EXHIBIT 4.1
XXXXX INTERNATIONAL NETWORKS, LTD.
as Issuer,
and
UNITED STATES TRUST COMPANY OF NEW YORK
as Trustee
$100,000,000
11 3/4% SENIOR SECURED NOTES DUE 2005, SERIES A
11 3/4% SENIOR SECURED NOTES DUE 2005, SERIES B
_________________________________
____________________
INDENTURE
Dated as of July 10, 1998
____________________
CROSS-REFERENCE TABLE *
Trust Indenture
Act Section Indenture Section
303.................................................... 1.03
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)................................................ 7.06
(b)(2)................................................ 7.06
(c)................................................... 7.06
(d)................................................... 7.06
314(a)................................................. 4.03 and 4.04
(b)................................................... N.A.
(c)(1)................................................ 12.04 and 12.05
(c)(2)................................................ 12.04 and 12.05
(c)(3)................................................ N.A.
(d)................................................... N.A.
(e)................................................... 11.05
(f)................................................... N.A.
315(a)................................................. 7.01 and 7.02
(b)................................................... 7.05
(c)................................................... 7.01
(d)................................................... 6.05;7.01
(e)................................................... 6.11
316(a).................................................
(a)(1)(A)............................................. 6.05
(a)(1)(B)............................................. 6.04
(a)(2)................................................ N.A.
(b)................................................... 6.07
(c)................................................... 2.19
317(a)(1).............................................. 6.08
(a)(2)................................................ 6.09
(b)................................................... 2.04
318(a)................................................. 12.01
(b)................................................... N.A.
(c)................................................... 12.01
______________________
* This Cross-Reference Table is not part of the Indenture.
N.A. means not applicable.
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TABLE OF CONTENTS
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ARTICLE 1 DEFINITIONS AND INCORPORATION
SECTION 1.01. DEFINITIONS............................... 1
SECTION 1.02. OTHER DEFINITIONS......................... 25
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST
INDENTURE ACT............................ 26
SECTION 1.04. RULES OF CONSTRUCTION..................... 26
ARTICLE 2 THE SECURITIES
SECTION 2.01. FORM AND DATING............................ 27
SECTION 2.02. EXECUTION AND AUTHENTICATION............... 28
SECTION 2.03. REGISTRAR AND PAYING AGENT................. 29
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST........ 30
SECTION 2.05. SECURITYHOLDER LISTS....................... 30
SECTION 2.06. TRANSFER AND EXCHANGE...................... 30
SECTION 2.07. REPLACEMENT SECURITIES..................... 32
SECTION 2.08. OUTSTANDING SECURITIES..................... 33
SECTION 2.09. TREASURY SECURITIES........................ 33
SECTION 2.10. TEMPORARY SECURITIES....................... 34
SECTION 2.11. CANCELLATION............................... 34
SECTION 2.12. DEFAULTED INTEREST......................... 34
SECTION 2.13. CUSIP NUMBERS.............................. 35
SECTION 2.14. DEPOSIT OF MONEYS.......................... 35
SECTION 2.15. RESTRICTIVE LEGENDS........................ 35
SECTION 2.16. BOOK-ENTRY PROVISIONS FOR GLOBAL SECURITY.. 37
SECTION 2.17. SPECIAL TRANSFER PROVISIONS................ 37
SECTION 2.18. PERSONS DEEMED OWNERS...................... 42
SECTION 2.19. RECORD DATE................................ 42
ARTICLE 3 REDEMPTION
SECTION 3.01. NOTICES TO TRUSTEE......................... 43
SECTION 3.02. SELECTION OF SECURITIES TO BE REDEEMED..... 43
SECTION 3.03. NOTICE OF REDEMPTION....................... 44
SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION............. 45
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE................ 45
SECTION 3.06. SECURITIES REDEEMED IN PART................ 46
SECTION 3.07. OPTIONAL REDEMPTION........................ 46
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SECTION 3.08. MANDATORY REDEMPTION...................................................... 47
SECTION 3.09. OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS....................... 47
ARTICLE 4 COVENANTS
SECTION 4.01. PAYMENT OF SECURITIES..................................................... 49
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY........................................... 49
SECTION 4.03. SEC REPORTS............................................................... 50
SECTION 4.04. COMPLIANCE CERTIFICATES................................................... 50
SECTION 4.05. TAXES..................................................................... 51
SECTION 4.06. STAY, EXTENSION AND USURY LAWS............................................ 52
SECTION 4.07. LIMITATION ON RESTRICTED PAYMENTS......................................... 52
SECTION 4.08. LIMITATION ON RESTRICTIONS ON DISTRIBUTIONS FROM RESTRICTED SUBSIDIARIES.. 55
SECTION 4.09. LIMITATION ON INDEBTEDNESS................................................ 57
SECTION 4.10. LIMITATION ON SALES OF ASSETS AND SUBSIDIARY STOCK........................ 60
SECTION 4.11. LIMITATION ON AFFILIATE TRANSACTIONS...................................... 62
SECTION 4.12. LIMITATION ON LIENS....................................................... 63
SECTION 4.13. CORPORATE EXISTENCE....................................................... 63
SECTION 4.14. CHANGE OF CONTROL......................................................... 63
SECTION 4.15. LIMITATION ON ISSUANCES OF CAPITAL STOCK OF RESTRICTED SUBSIDIARIES....... 65
SECTION 4.16. CONDUCT OF BUSINESS....................................................... 65
SECTION 4.18. LIMITATION ON DESIGNATIONS OF UNRESTRICTED SUBSIDIARIES................... 66
SECTION 4.19. FURTHER INSTRUMENTS AND ACTS.............................................. 67
SECTION 4.20. SUBSIDIARY GUARANTEES..................................................... 68
ARTICLE 5 SUCCESSORS
SECTION 5.01. LIMITATIONS ON MERGER, CONSOLIDATION OR SALE OF ASSETS.................... 69
SECTION 5.02. SUCCESSOR CORPORATION SUBSTITUTED......................................... 70
ARTICLE 6 DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT......................................................... 70
SECTION 6.02. ACCELERATION.............................................................. 72
SECTION 6.03. OTHER REMEDIES............................................................ 73
SECTION 6.04. WAIVER OF PAST DEFAULTS................................................... 73
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SECTION 6.05. CONTROL BY MAJORITY.................................... 73
SECTION 6.06. LIMITATION ON SUITS.................................... 74
SECTION 6.07. RIGHTS OF SECURITYHOLDERS TO RECEIVE PAYMENT........... 74
SECTION 6.08. COLLECTION SUIT BY TRUSTEE............................. 74
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM....................... 75
SECTION 6.10. PRIORITIES............................................. 75
SECTION 6.11. UNDERTAKING FOR COSTS.................................. 76
ARTICLE 7 TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE...................................... 76
SECTION 7.02. RIGHTS OF TRUSTEE...................................... 78
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE........................... 79
SECTION 7.04. TRUSTEE'S DISCLAIMER................................... 79
SECTION 7.05. NOTICE OF DEFAULTS..................................... 79
SECTION 7.06. REPORTS BY TRUSTEE TO SECURITYHOLDERS.................. 79
SECTION 7.07. COMPENSATION AND INDEMNITY............................. 80
SECTION 7.08. REPLACEMENT OF TRUSTEE................................. 81
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC....................... 82
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.......................... 82
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE COMPANY.. 83
ARTICLE 8 DISCHARGE OF INDENTURE
SECTION 8.01. DISCHARGE OF LIABILITY ON SECURITIES; DEFEASANCE....... 83
SECTION 8.02. CONDITIONS TO DEFEASANCE............................... 84
SECTION 8.03. APPLICATION OF TRUST MONEY............................. 86
SECTION 8.04. REPAYMENT TO THE COMPANY............................... 86
SECTION 8.05. INDEMNITY FOR GOVERNMENT OBLIGATIONS................... 86
SECTION 8.06. REINSTATEMENT.......................................... 87
ARTICLE 9 AMENDMENTS
SECTION 9.01. WITHOUT CONSENT OF SECURITYHOLDERS..................... 87
SECTION 9.02. WITH CONSENT OF SECURITYHOLDERS........................ 88
SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.................... 90
SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS...................... 90
SECTION 9.05. NOTATION ON OR EXCHANGE OF SECURITIES.................. 91
SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC........................ 91
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SECTION 9.07. SUBSIDIARY GUARANTORS' SIGNATURE NOT REQUIRED.................. 91
ARTICLE 10 SUBSIDIARY GUARANTEES
SECTION 10.01. SUBSIDIARY GUARANTEES......................................... 92
SECTION 10.02. EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEE AGREEMENT...... 93
SECTION 10.03. SUBSIDIARY GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.. 94
SECTION 10.04. EFFECT OF DEFEASANCE.......................................... 94
SECTION 10.05. LIMITATION ON SUBSIDIARY GUARANTOR LIABILITY.................. 94
SECTION 10.06. STAY, EXTENSION AND USURY LAWS................................ 95
ARTICLE 11 RESERVE ACCOUNT
SECTION 11.01. ESTABLISHMENT OF RESERVE ACCOUNT.............................. 95
SECTION 11.02. INVESTMENT OF FUNDS IN RESERVE ACCOUNT........................ 95
SECTION 11.03. PLEDGE AND GRANT OF SECURITY INTEREST......................... 96
SECTION 11.04. DISBURSEMENTS................................................. 96
ARTICLE 12 MISCELLANEOUS
SECTION 12.01. TRUST INDENTURE ACT CONTROLS.................................. 97
SECTION 12.02. NOTICES....................................................... 97
SECTION 12.03. COMMUNICATION BY SECURITYHOLDERS WITH OTHER................... 98
SECTION 12.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT............ 98
SECTION 12.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION................. 99
SECTION 12.06. RULES BY TRUSTEE AND AGENTS................................... 99
SECTION 12.07. LEGAL HOLIDAYS................................................ 100
SECTION 12.08. NO RECOURSE AGAINST OTHERS.................................... 100
SECTION 12.09. DUPLICATE ORIGINALS........................................... 100
SECTION 12.10. GOVERNING LAW................................................. 100
SECTION 12.11. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS................. 100
SECTION 12.12. SUCCESSORS.................................................... 100
SECTION 12.13. SEVERABILITY.................................................. 101
SECTION 12.14. COUNTERPART ORIGINALS......................................... 101
SECTION 12.15. TABLE OF CONTENTS, HEADINGS, ETC............................... 101
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INDENTURE, dated as of July 10, 1998, among Xxxxx International
Networks, Ltd., a Colorado corporation (the "Company"), and United States Trust
Company of New York, a banking corporation organized and existing under the laws
of the State of New York, in its capacity as trustee (the "Trustee") and the
other entities parties hereto.
The Company has duly authorized the creation of an issue of 113/4%
Senior Secured Notes due 2005, Series A (the "Initial Securities") and 113/4%
Senior Secured Notes due 2005, Series B (the "Exchange Securities") and, to
provide therefor, the Company has duly authorized the execution and delivery of
this Indenture. All things necessary to make the Securities (as defined), when
duly issued and executed by the Company, and authenticated and delivered
hereunder, the valid obligations of the Company, and to make this Indenture a
valid and binding agreement of the Company, have been done.
The Company and the Trustee agree as follows for the benefit of each
other and for the equal and ratable benefit of the Holders of the Securities:
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
SECTION 1.01. DEFINITIONS.
"Acquisition Agreement" shall mean the Agreement, dated as of June 2,
1998, by and among Media America, Inc., Xxx Xxxxxxxxxx, Xxxx Xxxxxxxxx and Xxxxx
Network Holdings, LLC.
"Additional Assets" means (i) any property or assets (other than
Indebtedness and Capital Stock) in a Permitted Business; (ii) the Capital Stock
of a Person that becomes a Restricted Subsidiary as a result of the acquisition
of such Capital Stock by the Company or a Restricted Subsidiary of the Company;
(iii) Capital Stock constituting a minority interest in any Person that at such
time is a Restricted Subsidiary of the Company; or (iv) Permitted Investments of
the type and in the amounts described in clause (viii) of the definition
thereof; provided, however, that, in the case of clauses (ii) and (iii), such
Restricted Subsidiary is primarily engaged in a Permitted Business.
"Adjusted Net Assets" of a Subsidiary Guarantor at any date shall mean
the lesser of (x) the amount by which (x) the fair value of the property of such
Subsidiary Guarantor exceeds the total amount of liabilities, including, without
limitation, the probable liability of such Subsidiary Guarantor with respect to
its contingent liabilities (after giving effect to all other fixed and
contingent liabilities incurred or assumed on such
date), but excluding liabilities under the Subsidiary Guarantee of such
Subsidiary Guarantor at such date and (y) the amount by which the present fair
salable value of the assets of such Subsidiary Guarantor at such date exceeds
the amount that will be required to pay the probable liability of such
Subsidiary Guarantor on its debts (after giving effect to all other fixed and
contingent liabilities incurred or assumed on such date and after giving effect
to any collection from any Subsidiary by such Subsidiary Guarantor in respect of
the obligations of such Subsidiary under the Subsidiary Guarantee), excluding
debt in respect of the Subsidiary Guarantee, as they become absolute and
matured.
"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 the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Affiliate Business" means all or any portion of a business (including
related assets) from an Affiliate (other than a Restricted Subsidiary and, in
the case of any Restricted Subsidiary, any other Restricted Subsidiary).
"Agent" means any Registrar, Paying Agent or co-registrar.
"Agent Member" means a member of, or a participant in, the Depositary.
"Applicable Procedures" means, with respect to any transfer or
exchange of beneficial interests in a Global Note, the rules and procedures of
the Depositary, Euroclear and Cedel that are applicable to such transfer or
exchange.
"Asset Disposition" means any sale, lease, transfer, issuance or other
disposition (or series of related sales, leases, transfers, issuances or
dispositions that are part of a common plan) of shares of Capital Stock of (or
any other equity interests in) a Restricted Subsidiary (other than directors'
qualifying shares) or of any other property or other assets (each referred to
for the purposes of this definition as a "disposition") by the Company or any of
its Restricted Subsidiaries (including any disposition by means of a merger,
consolidation or similar transaction) other than (i) a disposition by a
Restricted Subsidiary to the Company or by the Company or a Restricted
Subsidiary to a Wholly-Owned Subsidiary, (ii) a disposition of inventory in the
ordinary course of business, (iii) the licensing of radio and cable television
programming in the ordinary course of business, (iv) the
2
disposition in the ordinary course of business of airtime and advertising
inventory, (v) a disposition of obsolete or worn out equipment or equipment that
is no longer useful in the conduct of the business of the Company and its
Restricted Subsidiaries and that is disposed of in each case in the ordinary
course of business, (vi) dispositions of property for net proceeds which, when
taken collectively with the net proceeds of any other such dispositions under
this clause (vi) that were consummated since the beginning of the calendar year
in which such disposition is consummated, do not exceed $1 million, and (vii)
transactions permitted under Section 5.01 hereof. Notwithstanding anything to
the contrary contained above, a Restricted Payment made in compliance with
Section 4.07 shall not constitute an Asset Disposition except for purposes of
determinations of the Consolidated Coverage Ratio.
"Attributable Indebtedness" in respect of a Sale/Leaseback Transaction
means, as at the time of determination, the present value (discounted at the
interest rate borne by the Securities, compounded annually) of the total
obligations of the lessee for rental payments during the remaining term of the
lease included in such Sale/Leaseback Transaction (including any period for
which such lease has been extended).
"Average Life" means, as of the date of determination, with respect to
any Indebtedness or Preferred Stock, the quotient obtained by dividing (i) the
sum of the product of the numbers of years (rounded upwards to the nearest
month) from the date of determination to the dates of each successive scheduled
principal payment of such Indebtedness or redemption or similar payment with
respect to such Preferred Stock multiplied by the amount of such payment by (ii)
the sum of all such payments.
"Bank Indebtedness" means loans to the Company or a Restricted
Subsidiary that are made by, and reimbursement obligations in respect of letters
of credit for the account of the Company or a Restricted Subsidiary that are
issued by, banks, trust companies and other institutions, principally engaged in
the business of lending money to businesses, under a credit facility, loan
agreement or similar agreement.
"Bankruptcy Law" means Title 11 of the U.S. Code or any similar
Federal or state law for the relief of debtors.
"Board of Directors" means, with respect to any Person, the Board of
Directors of such Person or any committee of the Board of Directors of such
Person duly authorized, with respect to any particular matter, to exercise the
power of the Board of Directors of such Person.
"Board Resolution" means, with respect to any Person, a copy of a
resolution certified by the Secretary or an Assistant Secretary of such Person
to have been duly adopted by the Board
3
of Directors of such Person and to be in full force and effect on the date of
such certification, and delivered to the Trustee.
"Business Day" means a day that is not a Legal Holiday.
"Capitalized Lease Obligations" means an obligation that is required
to be classified and accounted for as a capitalized lease for financial
reporting purposes in accordance with GAAP, and the amount of Indebtedness
represented by such obligation shall be the capitalized amount of such
obligation determined in accordance with GAAP, and the Stated Maturity thereof
shall be the date of the last payment of rent or any other amount due under such
lease prior to the first date such lease may be terminated without penalty.
"Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) equity of such Person, including any Preferred
Stock, but excluding any debt securities convertible into such equity.
"Cash Equivalents" means (i) United States dollars, (ii) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof, (iii) certificates of
deposit, time deposits and eurodollar time deposits with maturities of one year
or less from the date of acquisition, bankers' acceptances with maturities not
exceeding one year and overnight bank deposits, in each case with any commercial
bank having capital and surplus in excess of $500 million, (iv) repurchase
obligations for underlying securities of the types described in clauses (ii) and
(iii) entered into with any financial institution meeting the qualifications
specified in clause (iii) above, (v) commercial paper rated A-1 or the
equivalent thereof by Xxxxx'x or S&P and in each case maturing within one year
after the date of acquisition, (vi) investment funds investing 95% of their
assets in securities of the types described in clauses (i)-(v) above, (vii)
readily marketable direct obligations issued by any state of the United States
of America or any political subdivision thereof having one of the two highest
rating categories obtainable from either Xxxxx'x or S&P and (viii) Indebtedness
or Preferred Stock issued by Persons with a rating of "A" or higher from S&P or
"A2" or higher from Xxxxx'x.
"Certificated Notes" means Securities that are in the form of the
Securities attached hereto as Exhibit A-1, but do not include the information
called for by footnotes 1 and 3 thereof.
"Change of Control" means (i) any sale, lease, exchange or other
transfer (in one transaction or a series of related transactions) of all or
substantially all the assets of the Company and its Subsidiaries (to a Person
other than a Wholly Owned Subsidiary); or (ii) the Company shall cease to hold
directly all of the outstanding Capital Stock of Holdco; or (iii)
4
Xx. Xxxxx X. Xxxxx and/or his Permitted Transferees at any time cease to hold in
the aggregate, either directly or indirectly, Capital Stock having ordinary
voting power to elect a majority of directors of the Company.
"Commission" means the U.S. Securities and Exchange Commission or its
successor.
"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 Xxxxx International Networks, Ltd., a Colorado
corporation, until a successor replaces it in accordance with Article 5 hereof
and thereafter means the successor.
"Consolidated Adjusted Operating Cash Flow" means, with respect to any
period the Consolidated Net Income for such period increased by, to the extent
deducted in computing Consolidated Net Income, the sum of (i) depreciation and
(ii) amortization, determined on a consolidated basis in accordance with GAAP.
"Consolidated Cash Flow" for any period means the Consolidated Net
Income for such period, plus the following to the extent deducted in calculating
such Consolidated Net Income: (i) income tax expense, (ii) Consolidated Interest
Expense, (iii) depreciation expense, (iv) amortization expense, (v) exchange or
translation losses on foreign currencies, and (vi) all other non-cash items
reducing Consolidated Net Income (excluding any non-cash item to the extent it
represents an accrual of or reserve for cash disbursements for any subsequent
period prior to the Stated Maturity of the Securities) and less, to the extent
added in calculating Consolidated Net Income, (x) exchange or translation gains
on foreign currencies and (y) non-cash items (excluding such non-cash items to
the extent they represent an accrual for cash receipts reasonably expected to be
received prior to the Stated Maturity of the Securities), in each case for such
period. Notwithstanding the foregoing, the income tax expense, depreciation
expense and amortization expense of a Subsidiary of the Company shall be
included in Consolidated Cash Flow only to the extent (and in the same
proportion) that the net income of such Subsidiary was included in calculating
Consolidated Net Income.
"Consolidated Coverage Ratio" as of any date of determination means
the ratio of (i) the aggregate amount of Consolidated Cash Flow for the period
of the most recent four consecutive fiscal quarters ending prior to the date of
such determination and as to which financial statements are available to (ii)
Consolidated Interest Expense for such four fiscal quarters; provided, however,
that (1) if the Company or any of
5
its Restricted Subsidiaries has Incurred any Indebtedness since the beginning of
such period and through the date of determination of the Consolidated Coverage
Ratio that remains outstanding or if the transaction giving rise to the need to
calculate Consolidated Coverage Ratio is an Incurrence of Indebtedness, or both,
Consolidated Cash Flow and Consolidated Interest Expense for such period shall
be calculated after giving effect on a pro forma basis to (A) such Indebtedness
as if such Indebtedness had been Incurred on the first day of such period
(provided that if such Indebtedness is Incurred under a revolving credit
facility (or similar arrangement or under any predecessor revolving credit or
similar arrangement) only that portion of such Indebtedness that constitutes the
projected weighted average balance of such Indebtedness for the period beginning
on the first day of such four consecutive fiscal quarter period and ending on
the date one year subsequent to such date (as determined in good faith by the
Board of Directors of the Company and as adjusted to give effect to Indebtedness
that has been permanently repaid and the underlying commitment terminated and
has not been replaced) shall be deemed outstanding for purposes of this
calculation), and (B) the discharge of any other Indebtedness repaid,
repurchased, defeased or otherwise discharged with the proceeds of such new
Indebtedness as if such discharge had occurred on the first day of such period,
(2) if since the beginning of such period any Indebtedness of the Company or any
of its Restricted Subsidiaries has been repaid, repurchased, defeased or
otherwise discharged (other than Indebtedness under a revolving credit or
similar arrangement unless such revolving credit Indebtedness has been
permanently repaid and the underlying commitment terminated and has not been
replaced), Consolidated Interest Expense for such period shall be calculated
after giving pro forma effect thereto as if such Indebtedness had been repaid,
repurchased, defeased or otherwise discharged on the first day of such period,
(3) if since the beginning of such period the Company or any of its Restricted
Subsidiaries shall have made any Asset Disposition or if the transaction giving
rise to the need to calculate the Consolidated Coverage Ratio is an Asset
Disposition, Consolidated Cash Flow for such period shall be reduced by an
amount equal to the Consolidated Cash Flow (if positive) attributable to the
assets which are the subject of such Asset Disposition for such period or
increased by an amount equal to the Consolidated Cash Flow (if negative)
attributable thereto for such period, and Consolidated Interest Expense for such
period shall be (i) reduced by an amount equal to the Consolidated Interest
Expense attributable to any Indebtedness of the Company or any of its Restricted
Subsidiaries repaid, repurchased, defeased or otherwise discharged with respect
to the Company and its continuing Restricted Subsidiaries in connection with
such Asset Disposition for such period (or, if the Capital Stock of any
Restricted Subsidiary of the Company is sold, the Consolidated Interest Expense
for such period directly attributable to the Indebtedness of such Restricted
Subsidiary to the extent the Company and its continuing Restricted Subsidiaries
are no longer liable for such
6
Indebtedness after such sale) and (ii) increased by interest income attributable
to the assets which are the subject of such Asset Disposition for such period,
(4) if since the beginning of such period the Company or any of its Restricted
Subsidiaries (by merger or otherwise) shall have made an Investment in any
Restricted Subsidiary of the Company (or any Person which becomes a Restricted
Subsidiary of the Company as a result thereof) or an acquisition of assets which
constitutes all or substantially all of an operating unit or a business in
connection with a transaction causing a calculation to be made hereunder,
Consolidated Cash Flow and Consolidated Interest Expense for such period shall
be calculated after giving pro forma effect thereto (including the Incurrence of
any Indebtedness) as if such Investment or acquisition occurred on the first day
of such period and (5) if since the beginning of such period any Person (that
subsequently became a Restricted Subsidiary of the Company or was merged with or
into the Company or any Restricted Subsidiary of the Company since the beginning
of such period) shall have made any Asset Disposition, Investment or acquisition
of assets that would have required an adjustment pursuant to clause (3) or (4)
above if made by the Company or a Restricted Subsidiary of the Company during
such period, Consolidated Cash Flow and Consolidated Interest Expense for such
period shall be calculated after giving pro forma effect thereto as if such
Asset Disposition, Investment or acquisition occurred on the first day of such
period. For purposes of this definition, whenever pro forma effect is to be
given to an acquisition or disposition of assets, the amount of income or
earnings relating thereto and the amount of Consolidated Interest Expense
associated with any Indebtedness Incurred in connection therewith, the pro forma
calculations shall be determined in good faith by a responsible financial or
accounting officer of the Company. If any Indebtedness being Incurred bears a
floating rate of interest and is being given pro forma effect, the interest
expense on such Indebtedness shall be calculated as if the rate in effect on the
date of determination had been the applicable rate for the entire period (taking
into account any Interest Rate Agreement applicable to such Indebtedness if such
Interest Rate Agreement has a remaining term in excess of 12 months).
"Consolidated Interest Expense" means, for any period, the total
interest expense of the Company and its Restricted Subsidiaries determined in
accordance with GAAP, plus, to the extent not included in such interest expense
(i) interest expense attributable to Capitalized Lease Obligations, (ii)
amortization of debt discount, (iii) capitalized interest, (iv) non-cash
interest expense, (v) commissions, discounts and other fees and charges owed
with respect to letters of credit and bankers' acceptance financing, (vi)
interest actually paid by the Company or any such Restricted Subsidiary under
any Guarantee of Indebtedness or other obligation of any other Person, (vii) net
payments (whether positive or negative) pursuant to Interest Rate Agreements,
(viii) the cash contributions to any employee stock ownership plan or similar
trust to the extent such contributions
7
are used by such plan or trust to pay interest or fees to any Person (other than
the Company) in connection with Indebtedness Incurred by such plan or trust and
(ix) cash and Disqualified Stock dividends in respect of all Preferred Stock of
Subsidiaries and Disqualified Stock of the Company held by Persons other than
the Company or a Wholly-Owned Subsidiary and less (a) to the extent included in
such interest expense, the amortization of capitalized debt issuance costs and
(b) interest income. Notwithstanding the foregoing, the Consolidated Interest
Expense with respect to any Restricted Subsidiary of the Company, that was not a
Wholly-Owned Subsidiary, shall be included only to the extent (and in the same
proportion) that the net income of such Restricted Subsidiary was included in
calculating Consolidated Net Income.
"Consolidated Net Income" means, for any period, the consolidated net
income (loss) of the Company and its consolidated Subsidiaries determined in
accordance with GAAP; provided, however, that there shall not be included in
such Consolidated Net Income: (i) any net income (loss) of any Person acquired
by the Company or any of its Restricted Subsidiaries in a pooling of interests
transaction for any period prior to the date of such acquisition, (ii) any net
income of any Restricted Subsidiary of the Company if such Restricted Subsidiary
is subject to restrictions, directly or indirectly, on the payment of dividends
or the making of distributions by such Restricted Subsidiary, directly or
indirectly, to the Company (other than restrictions in effect on the Issue Date
with respect to a Restricted Subsidiary of the Company and other than
restrictions that are created or exist in compliance with the "Limitation on
Restrictions on Distributions from Restricted Subsidiaries" covenant), (iii) any
gain or loss realized upon the sale or other disposition of any assets of the
Company or its consolidated Restricted Subsidiaries (including pursuant to any
Sale/Leaseback Transaction) which are not sold or otherwise disposed of in the
ordinary course of business and any gain or loss realized upon the sale or other
disposition of any Capital Stock of any Person, (iv) any extraordinary gain or
loss, (v) the cumulative effect of a change in accounting principles, (vi) the
net income of any Person, other than a Restricted Subsidiary, except to the
extent of the lesser of (A) cash dividends or distributions actually paid to the
Company or any of its Restricted Subsidiaries by such Person and (B) the net
income of such Person (but in no event less than zero), (vii) the net loss of
any Person (other than a Subsidiary) in excess of the aggregate Investment of
the Company or any of its Restricted Subsidiaries in such Person and (viii) any
non-cash expenses attributable to grants or exercises of employee stock options.
Notwithstanding the foregoing, (A) Consolidated Net Income for any period shall
be reduced by the aggregate amount of dividends paid during such period pursuant
to clause (v) of paragraph (b) of Section 4.07 and (B) for the purpose of
Section 4.07 only, there shall be excluded from Consolidated Net Income, as such
term is used in calculating Consolidated Adjusted Operating Cash Flow, any
dividends,
8
repayments of loans or advances or other transfers of assets from Unrestricted
Subsidiaries to the Company or a Restricted Subsidiary to the extent such
dividends, repayments or transfers increase the amount of Restricted Payments
permitted under Section 4.07(a)(iii)(D) hereof.
"Consolidated Net Worth" means the total of the amounts shown on the
balance sheet of the Company and its consolidated Restricted Subsidiaries,
determined on a consolidated basis in accordance with GAAP, as of the end of the
most recent fiscal quarter of the Company ending prior to the taking of any
action for the purpose of which the determination is being made and for which
financial statements are available (but in no event ending more than 135 days
prior to the taking of such action), as (i) the par or stated value of all
outstanding Capital Stock of the Company plus (ii) paid in capital or capital
surplus relating to such Capital Stock plus (iii) any retained earnings or
earned surplus less (A) any accumulated deficit and (B) any amounts attributable
to Disqualified Stock.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 12.02 or such other address as to which the Trustee
may give notice to the Company.
"Cumulative Available Cash Flow" means, as of any date of
determination, the positive cumulative Consolidated Adjusted Operating Cash
Flow, or, if such cumulative Consolidated Adjusted Operating Cash Flow for such
period is negative, the amount by which cumulative Consolidated Adjusted
Operating Cash Flow is less than zero.
"Currency Agreement" means in respect of a Person any foreign exchange
contract, currency swap agreement or other similar agreement as to which such
Person is a party or a beneficiary.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Depositary" means The Depositary Trust Company, its nominees and
successors.
"Disinterested Director" means a member of the Board of Directors of
the Company who is not otherwise affiliated with the Company and who is not
otherwise involved or interested in the transaction in question.
"Disqualified Stock" means any Capital Stock which, by its terms (or
by the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event (other than an event which
would constitute a Change of Control), (i) matures (excluding any maturity as
the result of an optional redemption by the issuer thereof) or is mandatorily
redeemable, pursuant to a sinking fund
9
obligation or otherwise, or is redeemable at the option of the holder thereof,
in whole or in part, on or prior to the Stated Maturity of the Securities, or
(ii) is convertible into or exchangeable (unless at the sole option of the
issuer thereof) for (a) debt securities or (b) any Capital Stock referred to in
(i) above, in each case at any time prior to the Stated Maturity of the
Securities; provided, that Capital Stock issued pursuant to the Acquisition
Agreement and the MSO Agreements entered into by the Company as of the Issue
Date shall not be considered Disqualified Stock. Disqualified Stock shall be
deemed to be Incurred as Indebtedness in an amount equal to (i) the greater of
its maximum voluntary or involuntary liquidation preference or repurchase price,
if any, plus accrued and unpaid dividends or (ii) if redeemable at fair market
value or at some fixed premium over fair market value, the then average closing
price on the principal securities exchange or automated quotation system on
which such Disqualified Stock is listed or eligible for trading on the five
trading days immediately preceding the date on which it is issued or, if not so
listed or eligible, the value as of such date as determined in writing by an
independent investment banking firm of nationally recognized standing plus, in
either case, any applicable premium.
"Equity Offering" means an offering for cash by the Company of its
common stock, or options, warrants or rights with respect to its common stock.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
or any successor statute or statutes thereto.
"Exchange Offer" means the registration by the Company under the
Securities Act pursuant to a registration statement of the offer by the Company
to each Securityholder of the Initial Securities to exchange all the Initial
Securities held by such Securityholder for the Exchange Securities in an
aggregate principal amount equal to the aggregate principal amount of the
Initial Securities held by such Securityholder, in accordance with the terms and
conditions of the Registration Rights Agreement.
"Exchange Securities" has the meaning set forth in the preamble to
this Indenture.
"Existing Indebtedness" means Indebtedness of the Company or its
Restricted Subsidiaries in existence on the Issue Date, plus interest accrued
thereon, after application of the net proceeds of the sale of the Securities as
described in the Offering Memorandum; provided, however, that the existing
Capital Lease Obligations relating to satellite transponders, in an amount not
in excess of $28.2 million, shall constitute "Existing Indebtedness" only for a
maximum period of 14 days following the Issue Date.
10
"fair market value" means, with respect to any asset or property, the
price which could be negotiated in an arms-length, free market transaction, for
cash, between a willing seller and a willing and able buyer, neither of whom is
under undue pressure or compulsion to complete the transaction. Except as
otherwise expressly provided, fair market value shall be determined by the Board
of Directors of the Company acting reasonably and in good faith and shall be
evidenced by a Board Resolution of the Board of Directors of the Company
delivered to the Trustee.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the date hereof, including those set forth
in the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant segment of the
accounting profession. All ratios and computations based on GAAP contained
herein shall be computed in conformity with GAAP.
"Global Notes" means, individually and collectively, the Regulation S
Temporary Global Note, the Regulation S Permanent Global Note and the QIB
Restricted Note.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness of any other Person
and any obligation, direct or indirect, contingent or otherwise, of such Person
(i) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness of such other Person (whether arising by virtue of
partnership arrangements, or by agreement to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise) or (ii) entered into for purposes of assuring
in any other manner the obligee of such Indebtedness of the payment thereof or
to protect such obligee against loss in respect thereof (in whole or in part);
provided, however, that the term "Guarantee" shall not include endorsements for
collection or deposit in the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning.
"Holdco" means JPN, Inc., a Colorado corporation and a Wholly-Owned
Subsidiary of the Company.
"Incur" means issue, assume, guarantee, incur or otherwise become
liable for, and "Incurrence" has a corresponding meaning; provided, however,
that (i) any Indebtedness or Disqualified Stock of a Person existing at the time
such Person becomes a Restricted Subsidiary (whether by merger, consolidation,
acquisition or otherwise) shall be deemed to be Incurred at the time it becomes
a Restricted Subsidiary and (ii) neither the accrual of interest nor the
accretion of discount on
11
Indebtedness shall be deemed to be an Incurrence of additional Indebtedness.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication), (i) the principal of and premium (if any)
in respect of indebtedness of such Person for borrowed money, (ii) the principal
of and premium (if any) in respect of obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments, (iii) all obligations of
such Person in respect of letters of credit or other similar instruments
(including reimbursement obligations with respect thereto) (other than
obligations with respect to letters of credit securing obligations (other than
obligations described in clauses (i), (ii) and (v) entered into in the ordinary
course of business of such Person to the extent that such letters of credit are
not drawn upon or, if and to the extent drawn upon, such drawing is reimbursed
no later than the third business day following receipt by such Person of a
demand for reimbursement following payment on the letter of credit), (iv) all
obligations of such Person to pay the deferred and unpaid purchase price of
property or services (except trade payables and accrued expenses Incurred in the
ordinary course of business), which purchase price is due more than six months
after the date of placing such property in service or taking delivery and title
thereto or the completion of such services, (v) all Capitalized Lease
Obligations and all Attributable Indebtedness of such Person, (vi) all
Indebtedness of other Persons secured by a Lien on any asset of such Person,
whether or not such Indebtedness is assumed by such Person, (vii) all
Indebtedness of other Persons to the extent Guaranteed by such Person, (viii)
the amount of all obligations of such Person with respect to the redemption,
repayment or other repurchase of any Disqualified Stock or, with respect to any
Restricted Subsidiary of the Company, any Preferred Stock of such Restricted
Subsidiary to the extent such obligation arises on or before the Stated Maturity
of the Securities (but excluding, in each case, accrued dividends) with the
amount of Indebtedness represented by such Disqualified Stock or Preferred
Stock, as the case may be, being equal to the greater of its voluntary or
involuntary liquidation preference and its maximum fixed repurchase price;
provided that, for purposes hereof the "maximum fixed repurchase price" of any
Disqualified Stock or Preferred Stock, as the case may be, which does not have a
fixed repurchase price shall be calculated in accordance with the terms of such
Disqualified Stock or Preferred Stock, as the case may be, as if such
Disqualified Stock or Preferred Stock, as the case may be, were purchased on any
date on which Indebtedness shall be required to be determined pursuant to the
Indenture, and if such price is based on the fair market value of such
Disqualified Stock or Preferred Stock, as the case may be, such fair market
value shall be determined in good faith by the Board of Directors of the Company
and (ix) to the extent not otherwise included in this definition, obligations
under Currency Agreements and Interest Rate Agreements. Unless specifically set
forth above, the amount of Indebtedness of any
12
Person at any date shall be the outstanding principal amount of all
unconditional obligations as described above, as such amount would be reflected
on a balance sheet prepared in accordance with GAAP, and the maximum liability
of such Person, upon the occurrence of the contingency giving rise to the
obligation, of any contingent obligations described above at such date.
Indebtedness shall not include any obligation to purchase or redeem the Capital
Stock of the Company pursuant to the terms of the MSO Agreements as in effect on
the Issue Date or the Acquisition Agreement.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Initial Purchaser" means NatWest Capital Markets Limited.
"Initial Securities" has the meaning set forth in the preamble to this
Indenture.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"interest" includes Additional Interest (as defined in the
Registration Rights Agreement), if any.
"Interest Payment Date" means the Stated Maturity of an installment of
interest on the Securities which shall be each January 1 and July 1 of each
year, commencing January 1, 1999.
"Interest Rate Agreement" means with respect to any Person any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement as to which such Person is party or a
beneficiary.
"Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of business that are
recorded as accounts payable on the balance sheet of such Person) or other
extension of credit (including by way of Guarantee or similar arrangement, but
excluding any debt or extension of credit represented by a bank deposit other
than a time deposit) or capital contribution to (by means of any transfer of
cash or other property (excluding Capital Stock (other than Disqualified Stock)
of the Company) to others or any payment for property or services for the
account or use of others), or any purchase or acquisition of Capital Stock,
Indebtedness or other similar instruments issued by such Person. For purposes
of Section 4.07 and determinations relating to Permitted Basket Investments, (i)
"Investment" shall include the
13
portion (proportionate to the Company's equity interest in a Restricted
Subsidiary to be designated as an Unrestricted Subsidiary or in a Wholly Owned
Subsidiary that otherwise ceases to qualify as such) of the fair market value of
the net assets of such Subsidiary of the Company at the time that such
Restricted Subsidiary is designated an Unrestricted Subsidiary or such Wholly
Owned Subsidiary otherwise ceases to qualify as such; provided, however, that
upon a redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary or
upon the qualification of a non-wholly owned Restricted Subsidiary as a Wholly
Owned Subsidiary, the Company shall be deemed to continue to have a permanent
"Investment" in an Unrestricted Subsidiary or a non-wholly owned Restricted
Subsidiary in an amount (if positive) equal to (x) the Company's "Investment" in
such Subsidiary at the time of such redesignation or qualification less (y) the
portion (proportionate to the Company's equity interest in such Subsidiary) of
the fair market value of the net assets of such Subsidiary at the time that such
Subsidiary is so redesignated a Restricted Subsidiary or qualifies as a Wholly
Owned Subsidiary; and (ii) any property transferred to or from an Unrestricted
Subsidiary or a Restricted Subsidiary that is not a Wholly Owned Subsidiary
shall be valued at its fair market value at the time of such transfer, in each
case as determined in good faith by the Board of Directors and evidenced by a
resolution of such Board of Directors certified in an Officers' Certificate to
the Trustee.
"Issue Date" means the date on which the Securities are originally
issued.
"Lien" means any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including any conditional sale or other title
retention agreement or lease in the nature thereof).
"Maturity Date" means July 1, 2005.
"Moody's" means Xxxxx'x Investors Service, Inc.
"MSO Agreements" means agreements with multiple system operators of
cable television systems providing for the issuance of Class A Common Stock of
the Company in exchange for specified service commitments, entered into in
accordance with the Company's historical practice.
"Net Available Cash" from an Asset Disposition means cash payments
received (including any cash payments received by way of deferred payment of
principal pursuant to a note or installment receivable or otherwise, but only as
and when received, but excluding any other consideration received in the form of
assumption by the acquiring Person of Indebtedness or other obligations relating
to the properties or assets subject to such Asset Disposition) therefrom in each
case net of (i) all legal, title and recording tax expenses, commissions and
other fees and expenses incurred, and all Federal, state, foreign and
14
local taxes required to be paid or accrued as a liability under GAAP, as a
consequence of such Asset Disposition, (ii) all payments made on any
Indebtedness which is secured by any assets subject to such Asset Disposition,
in accordance with the terms of any Lien upon such assets, or which must by its
terms, or in order to obtain a necessary consent to such Asset Disposition or by
applicable law, be repaid out of the proceeds from such Asset Disposition, (iii)
all distributions and other payments made to any Person owning a beneficial
interest in assets subject to sale or minority interest holders in Subsidiaries
or joint ventures as a result of such Asset Disposition, (iv) the deduction of
appropriate amounts to be provided by the seller as a reserve, in accordance
with GAAP, against any liabilities associated with the assets disposed of in
such Asset Disposition; provided, however, that upon any reduction in such
reserves (other than to the extent resulting from payments of the respective
reserved liabilities), Net Available Cash shall be increased by the amount of
such reduction to reserves, and retained by the Company or any Restricted
Subsidiary of the Company after such Asset Disposition and (v) any portion of
the purchase price from an Asset Disposition placed in escrow (whether as a
reserve for adjustment of the purchase price, for satisfaction of indemnities in
respect of such Asset Disposition or otherwise in connection with such Asset
Disposition); provided, however, that upon the termination of such escrow, Net
Available Cash shall be increased by any portion of funds therein released to
the Company or any Restricted Subsidiary.
"Net Cash Proceeds" with respect to any issuance or sale of Capital
Stock, means the cash proceeds of such issuance or sale net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees and expenses,
discounts or commissions and brokerage, consultant and other fees actually
incurred in connection with such issuance or sale and net of taxes paid or
payable as a result of such issuance or sale.
"Obligations" means any principal, premium, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offering Memorandum" means the Offering Memorandum dated July 2,
1998, pursuant to which the Initial Securities were offered, and any supplements
thereto.
"Officer" means the Chairman of the Board, the Chief Executive
Officer, the Chief Financial Officer, or any Vice President, the Treasurer or
the Secretary of the Company.
"Officer's Certificate" means a certificate signed by two Officers of
the Company, at least one of whom shall be the principal executive, financial or
accounting officer of the Company.
15
"Opinion of Counsel" means a written opinion, in form and substance
acceptable to the Trustee, from legal counsel, which may be internal counsel to
the Company, who is acceptable to the Trustee.
"Paying Agent" means United States Trust Company of New York, as
paying agent hereunder, or any successor thereto appointed pursuant hereto.
"Permitted Basket Investment" means an Investment by the Company or a
Restricted Subsidiary in a Restricted Subsidiary (other than a Wholly Owned
Subsidiary), an Unrestricted Subsidiary or any other Person engaged in a
Permitted Business, including without limitation a loan or advance to, or
Guarantee of Indebtedness of, a Restricted Subsidiary (other than a Wholly Owned
Subsidiary), an Unrestricted Subsidiary or any other Person engaged in a
Permitted Business; provided, however, that no such Investment may qualify as a
Permitted Basket Investment to the extent the amount thereof, when taken
together with all other such Investments that qualify as Permitted Basket
Investments, would exceed an aggregate amount outstanding at any time equal to
the sum of (i) $10 million plus (ii) to the extent not previously reinvested as
a Permitted Basket Investment, any interest payment or dividend or other
distribution from cumulative earnings realized on any Permitted Basket
Investments, or any release or other cancellation of any Guarantee constituting
a Permitted Basket Investment plus (iii) to the extent not previously reinvested
as a Permitted Basket Investment, any return of capital on a Permitted Basket
Investment (including any deemed return of capital resulting from the
designation or qualification of the recipient thereof as a Restricted Subsidiary
(if such recipient was previously an Unrestricted Subsidiary) or as a Wholly
Owned Subsidiary (if such recipient was previously a non-wholly owned Restricted
Subsidiary)) less (iv) all losses realized on the sale or other disposition of
Permitted Basket Investments.
"Permitted Business" means any business which is the same as or
related, ancillary or complementary to any of the businesses of the Company and
its Restricted Subsidiaries on the date of the Indenture, as reasonably
determined by the Company's Board of Directors, including, without limitation,
advertising sales, services and new programming, networks, products and services
related, ancillary or complementary to any of the businesses of the Company and
its Restricted Subsidiaries on the date of the Indenture; and all aspects of
satellite delivery and production support, services and facilities; provided,
that, an entity which is not an operating entity and whose primary business is
to hold or maintain intellectual property or licenses shall not qualify as a
"Permitted Business."
"Permitted Investment" means an Investment by the Company or any of
its Restricted Subsidiaries in (i) a Wholly-Owned Subsidiary of the Company;
provided, however, that the
16
primary business of such Wholly-Owned Subsidiary is a Permitted Business; (ii)
another Person if as a result of such Investment such other Person becomes a
Wholly-Owned Subsidiary of the Company or is merged or consolidated with or
into, or transfers or conveys all or substantially all its assets to, the
Company or a Wholly-Owned Subsidiary of the Company; provided, however, that in
each case such Person's primary business is a Permitted Business, (iii)
Temporary Cash Investments; (iv) receivables owing to the Company or any of its
Restricted Subsidiaries, created or acquired in the ordinary course of business
and payable or dischargeable in accordance with customary trade terms; (v)
payroll, travel and similar advances to cover matters that are expected at the
time of such advances ultimately to be treated as expenses for accounting
purposes and that are made in the ordinary course of business; (vi) loans and
advances to employees made in the ordinary course of business consistent with
past practices of the Company or such Restricted Subsidiary in an aggregate
amount outstanding at any one time not to exceed $500,000; (vii) loans or
advances to senior management of the Company which loans or advances are secured
by shares of Common Stock of the Company owned by such senior management in an
aggregate amount outstanding not to exceed $750,000; (viii) stock, obligations
or securities received in settlement of debts created in the ordinary course of
business and owing to the Company or any of its Restricted Subsidiaries or in
satisfaction of judgments or claims; (ix) a Permitted Basket Investment; (x)
Persons to the extent such Investment is received by the Company or any
Restricted Subsidiary as consideration for Asset Dispositions effected in
compliance with Section 4.10; (xi) prepayments and other credits to suppliers
made in the ordinary course of business consistent with the past practices of
the Company and its Restricted Subsidiaries; and (xii) Investments in connection
with pledges, deposits, payments or performance bonds made or given in the
ordinary course of business in connection with or to secure statutory,
regulatory or similar obligations, including obligations under health, safety or
environmental obligations.
"Permitted Liens" means: (i) Liens imposed by law, such as carriers',
warehousemen's and mechanics' Liens, in each case for sums not yet due from the
Company or any Restricted Subsidiary or being contested in good faith by
appropriate proceedings by the Company or any Restricted Subsidiary, as the case
may be, or other Liens arising out of judgments or awards against the Company or
any Restricted Subsidiary with respect to which the Company or such Restricted
Subsidiary, as the case may be, will then be prosecuting an appeal or other
proceedings for review; (ii) Liens for property taxes or other taxes,
assessments or governmental charges of the Company or any Restricted Subsidiary
not yet due or payable or subject to penalties for nonpayment or which are being
contested by the Company or such Restricted Subsidiary, as the case may be, in
good faith by appropriate proceedings; (iii) Liens in favor of issuers of
performance, surety and other bonds issued pursuant to clause
17
(b)(vi) under Section 4.09; (iv) survey exceptions, encumbrances, easements or,
reservations of, or rights of others for, licenses, rights-of-way, sewers,
electric lines, telegraph and telephone lines and other similar purposes or
zoning or other restrictions as to the use of real property of the Company or
any Restricted Subsidiary incidental to the ordinary course of conduct of the
business of the Company or such Restricted Subsidiary or as to the ownership of
properties of the Company or any Restricted Subsidiary, which, in either case,
were not incurred in connection with Indebtedness and which do not in the
aggregate materially adversely affect the value of said properties or materially
impair their use in the operation of the business of the Company or any
Restricted Subsidiary; (v) Liens outstanding immediately after the Issue Date as
set forth on Schedule 1 hereto; (vi) Liens on property or assets of any Person
----------
at the time such Person becomes a Restricted Subsidiary of the Company;
provided, however, that (A) if any such Lien has been Incurred in anticipation
of such transaction, such property or assets subject to such Lien will have a
fair market value at the date of the acquisition thereof not in excess of the
lesser of (1) the aggregate purchase price paid or owed in connection with the
acquisition of such Person and (2) the fair market value of all property and
assets of such Person and (B) any such Lien will not extend to any other assets
owned by the Company or any Restricted Subsidiary; (vii) Liens on property or
assets at the time the Company or any Restricted Subsidiary acquires such
assets, including any acquisition by means of a merger or consolidation with or
into the Company or such Restricted Subsidiary; provided, however, that (A) if
any such Lien is Incurred in anticipation of such transaction, such property or
assets subject to such Lien will have a fair market value at the date of the
acquisition thereof not in excess of the lesser of (1) the aggregate purchase
price paid or owed in connection with the acquisition thereof and of any other
property and assets acquired simultaneously therewith and (2) the fair market
value of all such property and assets acquired by the Company or such Restricted
Subsidiary and (B) any such Lien will not extend to any other property or assets
owned by the Company or any Restricted Subsidiary; (viii) Liens securing
Indebtedness or other obligations of a Restricted Subsidiary owing to the
Company or a Wholly Owned Subsidiary; (ix) Liens to secure any extension,
renewal, refinancing, replacement or refunding (or successive extensions,
renewals, refinancings, replacements or refundings), in whole or in part, of any
Indebtedness secured by Xxxxx referred to in any of clauses (v), (vi) and (vii);
provided, however, that any such Lien will be limited to all or part of the same
property or assets that secured the original Lien (plus improvements on such
property) and the aggregate principal amount of Indebtedness that is secured by
such Lien will not be increased to an amount greater than the sum of (A) the
outstanding principal amount, or, if greater, the committed amount, of the
Indebtedness secured by Xxxxx described under clauses (v), (vi) and (vii) at the
time the original Lien became a Permitted Lien hereunder and (B) an amount
necessary to pay any premiums, fees and other expenses Incurred
18
by the Company in connection with such refinancing, refunding, extension,
renewal or replacement; (x) Liens on property or assets of the Company securing
Interest Rate Agreements and Currency Agreements so long as the related
Indebtedness is permitted under Section 4.09, and is secured by a Lien on the
same property securing the relevant Interest Rate Agreement or Currency
Agreement; (xi) Liens on property or assets of the Company or any Restricted
Subsidiary securing Indebtedness (1) under purchase money obligations, mortgage
financings or Capital Lease Obligations permitted under Section 4.09 or (2)
under Sale/Leaseback Transactions permitted under Section 4.17 or Section 4.09;
provided, that (A) the amount of Indebtedness Incurred in any specific case does
not, at the time such Indebtedness is Incurred, exceed the lesser of the cost or
fair market value of the property or asset acquired or constructed in connection
with such purchase money obligation, mortgage financing or Capital Lease
Obligation or subject to such Sale/Leaseback Transaction, as the case may be,
(B) such Lien will attach to such property or asset upon acquisition of such
property or asset and or upon commencement of such Sale/Leaseback Transaction,
as the case may be, and (C) no property or asset of the Company or any
Restricted Subsidiary (other than the property or asset acquired or contracted
in connection with such purchase money obligation, mortgage financing or Capital
Lease Obligation or subject to such Sale/Leaseback Transaction, as the case may
be) is subject to any Lien securing such Indebtedness; (xii) Liens granted to
the Trustee securing the Company's obligations under the Indenture; (xiii) Liens
on assets of a Restricted Subsidiary and/or the Company securing Bank
Indebtedness permitted under clause (b)(i) of Section 4.09 and outstanding in an
aggregate principal amount not exceeding $20 million; provided, that such
Restricted Subsidiary and/or the Company, as the case may be, is permitted to
incur liability with respect to such Bank Indebtedness under paragraph (d) of
Section 4.09; (xiv) Liens on satellite transponders and/or transponder capacity,
transmitting facilities and/or capacity, and related assets acquired with the
proceeds of, and that secure the repayment of, Replacement Satellite
Indebtedness permitted under Section 4.09; and (xv) Liens on assets of the
Restricted Subsidiaries and/or the Company securing any combination of
additional Bank Indebtedness, additional Capitalized Lease Obligations,
additional Attributable Indebtedness in respect of Sale/Leaseback Transactions
and Indebtedness permitted under clause (b)(ix) of Section 4.09; provided that,
(A) at the time such Lien is granted and after giving effect to the Indebtedness
secured thereby, (I) the Consolidated Coverage Ratio is greater than or equal to
2.5:1, and (II) the ratio of (x) all Indebtedness that is secured by Liens on
any assets of the Company and its Restricted Subsidiaries (other than
Replacement Satellite Indebtedness) to (y) an amount equal to the sum of $120
million plus the maximum amount of Indebtedness of the Company and its
Restricted Subsidiaries (other than Replacement Satellite Indebtedness) that
could be Incurred under paragraph (a) of Section 4.09 (for which purpose all
such Indebtedness not then outstanding shall be
19
deemed to bear interest at a rate equal to the weighted average interest rate on
all outstanding Indebtedness) does not exceed 1.0:6 and (B) in the case of
additional Bank Indebtedness, such Liens are on property or assets of a Person
that is permitted to incur liability with respect to such Bank Indebtedness
under Section 4.09(d).
"Permitted Transferee" means, with respect to a Person, (i) the
spouse, parent or lineal descendant of such Person, (ii) a trustee, guardian or
custodian for, or an executor, administrator or other legal representative of
the estate of such Person, (iii) the trustee of a trust for the benefit of such
Person or its Permitted Transferees and (iv) a corporation, partnership or other
entity of which such Person and its Permitted Transferees are the beneficial
owners of, and control the Capital Stock representing, a majority of the
ordinary voting power.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
hereof or any other entity.
"Preferred Stock," as applied to the Capital Stock of any corporation,
means Capital Stock of any class or classes (however designated) which is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"Private Placement Legend" has the meaning provided in Section 2.15.
"QIB Restricted Note" means a Security initially bearing CUSIP number
000000XX0 through which QIBs hold a beneficial interest in the permanent global
note that contains the paragraph referred to in footnote 1 and the additional
schedule referred to in footnote 3 to the form of the Security attached hereto
as Exhibit A-1, and that is deposited with and registered in the name of the
Depositary, or any replacement Security issued therefor.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A under the Securities Act.
"Record Date" means the record dates specified in the Securities,
whether or not a Legal Holiday.
"Refinancing Indebtedness" means Indebtedness that refunds,
refinances, replaces, renews, repays or extends (including pursuant to any
defeasance or discharge mechanism) (collectively, "refinances," and "refinanced"
shall have a
20
correlative meaning) any Indebtedness existing on the date of the Indenture or
Incurred in compliance with the Indenture (including Indebtedness of the Company
that refinances Indebtedness of any Restricted Subsidiary and Indebtedness of
any Restricted Subsidiary that refinances Indebtedness of another Restricted
Subsidiary, the Capital Stock of which is owned, directly or indirectly, by the
Restricted Subsidiary that is Incurring the Refinancing Indebtedness) including
Indebtedness that refinances Refinancing Indebtedness; provided, however, that
(i) the Refinancing Indebtedness has a Stated Maturity no earlier than the
earlier of (A) the first anniversary of the Stated Maturity of the Securities
and (B) Stated Maturity of the Indebtedness being refinanced, (ii) the
Refinancing Indebtedness has an Average Life at the time such Refinancing
Indebtedness is Incurred that is equal to or greater than the lesser of (A) the
Average Life of the Securities and (B) the Average Life of the Indebtedness
being refinanced and (iii) the Refinancing Indebtedness is in an aggregate
principal amount (or if issued with original issue discount, an aggregate issue
price) that is equal to (or 101% of, in the case of a refinancing of the
Securities in connection with a Change of Control) or less than the sum of the
aggregate principal amount (or if issued with original issue discount, the
accreted value) then outstanding of the Indebtedness being refinanced.
"Registrar" means United States Trust Company of New York, as
registrar under the Indenture, or any successor thereto appointed pursuant to
the Indenture.
"Registration Rights Agreement" means the Registration Rights
Agreement dated July 10, 1998 between the Company and the Initial Purchaser for
the benefit of themselves and the Securityholders, as the same may be amended or
modified from time to time in accordance with the terms thereof.
"Regulation S" means Regulation S under the Securities Act, or any
successor regulation.
"Regulation S Global Note" means a Regulation S Temporary Global Note
or a Regulation S Permanent Global Note, as appropriate.
"Regulation S Permanent Global Note" means a permanent global note
that contains the paragraph referred to in footnote 1 and the additional
schedule referred to in footnote 3 to the form of the Security attached as
Exhibit A-1, and that is deposited with and registered in the name of the
Depositary, representing a series of Securities sold in reliance on Regulation
S.
"Regulation S Temporary Global Note" means a single temporary global
note in the form of the Security attached hereto as Exhibit A-2 that is
deposited with and registered in the name of the Depositary, representing a
series of Securities sold in reliance on Regulation S.
21
"Replacement Satellite Indebtedness" means Indebtedness of the Company
or a Wholly Owned Subsidiary of the Company Incurred on or after January 1,
2002, to finance the acquisition of satellite broadcasting capacity, including
satellite transponders and/or capacity, transmitting facilities and/or capacity,
and related assets, whether secured or unsecured, and whether Incurred as
regular Indebtedness or as a Capitalized Lease Obligation.
"Reserve Account" shall have the meaning set forth in Section 11.01
hereof.
"Responsible Officer" when used with respect to the Trustee, means any
officer within the corporate trust department of the Trustee (or any successor
group of the Trustee) with direct responsibility for the administration of this
Indenture and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his or her
knowledge of and familiarity with the particular subject.
"Restricted Payment" has the meaning provided in Section 4.07(a).
"Restricted Period" means the 40-day restricted period as defined in
Regulation S.
"Restricted Security" has the meaning assigned to such term in Rule
144(a)(3) under the Securities Act.
"Restricted Subsidiary" means any Subsidiary of the Company other than
an Unrestricted Subsidiary.
"S&P" and "Standard and Poor's" means Standard & Poor's Rating Group.
"Sale/Leaseback Transaction" means an arrangement relating to property
now owned or hereafter acquired whereby the Company or a Restricted Subsidiary
transfers such property to a Person and the Company or a Subsidiary leases it
from such Person.
"Secured Indebtedness" means any Indebtedness of the Company secured
by a Lien.
"Securities" means the Initial Securities and the Exchange Securities
treated as a single class of securities, as amended or supplemented from time to
time in accordance with the terms hereof, that are issued pursuant to this
Indenture.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder, or any successor
statute or statutes thereto.
22
"Securityholder" or "Holder" means a registered holder of one or more
Securities.
"Senior Indebtedness" means, whether outstanding on the Issue Date or
thereafter issued, all Indebtedness of the Company or its Restricted
Subsidiaries, including interest and fees thereon; provided, however, that
Senior Indebtedness will not include any Subordinated Obligation of the Company
or any Restricted Subsidiary.
"Significant Subsidiary" means any Restricted Subsidiary that would be
a "Significant Subsidiary" of the Company within the meaning of Rule 1-02 under
Regulation S-X promulgated by the Commission.
"Stated Maturity" means, with respect to any Security, the date
specified in such Security as the fixed date on which the payment of principal
of such Security is due and payable, including pursuant to any mandatory
redemption provision.
"Subordinated Obligation" means any Indebtedness of the Company or a
Restricted Subsidiary (whether outstanding on the Issue Date or thereafter
Incurred) in respect of which, in the instrument creating or evidencing the same
or pursuant to which the same is outstanding, it is provided that the
obligations of the Company or such Restricted Subsidiary in respect of such
Indebtedness are subordinate or junior in right of payment to any other
Indebtedness of such Person of the type described in clause (i) or (ii) or (vii)
of the definition of "Indebtedness".
"Subsidiary" of any Person means any corporation, association or other
business entity of which such Person owns, directly or indirectly through one or
more Subsidiaries, a majority of the Capital Stock or other ownership interests
(including partnership and membership interests) and has ordinary voting power
to elect a majority of the directors, managers, trustees or other persons
performing similar functions or, in the case of a partnership, of which such
Person or any of its Subsidiaries is the general or managing general partner.
Notwithstanding the foregoing, Product Information Network Venture and
Superaudio shall be deemed to be Subsidiaries of the Company. Unless otherwise
specified herein, each reference to a Subsidiary shall refer to a Subsidiary of
the Company.
"Subsidiary Guarantee" means the Guarantee of the Securities by a
Subsidiary Guarantor.
"Subsidiary Guarantor" means each Restricted Subsidiary of the
Company, whether in existence on the Issue Date or created or acquired
thereafter (other than any foreign Subsidiary and other than any domestic
Restricted Subsidiary that is subject to a contractual limitation, existing on
the Issue Date, on its ability to issue a Subsidiary Guarantee which limitation
has not,
23
with the exercise of such Restricted Subsidiary's best efforts, been satisfied
or waived).
"Temporary Cash Investments" means any of the following: (i) any
Investment in direct obligations of the United States of America or any agency
thereof or obligations guaranteed by the United States of America or any agency
thereof, (ii) Investments in time deposit accounts, certificates of deposit and
money market deposits maturing within 180 days of the date of acquisition
thereof issued by a bank or trust company which is organized under the laws of
the United States of America, any state thereof or any foreign country
recognized by the United States of America having capital surplus and undivided
profits aggregating in excess of $250 million (or the foreign currency
equivalent thereof) and whose long-term debt, or whose parent holding company's
long-term debt, is rated "A" (or such similar equivalent rating) or higher by at
least one nationally recognized statistical rating organization (as defined in
Rule 436 under the Securities Act), (iii) repurchase obligations with a term of
not more than 30 days for underlying securities of the types described in clause
(i) above entered into with a bank meeting the qualifications described in
clause (ii) above, (iv) Investments in commercial paper, maturing not more than
180 days after the date of acquisition, issued by a corporation (other than an
Affiliate of the Company) organized and in existence under the laws of the
United States of America or any foreign country recognized by the United States
of America with a rating at the time as of which any investment therein is made
of "P-1" (or higher) according to Xxxxx'x or "A-1" (or higher) according to S&P,
(v) Investments in securities with maturities of six months or less from the
date of acquisition issued or fully guaranteed by any state, commonwealth or
territory of the United States of America, or by any political subdivision or
taxing authority thereof, and rated at least "A" by S&P or "A" by Xxxxx'x and
(vi) Investments in mutual funds whose investment guidelines restrict such
funds' investments to those satisfying the provisions of clauses (i) through (v)
above.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. (S)(S) 77aaa-
77bbbb) and the rules and regulations thereunder as in effect on the date on
which this Indenture is qualified under the TIA, except as provided in Section
9.03 hereof; provided, however, that, in the event the Trust Indenture Act of
1939 is amended after such date, "TIA" means, to the extent required by any such
amendment, the Trust Indenture Act of 1939 as so amended.
"Trustee" means U.S. Trust Company of New York, a banking corporation
organized and existing under the laws of the State of New York, until a
successor replaces it in accordance with Article 7 and thereafter means the
successor serving hereunder.
24
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company that
acquires an Affiliate Business, (ii) any other Subsidiary of the Company that at
the time of determination shall be designated an Unrestricted Subsidiary by the
Board of Directors in the manner provided below, (iii) any Subsidiary of an
Unrestricted Subsidiary, (iv) Product Information Network Venture; (v)
Superaudio; and (vi) Xxxxx/Capstar Radio Programming LLC. The Board of Directors
may designate any Subsidiary of the Company (including any newly acquired or
newly formed Subsidiary of the Company) to be an Unrestricted Subsidiary unless
such Subsidiary or any of its Subsidiaries owns any Capital Stock of the Company
or any Restricted Subsidiary of the Company that is not a Subsidiary of the
Subsidiary to be so designated; provided, however, that either (A) the
Subsidiary to be so designated has total consolidated assets of $10,000 or less
or (B) if such Subsidiary has consolidated assets greater than $10,000, then
such designation would be permitted under Section 4.07. The Board of Directors
may designate any Unrestricted Subsidiary to be a Restricted Subsidiary subject
to the limitations contained in Section 4.18.
"U.S. Government Obligations" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of the United States of America
is pledged and which are not callable or redeemable at the issuer's option.
"Wholly-Owned Subsidiary" means a Restricted Subsidiary of the
Company, at least 99% of the Capital Stock of which (other than directors'
qualifying shares) is owned by the Company or another Wholly-Owned Subsidiary.
SECTION 1.02. OTHER DEFINITIONS.
Defined in
Term Section
"actual knowledge"............................................ 7.02
"Affiliate Transaction"....................................... 4.11
"Agent Members"............................................... 2.16
"Asset Disposition Offer"..................................... 3.09
"Bankruptcy Law".............................................. 6.01
"covenant defeasance option".................................. 8.01
"Custodian"................................................... 6.01
"Declaration"................................................. 6.02
"Default Amount".............................................. 6.02
"Event of Default"............................................ 6.01
"Net Available Cash".......................................... 4.10
"judgment default provision".................................. 6.01
"legal defeasance option"..................................... 8.01
"Legal Holiday"............................................... 12.07
"Notice of Default"........................................... 6.01
"Offer Amount"................................................ 3.09
25
"Offer Period"................................................ 3.09
"Paying Agent"................................................ 2.03
"Registrar"................................................... 2.03
"Successor Company"........................................... 5.01
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 Securities and the Subsidiary
Guarantees;
"indenture security holder" means a Securityholder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee;
"obligor" on the Securities means the Company, the Subsidiary
Guarantors and any successor obligor upon the Securities.
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:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural, and in the plural
include the singular; and
(v) provisions apply to successive events and transactions.
ARTICLE 2
THE SECURITIES
26
SECTION 2.01. FORM AND DATING.
The Initial Securities and the Trustee's certificate of authentication
thereon shall be substantially in the form of Exhibit A-1 and A-2 hereto. The
-------------------
Exchange Securities and the Trustee's certificate of authentication thereon
shall be substantially in the form of Exhibit A-3 hereto. The Securities may
-----------
have notations, legends or endorsements required by law, stock exchange rule or
Depositary rule or usage. The Company and the Trustee shall approve the form of
the Securities and any notation, legend or endorsement on them. Each Security
shall be dated the date of its authentication.
The terms and provisions contained in the forms of the Securities,
annexed hereto as Exhibits A-1, A-2 and A-3, shall constitute, and are hereby
-------------------------
expressly made, a part of this Indenture and, to the extent applicable, 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.
(a) Global Notes.
------------
Securities offered and sold to QIBs in reliance on Rule 144A shall be
evidenced by one or more QIB Restricted Notes, deposited with the Trustee, as
custodian for the Depositary and registered in the name of the Depositary or a
nominee of the Depositary, duly executed by the Company and authenticated by the
Trustee as hereinafter provided. The aggregate principal amount of the QIB
Restricted Notes may from time to time be increased or decreased by adjustments
made on the records of the Trustee, as custodian for the Depositary or its
nominee, as hereinafter provided.
Securities offered and sold in offshore transactions in reliance on
Regulation S shall be issued initially in the form of a Regulation S Temporary
Global Note, deposited with the Trustee, as custodian for the Depositary and
registered in the name of the Depositary or the nominee of the Depositary for
the accounts of designated agents holding on behalf of Euroclear or Cedel, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided. The Restricted Period shall be terminated upon the receipt by the
Trustee of an Officers' Certificate from the Company which certificate shall be
delivered 40 days after the delivery of the authentication order of the
Regulation S Temporary Global Note. Following the termination of the Restricted
Period, beneficial interests in the Regulation S Temporary Global Note shall be
exchanged for beneficial interests in Regulation S Permanent Global Notes
pursuant to the Applicable Procedures. Simultaneously with the authentication
of Regulation S Permanent Global Notes, the Trustee shall cancel the Regulation
S Temporary Global Note. The aggregate principal amount of the Regulation S
Temporary Global Note and the Regulation S Permanent Global Notes may from time
to time be increased or decreased by
27
adjustments made on the records of the Trustee and the Depositary or its
nominee, as the case may be, in connection with transfers of interest as
hereinafter provided.
Each Global Note shall represent such of the outstanding Securities as
shall be specified therein and each shall provide that it shall represent the
aggregate amount of outstanding Securities from time to time endorsed thereon
and that the aggregate amount of outstanding Securities 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 amount of outstanding Securities 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 2.17 hereof.
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" and the "Management
Regulations" and "Instructions to Participants" of Cedel shall be applicable to
interests in the Regulation S Temporary Global Note and the Regulation S
Permanent Global Note that are held by the Agent Members through Euroclear or
Cedel.
Except as set forth in Sections 2.06 and 2.17 hereof, the Global Notes
may be transferred, in whole and not in part, only to another nominee of the
Depositary or to a successor of the Depositary or its nominee.
(b) Certificated Securities.
-----------------------
Securities issued in certificated form shall be substantially in the
form of Exhibit A-1 attached hereto (but without including the text referred to
in footnotes 1 and 3 thereto).
SECTION 2.02. EXECUTION AND AUTHENTICATION.
(a) Two Officers of the Company (each of whom shall, in each case,
have been duly authorized by all requisite corporate actions) shall sign the
Securities for the Company by manual or facsimile signature. If an Officer
whose signature is on a Security no longer holds that office at the time the
Security is authenticated, the Security shall nevertheless be valid.
(b) A Security shall not be valid until authenticated by the manual
signature of the Trustee. The signature of the Trustee shall be conclusive
evidence that the Security has been authenticated under this Indenture.
28
(c) The Trustee shall authenticate (i) Initial Securities for original
issue in the aggregate principal amount not to exceed $100,000,000, and (ii)
Exchange Securities from time to time for issue only in exchange for a like
principal amount of Initial Securities, in each case upon receipt of a written
order of the Company signed by two Officers.
(d) The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Securities. Unless limited by the terms of such
appointment, an authenticating agent may authenticate Securities 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 the Company or an Affiliate.
SECTION 2.03. REGISTRAR AND PAYING AGENT.
(a) The Company shall maintain an office or agency (which shall be
located in the Borough of Manhattan in the City of New York, State of New York)
where (i) Securities may be presented for registration of transfer or for
exchange ("Registrar"), (ii) Securities may be presented for payment ("Paying
Agent") and (iii) notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served. The Registrar shall keep a
register of the Securities and of their transfer and exchange. The Company may
appoint one or more co-Registrars and one or more additional Paying Agents. The
term "Paying Agent" includes any additional Paying Agent. The Company may
change any Paying Agent, Registrar or co-Registrar without prior notice to any
Securityholder. The Company shall notify the Trustee and the Trustee shall
notify the Securityholders of the name and address of any Agent not a party to
this Indenture. The Company or any Subsidiary Guarantor may act as Paying
Agent, Registrar or co-Registrar. The Company shall enter into an appropriate
agency agreement with any Agent not a party to this Indenture, which shall
incorporate the provisions of the TIA and implement the provisions of this
Indenture that relate to such Agent. The Company shall notify the Trustee of
the name and address of any such Agent. If the Company fails to appoint or
maintain a Registrar or Paying Agent, or fails to give the foregoing notice, the
Trustee shall act as such, and shall be entitled to appropriate compensation in
accordance with Section 7.07 hereof.
(b) The Company initially appoints the Trustee as Registrar, Paying
Agent and agent for service of notices and demands in connection with the
Securities.
The Company initially appoints The Depository Trust Company to act as
Depositary with respect to the Global Notes.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
29
The Company, the Subsidiary Guarantors and any other obligors on the
Securities 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 the
Securityholders and the Trustee all money held by the Paying Agent for the
payment of principal of, premium, if any, and interest on the Securities, and
shall notify the Trustee of any Default by the Company, any of the Subsidiary
Guarantors or any other obligor on the Securities 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, the Subsidiary Guarantors or
any other obligor on the Securities 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 Subsidiary Guarantor) shall have no
further liability for the money delivered to the Trustee. If the Company, the
Subsidiary Guarantors or any other obligor on the Securities acts as Paying
Agent, it shall segregate and hold in a separate trust fund for the benefit of
the Securityholders all money held by it as Paying Agent.
SECTION 2.05. SECURITYHOLDER 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
Securityholders and shall otherwise comply with TIA (S) 312(a). If the Trustee
is not the Registrar, the Company, the Subsidiary Guarantors or any other
obligor on the Securities 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 Securityholders, including
the aggregate principal amount of the Securities held by each thereof, and the
Company, the Subsidiary Guarantors and each other obligor on the Securities
shall otherwise comply with TIA (S) 312(a).
SECTION 2.06. TRANSFER AND EXCHANGE.
(a) Where Securities are presented to the Registrar or a co-registrar
with a request to register the transfer thereof or exchange them for an equal
principal amount of Securities of other denominations, the Registrar shall
register the transfer or make the exchange if its requirements for such
transactions are met; provided, that any Security presented or surrendered for
registration of transfer or exchange shall be duly endorsed or accompanied by a
written instruction of transfer in form satisfactory to the Registrar and the
Trustee duly executed by the Securityholder thereof or his attorney duly
authorized in writing.
(b) To permit registrations of transfers and exchanges, the Company
shall execute and the Trustee shall
30
authenticate Certificated Notes and Global Notes at the Registrar's request.
(c) No service charge shall be made to a Holder 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 2.10, 3.06 and 9.05
hereof).
(d) The Registrar shall not be required to register the transfer of
or exchange any Security selected for redemption in whole or in part, except the
unredeemed portion of any Security being redeemed in part.
(e) All Certificated Notes and Global Notes issued upon any
registration of transfer or exchange of Certificated Notes or Global Notes shall
be the valid obligations of the Company, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Certificated Notes or Global
Notes surrendered upon such registration of transfer or exchange.
(f) The Company shall not be required:
(i) to issue, to register the transfer of or to exchange any
Security during a period beginning at the opening of business 15 days
before the day of any selection of Securities for redemption under Section
3.02 hereof and ending at the close of business on the day of selection; or
(ii) to register the transfer of or to exchange any Security so
selected for redemption in whole or in part, except the unredeemed portion
of any Security being redeemed in part; or
(iii) to register the transfer of or to exchange a Security
between a Record Date and the next succeeding Interest Payment Date, or
between a special record date for payment of defaulted interest and the
related payment date.
(g) Prior to due presentment of the registration of a transfer of any
Security, the Trustee, any Agent and the Company may deem and treat the Person
in whose name any Security is registered as the absolute owner of such Security
for the purpose of all payments with respect to such Securities, and neither the
Trustee, any Agent nor the Company shall be affected by notice to the contrary.
(h) The Trustee shall authenticate Certificated Notes and Global
Notes in accordance with the provisions of Section 2.2 hereof.
31
(i) Any Holder of the Global Notes shall, by acceptance of such
Global Notes, agree that transfers of beneficial interests in such Global Notes
may be effected only through a book entry system maintained by the Holder of
such Global Notes (or its agent), and that ownership of a beneficial interest in
the Global Notes shall be required to be reflected in a book entry.
(j) Upon the registration of the transfer, exchange or replacement of
Securities not bearing the Private Placement Legend, the Registrar shall deliver
Securities that do not bear the Private Placement Legend. Upon the registration
of the transfer, exchange or replacement of Securities bearing the Private
Placement Legend, the Registrar shall deliver only Securities that bear the
Private Placement Legend unless there is delivered to the Registrar an Opinion
of Counsel reasonably satisfactory to the Company and the Trustee to the effect
that neither such legend nor the related restrictions on transfer are required
in order to maintain compliance with the provisions of the Securities Act.
(k) By its acceptance of any Security bearing the Private Placement
Legend, each Holder of such a Security acknowledges the restrictions on transfer
of such Security set forth in this Indenture and in the Private Placement Legend
and agrees that it will transfer such Security only as provided in this
Indenture.
The Registrar shall retain for at least two years copies of all
letters, notices and other written communications received pursuant to Section
2.17. The Company shall have the right to inspect and make copies of all such
letters, notices or other written communications at any reasonable time upon the
giving of reasonable written notice to the Registrar.
SECTION 2.07. REPLACEMENT SECURITIES.
(a) If any mutilated Security is surrendered to the Trustee, or the
Company and the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Security, the Company shall issue and the
Trustee, upon receipt by it of the written order of the Company signed by two
Officers of the Company, shall authenticate a replacement Security if the
Trustee's requirements for replacements of Securities 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 Subsidiary Guarantors, the Trustee, any Agent or any authenticating
agent from any loss which any of them may suffer if a Security is replaced. The
Company and the Trustee may charge a Securityholder for reasonable out-of-pocket
expenses in replacing a Security.
32
(b) Every replacement Security is an obligation of the Company and
each of the Subsidiary Guarantors.
SECTION 2.08. OUTSTANDING SECURITIES.
(a) The Securities outstanding at any time are all the Securities
authenticated by the Trustee except for those canceled by the Trustee, those
delivered to the Trustee for cancellation and those described in this Section as
not outstanding.
(b) If a Security is replaced pursuant to Section 2.07 hereof, it
ceases to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced Security is held by a protected purchaser.
(c) If the principal amount of any Security is considered paid under
Section 4.01 hereof, it ceases to be outstanding and interest on it ceases to
accrue.
(d) Subject to Section 2.09 hereof, a Security does not cease to be
outstanding because the Company or an Affiliate of the Company holds the
Security.
SECTION 2.09. TREASURY SECURITIES.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company, the Subsidiary Guarantors, or any of their respective Affiliates
shall be considered as though not outstanding, except that for purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Securities which a Responsible Officer of the
Trustee has actual knowledge are so owned shall be so disregarded.
SECTION 2.10. TEMPORARY SECURITIES.
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities upon written
order of the Company signed by two Officers of the Company. Temporary
Securities shall be substantially in the form of definitive Securities but may
have variations that the Company and the Subsidiary Guarantors consider
appropriate for temporary Securities. Without unreasonable delay, the Company
shall prepare and the Trustee, upon receipt of the written order of the Company
signed by two Officers of the Company, shall authenticate definitive Securities
in exchange for temporary Securities. Until such exchange, temporary Securities
shall be entitled to the same rights, benefits and privileges as definitive
Securities.
SECTION 2.11. CANCELLATION.
33
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Securities surrendered to them for registration of transfer, exchange or
payment. The Trustee (or its Agent) shall cancel all Securities, if not already
canceled, surrendered for registration of transfer, exchange, payment,
replacement or cancellation and shall destroy canceled Securities (subject to
the record retention requirement of the Exchange Act), and deliver certification
of their destruction to the Company, unless by a written order, signed by two
Officers of the Company, the Company shall direct that canceled Securities be
returned to it. The Company may not issue new Securities to replace Securities
that it has redeemed or paid or that have been delivered to the Trustee for
cancellation. If the Company acquires any of the Securities, such acquisition
shall not operate as a redemption or satisfaction of the indebtedness
represented by such Securities unless or until the same are surrendered to the
Trustee (or its agent) for cancellation pursuant to this Section.
SECTION 2.12. DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Securities, 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
Securityholders on a subsequent special record date, which date shall be at the
earliest practicable date but in all events at least five Business Days prior to
the payment date, in each case at the rate provided in the Securities and in
Section 4.01 hereof. The Company shall, with the consent of the Trustee, fix or
cause to be fixed each such special record date and payment 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 of and at the expense of the Company)
shall mail to Securityholders a notice that states the special record date, the
related payment date and the amount of such interest to be paid.
SECTION 2.13. CUSIP NUMBERS.
The Company in issuing the Securities may use one or more "CUSIP"
numbers, and if so, the Trustee shall use the CUSIP numbers in notices of
redemption or exchange as a convenience to Securityholders; provided that no
representation shall be deemed to be made by the Trustee as to the correctness
or accuracy of the CUSIP number printed in the notice or on the Securities, and
that reliance may be placed only on the other identification numbers printed on
the Securities. The Company shall promptly notify the Trustee of any change in
the CUSIP numbers.
SECTION 2.14. DEPOSIT OF MONEYS.
Prior to 11:00 a.m. New York City time on each Interest Payment Date
and Maturity Date, the Company shall have deposited
34
with the Paying Agent in immediately available funds money sufficient, together
with any amounts to be disbursed pursuant to Section 11.04(a), to make cash
payments, if any, due on such Interest Payment Date or Maturity Date, as the
case may be, in a timely manner which permits the Paying Agent to remit payment
to the Securityholders on such Interest Payment Date or Maturity Date, as the
case may be.
SECTION 2.15. RESTRICTIVE LEGENDS.
Each Global Note and each Certificated Note that constitutes a
Restricted Security shall bear the following legend (the "Private Placement
Legend") unless otherwise agreed by the Company and the Securityholder thereof
or unless another legend is required as a result of changes in applicable
securities laws:
THIS NOTE OR ITS PREDECESSORS HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND ACCORDINGLY,
NEITHER THIS NOTE NOR A BENEFICIAL INTEREST HEREIN MAY BE OFFERED, SOLD OR
PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE
ACCOUNT OR BENEFIT OF, UNITED STATES PERSONS EXCEPT AS SET FORTH IN THE
FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS
THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON, IS NOT ACQUIRING
THIS NOTE FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON AND IS ACQUIRING THIS
NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE
SECURITIES ACT, (2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD
REFERRED TO IN RULE 144(k) UNDER THE SECURITIES ACT AS IN EFFECT WITH
RESPECT TO SUCH TRANSFER, RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A)
TO XXXXX INTERNATIONAL NETWORKS, LTD. OR ANY SUBSIDIARY THEREOF, (B) INSIDE
THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH
RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN
INSTITUTIONAL ACCREDITED INVESTOR (AS DEFINED IN RULE 501 (a)(1),(2),(3) OR
(7) UNDER THE SECURITIES ACT) THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO
THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS NOTE (THE FORM
OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), AND IF SUCH TRANSFER IS
IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES AT THE TIME OF
TRANSFER OF LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO XXXXX
INTERNATIONAL NETWORKS, LTD. THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT, (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT
(IF AVAILABLE), (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OR (G) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (BASED UPON AN OPINION OF
COUNSEL ACCEPTABLE
35
TO XXXXX INTERNATIONAL NETWORKS, LTD.) AND, IN EACH CASE, IN ACCORDANCE
WITH APPLICABLE SECURITIES LAWS AND (3) AGREES THAT IT WILL DELIVER TO EACH
PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION,"
"UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY RULE
902 OF REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A
PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS
NOTE IN VIOLATION OF THE FOREGOING RESTRICTIONS.
Each Global Note shall also bear the following legend on the face
thereof:
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN
DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY, OR BY ANY SUCH NOMINEE OF THE
DEPOSITARY TO ANY OTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR
ANY NOMINEE OF THE DEPOSITARY TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF
SUCH SUCCESSOR DEPOSITARY. TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED
TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN THE INDENTURE.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
SECTION 2.16. BOOK-ENTRY PROVISIONS FOR GLOBAL SECURITY.
(a) The Global Notes initially shall (i) be registered in the name of
the Depositary or the nominee of such Depositary, (ii) be delivered to the
Trustee as custodian for such Depositary and (iii) bear legends as set forth in
Section 2.15. Members of, or participants in, the Depositary ("Agent Members")
shall have no rights under this Indenture with respect to any Global Notes held
on their behalf by the Depositary, or the Trustee as its custodian, or under the
Global Notes, and the Depositary may be treated by the Company, the Trustee and
any agent of the Company or the Trustee as the absolute owner of the Global
Notes for all purposes whatsoever. Notwithstanding the foregoing, nothing
36
herein shall prevent the Company, the Trustee or any agent of the Company or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or impair, as between the Depositary
and its Agent Members, the operation of customary practices governing the
exercise of the rights of a Holder of any Note.
(b) The Holder of the Global Notes may grant proxies and otherwise
authorize any Person, including Agent Members and Persons that may hold
interests through Agent Members, to take any action which a Securityholder is
entitled to take under this Indenture or the Securities.
SECTION 2.17. SPECIAL TRANSFER PROVISIONS.
(a) Transfer and Exchange of Global Notes. The transfer and exchange
-------------------------------------
of Global Notes or beneficial interests therein shall be effected through the
Depositary, in accordance with this Indenture and the procedures of the
Depositary therefor, which shall include restrictions on transfer comparable to
those set forth herein to the extent required by the Securities Act. Beneficial
interests in a Global Notes may be transferred to Persons who take delivery
thereof in the form of a beneficial interest in the same Global Notes in
accordance with the transfer restrictions set forth in the legend in Section
2.15. Transfers of beneficial interests in the Global Notes to Persons required
to take delivery thereof in the form of an interest in another Global Notes
shall be permitted as follows:
(i) QIB Restricted Note to Regulation S Global Note. If, at any
-----------------------------------------------
time, an owner of a beneficial interest in a QIB Restricted Note deposited
with the Depositary (or the Trustee as custodian for the Depositary) wishes
to transfer its interest in such QIB Restricted Note to a Person who is
required or permitted to take delivery thereof in the form of an interest
in a Regulation S Global Note, such owner shall, subject to the Applicable
Procedures, exchange or cause the exchange of such interest for an
equivalent beneficial interest in a Regulation S Global Note as provided in
this Section 2.17(a)(i). Upon receipt by the Trustee of (1) instructions
given in accordance with the Applicable Procedures from an Agent Member
directing the Trustee to credit or cause to be credited a beneficial
interest in the Regulation S Global Note in an amount equal to the
beneficial interest in the QIB Restricted Note to be exchanged, (2) a
written order given in accordance with the Applicable Procedures containing
information regarding the participant account of the Depositary and, if
applicable, the Euroclear or Cedel account to be credited with such
increase, (3) a certificate in the form of Exhibit B-1 hereto given by the
-----------
owner of such beneficial interest stating that the transfer of such
interest has been made in compliance with the transfer restrictions
applicable to the Global Notes and pursuant to and in accordance with Rule
903
37
or Rule 904 of Regulation S, and (4) if such transfer is in respect of an
aggregate principal amount of Securities at the time of transfer of less
than $250,000, an opinion of counsel acceptable to the Company that such
transfer is in compliance with the Securities Act, then the Trustee, as
Registrar, shall instruct the Depositary to reduce or cause to be reduced
the aggregate principal amount of the applicable QIB Restricted Note and to
increase or cause to be increased the aggregate principal amount of the
applicable Regulation S Global Note by the principal amount of the
beneficial interest in the QIB Restricted Note to be exchanged, to credit
or cause to be credited to the account of the Person specified in such
instructions a beneficial interest in the Regulation S Global Note equal to
the reduction in the aggregate principal amount of the QIB Restricted Note,
and to debit, or cause to be debited, from the account of the Person making
such exchange or transfer the beneficial interest in the QIB Restricted
Note that is being exchanged or transferred.
(ii) Regulation S Global Note to QIB Restricted Note. If, at any
-----------------------------------------------
time, an owner of a beneficial interest in a Regulation S Global Note
deposited with the Depositary or with the Trustee as custodian for the
Depositary wishes to transfer its interest in such Regulation S Global Note
to a Person who is required or permitted to take delivery thereof in the
form of an interest in a QIB Restricted Note, such owner shall, subject to
the Applicable Procedures, exchange or cause the exchange of such interest
for an equivalent beneficial interest in a QIB Restricted Note as provided
in this Section 2.17(a)(ii). Upon receipt by the Trustee of (1)
instructions from Euroclear or Cedel, if applicable, and the Depositary,
directing the Trustee, as Registrar, to credit or cause to be credited a
beneficial interest in the QIB Restricted Note equal to the beneficial
interest in the Regulation S Global Note to be exchanged, such instructions
to contain information regarding the participant account with the
Depositary to be credited with such increase, (2) a written order given in
accordance with the Applicable Procedures containing information regarding
the participant account of the Depositary and (3) a certificate in the form
of Exhibit B-2 attached hereto given by the owner of such beneficial
-----------
interest stating (A) if the transfer is pursuant to Rule 144A, that the
Person transferring such interest in a Regulation S Global Note reasonably
believes that the Person acquiring such interest in a QIB Restricted Note
is a QIB and is obtaining such beneficial interest in a transaction meeting
the requirements of Rule 144A and any applicable blue sky or securities
laws of any state of the United States, (B) that the transfer complies with
the requirements of Rule 144 under the Securities Act and any applicable
blue sky or securities laws of any state of the United States or (C) if the
transfer is pursuant to any other exemption from the registration
requirements of the
38
Securities Act, that the transfer of such interest has been made in
compliance with the transfer restrictions applicable to the Global Notes
and pursuant to and in accordance with the requirements of the exemption
claimed, such certificate to be supported by an Opinion of Counsel from the
transferee or the transferor reasonably acceptable to the Company, then the
Trustee, as Registrar, shall instruct the Depositary to reduce or cause to
be reduced the aggregate principal amount of the applicable Regulation S
Global Note and to increase or cause to be increased the aggregate
principal amount of the applicable QIB Restricted Note by the principal
amount of the beneficial interest in the Regulation S Global Note to be
exchanged, and the Trustee, as Registrar, shall instruct the Depositary,
concurrently with such reduction, to credit or cause to be credited to the
account of the Person specified in such instructions a beneficial interest
in the applicable QIB Restricted Note equal to the reduction in the
aggregate principal amount of such Regulation S Global Note and to debit or
cause to be debited from the account of the Person making such transfer the
beneficial interest in the Regulation S Global Note that is being
transferred.
(b) Transfer and Exchange of Certificated Notes. When Certificated
-------------------------------------------
Notes are presented by a Holder to the Registrar with a request:
(i) to register the transfer of the Certificated Notes; or
(ii) to exchange such Certificated Notes for an equal principal
amount of Certificated Notes of other authorized denominations,
the Registrar shall register the transfer or make the exchange as
requested; provided, however, that the Certificated Notes presented or
surrendered for register of transfer or exchange:
(i) shall be duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly executed
by such Xxxxxx or by his attorney, duly authorized in writing; and
(ii) in the case of a Certificated Note that contains the legend
provided in Section 2.15, such request shall be accompanied by the
following additional information and documents, as applicable:
(x) if such Security is being delivered to the Registrar by
a Holder for registration in the name of such Holder, without
transfer, or such Security is being transferred to the Company, a
certification to
39
that effect from such Holder (in substantially the form of Exhibit B-3
-----------
hereto);
(y) if such Security is being transferred to a QIB in
accordance with Rule 144A under the Securities Act or pursuant to an
exemption from registration in accordance with Rule 144 under the
Securities Act or pursuant to an effective registration statement
under the Securities Act, a certification to that effect from such
Holder (in substantially the form of Exhibit B-3 hereto) and an
------------
Opinion of Counsel from such Holder or the transferee reasonably
acceptable to the Company to the effect that such transfer is in
compliance with the Securities Act; or
(z) if such Security is being transferred in reliance on any
other exemption from the registration requirements of the Securities
Act, a certification to that effect from such Holder (in substantially
the form of Exhibit B-3 hereto) and an Opinion of Counsel from such
-----------
Holder or the transferee reasonably acceptable to the Company to the
effect that such transfer is in compliance with the Securities Act.
(c) Exchange of a Beneficial Interest in a QIB Restricted Note or
--------------------------------------- ------------------
Regulation S Permanent Global Note for a Certificated Note.
----------------------------------------------------------
(i) Any Person having a beneficial interest in a QIB Restricted
Note or a Regulation S Permanent Global Note may upon request, subject to
the Applicable Procedures, exchange such beneficial interest for a
Certificated Note registered in the name of such Person. Upon receipt by
the Trustee of written instructions or such other form of instructions as
is customary for the Depositary (or Euroclear or Cedel, if applicable),
from the Depositary or its nominee on behalf of any Person having a
beneficial interest in a QIB Restricted Note or Regulation S Permanent
Global Note, and a certification (which may be submitted by facsimile) to
the effect that such beneficial interest is being transferred to the same
Person designated by the Depositary as having the beneficial interest in
the portion of the QIB Restricted Note or Regulation S Permanent Global
Note being exchanged (in substantially the form of Exhibit B-4 hereto); in
-----------
which case the Trustee or the Note Custodian, at the direction of the
Trustee, shall, in accordance with the standing instructions and procedures
existing between the Depositary and the Note Custodian, cause the aggregate
principal amount of QIB Restricted Notes or Regulation S Permanent Global
Notes, as applicable, to be reduced accordingly and, following such
reduction, the Company shall execute and the Trustee shall authenticate and
deliver to the Person requesting such exchange a Certificated Note in the
appropriate principal amount.
40
(ii) Subject to the provisions of Section 2.17(c)(i),
Certificated Notes issued in exchange for a beneficial interest in a QIB
Restricted Note or Regulation S Permanent Global Note, as applicable,
pursuant to this Section 2.17(c) shall be registered in such names and in
such authorized denominations as the Depositary, pursuant to instructions
from its direct or indirect participants or otherwise, shall instruct the
Trustee. The Trustee shall deliver such Certificated Notes to the Persons
in whose names such Securities are so registered. Following any such
issuance of Certificated Notes, the Trustee, as Registrar, shall instruct
the Depositary to reduce or cause to be reduced the aggregate principal
amount of the applicable Global Note to reflect the transfer.
(d) Restrictions on Transfer and Exchange of Global Notes.
-----------------------------------------------------
Notwithstanding any other provision of this Indenture (other than the provisions
set forth in this Section 2.17(d)), a Global Note may not be transferred as a
whole except by the Depositary to a nominee of the Depositary or by a nominee of
the Depositary to the Depositary or another nominee of the Depositary or by the
Depositary or any such nominee to a successor Depositary or a nominee of such
successor Depositary.
(e) Transfer and Exchange of a Certificated Note for a Beneficial
-------------------------------------------------------------
Interest in a Global Note. A Certificated Note may not be transferred or
-------------------------
exchanged for a beneficial interest in a Global Note.
(f) Authentication of Certificated Notes in Absence of Depositary. If
-------------------------------------------------------------
at any time:
(i) the Depositary for the Securities notifies the Company that
the Depositary is unwilling or unable to continue as Depositary for the
Global Notes and a successor Depositary for the Global Notes is not
appointed by the Company within 90 days after delivery of such notice; or
(ii) the Company, at its sole discretion, notifies the Trustee in
writing that it elects to cause the issuance of Certificated Notes under
this Indenture, then the Company shall execute, and the Trustee shall, upon
receipt of an authentication order in accordance with Section 2.02 hereof,
authenticate and deliver, Certificated Notes registered in such names and
principal amounts as specified by the Depositary in an aggregate principal
amount equal to the principal amount of the Global Notes in exchange for
such Global Notes.
(g) Cancellation or Adjustment of Global Notes. At such time as all
------------------------------------------
beneficial interests in Global Notes have been exchanged for Certificated Notes,
redeemed, repurchased or canceled, all Global Notes shall be returned to or
retained and canceled by the Trustee in accordance with Section 2.11 hereof.
41
At any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for Certificated Notes, redeemed, repurchased or canceled, the
principal amount of Notes represented by such Global Notes shall be reduced
accordingly and an endorsement shall be made on such Global Notes by the Trustee
or the Note Custodian, at the direction of the Trustee, to reflect such
reduction.
SECTION 2.18. PERSONS DEEMED OWNERS.
Prior to due presentment of a Security for registration of transfer
and subject to Section 2.12, the Company, the Trustee, any Paying Agent, any
Registrar and any co-Registrar and agent of the foregoing may deem and treat the
Person in whose name any Security shall be registered upon the register of
Securities kept by the Registrar as the absolute owner of such Security (whether
or not such Security shall be overdue and notwithstanding any notation of the
ownership or other writing thereon made by anyone other than the Company, any
Registrar or any co-Registrar) for the purpose of receiving payments due on such
Security and for all other purposes; and none of the Company, the Trustee, any
Paying Agent, any Registrar or any co-Registrar or any Agent of the foregoing
shall be affected by any notice to the contrary.
SECTION 2.19. RECORD DATE.
The record date for purposes of determining the identity of
Securityholders entitled to vote or consent to any action by vote or consent
authorized or permitted under this Indenture shall be the later of (i) 30 days
prior to the first solicitation of such consent or (ii) the date of the most
recent list of Holders furnished to the Trustee, if applicable, pursuant to
Section 2.05 hereto.
ARTICLE 3
REDEMPTION
SECTION 3.01. NOTICES TO TRUSTEE.
(a) If the Company elects to redeem Securities pursuant to the
optional redemption provisions of Section 3.07 hereof, it shall furnish to the
Trustee, at least 30 days (unless a shorter period is acceptable to the Trustee)
but not more than 60 days before a redemption date, an Officers' Certificate
setting forth (i) the Section of this Indenture pursuant to which the redemption
shall occur, (ii) the redemption date, (iii) the principal amount of Securities
to be redeemed, (iv) the redemption price and accrued and unpaid interest and
(v) whether it requests the Trustee to give notice of such redemption.
(b) If the Company elects or is required to make an offer to purchase
Securities pursuant to the provisions of
42
Sections 3.09, 4.10 or 4.14 hereof, it shall furnish to the Trustee at least 30
days but not more than 60 days before a repurchase date, an Officers'
Certificate setting forth (i) the Section of this Indenture pursuant to which
the repurchase shall occur, (ii) the repurchase date, (iii) the maximum
principal amount of Securities to be repurchased, (iv) the repurchase price and
accrued and unpaid interest, (v) whether it requests the Trustee to give notice
of such offer to repurchase and (vi) further setting forth a statement to the
effect that (a) the Company or one of its Subsidiaries has effected an Asset
Disposition and the conditions set forth in Section 4.10 have been satisfied or
(b) a Change of Control has occurred and the conditions set forth in Section
4.14 have been satisfied, as applicable.
SECTION 3.02. SELECTION OF SECURITIES TO BE REDEEMED.
(a) If less than all of the Securities are to be redeemed, the Trustee
shall select the Securities to be redeemed among the Securityholders on a pro
rata basis, by lot or by such other method as the Trustee in its sole discretion
shall deem fair and appropriate; provided, however, that if a partial redemption
is made with the proceeds of an Equity Offering, selection of the Securities or
portions thereof to be redeemed shall be made by the Trustee only on a pro rata
basis, unless such method is otherwise prohibited. In the event of partial
redemption by lot, the particular Securities 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 Securities not
previously called for redemption.
(b) The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption and, in the case of any Security selected for
partial redemption, the principal amount thereof to be redeemed. Securities may
be redeemed in part in multiples of $1,000 principal amount only. Except as
provided in the preceding sentence, provisions of this Indenture that apply to
Securities called for redemption also apply to portions of Securities called for
redemption.
(c) In the event the Company elects or is required to make an offer to
repurchase Securities pursuant to Sections 3.09 hereof and the amount of the
Excess Proceeds from the Asset Disposition are not evenly divisible by $1,000,
the Trustee shall promptly refund to the Company any remaining Excess Proceeds.
SECTION 3.03. NOTICE OF REDEMPTION.
(a) At least 30 days (unless a shorter period is acceptable to the
Trustee) but not more than 60 days before a redemption date, the Company shall
mail or cause to be mailed a notice of redemption by first class mail, postage
prepaid to each
43
Holder whose Securities are to be redeemed at the last address for such Xxxxxx
then shown on the registry books.
The notice shall identify the Securities to be redeemed and shall
state:
(i) the redemption date;
(ii) the redemption price;
(iii) if any Security is being redeemed in part, the portion of
the principal amount of such Security to be redeemed and that, after
the redemption date upon surrender of such Security, a new Security or
Securities in principal amount equal to the unredeemed portion shall
be issued;
(iv) the name and address of the Paying Agent;
(v) that Securities called for redemption must be surrendered
to the Paying Agent to collect the redemption price;
(vi) that, unless the Company defaults in making such
redemption payment, interest on Securities called for redemption
ceases to accrue on and after the redemption date;
(vii) the paragraph of the Securities and/or Section of this
Indenture pursuant to which the Securities called for redemption are
being redeemed; and
(viii) if fewer than all the Securities are to be redeemed, the
identification of the particular Securities (or portions thereof) to
be redeemed, as well as the aggregate principal amount of Securities
to be redeemed and the aggregate principal amount of Securities to be
outstanding after such partial redemption.
(b) At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense; provided,
however, that the Company shall have delivered to the Trustee at least 45 days
(unless a shorter period is acceptable to the Trustee) prior to the proposed
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, Securities called for redemption become due
44
and payable on the redemption date at the redemption price plus accrued and
unpaid interest, if any.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE.
(a) Prior to 11:00 a.m., New York City time, on the redemption date,
the Company shall deposit with the Paying Agent (other than the Company or any
of its Subsidiaries) money sufficient to pay the redemption price of and accrued
interest on all Securities to be redeemed on that date. The Paying Agent shall
promptly return to the Company any money deposited with the Paying Agent by the
Company in excess of the amounts necessary to pay the redemption price of, and
accrued interest on, all Securities to be redeemed.
(b) If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest ceases to accrue on the
Securities or the portions of Securities called for redemption whether or not
such Securities are presented for payment, and the only remaining right of the
Holders of such Securities shall be to receive payment of the redemption price
upon surrender to the Paying Agent of the Securities to be redeemed. If a
Security is redeemed on or after an Interest 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 Security was registered at the close of
business on such record date. If any Security called for redemption shall not
be so paid upon surrender for redemption because of the failure of the Company
to comply with paragraph (a) above, 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 not paid on such unpaid principal, in each case
at the rate provided in the Securities and in Section 4.01 hereof.
SECTION 3.06. SECURITIES REDEEMED IN PART.
Upon surrender of a Security that is redeemed in part, the Company
shall issue and upon the Company's written request, the Trustee shall
authenticate for the Securityholder at the expense of the Company a new Security
equal in principal amount to the unredeemed portion of the Security surrendered.
SECTION 3.07. OPTIONAL REDEMPTION.
(a) Except as provided in Section 3.07(b), the Company may redeem all
or any portion of the Securities at any time on or after July 1, 2003, at a
redemption price equal to a percentage of the principal amount thereof, as set
forth in the immediately succeeding sentence, plus accrued and unpaid interest
to the redemption date. The redemption price as a percentage of the principal
amount shall be as follows, if the Securities are redeemed during the 12-month
period commencing on July 1 of the years set forth below, plus in each case,
accrued and unpaid
45
interest to the date of redemption (subject in the case of redemptions occurring
after a record date and on or prior to the succeeding interest payment date to
the right of holders of record on the relevant record date to receive interest
due on the relevant Interest Payment Date):
Period Redemption Price
------ ----------------
2003 105.875%
2004 and thereafter 100.000%
(b) At any time, or from time to time, on or prior to July 1, 2001,
the Company may, at its option, use the Net Cash Proceeds of one or more Equity
Offerings by the Company to redeem up to 35% of the originally issued aggregate
principal amount of the Securities at a redemption price equal to 111.75% of the
principal amount thereof, plus accrued and unpaid interest thereon, if any, to
the date of redemption; provided, however, that after any such redemption the
aggregate principal amount of the Securities outstanding must equal at least 65%
of the aggregate principal amount of Securities issued hereunder; and, provided,
further, that the Company may not so redeem the Securities in connection with a
Change of Control. In order to effect the foregoing redemption with the
proceeds of any Equity Offering, the Company shall make such redemption not more
than 90 days after the consummation of any such Equity Offering.
SECTION 3.08. MANDATORY REDEMPTION.
The Company is not required to make mandatory redemption or sinking
fund payments with respect to the Securities, but is required to make an offer
to repurchase the Securities in connection with a Change of Control as provided
under Section 4.14 and, under certain circumstances, following certain asset
sales as provided under Section 4.10.
SECTION 3.09. OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS.
In the event that, pursuant to Section 4.10 hereof, the Company shall
commence an offer to all Securityholders to purchase Securities (an "Asset
Disposition Offer"), it shall follow the procedures specified below:
(a) The Asset Disposition Offer shall remain open for a period of 30
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 Securities
required to be purchased pursuant to Section 4.10 hereof (the "Offer Amount")
or, if less than the Offer Amount has been tendered, all Securities tendered in
response to the Asset Disposition Offer.
46
(b) If the Purchase Date is on or after a Record Date and on or before
the related Interest Payment Date, any accrued interest shall be paid to the
Person in whose name a Security is registered at the close of business on such
Record Date, and no additional interest shall be payable to holders who tender
Securities pursuant to the Asset Disposition Offer.
(c) Upon the commencement of any Asset Disposition Offer, the Company
shall send or cause to be sent in accordance with Section 3.03, a notice to each
Securityholder. The notice shall contain all instructions and materials
necessary to enable such holders to tender Securities pursuant to the Asset
Disposition Offer. The notice, which shall govern the terms of the Asset
Disposition Offer, shall state:
(i) that the Asset Disposition Offer is being made pursuant to
this Section 3.09 and Section 4.10 hereof and the length of time the
Asset Disposition Offer shall remain open;
(ii) the Offer Amount, the purchase price and the Purchase Date;
(iii) that any Security not tendered or accepted for payment shall
continue to accrue interest;
(iv) that any Security accepted for payment pursuant to the Asset
Disposition Offer shall cease to accrue interest after the Purchase
Date;
(v) that Holders electing to have a Security purchased pursuant
to any Asset Disposition Offer shall be required to surrender the
Security, with the form entitled "Option of Securityholder to Elect
Purchase" on the reverse of the Security completed, 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;
(vi) that Holders shall be entitled to withdraw their election if
the Company, depositary or 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 Security the Holder delivered for purchase
and a statement that such Xxxxxx is withdrawing his or her election to
have the Security purchased;
(vii) that, if the aggregate principal amount of Securities
surrendered by Holders exceeds the Offer Amount, the Company shall
select the Securities to be purchased on a pro rata basis (with such
adjustments as may be deemed appropriate by the Company so that only
47
Securities in denominations of $1,000, or integral multiples thereof,
shall be purchased); and
(viii) that Holders whose Securities were purchased only in part
shall be issued new Securities equal in principal amount to the
unpurchased portion of the Securities surrendered.
(d) On or before the Purchase Date, the Company shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, the
Offer Amount of Securities or portions thereof tendered pursuant to the Asset
Disposition Offer or, if less than the Offer Amount has been tendered, all
Securities or portions thereof tendered, and deliver to the Trustee an Officers'
Certificate stating that such Securities or portions thereof were accepted for
payment by the Company in accordance with the terms of this Section 3.09. The
Paying Agent 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 Security or Securities tendered by such Holder and
accepted by the Company for purchase, and the Company shall promptly issue a new
Security, and at the written request of the Company the Trustee shall
authenticate and mail or deliver such new Security to such Holder equal in
principal amount to any unpurchased portion of the Security surrendered. Any
Security 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
Asset Disposition Offer on the Purchase Date.
ARTICLE 4
COVENANTS
SECTION 4.01. PAYMENT OF SECURITIES.
(a) The Company shall pay the principal or repurchase price of,
premium, if any, and interest on the Securities on the dates and in the manner
provided in the Securities and in this Indenture. Principal or repurchase
price, premium, if any, and interest shall be considered paid on the date due if
the Paying Agent, if other than the Company or a Subsidiary, holds as of 11:00
a.m. New York City time on the due date money deposited by the Company in
immediately available funds and designated for and sufficient to pay all
principal or repurchase price, premium, if any, and interest then due. Such
Paying Agent shall return to the Company, no later than five business days
following the date of payment, any money (including accrued interest paid by the
Company) that exceeds such amount of principal or repurchase price, premium, if
any, and interest paid on the Securities. The Company shall pay all Additional
Interest, if any, in the amounts and in the manner set forth in the Registration
Rights Agreement.
48
(b) The Company shall pay interest (including post-petition interest
in any proceeding under any Bankruptcy Law) on overdue principal at the rate
equal to 2% per annum in excess of the then applicable interest rate on the
Securities to the extent lawful; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue installments of
interest (without regard to any applicable grace period) at the same rate to the
extent lawful.
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.
(a) 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 Securities may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Securities and this Indenture
may be served. The Company shall give prior 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.
(b) The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided, however, 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 prior 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.
(c) The Company hereby designates the Corporate Trust Office of the
Trustee as one such office or agency of the Company in accordance with Section
2.03.
SECTION 4.03. SEC REPORTS.
The Company will file with the Trustee and provide to the holders of
the Securities, within 15 days after it files them with the Commission, copies
of the annual reports and of the information, documents and other reports (or
copies of such portions of any of the foregoing as the Commission may by rules
and regulations prescribe) which the Company files with the Commission pursuant
to Section 13 or 15(d) of the Exchange Act. In the event that the Company is
not required to file such reports with the Commission pursuant to the Exchange
Act, the Company will nevertheless deliver such Exchange Act information to the
holders of the Notes within 15 days after it would have been required to file it
with the Commission.
49
SECTION 4.04. COMPLIANCE CERTIFICATES.
(a) The Company shall deliver to the Trustee, within 90 days after the
end of each fiscal year, an Officers' Certificate signed by its principal
executive officer, principal financial officer or principal accounting officer
stating that a review of the activities of the Company and its Subsidiaries, as
the case may be, during the preceding fiscal year has been made under the
supervision of the signing Officers with a view to determining whether each 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 each has kept, observed, performed and
fulfilled each and every covenant contained in this Indenture and is not in
default in the performance or observance of any of the terms, provisions 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 each is taking or proposes to take with
respect thereto).
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03 above shall be accompanied by a
written statement of (x) the Company's independent public accountants (who shall
be a firm of established national reputation) that in making the examination
necessary for certification of such financial statements nothing has come to
their attention which would lead them to believe that the Company has violated
any provisions of Article 4, 5 or 6 of this Indenture insofar as they relate to
accounting matters or, if any such violation has occurred, specifying the nature
and period of existence thereof, it being understood that such accountants shall
not be liable directly or indirectly to any Person for any failure to obtain
knowledge of any such violation and (y) to the extent required under the TIA or
otherwise, if any Restricted Subsidiary's financial statements are not prepared
on a consolidated basis with the Company's, such Restricted Subsidiary's
independent public accountants (who shall be a firm of established national
reputation) that in making the examination necessary for certification of the
financial statements nothing has come to their attention which would lead them
to believe that the Restricted Subsidiary is in Default under this Indenture or,
if any such Default has occurred, specifying the nature and period of existence
thereof, it being understood that such accountants shall not be liable directly
or indirectly to any Person for any failure to obtain knowledge of any such
violation.
(c) The Company shall, so long as any of the Securities are
outstanding, deliver to the Trustee, forthwith upon any Officer becoming aware
of any Default or Event of Default specifying such Default or Event of Default
and what
50
action the Company is taking or proposes to take with respect thereto.
(d) The Company shall also comply with TIA (S) 314(a)(4).
SECTION 4.05. TAXES.
The Company will, and will cause its Restricted Subsidiaries to, pay
and discharge when due and pay all taxes, levies, imposts, duties or other
governmental charges ("Taxes") imposed on its income or profits or on any of its
properties except such Taxes which are being contested in good faith in
appropriate proceedings, and for which adequate reserves have been established
in accordance with GAAP.
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 (including, but not limited to, the payment of
any amounts due on the Securities); and the Company and each Subsidiary
Guarantor (to the extent that they may lawfully do so) hereby expressly waive
all benefit or advantage of any such law, and covenant that they 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.
SECTION 4.07. LIMITATION ON RESTRICTED PAYMENTS.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries, directly or indirectly, to (i) declare or pay any dividend or make
any distribution on or in respect of its Capital Stock (including any payment in
connection with any merger or consolidation involving the Company or any of its
Restricted Subsidiaries) except (A) dividends or distributions payable in its
Capital Stock (other than Disqualified Stock) or in options, warrants or other
rights to purchase such Capital Stock, and (B) dividends or distributions
payable to the Company or any of its Restricted Subsidiaries by any of its
Subsidiaries (and if the Restricted Subsidiary paying the dividend or making the
distribution is not a Wholly-Owned Subsidiary, to its other holders of Capital
Stock on a pro rata basis), (ii) purchase, redeem, retire or otherwise acquire
for value any Capital Stock of the Company held by Persons other than a Wholly-
Owned Subsidiary of the Company (other than in exchange for Capital Stock of the
Company (other than Disqualified Stock)) or any Capital Stock of a Restricted
Subsidiary held by any Affiliate of the Company, other than a Wholly-Owned
Subsidiary
51
(other than in exchange for Capital Stock of the Company or such Subsidiary
(other than Disqualified Stock)), (iii) purchase, repurchase, redeem, defease or
otherwise acquire or retire for value, prior to scheduled maturity, scheduled
repayment or scheduled sinking fund payment, any Subordinated Obligations (other
than the purchase, repurchase or other acquisition of Subordinated Obligations
purchased in anticipation of satisfying a sinking fund obligation, principal
installment or final maturity, in each case due within one year of the date of
purchase, repurchase or acquisition) or (iv) make any Investment (other than a
Permitted Investment) in any Person (any such dividend, distribution, purchase,
redemption, repurchase, defeasance, other acquisition, retirement or Investment
as described in preceding clauses (i) through (iv) being referred to as a
"Restricted Payment"); if at the time the Company or such Restricted Subsidiary
makes such Restricted Payment:
(i) a Default shall have occurred and be continuing (or would
result therefrom); or
(ii) the Company is not able to Incur an additional $1.00 of
Senior Indebtedness pursuant to paragraph (a) under Section 4.09.; or
(iii) the aggregate amount of such Restricted Payment and all
other Restricted Payments declared or made subsequent to the Issue Date
would exceed the sum of (A) 50% of the Cumulative Available Cash Flow
accrued during the period (treated as one accounting period) from the first
day of the fiscal quarter beginning on or after the Issue Date to the end
of the most recent fiscal quarter ending prior to the date of such
Restricted Payment as to which financial results are available (but in no
event ending more than 135 days prior to the date of such Restricted
Payment) (or, in case such Cumulative Available Cash Flow shall be a
deficit, minus 100% of such deficit); (B) the aggregate net proceeds
received by the Company from the issue or sale of its Capital Stock (other
than Disqualified Stock) to the extent not applied to redeem Securities as
described under Section 3.07 (b) or other capital contributions subsequent
to the Issue Date (other than net proceeds received from an issuance or
sale of such Capital Stock to (x) a Subsidiary of the Company, (y) an
employee stock ownership plan or similar trust or (z) management employees
of the Company or any Subsidiary of the Company); provided, however, that
the value of any non-cash net proceeds shall be as determined by the Board
of Directors in good faith, except that in the event the value of any non-
cash net proceeds shall be $2 million or more, the value shall be as
determined in writing by an independent investment banking firm of
nationally recognized standing; (C) the amount by which Indebtedness of the
Company is reduced on the Company's balance sheet upon the conversion or
exchange (other than by a Restricted Subsidiary of the Company) subsequent
to the Issue Date of
52
any Indebtedness of the Company convertible or exchangeable for Capital
Stock of the Company (less the amount of any cash, or other property,
distributed by the Company upon such conversion or exchange); and (D) the
amount equal to the net reduction in Investments (other than Permitted
Investments) made after the Issue Date by the Company or any of its
Restricted Subsidiaries in any Person resulting from (i) repurchases or
redemptions of such Investments by such Person (including liquidating
dividends thereon), proceeds realized upon the sale of such Investment to
an unaffiliated purchaser, repayments of loans or advances or other
transfers of assets by such Person to the Company or any Restricted
Subsidiary of the Company or (ii) the redesignation of Unrestricted
Subsidiaries as Restricted Subsidiaries or the qualification of non-wholly
owned Restricted Subsidiaries as Wholly Owned Subsidiaries (valued in each
case as provided in the definition of "Investment") not to exceed, in the
case of any Unrestricted Subsidiary or any non-wholly owned Subsidiary that
thereafter qualifies as a Wholly- Owned Subsidiary, the amount of
Investments previously included in the calculation of the amount of
Restricted Payments; provided, however, that no amount shall be included
under this clause (D) to the extent it is already included in Cumulative
Available Cash Flow.
(b) The provisions of paragraph (a) shall not prohibit: (i) any
purchase or redemption of Capital Stock or Subordinated Obligations of the
Company made by exchange for, or out of the proceeds of the substantially
concurrent sale of, Capital Stock of the Company (other than Disqualified Stock
and other than Capital Stock issued or sold to a Subsidiary, an employee stock
ownership plan or similar trust or management employees of the Company or any
Subsidiary of the Company); provided, however, that (A) such purchase or
redemption shall be excluded in the calculation of the amount of Restricted
Payments and (B) the Net Cash Proceeds from such sale shall be excluded from
clause (3)(B) of paragraph (a); (ii) any purchase or redemption of Subordinated
Obligations of the Company made by exchange for, or out of the proceeds of the
substantially concurrent sale of, Subordinated Obligations of the Company in
compliance with Section 4.09; provided, however, that such purchase or
redemption shall be excluded in the calculation of the amount of Restricted
Payments; (iii) any purchase or redemption of Subordinated Obligations from Net
Available Cash to the extent permitted under Section 4.10; provided, however,
that such purchase or redemption shall be excluded in the calculation of the
amount of Restricted Payments; (iv) any purchase or redemption of Capital Stock
pursuant to the terms of the MSO Agreements in an amount not in excess of $2.5
million on a cumulative basis on and after the Issue Date; provided that such
purchase or redemption shall be included in the calculation of Restricted
Payments; and (v) dividends paid within 60 days after the date of declaration if
at such date of declaration such dividend would have complied with this
provision; provided,
53
however, that such dividend shall be included in the calculation of the amount
of Restricted Payments; and provided, further, in each case that no Default or
Event of Default shall have occurred or be continuing at the time of such
payment or as a result thereof.
(c) For purposes of determining compliance with the foregoing
covenant, Restricted Payments may be made with cash or non-cash assets, provided
that any Restricted Payment made other than in cash shall be valued at the fair
market value (determined, subject to the additional requirements of the
immediately succeeding proviso, in good faith by the Board of Directors) of the
assets so utilized in making such Restricted Payment, provided, further that (i)
in the case of any Restricted Payment made with Capital Stock or Indebtedness,
such Restricted Payment shall be deemed to be made in an amount equal to the
greater of the fair market value thereof and the liquidation preference (if any)
or principal amount of the Capital Stock or Indebtedness, as the case may be, so
utilized, and (ii) in the case of any Restricted Payment made with non-cash
assets in an aggregate amount in excess of $2 million, a written opinion as to
the fairness of the valuation thereof (as determined by the Company) for
purposes of determining compliance with Section 4.09 shall be issued by an
independent investment banking firm of national standing.
(d) Not later than the date of making any Restricted Payment, the
Company shall deliver to the Trustee an Officer's Certificate stating that such
Restricted Payment complies with the Indenture and setting forth in reasonable
detail the basis upon which the required calculations were computed, which
calculations may be based upon the Company's latest available quarterly
financial statements and a copy of any required investment banker's opinion.
(e) Insofar as the Company has made Investments in a Wholly Owned
Subsidiary, whether before, on, or after the Issue Date, and such Subsidiary
thereafter ceases to be a Wholly Owned Subsidiary, on the date such Subsidiary
ceases to be a Wholly Owned Subsidiary, the Company shall be deemed to make an
Investment that constitutes either a Restricted Payment or a Permitted Basket
Investment (to the extent eligible) in an amount equal to the sum of (i) fair
market value of the Capital Stock of such Subsidiary owned by the Company and
the Restricted Subsidiaries plus (but without duplication) (ii) the aggregate
amount of other Investments of the Company and its other Restricted Subsidiaries
in such Subsidiary, in each case as of the date on which such Subsidiary ceases
to be a Wholly Owned Subsidiary.
SECTION 4.08. LIMITATION ON RESTRICTIONS ON DISTRIBUTIONS FROM RESTRICTED
SUBSIDIARIES.
54
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, create or permit to exist or become effective any consensual
encumbrance or restriction on the ability of any such Restricted Subsidiary to
(i) pay ordinary dividends or make any other distributions on its Capital Stock
or pay any Indebtedness or other obligation owed to the Company, (ii) make any
loans or advances to the Company or (iii) transfer any of its property or assets
to the Company, except: (a) any encumbrance or restriction pursuant to an
agreement in effect at or entered into on the Issue Date; (b) any encumbrance or
restriction with respect to such a Restricted Subsidiary pursuant to an
agreement relating to any Indebtedness Incurred by such Restricted Subsidiary on
or prior to the date on which such Restricted Subsidiary was acquired by the
Company and outstanding on such date (other than Indebtedness Incurred in
anticipation of, or to provide all or any portion of the funds or credit support
utilized to consummate, the transaction or series of related transactions
pursuant to which such Restricted Subsidiary became a Restricted Subsidiary of
the Company or was acquired by the Company); (c) any encumbrance or restriction
with respect to such a Restricted Subsidiary pursuant to an agreement evidencing
Indebtedness Incurred without violation of the Indenture or effecting a
refinancing of Indebtedness issued pursuant to an agreement referred to in
clause (b) or this clause (c) or contained in any amendment to an agreement
referred to in clauses (a) or (b) or this clause (c); provided, however, that
the encumbrances and restrictions with respect to such Restricted Subsidiary
contained in any of such agreement, refinancing agreement or amendment, taken as
a whole, are no less favorable to the holders of the Securities in any material
respect, as determined in good faith by the Board of Directors of the Company,
than encumbrances and restrictions with respect to such Restricted Subsidiary
contained in agreements in effect at, or entered into on, the Issue Date; (d) in
the case of clause (iii), any encumbrance or restriction (A) that restricts in a
customary manner the subletting, assignment or transfer of any property or asset
that is a lease, license, conveyance or contract or similar property or asset,
(B) by virtue of any transfer of, agreement to transfer, option or right with
respect to, or Lien on, any property or assets of the Company or any Restricted
Subsidiary not otherwise prohibited by the Indenture, (C) that is included in a
licensing agreement to the extent such restrictions limit the transfer of the
property subject to such licensing agreement, or (D) arising or agreed to in the
ordinary course of business and that does not, individually or in the aggregate,
detract from the value of property or assets of the Company or any of its
Subsidiaries in any manner material to the Company or any such Restricted
Subsidiary; (e) any encumbrance or restriction applicable to a Restricted
Subsidiary that Incurs Bank Indebtedness without violation of the Indenture,
provided, however, that such encumbrances and restrictions are applicable only
following the occurrence and during the continuance, of a payment default under
the terms of the agreements governing, or the acceleration of all of, such Bank
Indebtedness; (f) in the
55
case of clause (iii) above, restrictions contained in security agreements,
mortgages or similar documents securing Indebtedness of a Restricted Subsidiary
to the extent such restrictions restrict the transfer of the property subject to
such security agreements; (g) any restriction with respect to such a Restricted
Subsidiary imposed pursuant to an agreement entered into for the sale or
disposition of all or substantially all the Capital Stock or assets of such
Restricted Subsidiary pending the closing of such sale or disposition; and (h)
encumbrances or restrictions arising or existing by reason of applicable law.
SECTION 4.09. LIMITATION ON INDEBTEDNESS.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, Incur any Indebtedness; provided, however, that the Company and
its Restricted Subsidiaries that are Subsidiary Guarantors may Incur
Indebtedness if (i) no Default or Event of Default shall have occurred and be
continuing at the time of such Incurrence or would occur as a consequence of
such Incurrence and (ii) on the date thereof the Consolidated Coverage Ratio (A)
with respect to Indebtedness pari passu with the Securities, would be greater
than or equal to 2.0:1 and (B) with respect to Subordinated Obligations, would
be greater than or equal to 1.50:1.
(b) Notwithstanding the foregoing paragraph (a), the Company and its
Restricted Subsidiaries may Incur the following Indebtedness:
(i) Indebtedness of the Company or any Restricted Subsidiary
under Bank Indebtedness and under standby letters of credit or
reimbursement obligations with respect thereto issued in the ordinary
course of business and consistent with industry practice, provided,
however, that the principal amount of any Indebtedness Incurred pursuant to
this clause (i) shall not exceed $20 million at any time outstanding;
(ii) Indebtedness represented by Capitalized 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 or equipment used in a Permitted
Business or Incurred to refinance any such purchase price or cost of
construction or improvement, in each case Incurred no later than 365 days
after the date of such acquisition or the date of completion of such
construction or improvement; provided, however, that the principal amount
of any Indebtedness Incurred pursuant to this clause (ii), together with
Indebtedness Incurred in connection with Sale/Leaseback Transactions in
accordance with Section 4.17, shall not exceed $5 million at any time
outstanding;
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(iii) Indebtedness of the Company owing to and held by any
Wholly-Owned Subsidiary or Indebtedness of a Restricted Subsidiary owing to
and held by the Company or any Wholly-Owned Subsidiary; provided, however,
that any subsequent issuance or transfer of any Capital Stock or any other
event which results in any such Wholly-Owned Subsidiary ceasing to be a
Wholly-Owned Subsidiary or any subsequent transfer of any such Indebtedness
(except to the Company or any Wholly-Owned Subsidiary) shall be deemed, in
each case, to constitute the Incurrence of such Indebtedness by the issuer
thereof;
(iv) Indebtedness represented by (w) the Securities, (x)
Existing Indebtedness and (y) any Refinancing Indebtedness Incurred in
respect of any Indebtedness described in this clause (iv) or Incurred
pursuant to paragraph (a);
(v) (A) Indebtedness of a Person Incurred on or before and
outstanding on the date on which such Person becomes a Restricted
Subsidiary of the Company (other than Indebtedness Incurred in anticipation
of, or to provide all or any portion of the funds or credit support
utilized to consummate the transaction or series of related transactions
pursuant to which such Person became a Subsidiary or was otherwise acquired
by the Company); provided, however, that at the time such Person is
acquired by the Company, the Company would have been able to Incur an
additional $1.00 of Senior Indebtedness pursuant to paragraph (a) above
after giving effect to the Incurrence of such Indebtedness pursuant to this
clause (v) and (B) Refinancing Indebtedness Incurred by a Restricted
Subsidiary in respect of Indebtedness Incurred by such Restricted
Subsidiary or another Restricted Subsidiary the Capital Stock of which is
owned, either directly or indirectly, by the Restricted Subsidiary
Incurring such Refinancing Indebtedness, pursuant to this clause (v);
(vi) Indebtedness (A) in respect of performance bonds, bankers'
acceptances and surety or appeal bonds provided by the Company or any of
its Restricted Subsidiaries to their customers in the ordinary course of
their business, (B) in respect of performance bonds or similar obligations
of the Company or any of its Restricted Subsidiaries for or in connection
with pledges, deposits or payments made or given in the ordinary course of
business in connection with or to secure statutory, regulatory or similar
obligations, including obligations under health, safety or environmental
obligations, (C) arising from Guarantees to suppliers, lessors, licensees,
contractors, franchises or customers of obligations (other than
Indebtedness) Incurred in the ordinary course of business and (D) under
Currency Agreements and Interest Rate Agreements; provided, however, that
in the case of Currency
57
Agreements and Interest Rate Agreements, such Currency Agreements and
Interest Rate Agreements are entered into for bona fide hedging purposes of
the Company or its Restricted Subsidiaries (as determined in good faith by
the Board of Directors of the Company) and correspond in terms of notional
amount, duration, currencies and interest rates as applicable, to
Indebtedness of the Company or its Restricted Subsidiaries Incurred without
violation of the Indenture or to business transactions of the Company or
its Restricted Subsidiaries on customary terms entered into in the ordinary
course of business;
(vii) Indebtedness consisting of (A) Guarantees by the Company
of Indebtedness Incurred by a Wholly-Owned Subsidiary without violation of
the Indenture (so long as the Company could have Incurred such Indebtedness
directly without violation of the Indenture) and (B) Guarantees by a
Restricted Subsidiary of Senior Indebtedness Incurred by the Company
without violation of the Indenture (so long as such Restricted Subsidiary
could have Incurred such Indebtedness directly without violation of the
Indenture);
(viii) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument issued by the
Company or its Restricted Subsidiaries drawn against insufficient funds in
the ordinary course of business in an amount not to exceed $500,000 at any
time, provided that such Indebtedness is extinguished within two business
days of its Incurrence; and
(ix) Indebtedness (other than Indebtedness permitted under
clauses (i) through (viii)) in a principal amount which, when taken
together with the principal amount of all other Indebtedness Incurred
pursuant to this clause (ix) and then outstanding, will not exceed $5
million (it being understood that any Indebtedness Incurred under this
clause (ix) shall cease to be deemed Incurred or outstanding for purposes
of this clause (ix) (but shall be deemed to be Incurred for purposes of
paragraph (a) or paragraph (b)(i) or (ii), as the case may be) from and
after the first date on which the Company or its Restricted Subsidiaries
could have Incurred such Indebtedness under the foregoing paragraph (a) or,
to the extent applicable, paragraph (b)(i) or (ii) without reliance upon
this clause (ix)).
(c) Neither the Company nor any Restricted Subsidiary shall Incur any
Indebtedness under paragraph (b) above if the proceeds thereof are used,
directly or indirectly, to refinance any Subordinated Obligations of the Company
or any Restricted Subsidiary unless such Indebtedness shall be subordinated to
the Senior Indebtedness to at least the same extent as the Subordinated
Obligations being refinanced.
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(d) Notwithstanding paragraphs (a) and (b) above, neither the Company
nor any Restricted Subsidiary of the Company shall incur any liability, either
direct or contingent, in respect of Bank Indebtedness unless (i) in the case of
the Company, the Company is the borrower or primary obligor in respect of such
Bank Indebtedness or (ii) in the case of any Restricted Subsidiary, such
Restricted Subsidiary is either (a) the borrower or primary obligor in respect
of such Bank Indebtedness or (b) a Wholly Owned Subsidiary of such borrower or
primary obligor.
SECTION 4.10. LIMITATION ON SALES OF ASSETS AND SUBSIDIARY STOCK.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, make any Asset Disposition unless (i) the Company or such
Restricted Subsidiary receives consideration at the time of such Asset
Disposition at least equal to the fair market value (as determined in good faith
by senior management of the Company or, if the fair market value of such assets
exceeds $500,000, by the Company's Board of Directors) (including as to the
value of all non-cash consideration), of the shares and assets subject to such
Asset Disposition, (ii) at least 80% of the consideration thereof received by
the Company or such Restricted Subsidiary is in the form of cash or Cash
Equivalents, Additional Assets or distribution agreements with radio stations or
cable television operators or other video distributors which would receive
programming of the Company or its Restricted Subsidiaries according to the
Company's historical practice and (iii) an amount equal to 100% of the Net
Available Cash from such Asset Disposition is applied by the Company (or such
Restricted Subsidiary, as the case may be): (A) first, to the extent the
Company or any Restricted Subsidiary elects (or is required by the terms of any
Senior Indebtedness), (x) to prepay, repay or purchase Senior Indebtedness of
the Company or its Restricted Subsidiaries or (y) to the investment in or
acquisition of Additional Assets within 180 days from the later of the date of
such Asset Disposition or the receipt of such Net Available Cash; (B) second,
within 180 days from the receipt of such Net Available Cash, to the extent of
the balance of such Net Available Cash after application in accordance with
clause (A), to make an offer to purchase Securities (C) third, within 180 days
after the later of the application of Net Available Cash in accordance with
clauses (A) and (B) and the date that is one year from the receipt of such Net
Available Cash, to the extent of the balance of such Net Available Cash after
application in accordance with clauses (A) and (B), to prepay, repay or
repurchase Indebtedness (other than Preferred Stock) of a Wholly-Owned
Subsidiary (in each case other than Indebtedness owed to the Company or another
Wholly-Owned Subsidiary); and (D) fourth, to the extent of the balance of such
Net Available Cash after application in accordance with clauses (A), (B) and
(C), to (w) the investment in or acquisition of Additional Assets, (x) the
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making of Temporary Cash Investments, (y) the prepayment, repayment or purchase
of Indebtedness of the Company (other than Indebtedness owing to any Subsidiary
of the Company) or Indebtedness of any Subsidiary (other than Indebtedness owed
to the Company or any of its Restricted Subsidiaries) or (z) any other purpose
otherwise permitted under the Indenture, in each case within the later of 45
days after the application of Net Available Cash in accordance with clauses (A),
(B) and (C) or the date that is one year from the receipt of such Net Available
Cash; provided, however, that, in connection with any prepayment, repayment or
purchase of Indebtedness pursuant to clause (A), (B), (C) or (D) above, the
Company or such Restricted Subsidiary shall retire such Indebtedness and shall
cause the related loan commitment (if any) to be permanently reduced in an
amount equal to the principal amount so prepaid, repaid or purchased; provided,
however, that the foregoing shall not be deemed to require any reduction in the
commitment for Bank Indebtedness to less than $20 million. Notwithstanding the
foregoing provisions, the Company and its Restricted Subsidiaries shall not be
required to apply any Net Available Cash in accordance herewith except to the
extent that the aggregate Net Available Cash from all Asset Dispositions which
has not been applied in accordance with this covenant at any time exceeds $5
million. The Company shall not be required to make an offer for Securities
pursuant to this covenant if the Net Available Cash available therefor (after
application of the proceeds as provided in clause (a)(iii)(A)) is less than $5
million for any particular Asset Disposition (which lesser amounts shall be
carried forward for purposes of determining whether an offer is required with
respect to the Net Available Cash from any subsequent Asset Disposition).
For the purposes of this covenant, the following will be deemed to be
cash: (x) the assumption by the transferee of Senior Indebtedness of the Company
or Senior Indebtedness of any Restricted Subsidiary of the Company and the
release of the Company or such Restricted Subsidiary from all liability on such
Senior Indebtedness or Senior Indebtedness in connection with such Asset
Disposition (in which case the Company shall, without further action, be deemed
to have applied such paid Senior Indebtedness in accordance with clause
(a)(iii)(A)) and (y) securities received by the Company or any Restricted
Subsidiary of the Company from the transferee that are promptly (and in any
event within 60 days) converted by the Company or such Restricted Subsidiary
into cash.
(b) In the event of an Asset Disposition that requires the purchase of
Securities pursuant to clause (a)(iii)(B), the Company will be required to
purchase Securities tendered pursuant to an offer by the Company for the
Securities at a purchase price of 101% of their principal amount plus accrued
and unpaid interest, if any, to the purchase date in accordance with the
procedures (including prorating in the event of oversubscription) set forth in
herein. If the aggregate purchase price of the Securities tendered pursuant to
the offer is less than the Net
60
Available Cash allotted to the purchase of the Securities, the Company will
apply the remaining Net Available Cash in accordance with clauses (a)(iii)(C) or
(D) above.
(c) The Company will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to the
Indenture. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this covenant, the Company will comply
with the applicable securities laws and regulations and will not be deemed to
have breached its obligations under the Indenture by virtue thereof.
SECTION 4.11. LIMITATION ON AFFILIATE TRANSACTIONS.
(a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, enter into or conduct any transaction
or series of related transactions (including the purchase, sale, lease or
exchange of any property or the rendering of any service) with or for the
benefit of any Affiliate of the Company, other than a Wholly-Owned Subsidiary
(an "Affiliate Transaction") unless: (i) the terms of such Affiliate Transaction
are no less favorable to the Company or such Restricted Subsidiary, as the case
may be, than those that could be obtained at the time of such transaction in
arm's length dealings with a Person who is not such an Affiliate; (ii) in the
event such Affiliate Transaction involves an aggregate amount in excess of $1
million, the terms of such transaction have been approved by a majority of the
members of the Board of Directors of the Company and by a majority of the
Disinterested Directors, if any (and such majority or majorities, as the case
may be, determine that such Affiliate Transaction satisfies the criteria in (i)
above); (iii) in the event such Affiliate Transaction involves an aggregate
amount in excess of $2 million, the Company has received a written opinion from
an independent investment banking firm of nationally recognized standing that
such Affiliate Transaction is fair to the Company or such Restricted Subsidiary,
as the case may be, from a financial point of view; and (iv) such Affiliate
Transaction does not involve the acquisition of an Affiliate Business.
(b) The foregoing paragraph (a) shall not apply to (i) any Restricted
Payment permitted to be made pursuant to Section 4.07 or to any Permitted Basket
Investment, (ii) any issuance of securities, or other payments, awards or grants
in cash, securities or otherwise pursuant to, or the funding of, employment
arrangements, or any stock options and stock ownership plans for the benefit of
employees, officers and directors, consultants and advisors approved by the
Board of Directors of the Company, (iii) loans or advances to employees in the
ordinary course of business of the Company or any of its Restricted Subsidiaries
in aggregate amount outstanding not to exceed $500,000 at any time, (iv) loans
or advances to senior management
61
of the Company which loans and advances are secured by shares of Common Stock of
the Company owned by such senior management, in an aggregate amount outstanding
not to exceed $750,000, (v) any transaction between Wholly-Owned Subsidiaries,
(vi) indemnification agreements with, and the payment of fees and indemnities
to, directors, officers and employees of the Company and its Restricted
Subsidiaries, in each case in the ordinary course of business, (vii)
transactions pursuant to (x) agreements in existence on the Issue Date which are
(I) described in the Offering Memorandum or (II) otherwise, in the aggregate,
immaterial to the Company and its Restricted Subsidiaries taken as a whole,
including extensions of any such agreements which are approved by a majority of
Disinterested Directors and (y) arrangements in existence on the Issue Date
between Xxxxx Intercable, Inc. and the Company with respect to the allocation of
personnel and other related expenses from Xxxxx Intercable, Inc. to the Company
in accordance with the parties' historical practices; provided, however, that
such arrangements must be approved by a majority of the members of the Board of
Directors of the Company and by a majority of the Desinterested Directors, if
any, within 60 days of the Issue Date, (viii) any employment, non-competition or
confidentiality agreements entered into by the Company or any of its Restricted
Subsidiaries with its employees in the ordinary course of business, and (ix) the
issuance of Capital Stock of the Company (other than Disqualified Stock).
SECTION 4.12. LIMITATION ON LIENS.
The Company will not, and will not permit any Restricted Subsidiary
to, directly or indirectly, create, incur, assume or suffer to exist any Liens,
except for Permitted Liens.
SECTION 4.13. 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 its corporate
existence, and, subject to Section 4.10 and Section 4.20(c) the corporate,
partnership or other existence of each Restricted Subsidiary, in accordance with
the respective organizational documents (as the same may be amended from time to
time) of each Restricted Subsidiary and the rights (charter and statutory),
licenses and franchises of the Company and its Restricted Subsidiaries;
provided, however, that the Company shall not be required to preserve any such
right, license or franchise, or the corporate, partnership or other existence of
any Restricted Subsidiary, if the Board of Directors of the Company 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
Securityholders.
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SECTION 4.14. CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, each Securityholder
will have the right to require the Company to repurchase all or any part of such
Securityholder's Securities at a repurchase price in cash equal to 101% of the
principal amount thereof plus accrued and unpaid interest, if any, to the date
of purchase (the "Change of Control Payment") (subject in the case of
repurchases occurring after a record date and on or prior to the succeeding
interest payment date to the right of Securityholders of record on the relevant
record date to receive interest due on the relevant Interest Payment Date).
(b) Within 30 days following any Change of Control, unless the Company
has mailed a redemption notice with respect to all the outstanding Securities in
connection with such Change of Control, the Company shall mail a notice to each
Securityholder with a copy to the Trustee stating:
(i) that a Change of Control has occurred and that such
Securityholder has the right to require the Company to purchase such
Securityholder's Securities at a purchase price in cash equal to 101% of
the principal amount thereof plus accrued and unpaid interest, if any, to
the date of purchase (subject to the right of Securityholders of record on
a record date to receive interest on the relevant Interest Payment Date);
(ii) the repurchase date (which shall be no earlier than 30 days
nor later than 60 days from the date such notice is mailed) (the "Change of
Control Payment Date"); and
(iii) the procedures determined by the Company, consistent with
this Indenture, that a Securityholder must follow in order to have its
Securities purchased.
(c) Securityholders electing to have a Security repurchased must
surrender the Security, with the form entitled "Option of Securityholder to
Elect Purchase" on the reverse of the Security completed, to the Company at the
address specified in the notice at least 10 Business Days prior to the
repurchase date. Securityholders may withdraw their election if the Trustee or
the Company receives not later than three Business Days prior to the repurchase
date, a telegram, telex, facsimile transmission or letter setting forth the name
of the Securityholder, the principal amount of the Security which was delivered
for repurchase by the Securityholder and a statement that such Securityholder is
withdrawing his election to have such Security purchased.
(d) On the Change of Control Payment Date, the Company will, to the
extent lawful, (i) accept for payment all Securities or portions thereof
properly tendered pursuant to the Change of
63
Control Offer, (ii) deposit with the Trustee an amount equal to the Change of
Control Payment in respect of all Securities or portions thereof so tendered and
(iii) deliver or cause to be delivered to the Trustee the Securities so accepted
together with an Officers' Certificate stating the aggregate principal amount of
Securities or portions thereof being repurchased by the Company. The Trustee
will promptly mail to each Securityholder so tendered the Change of Control
Payment for such Securities, and the Trustee will promptly authenticate and mail
(or cause to be transferred by book entry) to each Securityholder a new Security
equal in principal amount to any unpurchased portion of the Securities
surrendered, if any; provided that each such new Security will be in a principal
amount of $1,000 or an integral multiple thereof. Unless the Company defaults in
the payment for any Securities properly tendered pursuant to the Change of
Control Offer, any Securities accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest after the Change of Control Payment
Date.
(e) The Company will, to the extent applicable, comply with any tender
offer rules under the Exchange Act which may then be applicable, including Rule
14e-1, in connection with any offer required to be made by the Company to
repurchase the Securities as a result of a Change of Control. To the extent
that the provisions of any securities laws or regulations conflict with the
provisions of this Indenture relative to the Company's obligation to make an
offer to repurchase the Securities as a result of a Change of Control, the
Company will comply with the applicable securities laws and regulations and will
not be deemed to have breached its obligations under such provisions of the
Indenture by virtue thereof.
SECTION 4.15. LIMITATION ON ISSUANCES OF CAPITAL STOCK OF RESTRICTED
SUBSIDIARIES.
The Company will not permit any of its Restricted Subsidiaries to
issue any Capital Stock to any Person (other than to the Company or a Wholly-
Owned Subsidiary of the Company) or permit any Person (other than the Company or
a Wholly-Owned Subsidiary of the Company) to own any Capital Stock of a
Restricted Subsidiary of the Company, if in either case as a result thereof such
Restricted Subsidiary would no longer be a Restricted Subsidiary of the Company;
provided, however, that this provision shall not prohibit (x) the Company or any
of its Restricted Subsidiaries from selling or otherwise disposing of all of the
Capital Stock of any Restricted Subsidiary or (y) the designation of a
Restricted Subsidiary as an Unrestricted Subsidiary in compliance with the
Indenture. The Company will not permit Holdco to issue any Capital Stock to any
Person (other than to the Company).
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SECTION 4.16. CONDUCT OF BUSINESS.
The Company will not, and will not permit its Restricted Subsidiaries
to, engage directly or indirectly in any business other than a Permitted
Business.
SECTION 4.17. LIMITATION ON SALE/LEASEBACK TRANSACTIONS.
The Company will not, and will not permit any Restricted Subsidiary
to, directly or indirectly, enter into, Guarantee or otherwise become liable
with respect to any Sale/Leaseback Transaction with respect to any property or
assets unless (i) the Company or such Restricted Subsidiary, as the case may be,
would be entitled to Incur Indebtedness secured by a Permitted Lien on such
property or assets in an amount equal to the Attributable Indebtedness with
respect to such Sale/Leaseback Transaction pursuant to the provisions hereof,
(ii) the Net Cash Proceeds from such Sale/Leaseback Transaction are at least
equal to the fair market value of the property or assets subject to such
Sale/Leaseback Transaction (such fair market value determined, in the event such
property or assets have a fair market value in excess of $500,000, no more than
30 days prior to the effective date of such Sale/Leaseback Transaction, by the
Board of Directors of the Company as evidenced by a resolution of such Board of
Directors), (iii) the Net Cash Proceeds of such Sale/Leaseback Transaction are
applied in accordance with Section 4.10 and (iv) the Indebtedness Incurred in
connection with such Sale/Leaseback Transaction, together with Indebtedness
Incurred in accordance with clause (b)(ii) of Section 4.09, does not exceed $5
million at any time outstanding.
SECTION 4.18. LIMITATION ON DESIGNATIONS OF UNRESTRICTED SUBSIDIARIES.
The Company may designate any Subsidiary of the Company (other than a
Subsidiary of the Company which owns Capital Stock of a Restricted Subsidiary)
as an "Unrestricted Subsidiary" under the Indenture (a "Designation") only if:
(i) no Default shall have occurred and be continuing at the time of
or after giving effect to such Designation; and
(ii) the Company would be permitted under the Indenture to make an
Investment constituting a Restricted Payment or a Permitted Basket
Investment at the time of Designation (assuming the effectiveness of such
Designation) in an amount (the "Designation Amount") equal to the sum of
(i) fair market value of the Capital Stock of such Subsidiary owned by the
Company and the Restricted Subsidiaries on such date plus (but without
duplication) (ii) the aggregate amount of other Investments of the Company
and the Restricted Subsidiaries in such Subsidiary on such date; and
65
(iii) unless the Company could make a Permitted Basket Investment in
the amount described in paragraph (b) above, the Company would be permitted
to Incur an additional $1.00 of Senior Indebtedness pursuant to paragraph
(a) of Section 4.09 at the time of Designation (assuming the effectiveness
of such Designation).
In the event of any such Designation, the Company shall be deemed to have made
an Investment constituting a Restricted Payment pursuant to Section 4.07 for all
purposes of the Indenture in the Designation Amount. The Company shall not, and
shall not permit any Restricted Subsidiary to, at any time (x) provide direct or
indirect credit support for or a guarantee of any Indebtedness of any
Unrestricted Subsidiary (including of any undertaking, agreement or instrument
evidencing such Indebtedness), (y) be directly or indirectly liable for any
Indebtedness of any Unrestricted Subsidiary or (z) be directly or indirectly
liable for any Indebtedness which provides that the holder thereof may (upon
notice, lapse of time or both) declare a default thereon or cause the payment
thereof to be accelerated or payable prior to its final scheduled maturity upon
the occurrence of a default with respect to any Indebtedness of any Unrestricted
Subsidiary (including any right to take enforcement action against such
Unrestricted Subsidiary), except, in the case of clause (x) or (y), to the
extent permitted under Section 4.07 and, in the case of clause (z), pursuant to
a Guarantee of such Indebtedness of an Unrestricted Subsidiary to the extent
such Guarantee is permitted under Section 4.07.
The Company may revoke any Designation of a Subsidiary as an
Unrestricted Subsidiary (a "Revocation"), whereupon such Subsidiary shall then
constitute a Restricted Subsidiary, if:
(i) no Default shall have occurred and be continuing at the time of
and after giving effect to such Revocation;
(ii) all Liens and Indebtedness of such Unrestricted Subsidiary
outstanding immediately following such Revocation would, if incurred at
such time, have been permitted to be incurred for all purposes of this
Indenture;
(iii) such Unrestricted Subsidiary does not own or operate an
Affiliate Business.
All Designations and Revocations must be evidenced by Board Resolutions of
the Company delivered to the Trustee certifying compliance with the foregoing
provisions.
SECTION 4.19. FURTHER INSTRUMENTS AND ACTS.
The Trustee shall not be bound to ascertain or inquire as to the
performance or observance of any covenants, conditions or agreements on the part
of the Company, except as otherwise set forth herein, but the Trustee may
require of the Company full
66
information and advice as to the performance of the covenants, conditions and
agreements contained herein, and upon request of the Trustee, the Company will
execute and deliver such further instruments and do such further acts as may be
reasonably necessary or proper to carry out more effectively the purposes of
this Indenture.
SECTION 4.20. SUBSIDIARY GUARANTEES.
(a) The Company shall cause each Subsidiary Guarantor to deliver a
Subsidiary Guarantee by executing this Indenture on the Issue Date. In
addition, the Company shall cause each Restricted Subsidiary of the Company
created or acquired after the date hereof (other than any foreign Subsidiary and
other than any domestic Restricted Subsidiary that is subject to a contractual
limitation, existing on the Issue Date, to its ability to issue a Subsidiary
Guarantee which limitation has not, with the exercise of such Restricted
Subsidiary's best efforts, been satisfied or waived) not later than fifteen (15)
days after such creation or acquisition to execute the Subsidiary Guarantee
Agreement in the form set forth in Exhibit C hereto and deliver such Subsidiary
---------
Guarantee Agreement and an Opinion of Counsel in form acceptable to the Trustee
(as set forth in paragraph (b) below) to the Trustee.
(b) The Opinion of Counsel required by clause (a) above shall state
that the Subsidiary Guarantee Agreement and the Letter Agreement have been duly
authorized, executed and delivered by such Subsidiary, that the obligations of
such Subsidiary under such Subsidiary Guarantee Agreement and such Letter
Agreement are enforceable against such Subsidiary in accordance with their terms
and that delivery by such Subsidiary of each of the Subsidiary Guarantee
Agreement and the Letter Agreement will not (i) result in any violation of the
provisions of the charter or bylaws of such Subsidiary, (ii) to the best
knowledge of such counsel, conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan or credit agreement or other agreement or
instrument known to such counsel to which such Subsidiary is a party, or (iii)
to the best knowledge of such counsel, result in any violation of the provisions
of any federal or state statute, or any order, rule or regulation of any federal
or state court or governmental agency or body having jurisdiction over such
Subsidiary or any of its properties or assets.
(c) In the event of a sale or other disposition of a Subsidiary
Guarantor (or all or substantially all of its assets) to a Person (whether or
not an Affiliate of the Subsidiary Guarantor) pursuant to a merger,
consolidation, sale of all or substantially all its assets or otherwise, which
is not a Subsidiary of the Company or the designation of a Subsidiary Guarantor
as an Unrestricted Subsidiary, which sale or disposition or designation is
otherwise in compliance with this
67
Indenture (including the provisions of Sections 4.10 and 4.18), such Subsidiary
Guarantor shall be deemed released from all its obligations under the Indenture
and its Subsidiary Guarantee and such Subsidiary Guarantee shall terminate;
provided, however, that any such termination shall occur only to the extent that
all of its guarantees of, and all of its pledges of assets or other security
interests which secure, any other Indebtedness of the Company or any other
Restricted Subsidiary shall also terminate upon such release, sale or transfer.
Upon delivery by the Company to the Trustee of an Officers' Certificate of the
Company 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 Sections 3.09, if applicable and 4.10
hereof, the Trustee shall execute any documents reasonably required in order to
evidence the release of any Subsidiary Guarantor from its obligations under
Article 10 hereof or pursuant to any Subsidiary Guarantee Agreement.
(d) Any Subsidiary Guarantor not released from its obligations under
its Subsidiary Guarantee shall remain liable for all amounts due on the
Securities and for the other obligations of any Subsidiary Guarantor under this
Indenture as provided in Article 10. The provisions of this Section 4.20 shall
not affect any of the Company's obligations under Section 4.01 hereof.
ARTICLE 5
SUCCESSORS
SECTION 5.01. LIMITATIONS ON MERGER, CONSOLIDATION OR SALE OF ASSETS.
The Company shall not consolidate with or merge with or into, or
convey, transfer or lease all or substantially all of its assets (otherwise than
pursuant to one or more Asset Dispositions that comply with Section 4.10) to any
Person, unless:
(i) the resulting, surviving or transferee Person (the "Successor
Company") shall be a corporation, partnership, trust, limited liability
company or other entity organized and existing under the laws of the United
States of America, any State thereof or the District of Columbia and the
Successor Company (if not the Company) shall expressly assume, by
supplemental indenture, executed and delivered to the Trustee, in form
satisfactory to the Trustee, all the obligations of the Company under the
Securities and this Indenture;
(ii) immediately after giving effect to such transaction (and treating
any Indebtedness that becomes an obligation of the Successor Company or any
Subsidiary of the
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Successor Company as a result of such transaction as having been Incurred
by the Successor Company or such Restricted Subsidiary at the time of such
transaction), no Default or Event of Default shall have occurred and be
continuing;
(iii) immediately after giving effect to such transaction, the
Successor Company (A) would have a Consolidated Net Worth equal to or
greater than the Consolidated Net Worth of the Company immediately prior to
such transaction and (B) would be able to Incur at least an additional
$1.00 of Indebtedness pursuant to paragraph (a) of Section 4.09;
(iv) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture (if any)
comply with this Indenture.
Notwithstanding clauses (ii) and (iii) of Section 5.01, any Restricted
Subsidiary of the Company may consolidate with or merge into the Company.
SECTION 5.02. SUCCESSOR CORPORATION SUBSTITUTED.
The Successor Company will succeed to, and be substituted for, and may
exercise every right and power of, the Company under this Indenture, but, in the
case of a lease of all or substantially all its assets, the Company will not be
released from the obligation to pay all amounts due on the principal of and
interest on the Securities.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT.
(a) An "Event of Default" occurs if:
(i) there is a default in any payment of interest on any
Security when due, continued for 30 days;
(ii) there is a default in the payment of principal of any
Security when due at its Stated Maturity, upon optional redemption, upon
required repurchase, upon declaration or otherwise;
(iii) there is a failure by the Company to comply with its
obligations under Section 5.01 hereof;
(iv) there is failure by the Company to comply for 30 days after
notice with any of its obligations under Article 4 hereof (in each case,
other than a failure to
69
purchase Securities which shall constitute an Event of Default under clause
(ii) above);
(v) there is a failure by the Company or any Subsidiary
Guarantor to comply for 60 days after notice with its other agreements
contained in this Indenture;
(vi) Indebtedness of the Company or any Restricted Subsidiary
is not paid within any applicable grace period after final maturity or is
accelerated by the holders thereof because of a default and the total
amount of such Indebtedness unpaid or accelerated exceeds $3 million and
such default shall not have been cured or such acceleration rescinded after
a 10-day period;
(vii) any judgment or decree for the payment of money in excess
of $3 million (to the extent not covered by insurance) is rendered against
the Company or a Significant Subsidiary and such judgment or decree shall
remain undischarged or unstayed for a period of 60 days after such judgment
becomes final and non-appealable;
(viii) the Company or any of its Significant Subsidiaries
pursuant to or within the meaning of any Bankruptcy Law:
(1) commences a voluntary case,
(2) consents to the entry of an order for relief against it
in an involuntary case,
(3) consents to the appointment of a Custodian of it or for
all or substantially all of its property,
(4) makes a general assignment for the benefit of its
creditors,
(5) consents to or acquiesces in the institution of a
bankruptcy or an insolvency proceeding against it, or
(6) takes any corporate action to authorize or effect any
of the foregoing; or
(ix) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(1) is for relief against the Company or any of its
Significant Subsidiaries in an involuntary case,
(2) appoints a Custodian of the Company or any of its
Significant Subsidiaries or for all or
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substantially all of the property of the Company or any of its
Significant Subsidiaries, or
(3) orders the liquidation of the Company or any of its
Significant Subsidiaries,
and the order or decree remains unstayed and in effect for 60 consecutive
days; or
(x) any Subsidiary Guarantee by a Significant Subsidiary ceases
to be in full force and effect (except as contemplated by the terms of this
Indenture) or any Subsidiary Guarantor that is a Significant Subsidiary
denies or disaffirms its obligations under this Indenture or its Subsidiary
Guarantee and such Default continues for 10 days;
(b) The term "Custodian" means any receiver, trustee, assignee,
liquidator or similar official under any Bankruptcy Law.
(c) A Default under clause (iv) or (v) of Section 6.01(a) hereof does
not constitute an Event of Default until the Trustee or the holders of 25% in
principal amount of the then outstanding Securities notify the Company or such
Subsidiary Guarantor, as the case may be, of the Default and the Company or such
Subsidiary Guarantor, as the case may be, does not cure such Default within the
time specified in such clause (iv) or (v) after receipt of the notice. Nothing
in this Section 6.01(c) shall impose on the Trustee an obligation to monitor the
activities of the Company or any Subsidiary Guarantor to ascertain compliance
with Article 4 hereof.
SECTION 6.02. ACCELERATION.
If an Event of Default occurs and is continuing, the Trustee or the
Holders of not less than 25% in aggregate principal amount of the then
outstanding Securities by notice to the Company, may declare (a "Declaration")
the unpaid principal of, and any accrued and unpaid interest, if any, on all the
Securities to be due and payable (the "Default Amount"). Upon any such
Declaration, the Default Amount shall be due and payable immediately. If an
Event of Default specified in clause (viii) or (ix) of Section 6.01(a) occurs
with respect to the Company, the Default Amount shall ipso facto become and be
immediately due and payable without any Declaration or other act on the part of
the Trustee or any Securityholder. The Holders of a majority in aggregate
principal amount of the then outstanding Securities by written notice to the
Trustee and to the Company may rescind any Declaration if the rescission would
not conflict with any judgment or decree and if all Events of Default then
continuing (other than any Events of Default with respect to the nonpayment of
principal of or interest on any Security which has become due solely as a result
of such Declaration) have been cured, and may waive any Default other than a
Default with respect to a covenant
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or provision that cannot be modified or amended without the consent of each
Securityholder pursuant to Section 9.02 hereof.
SECTION 6.03. OTHER REMEDIES.
(a) If an Event of Default occurs and is continuing, the Trustee and
the Securityholders may pursue any available remedy to collect the payment of
principal, premium, if any, or interest on the Securities or to enforce the
performance of any provision of the Securities or this Indenture.
(b) The Trustee may maintain a proceeding even if it does not possess
any of the Securities or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Securityholder 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.
Securityholders of not less than a majority in aggregate principal
amount of the then outstanding Securities by notice to the Trustee may, on
behalf of all the Securityholders, waive an existing Default or Event of Default
and its consequences, except a continuing Default or Event of Default in the
payment of any amount due on any Security (other than principal, premium (if
any) or interest which has become due solely as a result of a Declaration) or a
Default or Event of Default that cannot be modified or amended without the
consent of the Holder of each outstanding Security affected. 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.
Securityholders of a majority in principal amount of the Securities
then outstanding may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any remedy
available to the Trustee. 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 Securityholders or that may
involve the Trustee in personal liability. Prior to taking any action under
this Indenture, the Trustee shall be entitled to indemnification satisfactory to
it in its sole discretion against all losses and expenses caused by taking or
not taking such action.
SECTION 6.06. LIMITATION ON SUITS.
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(a) Except to enforce the right to receive payment of any amount when
due, no holder may pursue any remedy with respect to this Indenture or the
Securities unless:
(i) the Securityholder has previously given the Trustee written
notice that an Event of Default is continuing;
(ii) the Holders of at least 25% in principal amount of the then
outstanding Securities have requested to the Trustee to pursue the remedy;
(iii) such Securityholder or Securityholders have offered the
Trustee reasonable security or indemnity against any loss, liability or
expense;
(iv) the Trustee has not complied with such request within 60
days after receipt of the request and the offer of security or indemnity;
and
(v) the Holders of a majority in principal amount of the then
outstanding Securities have not given the Trustee a direction that, in the
opinion of such Trustee, is inconsistent with such request within such 60-
day period.
(b) A Securityholder may not use this Indenture to prejudice the
rights of another Securityholder or to obtain a preference or priority over
another Securityholder.
SECTION 6.07. RIGHTS OF SECURITYHOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of
Securityholders to receive payment of all amounts on the Securities, on or after
the respective due dates expressed in the Securities, 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 each Securityholder.
SECTION 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(a)(i) or (ii) or an
acceleration pursuant to Section 6.02 occurs and is continuing, the Trustee is
authorized to recover judgment in its own name and as trustee of an express
trust against the Company or any Subsidiary Guarantor or any other obligor on
the Securities for the Default Amount and, to the extent lawful, interest
thereon and such further amount as shall be sufficient to cover the costs and
expenses of collection, including any advances made by the Trustee and the
reasonable compensation, expenses and disbursements of the Trustee, its agents
and counsel.
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
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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
Securityholders allowed in any judicial proceedings relative to the Company or
any Subsidiary Guarantor (or any other obligor on the Securities), their
respective creditors or 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 Securityholder 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 Securityholders, 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 which the
Securityholders 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 Securityholder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Securityholder thereof, or to authorize the Trustee to vote
in respect of the claim of any Securityholder in any such proceeding.
SECTION 6.10. PRIORITIES.
(a) If the Trustee collects any money pursuant to this Article, it
shall pay out the money in the following order:
(i) First: to the Trustee, its agents and attorneys for amounts
due under Section 7.07, including payment of all compensation, expenses and
liabilities incurred, and all advances made, by the Trustee and the costs
and expenses of collection;
(ii) Second: if the Securityholders are forced to proceed
against the Company directly without the Trustee, to the Securityholders
for their collection costs;
(iii) Third: to the Securityholders for all amounts due and
unpaid on the Securities, without preference or priority of any kind,
according to the amounts due and payable on the Securities; and
74
(iv) Fourth: to the Company or, to the extent the Trustee
collects any amount from any Subsidiary Guarantor, to such Subsidiary
Guarantor, or to such party as a court of competent jurisdiction shall
direct.
(b) The Trustee may fix a record date and payment date for any
payment to Securityholders. At least 15 calendar days before such record date,
the Company shall mail to each Holder and the Trustee a notice that states the
record date, the payment date and the amount to be paid.
SECTION 6.11. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section does not apply to a suit by the Trustee, a suit by a Securityholder
pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in
aggregate principal amount of the then outstanding Securities.
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 their exercise as a
prudent person would exercise or use under the circumstances and in the conduct
of his or her own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Trustee undertakes to perform only those duties as are
specifically set forth in this Indenture and the duties of the Trustee
shall be determined solely by the express provisions of this Indenture, 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) the Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture, but 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 same to determine whether or not they conform to the
requirements of this Indenture.
(c) Notwithstanding anything to the contrary herein contained, the
Trustee may not be relieved from liability for its own negligent action 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 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) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability 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 adequate indemnity against such risk or liability is
not reasonably assured to it.
(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.
Assets held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
(g) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of Section 7.01 and to the provisions of the TIA.
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
76
presented by the proper Person. The Trustee need not investigate any fact or
matter stated in the document.
(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 reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel 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 agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its 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) The permissive rights of the Trustee to do certain things
enumerated in this Indenture shall not be construed as a duty and the Trustee
shall not be answerable for other than its negligence or willful default with
respect to such permissive rights.
(g) Except for an Event of Default under 6.01(a)(i) or (ii) hereof,
the Trustee shall not be deemed to have notice of any Default or Event of
Default unless specifically notified in writing of such event by the Company or
the Securityholders of not less than 25% in aggregate principal amount of
Securities outstanding.
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company, any
Subsidiary Guarantor or any Affiliate of the Company or any Subsidiary Guarantor
with the same rights it would have if it were not Trustee. Any Agent may do the
same with like rights. However, the Trustee is 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,
77
the Securities or the Subsidiary Guarantees, it shall not be accountable for the
Company's use of the proceeds from the Securities 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 Securities or the Subsidiary
Guarantees or any other document in connection with the sale of the Securities
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 each Securityholder 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 the payment of any amount due on any
Security, the Trustee may withhold the notice if and so long as its board of
directors, a committee of its board of directors or a committee of its Trust
officers in good faith determines that withholding the notice is in the interest
of the Securityholders. In addition, the Company is required to deliver to the
Trustee, within 90 days after the end of each fiscal year of the Company, a
certificate indicating whether the signers thereof know of any Default or Event
of Default that occurred during the previous year. The Company also is required
to deliver to the Trustee, within 30 days after the occurrence thereof, written
notice of any events which would constitute a Default.
SECTION 7.06. REPORTS BY TRUSTEE TO SECURITYHOLDERS.
(a) Within 60 days after each May 15 beginning with the May 15
following the date of this Indenture, and for so long as the Securities remain
outstanding, the Trustee shall mail to the Securityholders a brief report dated
as of such reporting date that complies with TIA (S) 313(a) (but if no event
described in TIA (S) 313(a) has occurred within the twelve months preceding the
reporting date, no report need be transmitted). The Trustee also shall comply
with TIA (S) 313(b)(2) and (c).
(b) A copy of each report at the time of its mailing to the
Securityholders shall be filed with the Commission and each stock exchange, if
any, on which the Securities are listed, in accordance with and to the extent
required by TIA (S) 313(d). The Company shall promptly notify the Trustee if
and when the Securities are listed on any stock exchange.
SECTION 7.07. COMPENSATION AND INDEMNITY.
(a) The Company and the each of the Subsidiary Guarantors, jointly
and severally, shall pay to the Trustee from
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time to time reasonable compensation for its acceptance of this Indenture and
services hereunder, including extraordinary services such as default
administration. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company and each of the
Subsidiary Guarantors, jointly and severally, shall reimburse the Trustee 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.
(b) The Company and each of the Subsidiary Guarantors, jointly and
severally, shall indemnify the Trustee against any and all losses, liabilities
or expenses incurred by it arising out of or in connection with the acceptance
or administration of its duties under this Indenture, including the costs and
expenses of enforcing this Indenture against the Company (including this Section
7.07) and defending itself against any claim (whether asserted by the Company,
any Holder or any other person) or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except as set forth below
in subparagraph (d). The Trustee shall notify the Company and each of the
Subsidiary Guarantors promptly of any claim for which it may seek indemnity.
Failure by the Trustee to so notify the Company or any Subsidiary Guarantor
shall not relieve the Company or any of the Subsidiary Guarantors of their
Obligations hereunder. The Trustee may have separate counsel and the Company
and each of the Subsidiary Guarantors, jointly and severally, shall pay the
reasonable fees and expenses of such counsel. Neither the Company nor any
Subsidiary Guarantor need pay for any settlement made without its consent.
(c) The obligations of the Company and each of the Subsidiary
Guarantors under this Section 7.07 shall survive the resignation or removal of
the Trustee and the satisfaction and discharge or termination of this Indenture.
(d) Notwithstanding subparagraphs (a) or (b) above, neither the
Company nor any Subsidiary Guarantor need reimburse any expense or indemnify
against any loss or liability incurred by the Trustee through its own negligence
or willful misconduct.
(e) To secure the Company's and each of the Subsidiary Guarantor's
payment obligations in this Section, the Trustee shall have a Lien prior to the
Securities on all money or property held or collected by the Trustee, except
that held in trust to pay principal, premium, if any, and interest on particular
Securities. Such Lien shall survive the resignation or removal of the Trustee
and the satisfaction and discharge of this Indenture.
(f) When the Trustee incurs expenses or renders services after an
Event of Default specified in Section
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6.01(viii) or (ix) hereof occurs, the expenses and the compensation for such
services (including the fees and expenses of its agents and counsel) are
intended to constitute expenses of administration under any Bankruptcy Law.
SECTION 7.08. REPLACEMENT OF TRUSTEE.
(a) 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 7.08.
(b) The Trustee may resign at any time and be discharged from the
trust hereby created by so notifying the Company. The Securityholders of a
majority in principal amount of the then outstanding Securities may remove the
Trustee by so notifying the Trustee and the Company. The Company may remove the
Trustee if:
(i) the Trustee fails to comply with Section 7.10 hereof;
(ii) 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;
(iii) a Custodian, receiver or other public officer takes charge
of the Trustee or its property; or
(iv) the Trustee becomes incapable of acting.
(c) If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall notify each Securityholder
of such event and 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 Securities may appoint a successor Trustee to
replace the successor Trustee appointed by the Company.
(d) 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 each Securityholder. The retiring Trustee shall promptly transfer
all property held by it as Trustee to the successor Trustee, provided all sums
owing to the retiring 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 and each of the Subsidiary
Guarantor's obligations under Section 7.07 hereof shall continue for the benefit
of the retiring Trustee.
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(e) If a successor Xxxxxxx does not take office within 60 days after
the retiring Trustee resigns or is removed, the retiring Trustee, the Company,
any of the Subsidiary Guarantors or the Securityholders of at least 10% in
principal amount of the then outstanding Securities may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(f) If the Trustee after written request by any Securityholder who has
been a Securityholder for at least six months fails to comply with Section 7.10,
such Securityholder may petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
(a) There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America or any State or Territory thereof or the District of Columbia authorized
under such laws to exercise corporate trustee power, shall be subject to
supervision or examination by Federal, State, Territorial, or District of
Columbia authority and shall have (or be a part of a holding company with) a
combined capital and surplus of at least $100 million as set forth in its most
recent published annual report of condition.
(b) This Indenture shall always have a Trustee who satisfies the
requirements of TIA (S) 310(a)(1), (2) and (5). The Trustee shall comply with
TIA (S) 310(b).
The provisions of TIA (S) 310 shall also apply to the Company and each of
the Subsidiary Guarantors, as obligor of the Securities.
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE COMPANY.
The Trustee shall comply with TIA (S) 311(a), excluding any creditor
relationship listed in TIA (S) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (S) 311(a) to the extent indicated therein. The
provisions of TIA (S) 311 shall apply to the Company and each of the Subsidiary
Guarantors as obligor on the Securities.
ARTICLE 8
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DISCHARGE OF INDENTURE
SECTION 8.01. DISCHARGE OF LIABILITY ON SECURITIES; DEFEASANCE.
(a) When (i) the Company delivers to the Trustee all outstanding
Securities (other than Securities replaced pursuant to Section 2.07 hereof) for
cancellation or (ii) all outstanding Securities have become due and payable and
the Company irrevocably deposits with the Trustee funds sufficient to pay at
maturity all outstanding Securities, including interest thereon (other than
Securities replaced pursuant to Section 2.07 hereof), and if in either case the
Company pays all other sums payable hereunder by the Company, then this
Indenture shall, subject to Sections 8.01(e) and 8.06 hereof, cease to be of
further effect. The Trustee shall acknowledge satisfaction and discharge of
this Indenture on demand of the Company accompanied by an Officers' Certificate
and an Opinion of Counsel reasonably acceptable to the Trustee and at the cost
and expense of the Company.
(b) Subject to Sections 8.01(e), 8.02 and 8.06 hereof, the Company at
any time may terminate (i) all its obligations under the Securities and this
Indenture ("legal defeasance option") or (ii) all obligations under Article 4,
Section 5.01(iii) and (iv) and the operation of Sections 6.01(a)(vi),
6.01(a)(vii) as well as 6.01(a)(viii), 6.01(a)(ix) and 6.01(a)(x) hereof but
only with respect to Significant Subsidiaries) ("covenant defeasance option").
The Company may exercise its legal defeasance option notwithstanding its prior
exercise of its covenant defeasance option.
(c) If the Company exercises its legal defeasance option, payment of
the Securities may not be accelerated because of an Event of Default. If the
Company exercises its covenant defeasance option, payment of the Securities may
not be accelerated because of an Event of Default specified in Section
6.01(a)(iii) to the extent the non-compliance results from a violation of
Section 5.01(iii) or 5.01(iv), Section 6.01(a)(iv), 6.01(a)(v), 6.01(a)(vi),
6.01(a)(vii) or 6.01(a)(viii), 6.01(a)(ix) and 6.01(a)(x) (but only, in the case
of Sections 6.01(a)(viii), (ix) and (x)), with respect to Significant
Subsidiaries), or because of the failure of the Company to comply with Sections
5.01(iii) or 5.01(iv).
(d) Upon satisfaction of the conditions set forth herein and Section
8.02 and upon request of the Company, the Trustee shall acknowledge in writing
the discharge of those obligations that the Company terminates.
(e) Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07, 7.07, 7.08, 8.01(d), 8.04,
8.05 and 8.06 hereof shall survive until the Securities have been paid in full.
Thereafter, the Company's obligations in Sections 7.07, 8.04 and 8.05 hereof
shall survive.
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SECTION 8.02. CONDITIONS TO DEFEASANCE.
(a) The Company may exercise its legal defeasance option or its
covenant defeasance option only if:
(i) the Company irrevocably deposits in trust with the Trustee
money or U.S. Government Obligations in amounts (including interest, but
without consideration of any reinvestment of such interest) and maturities
sufficient, but in the case of the legal defeasance option only, not more
than such amounts (as certified by a nationally recognized firm of
independent public accountants), to pay and discharge at their Stated
Maturity (or such earlier redemption date as the Company shall have
specified to the Trustee) the principal of, premium, if any, and interest
on all outstanding Securities to maturity or redemption, as the case may
be, and to pay all of the sums payable by it hereunder; provided, that the
Trustee shall have been irrevocably instructed to apply such money or the
proceeds of such U.S. Government Obligations to the payment of said
principal, premium, if any, and interest with respect to the Securities;
(ii) in the case of the legal defeasance option only, 123 days
pass after the deposit is made and during the 123 day period no Default or
Event of Default specified in Section 6.01(viii) or (ix) hereof with
respect to the Company or a Significant Subsidiary occurs which is
continuing at the end of the period;
(iii) no Default or Event of Default has occurred and is
continuing on the date of such deposit and after giving effect thereto;
(iv) the deposit does not constitute a default under any other
agreement binding on the Company;
(v) the Company delivers to the Trustee an Opinion of Counsel
to the effect that the trust resulting from the deposit does not
constitute, or qualify as, an investment company under the Investment
Company Act of 1940, as amended;
(vi) in the case of the legal defeasance option, the Company
shall have delivered to the Trustee an Opinion of Counsel stating that (x)
the Company has received from, or there has been published by, the Internal
Revenue Service a ruling, or (y) since the date of this Indenture there has
been a change in the applicable Federal income tax law, in either case to
the effect that, and based thereon such Opinion of Counsel shall confirm
that, the Securityholders will not recognize income, gain or loss for U.S.
Federal income tax purposes as a result of such defeasance and will be
subject to U.S. Federal income tax on the same amounts,
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in the same manner and at the same times as would have been the case if
such defeasance had not occurred;
(vii) in the case of the covenant defeasance option, the Company
shall have delivered to the Trustee an Opinion of Counsel to the effect
that the Securityholders will not recognize income, gain or loss for
Federal income tax purposes as a result of such covenant defeasance and
will be subject to 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; and
(viii) the Company delivers to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent to the defeasance and discharge of the Securities as contemplated
by this Article 8 have been complied with.
(b) In order to have money available on a payment date to pay
principal, premium, if any, or interest on the Securities, the U.S. Government
Obligations deposited pursuant to preceding clause (a) shall be payable as to
principal or interest at least one Business Day before such payment date in such
amounts as shall provide the necessary money. U.S. Government Obligations shall
not be callable at the issuer's option.
(c) Before or after a deposit, the Company may make arrangements
satisfactory to the Trustee for the redemption of Securities at a future date in
accordance with Article 3 hereof.
SECTION 8.03. APPLICATION OF TRUST MONEY.
The Trustee shall hold in trust money or U.S. Government Obligations
deposited with it pursuant to this Article 8. It shall apply the deposited
money and the money from U.S. Government Obligations through the Paying Agent
and in accordance with this Indenture to the payment of principal, premium, if
any, and interest on the Securities.
SECTION 8.04. REPAYMENT TO THE COMPANY.
(a) The Trustee and the Paying Agent shall promptly pay to the Company
upon written request any excess money or securities held by them at any time;
provided, however, that the Trustee shall not pay any such excess to the Company
unless the amount remaining on deposit with the Trustee, after giving effect to
such transfer are sufficient to pay principal, premium, if any, and interest on
the outstanding Securities, which amount shall be certified to the Trustee by
independent public accountants.
(b) The Trustee and the Paying Agent shall pay to the Company upon
written request any money held by them for the payment of principal, premium, if
any, or interest that remains
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unclaimed for two years after the date upon which such payment shall have become
due; provided, however, that the Company shall have either caused notice of such
payment to be mailed to each Securityholder entitled thereto no less than 30
days prior to such repayment or within such period shall have published such
notice in a financial newspaper of widespread circulation published in the City
of New York. After payment to the Company, Securityholders entitled to the money
must look to the Company and the Subsidiary Guarantors for payment as general
creditors unless an applicable abandoned property law designates another Person,
all liability of the Trustee and such Paying Agent with respect to such money
shall cease, and the Company and the Subsidiary Guarantors, jointly and
severally, shall pay and shall indemnify the Trustee against any cost or expense
arising from any claim for such money.
SECTION 8.05. INDEMNITY FOR GOVERNMENT OBLIGATIONS.
The Company and the Subsidiary Guarantors, jointly and severally,
shall pay and shall indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against deposited U.S. Government Obligations or the
principal and interest received on such U.S. Government Obligations.
SECTION 8.06. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with this Article 8 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 each of the Subsidiary Guarantor's Obligations under this
Indenture and the Securities and the Subsidiary Guarantees shall be revived and
reinstated as though no deposit had occurred pursuant to this Article 8 until
such time as the Trustee or Paying Agent is permitted to apply all such money or
U.S. Government Obligations in accordance with this Article 8; provided,
however, that if the Company or any Subsidiary Guarantor has made any payment of
principal of, premium, if any, or interest on any Securities because of the
reinstatement of its Obligations, the Company or any of the Subsidiary
Guarantors, as the case may be, shall be subrogated to the rights of the
Securityholders to receive such payment from the money or U.S. Government
Obligations held by the Trustee or Paying Agent.
ARTICLE 9
AMENDMENTS
SECTION 9.01. WITHOUT CONSENT OF SECURITYHOLDERS.
(a) Notwithstanding Section 9.02 of this Indenture, the Company, the
Subsidiary Guarantors and the Trustee may amend
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or supplement this Indenture or the Securities without the consent of any
Securityholder:
(i) to cure any ambiguity, omission, defect or inconsistency;
(ii) to comply with Article 5 hereof;
(iii) to provide for uncertificated Securities in addition to or
in place of certificated Securities (provided that the uncertificated
Securities are issued in registered form for purposes of Section 163(f) of
the Code, or in a manner such that the uncertificated Securities are
described in Section 163(f)(2)(B) of the Code);
(iv) to add further Guarantees with respect to the Securities;
or to secure the Securities with additional collateral;
(v) to add to the covenants of the Company for the benefit of
the Securityholders or to surrender any right or power conferred upon the
Company;
(vi) to comply with requirements of the Commission in order to
effect or maintain the qualification of this Indenture under the TIA;
(vii) to make any change that would provide additional rights or
benefits to the Holders of the Securities, as evidenced by an Opinion of
Counsel delivered to the Trustee or that does not adversely affect the
rights of any Securityholder in any respect; or
(viii) to evidence or provide for a replacement Trustee under
Section 7.08 hereof;
provided, that the Company has delivered to the Trustee an Opinion of Counsel
stating that any such amendment or supplement complies with the provisions of
this Section 9.01.
(b) Upon the request of the Company and the Subsidiary Guarantors
accompanied by Board Resolutions of their respective Boards of Directors
authorizing the execution of any such supplemental indenture, and upon receipt
by the Trustee of the documents described in Section 7.02 and Section 9.06
hereof, the Trustee shall join with the Company and the Subsidiary Guarantors in
the execution of any supplemental indenture authorized or permitted by the terms
of this Indenture and to make any further appropriate agreements and
stipulations which may be therein contained, but the Trustee shall not be
obligated to enter into such supplemental indenture which affects its own
rights, duties or immunities under this Indenture or otherwise.
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(c) After an amendment or supplement under this Section 9.01 becomes
effective, the Company shall mail to all Securityholders a notice briefly
describing such amendment or supplement. The failure to give such notice to all
Securityholders, or any defect therein, shall not impair or affect the validity
of an amendment or supplement under this Section.
SECTION 9.02. WITH CONSENT OF SECURITYHOLDERS.
(a) Except as provided below in this Section 9.02, the Company and the
Trustee may amend or supplement this Indenture or the Securities with the
written consent of the Securityholders of not less than a majority in aggregate
principal amount of the Securities then outstanding (including consents obtained
in connection with a purchase of, or tender offer or exchange offer for the
Securities) and, subject to Section 6.04 and 6.07, any existing Default or Event
of Default and its consequences or compliance with any provision of this
Indenture or the Securities may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Securities (including
consents obtained in connection with a purchase of, or tender offer or exchange
offer for the Securities). Furthermore, subject to Sections 6.04 and 6.07
hereof, the Holders of a majority in aggregate principal amount of the
Securities then outstanding (including consents obtained in connection with a
purchase of, or tender offer or exchange offer for the Securities) may waive
compliance in a particular instance by the Company with any provision of this
Indenture or the Securities. However, without the consent of each
Securityholder affected, an amendment, supplement or waiver under this Section
9.02 may not (with respect to any Securities held by a non-consenting Holder):
(i) reduce the principal amount of Securities whose Holders
must consent to an amendment, supplement or waiver;
(ii) reduce the stated rate of or extend the stated time for
payment of any interest on any Security;
(iii) reduce the principal of or extend the Stated Maturity of
any Security;
(iv) reduce the premium payable upon the redemption or
repurchase of any Security or change the time at which any Security may be
redeemed in accordance with Section 3.07;
(v) make any Security payable in money other than that stated
in the Security;
(vi) make any change in Section 6.04 or 6.07 hereof;
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(vii) impair the right of any Holder to receive payment of any
amount due on such Xxxxxx's Securities on or after the due dates therefor
or to institute suit for the enforcement of any payment on or with respect
to such Holder's Securities; or
(viii) make any change in the amendment provisions which require
each Securityholder's consent or in the waiver provisions.
(b) Upon the request of the Company and the Subsidiary Guarantors
accompanied by Board Resolutions of their respective Boards of Directors
authorizing the execution of any such supplemental indenture, and upon the
filing with the Trustee of evidence satisfactory to the Trustee of the consent
of the Securityholders as aforesaid, and upon receipt by the Trustee of the
documents described in Section 7.02 and Section 9.06 hereof, the Trustee shall
join with the Company and the Subsidiary Guarantors in the execution of such
supplemental indenture unless such supplemental indenture 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 supplemental indenture.
(c) It shall not be necessary for the consent of the Securityholders
under this Section 9.02 to approve the particular form of any proposed
amendment, supplement or waiver, but it shall be sufficient if such consent
approves the substance thereof.
(d) After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to all Securityholders 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 amendment, supplement or waiver.
SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Securities
shall comply with the TIA as then in effect.
SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS.
(a) Until an amendment, supplement or waiver becomes effective, a
consent to it by a Securityholder is a continuing consent by the Securityholder
and every subsequent Securityholder or portion of a Security that evidences the
same debt as the consenting Holder's Security, even if notation of the consent
is not made on any Security. However, any such Securityholder or subsequent
Securityholder may revoke the consent as to its Security if the Trustee receives
written notice of revocation before the date the waiver, supplement or amendment
becomes
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effective. An amendment, supplement or waiver becomes effective when approved by
the requisite Holders and executed by the Trustee (or, if otherwise provided in
such waiver, amendment or supplement, in accordance with its terms) and
thereafter binds every Securityholder, unless it makes a change described in any
clauses of Section 9.02(a), in which case, the amendment, supplement or waiver
shall bind only each Holder of a Security who has consented to it and every
subsequent Holder of a Security or portion of a Security that evidences the same
indebtedness as the consenting Xxxxxx's Security.
(b) The Company may fix a record date for determining which
Securityholders must consent to such amendment, supplement or waiver. If the
Company fixes a record date, the record date shall be fixed at (i) the later of
30 days prior to the first solicitation of such consent or the date of the most
recent list of Securityholders furnished to the Trustee prior to such
solicitation pursuant to Section 2.05 hereof, or (ii) such other date as the
Company shall designate. If a record date is fixed, then notwithstanding the
last sentence of the immediately preceding paragraph, those persons who were
Holders at such record date (or their duly designated proxies), and only those
persons, shall be entitled to consent to such amendment or waiver or revoke any
consent previously given, whether or not such persons continue to be Holders
after such record date. No consent shall be valid or effective for more than 90
days after such record date except to the extent that the requisite number of
consents to the amendment, supplement or waiver have been obtained within such
90-day period or as set forth in the preceding paragraph of this Section 9.04.
SECTION 9.05. NOTATION ON OR EXCHANGE OF SECURITIES.
(a) Securities authenticated and delivered after the execution of any
supplemental indenture may bear a notation in form approved by the Trustee as to
any matter provided for in such amendment, supplement or waiver on any Security
thereafter authenticated. The Company in exchange for all Securities may issue
and the Trustee shall authenticate new Securities that reflect the amendment,
supplement or waiver.
(b) Failure to make the appropriate notation or issue a new Security
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, waiver or supplemental indenture
authorized pursuant to this Article 9 if the amendment, waiver or supplemental
indenture does not adversely affect the rights, duties, liabilities or
immunities of the Trustee. If it does, the Trustee may, but need not, sign it.
In signing or refusing to sign such amendment, waiver or supplemental indenture,
the Trustee shall be entitled to receive
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and, subject to Section 7.01, shall be fully protected in relying upon, in
addition to the documents required by Section 7.02, an Officers' Certificate and
an Opinion of Counsel as conclusive evidence that such amendment, waiver or
supplemental indenture is authorized or permitted by this Indenture, that it is
not inconsistent herewith, and that it will be valid and binding upon the
Company in accordance with its terms.
SECTION 9.07. SUBSIDIARY GUARANTORS' SIGNATURE NOT REQUIRED.
Notwithstanding anything to the contrary in Article 10 of this
Indenture, if any Subsidiary Guarantor shall have been released from its
Obligations under Article 10 of this Indenture or any Subsidiary Guarantee
Agreement entered into by such Subsidiary Guarantor, the signature of such
Subsidiary Guarantor shall not be required in connection with any amendment of
this Indenture.
ARTICLE 10
SUBSIDIARY GUARANTEES
SECTION 10.01. SUBSIDIARY GUARANTEES.
Subject to this Article 10, each of the Subsidiary Guarantors, jointly
and severally, hereby unconditionally guarantees to each Holder of a Security
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 Securities or the obligations of the Company under this Indenture or the
Securities, that: (a) all amounts on the Securities shall be promptly paid in
full when due, whether at maturity, by acceleration, redemption, repurchase or
otherwise, and (to the extent permitted by law) interest on the overdue
principal, premium, if any, and interest on the Securities, if any, and all
other obligations of the Company to the Holders or the Trustee under this
Indenture or the Securities shall be promptly paid in full or performed, all in
accordance with the terms of this Indenture and the Securities; and (b) in case
of any extension of time of payment or renewal of any Securities or any of such
other obligations, the same shall 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 for whatever reason, the Subsidiary Guarantors shall be obligated
to pay the same immediately whether or not such failure to pay has become an
Event of Default which could cause acceleration pursuant to Article 6 hereof.
Each Subsidiary Guarantor agrees that this is a guarantee of payment and not a
guarantee of collection.
The Subsidiary Guarantors hereby agree that their obligations
hereunder shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or this
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Indenture, the absence of any action to enforce the same, any waiver or consent
by any Holder of the Securities 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 Subsidiary Guarantor hereby
waives diligence, presentment, demand for 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 covenants that, subject to this Article 10, this Subsidiary Guarantee shall
not be discharged except by complete performance of the obligations contained in
the Securities and this Indenture.
If any Holder of Securities or the Trustee is required by any court or
otherwise to return to the Company or the Subsidiary Guarantors, or any
custodian, trustee, liquidator or other similar official acting in relation to
either the Company or the Subsidiary Guarantors, any amount paid by either to
the Trustee or such Holder, the Subsidiary Guarantees, to the extent theretofore
discharged, shall be reinstated in full force and effect.
Each Subsidiary Guarantor agrees that it shall not be entitled to any
right of subrogation in relation to the Holders of Securities in respect of any
Obligations guaranteed hereby until payment in full of all Obligations
guaranteed hereby. Each Subsidiary Guarantor further agrees that, as between
the Subsidiary 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 Subsidiary Guarantors for the purpose of
this Subsidiary Guarantee. The Subsidiary Guarantors shall have the right to
seek contribution from any non-paying Subsidiary Guarantor so long as the
exercise of such right does not impair the rights of the Holders under the
Subsidiary Guarantees.
SECTION 10.02. EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEE AGREEMENT.
If an Officer of the Subsidiary Guarantor whose signature is on this
Indenture or a Subsidiary Guarantee Agreement no longer holds that office at the
time the Trustee authenticates the related Security, the Subsidiary Guarantee
shall be valid.
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The delivery of any Security by the Trustee, shall constitute due
delivery of the Subsidiary Guarantee set forth in this Indenture or a Subsidiary
Guarantee Agreement on behalf of the Subsidiary Guarantors.
In the event that the Company creates or acquires any new
Subsidiaries, if required by Section 4.20 hereof, the Company and the Trustee
shall, and the Company shall cause such new Subsidiary to, execute a Subsidiary
Guarantee Agreement to this Indenture in accordance with Section 4.20 hereof and
this Article 6, to the extent applicable.
SECTION 10.03. SUBSIDIARY GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
Except as set forth in Articles 4 and 5, nothing contained in this
Indenture or in any of the Securities shall prevent any consolidation or merger
of a Subsidiary Guarantor with or into the Company or another Subsidiary
Guarantor or shall prevent any sale or conveyance of the property of a
Subsidiary Guarantor as an entirety or substantially as an entirety to the
Company or another Subsidiary Guarantor.
SECTION 10.04. EFFECT OF DEFEASANCE.
All Subsidiary Guarantees, whether pursuant to this Indenture or a
Subsidiary Guarantee Agreement, shall be of no further force and effect upon the
occurrence of a legal defeasance or a covenant defeasance, subject to
reinstatement pursuant to Section 8.06 hereof under the circumstances described
therein.
SECTION 10.05. LIMITATION ON SUBSIDIARY GUARANTOR LIABILITY.
Each Subsidiary Guarantor, and by its acceptance of Securities, each
Holder, hereby confirms that it is the intention of all such parties that the
Subsidiary Guarantee of such Subsidiary Guarantor 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 federal or
state law to the extent applicable to any Subsidiary Guarantee. To effectuate
the foregoing intention, the Trustee, the Holders and the Subsidiary Guarantors
hereby irrevocably agree that the obligations of such Subsidiary Guarantor under
the Subsidiary Guarantee, Section 4.20 and this Article 10 shall be limited to
the maximum amount as will, after giving effect to all other contingent and
fixed liabilities of such Subsidiary Guarantor and after giving effect to any
collections from or payments made by or on behalf of any other Subsidiary
Guarantor in respect of the obligations of such other Subsidiary Guarantor under
Section 4.20 or this Article 10, result in the obligations of such Subsidiary
Guarantor under its Subsidiary Guarantee not constituting a fraudulent transfer
or conveyance under federal or state law. Each Subsidiary Guarantor
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that makes a payment or distribution under a Subsidiary Guarantee shall be
entitled to contribution from each other Subsidiary Guarantor in pro rata amount
based on the Adjusted Net Assets of each Subsidiary Guarantor.
SECTION 10.06. STAY, EXTENSION AND USURY LAWS.
Each Subsidiary Guarantor 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 the Subsidiary Guarantee, and each
Subsidiary Guarantor (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 such law has not been enacted.
ARTICLE 11
RESERVE ACCOUNT
SECTION 11.01. ESTABLISHMENT OF RESERVE ACCOUNT.
There is hereby established and there shall be maintained with the
Trustee, for the ratable benefit of the Holders of the Securities, a special
trust account entitled the "XXXXX INTERNATIONAL NETWORKS, LTD. RESERVE ACCOUNT"
(the "Reserve Account") for the purposes of (i) paying principal of or interest
in the Securities and (ii) acquiring subject to compliance with the other
provisions of this Indenture either Persons that become Subsidiaries or assets
which constitute all or substantially all of an operating unit or a business.
The Company has, concurrently with the execution of this Indenture, transferred
to the Trustee for deposit in the Reserve Account an aggregate of
U.S.$10,000,000 in cash. The Company shall solely be responsible for the
payment of any Federal, state, local or other taxes owed or owing in respect of
income or interest earned on the monies deposited in the Reserve Account, and
the Trustee will have no obligation or responsibility to pay any such taxes and
shall not apply any of the funds held in the Reserve Account towards the payment
thereof.
SECTION 11.02. INVESTMENT OF FUNDS IN RESERVE ACCOUNT.
The Trustee shall invest all monies in the Reserve Account, as
directed by the Company, in Cash Equivalents or U.S. Government Obligations.
Pending disbursement of funds from the Reserve Account as contemplated by
Section 11.04 below, the Trustee shall reinvest any interest or other payments
received in respect of such investments, as directed by the Company, in
additional Cash Equivalents or U.S. Government Obligations,
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provided that any monies so reinvested and the securities acquired thereby must
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(i) be held as Reserve Collateral (as defined below) in the Reserve Account,
(ii) be subject to the security interest created by this Article 11, and (iii)
otherwise be subject to the terms hereof. The Trustee shall have no obligation
to select, or liability for its failure to so select, a form of Cash Equivalent
or U.S. Government Obligation for the investment of Reserve Account funds, based
on the rate of return provided by such Cash Equivalent or U.S. Government
Obligation.
SECTION 11.03. PLEDGE AND GRANT OF SECURITY INTEREST.
The Company hereby pledges to the Trustee for its benefit and for the
ratable benefit of the Holders of the Securities, and grants to the Trustee for
its benefit and for the ratable benefit of the Holders of the Securities, a
continuing security interest in and to (i) all of the Company's right, title and
interest in the Reserve Account and any cash or Cash Equivalents or U.S.
Government Obligations deposited therein and (ii) all products and proceeds of
any of the securities held at any time in the Reserve Account, including,
without limitation, all dividends, interest, principal payments, cash, options,
warrants, rights, instruments, subscriptions and other property or proceeds from
time to time received, receivable or otherwise distributed or distributable in
respect of or in exchange for any or all of the monies or securities held in the
Reserve Account (collectively "Reserve Collateral"). The Interest Reserve
Collateral secures the prompt and complete payment and performance when due
(whether at stated maturity, by acceleration or otherwise) of all obligations of
the Company under this Indenture and the Securities.
SECTION 11.04. DISBURSEMENTS.
(a) Not less than five (5) Business Days prior to the date on which
any principal of or interest on the Securities will become due the Company may,
in writing, direct the Trustee to transfer from the Reserve Account to the
Trustee in its capacity as Paying Agent funds necessary to provide for payment
in full or any portion of such amounts. Upon receipt of such written request,
the Trustee will take any action necessary to provide for the payment of such
amounts on the Securities directly to the Holders of the Security from proceeds
of the cash or Cash Equivalents or U.S. Government Obligations in the Reserve
Account.
(b) Not less than five (5) Business Days prior to the date on which
the Company or any Restricted Subsidiary shall acquire, merge or consolidate
with another entity or purchase assets as provided in Section 11.01, the Company
may, in writing, direct the Trustee to transfer from the Reserve Account funds
necessary to provide for payment of all or any portion of the purchase price of
such Subsidiary or assets. Upon receipt of a direction from the Company,
together with any other documentation
94
reasonably satisfactory to the Trustee to substantiate such use of the Reserve
Account by the Company, the Trustee will take any action necessary to enable it
to pay the requested amount upon the order of the Company. Concurrently with any
release of funds pursuant to this Section 11.04(b), the Company will deliver to
the Trustee an Opinion of Counsel stating that such use of funds has been duly
authorized by all necessary corporate action, and does not contravene, or
constitute a default under, any provisions of applicable law or regulation or of
the organizational documents of the Company or of any agreement, judgment,
injunction, order, decree or other instrument binding upon the Company or result
in the creation or imposition of any Lien on any assets of the Company.
ARTICLE 12
MISCELLANEOUS
SECTION 12.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provision shall control. Until such time as this Indenture becomes
qualified under the TIA, the Company, the Subsidiary Guarantors and the Trustee
shall be deemed subject to and governed by the TIA as if the Indenture were so
qualified on the date hereof.
SECTION 12.02. NOTICES.
(a) Any notice or communication by the Company, any Subsidiary
Guarantor or the Trustee to the other is duly given if in writing and delivered
in person or mailed by first class mail (registered or certified, return receipt
requested), confirmed facsimile transmission or overnight air courier
guaranteeing next day delivery, to the other's address:
If to the Company or any of the Subsidiary Guarantors:
Xxxxx International Networks, Ltd.
0000 Xxxx Xxxxxxx Xxxxxx
P.O. Box 3309
Englewood, Colorado 80155-3309
Attention: Chief Financial Officer
If to the Trustee:
U.S. Trust Company of New York
c/o Xxxxxxxx X. Xxxxxxx
Assistant Vice President
000 Xxxxx Xxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000-0000
95
(b) The Company or the Trustee, by notice to the other, may designate
additional or different addresses for subsequent notices or communications.
(c) All notices and communications (other than those sent to
Securityholders) 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 receipt acknowledged, if by facsimile
transmission; and the next Business Day after timely delivery to the courier, if
sent by overnight air courier guaranteeing next day delivery.
(d) Any notice or communication to a Securityholder shall be mailed
by first class mail, postage prepaid, 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 (S) 313(c), to the extent required by the TIA. Failure
to mail a notice or communication to a Securityholder or any defect in it shall
not affect its sufficiency with respect to other Securityholders.
(e) If a notice or communication is mailed to any Person in the
manner provided above within the time prescribed, it is duly given, whether or
not the addressee receives it.
(f) If the Company mails a notice or communication to
Securityholders, it shall mail a copy to the Trustee and each Agent at the same
time.
SECTION 12.03. COMMUNICATION BY SECURITYHOLDERS WITH OTHER SECURITYHOLDERS.
Securityholders may communicate pursuant to TIA (S) 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Subsidiary Guarantors, the Trustee, the Registrar
and anyone else shall have the protection of TIA (S) 312(c).
SECTION 12.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company and/or any of the
Subsidiary Guarantors to the Trustee to take any action under this Indenture,
the Company and/or any of the Subsidiary Guarantors, as the case may be, shall
furnish to the Trustee:
(i) an Officer's 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
96
satisfied (except with regard to an authentication order pursuant to
Section 2.02(c) hereof, which shall require a certificate of two Officers);
and
(ii) an Opinion of Counsel 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 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 TIA (S) 314(a)(4)) shall comply with the provisions of TIA
(S) 314(e), shall comply with the definition of the term "Officers' Certificate"
and shall include:
(i) a statement that the person making such certificate or opinion
has read such covenant or condition;
(ii) 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;
(iii) 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 or her covenant or
condition has been satisfied; and
(iv) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been satisfied.
SECTION 12.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting of
Securityholders. The Registrar or Paying Agent may make reasonable rules and
set reasonable requirements for its functions.
SECTION 12.07. LEGAL HOLIDAYS.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions in New York City, N.Y., or at a place of payment are authorized or
obligated 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 for the intervening period.
97
SECTION 12.08. NO RECOURSE AGAINST OTHERS.
No past, present or future director, officer, employee, agent,
manager, stockholder or partner of the Company or any Subsidiary Guarantor or
their respective predecessors shall have any liability for any Obligations of
the Company under the Securities or this Indenture or for any claim based on, in
respect of, or by reason of such Obligations or their creation. Each
Securityholder by accepting a Security waives and releases all such liability.
This waiver and release are part of the consideration for issuance of the
Securities.
SECTION 12.09. DUPLICATE ORIGINALS.
The parties may sign any number of copies of this Indenture. One
signed copy is enough to prove this Indenture.
SECTION 12.10. GOVERNING LAW.
This Indenture and the Securities shall be governed by, and construed
in accordance with, the laws of the State of New York, but without giving effect
to applicable principles of conflicts of law to the extent that the application
of the laws of another jurisdiction would be required thereby.
SECTION 12.11. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of any of the Subsidiary Guarantors, the Company or their
respective Subsidiaries. Any such indenture, loan or debt agreement may not be
used to interpret this Indenture.
SECTION 12.12. SUCCESSORS.
Except as provided herein, all agreements of the Company and the
Subsidiary Guarantors in this Indenture and the Securities shall bind its
successors. All agreements of the Trustee in this Indenture shall bind its
successor.
SECTION 12.13. SEVERABILITY.
In case any provision in this Indenture or in the Securities 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 12.14. COUNTERPART ORIGINALS.
This Indenture may be executed in any number of counterparts, each of
which so executed shall be an original, but all of them together represent the
same agreement.
SECTION 12.15. TABLE OF CONTENTS, HEADINGS, ETC.
98
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.
99
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the date first written above.
SIGNATURES
XXXXX INTERNATIONAL NETWORKS, LTD.
By_________________________________
Name:
Title:
U.S. TRUST COMPANY OF NEW YORK,
as Trustee
By /s/ Xxxxxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxxxxx X. Xxxxxxx
Title: Assistant Vice President
JPN, INC.
By_________________________________
Name:
Title:
XXXXX SPACE HOLDINGS, INC.
By_________________________________
Name:
Title:
XXXXX EARTH SEGMENT, INC.
By_________________________________
Name:
Title:
XXXXX INFOMERCIAL NETWORKS, INC.
By_________________________________
Name:
Title:
XXXXX RADIO HOLDINGS, INC.
By_________________________________
Name:
Title:
GREAT AMERICAN COUNTRY, INC.
By_________________________________
Name:
Title:
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the date first written above.
SIGNATURES
XXXXX INTERNATIONAL NETWORKS, LTD.
By Xxxxxxx X. Xxxxxx
----------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
U.S. TRUST COMPANY OF NEW YORK,
as Trustee
By_________________________________
Name:
Title:
JPN, INC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
XXXXX SPACE HOLDINGS, INC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
XXXXX EARTH SEGMENT, INC.
By /s/ Xxxxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxxxx X. Xxxxxx
Title: Vice President
XXXXX INFOMERCIAL NETWORKS, INC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
XXXXX RADIO HOLDINGS, INC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
GREAT AMERICAN COUNTRY, INC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
99
XXXXX GALACTIC RADIO, INC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Group Vice President
XXXXX INFOMERCIAL NETWORK VENTURES, INC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
XXXXX GALACTIC RADIO PARTNERS, INC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
XXXXX RADIO NETWORK, INC.
By /s/ Xxxxxxxxx Xxxxxx
---------------------------------
Name: Xxxxxxxxx X. Xxxxxx
Title: Vice President
XXXXX AUDIO SERVICES, INC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
XXXXX RADIO NETWORK VENTURES, INC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
XXXXX/XXXXX RADIO PROGRAMMING, LLC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
XXXXX XXX, INC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
XXXXX XXX RADIO, INC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
100
EXHIBITS
--------
Exhibit A-1 Form of Note
Exhibit A-2 Form of Regulation S Temporary Global Notes
Exhibit A-3 Form of Exchange Senior Secured Note
Exhibit B-1 Form of Certificate For Registration of Transfer From Restricted
Global Note to Regulation S Global Note
Exhibit B-2 Form of Certificate For Registration of Transfer From Regulation S
Global Note to Restricted Global Note
Exhibit B-3 Form of Certificate For Exchange or Registration of Transfer of
Certificated Notes
Exhibit B-4 Form of Certificate For Exchange of Restricted Global Note or
Regulation S Permanent Global Note to Certificated Note
Exhibit C Subsidiary Guarantee Agreement.
SCHEDULE
--------
Schedule 1 Liens outstanding immediately after the Issue Date.
-i-
EXHIBIT A-1
FORM OF NOTE
(Face of Note)
XXXXX INTERNATIONAL NETWORKS, LTD.
11 3/4% SENIOR SECURED NOTE DUE 2005, SERIES A
[UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN
DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY, OR BY ANY SUCH NOMINEE OF THE
DEPOSITARY TO ANY OTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR
ANY NOMINEE OF THE DEPOSITARY TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF
SUCH SUCCESSOR DEPOSITARY. TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED
TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN THE INDENTURE.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]/1/
[THIS NOTE AND ITS PREDECESSORS HAVE NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND ACCORDINGLY,
NEITHER THIS NOTE NOR A BENEFICIAL INTEREST HEREIN MAY BE OFFERED, SOLD OR
PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES TO, OR FOR THE
ACCOUNT OR BENEFIT OF, UNITED STATES PERSONS EXCEPT AS SET FORTH IN THE
FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS
THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON, IS NOT ACQUIRING
THIS NOTE FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON AND IS ACQUIRING THIS
NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE
SECURITIES ACT, (2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD
REFERRED TO IN RULE 144(k) UNDER THE SECURITIES ACT AS IN EFFECT WITH
RESPECT TO SUCH TRANSFER, RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A)
TO XXXXX INTERNATIONAL NETWORKS, LTD. OR ANY SUBSIDIARY THEREOF, (B) INSIDE
THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH
RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN
INSTITUTIONAL ACCREDITED INVESTOR (AS DEFINED IN RULE 501(a)(1),(2),(3) OR
______________
/1/ To be included only if the Security is issued in global form.
A-1-1
(7) UNDER THE SECURITIES ACT) THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO
THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS NOTE (THE FORM
OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), AND IF SUCH TRANSFER IS
IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES AT THE TIME OF
TRANSFER OF LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO XXXXX
INTERNATIONAL NETWORKS, LTD. THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT, (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT
(IF AVAILABLE), (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OR (G) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (BASED UPON AN OPINION OF
COUNSEL ACCEPTABLE TO XXXXX INTERNATIONAL NETWORKS, LTD.) AND, IN EACH
CASE, IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS AND (3) AGREES THAT IT
WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS USED HEREIN, THE TERMS
"OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS
GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES ACT. THE
INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER
ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING RESTRICTIONS.
A HOLDER OF THIS NOTE SHALL HAVE ALL THE RIGHTS SET FORTH IN THE
REGISTRATION RIGHTS AGREEMENT.]/2/
___________________
/2/ To be included on the Initial Senior Secured Securities and omitted from
the Exchange Senior Secured Securities.
A-1-2
XXXXX INTERNATIONAL NETWORKS, LTD.
11 3/4% SENIOR SECURED NOTE DUE 2005, SERIES A
No. 1 $100,000,000
Record Dates: June 15 and December 15 CUSIP No. 000000XX0
Interest Payment Dates: January 1 and July 1, Maturity Date: July 1, 2005
commencing January 1, 1999
XXXXX INTERNATIONAL NETWORKS, LTD., a Colorado corporation (the "Company," which
term includes any successor corporation under the indenture hereinafter referred
to), for value received promises to pay to or registered assigns, the principal
sum of $100,000,000 Dollars on July 1, 2005.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Note shall
not be entitled to any benefits under the Indenture referred to on the reverse
hereof or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this Note to be duly executed
under its corporate seal.
Dated: July 10, 1998
XXXXX INTERNATIONAL NETWORKS, LTD.
By:_________________________
Name: Xxxxxxx X. Xxxxxx
Title: President
By:_________________________
Name: Xxxxxxxxx X. Xxxxxx
Title: Secretary
A-1-3
This is one of the Notes referred to in the
within-mentioned Indenture:
U.S. TRUST COMPANY OF NEW YORK,
as Trustee
By:______________________________
Name:
Title:
A-1-4
(Back of Note)
11 3/4% SENIOR SECURED NOTES DUE 2005, SERIES A
Capitalized terms used herein shall have the meanings assigned to them in
the Indenture referred to below unless otherwise indicated.
1. Interest. Xxxxx International Networks, Ltd., a Colorado
corporation (the "Company"), promises to pay interest on the principal amount of
this Security at the rate and in the manner specified below. The Company shall
pay, in cash, interest on the principal amount of this Security at the rate per
annum of 11 3/4%. The Company will pay interest semiannually in arrears on
January 1 and July 1 of each year (each an "Interest Payment Date"), commencing
January 1, 1999, or if any such day is not a Business Day on the next succeeding
Business Day. Interest will be computed on the basis of a 360-day year
consisting of twelve 30-day months. Interest shall accrue from the most recent
Interest Payment Date to which interest has been paid or, if no interest has
been paid, from the date of the original issuance of the Securities. To the
extent lawful, the Company shall pay interest on overdue principal at the rate
of 2% per annum in excess of the then applicable interest rate on the
Securities; it shall pay interest on overdue installments of interest (without
regard to any applicable grace periods) at the same rate to the extent lawful.
The rate of interest payable on this Security shall be subject to the assessment
of additional interest (the "Additional Interest") as follows:
(i) if the Exchange Offer Registration Statement (as defined below)
or Shelf Registration Statement (as defined below) is not filed within 45 days
following the Issue Date (the "Filing Date"), Additional Interest shall accrue
on the Securities over and above the stated interest at a rate of 0.50% per
annum for the first 30 days commencing on the 16th day after the Filing Date,
such Additional Interest rate increasing by an additional 0.50% per annum at the
beginning of each subsequent 30-day period;
(ii) if the Exchange Offer Registration Statement or Shelf
Registration Statement is not declared effective within 75 days following the
Filing Date, Additional Interest shall accrue on the Securities over and above
the stated interest at a rate of 0.50% per annum for the first 30 days
commencing on the 76th day after the Filing Date, such Additional Interest rate
increasing by an additional 0.50% per annum at the beginning of each subsequent
90-day period; or
(iii) if (A) the Company and the Subsidiary Guarantors have not
exchanged all Securities validly tendered in accordance with the terms of the
Exchange Offer on or prior to 135 days after the Filing Date or (B) the Exchange
Offer Registration Statement ceases to be effective at any time prior to the
time that the Exchange Offer is consummated or (C) if applicable, the Shelf
Registration Statement has been declared effective and such Shelf Registration
Statement ceases to be effective at any time prior to the second anniversary of
the Issue Date (unless all the Securities have been sold thereunder), then
Additional Interest shall accrue on the Securities over and above the stated
interest at a rate of 0.50% per annum for the first 90 days commencing on (x)
the 136th day after the Filing Date with respect to the Securities validly
tendered and not exchanged by the Company, in the case of (A) above, or (y) the
day the Exchange Offer Registration Statement ceases to be effective or usable
for its intended purpose in the case of (B) above, or (z) the day such Shelf
Registration Statement ceases to be effective in the case of (C) above, such
Additional Interest rate increasing by an additional 0.50% per annum at the
beginning of each subsequent 90-day period; provided, however, that the
Additional Interest rate on the Securities under clauses (i), (ii) and (iii)
above may not exceed in the aggregate 2.0% per annum; and provided further, that
(1) upon the filing of the Exchange Offer Registration Statement or Shelf
Registration Statement (in the case of clause (i) above), (2) upon the
effectiveness of the Exchange Offer Registration Statement or Shelf Registration
Statement (in the case of (ii) above), or (3) upon the exchange of Exchange
Securities for all Securities tendered (in the case of clause (iii)(A) above),
or upon the effectiveness of the Exchange Offer Registration Statement which had
ceased to remain effective (in the case of clause (iii)(B) above), or upon the
effectiveness of the Shelf Registration Statement which had ceased to remain
effective (in the case of clause (iii)(C) above), Additional Interest on the
Securities as a result of such clause (or the relevant subclause thereof), as
the case may be, shall cease to accrue.
A-1-5
"Exchange Offer" shall mean the exchange offer by the Company of
Initial Securities for Exchange Securities pursuant to Section 2(a) of the
Registration Rights Agreement.
"Exchange Offer Registration Statement" shall mean an exchange offer
registration statement on Form S-4 (or, if applicable, on another appropriate
form) and all amendments and supplements to such registration statement, in each
case including the Offering Memorandum or prospectus contained therein, all
exhibits thereto and all material incorporated by reference therein.
"Record Date" shall have the meaning provided on the front of this
Security.
"Shelf Registration Statement" shall mean a "shelf" registration
statement of the Company and the Subsidiary Guarantors pursuant to the
provisions of the Registration Rights Agreement which covers all of the Initial
Securities on an appropriate form under Rule 415 under the Securities Act, or
any similar rule that may be adopted by the Commission, and all amendments and
supplements to such registration statement, including post-effective amendments,
in each case including the Offering Memorandum contained therein, all exhibits
thereto and all material incorporated by reference therein.
2. Method of Payment. The Company shall pay interest on the
Securities (except defaulted interest) to the Persons who are registered Holders
of Securities at the close of business on the Record Date immediately preceding
the Interest Payment Date, even if such Securities are canceled after such
Record Date and on or before such Interest Payment Date. Securityholders must
surrender Securities to a Paying Agent to collect principal payments. The
Company shall
A-1-6
pay principal, premium, if any, and interest in monies of the
United States that at the time of payment is legal tender for payment of public
and private debts ("U.S. Legal Tender"). However, the Company may pay
principal, premium, if any, and interest by its check payable in such U.S. Legal
Tender. The Company may deliver any such interest payment to the Paying Agent
or to a Securityholder at the Securityholder's registered address.
3. Paying Agent and Registrar. Initially, the Trustee will act as
Paying Agent and Registrar. The Company may change any Paying Agent, Registrar
or co-registrar without prior notice to any Securityholder. The Company or any
Guarantor of the Company may act in any such capacity, except that none of the
Company, its Subsidiaries or their Affiliates shall act (i) as Paying Agent in
connection with any redemption, offer to purchase, discharge or defeasance, as
otherwise specified in the Indenture, and (ii) as Paying Agent or Registrar if a
Default or Event of Default has occurred and is continuing.
4. Indenture. The Company issued the Securities under an Indenture,
dated as of July 10, 1998 (the "Indenture"), between the Company and the
Trustee. The terms of the Securities include those stated in the Indenture and
those made part of the Indenture by reference to the TIA as in effect on the
date the Indenture is qualified. The Securities are subject to all such terms,
and Securityholders are referred to the Indenture and the TIA for a statement of
such terms. The terms of the Indenture shall govern any inconsistencies between
the Indenture and the Securities. The Securities are senior Obligations of the
Company limited to $100,000,000 in aggregate principal amount.
5.(a) Optional Redemption. Except as indicated in the next
succeeding paragraph, the Securities are not redeemable at the Company's option
prior to July 1, 2003. Thereafter, the Securities will be redeemable, at the
option of the Company, in whole or in part, at the redemption prices (expressed
as percentages of the principal amount of the Securities) set forth below, plus
accrued interest to the redemption date:
PERIOD REDEMPTION PRICE
------ ----------------
2003........................ 105.875%
2004 and thereafter 100.000%
(b) Optional Redemption Upon Equity Offerings. At any time, or from
time to time, on or prior to July 1, 2001, the Company may, at its option, use
the Net Cash Proceeds of one or more Equity Offerings by the Company at a
redemption price equal to 111.75% of the principal amount thereof, plus accrued
and unpaid interest thereon, if any, to the date of redemption; provided,
however, that after any such redemption, the aggregate principal amount of the
Securities outstanding must equal at least 65% of the aggregate principal amount
of the Securities issued under the Indenture; and provided further, that the
Company may not so redeem the Securities in connection with a Change of Control.
In order to effect the foregoing
A-1-7
redemption with the proceeds of any Equity Offering, the Company shall make such
redemption not more than 90 days after the consummation of any such Equity
Offering.
6. Mandatory Redemption. The Securities are not subject to mandatory
redemption or sinking fund payments.
7. Repurchase at Option of Securityholder. (a) If there is a Change
of Control, each Holder of Securities will have the right to require the Company
to repurchase all or any part of such Holder's Securities at a repurchase price
equal to 101% of the principal amount thereof, plus accrued and unpaid interest,
if any, to the date of repurchase (subject to the right of Holders of record on
the relevant Record Date to receive interest due on the relevant Interest
Payment Date). Within 30 days following any Change of Control, the Company will
mail a notice to each Securityholder stating (i) that a Change of Control has
occurred and that such Securityholder has the right to require the Company to
repurchase all or any part of such Securityholder's Securities at a repurchase
price in cash equal to 101% of the principal amount thereof plus accrued and
unpaid interest, if any, to the date of repurchase (subject to the right of
Holders of record on the relevant Record Date to receive interest due on the
relevant Interest Payment Date); (ii) the circumstances and relevant facts
regarding such Change of Control (including information with respect to pro
forma historical income, cash flow and capitalization after giving effect to
such Change of Control); (iii) the repurchase date (which will be no earlier
then 30 days nor later than 60 days from the date such notice is mailed); and
(iv) the procedures, determined by the Company consistent with the Indenture,
that a Securityholder must follow in order to have its Securities repurchased.
Securityholders that are subject to an offer to repurchase may elect to have
such Securities repurchased by completing the form entitled "Option of
Securityholder to Elect Purchase" appearing below.
(b) If the Company or a Subsidiary consummates any Asset Disposition,
and the aggregate amount of Net Available Cash remaining from such an Asset
Disposition after any repayment of Senior Indebtedness or purchase of Additional
Assets exceeds $5 million, the Company shall be required to offer to purchase
the maximum principal amount of Securities, that is in an integral multiple of
$1,000, that may be purchased out of the Net Available Cash at 101% of the
principal amount thereof, plus accrued and unpaid interest, if any, to the date
fixed for the closing of such offer in accordance with the procedures set forth
in the Indenture (subject to the right of Holders of record on the relevant
Record Date to receive interest due on the relevant Interest Payment Date). If
the aggregate principal amount of Securities surrendered by Holders thereof
exceeds the amount of Net Available Cash, the Securities to be redeemed shall be
selected on a pro rata basis. Securityholders that are the subject of an offer
to purchase will receive an Asset Disposition Offer from the Company prior to
any related purchase date and may elect to have such Securities purchased by
completing the form entitled "Option of Securityholder to Elect Purchase"
appearing below.
8. Notice of Redemption. Notice of redemption shall be mailed at
least 30 (unless a shorter period is acceptable to the Trustee) but not more
than 60 days before the redemption date to each Holder whose Securities are to
be redeemed at its registered address. Securities may
A-1-8
be redeemed in part but only in whole multiples of $1,000, unless all of the
Securities held by a Securityholder are to be redeemed. On and after the
redemption date, interest ceases to accrue on Securities or portions of them
called for redemption.
9. Registration Rights. Pursuant to the Registration Rights
Agreement, and subject to certain terms and conditions stated therein, the
Company will be obligated to consummate an Exchange Offer pursuant to which the
Holders of the Initial Securities shall have the right to exchange this Security
for Exchange Securities, which have been registered under the Securities Act, in
like principal amount and having terms identical in all material respects to the
Initial Securities.
10. Denominations, Transfer, Exchange. The Securities are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Securities may be registered and
Securities may be exchanged as provided in the Indenture. The Registrar and the
Trustee may require a Securityholder among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not exchange or register
the transfer of any Security or portion of a Security selected for redemption.
Also, it need not exchange or register the transfer of any Securities during a
period beginning at the opening of business on a Business Day 15 days before the
day of any selection of Securities to be redeemed and ending at the close of
business on the day of selection or during the period between a Record Date and
the corresponding Interest Payment Date.
11. Persons Deemed Owners. Prior to due presentment to the Trustee
for registration of the transfer of this Security, the Trustee, any Agent and
the Company may deem and treat the Person in whose name this Security is
registered as its absolute owner for the purpose of receiving payment of
principal of and premium, if any, and interest on, this Security and for all
other purposes whatsoever, whether or not this Security is overdue, and neither
the Trustee, any Agent nor the Company shall be affected by notice to the
contrary. The registered Securityholder shall be treated as its owner for all
purposes.
12. Amendments and Waivers. Subject to certain exceptions provided
in the Indenture, the Indenture or the Securities may be amended with the
consent of the Holders of a majority in principal amount of the then outstanding
Securities, and any existing Default or Event of Default (except a payment
default) may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Securities. Without the consent of any
Securityholder, the Indenture or the Securities may be amended to, among other
things, cure any ambiguity, defect or inconsistency, to comply with the
requirements of the Commission in order to effect or maintain qualification of
the Indenture under the TIA or to make any change that does not adversely affect
the rights of any Securityholder.
13. Defaults and Remedies. If an Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the then outstanding Securities may declare the unpaid principal of, and any
accrued and unpaid interest on, all the Securities to be due and payable
immediately; provided, that in the case of an Event of Default arising from
certain events of bankruptcy or insolvency with respect to the Company or any
Significant Subsidiary, all outstanding Securities shall become due and payable
immediately without further action or notice. Securityholders may not enforce
the Indenture or the Securities
A-1-9
except as provided in the Indenture. The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Securities. Subject
to certain limitations, Holders of a majority in principal amount of the then
outstanding Securities may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Securityholders notice of any continuing
default (except a default in payment of any amount due) if it determines that
withholding notice is in their interests. The Company must furnish an annual
compliance certificate to the Trustee.
14. Trustee Dealings with the Company. The Trustee under the
Indenture, in its individual or any other capacity may make loans to, accept
deposits from, and perform services for the Company, the Subsidiary Guarantors
or any Affiliate of the Company or the Subsidiary Guarantors, and may otherwise
deal with the Company, the Subsidiary Guarantors and their respective Affiliates
as if it were not Trustee.
15. Restrictive Covenants. The Indenture imposes certain limitations
on the ability of the Company and its Restricted Subsidiaries to, among other
things, incur additional Indebtedness, make payments in respect of its Capital
Stock or certain Indebtedness, enter into transactions with Affiliates, create
dividend or other payment restrictions affecting Subsidiaries, merge or
consolidate with any other Person, sell, assign, transfer, lease, convey or
otherwise dispose of all or substantially all of its assets or adopt a plan of
liquidation. Such limitations are subject to a number of important
qualifications and exceptions provided for in the Indenture. The Company must
annually report to the Trustee on compliance with such limitations.
16. Authentication. This Security shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
17. Subsidiary Guarantees. Each Subsidiary Guarantor has jointly and
severally irrevocably and unconditionally guaranteed the payment of all amounts
(including interest on overdue principal and overdue interest, if lawful) due on
the Securities; provided, however, each Subsidiary Guarantor that makes a
payment or distribution under a Subsidiary Guarantee shall be entitled to a
contribution from each other Guarantor in a pro rata amount based on the
Adjusted Net Assets of each Subsidiary Guarantor.
18. Defeasance. Subject to certain conditions provided for in the
Indenture, the Company at any time may terminate some or all of its obligations
under the Securities and the Indenture if the Company deposits with the Trustee
money or U.S. Government Obligations for the payment of principal, premium (if
any) and interest on the Securities to redemption or maturity, as the case may
be.
19. Governing Law. The laws of the State of New York shall govern
this Security and the Indenture, without regard to principles of conflict of
laws.
20. Abbreviations. Customary abbreviations may be used in the name
of a Securityholder or an assignee, such as: TEN COM (= tenants in common), TEN
ENT (= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).
A-1-10
21. 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 Securities and has directed the Trustee to
use CUSIP numbers in notices of redemption as a convenience to Securityholders.
No representation is made as to the accuracy of such numbers either as printed
on the Securities 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 Securityholder upon written request
and without charge a copy of the Indenture. Request may be made to:
Xxxxx International Networks, Ltd.
0000 Xxxx Xxxxxxx Xxxxxx
P.O. Box 3309
Englewood, Colorado 80155-3309
Attn: Chief Financial Officer
A-1-11
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to:
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
agent to transfer this 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 Note)
Signature Guarantee:_____________________________________________________
(Participant in recognized signature guarantee
medallion program)
A-1-12
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to elect to have all or any portion of this Note purchased by
the Company pursuant to Section 4.10 ("Asset Sale Offer") or Section 4.14
("Change of Control Offer") of the Indenture, check the applicable boxes:
[_] Asset Sale Offer: [_] Change of Control Offer:
in whole [_] in whole [_]
in part [_] in part [_]
Amount to be Amount to be
purchased: $___________ purchased: $___________
Dated:____________________ Signature: ___________________________
(Sign exactly as your name
appears on the other side of
this Note)
Signature
Guarantee:______________________________________________________________________
(Participant in recognized signature guarantee medallion program)
Social Security Number or
Taxpayer Identification Number:_________________________________________________
A-1-13
SCHEDULE OF EXCHANGES FOR EXCHANGE NOTE
OR ANOTHER GLOBAL NOTE/3/
The following exchanges of a part of this Global Note for Certificated
Notes or another Global Note have been made:
Principal Xxxxxx
Xxxxxx of decrease Amount of increase of this Global Signature of
in Principal in Principal Note following authorized officer
Amount of this Amount of this such decrease (or of Trustee or Note
Date of Exchange Global Note Global Note increase) Custodian
---------------- ---------------- ------------------ ------------------ --------------------
____________________
/3/ This should be included only if the Security is issued in global form.
A-1-14
EXHIBIT A-2
FORM OF REGULATION S TEMPORARY NOTE
(Face of Note)
XXXXX INTERNATIONAL NETWORKS, LTD.
11 3/4% SENIOR SECURED NOTE DUE 2005, SERIES A
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY, OR BY ANY SUCH NOMINEE OF THE DEPOSITARY TO ANY OTHER
NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY NOMINEE OF THE DEPOSITARY
TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. TRANSFERS
OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND
TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO.
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
THIS NOTE AND ITS PREDECESSORS HAVE NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND ACCORDINGLY,
NEITHER THIS NOTE NOR A BENEFICIAL INTEREST HEREIN MAY BE OFFERED, SOLD OR
PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES TO, OR FOR THE
ACCOUNT OR BENEFIT OF, UNITED STATES PERSONS EXCEPT AS SET FORTH IN THE
FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT
(A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON, IS NOT ACQUIRING THIS NOTE FOR
THE ACCOUNT OR BENEFIT OF A U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN
OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT,
(2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO IN RULE 144(k)
UNDER THE SECURITIES ACT AS IN EFFECT WITH RESPECT TO SUCH TRANSFER, RESELL OR
OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO XXXXX INTERNATIONAL NETWORKS, LTD. OR
ANY SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES TO A QUALIFIED
INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C)
INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED INVESTOR (AS DEFINED IN
RULE 501(a)(1),(2),(3) OR (7) UNDER THE SECURITIES ACT) THAT, PRIOR TO SUCH
TRANSFER, FURNISHES TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS
NOTE (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), AND IF SUCH
TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF
A-2-1
NOTES AT THE TIME OF TRANSFER OF LESS THAN $250,000, AN OPINION OF COUNSEL
ACCEPTABLE TO XXXXX INTERNATIONAL NETWORKS, LTD. THAT SUCH TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT, (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E) PURSUANT
TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT
(IF AVAILABLE), (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OR (G) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (BASED UPON AN OPINION OF COUNSEL ACCEPTABLE
TO XXXXX INTERNATIONAL NETWORKS, LTD.) AND, IN EACH CASE, IN ACCORDANCE WITH
APPLICABLE SECURITIES LAWS AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO
WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND
"U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER
THE SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO
REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING
RESTRICTIONS.
A HOLDER OF THIS NOTE SHALL HAVE ALL THE RIGHTS SET FORTH IN THE REGISTRATION
RIGHTS AGREEMENT.
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN).
THIS REGULATION S TEMPORARY GLOBAL NOTE IS EXCHANGEABLE IN WHOLE OR IN PART FOR
ONE OR MORE REGULATION S PERMANENT GLOBAL NOTES OR A QIB RESTRICTED NOTE ONLY
(i) AFTER THE TERMINATION OF THE RESTRICTED PERIOD (AS DEFINED IN REGULATION S)
AND (ii) UPON PRESENTATION OF CERTIFICATES REQUIRED BY ARTICLE 2 OF THE
INDENTURE. UPON EXCHANGE OF THIS REGULATION S TEMPORARY GLOBAL NOTE FOR ONE OR
MORE REGULATION S PERMANENT GLOBAL NOTES OR QIB RESTRICTED NOTES, THE TRUSTEE
SHALL CANCEL THIS REGULATION S TEMPORARY GLOBAL NOTE.
A-2-2
XXXXX INTERNATIONAL NETWORKS, LTD.
11 3/4% SENIOR SECURED NOTE DUE 2005, SERIES A
No. __________ $_______________
Record Dates: June 15 and December 15 CUSIP No. _______________
Interest Payment Dates: January 1 and July 1, Maturity Date: July 1, 2005
commencing January 1, 1999
XXXXX INTERNATIONAL NETWORKS, LTD., a Colorado corporation (the "Company,"
which term includes any successor corporation under the indenture hereinafter
referred to), for value received promises to pay to ___________________________
or registered assigns, the principal sum of ________________ Dollars on July 1,
2005.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Note shall
not be entitled to any benefits under the Indenture referred to on the reverse
hereof or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this Note to be duly executed
under its corporate seal.
[SEAL] Dated:
XXXXX INTERNATIONAL NETWORKS, LTD.
By:_________________________
Name:
Title:
By:_________________________
Name:
Title:
This is one of the Notes referred to in the within-mentioned Indenture:
U.S. TRUST COMPANY OF NEW YORK,
as Trustee
By:______________________________
Name:
Title:
A-2-3
SCHEDULE OF EXCHANGES FOR GLOBAL NOTES
The following exchanges of a part of this Regulation S Temporary
Global Note for other Global Notes have been made:
Principal Xxxxxx
Xxxxxx of decrease Amount of increase of this Global Signature of
in Principal in Principal Note following authorized officer
Amount of this Amount of this such decrease (or of Trustee or Note
Date of Exchange Global Note Global Note increase) Custodian
------------------ -------------------- ------------------- ------------------ -------------------
A-2-4
EXHIBIT A-3
FORM OF EXCHANGE SENIOR SECURED NOTE
(Face of New Note)
XXXXX INTERNATIONAL NETWORKS, LTD.
11 3/4% % SENIOR SECURED NOTE DUE 2005, SERIES B
[UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY, OR BY ANY SUCH NOMINEE OF THE DEPOSITARY TO ANY OTHER
NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY NOMINEE OF THE DEPOSITARY
TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. TRANSFERS
OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND
TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO.
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.]/4/
____________________
/4/ To be included only if the Security is issued in global form.
A-3-1
XXXXX INTERNATIONAL NETWORKS, LTD.
11 3/4% SENIOR SECURED NOTE DUE 2005, SERIES B
No. __________ $_______________
Record Dates: June 15 and December 15 CUSIP No. _______________
Interest Payment Dates: January 1 and July 1, Maturity Date: July 1, 2005
commencing January 1, 1999
XXXXX INTERNATIONAL NETWORKS, LTD., a Colorado corporation (the "Company,"
which term includes any successor corporation under the indenture hereinafter
referred to), for value received promises to pay to __________________________
or registered assigns, the principal sum of ___________________ Dollars on July
1, 2005.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Note shall
not be entitled to any benefits under the Indenture referred to on the reverse
hereof or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this Note to be duly executed
under its corporate seal.
[SEAL] XXXXX INTERNATIONAL NETWORKS, LTD.
By:_________________________
Name:
Dated: ____________ Title:
By:_________________________
Name:
Title:
This is one of the Notes referred to in the within-mentioned Indenture:
U.S. TRUST COMPANY OF NEW YORK,
as Trustee
By:______________________________
Name:
Title:
A-3-2
(Back of Note)
11 3/4% SENIOR SECURED NOTES DUE 2005, SERIES B
Capitalized terms used herein shall have the meanings assigned to them in
the Indenture referred to below unless otherwise indicated.
1. Interest. Xxxxx International Networks, Ltd., a Colorado
corporation (the "Company"), promises to pay interest on the principal amount of
this Security at the rate and in the manner specified below. The Company shall
pay, in cash, interest on the principal amount of this Security at the rate per
annum of 11 3/4%. The Company will pay interest semiannually in arrears on
January 1 and July 1 of each year (each an "Interest Payment Date"), commencing
January 1, 1999, or if any such day is not a Business Day on the next succeeding
Business Day. Interest will be computed on the basis of a 360-day year
consisting of twelve 30-day months. Interest shall accrue from the most recent
Interest Payment Date to which interest has been paid or, if no interest has
been paid, from the date of the original issuance of the Securities. To the
extent lawful, the Company shall pay interest on overdue principal at the rate
of 2% per annum in excess of the then applicable interest rate on the
Securities; it shall pay interest on overdue installments of interest (without
regard to any applicable grace periods) at the same rate to the extent lawful.
2. Method of Payment. The Company shall pay interest on the
Securities (except defaulted interest) to the Persons who are registered
Securityholders at the close of business on the Record Date immediately
preceding the Interest Payment Date, even if such Securities are canceled after
such Record Date and on or before such Interest Payment Date. Securityholders
must surrender Securities to a Paying Agent to collect principal payments. The
Company shall pay principal premium, if any, and interest in money of the United
States that at the time of payment is legal tender for payment of public and
private debts ("U.S. Legal Tender"). However, the Company may pay principal and
interest by its check payable in such U.S. Legal Tender. The Company may
deliver any such interest payment to the Paying Agent or to a Securityholder at
the Securityholder's registered address.
3. Paying Agent and Registrar. Initially, the Trustee will act as
Paying Agent and Registrar. The Company may change any Paying Agent, Registrar
or co-registrar without prior notice to any Securityholder. The Company, or any
Subsidiary Guarantor of the Company may act in any such capacity, except that
none of the Company, its Subsidiaries or their Affiliates shall act (i) as
Paying Agent in connection with any redemption, offer to purchase, discharge or
defeasance, as otherwise specified in the Indenture, and (ii) as Paying Agent or
Registrar if a Default or Event of Default has occurred and is continuing.
4. Indenture. The Company issued the Securities under an Indenture,
dated as of July 10, 1998 (the "Indenture"), between the Company and the
Trustee. The terms of the Securities include those stated in the Indenture and
those made part of the Indenture by reference to the TIA as in effect on the
date the Indenture is qualified. The Securities are subject to all such terms,
and Securityholders are referred to the Indenture and the TIA for a statement of
such terms. The terms of the Indenture shall govern any inconsistencies between
the Indenture and the Securities. The Securities are senior Obligations of the
Company limited to $100,000,000 in aggregate principal amount.
A-3-3
5. (a) Optional Redemption. Except as indicated in the next
succeeding paragraph, the Securities are not redeemable at the Company's option
prior to July 1, 2003. Thereafter, the Securities will be redeemable, at the
option of the Company, in whole or in part, at the redemption prices (expressed
as percentages of the principal amount of the Securities) set forth below, plus
accrued interest to the redemption date:
PERIOD REDEMPTION PRICE
------ ----------------
2003.......................... 105.875%
2004 and thereafter 100.00%
(b) Optional Redemption Upon Equity Offerings. At any time, or from
time to time, on or prior to July 1, 2001, the Company may, at its option, use
the Net Cash Proceeds of one or more Equity Offerings by the Company at a
redemption price equal to 111.75% of the principal amount thereof, plus accrued
and unpaid interest thereon, if any, to the date of redemption; provided,
however, that after any such redemption, the aggregate principal amount of the
Securities outstanding must equal at least 65% of the aggregate principal amount
of Securities issued under the Indenture and provided further, that the Company
may not so redeem the Securities in connection with a Change of Control. In
order to effect the foregoing redemption with the proceeds of any Equity
Offering, the Company shall make such redemption not more than 90 days after the
consummation of any such Equity Offering.
6. Mandatory Redemption. The Securities are not subject to mandatory
redemption or sinking fund payments.
7. Repurchase at Option of Securityholder. (a) If there is a Change
of Control, each Holder of Securities will have the right to require the Company
to repurchase all or any part of such Holder's Securities at a repurchase price
equal to 101% of the principal amount thereof, plus accrued and unpaid interest,
if any, to the date of repurchase (subject to the right of Holders of record on
the relevant Record Date to receive interest due on the relevant Interest
Payment Date). Within 30 days following any Change of Control, the Company will
mail a notice to each Securityholder stating (i) that a Change of Control has
occurred and that such Securityholder has the right to require the Company to
repurchase all or any part of such Securityholder's Securities at a repurchase
price in cash equal to 101% of the principal amount thereof plus accrued and
unpaid interest, if any, to the date of repurchase (subject to the right of
Holders of record on the relevant Record Date to receive interest due on the
relevant Interest Payment Date); (ii) the circumstances and relevant facts
regarding such Change of Control (including information with respect to pro
forma historical income, cash flow and capitalization after giving effect to
such Change of Control; (iii) the repurchase date (which will be no earlier then
30 days nor later than 60 days from the date such notice is mailed); and (iv)
the procedures, determined by the Company consistent with the Indenture, that a
Securityholder must follow in order to have its
A-3-4
Securities repurchased. Securityholders that are subject to an offer to
repurchase may elect to have such Securities repurchased by completing the form
entitled "Option of Securityholder to Elect Purchase" appearing below.
(b) If the Company or a Subsidiary consummates any Asset Disposition,
and the aggregate amount of Net Available Cash remaining from such an Asset
Disposition after any repayment of Senior indebtedness of purchase of Additional
Assets exceeds $5 million, the Company shall be required to offer to purchase
the maximum principal amount of Securities, that is in an integral multiple of
$1,000, that may be purchased out of the Net Available Cash, at an offer price
in cash in an amount equal to 101% of the outstanding principal amount thereof,
plus accrued and unpaid interest, if any, to the date fixed for the closing of
such offer in accordance with the procedures set forth in the Indenture (subject
to the right of Holders of record on the relevant Record Date to receive
interest due on the relevant Interest Payment Date). If the aggregate principal
amount of Securities surrendered by Holders thereof exceeds the amount of Net
Available Cash, the Securities to be redeemed shall be selected on a pro rata
basis. Securityholders that are the subject of an offer to purchase will
receive an Asset Disposition Offer from the Company prior to any related
purchase date and may elect to have such Securities purchased by completing the
form entitled "Option of Securityholder to Elect Purchase" appearing below.
8. Notice of Redemption. Notice of redemption shall be mailed at
least 30 days (unless a shorter period is acceptable to the Trustee) but not
more than 60 days before the redemption date to each Holder whose Securities are
to be redeemed at its registered address. Securities may be redeemed in part
but only in whole multiples of $1,000, unless all of the Securities held by a
Securityholder are to be redeemed. On and after the redemption date, interest
ceases to accrue on Securities or portions of them called for redemption.
9. Denominations, Transfer, Exchange. The Securities are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Securities may be registered and
Securities may be exchanged as provided in the Indenture. The Registrar and the
Trustee may require a Securityholder among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not exchange or register
the transfer of any Security or portion of a Security selected for redemption.
Also, it need not exchange or register the transfer of any Securities during a
period beginning on the opening of business on a Business Day 15 days before the
day of any selection of Securities to be redeemed and ending on the close of
business on the day of selection or during the period between a Record Date and
the corresponding Interest Payment Date.
10. Persons Deemed Owners. Prior to due presentment to the Trustee
for registration of the transfer of this Security, the Trustee, any Agent and
the Company may deem and treat the Person in whose name this Security is
registered as its absolute owner for the purpose of receiving payment of
principal of and premium, if any, and interest on, this Security and for all
other purposes whatsoever, whether or not this Security is overdue, and neither
the Trustee, any Agent nor the Company shall be affected by notice to the
contrary. The registered Securityholder shall be treated as its owner for all
purposes.
A-3-5
11. Amendments and Waivers. Subject to certain exceptions provided
in the Indenture, the Indenture or the Securities may be amended with the
consent of the Holders of a majority in principal amount of the then outstanding
Securities, and any existing default or Event of Default (except a payment
default) may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Securities. Without the consent of any
Securityholder, the Indenture or the Securities may be amended to, among other
things, cure any ambiguity, defect or inconsistency, to comply with the
requirements of the Commission in order to effect or maintain qualification of
the Indenture under the TIA Securityholders or to make any change that does not
adversely affect the rights of any Securityholder.
12. Defaults and Remedies. If an Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the then outstanding Securities may declare the unpaid principal of, and any
accrued and unpaid interest on, all the Securities to be due and payable
immediately; provided, that in the case of an Event of Default arising from
certain events of bankruptcy or insolvency with respect to the Company or any
Significant Subsidiary, all outstanding Securities shall become due and payable
immediately without further action or notice. Securityholders may not enforce
the Indenture or the Securities except as provided in the Indenture. The
Trustee may require indemnity satisfactory to it before it enforces the
Indenture or the Securities. Subject to certain limitations, Holders of a
majority in principal amount of the then outstanding Securities may direct the
Trustee in its exercise of any trust or power. The Trustee may withhold from
Securityholders notice of any continuing default (except a default in payment of
any amount) if it determines that withholding notice is in their interests. The
Company must furnish an annual compliance certificate to the Trustee.
13. Trustee Dealings with the Company. The Trustee under the
Indenture, in its individual or any other capacity may make loans to, accept
deposits from, and perform services for the Company, the Subsidiary Guarantor or
any Affiliate of the Company or the Subsidiary Guarantor, and may otherwise deal
with the Company, the Subsidiary Guarantors and their respective Affiliates as
if it were not Trustee.
14. Restrictive Covenants. The Indenture imposes certain limitations
on the ability of the Company and its Restricted Subsidiaries to, among other
things, incur additional Indebtedness, make payments in respect of its Capital
Stock or certain Indebtedness, enter into transactions with Affiliates, create
dividend or other payment restrictions affecting Subsidiaries, merge or
consolidate with any other Person, sell, assign, transfer, lease, convey or
otherwise dispose of all or substantially all of its assets or adopt a plan of
liquidation. Such limitations are subject to a number of important
qualifications and exceptions provided for in the Indenture. The Company must
annually report to the Trustee on compliance with such limitations.
15. Authentication. This Security shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
16. Subsidiary Guarantees. Each Subsidiary Guarantor has jointly and
severally irrevocably and unconditionally guaranteed the payment of all amounts
(including interest on overdue principal and overdue interest, if lawful) due on
the Securities; provided, however, each Subsidiary Guarantor that makes a
payment or distribution under a Subsidiary Guarantee shall be entitled to a
contribution from each
A-3-6
other Subsidiary Guarantor in a pro rata amount based on the Adjusted Net Assets
of each Subsidiary Guarantor.
17. Defeasance. Subject to certain conditions provided for in the
Indenture, the Company at any time may terminate some or all of its obligations
under the Securities and the Indenture if the Company deposits with the Trustee
money or U.S. Government Obligations for the payment of principal, premium (if
any) and interest on the Securities to redemption or maturity, as the case may
be.
18. Governing Law. The laws of the State of New York shall govern
this Security and the Indenture, without regard to principles of conflict of
laws.
19. Abbreviations. Customary abbreviations may be used in the name
of a Securityholder or an assignee, such as: TEN COM (= tenants in common), TEN
ENT (= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).
20. 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 Securities and has directed the Trustee to
use CUSIP numbers in notices of redemption as a convenience to Securityholders.
No representation is made as to the accuracy of such numbers either as printed
on the Securities 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 Securityholder upon written request
and without charge a copy of the Indenture. Request may be made to:
Xxxxx International Networks, Ltd.
0000 Xxxx Xxxxxxx Xxxxxx
P.O. Box 3309
Englewood, Colorado 80155-3309
Attn: Chief Financial Officer
A-3-7
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to:
_______________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint___________________________________________ agent to
transfer this 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 Note)
Signature Guarantee:_______________________________________________________
(Participant in recognized signature guarantee
medallion program)
A-3-8
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to elect to have all or any portion of this Note purchased by the
Company pursuant to Section 4.10 or Section 4.14 of the Indenture, check the
applicable boxes:
[_] Asset Sale Offer: [_] Change of Control Offer:
in whole [_] in whole [_]
in part [_] in part [_]
Amount to be Amount to be
purchased: $_______ purchased: $_______
Dated: __________________ Signature: _______________________________
(Sign exactly as your name
appears on the other side of
this Note)
Signature
Guarantee:_____________________________________________________________________
(Participant in recognized signature guarantee medallion program)
Social Security Number or
Taxpayer Identification Number:________________________________________________
A-3-9
SCHEDULE OF EXCHANGES FOR CERTIFICATED NOTE
OR ANOTHER GLOBAL NOTE/5/
The following exchanges of a part of this Global Note for Certificated
Notes or another Global Note have been made:
Principal Xxxxxx
Xxxxxx of decrease Amount of increase of this Global Signature of
in Principal in Principal Note following authorized officer
Amount of this Amount of this such decrease (or of Trustee or Note
Date of Exchange Global Note Global Note increase) Custodian
------------------ ------------------ ------------------ ----------------- ------------------
_______________________
/5/ This should be included only if the Security is issued in global form.
A-3-10
EXHIBIT B-1
FORM OF CERTIFICATE FOR REGISTRATION OF TRANSFER
FROM RESTRICTED GLOBAL NOTE TO REGULATION S GLOBAL NOTE
(PURSUANT TO SECTION 2.17(A)(I) OF THE INDENTURE)
U.S. TRUST COMPANY OF NEW YORK
c/o Xxxxxxxx X. Xxxxxxx
Assistant Vice President
000 Xxxxx Xxxxxx Xxxxxx
Xxx Xxxxxxx XX 00000-0000
Re: 11 3/4% Senior Secured Notes due 2005, Series A of Xxxxx
International Networks, Ltd.
Reference is hereby made to the Indenture, dated as of July 10, 1998 (the
"Indenture"), among Xxxxx International Networks, Ltd., as issuer (the
"Company"), JPN, Inc., Xxxxx Space Holdings, Inc., Xxxxx Earth Segment, Inc.,
Xxxxx Infomercial Networks, Inc., Xxxxx Radio Holdings, Inc., Great American
Country, Inc., Xxxxx Galactic Radio, Inc., Xxxxx Infomercial Network Ventures,
Inc., Xxxxx Galactic Radio Partners, Inc., Xxxxx Radio Network, Inc., Xxxxx
Audio Services, Inc., Xxxxx Radio Network Ventures, Inc., Xxxxx/Xxxxx Radio
Programming LLC, Xxxxx XXX, Inc. and Xxxxx XXX Radio, Inc., as Guarantors, and
U.S. Trust Company of New York, as trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
This letter relates to $________ principal amount of Notes which are
evidenced by one or more Restricted Global Notes (CUSIP No. ____________) and
held with the Depositary in the name of ________________ (the "Transferor"). The
Transferor has requested a transfer of such beneficial interest in the Notes to
a Person who will take delivery thereof in the form of an equal principal amount
of Notes evidenced by one or more Regulation S Global Notes (CUSIP No.
______________).
In connection with such request and in respect of such Notes, the
Transferor hereby certifies that such transfer has been effected in compliance
with the transfer restrictions applicable to the Global Notes and pursuant to
and in accordance with Rule 903 or Rule 904 under the United States Securities
Act of 1933, as amended (the "Securities Act"), and accordingly the Transferor
hereby further certifies that:
1. The offer of the Notes was not made to a person in the United
States;
2. At the time the buy order was originated, the transferee was
outside the United States or the Transferor and any person acting on its behalf
reasonably believed and believes that the transferee was outside the United
States;
B-1-1
3. No directed selling efforts have been made in contravention of the
requirements of Rule 903(b) or 904(b) of Regulation S, as applicable;
4. The transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
5. If the transaction is completed prior to the expiration of the
Restricted Period, the beneficial interest being transferred as described above
is to be held with the Depositary through Euroclear or Cedel Bank or both
(Common Code _________).
Upon giving effect to this request to exchange a beneficial interest in a
Restricted Global Note for a beneficial interest in a Regulation S Global Note,
the resulting beneficial interest shall be subject to the restrictions on
transfer applicable to Regulation S Global Notes pursuant to the Indenture and
the Securities Act and, if such transfer occurs prior to the end of the
Restricted Period associated with the initial offering of Notes, the additional
restrictions applicable to transfers of interest in the Regulation S Temporary
Global Note.
This certificate and the statements contained herein are made for your benefit
and the benefit of the Company and NatWest Capital Markets Limited, the initial
purchaser of such Notes being transferred. Terms used in this certificate and
not otherwise defined in the Indenture have the meanings set forth in Regulation
S under the Securities Act.
[Insert Name of Transferor]
By: ______________________
Name:
Title:
Dated: __________, _____
cc: Xxxxx International Networks, Ltd.
NatWest Capital Markets Limited.
B-1-2
EXHIBIT B-2
FORM OF CERTIFICATE FOR REGISTRATION OF TRANSFER
FROM REGULATION S GLOBAL NOTE TO RESTRICTED GLOBAL NOTE
(PURSUANT TO SECTION 2.17(A)(II) OF THE INDENTURE)
U.S. TRUST COMPANY OF NEW YORK
c/o Xxxxxxxx X. Xxxxxxx
Assistant Vice President
000 Xxxxx Xxxxxx Xxxxxx
Xxx Xxxxxxx XX 00000-0000
Re: 11 3/4% Senior Secured Notes due 2005, Series A of Xxxxx International
Networks, Ltd.
Reference is hereby made to the Indenture, dated as of July 10, 1998 (the
"Indenture"), among Xxxxx International Networks, Ltd., as issuer (the
"Company"), JPN, Inc., Xxxxx Space Holdings, Inc., Xxxxx Earth Segment, Inc.,
Xxxxx Infomercial Networks, Inc., Xxxxx Radio Holdings, Inc., Great American
Country, Inc., Xxxxx Galactic Radio, Inc., Xxxxx Infomercial Network Ventures,
Inc., Xxxxx Galactic Radio Partners, Inc., Xxxxx Radio Network, Inc., Xxxxx
Audio Services, Inc., Xxxxx Radio Network Ventures, Inc., Xxxxx/Xxxxx Radio
Programming LLC, Xxxxx XXX, Inc. and Xxxxx XXX Radio, Inc., as Guarantors, and
U.S. Trust company of New York, as trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
This letter relates to $________ principal amount of Notes which are evidenced
by one or more Regulation S Global Notes (CUSIP No. ____________) and held with
the Depositary or through [Euroclear] [Cedel Bank] (Common Code _________) in
the name of __________ (the "Transferor"). The Transferor has requested a
transfer of such beneficial interest in the Notes to a Person who will take
delivery thereof in the form of an equal principal amount of Notes evidenced by
one or more Restricted Global Notes (CUSIP No. ______________), to be held with
the Depositary.
In connection with such request and in respect of such Notes, the Transferor
hereby certifies that:
[CHECK ONE]
[ ] such 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 Notes are being transferred to a Person
that the Transferor reasonably believes is purchasing the Notes 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
B-2-1
institutional buyer" within the meaning of Rule 144A in a transaction
meeting the requirements of Rule 144A; or
[ ] such transfer is being effected pursuant to and in accordance with
Rule 144 under the Securities Act; or such transfer is being effected
pursuant to an effective registration statement under the Securities
Act; or
[ ] such transfer is being effected pursuant to an exemption from the
registration requirements of the Securities Act other than Rule 144A
or Rule 144, and the Transferor hereby further certifies that the
Notes are being transferred in compliance with the transfer
restrictions applicable to the Global Notes and in accordance with the
requirements of the exemption claimed, which certification is
supported by an Opinion of Counsel, provided by the Transferor or the
transferee (a copy of which the Transferor has attached to this
certification) in form and substance reasonably acceptable to the
Company, to the effect that such transfer is in compliance with the
Securities Act;
and such Notes are being transferred in compliance with any applicable blue sky
securities laws of any state of the United States.
Upon giving effect to this request to exchange a beneficial interest in
Regulation S Global Notes for a beneficial interest in Restricted Global Notes,
the resulting beneficial interest shall be subject to the restrictions on
transfer applicable to Restricted Global Notes pursuant to 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 NatWest Capital Markets Limited, the
initial purchaser of such Notes being transferred.
[Insert Name of Transferor]
By: ______________________
Name:
Title:
B-2-2
Dated: __________, _____
cc: Xxxxx International Networks, Ltd.
NatWest Capital Markets Limited.
B-2-3
EXHIBIT B-3
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER
OF EXCHANGE NOTES
(PURSUANT TO SECTION 2.17(B) OF THE INDENTURE)
U.S. TRUST COMPANY OF NEW YORK
c/o Xxxxxxxx X. Xxxxxxx
Assistant Vice President
000 Xxxxx Xxxxxx Xxxxxx
Xxx Xxxxxxx XX 00000-0000
Re: 11 3/4% Senior Secured Notes due 2005, Series B of Xxxxx International
Networks, Ltd.
Reference is hereby made to the Indenture, dated as of July 10, 1998 (the
"Indenture"), among Xxxxx International Networks, Ltd., as issuer (the
"Company"), JPN, Inc., Xxxxx Space Holdings, Inc., Xxxxx Earth Segment, Inc.,
Xxxxx Infomercial Networks, Inc., Xxxxx Radio Holdings, Inc., Great American
Country, Inc., Xxxxx Galactic Radio, Inc., Xxxxx Infomercial Network Ventures,
Inc., Xxxxx Galactic Radio Partners, Inc., Xxxxx Radio Network, Inc., Xxxxx
Audio Services, Inc., Xxxxx Radio Network Ventures, Inc., Xxxxx/Xxxxx Radio
Programming LLC, Xxxxx XXX, Inc. and Xxxxx XXX Radio, Inc., as Guarantors, and
U.S. Trust Company of New York, as trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
This letter relates to $________ principal amount of Notes which are
evidenced by one or more Certificated Notes (CUSIP No. ____________) in the name
of ________________ (the "Transferor"). The Transferor has requested an exchange
or transfer of such Certificated Note(s) in the form of an equal principal
amount of Notes evidenced by one or more Certificated Notes (CUSIP No.
______________), to be delivered to the Transferor or, in the case of a transfer
of such Notes, to such Person as the Transferor instructs the Trustee.
In connection with such request and in respect of the Notes surrendered to
the Trustee herewith for exchange (the "Surrendered Notes"), the Holder of such
Surrendered Notes hereby certifies that:
[CHECK ONE]
[ ] the Surrendered Notes are being acquired for the Transferor's own
account, without transfer; or
[ ] the Surrendered Notes are being transferred to the Company; or
B-3-1
[ ] the Surrendered Notes are being transferred 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 Surrendered Notes are
being transferred to a Person that the Transferor reasonably believes
is purchasing the Surrendered Notes 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
each case in a transaction meeting the requirements of Rule 144A; or
[ ] the Surrendered Notes are being transferred in a transaction permitted
by Rule 144 under the Securities Act; or
[ ] the Surrendered Notes are being transferred pursuant to an effective
registration statement under the Securities Act; or
[ ] such transfer is being effected pursuant to an exemption from the
registration requirements of the Securities Act other than Rule 144A
or Rule 144, and the Transferor hereby further certifies that the
Notes are being transferred in compliance with the transfer
restrictions applicable to the Notes and in accordance with the
requirements of the exemption claimed, which certification is
supported by an Opinion of Counsel, provided by the Transferor or the
transferee (a copy of which the Transferor has attached to this
certification) in form and substance reasonably acceptable to the
Company, to the effect that such transfer is in compliance with the
Securities Act;
and the Surrendered Notes are being transferred in compliance with any
applicable blue sky securities laws of any state of the United States.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and NatWest Capital Markets Limited, the
initial purchaser of such Notes being transferred.
B-3-2
[Insert Name of Transferor]
By: ______________________
Name:
Title:
Dated: __________, _____
cc: Xxxxx International Networks, Ltd.
NatWest Capital Markets Limited.
B-3-3
EXHIBIT B-4
FORM OF CERTIFICATE FOR EXCHANGE
OF RESTRICTED GLOBAL NOTE OR REGULATION S
PERMANENT GLOBAL NOTE TO CERTIFICATED NOTE
(PURSUANT TO SECTION 2.17(C) OF THE INDENTURE)
U.S. TRUST COMPANY OF NEW YORK
c/o Xxxxxxxx X. Xxxxxxx
Assistant Vice President
000 Xxxxx Xxxxxx Xxxxxx
Xxx Xxxxxxx XX 00000-0000
Re: 11 3/4% Senior Secured Notes due 2005, Series B of Xxxxx International
Networks, Ltd.
Reference is hereby made to the Indenture, dated as of July 10, 1998 (the
"Indenture"), among Xxxxx International Networks, Ltd., as issuer (the
"Company"), JPN, Inc., Xxxxx Space Holdings, Inc., Xxxxx Earth Segment, Inc.,
Xxxxx Infomercial Networks, Inc., Xxxxx Radio Holdings, Inc., Great American
Country, Inc., Xxxxx Galactic Radio, Inc., Xxxxx Infomercial Network Ventures,
Inc., Xxxxx Galactic Radio Partners, Inc., Xxxxx Radio Network, Inc., Xxxxx
Audio Services, Inc., Xxxxx Radio Network Ventures, Inc., Xxxxx/Xxxxx Radio
Programming LLC, Xxxxx XXX, Inc. and Xxxxx XXX Radio, Inc., as Guarantors, and
U.S. Trust Company of New York, as trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
This letter relates to $________ principal amount of Notes which are
evidenced by a beneficial interest in one or more Restricted Global Notes or
Regulation S Permanent Global Notes (CUSIP Nos. ____________ and ______________)
in the name of ________________ (the "Transferor"). The Transferor has requested
an exchange of such beneficial interest in the form of an equal principal amount
of Notes evidenced by one or more Certificated Notes (CUSIP No. ______________),
to be delivered to the Transferor.
In connection with such request and in respect of the Notes surrendered to
the Trustee herewith for exchange (the "Surrendered Notes"), the Holder of such
Surrendered Notes hereby certifies that the Surrendered Notes are being
transferred to the beneficial owner of such Notes.
B-6-1
SUBSIDIARY GUARANTEE AGREEMENT
For value received, the undersigned hereby unconditionally guarantees
to:
(i) United States Trust Company of New York, as Trustee (the
"Trustee") under that certain Trust Indenture, dated as of July 10, 1998
(the "Indenture"), by and between Xxxxx International Networks Ltd. and the
Trustee; and
(ii) the Holders from time to time of the Securities issued under the
Indenture.
the payment in United States dollars of all amounts due on or in connection with
the Securities, in the amounts and at the times when due, and the payment or
performance of all other obligations of the Company under the Indenture and the
Securities, all in accordance with and subject to the terms and limitations of
Article 10 of the Indenture. This Subsidiary Guarantee Agreement is effective as
a Subsidiary Guarantee in accordance with Article 10 of the Indenture and its
terms are evidenced therein. The validity and enforceability of this Subsidiary
Guarantee Agreement and the Subsidiary Guarantee represented hereby shall not be
affected by the fact that it is not affixed to any particular Security.
Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Indenture.
The obligations of the undersigned to the Trustee and the Holders
pursuant to this Subsidiary Guarantee Agreement and the Indenture are expressly
set forth in Article 10 of the Indenture, and reference is hereby made to the
Indenture for the precise terms of the Subsidiary Guarantee and all of the other
provisions of the Indenture to which this Subsidiary Guarantee Agreement
relates.
THIS SUBSIDIARY GUARANTEE AGREEMENT WILL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, BUT WITHOUT GIVING EFFECT
TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION
OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
This Subsidiary Guarantee Agreement and the Subsidiary Guarantee
represented hereby are subject to release upon the terms set forth in the
Indenture.
The Subsidiary Guarantor acknowledges and agrees that this Subsidiary
Guarantee Agreement and the Subsidiary Guarantee represented hereby are subject
to the provisions of the TIA to the same extent that the Indenture is subject to
the TIA and that
the Subsidiary Guarantor is an "obligor" on the Securities for purposes of the
TIA.
Date: July 10, 1998
By:
Name:
Title:
Accepted:
United States Trust Company
of New York, as Trustee
By:
Name:
Title:
SCHEDULE 1
Secured Party Filing Location Filing Date File Number
------------- --------------- ----------- -----------
AT&T Credit Corporation City Register NY Court 04/13/95 95PN16404
