, if a Default or Event of Default shall have occurred, describing
all such Defaults or Events of Default of which he or she may have knowledge and
what action the Company is taking or proposes to take with respect thereto).
(b) When any Default or Event of Default has occurred and is
continuing under this Indenture, or if the Trustee or the holder of any other
evidence of Indebtedness of the Company or any Subsidiary gives any notice or
takes any other action with respect to a claimed Default or Event of Default,
the Company shall as soon as practicable (and, in any event, within 10 days
after the Company's knowledge thereof) deliver to the Trustee by registered or
certified mail or by facsimile transmission an Officers' Certificate specifying
such event and what action the Company proposes to take with respect thereto.
Section 4.05 Taxes.
The Company shall pay, and shall cause each of its Restricted
Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and
governmental levies except such as are contested in good faith and by
appropriate negotiations or proceedings or where the failure to effect such
payment is not adverse in any material respect to the Holders of the Notes.
Section 4.06 Stay, Extension and Usury Laws.
The Company covenants (to the extent that it may lawfully do
so) that it shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay, extension or
usury law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Indenture; and the Company (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it shall not, by resort to any
such law, hinder, delay or impede the execution of any power herein granted to
the Trustee, but shall suffer and permit the execution of every such power as
though no such law has been enacted.
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Section 4.07 Restricted Payments.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly:
(i) declare or pay any dividend or make any other payment or
distribution on account of the Company's or any of its Restricted
Subsidiaries' Equity Interests (including, without limitation, any
payment in connection with any merger, amalgamation or consolidation
involving the Company or any of its Restricted Subsidiaries) or to the
direct or indirect holders of the Company's or any of its Restricted
Subsidiaries' Equity Interests in their capacity as such (other than
dividends or distributions payable in Equity Interests (other than
Disqualified Stock) of the Company or to the Company or a Restricted
Subsidiary);
(ii) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger,
amalgamation or consolidation involving the Company) any Equity
Interests of the Company or any direct or indirect parent of the
Company;
(iii) make any payment on or with respect to, or purchase,
redeem, defease or otherwise acquire or retire for value any
Indebtedness that is subordinated to the Notes or the Subsidiary
Guarantees, except a payment of interest or principal at the Stated
Maturity thereof or any payment on Indebtedness permitted under Section
4.09(b)(6) hereof; or
(iv) make any Restricted Investment (all such payments and
other actions set forth in these clauses (i) through (iv) above being
collectively referred to as "Restricted Payments"),
unless, at the time of and after giving effect to such Restricted Payment:
(1) no Default or Event of Default has occurred and is
continuing or would occur as a consequence of such Restricted Payment;
and
(2) the Company would, at the time of such Restricted Payment
and after giving pro forma effect thereto as if such Restricted Payment
had been made at the beginning of the applicable four-quarter period,
have been permitted to incur at least $1.00 of additional Indebtedness
pursuant to Section 4.09(a) hereof; and
(3) such Restricted Payment, together with the aggregate
amount of all other Restricted Payments made by the Company and its
Restricted Subsidiaries after March 3, 2004 (excluding Restricted
Payments permitted by clauses (2), (3), (5), (6) and (7)(ii) of Section
4.07(b) hereof), is less than the sum, without duplication, of:
(i) 50% of the Consolidated Net Income of the Company for
the period (taken as one accounting period) beginning on
January 1, 2004 to the end of the Company's most recently
ended fiscal quarter for which internal financial statements
are available at the time of such Restricted Payment (or, if
such Consolidated Net Income for such period is a deficit,
less 100% of such deficit), excluding any charges incurred in
connection with the Company's purchase of its 12 1/2% Senior
Secured Notes due July 15, 2007 and 13.875% Senior Secured
Notes due July 15, 2007 pursuant to the Company's Offer to
Purchase and Consent Solicitation Statement, dated February
17, 2004, plus
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(ii) 100% of the aggregate net cash proceeds received by
the Company since March 3, 2004 as a contribution to its
common equity capital or from the issue or sale of Equity
Interests of the Company (other than Disqualified Stock) or
from the issue or sale of convertible or exchangeable
Disqualified Stock or convertible or exchangeable debt
securities of the Company that have been converted into or
exchanged for such Equity Interests (other than Equity
Interests (or Disqualified Stock or debt securities) sold to a
Subsidiary of the Company), plus
(iii) to the extent that any Restricted Investment that
was made after March 3, 2004 is sold for cash or otherwise
liquidated or repaid for cash or, in the case of a Restricted
Investment that is a Guarantee, released, the lesser of (A)
the cash return of capital with respect to such Restricted
Investment (less the cost of disposition, if any) and (B) the
initial amount of such Restricted Investment, less, in the
case of a Guarantee, any amounts paid under such Guarantee,
plus
(iv) to the extent that any Unrestricted Subsidiary of the
Company is redesignated as a Restricted Subsidiary after March
3, 2004, the lesser of (A) the fair market value of the
Company's Investment in such Subsidiary as of the date of such
redesignation and (B) such fair market value as of the date on
which such Subsidiary was originally designated as an
Unrestricted Subsidiary, plus
(v) US$15.0 million.
(b) So long as no Default has occurred and is continuing or
would be caused thereby, Section 4.07(a) hereof will not prohibit:
(1) the payment of any dividend within 60 days after the date
of declaration of the dividend, if at the date of declaration the
dividend payment would have complied with the provisions of this
Indenture;
(2) the redemption, repurchase, retirement, defeasance or
other acquisition of any subordinated Indebtedness of the Company or
any Restricted Subsidiary or of any Equity Interests of the Company in
exchange for, or out of the net cash proceeds of the substantially
concurrent sale (other than to a Restricted Subsidiary of the Company)
of, Equity Interests of the Company (other than Disqualified Stock);
provided that the amount of any such net cash proceeds that are
utilized for any such redemption, repurchase, retirement, defeasance or
other acquisition will be excluded from clause (3)(ii) of Section
4.07(a) hereof;
(3) the defeasance, redemption, repurchase or other
acquisition of subordinated Indebtedness of the Company or any
Restricted Subsidiary with the net cash proceeds from an incurrence of
Permitted Refinancing Indebtedness;
(4) the payment of any dividend by a Restricted Subsidiary of
the Company that is not a Wholly Owned Restricted Subsidiary to the
holders of its Equity Interests on a pro rata basis;
(5) an Investment by the Company that increases the ownership
interest of the Company in the High Level Project out of the net cash
proceeds of the substantially concurrent sale (other than from or to a
Subsidiary or from or to an employee stock ownership plan financed by
loans from the Company or a Subsidiary of the Company) of Equity
Interests (other than Dis-
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qualified Stock) of the Company; provided that the amount of any such
net cash proceeds that are utilized for any such Investment will be
excluded from clause (3)(ii) of Section 4.07(a) hereof;
(6) repurchases of Equity Interests deemed to occur upon the
exercise of stock options; and
(7) payments of (i) dividends on, and (ii) the repurchase,
redemption or acquisition at the scheduled maturity, scheduled
repayment or scheduled sinking fund date of, Disqualified Stock, the
incurrence of which was permitted by this Indenture.
(c) The amount of all Restricted Payments (other than cash)
will be the fair market value on the date of the Restricted Payment of the
asset(s) or securities proposed to be transferred or issued by the Company or
such Restricted Subsidiary, as the case may be, pursuant to the Restricted
Payment. The fair market value of any assets or securities that are required to
be valued by this covenant will be determined by the Board of Directors whose
resolution with respect thereto will be delivered to the Trustee. The Board of
Directors' determination must be based upon an opinion or appraisal issued by an
accounting, appraisal or investment banking firm of national standing in Canada
or the United States if the fair market value exceeds US$10.0 million. Not later
than the date of making any Restricted Payment, other than a Restricted Payment
under clauses (2), (3), (4) and (6) of Section 4.07(b) hereof, which, together
with any Restricted Payments not previously reported pursuant to this sentence,
exceeds US$2.0 million, the Company will deliver to the Trustee an Officers'
Certificate stating that such Restricted Payment is permitted and setting forth
the basis upon which the calculations required by this Section 4.07 were
computed, together with a copy of any fairness opinion or appraisal required by
this Indenture.
Section 4.08 Dividend and Other Payment Restrictions Affecting Restricted
Subsidiaries.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, create or permit to exist or
become effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to:
(1) pay dividends or make any other distributions on its
Capital Stock to the Company or any of its Restricted Subsidiaries, or
with respect to any other interest or participation in, or measured by,
its profits, or pay any indebtedness owed to the Company or any of its
Restricted Subsidiaries;
(2) make loans or advances to the Company or any of its
Restricted Subsidiaries; or
(3) transfer any of its properties or assets to the Company or
any of its Restricted Subsidiaries.
(b) Notwithstanding the foregoing, Section 4.08(a) will not
apply to encumbrances or restrictions existing under or by reason of:
(1) agreements governing Existing Indebtedness and Credit
Facilities (provided that, with respect to Credit Facilities, such
encumbrances and restrictions are not materially more restrictive,
taken as a whole, than customary provisions in comparable financings)
and any amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings of those
agreements, provided that the amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacements or
refinancings of such instrument are
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no more restrictive, taken as a whole, with respect to such dividend
and other payment restrictions than those contained in such agreement
on the Issue Date or in such Credit Facilities;
(2) this Indenture, the Notes and any Subsidiary Guarantee or
any other instrument governing debt securities of the Company incurred
in compliance with Section 4.09 hereof that are no more restrictive,
taken as a whole, than those contained in this Indenture, the Notes and
any Subsidiary Guarantee;
(3) applicable law;
(4) any instrument governing Indebtedness or Capital Stock of
a Person acquired by the Company or any of its Restricted Subsidiaries
as in effect at the time of such acquisition (except to the extent such
Indebtedness was incurred or such Capital Stock was issued in
connection with or in contemplation of such acquisition), which
encumbrance or restriction is not applicable to any Person, or the
properties or assets of any Person, other than the Person, or the
property or assets of the Person, so acquired, provided that, in the
case of Indebtedness, such Indebtedness was permitted by the terms of
this Indenture to be incurred;
(5) customary non-assignment provisions in leases entered into
in the ordinary course of business;
(6) purchase money obligations and Capital Lease Obligations
for property acquired in the ordinary course of business that impose
restrictions on that property of the nature described in Section
4.08(a)(3) hereof;
(7) any agreement for the sale or other disposition of Capital
Stock or assets of a Restricted Subsidiary that restricts distributions
by that Restricted Subsidiary pending its sale or other disposition;
(8) Permitted Refinancing Indebtedness, provided that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are no more restrictive, taken as a whole,
than those contained in the agreements governing the Indebtedness being
refinanced;
(9) Liens securing Indebtedness otherwise permitted to be
incurred under Section 4.12 hereof that limit the right of the debtor
to dispose of the assets subject to such Liens;
(10) restrictions on cash or other deposits imposed by
customers under contracts entered into in the ordinary course of
business;
(11) restrictions contained in agreements between Grant and
the Company or a Restricted Subsidiary with respect to the High Level
Project, as extended, amended, restated, modified or replaced from time
to time on terms that are no more restrictive, taken as a whole, than
those contained in such agreements as of the Issue Date; and
(12) provisions with respect to the disposition or
distribution of assets or property in Permitted Joint Venture
agreements.
Section 4.09 Incurrence of Indebtedness and Issuance of Preferred Stock.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, create, incur,
issue, assume, guarantee or otherwise become directly or indirectly
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liable, contingently or otherwise, with respect to (collectively, "incur") any
Indebtedness (including Acquired Indebtedness), and the Company will not issue
any Disqualified Stock and will not permit any of its Restricted Subsidiaries to
issue any shares of preferred stock; provided, however, that the Company or any
Guarantor may incur Indebtedness (including Acquired Indebtedness) or the
Company may issue Disqualified Stock and any Guarantor may issue shares of
preferred stock, if the Fixed Charge Coverage Ratio for the Company's most
recently ended four full fiscal quarters for which internal financial statements
are available immediately preceding the date on which such additional
Indebtedness is incurred or such Disqualified Stock or preferred stock is issued
would have been at least 2.0 to 1, determined on a pro forma basis (including a
pro forma application of the net proceeds therefrom), as if the additional
Indebtedness had been incurred or the Disqualified Stock or preferred stock had
been issued, as the case may be, at the beginning of such four-quarter period.
(b) Notwithstanding the foregoing, Section 4.09(a) hereof will
not prohibit the incurrence of any of the following items of Indebtedness
(collectively, "Permitted Indebtedness"):
(1) the incurrence by the Company or any of the Guarantors of
Indebtedness and letters of credit under Credit Facilities, in an
aggregate principal amount at any one time outstanding under this
clause (1) (with letters of credit being deemed to have a principal
amount equal to the maximum potential liability of the Company and the
Guarantors thereunder) not to exceed the greater of:
(i) $50.0 million less the aggregate amount of all Net
Proceeds of Asset Sales applied by the Company or any of its
Restricted Subsidiaries since the Issue Date to repay term
Indebtedness under a Credit Facility or to repay revolving
credit Indebtedness and effect a corresponding commitment
reduction under a Credit Facility, in each case, pursuant to
Section 4.10 hereof; or
(ii) the amount of the Borrowing Base as of the date of
such incurrence;
(2) the incurrence by the Company and its Restricted
Subsidiaries of Existing Indebtedness;
(3) the Initial Fixed Rate Notes and Initial Floating Rate
Notes and the Exchange Notes with respect to each to be issued pursuant
to the Registration Rights Agreement and any related Subsidiary
Guarantees;
(4) the incurrence by the Company or any Restricted Subsidiary
of Indebtedness represented by Capital Lease Obligations, mortgage
financings or purchase money obligations, in each case, incurred for
the purpose of financing all or any part of the purchase price or cost
of construction or improvement of property, plant or equipment used in
the business of the Company or such Restricted Subsidiary, in an
aggregate principal amount, including all Permitted Refinancing
Indebtedness incurred to refund, refinance or replace any Indebtedness
incurred pursuant to this clause (4), not to exceed, at any time
outstanding, the greater of (i) US$10.0 million and (ii) 2% of the
Consolidated Net Tangible Assets of the Company;
(5) the incurrence by the Company or any of its Restricted
Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or
the net proceeds of which are used to refund, refinance or replace
Indebtedness (other than intercompany Indebtedness) that was permitted
by this Indenture to be incurred under clause (a) of Section 4.09
hereof or clause (2), (3), (4), or (13) of this Section 4.09(b);
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(6) the incurrence by the Company of Indebtedness to, or the
issuance of Disqualified Stock to, any Wholly Owned Restricted
Subsidiary of the Company or the incurrence by any Restricted
Subsidiary of the Company of Indebtedness to, or the issuance of
preferred stock to, the Company or any Wholly Owned Restricted
Subsidiary of the Company; provided, however, that:
(i) such Indebtedness owing by the Company or a Guarantor
to a Wholly Owned Restricted Subsidiary of the Company must be
expressly subordinated to the prior payment in full in cash of
all Obligations with respect to the Notes, in the case of the
Company, or the Subsidiary Guarantee, in the case of a
Guarantor; and
(ii) (A) any subsequent issuance or transfer of Equity
Interests that results in any such Indebtedness, Disqualified
Stock or preferred stock being held by a Person other than the
Company or a Wholly Owned Restricted Subsidiary of the Company
and (B) any sale or other transfer of any such Indebtedness,
Disqualified Stock or preferred stock to a Person that is not
either the Company or a Wholly Owned Restricted Subsidiary of
the Company; will be deemed, in each case, to constitute an
incurrence of such Indebtedness or issuance of Disqualified
Stock or preferred stock by the Company or such Restricted
Subsidiary, as the case may be, that was not permitted by this
clause (6);
(7) the incurrence by the Company or any of its Restricted
Subsidiaries of Hedging Obligations in the ordinary course of business
and not for speculative purposes;
(8) the guarantee by the Company or any of the Guarantors of
Indebtedness of the Company or a Guarantor of the Company that was
permitted to be incurred by another provision of this Section 4.09;
(9) the accrual of interest, the accretion or amortization of
original issue discount, the payment of interest on any Indebtedness in
the form of additional Indebtedness with the same terms, and the
payment of dividends on Disqualified Stock or preferred stock in the
form of additional shares of the same class of Disqualified Stock or
preferred stock will not be deemed to be an incurrence of Indebtedness
or an issuance of Disqualified Stock or preferred stock for purposes of
this Section 4.09; provided, in each such case, that the amount thereof
is included in the Fixed Charges of the Company as accrued;
(10) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness in respect of statutory obligations, bid,
performance, surety and appeal bonds and trade and standby letters of
credit, in each case entered into in the ordinary course of business
and consistent with past practice;
(11) Indebtedness of the Company or any Restricted Subsidiary
consisting of guarantees, indemnities or obligations in respect of
purchase price adjustments in connection with the acquisition or
disposition of assets, including, without limitation, Equity Interests,
in accordance with the provisions of this Indenture;
(12) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness to fund a purchase by the Company or a
Restricted Subsidiary of Grant's interest in the High Level Project
pursuant to a Right of First Refusal initiated by Grant or the Buy/Sell
Option; provided that (i) (x) the Company or such Restricted Subsidiary
has accepted an offer from any Person, other than the Company or a
Restricted Subsidiary, to purchase the interest in the High Level
Project that is acquired from Grant at a concurrent closing for an
amount not less than the
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purchase price payable to Grant; and (y) such Indebtedness is repaid in
full at such concurrent closing from the transfer of the interest in
the High Level Project purchased from Grant at such closing; or (ii)
there shall not have been a decrease in the rating of the Notes by any
Rating Agency by one or more Rating Categories that occurs within 90
days (which period shall be extended so long as the rating of the Notes
is under publicly announced consideration for a possible downgrade by
any Rating Agency) after the date of the later of (A) notice to the
public or the Rating Agencies of the intention of the Company or any of
its Restricted Subsidiaries to incur Indebtedness to fund such a
purchase or (B) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness to fund such a purchase; and
(13) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness in an aggregate principal
amount (or accreted value, as applicable) at any time outstanding,
including all Permitted Refinancing Indebtedness incurred to refund,
refinance or replace any Indebtedness incurred pursuant to this clause
(13), not to exceed US$50.0 million.
(c) The Company will not, and will not permit any Guarantor
to, incur any Indebtedness (including Permitted Indebtedness) that is
contractually subordinated in right of payment to any other Indebtedness of the
Company or such Guarantor unless such Indebtedness is also contractually
subordinated in right of payment to the Notes or the applicable Subsidiary
Guarantee on substantially identical terms; provided, however, that Indebtedness
of the Company or a Guarantor will not be deemed to be contractually
subordinated in right of payment to any other Indebtedness of the Company or
such Guarantor solely by virtue of being unsecured.
(d) For purposes of determining compliance with this Section
4.09, in the event that an item of proposed Indebtedness meets the criteria of
more than one of the categories of Permitted Indebtedness described in clauses
(1) through (13) of Section 4.09(b) hereof, or is entitled to be incurred
pursuant to Section 4.09(a) hereof, the Company will be permitted to classify
such item of Indebtedness or later reclassify all or a portion of such item of
Indebtedness in any manner that complies with this Section 4.09. Indebtedness
under Credit Facilities outstanding on the date on which Notes are first issued
and authenticated under this Indenture will be deemed to have been incurred
pursuant to the category of Permitted Indebtedness described in Section
4.09(b)(1) hereof.
Section 4.10 Asset Sales.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, consummate an Asset Sale in any single transaction
or series of related transactions unless:
(1) the Company (or the Restricted Subsidiary, as the case may
be) receives consideration at the time of the Asset Sale at least equal
to the fair market value of the assets or Equity Interests issued or
sold or otherwise disposed of;
(2) the fair market value is determined by the Company's Board
of Directors and evidenced by a resolution of the Board of Directors
set forth in an Officers' Certificate delivered to the Trustee; and
(3) at least 75% of the consideration received in the Asset
Sale by the Company or such Restricted Subsidiary is in the form of (i)
cash, (ii) Cash Equivalents, (iii) the majority of the Voting Stock of
a Person engaged in a Permitted Business that will become on the date
of acquisition thereof a Restricted Subsidiary, or (iv) long-term
property or assets that are used or useful in a Permitted Business. For
purposes of this provision, each of the following will be deemed to be
cash:
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(A) any liabilities, as shown on the Company's or such
Restricted Subsidiary's most recent balance sheet, of the
Company or any Restricted Subsidiary (other than contingent
liabilities and liabilities that are by their terms
subordinated to the Notes or any Subsidiary Guarantee) that
are assumed by the transferee of any such assets pursuant to a
customary novation agreement or other agreement that releases
the Company or such Restricted Subsidiary from further
liability; and
(B) any securities, notes or other obligations received by
the Company or any such Restricted Subsidiary from such
transferee that are contemporaneously, subject to ordinary
settlement periods, converted by the Company or such
Restricted Subsidiary into cash or Cash Equivalents, to the
extent of the cash or Cash Equivalents received in that
conversion.
(b) In the case of consideration received in an Asset Sale in
a form specified in Section 4.10(a)(3)(iii) or 4.10(a)(3)(iv) hereof, the Board
of Directors' determination must be based upon an opinion or appraisal issued by
an accounting, appraisal or investment banking firm of national standing in
Canada or the United States if the fair market value exceeds US$10.0 million.
(c) Within 360 days after the receipt of any Net Proceeds from
an Asset Sale, the Company or such Restricted Subsidiary may apply those Net
Proceeds at its option:
(1) to repay term or revolving credit Indebtedness under or
cash collateralize letters of credit under a Credit Facility (other
than any such Indebtedness that is subordinate in right of payment to
the Notes or any Subsidiary Guarantee) and, if the Indebtedness repaid
is revolving credit Indebtedness, to correspondingly reduce commitments
with respect thereto;
(2) if the Asset Sale is by a Restricted Subsidiary that is
not a Guarantor, to repay, redeem or repurchase any Indebtedness of
that Restricted Subsidiary;
(3) to acquire all or substantially all of the assets of, or a
majority of the Voting Stock of, a Person engaged in a Permitted
Business;
(4) to make a capital expenditure; or
(5) to acquire other long-term assets that are used or useful
in a Permitted Business.
Pending the final application of any Net Proceeds, the Company or such
Restricted Subsidiary may temporarily reduce revolving credit borrowings or
otherwise invest the Net Proceeds in any manner that is not prohibited by this
Indenture.
(d) Any Net Proceeds from Asset Sales that are not applied or
invested as provided in Section 4.10(c) hereof and any Net Proceeds used to cash
collateralize letters of credit which no longer cash collateralize a letter of
credit and which have not otherwise been applied or invested as provided in
Section 4.10(c) hereof will constitute "Excess Proceeds." The Company may use
Excess Proceeds to make at any time, and when the aggregate amount of Excess
Proceeds exceeds US$10.0 million the Company will make, an offer to purchase (an
"Asset Sale Offer") to all Holders of Notes and all holders of other
Indebtedness that is pari passu with the Notes containing provisions similar to
those set forth in this Indenture with respect to offers to purchase or redeem
such indebtedness with the proceeds of sales of assets, to purchase the maximum
principal amount of Notes and such other pari passu Indebtedness that may be
purchased out of the Excess Proceeds. The offer price in any Asset Sale Offer
will be equal to 100% of the principal amount plus accrued and unpaid interest
and Special Interest, if any, to the date
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fixed for the closing of such offer, and will be payable in cash (the "Asset
Sale Payment"). If any Excess Proceeds remain after consummation of an Asset
Sale Offer, the Company or such Restricted Subsidiary may use those Excess
Proceeds for any purpose not otherwise prohibited by this Indenture. If the
aggregate principal amount of Notes and other pari passu Indebtedness tendered
into such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee
will select the Notes and such other pari passu Indebtedness to be purchased on
a pro rata basis based on the principal amount of Notes and other pari passu
Indebtedness tendered. Upon completion of each Asset Sale Offer, the amount of
Excess Proceeds will be reset at zero.
(e) The Company will comply with the requirements of Rule
14e-1 under the Exchange Act and any other securities laws and regulations
thereunder to the extent those laws and regulations are applicable in connection
with each repurchase of Notes pursuant to an Asset Sale Offer. To the extent
that the provisions of any securities laws or regulations conflict with Sections
3.09 or 4.10 hereof, the Company will comply with the applicable securities laws
and regulations and will not be deemed to have breached its obligations
hereunder by virtue of such conflict.
Section 4.11 Transactions with Affiliates.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or
otherwise dispose of any of its properties or assets to, or purchase any
property or assets from, or enter into or make or amend any transaction,
contract, agreement, understanding, loan, advance or guarantee with, or for the
benefit of, any Affiliate (each, an "Affiliate Transaction"), unless:
(1) the Affiliate Transaction is on terms that are no less
favorable to the Company or the relevant Restricted Subsidiary than
those that could have been obtained in a comparable transaction by the
Company or such Restricted Subsidiary with an unrelated Person; and
(2) the Company delivers to the Trustee:
(i) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate
consideration in excess of US$5.0 million, a resolution of the
Board of Directors set forth in an Officers' Certificate
certifying that such Affiliate Transaction complies with this
Section 4.11 and that such Affiliate Transaction has been
approved by a majority of the disinterested members of the
Board of Directors; and
(ii) with respect to any Affiliate Transaction or series
of related Affiliate Transactions involving aggregate
consideration in excess of US$15.0 million, an opinion issued
by an accounting, appraisal or investment banking firm of
national standing in Canada or the United States stating that
such Affiliate Transaction is on terms that are no less
favorable to the Company or the relevant Restricted Subsidiary
than those that could have been obtained in a comparable
transaction by the Company or such Restricted Subsidiary with
an unrelated person.
(b) The following items will not be deemed to be Affiliate
Transactions and, therefore, will not be subject to the provisions of Section
4.11(a) hereof:
(1) compensation, employment or indemnification agreements or
arrangements (including stock options) entered into by the Company or
any of its Restricted Subsidiaries in the ordinary course of business
of the Company or such Restricted Subsidiary;
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(2) transactions between or among the Company and/or its
Restricted Subsidiaries; provided that any transaction with a
Restricted Subsidiary that is not a Wholly Owned Restricted Subsidiary
shall be in the ordinary course of business and on terms that are no
less favorable to the Company or the relevant Restricted Subsidiary
than those that could have been obtained in a comparable transaction by
the Company or such Restricted Subsidiary with an unrelated Person;
(3) payment of reasonable directors fees to Persons who are
not otherwise Affiliates of the Company;
(4) sales of Equity Interests (other than Disqualified Stock)
to Affiliates of the Company;
(5) Permitted Investments or Restricted Payments that are
permitted by Section 4.07 hereof;
(6) the pledge of Equity Interests of Unrestricted
Subsidiaries to support the Indebtedness thereof;
(7) transactions undertaken pursuant to contractual
obligations in existence on the Issue Date and disclosed in the
Offering Memorandum, as extended, renewed, amended, restated, modified
or replaced from time to time on terms no less favorable, taken as a
whole, to the Company or the relevant Restricted Subsidiary than such
contractual obligations in existence on the Issue Date;
(8) transactions between or among the Company and/or its
Restricted Subsidiaries and Grant relating to the High Level Project in
the ordinary course of business of the Company or any such Restricted
Subsidiary and on terms that are no less favorable to the Company or
the relevant Restricted Subsidiary than those that could have been
obtained in a comparable transaction by the Company or such Restricted
Subsidiary with an unrelated Person;
(9) any purchase or sale by the Company made pursuant to the
Buy/Sell Option or the Right of First Refusal; and
(10) transactions between or among the Company and/or its
Restricted Subsidiaries and a Permitted Joint Venture on terms that are
no less favorable to the Company or the relevant Restricted Subsidiary
than those that could have been obtained in a comparable transaction by
the Company or such Restricted Subsidiary with an unrelated Person.
Section 4.12 Liens.
The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, create, incur, assume or
suffer to exist any Lien of any kind securing Indebtedness or Attributable Debt
on any asset now owned or hereafter acquired except Permitted Liens, unless it
has made or will make effective provision whereby the Notes or any Subsidiary
Guarantee will be secured by such Lien equally and ratably with (or, if such
other Indebtedness constitutes subordinated Indebtedness, prior to) all other
Indebtedness of the Company or any Restricted Subsidiary secured by such Lien
for so long as such other Indebtedness is secured by such Lien.
-53-
Section 4.13 Payments for Consent.
The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration, to or for the benefit of any Holder of Notes for or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture or the Notes unless such consideration is offered to be paid
to all Holders of the Notes and is paid to all Holders of the Notes that
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.
Section 4.14 Corporate Existence.
Subject to Article 5 hereof, the Company shall do or cause to
be done all things necessary to preserve and keep in full force and effect (i)
its corporate existence, and the corporate, partnership or other existence of
each of its Restricted Subsidiaries, in accordance with the respective
organizational documents (as the same may be amended from time to time) of the
Company or any such Restricted Subsidiary and (ii) the rights (charter and
statutory), licenses and franchises of the Company and its Restricted
Subsidiaries; provided that the Company shall not be required to preserve any
such right, license or franchise, or the corporate, partnership or other
existence of any of its Restricted Subsidiaries, if the Company in good faith
shall determine that the preservation thereof is no longer desirable in the
conduct of the business of the Company and its Restricted Subsidiaries, taken as
a whole, and that the loss thereof is not adverse in any material respect to the
Holders of the Notes.
Section 4.15 Change of Control.
(a) Upon the occurrence of a Change of Control, the Company
shall make an offer (a "Change of Control Offer") to each Holder to repurchase
all or any part (equal to US$1,000 or an integral multiple thereof) of each
Holder's Notes at a purchase price in cash equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest and Special Interest,
if any, thereon, to the date of repurchase (the "Change of Control Payment").
(b) Within 10 days following a Change of Control, the Company
will mail a notice to each Holder describing the transaction or transactions
that constitute the Change of Control and offering to repurchase Notes on a date
specified in the notice, which date will be no earlier than 30 days and no later
than 60 days from the date the notice is mailed, pursuant to the procedures
required by Section 3.09 hereof and described in the notice. Any Change of
Control Offer shall be made in accordance with Section 3.09 hereof. 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 repurchase of Notes as a
result of a Change of Control. To the extent that the provisions of any
securities laws or regulations conflict with Sections 3.09 or 4.15 of this
Indenture, the Company will comply with the applicable securities laws and
regulations and will not be deemed to have breached its obligations hereunder by
virtue of such conflict.
(c) Notwithstanding anything to the contrary in this Section
4.15, the Company shall not be required to make a Change of Control Offer upon a
Change of Control if a third party makes the Change of Control Offer in the
manner, at the times and otherwise in compliance with the requirements set forth
in this Section 4.15 and Section 3.09 hereof and all other provisions of this
Indenture applicable to a Change of Control Offer made by the Company and
purchases all Notes properly tendered and not withdrawn under the Change of
Control Offer.
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Section 4.16 Additional Subsidiary Guarantees.
If (i) the Company or any of its Restricted Subsidiaries
acquires or creates a North American Restricted Subsidiary, other than a
Non-Guarantor Restricted Subsidiary, after the Issue Date or (ii) the aggregate
amount of assets held by all Non-Guarantor Restricted Subsidiaries exceeds
US$3.0 million, then that newly acquired or created Subsidiary, in the case of
clause (i), will become a Guarantor, and in the case of clause (ii), such of the
Non-Guarantor Restricted Subsidiaries will become a Guarantor as is necessary so
that after giving effect to the issuance of such guarantees, the remaining
Non-Guarantor Restricted Subsidiaries will have aggregate assets of less than
US$3.0 million. In each case, such Restricted Subsidiary shall execute a
guarantee and supplemental indenture in the form of Exhibit E and Exhibit F
hereto and deliver to the Trustee an Opinion of Counsel within 10 Business Days
of the date on which it was acquired or created, or required to become a
Guarantor, as the case may be, to the effect that such supplemental indenture
has been duly authorized and constitutes a valid, binding and enforceable
obligation of such Restricted Subsidiary; provided, however, that all
Subsidiaries that have properly been designated as Unrestricted Subsidiaries in
accordance with this Indenture for so long as they continue to constitute
Unrestricted Subsidiaries will not have to comply with this Section 4.16.
Section 4.17 Designation of Restricted and Unrestricted Subsidiaries.
The Board of Directors of the Company may designate any
Restricted Subsidiary of the Company to be an Unrestricted Subsidiary if that
designation would not cause a Default. If a Restricted Subsidiary is designated
as an Unrestricted Subsidiary, the aggregate fair market value of all
outstanding Investments owned by the Company and its Restricted Subsidiaries in
the Subsidiary properly designated shall be deemed to be an Investment made as
of the time of the designation and shall reduce the amount available for
Restricted Payments under Section 4.07(a) hereof or Permitted Investments. That
designation shall only be permitted if the Investment would be permitted at that
time and if the Restricted Subsidiary otherwise meets the definition of an
Unrestricted Subsidiary. In addition, no such designation may be made unless the
proposed Unrestricted Subsidiary does not own any Capital Stock in any
Restricted Subsidiary that is not simultaneously subject to designation as an
Unrestricted Subsidiary. The Board of Directors of Xxxxxxxxx may redesignate any
Unrestricted Subsidiary to be a Restricted Subsidiary if the redesignation would
not cause a Default.
Section 4.18 Additional Amounts.
(a) All amounts paid or credited by the Company under or with
respect to the Notes, or by any Guarantor pursuant to the Subsidiary Guarantees,
will be made free and clear of and without withholding or deduction for or on
account of any present or future tax, duty, levy, impost, assessment or other
governmental charge (including penalties, interest and other liabilities or
expenses related thereto) imposed or levied by or on behalf of the Government of
Canada or of any province or territory thereof or by any authority or agency
therein or thereof having power to tax (hereinafter, the "Taxes"), unless the
Company or such Guarantor, as the case may be, is required to withhold or deduct
any amount for or an account of Taxes by law or by the interpretation or
administration thereof. If the Company or any Guarantor is required to withhold
or deduct any amount for or on account of Taxes from any amount paid or credited
under or with respect to the Notes or the Subsidiary Guarantees, the Company or
such Guarantor will pay such additional amounts (the "Additional Amounts") as
may be necessary so that the net amount received by each owner of a beneficial
interest in the Notes (an "owner" for the purposes of this Section 4.18)
(including Additional Amounts) after such withholding or deduction (including
any withholding or deduction in respect of Additional Amounts) will not be less
than the amount such owner would have received if such Taxes had not been
withheld or deducted; provided, however, that no Additional Amounts will be
payable with respect to a payment or credit made to an owner (an "Excluded
Holder") (or to a
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Holder on behalf of an Excluded Holder) (i) with which the Company or such
Guarantor does not deal at arm's length (within the meaning of the Income Tax
Act (Canada)) at the time of making such payment, (ii) which is subject to such
Taxes by reason of such owner being connected with Canada or any province or
territory thereof otherwise than solely by reason of the owner's activity in
connection with purchasing the Notes, by the mere holding of Notes or by reason
of the receipt of payments thereunder or the enforcement of the Holder's or
owner's rights thereunder, (iii) which failed to duly and timely comply with a
timely request of the Company to provide information, documents, certification
or other evidence concerning such owner's nationality, residence, entitlement to
treaty benefits, identity or connection with Canada or any political subdivision
or authority thereof, if and to the extent that due and timely compliance with
such request would have resulted in the reduction or elimination of any Taxes as
to which Additional Amounts would have otherwise been payable to such owner or
Holder on behalf of such owner of Notes but for this clause (iii), (iv) which is
a fiduciary, a partnership or not the beneficial owner of any payment or credit
on a Note, if and to the extent that any beneficiary or settlor of such
fiduciary, any partner in such partnership or the beneficial owner of such
payment (as the case may be) would not have been entitled to receive Additional
Amounts with respect to such payment if such beneficiary, settlor, partner or
beneficial owner had been the Holder of such Note or (v) any combination of the
foregoing numbered clauses of this proviso. The Company or such Guarantor will
also (a) make such withholding or deduction and (b) remit the full amount
deducted or withheld to the relevant authority in accordance with and in the
time required under applicable law.
(b) The Company or the Guarantor will furnish the Holders of
the Notes, within 30 days after the date the payment of any Taxes is due
pursuant to applicable law, evidence of such payment by the Company or such
Guarantor. In the event that the Company or the Guarantor fails to remit any
Taxes in respect of which Additional Amounts are payable, the Company or the
Guarantor will indemnify and hold harmless each owner of a beneficial interest
in the Notes (other than an Excluded Holder or owner to the extent that such
owner has already received Additional Amounts in respect of the relevant payment
or credit) and will, upon written request of a Holder on behalf of an owner
(other than an Excluded Holder), reimburse each such Holder or owner for the
amount of (i) any Taxes so levied or imposed and paid by such Holder or owner as
a result of payments or credits made under or with respect to the Notes or the
Subsidiary Guarantees, and (ii) any Taxes so levied or imposed with respect to
any reimbursement under the foregoing clause (i) but excluding any such Taxes on
the net income of such Holder or owner so that the net amount received by such
Holder or owner (net of payments made under or with respect to the Notes or
Subsidiary Guarantees) after such reimbursement will not be less than the net
amount the Holder or owner would have received if Taxes on such reimbursement
had not been imposed.
(c) At least 30 days prior to each date on which any payment
under or with respect to the Notes is due and payable, if the Company or any
Guarantor will be obligated to pay Additional Amounts with respect to such
payment, the Company or such Guarantor will deliver to the Trustee an Officers'
Certificate stating the fact that such Additional Amounts will be payable and
the amounts so payable and will set forth such other information necessary to
enable the Trustee to pay such Additional Amounts to Holders or owners on the
payment date. Whenever in this Indenture there is mentioned, in any context, the
payment of principal, premium, if any, redemption price, Change of Control
Payment, Asset Sale Payment, interest, Special Interest or any other amount
payable under or with respect to any Note, such mention shall be deemed to
include mention of the payment of Additional Amounts to the extent that, in such
context, Additional Amounts are, were or would be payable in respect thereof.
(d) The Company or a Guarantor will pay any present or future
stamp, court, documentary or other similar Taxes, charges or levies that arise
in any taxing jurisdiction from the execution, delivery or registration of, or
enforcement of rights under, the Notes, this Indenture, any Subsidiary Guarantee
or any related document ("Documentary Taxes").
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(e) The obligation to pay any Additional Amounts (and any
associated reimbursement) and Documentary Taxes under the terms and conditions
described above will survive any termination, defeasance or discharge of this
Indenture.
Section 4.19 Limitation on Guarantees by Restricted Subsidiaries.
If any Restricted Subsidiary of the Company that is not a
Guarantor directly or indirectly Guarantees the payment of any Indebtedness of
the Company or a Guarantor, that Restricted Subsidiary will become a Guarantor
and execute a guarantee and supplemental indenture in the form of Exhibit E and
Exhibit F hereto and deliver to the Trustee an Opinion of Counsel within 10
Business Days of the date on which it entered into such Guarantee to the effect
that such supplemental indenture has been duly authorized and constitutes a
valid, binding and enforceable obligation of such Restricted Subsidiary. If the
Restricted Subsidiary is released from its Guarantee of such other Indebtedness
of the Company, it will automatically be released from its obligations as a
Guarantor.
Section 4.20 Money for Security Payments to Be Held in Trust.
(a) If the Company or any of its Restricted Subsidiaries shall
at any time act as Paying Agent hereunder, it shall, on or before each due date
of the principal of (and premium, if any) or interest and Special Interest, if
any, on any of the Notes, segregate and hold in trust for the benefit of the
Person entitled thereto a sum sufficient to pay the principal (and premium, if
any) or interest so becoming due until such sums shall be paid to such Persons
or otherwise disposed of as herein provided, and shall promptly notify the
Trustee of its action or failure so to act.
(b) Whenever the Company shall have one or more Paying Agents
for the Notes, it shall, on or before each due date of the principal of (and
premium, if any) or interest and Special Interest, if any, on any Notes, deposit
with a Paying Agent a sum in same day funds (or New York Clearing House funds if
such deposit is made prior to the date on which such deposit is required to be
made) sufficient to pay the principal (and premium, if any) or interest and
Special Interest, if any, so becoming due, such sum to be held in trust for the
benefit of the Persons entitled to such principal, premium or interest and the
Company shall promptly notify the Trustee of such action or any failure so to
act.
(c) The Company shall cause each Paying Agent other than the
Trustee to execute and deliver to the Trustee an instrument in which such Paying
Agent shall agree with the Trustee, subject to the provisions of this Section
4.20, that such Paying Agent shall:
(i) hold all sums held by it for the payment of the principal
of (and premium, if any) or interest and Special Interest, if any, on
Notes in trust for the benefit of the Persons entitled thereto until
such sums shall be paid to such Persons or otherwise disposed of as
herein provided;
(ii) give the Trustee notice of any default by the Company (or
any other obligor upon the Notes) in the making of any payment of
principal (and premium, if any) or interest and Special Interest, if
any; and
(iii) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such
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paying Agent, such sums to be held by the Trustee upon the same trusts as those
upon which such sums were held by the Company or such Paying Agent; and upon
such payment by any Paying Agent to the Trustee, such Paying Agent shall be
released from all further liability with respect to such money.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of (and
premium, if any) or interest and Special Interest, if any, on any Note and
remaining unclaimed for two years after such principal (and premium, if any) or
interest and Special Interest, if any has become due and payable shall be paid
to the Company on Company request, unless an abandoned property law designates
another person, or (if then held by the Company) shall be discharged from such
trust; and the Holder of such Note shall thereafter, as an unsecured general
creditor, look only to the Company for payment thereof, and all liability of the
Trustee or such Paying Agent with respect to such trust money, and all liability
of the Company as trustee thereof, shall thereupon cease; provided that the
Trustee or such Paying Agent, before being required to make any such repayment,
shall at the written direction and at the expense of the Company, cause to be
published once, in the New York Times, The Wall Street Journal (national
edition), the Globe and Mail and the National Post, notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such publication, any unclaimed balance of
such money then remaining will be repaid to the Company.
Section 4.21 Maintenance of Properties.
The Company shall cause all properties owned by the Company or
any Restricted Subsidiary and used or useful in the conduct of its business or
the business of any Restricted Subsidiary to be maintained and kept in good
condition, repair and working order (reasonable wear and tear excepted) and
supplied with all necessary equipment and shall cause to be made all necessary
repairs, renewals, replacements, betterments and improvements thereof, all as in
the judgment of the Company may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all times;
provided, however, that nothing in this Section 4.21 shall prevent the Company
or any Restricted Subsidiary from discontinuing the maintenance of any of such
properties if such discontinuance is, as determined by the Company or such
Restricted Subsidiary in good faith, desirable in the conduct of its business or
the business of any Restricted Subsidiary and not disadvantageous in any
material respect to the Holders.
Section 4.22 Maintenance of Insurance.
The Company shall, and shall cause its Restricted Subsidiaries
to, keep at all times all of their properties which are of an insurable nature
insured (which may include self-insurance) against loss or damage with insurers
believed by the Company to be responsible to the extent that property of similar
character is usually so insured or self-insured by corporations similarly
situated and owning like properties in accordance with customary business
practices.
Section 4.23 Certain Fall-Away Covenants.
(a) During any period of time that (i) the Notes have
Investment Grade Ratings from both Rating Agencies and (ii) no Default or Event
of Default has occurred and is continuing hereunder, the Company and its
Restricted Subsidiaries will not be subject to Sections 4.07 (except to the
extent applicable under Section 4.17), 4.08, 4.09, 4.10, 4.11 and 4.15
(collectively, the "Fall-Away Covenants") hereof and Sections 6.01(a)(3) and
6.01(a)(4) hereof, to the extent that such Sections 6.01(a)(3) and 6.01(a)(4)
apply to such Fall-Away Covenants.
(b) If the Company and its Restricted Subsidiaries are not
subject to the Fall-Away Covenants for any period of time as a result of the
previous sentence (a "Fall-Away Period") and,
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subsequently, one, or both, of the Rating Agencies withdraws its ratings or
downgrades the ratings assigned to the Notes below the required Investment Grade
Ratings or a Default or Event of Default occurs and is continuing, then the
Company and its Restricted Subsidiaries will thereafter again be subject to the
Fall-Away Covenants. The ability of the Company and its Restricted Subsidiaries
to make Restricted Payments after the time of such withdrawal, downgrade,
Default or Event of Default will be calculated as if Section 4.07 had been in
effect during the entire period of time from the Issue Date. Notwithstanding the
foregoing, the continued existence after the end of the Fall-Away Period of
facts and circumstances or obligations arising from transactions which occurred
during a Fall-Away Period shall not constitute a breach of any covenant set
forth in this Indenture or cause a Default or Event of Default thereunder;
provided that (i) the Company and its Restricted Subsidiaries did not incur or
otherwise cause such facts and circumstances or obligations to exist in
anticipation of (x) a ratings withdrawal or downgrade below an Investment Grade
Rating or (y) a Default or Event of Default and (ii) the Company and its
Restricted Subsidiaries did not reasonably believe that such transactions would
result in such withdrawal or downgrade, Default or Event of Default.
ARTICLE 5
SUCCESSORS
Section 5.01 Merger, Amalgamation, Consolidation or Sale of Assets.
(a) The Company will not, directly or indirectly: (i)
consolidate, amalgamate with or merge with or into another Person (whether or
not the Company is the surviving corporation); or (ii) sell, assign, transfer,
convey or otherwise dispose of all or substantially all of the properties or
assets of the Company and its Restricted Subsidiaries taken as a whole, in one
or more related transactions, to another Person, unless:
(1) either: (x) the Company is the surviving corporation; or
(y) the Person formed by or surviving any such consolidation,
amalgamation or merger (if other than the Company) or to which such
sale, assignment, transfer, conveyance or other disposition has been
made is a corporation organized or existing under the laws of Canada or
any province or territory thereof, the United States, any state of the
United States or the District of Columbia;
(2) the Person formed by or surviving any such consolidation,
amalgamation or merger (if other than the Company) or the Person to
which such sale, assignment, transfer, conveyance or other disposition
has been made assumes all of the obligations of the Company under the
Notes, this Indenture and the Registration Rights Agreement pursuant to
a supplemental indenture, executed and delivered to the Trustee, in a
form satisfactory to the Trustee;
(3) immediately after such transaction no Default or Event of
Default exists; and
(4) the Company or the Person formed by or surviving any such
consolidation, amalgamation or merger (if other than the Company), or
to which such sale, assignment, transfer, conveyance or other
disposition has been made, will, on the date of such transaction after
giving pro forma effect thereto and any related financing transactions
as if the same had occurred at the beginning of the applicable
four-quarter period, be permitted to incur at least $1.00 of additional
Indebtedness pursuant to Section 4.09(a) hereof.
(b) The Company will not, directly or indirectly, lease all or
substantially all of its properties or assets, in one or more related
transactions, to any other Person. This Section 5.01 will not apply to a sale,
assignment, transfer, conveyance or other disposition of assets between or among
the
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Company and any of its Wholly Owned Restricted Subsidiaries, provided that the
surviving entity of any transaction involving the Company shall be a corporation
or partnership organized and existing under the laws of Canada or any province
or territory thereof, the United States, any state of the United States or the
District of Columbia.
Section 5.02 Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, assignment,
transfer, lease, conveyance or other disposition of all or substantially all of
the assets of the Company in accordance with Section 5.01 hereof, the successor
corporation formed by such consolidation or into or with which the Company is
merged or to which such sale, assignment, transfer, lease, conveyance or other
disposition is made shall succeed to, and be substituted for (so that from and
after the date of such consolidation, merger, sale, lease, conveyance or other
disposition, the provisions of this Indenture referring to the Company shall
refer instead to the successor corporation and not to the Company), and may
exercise every right and power of the Company under this Indenture with the same
effect as if such successor Person had been named as the Company herein;
provided that the predecessor Company shall not be relieved from the obligation
to pay the principal of and interest and Special Interest, if any, on the Notes
except in the case of a sale, assignment, transfer, conveyance or other
disposition of all of the Company's assets that meets the requirements of
Section 5.01 hereof.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01 Events of Default.
(a) An "Event of Default" wherever used herein, means any one
of the following events (whatever the reason for such Event of Default and
whether it shall be voluntary or involuntary or be effected by operation of law
or pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(1) Default in payment of any principal of, or premium, if
any, on the Notes when due (whether at maturity, upon redemption or
otherwise);
(2) Default in the payment of any interest on, or Special
Interest with respect to, any Note when due, which Default continues
for 30 days or more;
(3) failure by the Company or any of its Restricted
Subsidiaries to comply with Sections 3.09, 4.10, 4.15 or 5.01 hereof;
(4) Default by the Company or any Restricted Subsidiary in the
observance or performance of any other covenant in the Notes or this
Indenture for 30 days after written notice from the Trustee or the
Holders of not less than 25% in aggregate principal amount of the Notes
then outstanding;
(5) Default under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced
any Indebtedness for money borrowed by the Company or any of its
Restricted Subsidiaries (or the payment of which is guaranteed by the
Company or any of its Restricted Subsidiaries), whether such
Indebtedness or guarantee now exists, or is created after the Issue
Date, if that default:
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(i) is caused by a failure to pay principal of, or
interest or premium, if any, on such Indebtedness prior to the
expiration of the grace period provided in such Indebtedness
on the date of such default (a "Payment Default"); or
(ii) results in the acceleration of such Indebtedness
prior to its expressed maturity,
and, in each case, the principal amount of any such Indebtedness,
together with the principal amount of any other such Indebtedness under
which there has been a Payment Default or the maturity of which has
been so accelerated, aggregates US$10.0 million or more;
(6) failure by the Company or any of its Restricted
Subsidiaries to pay final judgments aggregating in excess of US$10.0
million, net of applicable insurance coverage, provided that the
Company or such Restricted Subsidiary has submitted a claim for such
judgment and the provider of such insurance has not disputed such
coverage, which judgments are not paid, discharged or stayed for a
period of 60 days;
(7) except as permitted by this Indenture, any Subsidiary
Guarantee shall be held in any judicial proceeding to be unenforceable
or invalid or shall cease for any reason to be in full force and effect
or any Guarantor, or any Person acting on behalf of any Guarantor,
shall deny or disaffirm its obligations under its Subsidiary Guarantee;
(8) if the Company or any of its Restricted Subsidiaries that
is a Significant Subsidiary or any group of Restricted Subsidiaries
that, taken together, would constitute a Significant Subsidiary,
pursuant to or within the meaning of Bankruptcy Law:
(i) commences proceedings to be adjudicated bankrupt or
insolvent;
(ii) consents to the institution of bankruptcy or
insolvency proceedings against it, or the filing by it of a
petition or answer or consent seeking reorganization or relief
under applicable Bankruptcy law;
(iii) consents to the appointment of a receiver,
liquidator, assignee, trustee, sequestrator or other similar
official of it or for all or substantially all of its
property;
(iv) makes a general assignment for the benefit of its
creditors; or
(v) generally is not paying its debts as they become due;
and
(9) if a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(i) is for relief against the Company or any of its
Restricted Subsidiaries that is a Significant Subsidiary or
any group of Restricted Subsidiaries that, taken together,
would constitute a Significant Subsidiary, in a proceeding in
which the Company or any such Restricted Subsidiaries, that is
a Significant Subsidiary or any group of Restricted
Subsidiaries that, taken together, would constitute a
Significant Subsidiary, is to be adjudicated bankrupt or
insolvent;
(ii) appoints a receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or any
of its Restricted Subsidiaries that is a Significant
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Subsidiary or any group of Restricted Subsidiaries that, taken
together, would constitute a Significant Subsidiary, or for
all or substantially all of the property of the Company or any
of its Restricted Subsidiaries that is a Significant
Subsidiary or any group of Restricted Subsidiaries that, taken
together, would constitute a Significant Subsidiary; or
(iii) orders the liquidation of the Company or any of its
Restricted Subsidiaries that is a Significant Subsidiary or
any group of Restricted Subsidiaries that, taken together,
would constitute a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60
consecutive days.
(b) The Company shall deliver to the Trustee, as soon as
practicable and in any event within 10 days after the Company's knowledge
thereof, written notice in the form of an Officers' Certificate of any Default
under this Indenture, its status and what action the Company proposes to take
with respect thereto.
Section 6.02 Acceleration.
(a) If any Event of Default (other than an Event of Default
specified in clause (8) or (9) of Section 6.01(a) hereof with respect to the
Company or any of its Restricted Subsidiaries) occurs and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the then
outstanding Notes may declare all the Notes to be due and payable immediately.
Upon any such declaration, the Notes shall become due and payable immediately.
Notwithstanding the foregoing, if an Event of Default specified in clause (8) or
(9) of Section 6.01(a) hereof occurs with respect to the Company or any of its
Restricted Subsidiaries that is a Significant Subsidiary or any group of
Restricted Subsidiaries that, taken together, would constitute a Significant
Subsidiary, all outstanding Notes shall be due and payable immediately without
further action or notice. The Holders of a majority in aggregate principal
amount of the then outstanding Notes by written notice to the Trustee may on
behalf of all of the Holders rescind an acceleration and its consequences if the
rescission would not conflict with any judgment or decree and if all existing
Events of Default (except nonpayment of principal, interest, Special Interest,
if any, or premium that has become due solely because of the acceleration) have
been cured or waived.
(b) If an Event of Default occurs by reason of any willful
action (or inaction) taken (or not taken) by or on behalf of the Company with
the intention of avoiding payment of the premium that the Company would have had
to pay if the Company then had elected to redeem the Notes pursuant to Section
3.07 hereof, then, upon acceleration of the Notes, an equivalent premium shall
also become and be immediately due and payable, to the extent permitted by law.
(c) Notwithstanding the preceding paragraph, in the event of a
declaration of acceleration in respect of the Notes because of an Event of
Default specified in Section 6.01(a)(5) shall have occurred and be continuing,
such declaration of acceleration shall be automatically annulled if the
Indebtedness that is the subject of such Event of Default has been discharged or
the Holders thereof have rescinded their declaration of acceleration in respect
of such Indebtedness, and written notice of such discharge or rescission, as the
case may be, shall have been given to the Trustee by the Company and
countersigned by the Holders of such Indebtedness or a trustee, fiduciary or
agent for such Holders, within 30 days after such declaration of acceleration in
respect of the Notes, and no other Event of Default has occurred during such
30-day period which has not been cured or waived during such period.
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Section 6.03 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy to collect the payment of principal, premium, if
any, and interest on the Notes or to enforce the performance of any provision of
the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not
possess any of the Notes or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Holder of a Note in exercising any right
or remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. All remedies
are cumulative to the extent permitted by law.
Section 6.04 Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal
amount of the then outstanding Notes by notice to the Trustee may on behalf of
the Holders of all of the Notes waive an existing Default or Event of Default
and its consequences hereunder, except a continuing Default or Event of Default
in the payment of the principal of, premium and Special Interest, if any, or
interest on, the Notes (including in connection with a Repurchase Offer);
provided, subject to Section 6.02 hereof, that the Holders of a majority in
aggregate principal amount of the then outstanding Notes may rescind an
acceleration and its consequences, including any related payment default that
resulted from such acceleration. Upon any such waiver, such Default shall cease
to exist, and any Event of Default arising therefrom shall be deemed to have
been cured for every purpose of this Indenture; but no such waiver shall extend
to any subsequent or other Default or impair any right consequent thereon.
Section 6.05 Control by Majority.
Holders of a majority in principal amount of the then
outstanding Notes may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising any
trust or power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture that the Trustee determines
may be unduly prejudicial to the rights of other Holders of Notes or that may
involve the Trustee in personal liability.
Section 6.06 Limitation on Suits.
Subject to Section 6.07, a Holder of a Note may pursue a
remedy with respect to this Indenture or the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice
of a continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the
then outstanding Notes make a written request to the Trustee to pursue
the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee
against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60
days after receipt of the request and the offer and, if requested, the
provision of indemnity; and
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(e) during such 60-day period the Holders of a majority in
principal amount of the then outstanding Notes do not give the Trustee
a direction inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the
rights of another Holder of a Note or to obtain a preference or priority over
another Holder of a Note.
Section 6.07 Rights of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Indenture, the
right of any Holder of a Note to receive payment of principal, premium, if any,
and Special Interest, if any, and interest on the Note, on or after the
respective due dates expressed in the Note (including in connection with a
Repurchase Offer), or to bring suit for the enforcement of any such payment on
or after such respective dates, shall not be impaired or affected without the
consent of such Holder.
Section 6.08 Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(a)(1) or (2)
occurs and is continuing, the Trustee is authorized to recover judgment in its
own name and as trustee of an express trust against the Company for the whole
amount of principal of, premium, if any, and Special Interest, if any, and
interest remaining unpaid on the Notes and interest on overdue principal and, to
the extent lawful, interest and such further amount as shall be sufficient to
cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
Section 6.09 Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceedings, the Company, the Trustee and the Holders
shall be restored severally and respectively to their former positions hereunder
and thereafter all rights and remedies of the Trustee and the Holders shall
continue as though no such proceeding has been instituted.
Section 6.10 Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Notes in Section 2.07, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 6.11 Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any
Note to exercise any right or remedy accruing upon any Event of Default shall
impair any such right or remedy or constitute a waiver of any such Event of
Default or an acquiescence therein. Every right and remedy given by this Article
or by law to the Trustee or to the Holders may be exercised from time to time,
and as often as may be deemed expedient, by the Trustee or by the Holders, as
the case may be.
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Section 6.12 Trustee May File Proofs of Claim.
The Trustee is authorized to file such proofs of claim and
other papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel) and
the Holders of the Notes allowed in any judicial proceedings relative to the
Company (or any other obligor upon the Notes including the Guarantors), its
creditors or its property and shall be entitled and empowered to collect,
receive and distribute any money or other property payable or deliverable on any
such claims and any custodian in any such judicial proceeding is hereby
authorized by each Holder to make such payments to the Trustee, and in the event
that the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof. To
the extent that the payment of any such compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel, and any other amounts due
the Trustee under Section 7.07 hereof out of the estate in any such proceeding,
shall be denied for any reason, payment of the same shall be secured by a Lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other properties that the Holders may be entitled to receive in
such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.
Section 6.13 Priorities.
If the Trustee collects any money pursuant to this Article, it
shall pay out the money in the following order:
(i) to the Trustee, its agents and attorneys for amounts due
under Section 7.07 hereof, including payment of all compensation,
expense and liabilities incurred, and all advances made, by the Trustee
and the costs and expenses of collection;
(ii) to Holders of Notes for amounts due and unpaid on the
Notes for principal, premium, if any, and Special Interest, if any, and
interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes for principal,
premium, if any, and Special Interest, if any, and interest,
respectively; and
(iii) to the Company or to such party as a court of competent
jurisdiction shall direct including a Guarantor, if applicable.
The Trustee may fix a record date and payment date for any
payment to Holders of Notes pursuant to this Section 6.13.
Section 6.14 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or
omitted by it as a Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
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litigant. This Section does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.07 hereof, or a suit by Holders of more
than 10% in principal amount of the then outstanding Notes.
ARTICLE 7
TRUSTEE
Section 7.01 Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in its exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by
the express provisions of this Indenture and the Trustee need perform
only those duties that are specifically set forth in this Indenture and
no others, and no implied covenants or obligations shall be read into
this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture. However, in the case of any such certificates or
opinions which by any provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall examine the certificates
and opinions to determine whether or not they conform to the
requirements of this Indenture.
(c) The Trustee may not be relieved from liabilities for its
own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b)
of this Section 7.01;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved in a
court of competent jurisdiction that the Trustee was negligent in
ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b) and (c) of this Section 7.01.
(e) The Trustee shall be under no obligation to exercise any
of its rights and powers under this Indenture at the request of any Holders,
unless such Holder shall have offered to the Trustee security and indemnity
satisfactory to it against any loss, liability or expense.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
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Section 7.02 Rights of Trustee.
(a) The Trustee may conclusively rely upon any document
believed by it to be genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter stated in the
document, but the Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the Trustee
shall determine to make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company, personally
or by agent or attorney at the sole cost of the Company and shall incur no
liability or additional liability of any kind by reason of such inquiry or
investigation.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel or both. The Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on such Officers' Certificate or Opinion of Counsel. The Trustee may
consult with counsel of its selection and the written advice of such counsel or
any Opinion of Counsel shall be full and complete authorization and protection
from liability in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and
shall not be responsible for the misconduct or negligence of any agent or
attorney appointed with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith that it believes to be authorized or within the
rights or powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture,
any demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.
(f) None of the provisions of this Agreement shall require the
Trustee to expend or risk its own funds or otherwise to incur any liability,
financial or otherwise, in the performance of any of its duties hereunder, or in
the exercise of any of its rights or powers if it shall have reasonable grounds
for believing that repayment of such funds or indemnity satisfactory to it
against such risk or liability is not assured to it.
(g) The Trustee shall not be deemed to have notice of any
Default or Event of Default unless a Responsible Officer of the Trustee has
actual knowledge thereof or unless written notice of any event which is in fact
such a default is received by the Trustee at the Corporate Trust Office of the
Trustee, and such notice references the Notes and this Indenture
(h) In no event shall the Trustee be responsible or liable for
special, indirect, or consequential loss or damage of any kind whatsoever
(including, but not limited to, loss of profit) irrespective of whether the
Trustee has been advised of the likelihood of such loss or damage and regardless
of the form of action.
(i) The rights, privileges, protections, immunities and
benefits given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder, and each agent, custodian and other Person employed
to act hereunder.
(j) The Trustee may request that the Company deliver an
Officers' Certificate setting forth the names of individuals and/or titles of
officers authorized at such time to take specified actions pursuant to this
Indenture, which Officers' Certificate may be signed by any person authorized to
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sign an Officers' Certificate, including any person specified as so authorized
in any such certificate previously delivered and not superseded.
Section 7.03 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the Commission
for permission to continue as trustee or resign. Any Agent may do the same with
like rights and duties. The Trustee is also subject to Sections 7.10 and 7.11
hereof.
Section 7.04 Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the Notes, it
shall not be accountable for the Company's use of the proceeds from the Notes or
any money paid to the Company or upon the Company's direction under any
provision of this Indenture, it shall not be responsible for the use or
application of any money received by any Paying Agent other than the Trustee,
and it shall not be responsible for any statement or recital herein or any
statement in the Notes or any other document in connection with the sale of the
Notes or pursuant to this Indenture other than its certificate of
authentication.
Section 7.05 Notice of Defaults.
If a Default or Event of Default occurs and is continuing and
if it is known to the Trustee, the Trustee shall mail to Holders of Notes a
notice of the Default or Event of Default within 90 days after it occurs. Except
in the case of a Default or Event of Default in payment of principal of,
premium, if any, or interest or Special Interest, if any, on any Note, the
Trustee may withhold the notice if and so long as a committee of its Responsible
Officers in good faith determines that withholding the notice is in the
interests of the Holders of the Notes and the Trustee shall withhold the notice
of any Default under Section 6.01(a)(4) hereof until 30 days after notice under
such section is given. The Trustee shall not be deemed to know of any default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is such a default
is received by the Trustee at the Corporate Trust Office of the Trustee.
Section 7.06 Reports by Trustee to Holders of the Notes.
Within 60 days after each May 15th, beginning with the May
15th following the date of this Indenture, and for so long as Notes remain
outstanding, the Trustee shall mail to the Holders of the Notes a brief report
dated as of such reporting date that complies with TIA Section 313(a) (but if no
event described in TIA Section 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
shall comply with TIA Section 313(b)(2). The Trustee shall also transmit by mail
all reports as required by TIA Section 313(c).
A copy of each report at the time of its mailing to the
Holders of Notes shall be mailed to the Company and filed with the Commission
and each stock exchange on which the Notes are listed in accordance with TIA
Section 313(d). The Company shall promptly notify the Trustee when the Notes are
listed on any stock exchange.
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Section 7.07 Compensation and Indemnity.
The Company shall pay to the Trustee from time to time such
compensation for its acceptance of this Indenture and services hereunder as the
parties shall agree in writing from time to time. The Trustee's compensation
shall not be limited by any law on compensation of a trustee of an express
trust. The Company shall reimburse the Trustee promptly upon request for all
reasonable disbursements, advances and expenses incurred or made by it in
addition to the compensation for its services. Such expenses shall include the
reasonable compensation, disbursements and expenses of the Trustee's agents and
counsel.
The obligations of the Company under this Section 7.07 shall
survive the satisfaction and discharge of this Indenture or the earlier
resignation or removal of the Trustee.
To secure the Company's payment obligations in this Section,
the Trustee shall have a Lien prior to the Notes on all money or property held
or collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien shall survive the satisfaction and
discharge of this Indenture.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(a)(8) or (9) hereof occurs, the
expenses and the compensation for the services (including the fees and expenses
of its agents and counsel) are intended to constitute expenses of administration
under any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA Section
313(b)(2) to the extent applicable.
Section 7.08 Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section. The Trustee may resign in
writing at any time and be discharged from the trust hereby created by so
notifying the Company. The Holders of a majority in principal amount of the then
outstanding Notes may remove the Trustee by so notifying the Trustee and the
Company in writing. The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any
Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee
or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office, the
Holders of a majority in principal amount of the then outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee (at the
Company's expense), the Company, or the Holders of at
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least 10% in principal amount of the then outstanding Notes may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
If the Trustee, after written request by any Holder who has
been a Holder for at least six months, fails to comply with Section 7.10, such
Holder may petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee; provided all sums owing to the
Trustee hereunder have been paid and subject to the Lien provided for in Section
7.07 hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligations under Section 7.07 hereof shall continue for the
benefit of the retiring Trustee.
Section 7.09 Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
Section 7.10 Eligibility; Disqualification.
There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trustee power, that is subject to supervision or examination by
federal or state authorities and that has a combined capital and surplus of at
least $50,000,000 as set forth in its most recent published annual report of
condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Sections 310(a)(1), (2) and (5). The Trustee is subject to
TIA Section 310(b).
Section 7.11 Preferential Collection of Claims Against Company.
The Trustee is subject to TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated
therein.
Section 7.12 Appointment of Co-Trustee.
It is recognized that in case of litigation under this
Indenture, and in particular in case of the enforcement thereof on default, or
in the case the Trustee deems that by reason of any present or future law of any
jurisdiction it may not exercise any of the powers, rights or remedies herein
granted to the Trustee or hold title to the properties, in trust, as herein
granted or take any action which may be desirable or necessary in connection
therewith, it may be necessary that the Trustee appoint an individual or
institution as a separate or co-trustee. The following provisions of this
Section are adopted to these ends.
In the event that the Trustee appoints an additional
individual or institution as a separate or co-trustee, each and every remedy,
power, right, claim, demand, cause of action, immunity, estate, title, interest
and lien expressed or intended by this Indenture to be exercised by or vested in
or conveyed to the
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Trustee with respect thereto shall be exercisable by and vest in such separate
or co-trustee but only to the extent necessary to enable such separate or
co-trustee to exercise such powers, rights and remedies, and only to the extent
that the Trustee by the laws of any jurisdiction is incapable of exercising such
powers, rights and remedies and every covenant and obligation necessary to the
exercise thereof by such separate or co-trustee shall run to and be enforceable
by either of them.
Should any instrument in writing from the Company be required
by the separate or co-trustee so appointed by the Trustee for more fully and
certainly vesting in and confirming to it such properties, rights, powers,
trusts, duties and obligations, any and all such instruments in writing shall,
on request, be executed, acknowledged and delivered by the Company; provided
that if an Event of Default shall have occurred and be continuing, if the
Company does not execute any such instrument within fifteen (15) days after
request therefor, the Trustee shall be empowered as an attorney-in-fact for the
Company to execute any such instrument in the Company's name and stead. In case
any separate or co-trustee or a successor to either shall die, become incapable
of acting, resign or be removed, all the estates, properties, rights, powers,
trusts, duties and obligations of such separate or co-trustee, so far as
permitted by law, shall vest in and be exercised by the Trustee until the
appointment of a new trustee or successor to such separate or co-trustee.
Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights and powers, conferred or imposed upon the
Trustee shall be conferred or imposed upon and may be exercised or
performed by such separate trustee or co-trustee; and
(ii) no trustee hereunder shall be personally liable by reason
of any act or omission of any other trustee hereunder.
Any notice, request or other writing given to the Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Indenture and
the conditions of this Article.
Any separate trustee or co-trustee may at any time appoint the
Trustee as its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Indenture on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.
The Company may, at its option and at any time, elect to have
either Section 8.02 or 8.03 hereof applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article 8.
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Section 8.02 Legal Defeasance and Discharge.
Upon the Company's exercise under Section 8.01 hereof of the
option applicable to this Section 8.02, the Company and the Guarantors shall,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
be deemed to have been discharged from their obligations with respect to all
outstanding Notes and Subsidiary Guarantees on the date the conditions set forth
below are satisfied ("Legal Defeasance"). For this purpose, Legal Defeasance
means that the Company shall be deemed to have paid and discharged the entire
Indebtedness represented by the outstanding Notes, which shall thereafter be
deemed to be "outstanding" only for the purposes of Section 8.05 hereof and the
other Sections of this Indenture referred to in (a) and (b) below, and to have
satisfied all its other obligations under such Notes and this Indenture
including that of the Guarantors (and the Trustee, on demand of and at the
expense of the Company, shall execute proper instruments acknowledging the
same), except for the following provisions which shall survive until otherwise
terminated or discharged hereunder:
(a) the rights of Holders of outstanding Notes to receive
payments in respect of the principal of, or interest or premium and
Special Interest, if any, on such Notes when such payments are due from
the trust fund described in Section 8.04 hereof;
(b) the Company's obligations with respect to the Notes under
Article 2 and Section 4.02 hereof; the rights, powers, trusts, duties
and immunities of the Trustee hereunder and the Company's and the
Guarantor's obligations in connection therewith; and
(c) this Article 8.
Subject to compliance with this Article 8, the Company may
exercise its option under this Section 8.02 notwithstanding the prior exercise
of its option under Section 8.03 hereof.
Section 8.03 Covenant Defeasance.
Upon the Company's exercise under Section 8.01 hereof of the
option applicable to this Section 8.03, the Company and the Guarantors shall,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
be released from their obligations under the covenants contained in Sections
4.03, 4.04, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.15, 4.16, 4.17, 4.19,
4.21 and 4.22 hereof and clause (4) of Section 5.01(a) hereof with respect to
the outstanding Notes on and after the date the conditions set forth in Section
8.04 hereof are satisfied ("Covenant Defeasance"), and the Notes shall
thereafter be deemed not "outstanding" for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that such
Notes shall not be deemed outstanding for accounting purposes). For this
purpose, Covenant Defeasance means that, with respect to the outstanding Notes,
the Company may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.01 hereof, but,
except as specified above, the remainder of this Indenture and such Notes shall
be unaffected thereby. In addition, upon the Company's exercise under Section
8.01 hereof of the option applicable to this Section 8.03 hereof, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, Sections
6.01(4), 6.01(5), 6.01(6), and 6.01(7) hereof shall not constitute Events of
Default.
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Section 8.04 Conditions to Legal or Covenant Defeasance.
The following shall be the conditions to the application of
either Section 8.02 or 8.03 hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant
Defeasance:
(a) The Company shall irrevocably deposit with the Trustee, in
trust, for the benefit of the Holders of the Notes, cash in U.S.
dollars, non-callable Government Securities, or a combination of cash
in U.S. dollars and non-callable Government Securities, in such amounts
as will be sufficient, in the opinion of a nationally recognized firm
of independent public accountants, to pay the principal of, or interest
and premium and Special Interest, if any, on the outstanding Notes on
the stated maturity or on the applicable redemption date, as the case
may be, and the Company must specify whether the Notes are being
defeased to maturity or to a particular redemption date;
(b) in the case of an election under Section 8.02 hereof, the
Company shall have delivered to the Trustee an Opinion of Counsel
reasonably acceptable to the Trustee confirming that (a) the Company
has received from, or there has been published by, the Internal Revenue
Service a ruling or (b) since the Issue Date, there has been a change
in the applicable U.S. federal income tax law, in either case to the
effect that, and based thereon such Opinion of Counsel shall confirm
that, the Holders of the outstanding Notes will not recognize income,
gain or loss for U.S. federal income tax purposes as a result of such
Legal Defeasance and will be subject to U.S. federal income tax on the
same amounts, in the same manner and at the same times as would have
been the case if such Legal Defeasance had not occurred;
(c) in the case of an election under Section 8.03 hereof, the
Company shall have delivered to the Trustee an Opinion of Counsel
confirming that the Holders of the outstanding Notes will not recognize
income, gain or loss for U.S. federal income tax purposes as a result
of such Covenant Defeasance and will be subject to U.S. federal income
tax on the same amounts, in the same manner and at the same times as
would have been the case if such Covenant Defeasance had not occurred;
(d) in the case of Section 8.02 or Section 8.03, the Company
shall have delivered to the Trustee an Opinion of Counsel in Canada to
the effect that Holders and beneficial owners of the outstanding Notes
will not recognize income, gain or loss for Canadian federal,
provincial or territorial income tax or other tax purposes as a result
of such Legal Defeasance or Covenant Defeasance, as applicable, and
will be subject to Canadian federal, provincial or territorial income
tax and other tax on the same amounts, in the same manner and at the
same times as would have been the case if such Legal Defeasance or
Covenant Defeasance, as applicable, had not occurred (which condition
may not be waived by any Holder or the Trustee);
(e) no Default or Event of Default may have occurred and be
continuing on the date of such deposit (other than a Default or Event
of Default resulting from the borrowing of funds to be applied to such
deposit);
(f) such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute a default under any
material agreement or instrument (other than this Indenture) to which
the Company or any of its Subsidiaries is a party or by which the
Company or any of its Subsidiaries is bound;
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(g) the Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made by the
Company with the intent of preferring the Holders of Notes over the
other creditors of the Company with the intent of defeating, hindering,
delaying or defrauding creditors of the Company or others; and
(h) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent relating to the Legal Defeasance or the Covenant
Defeasance have been complied with.
Section 8.05 Deposited Money and Government Securities to Be Held in
Trust; Other Miscellaneous Provisions.
Subject to Section 8.06 hereof, all money and non-callable
Government Securities (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this Section
8.05, the "Trustee") pursuant to Section 8.04 hereof in respect of the
outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including the Company or a
Guarantor acting as Paying Agent) as the Trustee may determine, to the Holders
of such Notes of all sums due and to become due thereon in respect of principal,
premium and Special Interest, if any, and interest, but such money need not be
segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the cash or non-callable
Government Securities deposited pursuant to Section 8.04 hereof or the principal
and interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon the
request of the Company any money or non-callable Government Securities held by
it as provided in Section 8.04 hereof which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee (which may be the opinion
delivered under Section 8.04(a) hereof), are in excess of the amount thereof
that would then be required to be deposited to effect an equivalent Legal
Defeasance or Covenant Defeasance.
Section 8.06 Repayment to Company.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of, premium
and Special Interest, if any, or interest on any Note and remaining unclaimed
for two years after such principal, and premium and Special Interest, if any, or
interest has become due and payable shall be paid to the Company on its request
or (if then held by the Company) shall be discharged from such trust; and the
Holder of such Note shall thereafter look only to the Company for payment
thereof, and all liability of the Trustee or such Paying Agent with respect to
such trust money, and all liability of the Company as trustee thereof, shall
thereupon cease; provided that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause to
be published once, in the New York Times, The Wall Street Journal (national
edition), the Globe and Mail and the National Post, notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
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Section 8.07 Reinstatement.
If the Trustee or Paying Agent is unable to apply any United
States dollars or non-callable Government Securities in accordance with Section
8.02 or 8.03 hereof, as the case may be, by reason of any order or judgment of
any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then the Company's obligations under this
Indenture and the Notes shall be revived and reinstated as though no deposit had
occurred pursuant to Section 8.02 or 8.03 hereof until such time as the Trustee
or Paying Agent is permitted to apply all such money in accordance with Section
8.02 or 8.03 hereof, as the case may be; provided that, if the Company makes any
payment of principal of, premium and Special Interest, if any, or interest on
any Note following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Notes to receive such payment
from the money held by the Trustee or Paying Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes.
Notwithstanding Section 9.02 hereof, the Company, the
Guarantors and the Trustee may amend or supplement this Indenture, the
Subsidiary Guarantees or the Notes without the consent of any Holder of a Note:
(1) to cure any ambiguity, defect or inconsistency;
(2) to provide for uncertificated Notes in addition to or in
place of certificated Notes;
(3) to provide for the assumption of the Company's obligations
to Holders of Notes by a successor to the Company pursuant to Article 5
hereof;
(4) to make any change that would provide any additional
rights or benefits to the Holders of Notes or that in the good faith
opinion of the Board of Directors of the Company (evidenced by a
resolution of the Board of Directors set forth in an Officers'
Certificate delivered to the Trustee) does not adversely affect the
rights under this Indenture of any such Holder;
(5) to add a Guarantor; or
(6) to comply with requirements of the Commission in order to
effect or maintain the qualification of this Indenture under the TIA.
Upon the request of the Company accompanied by a resolution of
its Board of Directors authorizing the execution of any such amended or
supplemental indenture, and upon receipt by the Trustee of the documents
described in Section 7.02 hereof, the Trustee shall join with the Company and
the Guarantors in the execution of any amended or supplemental indenture
authorized or permitted by the terms of this Indenture and to make any further
appropriate agreements and stipulations that may be therein contained, but the
Trustee shall not be obligated to enter into such amended or supplemental
indenture that affects its own rights, duties or immunities under this Indenture
or otherwise.
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Section 9.02 With Consent of Holders of Notes.
Except as provided below in this Section 9.02, the Company and
the Trustee may amend or supplement this Indenture, the Notes and the Subsidiary
Guarantees with the consent of the Holders of at least a majority in principal
amount of the Notes (including Additional Notes, if any) then outstanding voting
as a single class (including, without limitation, consents obtained in
connection with a tender offer or exchange offer for, or purchase of, the
Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or
Event of Default (other than a Default or Event of Default in the payment of the
principal of, premium and Special Interest, if any, or interest on the Notes,
except a payment default resulting from an acceleration that has been rescinded)
or compliance with any provision of this Indenture, the Subsidiary Guarantees or
the Notes may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Notes (including Additional Notes, if
any) voting as a single class (including consents obtained in connection with a
tender offer or exchange offer for, or purchase of, the Notes).
Upon the request of the Company accompanied by a resolution of
its Board of Directors authorizing the execution of any such amended or
supplemental indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid,
and upon receipt by the Trustee of the documents described in Section 7.02
hereof, the Trustee shall join with the Company in the execution of such amended
or supplemental indenture unless such amended or supplemental indenture directly
affects the Trustee's own rights, duties or immunities under this indenture or
otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such amended or supplemental indenture.
It shall not be necessary for the consent of the Holders of
Notes under this Section 9.02 to approve the particular form of any proposed
amendment or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section
becomes effective, the Company shall mail to the Holders of Notes affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such amended or
supplemental indenture or waiver.
Without the consent of each Holder affected, an amendment or
waiver under this Section 9.02 may not (with respect to any Notes held by a
non-consenting Holder):
(1) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;
(2) reduce the principal of or change the fixed maturity of
any Note or alter the provisions with respect to the redemption of the
Notes (other than Sections 3.09, 4.10 or 4.15);
(3) reduce the rate of or change the time for payment of
interest on any Note, including Additional Amounts;
(4) waive a Default or Event of Default in the payment of
principal of, or interest or premium, or Special Interest, if any, on
the Notes (except a rescission of acceleration of the Notes by the
Holders of at least a majority in aggregate principal amount of the
Notes and a waiver of the payment default that resulted from such
acceleration);
(5) make any Note payable in money other than that stated in
the Notes;
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(6) make any change in the provisions of this Indenture
relating to waivers of past Defaults or the rights of Holders of Notes
to receive payments of principal of or interest or premium or Special
Interest, if any, on the Notes;
(7) waive a redemption payment with respect to any Note (other
than a payment required by Section 4.10 or Section 4.15 hereof);
(8) release any Guarantor from any of its obligations under
its Subsidiary Guarantee or this Indenture, except in accordance with
the terms of this Indenture; or
(9) make any change in Section 6.04 or 6.07 hereof or to this
Article 9.
Section 9.03 Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes
shall be set forth in a amended or supplemental Indenture that complies with the
TIA as then in effect.
Section 9.04 Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder of a Note is a continuing consent by the Holder of a
Note and every subsequent Holder of a Note or portion of a Note that evidences
the same debt as the consenting Holder's Note, even if notation of the consent
is not made on any Note. However, any such Holder of a Note or subsequent Holder
of a Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to consent to any
amendment, supplement, or waiver. If a record date is fixed, then,
notwithstanding the preceding paragraph, those Persons who were Holders at such
record date (or their duly designated proxies), and only such Persons, shall be
entitled to consent to such amendment, supplement, or waiver or to revoke any
consent previously given, whether or not such Persons continue to be Holders
after such record date. No such consent shall be valid or effective for more
than 120 days after such record date unless the consent of the requisite number
of Holders has been obtained.
Section 9.05 Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an
amendment, supplement or waiver on any Note thereafter authenticated. The
Company in exchange for all Notes may issue and the Trustee shall, upon receipt
of an Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note
shall not affect the validity and effect of such amendment, supplement or
waiver.
Section 9.06 Trustee to Sign Amendments, etc.
The Trustee shall sign any amendment, supplement or waiver
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
The Company may not sign an amendment, supplement or waiver until the Board of
Directors approves it. In executing any amendment, supplement or waiver, the
Trustee shall be entitled to
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receive and (subject to Section 7.01 hereof) shall be fully protected in relying
upon, in addition to the documents required by Section 12.04 hereof, an
Officers' Certificate and an Opinion of Counsel stating that the execution of
such amended or supplemental indenture is authorized or permitted by this
Indenture.
ARTICLE 10
GUARANTEES
Section 10.01 Subsidiary Guarantee.
Subject to this Article 10, each of the Guarantors hereby,
jointly and severally, unconditionally guarantees to each Holder of a Note
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns, irrespective of the validity and enforceability of this Indenture,
the Notes or the obligations of the Company hereunder or thereunder, that: (a)
the principal, interest, premium and Special Interest, if any, on the Notes will
be promptly paid in full when due, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal of and interest
on the Notes, if any, if lawful, and all other obligations of the Company to the
Holders or the Trustee hereunder or thereunder will be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and (b) in case
of any extension of time of payment or renewal of any Notes or any of such other
obligations, that same will be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. Failing payment when due of any amount
so guaranteed or any performance so guaranteed for whatever reason, the
Guarantors shall be jointly and severally obligated to pay the same immediately.
Each Guarantor agrees that this is a guarantee of payment and not a guarantee of
collection.
The Guarantors hereby agree that their obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Notes or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Notes with respect
to any provisions hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance which might
otherwise constitute a legal or equitable discharge or defense of a guarantor.
Each Guarantor hereby waives diligence, presentment, demand of payment, filing
of claims with a court in the event of insolvency or bankruptcy of the Company,
any right to require a proceeding first against the Company, protest, notice and
all demands whatsoever and covenant that this Subsidiary Guarantee shall not be
discharged except by complete performance of the obligations contained in the
Notes and this Indenture.
The obligations of the Guarantor under its Subsidiary
Guarantee are independent of the obligations guaranteed by such Guarantor
hereunder, and a separate action or actions may be brought and prosecuted by the
Trustee on behalf of, or by, the Holders, subject to the terms and conditions
set forth in this Indenture against a Guarantor to enforce the Subsidiary
Guarantee, irrespective of whether any action is brought against the Company or
whether the Company is joined in any such action or actions.
The Guarantor hereby agrees that, in the event of a default in
payment of principal (or premium and Special Interest, if any) or interest on a
Note, whether at its stated maturity, by acceleration, purchase or otherwise,
legal proceedings may be instituted by the Trustee on behalf of, or by, the
Holder of such Note, subject to the terms and conditions set forth in this
Indenture, directly against each of the Guarantors to enforce such Guarantor's
Subsidiary Guarantee without first proceeding against the Company or any other
Guarantor.
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The Guarantor agrees that if, after the occurrence and during
the continuance of an Event of Default, the Trustee or any of the Holders are
prevented by applicable law from exercising their respective rights to
accelerate the maturity of the Notes, to collect interest on the Notes, or to
enforce or exercise any other right or remedy with respect to the Notes, such
Guarantor shall pay to the Trustee for the account of the Holder, upon demand
therefor, the amount that would otherwise have been due and payable had such
rights and remedies been permitted to be exercised by the Trustee or any of the
Holders.
If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors or any custodian, trustee,
liquidator or other similar official acting in relation to either the Company or
the Guarantors, any amount paid either to the Trustee or such Holder, this
Subsidiary Guarantee, to the extent theretofore discharged, shall be reinstated
in full force and effect.
Each Guarantor agrees that it shall not be entitled to any
right of subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed hereby.
Each Guarantor further agrees that, as between the Guarantors, on the one hand,
and the Holders and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 hereof
for the purposes of this Subsidiary Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (y) in the event of any declaration of
acceleration of such obligations as provided in Article 6 hereof, such
obligations (whether or not due and payable) shall forthwith become due and
payable by the Guarantors for the purpose of this Subsidiary Guarantee. The
Guarantors shall have the right to seek contribution from any non-paying
Guarantor so long as the exercise of such right does not impair the rights of
the Holders under the Guarantee.
Each Subsidiary Guarantee shall remain in full force and
effect and continue to be effective should any petition be filed by or against
the Company for liquidation, reorganization, should the Company become insolvent
or make an assignment for the benefit of creditors or should a receiver or
trustee be appointed for all or any significant part of the Company's assets,
and shall, to the fullest extent permitted by law, continue to be effective or
be reinstated, as the case may be, if at any time payment and performance of the
Notes are, pursuant to applicable law, rescinded or reduced in amount, or must
otherwise be restored or returned by any obligee on the Notes or Subsidiary
Guarantees, whether as a "voidable preference," "fraudulent transfer" or
otherwise, all as though such payment or performance had not been made. In the
event that any payment or any part thereof, is rescinded, reduced, restored or
returned, the Note shall, to the fullest extent permitted by law, be reinstated
and deemed reduced only by such amount paid and not so rescinded, reduced,
restored or returned. The form of Subsidiary Guarantee is attached hereto as
Exhibit E.
In case any provision of any Subsidiary Guarantee shall be
invalid, illegal or unenforceable, the validity, legality, and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
The Subsidiary Guarantee issued by any Guarantor shall be a
general unsecured obligation of such Guarantor, ranking pari passu with any
other future senior Indebtedness of such Guarantor, if any.
Each payment to be made by a Guarantor in respect of its
Subsidiary Guarantee shall be made without set-off, counterclaim, reduction or
diminution of any kind or nature.
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Section 10.02 Limitation on Guarantor Liability.
Each Guarantor, and by its acceptance of Notes, each Holder,
hereby confirms that it is the intention of all such parties that the guarantee
by each Guarantor pursuant to its Subsidiary Guarantee not constitute a
fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform
Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar
United States federal or state law or Canadian federal, provincial or
territorial law relating to fraudulent transfer or conveyance. To effectuate the
foregoing intention, the Trustee, the Holders and the Guarantors hereby
irrevocably agree that the obligations of each Guarantor shall be limited to the
maximum amount as will, after giving effect to all other contingent and fixed
liabilities of such Guarantor and after giving effect to any collections from or
payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under its Guarantee or pursuant to its
contribution obligations under the Indenture, result in the obligations of such
Guarantor under the Guarantee not constituting a fraudulent conveyance or
fraudulent transfer under applicable law. Each Guarantor that makes a payment or
distribution under a Guarantee shall be entitled to a contribution from each
other Guarantor in a proportional amount based on the net assets of each
Guarantor, determined in accordance with GAAP.
Section 10.03 Execution and Delivery of Subsidiary Guarantee.
To evidence its Subsidiary Guarantee set forth in Section
10.01, each Guarantor hereby agrees that a notation of such Subsidiary Guarantee
substantially in the form included in Exhibit E shall be endorsed by an Officer
of such Guarantor on each Note authenticated and delivered by the Trustee and
that this Indenture shall be executed on behalf of such Guarantor by its
President or one of its Vice Presidents.
Each Guarantor hereby agrees that its Subsidiary Guarantee set
forth in Section 10.01 shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Subsidiary Guarantee.
If an Officer whose signature is on this Indenture or on the
Subsidiary Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which a Subsidiary Guarantee is endorsed, the
Subsidiary Guarantee shall be valid nevertheless.
The delivery of any Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the
Subsidiary Guarantee set forth in this Indenture on behalf of the Guarantors.
In the event that the Company creates or acquires any new
Restricted Subsidiaries, other than Non-Guarantor Restricted Subsidiaries,
subsequent to the date of this Indenture, if required by Section 4.16 hereof,
the Company shall cause such Restricted Subsidiaries to execute supplemental
indentures to this Indenture and Subsidiary Guarantees in accordance with
Section 4.16 hereof and this Article 10, to the extent applicable.
Section 10.04 Guarantors May Consolidate, etc., on Certain Terms.
Except as otherwise provided in Section 10.05 hereof, no
Guarantor may sell or otherwise dispose of all or substantially all of its
assets to, or consolidate, amalgamate with or merge with or into (whether or not
such Guarantor is the surviving Person) another Person, other than the Company
or another Guarantor unless:
(a) immediately after giving effect to that transaction, no
Default or Event of Default exists; and
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(b) either:
(1) the Guarantor is the surviving Person, or the Person
acquiring the property in any such sale or disposition or the
Person formed by or surviving any such consolidation,
amalgamation or merger assumes all the obligations of that
Guarantor under this Indenture, its Subsidiary Guarantee and
the Registration Rights Agreement pursuant to a supplemental
indenture satisfactory to the Trustee and completes all other
required documentation; or
(2) the Net Proceeds of such sale or other disposition are
applied in accordance with the provisions of Section 4.10
hereof;
In case of any such consolidation, amalgamation, merger, sale
or conveyance and upon the assumption by the successor Person (where
applicable), by supplemental indenture, executed and delivered to the Trustee
and satisfactory in form to the Trustee, of the Guarantee endorsed upon the
Notes and the due and punctual performance of all of the covenants and
conditions of this Indenture to be performed by the Guarantor, such successor
Person shall succeed to and be substituted for the Guarantor with the same
effect as if it had been named herein as a Guarantor. Such successor Person
thereupon may cause to be signed any or all of the Subsidiary Guarantees to be
endorsed upon all of the Notes issuable hereunder which theretofore shall not
have been signed by the Company and delivered to the Trustee. All the Subsidiary
Guarantees so issued shall in all respects have the same legal rank and benefit
under this Indenture as the Subsidiary Guarantees theretofore and thereafter
issued in accordance with the terms of this Indenture as though all of such
Subsidiary Guarantees had been issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 hereof, and
notwithstanding clauses (a) and (b) above, nothing contained in this Indenture
or in any of the Notes shall prevent any consolidation or merger of a Guarantor
with or into the Company or another Guarantor, or shall prevent any sale or
conveyance of the property of a Guarantor as an entirety or substantially as an
entirety to the Company or another Guarantor.
Section 10.05 Releases Following Sale of Assets.
A Guarantor shall be released from all of its obligations
under its Guarantee if all of its Capital Stock is sold (including by way of
merger, amalgamation or consolidation in compliance with Section 5.01 hereof) to
a Person that is not (either before or after giving effect to such transaction)
the Company or a Restricted Subsidiary of the Company, provided that the sale
complies with Section 4.10 hereof. Further, if the Company redesignates any
Restricted Subsidiary that is a Guarantor as an Unrestricted Subsidiary in
accordance with Section 4.17 hereof then such Guarantor will be released and
relieved of any obligations under its Subsidiary Guarantee. Upon delivery by the
Company to the Trustee of an Officers' Certificate and an Opinion of Counsel to
the effect that such sale or other disposition was made by the Company in
accordance with the provisions of this Indenture, including without limitation
Section 4.10 hereof, the Trustee shall execute any documents reasonably required
in order to evidence the release of any Guarantor from its obligations under its
Subsidiary Guarantee.
Any Guarantor not released from its obligations under its
Subsidiary Guarantee shall remain liable for the full amount of principal of and
interest on the Notes and for the other obligations of any Guarantor under this
Indenture as provided in this Article 10.
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Section 10.06 Subrogation.
Each Guarantor shall be subrogated to all rights of Holders of
Notes against the Company in respect of any amounts paid by any Guarantor
pursuant to the provisions of Section 10.01; provided that, if an Event of
Default has occurred and is continuing, no Guarantor shall be entitled to
enforce or receive any payments arising out of, or based upon, such right of
subrogation until all amounts then due and payable by the Company under this
Indenture or the Notes shall have been paid in full.
Section 10.07 Benefits Acknowledged.
Each Guarantor acknowledges that it will receive direct and
indirect benefits from the financing arrangements contemplated by this Indenture
and that the guarantee and waivers made by it pursuant to its Subsidiary
Guarantee are knowingly made in contemplation of such benefits.
ARTICLE 11
SATISFACTION AND DISCHARGE
Section 11.01 Satisfaction and Discharge.
This Indenture will be discharged and will cease to be of
further effect as to all Notes issued thereunder, when:
(a) either:
(1) all Notes that have been authenticated, except lost,
stolen or destroyed Notes that have been replaced or paid and
Notes for whose payment money has been deposited in trust and
thereafter repaid to the Company, have been delivered to the
Trustee for cancellation; or
(2) all Notes that have not been delivered to the Trustee
for cancellation have become due and payable by reason of the
mailing of a notice of redemption or otherwise or will become
due and payable within one year and the Company or any
Guarantor has irrevocably deposited or caused to be deposited
with the Trustee as trust funds in trust solely for the
benefit of the Holders, cash in U.S. dollars, non-callable
Government Securities, or a combination of cash in U.S.
dollars and non-callable Government Securities, in amounts as
will be sufficient without consideration of any reinvestment
of interest, to pay and discharge the entire indebtedness on
the Notes not delivered to the Trustee for cancellation for
principal, premium and Special Interest, if any, and accrued
interest to the date of maturity or redemption;
(b) no Default or Event of Default shall have occurred and be
continuing on the date of the deposit or shall occur as a result of the
deposit and the deposit will not result in a breach or violation of, or
constitute a default under, any other instrument to which the Company
or any Guarantor is a party or by which the Company or any Guarantor is
bound;
(c) the Company or any Guarantor has paid or caused to be paid
all sums payable by it under this Indenture; and
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(d) the Company has delivered irrevocable instructions to the
Trustee under this Indenture to apply the deposited money toward the
payment of the Notes at maturity or the redemption date, as the case
may be.
In addition, the Company must deliver an Officers' Certificate and an Opinion of
Counsel to the Trustee stating that all conditions precedent to satisfaction and
discharge have been satisfied.
Notwithstanding the satisfaction and discharge of this
Indenture, if money shall have been deposited with the Trustee pursuant to
subclause (2) of clause (a) of this Section 11.01, the provisions of Section
11.02 and Section 8.06 hereof shall survive.
Section 11.02 Application of Trust Money.
Subject to the provisions of Section 8.06 hereof, all money
deposited with the Trustee pursuant to Section 11.01 hereof shall be held in
trust and applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium and
Special Interest, if any) and interest for whose payment such money has been
deposited with the Trustee; but such money need not be segregated from other
funds except to the extent required by law.
If the Trustee or Paying Agent is unable to apply any money or
Government Securities in accordance with Section 11.01 hereof by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's and any Guarantor's obligations under this Indenture
and the Notes shall be revived and reinstated as though no deposit had occurred
pursuant to Section 11.01 hereof; provided that if the Company has made any
payment of principal of, premium and Special Interest, if any, or interest on
any Notes because of the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Notes to receive such payment
from the money or Government Securities held by the Trustee or Paying Agent.
ARTICLE 12
MISCELLANEOUS
Section 12.01 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or
conflicts with the duties imposed by TIA Section 318(c), the imposed duties
shall control.
Section 12.02 Notices.
Any notice or communication by the Company, any Guarantor or
the Trustee to the others is duly given if in writing and delivered in Person or
mailed by first class mail (registered or certified, return receipt requested),
telecopier or overnight air courier guaranteeing next day delivery, to the
others' address:
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If to the Company and/or any Guarantor:
Ainsworth Lumber Co. Ltd.
Xxxxx 0000, Xxxxxxx XX,
X.X. Xxx 00000,
0000 Xxxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxx Xxxxxxxx,
Xxxxxx, X0X 0X0
Telecopier No.: (000) 000-0000
Attention: Chief Financial Officer
With copies to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx
Xxxxxx, X0X 0X0
Telephone Number (000) 000-0000
Attention: Xxxxxxxxxxx X. Xxxxxx
- and -
Xxxxxx Xxxxxx Xxxxxxx LLP
1200 Waterfront Centre,
000 Xxxxxxx Xxxxxx,
X.X. Xxx 00000,
Xxxxxxxxx, Xxxxxxx Xxxxxxxx,
Xxxxxx, X0X 0X0
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx Xxxxxx
If to the Trustee:
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00X
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Administration
The Company, any Guarantor or the Trustee, by notice to the
others may designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to
Holders) shall be deemed to have been duly given: at the time delivered by hand,
if personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telecopied; and the next
Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery; provided that any notice or
communication delivered to the Trustee shall be deemed effective upon actual
receipt thereof.
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Any notice or communication to a Holder shall be mailed by
first class mail, certified or registered, return receipt requested, or by
overnight air courier guaranteeing next day delivery to its address shown on the
register kept by the Registrar. Any notice or communication shall also be so
mailed to any Person described in TIA Section 313(c), to the extent required by
the TIA. Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided
above within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it
shall mail a copy to the Trustee and each Agent at the same time.
Section 12.03 Communication by Holders of Notes with Other Holders of Notes.
Holders may communicate pursuant to TIA Section 312(b) with
other Holders with respect to their rights under this Indenture or the Notes.
The Company, the Trustee, the Registrar and anyone else shall have the
protection of TIA Section 312(c).
Section 12.04 Certificate and Opinion as to Conditions Precedent.
(a) Upon any request or application by the Company or any of
the Restricted Subsidiaries to the Trustee to take any action under this
Indenture, the Company or such Guarantor, as the case may be, shall furnish to
the Trustee an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 12.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and
(b) An Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 12.05 below) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied.
Section 12.05 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to Section 4.04 hereof or TIA Section 314(a)(4)) shall comply
with the provisions of TIA Section 314(e) and shall include:
(a) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she
has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with (and, in the case of an Opinion of
Counsel, may be limited to reliance on an Officers' Certificate as to
matters of fact); and
(d) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been complied with.
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Section 12.06 Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a
meeting of Holders. The Registrar, Paying Agent or Calculation Agent may make
reasonable rules and set reasonable requirements for its functions.
Section 12.07 No Personal Liability of Directors, Officers, Employees and
Shareholders.
No past, present or future director, officer, employee,
incorporator or shareholder of the Company or any Guarantor, as such, shall have
any liability for any obligations of the Company or the Guarantors under the
Notes, this Indenture, the Subsidiary Guarantees, or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder of
Notes by accepting a Note waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the Notes.
Section 12.08 Governing Law.
THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE, THE NOTES AND THE SUBSIDIARY GUARANTEES.
Section 12.09 Waiver of Jury Trial.
EACH OF THE COMPANY, THE GUARANTORS AND THE TRUSTEE HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND
ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS INDENTURE, THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 12.10 Force Majeure.
In no event shall the Trustee be responsible or liable for any
failure or delay in the performance of its obligations under this Indenture
arising out of or caused by, directly or indirectly, forces beyond its
reasonable control, including without limitation strikes, work stoppages,
accidents, acts of war or terrorism, civil or military disturbances, nuclear or
natural catastrophes or acts of god, and interruptions, loss or malfunctions of
utilities, communications or computer (software or hardware) services.
Section 12.11 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other
indenture, loan or debt agreement of the Company or their Restricted
Subsidiaries or of any other Person. Any such indenture, loan or debt agreement
may not be used to interpret this Indenture.
Section 12.12 Successors.
All agreements of the Company in this Indenture and the Notes
shall bind their successors. All agreements of the Trustee in this Indenture
shall bind its successors. All agreements of each Guarantor in this Indenture
shall bind its successors, except as otherwise provided in Section 10.05.
-86-
Section 12.13 Agent for Service; Submission to Jurisdiction; Waiver of
Immunities.
By the execution and delivery of this Indenture, the Company
and each of the Non-U.S. Guarantors (i) acknowledges that it has, by separate
written instrument, irrevocably designated and appointed CT Corporation System,
000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 as its authorized agent
upon which process may be served in any suit, action or proceeding arising out
of or relating to the Notes, the Subsidiary Guarantees or this Indenture that
may be instituted in any U.S. federal or state court located in the Borough of
Manhattan in The City of New York, or brought under federal or state securities
laws, and acknowledges that CT Corporation System has accepted such designation,
(ii) submits to the non-exclusive jurisdiction of such courts in any such suit,
action or proceeding, and (iii) agrees that service of process upon CT
Corporation System and written notice of said service to it (mailed or delivered
to its Chief Financial Officer at its principal office in Vancouver, British
Columbia as specified in Section 12.02 hereof), shall be deemed in every respect
effective service of process upon it in any such suit or proceeding. The Company
further agrees to take any and all action, including the execution and filing of
any and all such documents and instruments, as may be necessary to continue such
designation and appointment in full force and effect so long as this Indenture
shall be in full force and effect.
To the extent that any of the Company or the Guarantors has or
hereafter may acquire any immunity from jurisdiction of any court or from any
legal process (whether through service of notice, attachment prior to judgment,
attachment in aid of execution, execution or otherwise) with respect to itself
or its property, each of the Company and the Guarantors hereby irrevocably
waives such immunity in respect of its obligations under this Indenture and the
Notes, to the extent permitted by law.
Section 12.14 Conversion of Currency
(a) (i) If for the purpose of obtaining judgment in, or
enforcing the judgment of, any court in any country, it becomes necessary to
convert into any other currency (the "judgment currency") an amount due in U.S.
dollars, then the conversion shall be made at the rate of exchange prevailing on
the Business Day before the day on which the judgment is given or the order of
enforcement is made, as the case may be (unless a court shall otherwise
determine). (ii) If there is a change in the rate of exchange prevailing between
the Business Day before the day on which the judgment is given or an order of
enforcement is made, as the case may be (or such other date as a court shall
determine), and the date of receipt of the amount due, the Company will pay such
additional (or, as the case may be, such lesser) amount, if any, as may be
necessary so that the amount paid in the judgment currency when converted at the
rate of exchange prevailing on the date of receipt will produce the amount in
U.S. dollars originally due.
(b) In the event of the winding-up of the Company at any time
while any amount or damages owing under the Notes, Subsidiary Guarantees or this
Indenture, or any judgment or order rendered in respect thereof, shall remain
outstanding, the Company shall indemnify and hold the Holders and the Trustee
harmless against any deficiency arising or resulting from any variation in rates
of exchange between (1) the date as of which the equivalent of the amount in
U.S. dollars due or contingently due under the Notes, Subsidiary Guarantees or
this Indenture (other than under this Clause (b)) is calculated for the purposes
of such winding-up and (2) the final date for the filing of proofs of claim in
such winding-up. For the purpose of this Clause (b), the final date for the
filing of proofs of claim in the winding-up of the Company shall be the date
fixed by the liquidator or otherwise in accordance with the relevant provisions
of applicable law as being the latest practicable date as at which liabilities
of the Company may be ascertained for such winding-up prior to payment by the
liquidator or otherwise in respect thereto.
-87-
(c) The obligations contained in Clauses (a)(ii) and (b) of
this Section 12.14 shall constitute separate and independent obligations of the
Company from its other obligations under the Notes, Subsidiary Guarantees and
this Indenture, shall give rise to separate and independent causes of action
against the Company, shall apply irrespective of any waiver or extension granted
by any Holder or Trustee or either of them from time to time and shall continue
in full force and effect notwithstanding any judgment or order or the filing of
any proof of claim in the winding-up of the Company for a liquidated sum in
respect of amounts due hereunder (other than under Clause (b) above) or under
any such judgment or order. Any such deficiency as aforesaid shall be deemed to
constitute a loss suffered by the Holders or the Trustee, as the case may be,
and no proof or evidence of any actual loss shall be required by the Company,
the Guarantors or the liquidator or otherwise. In the case of Clause (b) above,
the amount of such deficiency shall not be deemed to be reduced by any variation
in rates of exchange occurring between the said final date and the date of any
liquidating distribution.
(d) The term "rate(s) of exchange" shall mean the rate of
exchange quoted by the Federal Reserve Bank of New York, noon buying rate on the
date of determination for purchases of U.S. dollars with the judgment currency
other than U.S. dollars referred to in Clauses (a) and (b) above and includes
any premiums and costs of exchange payable.
(e) The Trustee shall have no duty or liability with respect
to monitoring or enforcing this Section 12.14.
Section 12.15 Currency Equivalent.
Except as provided in Section 12.14, for purposes of the
construction of the terms of this Indenture or of the Notes and Subsidiary
Guarantees, in the event that any amount is stated herein in the currency of one
nation (the "First Currency"), as of any date such amount shall also be deemed
to represent the amount in the currency of any other relevant nation (the "Other
Currency") which is required to purchase such amount in the First Currency at
the rate of exchange quoted by the Federal Reserve Bank of New York, noon buying
rate on the date of determination.
Section 12.16 Severability.
In case any provision in this Indenture or in the Notes shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
Section 12.17 Counterpart Originals.
The parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them together represent the
same agreement.
Section 12.18 Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and headings of
the Articles and Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part of this Indenture and shall
in no way modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
-88-
SIGNATURES
XXXXXXXXX LUMBER CO. LTD.
By: /s/ Xxxxxxxxx Xxxxxxxxx
-----------------------------------
Name: Xxxxxxxxx Xxxxxxxxx
Title: Chief Operating Officer
By: /s/ Xxxxxxx Xxxxxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Executive Vice-President
XXXXXXXXX ENGINEERED CORP.
By: /s/ Xxxxxxxxx Xxxxxxxxx
-----------------------------------
Name: Xxxxxxxxx Xxxxxxxxx
Title: Secretary
By: /s/ Xxxxxxx Xxxxxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Executive Vice-President
THE BANK OF NEW YORK, as Trustee
By: /s/ Xxxxxxxx Xxxxxxxx-Coward
-----------------------------------
Name: Xxxxxxxx Xxxxxxxx-Coward
Title: Assistant Vice-President
EXHIBIT A-1
[Face of Fixed Rate Note]
[Insert the Global Note Legend, if applicable pursuant to the provisions
of the Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the
provisions of the Indenture]
A-1-1
Rule 144A Fixed Rate Note CUSIP: 000000XX0
Rule 144A Fixed Rate Note ISIN: US009037AE28
Regulation S Fixed Rate Note CUSIP: X00000XX0
Regulation S Fixed Rate Note ISIN: USC01023AE71
7 1/4% Senior Notes due 2012
No. ___ US$
XXXXXXXXX LUMBER CO. LTD.
promises to pay to _____________________________ or registered assigns, the
principal sum of ________________________________________________ United States
Dollars on October 1, 2012.
Interest Payment Dates: June 30 and December 30
Record Dates: June 15 and December 15
A-1-2
IN WITNESS HEREOF, the Company has caused this instrument to
be duly executed.
Dated:
XXXXXXXXX LUMBER CO. LTD.
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
A-1-3
This is one of the Fixed Rate Notes referred to in the within-mentioned
Indenture:
THE BANK OF NEW YORK,
as Trustee
By:
----------------------------------
Authorized Signatory
A-1-4
[Back of Fixed Rate Note]
7 1/4% Senior Notes due 2012
Capitalized terms used herein shall have the meanings assigned
to them in the Indenture referred to below unless otherwise indicated.
1. INTEREST. Xxxxxxxxx Lumber Co. Ltd., a corporation
amalgamated under the laws of the Province of British Columbia (the "Company"),
promises to pay interest on the principal amount of this Fixed Rate Note at
7 1/4% per annum from September 22, 2004(1) until maturity and shall pay the
Special Interest, if any, payable pursuant to the Registration Rights Agreement
referred to below. The Company will pay interest and Special Interest, if any,
semi-annually in arrears on June 30th and December 30th of each year, or if any
such day is not a Business Day, on the next succeeding Business Day (each an
"Interest Payment Date"). Interest on the Fixed Rate Notes will accrue from the
most recent date to which interest has been paid or, if no interest has been
paid, from the date of issuance; provided that the first Interest Payment Date
shall be December 30, 2004. The Company will pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal and premium, if any, from time to time on demand at the interest rate
on the Fixed Rate Notes plus 1% to the extent lawful; it shall pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue installments of interest and Special Interest (without regard to any
applicable grace periods) from time to time on demand at the interest rate on
the Fixed Rate Notes plus 1% to the extent lawful. Interest will be computed on
the basis of a 360-day year comprised of twelve 30-day months. For the purposes
of disclosure under the Interest Act (Canada), the yearly rate of interest which
is equivalent to the rate payable hereunder is the rate payable hereunder
multiplied by the actual number of days in the year divided by 360.
2. METHOD OF PAYMENT. The Company will pay interest on the
Fixed Rate Notes and Special Interest, if any, to the Persons who are registered
Holders of Fixed Rate Notes at the close of business on the June 15 or December
15 (whether or not a Business Day), as the case may be, next preceding the
Interest Payment Date, even if such Fixed Rate Notes are canceled after such
record date and on or before such Interest Payment Date, except as provided in
Section 2.12 of the Indenture with respect to defaulted interest. Payment of
interest and Special Interest, if any, may be made by check mailed to the
Holders at their addresses set forth in the register of Holders, provided that
payment by wire transfer of immediately available funds will be required with
respect to principal of and interest, premium and Special Interest, if any, on,
all Global Notes and all other Notes the Holders of which shall have provided
wire transfer instructions to the Company or the Paying Agent. Such payment
shall be in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. Initially, The Bank of New
York, the Trustee under the Indenture, will act as Paying Agent and Registrar.
The Company may change any Paying Agent or Registrar without notice to the
Holders. The Company or any Guarantor may act in any such capacity.
----------
(1) With respect to the Initial Fixed Rate Notes.
A-1-5
4. INDENTURE. The Company issued the Fixed Rate Notes under an
Indenture, dated as of September 22, 2004 (the "Indenture"), among the Company,
the Guarantor named therein and the Trustee. This Fixed Rate Note is one of a
duly authorized issue of notes of the Company designated as its 7 1/4% Senior
Notes due 2012. The Company shall be entitled to issue Additional Fixed Rate
Notes pursuant to Section 2.01, 2.02 and 4.09 of the Indenture. The Fixed Rate
Notes (including any Exchange Notes issued in exchange therefor) and the
Floating Rate Notes issued under the Indenture (including any Exchange Notes
issued in Exchange therefor) (collectively, referred to herein as the "Notes")
are separate series of Notes, but shall be treated as a single class of
securities under the Indenture, unless otherwise specified in the Indenture. The
terms of the Fixed Rate Notes include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of 1939, as
amended (the "TIA"). The Fixed Rate Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms. To the extent any provision of this Fixed Rate Note conflicts with the
express provisions of the Indenture, the provisions of the Indenture shall
govern and be controlling.
5. OPTIONAL REDEMPTION.
(a) Except as described below under clauses 5(b) and 5(c)
hereof, the Fixed Rate Notes will not be redeemable at the Company's option
before October 1, 2008. Thereafter, the Company may redeem all or a part of the
Fixed Rate Notes upon not less than 30 nor more than 60 days' prior notice, at
the redemption prices (expressed as percentages of principal amount) set forth
below plus accrued and unpaid interest and Special Interest, if any, on the
Fixed Rate Notes redeemed, to, but not including, the applicable redemption
date, if redeemed during the twelve-month period beginning on October 1 of the
years indicated below:
OPTIONAL
REDEMPTION
YEAR PRICE
---- ----------
2008............................................... 103.625%
2009............................................... 101.813%
2010 and thereafter................................ 100.000%
(b) At any time prior to October 1, 2007, the Company may on
any one or more occasions redeem up to 35% of the aggregate principal amount of
Fixed Rate Notes (including any Additional Fixed Rate Notes outstanding), at a
redemption price equal to 107.25% of the principal amount, plus accrued and
unpaid interest and Special Interest, if any, to, but not including, the
redemption date, with the net cash proceeds of one or more Equity Offerings;
provided that:
(1) at least 65% of the aggregate principal amount of Fixed
Rate Notes (including any Additional Fixed Rate Notes outstanding)
theretofore issued under the Indenture remains outstanding immediately
after the occurrence of such redemption (excluding Fixed Rate Notes
held by the Company and its Subsidiaries); and
(2) the redemption occurs within 60 days of the date of the
closing of such Equity Offering.
(c) The Company may redeem all, but not less than all, of the
Fixed Rate Notes at any time at 100% of the aggregate principal amount of the
Fixed Rate Notes, together with accrued and unpaid interest and Special
Interest, if any, on the Fixed Rate Notes redeemed to the applicable redemption
date, if the Company has become or would become obligated to pay, on the next
date on which any
A-1-6
amount would be payable with respect to the Fixed Rate Notes, any Additional
Amounts as a result of a change in the laws (including any regulations
promulgated thereunder) of Canada (or any political subdivision or taxing
authority thereof or therein), or any change in any official position of any
governmental agency, taxing authority or regulatory authority regarding the
application or interpretation of such laws or regulations, which change is
announced or becomes effective on or after September 17, 2004.
(d) Any redemption pursuant to this paragraph 5 shall be made
pursuant to the provisions of Sections 3.01 through 3.06 of the Indenture.
6. MANDATORY REDEMPTION. The Company shall not be required to
make mandatory redemption or sinking fund payments with respect to the Fixed
Rate Notes.
7. NOTICE OF REDEMPTION. Subject to Section 3.09 of the
Indenture, notice of redemption will be mailed by first class mail at least 30
days but not more than 60 days before the redemption date (except that
redemption notices may be mailed more than 60 days prior to a redemption date if
the notice is issued in connection with Article 8 or Article 11 of the
Indenture) to each Holder whose Fixed Rate Notes are to be redeemed at its
registered address. Fixed Rate Notes in denominations larger than US$1,000 may
be redeemed in part but only in whole multiples of US$1,000, unless all of the
Notes held by a Holder are to be redeemed. On and after the redemption date
interest ceases to accrue on Fixed Rate Notes or portions thereof called for
redemption.
8. OFFERS TO REPURCHASE.
(a) Upon the occurrence of a Change of Control, the Company
shall make an offer (a "Change of Control Offer") to each Holder to repurchase
all or any part (equal to US$1,000 or an integral multiple thereof) of each
Holder's Fixed Rate Notes at a purchase price equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest and Special Interest
thereon, if any, to the date of purchase (the "Change of Control Payment"). The
Change of Control Offer shall be made in accordance with Sections 3.09 and 4.15
of the Indenture.
(b) If the Company or any of its Restricted Subsidiaries
consummates an Asset Sale, the Company may use Excess Proceeds to make at any
time, and when the aggregate amount of Excess Proceeds exceeds US$10.0 million
the Company shall commence, an offer to purchase (an "Asset Sale Offer") to all
Holders of Fixed Rate Notes and all Holders of other Indebtedness that is pari
passu with the Fixed Rate Notes containing provisions similar to those set forth
in the Indenture with respect to offers to purchase or redeem such indebtedness
with the proceeds of sales of assets, to purchase the maximum principal amount
of Fixed Rate Notes (including any Additional Fixed Rate Notes) and such other
pari passu Indebtedness that may be purchased out of the Excess Proceeds at an
offer price in cash in an amount equal to 100% of the principal amount thereof
plus accrued and unpaid interest and Special Interest thereon, if any, to the
date fixed for the closing of such offer, in accordance with the procedures set
forth in the Indenture. To the extent that the aggregate amount of Fixed Rate
Notes (including any Additional Fixed Rate Notes) and other pari passu
Indebtedness tendered pursuant to an Asset Sale Offer is less than the Excess
Proceeds, the Company (or such Restricted Subsidiary) may use those Excess
Proceeds for any purpose not otherwise prohibited by the Indenture. If the
aggregate principal amount of Fixed Rate Notes and other pari passu Indebtedness
tendered pursuant to an Asset Sale Offer exceeds the amount of Excess Proceeds,
the Trustee shall select the Fixed Rate Notes and such other pari passu
Indebtedness to be purchased on a pro rata basis based on the principal amount
of Fixed Rate Notes and other pari passu Indebtedness tendered. Holders of Fixed
Rate Notes that are the subject of an offer to purchase will receive an Asset
Sale Offer from the Company prior to any related purchase date and may
A-1-7
elect to have such Fixed Rate Notes purchased by completing the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Fixed Rate Notes.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Fixed Rate Notes are
in registered form without coupons in denominations of US$1,000 and integral
multiples of US$1,000. The transfer of Fixed Rate Notes may be registered and
Fixed Rate Notes may be exchanged as provided in the Indenture. The Registrar
and the Trustee may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and the Company may require a Holder to pay
any taxes and fees required by law or permitted by the Indenture. The Company
need not exchange or register the transfer of any Fixed Rate Note or portion of
a Fixed Rate Note selected for redemption, except for the unredeemed portion of
any Fixed Rate Note being redeemed in part. Also, the Company need not exchange
or register the transfer of any Fixed Rate Notes for a period of 15 days before
a selection of Fixed Rate Notes to be redeemed.
10. PERSONS DEEMED OWNERS. The registered Holder of a Fixed
Rate Note may be treated as its owner for all purposes, except as set forth in
Section 4.18 of the Indenture.
11. AMENDMENT, SUPPLEMENT AND WAIVER. The Indenture, the
Subsidiary Guarantees or the Notes may be amended or supplemented as provided in
the Indenture.
12. DEFAULTS AND REMEDIES. The Events of Default relating to
the Fixed Rate Notes are defined in Section 6.01 of the Indenture. If any Event
of Default occurs and is continuing, the Trustee or the Holders of at least 25%
in principal amount of the then outstanding Notes may declare all the Notes to
be due and payable immediately. Notwithstanding the foregoing, in the case of an
Event of Default arising from certain events of bankruptcy or insolvency, all
outstanding Notes will become due and payable immediately without further action
or notice. Holders may not enforce the Indenture, the Fixed Rate Notes or the
Subsidiary Guarantees except as provided in the Indenture. Subject to certain
limitations, Holders of a majority in principal amount of the then outstanding
Notes may direct the Trustee in its exercise of any trust or power. The Trustee
may withhold from Holders of the Fixed Rate Notes notice of any continuing
Default or Event of Default (except a Default or Event of Default relating to
the payment of principal, premium or Special Interest, if any, or interest) if
it determines that withholding notice is in their interest. The Holders of a
majority in aggregate principal amount of the Notes then outstanding by notice
to the Trustee may on behalf of the Holders of all of the Notes waive any
existing Default or Event of Default and its consequences under the Indenture
except a continuing Default or Event of Default in the payment of interest or
Special Interest on, or the principal of, premium and Special Interest, if any,
or interest on, the Notes. The Company is required to deliver to the Trustee
annually a statement regarding compliance with the Indenture, and the Company is
required upon becoming aware of any Default or Event of Default, to deliver to
the Trustee a statement specifying such Default or Event of Default.
13. AUTHENTICATION. This Fixed Rate Note shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any purpose
until authenticated by the manual signature of the Trustee.
14. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES
AND RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders
of Fixed Rate Notes under the Indenture, Holders of Restricted Global Notes and
Restricted Definitive Notes shall have all the rights set forth in the
Registration Rights Agreement, dated as of September 22, 2004, among the
Company, the guarantor named therein and the other parties named on the
signature pages thereof (the
A-1-8
"Registration Rights Agreement"), including the right to receive Special
Interest (as defined in the Registration Rights Agreement).
15. GOVERNING LAW. THE LAWS OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THE INDENTURE, THE FIXED RATE NOTES AND THE
SUBSIDIARY GUARANTEES.
16. CUSIP NUMBERS. Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Fixed Rate Notes and the Trustee may
use CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed on
the Fixed Rate Notes or as contained in any notice of redemption and reliance
may be placed only on the other identification numbers placed thereon.
The Company will furnish to any Holder upon written request
and without charge a copy of the Indenture and/or the Registration Rights
Agreement. Requests may be made to:
Xxxxxxxxx Lumber Co. Ltd.
Xxxxx 0000, Xxxxxxx XX,
X.X. Xxx 00000,
0000 Xxxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx X0X 0X0
Attention: Chief Financial Officer
A-1-9
ASSIGNMENT FORM
To assign this Fixed Rate Note, fill in the form below:
(I) or (we) assign and transfer this Fixed Rate Note to:
_________________________________________________________________________
(Insert assignee' legal name)
_________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint__________________________________________________
to transfer this Fixed Rate Note on the books of the Company. The agent may
substitute another to act for him.
Date: _____________________
Your Signature: ______________________
(Sign exactly as your
name appears on the face
of this Fixed Rate Note)
Signature Guarantee*: __________________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-1-10
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Fixed Rate Note purchased by
the Company pursuant to Section 4.10 or 4.15 of the Indenture, check the
appropriate box below:
[ ] Section 4.10 [ ] Section 4.15
If you want to elect to have only part of this Fixed Rate Note
purchased by the Company pursuant to Section 4.10 or Section 4.15 of the
Indenture, state the amount you elect to have purchased:
US$_______________
Date: _____________________
Your Signature: ______________________
(Sign exactly as your
name appears on the face
of this Fixed Rate Note)
Tax Identification No.: ________________
Signature Guarantee*: __________________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-1-11
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Definitive Note, or exchanges of a part
of another Global or Definitive Note for an interest in this Global Note, have
been made:
AMOUNT OF INCREASE PRINCIPAL AMOUNT OF SIGNATURE OF
IN PRINCIPAL THIS GLOBAL NOTE AUTHORIZED OFFICER
AMOUNT OF DECREASE AMOUNT OF THIS FOLLOWING SUCH OF TRUSTEE OR
DATE OF EXCHANGE IN PRINCIPAL AMOUNT GLOBAL NOTE DECREASE OR INCREASE NOTE CUSTODIAN
---------------- ------------------- ------------------ -------------------- ------------------
------------------
* This schedule should be included only if the Note is issued in global form.
X-0-00
XXXXXXX X-0
[Face of Floating Rate Note]
[Insert the Global Note Legend, if applicable pursuant to the provisions
of the Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the
provisions of the Indenture]
A-2-1
Rule 144A Floating Rate Note CUSIP: 000000XX0
Rule 144A Floating Rate Note ISIN: US009037AF92
Regulation S Floating Rate Note CUSIP: X00000XX0
Regulation S Floating Rate Note ISIN: USC01023AF47
Senior Floating Rate Notes due 2010
No. ___ US$
XXXXXXXXX LUMBER CO. LTD.
promises to pay to _____________________________ or registered assigns, the
principal sum of ________________________________________________ United States
Dollars on October 1, 2010.
Interest Payment Dates: March 30, June 30, September 30 and December 30
Record Dates: March 15, June 15, September 15 and December 15
A-2-2
IN WITNESS HEREOF, the Company has caused this instrument to
be duly executed.
Dated:
XXXXXXXXX LUMBER CO. LTD.
By:
-----------------------------------
Name:
Title:
By:
-----------------------------------
Name:
Title:
A-2-3
This is one of the Floating Rate Notes referred to in the within-mentioned
Indenture:
THE BANK OF NEW YORK,
as Trustee
By:
----------------------------------
Authorized Signatory
A-2-4
[Back of Floating Rate Note]
Senior Floating Rate Notes due 2010
Capitalized terms used herein shall have the meanings assigned
to them in the Indenture referred to below unless otherwise indicated.
1. INTEREST. Xxxxxxxxx Lumber Co. Ltd., a corporation
amalgamated under the laws of the Province of British Columbia (the "Company"),
promises to pay interest on the principal amount of this Floating Rate Note at a
rate per annum, reset quarterly, equal to LIBOR plus 3.75% as determined by the
Calculation Agent from September 22, 2004(2) until maturity and shall pay the
Special Interest, if any, payable pursuant to the Registration Rights Agreement
referred to below. The Company will pay interest and Special Interest, if any,
quarterly in arrears on March 30, June 30, September 30 and December 30 (each,
an "Interest Payment Date"), commencing on December 30, 2004, of each year, or
if any such day is not a Business Day, on the next succeeding Business Day. The
Company will make each interest payment to the holders of record of the Floating
Rate Notes on the immediately preceding March 15, June 15, September 15 and
December 15 (each, a "Record Date"). Interest on the Floating Rate Notes will
accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from and including the Issue Date. The Company will pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time on
demand at the rate borne by the Floating Rate Notes plus 1% to the extent
lawful; it shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest and
Special Interest (without regard to any applicable grace periods) from time to
time on demand at the rate borne by the Floating Rate Notes plus 1% to the
extent lawful.
"LIBOR", with respect to an Interest Period, will be the rate
(expressed as a percentage per annum) for deposits in United States dollars for
a three-month period beginning on the second London Banking Day after the
Determination Date that appears on Telerate Page 3750 as of 11:00 a.m., London
time, on the Determination Date. If Telerate Page 3750 does not include such a
rate or is unavailable on a Determination Date, the Calculation Agent will
request the principal London office of each of four major banks in the London
interbank market, as selected by the Calculation Agent, to provide such bank's
offered quotation (expressed as a percentage per annum), as of approximately
11:00 a.m., London time, on such Determination Date, to prime banks in the
London interbank market for deposits in a Representative Amount in United States
dollars for a three-month period beginning on the second London Banking Day
after the Determination Date. If at least two such offered quotations are so
provided, LIBOR for the Interest Period will be the arithmetic mean of such
quotations. If fewer than two such quotations are so provided, the Calculation
Agent will request each of three major banks in New York City, as selected by
the Calculation Agent, to provide such bank's rate (expressed as a percentage
per annum), as of approximately 11:00 a.m., New York City time, on such
Determination Date, for loans in a Representative Amount in United States
dollars to leading European banks for a three-month period beginning on the
second London Banking Day after the Determination Date. If at least two such
rates are so provided, LIBOR for the Interest Period will be the arithmetic mean
of such rates. If fewer than two such rates are so provided, then LIBOR for the
Interest Period will be LIBOR in effect with respect to the immediately
preceding Interest Period.
----------
(2) With respect to Initial Floating Rate Notes.
A-2-5
"Interest Period" means the period commencing on and including
an interest payment date and ending on and including the day immediately
preceding the next succeeding interest payment date, with the exception that the
first Interest Period shall commence on and include the Issue Date and end on
and include December 29, 2004.
"Determination Date", with respect to an Interest Period, will
be the second London Banking Day preceding the first day of the Interest Period.
"London Banking Day" is any day in which dealings in United
States dollars are transacted or, with respect to any future date, are expected
to be transacted in the London interbank market.
"Representative Amount" means a principal amount of not less
than US$1,000,000 for a single transaction in the relevant market at the
relevant time.
"Telerate Page 3750" means the display designated as "Page
3750" on the Moneyline Telerate service (or such other page as may replace Page
3750 on that service).
The amount of interest for each day that the Floating Rate
Notes are outstanding (the "Daily Interest Amount") will be calculated by
dividing the interest rate in effect for such day by 360 and multiplying the
result by the principal amount of the Floating Rate Notes. The amount of
interest to be paid on the Floating Rate Notes for each Interest Period will be
calculated by adding the Daily Interest Amounts for each day in the Interest
Period. For the purpose of the Interest Act (Canada), the yearly rate of
interest which is equivalent to the rate payable hereunder is the rate payable
hereunder multiplied by the actual number of days in the year and divided by
360.
All percentages resulting from any of the above calculations
will be rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point, with five one-millionths of a percentage point being rounded
upwards (e.g., 9.876545% (or .09876545) being rounded to 9.87655% (or .0987655))
and all dollar amounts used in or resulting from such calculations will be
rounded to the nearest cent (with one-half cent being rounded upwards).
The interest rate on the Floating Rate Notes will in no event
be higher than the maximum rate permitted by New York law as the same may be
modified by United States law of general application.
The Calculation Agent will, upon the request of the holder of
any Floating Rate Note, provide the interest rate then in effect with respect to
the Floating Rate Notes. All calculations made by the Calculation Agent in the
absence of manifest error will be conclusive for all purposes and binding on the
Company, the Guarantors and the holders of the Floating Rate Notes.
2. METHOD OF PAYMENT. The Company will pay interest on the
Floating Rate Notes and Special Interest, if any, to the Persons who are
registered Holders of Floating Rate Notes at the close of business on the Record
Date next preceding the Interest Payment Date, even if such Floating Rate Notes
are canceled after such record date and on or before such Interest Payment Date,
except as provided in Section 2.12 of the Indenture with respect to defaulted
interest. Payment of interest and Special Interest, if any, may be made by check
mailed to the Holders at their addresses set forth in the register of Holders,
provided that payment by wire transfer of immediately available funds will be
required with respect to principal of and interest, premium and Special
Interest, if any, on, all Global Notes and all other Floating Rate Notes the
Holders of which shall have provided wire transfer instructions to the Company
A-2-6
or the Paying Agent. Such payment shall be in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts.
3. PAYING AGENT, REGISTRAR AND CALCULATION AGENT. Initially,
The Bank of New York, the Trustee under the Indenture, will act as Paying Agent,
Registrar and Calculation Agent. The Company may change any Paying Agent,
Registrar or Calculation Agent without notice to the Holders. The Company or any
Guarantor may act as Paying Agent or Registrar.
4. INDENTURE. The Company issued the Floating Rate Notes under
an Indenture, dated as of September 22, 2004 (the "Indenture"), among the
Company, the Guarantor named therein and the Trustee. This Floating Rate Note is
one of a duly authorized issue of notes of the Company designated as its Senior
Floating Rate Notes due 2010. The Company shall be entitled to issued Additional
Floating Rate Notes pursuant to Section 2.01, 2.02 and 4.09 of the Indenture.
The Floating Rate Notes (including any Exchange Notes issued in exchange
therefor) and the Fixed Rate Notes issued under the Indenture (including any
Exchange Notes issued in exchange therefor) (collectively referred to herein as
the "Notes") are separate series of Notes, but shall be treated as a single
class of securities under the Indenture, unless otherwise specified in the
Indenture. The terms of the Floating Rate Notes include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (the "TIA"). The Floating Rate Notes are
subject to all such terms, and Holders are referred to the Indenture and such
Act for a statement of such terms. To the extent any provision of this Floating
Rate Note conflicts with the express provisions of the Indenture, the provisions
of the Indenture shall govern and be controlling.
5. OPTIONAL REDEMPTION.
(a) Except as described below under clauses 5(b) and (c)
hereof, the Floating Rate Notes will not be redeemable at the Company's option
before October 1, 2006. Thereafter, the Company may redeem all or a part of the
Floating Rate Notes upon not less than 30 nor more than 60 days' prior notice,
at the redemption prices (expressed as percentages of principal amount) set
forth below plus accrued and unpaid interest and Special Interest, if any, on
the Floating Rate Notes redeemed, to, but not including, the applicable
redemption date, if redeemed during the twelve-month period beginning on October
1 of the years indicated below:
OPTIONAL
REDEMPTION
YEAR PRICE
---- ----------
2006............................................... 102.000%
2007............................................... 101.000%
2008 and thereafter................................ 100.000%
(b) At any time prior to October 1, 2006, the Company may on
any one or more occasions redeem up to 35% of the aggregate principal amount of
Floating Rate Notes (including any Additional Floating Rate Notes outstanding),
at a redemption price of 100% of the principal amount thereof, plus a premium
equal to the rate per annum on the Floating Rate Notes applicable on the date on
which notice of redemption is given, together with accrued and unpaid interest
and Special Interest, if any, to, but not including, such redemption date, with
the net cash proceeds of of one or more Equity Offerings; provided that:
A-2-7
(1) at least 65% of the aggregate principal amount of Floating
Rate Notes (including any Additional Floating Rate Notes) remains
outstanding immediately after the occurrence of any such redemption
(excluding Floating Rate Notes held by the Company and its
Subsidiaries); and
(2) the redemption occurs within 60 days of the date of the
closing of such Equity Offering.
(c) The Company may redeem all, but not less than all, of the
Floating Rate Notes at any time at 100% of the aggregate principal amount of the
Floating Rate Notes, together with accrued and unpaid interest and Special
Interest, if any, on the Floating Rate Notes redeemed to the applicable
redemption date, if the Company has become or would become obligated to pay, on
the next date on which any amount would be payable with respect to the Floating
Rate Notes, any Additional Amounts as a result of a change in the laws
(including any regulations promulgated thereunder) of Canada (or any political
subdivision or taxing authority thereof or therein), or any change in any
official position of any governmental agency, taxing authority or regulatory
authority regarding the application or interpretation of such laws or
regulations, which change is announced or becomes effective on or after
September 17, 2004.
(d) Any redemption pursuant to this paragraph 5 shall be made
pursuant to the provisions of Sections 3.01 through 3.06 of the Indenture.
6. MANDATORY REDEMPTION. The Company shall not be required to
make mandatory redemption or sinking fund payments with respect to the Floating
Rate Notes.
7. NOTICE OF REDEMPTION. Subject to Section 3.09 of the
Indenture, notice of redemption will be mailed by first class mail at least 30
days but not more than 60 days before the redemption date (except that
redemption notices may be mailed more than 60 days prior to a redemption date if
the notice is issued in connection with Article 8 or Article 11 of the
Indenture) to each Holder whose Floating Rate Notes are to be redeemed at its
registered address. Floating Rate Notes in denominations larger than US$1,000
may be redeemed in part but only in whole multiples of US$1,000, unless all of
the Notes held by a Holder are to be redeemed. On and after the redemption date
interest ceases to accrue on Floating Rate Notes or portions thereof called for
redemption.
8. OFFERS TO REPURCHASE.
(a) Upon the occurrence of a Change of Control, the Company
shall make an offer (a "Change of Control Offer") to each Holder to repurchase
all or any part (equal to US$1,000 or an integral multiple thereof) of each
Holder's Floating Rate Notes at a purchase price equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest and Special Interest
thereon, if any, to the date of purchase (the "Change of Control Payment"). The
Change of Control Offer shall be made in accordance with Sections 3.09 and 4.15
of the Indenture.
(b) If the Company or any of its Restricted Subsidiaries
consummates an Asset Sale, the Company may use Excess Proceeds to make at any
time, and when the aggregate amount of Excess Proceeds exceeds US$10.0 million
the Company shall commence, an offer to purchase (an "Asset Sale Offer") to all
Holders of Floating Rate Notes and all Holders of other Indebtedness that is
pari passu with the Floating Rate Notes containing provisions similar to those
set forth in the Indenture with respect to offers to purchase or redeem such
indebtedness with the proceeds of sales of assets, to purchase the maximum
principal amount of Floating Rate Notes (including any Additional Floating Rate
Notes) and such other pari passu Indebtedness that may be purchased out of the
Excess Proceeds at an offer price in cash in an amount equal to 100% of the
principal amount thereof plus accrued and unpaid interest and
A-2-8
Special Interest thereon, if any, to the date fixed for the closing of such
offer, in accordance with the procedures set forth in the Indenture. To the
extent that the aggregate amount of Floating Rate Notes (including any
Additional Floating Rate Notes) and other pari passu Indebtedness tendered
pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Company
(or such Restricted Subsidiary) may use those Excess Proceeds for any purpose
not otherwise prohibited by the Indenture. If the aggregate principal amount of
Floating Rate Notes and other pari passu Indebtedness tendered pursuant to an
Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee shall select
the Floating Rate Notes and such other pari passu Indebtedness to be purchased
on a pro rata basis based on the principal amount of Floating Rate Notes and
other pari passu Indebtedness tendered. Holders of Floating Rate Notes that are
the subject of an offer to purchase will receive an Asset Sale Offer from the
Company prior to any related purchase date and may elect to have such Floating
Rate Notes purchased by completing the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Floating Rate Notes.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Floating Rate Notes
are in registered form without coupons in denominations of US$1,000 and integral
multiples of US$1,000. The transfer of Notes may be registered and Floating Rate
Notes may be exchanged as provided in the Indenture. The Registrar and the
Trustee may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and the Company may require a Holder to pay
any taxes and fees required by law or permitted by the Indenture. The Company
need not exchange or register the transfer of any Floating Rate Note or portion
of a Floating Rate Note selected for redemption, except for the unredeemed
portion of any Note being redeemed in part. Also, the Company need not exchange
or register the transfer of any Floating Rate Notes for a period of 15 days
before a selection of Floating Rate Notes to be redeemed.
10. PERSONS DEEMED OWNERS. The registered Holder of a Floating
Rate Note may be treated as its owner for all purposes, except as set forth in
Section 4.18 of the Indenture.
11. AMENDMENT, SUPPLEMENT AND WAIVER. The Indenture, the
Subsidiary Guarantees or the Notes may be amended or supplemented as provided in
the Indenture.
12. DEFAULTS AND REMEDIES. The Events of Default relating to
the Floating Rate Notes are defined in Section 6.01 of the Indenture. If any
Event of Default occurs and is continuing, the Trustee or the Holders of at
least 25% in principal amount of the then outstanding Notes may declare all the
Notes to be due and payable immediately. Notwithstanding the foregoing, in the
case of an Event of Default arising from certain events of bankruptcy or
insolvency, all outstanding Notes will become due and payable immediately
without further action or notice. Holders may not enforce the Indenture, the
Floating Rate Notes or the Subsidiary Guarantees except as provided in the
Indenture. Subject to certain limitations, Holders of a majority in principal
amount of the then outstanding Notes may direct the Trustee in its exercise of
any trust or power. The Trustee may withhold from Holders of the Floating Rate
Notes notice of any continuing Default or Event of Default (except a Default or
Event of Default relating to the payment of principal, premium or Special
Interest, if any, or interest) if it determines that withholding notice is in
their interest. The Holders of a majority in aggregate principal amount of the
Notes then outstanding by notice to the Trustee may on behalf of the Holders of
all of the Notes waive any existing Default or Event of Default and its
consequences under the Indenture except a continuing Default or Event of Default
in the payment of interest or Special Interest on, or the principal of, premium
and Special Interest, if any, or interest on, the Notes. The Company is required
to deliver to the Trustee annually a statement regarding compliance with the
Indenture, and the Company is required upon becoming aware of any Default or
Event of Default, to deliver to the Trustee a statement specifying such Default
or Event of Default.
A-2-9
13. AUTHENTICATION. This Floating Rate Note shall not be
entitled to any benefit under the Indenture or be valid or obligatory for any
purpose until authenticated by the manual signature of the Trustee.
14. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES
AND RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders
of Floating Rate Notes under the Indenture, Holders of Restricted Global Notes
and Restricted Definitive Notes shall have all the rights set forth in the
Registration Rights Agreement, dated as of September 22, 2004, among the
Company, the guarantor named therein and the other parties named on the
signature pages thereof (the "Registration Rights Agreement"), including the
right to receive Special Interest (as defined in the Registration Rights
Agreement).
15. GOVERNING LAW. THE LAWS OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THE INDENTURE, THE FLOATING RATE NOTES AND THE
SUBSIDIARY GUARANTEES.
16. CUSIP NUMBERS. Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Floating Rate Notes and the Trustee
may use CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed on
the Floating Rate Notes or as contained in any notice of redemption and reliance
may be placed only on the other identification numbers placed thereon.
The Company will furnish to any Holder upon written request
and without charge a copy of the Indenture and/or the Registration Rights
Agreement. Requests may be made to:
Ainsworth Lumber Co. Ltd.
Xxxxx 0000, Xxxxxxx XX,
X.X. Xxx 00000,
0000 Xxxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx X0X 0X0
Attention: Chief Financial Officer
A-2-10
ASSIGNMENT FORM
To assign this Floating Rate Note, fill in the form below:
(I) or (we) assign and transfer this Floating Rate Note to:
_________________________________________________________________________
(Insert assignee' legal name)
_________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint _________________________________________________
to transfer this Floating Rate Note on the books of the Company. The agent
may substitute another to act for him.
Date: _____________________
Your Signature: ______________________
(Sign exactly as your
name appears on the face
of this Floating Rate Note)
Signature Guarantee*: __________________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-2-11
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Floating Rate Note purchased
by the Company pursuant to Section 4.10 or 4.15 of the Indenture, check the
appropriate box below:
[ ] Section 4.10 [ ] Section 4.15
If you want to elect to have only part of this Floating Rate
Note purchased by the Company pursuant to Section 4.10 or Section 4.15 of the
Indenture, state the amount you elect to have purchased:
US$_______________
Date: _____________________
Your Signature: ______________________
(Sign exactly as your
name appears on the face
of this Floating Rate Note)
Tax Identification No.: _______________
Signature Guarantee*: __________________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-2-12
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Definitive Note, or exchanges of a part
of another Global or Definitive Note for an interest in this Global Note, have
been made:
AMOUNT OF INCREASE PRINCIPAL AMOUNT OF SIGNATURE OF
IN PRINCIPAL THIS GLOBAL NOTE AUTHORIZED OFFICER
AMOUNT OF DECREASE AMOUNT OF THIS FOLLOWING SUCH OF TRUSTEE OR
DATE OF EXCHANGE IN PRINCIPAL AMOUNT GLOBAL NOTE DECREASE OR INCREASE NOTE CUSTODIAN
---------------- ------------------- ------------------ -------------------- ------------------
------------------
*This schedule should be included only if the Note is issued in global form.
A-2-13
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Ainsworth Lumber Co. Ltd.
Xxxxx 0000, Xxxxxxx XX,
X.X. Xxx 00000,
0000 Xxxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx X0X 0X0
Telecopier No.: (000) 000-0000
Attention: Chief Financial Officer
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00X
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Administration
Re: [7 1/4% Senior Notes due 2012] [Senior Floating Rate Notes
due 2010]
Reference is hereby made to the Indenture, dated as of
September 22, 2004 (the "Indenture"), among Xxxxxxxxx Lumber Co. Ltd., a
corporation amalgamated under the laws of the Province of British Columbia and
The Bank of New York, as Trustee. Capitalized terms used but not defined herein
shall have the meanings given to them in the Indenture.
_______________ (the "Transferor") owns and proposes to
transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in
the principal amount of US$___________ in such Note[s] or interests (the
"Transfer"), to _______________ (the "Transferee"), as further specified in
Annex A hereto. In connection with the Transfer, the Transferor hereby certifies
that:
[CHECK ALL THAT APPLY]
1. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE 144A GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO RULE 144A. The
Transfer is being effected pursuant to and in accordance with Rule 144A under
the United States Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believed and believes is purchasing the beneficial interest or
Definitive Note for its own account, or for one or more accounts with respect to
which such Person exercises sole investment discretion, and such Person and each
such account is a "qualified institutional buyer" within the meaning of Rule
144A in a transaction meeting the requirements of Rule 144A and such Transfer is
in compliance with any applicable blue sky securities laws of any state of the
United States.
2. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE REGULATION S GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO
REGULATION S. The Transfer is being effected pursuant to and in accordance with
Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor
hereby further certifies that (i) the Transfer is not being made to a person in
the United States and (x) at the time the buy order was originated, the
Transferee was outside the United States or such Transferor and any Person
acting on its behalf reasonably believed and believes that the Transferee was
outside the United States or (y) the transaction was
B-1
executed in, on or through the facilities of a designated offshore securities
market and neither such Transferor nor any Person acting on its behalf knows
that the transaction was prearranged with a buyer in the United States, (ii) no
directed selling efforts have been made in contravention of the requirements of
Rule 903(b) or Rule 904(b) of Regulation S under the Securities Act (iii) the
transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act and (iv) if the proposed transfer is being
made prior to the expiration of the Restricted Period, the transfer is not being
made to a U.S. Person or for the account or benefit of a U.S. Person (other than
an Initial Purchaser). Upon consummation of the proposed transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will be subject to the restrictions on Transfer enumerated in
the Indenture and the Securities Act.
3. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF
A BENEFICIAL INTEREST IN THE DEFINITIVE NOTE PURSUANT TO ANY PROVISION OF THE
SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The Transfer is being
effected in compliance with the transfer restrictions applicable to beneficial
interests in Restricted Global Notes and Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act and any applicable blue
sky securities laws of any state of the United States, and accordingly the
Transferor hereby further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to and in
accordance with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the Company or a
subsidiary thereof;
or
(c) [ ] such Transfer is being effected pursuant to an
effective registration statement under the Securities Act and in
compliance with the prospectus delivery requirements of the Securities
Act;
or
(d) [ ] such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144 or
Rule 904, and the Transferor hereby further certifies that it has not
engaged in any general solicitation within the meaning of Regulation D
under the Securities Act and the Transfer complies with the transfer
restrictions applicable to beneficial interests in a Restricted Global
Note or Restricted Definitive Notes and the requirements of the
exemption claimed, which certification is supported by (1) a
certificate executed by the Transferee in the form of Exhibit D to the
Indenture and (2) an Opinion of Counsel provided by the Transferor or
the Transferee (a copy of which the Transferor has attached to this
certification), to the effect that such Transfer is in compliance with
the Securities Act. Upon consummation of the proposed transfer in
accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the
Definitive Notes and in the Indenture and the Securities Act.
4. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED DEFINITIVE NOTE.
B-2
(a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The
Transfer is being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any state of the United
States and (ii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will no longer be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes, on Restricted Definitive Notes and in the Indenture.
(b) [ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of any
state of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Notes, on Restricted Definitive Notes and in the
Indenture.
(c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i)
The Transfer is being effected pursuant to and in compliance with an exemption
from the registration requirements of the Securities Act other than Rule 144,
Rule 903 or Rule 904 and in compliance with the transfer restrictions contained
in the Indenture and any applicable blue sky securities laws of any State of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes or Restricted Definitive Notes and in the Indenture.
B-3
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.
[Insert Name of Transferor]
By:
_____________________________
Name:
Title:
Dated: _______________________
ANNEX A TO CERTIFICATE OF TRANSFER
5. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Global Note (CUSIP _________), or
(b) [ ] a Restricted Definitive Note.
6. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Global Note (CUSIP _________), or
(iii) [ ] Unrestricted Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note; or
(c) [ ] an Unrestricted Definitive Note, in accordance with
the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Ainsworth Lumber Co. Ltd.
Xxxxx 0000, Xxxxxxx XX,
X.X. Xxx 00000,
0000 Xxxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx X0X 0X0
Attention: Chief Financial Officer
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00X
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Administration
Re: [7 1/4% Senior Notes due 2012] [Senior Floating Rate
Notes due 2010]
Reference is hereby made to the Indenture, dated as of
September 22, 2004 (the "Indenture"), among Xxxxxxxxx Lumber Co. Ltd., a
corporation amalgamated under the laws of the Province of British Columbia and
The Bank of New York, as Trustee. Capitalized terms used but not defined herein
shall have the meanings given to them in the Indenture.
___________ (the "Owner") owns and proposes to exchange the
Note[s] or interest in such Note[s] specified herein, in the principal amount of
US$__________ in such Note[s] or interests (the "Exchange"). In connection with
the Exchange, the Owner hereby certifies that:
1) EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN A RESTRICTED GLOBAL NOTE FOR UNRESTRICTED DEFINITIVE NOTES OR
BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL NOTE
a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST
IN A RESTRICTED GLOBAL NOTE TO BENEFICIAL INTEREST IN AN
UNRESTRICTED GLOBAL NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note
for a beneficial interest in an Unrestricted Global Note in an
equal principal amount, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner's own
account without transfer, (ii) such Exchange has been effected
in compliance with the transfer restrictions applicable to the
Global Notes and pursuant to and in accordance with the United
States Securities Act of 1933, as amended (the "Securities
Act"), (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act and (iv)
the beneficial interest in an Unrestricted Global Note is
being acquired in compliance with any applicable blue sky
securities laws of any state of the United States.
b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST
IN A RESTRICTED GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE.
In connection with the Exchange of the Owner's beneficial
interest in a Restricted Global Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Definitive
Note is
C-1
being acquired for the Owner's own account without transfer,
(ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to the Restricted Global
Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act and (iv)
the Definitive Note is being acquired in compliance with any
applicable blue sky securities laws of any state of the United
States.
c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED
DEFINITIVE NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED
GLOBAL NOTE. In connection with the Owner's Exchange for a
Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner's own
account without transfer, (ii) such Exchange has been effected
in compliance with the transfer restrictions applicable to
Restricted Definitive Notes and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend
are not required in order to maintain compliance with the
Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities
laws of any state of the United States.
d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED
DEFINITIVE NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection
with the Owner's Exchange of a Restricted Definitive Note for
an Unrestricted Definitive Note, the Owner hereby certifies
(i) the Unrestricted Definitive Note is being acquired for the
Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and
in accordance with the Securities Act, (iii) the restrictions
on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the Unrestricted
Definitive Note is being acquired in compliance with any
applicable blue sky securities laws of any state of the United
States.
2) EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN RESTRICTED GLOBAL NOTES FOR RESTRICTED DEFINITIVE NOTES OR
BENEFICIAL INTERESTS IN RESTRICTED GLOBAL NOTES
a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST
IN A RESTRICTED GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In
connection with the Exchange of the Owner's beneficial
interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner
hereby certifies that the Restricted Definitive Note is being
acquired for the Owner's own account without transfer. Upon
consummation of the proposed Exchange in accordance with the
terms of the Indenture, the Restricted Definitive Note issued
will continue to be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the
Restricted Definitive Note and in the Indenture and the
Securities Act.
b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED
DEFINITIVE NOTE TO BENEFICIAL INTEREST IN A RESTRICTED GLOBAL
NOTE. In connection with the Exchange of the Owner's
Restricted Definitive Note for a beneficial interest in the
144A Global Note, with an equal principal amount, the Owner
hereby certifies (i) the beneficial interest is being acquired
for the Owner's own account without
C-2
transfer and (ii) such Exchange has been effected in
compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with
the Securities Act, and in compliance with any applicable blue
sky securities laws of any state of the United States. Upon
consummation of the proposed Exchange in accordance with the
terms of the Indenture, the beneficial interest issued will be
subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the relevant Restricted
Global Note and in the Indenture and the Securities Act.
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and are dated
______________________.
[Insert Name of Transferor]
By:
--------------------------------
Name:
Title:
Dated: _______________________
C-3
EXHIBIT D
[FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR]
Xxxxxxxxx Lumber Co. Ltd.
Xxxxx 0000, Xxxxxxx XX,
X.X. Xxx 00000,
0000 Xxxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx X0X 0X0
Attention: Chief Financial Officer
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00X
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Administration
Re: [7 1/4% Senior Notes due 2012] [Senior Floating Rate
Notes due 2010]
Reference is hereby made to the Indenture, dated as of
September 22, 2004 (the "Indenture"), among Xxxxxxxxx Lumber Co. Ltd., a
corporation amalgamated under the laws of the Province of British Columbia and
The Bank of New York, as Trustee. Capitalized terms used but not defined herein
shall have the meanings given to them in the Indenture.
In connection with our proposed purchase of US$___________
aggregate principal amount of:
a) a beneficial interest in a Global Note, or
b) a Definitive Note,
we confirm that:
1) We understand that any subsequent transfer of the Notes or
any interest therein is subject to certain restrictions and conditions set forth
in the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2) We understand that the offer and sale of the Notes have not
been registered under the Securities Act, and that the Notes and any interest
therein may not be offered or sold except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which we
are acting as hereinafter stated, that if we should sell the Notes or any
interest therein, we will do so only (A) to the Company or any subsidiary
thereof, (B) in accordance with Rule 144A under the Securities Act to a
"qualified institutional buyer" (as defined therein), (C) to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to you and to the
Company a signed letter substantially in the form of this letter and an Opinion
of Counsel in form reasonably acceptable to the Company to the effect that such
transfer is in compliance with the Securities Act, (D) outside the United States
in accordance with Rule 904 of Regulation S under
D-1
the Securities Act, (E) pursuant to the provisions of Rule 144(k) under the
Securities Act or (F) pursuant to an effective registration statement under the
Securities Act, and we further agree to provide to any person purchasing the
Definitive Note or beneficial interest in a Global Note from us in a transaction
meeting the requirements of clauses (A) through (E) of this paragraph a notice
advising such purchaser that resales thereof are restricted as stated herein.
3) We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Notes purchased by us
will bear a legend to the foregoing effect.
4) We are an institutional "accredited investor" (within the
meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act) and have such knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risks of our investment in the Notes,
and we and any accounts for which we are acting are each able to bear the
economic risk of our or its investment.
5) We are acquiring the Notes or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Company are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby.
[Insert Name of Accredited Investor]
By:
--------------------------------
Name:
Title:
Dated: _______________________
D-2
EXHIBIT E
[FORM OF NOTATION OF GUARANTEE]
For value received, each Guarantor (which term includes any
successor Person under the Indenture) has, jointly and severally,
unconditionally guaranteed, to the extent set forth in the Indenture (as defined
below) and subject to the provisions in the Indenture dated as of September 22,
2004 (the "Indenture") among Xxxxxxxxx Lumber Co. Ltd., a corporation
amalgamated under the laws of the Province of British Columbia, and The Bank of
New York, as Trustee (the "Trustee"), (a) the due and punctual payment of the
principal of, premium and Special Interest, if any, and interest on the [Fixed
Rate Notes] [Floating Rate Notes] (as defined in the Indenture), whether at
maturity, by acceleration, redemption or otherwise, the due and punctual payment
of interest on overdue principal and premium, and, to the extent permitted by
law, interest, and the due and punctual performance of all other obligations of
the Company to the Holders or the Trustee all in accordance with the terms of
the Indenture and (b) in case of any extension of time of payment or renewal of
any [Fixed Rate Notes] [Floating Rate Notes] or any of such other obligations,
that the same will be promptly paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise. The obligations of the Guarantors to the Holders of
[Fixed Rate Notes] [Floating Rate Notes] and to the Trustee pursuant to this
Subsidiary Guarantee and the Indenture are expressly set forth in the Indenture
and reference is hereby made to the Indenture for the precise terms of the
Subsidiary Guarantee.
The laws of the State of New York shall govern and be used to
construe this Subsidiary Guarantee.
[Name of Guarantor(s)]
By:
--------------------------------
Name:
Title:
E-1
EXHIBIT F
[FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS]
Supplemental Indenture (this "Supplemental Indenture"), dated
as of __________, among __________________ (the "Guaranteeing Subsidiary"), a
subsidiary of Xxxxxxxxx Lumber Co. Ltd., a corporation incorporated under the
laws of the Province of British Columbia (the "Company"), the Company, Xxxxxxxxx
Engineered Corp. (the "Prior Guarantor") and The Bank of New York, as Trustee
under the Indenture referred to below (the "Trustee").
W I T N E S S E T H
WHEREAS, each of the Company and the Prior Guarantor has
heretofore executed and delivered to the Trustee an indenture (the "Indenture"),
dated as of September 22, 2004, providing for the issuance of an unlimited
aggregate principal amount of 7 1/4% Senior Notes due 2012 and Senior Floating
Rate Notes due 2010 (together, the "Notes");
WHEREAS, the Indenture provides that under certain
circumstances a Subsidiary providing a Subsidiary Guarantee shall execute and
deliver to the Trustee a supplemental indenture pursuant to which such
Subsidiary shall unconditionally guarantee all of the Company's Obligations
under the Notes and the Indenture on the terms and conditions set forth herein
(the "Subsidiary Guarantee"); and
WHEREAS, pursuant to Section 9.01 of the Indenture, the
Trustee is authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other
good and valuable consideration, the receipt of which is hereby acknowledged,
the parties mutually covenant and agree for the equal and ratable benefit of the
Holders of the Notes as follows:
(1) Capitalized Terms. Capitalized terms used herein without
definition shall have the meanings assigned to them in the Indenture.
(2) Agreement to Guarantee. The Guaranteeing Subsidiary hereby
agrees as follows:
(a) Along with all Guarantors named in the Indenture, to
jointly and severally unconditionally guarantee to each Holder of a
Note authenticated and delivered by the Trustee and to the Trustee and
its successors and assigns, irrespective of the validity and
enforceability of the Indenture, the Notes or the obligations of the
Company hereunder or thereunder, that:
(i) the principal of and interest, premium and
Special Interest, if any, on the Notes will be promptly paid
in full when due, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal
of and interest on the Notes, if any, if lawful, and all other
obligations of the Company to the Holders or the Trustee
hereunder or thereunder will be promptly paid in full or
performed, all in accordance with the terms hereof and
thereof; and
(ii) in case of any extension of time of payment or
renewal of any Notes or any of such other obligations, that
same will be promptly paid in full when due or per-
F-1
formed in accordance with the terms of the extension or
renewal, whether at stated maturity, by acceleration or
otherwise. Failing payment when due of any amount so
guaranteed or any performance so guaranteed for whatever
reason, the Guarantors shall be jointly and severally
obligated to pay the same immediately.
(b) The obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the Notes
or the Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Notes with respect to any
provisions hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance which
might otherwise constitute a legal or equitable discharge or defense of
a guarantor.
(c) The obligations of the Guaranteeing Subsidiary under this
Subsidiary Guarantee are independent of the obligations guaranteed by
the Guaranteeing Subsidiary hereunder, and a separate action or actions
may be brought and prosecuted by the Trustee on behalf of, or by, the
Holders, subject to the terms and conditions set forth in the
Indenture, against the Guaranteeing Subsidiary to enforce this
Subsidiary Guarantee, irrespective of whether any action is brought
against the Company or whether the Company is joined in any such action
or actions.
(d) In the event of a default in payment of principal (or
premium and Special Interest, if any) or interest on a Note, whether at
its stated maturity, by acceleration, purchase or otherwise, legal
proceedings may be instituted by the Trustee on behalf of, or by, the
Holder of such Note, subject to the terms and conditions set forth in
the Indenture, directly against the Guaranteeing Subsidiary to enforce
the Subsidiary Guarantee without first proceeding against the Company
or any other Guarantor. If, after the occurrence and during the
continuance of an Event of Default, the Trustee or any of the Holders
are prevented by applicable law from exercising their respective rights
to accelerate the maturity of the Notes, to collect interest on the
Notes, or to enforce or exercise any other right or remedy with respect
to the Notes, the Guaranteeing Subsidiary shall pay to the Trustee for
the account of the Holder, upon demand therefor, the amount that would
otherwise have been due and payable had such rights and remedies been
permitted to be exercised by the Trustee or any of the Holders.
(e) The following is hereby waived: diligence presentment,
demand of payment, filing of claims with a court in the event of
insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands
whatsoever.
(f) This Subsidiary Guarantee shall not be discharged except
by complete performance of the obligations contained in the Notes, the
Indenture and this Supplemental Indenture, and the Guaranteeing
Subsidiary accepts all obligations of a Guarantor under the Indenture.
(g) If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors (including the
Guaranteeing Subsidiary), or any custodian, trustee, liquidator or
other similar official acting in relation to either the Company or the
Guarantors, any amount paid either to the Trustee or such Holder, this
Subsidiary Guarantee, to the extent theretofore discharged, shall be
reinstated in full force and effect.
(h) The Guaranteeing Subsidiary shall not be entitled to any
right of subrogation in relation to the Holders in respect of any
obligations guaranteed hereby until payment in full of all obligations
guaranteed hereby.
F-2
(i) As between the Guaranteeing Subsidiary, on the one hand,
and the Holders and the Trustee, on the other hand, (x) the maturity of
the obligations guaranteed hereby may be accelerated as provided in
Article 6 of the Indenture for the purposes of this Subsidiary
Guarantee, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the obligations guaranteed
hereby, and (y) in the event of any declaration of acceleration of such
obligations as provided in Article 6 of the Indenture, such obligations
(whether or not due and payable) shall forthwith become due and payable
by the Guaranteeing Subsidiary for the purpose of this Subsidiary
Guarantee.
(j) The Guaranteeing Subsidiary shall have the right to seek
contribution from any non-paying Guarantor so long as the exercise of
such right does not impair the rights of the Holders under this
Subsidiary Guarantee.
(k) Pursuant to Section 10.02 of the Indenture, after giving
effect to all other contingent and fixed liabilities that are relevant
under any applicable Bankruptcy or fraudulent conveyance laws, and
after giving effect to any collections from, rights to receive
contribution from or payments made by or on behalf of any other
Guarantor in respect of the obligations of such other Guarantor under
Article 10 of the Indenture, this new Subsidiary Guarantee shall be
limited to the maximum amount permissible such that the obligations of
such Guaranteeing Subsidiary under this Subsidiary Guarantee will not
constitute a fraudulent transfer or conveyance.
(l) This Subsidiary Guarantee shall remain in full force and
effect and continue to be effective should any petition be filed by or
against the Company for liquidation, reorganization, should the Company
become insolvent or make an assignment for the benefit of creditors or
should a receiver or trustee be appointed for all or any significant
part of the Company's assets, and shall, to the fullest extent
permitted by law, continue to be effective or be reinstated, as the
case may be, if at any time payment and performance of the Notes are,
pursuant to applicable law, rescinded or reduced in amount, or must
otherwise be restored or returned by any obligee on the Notes and
Subsidiary Guarantee, whether as a "voidable preference", "fraudulent
transfer" or otherwise, all as though such payment or performance had
not been made. In the event that any payment or any part thereof, is
rescinded, reduced, restored or returned, the Note shall, to the
fullest extent permitted by law, be reinstated and deemed reduced only
by such amount paid and not so rescinded, reduced, restored or
returned.
(m) In case any provision of this Subsidiary Guarantee shall
be invalid, illegal or unenforceable, the validity, legality, and
enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
(n) This Subsidiary Guarantee shall be a general unsecured
obligation of such Guaranteeing Subsidiary, ranking pari passu with any
other future senior Indebtedness of the Guaranteeing Subsidiary, if
any.
(o) Each payment to be made by the Guaranteeing Subsidiary in
respect of this Subsidiary Guarantee shall be made without set-off,
counterclaim, reduction or diminution of any kind or nature.
(3) Execution and Delivery. The Guaranteeing Subsidiary agrees
that the Subsidiary Guarantee shall remain in full force and effect
notwithstanding any failure to endorse on each Note a notation of this
Subsidiary Guarantee.
F-3
(4) Guaranteeing Subsidiary may Consolidate, etc. on Certain
Terms.
(a) Except as otherwise provided in Section 10.05 of the
Indenture, the Guaranteeing Subsidiary may not sell or otherwise dispose of all
or substantially all of its assets to, or consolidate, amalgamate with or merge
with or into (whether or not such Guaranteeing Subsidiary is the surviving
Person) another Person other than the Company or another Guarantor unless:
(b) immediately after giving effect to that transaction, no
Default or Event of Default exists; and
(c) either:
(1) the Guaranteeing Subsidiary is the surviving Person, or
the Person acquiring the property in any such sale or disposition or
the Person formed by or surviving any such consolidation, amalgamation
or merger assumes all the obligations of the Guaranteeing Subsidiary
under the Indenture, this Subsidiary Guarantee and the Registration
Rights Agreement pursuant to a supplemental indenture satisfactory to
the Trustee and completes all other required documentation; or
(2) the Net Proceeds of such sale or other disposition are
applied in accordance with the provisions of Section 4.10 of the
Indenture;
(d) In case of any such consolidation, amalgamation, merger,
sale or conveyance and upon the assumption by the successor Person (where
applicable), by supplemental indenture, executed and delivered to the Trustee
and satisfactory in form to the Trustee, of this Subsidiary Guarantee endorsed
upon the Notes and the due and punctual performance of all of the covenants and
conditions of the Indenture to be performed by the Guaranteeing Subsidiary, such
successor Person shall succeed to and be substituted for the Guaranteeing with
the same effect as if it had been named herein as a Guaranteeing Subsidiary.
Such successor Person thereupon may cause to be signed the Subsidiary Guarantee
to be endorsed upon all of the Notes issuable hereunder which theretofore shall
not have been signed by the Company and delivered to the Trustee. The Subsidiary
Guarantee so issued shall in all respects have the same legal rank and benefit
under the Indenture as the Subsidiary Guarantees theretofore and thereafter
issued in accordance with the terms of the Indenture as though all of such
Subsidiary Guarantees had been issued at the date of the execution hereof.
(e) Except as set forth in Articles 4 and 5 of the Indenture,
and notwithstanding clauses (a) and (b) above, nothing contained in the
Indenture or in any of the Notes shall prevent any consolidation, amalgamation
or merger of a Guaranteeing Subsidiary with or into the Company or another
Guarantor, or shall prevent any sale or conveyance of the property of the
Guaranteeing Subsidiary as an entirety or substantially as an entirety to the
Company or another Guarantor.
(5) Releases.
(a) In the event of a sale (including by way of merger,
amalgamation or consolidation in compliance with Section 5.01 of the Indenture)
of all the capital stock of the Guaranteeing Subsidiary to a Person that is not
(either before or after giving effect to such transaction) the Company or a
Restricted Subsidiary then the Guaranteeing Subsidiary (in the event of a sale
or other disposition, by way of merger, consolidation or otherwise, of all of
the capital stock of such Guaranteeing Subsidiary) will be released and relieved
of any obligations under this Subsidiary Guarantee; provided that the sale
complies with Section 4.10 of the Indenture. Further, if the Company
redesignates any Restricted Subsidiary that is
F-4
a Guarantor as an Unrestricted Subsidiary in accordance with Section 4.17 of the
Indenture then the Guaranteeing Subsidiary will be released and relieve of any
obligations under this Subsidiary Guarantee. Upon delivery by the Company to the
Trustee of an Officers' Certificate and an Opinion of Counsel to the effect that
such sale or other disposition was made by the Company in accordance with the
provisions of the Indenture, including without limitation Section 4.10 of the
Indenture, the Trustee shall execute any documents reasonably required in order
to evidence the release of the Guaranteeing Subsidiary from its obligations
under this Subsidiary Guarantee.
(b) The Guaranteeing Subsidiary not released from its
obligations under this Subsidiary Guarantee shall remain liable for the full
amount of principal of and interest on the Notes and for the other obligations
of the Guaranteeing Subsidiary under the Indenture a provided in Article 10
thereof.
(6) No Recourse Against Others. No past, present or future
director, officer, employee, incorporator, shareholder or agent of the
Guaranteeing Subsidiary, as such, shall have any liability for any obligations
of the Company or any Subsidiary under the Notes, any Subsidiary Guarantees, the
Indenture or this Supplemental Indenture or for any claim based on, in respect
of, or by reason of, such obligations or their creation. Each Holder of the
Notes by accepting a Note waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the Notes. Such waiver may
not be effective to waive liabilities under the federal securities laws and it
is the view of the Commission that such a waiver is against public policy.
(7) THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED
TO CONSTRUE THIS SUPPLEMENTAL INDENTURE, THE INDENTURE, THE NOTES AND THE
SUBSIDIARY GUARANTEES.
(8) Counterparts. The parties may sign any number of copies of
this Supplemental Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement.
(9) Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction hereof.
(10) The Trustee. The Trustee shall not be responsible in any
manner whatsoever for or in respect of the validity or sufficiency of this
Supplemental Indenture or for or in respect of the recitals contained herein,
all of which recitals are made solely by the Guaranteeing Subsidiary and the
Company.
(11) Subrogation. The Guaranteeing Subsidiary shall be
subrogated to all rights of Holders of Notes against the Company in respect of
any amounts paid by the Guaranteeing Subsidiary pursuant to the provisions of
Section 2 hereof; provided, however, that, if an Event of Default has occurred
and is continuing, the Guaranteeing Subsidiary shall not be entitled to enforce
or receive any payments arising out of, or based upon, such right of subrogation
until all amounts then due and payable by the Company under the Indenture or the
Notes shall have been paid in full.
(12) Benefits Acknowledged. The Guaranteeing Subsidiary
acknowledges that it will receive direct and indirect benefits from the
financing arrangements contemplated by the Indenture and this Supplemental
Indenture and that the guarantee and waivers made by it pursuant to this
Subsidiary Guarantee are knowingly made in contemplation of such benefits.
(13) Successors. All agreements of the Guaranteeing Subsidiary
in this Supplemental Indenture shall bind its Successors, except as otherwise
provided in Section 2(k) hereof or elsewhere in
F-5
this Supplemental Indenture. All agreements of the Trustee in this Supplemental
Indenture shall bind its successors.
F-6
IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed, all as of the date first above
written.
Dated:______________, ____
XXXXXXXXX LUMBER CO. LTD.
By:
--------------------------------
Name:
Title:
By:
--------------------------------
Name:
Title:
XXXXXXXXX ENGINEERED CORP.
By:
--------------------------------
Name:
Title:
[GUARANTEEING SUBSIDIARY]
By:
--------------------------------
Name:
Title:
THE BANK OF NEW YORK, as Trustee
By:
--------------------------------
Authorized Signatory
F-7
