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EXHIBIT 4.4
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SPLITROCK SERVICES, INC.
11 3/4% Senior Notes due 2008
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INDENTURE
Dated as of July 24, 1998
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BANK OF MONTREAL TRUST COMPANY,
Trustee
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TABLE OF CONTENTS
Page
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ARTICLE 1
Definitions and Incorporation by Reference
SECTION 1.01. Definitions...............................................................................1
SECTION 1.02. Other Definitions........................................................................16
SECTION 1.03. Incorporation by Reference of Trust Indenture Act........................................17
SECTION 1.04. Rules of Construction....................................................................17
ARTICLE 2
The Securities
SECTION 2.01. Amount of Securities; Issuable in Series.................................................18
SECTION 2.02. Form and Dating..........................................................................19
SECTION 2.03. Execution and Authentication.............................................................19
SECTION 2.04. Registrar and Paying Agent...............................................................20
SECTION 2.05. Paying Agent To Hold Money in Trust......................................................20
SECTION 2.06. Securityholder Lists.....................................................................21
SECTION 2.07. Transfer and Exchange....................................................................21
SECTION 2.08. Replacement Securities...................................................................22
SECTION 2.09. Outstanding Securities...................................................................22
SECTION 2.10. Temporary Securities.....................................................................22
SECTION 2.11. Cancelation..............................................................................23
SECTION 2.12. Defaulted Interest.......................................................................23
SECTION 2.13. CUSIP Numbers............................................................................23
ARTICLE 3
Redemption
SECTION 3.01. Notices to Trustee.......................................................................23
SECTION 3.02. Selection of Securities To Be Redeemed...................................................24
SECTION 3.03. Notice of Redemption.....................................................................24
SECTION 3.04. Effect of Notice of Redemption...........................................................25
SECTION 3.05. Deposit of Redemption Price..............................................................25
SECTION 3.06. Securities Redeemed in Part..............................................................25
ARTICLE 4
Covenants
SECTION 4.01. Payment of Securities....................................................................25
SECTION 4.02. SEC Reports..............................................................................25
SECTION 4.03. Limitation on Indebtedness...............................................................26
(i)
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SECTION 4.04. Limitation on Restricted Payments........................................................27
SECTION 4.05. Limitation on Restrictions on Distributions
from Restricted Subsidiaries.................................................29
SECTION 4.06. Limitation on Sales of Assets and Subsidiary Stock.......................................30
SECTION 4.07. Limitation on Transactions with Affiliates...............................................33
SECTION 4.08. Change of Control........................................................................33
SECTION 4.09. Compliance Certificate...................................................................34
SECTION 4.10. Further Instruments and Acts.............................................................34
SECTION 4.11. Future Subsidiary Guarantors.............................................................35
SECTION 4.12. Limitation on Lines of Business..........................................................35
SECTION 4.13. Limitation on the Sale or Issuance of Capital Stock
of Restricted Subsidiaries...................................................35
SECTION 4.14. Limitation on Liens......................................................................35
SECTION 4.15. Limitation on Sale/Leaseback Transactions................................................36
SECTION 4.16. Deposit of Funds with Escrow Agent.......................................................36
ARTICLE 5
Successor Company
SECTION 5.01. When Company May Merge or Transfer Assets................................................36
ARTICLE 6
Defaults and Remedies
SECTION 6.01. Events of Default........................................................................38
SECTION 6.02. Acceleration.............................................................................40
SECTION 6.03. Other Remedies...........................................................................40
SECTION 6.04. Waiver of Past Defaults..................................................................40
SECTION 6.05. Control by Majority......................................................................40
SECTION 6.06. Limitation on Suits......................................................................41
SECTION 6.07. Rights of Holders to Receive Payment.....................................................41
SECTION 6.08. Collection Suit by Trustee...............................................................41
SECTION 6.09. Trustee May File Proofs of Claim.........................................................41
SECTION 6.10. Priorities...............................................................................42
SECTION 6.11. Undertaking for Costs....................................................................42
SECTION 6.12. Waiver of Stay or Extension Laws.........................................................42
ARTICLE 7
Trustee
SECTION 7.01. Duties of Trustee........................................................................43
SECTION 7.02. Rights of Trustee........................................................................44
SECTION 7.03. Individual Rights of Trustee.............................................................44
SECTION 7.04. Trustee's Disclaimer.....................................................................44
SECTION 7.05. Notice of Defaults.......................................................................45
SECTION 7.06. Reports by Trustee to Holders............................................................45
SECTION 7.07. Compensation and Indemnity...............................................................45
SECTION 7.08. Replacement of Trustee...................................................................46
(ii)
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SECTION 7.09. Successor Trustee by Merger..............................................................47
SECTION 7.10. Eligibility; Disqualification............................................................47
SECTION 7.11. Preferential Collection of Claims Against Company........................................47
ARTICLE 8
Discharge of Indenture; Defeasance
SECTION 8.01. Discharge of Liability on Securities; Defeasance.........................................47
SECTION 8.02. Conditions to Defeasance.................................................................48
SECTION 8.03. Application of Trust Money...............................................................49
SECTION 8.04. Repayment to Company.....................................................................49
SECTION 8.05. Indemnity for Government Obligations.....................................................50
SECTION 8.06. Reinstatement............................................................................50
ARTICLE 9
Amendments
SECTION 9.01. Without Consent of Holders...............................................................50
SECTION 9.02. With Consent of Holders..................................................................51
SECTION 9.03. Compliance with Trust Indenture Act......................................................52
SECTION 9.04. Revocation and Effect of Consents and Waivers............................................52
SECTION 9.05. Notation on or Exchange of Securities....................................................52
SECTION 9.06. Trustee to Sign Amendments...............................................................52
SECTION 9.07. Payment for Consent......................................................................53
ARTICLE 10
Escrow Collateral and Security
SECTION 10.01. Escrow and Disbursement Agreement ......................................................53
SECTION 10.02. Recording and Opinions..................................................................54
SECTION 10.03. Release of Escrow Collateral ...........................................................54
SECTION 10.04. Authorization of Actions to Be Taken by the Trustee Under
the Escrow and Disbursement Agreement .......................................54
SECTION 10.05. Authorization of Receipt of Funds by the Trustee Under
the Escrow and Disbursement Agreement........................................55
SECTION 10.06. Termination of Security Interest .......................................................55
ARTICLE 11
Miscellaneous
SECTION 11.01. Trust Indenture Act Controls............................................................55
SECTION 11.02. Notices.................................................................................55
SECTION 11.03. Communication by Holders with Other Holders.............................................56
SECTION 11.04. Certificate and Opinion as to Conditions Precedent......................................56
SECTION 11.05. Statements Required in Certificate or Opinion...........................................56
SECTION 11.06. When Securities Disregarded.............................................................57
SECTION 11.07. Rules by Trustee, Paying Agent and Registrar............................................57
(iii)
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SECTION 11.08. Legal Holidays..........................................................................57
SECTION 11.09. Governing Law...........................................................................57
SECTION 11.10. No Recourse Against Others..............................................................57
SECTION 11.11. Successors..............................................................................57
SECTION 11.12. Multiple Originals......................................................................57
SECTION 11.13. Table of Contents; Headings.............................................................57
Appendix A - Provisions Relating to Original Securities, Additional
Securities, Private Exchange Securities and Exchange
Securities
Exhibit A - Form of Initial Security
Exhibit B - Form of Exchange Security
Exhibit C - Form of Supplemental Indenture
Exhibit D - Form of Transferee Letter of Representation
(iv)
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INDENTURE dated as of July 24, 1998, between
SPLITROCK SERVICES, INC., a Delaware corporation (the
"Company"), and BANK OF MONTREAL TRUST COMPANY, a New
York banking corporation, as trustee (the "Trustee").
Each party agrees as follows for the benefit of the other
party and for the equal and ratable benefit of the Holders of (i) the Company's
11 3/4% Senior Notes due 2008 issued on the date hereof (the "Original
Securities"), (ii) any Additional Securities (as defined herein) that may be
issued on any Issue Date (all such Securities in clauses (i) and (ii) being
referred to collectively as the "Initial Securities"), (iii) if and when issued
as provided in a Registration Agreement (as defined in Appendix A hereto (the
"Appendix")), the Company's 11 3/4% Senior Notes due 2008 issued in a Registered
Exchange Offer (as defined in the Appendix) in exchange for any Initial
Securities (the "Exchange Securities") and (iv) if and when issued as provided
in a Registration Agreement, the Private Exchange Securities (as defined in the
Appendix, and together with the Initial Securities and any Exchange Securities
issued hereunder, the "Securities") issued in a Private Exchange (as defined in
the Appendix). Except as otherwise provided herein, the Securities shall be
limited to $311,000,000 in aggregate principal amount outstanding, of which
$261,000,000 in aggregate principal amount will be initially issued on the date
hereof. Subject to the conditions and in compliance with the covenants set forth
herein, the Company may issue up to $50,000,000 aggregate principal amount of
Additional Securities.
ARTICLE 1
Definitions and Incorporation by Reference
SECTION 1.01. Definitions.
"Additional Securities" means up to $50,000,000 aggregate principal
amount of 11 3/4% Senior Notes due 2008 issued under the terms of this Indenture
subsequent to the Closing Date.
"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. For
purposes of Section 4.07 only, "Affiliate" shall also mean any beneficial owner
of shares representing 5% or more of the total voting power of the Voting Stock
(on a fully diluted basis) of the Company or of rights or warrants to purchase
such Voting Stock (whether or not currently exercisable) and any Person who
would be an Affiliate of any such beneficial owner pursuant to the first
sentence hereof.
"Asset Disposition" means any sale, lease, transfer or other
disposition (or series of related sales, leases, transfers or dispositions) by
the Company or any Restricted
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Subsidiary, including any disposition by means of a merger, consolidation, or
similar transaction (each referred to for the purposes of this definition as a
"disposition"), of (i) any shares of Capital Stock of a Restricted Subsidiary
(other than directors' qualifying shares or shares required by applicable law to
be held by a Person other than the Company or a Restricted Subsidiary), (ii) all
or substantially all the assets of any division or line of business of the
Company or any Restricted Subsidiary or (iii) any other assets of the Company or
any Restricted Subsidiary other than inventory or obsolete assets sold in the
ordinary course of business of the Company or such Restricted Subsidiary (other
than, in the case of (i), (ii) and (iii) above, (x) a disposition by a
Restricted Subsidiary to the Company or by the Company or a Restricted
Subsidiary to a Wholly Owned Subsidiary, (y) for purposes of the provisions
described under Section 4.06 only, a disposition subject to Section 4.04 and (z)
a disposition of assets with a fair market value of less than $250,000).
"Attributable Debt" 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 a 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 products of the numbers of years 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 any Indebtedness outstanding under any credit
or similar agreement with a financial institution which provides for revolving
credit loans, term loans or letters of credit or other credit facilities, as
amended, waived, restated, supplemented, extended, replaced, refinanced or
otherwise modified from time to time.
"Board of Directors" means the Board of Directors of the Company or any
committee thereof duly authorized to act on behalf of such Board.
"Business Day" means each day which is not a Legal Holiday.
"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.
"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 upon which such lease may be prepaid by the lessee without payment of a
penalty.
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"Cash Contribution Amount" means the aggregate amount of cash
contributions made to the capital of the Company described in the definition of
"Contribution Indebtedness".
"Change of Control" means the occurrence of any of the following
events:
(i) prior to the first public offering of common stock of the
Company, the Permitted Holders cease to be the "beneficial owner" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, of a majority in the aggregate of the total voting power of
the Voting Stock of the Company, whether as a result of issuance of
securities of the Company, any merger, consolidation, liquidation or
dissolution of the Company, any direct or indirect transfer of
securities by any Permitted Holder or otherwise (for purposes of this
clause (i) and clause (ii) below, the Permitted Holders shall be deemed
to beneficially own any Voting Stock of an entity (the "specified
entity") held by any other entity (the "parent entity") so long as the
Permitted Holders beneficially own (as so defined), directly or
indirectly, in the aggregate a majority of the voting power of the
Voting Stock of the parent entity);
(ii) on the date of or after the first public offering of
common stock of the Company referred in clause (i), (A) any "person"
(as such term is used in Sections 13(d) and 14(d) of the Exchange Act),
other than one or more Permitted Holders, is or becomes the beneficial
owner (as defined in clause (i) above, except that for purposes of this
clause (ii) such person shall be deemed to have "beneficial ownership"
of all shares that any such person has the right to acquire, whether
such right is exercisable immediately or only after the passage of
time), directly or indirectly, of more than 35% of the total voting
power of the Voting Stock of the Company and (B) the Permitted Holders
"beneficially own" (as defined in clause (i) above), directly or
indirectly, in the aggregate a lesser percentage of the total voting
power of the Voting Stock of the Company than such other person and do
not have the right or ability by voting power, contract or otherwise to
elect or designate for election a majority of the Board of Directors
(for the purposes of this clause (ii), such other person shall be
deemed to beneficially own any Voting Stock of a specified entity held
by a parent entity, if such other person is the beneficial owner (as
defined in this clause (ii)), directly or indirectly, of more than 35%
of the voting power of the Voting Stock of such parent entity and the
Permitted Holders "beneficially own" (as defined in clause (i) above),
directly or indirectly, in the aggregate a lesser percentage of the
voting power of the Voting Stock of such parent entity and do not have
the right or ability by voting power, contract or otherwise to elect or
designate for election a majority of the board of directors of such
parent entity);
(iii) during any period of two consecutive years, individuals
who at the beginning of such period constituted the Board of Directors
(together with any new directors whose election by such Board of
Directors or whose nomination for election by the stockholders of the
Company was approved by a vote of 66 2/3% of the directors of the
Company then still in office who were either directors at the beginning
of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority
of the Board of Directors of the Company then in office;
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(iv) the adoption of a plan relating to the liquidation or
dissolution of the Company; or
(v) the merger or consolidation of the Company with or into
another Person or the merger of another Person with or into the
Company, or the sale of all or substantially all the assets of the
Company to another Person (other than a Person that is controlled by
the Permitted Holders), and, in the case of any such merger or
consolidation, the securities of the Company that are outstanding
immediately prior to such transaction and which represent 100% of the
aggregate voting power of the Voting Stock of the Company are changed
into or exchanged for cash, securities or property, unless pursuant to
such transaction such securities are changed into or exchanged for, in
addition to any other consideration, securities of the surviving Person
or transferee that represent immediately after such transaction, at
least a majority of the aggregate voting power of the Voting Stock of
the surviving Person or transferee.
"Closing Date" means the date of this Indenture.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor and, for purposes of
any provision contained herein and required by the TIA, each other obligor on
the indenture securities.
"Consolidated Interest Expense" means, for any period, the total
interest expense of the Company and its Consolidated Restricted Subsidiaries,
plus, to the extent Incurred by the Company and its Subsidiaries in such period
but not included in such interest expense, (i) interest expense attributable to
Capitalized Lease Obligations and the interest expense relating to Attributable
Debt, (ii) amortization of debt discount and debt issuance costs, (iii)
capitalized interest, (iv) non-cash interest expense, (v) commissions, discounts
and other fees and charges attributable to letters of credit and bankers'
acceptance financing, (vi) interest accruing on any Indebtedness of any other
Person to the extent such Indebtedness is Guaranteed by the Company or any
Restricted Subsidiary, (vii) net costs associated with Hedging Obligations
(including amortization of fees), (viii) dividends in respect of all
Disqualified Stock of the Company and all Preferred Stock of the Subsidiaries of
the Company to the extent held by Persons other than the Company or a Wholly
Owned Subsidiary, (ix) interest Incurred in connection with investments in
discontinued operations and (x) the cash contributions to any employee stock
ownership plan or similar trust to the extent such contributions 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.
"Consolidated Net Income" means, for any period, the net income of the
Company and its Consolidated Subsidiaries for such period; provided, however,
that there shall not be included in such Consolidated Net Income: (i) any net
income or loss of any Person (other than the Company) if such Person is not a
Restricted Subsidiary, except that (A) subject to the limitations contained in
clause (iv) below, the Company's equity in the net income of any such Person for
such period shall be included in such Consolidated Net Income up to the
aggregate amount of cash actually distributed by such Person during such period
to the Company or a Restricted Subsidiary as a dividend or other distribution
(subject, in the case of a dividend or other distribution made to a Restricted
Subsidiary, to
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the limitations contained in clause (iii) below) and (B) the Company's equity in
a net loss of any such Person (including any Unrestricted Subsidiary) for such
period shall be included in determining such Consolidated Net Income; (ii) any
net income (or loss) of any Person acquired by the Company or a Subsidiary in a
pooling of interests transaction for any period prior to the date of such
acquisition; (iii) any net income (or loss) of any Restricted Subsidiary 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, except that (A) subject to
the limitations contained in clause (iv) below, the Company's equity in the net
income of any such Restricted Subsidiary for such period shall be included in
such Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Restricted Subsidiary during such period to the Company or
another Restricted Subsidiary as a dividend or other distribution (subject, in
the case of a dividend or other distribution made to another Restricted
Subsidiary, to the limitation contained in this clause) and (B) the Company's
equity in a net loss of any such Restricted Subsidiary for such period shall be
included in determining such Consolidated Net Income; (iv) any gain (but not
loss) realized upon the sale or other disposition of any asset of the Company or
its Consolidated Subsidiaries (including pursuant to any Sale/Leaseback
Transaction) that is not sold or otherwise disposed of in the ordinary course of
business and any gain (but not loss) realized upon the sale or other disposition
of any Capital Stock of any Person; (v) any extraordinary gain or loss; and (vi)
the cumulative effect of a change in accounting principles. Notwithstanding the
foregoing, for the purpose of Section 4.04 only, there shall be excluded from
Consolidated Net Income any dividends, 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
4.04(a)(3)(D).
"Consolidated Operating 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 of
the Company and its Consolidated Restricted Subsidiaries, (ii) Consolidated
Interest Expense, (iii) depreciation expense of the Company and its Consolidated
Restricted Subsidiaries, (iv) amortization expense of the Company and its
Consolidated Restricted Subsidiaries (excluding amortization expense
attributable to a prepaid cash item that was paid in a prior period) and (v) all
other non-cash charges of the Company and its Consolidated Restricted
Subsidiaries (excluding any such non-cash charge to the extent it represents an
accrual of or reserve for cash expenditures in any future period) in each case
for such period. Notwithstanding the foregoing, the provision for taxes based on
the income or profits of, and the depreciation and amortization and non-cash
charges of, a Restricted Subsidiary of the Company shall be added to
Consolidated Net Income to compute Consolidated Operating Cash Flow only to the
extent (and in the same proportion) that the net income of such Restricted
Subsidiary was included in calculating Consolidated Net Income and only if a
corresponding amount would be permitted at the date of determination to be
dividended to the Company by such Restricted Subsidiary without prior approval
(that has not been obtained), pursuant to the terms of its charter and all
agreements, instruments, judgments, decrees, orders, statutes, rules and
governmental regulations applicable to such Restricted Subsidiary or its
stockholders.
"Consolidation" means the consolidation of the amounts of each
Restricted Subsidiary with those of the Company in accordance with GAAP
consistently applied; provided, however, that "Consolidation" shall not include
consolidation of the accounts
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of any Unrestricted Subsidiary, but the interest of the Company or any
Restricted Subsidiary in an Unrestricted Subsidiary shall be accounted for as an
investment. The term "Consolidated" has a correlative meaning.
"Contribution Indebtedness" means Indebtedness of the Company in an
aggregate principal amount not greater than twice the aggregate amount of the
Net Cash Proceeds received by the Company from contributions made to the capital
of the Company after the date hereof, provided, however, that such Contribution
Indebtedness (i) has a Stated Maturity later than the Stated Maturity of the
Securities, (ii) is Incurred substantially concurrently with such cash
contribution, and (iii) is so designated as Contribution Indebtedness, pursuant
to an Officers' Certificate, on the Incurrence date thereof.
"Currency Agreement" means with respect to any Person, any foreign
exchange contract, currency swap agreement or any similar agreement or
arrangement to which such Person is a party or of which it is a beneficiary.
"Debt to Annualized Operating Cash Flow Ratio" means the ratio of (a)
the Total Consolidated Indebtedness as of the date of calculation (the
"Determination Date") to (b) four times the Consolidated Operating Cash Flow for
the latest fiscal quarter for which financial information is available
immediately preceding such Determination Date (the "Measurement Period"). For
purposes of calculating Consolidated Operating Cash Flow for the Measurement
Period immediately prior to the relevant Determination Date, (i) any Person that
is a Restricted Subsidiary on the Determination Date (or would become a
Restricted Subsidiary on such Determination Date in connection with the
transaction that requires the determination of such Consolidated Operating Cash
Flow) shall be deemed to have been a Restricted Subsidiary at all times during
such Measurement Period, (ii) any Person that is not a Restricted Subsidiary on
such Determination Date (or would cease to be a Restricted Subsidiary on such
Determination Date in connection with the transaction that requires the
determination of such Consolidated Operating Cash Flow) shall be deemed not to
have been a Restricted Subsidiary at any time during such Measurement Period,
and (iii) if the Company or any Restricted Subsidiary shall have in any manner
(x) acquired (through an acquisition or the commencement of activities
constituting such operating business) or (y) disposed of (by an Asset
Disposition or the termination or discontinuance of activities constituting such
operating business) any operating business during such Measurement Period or
after the end of such period and on or prior to such Determination Date, such
calculation shall be made on a pro forma basis in accordance with GAAP as if all
such transactions had been consummated prior to the first day of such
Measurement Period (it being understood that in calculating Consolidated
Operating Cash Flow, the exclusions set forth in clauses (i) through (vi) of the
definition of Consolidated Net Income shall apply to a Person which has been
acquired as if it were a Restricted Subsidiary).
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Disqualified Stock" means, with respect to any Person, 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 exercisable) or upon the
happening of any event (i) matures or is mandatorily redeemable pursuant to a
sinking fund obligation or otherwise, (ii) is convertible or exchangeable for
Indebtedness or Disqualified Stock or (iii) is redeemable at the option of the
holder thereof, in whole or in part, in each case on or prior to the first
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anniversary of the Stated Maturity of the Securities; provided, however, that
any Capital Stock that would not constitute Disqualified Stock but for
provisions thereof giving holders thereof the right to require such Person to
repurchase or redeem such Capital Stock upon the occurrence of an "asset sale"
or "change of control" occurring prior to the first anniversary of the Stated
Maturity of the Securities shall not constitute Disqualified Stock if the "asset
sale" or "change of control" provisions applicable to such Capital Stock are not
more favorable to the holders of such Capital Stock than the provisions of
Section 4.06 and Section 4.08.
"Equity Offering" means any public or private sale of common stock or
Preferred Stock of the Company (other than Disqualified Stock) other than any
sale to a Permitted Holder.
"Escrow Account" means an escrow account for the deposit of
approximately $54.9 million of the net proceeds from the sale of the Securities
under the Escrow and Disbursement Agreement.
"Escrow Agent" means The Chase Manhattan Bank as the Escrow Agent under
the Escrow and Disbursement Agreement, or any successor thereto appointed
pursuant to such agreement.
"Escrow Collateral" has the meaning provided in the Escrow and
Disbursement Agreement.
"Escrow and Disbursement Agreement" means the Escrow and Disbursement
Agreement, dated as of the Closing Date, by and among the Escrow Agent, the
Trustee and the Company, governing the disbursement of funds from the Escrow
Account.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Fair Market Value" means, with respect to any asset or property, the
price that could be negotiated in an arm's-length free market transaction, for
cash, between a willing seller and a willing buyer, neither of whom is under
pressure or compulsion to complete the transaction. Unless otherwise specified
in this Indenture, Fair Market Value shall be determined by the Board of
Directors of the Company acting in good faith and shall be evidenced by a
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 Closing Date, including those set forth
in (i) the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants, (ii) statements and
pronouncements of the Financial Accounting Standards Board, (iii) such other
statements by such other entities as approved by a significant segment of the
accounting profession and (iv) the rules and regulations of the SEC governing
the inclusion of financial statements (including pro forma financial statements)
in periodic reports required to be filed pursuant to Section 13 of the Exchange
Act, including opinions and pronouncements in staff accounting bulletins and
similar written statements from the accounting staff of the SEC. All ratios and
computations based on GAAP contained in this Indenture shall be computed in
conformity with GAAP.
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"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness or other obligation
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 or other obligation of such other
Person (whether arising by virtue of partnership arrangements, or by agreement
to keep-well, to purchase assets, goods, securities or services, to take-or-pay,
or to maintain financial statement conditions or otherwise) or (ii) entered into
for purposes of assuring in any other manner the obligee of such Indebtedness or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part); provided, 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. The term "Guarantor" shall mean any Person Guaranteeing
any obligation.
"Hedging Obligations" of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement or any Currency Agreement.
"Holder" or "Securityholder" means the Person in whose name a Security
is registered on the registrar's books.
"Incur" means issue, assume, Guarantee, incur or otherwise become
liable for; provided, however, that any Indebtedness or Capital Stock of a
Person existing at the time such Person becomes a Subsidiary (whether by merger,
consolidation, acquisition or otherwise) shall be deemed to be Incurred by such
Person at the time it becomes a Subsidiary. The term "Incurrence" when used as a
noun shall have a correlative meaning. The accretion of principal of a
non-interest bearing or other discount security shall be deemed the Incurrence
of 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); (iv) all obligations
of such Person to pay the deferred and unpaid purchase price of property or
services (except Trade Payables), 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) Capitalized Lease
Obligations and all Attributable Debt of such Person; (vi) 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 Subsidiary of such
Person, any Preferred Stock (but excluding, in each case, any accrued
dividends); (vii) all Indebtedness of other Persons secured by a Lien on any
asset of such Person, whether or not such Indebtedness is assumed by such
Person; provided, however, that the amount of Indebtedness of such Person shall
be the lesser of (A) the fair market value of such asset at such date of
determination and (B) the amount of such Indebtedness of such other Persons;
(viii) to the extent not otherwise included in this definition, Hedging
Obligations of such Person; and (ix) all obligations of the type referred to in
clauses (i) through (viii) of other Persons and all dividends of other Persons
for the payment of which, in either case, such Person is responsible or liable,
directly or indirectly, as obligor, guarantor or otherwise, including by means
of any Guarantee. The amount of Indebtedness of any Person at any date shall be
the outstanding balance at such
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date of all unconditional obligations as described above and the maximum
liability, upon the occurrence of the contingency giving rise to the obligation,
of any contingent obligations at such date.
"Indenture" means this Indenture as amended or supplemented from time
to time.
"Interest Payment Date" means January 15 and July 15 of each year
commencing on January 15, 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.
"Issue Date", with respect to any Initial Securities, means the date on
which such Initial Securities are originally issued.
"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 receivable on the balance sheet of the lender) or other
extension of credit (including by way of Guarantee or similar arrangement) or
capital contribution to (by means of any transfer of cash or other property to
others or any payment for property or services for the account or use of
others), or any purchase or acquisition of Capital Stock, Indebtedness or other
similar instruments issued by such Person. For purposes of the definition of
"Unrestricted Subsidiary" and Section 4.04, (i) "Investment" shall include the
portion (proportionate to the Company's equity interest in such Subsidiary) of
the fair market value of the net assets of any Subsidiary of the Company at the
time that such Subsidiary is designated an Unrestricted Subsidiary; provided,
however, that upon a redesignation of such Subsidiary as a Restricted
Subsidiary, the Company shall be deemed to continue to have a permanent
"Investment" in an Unrestricted Subsidiary in an amount (if positive) equal to
(x) the Company's "Investment" in such Subsidiary at the time of such
redesignation 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 of such redesignation; and (ii) any property transferred
to or from an Unrestricted 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.
"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).
"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 and proceeds
from the sale or other disposition of any securities received as consideration,
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 that are the subject of such
Asset Disposition or received in any other non-cash form) 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, provincial, foreign
and local taxes required
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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 or other security agreement of any kind with respect to 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 required to be
made to minority interest holders in Subsidiaries or joint ventures as a result
of such Asset Disposition and (iv) appropriate amounts to be provided by the
seller as a reserve, in accordance with GAAP, against any liabilities associated
with the property or other assets disposed of in such Asset Disposition and
retained by the Company or any Restricted Subsidiary after such Asset
Disposition.
"Net Cash Proceeds", with respect to any issuance or sale of Capital
Stock or any equity contribution, means the cash proceeds of such issuance, sale
or contribution net of attorneys' fees, accountants' fees, underwriters' or
placement agents' fees, discounts or commissions and brokerage, consultant and
other fees actually incurred in connection with such issuance, sale or
contribution and net of taxes paid or payable as a result thereof.
"Officer" means the Chairman of the Board, the Chief Executive Officer,
the Chief Financial Officer, the President, any Vice President, the Treasurer or
the Secretary of the Company.
"Officers' Certificate" means a certificate signed by two Officers.
"Opinion of Counsel" means a written opinion from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company or the Trustee.
"Permitted Holders" means Xxxx X. Xx, Xxxxxxx X. Xxxxxx and Linsang
Partners, LLC and any Person acting in the capacity of an underwriter in
connection with a public or private offering of the Company's Capital Stock.
"Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary in (i) the Company, a Restricted Subsidiary or a Person
that will, upon the making of such Investment, become a Restricted Subsidiary;
provided, however, that the primary business of such Restricted Subsidiary is a
Telecommunications Business; (ii) another Person if as a result of such
Investment such other Person is merged or consolidated with or into, or
transfers or conveys all or substantially all its assets to, the Company or a
Restricted Subsidiary; provided, however, that such Person's primary business is
a Telecommunications Business; (iii) Temporary Cash Investments; (iv)
receivables owing to the Company or any Restricted Subsidiary if created or
acquired in the ordinary course of business and payable or dischargeable in
accordance with customary trade terms; provided, however, that such trade terms
may include such concessionary trade terms as the Company or any such Restricted
Subsidiary deems reasonable under the circumstances; (v) Investments in prepaid
expenses; (vi) loans or advances to employees made in the ordinary course of
business of the Company or such Restricted Subsidiary and not exceeding $2.0
million in the aggregate outstanding at any one time; (vii) stock, obligations
or securities received in settlement of debts created in the ordinary course of
business and owing to the Company or any Restricted Subsidiary or in
satisfaction of judgments; (viii) any Person to the extent such Investment
represents
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the non-cash portion of the consideration received for an Asset Disposition that
was made pursuant to and in compliance with Section 4.06; (ix) Investments made
prior to the Closing Date; (x) Investments in Telecommunications Assets not to
exceed $30.0 million at any one time outstanding; and (xi) other Investments,
not to exceed the greater of (a) 10% of Total Assets of the Company at the time
of such Investment (with the fair market value of each Investment being measured
at the time made and without giving effect to subsequent changes in value) and
(b) $30.0 million.
"Permitted Liens" means, with respect to any Person, (a) pledges or
deposits by such Person under worker's compensation laws, unemployment insurance
laws or similar legislation, or good faith deposits in connection with bids,
tenders, contracts (other than for the payment of Indebtedness) or leases to
which such Person is a party, or deposits to secure public or statutory
obligations of such Person or deposits of cash or United States government bonds
to secure surety or appeal bonds to which such Person is a party, or deposits as
security for contested taxes or import duties or for the payment of rent, in
each case Incurred in the ordinary course of business; (b) Liens imposed by law,
such as carriers', warehousemen's and mechanics' Liens, in each case for sums
not yet due or being contested in good faith by appropriate proceedings or other
Liens arising out of judgments or awards against such Person with respect to
which such Person shall then be proceeding with an appeal or other proceedings
for review; (c) Liens for property taxes not yet due or payable or subject to
penalties for non-payment or which are being contested in good faith by
appropriate proceedings; (d) Liens in favor of issuers of surety bonds issued
pursuant to the request of and for the account of such Person in the ordinary
course of its business; (e) minor survey exceptions, minor 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 or
Liens incidental to the conduct of the business of such Person or to the
ownership of its properties which 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 such Person; (f) Liens to secure Indebtedness permitted pursuant to
clauses (b)(i) and (b)(vi) of Section 4.03; (g) Liens existing on the Closing
Date; (h) Liens on property or shares of stock of another Person at the time
such other Person becomes a Subsidiary of such Person; provided, however, that
such Liens are not created, Incurred or assumed in connection with, or in
contemplation of, such other Person becoming such a Subsidiary; provided
further, however, that such Liens do not extend to any other property owned by
such Person or any of its Subsidiaries; (i) Liens on property at the time such
Person or any of its Subsidiaries acquires the property, including any
acquisition by means of a merger or consolidation with or into such Person or
any Subsidiary of such Person; provided, however, that such Liens are not
created, Incurred or assumed in connection with, or in contemplation of, such
acquisition; provided further, however, that the Liens do not extend to any
other property owned by such Person or any of its Subsidiaries; (j) Liens
securing Indebtedness or other obligations of a Subsidiary of such Person owing
to such Person or a wholly owned Subsidiary of such Person; (k) Liens securing
obligations under Interest Rate Agreements so long as such obligations under
Interest Rate Agreements relate to Indebtedness that is, and is permitted under
this Indenture to be, secured by a Lien on the same property securing such
obligations under Interest Rate Agreements; (l) Liens to secure any Refinancing
(or successive Refinancings) as a whole, or in part, of any Indebtedness secured
by any Lien referred to in the foregoing clauses (f), (g), (h) and (i);
provided, however, that (x) such new Lien shall be limited to all or part of the
same property that secured the original Lien (plus improvements to or on
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such property) and (y) the Indebtedness secured by such Lien at such time is not
increased to any amount greater than the sum of (A) the outstanding principal
amount or, if greater, committed amount of the Indebtedness secured by Liens
described under clauses (f), (g), (h) or (i) at the time the original Lien
became a Permitted Lien under this Indenture and (B) an amount necessary to pay
any fees and expenses, including premiums, related to such Refinancings; and (m)
Liens in favor of the Trustee arising under the provisions of the Escrow and
Disbursement Agreement and the provisions of this Indenture relating thereto.
Notwithstanding the foregoing, "Permitted Liens" shall not include any Lien
described in clauses (f), (h) or (i) above to the extent such Lien applies to
any Telecommunications Assets acquired directly or indirectly from Net Available
Cash pursuant to Section 4.06.
"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
thereof or any other entity.
"Preferred Stock", as applied to the Capital Stock of any Person, means
Capital Stock of any class or classes (however designated) that 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 Person, over shares
of Capital Stock of any other class of such Person.
"principal" of a Security means the principal of the Security plus the
premium, if any, payable on the Security which is due or overdue or is to become
due at the relevant time.
"Prodigy Agreement" means the Splitrock Full Service Agreement dated as
of June 24, 1997 between the Company and Prodigy, Inc. as in effect on the date
hereof.
"Purchase Money Indebtedness" means Secured Indebtedness (including
Capitalized Lease Obligations, mortgage financings and purchase money
obligations) incurred for the purpose of financing all or any part of the cost
of construction, installation, acquisition, lease, development or improvement by
the Company or any Restricted Subsidiary of any Telecommunications Assets of the
Company or any Restricted Subsidiary and including any related notes,
Guarantees, collateral documents, instruments and agreements executed in
connection therewith, as the same may be amended, supplemented, modified or
restated from time to time provided, however, that (i) the security agreement or
conditional sales or other title retention contract pursuant to which a Lien on
such assets is created shall be entered into within 180 days after the purchase
or acquisition of such assets and shall at all times be confined solely to the
assets so purchased or acquired, any additions, replacements, modifications and
accessions thereto and any proceeds and products therefrom, (ii) at no time
shall the aggregate principal amount of the outstanding Indebtedness secured
thereby be increased, except in connection with the purchase of additions and
accessions thereto and except in respect of fees and other obligations in
respect of such Indebtedness and (iii) the Indebtedness secured thereby shall be
with recourse solely to the assets so purchased or acquired, any additions,
replacements, modifications and accessions thereto and any proceeds and products
therefrom.
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"Refinance" means, in respect of any Indebtedness, to refinance,
extend, renew, refund, repay, prepay, redeem, defease or retire, or to issue
other Indebtedness exchange or replacement for, such Indebtedness. "Refinanced"
and "Refinancing" shall have correlative meanings.
"Refinancing Indebtedness" means Indebtedness that is Incurred to
refund, refinance, replace, renew, repay or extend (including pursuant to any
defeasance or discharge mechanism) any Indebtedness of the Company or any
Restricted Subsidiary existing on the date of this Indenture or Incurred in
compliance with this Indenture (including Indebtedness of the Company that
Refinances Refinancing Indebtedness); provided, however, that (i) the
Refinancing Indebtedness has a Stated Maturity no earlier than the 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 Average Life of the Indebtedness being
refinanced, (iii) such Refinancing Indebtedness is Incurred in an aggregate
principal amount (or if issued with original issue discount, an aggregate issue
price) that is equal to or less than the aggregate principal amount (or if
issued with original issue discount, the aggregate accreted value) then
outstanding of the Indebtedness being Refinanced and (iv) if the Indebtedness
being Refinanced is subordinated in right of payment to the Securities, such
Refinancing Indebtedness is subordinated in right of payment to the Securities
at least to the same extent as the Indebtedness being Refinanced; provided
further, however, that Refinancing Indebtedness shall not include (x)
Indebtedness of a Restricted Subsidiary that Refinances Indebtedness of the
Company or (y) Indebtedness of the Company or a Restricted Subsidiary that
Refinances Indebtedness of an Unrestricted Subsidiary.
"Restricted Subsidiary" means any Subsidiary of the Company other than
an Unrestricted Subsidiary.
"Sale/Leaseback Transaction" means an arrangement relating to property
now owned or hereafter acquired by the Company or a Restricted Subsidiary
whereby the Company or a Restricted Subsidiary transfers such property to a
Person and the Company or such Restricted Subsidiary leases it from such Person,
other than leases between the Company and a Wholly Owned Subsidiary or between
Wholly Owned Subsidiaries.
"SEC" means the Securities and Exchange Commission.
"Secured Indebtedness" means any Indebtedness of the Company secured by
a Lien.
"Securities" means the Securities issued under this Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Indebtedness" of the Company means the principal of, premium
(if any) and accrued and unpaid interest on (including interest accruing on or
after the filing of any petition in bankruptcy or for reorganization of the
Company, regardless of whether or not a claim for post-filing interest is
allowed in such proceedings), and fees and other amounts owing in respect of,
Bank Indebtedness and all other Indebtedness of the Company, whether outstanding
on the Closing Date or thereafter Incurred, unless in the instrument creating or
evidencing the same or pursuant to which the same is outstanding it is provided
that such obligations are subordinated in right of payment to the Securities;
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provided, however, that Senior Indebtedness shall not include (i) any obligation
of the Company to any Subsidiary, (ii) any liability for Federal, state, local
or other taxes owed or owing by the Company, (iii) any accounts payable or other
liability to trade creditors arising in the ordinary course of business
(including Guarantees thereof or instruments evidencing such liabilities), (iv)
any Indebtedness or obligation of the Company (and any accrued and unpaid
interest in respect thereof) that by its terms is subordinate or junior in any
respect to any other Indebtedness or obligation of the Company, including any
Subordinated Obligations, (v) any obligations with respect to any Capital Stock,
or (vi) any Indebtedness Incurred in violation of this Indenture.
"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 SEC.
"Stated Maturity" means, with respect to any security, the date
specified in such security as the fixed date on which the final payment of
principal of such security is due and payable, including pursuant to any
mandatory redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the
happening of any contingency beyond the control of the issuer unless such
contingency has occurred).
"Subordinated Obligation" means, with respect to any Person, any
Indebtedness of such Person (whether outstanding on the Closing Date or
thereafter Incurred) that is subordinate or junior in right of payment to the
Securities or any other indebtedness of such Person pursuant to a written
agreement.
"Subsidiary" of any Person means any corporation, association,
partnership or other business entity of which more than 50% of the total voting
power of shares of Capital Stock or other interests (including partnership
interests) entitled (without regard to the occurrence of any contingency) to
vote in the election of directors, managers or trustees thereof is at the time
owned or controlled, directly or indirectly, by (i) such Person, (ii) such
Person and one or more Subsidiaries of such Person or (iii) one or more
Subsidiaries of such Person.
"Subsidiary Guarantee" means each Guarantee of the obligations with
respect to the Securities issued by a Person pursuant to the terms of this
Indenture.
"Subsidiary Guarantor" means any Person that has issued a Subsidiary
Guarantee.
"Telecommunications Assets" means all assets (including Capital Stock),
rights (contractual or otherwise) and properties, real or personal, whether
tangible or intangible, used or intended for use in connection with a
Telecommunications Business.
"Telecommunications Business" means the business of (i) transmitting,
or providing services relating to the transmission of, data, video or voice
through owned or leased transmission facilities, (ii) constructing, creating,
developing or marketing networks, related network transmission equipment,
software and other devices for use in a communication business or (iii)
evaluating, participating or pursuing any other activity or opportunity that is
primarily related to those identified in (i) or (ii) above; provided that the
determination of what constitutes a Telecommunications Business shall be made in
good faith by the Board of Directors of the Company.
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"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 that 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 $500.0 million (or the foreign currency
equivalent thereof) and whose 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 90 days after the date of acquisition,
issued by a corporation (other than an Affiliate of the Company) organized and
in existence under the laws of the United States of America 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 Investors Service, Inc. or "A-1" (or higher) according to Standard and
Poor's Ratings Service, a division of The XxXxxx-Xxxx Companies, Inc. ("S&P"),
and (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
Investors Service, Inc.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date of this Indenture.
"Total Assets" means, with respect to any Person, the total
Consolidated assets of such Person and its Restricted Subsidiaries, as shown on
the most recent balance sheet of such Person.
"Total Consolidated Indebtedness" means, as of any date of
determination, an amount equal to the aggregate amount of all Indebtedness of
the Company and its Restricted Subsidiaries, determined on a Consolidated basis
in accordance with GAAP, outstanding as of such date of determination, after
giving effect to any Incurrence of Indebtedness and the application of the
proceeds therefrom giving rise to such determination.
"Trade Payables" means, with respect to any Person, any accounts
payable or any indebtedness or monetary obligation to trade creditors created,
assumed or Guaranteed by such Person arising in the ordinary course of business
in connection with the acquisition of goods or services.
"Trustee" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor.
"Trust Officer" means the Chairman of the Board, the President or any
other officer or assistant officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
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"Uniform Commercial Code" means the New York Uniform Commercial Code as
in effect from time to time.
"Unrestricted Subsidiary" means (i) any 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 and (ii) any Subsidiary of
an Unrestricted Subsidiary. 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 (a) such Subsidiary or any of
its Subsidiaries owns any Capital Stock or Indebtedness of, or owns or holds any
Lien on any property of, the Company or any other Subsidiary of the Company that
is not a Subsidiary of the Subsidiary to be so designated; (b) a Default or
Event of Default shall have occurred and be continuing; or (c) immediately after
giving effect to such designation, the Company would not be able to Incur $1.00
of Indebtedness pursuant to Section 4.03(a); provided, however, that either (A)
the Subsidiary to be so designated has total Consolidated assets of $1,000 or
less or (B) if such Subsidiary has Consolidated assets greater than $1,000, then
such designation would be permitted pursuant to Section 4.04. The Board of
Directors may designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided, however, that immediately after giving effect to such
designation (x) the Company could Incur $1.00 of additional Indebtedness
pursuant to Section 4.03(a) and (y) no Default shall have occurred and be
continuing. Any such designation of a Subsidiary as a Restricted Subsidiary or
Unrestricted Subsidiary by the Board of Directors shall be evidenced to the
Trustee by promptly filing with the Trustee a copy of the resolution of the
Board of Directors giving effect to such designation and an Officers'
Certificate certifying that such designation complied with the foregoing
provisions.
"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.
"Voting Stock" of a Person means all classes of Capital Stock or other
interests (including partnership interests) of such Person then outstanding and
normally entitled (without regard to the occurrence of any contingency) to vote
in the election of directors, managers or trustees thereof.
"Wholly Owned Subsidiary" means a Restricted Subsidiary of the Company
all 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
---- -------------
"Affiliate Transaction".......................................................... 4.07
"Bankruptcy Law"................................................................. 6.01
"Change of Control Offer......................................................... 4.08(b)
"covenant defeasance option"..................................................... 8.01(b)
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Defined in
Term Section
---- -------------
"Custodian"...................................................................... 6.01
"Event of Default"............................................................... 6.01
"legal defeasance option"........................................................ 8.01(b)
"Legal Holiday".................................................................. 11.08
"Offer".......................................................................... 4.06(c)
"Offer Amount"................................................................... 4.06(d)(2)
"Offer Period"................................................................... 4.06(d)(2)
"Paying Agent"................................................................... 2.04
"protected purchaser"............................................................ 2.08
"Purchase Date".................................................................. 4.06(d)
"Registrar"...................................................................... 2.04
"Restricted Payment.............................................................. 4.04
"Successor Company".............................................................. 5.01
SECTION 1.03. Incorporation by Reference of Trust Indenture
Act. This Indenture is subject to the mandatory provisions of the TIA, which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities and any Subsidiary
Guarantees.
"indenture security holder" means a Holder or Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" on the indenture securities means the Company, any
Subsidiary Guarantors and any other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by SEC rule have
the meanings assigned to them by such definitions.
SECTION 1.04. Rules of Construction. Unless the context
otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) "including" means including without limitation;
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(5) words in the singular include the plural and words in the
plural include the singular;
(6) unsecured Indebtedness shall not be deemed to be
subordinate or junior to Secured Indebtedness merely by virtue of its
nature as unsecured Indebtedness;
(7) the principal amount of any noninterest bearing or other
discount security at any date shall be the principal amount thereof
that would be shown on a balance sheet of the issuer dated such date
prepared in accordance with GAAP;
(8) the principal amount of any Preferred Stock shall be (i)
the maximum liquidation value of such Preferred Stock or (ii) the
maximum mandatory redemption or mandatory repurchase price with respect
to such Preferred Stock, whichever is greater.
ARTICLE 2
The Securities
SECTION 2.01. Amount of Securities; Issuable in Series. The
aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is $311,000,000. The Securities may be issued in
one or more series. All Securities of any one series shall be substantially
identical except as to denomination.
With respect to any Additional Securities issued after the
Closing Date (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other Securities
pursuant to Section 2.07, 2.08, 2.09, 2.10 or 3.06 or the Appendix), there shall
be (i) established in or pursuant to a resolution of the Board of Directors and
(ii) (A) set forth or determined in the manner provided in an Officers'
Certificate or (B) established in one or more indentures supplemental hereto,
prior to the issuance of such Additional Securities:
(1) whether such Additional Securities shall be issued as part
of a new or existing series of Securities and the title of such
Additional Securities (which shall distinguish the Additional
Securities of the series from Securities of any other series);
(2) the aggregate principal amount of such Additional
Securities which may be authenticated and delivered under this
Indenture, which shall be in an aggregate principal amount not to
exceed $50,000,000 (except for Securities authenticated and delivered
upon registration of transfer of, or in exchange for, or in lieu of,
other Securities of the same series pursuant to Section 2.07, 2.08,
2.09, 2.10 or 3.06 or the Appendix and except for Securities which,
pursuant to Section 2.03, are deemed never to have been authenticated
and delivered hereunder);
(3) the issue price and issuance date of such Additional
Securities, including the date from which interest on such Additional
Securities shall accrue; provided; however, that no Additional
Securities may be issued at a price that
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would cause such Additional Securities to have "original issue
discount" within the meaning of Section 1273 of the Code;
(4) if applicable, that such Additional Securities shall be
issuable in whole or in part in the form of one or more Global
Securities (as defined in the Appendix) and, in such case, the
respective depositaries for such Global Securities, the form of any
legend or legends which shall be borne by such Global Securities in
addition to or in lieu of those set forth in Exhibit A hereto and any
circumstances in addition to or in lieu of those set forth in Section
2.3 of the Appendix in which any such Global Security may be exchanged
in whole or in part for Additional Securities registered, or any
transfer of such Global Security in whole or in part may be registered,
in the name or names of Persons other than the depositary for such
Global Security or a nominee thereof; and
(5) if applicable, that such Additional Securities shall not
be issued in the form of Initial Securities as set forth in Exhibit A,
but shall be issued in the form of Exchange Securities as set forth in
Exhibit B.
If any of the terms of any Additional Securities are
established by action taken pursuant to a resolution of the Board of Directors,
a copy of an appropriate record of such action shall be certified by the
Secretary or any Assistant Secretary of the Company and delivered to the Trustee
at or prior to the delivery of the Officers' Certificate or the indenture
supplemental hereto setting forth the terms of the Additional Securities.
SECTION 2.02. Form and Dating. Provisions relating to the
Original Securities, the Additional Securities, the Private Exchange Securities
and the Exchange Securities are set forth in the Appendix, which is hereby
incorporated in and expressly made a part of this Indenture. The (i) Original
Securities and the Trustee's certificate of authentication, (ii) Private
Exchange Securities and the Trustee's certificate of authentication and (iii)
any Additional Securities (if issued as Transfer Restricted Securities (as
defined in the Appendix)) and the Trustee's certificate of authentication shall
each be substantially in the form of Exhibit A hereto, which is hereby
incorporated in and expressly made a part of this Indenture. The Exchange
Securities and any Additional Securities issued other than as Transfer
Restricted Securities and the Trustee's certificate of authentication shall each
be substantially in the form of Exhibit B hereto, which is hereby incorporated
in and expressly made a part of this Indenture. The Securities may have
notations, legends or endorsements required by law, stock exchange rule,
agreements to which the Company or any Subsidiary Guarantor is subject, if any,
or usage (provided that any such notation, legend or endorsement is in a form
acceptable to the Company). Each Security shall be dated the date of its
authentication. The Securities shall be issuable only in registered form without
coupons and only in denominations of $1,000 and integral multiples thereof.
SECTION 2.03. Execution and Authentication. One or more
Officers 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 Trustee authenticates the Security, the Security
shall be valid nevertheless.
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A Security shall not be valid until an authorized signatory of
the Trustee manually signs the certificate of authentication on the Security.
The signature shall be conclusive evidence that the Security has been
authenticated under this Indenture.
The Trustee shall authenticate and make available for delivery
Securities as set forth in the Appendix.
The Trustee may appoint an authenticating agent reasonably
acceptable to the Company to authenticate the Securities. Any such appointment
shall be evidenced by an instrument signed by a Trust Officer, a copy of which
shall be furnished to the Company. 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 any Registrar, Paying Agent or agent for service of notices and
demands.
SECTION 2.04. Registrar and Paying Agent. The Company shall
maintain an office or agency where Securities may be presented for registration
of transfer or for exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying Agent"). The Registrar
shall keep a register of the Securities and of their transfer and exchange. The
Company may have one or more co-registrars and one or more additional paying
agents. The term "Paying Agent" includes any additional paying agent, and the
term "Registrar" includes any co-registrars. The Company initially appoints the
Trustee as (i) Registrar and Paying Agent in connection with the Securities and
(ii) the Securities Custodian (as defined in the Appendix) with respect to the
Global Securities.
The Company shall enter into an appropriate agency agreement
with any Registrar or Paying Agent not a party to this Indenture, which shall
incorporate the terms of the TIA. The agreement shall 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
maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be
entitled to appropriate compensation therefor pursuant to Section 7.07. The
Company or any of its domestically organized Wholly Owned Subsidiaries may act
as Paying Agent or Registrar.
The Company may remove any Registrar or Paying Agent upon
written notice to such Registrar or Paying Agent and to the Trustee; provided,
however, that no such removal shall become effective until (1) acceptance of an
appointment by a successor as evidenced by an appropriate agreement entered into
by the Company and such successor Registrar or Paying Agent, as the case may be,
and delivered to the Trustee or (2) notification to the Trustee that the Trustee
shall serve as Registrar or Paying Agent until the appointment of a successor in
accordance with clause (1) above. The Registrar or Paying Agent may resign at
any time upon written notice; provided, however, that the Trustee may resign as
Paying Agent or Registrar only if the Trustee also resigns as Trustee in
accordance with Section 7.08.
SECTION 2.05. Paying Agent To Hold Money in Trust. Prior to
each due date of the principal and interest on any Security, the Company shall
deposit with the Paying Agent (or if the Company or a Subsidiary is acting as
Paying Agent, segregate and hold in trust for the benefit of the Persons
entitled thereto) a sum sufficient to pay
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such principal and interest when so becoming due. The Company shall require each
Paying Agent (other than the Trustee) to agree in writing that the Paying Agent
shall hold in trust for the benefit of Securityholders or the Trustee all money
held by the Paying Agent for the payment of principal of or interest on the
Securities and shall notify the Trustee of any default by the Company in making
any such payment. If the Company or a Subsidiary of the Company acts as Paying
Agent, it shall segregate the money held by it as Paying Agent and hold it as a
separate trust fund. The Company at any time may require a Paying Agent to pay
all money held by it to the Trustee and to account for any funds disbursed by
the Paying Agent. Upon complying with this Section 2.05, the Paying Agent shall
have no further liability for the money delivered to the Trustee.
SECTION 2.06. 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. If the Trustee is not the
Registrar, the Company shall furnish, or cause the Registrar to furnish, to the
Trustee, in writing at least five 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.
SECTION 2.07. Transfer and Exchange. The Securities shall be
issued in registered form and shall be transferable only upon the surrender of a
Security for registration of transfer and in compliance with the Appendix. When
a Security is presented to the Registrar with a request to register a transfer,
the Registrar shall register the transfer as requested if the requirements of
Section 8-401(a) of the Uniform Commercial Code are met. When Securities are
presented to the Registrar with a request to exchange them for an equal
principal amount of Securities of other denominations, the Registrar shall make
the exchange as requested if the requirements of Section 8-401(a)(1) and (2) of
the Uniform Commercial Code are met. To permit registration of transfers and
exchanges, the Company shall execute and the Trustee shall authenticate
Securities at the Registrar's request. The Company may require payment of a sum
sufficient to pay all taxes, assessments or other governmental charges in
connection with any transfer or exchange pursuant to this Section 2.07. The
Company shall not be required to make and the Registrar need not register
transfers or exchanges of Securities selected for redemption (except, in the
case of Securities to be redeemed in part, the portion thereof not to be
redeemed) or any Securities for a period of 15 days before a selection of
Securities to be redeemed.
Prior to the due presentation for registration of transfer of
any Security, the Company, the Subsidiary Guarantors, if any, the Trustee, the
Paying Agent and the Registrar may deem and treat the Person in whose name a
Security is registered as the absolute owner of such Security for the purpose of
receiving payment of principal of and interest, if any, on such Security and for
all other purposes whatsoever, whether or not such Security is overdue, and none
of the Company, any Subsidiary Guarantor, the Trustee, the Paying Agent or the
Registrar shall be affected by notice to the contrary.
Any Holder of a Global Security shall, by acceptance of such
Global Security, agree that transfers of beneficial interest in such Global
Security may be effected only through a book-entry system maintained by (i) the
Holder of such Global Security (or its agent) or (ii) any Holder of a beneficial
interest in such Global Security, and that ownership of a beneficial interest in
such Global Security shall be required to be reflected in a book entry.
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All Securities issued upon any transfer or exchange pursuant
to the terms of this Indenture shall evidence the same debt and shall be
entitled to the same benefits under this Indenture as the Securities surrendered
upon such transfer or exchange.
SECTION 2.08. Replacement Securities. If a mutilated Security
is surrendered to the Registrar or if the Holder of a Security claims that the
Security has been lost, destroyed or wrongfully taken, the Company shall issue
and the Trustee shall authenticate a replacement Security if the requirements of
Section 8-405 of the Uniform Commercial Code are met, such that the Holder (i)
notifies the Company or the Trustee within a reasonable time after he has notice
of such loss, destruction or wrongful taking, and the Registrar does not
register a transfer prior to receiving such notification, (ii) makes such
request to the Company or the Trustee prior to the Security being acquired by a
protected purchaser as defined in Section 8-303 of the Uniform Commercial Code
(a "protected purchaser") and (iii) satisfies any other reasonable requirements
of the Trustee. If required by the Trustee or the Company, such Holder shall
furnish an indemnity bond sufficient in the judgment of the Trustee to protect
the Company, the Trustee, the Paying Agent and the Registrar from any loss that
any of them may suffer if a Security is replaced. The Company and the Trustee
may charge the Holder for their expenses in replacing a Security. In the event
any such mutilated, lost, destroyed or wrongfully taken Security has become or
is about to become due and payable, the Company in its discretion may pay such
Security instead of issuing a new Security in replacement thereof.
Every replacement Security is an additional obligation of the
Company.
The provisions of this Section 2.08 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, lost, destroyed or wrongfully taken
Securities.
SECTION 2.09. Outstanding Securities. Securities outstanding
at any time are all Securities authenticated by the Trustee except for those
canceled by it, those delivered to it for cancelation and those described in
this Section as not outstanding. Subject to Section 11.06, a Security does not
cease to be outstanding because the Company or an Affiliate of the Company holds
the Security.
If a Security is replaced pursuant to Section 2.08, it ceases
to be outstanding unless the Trustee and the Company receive proof satisfactory
to them that the replaced Security is held by a protected purchaser.
If the Paying Agent segregates and holds in trust, in
accordance with this Indenture, on a redemption date or maturity date money
sufficient to pay all principal and interest payable on that date with respect
to the Securities (or portions thereof) to be redeemed or maturing, as the case
may be, then on and after that date such Securities (or portions thereof) cease
to be outstanding and interest on them ceases to accrue.
SECTION 2.10. Temporary Securities. In the event that
Definitive Securities (as defined in the Appendix) are to be issued under the
terms of this Indenture, until such Definitive Securities are ready for
delivery, the Company may prepare and the Trustee shall authenticate temporary
Securities. Temporary Securities shall be substantially in the form of
Definitive Securities but may have variations that the Company considers
appropriate for temporary Securities. Without unreasonable delay, the
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Company shall prepare and the Trustee shall authenticate Definitive Securities
and deliver them in exchange for temporary Securities upon surrender of such
temporary Securities at the office or agency of the Company, without charge to
the Holder.
SECTION 2.11. Cancelation. The Company at any time may deliver
Securities to the Trustee for cancelation. The Registrar and the Paying Agent
shall forward to the Trustee any Securities surrendered to them for registration
of transfer, exchange or payment. The Trustee and no one else shall cancel all
Securities surrendered for registration of transfer, exchange, payment or
cancelation and deliver canceled Securities to the Company pursuant to written
direction by an Officer. The Company may not issue new Securities to replace
Securities it has redeemed, paid or delivered to the Trustee for cancelation.
The Trustee shall not authenticate Securities in place of canceled Securities
other than pursuant to the terms of this Indenture.
SECTION 2.12. Defaulted Interest. If the Company defaults in a
payment of interest on the Securities, the Company shall pay the defaulted
interest (plus interest on such defaulted interest to the extent lawful) in any
lawful manner. The Company may pay the defaulted interest to the Persons who are
Securityholders on a subsequent special record date. The Company shall fix or
cause to be fixed any such special record date and payment date to the
reasonable satisfaction of the Trustee and shall promptly mail or cause to be
mailed to each Securityholder a notice that states the special record date, the
payment date and the amount of defaulted interest to be paid.
SECTION 2.13. CUSIP Numbers. The Company in issuing the
Securities may use "CUSIP" numbers (if then generally in use) and, if so, the
Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to
Holders; provided, however, that any such notice may state that no
representation is made as to the correctness of such numbers either as printed
on the Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on the
Securities, and any such redemption shall not be affected by any defect in or
omission of such numbers.
ARTICLE 3
Redemption
SECTION 3.01. Notices to Trustee. If the Company elects to
redeem Securities pursuant to paragraph 5 of the Securities, it shall notify the
Trustee in writing of the redemption date and the principal amount of Securities
to be redeemed.
The Company shall give each notice to the Trustee provided for
in this Section 3.01 at least 60 days before the redemption date unless the
Trustee consents to a shorter period. Such notice shall be accompanied by an
Officers' Certificate and an Opinion of Counsel from the Company to the effect
that such redemption will comply with the conditions herein. If fewer than all
the Securities are to be redeemed, the record date relating to such redemption
shall be selected by the Company and given to the Trustee, which record date
shall be not fewer than 15 days after the date of notice to the Trustee. Any
such notice may be canceled at any time prior to notice of such redemption being
mailed to any Holder and shall thereby be void and of no effect.
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SECTION 3.02. Selection of Securities To Be Redeemed. If fewer
than all the Securities are to be redeemed, the Trustee shall select the
Securities to be redeemed pro rata or by lot or by a method that complies with
applicable legal and securities exchange requirements, if any, and that the
Trustee in its sole discretion shall deem to be fair and appropriate and in
accordance with methods generally used at the time of selection by fiduciaries
in similar circumstances. The Trustee shall make the selection from outstanding
Securities not previously called for redemption. The Trustee may select for
redemption portions of the principal of Securities that have denominations
larger than $1,000. Securities and portions of them the Trustee selects shall be
in amounts of $1,000 or a whole multiple of $1,000. Provisions of this Indenture
that apply to Securities called for redemption also apply to portions of
Securities called for redemption. The Trustee shall notify the Company promptly
of the Securities or portions of Securities to be redeemed.
SECTION 3.03. Notice of Redemption. At least 30 days but not
more than 60 days before a date for redemption of Securities, the Company shall
mail a notice of redemption by first-class mail to each Holder of Securities to
be redeemed at such Holder's registered address.
The notice shall identify the Securities to be redeemed and
shall state:
(1) the redemption date;
(2) the redemption price and the amount of accrued interest to
the redemption date;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be surrendered
to the Paying Agent to collect the redemption price;
(5) if fewer than all the outstanding Securities are to be
redeemed, the certificate numbers and principal amounts of the
particular Securities to be redeemed;
(6) that, unless the Company defaults in making such
redemption payment or the Paying Agent is prohibited from making such
payment pursuant to the terms of this Indenture, interest on Securities
(or portion thereof) called for redemption ceases to accrue on and
after the redemption date;
(7) the CUSIP number, if any, printed on the Securities being
redeemed; and
(8) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed
on the Securities.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense. In such event,
the Company shall provide the Trustee with the information required by this
Section.
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SECTION 3.04. Effect of Notice of Redemption. Once notice of
redemption is mailed, Securities called for redemption become due and payable on
the redemption date and at the redemption price stated in the notice. Upon
surrender to the Paying Agent, such Securities shall be paid at the redemption
price stated in the notice, plus accrued interest, if any, to the redemption
date; provided, however, that if the redemption date is after a regular record
date and on or prior to the interest payment date, the accrued interest shall be
payable to the Securityholder of the redeemed Securities registered on the
relevant record date. Failure to give notice or any defect in the notice to any
Holder shall not affect the validity of the notice to any other Holder.
SECTION 3.05. Deposit of Redemption Price. Prior to 10:00 a.m.
on the redemption date, the Company shall deposit with the Paying Agent (or, if
the Company or a Subsidiary is the Paying Agent, shall segregate and hold in
trust) money sufficient to pay the redemption price of and accrued interest on
all Securities to be redeemed on that date other than Securities or portions of
Securities called for redemption that have been delivered by the Company to the
Trustee for cancelation.
SECTION 3.06. Securities Redeemed in Part. Upon surrender of a
Security that is redeemed in part, the Company shall execute and the Trustee
shall authenticate for the Holder (at the Company's expense) a new Security
equal in principal amount to the unredeemed portion of the Security surrendered.
ARTICLE 4
Covenants
SECTION 4.01. Payment of Securities. The Company shall
promptly pay the principal of and interest on the Securities on the dates and in
the manner provided in the Securities and in this Indenture. Principal and
interest shall be considered paid on the date due if on such date the Trustee or
the Paying Agent holds in accordance with this Indenture money sufficient to pay
all principal and interest then due and the Trustee or the Paying Agent, as the
case may be, is not prohibited from paying such money to the Securityholders on
that date pursuant to the terms of this Indenture.
The Company shall pay interest on overdue principal at the
rate specified therefor in the Securities, and it shall pay interest on overdue
installments of interest at the same rate to the extent lawful.
SECTION 4.02. SEC Reports. Notwithstanding that the Company
may not be subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act the Company shall file with the SEC and provide the Trustee and
Securityholders and prospective Securityholders (upon request) within 15 days
after it files them with the SEC, copies of its annual report and the
information, documents and other reports that are specified in Sections 13 and
15(d) of the Exchange Act. In addition, following a public offering of the
common stock of the Company, the Company shall furnish to the Trustee and the
Securityholders, promptly upon their becoming available, copies of the annual
report to stockholders and any other information provided by the Company to its
public stockholders generally. The Company also shall comply with the other
provisions of Section 314(a) of the TIA.
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SECTION 4.03. Limitation on Indebtedness. (a) The Company
shall not, and shall not permit any Restricted Subsidiary to, Incur, directly or
indirectly, any Indebtedness; provided, however, that the Company may Incur
Indebtedness if on the date of such Incurrence and after giving effect thereto
the Debt to Annualized Operating Cash Flow Ratio would be less than or equal to
6.0:1.0 if such Indebtedness is Incurred prior to July 15, 2001 and less than or
equal to 5.5:1.0 if such Indebtedness is Incurred on or after such date.
(b) Notwithstanding Section 4.03(a), the Company and its Restricted
Subsidiaries may Incur the following Indebtedness:
(i) Bank Indebtedness in an aggregate principal amount not to
exceed $75.0 million less the aggregate amount of all repayments of
principal applied to permanently reduce any such Indebtedness;
(ii) Indebtedness of the Company owed to and held by any
Wholly Owned Subsidiary or Indebtedness of a Restricted Subsidiary owed
to and held by the Company or any Wholly Owned Subsidiary; provided,
however, that (i) any subsequent issuance or transfer of any Capital
Stock or any other event that 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 a Wholly
Owned Subsidiary) shall be deemed, in each case, to constitute the
Incurrence of such Indebtedness by the issuer thereof and (ii) if the
Company is the obligor on such Indebtedness, such Indebtedness is
expressly subordinated to the prior payment in full in cash of all
obligations with respect to the Securities;
(iii) Indebtedness (A) represented by the Securities (not
including any Additional Securities), (B) outstanding on the Closing
Date (other than the Indebtedness described in clauses (i) and (ii)
above), (C) consisting of Refinancing Indebtedness Incurred in respect
of any Indebtedness described in this clause (iii) (including
Indebtedness Refinancing Refinancing Indebtedness) or Section 4.03(a),
(D) consisting of Guarantees of any Indebtedness permitted under
clauses (i) and (ii) of this paragraph (b) and (E) consisting of any
Guarantees of the Securities;
(iv) (A) Indebtedness of a Restricted Subsidiary Incurred and
outstanding on or prior to the date on which such Restricted Subsidiary
was acquired by the Company (other than Indebtedness Incurred as
consideration in, 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 Subsidiary of or was otherwise acquired by the Company);
provided, however, that on the date that such Restricted Subsidiary is
acquired by the Company, the Company would have been able to Incur
$1.00 of additional Indebtedness pursuant to Section 4.03(a) after
giving effect to the Incurrence of such Indebtedness pursuant to this
clause (iv) and (B) Refinancing Indebtedness Incurred by a Restricted
Subsidiary in respect of Indebtedness Incurred by such Restricted
Subsidiary pursuant to this clause (iv);
(v) Indebtedness (A) in respect of performance bonds, bankers'
acceptances, letters of credit and surety or appeal bonds provided by
the Company and the Restricted Subsidiaries in the ordinary course of
their business and
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(B) under Hedging Obligations entered into for bona fide hedging
purposes of the Company in the ordinary course of business; provided,
however, that such Hedging Obligations do not increase the Indebtedness
of the Company outstanding at any time other than as a result of
fluctuations in interest rates or currency exchange rates or by reason
of fees, indemnities and compensation payable thereunder;
(vi) Purchase Money Indebtedness, provided that the amount of
such Purchase Money Indebtedness does not exceed the lesser of 80% of
(a) the Fair Market Value of or (b) the cost of the construction,
installation, acquisition, lease, development or improvement of, the
applicable Telecommunications Assets;
(vii) Contribution Indebtedness; or
(viii) Indebtedness (other than Indebtedness permitted to be
Incurred pursuant to Section 4.03(a) or any other clause of this
Section 4.03(b)) in an aggregate principal amount on the date of
Incurrence that, when added to all other Indebtedness Incurred pursuant
to this clause (viii) and then outstanding, shall not exceed $40.0
million.
(c) Notwithstanding the foregoing, the Company may not Incur any
Indebtedness pursuant to Section 4.03(b) if the proceeds thereof are used,
directly or indirectly, to repay, prepay, redeem, defease, retire, refund or
refinance any Subordinated Obligations unless such Indebtedness will be
subordinated to the Securities to at least the same extent as such Subordinated
Obligations.
(d) Notwithstanding any other provision of this Section 4.03, the
maximum amount of Indebtedness that the Company or any Restricted Subsidiary may
Incur pursuant to this Section 4.03 shall not be deemed to be exceeded solely as
a result of fluctuations in the exchange rates of currencies. For purposes of
determining the outstanding principal amount of any particular Indebtedness
Incurred pursuant to this Section 4.03, (i) Indebtedness permitted by this
Section 4.03 need not be permitted solely by reference to one provision
permitting such Indebtedness but may be permitted in part by one such provision
and in part by one or more other provisions of this Section 4.03 permitting such
Indebtedness and (ii) in the event that Indebtedness meets the criteria of more
than one of the types of Indebtedness described in Section 4.03(b), the Company,
in its sole discretion, shall classify such Indebtedness and only be required to
include the amount of such Indebtedness in one of such clauses. Once so
classified, such Indebtedness shall retain such classification until repaid.
SECTION 4.04. Limitation on Restricted Payments. (a) The
Company shall not, and shall not permit any Restricted Subsidiary, 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 similar payment to the direct
or indirect holders of its Capital Stock except dividends or distributions
payable solely in its Capital Stock (other than Disqualified Stock) and except
dividends or distributions payable to the Company or another Restricted
Subsidiary (and, if such Restricted Subsidiary has stockholders other than the
Company or other Restricted Subsidiaries, to its other stockholders on a pro
rata basis), (ii) purchase, redeem, retire or otherwise acquire for value any
Capital Stock of the Company or any Restricted Subsidiary held by Persons other
than the Company or
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another Restricted Subsidiary, (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
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 being herein referred to
as a "Restricted Payment") if at the time the Company or such Restricted
Subsidiary makes such Restricted Payment:
(1) a Default shall have occurred and be continuing (or would
result therefrom);
(2) the Company could not Incur at least $1.00 of additional
Indebtedness pursuant to Section 4.03(a); or
(3) the aggregate amount of such Restricted Payment and all
other Restricted Payments (the amount so expended, if other than in
cash, to be determined in good faith by the Board of Directors, whose
determination shall be conclusive and evidenced by a resolution of the
Board of Directors) declared or made subsequent to the Closing Date
would exceed the sum of: (A) (i) 100% of Consolidated Operating Cash
Flow accrued during the period (treated as one accounting period) from
the beginning of the fiscal quarter immediately following the fiscal
quarter during which the Closing Date occurs to the end of the most
recent fiscal quarter ending at least 45 days prior to the date of such
Restricted Payment (or, in case such Consolidated Operating Cash Flow
during such period is a deficit, minus 100% of such deficit), minus
(ii) 150% of Consolidated Interest Expense accrued during the period
(treated as one accounting period) from the beginning of the fiscal
quarter immediately following the fiscal quarter during which the
Closing Date occurs to the end of the most recent fiscal quarter ending
at least 45 days prior to the date of such Restricted Payment; plus,
(B) the aggregate Net Cash Proceeds received by the Company from the
issue or sale of its Capital Stock (other than Disqualified Stock)
subsequent to the Closing Date (other than an issuance or sale to (x) a
Subsidiary of the Company or (y) an employee stock ownership plan or
other trust established by the Company or any of its Subsidiaries);
plus, (C) the amount by which Indebtedness of the Company or its
Restricted Subsidiaries is reduced on the Company's balance sheet upon
the conversion or exchange (other than by a Subsidiary of the Company)
subsequent to the Closing Date of any Indebtedness of the Company or
its Restricted Subsidiaries issued after the Closing Date which is
convertible or exchangeable for Capital Stock (other than Disqualified
Stock) of the Company (less the amount of any cash or the fair market
value of other property distributed by the Company or any Restricted
Subsidiary upon such conversion or exchange); plus, (D) the amount
equal to the net reduction in Investments in Unrestricted Subsidiaries
resulting from (i) payments of dividends, repayments of the principal
of loans or advances or other transfers of assets to the Company or any
Restricted Subsidiary from Unrestricted Subsidiaries or (ii) the
redesignation of Unrestricted Subsidiaries as Restricted Subsidiaries
(valued in each case as provided in the definition of "Investment") not
to exceed, in the case of any Unrestricted Subsidiary, the amount of
Investments previously made by the Company or any
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Restricted Subsidiary in such Unrestricted Subsidiary, which amount was
included in the calculation of the amount of Restricted Payments; and
less, (E) the aggregate principal amount of any outstanding
Contribution Indebtedness or, if less, the Cash Contribution Amount.
(b) The provisions of Section 4.04(a) shall not prohibit: (i) any
purchase, repurchase, retirement or other acquisition or retirement for value of
Capital Stock 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
of the Company or an employee stock ownership plan or other trust established by
the Company or any of its Subsidiaries); provided, however, that such purchase,
repurchase, retirement or other acquisition or retirement for value shall be
excluded in the calculation of the amount of Restricted Payments; (ii) any
purchase, repurchase, redemption, defeasance or other acquisition or retirement
for value of Subordinated Obligations of the Company made by exchange for, or
out of the proceeds of the substantially concurrent sale of, Indebtedness of the
Company that is permitted to be Incurred pursuant to Section 4.03(b) or Capital
Stock of the Company (other than Disqualified Stock and other than Capital Stock
issued or sold to a Subsidiary of the Company or an employee stock ownership
plan or other trust established by the Company or any of its Subsidiaries);
provided, however, that such purchase, repurchase, redemption, defeasance or
other acquisition or retirement for value 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 by
Section 4.06; provided, however, that such purchase or redemption shall be
included in the calculation of the amount of Restricted Payments; (iv) dividends
paid within 60 days after the date of declaration thereof if at such date of
declaration such dividend would have complied with this Section 4.04; provided,
however, that such dividend shall be included in the calculation of the amount
of Restricted Payments; or (v) the repurchase or other acquisition of shares of,
or options to purchase shares of, common stock of the Company or any of its
Subsidiaries from employees, former employees, directors or former directors of
the Company or any of its Subsidiaries (or permitted transferees of such
employees, former employees, directors or former directors), pursuant to the
terms of agreements (including employment agreements) or plans (or amendments
thereto) approved by the Board of Directors under which such individuals
purchase or sell or are granted the option to purchase or sell, shares of such
common stock; provided, however, that the aggregate amount of such repurchases
shall not exceed $1.0 million in any calendar year and $3.0 million in the
aggregate; provided further, that such repurchases and other acquisitions shall
be included in the calculation of the amount of Restricted Payments.
SECTION 4.05. Limitation on Restrictions on Distributions from
Restricted Subsidiaries. The Company shall not, and shall not permit any
Restricted Subsidiary to, create or otherwise cause or permit to exist or become
effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to (i) pay dividends or make any other distributions on
its Capital Stock or pay any Indebtedness or other obligations 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:
(1) any encumbrance or restriction pursuant to (A) an
agreement in effect at or entered into on the Closing Date or (B) an
agreement entered into in connection with the Incurrence of
Indebtedness permitted under clause (b)(i) or
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(b)(vi) of Section 4.03, provided that the chief financial officer of
the Company has determined in good faith that any restriction incurred
pursuant to this clause (B) is customary for similar Incurrences of
Indebtedness;
(2) any encumbrance or restriction with respect to a
Restricted Subsidiary pursuant to an agreement relating to any
Indebtedness Incurred by such Restricted Subsidiary prior to the date
on which such Restricted Subsidiary was acquired by the Company (other
than Indebtedness Incurred as consideration in, in contemplation 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 or was otherwise acquired by the Company) and
outstanding on such date;
(3) any encumbrance or restriction pursuant to an agreement
effecting a Refinancing of Indebtedness Incurred pursuant to an
agreement referred to in clause (1) or (2) of this Section 4.05 or this
clause (3) or contained in any amendment to an agreement referred to in
clause (1) or (2) of this Section 4.05 or this clause (3); provided,
however, that the encumbrances and restrictions contained in any such
refinancing agreement or amendment are no less favorable to the
Securityholders than the encumbrances and restrictions contained in
such predecessor agreements;
(4) 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 subject to a
lease, license or similar contract, or (B) contained in security
agreements securing Indebtedness of a Restricted Subsidiary to the
extent such encumbrance or restriction restricts the transfer of the
property subject to such security agreements; and
(5) with respect to a Restricted Subsidiary, any restriction
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.
SECTION 4.06. Limitation on Sales of Assets and Subsidiary
Stock. (a) The Company shall not, and shall not permit any Restricted Subsidiary
to, make any Asset Disposition unless (i) the Company or such Restricted
Subsidiary receives consideration (including by way of relief from, or by any
other Person assuming sole responsibility for, any liabilities, contingent or
otherwise) at the time of such Asset Disposition at least equal to the Fair
Market Value of the shares and assets subject to such Asset Disposition, (ii) at
least 75% of the consideration thereof received by the Company or such
Restricted Subsidiary is in the form of cash or cash equivalents 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 elects (or is required by the terms of any Bank
Indebtedness) to (x) reinvest in Telecommunications Assets (including by means
of an Investment in Telecommunications Assets by a Restricted Subsidiary with
Net Available Cash received by the Company or another Restricted Subsidiary) or
(y) prepay, repay, redeem or purchase Bank Indebtedness of the Company Incurred
pursuant to Section 4.03(b)(i), in each case within 180 days after the later of
the date of such Asset Disposition or the receipt of such Net Available Cash;
(B) second, to the extent of the balance of such Net
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Available Cash after application in accordance with clause (A), to make an Offer
(as defined below) to purchase Securities pursuant to and subject to the
conditions set forth in Section 4.06(c) within 365 days after the later of such
Asset Disposition or the receipt of such Net Available Cash; provided, however,
that if the Company elects (or is required by the terms of any other Senior
Indebtedness), such Offer may be made ratably to purchase the Securities and
other Senior Indebtedness of the Company, and (C) third, to fund (to the extent
consistent with any other applicable provision in this Indenture) any corporate
purpose. Notwithstanding the foregoing provisions of this Section 4.06, the
Company and the Restricted Subsidiaries shall not be required to apply any Net
Available Cash in accordance with this Section 4.06 except to the extent that
the aggregate Net Available Cash from all Asset Dispositions that is not applied
in accordance with this Section 4.06 exceeds $5.0 million.
(b) For the purposes of this Section 4.06, the following are deemed to
be cash: (x) the assumption of Indebtedness of the Company (other than
Disqualified Stock of the Company) or any Restricted Subsidiary and the release
of the Company or such Restricted Subsidiary from all liability on such
Indebtedness in connection with such Asset Disposition and (y) securities
received by the Company or any Restricted Subsidiary from the transferee that
are converted by the Company or such Restricted Subsidiary into cash within 60
days of such receipt.
(c) In the event of an Asset Disposition that requires the purchase of
Securities (and other Senior Indebtedness) pursuant to Section 4.06(a)(iii)(B),
the Company shall be required to purchase Securities (and other Senior
Indebtedness) tendered pursuant to an offer by the Company for the Securities
(and other Senior Indebtedness) (the "Offer") at a purchase price of 100% of
their principal amount plus accrued and unpaid interest and liquidated damages,
if any, to the date of purchase in accordance with the procedures (including
prorating in the event of oversubscription) set forth in Section 4.06(d). If the
aggregate purchase price of Securities (and other Senior Indebtedness) tendered
pursuant to the Offer is less than the Net Available Cash allotted to the
purchase of the Securities (and other Senior Indebtedness), the Company may
apply the remaining Net Available Cash in accordance with Section
4.06(a)(iii)(C). The Company shall not be required to make an Offer for
Securities (and other Senior Indebtedness) pursuant to this Section 4.06 if the
Net Available Cash available therefor (after application of the proceeds as
provided in Section 4.06(a)(iii)(A)) is less than $5.0 million for any
particular Asset Disposition (which lesser amount 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).
(d) (1) Promptly, and in any event within 10 days after the Company
becomes obligated to make an Offer, the Company shall be obligated to deliver to
the Trustee and send, by first-class mail to each Holder, a written notice
stating that the Holder may elect to have his Securities purchased by the
Company either in whole or in part (subject to prorationing as hereinafter
described in the event the Offer is oversubscribed) in integral multiples of
$1,000 of principal amount, at the applicable purchase price. The notice shall
specify a purchase date not less than 30 days nor more than 60 days after the
date of such notice (the "Purchase Date") and shall contain such information
concerning the business of the Company which the Company in good faith believes
will enable such Holders to make an informed decision (which at a minimum shall
include (i) the most recently filed Annual Report on Form 10-K (including
audited consolidated financial statements) of the Company, the most recent
subsequently filed Quarterly Report on
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Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to
such Quarterly Report, other than Current Reports describing Asset Dispositions
otherwise described in the offering materials (or corresponding successor
reports), (ii) a description of material developments in the Company's business
subsequent to the date of the latest of such reports, and (iii) if material,
appropriate pro forma financial information) and all instructions and materials
necessary to tender Securities pursuant to the Offer, together with the address
referred to in clause (3) below.
(2) Not later than the date upon which written notice of an
Offer is delivered to the Trustee as provided above, the Company shall deliver
to the Trustee an Officers' Certificate as to (i) the amount of the Offer (the
"Offer Amount"), (ii) the allocation of the Net Available Cash from the Asset
Dispositions pursuant to which such Offer is being made and (iii) the compliance
of such allocation with the provisions of Section 4.06(a). On such date, the
Company shall also irrevocably deposit with the Trustee or with a Paying Agent
(or, if the Company is acting as its own Paying Agent, segregate and hold in
trust) an amount equal to the Offer Amount to be invested in Temporary Cash
Investments and to be held for payment in accordance with the provisions of
this Section. Upon the expiration of the period for which the Offer remains open
(the "Offer Period"), the Company shall deliver to the Trustee for cancelation
the Securities or portions thereof that have been properly tendered to and are
to be accepted by the Company. The Trustee (or the Paying Agent, if not the
Trustee) shall, on the date of purchase, mail or deliver payment to each
tendering Holder in the amount of the purchase price. In the event that the
aggregate purchase price of the Securities delivered by the Company to the
Trustee is less than the Offer Amount applicable to the Securities, the Trustee
shall deliver the excess to the Company immediately after the expiration of the
Offer Period for application in accordance with this Section 4.06.
(3) Holders electing to have a Security purchased shall be
required to surrender the Security, with an appropriate form duly completed, to
the Company at the address specified in the notice at least three Business Days
prior to the Purchase Date. Holders shall be entitled to withdraw their election
if the Trustee or the Company receives not later than one Business Day prior to
the Purchase Date, a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the Security which was
delivered by the Holder for purchase and a statement that such Holder is
withdrawing his election to have such Security purchased. If at the expiration
of the Offer Period the aggregate principal amount of Securities included in the
Offer surrendered by holders thereof 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 Securities in
denominations of $1,000, or integral multiples thereof, shall be purchased).
Holders whose Securities are purchased only in part will be issued new
Securities equal in principal amount to the unpurchased portion of the
Securities surrendered.
(4) At the time the Company delivers Securities to the Trustee
which are to be accepted for purchase, the Company shall also deliver an
Officers' Certificate stating that such Securities are to be accepted by the
Company pursuant to and in accordance with the terms of this Section. A Security
shall be deemed to have been accepted for purchase at the time the Trustee,
directly or through an agent, mails or delivers payment therefor to the
surrendering Holder.
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(d) The Company shall 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
this Section 4.06. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section, the Company shall comply
with the applicable securities laws and regulations and shall not be deemed to
have breached its obligations under this Section by virtue thereof.
SECTION 4.07. Limitation on Transactions with Affiliates. (a)
The Company shall not, and shall not permit any Restricted Subsidiary to,
directly or indirectly, enter into or conduct any transaction (including the
purchase, sale, lease or exchange of any property or the rendering of any
service) with any Affiliate of the Company (an "Affiliate Transaction") unless
such transaction is on terms (i) that 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) that, in the event such Affiliate Transaction
involves an aggregate amount in excess of $1.0 million, (1) are set forth in
writing and (2) have been approved by a majority of the members of the Board of
Directors having no personal stake in such Affiliate Transaction and (iii) that,
in the event such Affiliate Transaction involves an amount in excess of $20.0
million, have been determined by a nationally recognized appraisal or investment
banking firm to be fair, from a financial standpoint, to the Company and its
Restricted Subsidiaries.
(b) The provisions of Section 4.07(a) shall not prohibit (i) any
Restricted Payment permitted to be paid pursuant Section 4.04, (ii) any issuance
of securities, or other payments, awards or grants in cash, securities or
otherwise pursuant to, or the funding of, employment arrangements, stock options
and stock ownership plans approved by the Board of Directors, (iii) the grant of
stock options or similar rights to employees and directors of the Company
pursuant to plans approved by the Board of Directors, (iv) loans or advances to
employees in the ordinary course of business in accordance with past practices
of the Company, but in any event not to exceed $2.0 million in the aggregate
outstanding at any one time, (v) the payment of reasonable fees to directors of
the Company and its Subsidiaries, if any, who are not employees of the Company
or its Subsidiaries, if any, (vi) any transaction between the Company and a
Wholly Owned Subsidiary or between Wholly Owned Subsidiaries or (vii) any
transaction pursuant to, and on the terms set forth in, the Prodigy Agreement.
SECTION 4.08. Change of Control. (a) Upon the occurrence of a
Change of Control, each Holder shall have the right to require the Company to
repurchase all or any part of such Holder's Securities at a purchase price in
cash equal to 101% of the principal amount thereof plus accrued and unpaid
interest and liquidated damages, 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); provided, however, that
notwithstanding the occurrence of a Change of Control, the Company shall not be
obligated to repurchase the Securities pursuant to this Section 4.08 in the
event that it has exercised its right to redeem all the Securities under
paragraph 5 of the Securities.
(b) Within 30 days following any Change of Control, the
Company shall mail a notice to each Holder with a copy to the Trustee (the
"Change of Control Offer") stating: (1) that a Change of Control has occurred
and that such Holder has the right to require the Company to purchase such
Holder's Securities at a purchase price in cash
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equal to 101% of the principal amount thereof, plus accrued and unpaid interest
and liquidated damages, if any, to the date of repurchase (subject to the right
of Holders of record on the relevant record date to receive interest on the
relevant interest payment date); (2) the circumstances and relevant facts and
financial information regarding such Change of Control; (3) the repurchase date
(which shall be no earlier than 30 days nor later than 60 days from the date
such notice is mailed); and (4) the instructions determined by the Company,
consistent with this Section 4.08, that a Holder must follow in order to have
its Securities purchased.
(c) Holders electing to have a Security purchased shall be
required to surrender the Security, with an appropriate form duly completed, to
the Company at the address specified in the notice at least three Business Days
prior to the purchase date. Holders shall be entitled to withdraw their election
if the Trustee or the Company receives not later than one Business Day prior to
the purchase date a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the Security which was
delivered for purchase by the Holder and a statement that such Holder is
withdrawing his election to have such Security purchased.
(d) On the purchase date, all Securities purchased by the
Company under this Section 4.08 shall be delivered to the Trustee for
cancelation, and the Company shall pay the purchase price plus accrued and
unpaid interest, if any, to the Holders entitled thereto.
(e) Notwithstanding the forgoing provisions of this Section
4.08, the Company shall not be required to make a Change of Control Offer upon a
Change of Control if a third party makes the Change of Control Offer in the
manner, at the times and otherwise in compliance with the requirements set forth
in this Indenture applicable to a Change of Control Offer made by the Company
and purchases all Securities validly tendered and not withdrawn under such
Change of Control Offer.
(f) The Company shall 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
this Section 4.08. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 4.08, the Company shall
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Section 4.08 by virtue
thereof.
SECTION 4.09. Compliance Certificate. The Company shall
deliver to the Trustee within 120 days after the end of each fiscal year of the
Company an Officers' Certificate stating that in the course of the performance
by the signers of their duties as Officers of the Company they would normally
have knowledge of any Default and whether or not the signers know of any Default
that occurred during such period. If they do, the certificate shall describe the
Default, its status and what action the Company is taking or proposes to take
with respect thereto. The Company also shall comply with Section 314(a)(4) of
the TIA.
SECTION 4.10. Further Instruments and Acts. Upon request of
the Trustee, the Company shall execute and deliver such further instruments and
do such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
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SECTION 4.11. Future Subsidiary Guarantors. The Company shall
cause each Restricted Subsidiary that Incurs Indebtedness to become a Subsidiary
Guarantor by executing and delivering to the Trustee a supplemental indenture
substantially in the form of Exhibit C hereto pursuant to which such Restricted
Subsidiary shall Guarantee payment of the Securities. Each Subsidiary Guarantee
shall be limited to an amount not to exceed the maximum amount that can be
Guaranteed by that Restricted Subsidiary without rendering the Subsidiary
Guarantee, as it relates to such Restricted Subsidiary, voidable under
applicable law relating to fraudulent conveyance or fraudulent transfer or
similar laws affecting the rights of creditors generally.
SECTION 4.12. Limitation on Lines of Business. The Company
shall not, and shall not permit any Restricted Subsidiary to, engage in any
business other than a Telecommunications Business.
SECTION 4.13. Limitation on the Sale or Issuance of Capital
Stock of Restricted Subsidiaries. The Company shall not permit (a) any
Restricted Subsidiary of the Company to issue any Capital Stock except for (i)
Capital Stock issued or sold to, held by or transferred to the Company or a
Wholly Owned Subsidiary, (ii) Capital Stock issued by a Person prior to the time
(A) such Person becomes a Restricted Subsidiary of the Company, (B) such Person
merges with or into a Restricted Subsidiary of the Company or (C) a Restricted
Subsidiary of the Company merges with or into such Person; provided that such
Capital Stock was not issued or Incurred by such Person in anticipation of the
type of transaction contemplated by subclause (A), (B) or (C) (excluding for
purposes of this proviso, shares of Capital Stock issued in connection with
customary accelerated vesting provisions contained in option or similar plans or
agreements which are accelerated as a result of a change of control of such
Person and which option or similar plans or agreements were not adopted or
implemented solely in anticipation of or in connection with such transaction) or
(b) any person (other than the Company or a Wholly Owned Subsidiary) to acquire
Capital Stock of any Restricted Subsidiary of the Company from the Company or
any Restricted Subsidiary of the Company, except, in the case of each of clause
(a) or (b), (1) upon the acquisition of all the outstanding Capital Stock of
such Restricted Subsidiary in accordance with Section 4.06, (2) if, immediately
after giving effect to such issuance or sale, such Restricted Subsidiary would
no longer constitute a Restricted Subsidiary, and any Investment in such Person
remaining after giving effect to such issuance or sale would have been permitted
to be made pursuant to Section 4.04 if made on the date of such issuance or
sale, and (3) if required, the issuance, transfer, conveyance, sale or other
disposition of directors' qualifying shares.
SECTION 4.14. Limitation on Liens. The Company shall not, and
shall not permit any Restricted Subsidiary to, directly or indirectly, Incur or
permit to exist any Lien of any nature whatsoever on any of its property or
assets (including Capital Stock of a Restricted Subsidiary), whether owned at
the Closing Date or thereafter acquired, other than Permitted Liens, without
effectively providing that the Securities shall be secured equally and ratably
with (or prior to) the obligations so secured for so long as such obligations
are so secured; provided, that if such obligations are expressly subordinated to
the Securities or the Subsidiary Guarantees the Lien securing such obligations
shall be subordinated and junior to the Lien securing the Securities with the
same relative priority as such obligations have with respect to the Securities
or the Subsidiary Guarantees.
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SECTION 4.15. Limitation on Sale/Leaseback Transactions. The
Company shall not, and shall not permit any Restricted Subsidiary to, enter into
any Sale/Leaseback Transaction with respect to any property unless (a) the
Company or such Restricted Subsidiary would be entitled to (i) Incur
Indebtedness in an amount equal to the Attributable Debt with respect to such
Sale/Leaseback Transaction pursuant to Section 4.03 and (ii) create a Lien on
such property securing such Attributable Debt without equally and ratably
securing the Securities pursuant to Section 4.14, (b) the net proceeds received
by the Company or such Restricted Subsidiary in connection with such
Sale/Leaseback Transaction are at least equal to the fair market value (as
determined in good faith by the Board of Directors) of such property and (c) the
transfer of such property is permitted by, and the Company applies the proceeds
of such transaction in compliance with Section 4.06.
SECTION 4.16. Deposit of Funds with the Escrow Agent. (a) On
the Closing Date, the Company shall deposit with the Escrow Agent $54.9 million
in cash or Temporary Cash Investments that, together with the interest received
thereon, will be sufficient to pay the first four semi-annual interest payments
on the Securities. All Escrow Collateral shall be held in the Escrow Account
until permitted to be disbursed pursuant to the Escrow and Disbursement
Agreement and Section 10.03 of this Indenture and then shall be disbursed
strictly in accordance with the terms thereof.
(b) Pending release of such funds, such funds shall be
invested in Temporary Cash Investments as specifically directed in writing by
the Company. Any interest or other profit resulting from such investment shall
be deposited in the Escrow Account.
ARTICLE 5
Successor Company
SECTION 5.01. When Company May Merge or Transfer Assets. (a)
The Company shall not consolidate with or merge with or into, or convey,
transfer or lease all or substantially all its assets to, any Person, unless:
(i) the resulting, surviving or transferee Person (the
"Successor Company") will be a corporation 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)
will expressly assume, by a supplemental indenture and other
appropriate documents, executed and delivered to the Trustee, in form
satisfactory to the Trustee, all the obligations of the Company under
the Securities, this Indenture and the Escrow and Disbursement
Agreement;
(ii) immediately after giving effect to such transaction (and
treating any Indebtedness which becomes an obligation of the Successor
Company or any Restricted Subsidiary 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 shall have
occurred and be continuing;
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(iii) immediately after giving effect to such transaction, the
Successor Company would be able to Incur an additional $1.00 of
Indebtedness pursuant to Section 4.03(a);
(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 and
other appropriate documents (if any) comply with this Indenture and the
Escrow and Disbursement Agreement;
(v) the Company shall have delivered to the Trustee an
Opinion of Counsel to the effect that the Holders will not recognize
income, gain or loss for Federal income tax purposes as a result of
such transaction 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 transaction had not occurred; and
(vi) the Company shall have delivered to the Trustee an
Opinion of Counsel (subject to customary exceptions) to the effect that
any Subsidiary Guarantee shall remain in full force and effect after
such transaction.
The Successor Company shall succeed to, and be substituted for, and may
exercise every right and power of, the Company under this Indenture and the
Escrow and Disbursement Agreement, but the predecessor Company in the case of a
conveyance, transfer or lease of all or substantially all its assets shall not
be released from the obligation to pay the principal of and interest on the
Securities.
(b) The Company shall not permit any Subsidiary Guarantor to
consolidate with or merge with or into, or convey, transfer or lease, all or
substantially all of its assets to any Person unless:
(i) the resulting, surviving or transferee Person will be a
corporation organized and existing under the laws of the United States
of America, any State thereof or the District of Columbia, and such
Person (if not a Subsidiary Guarantor) will expressly assume, by a
supplemental indenture and other appropriate documents, executed and
delivered to the Trustee, in form satisfactory to the Trustee, all the
obligations of such Subsidiary Guarantor under its Subsidiary
Guarantee;
(ii) immediately after giving effect to such transaction (and
treating any Indebtedness which becomes an obligation of the resulting,
surviving or transferee Person as a result of such transaction as
having been incurred by such Person at the time of such transaction),
no Default shall have occurred and be continuing; and
(iii) 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 and
other appropriate documents (if any) comply with this Indenture.
Notwithstanding the foregoing, (a) any Restricted Subsidiary may
consolidate with, merge into or transfer all or part of its properties and
assets to the Company and
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(b) the Company may merge with an Affiliate incorporated solely for the purpose
of reincorporating the Company in another jurisdiction to realize tax or other
benefits.
ARTICLE 6
Defaults and Remedies
SECTION 6.01. Events of Default. An "Event of Default" occurs
if:
(1) the Company defaults in any payment of interest on any
Security when the same becomes due and payable and such default
continues for a period of 30 days;
(2) the Company (i) defaults in the payment of the principal
of any Security when the same becomes due and payable at its Stated
Maturity, upon redemption, upon declaration or otherwise or (ii) fails
to redeem or purchase Securities when required pursuant to this
Indenture or the Securities;
(3) the Company fails to comply with Section 5.01;
(4) the Company fails to comply with Section 4.02, 4.03, 4.04,
4.05, 4.06, 4.07, 4.08, 4.11, 4.12, 4.13, 4.14, 4.15 (other than a
failure to purchase Securities when required under Section 4.06 or
4.08) or any of its agreements contained in the Escrow and Disbursement
Agreement and such failure continues for 30 days after the notice
specified below;
(5) the Company fails to comply with any of its agreements in
the Securities or this Indenture (other than those referred to in (1),
(2), (3) or (4) above) and such failure continues for 60 days after the
notice specified below;
(6) Indebtedness of the Company or any Subsidiary is not paid
within any applicable grace period after final maturity or the
acceleration by the holders thereof because of a default and the total
amount of such Indebtedness unpaid or accelerated exceeds $5.0 million
or its foreign currency equivalent at the time and such failure
continues for 10 days after the notice specified below;
(7) the Company or any Significant Subsidiary pursuant to or
within the meaning of any Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief
against it in an involuntary case;
(C) consents to the appointment of a Custodian of it
or for any substantial part of its property; or
(D) makes a general assignment for the benefit of its
creditors;
or takes any comparable action under any foreign laws relating to
insolvency;
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(8) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company or any
Significant Subsidiary in an involuntary case;
(B) appoints a Custodian of the Company or any
Significant Subsidiary or for any substantial part of its
property; or
(C) orders the winding up or liquidation of the
Company or any Significant Subsidiary;
or any similar relief is granted under any foreign laws and the order
or decree remains unstayed and in effect for 60 days;
(9) any judgment or decree for the payment of money in excess
of $5.0 million or its foreign currency equivalent at the time is
entered against the Company or any Significant Subsidiary and is not
discharged, waived or stayed and either (A) an enforcement proceeding
has been commenced by any creditor upon such judgment or decree or (B)
there is a period of 60 days following the entry of such judgment or
decree during which such judgment or decree is not discharged, waived
or the execution thereof stayed;
(10) any Subsidiary Guarantee shall cease to be in full force
and effect (except as contemplated by the terms thereof) or any
Subsidiary Guarantor or Person acting by or on behalf of such
Subsidiary Guarantor shall deny or disaffirm its obligations under this
Indenture or any Subsidiary Guarantee and such Default continues for 10
days after the notice specified below; or
(11) the Company challenges the Lien on the Escrow Collateral
under the Escrow and Disbursement Agreement prior to the time that the
Escrow Collateral is to be released to the Company, the Escrow
Collateral becomes subject to any Lien other than Liens under the
Escrow Agreement or the Escrow and Disbursement Agreement becomes, or
the Company asserts that the Escrow and Disbursement Agreement is,
invalid and unenforceable, other than in accordance with its terms.
The foregoing shall constitute Events of Default whatever the
reason for any such Event of Default and whether it is voluntary or involuntary
or is effected by operation of law or pursuant to any judgment, decree or order
of any court or any order, rule or regulation of any administrative or
governmental body.
The term "Bankruptcy Law" means Xxxxx 00, Xxxxxx Xxxxxx Code,
or any similar Federal or state law for the relief of debtors. The term
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.
A Default under clause (4), (5), (6) or (10) above is not an
Event of Default until the Trustee or the Holders of at least 25% in principal
amount of the outstanding Securities notify the Company of the Default and the
Company does not cure such Default within the time specified after receipt of
such notice. Such notice must
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specify the Default, demand that it be remedied and state that such notice is a
"Notice of Default".
The Company shall deliver to the Trustee, within 30 days after
the occurrence thereof, written notice in the form of an Officers' Certificate
of any Event of Default under clause (6), (10) and (11) and any event which with
the giving of notice or the lapse of time would become an Event of Default under
clause (4), (5) or (9), its status and what action the Company is taking or
proposes to take with respect thereto.
SECTION 6.02. Acceleration. If an Event of Default (other than
an Event of Default specified in Section 6.01(7) or (8) with respect to the
Company) occurs and is continuing, the Trustee by notice to the Company, or the
Holders of at least 25% in principal amount of the outstanding Securities by
notice to the Company, may declare the principal of and accrued but unpaid
interest on all the Securities to be due and payable. Upon such a declaration,
such principal and interest shall be due and payable immediately. If an Event of
Default specified in Section 6.01(7) or (8) with respect to the Company occurs,
the principal of and interest on all the Securities shall ipso facto become and
be immediately due and payable without any declaration or other act on the part
of the Trustee or any Securityholders. The Holders of a majority in principal
amount of the Securities by notice to the Trustee may rescind an acceleration
and its consequences if the rescission would not conflict with any judgment or
decree and if all existing Events of Default have been cured or waived except
nonpayment of principal or interest that has become due solely because of
acceleration. No such rescission shall affect any subsequent Default or impair
any right consequent thereto.
SECTION 6.03. Other Remedies. If an Event of Default occurs
and is continuing, the Trustee may pursue any available remedy to collect the
payment of principal of or interest on the Securities or to enforce the
performance of any provision of the Securities, this Indenture or the Escrow and
Disbursement Agreement.
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. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 6.04. Waiver of Past Defaults. The Holders of a
majority in principal amount of the Securities by notice to the Trustee may
waive an existing Default and its consequences except (i) a Default in the
payment of the principal of or interest on a Security, (ii) a Default arising
from the failure to redeem or purchase any Security when required pursuant to
the terms of this Indenture or (iii) a Default in respect of a provision that
under Section 9.02 cannot be amended without the consent of each Securityholder
affected. When a Default is waived, it is deemed cured, but no such waiver shall
extend to any subsequent or other Default or impair any consequent right.
SECTION 6.05. Control by Majority. The Holders of a majority
in principal amount of the Securities may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee. However, the Trustee may
refuse to follow any direction that conflicts with law, this Indenture or the
Escrow and Disbursement Agreement or,
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subject to Section 7.01, that the Trustee determines is unduly prejudicial to
the rights of other Securityholders or would involve the Trustee in personal
liability; provided, however, that the Trustee may take any other action deemed
proper by the Trustee that is not inconsistent with such direction. Prior to
taking any action hereunder, 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. Except to enforce the right
to receive payment of principal, premium (if any) or interest when due, no
Securityholder may pursue any remedy with respect to this Indenture or the
Securities unless:
(1) the Holder gives to the Trustee written notice stating
that an Event of Default is continuing;
(2) the Holders of at least 25% in principal amount of the
Securities make a written request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee reasonable
security or indemnity against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60
days after receipt of the request and the offer of security or
indemnity; and
(5) the Holders of a majority in principal amount of the
Securities do not give the Trustee a direction inconsistent with the
request during such 60-day period.
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 Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any Holder
to receive payment of principal of and liquidated damages and interest on the
Securities held by such Holder, 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 such Holder.
SECTION 6.08. Collection Suit by Trustee. If an Event of
Default specified in Section 6.01(1) or (2) occurs and is continuing, the
Trustee may recover judgment in its own name and as trustee of an express trust
against the Company for the whole amount then due and owing (together with
interest on any unpaid interest to the extent lawful) and the amounts provided
for in Section 7.07.
SECTION 6.09. Trustee May File Proofs of Claim. The Trustee
may 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 and the Securityholders
allowed in any judicial proceedings relative to the Company, any Subsidiary or
Subsidiary Guarantor, their creditors or their property and, unless prohibited
by law or applicable regulations, may vote on behalf of the Holders in any
election of a trustee in bankruptcy or other Person performing similar
functions, and any Custodian in any such judicial proceeding is hereby
authorized by each Holder to make payments to the Trustee and, in the event that
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the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and its counsel, and any other amounts due the Trustee under Section 7.07.
SECTION 6.10. Priorities. If the Trustee collects any money or
property pursuant to this Article 6 or the Escrow and Disbursement Agreement, it
shall pay out the money or property in the following order:
FIRST: to the Trustee for amounts due under Section 7.07 and
to the Escrow Agent pursuant to the Escrow and Disbursement Agreement;
SECOND: to Securityholders for amounts due and unpaid on the
Securities for principal and interest, ratably, and any liquidated
damages without preference or priority of any kind, according to the
amounts due and payable on the Securities for principal, any liquidated
damages and interest, respectively; and
THIRD: to the Company provided that all sums due and owing to
the Holders, the Trustee and the Escrow Agent have been paid in full as
required by this Indenture.
The Trustee may fix a record date and payment date for any
payment to Securityholders pursuant to this Section 6.10. At least 15 days
before such record date, the Trustee shall mail to each Securityholder and the
Company a notice that states the record date, the payment date and 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 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 6.11 does not apply
to a suit by the Trustee, a suit by a Holder pursuant to Section 6.07 or a suit
by Holders of more than 10% in principal amount of the Securities.
SECTION 6.12. Waiver of Stay or Extension Laws. Neither the
Company nor any Subsidiary Guarantor which becomes a party to this Indenture (to
the extent it may lawfully do so) shall at any time insist upon, or plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law wherever enacted, now or at any time hereafter in force, which may
affect the covenants or the performance of this Indenture; and the Company (to
the extent that it may lawfully do so) hereby expressly waives, and each
Subsidiary Guarantor which becomes a party to this Indenture (to the extent that
it may lawfully do so) will agree to waive, all benefit or advantage of any such
law, and shall not 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 had been enacted.
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ARTICLE 7
Trustee
SECTION 7.01. Duties of Trustee. (a) If an Event of Default
has occurred and is continuing, the Trustee shall exercise 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
in the conduct of such Person's own affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture and the
Escrow and Disbursement Agreement and no implied covenants or
obligations shall be read into this Indenture or the Escrow and
Disbursement Agreement against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture or the Escrow and Disbursement Agreement. However, the
Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture or
the Escrow and Disbursement Agreement.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own wilful misconduct,
except that:
(1) this paragraph does not limit the effect of paragraph (b)
of this Section 7.01;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(3) 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.
(d) Every provision of this Indenture that in any way relates
to the Trustee is subject to paragraphs (a), (b) and (c) of this Section 7.01.
(e) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
(f) Money held in trust by the Trustee need not be segregated
from other funds except to the extent required by law.
(g) No provision of this Indenture or the Escrow and
Disbursement Agreement shall require the Trustee to expend or risk its own funds
or otherwise incur financial liability in the performance of any of its duties
hereunder or in the exercise of
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any of its rights or powers, if it shall have reasonable grounds to believe that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(h) 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 this Section 7.01 and to the provisions of the TIA.
SECTION 7.02. Rights of Trustee. Subject to Section 7.01: (a)
The Trustee may rely on any document believed by it to be genuine and to have
been signed or presented by the proper person. The Trustee need not investigate
any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
the Officers' Certificate or Opinion of Counsel.
(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; provided, however, that the Trustee's conduct does not
constitute wilful misconduct or negligence.
(e) The Trustee may consult with counsel, and the advice or
opinion of counsel with respect to legal matters relating to this Indenture, the
Securities and the Escrow and Disbursement Agreement shall be full and complete
authorization and protection from liability in respect to any action taken,
omitted or suffered by it here under in good faith and in accordance with the
advice or opinion of such counsel.
(f) The Trustee shall have no duty to inquire as to the
performance of the covenants in Article 4 hereof, except pursuant to Sections
4.01, 4.09, 4.10 and 4.16. In addition, the Trustee shall not be deemed to have
knowledge of any Default or Event of Default except (i) any Event of Default
occurring pursuant to Sections 6.01(1), 6.01(2), 4.01, 4.09, 4.10 or 4.16 or
(ii) any Default or Event of Default of which the Trustee shall have received
written notification or obtained actual knowledge.
(g) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond,
debenture, note or other paper or document unless requested in writing to do so
by the Holders of not less than a majority in principal amount of the Securities
at the time outstanding, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as it may see fit,
and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Company, personally or by agent or attorney.
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 or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent, Registrar, co-paying
agent or the Escrow Agent
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may do the same with like rights. However, the Trustee must comply with Sections
7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture, or the Securities or the Escrow and Disbursement Agreement, it
shall not be accountable for the Company's use of the proceeds from the
Securities, and it shall not be responsible for any statement of the Company in
this Indenture or in any document issued in connection with the sale of the
Securities, in the Securities or the Escrow and Disbursement Agreement other
than the Trustee's certificate of authentication.
SECTION 7.05. Notice of Defaults. If a Default occurs and is
continuing and if it is known to the Trustee, the Trustee shall mail to each
Securityholder notice of the Default within the earlier of 90 days after it
occurs or 30 days after it is known to a trust officer. Except in the case of a
Default in payment of principal of or interest on any Security (including
payments pursuant to the mandatory redemption provisions of such Security, if
any), or a Default in complying with any provisions of the Escrow and
Disbursement Agreement, the Trustee may withhold the notice if and so long as a
committee of its Trust Officers in good faith determines that withholding the
notice is in the interests of Securityholders.
SECTION 7.06. Reports by Trustee to Holders. As promptly as
practicable after each December 31 beginning with the December 31 following the
date of this Indenture, and in any event prior to February 15 in each year, the
Trustee shall mail to each Securityholder a brief report dated as of February 15
that complies with Section 313(a) of the TIA. The Trustee shall also comply with
Section 313(b) of the TIA.
A copy of each report at the time of its mailing to
Securityholders shall be filed with the SEC and each stock exchange (if any) on
which the Securities are listed. The Company agrees to notify promptly the
Trustee whenever the Securities become listed on any stock exchange and of any
delisting thereof.
SECTION 7.07. Compensation and Indemnity. The Company shall
pay to the Trustee from time to time reasonable compensation for its services.
The Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee upon
request for all reasonable out-of-pocket expenses incurred or made by it,
including costs of collection, in addition to the compensation for its services.
Such expenses shall include the reasonable compensation and expenses,
disbursements and advances of the Trustee's agents, counsel, accountants and
experts. The Company and each Subsidiary Guarantor that becomes a party to this
Indenture pursuant to Section 4.11, jointly and severally shall indemnify the
Trustee against any and all loss, liability or expense (including reasonable
attorneys' fees) incurred by or in connection with the administration of this
trust and the performance of its their duties hereunder. The Trustee shall
notify the Company of any claim for which it may seek indemnity promptly upon
obtaining actual knowledge thereof; provided, however, that any failure so to
notify the Company shall not relieve the Company or any Subsidiary Guarantor of
its indemnity obligations hereunder. The Company shall defend the claim and the
indemnified party shall provide reasonable cooperation at the Company's expense
in the defense. Such indemnified parties may have separate counsel and the
Company and the Subsidiary Guarantors, as applicable, shall pay the fees and
expenses of such counsel; provided, however, that the Company shall not be
required to
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pay such fees and expenses if it assumes such indemnified parties' defense and,
in such indemnified parties' reasonable judgment, there is no conflict of
interest between the Company and the Subsidiary Guarantors, as applicable, and
such parties in connection with such defense. The Company need not reimburse any
expense or indemnify against any loss, liability or expense incurred by an
indemnified party through such party's own wilful misconduct, negligence or bad
faith.
To secure the Company's payment obligations pursuant to this
Section 7.07, the Trustee shall have a lien prior to the Securities on all money
or property held or collected by the Trustee other than money or property held
in trust to pay principal of and interest and any liquidated damages on
particular Securities.
The Company's payment obligations pursuant to this Section
shall survive the satisfaction or discharge of this Indenture, any rejection or
termination of this Indenture under any bankruptcy law or the resignation or
removal of the Trustee. When the Trustee incurs expenses after the occurrence of
a Default specified in Section 6.01(7) or (8) with respect to the Company, the
expenses are intended to constitute expenses of administration under the
Bankruptcy Law.
SECTION 7.08. Replacement of Trustee. The Trustee may resign
at any time by so notifying the Company. The Holders of a majority in principal
amount of the Securities may remove the Trustee by so notifying the Trustee and
may appoint a successor Trustee. The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the
Trustee or its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns, is removed by the Company or by the
Holders of a majority in principal amount of the Securities and such Holders do
not reasonably promptly appoint a successor Trustee, or if a vacancy exists in
the office of Trustee for any reason (the Trustee in such event being referred
to herein as the retiring Trustee), the Company shall promptly appoint a
successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Securityholders. The retiring Trustee shall promptly transfer all
property held by it as Trustee to the successor Trustee, subject to the lien
provided for in Section 7.07.
If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee or the
Holders of 10% in principal amount of the Securities may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
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If the Trustee fails to comply with Section 7.10, any
Securityholder may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to
this Section 7.07, the Company's obligations under Section 7.07 shall continue
for the benefit of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee.
In case at the time such successor or successors by merger,
conversion or consolidation to the Trustee shall succeed to the trusts created
by this Indenture any of the Securities shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Securities so
authenticated; and in case at that time any of the Securities shall not have
been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor hereunder or in the name of the
successor to the Trustee; and in all such cases such certificates shall have the
full force which it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee shall have.
SECTION 7.10. Eligibility; Disqualification. The Trustee shall
at all times satisfy the requirements of TIA Section 310(a). The Trustee or the
bank holding company of which the Trustee is a wholly-owned subsidiary shall
have a combined capital and surplus of at least $100,000,000 as set forth in its
most recent published annual report of condition. The Trustee shall comply with
TIA Section 310(b); provided, however, that there shall be excluded from the
operation of TIA Section 310(b)(1) any indenture or indentures under which other
securities or certificates of interest or participation in other securities of
the Company are outstanding if the requirements for such exclusion set forth in
TIA Section 310(b)(1) are met.
SECTION 7.11. Preferential Collection of Claims Against
Company. The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated.
ARTICLE 8
Discharge of Indenture; Defeasance
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 2.08) for
cancelation or (ii) all outstanding Securities have become due and payable,
whether at maturity or as a result of the mailing of a notice of redemption
pursuant to Article 3 hereof, and the Company irrevocably deposits with the
Trustee funds or U.S. Government Obligations on which payment of principal and
interest when due will be sufficient to pay at maturity or upon redemption
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all outstanding Securities, including interest thereon to maturity or such
redemption date (other than Securities replaced pursuant to Section 2.08), and
if in either case the Company pays all other sums payable hereunder by the
Company, then this Indenture shall, subject to Section 8.01(c), 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 and at the cost and expense of the Company.
(b) Subject to Sections 8.01(c) and 8.02, the Company at any
time may terminate (i) all of its obligations under the Securities and this
Indenture ("legal defeasance option") or (ii) its obligations under Sections
4.02, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14 and
4.15 and the operation of Section 5.01(a)(iii), 6.01(4), 6.01(6), 6.01(7) (with
respect to Significant Subsidiaries of the Company only), 6.01(8) (with respect
to Significant Subsidiaries of the Company only) and 6.01(9) ("covenant
defeasance option"). The Company may exercise its legal defeasance option
notwithstanding its prior exercise of its covenant defeasance option. In the
event that the Company terminates all of its obligations under the Securities
and this Indenture by exercising its legal defeasance option, the obligations
under the Subsidiary Guarantees, if any, shall each be terminated simultaneously
with the termination of such obligations.
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 Sections 6.01(4),
6.01(6), 6.01(7) (with respect to Significant Subsidiaries of the Company only),
6.01(8) (with respect to Significant Subsidiaries of the Company only) or
6.01(9) or because of the failure of the Company to comply with Section
5.01(a)(iii).
Upon satisfaction of the conditions set forth herein and upon
request of the Company, the Trustee shall acknowledge in writing the discharge
of those obligations that the Company terminates.
(c) Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.04, 2.05, 2.06, 2.07, 2.08, 2.09, 7.07, 7.08 and in
this Article 8 shall survive until the Securities have been paid in full.
Thereafter, the Company's obligations in Sections 7.07, 8.04 and 8.05 shall
survive.
SECTION 8.02. Conditions to Defeasance. The Company may
exercise its legal defeasance option or its covenant defeasance option only if:
(1) the Company irrevocably deposits in trust with the Trustee
money or U.S. Government Obligations for the payment of principal,
premium (if any) and interest on the Securities to maturity or
redemption, as the case may be;
(2) the Company delivers to the Trustee a certificate from a
nationally recognized firm of independent accountants expressing their
opinion that the payments of principal and interest when due and
without reinvestment on the deposited U.S. Government Obligations plus
any deposited money without investment will provide cash at such times
and in such amounts as will be
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sufficient to pay principal and interest when due on all the Securities
to maturity or redemption, as the case may be;
(3) 123 days pass after the deposit is made and during the
123-day period no Default specified in Section 6.01(7) or (8) with
respect to the Company occurs which is continuing at the end of the
period;
(4) the deposit does not constitute a default under any other
agreement binding on the Company;
(5) the Company delivers to the Trustee an Opinion of Counsel
to the effect that the trust resulting from the deposit does not
constitute, or is qualified as, a regulated investment company under
the Investment Company Act of 1940;
(6) in the case of the legal defeasance option, the Company
shall have delivered to the Trustee an Opinion of Counsel stating that
(i) the Company has received from, or there has been published by, the
Internal Revenue Service a ruling, or (ii) 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 Federal income tax purposes as a result of
such 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 defeasance had not occurred;
(7) 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 Security holders 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
(8) 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.
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.
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 of and interest on the Securities.
SECTION 8.04. Repayment to Company. The Trustee and the Paying
Agent shall promptly turn over to the Company upon request any excess money or
securities held by them at any time.
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Subject to any applicable abandoned property law, the Trustee
and the Paying Agent shall pay to the Company upon written request any money
held by them for the payment of principal or interest that remains unclaimed for
two years, and, thereafter, Securityholders entitled to the money must look to
the Company for payment as general creditors.
SECTION 8.05. Indemnity for Government Obligations. The
Company 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 obligations under this
Indenture and the Securities 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 has made any payment of interest on or principal of any Securities
because of the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Securities 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 Holders. The Company, the
Subsidiary Guarantors, if any, and the Trustee may amend this Indenture or the
Securities without notice to or consent of any Securityholder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article 5;
(3) to provide for uncertificated Securities in addition to or
in place of certificated Securities; provided, however, 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;
(4) to add additional Guarantees with respect to the
Securities or to secure the Securities or to create and maintain a
valid first priority security interest in and on the Escrow Collateral
in favor of the Trustee for the benefit of Holders;
(5) to add to the covenants of the Company for the benefit of
the Holders or to surrender any right or power herein conferred upon
the Company;
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(6) to comply with any requirements of the SEC in connection
with qualifying, or maintaining the qualification of, this Indenture
under the TIA;
(7) to make any change that does not adversely affect the
rights of any Securityholder; or
(8) to provide for the issuance of the Exchange Securities,
Private Exchange Securities or Additional Securities, which shall have
terms substantially identical in all material respects to the Original
Securities (except that the transfer restrictions contained in the
Original Securities shall be modified or eliminated, as appropriate),
and which shall be treated, together with any outstanding Original
Securities, as a single issue of securities.
After an amendment under this Section becomes effective, the
Company shall mail to Securityholders a notice briefly describing such
amendment. The failure to give such notice to all Securityholders, or any defect
therein, shall not impair or affect the validity of an amendment under this
Section.
SECTION 9.02. With Consent of Holders. The Company, the
Subsidiary Guarantors, if any, and the Trustee may amend this Indenture or the
Securities without notice to any Securityholder but with the written consent of
the Holders of at least a majority in principal amount of the Securities then
outstanding (including consents obtained in connection with a tender offer or
exchange offer for the Securities). However, without the consent of each
Securityholder affected, an amendment may not:
(1) reduce the amount of Securities whose Holders must consent
to an amendment;
(2) reduce the rate of or extend the time for payment of
interest or any liquidated damages on any Security;
(3) reduce the principal of or extend the Stated Maturity of
any Security;
(4) reduce the premium payable upon the redemption of any
Security or change the time at which any Security may be redeemed in
accordance with Article 3 or paragraph 5 of the Securities;
(5) make any Security payable in money other than that stated
in the Security;
(6) make any change in Section 6.04 or 6.07 or the second
sentence of this Section 9.02;
(7) modify or affect in any manner adverse to the Holders the
terms and conditions of the obligation of any Subsidiary Guarantor for
the due and punctual payment of the principal of or any liquidated
damages or interest on the Securities;
(8) impair the right of any Holder to receive payment of
principal of and interest or any liquidated damages on such Holder's
Securities on or after the due
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dates therefor or to institute suit for the enforcement of any payment
on or with respect to such Holder's Securities; or
(9) modify the provisions of the Escrow and Disbursement
Agreement or this Indenture relating to the Escrow Collateral in any
manner adverse to the Holders or release any of the Escrow Collateral
from the Lien under the Escrow and Disbursement Agreement or permit any
other obligation to be secured by the Escrow Collateral.
It shall not be necessary for the consent of the Holders under
this Section 9.02 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent approves the substance thereof.
After an amendment under this Section 9.02 becomes effective,
the Company shall mail to Securityholders a notice briefly describing such
amendment. The failure to give such notice to all Securityholders, or any defect
therein, shall not impair or affect the validity of an amendment under this
Section 9.02.
SECTION 9.03. Compliance with Trust Indenture Act. Every
amendment to this Indenture or the Securities shall comply with the TIA as then
in effect.
SECTION 9.04. Revocation and Effect of Consents and Waivers. A
consent to an amendment or a waiver by a Holder of a Security shall bind the
Holder and every subsequent Holder of that Security or portion of the Security
that evidences the same debt as the consenting Holder's Security, even if
notation of the consent or waiver is not made on the Security. However, any such
Holder or subsequent Holder may revoke the consent or waiver as to such Holder's
Security or portion of the Security if the Trustee receives the notice of
revocation before the date the amendment or waiver becomes effective. After an
amendment or waiver becomes effective, it shall bind every Securityholder. An
amendment or waiver becomes effective once both (i) the requisite number of
consents have been received by the Company or the Trustee and (ii) such
amendment or waiver has been executed by the Company and the Trustee.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Securityholders entitled to give their
consent or take any other action described above or required or permitted to be
taken pursuant to this Indenture. If a record date is fixed, then
notwithstanding the immediately preceding paragraph, those Persons who were
Securityholders at such record date (or their duly designated proxies), and only
those Persons, shall be entitled to give such consent or to revoke any consent
previously given or to take any such action, whether or not such Persons
continue to be Holders after such record date. No such consent shall be valid or
effective for more than 120 days after such record date.
SECTION 9.05. Notation on or Exchange of Securities. If an
amendment changes the terms of a Security, the Trustee may require the Holder of
the Security to deliver it to the Trustee. The Trustee may place an appropriate
notation on the Security regarding the changed terms and return it to the
Holder. Alternatively, if the Company or the Trustee so determines, the Company
in exchange for the Security shall issue and the Trustee shall authenticate a
new Security that reflects the changed terms. Failure to make the appropriate
notation or to issue a new Security shall not affect the validity of such
amendment.
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SECTION 9.06. Trustee to Sign Amendments. The Trustee shall
sign any amendment authorized pursuant to this Article 9 if the amendment 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 such
amendment the Trustee shall be entitled to receive indemnity reasonably
satisfactory to it and to receive, and (subject to Section 7.01) shall be fully
protected in relying upon, an Officers' Certificate and an Opinion of Counsel
stating that such amendment is authorized or permitted by this Indenture and
that such amendment is the legal, valid and binding obligation of the Company
and the Subsidiary Guarantors, if any, enforceable against them in accordance
with its terms, subject to customary exceptions, and complies with the
provisions hereof (including Section 9.03).
SECTION 9.07. Payment for Consent. Neither the Company nor any
Affiliate of the Company shall, directly or indirectly, pay or cause to be paid
any consideration, whether by way of interest, fee or otherwise, to any Holder
for or as an inducement to any consent, waiver or amendment of any of the terms
or provisions of this Indenture or the Securities unless such consideration is
offered to be paid to all Holders that so consent, waive or agree to amend in
the time frame set forth in solicitation documents relating to such consent,
waiver or agreement.
ARTICLE 10
Escrow Collateral and Security
SECTION 10.01. Escrow and Disbursement Agreement. The due and
punctual payment of the first four semi-annual interest payments on the
Securities, when and as the same shall be due and payable on an Interest Payment
Date or by acceleration, shall be secured as provided in the Escrow and
Disbursement Agreement which the Company, the Escrow Agent and the Trustee have
entered into simultaneously with the execution of this Indenture. Upon
acceleration of the Securities prior to the payment in full of the first four
semi-annual interest payments on the Securities, the Escrow Agent shall, upon
the receipt of written notice from the Trustee, as agent for the Trustee,
foreclose upon the Escrow Collateral. Each Holder of Securities, by its
acceptance thereof, consents and agrees to the terms of the Escrow and
Disbursement Agreement (including, without limitation, the provisions providing
for foreclosure and disbursement of the Escrow Collateral) as the same may be in
effect or may be amended from time to time in accordance with its terms and the
terms hereof and authorizes and directs the Escrow Agent and the Trustee to
enter into the Escrow and Disbursement Agreement and to perform its obligations
and exercise its rights thereunder in accordance therewith. The Company shall
deliver to the Trustee copies of the Escrow and Disbursement Agreement, and
shall do or cause to be done all such acts and things as may be necessary or
proper, or as may be required by the provisions of the Escrow and Disbursement
Agreement, to assure and confirm to the Trustee the security interest in the
Escrow Collateral contemplated by the Escrow and Disbursement Agreement or any
part thereof, as from time to time constituted, so as to render the Escrow
Collateral available for the security and benefit of this Indenture with respect
to the Securities, according to the intent and purposes expressed in the Escrow
and Disbursement Agreement. The Company shall take any and all actions
reasonably required to cause the Escrow and Disbursement Agreement to create and
maintain (to the extent possible under applicable law), as security for the
obligations of the Company hereunder, a security interest in and on all
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the Escrow Collateral, in favor of the Trustee, for the benefit of Holders.
Neither the Escrow Agent nor the Trustee shall have any responsibility for
perfecting or maintaining the perfection of the Trustee's security interest in
the Escrow Collateral or for filing any instrument, document or notice in any
public office at any time or times.
SECTION 10.02. Recording and Opinions. (a) The Company shall
furnish to the Trustee simultaneously with the execution and delivery of this
Indenture an Opinion of Counsel stating that (i) either (A) in the opinion of
such counsel all action has been taken with respect to the recording,
registering and filing of this Indenture, financing statements or other
instruments necessary to create a valid and perfected first priority security
interest in favor of the Trustee for the benefit of Holders, subject to no equal
or prior security interest of any creditor or (B) in the opinion of such counsel
no such action is necessary to make such security interest effective and (ii) a
valid and perfected security interest has been created in the Escrow Collateral
in favor of the Trustee for the benefit of Holders.
(b) To the extent, if any, Section 314(b) of the Trust
Indenture Act is applicable, the Company shall furnish to the Trustee on each
anniversary of the Closing Date (upon receipt of written notice from the Escrow
Agent) until the date upon which the balance of funds in the Escrow Account
shall have been reduced to zero, an Opinion of Counsel, dated as of such date,
complying in all respects with Section 314(b) of the TIA.
SECTION 10.03. Release of Escrow Collateral. (a) Subject to
subsections (b), (c) and (d) of this Section 10.03, the Escrow Collateral may be
released from the security interest created by the Escrow and Disbursement
Agreement only in accordance with the provisions of the Escrow and Disbursement
Agreement.
(b) No Escrow Collateral shall be released from the security
interest created by the Escrow and Disbursement Agreement pursuant to the
provisions of the Escrow and Disbursement Agreement, other than as provided in
the Escrow and Disbursement Agreement.
(c) Upon acceleration of the Securities (whether by
declaration or otherwise), no Escrow Collateral shall be released pursuant to
the provisions of the Escrow and Disbursement Agreement, and no release of
Escrow Collateral in contravention of this Section 10.03(c) shall be effective
as against Holders, except for the disbursement of all funds and other Escrow
Collateral to the Trustee pursuant to Section 6(b) of the Escrow and
Disbursement Agreement.
(d) To the extent applicable, the Company shall cause Section
314(d) of the TIA, relating to the release of property or securities from the
security interest of the Escrow and Disbursement Agreement, to be complied with.
SECTION 10.04. Authorization of Actions to Be Taken by the
Trustee Under the Escrow and Disbursement Agreement. Subject to the provisions
of Section 7.01 and Section 7.02, the Trustee may, without the consent of
Holders, on behalf of such Holders, take all actions it deems necessary or
appropriate in order to (a) enforce any of the terms of the Escrow and
Disbursement Agreement and (b) collect and receive any and all amounts payable
in respect of the obligations of the Company thereunder and hereunder. The
Trustee shall have power to institute and maintain such suits and
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proceedings as it may deem expedient to prevent any impairment of the Escrow
Collateral by any acts that may be unlawful or in violation of the Escrow and
Disbursement Agreement or this Indenture, and such suits and proceedings as the
Trustee may deem expedient to preserve or protect its interests and the
interests of Holders and the Escrow Agent in the Escrow Collateral (including
power to institute and maintain suits or proceedings to restrain the enforcement
of or compliance with any legislative or other governmental enactment, rule or
order that may be unconstitutional or otherwise invalid if the enforcement of,
or compliance with, such enactment, rule or order would impair the security
interest hereunder or be prejudicial to the interests of the Holders or of the
Trustee).
SECTION 10.05. Authorization of Receipt of Funds by the
Trustee Under the Escrow and Disbursement Agreement. The Trustee is authorized
to receive any funds for the benefit of Holders disbursed under the Escrow and
Disbursement Agreement, and to make further distributions of such funds to
Holders according to the provisions of this Indenture.
SECTION 10.06. Termination of Security Interest. Upon the
earliest to occur of (i) the date upon which the balance of funds in the Escrow
Account and other Escrow Collateral shall have been reduced to zero, (ii) the
payment of the first four semi-annual interest payments on the Notes and (iii)
defeasance of the Company's obligations under the Securities and this Indenture
in accordance with Article 8, the Trustee shall, at the written request of the
Company, release the security interest in the Escrow Collateral pursuant to this
Indenture and the Escrow and Disbursement Agreement upon the Company's
compliance with the provisions of the TIA pertaining to release of collateral.
ARTICLE 11
Miscellaneous
SECTION 11.01. 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.
SECTION 11.02. Notices. Any notice or communication shall be
in writing and delivered in person or mailed by first-class mail addressed as
follows:
if to the Company:
Splitrock Services, Inc.
0000 Xxx Xxxxxx Xxxxx, Xxxxx 000
Xxx Xxxxxxxxx, XX 00000
Attention of: Vice President and General
Counsel
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if to the Trustee:
Bank of Montreal Trust Company
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention of: Corporate Trust Department
The Company or the Trustee by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed to a Securityholder shall
be mailed to the Securityholder at the Securityholder's address as it appears on
the registration books of the Registrar and shall be sufficiently given if so
mailed within the time prescribed.
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. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 11.03. Communication by Holders with Other Holders.
Securityholders may communicate pursuant to TIA Section 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA Section 312(c).
SECTION 11.04. Certificate and Opinion as to Conditions
Precedent. Upon any request or application by the Company to the Trustee to take
or refrain from taking any action under this Indenture, the Company shall
furnish to the Trustee:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
SECTION 11.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a covenant or
condition provided for in this Indenture shall include:
(1) a statement that the individual making such certificate or
opinion has read such covenant or condition;
(2) 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;
(3) a statement that, in the opinion of such individual, he
has made such examination or investigation as is necessary to enable
him to express an informed
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opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether or not, in the opinion of such
individual, such covenant or condition has been complied with.
SECTION 11.06. When Securities Disregarded. 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,
any Subsidiary Guarantor or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company or any
Subsidiary Guarantor shall be disregarded and deemed not to be outstanding,
except that, for the purpose of determining whether the Trustee shall be
protected in relying on any such direction, waiver or consent, only Securities
which the Trustee knows are so owned shall be so disregarded. Subject to the
foregoing, only Securities outstanding at the time shall be considered in any
such determination.
SECTION 11.07. Rules by Trustee, Paying Agent and Registrar.
The Trustee may make reasonable rules for action by or a meeting of
Securityholders. The Registrar and the Paying Agent may make reasonable rules
for their functions.
SECTION 11.08. Legal Holidays. A "Legal Holiday" is a
Saturday, a Sunday or a day on which banking institutions are not required to be
open in the State of New York. If a payment date is a Legal Holiday, payment
shall be made on the next succeeding day that is not a Legal Holiday, and no
interest shall accrue for the intervening period. If a regular record date is a
Legal Holiday, the record date shall not be affected.
SECTION 11.09. 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 11.10. No Recourse Against Others. A director,
officer, employee or stockholder, as such, of the Company shall not 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. By accepting a Security, each Securityholder
shall waive and release all such liability. The waiver and release shall be part
of the consideration for the issue of the Securities.
SECTION 11.11. Successors. All agreements of the Company and
each Subsidiary Guarantor, if any, in this Indenture and the Securities shall
bind its successors. All agreements of the Trustee in this Indenture shall bind
its successors.
SECTION 11.12. Multiple Originals. The parties may sign any
number of copies of this Indenture. Each signed copy shall be an original, but
all of them together represent the same agreement. One signed copy is enough to
prove this Indenture.
SECTION 11.13. Table of Contents; Headings. The table of
contents, cross-reference sheet and headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not
intended to be considered a part hereof and shall not modify or restrict any of
the terms or provisions hereof.
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IN WITNESS WHEREOF, the parties have caused this Indenture to
be duly executed as of the date first written above.
SPLITROCK SERVICES, INC.,
by /s/
----------------------------------------
Name:
Title:
BANK OF MONTREAL TRUST
COMPANY, as Trustee,
by /s/
----------------------------------------
Name:
Title: