EXHIBIT 4.03
================================================================================
=============================
ENTERCOM RADIO, LLC
ENTERCOM CAPITAL, INC.,
as Co-Issuers
and
the GUARANTORS named herein
=============================
FIRST SUPPLEMENTAL INDENTURE
Dated as of March 5, 2002
=============================
HSBC BANK USA,
Trustee
=============================
================================================================================
TABLE OF CONTENTS
Page
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE ............................. 1
Section 1.01. Definitions ........................................................ 1
Section 1.02. Other Definitions .................................................. 17
ARTICLE 2. THE NOTES .............................................................. 17
Section 2.01. General ............................................................ 17
Section 2.02. Transfer and Exchange .............................................. 18
Section 2.03. Treasury Notes ..................................................... 21
ARTICLE 3. REDEMPTION AND PREPAYMENT .............................................. 21
Section 3.01. Optional Redemption ................................................ 21
Section 3.02. Mandatory Redemption ............................................... 22
Section 3.03. Offer to Purchase by Application of Excess Proceeds ................ 22
ARTICLE 4. COVENANTS .............................................................. 23
Section 4.01. Additional Interest on Defaulted Interest .......................... 23
Section 4.02. Reports ............................................................ 24
Section 4.03. Restricted Payments ................................................ 24
Section 4.04. Dividend and Other Payment Restrictions Affecting Subsidiaries ..... 26
Section 4.05. Incurrence of Indebtedness and Issuance of Preferred Stock ......... 27
Section 4.06. Asset Sales ........................................................ 30
Section 4.07. Transactions with Affiliates ....................................... 32
Section 4.08. Liens .............................................................. 33
Section 4.09. Offer to Repurchase Upon Change of Control ......................... 33
Section 4.10. No Senior Subordinated Debt ........................................ 34
Section 4.11. Additional Subsidiary Guarantees ................................... 34
Section 4.12. Limitation on Issuances of Equity Interests in Wholly Owned
Subsidiaries ....................................................... 35
Section 4.13. Payments for Consent ............................................... 35
Section 4.14. Designation of Restricted and Unrestricted Subsidiaries ............ 35
ARTICLE 5. SUCCESSORS ............................................................. 35
Section 5.01. Merger, Consolidation, or Sale of Assets ........................... 35
ARTICLE 6. DEFAULTS AND REMEDIES .................................................. 36
Section 6.01. Events of Default .................................................. 36
Section 6.02. Acceleration ....................................................... 38
TABLE OF CONTENTS
(continued)
Page
ARTICLE 7. AMENDMENT, SUPPLEMENT AND WAIVER ....................................... 39
Section 7.01. Without Consent of Holders of Notes ................................ 39
Section 7.02. With Consent of Holders of Notes ................................... 40
Section 7.03. Compliance with Trust Indenture Act ................................ 41
ARTICLE 8. SUBORDINATION .......................................................... 41
Section 8.01. Agreement to Subordinate ........................................... 41
Section 8.02. Liquidation; Dissolution; Bankruptcy ............................... 41
Section 8.03. Default on Designated Senior Indebtedness .......................... 42
Section 8.04. Acceleration of Notes .............................................. 43
Section 8.05. When Distribution Must Be Paid Over ................................ 43
Section 8.06. Notice by Company .................................................. 44
Section 8.07. Subrogation ........................................................ 44
Section 8.08. Relative Rights .................................................... 44
Section 8.09. Subordination May Not Be Impaired by Company or any Guarantor ...... 44
Section 8.10. Distribution or Notice to Representative ........................... 45
Section 8.11. Rights of Trustee and Paying Agent ................................. 45
Section 8.12. Authorization to Effect Subordination .............................. 45
Section 8.13. Amendments ......................................................... 45
Section 8.14. Reinstatement of Payments .......................................... 46
ARTICLE 9. GUARANTEES ............................................................. 46
Section 9.01. Guarantee .......................................................... 46
Section 9.02. Subordination of Guarantee ......................................... 47
Section 9.03. Limitation on Guarantor Liability .................................. 47
Section 9.04. Execution and Delivery of Guarantee ................................ 47
Section 9.05. Subsidiary Guarantors May Consolidate, etc., on Certain Terms ...... 48
Section 9.06. Releases Following Sale of Assets .................................. 48
ARTICLE 10. DEFEASANCE ............................................................. 49
Section 10.01. Covenant Defeasance ................................................ 49
Section 10.02. Miscellaneous ...................................................... 49
ARTICLE 11. MISCELLANEOUS .......................................................... 50
Section 11.01. Ratification of Base Indenture ..................................... 50
Section 11.02. Application of First Supplemental Indenture. ....................... 50
ii
TABLE OF CONTENTS
(continued)
Page
Section 11.03. Benefits of First Supplemental Indenture ........................... 50
Section 11.04. Effective Date ..................................................... 50
Section 11.05. Trustee ............................................................ 50
Section 11.06. Governing Law ...................................................... 50
Section 11.07. Successors ......................................................... 50
Section 11.08. Severability ....................................................... 50
Section 11.09. Counterpart Originals .............................................. 51
EXHIBITS
Exhibit A FORM OF NOTE
Exhibit B FORM OF SUPPLEMENTAL INDENTURE
Exhibit C FORM OF NOTATION OF GUARANTEE
iii
FIRST SUPPLEMENTAL INDENTURE dated as of March 5, 2002 to that certain
Indenture, dated as of March 5, 2002 (the "Base Indenture," and together with
the First Supplemental Indenture, the "Indenture"), among Entercom Radio LLC, a
Delaware limited liability company ("Radio"), Entercom Capital, Inc., a Delaware
corporation ("Capital," each of Radio and Capital being referred to herein
individually as an "Issuer" and collectively as the "Company"), Entercom
Communications Corp., a Pennsylvania corporation (the "Parent Guarantor"), the
Subsidiary Guarantors listed on Schedule I thereto (the "Subsidiary Guarantors,"
and together with the Parent Guarantor, the "Guarantors") and HSBC Bank USA, as
Trustee (the "Trustee").
The Issuers and the Trustee have heretofore executed the Base
Indenture, a form of which has been filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, as Exhibit 4.4 to the
Company's Registration Statement on Form S-3 (Registration No. 333-82542),
providing for the issuance from time to time of debt securities of the Issuers.
The Issuers and the Trustee are hereby supplementing the Base Indenture
pursuant to the provisions of Section 9.01(7) of the Base Indenture to establish
the form and terms of the debt securities issued pursuant to this First
Supplemental Indenture. The terms of this First Supplemental Indenture shall
supplement and be incorporated in their entirety with the terms of the Base
Indenture. To the extent any terms of this First Supplemental Indenture are
contrary to or duplicative of terms contained in the Base Indenture, the terms
of this First Supplemental Indenture shall be deemed to supersede the Base
Indenture.
The Company, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders of
the 7-5/8% Senior Subordinated Notes due 2014 (the "Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01. Definitions.
So long as any of the Notes are outstanding, the following definitions
shall be applicable to the Notes, shall be included as defined terms for all
purposes under the Base Indenture with respect to the Notes and, to the extent
inconsistent with the definitions contained in Section 1.01 of the Base
Indenture, shall replace such definitions with respect to the Notes. Capitalized
terms used but not defined herein shall have the meaning ascribed to such terms
in the Base Indenture.
"Acquired Debt" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, whether or
not such Indebtedness is incurred in connection with, or in contemplation of,
such other Person merging with or into, or becoming a Subsidiary of, such
specified Person and (ii) Indebtedness secured by a Lien encumbering any asset
acquired by such specified Person.
"Acquisition Debt" means Indebtedness the proceeds of which are
utilized solely to (x) acquire all or substantially all of the assets or a
majority of the Voting Stock of an existing radio broadcasting business or
station or (y) finance an LMA (in each case, including to repay or refinance
indebtedness or other obligations incurred in connection with such acquisition
or LMA, as the case may be, and to pay related fees and expenses).
1
"Applicable Procedures" means, with respect to any transfer or exchange
of or for beneficial interests in any Global Note, the rules and procedures of
the Depositary that apply to such transfer or exchange.
"Asset Sale" means:
(1) the sale, lease, conveyance or other disposition of
any assets or rights, other than in the ordinary course of business
(provided, that the sale, lease, conveyance or other disposition of
radio stations or all or substantially all their assets shall be deemed
not to be in the ordinary course of business); provided that the sale,
conveyance or other disposition of all or substantially all of the
assets of the Company and its Restricted Subsidiaries taken as a whole
will be governed by the provisions of this First Supplemental Indenture
described in Sections 4.09 and/or 5.01 hereof and not by the provisions
of Section 4.06 hereof; and
(2) the issuance of Equity Interests in a Restricted
Subsidiary to any Person other than the Parent Guarantor or a
Restricted Subsidiary or the sale by the Company or a Restricted
Subsidiary of Equity Interests in a Restricted Subsidiary.
Notwithstanding the foregoing, the following items will not be deemed
to be Asset Sales:
(1) any single transaction or series of related
transactions that involves assets having a fair market value of $5.0
million or less;
(2) a transfer of assets between or among the Company and
its Restricted Subsidiaries;
(3) an issuance of Equity Interests by a Restricted
Subsidiary to the Company or to another Restricted Subsidiary;
(4) the sale or lease of equipment, inventory, accounts
receivable or other assets in the ordinary course of business;
(5) the sale and leaseback of any assets within 90 days
of the acquisition thereof;
(6) foreclosure on assets;
(7) the disposition of equipment that the Company shall
determine in good faith to be obsolete or no longer used or useful in
the business of such entity;
(8) the sale or other disposition of cash or Cash
Equivalents; and
(9) a Restricted Payment or Permitted Investment that is
permitted by Section 4.03 hereof.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3
and Rule 13d-5 under the Exchange Act. The terms "Beneficially Owns" and
"Beneficially Owned" have a corresponding meaning.
2
"Board of Directors" means:
(1) with respect to a corporation, the board of directors
of the corporation;
(2) with respect to a partnership, the board of directors
of the general partner of the partnership; and
(3) with respect to any other Person, the board or
committee of such Person having a similar function.
Unless the context otherwise requires, references to "Board of
Directors" is the board of directors (or equivalent body) or a
committee of such board of directors of the Parent Guarantor.
"Capital Lease Obligation" means, at the time any determination is to
be made, the amount of the liability in respect of a capital lease that would at
that time be required to be capitalized on a balance sheet in accordance with
GAAP.
"Capital Stock" means:
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any
and all shares, interests, participations, rights or other equivalents
(however designated) of corporate stock;
(3) in the case of a partnership or limited liability
company, partnership or membership interests (whether general or
limited); and
(4) any other interest or participation that confers on a
Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"Cash Equivalents" means (i) United States dollars; (ii) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality of the United States government
having maturities of not more than one year from the date of acquisition; (iii)
certificates of deposit and eurodollar time deposits with maturities of one year
or less from the date of acquisition, bankers' acceptances with maturities not
exceeding one year and overnight bank deposits, in each case, with any lender
party to Credit Facilities or any domestic commercial bank having capital and
surplus in excess of $500.0 million and a Thomson Bank Watch Rating of "B" or
better; (iv) repurchase obligations with a term of not more than 30 days for
underlying securities of the types described in clauses (ii) and (iii) above
entered into with any financial institution meeting the qualifications specified
in clause (iii) above; (v) commercial paper having one of the two highest
ratings obtainable from Moody's Investors Service, Inc. or Standard & Poor's
Rating Services and in each case maturing within one year after the date of
acquisition; and (vi) money market funds at least 95% of the assets of which
constitute Cash Equivalents of the kinds described in clauses (i) through (v) of
this definition.
"Change of Control" means the occurrence of any of the following:
(1) the direct or indirect sale, transfer, conveyance or
other disposition (other than by way of merger or consolidation), in
one or a series of related transactions, of all or substantially all of
the properties or assets of the Company and its Restricted
Subsidiaries, taken as a whole to any "person" (as that term is used in
Section 13(d)(3) of the Exchange Act) other than a Principal or a
Related Party of a Principal;
3
(2) the adoption of a plan relating to the liquidation or
dissolution of the Company;
(3) the consummation of any transaction (including,
without limitation, any merger or consolidation) the result of which is
that any "person" (as defined above), other than the Principals and
their Related Parties, becomes the Beneficial Owner, directly or
indirectly, of more than 50% of the Voting Stock of the Company,
measured by voting power rather than number of shares; or
(4) the first day on which a majority of the members of
the Board of Directors are not Continuing Directors.
"Company" means Entercom Radio LLC and Entercom Capital, Inc., and any
and all successors thereto.
"Consolidated Cash Flow" means, with respect to any specified Person
for any period, the Consolidated Net Income of such Person for such period plus:
(1) an amount equal to any extraordinary loss plus any
net loss, together with any related provision for taxes, realized by
such Person or any of its Restricted Subsidiaries in connection with
(a) an Asset Sale (including any sale and leaseback transaction), or
(b) the disposition of any securities by such Person or any of its
Restricted Subsidiaries or the extinguishment of any Indebtedness of
such Person or any of its Restricted Subsidiaries, to the extent such
losses were deducted in computing such Consolidated Net Income; plus
(2) provision for taxes based on income or profits of
such Person and its Restricted Subsidiaries for such period, to the
extent that such provision for taxes was deducted in computing such
Consolidated Net Income; plus
(3) consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued and
whether or not capitalized (including, without limitation, amortization
of debt issuance costs and original issue discount, non-cash interest
payments, the interest component of any deferred payment obligations,
the interest component of all payments associated with Capital Lease
Obligations, imputed interest with respect to obligations with respect
to any sale and leaseback transaction, all fees, including but not
limited to agency fees, letter of credit fees, commitment fees,
commissions, discounts and other fees and charges incurred in respect
of Indebtedness and net of the effect of all payments made or received
pursuant to Hedging Obligations), to the extent that any such expense
was deducted in computing such Consolidated Net Income; plus
(4) depreciation, amortization (including non-cash
employee and officer equity compensation expenses, amortization of
goodwill and other intangibles, amortization of programming costs and
barter expenses, but excluding amortization of prepaid cash expenses
that were paid in a prior period) and other non-cash expenses
(excluding any such non-cash expense to the extent that it represents
amortization of a prepaid cash expense that was paid in a prior period)
of such Person and its Restricted Subsidiaries for such period to the
extent that such depreciation, amortization and other non-cash expenses
were deducted in computing such Consolidated Net Income; plus
(5) any extraordinary or non-recurring expenses of such
Person and the Restricted Subsidiaries for such period to the extent
that such charges were deducted in computing such Consolidated Net
Income; minus
4
(6) non-cash items increasing such Consolidated Net
Income for such period, other than the accrual of revenue in the
ordinary course of business; minus
(7) cash payments related to non-cash charges that
increased Consolidated Cash Flow in any prior period; minus
(8) barter revenues,
in each case, on a consolidated basis and determined in accordance with GAAP.
Notwithstanding the foregoing, the provision for taxes based on the
income or profits of, and the depreciation and amortization and other non-cash
expenses of, a Restricted Subsidiary will be added to Consolidated Net Income to
compute Consolidated Cash Flow of the Company only to the extent that a
corresponding amount would be permitted at the date of determination to be
dividended to the Company by such Subsidiary without prior governmental approval
(that has not been obtained), and without direct or indirect restriction
pursuant to the terms of its charter and all agreements, instruments, judgments,
decrees, orders, statutes, rules and governmental regulations applicable to that
Subsidiary or its stockholders.
"Consolidated Interest Expense" means, with respect to any Person for
any period, the sum, without duplication of:
(1) the consolidated interest expense of such Person and
the Restricted Subsidiaries for such period, whether paid or accrued
(including, without limitation, amortization of original issue
discount, non-cash interest payments, the interest component of any
deferred payment obligations, the interest component of all payments
associated with Capital Lease Obligations, imputed interest with
respect to commissions, discounts and other fees and charges incurred
in respect of letter of credit or bankers' acceptance financings, and
net payments (if any) pursuant to Hedging Obligations);
(2) the consolidated interest expense of such Person and
the Restricted Subsidiaries that was capitalized during such period;
(3) any interest expense on Indebtedness of another
Person that is guaranteed by such Person or any of the Restricted
Subsidiaries or secured by a Lien on assets of such Person or any of
the Restricted Subsidiaries (whether or not such Guarantee or Lien is
called upon); and
(4) the product of:
(a) all cash dividend payments (and non-cash
dividend payments in the case of a Person that is a Restricted
Subsidiary) on any series of preferred stock of such Person or any of
the Restricted Subsidiaries, times
(b) a fraction, the numerator of which is one
and the denominator of which is one minus the then current combined
federal, state and local statutory tax rate of such Person, expressed
as a decimal, in each case, on a consolidated basis and in accordance
with GAAP.
"Consolidated Net Income" means, with respect to any specified Person
for any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; provided that:
5
(1) the Net Income (to the extent positive) of any Person
other than a Restricted Subsidiary shall be included only the extent of
dividends and distributions paid in cash to the Company or a Restricted
Subsidiary by such Person;
(2) the Net Income of any Restricted Subsidiary shall be
excluded to the extent that the declaration or payment of dividends or
similar distributions by that Restricted Subsidiary of that Net Income
is not at the date of determination permitted without any prior
governmental approval (that has not been obtained) or, directly or
indirectly, by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Restricted Subsidiary or its
stockholders;
(3) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such
acquisition will be excluded; and
(4) the cumulative effect of a change in accounting
principles will be excluded.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Parent Guarantor who (i) was a member of
or nominated to such Board of Directors on the date of this First Supplemental
Indenture; or (ii) was nominated for election either (a) by one or more of the
Principals or (b) with the approval of at least a majority of the members of the
Board of Directors then in office who either were members of the Board of
Directors on the date of this First Supplemental Indenture or whose election or
nomination for election was previously so approved.
"Credit Agreement" means that certain Credit Agreement, dated as of
December 16, 1999, as amended through the date of this First Supplemental
Indenture, by and among Radio, as borrower, the Parent Guarantor, as guarantor,
Banc of America Securities LLC, as book manager, Key Corporate Capital Inc., as
administrative agent, Bank of America, N.A., as syndication agent and the
lenders party thereto, including any related notes, guarantees, letters of
credit, collateral documents, instruments and agreements executed in connection
therewith, as amended, extended, restated, supplemented, modified, renewed,
refunded, restructured, replaced or refinanced from time to time (including any
increase in principal amount), in whole or in part, whether with the original
agents and lenders or other agents and lenders, and whether provided under the
original credit agreement or one or more other credit agreements or otherwise.
"Credit Facilities" means, one or more debt facilities (including,
without limitation, the Credit Agreement) or commercial paper facilities, in
each case with banks or other institutional lenders providing for revolving
credit loans, term loans, receivables financing (including through the sale of
receivables to such lenders or to special purpose entities formed to borrow from
such lenders against such receivables) or letters of credit, in each case, as
amended, restated, modified, renewed, refunded, replaced or refinanced in whole
or in part from time to time (including any increase in principal amount), in
whole or in part.
"Custodian" means the Trustee, as custodian with respect to the Notes
in global form, or any successor entity thereto.
"Definitive Note" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.02 hereof,
substantially in the form of Exhibit A-1 hereto except that such Note shall not
bear the Global Note Legend and shall not have the "Schedule of Exchanges of
Interests in the Global Note" attached thereto.
"Designated Senior Indebtedness" means (i) any Indebtedness outstanding
under the Credit Agreement, including any guarantees in respect of such
Indebtedness; and (ii) any other Senior
6
Indebtedness permitted under this First Supplemental Indenture the principal
amount of which (or which is otherwise available under a committed facility) at
the date of determination is $25.0 million or more and that has been designated
by an Issuer or a Subsidiary Guarantor as "Designated Senior Indebtedness;"
provided, however, that, so long as the Credit Agreement remains in effect,
lenders holding a majority of the loan commitments or outstanding loans
thereunder shall have consented in writing to such designation by an Issuer or a
Subsidiary Guarantor unless the Credit Agreement expressly provides that such
lenders shall not have such right to consent to such designation.
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder of the Capital Stock), or
upon the happening of any event (other than an optional call for redemption by
the issuer thereof), matures or is mandatorily redeemable, pursuant to a sinking
fund obligation or otherwise, or is redeemable at the option of the holder of
the Capital Stock, in whole or in part, on or prior to the date on which the
Notes mature. Notwithstanding the preceding sentence, any Capital Stock that
would constitute Disqualified Stock solely because the holders of the Capital
Stock have the right to require the Company to repurchase such Capital Stock
upon the occurrence of a change of control or an asset sale will not constitute
Disqualified Stock if the terms of such Capital Stock provide that the Company
may not repurchase or redeem any such Capital Stock pursuant to such provisions
unless such repurchase or redemption complies with the provisions of Section
4.03.
"Domestic Subsidiary" means any Restricted Subsidiary that is formed
under the laws of the United States or any state of the United States or the
District of Columbia or that guarantees or otherwise provides direct credit
support for any Indebtedness of the Company.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Equity Offering" means an offering of Capital Stock (other than
Disqualified Stock) of the Company or an offering by any direct or indirect
parent of the Company of its Capital Stock in which the proceeds are contributed
to the Company, in each case which offering results in at least $25.0 million of
net proceeds to the Company.
"Existing Indebtedness" means Indebtedness of the Company and its
Restricted Subsidiaries (other than Indebtedness under the Credit Agreement) in
existence on the date of this First Supplemental Indenture.
"Existing Debentures" means the 6 1/4% Convertible Subordinated
Debentures due 2014 of the Parent Guarantor.
"Existing Debentures Indenture" means the Indenture dated as of October
6, 1999 by and between the Parent Guarantor, as issuer, and Wilmington Trust
Company, as Trustee with respect to the Existing Debentures.
"Global Notes" means, individually and collectively, the Global Notes,
substantially in the form of Exhibit A hereto issued in accordance with Section
2.01, 2.02(b)(ii) or 2.02(d) hereof.
"Global Note Legend" means the legend set forth in Section 2.02(f)
hereof, which is required to be placed on all Global Notes issued under this
First Supplemental Indenture.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
7
"Guarantee" means a guarantee other than by endorsement of negotiable
instruments for collection in the ordinary course of business, direct or
indirect, in any manner including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness.
"Guarantors" means the Parent Guarantor and the Subsidiary Guarantors.
"Hedging Obligations" means, with respect to any specified Person, the
obligations of such Person under (i) currency exchange or interest rate swap
agreements, interest rate cap agreements and currency exchange or interest rate
collar agreements and (ii) other agreements or arrangements designed to protect
such Person against fluctuations in currency exchange rates or interest rates.
"Indebtedness" means, with respect to any specified Person, any
indebtedness of such Person, whether or not contingent:
(1) in respect of borrowed money;
(2) evidenced by bonds, notes, debentures or similar
instruments or letters of credit (or reimbursement agreements in
respect thereof);
(3) in respect of banker's acceptances;
(4) representing Capital Lease Obligations;
(5) representing the balance deferred and unpaid of the
purchase price of any property, except any such balance that
constitutes an accrued expense or trade payable; or
(6) representing the aggregate net amount of all Hedging
Obligations,
if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not otherwise included, the Guarantee
by the specified Person of any indebtedness of any other Person; provided,
however, that Indebtedness shall not include the pledge of the Capital Stock of
an Unrestricted Subsidiary to secure Non-Recourse Debt of that Unrestricted
Subsidiary.
The amount of any Indebtedness outstanding as of any date will be:
(1) the accreted value of the Indebtedness, in the case
of any Indebtedness issued with original issue discount; and
(2) the principal amount of the Indebtedness, together with
any interest on the Indebtedness that is more than 30 days past due, in
the case of any other Indebtedness.
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Note through a Participant.
"Investments" means, with respect to any Person, all direct or indirect
investments by such Person in other Persons (including Affiliates) in the forms
of loans (including Guarantees or other obligations), advances or capital
contributions (excluding commission, travel and similar advances to officers and
employees made in the ordinary course of business), purchases or other
acquisitions for consideration of
8
Indebtedness, Equity Interests or other securities, together with all items that
are or would be classified as investments on a balance sheet prepared in
accordance with GAAP. If the Company or any Restricted Subsidiary sells or
otherwise disposes of any Equity Interests of any direct or indirect Restricted
Subsidiary or a Restricted Subsidiary issues any of its Equity Interests such
that, in each case, after giving effect to any such sale, disposition or
issuance, such Person is no longer a Restricted Subsidiary, the Company will be
deemed to have made an Investment on the date of any such sale or disposition
equal to the fair market value of the Equity Interests of such Restricted
Subsidiary not sold or disposed of in an amount determined as provided in the
final paragraph of Section 4.03.
"Leverage Ratio" means the ratio of (i) the aggregate outstanding
amount of Indebtedness of each of the Company and the Indebtedness of the
Restricted Subsidiaries as of the last day of the most recently ended fiscal
quarter for which the Company has filed consolidated financial statements with
the SEC, plus the aggregate liquidation preference of all outstanding
Disqualified Stock of the Company and outstanding preferred stock of the
Restricted Subsidiaries (except preferred stock issued to the Company or a
Restricted Subsidiary) as of such day to (ii) the aggregate Consolidated Cash
Flow of the Company for the last four full fiscal quarters for which the Company
has filed consolidated financial statements with the SEC or first provided
consolidated financial statements to the holders of the Notes ending on or prior
to the date of determination (the "Reference Period").
For purposes of this definition, the aggregate outstanding principal
amount of the Indebtedness of the Company and the Restricted Subsidiaries and
the aggregate liquidation preference of all Disqualified Stock and outstanding
preferred stock of the Restricted Subsidiaries for which such calculation is
made shall be determined on a pro forma basis as if the Indebtedness,
Disqualified Stock and preferred stock giving rise to the need to perform such
calculation had been incurred and issued and the proceeds therefrom had been
applied, and all other transactions in respect of which such Indebtedness is
being incurred or Disqualified Stock or preferred stock is being issued had
occurred, on the first day of such Reference Period. In addition to the
foregoing, for purposes of this definition, the Leverage Ratio shall be
calculated on a pro forma basis, after giving effect to (i) the incurrence of
the Indebtedness of such Person and the Restricted Subsidiaries and the issuance
of the Disqualified Stock or preferred stock (and the application of the
proceeds therefrom) giving rise to the need to make such calculation and any
incurrence (and the application of the proceeds therefrom) or repayment of other
Indebtedness, Disqualified Stock or preferred stock, at any time subsequent to
the beginning of the Reference Period and on or prior to the date of
determination (including any deemed incurrence or issuance which is the subject
of an Incurrence Notice delivered to the Trustee during such period pursuant to
clause (xiii) of the definition of Permitted Indebtedness), as if such
incurrence or issuance (and the application of the proceeds thereof), or the
repayment, as the case may be, occurred on the first day of the Reference Period
(except that, in making such computation, the amount of Indebtedness under any
revolving credit facility shall be computed based upon the average balance of
such Indebtedness at the end of each month during such period), and (ii) any
acquisition at any time on or subsequent to the first day of the Reference
Period and on or prior to the date of determination (including any deemed
acquisition which is the subject of an Incurrence Notice delivered to the
Trustee during such period pursuant to clause (xiii) of the definition of
Permitted Indebtedness), as if such acquisition or disposition (including the
incurrence, assumption or liability for, or repayment of, any such Indebtedness
and the issuance of such Disqualified Stock or preferred stock and also
including any Consolidated Cash Flow associated with such acquisition) and
occurred on the first day of the Reference Period giving pro forma effect to any
non-recurring expenses, non-recurring costs and cost reductions within the first
year after such acquisition the Company reasonably anticipates in good faith if
the Company delivers to the Trustee an officer's certificate executed by the
chief financial or accounting officer of the Company certifying to and
describing and quantifying in reasonable detail such non-recurring expenses,
non-recurring costs and cost reductions. Furthermore, in calculating
Consolidated Interest Expense for purposes of the calculation of Consolidated
Cash Flow, (a) interest on Indebtedness determined on a fluctuating basis as of
the date of determination (including Indebtedness actually incurred on the date
of the transaction giving rise to the need to calculate the Leverage Ratio) and
9
which will continue to be so determined thereafter shall be deemed to have
accrued at a fixed rate per annum equal to the rate of interest on such
Indebtedness as in effect on the date of determination and (b) notwithstanding
(a) above, interest determined on a fluctuating basis, to the extent such
interest is covered by Hedging Obligations, shall be deemed to accrue at the
rate per annum resulting after giving effect to the operation of such
agreements.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.
"LMA" means a local marketing arrangement, joint sales agreement, time
brokerage agreement, shared services agreement, management agreement or similar
arrangement pursuant to which a Person, subject to customary preemption rights
and other limitations (i) obtains the right to sell a portion of the advertising
inventory of a radio station of which a third party is the licensee, (ii)
obtains the right to exhibit programming and sell advertising time during a
portion of the air time of a radio station or (iii) manages a portion of the
operations of a radio station.
"Net Income" means, with respect to any specified Person, the net
income (loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however, (i) any
gain (but not loss), together with any related provision for taxes on such gain
(but not loss), realized in connection with (a) any Asset Sale, or (b) the
disposition of any securities by such Person or any Restricted Subsidiary or the
extinguishment of Indebtedness of such Person or any Restricted Subsidiary; and
(ii) any extraordinary gain (but not loss), together with any related provision
for taxes on such extraordinary gain (but not loss).
"Net Proceeds" means the aggregate cash proceeds received by the
Company or any Restricted Subsidiary in respect of any Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of any
non-cash consideration received in any Asset Sale), net of (i) the direct costs
relating to such Asset Sale, including, without limitation, legal, accounting
and investment banking fees, and sales commissions, and any relocation expenses
incurred as a result of the Asset Sale, (ii) taxes paid or payable as a result
of the Asset Sale, in each case, after taking into account any available tax
credits or deductions and any tax sharing arrangements, (iii) amounts required
to be applied to the repayment of Indebtedness, other than Senior Indebtedness
secured by a Lien on the asset or assets that were the subject of such Asset
Sale and (iv) any reserve for adjustment in respect of the sale price of such
asset or assets established in accordance with GAAP (but only for so long as and
to the extent such reserve is maintained in accordance with GAAP).
"Non-Recourse Debt" means Indebtedness:
(1) as to which neither the Company nor any Restricted
Subsidiary (a) provides credit support of any kind (including any
undertaking, agreement or instrument that would constitute
Indebtedness), (b) is directly or indirectly liable as a guarantor or
otherwise, or (c) constitutes the lender; and
(2) no default with respect to which (including any
rights that the holders of the Indebtedness may have to take
enforcement action against an Unrestricted Subsidiary) would permit
upon notice, lapse of time or both any holder of any other Indebtedness
(other than the Notes) of the Company or any Restricted Subsidiary to
declare a default on such other
10
Indebtedness or cause the payment of the Indebtedness to be accelerated
or payable prior to its stated maturity.
"Notes" has the meaning assigned to it in the preamble to this First
Supplemental Indenture. The Notes and the Additional Notes shall be treated as a
single class for all purposes under this First Supplemental Indenture.
"Obligations" means any principal (or accreted amount in the case of
any discount obligation), interest, premium, penalties, fees, indemnifications,
reimbursements, damages and other liabilities payable under the documentation
governing, creating, evidencing or securing any Indebtedness and in all cases
whether direct or indirect, absolute or contingent, now outstanding or hereafter
created, assumed or incurred and including, without limitation, interest
accruing subsequent to the filing of a petition in bankruptcy or the
commencement of any insolvency, reorganization or similar proceedings at the
rate provided in the relevant documentation, whether or not an allowed claim,
and any obligation to redeem or defease any of the foregoing.
"Offering" means the offering of the Notes by the Company.
"Parent Guarantor" means Entercom Communications Corp., in its capacity
as guarantor under this First Supplemental Indenture.
"Participant" means, with respect to the Depositary, a Person who has
an account with the Depositary.
"Permitted Asset Swap" means, with respect to the Company and the
Restricted Subsidiaries, the substantially concurrent exchange of assets of the
Company or a Restricted Subsidiary (including Equity Interests of a Restricted
Subsidiary) for assets of another Person, which assets are used in or useful to
a Permitted Business.
"Permitted Business" means any business engaged in by the Company or
the Restricted Subsidiaries as of the Closing Date or any business reasonably
related, ancillary or complementary thereto.
"Permitted Investments" means:
(1) any Investment in the Company or in a Restricted
Subsidiary;
(2) any Investment in Cash Equivalents;
(3) any Investment by the Company or any Restricted
Subsidiary in a Person, if as a result of such Investment:
(a) such Person becomes a Restricted Subsidiary;
or
(b) such Person is merged, consolidated or
amalgamated with or into, or transfers or conveys substantially all of
its assets to, or is liquidated into, the Company or a Restricted
Subsidiary;
(4) any Investment made as a result of the receipt of
non-cash consideration from an Asset Sale that was made pursuant to and
in compliance with Section 4.06;
11
(5) any acquisition of assets (including Investments in
Unrestricted Subsidiaries) solely in exchange for the issuance of
Equity Interests (other than Disqualified Stock) of the Company;
(6) notes and accounts receivable incurred in the
ordinary course of business and any Investments received in compromise
of obligations of any Person incurred in the ordinary course of trade
creditors or customers that were incurred in the ordinary course of
business, including pursuant to any plan of reorganization or similar
arrangement upon the bankruptcy or insolvency of any trade creditor or
customer;
(7) Hedging Obligations;
(8) loans and advances to employees of the Company or any
Restricted Subsidiary in the ordinary course of business not in excess
of $10.0 million in aggregate principal amount at any time outstanding;
or
(9) other Investments in any Person having an aggregate
fair market value (measured on the date each such Investment was made
and without giving effect to subsequent changes in value), that, when
taken together with all other Investments made pursuant to this clause
(9) do not exceed $20.0 million at any time outstanding.
"Permitted Junior Securities" means (i) Equity Interests in the Company
or the Parent Guarantor or, subject to the provisions of the Credit Agreement,
any Subsidiary Guarantor; or (ii) debt securities of an Issuer or any Guarantor
that are subordinated to all Senior Indebtedness and any debt securities issued
in exchange for Senior Indebtedness and subordinated to substantially the same
extent as, or to a greater extent than, the Notes and the Guarantees are
subordinated to Senior Indebtedness under this First Supplemental Indenture.
"Permitted Liens" means:
(1) Liens securing Senior Indebtedness that was permitted
by the terms of this First Supplemental Indenture to be incurred;
(2) Liens in favor of the Company or a Restricted
Subsidiary;
(3) Liens on property of a Person existing at the time
such Person is merged with or into or consolidated with the Company or
any Restricted Subsidiary of the Company; provided that such Liens were
in existence prior to the contemplation of such merger or consolidation
and do not extend to any assets other than those of the Person merged
into or consolidated with the Company or the Restricted Subsidiary;
(4) Liens on property existing at the time of acquisition
of the property by the Company or any Restricted Subsidiary; provided
that such Liens were in existence prior to the contemplation of such
acquisition;
(5) Liens to secure the performance of statutory
obligations, surety or appeal bonds, performance bonds or other
obligations of a like nature incurred in the ordinary course of
business;
(6) Liens to secure Indebtedness (including Capital Lease
Obligations) permitted by clause (iv) of the second paragraph of
Section 4.05 covering only the assets acquired with such Indebtedness;
12
(7) Liens existing on the date of this First Supplemental
Indenture;
(8) Liens for taxes, assessments or governmental charges
or claims that are not yet delinquent or that are being contested in
good faith by appropriate proceedings promptly instituted and
diligently concluded; provided that any reserve or other appropriate
provision as is required in conformity with GAAP has been made
therefor;
(9) Liens incurred in the ordinary course of business of
the Company or any Restricted Subsidiary with respect to obligations
that do not exceed an aggregate amount of $10.0 million at any one time
outstanding;
(10) Liens securing Permitted Refinancing Indebtedness
where the Liens securing the Indebtedness being refinanced were
permitted under this First Supplemental Indenture;
(11) easements, rights-of-way, zoning and similar
restrictions and other similar encumbrances or title defects incurred
or imposed, as applicable, in the ordinary course of business and
consistent with industry practices;
(12) any interest or title of a lessor under any Capital
Lease Obligation;
(13) Liens securing reimbursement obligations with respect
to commercial letters of credit which encumber documents and other
property relating to letters of credit and products and proceeds
thereof;
(14) Liens encumbering deposits made to secure statutory,
regulatory, contractual or warranty obligations, including rights of
offset and set-off;
(15) Liens securing Hedging Obligations which Hedging
Obligations relate to Indebtedness that is otherwise permitted under
this First Supplemental Indenture;
(16) leases or subleases granted to others;
(17) Liens under licensing agreements in the ordinary
course of business;
(18) judgment Liens not giving rise to an Event of
Default;
(19) Liens encumbering property of the Company or a
Restricted Subsidiary consisting of carriers, warehousemen, mechanics,
materialmen, repairmen and landlords, and other Liens arising by
operation of law and incurred in the ordinary course of business for
sums which are not overdue or which are being contested in good faith
by appropriate proceedings and (if so contested) for which appropriate
reserves with respect thereto have been established and maintained on
the books of the Company or a Restricted Subsidiary in accordance with
GAAP;
(20) Liens encumbering property of the Company or a
Restricted Subsidiary incurred in the ordinary course of business in
connection with workers' compensation, unemployment insurance, or other
forms of governmental insurance or benefits, or to secure performance
of bids, tenders, statutory obligations, leases, and contracts (other
than for Indebtedness) entered into in the ordinary course of business
of the Company or a Restricted Subsidiary; and
(21) Liens on assets of Unrestricted Subsidiaries that
secure Non-Recourse Debt of Unrestricted Subsidiaries.
13
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any Restricted Subsidiary issued in exchange for, or the net proceeds
of which are used to extend, refinance, renew, replace, defease or refund other
Indebtedness of the Company or any Restricted Subsidiary (other than
intercompany Indebtedness); provided that:
(1) the principal amount (or accreted value, if
applicable) of such Permitted Refinancing Indebtedness does not exceed
the principal amount (or accreted value, if applicable) of the
Indebtedness extended, refinanced, renewed, replaced, defeased or
refunded (plus all accrued interest on the Indebtedness and the amount
of all expenses and premiums incurred in connection therewith);
(2) such Permitted Refinancing Indebtedness has a final
maturity date later than the final maturity date of, and has a Weighted
Average Life to Maturity equal to or greater than the Weighted Average
Life to Maturity of, the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded;
(3) if the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded is subordinated in right of
payment to the Notes, such Permitted Refinancing Indebtedness has a
final maturity date later than the final maturity date of, and is
subordinated in right of payment to, the Notes on terms at
least as favorable to the Holders of Notes as those
contained in the documentation governing the Indebtedness
being extended, refinanced, renewed, replaced, defeased or
refunded; and
(4) such Indebtedness is incurred by the Company or by
the Restricted Subsidiary who is the obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded.
"Principals" means Joseph M. Field and David J. Field.
"Related Party" means:
(1) any immediate family member (in the case of an
individual) of any Principal; or
(2) any trust, corporation, partnership or other entity,
the beneficiaries, stockholders, partners, owners or Persons
beneficially holding an 80% or more controlling interest of which
consist of any one or more Principals and/or such other Persons
referred to in the immediately preceding clause (1).
"Representative" means, as the case may be, a trustee, agent or
representative appointed for the holders of any Senior Indebtedness under an
agreement to which such Senior Indebtedness was issued.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Subsidiary" means each of the current and future
Subsidiaries of the Company, other than Unrestricted Subsidiaries.
"SEC" means the Securities and Exchange Commission.
"Senior Indebtedness" means (i) all Indebtedness of the Company or any
Guarantor outstanding under the Credit Agreement and all Hedging Obligations
with respect thereto, (ii) any other Indebtedness of the Company or any
Guarantor permitted to be incurred under the terms of this First Supplemental
Indenture, unless the instrument under which such Indebtedness is incurred
expressly provides that it is
14
on a parity with or subordinated in right of payment to the Notes or any
Guarantee, and (iii) all Obligations with respect to the items listed in the
preceding clauses (i) and (ii). Notwithstanding anything to the contrary in the
preceding sentence, Senior Indebtedness will not include (w) any liability for
federal, state, local or other taxes owed or owing by an Issuer or a Guarantor,
(x) any intercompany Indebtedness of the Company, the Parent Guarantor or any
Restricted Subsidiary to the Company or any of its Affiliates; (y) any trade
payables; or (z) the portion of any Indebtedness that is incurred in violation
of this First Supplemental Indenture; provided, however, that, notwithstanding
the foregoing, solely with respect to the Parent Guarantor, during the time that
any Existing Debentures remain outstanding, Senior Indebtedness shall mean the
"Secured Senior Debt" of the Parent Guarantor (as defined in the Existing
Debentures Indenture).
"Senior Guarantees" means the Guarantees by the Guarantors of
Obligations under the Credit Facilities.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1.02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date hereof.
"Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which the payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and will not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Subsidiary Guarantee" means the Guarantee of a Subsidiary Guarantor
with respect to the Notes.
"Subsidiary Guarantors" means each of:
(1) the Restricted Subsidiaries on the date of this First Supplemental
Indenture; and
(2) any other of the Company's Subsidiaries that executes a Subsidiary
Guarantee in accordance with the provisions of this First Supplemental
Indenture; and
(3) each of their respective successors and assigns.
"Unrestricted Subsidiary" means any Subsidiary of the Company that is
designated by the Board of Directors as an Unrestricted Subsidiary pursuant to a
resolution of the Board of Directors, but only to the extent that such
Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement
or understanding with the Company or any Restricted Subsidiary unless
the terms of any such agreement, contract, arrangement or understanding
are no less favorable to the Company or such Restricted Subsidiary than
those that might be obtained at the time from Persons who are not
Affiliates of the Company;
(3) is a Person with respect to which neither the Company
nor any Restricted Subsidiary has any direct or indirect obligation to
maintain or preserve such Person's financial condition or to cause such
Person to achieve any specified levels of operating results; and
15
(4) has not guaranteed or otherwise directly or
indirectly provided credit support for any Indebtedness of the Company
or any Restricted Subsidiary.
Any designation of a Subsidiary of the Company as an Unrestricted
Subsidiary will be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution giving effect to such designation and an
Officers' Certificate certifying that such designation complied with the
preceding conditions and was permitted by the terms of Section 4.03 hereof. If,
at any time, any Unrestricted Subsidiary would fail to meet the preceding
requirements as an Unrestricted Subsidiary, it will thereafter cease to be an
Unrestricted Subsidiary for purposes of this First Supplemental Indenture and
any Indebtedness of such Subsidiary will be deemed to be incurred by a
Restricted Subsidiary as of such date and, if such Indebtedness is not permitted
to be incurred as of such date pursuant to Section 4.05, the Company will be in
default under such section. The Board of Directors may at any time designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such
designation will be deemed to be an incurrence of Indebtedness by a Restricted
Subsidiary of any outstanding Indebtedness of such Unrestricted Subsidiary and
such designation will only be permitted if (1) such Indebtedness is permitted
pursuant to Section 4.05 calculated on a pro forma basis as if such designation
had occurred at the beginning of the four-quarter reference period; and (2) no
Default or Event of Default would exist following such designation.
"Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing: (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect of the Indebtedness,
by (b) the number of years (calculated to the nearest one-twelfth) that will
elapse between such date and the making of such payment, by (ii) the then
outstanding principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any specified Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which (other than directors' qualifying shares)
will at the time be owned by such Person or by one or more Wholly Owned
Restricted Subsidiaries of such Person.
16
Section 1.02. Other Definitions.
Defined
in
Term Section
- ---- -------
"Additional Notes"................................................ 2.01
"Affiliate Transaction"........................................... 4.07
"Asset Sale Offer"................................................ 3.03
"Change of Control Offer"......................................... 4.09
"Change of Control Payment"....................................... 4.09
"Change of Control Payment Date".................................. 4.09
"Event of Default"................................................ 6.01
"Excess Proceeds"................................................. 4.06
"incur"........................................................... 4.05
"Incurrence Notice"............................................... 4.05
"Offer Amount".................................................... 3.03
"Offer Period".................................................... 3.03
"Payment Blockage Notice"......................................... 8.03
"Payment Default"................................................. 6.01
"Permitted Indebtedness".......................................... 4.05
"Purchase Date"................................................... 3.03
"Restricted Payments"............................................. 4.03
ARTICLE 2.
THE NOTES
Section 2.01. General.
(a) Designation of Series. Pursuant to the terms hereof and Section
2.01 of the Base Indenture, there is hereby established the Notes, known as the
"7-5/8% Senior Subordinated Notes due 2014," which shall be guaranteed by the
Guarantors, and such Notes and Guarantees shall be deemed "Securities" for all
purposes under the Base Indenture.
(b) Form of Notes. The Notes and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A hereto. The Notes
may have notations, legends or endorsements required by law, stock exchange rule
or usage. Each Note shall be dated the date of its authentication. The Notes
shall be in denominations of $1,000 and integral multiples thereof.
The Company may issue additional Notes (the "Additional Notes") under
this First Supplemental Indenture from time to time after the date hereof,
subject to compliance with Section 4.05 hereof. The Notes and any debt
securities subsequently issued under the Indenture (but not this First
Supplemental Indenture) shall be treated as distinct classes of debt securities
for all purposes under the Indenture, including waivers, amendments, redemptions
and offers to purchase.
The terms and provisions contained in the Notes shall constitute, and
are hereby expressly made, a part of the Indenture and the Company, the
Guarantors and the Trustee, by their execution and delivery of the Indenture,
expressly agree to such terms and provisions and to be bound thereby. However,
to the extent any provision of any Note conflicts with the express provisions of
the Indenture, the provisions of the Indenture shall govern and be controlling.
17
(c) Global Notes. Notes issued in global form shall be substantially in
the form of Exhibit A attached hereto (including the Global Note Legend thereon
and the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Notes issued in definitive form shall be substantially in the form of
Exhibit A attached hereto (but without the Global Note Legend thereon and
without the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Each Global Note shall represent such of the outstanding Notes as
shall be specified therein and each shall provide that it shall represent the
aggregate principal amount of outstanding Notes from time to time endorsed
thereon and that the aggregate principal amount of outstanding Notes represented
thereby may from time to time be reduced or increased, as appropriate, to
reflect exchanges and redemptions. Any endorsement of a Global Note to reflect
the amount of any increase or decrease in the aggregate principal amount of
outstanding Notes represented thereby shall be made by the Trustee or the
Custodian, at the direction of the Trustee, in accordance with instructions
given by the Holder thereof as required by Section 2.02 hereof.
The Company initially appoints the Depositary Trust Company ("DTC") to
act as Depositary with respect to the Global Notes.
Section 2.02. Transfer and Exchange.
Pursuant to Section 9.01 of the Base Indenture, this Section 2.02
hereby supercedes and replaces in their entirety Section 2.06 and Section
2.13(b) and (c) of the Base Indenture.
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes will be exchanged by
the Company for Definitive Notes if (i) the Company delivers to the Trustee
notice from the Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under the
Exchange Act and, in either case, a successor Depositary is not appointed by the
Company within 120 days after the date of such notice from the Depositary or
(ii) the Company in its sole discretion determines that the Global Notes (in
whole but not in part) should be exchanged for Definitive Notes and delivers a
written notice to such effect to the Trustee. Upon the occurrence of either of
the preceding events in (i) or (ii) above, Definitive Notes shall be issued in
such names as the Depositary shall instruct the Trustee. Global Notes also may
be exchanged or replaced, in whole or in part, as provided in this Section 2.02.
Every Note authenticated and delivered in exchange for, or in lieu of, a Global
Note or any portion thereof, pursuant to this Section 2.02, shall be
authenticated and delivered in the form of, and shall be, a Global Note. A
Global Note may not be exchanged for another Note other than as provided in this
Section 2.02(a); however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.02(b), (c) or (e) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global Notes.
The transfer and exchange of beneficial interests in the Global Notes shall be
effected through the Depositary, in accordance with the provisions of this First
Supplemental Indenture and the Applicable Procedures. Transfers of beneficial
interests in the Global Notes also shall require compliance with either
subparagraph (i) or (ii) below, as applicable:
(i) Transfer of Beneficial Interests in the Same Global
Note. Beneficial interests in any Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest
in a Global Note. No written orders or instructions shall be required
to be delivered to the Registrar to effect the transfers described in
this Section 2.02(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial
Interests in Global Notes. In connection with all transfers and
exchanges of beneficial interests that are not subject to Section
18
2.02(b)(i) above, the transferor of such beneficial interest must
deliver to the Registrar either (A) (1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to
credit or cause to be credited a beneficial interest in another Global
Note in an amount equal to the beneficial interest to be transferred or
exchanged and (2) instructions given in accordance with the Applicable
Procedures containing information regarding the Participant account to
be credited with such increase or (B) (1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to
cause to be issued a Definitive Note in an amount equal to the
beneficial interest to be transferred or exchanged and (2) instructions
given by the Depositary to the Registrar containing information
regarding the Person in whose name such Definitive Note shall be
registered to effect the transfer or exchange referred to in (1) above.
Upon satisfaction of all of the requirements for transfer or exchange
of beneficial interests in Global Notes contained in this First
Supplemental Indenture and the Notes or otherwise applicable under the
Securities Act, and upon receipt by the Trustee of an Opinion of
Counsel, reasonably acceptable to the Trustee, with respect to such
matters, if requested by the Trustee, the Trustee shall adjust the
principal amount of the relevant Global Note(s) pursuant to Section
2.02(g) hereof.
(c) Transfer or Exchange of Beneficial Interests for Definitive Notes.
If any holder of a beneficial interest in a Global Note proposes to exchange
such beneficial interest for a Definitive Note or to transfer such beneficial
interest to a Person who takes delivery thereof in the form of a Definitive
Note, then, upon satisfaction of the conditions set forth in Section 2.02(b)(ii)
hereof, the Trustee shall cause the aggregate principal amount of the applicable
Global Note to be reduced accordingly pursuant to Section 2.02(g) hereof, and
the Company shall execute and the Trustee shall authenticate and deliver to the
Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest pursuant to this Section 2.02(c) shall be registered in such name or
names and in such authorized denomination or denominations as the holder of such
beneficial interest shall instruct the Registrar through instructions from the
Depositary and the Participant or Indirect Participant. The Trustee shall
deliver such Definitive Notes to the Persons in whose names such Notes are so
registered.
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests.
A Holder of a Definitive Note may exchange such Note for a beneficial interest
in a Global Note or transfer such Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in a Global Note at any
time. Upon receipt of a request for such an exchange or transfer, the Trustee
shall cancel the applicable Definitive Note and increase or cause to be
increased the aggregate principal amount of one of the Global Notes.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes. A
Holder of Definitive Notes may transfer such Notes to a Person who takes
delivery thereof in the form of another Definitive Note. Upon receipt of a
request to register such a transfer, the Registrar shall register the Definitive
Notes pursuant to the instructions from the Holder thereof. Upon request by a
Holder of Definitive Notes and such Holder's compliance with the provisions of
this Section 2.02(e), the Registrar shall register the transfer or exchange of
Definitive Notes. Prior to such registration of transfer or exchange, the
requesting Holder shall present or surrender to the Registrar the Definitive
Notes duly endorsed or accompanied by a written instruction of transfer in form
satisfactory to the Registrar duly executed by such Holder or by its attorney,
duly authorized in writing.
(f) Legend. The following legend shall appear on the face of all Global
Notes issued under this First Supplemental Indenture in substantially the
following form:
19
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.02 OF THE BASE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.02(a) OF THE FIRST
SUPPLEMENTAL INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE
FOR CANCELLATION PURSUANT TO SECTION 2.10 OF THE BASE INDENTURE AND (IV) THIS
GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF THE COMPANY."
(g) Cancellation and/or Adjustment of Global Notes. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or
retained and canceled by the Trustee in accordance with Section 2.10 of the Base
Indenture. At any time prior to such cancellation, if any beneficial interest in
a Global Note is exchanged for or transferred to a Person who will take delivery
thereof in the form of a beneficial interest in another Global Note or for
Definitive Notes, the principal amount of Notes represented by such Global Note
shall be reduced accordingly and an endorsement shall be made on such Global
Note by the Trustee or by the Depositary at the direction of the Trustee to
reflect such reduction; and if the beneficial interest is being exchanged for or
transferred to a Person who will take delivery thereof in the form of a
beneficial interest in another Global Note, such other Global Note shall be
increased accordingly and an endorsement shall be made on such Global Note by
the Trustee or by the Depositary at the direction of the Trustee to reflect such
increase.
(h) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges,
the Company shall execute and the Trustee shall authenticate Global
Notes and Definitive Notes upon the Company's order or at the
Registrar's request.
(ii) No service charge shall be made to a holder of a
beneficial interest in a Global Note or to a Holder of a Definitive
Note for any registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other than
any such transfer taxes or similar governmental charge payable upon
exchange or transfer pursuant to Section 2.10 of the Base Indenture and
Sections 3.01, 3.03, 4.06, 4.09 and 8.05 hereof).
(iii) The Registrar shall not be required to register the
transfer of or exchange any Note selected for redemption in whole or in
part, except the unredeemed portion of any Note being redeemed in part.
(iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive
Notes shall be the valid obligations of the Company, evidencing the
same debt, and entitled to the same benefits under this First
Supplemental Indenture, as the Global Notes or Definitive Notes
surrendered upon such registration of transfer or exchange.
(v) The Company shall not be required (A) to issue, to
register the transfer of or to exchange any Notes during a period
beginning at the opening of business 15 days before the day of any
selection of Notes for redemption under Section 3.02 of the Base
Indenture and ending at the close of business on the day of selection,
(B) to register the transfer of or to exchange any
20
Note so selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part or (C) to
register the transfer of or to exchange a Note between a record date
and the next succeeding Interest Payment Date.
(vi) Prior to due presentment for the registration of a
transfer of any Note, the Trustee, any Agent and the Company may deem
and treat the Person in whose name any Note is registered as the
absolute owner of such Note for the purpose of receiving payment of
principal of and interest on such Notes and for all other purposes
(subject to the provisions of the Notes for record dates), and none of
the Trustee, any Agent or the Company shall be affected by notice to
the contrary.
(vii) The Trustee shall authenticate Global Notes and
Definitive Notes in accordance with the provisions of Section 2.02 of
the Base Indenture.
(viii) All certifications, certificates and Opinions of
Counsel required to be submitted to the Registrar pursuant to this
Section 2.02 to effect a registration of transfer or exchange may be
submitted by facsimile.
Section 2.03. Treasury Notes.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company, shall be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes that the Trustee knows are so owned shall be so disregarded.
ARTICLE 3.
REDEMPTION AND PREPAYMENT
Pursuant to Sections 2.01(g) and (h) of the Base Indenture, the
following provisions are hereby added to Article 3 of the Base Indenture:
Section 3.01. Optional Redemption.
(a) Except as set forth in clause (b) of this Section 3.01, the Company
shall not have the option pursuant to this Section 3.01 to redeem the Notes
prior to March 1, 2007. Thereafter, the Company shall have the option to redeem
the Notes, in whole or in part, upon not less than 30 nor more than 60 days'
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below plus accrued and unpaid interest thereon to the applicable
redemption date, if redeemed during the twelve-month period beginning on March 1
of each of the years indicated below:
Year Percentage
- ---- ----------
2007............................................................. 103.813%
2008............................................................. 102.542%
2009............................................................. 101.271%
2010 and thereafter.............................................. 100.00%
(b) Notwithstanding the provisions of clause (a) of this Section 3.01,
at any time prior to March 1, 2005, the Company may, on any one or more
occasions redeem up to 35% of the aggregate principal amount of Notes issued
under this First Supplemental Indenture with the net proceeds of one or more
Equity Offerings at a redemption price equal to 107.625% of the aggregate
principal amount
21
thereof; provided that at least 65% in aggregate principal amount of the Notes
originally issued remain outstanding immediately after the occurrence of such
redemption and that such redemption occurs within 180 days of the date of the
closing of such Equity Offering.
(c) Any redemption pursuant to this Section 3.01 shall be made pursuant
to the provisions of Section 3.01 through 3.06 of the Base Indenture.
Section 3.02. Mandatory Redemption.
The Company shall not be required to make mandatory redemption or
sinking fund payments with respect to the Notes.
Section 3.03. Offer to Purchase by Application of Excess Proceeds.
In the event that, pursuant to Section 4.06 hereof, the Company shall
be required to commence an offer to all Holders to purchase Notes (an "Asset
Sale Offer"), it shall follow the procedures specified below.
The Asset Sale Offer shall remain open for a period of 20 Business Days
following its commencement and no longer, except to the extent that a longer
period is required by applicable law (the "Offer Period"). No later than five
Business Days after the termination of the Offer Period (the "Purchase Date"),
the Company shall purchase the principal amount of Notes required to be
purchased pursuant to Section 4.06 hereof (the "Offer Amount") or, if less than
the Offer Amount has been tendered, all Notes tendered in response to the Asset
Sale Offer. Payment for any Notes so purchased shall be made in the same manner
as interest payments are made.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest shall
be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no additional interest shall be payable to
Holders who tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, the Company shall send,
by first class mail, a notice to the Trustee and each of the Holders, with a
copy to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Asset Sale
Offer. The Asset Sale Offer shall be made to all Holders. The notice, which
shall govern the terms of the Asset Sale Offer, shall state:
(a) that the Asset Sale Offer is being made pursuant to this Section
3.03 and Section 4.06 hereof and the length of time the Asset Sale Offer shall
remain open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall continue
to accrete or accrue interest;
(d) that, unless the Company defaults in making such payment, any Note
accepted for payment pursuant to the Asset Sale Offer shall cease to accrete or
accrue interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to an Asset
Sale Offer may elect to have Notes purchased in integral multiples of $1,000
only;
22
(f) that Holders electing to have a Note purchased pursuant to any
Asset Sale Offer shall be required to surrender the Note, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Note completed, or
transfer by book-entry transfer, to the Company, a depositary, if appointed by
the Company, or a Paying Agent at the address specified in the notice at least
three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if the
Company, the depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Note purchased;
(h) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Offer Amount, the Company shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Company so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in part shall be
issued new Notes equal in principal amount to the unpurchased portion of the
Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, the
Offer Amount of Notes or portions thereof tendered pursuant to the Asset Sale
Offer, or if less than the Offer Amount has been tendered, all Notes tendered,
and shall deliver to the Trustee an Officers' Certificate stating that such
Notes or portions thereof were accepted for payment by the Company in accordance
with the terms of this Section 3.03. The Company, the Depositary or the Paying
Agent, as the case may be, shall promptly (but in any case not later than five
days after the Purchase Date) mail or deliver to each tendering Holder an amount
equal to the purchase price of the Notes tendered by such Holder and accepted by
the Company for purchase, and the Company shall promptly issue a new Note, and
the Trustee, upon written request from the Company shall authenticate and mail
or deliver such new Note to such Holder, in a principal amount equal to any
unpurchased portion of the Note surrendered. Any Note not so accepted shall be
promptly mailed or delivered by the Company to the Holder thereof. The Company
shall publicly announce the results of the Asset Sale Offer on the Purchase
Date.
Other than as specifically provided in this Section 3.03, any purchase
pursuant to this Section 3.03 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 of the Base Indenture.
ARTICLE 4.
COVENANTS
Pursuant to Section 2.01(l) of the Base Indenture, so long as any of
the Notes are outstanding, the Company covenants and agrees, in addition to the
covenants and agreements contained in Article 4 of the Base Indenture, as
follows with respect to the Notes; provided that Section 4.07 of the Base
Indenture shall not be applicable to the Notes:
Section 4.01. Additional Interest on Defaulted Interest.
The following paragraph shall supercede and replace in its entirety the
second paragraph of Section 4.01 of the Base Indenture:
23
The Company shall jointly and severally pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal at the rate equal to 1% per annum in excess of the then applicable
interest rate on the Notes to the extent lawful; it shall pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue installments of interest (without regard to any applicable grace period)
at the same rate to the extent lawful.
Section 4.02. Reports.
The following provisions shall supercede and replace in its entirety
the Section 4.03 of the Base Indenture:
(a) Whether or not required by the SEC, so long as any Notes are
outstanding, the Company shall furnish to the Holders of Notes, within the time
periods specified in the SEC's rules and regulations for a company subject to
Section 13 or 15(d) under the Exchange Act: (i) all quarterly and annual
financial information that would be required to be contained in a filing with
the SEC on Forms 10-Q and 10-K if the Company (or, taking into account Rule 3-10
of Regulation S-X or any successor rule or regulation, the Parent Guarantor)
were required to file such forms, including a "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and, with respect to
the annual information only, a report on the annual financial statements by the
Company's (or the Parent Guarantor's) certified independent accountants; and
(ii) all current reports that would be required to be filed with the SEC on Form
8-K if the Company (or the Parent Guarantor) were required to file such reports.
The Company shall at all times comply with TIA [sec] 314(a).
(b) If either of the Company or any Subsidiary Guarantor has designated
any of its Subsidiaries as Unrestricted Subsidiaries, then the quarterly and
annual financial information required by the preceding paragraph will include,
either on the face of the financial statements or in the footnotes thereto, and
in Management's Discussion and Analysis of Financial Condition and Results of
Operations, of the financial condition and results of operations, a reasonably
detailed summary of the Company and the Restricted Subsidiaries separate from
the financial condition and results of operations of the Unrestricted
Subsidiaries containing line items substantially consistent with those contained
in the summary section of the offering memorandum with respect to the Offering.
Section 4.03. Restricted Payments.
The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly: (i) declare or pay any dividend or make any other
payment or distribution on account of the Company's or any Restricted
Subsidiary's Equity Interests (including, without limitation, any payment in
connection with any merger or consolidation involving the Company or any
Restricted Subsidiary) or to the direct or indirect holders of the Company's or
any Restricted Subsidiary's Equity Interests in their capacity as such (other
than dividends or distributions payable in Equity Interests (other than
Disqualified Stock) of the Company and other than dividends or distributions
payable to the Company or a Restricted Subsidiary); (ii) purchase, redeem or
otherwise acquire or retire for value (including, without limitation, in
connection with any merger or consolidation involving the Company) any Equity
Interests of the Company or of any direct or indirect parent of the Company
(other than any such Equity Interests owned by the Company or a Restricted
Subsidiary); (iii) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value any Indebtedness that is
subordinated to the Notes or the Subsidiary Guarantees, except a payment of
interest or principal at the Stated Maturity thereof (except for payments into a
trust within one year of the stated maturity of any such Subordinated
Indebtedness which payments effect a defeasance or discharge of such
Indebtedness); or (iv) make any Restricted Investment (all such payments and
other actions set forth in clauses (i) through (iv) above being collectively
referred to as "Restricted Payments"), unless, at the time of and after giving
effect to such Restricted Payment:
24
(a) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence of such Restricted Payment;
(b) the Company, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been made at
the beginning of the applicable four-quarter period, would have been permitted
to incur at least $1.00 of additional Indebtedness pursuant to the Leverage
Ratio test set forth in Section 4.05 hereof; and
(c) such Restricted Payment, together with the aggregate amount of all
other Restricted Payments made by the Company and its Restricted Subsidiaries on
or after the date of this First Supplemental Indenture (excluding Restricted
Payments permitted by clauses (b), (c), (d), (e), (f) and (g), of the next
succeeding paragraph), is less than the sum, without duplication, of:
(i) (x) 100% of the aggregate Consolidated Cash Flow of
the Company (or, in the event such Consolidated Cash Flow shall be a
deficit, minus 100% of such deficit) accrued for the period beginning
on the first day of the first calendar month commencing after the date
of this First Supplemental Indenture and ending on the last day of the
most recently completed fiscal quarter for which the Company has filed
consolidated financial statements with the SEC or first provided
consolidated financial statements to Holders of the Notes, less (y) 1.4
times Consolidated Interest Expense for the same period, plus
(ii) 100% of the aggregate net proceeds (including the
fair market value of property other than cash or Cash Equivalents)
received by the Company on or after the date of this First Supplemental
Indenture from (a) any parent as a capital contribution or (b) the
issue or sale of Equity Interests of the Company (other than
Disqualified Stock), or of Disqualified Stock or debt securities of the
Company that have been converted into such Equity Interests (other than
Equity Interests (or Disqualified Stock or convertible debt securities)
sold to a Restricted Subsidiary and other than Disqualified Stock or
convertible debt securities that have been converted into Disqualified
Stock), plus
(iii) to the extent that any Unrestricted Subsidiary is
redesignated as a Restricted Subsidiary after the date of this First
Supplemental Indenture, the fair market value of the Company's
Investment in such Subsidiary as of the date of such redesignation,
plus
(iv) to the extent that all or any part of a Restricted
Investment is sold for cash or otherwise liquidated, retired or repaid
for cash, the lesser of (a) the net cash proceeds received by us or any
Restricted Subsidiary therefrom (less the cost of disposition, if any)
and (b) the initial amount of such Restricted Investment, plus
(v) the aggregate amount returned in cash with respect to
Restricted Investments made after the date of this First Supplemental
Indenture whether through interest payments, principal payments,
dividends or other distributions.
The preceding provisions shall not prohibit:
(a) the payment of any dividend within 60 days after the
date of declaration of the dividend, if at the date of declaration the
dividend payment would have complied with the provisions of this First
Supplemental Indenture;
(b) the redemption, repurchase, retirement, defeasance or
other acquisition of any subordinated Indebtedness of the Company or
any Restricted Subsidiary or of any Equity Interests of the Company in
exchange for, or out of the net cash proceeds of the substantially
25
concurrent sale (other than to a Restricted Subsidiary) of, Equity
Interests of the Company (other than Disqualified Stock); provided that
the amount of any such net cash proceeds that are utilized for any such
redemption, repurchase, retirement, defeasance or other acquisition
shall be excluded from clause (c) (ii) of the preceding paragraph;
(c) the defeasance, redemption, repurchase or other
acquisition of subordinated Indebtedness of the Company or any
Restricted Subsidiary with the net cash proceeds from an incurrence of
Permitted Refinancing Indebtedness;
(d) the payment of any dividend by a Restricted
Subsidiary of the Company to the holders of its common Equity Interests
on a pro rata basis;
(e) payment of dividends on Disqualified Stock the
incurrence of which was permitted by this First Supplemental Indenture;
(f) repurchases of Equity Interests deemed to occur upon
the cashless exercise of stock options; and
(g) dividends or distributions by the Company to the
Parent Guarantor for (i) bona fide costs and operating expenses
directly related to the operations of the Company and the Restricted
Subsidiaries, (ii) other bona fide costs and expenses not to exceed an
aggregate of $15.0 million in any calendar year, plus (iii) so long as
no Default or Event of Default has occurred and is continuing, amounts
necessary to fund interest payments and other required payments on the
Existing Debentures, except during any period during which interest on
the Existing Debentures has been deferred in accordance with their
terms.
The amount of all Restricted Payments (other than cash) shall be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Company or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
The fair market value of any assets or securities that are required to be valued
by this Section 4.03 shall be determined by the Board of Directors whose
resolution with respect thereto shall be delivered to the Trustee. The Board of
Director's determination must be based upon an opinion or appraisal issued by an
accounting, appraisal or investment banking firm of national standing if such
fair market value exceeds $10.0 million.
Section 4.04. Dividend and Other Payment Restrictions Affecting
Subsidiaries.
The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, create or permit to exist or become effective any
consensual encumbrance or restriction on the ability of any Restricted
Subsidiary to:
(a) pay dividends or make any other distributions on its Capital Stock
to an Issuer or any Restricted Subsidiary, or with respect to any other interest
or participation in, or measured by, its profits, or pay any indebtedness owed
to the Company or any Restricted Subsidiary;
(b) make loans or advances to the Company or any Restricted Subsidiary;
or
(c) transfer any of its properties or assets to the Company or any
Restricted Subsidiary.
However, the preceding restrictions shall not apply to encumbrances or
restrictions existing under or by reason of:
26
(i) agreements governing Existing Indebtedness and Credit
Facilities as in effect on the date of this First Supplemental
Indenture and any amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings of
those agreements; provided that such amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacement
or refinancings are no more restrictive, taken as a whole, with respect
to such dividend and other payment restrictions than those contained in
those agreements as in effect on the date of this First Supplemental
Indenture;
(ii) this First Supplemental Indenture, the Notes and the
Subsidiary Guarantees;
(iii) applicable law, rule, regulation or order;
(iv) any instrument governing Indebtedness of a Person
acquired by the Company or any Restricted Subsidiary as in effect at
the time of such acquisition, which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person,
other than the Person, or the property or assets of the Person, so
acquired; provided that, in the case of Indebtedness, such Indebtedness
was permitted by the terms of this First Supplemental Indenture to be
incurred;
(v) customary non-assignment provisions in leases entered
into in the ordinary course of business and consistent with past
practices;
(vi) purchase money obligations (including Capital Lease
Obligations) for property acquired in the ordinary course of business
that impose restrictions only on that property of the nature described
in clause (c) above;
(vii) contracts for the sale of assets, including without
limitation any agreement for the sale or other disposition of a
Restricted Subsidiary that restricts distributions by that Restricted
Subsidiary pending its sale or other disposition;
(viii) Permitted Refinancing Indebtedness; provided that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are no more restrictive, taken as a whole,
than those contained in the agreements governing the Indebtedness being
refinanced;
(ix) Liens securing Indebtedness otherwise permitted to be
incurred under the provisions of Section 4.08 hereof that limit the
right of the debtor to dispose of the assets subject to such Liens;
(x) provisions with respect to the disposition or
distribution of assets or property in joint venture agreements, assets
sale agreements, stock sale agreements and other similar agreements
entered into in the ordinary course of business; and
(xi) restrictions on cash or other deposits or net worth
imposed by customers under contracts entered into in the ordinary
course of business.
Section 4.05. Incurrence of Indebtedness and Issuance of Preferred Stock.
The Company shall not, and shall cause its Restricted Subsidiaries not
to, directly, or indirectly, create, incur, issue, assume, guarantee or
otherwise become directly or indirectly liable, contingently or otherwise, with
respect to (collectively, "incur") any Indebtedness (including Acquired Debt),
Disqualified Stock or preferred stock; provided, however, that the Company or
any Subsidiary Guarantor may incur Indebtedness (including Acquired Debt) or
issue shares of Disqualified Stock if the Company's
27
Leverage Ratio at the time of incurrence of such Indebtedness or the issuance of
such Disqualified Stock or such preferred stock, as the case may be, after
giving pro forma effect to such incurrence or issuance as of such date and to
the use of the proceeds therefrom as if the same had occurred at the beginning
of the most recently ended four full fiscal quarter period of the Company for
which the Company has filed consolidated financial statements with the SEC or
first provided consolidated financial statements to Holders of the Notes, would
have been no greater than 7.0 to 1.
The provisions of the first paragraph of this Section 4.05 shall not
prohibit any of the following (collectively, "Permitted Indebtedness"):
(i) the incurrence by the Company and any Subsidiary
Guarantor of additional Indebtedness and letters of credit under
Credit Facilities in an aggregate principal amount at any one time
outstanding under this clause (i) (with letters of credit being
deemed to have a principal amount equal to the maximum potential
liability of the Company and its Restricted Subsidiaries thereunder)
not to exceed $650.0 million less the aggregate amount applied by the
Company or the Subsidiary Guarantors to permanently reduce the
availability of Indebtedness under the Credit Agreement pursuant to
Section 4.06 hereof;
(ii) the incurrence by the Company and its Restricted
Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and the Subsidiary
Guarantors of Indebtedness represented by the Notes and the related
Subsidiary Guarantees to be issued on the date of this First
Supplemental Indenture;
(iv) the incurrence by the Company or any Restricted
Subsidiary of Indebtedness represented by Capital Lease Obligations,
mortgage financings or purchase money obligations, in each case
incurred for the purpose of financing all or any part of the purchase
price or cost of construction or improvement of property, plant or
equipment whether through the direct purchase of assets or at least a
majority of the Voting Stock of any person owning such assets, in an
aggregate principal amount, including all Permitted Refinancing
Indebtedness incurred to refund, refinance or replace any
Indebtedness incurred pursuant to this clause (iv) not to exceed
$20.0 million at any time outstanding;
(v) the incurrence by the Company or any Restricted
Subsidiary of Permitted Refinancing Indebtedness in exchange for, or
the proceeds of which are used to refund, refinance or replace
Indebtedness (other than intercompany Indebtedness) that was permitted
by this First Supplemental Indenture to be incurred under the first
paragraph of this Section 4.05, this clause (v) or clauses (ii), (iii),
(iv), (xii) or (xiii) of this paragraph.
(vi) the incurrence by the Company or any Restricted
Subsidiary of intercompany Indebtedness between or among the Company
and any of its Restricted Subsidiaries; provided, however, that (a)
if we or a Subsidiary Guarantor is the obligor on intercompany
Indebtedness owed to a Restricted Subsidiary that is not a Subsidiary
Guarantor, such intercompany Indebtedness must be expressly
subordinated to the prior payment in full in cash of all Obligations
with respect to the Notes or the relevant Subsidiary Guarantee, as
applicable, and (b)(x) any subsequent issuance or transfer of Equity
Interests that results in any such Indebtedness being held by a
Person other than the Company or a Restricted Subsidiary of the
Company or (y) any sale or other transfer of any such Indebtedness to a
Person other than the Company or a Restricted Subsidiary of the
Company, shall be deemed, in each case, to constitute at the time of
such issuance or transfer an incurrence of such Indebtedness by the
Company or such Restricted Subsidiary, as the case may be, that was
not permitted by this clause (vi);
28
(vii) the incurrence by the Company or any Restricted
Subsidiary of Hedging Obligations that are incurred for the purpose of
fixing or hedging (x) interest rate risk with respect to any floating
rate Indebtedness that is permitted by the terms of this First
Supplemental Indenture to be outstanding or (y) currency exchange rate
risk in the ordinary course of business;
(viii) the guarantee by the Company of Indebtedness of any
of Restricted Subsidiary or by any Restricted Subsidiary of
Indebtedness of the Company or any other Restricted Subsidiary, in each
case that is permitted to be incurred by another provision of this
covenant; provided, however, that such guarantee may be on a senior
basis if the Indebtedness being guaranteed is Senior Indebtedness, but
otherwise shall be pari passu with any Indebtedness being guaranteed
that is pari passu with the Notes or the relevant Subsidiary Guarantee,
or shall be on a subordinated basis if the Indebtedness being
guaranteed is subordinated to the Notes or the relevant Subsidiary
Guarantee, in which event such guarantee shall be subordinated at least
to the same extent as the Indebtedness being guaranteed is subordinated
to the Notes or the relevant Subsidiary Guarantee, as the case may be;
(ix) the incurrence of Indebtedness by the Company or any
Restricted Subsidiary constituting reimbursement obligations with
respect to letters of credit issued in the ordinary course of business,
including without limitation letters of credit in respect to workers'
compensation claims or self-insurance, or other Indebtedness with
respect to reimbursement type obligations regarding workers'
compensation claims; provided, however, that upon the drawing of such
letters of credit or the incurrence of such Indebtedness, such
obligations are reimbursed within 30 days following such drawing or
incurrence;
(x) the incurrence of Obligations in respect of
performance and surety bonds and completion guarantees provided by the
Company or any Restricted Subsidiary in the ordinary course of
business;
(xi) the incurrence by any Unrestricted Subsidiary of
Non-Recourse Debt, provided, however, that if any such Indebtedness
ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such
event will be deemed to constitute an incurrence of Indebtedness by a
Restricted Subsidiary of the Company that was not permitted by this
clause (xi);
(xii) the incurrence by the Company or any Restricted
Subsidiary of additional Indebtedness in an aggregate principal amount
(or accreted value, as applicable) at any time outstanding, including
all Permitted Refinancing Indebtedness incurred to refund, refinance or
replace any Indebtedness incurred pursuant to this clause (xii), not to
exceed $20.0 million; and
(xiii) Acquisition Debt of the Company or a Restricted
Subsidiary if (a) such Acquisition Debt is incurred within 270 days
after the date on which the related definitive acquisition agreement or
LMA, as the case may be, was entered into by the Company or such
Restricted Subsidiary, (b) the aggregate principal amount of such
Acquisition Debt is no greater than the aggregate principal amount of
Acquisition Debt set forth in a notice from the Company to the Trustee
(an "Incurrence Notice") within ten days after the date on which the
related definitive acquisition agreement or LMA, as the case may be,
was entered into by the Company or such Restricted Subsidiary, which
notice shall be executed on the Company's behalf by the chief financial
officer of the Company in such capacity and shall describe in
reasonable detail the acquisition or LMA, as the case may be, which
such Acquisition Debt shall be incurred to finance, (c) after giving
pro forma effect to the acquisition or LMA, as the case may be,
described in such Incurrence Notice, the Company or such Restricted
Subsidiary could have incurred such Acquisition Debt under the first
paragraph of this Section 4.05 as of the date upon which the Company
delivers such Incurrence Notice to the Trustee and (d) such Acquisition
Debt, when
29
actually incurred, is utilized solely to finance the acquisition or
LMA, as the case may be, described in such Incurrence Notice (including
to repay or refinance indebtedness or other obligations incurred in
connection with such acquisition or LMA, as the case may be, and to pay
related fees and expenses); provided, however, that the Company shall
be entitled to deliver a subsequent notice or notices to the Trustee
that the Company is reducing the amount of Acquisition Debt specified
in a prior notice or notices to the Trustee pursuant to clause (a) of
this clause (xiii), in which case from and after the date of such later
notice, only the amount of Acquisition Debt specified in such later
notice shall be given effect pursuant to this clause (d) or incurred
pursuant to this clause (xiii).
For purposes of determining compliance with this Section 4.05, in the
event that an item of proposed Indebtedness meets the criteria of more than one
of the categories of Permitted Indebtedness described in clauses (i) through
(xiii) above, or is entitled to be incurred pursuant to the first paragraph of
this Section 4.05, the Company shall be permitted to classify such item of
Indebtedness on the date of its incurrence, or later reclassify all or a portion
of such item of Indebtedness, in any manner that complies with this Section
4.05. Accrual of interest, accretion or amortization of original issue discount,
the payments of dividends in kind and the accretion of accreted value shall not
be deemed to be an incurrence of Indebtedness for purposes of this Section 4.05.
Indebtedness under Credit Facilities outstanding on the date on which Notes are
first issued and authenticated under the Indenture shall be deemed to have been
incurred on such date in reliance on the exception provided by clause (i) of the
definition of Permitted Indebtedness.
Section 4.06. Asset Sales.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary to, consummate an Asset Sale unless:
(i) The Company or the Restricted Subsidiary, as the case
may be, receives consideration at the time of the Asset Sale at least
equal to the fair market value of the assets or Equity Interests issued
or sold or otherwise disposed of;
(ii) the fair market value is determined by the Board of
Directors and evidenced by a resolution of the Board of Directors set
forth in an Officers' Certificate delivered to the Trustee; and
(iii) at least 75% of the consideration received in the
Asset Sale by the Company or such Restricted Subsidiary is in the form
of cash or Cash Equivalents, except to the extent the Company is
undertaking a Permitted Asset Swap. For purposes of this provision and
the next paragraph, each of the following shall be deemed to be cash:
(A) any liabilities, as shown on the Company's or
such Restricted Subsidiary's most recent balance sheet, of the
Company or any Restricted Subsidiary (other than contingent
liabilities and liabilities that are by their terms
subordinated to the Notes or any Subsidiary Guarantee) that
are assumed by the transferee of any such assets and the
lender releases the Company or such Restricted Subsidiary from
further liability; and
(B) any securities, notes or other obligations
received by the Company or any such Restricted Subsidiary from
such transferee that are converted by the Company or such
Restricted Subsidiary within 90 days into cash or Cash
Equivalents, to the extent of the cash or Cash Equivalents
received in that conversion.
30
Notwithstanding the foregoing, the Company or any Restricted Subsidiary
shall be permitted to consummate an Asset Sale without complying with the
foregoing if:
(x) the Company or such Restricted Subsidiary receive
consideration at the time of such Asset Sale at least equal to the fair
market value of the assets or other property sold, issued or otherwise
disposed of:
(y) the fair market value is determined by the Board
of Directors and evidenced by a resolution of the Board of
Directors set forth in an Officers' Certificate delivered to the
Trustee; and
(z) at least 75% of the consideration for such Asset Sale
constitutes a majority of the Voting Stock of a Permitted Business,
assets used or useful in a Permitted Business and/or cash;
provided that any cash (other than any amount deemed cash under clause (iii)(A)
of the preceding paragraph) received by the Company or such Restricted
Subsidiary in connection with any Asset Sale permitted to be consummated under
this paragraph shall constitute Net Proceeds subject to the provisions of the
following paragraph.
(b) Within 365 days after the receipt of any Net Proceeds from an
Asset Sale, provided that (1) such Net Proceeds either singularly or when
aggregated with all other Net Proceeds from all Asset Sales consummated since
the date of this First Supplemental Indenture exceed $10.0 million, the Company
or such Restricted Subsidiary may apply those Net Proceeds at its option:
(i) to repay Senior Indebtedness and, if the Senior
Indebtedness repaid is revolving credit Indebtedness, to
correspondingly reduce commitments with respect thereto;
(ii) to acquire (or enter into a binding agreement to
acquire, provided that such commitment shall be subject only to
customary conditions and such acquisition shall be consummated within
180 days after the end of such 365-day period) all or substantially
all of the assets of, or a majority of the Voting Stock of, another
Permitted Business, or the minority interest in a Restricted
Subsidiary other than a Subsidiary Guarantor;
(iii) to make capital expenditures; or
(iv) to acquire (or enter into a binding agreement to
acquire, provided that such commitment shall be subject only to
customary conditions and such acquisition shall be consummated within
180 days after the end of such 365-day period) other assets that are
used or useful in a Permitted Business.
Pending the final application of any Net Proceeds, the Company may
temporarily reduce revolving credit borrowings or otherwise invest the Net
Proceeds in any manner that is not prohibited by the Indenture.
Any Net Proceeds from Asset Sales that are not applied or invested as
provided in the preceding paragraph shall constitute "Excess Proceeds." When the
aggregate amount of Excess Proceeds exceeds $10.0 million, the Company shall
make an Asset Sale Offer to all Holders of Notes and all holders of other
Indebtedness that is pari passu with the Notes containing provisions similar to
those set forth in the Indenture with respect to offers to purchase or redeem
with the proceeds of sales of assets to purchase the maximum principal amount of
Notes and such other pari passu Indebtedness that may be purchased out of the
Excess Proceeds. The offer price in any Asset Sale Offer shall be equal to 100%
of principal amount plus accrued and unpaid interest to the date of purchase,
and shall be payable in cash. If any
31
Excess Proceeds remain after consummation of an Asset Sale Offer, the Company
may use those Excess Proceeds for any purpose not otherwise prohibited by the
Indenture. If the aggregate principal amount of Notes and other pari passu
Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes and such other pari passu
Indebtedness to be purchased on a pro rata basis. Upon completion of each Asset
Sale Offer, the amount of Excess Proceeds shall be reset at zero.
(c) The Company shall comply with the requirements of Rule 14e-1 under
the Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with each
repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the
provisions of any securities laws or regulations conflict with the Asset Sale
provisions of this First Supplemental Indenture, the Company shall comply with
the applicable securities laws and regulations and will not be deemed to have
breached its obligations under the Asset Sale provisions of this First
Supplemental Indenture by virtue of such conflict.
Section 4.07. Transactions with Affiliates.
The Company shall not, and shall not permit any Restricted Subsidiary
to, make any payment to, or sell, lease, transfer or otherwise dispose of any of
its properties or assets to, or purchase any property or assets from, or enter
into or make or amend any transaction, contract, agreement, understanding, loan,
advance or guarantee with, or for the benefit of, any Affiliate (each, an
"Affiliate Transaction"), unless:
(a) the Affiliate Transaction is on terms that are no less favorable
to the Company or the relevant Restricted Subsidiary than those that would have
been obtained in a comparable transaction by the Company or such Restricted
Subsidiary with an unrelated Person; and
(b) the Company delivers to the Trustee:
(i) with respect to any Affiliate Transaction or series
of related Affiliate Transactions involving aggregate consideration in
excess of $2.0 million, a resolution of the Board of Directors set
forth in an Officers' Certificate certifying that such Affiliate
Transaction complies with this Section 4.07 and that such Affiliate
Transaction has been approved by a majority of the disinterested
members of the Board of Directors; and
(ii) with respect to any Affiliate Transaction or series
of related Affiliate Transactions involving aggregate consideration in
excess of $10.0 million, an opinion as to the fairness to the Company
of such Affiliate Transaction from a financial point of view issued by
an accounting, appraisal or investment banking firm of national
standing.
The following items shall not be deemed to be Affiliate Transactions
and, therefore, shall not be subject to the provisions of the prior paragraph:
(a) any employment agreement entered into by the Company or any
Restricted Subsidiary in the ordinary course of business and consistent with the
past practice of the Company or such Restricted Subsidiary;
(b) transactions between or among the Company and/or its
Restricted Subsidiaries;
(c) loans, advances, payment of reasonable fees, indemnification
of directors, or similar arrangements to officers, directors, employees and
consultants who are not otherwise Affiliates of the Company;
32
(d) sales of Equity Interests (other than Disqualified Stock) to
Affiliates of the Company;
(e) agreements in effect at the date of this First Supplemental
Indenture or any amendment thereto so long as such amendment is no less
favorable to the Company or such Restricted Subsidiary in any material respect
that the original agreement as in effect on the date of this First Supplemental
Indenture;
(f) services to be provided to any Unrestricted Subsidiary of the
Company or any Restricted Subsidiary in the ordinary course of business, which
the Board of Directors has determined, pursuant to a resolution thereof, are
provided on terms at least as favorable to the Company and its Restricted
Subsidiaries as those that would have been obtained in a comparable transaction
with an unrelated Person; and
(g) Permitted Investments and Restricted Payments that are
permitted by the provisions of this First Supplemental Indenture described under
Section 4.03.
Section 4.08. Liens.
The Company shall not, and shall not permit any Subsidiary Guarantor
to, directly or indirectly, create, incur, assume or suffer to exist any Lien of
any kind on any asset now owned or hereafter acquired of the Company or such
Subsidiary Guarantor securing Indebtedness ranking pari passu with, or junior to
the Notes or the Subsidiary Guarantees (other than Permitted Liens), unless all
Obligations in respect of the Notes, the Subsidiary Guarantees and this First
Supplemental Indenture are secured on an equal and ratable basis with (if such
secured Indebtedness is pari passu with the Notes or the Subsidiary Guarantee,
as the case may be; and otherwise on a senior basis to) the Indebtedness so
secured until such Indebtedness is no longer secured by a Lien.
Section 4.09. Offer to Repurchase Upon Change of Control.
(a) Upon the occurrence of a Change of Control, the Company shall make
an offer (a "Change of Control Offer") to each Holder to repurchase all or any
part (equal to $1,000 or an integral multiple thereof) of each Holder's Notes at
a purchase price equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid interest to the date of purchase ( the "Change of Control
Payment"). Within 10 business days following any Change of Control, the Company
shall mail a notice to each Holder stating: (1) that the Change of Control Offer
is being made pursuant to this Section 4.09 and that all Notes tendered will be
accepted for payment; (2) the purchase price and the purchase date, which shall
be no earlier than 30 days and no later than 60 days from the date such notice
is mailed (the "Change of Control Payment Date"); (3) that any Note not tendered
will continue to accrue interest; (4) that, unless the Company defaults in the
payment of the Change of Control Payment, all Notes accepted for payment
pursuant to the Change of Control Offer shall cease to accrue interest after the
Change of Control Payment Date; (5) that Holders electing to have any Notes
purchased pursuant to a Change of Control Offer will be required to surrender
the Notes, with the form entitled "Option of Holder to Elect Purchase" on the
reverse of the Notes completed, to the Paying Agent at the address specified in
the notice prior to the close of business on the third Business Day preceding
the Change of Control Payment Date; (6) that Holders will be entitled to
withdraw their election if the Paying Agent receives, not later than the close
of business on the second Business Day preceding the Change of Control Payment
Date, a telegram, telex, facsimile transmission or letter setting forth the name
of the Holder, the principal amount of Notes delivered for purchase, and a
statement that such Holder is withdrawing his election to have the Notes
purchased; and (7) that Holders whose Notes are being purchased only in part
will be issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered, which unpurchased portion must be equal to $1,000 in
principal amount or an integral multiple thereof. The Company shall comply with
the requirements of Rule 14e-1 under the Exchange Act and any other securities
laws and
33
regulations thereunder to the extent such laws and regulations are applicable in
connection with the repurchase of Notes in connection with a Change of Control.
(b) On the Change of Control Payment Date, the Company shall, to the
extent lawful, (1) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer, (2) deposit with the Paying
Agent an amount equal to the Change of Control Payment in respect of all Notes
or portions thereof properly tendered and (3) deliver or cause to be delivered
to the Trustee the Notes properly accepted together with an Officers'
Certificate stating the aggregate principal amount of Notes or portions thereof
being purchased by the Company. The Paying Agent shall promptly mail to each
Holder of Notes properly tendered and accepted the Change of Control Payment for
such Notes, and the Trustee shall promptly authenticate and mail (or cause to be
transferred by book entry) to each Holder a new Note equal in principal amount
to any unpurchased portion of the Notes surrendered, if any; provided that each
new Note shall be in a principal amount of $1,000 or an integral multiple
thereof.
(c) Prior to complying with any of the provisions of this Section
4.09, but in any event within 90 days following a Change of Control, the Company
will either pay all outstanding Senior Indebtedness or obtain the requisite
consents, if any, under all the agreements governing outstanding Senior
Indebtedness to permit the repurchase of the Notes required by this covenant.
The Company will publicly announce the results of the Change of Control Offer on
or as soon as practicable after the Change of Control Payment Date.
(d) Notwithstanding anything to the contrary in this Section 4.09, the
Company shall not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at the
times and otherwise in compliance with the requirements set forth in this
Section 4.09 and Section 3.03 hereof and all other provisions of the Indenture
applicable to a Change of Control Offer made by the Company and purchases all
Notes properly tendered and not withdrawn under the Change of Control Offer.
Section 4.10. No Senior Subordinated Debt.
The Company shall not incur, create, issue, assume, guarantee, or
otherwise become liable for any Indebtedness that is subordinate or junior in
right of payment to any Senior Indebtedness of the Company and senior in any
respect in right of payment to the Notes. No Subsidiary Guarantor shall incur,
create, issue, assume, guarantee or otherwise become liable for any Indebtedness
that is subordinated or junior in right of payment to the Senior Indebtedness of
such Guarantor and senior in any respect in right of payment to such Guarantor's
Subsidiary Guarantee.
Section 4.11. Additional Subsidiary Guarantees.
If the Company or any of its Restricted Subsidiaries acquires or
creates another Domestic Subsidiary after the date of this First Supplemental
Indenture, excluding all Subsidiaries that have been properly designated as
Unrestricted Subsidiaries in accordance with this First Supplemental Indenture
for so long as they continue to constitute Unrestricted Subsidiaries, then that
newly acquired or created Domestic Subsidiary shall become a Subsidiary
Guarantor and execute a supplemental Indenture and deliver an opinion of counsel
satisfactory to the Trustee within 10 Business Days of the date on which it was
acquired or created; provided, however, that if a Subsidiary of the Company that
is not a Guarantor guarantees the Indebtedness of the Company or a Subsidiary
Guarantor, such guarantee may be on a senior basis if the Indebtedness being
guaranteed is Senior Indebtedness, but otherwise shall be pari passu with any
Indebtedness being guaranteed that is pari passu with the Notes, or shall be on
a subordinated basis if the Indebtedness being guaranteed is subordinated to the
Notes, in which event such guarantee shall be subordinated at least to the same
extent the Indebtedness being guaranteed is subordinated to the Notes.
34
Section 4.12. Limitation on Issuances of Equity Interests in Wholly Owned
Subsidiaries.
The Company (i) shall not, and shall not permit any of its Restricted
Subsidiaries to, transfer, convey, sell, lease or otherwise dispose of any
Equity Interest in any Wholly Owned Subsidiaries of the Company to any Person
(other than the Company or a Wholly Owned Restricted Subsidiary of the Company),
unless (a) as a result of such transfer, conveyance, sale, lease or other
disposition or issuance such Restricted Subsidiary no longer constitutes a
Subsidiary and (b) the cash Net Proceeds from such transfer, conveyance, sale,
lease or other disposition are applied in accordance with Section 4.06 hereof
and (ii) shall not permit any Restricted Subsidiary to issue any of its Equity
Interests (other than, if necessary, shares of its Capital Stock constituting
directors' qualifying shares) to any Person other than to the Company or a
Wholly Owned Restricted Subsidiary of the Company.
Section 4.13. Payments for Consent.
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, pay or cause to be paid any consideration to or for the
benefit of any Holder of Notes for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this First Supplemental Indenture
or the Notes unless such consideration is offered to be paid and is paid to all
Holders of the Notes that consent, waive or agree to amend in the time frame set
forth in the solicitation documents relating to such consent, waiver or
agreement.
Section 4.14. Designation of Restricted and Unrestricted Subsidiaries.
The Board of Directors may designate any Restricted Subsidiary (or any
Person that upon its acquisition otherwise would become a Restricted Subsidiary)
to be an Unrestricted Subsidiary if that designation would not cause a Default
or Event of Default. If a Restricted Subsidiary is designated as an Unrestricted
Subsidiary, the aggregate fair market value of all outstanding Investments owned
by the Company and the Restricted Subsidiaries in the Subsidiary properly
designated will be deemed to be an Investment made as of the time of the
designation and will reduce the amount available for Restricted Payments under
the first paragraph of Section 4.03 hereof or Permitted Investments, as
determined by the Company. That designation will only be permitted if the
Investment would be permitted at that time and if the Restricted Subsidiary
otherwise meets the definition of an Unrestricted Subsidiary. The Board of
Directors may redesignate any Unrestricted Subsidiary to be a Restricted
Subsidiary if the redesignation would not cause a Default or Event of Default.
ARTICLE 5.
SUCCESSORS
Pursuant to Section 2.01(r) of the Base Indenture, so long as any of
the Notes are outstanding, the following provision shall supercede and replace
in its entirety Section 5.01 of the Base Indenture with respect to the Notes:
Section 5.01. Merger, Consolidation, or Sale of Assets.
An Issuer shall not, directly or indirectly: (1) consolidate or merge
with or into another Person (whether or not such Issuer is the surviving
Person); or (2) sell, assign, transfer, convey or otherwise dispose of all or
substantially all of the properties or assets of such Issuer and its Restricted
Subsidiaries taken as a whole, in one or more related transactions, to another
Person; unless:
(i) either: (x) such Issuer is the surviving Person; or
(y) the Person formed by or surviving any such consolidation or merger
(if other than such Issuer) or to which such sale, assignment,
transfer, conveyance or other disposition has been made is an entity
organized or
35
existing under the laws of the United States, any state of the United
States or the District of Columbia;
(ii) the Person formed by or surviving any such
consolidation or merger (if other than such Issuer) or the Person to
which such sale, assignment, transfer, conveyance or other disposition
has been made assumes all of the obligations of such Issuer under the
Notes and this First Supplemental Indenture pursuant to a supplemental
indenture reasonably satisfactory to the Trustee;
(iii) immediately after such transaction no Default or
Event of Default exists; and
(iv) such Issuer or the Person formed by or surviving
any such consolidation or merger (if other than such Issuer), or to
which such sale, assignment, transfer, conveyance or other disposition
has been made (x) shall, on the date of such transaction after giving
pro forma effect thereto and any related financing transactions as if
the same had occurred at the beginning of the applicable four-quarter
period, be permitted to incur at least $1.00 of additional
Indebtedness pursuant to the Leverage Ratio test set forth in the
first paragraph of Section 4.05, or (y) would have a lower Leverage
Ratio immediately after the transaction, after giving pro forma effect
to the transaction as if the transaction had occurred at the beginning
of the applicable four quarter period, than the Company's Leverage
Ratio immediately prior to the transaction.
The preceding clause (iv) shall not prohibit: (x) a merger between an
Issuer and one of such Issuer's Wholly Owned Restricted Subsidiaries; or (y) a
merger between an Issuer and one of such Issuer's Affiliates incorporated solely
for the purpose of reincorporating in another state of the United States.
In addition, an Issuer shall not, directly or indirectly, lease all or
substantially all of its properties or assets, in one or more related
transactions, to any other Person. The provisions of this Section 5.01 shall not
apply to a sale, assignment, transfer, conveyance or other disposition of assets
between or among an Issuer and any of its Wholly Owned Restricted Subsidiaries.
ARTICLE 6.
DEFAULTS AND REMEDIES
Pursuant to Section 2.01(m) of the Base Indenture, so long as any Notes
are outstanding, the following provisions shall supercede and replace in their
entirety Sections 6.01 and 6.02 of the Base Indenture with respect to the Notes;
provided that, for purposes of the Notes, references in Section 6.08 of the Base
Indenture to Section 6.01(1) and 6.01(2) thereof shall be deemed to refer to
Sections 6.01(a) and 6.01(b), respectively, of this First Supplemental Indenture
and references in Section 7.07 of the Base Indenture to Section 6.01(4) and
6.01(5) thereof shall be deemed to refer to Sections 6.01(h) and 6.01(i),
respectively, of this First Supplemental Indenture.
Section 6.01. Events of Default.
An "Event of Default" occurs if:
(a) the Company defaults in the payment when due of interest on
the Notes and such default continues for a period of 30 days;
(b) the Company defaults in the payment when due of principal of or
premium, if any, on the Notes (whether or not prohibited by the subordination
provisions of the Indenture) when the same
36
becomes due and payable at maturity, upon redemption (including in connection
with an offer to purchase) or otherwise;
(c) the Company or any Restricted Subsidiary fails to comply with
any of the provisions of Section 4.09 hereof;
(d) the Company or any Restricted Subsidiary fails to comply with
any of the provisions of Section 4.03, 4.05, 4.06 or 5.01 hereof for 30
days;
(e) the Company or any Restricted Subsidiary fails to observe or
perform any other covenant, representation, warranty or other agreement in the
Indenture for 60 days after notice to the Company by the Trustee or the Holders
of at least 25% in aggregate principal amount of the Notes (including Additional
Notes, if any) then outstanding voting as a single class;
(f) a default occurs under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any of the Restricted
Subsidiaries (or the payment of which is guaranteed by the Company or any of the
Restricted Subsidiaries), whether such Indebtedness or Guarantee now exists, or
is created after the date hereof, which default (i) is caused by a failure to
pay principal of such Indebtedness at the final Stated Maturity thereof (a
"Payment Default") or (ii) results in the acceleration of such Indebtedness
prior to its express maturity and, in each case, the principal amount of such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates $15.0 million or more;
(g) a final judgment or final judgments for the payment of money are
entered by a court or courts of competent jurisdiction against the Company or
any of its Significant Subsidiaries or any group of Subsidiaries that, taken as
a whole, would constitute a Significant Subsidiary and such judgment or
judgments remain undischarged for a period (during which execution shall not be
effectively stayed) of 60 days, provided that the aggregate of all such
undischarged judgments exceeds $10.0 million;
(h) the Company or any of its Significant Subsidiaries or any group
of Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary pursuant to or within the meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against
it in an involuntary case,
(iii) consents to the appointment of a custodian of it or
for all or substantially all of its property,
(iv) makes a general assignment for the benefit of its
creditors, or
(v) generally is not paying its debts as they become
due; or
(i) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(i) is for relief against the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that, taken
as a whole, would constitute a Significant Subsidiary in an
involuntary case;
(ii) appoints a custodian of the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary or for all or
37
substantially all of the property of the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary; or
(iii) orders the liquidation of the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 consecutive days;
or
(j) except as permitted by the Indenture, any Subsidiary Guarantee of a
Significant Subsidiary is held in any judicial proceeding to be unenforceable or
invalid or shall cease for any reason to be in full force and effect or any
Significant Subsidiary that is a Guarantor, or any Person acting on behalf of
any such Guarantor, shall deny or disaffirm its obligations under such
Guarantor's Subsidiary Guarantee.
Section 6.02. Acceleration.
If any Event of Default (other than an Event of Default specified in
clause (h) or (i) of Section 6.01 hereof with respect to the Company, any
Significant Subsidiary or any group of Significant Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary) occurs and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the then
outstanding Notes may declare all the Notes to be due and payable immediately;
provided, however, that until the Credit Agreement has been paid in full in
cash, no principal or accrued interest under the Notes shall become due and
payable until the earlier of (a) the date on which the Indebtedness under the
Credit Agreement shall been declared, or shall become or be, due and payable or
(b) the day that is five Business Days after the date on which the agent(s)
under the Credit Agreement is given written notice in accordance with the
provisions of the Credit Agreement of such declaration of acceleration of the
Notes. Upon any such declaration, the Notes shall become due and payable
immediately. Notwithstanding the foregoing, if an Event of Default specified in
clause (h) or (i) of Section 6.01 hereof occurs with respect to the Company, any
of its Significant Subsidiaries or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary, all outstanding Notes shall be
due and payable immediately without further action or notice. The Holders of a
majority in aggregate principal amount of the then outstanding Notes by written
notice to the Trustee may on behalf of all of the Holders rescind an
acceleration and its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default (except nonpayment of
principal, interest or premium that has become due solely because of the
acceleration) have been cured or waived.
In the event of a declaration of acceleration of the Notes because an
Event of Default has occurred and is continuing as a result of the acceleration
of any Indebtedness described in clause (f) of Section 6.01 hereof, the
declaration of acceleration of the Notes shall be automatically annulled if the
holders of any Indebtedness described in clause (f) of Section 6.01 hereof have
rescinded the declaration of acceleration in respect of the Indebtedness and if
(i) the annulment of the acceleration of Notes would not conflict with any
judgment or decree of a court of competent jurisdiction; and (ii) all existing
Events of Default, except nonpayment of principal or interest on the Notes that
became due solely because of the acceleration of the Notes, have been cured or
waived.
If an Event of Default occurs on or after March 1, 2007 by reason of
any willful action (or inaction) taken (or not taken) by or on behalf of the
Company with the intention of avoiding payment of the premium that the Company
would have been required to pay if the Company then had elected to redeem the
Notes pursuant to Section 3.01 hereof, then, upon acceleration of the Notes, an
equivalent premium shall also become and be immediately due and payable, to the
extent permitted by law, anything in the Indenture or in the Notes to the
contrary notwithstanding. If an Event of Default occurs prior to March 1, 2007
by reason of any willful action (or inaction) taken (or not taken) by or on
behalf of the Company with the intention of avoiding the prohibition on
redemption of the Notes prior to such date,
38
then, upon acceleration of the Notes, an additional premium shall also become
and be immediately due and payable in an amount, for each of the years beginning
on of the years set forth below, as set forth below (expressed as a percentage
of the principal amount of the Notes on the date of payment that would otherwise
be due but for the provisions of this sentence):
Year Percentage
- ---- ----------
2003........................................................... 107.625%
2004........................................................... 106.672%
2005........................................................... 105.719%
2006 and thereafter............................................ 104.766%
Notwithstanding any provision to the contrary herein, the Trustee shall not be
obligated to take any action with respect to the provisions of this paragraph
unless directed to do so pursuant to Section 6.05 of the Base Indenture.
ARTICLE 7.
AMENDMENT, SUPPLEMENT AND WAIVER
Pursuant to Section 2.01(r) of the Base Indenture, so long as any Notes
are outstanding, the following provisions shall supercede and replace Sections
9.01 and 9.02 of the Base Indenture with respect to the Notes:
Section 7.01. Without Consent of Holders of Notes.
Notwithstanding Section 7.02 of this First Supplemental Indenture, but
subject to the provisions of Article 8 hereof, the Company, the Guarantors and
the Trustee may amend or supplement this First Supplemental Indenture , the
Subsidiary Guarantees or the Notes without the consent of any Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes or to alter the provisions of Article 2 hereof (including the
related definitions) in a manner that does not materially adversely affect any
Holder;
(c) to provide for the assumption of the Company's or a Guarantor's
obligations to the Holders of the Notes by a successor to the Company pursuant
to Article 5 of the Base Indenture or Article 9 of this First Supplemental
Indenture;
(d) to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the legal
rights hereunder of any such Holder;
(e) to comply with requirements of the SEC in order to effect or
maintain the qualification of the Indenture under the TIA;
(f) to provide for the issuance of Additional Notes in accordance
with the limitations set forth in the Indenture as of the date hereof; or
(g) to allow any Guarantor to execute a supplemental indenture and/or
a Guarantee with respect to the Notes.
39
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
7.02 of the Base Indenture, the Trustee shall join with the Company and the
Guarantors in the execution of any amended or supplemental Indenture authorized
or permitted by the terms of the Indenture and to make any further appropriate
agreements and stipulations that may be therein contained, but the Trustee shall
not be obligated to enter into such amended or supplemental Indenture that
affects its own rights, duties or immunities under the Indenture or otherwise.
Section 7.02. With Consent of Holders of Notes.
Except as provided below in this Section 7.02, but subject to the
provisions of Article 8 hereof, the Company and the Trustee may amend or
supplement the Indenture (including Section 3.03, 4.06 and 4.09 hereof), the
Subsidiary Guarantees and the Notes with the consent of the Holders of at least
a majority in principal amount of the Notes (including Additional Notes, if any)
then outstanding voting as a single class (including consents obtained in
connection with a tender offer or exchange offer for, or purchase of, the
Notes), and, subject to Sections 6.04 and 6.07 of the Base Indenture and Article
8 hereof, any existing Default or Event of Default (other than a Default or
Event of Default in the payment of the principal of, premium, if any, or
interest on the Notes, except a payment default resulting from an acceleration
that has been rescinded) or compliance with any provision of the Indenture, the
Subsidiary Guarantees or the Notes may be waived with the consent of the Holders
of a majority in principal amount of the then outstanding Notes (including
Additional Notes, if any) voting as a single class (including consents obtained
in connection with a tender offer or exchange offer for, or purchase of, the
Notes).
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by
the Trustee of the documents described in Section 7.02 of the Base Indenture,
the Trustee shall join with the Company in the execution of such amended or
supplemental indenture unless such amended or supplemental indenture directly
affects the Trustee's own rights, duties or immunities under the Indenture or
otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes under
this Section 7.02 to approve the particular form of any proposed amendment or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
Indenture or waiver. The Holders of a majority in aggregate principal amount of
the Notes (including Additional Notes, if any) then outstanding voting as a
single class may waive compliance in a particular instance by the Company with
any provision of the Indenture or the Notes. However, without the consent of
each Holder affected, an amendment or waiver under this Section 7.02 may not
(with respect to any Notes held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must consent to
an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any Note
or alter or waive any of the provisions with respect to the redemption of the
Notes except as provided above with respect to Sections 3.03, 4.06 and 4.09
hereof;
40
(c) reduce the rate of or change the time for payment of interest,
including default interest, on any Note;
(d) waive a Default or Event of Default in the payment of
principal of or premium, if any, or interest on the Notes (except a rescission
of acceleration of the Notes by the Holders of at least a majority in aggregate
principal amount of the then outstanding Notes (including Additional Notes, if
any) and a waiver of the payment default that resulted from such acceleration);
(e) make any Note payable in money other than that stated in the
Notes;
(f) make any change in the provisions of the Indenture relating to
waivers of past Defaults or the rights of Holders of Notes to receive payments
of principal of or interest or premium on the Notes;
(g) waive a redemption payment with respect to any Note except
as provided above with respect to Sections 3.03, 4.06 and 4.09 hereof;
(h) make any change in the foregoing amendment and waiver
provisions; or
(i) amend or waive the provisions of Article Eight of this
First Supplemental Indenture in a manner that adversely affects the rights of
the Holders of the Notes; or
(j) release any Guarantor from any of its obligations under
its Guarantee or the Indenture, except in accordance with the terms of the
Indenture.
Section 7.03. Compliance with Trust Indenture Act.
Every amendment or supplement to this First Supplemental Indenture or
the Notes shall be set forth in a amended or supplemental Indenture that
complies with the TIA as then in effect.
ARTICLE 8.
SUBORDINATION
Pursuant to Section 2.01(u) of the Base Indenture, so long as any Notes
are outstanding, the following provisions shall be applicable with respect to
the Notes:
Section 8.01. Agreement to Subordinate.
The Company agrees, and each Holder by accepting a Note agrees, that
the principal, interest, premium on and all other Obligations arising under the
Notes or this Indenture are subordinated in right of payment, to the extent and
in the manner provided in this Article Eight, to the prior payment in full in
cash of all Senior Indebtedness (whether outstanding on the date hereof or
hereafter created, incurred, assumed or guaranteed), and that the subordination
is for the benefit of and enforceable by the holders of Senior Indebtedness.
Section 8.02. Liquidation; Dissolution; Bankruptcy.
Upon any distribution to creditors of the Company in a liquidation or
dissolution of the Company or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the Company or its property, in
an assignment for the benefit of creditors or in any marshaling of the Company's
assets and liabilities:
41
(i) holders of Senior Indebtedness shall be entitled
to receive payment in full in cash of all Obligations due in respect
of such Senior Indebtedness (including interest after the commencement
of any such proceeding at the rate and on the terms specified in the
applicable Senior Indebtedness whether or not a claim for such
interest would be allowed in such proceeding) before Holders of the
Notes shall be entitled to receive any payment or distribution of any
assets or securities with respect to the Notes or on account of any
purchase or redemption or other acquisition of any Note (except that
Holders may receive and retain (A) Permitted Junior Securities and (B)
payments and other distributions made from any defeasance trust
created pursuant to Section 8.06 of the Base Indenture so long as, on
the date or dates the respective amounts were paid into trust, such
payments were made without violating the provisions set forth in this
Article Eight); and
(ii) until all Obligations with respect to Senior
Indebtedness (as provided in clause (i) above) are paid in full in
cash, any payment or distribution to which Holders would be entitled
but for this Article Eight shall be made to holders of Senior
Indebtedness (except that Holders of Notes may receive and retain (A)
Permitted Junior Securities and (B) payments and other distributions
made from any defeasance trust created pursuant to Section 8.06 of the
Base Indenture so long as, on the date or dates the respective amounts
were paid into trust, such payments were made without violating the
provisions set forth in this Article Eight), as their interests may
appear.
Section 8.03. Default on Designated Senior Indebtedness.
(a) Neither the Company nor any Guarantor may make any payment or
distribution of any assets or securities to the Trustee or any Holder in respect
of the Notes or any applicable Guarantee in respect thereof and may not acquire,
redeem or purchase from the Trustee or any Holder any Notes for cash or property
(other than (A) Permitted Junior Securities and (B) payments and other
distributions made from any defeasance trust created pursuant to Section 8.06 of
the Base Indenture so long as, on the date or dates the respective amounts were
paid into trust, such payments were made without violating the provisions set
forth in this Article Eight) until all principal and other Obligations with
respect to the Designated Senior Indebtedness have been paid in full in cash if:
(i) a default in the payment of any principal of, or
premium, if any, or interest on or any fees or other Obligations with
respect to Designated Senior Indebtedness occurs and is continuing (a
"payment default"); or
(ii) any other default, other than a payment default (a
"nonpayment default"), on any series of Designated Senior Indebtedness
occurs and is continuing that permits holders of that series of
Designated Senior Indebtedness to accelerate its maturity and the
Trustee receives a notice in writing of the default (a "Payment
Blockage Notice") from the holders of any Designated Senior
Indebtedness or their Representative.
If the Trustee receives any such Payment Blockage Notice, no
subsequent Payment Blockage Notice shall be effective for purposes of this
Section unless and until at least 360 days shall have elapsed since the delivery
of the immediately prior Payment Blockage Notice. No nonpayment default that
existed or was continuing on the date of delivery of any Payment Blockage Notice
to the Trustee shall be, or be made, the basis for a subsequent Payment Blockage
Notice unless such default has been cured or waived for a period of not less
than 90 consecutive days.
(b) The Company may and shall resume payments on and distributions in
respect of the Notes and may acquire them:
42
(i) in the case of a payment default, upon the date which
the default is cured or waived in writing by the holders of Designated
Senior Indebtedness or a representative on their behalf, or
(ii) in the case of a nonpayment default, the earlier of:
(A) the date on which such nonpayment default is cured or waived in
writing by holders of Designated Senior Indebtedness or a
representative on their behalf, (B) 179 days after the applicable
Payment Blockage Notice is received by the Trustee, or (C) the date on
which the trustee receives notice in writing from or on behalf of the
holders of Designated Senior Indebtedness to terminate the applicable
Payment Blockage Notice, unless in any case, the maturity of any such
Designated Senior Indebtedness has been accelerated,
if this Article Eight otherwise permits the payment, distribution or acquisition
at the time of such payment, distribution or acquisition.
Section 8.04. Acceleration of Notes.
If payment of the Notes is accelerated because of an Event of Default,
the Company shall promptly notify holders of Senior Indebtedness of the
acceleration.
Section 8.05. When Distribution Must Be Paid Over.
In the event that the Trustee or any Holder receives any payment or
distribution with respect to the Notes (except (A) in Permitted Junior
Securities or (B) from payments and other distributions made from any defeasance
trust created pursuant to Section 8.06 of the Base Indenture so long as on the
date or dates the respective amounts were paid into trust, such payments were
made without violating the provisions set forth in this Article Eight) at a time
when such payment or distribution is prohibited by Section 8.02 or 8.03 hereof,
such payment or distribution shall be held by the Trustee or such Holder, in
trust for the benefit of the holders of Senior Indebtedness, and shall be paid
over and delivered, with any necessary endorsement, upon written request of the
holders of Senior Indebtedness, to the holders of Senior Indebtedness as their
interests may appear or their Representative under this First Supplemental
Indenture or other agreement (if any) pursuant to which Senior Indebtedness may
have been issued, as their respective interests may appear, for application to
the payment of all Obligations with respect to Senior Indebtedness remaining
unpaid to the extent necessary to pay such Obligations in full in cash in
accordance with their terms, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness.
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform only such obligations on the part of the Trustee as are
specifically set forth in this Article Eight, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this First Supplemental Indenture against the Trustee. The Trustee shall
not be deemed to owe any fiduciary duty to the holders of Senior Indebtedness,
and shall not be liable to any such holders if the Trustee shall pay over or
distribute to or on behalf of Holders or the Company money or assets to which
any holders of Senior Indebtedness shall be entitled by virtue of this Article
Eight, except if such payment is made as a result of the willful misconduct or
gross negligence of the Trustee.
Section 8.06. Notice by Company.
The Company shall promptly notify the Trustee and the Paying Agent of
any facts known to the Company that would cause a payment of any Obligations
with respect to the Notes to violate this Article Eight, but failure to give
such notice shall not affect the subordination of the Notes to the Senior
Indebtedness or the rights of holders of Senior Indebtedness as provided in this
Article Eight.
43
Section 8.07. Subrogation.
No payment or distribution to any holder of Senior Indebtedness
pursuant to this Article 8 shall entitle any holder of Notes to exercise any
rights of subrogation in respect thereof until the Senior Indebtedness shall
have been paid in full in cash. After all Senior Indebtedness is paid in full in
cash and until the Notes are paid in full in cash, Holders of Notes shall be
subrogated (equally and ratably with all other Indebtedness pari passu with the
Notes) to the rights of holders of Senior Indebtedness to receive distributions
applicable to Senior Indebtedness to the extent that distributions otherwise
payable to the Holders of Notes have been applied to the payment of Senior
Indebtedness. A distribution made under this Article Eight to holders of Senior
Indebtedness that otherwise would have been made to Holders of Notes is not, as
between the Company and Holders, a payment by the Company on the Notes.
Section 8.08. Relative Rights.
This Article Eight defines the relative rights of Holders of Notes and
holders of Senior Indebtedness. Nothing in this First Supplemental Indenture
shall:
(i) impair, as between the Company and Holders of Notes,
the obligation of the Company, which is absolute and unconditional, to
pay principal of and interest on the Notes in accordance with their
terms;
(ii) affect the relative rights of Holders of Notes and
creditors of the Company other than their rights in relation to
holders of Senior Indebtedness; or
(iii) prevent the Trustee or any Holder of Notes from
exercising its available remedies upon a Default or Event of Default,
subject to the rights of holders and owners of Senior Indebtedness to
receive distributions and payments otherwise payable to Holders of
Notes.
If the Company fails because of this Article Eight to pay principal of
or interest on a Note on the due date, the failure is still a Default or Event
of Default.
Section 8.09. Subordination May Not Be Impaired by Company or any Guarantor.
No right of any holder of Senior Indebtedness to enforce the
subordination of the Indebtedness evidenced by the Notes shall be impaired by
any act or failure to act by the Company or any Guarantor or any Holder or by
the failure of the Company or any Guarantor or any Holder to comply with this
First Supplemental Indenture or any Note or any Guarantee regardless of any
knowledge thereof that any holder of Senior Indebtedness may have or otherwise
be charged with.
No exercise of, delay in exercising or failure to exercise any right
arising under this Article Eight, no act or omission of any holder of Senior
Indebtedness in respect of the Company or any of its Subsidiaries or any other
Person or any collateral security for any Senior Indebtedness or any right
arising under this Article Eight, no change, impairment, or suspension of any
right or remedy of any holder of any Senior Indebtedness, no other act, failure
to act, circumstance, occurrence or event which, but for this provision, would
or could act as a release or exoneration of the obligations of any Holder of
Notes under this Article Eight shall in any way affect, decrease, diminish or
impair any of the obligations of the holders of the Notes under this Article
Eight or give any Holder of the Notes any recourse or defense against any holder
of the Senior Indebtedness in respect of any right arising under this Article
Eight.
44
Section 8.10. Distribution or Notice to Representative.
Whenever a distribution is to be made or a notice given to holders of
Senior Indebtedness, the distribution may be made and the notice given to their
Representative.
Upon any payment or distribution of assets of the Company referred to
in this Article Eight, the Trustee and the Holders of Notes shall be entitled to
rely upon any order or decree made by any court of competent jurisdiction or
upon any certificate of such Representative or of the liquidating trustee or
agent or other Person making any distribution to the Trustee or to the Holders
of Notes for the purpose of ascertaining the Persons entitled to participate in
such distribution, the holders of the Senior Indebtedness and other Indebtedness
of the Company, the amount thereof or payable thereon, the amount or amounts
paid or distributed thereon and all other facts pertinent thereto or to this
Article Eight.
Section 8.11. Rights of Trustee and Paying Agent.
Notwithstanding the provisions of this Article Eight or any other
provision of this First Supplemental Indenture, the Trustee shall not be charged
with knowledge of the existence of any facts that would prohibit the making of
any payment or distribution by the Trustee, and the Trustee and the Paying Agent
may continue to make payments on the Notes, unless the Trustee shall have
received at its Corporate Trust Office at least two Business Days prior to the
date of such payment written notice of facts that would cause the payment of any
Obligations with respect to the Notes to violate this Article Eight. Only the
Company, the holders of Senior Indebtedness and their Representatives may give
such notice, provided that only the holders of Designated Senior Indebtedness or
their Representative may give a Payment Blockage Notice. Nothing in this Article
Eight shall impair the claims of, or payments to, the Trustee under or pursuant
to Section 7.07 of the Base Indenture.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights.
Section 8.12. Authorization to Effect Subordination.
Each Holder of Notes, by the Holder's acceptance thereof, authorizes
and directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article Eight, and appoints the Trustee to act as such Holder's attorney-in-fact
for any and all such purposes. If the Trustee does not file a proper proof of
claim or proof of debt in the form required in any proceeding referred to in
Section 6.09 of the Base Indenture at least 30 days before the expiration of the
time to file such claim, the Representatives are hereby authorized, but shall
not be obligated, to file an appropriate claim for and on behalf of the Holders
of the Notes.
Section 8.13. Amendments.
The provisions of this Indenture relating to subordination shall not be
amended, modified or waived in a manner adverse to the holders of Designated
Senior Indebtedness without the written consent of the holders of all Designated
Senior Indebtedness or their duly authorized representatives.
Section 8.14. Reinstatement of Payments.
This Article Eight shall remain in full force and effect until such
time as the Senior Indebtedness shall have been indefeasibly paid in full in
cash and the liability of the Trustee and the Noteholders under this Article
Eight shall be reinstated and revived, and the rights of the holders of Senior
Indebtedness shall continue, with respect to any amount at any time paid on
account of the Senior Indebtedness which shall thereafter be required to be
restored or returned by the holders of the Senior Indebtedness, whether
45
pursuant to any proceeding described in Sections 6.01(h) or (i),
pursuant to any fraudulent conveyance or fraudulent transfer statute
or otherwise, as though such amount had not been paid.
ARTICLE 9.
GUARANTEES
Pursuant to Section 2.01(v) of the Base Indenture, so long as any Notes
are outstanding, the following provisions shall be applicable with respect to
the Notes:
Section 9.01. Guarantee.
Subject to this Article Nine, each of the Guarantors hereby, jointly
and severally, unconditionally guarantees to each Holder of a Note authenticated
and delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of the Indenture, the Notes or
the obligations of the Company hereunder or thereunder, that: (a) the principal
of, premium, if any, and interest on the Notes will be promptly paid in full in
cash when due, whether at maturity, by acceleration, redemption or otherwise,
and interest on the overdue principal of and interest on the Notes, if any, if
lawful, and all other obligations of the Company to the Holders or the Trustee
hereunder or thereunder will be promptly paid in full or performed, all in
accordance with the terms hereof and thereof; and (b) in case of any extension
of time of payment or renewal of any Notes or any of such other obligations,
that same will be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at Stated Maturity, by
acceleration or otherwise. Failing payment when due of any amount so guaranteed
or any performance so guaranteed for whatever reason, the Guarantors shall be
jointly and severally obligated to pay the same immediately. Each Guarantor
agrees that this is a Guarantee of payment and not a Guarantee of collection.
The Guarantors hereby agree that their obligations hereunder shall be
unconditional, irrespective of the validity, regularity or enforceability of the
Notes or the Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Notes with respect to any provisions
hereof or thereof, the recovery of any judgment against the Company, any action
to enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a guarantor. Each Guarantor hereby
waives diligence, presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands whatsoever
and covenant that the Guarantee shall not be discharged except by complete
performance of the obligations contained in the Notes and the Indenture.
If any Holder or the Trustee is required by any court or otherwise to
return to the Company, the Guarantors or any custodian, trustee, liquidator or
other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, the
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect.
Each Guarantor agrees that it shall not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby. Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 of the
Indenture for the purposes of the Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (y) in the event of any declaration of
acceleration of such obligations as provided in Article 6 of the Indenture, such
obligations (whether or not due and payable) shall forthwith become due and
payable by the Guarantors for the purpose of the Guarantee. The Guarantors shall
have the right
46
to seek contribution from any non-paying Guarantor so long as the exercise of
such right does not impair the rights of the Holders under the Guarantee.
Section 9.02. Subordination of Guarantee.
The Obligations of each Guarantor under its Guarantee pursuant to this
Article Nine shall be junior and subordinated to Senior Indebtedness of such
Guarantor on the same basis as the Notes are junior and subordinated to Senior
Indebtedness of the Company provided that, with respect to the Parent Guarantor
only, the Guarantee shall be subordinated in accordance with the provisions of
the Existing Debentures Indenture. For the purposes of this Section 9.02, the
Trustee and the Holders shall have the right to receive and/or retain payments
by any of the Guarantors only at such times as they may receive and/or retain
payments in respect of the Notes pursuant to this First Supplemental Indenture.
Section 9.03. Limitation on Guarantor Liability.
Each Guarantor, and by its acceptance of Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Guarantee of such
Guarantor not constitute a fraudulent transfer or conveyance for purposes of
Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar federal or state law to the extent applicable to any
Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and
the Guarantors hereby irrevocably agree that the obligations of such Guarantor
will, after giving effect to such maximum amount and all other contingent and
fixed liabilities of such Guarantor that are relevant under such laws, and after
giving effect to any collections from, rights to receive contribution from or
payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under this Article Nine, result in the
obligations of such Guarantor under its Guarantee not constituting a fraudulent
transfer or conveyance.
Section 9.04. Execution and Delivery of Guarantee.
To evidence its Guarantee set forth in Section 9.01, each Guarantor
hereby agrees that a notation of such Guarantee substantially in the form
included in Exhibit C hereto shall be endorsed by an Officer of such Guarantor
on each Note authenticated and delivered by the Trustee and that this First
Supplemental Indenture shall be executed on behalf of such Guarantor by its
Officers.
Each Guarantor hereby agrees that its Guarantee set forth in Section
9.01 shall remain in full force and effect notwithstanding any failure to
endorse on each Note a notation of such Guarantee.
If an Officer whose signature is on this First Supplemental Indenture
or on the Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which a Guarantee is endorsed, the Guarantee shall be
valid nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Guarantee set forth in
this First Supplemental Indenture on behalf of the Guarantors.
In the event that the Company or any of its Restricted Subsidiaries
creates or acquires any new Domestic Subsidiaries subsequent to the date hereof,
if required by Section 4.11 of this First Supplemental Indenture, the Company
shall cause such Subsidiaries to execute supplemental indentures to this First
Supplemental Indenture and Subsidiary Guarantees in accordance with Section 4.11
of this First Supplemental Indenture and this Article Nine, to the extent
applicable.
47
Section 9.05. Subsidiary Guarantors May Consolidate, etc., on Certain Terms.
Except as otherwise provided in Section 9.06, no Subsidiary Guarantor
may sell or otherwise dispose of all or substantially all of its assets to, or
consolidate with or merge with or into (whether or not such Subsidiary Guarantor
is the surviving Person) another Person other than the Company, the Parent
Guarantor or another Subsidiary Guarantor unless:
(1) immediately after giving effect to such transaction, no Default or
Event of Default exists; and
(2) either
(a) subject to Section 9.06 hereof, the Person acquiring the property
in any such sale of disposition or the Person formed by or surviving
any such consolidation or merger (if other than a Guarantor or the
Company) unconditionally assumes all the obligations of such
Subsidiary Guarantor, pursuant to a supplemental indenture in form and
substance reasonably satisfactory to the Trustee, under the Notes,
this First Supplemental Indenture and the Guarantee on the terms set
forth herein or therein; or
(b) the Net Proceeds of such sale or other disposition are applied in
accordance with the applicable provisions of the Indenture, including,
without limitation, Section 4.11 of the Indenture.
In case of any such consolidation, merger, sale or conveyance and upon
the assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the
Guarantee endorsed upon the Notes and the due and punctual performance of all of
the covenants and conditions of the Indenture to be performed by the Guarantor,
such successor Person shall succeed to and be substituted for the Guarantor with
the same effect as if it had been named herein as a Guarantor. Such successor
Person thereupon may cause to be signed any or all of the Guarantees to be
endorsed upon all of the Notes issuable hereunder which theretofore shall not
have been signed by the Company and delivered to the Trustee. All the Guarantees
so issued shall in all respects have the same legal rank and benefit under this
First Supplemental Indenture as the Guarantees theretofore and thereafter issued
in accordance with the terms of this First Supplemental Indenture as though all
of such Guarantees had been issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 of the Indenture, and
notwithstanding clauses (a) and (b) above, nothing contained in this First
Supplemental Indenture or in any of the Notes shall prevent any consolidation or
merger of a Guarantor with or into the Company or another Guarantor, or shall
prevent any sale or conveyance of the property of a Guarantor as an entirety or
substantially as an entirety to the Company or another Guarantor.
Section 9.06. Releases Following Sale of Assets.
In the event of (a) any sale or other disposition of all or
substantially all of the assets of a Subsidiary Guarantor (including by way of
merger or consolidation) to a Person that is not (either before or after giving
effect to such transaction) a Subsidiary of the Company, and as a result of
which such Subsidiary Guarantor ceases to be a Restricted Subsidiary, if the
sale or other disposition complies with Section 4.06 hereof, (b) in connection
with any sale of all of the Capital Stock of a Subsidiary Guarantor to a Person
that is not (either before or after giving effect to such transaction) a
Subsidiary of the Company, and as a result of which such Subsidiary Guarantor
ceases to be a Restricted Subsidiary, if the sale complies with Section 4.06
hereof, (c) the designation of any Restricted Subsidiary that is a Subsidiary
Guarantor as an Unrestricted Subsidiary in accordance with Section 4.14 hereof,
or (d) the discharge or release of all guarantees by such Subsidiary Guarantor
of, and all pledges of property or assets of such Subsidiary Guarantor securing,
all other Indebtedness of the Company and the Restricted Subsidiaries, then such
Guarantor or, in the case of a sale or other disposition of all or substantially
all of
48
the assets of such Guarantor, the Person acquiring such property, will be
released and relieved of any obligations under its Guarantee. Upon delivery by
the Company to the Trustee of an Officers' Certificate and an Opinion of Counsel
to the effect that such sale, disposition, redesignation or discharge or release
was made by the Company in accordance with the provisions of the Indenture, the
Trustee shall execute any documents reasonably required in order to evidence the
release of any Guarantor from its obligations under its Guarantee.
Any Guarantor not released from its obligations under its Guarantee
shall remain liable for the full amount of principal of and interest on the
Notes and for the other obligations of any Guarantor under this Indenture as
provided in this Article Nine.
ARTICLE 10.
DEFEASANCE
Pursuant to Section 2.01(r) of the Base Indenture, so long as any of
the Notes are outstanding, the following provision shall supercede and replace
in its entirety Section 8.04 of the Base Indenture with respect to the Notes:
Section 10.01. Covenant Defeasance.
Upon the Company's exercise under Section 8.02 of the Base Indenture of
the option applicable to this Section 10.01, the Company and the Guarantors
shall, subject to the satisfaction of the conditions set forth in Section 8.05
of the Base Indenture, be released from their respective obligations under the
covenants contained in Sections 4.02 through 4.14, and Section 5.01 hereof with
respect to the outstanding Securities of any series on and after the date the
conditions set forth in Section 8.05 of the Base Indenture are satisfied, and
the Securities of such series shall thereafter be deemed not "outstanding" for
the purposes of any direction, waiver, consent or declaration or act of Holders
(and the consequences of any thereof) in connection with such covenants, but
shall continue to be deemed "outstanding" for all other purposes hereunder (it
being understood that such Securities shall not be deemed outstanding for
accounting purposes). For this purpose, "Covenant Defeasance" means that, with
respect to the outstanding Securities of any series, the Company and the
Guarantors may omit to comply with and shall have no liability in respect of any
term, condition or limitation set forth in any such covenant, whether directly
or indirectly, by reason of any reference elsewhere herein to any such covenant
or by reason of any reference in any such covenant to any other provision herein
or in any other document and such omission to comply shall not constitute a
Default or an Event of Default under Section 6.01 hereof, but, except as
specified above, the remainder of this First Supplemental Indenture and such
Securities shall be unaffected thereby. In addition, upon the Company's exercise
under Section 8.02 of the Base Indenture of the option applicable to this
Section 10.01, subject to the satisfaction of the conditions set forth in
Section 8.05 hereof, Sections 6.01(c) through 6.01(j) of this First Supplemental
Indenture shall not constitute Events of Default.
Section 10.02. Miscellaneous.
So long as any Notes are outstanding, references in Section 8.05(c) of
the Base Indenture to Section 6.01(4) and 6.01(5) thereof shall, for purposes of
the Notes and this First Supplemental Indenture, be deemed to refer to Section
6.01(h) and 6.01(i), respectively, of this First Supplemental Indenture.
49
ARTICLE 11.
MISCELLANEOUS
Section 11.01. Ratification of Base Indenture.
Except as specifically modified herein, the Base Indenture is in all
respects ratified and confirmed and shall remain in full force and effect in
accordance with its terms.
Section 11.02. Application of First Supplemental Indenture.
Each and every term and condition contained in this First Supplemental
Indenture that modifies, amends or supplements the terms and conditions of the
Base Indenture shall apply only to the Notes created hereby and not to any
future series of Securities established under the Base Indenture.
Section 11.03. Benefits of First Supplemental Indenture.
Nothing contained in this First Supplemental Indenture shall or shall
be construed to confer upon any person other than a Holders of the Notes, the
Company, the Holders of Senior Indebtedness and the Trustee any right or
interest to avail itself of any benefit under any provision of this First
Supplemental Indenture.
Section 11.04. Effective Date.
This First Supplemental Indenture shall be effective as of the date
first written above and upon the execution and delivery hereof by each of the
parties hereto.
Section 11.05. Trustee.
The Trustee shall not be responsible in any manner whatsoever for or in
respect of the validity or sufficiency of this First Supplemental Indenture or
for or in respect of the recitals contained herein, all of which are made solely
by the Company.
Section 11.06. Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE, THE NOTES AND THE SUBSIDIARY GUARANTEES 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 11.07. Successors.
All agreements of the Company in the Indenture and the Notes shall bind
its successors. All agreements of the Trustee in this First Supplemental
Indenture shall bind its successors. All agreements of each Guarantor in this
First Supplemental Indenture shall bind its successors, except as otherwise
provided in Section 9.06.
Section 11.08. Severability.
In case any provision in this First Supplemental Indenture or in the
Notes shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
50
Section 11.09. Counterpart Originals.
The parties may sign any number of copies of this First Supplemental
Indenture. Each signed copy shall be an original, but all of them together
represent the same agreement.
[Signatures on following page]
51
SIGNATURES
Dated as of March 5, 2002
ISSUERS:
-------
ENTERCOM RADIO, LLC
By: /s/ John C. Donlevie
-----------------------------
Name: John C. Donlevie
Title: Executive Vice
President, Secretary,
and General Counsel
52
GUARANTORS:
-----------
ENTERCOM COMMUNICATIONS CORP.
ENTECOM BOSTON I TRUST
ENTECOM NEW YORK, INC.
ENTECOM BOSTON, LLC
ENTERCOM BOSTON LICENSE, LLC
ENTERCOM BUFFALO, LLC
ENTERCOM BUFFALO LICENSE, LLC
ENTERCOM DENVER, LLC
ENTERCOM DENVER LICENSE, LLC
DELAWARE EQUIPMENT HOLDINGS, LLC
ENTERCOM GAINESVILLE, LLC
ENTERCOM GAINESVILLE LICENSE, LLC
ENTERCOM GREENSBORO, LLC
ENTERCOM GREENSBORO LICENSE, LLC
ENTERCOM GREENVILLE, LLC
ENTERCOM GREENVILLE LICENSE, LLC
ENTERCOM INTERNET HOLDING, LLC
ENTERCOM KANSAS CITY, LLC
ENTERCOM KANSAS CITY LICENSE, LLC
ENTERCOM LONGVIEW, LLC
ENTERCOM LONGVIEW LICENSE, LLC
ENTERCOM MADISON, LLC
ENTERCOM MADISON LICENSE, LLC
ENTERCOM MEMPHIS, LLC
ENTERCOM MEMPHIS LICENSE, LLC
ENTERCOM MILWAUKEE, LLC
ENTERCOM MILWAUKEE LICENSE, LLC
ENTERCOM NEW ORLEANS, LLC
ENTERCOM NEW ORLEANS LICENSE, LLC
ENTERCOM NORFOLK, LLC
ENTERCOM NORFOLK LICENSE, LLC
By: /s/ John C. Donlevie
------------------------------
Name: John C. Donlevie
Title: Executive Vice President, Secretary
and General Counsel
53
ENTERCOM PORTLAND, LLC
ENTERCOM PORTLAND LICENSE, LLC
ENTERCOM ROCHESTER, LLC
ENTERCOM ROCHESTER LICENSE, LLC
ENTERCOM SACRAMENTO, LLC
ENTERCOM SACRAMENTO LICENSE, LLC
ENTERCOM SEATTLE, LLC
ENTERCOM SEATTLE LICENSE, LLC
ENTERCOM WICHITA, LLC
ENTERCOM WICHITA LICENSE, LLC
ENTERCOM WILKES-BARRE SCRANTON, LLC
By: /s/ John C. Donlevie
------------------------------
Name: John C. Donlevie
Title: Executive Vice President, Secretary
and General Counsel
ENTERCOM DELAWARE HOLDING CORPORATION
By: /s/ John C. Donlevie
------------------------------
Name: John C. Donlevie
Title: President, Secretary
and General Counsel
54
HSBC BANK USA, as Trustee
By: /s/ Deirdra N. Ross
--------------------------------
Name: Deirdra N. Ross
Title: Assistant Vice President
55
EXHIBIT A
[Face of Note]
- -------------------------------------------------------------------------------
CUSIP/CINS
7-5/8% Senior Subordinated Notes due 2014
No. ___ $150,000,000
ENTERCOM RADIO, LLC
ENTERCOM CAPITAL, INC.
promise, jointly and severally, to pay to _____________________________________
or registered assigns, the principal sum of One Hundred and Fifty Million
Dollars on March 1, 2014.
Interest Payment Dates: March 1 and September 1
Record Dates: February 15 and August 15
Dated: March 5, 2002
ENTERCOM RADIO, LLC
By: ___________________________________
Name:
Title:
ENTERCOM CAPITAL, INC.
By: ___________________________________
Name:
Title:
This is one of the Notes referred to
in the within-mentioned Indenture:
HSBC BANK USA,
as Trustee
By: ____________________________________
Authorized Officer
- -------------------------------------------------------------------------------
56
[Back of Note]
7-5/8% Senior Subordinated Notes due 2014
[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. INTEREST. Entercom Radio LLC, a Delaware limited liability
company ("Radio") and Entercom Capital, Inc., a Delaware corporation
("Capital," each of Radio and Capital being referred to herein individually as
an "Issuer" and collectively as the "Company"), promise, jointly and severally,
to pay interest on the principal amount of this Note at 7-5/8% per annum from
March 5, 2002 until maturity. The Company will pay interest semi-annually in
arrears on March 1 and September 1 of each year, or if any such day is not a
Business Day, on the next succeeding Business Day (each an "Interest Payment
Date"). Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the date of
issuance; provided that if there is no existing Default in the payment of
interest, and if this Note is authenticated between a record date referred to
on the face hereof and the next succeeding Interest Payment Date, interest
shall accrue from such next succeeding Interest Payment Date; provided,
further, that the first Interest Payment Date shall be September 1, 2002. The
Company shall pay interest (including post-petition interest in any proceeding
under any Bankruptcy Law) on overdue principal and premium, if any, from time
to time on demand at a rate that is 1% per annum in excess of the rate then in
effect; it shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace periods) from time to time on demand at
the same rate to the extent lawful. Interest will be computed on the basis of
a 360-day year of twelve 30-day months.
2. METHOD OF PAYMENT. The Company will pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of Notes
at the close of business on the February 15 or August 15 next preceding the
Interest Payment Date, even if such Notes are canceled after such record date
and on or before such Interest Payment Date, except as provided in Section 2.11
of the Base Indenture with respect to defaulted interest. The Notes will be
payable as to principal, premium, if any, and interest at the office or agency
of the Company maintained for such purpose within or without the City and State
of New York, or, at the option of the Company, payment of interest may be made
by check mailed to the Holders at their addresses set forth in the register of
Holders, and provided that payment by wire transfer of immediately available
funds will be required with respect to principal of and interest and premium on,
all Global Notes and all other Notes the Holders of which will have purchased
wire transfer instructions to the Company or the Paying Agent. Such payment
shall be in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. Initially, HSBC Bank USA, the
Trustee under the Indenture, will act as Paying Agent and Registrar. The
Company may change any Paying Agent or Registrar without notice to any Holder.
The Company or any of its Subsidiaries may act in any such capacity.
4. INDENTURE. The Company issued the Notes under an Indenture
dated as of March 5, 2002 (the "Base Indenture"), as supplemented by the First
Supplemental Indenture, dated as of March 5, 2002 (the "First Supplemental
Indenture," and together with the Base Indenture, the "Indenture") among the
Company, the guarantors party thereto (the "Guarantors") and the Trustee. The
terms of the Notes include those stated in the Indenture and those made part of
the Indenture by reference to the Trust Indenture Act of 1939, as amended (15
U.S. Code [sec][sec] 77aaa-77bbbb). The Notes are subject to all such
57
terms, and Holders are referred to the Indenture and such Act for a statement
of such terms. To the extent any provision of this Note conflicts with the
express provisions of the Indenture, the provisions of the Indenture shall
govern and be controlling. The Notes are unsecured obligations of the Company
initially limited to $150.0 million in aggregate principal amount.
5. OPTIONAL REDEMPTION.
(a) Except as set forth in subparagraph (b) of this Paragraph 5,
the Company shall not have the option to redeem the Notes prior to March 1,
2007. Thereafter, the Company shall have the option to redeem the Notes, in
whole or in part, upon not less than 30 nor more than 60 days' notice, at the
redemption prices (expressed as percentages of principal amount) set forth
below plus accrued and unpaid interest thereon to the applicable redemption
date, if redeemed during the twelve-month period beginning on March 1 of the
years indicated below:
Year Percentage
- ---- ----------
2007 ..................................................... 103.813%
2008 ..................................................... 102.542%
2009 ..................................................... 101.271%
2010 and thereafter ...................................... 100.00%
(b) Notwithstanding the provisions of subparagraph (a) of this
Paragraph 5, at any time prior to March 1, 2005, the Company may redeem up to
35% of the aggregate principal amount of Notes issued under the Indenture with
the net proceeds of one or more Equity Offerings at a redemption price equal to
107.625% of the aggregate principal amount thereof; provided that at least 65%
in aggregate principal amount of the Notes originally issued remain outstanding
immediately after the occurrence of such redemption and that such redemption
occurs within 180 days of the date of the closing of such Equity Offering.
6. MANDATORY REDEMPTION.
The Company shall not be required to make mandatory redemption or
sinking fund payments with respect to the Notes.
7. REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Company shall be required
to make an offer (a "Change of Control Offer") to repurchase all or any part
(equal to $1,000 or an integral multiple thereof) of each Holder's Notes at a
purchase price equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid interest thereon, if any, to the date of purchase (the
"Change of Control Payment"). Within 60 days following any Change of Control,
the Company shall mail a notice to each Holder setting forth the procedures
governing the Change of Control Offer as required by the Indenture.
(b) If the Company or a Subsidiary consummates any Asset Sales,
within five days of each date on which the aggregate amount of Excess Proceeds
exceeds $10.0 million, the Company shall commence an offer to all Holders of
Notes (as "Asset Sale Offer") pursuant to Section 3.03 of the First
Supplemental Indenture to purchase the maximum principal amount of Notes
(including any Additional Notes) and other pari passu Indebtedness that may be
purchased out of the Excess Proceeds at an offer price in cash in an amount
equal to 100% of the principal amount thereof plus accrued and unpaid interest
thereon, if any, to the date fixed for the closing of such offer, in accordance
with the procedures set forth in the Indenture. To the extent that the
aggregate amount of Notes (including any Additional Notes) and other pari passu
Indebtedness tendered pursuant to an Asset Sale Offer is less than the Excess
Proceeds, the Company (or such Subsidiary) may use such deficiency for any
purpose not otherwise prohibited by
58
the Indenture. If the aggregate principal amount of Notes and other pari passu
Indebtedness surrendered by Holders thereof exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes and other pari passu Indebtedness
to be purchased on a pro rata basis. Holders of Notes that are the subject of an
offer to purchase will receive an Asset Sale Offer from the Company prior to any
related purchase date and may elect to have such Notes purchased by completing
the form entitled "Option of Holder to Elect Purchase" on the reverse of the
Notes.
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed at
least 30 days but not more than 60 days before the redemption date to each
Holder whose Notes are to be redeemed at its registered address. Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest ceases to accrue on Notes
or portions thereof called for redemption.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of Notes may be registered and Notes may be exchanged as
provided in the Indenture. The Registrar and the Trustee may require a Holder,
among other things, to furnish appropriate endorsements and transfer documents
and the Company may require a Holder to pay any taxes and fees required by law
or permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Company
need not exchange or register the transfer of any Notes for a period of 15 days
before a selection of Notes to be redeemed or during the period between a
record date and the corresponding Interest Payment Date.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note
may be treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions, the Indenture, the Guarantees or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in
principal amount of the then outstanding Notes and Additional Notes, if any,
voting as a single class, and any existing Default or compliance with any
provision of the Indenture, the Guarantees or the Notes may be waived with the
consent of the Holders of a majority in principal amount of the then
outstanding Notes and Additional Notes, if any, voting as a single class.
Without the consent of any Holder of a Note, the Indenture, the Guarantees or
the Notes may be amended or supplemented to cure any ambiguity, defect or
inconsistency, to provide for uncertificated Notes in addition to or in place
of certificated Notes, to provide for the assumption of the Company's or
Guarantor's obligations to Holders of the Notes in case of a merger or
consolidation, to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the
legal rights under the Indenture of any such Holder, to comply with the
requirements of the SEC in order to effect or maintain the qualification of the
Indenture under the Trust Indenture Act, to provide for the Issuance of
Additional Notes in accordance with the limitations set forth in the Indenture,
or to allow any Guarantor to execute a supplemental indenture to the Indenture
and/or a Guarantee with respect to the Notes.
12. DEFAULTS AND REMEDIES. Events of Default include: (i) default
for 30 days in the payment when due of interest on the Notes; (ii) default in
payment when due of principal of or premium, if any, on the Notes when the same
becomes due and payable at maturity, upon redemption (including in connection
with an offer to purchase) or otherwise, (iii) failure by the Company to comply
with Section 4.09 of the First Supplemental Indenture; (iv) failure by the
Company for 30 days to comply with Section 4.03, 4.05 or 4.06 or 5.01 of the
First Supplemental Indenture; (v) failure by the Company for 60 days after
notice to the Company by the Trustee or the Holders of at least 25% in
principal amount of the Notes (including Additional Notes, if any) then
outstanding voting as a single class to comply with certain other agreements in
the Indenture, the Notes; (vi) default under certain other agreements relating
to Indebtedness of the Company which default is caused by a failure to pay
principal of such Indebtedness at
59
the final maturity thereof or results in the acceleration of such Indebtedness
prior to its express maturity; (vii) certain final judgments for the payment of
money that remain undischarged for a period of 60 days; (viii) certain events
of bankruptcy or insolvency with respect to the Company or any of its
Significant Subsidiaries; and (ix) except as permitted by the Indenture, any
Guarantee of a Significant Subsidiary shall be held in any judicial proceeding
to be unenforceable or invalid or shall cease for any reason to be in full
force and effect or any Guarantor that is a Significant Subsidiary or any
Person acting on its behalf shall deny or disaffirm its obligations under such
Guarantor's Guarantee. If any Event of Default occurs and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the then
outstanding Notes may declare all the Notes to be due and payable; provided
that the Notes shall not become due and payable until the Credit Agreement
shall have been declared or be due and payable or the Trustee or such Holders
shall have provided 5 business days' notice to the agent(s) under the Credit
Agreement of such acceleration. Notwithstanding the foregoing, in the case of
an Event of Default arising from certain events of bankruptcy or insolvency,
all outstanding Notes will become due and payable without further action or
notice. Holders may not enforce the Indenture or the Notes except as provided
in the Indenture. Subject to certain limitations, Holders of a majority in
principal amount of the then outstanding Notes may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders of the
Notes notice of any continuing Default or Event of Default (except a Default or
Event of Default relating to the payment of principal or interest) if it
determines that withholding notice is in their interest. The Holders of a
majority in aggregate principal amount of the Notes then outstanding by notice
to the Trustee may on behalf of the Holders of all of the Notes waive any
existing Default or Event of Default and its consequences under the Indenture
except a continuing Default or Event of Default in the payment of interest on,
or the principal of, the Notes. The Company is required to deliver to the
Trustee annually a statement regarding compliance with the Indenture, and the
Company is required upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of Default.
13. SUBORDINATION. The Notes are subordinated to Senior
Indebtedness, as defined in the First Supplemental Indenture. To the extent
provided in the First Supplemental Indenture, Senior Indebtedness must be paid
in full before the Notes may be paid. The Company and each Guarantor agrees,
and each Holder by accepting a Note agrees, to the subordination provisions
contained in the Indenture and authorizes the Trustee to give it effect and
appoints the Trustee as attorney-in-fact for such purpose.
14. TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its
individual or any other capacity, may make loans to, accept deposits from, and
perform services for the Company or its Affiliates, and may otherwise deal with
the Company or its Affiliates, as if it were not the Trustee.
15. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
manager, incorporator or stockholder, of the Company or any Guarantor, as such,
shall not have any liability for any obligations of the Company or any
Guarantor under the Notes, and Guarantee thereof or the Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the
issuance of the Notes.
16. AUTHENTICATION. This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
17. ABBREVIATIONS. Customary abbreviations may be used in the
name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN
ENT (= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).
60
18. CUSIP NUMBERS. Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP
numbers in notices of redemption as a convenience to Holders. No representation
is made as to the accuracy of SUCH numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
19. GOVERNING LAW. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THE NOTES 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.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
Entercom Communications Corp.
401 City Avenue, Suite 409
Bala Cynwyd, PA 19004
Attention: John Donlevie, Esq.
61
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to: _________________________________
(Insert assignee's legal name)
_______________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date: _______________
Your Signature: ________________________
(Sign exactly as your name appears on
the face of this Note)
Signature Guarantee*: _________________________
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
62
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.06 or 4.09 of the Indenture, check the appropriate box
below:
[ ] Section 4.06 [ ] Section 4.09
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.06 or Section 4.09 of the Indenture, state the
amount you elect to have purchased:
$__________________
Date: _______________
Your Signature: ________________________
(Sign exactly as your name appears on
the face of this Note)
Tax Identification No.: ________________
Signature Guarantee*: _________________________
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
63
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an interest
in another Global Note or for a Definitive Note, or exchanges of a part of
another Global Note or Definitive Note for an interest in this Global Note, have
been made:
Principal Amount
of this Global Note Signature of
Amount of Amount of following such authorized officer
decrease in increase in decrease (or of Trustee or Note
Principal Amount Principal Amount ------------ ----
Date of Exchange of this Global Note of this Global Note increase) Custodian
- ---------------- ------------------- ------------------- --------- ---------
* This schedule should be included only if the Note is issued in
global form.
64
EXHIBIT B
FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
________________, among __________________ (the "Guaranteeing Subsidiary"), a
subsidiary of Entercom Radio, LLC (or its permitted successor), a Delaware
limited liability company (the "Company"), the Company, the other Guarantors (as
defined in the Indenture referred to herein) and HSBC Bank USA, as trustee under
the Indenture referred to below (the "Trustee").
W I T N E S S E T H
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of March 5, 2002 providing for
the issuance of an unlimited aggregate principal amount of 7-5/8% Senior
Subordinated Notes due 2014 (the "Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental
indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally
guarantee all of the Company's Obligations under the Notes and the Indenture on
the terms and conditions set forth herein (the "Subsidiary Guarantee"); and
WHEREAS, pursuant to Section 9.01 of the First Supplemental Indenture,
the Trustee is authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without
definition shall have the meanings assigned to them in the Indenture.
2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby
agrees as follows:
(a) Along with all Guarantors named in the Indenture, to
jointly and severally Guarantee to each Holder of a Note authenticated
and delivered by the Trustee and to the Trustee and its successors and
assigns, the Notes or the obligations of the Company hereunder or
thereunder, that:
(i) the principal of and premium, if any, and
interest on the Notes will be promptly paid in full when due,
whether at maturity, by acceleration, redemption or otherwise,
and interest on the overdue principal of and interest on the
Notes, if any, if lawful, and all other obligations of the
Company to the Holders or the Trustee hereunder or thereunder
will be promptly paid in full or performed, all in accordance
with the terms hereof and thereof; and
(ii) in case of any extension of time of payment
or renewal of any Notes or any of such other obligations, that
same will be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, whether
at Stated Maturity, by acceleration or otherwise. Failing
payment when due of any amount so guaranteed or any performance
so guaranteed for whatever reason, the Guarantors shall be
jointly and severally obligated to pay the same immediately.
65
(b) The obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the Notes
or the Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Notes with respect to any
provisions hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance which
might otherwise constitute a legal or equitable discharge or defense of
a guarantor.
(c) The following is hereby waived: diligence
presentment, demand of payment, filing of claims with a court in the
event of insolvency or bankruptcy of the Company, any right to require
a proceeding first against the Company, protest, notice and all demands
whatsoever.
(d) This Subsidiary Guarantee shall not be discharged
except by complete performance of the obligations contained in the
Notes and the Indenture, and the Guaranteeing Subsidiary accepts all
obligations of a Guarantor under the Indenture.
(e) If any Holder or the Trustee is required by any court
or otherwise to return to the Company, the Guarantors, or any
Custodian, Trustee, liquidator or other similar official acting in
relation to either the Company or the Guarantors, any amount paid by
either to the Trustee or such Holder, this Guarantee, to the extent
theretofore discharged, shall be reinstated in full force and effect.
(f) The Guaranteeing Subsidiary shall not be entitled to
any right of subrogation in relation to the Holders in respect of any
obligations guaranteed hereby until payment in full of all obligations
guaranteed hereby.
(g) As between the Guarantors, on the one hand, and the
Holders and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article
6 of the Indenture for the purposes of this Guarantee, notwithstanding
any stay, injunction or other prohibition preventing such acceleration
in respect of the obligations guaranteed hereby, and (y) in the event
of any declaration of acceleration of such obligations as provided in
Article 6 of the Indenture, such obligations (whether or not due and
payable) shall forthwith become due and payable by the Guarantors for
the purpose of this Guarantee.
(h) The Guarantors shall have the right to seek
contribution from any non-paying Guarantor so long as the exercise of
such right does not impair the rights of the Holders under the
Guarantee.
(i) Pursuant to Section 9.03 of the First Supplemental
Indenture, after giving effect to any maximum amount and any other
contingent and fixed liabilities that are relevant under any applicable
Bankruptcy or fraudulent conveyance laws, and after giving effect to
any collections from, rights to receive contribution from or payments
made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under Article Nine of the First
Supplemental Indenture, this new Subsidiary Guarantee shall be limited
to the maximum amount permissible such that the obligations of such
Guarantor under this Subsidiary Guarantee will not constitute a
fraudulent transfer or conveyance.
3. EXECUTION AND DELIVERY. Each Guaranteeing Subsidiary agrees
to execute the Subsidiary Guarantee as provided by Section 9.04 of the First
Supplemental Indenture and Exhibit B thereto and to recognize that the
Guarantees shall remain in full force and effect notwithstanding any failure to
endorse on each Note a notation of such Guarantee.
66
4. GUARANTEEING SUBSIDIARY MAY CONSOLIDATE, ETC. ON CERTAIN
TERMS.
(a) A Guaranteeing Subsidiary may not sell or consolidate
with or merge with or into (whether or not such Guaranteeing Subsidiary
is the surviving Person) another Person other than the Company, the
Parent Guarantor or another Guaranteeing Subsidiary unless:
(1) immediately after giving effect to such transaction,
no Default or Event of Default exists; and
(2) either
(i) subject to Sections 9.05 and 9.06 of the
First Supplemental Indenture, the Person acquiring the
property in any such sale of disposition or the Person formed
by or surviving any such consolidation or merger (if other
than a Guaranteeing Subsidiary or the Company) unconditionally
assumes all the obligations of such Guaranteeing Subsidiary,
pursuant to a supplemental indenture in form and substance
reasonably satisfactory to the Trustee, under the Notes, the
First Supplemental Indenture and the Guarantee on the terms
set forth herein or therein; or
(ii) the Net Proceeds of such sale or other
disposition are applied in accordance with the applicable
provisions of the Indenture, including, without limitation,
Section 4.06 of the First Supplemental Indenture.
(b) In case of any such consolidation, merger, sale or
conveyance and upon the assumption by the successor corporation, by
supplemental indenture, executed and delivered to the Trustee and
satisfactory in form to the Trustee, of the Subsidiary Guarantee
endorsed upon the Notes and the due and punctual performance of all of
the covenants and conditions of the Indenture to be performed by the
Guarantor, such successor Person shall succeed to and be substituted
for the Guarantor with the same effect as if it had been named herein
as a Guarantor. Such successor Person thereupon may cause to be signed
any or all of the Guarantees to be endorsed upon all of the Notes
issuable hereunder which theretofore shall not have been signed by the
Company and delivered to the Trustee. All the Guarantees so issued
shall in all respects have the same legal rank and benefit under the
Indenture as the Guarantees theretofore and thereafter issued in
accordance with the terms of the Indenture as though all of such
Guarantees had been issued at the date of the execution hereof.
(c) Except as set forth in Articles 4 and 5 and Section
9.06 of Article 9 of the First Supplemental Indenture, and
notwithstanding clauses (a)(2)(i) and (ii) above, nothing contained in
the First Supplemental Indenture or in any of the Notes shall prevent
any consolidation or merger of a Guarantor with or into the Company or
another Guarantor, or shall prevent any sale or conveyance of the
property of a Guarantor as an entirety or substantially as an entirety
to the Company or another Guarantor.
5. RELEASES.
In the event of (i) any sale or other disposition of all or
substantially all of the assets of a Subsidiary Guarantor (including by
way of merger or consolidation) to a Person that is not (either before
or after giving effect to such transaction) a Subsidiary of the
Company, and as a result of which such Subsidiary Guarantor ceases to
be a Restricted Subsidiary, if the sale or other disposition complies
with Section 4.06 of the First Supplemental Indenture, (ii) in
connection with any sale of all of the Capital Stock of a Subsidiary
Guarantor to a Person that is not (either before or after giving effect
to such transaction) a Subsidiary of the Company, and as a result of
67
which such Subsidiary Guarantor ceases to be a Restricted Subsidiary,
if the sale complies with Section 4.06 of the First Supplemental
Indenture, (iii) the designation of any Restricted Subsidiary that is a
Subsidiary Guarantor as an Unrestricted Subsidiary in accordance with
Section 4.14 of the First Supplemental Indenture, or (iv) the discharge
or release of all guarantees by such Subsidiary Guarantor of, and all
pledges of property or assets of such Subsidiary Guarantor securing,
all other Indebtedness of the Company and the Restricted Subsidiaries,
then such Guarantor or, in the case of a sale or other disposition of
all or substantially all of the assets of such Guarantor, the Person
acquiring such property, will be released and relieved of any
obligations under its Guarantee. Upon delivery by the Company to the
Trustee of an Officers' Certificate and an Opinion of Counsel to the
effect that such sale, disposition, redesignation or discharge or
release was made by the Company in accordance with the provisions of
the Indenture, the Trustee shall execute any documents reasonably
required in order to evidence the release of any Guarantor from its
obligations under its Guarantee.
(b) Any Guarantor not released from its obligations under
its Subsidiary Guarantee shall remain liable for the full amount of
principal of and interest on the Notes and for the other obligations of
any Guarantor under the Indenture as provided in Article 9 of the First
Supplemental Indenture.
6. NO RECOURSE AGAINST OTHERS. No past, present or future
director, officer, employee, manager, incorporator, stockholder or agent of the
Guaranteeing Subsidiary, as such, shall have any liability for any obligations
of the Company or any Guaranteeing Subsidiary under the Notes, any Guarantees,
the Indenture or this Supplemental Indenture or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder of
the Notes by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for issuance of the Notes.
Such waiver may not be effective to waive liabilities under the federal
securities laws and it is the view of the SEC that such a waiver is against
public policy.
7. GOVERNING LAW. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE 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.
8. SUBMISSION TO JURISDICTION; SERVICE OF PROCESS; WAIVER OF JURY
TRIAL. Each party hereto hereby submits to the nonexclusive jurisdiction of the
United States District Court for the Southern District of New York and of any
New York State Court sitting in New York City for purposes of all legal
proceedings arising out of or relating to this Supplemental Indenture, the
Notes, the Guarantees or the transactions contemplated hereby and thereby. Each
party hereto irrevocably waives, to the fullest extent permitted by law, any
objection which it may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum. Process in
any such suit, action or proceeding may be served on any party anywhere in the
world, whether within or without the State of New York. Without limiting the
foregoing, the parties agree that service of process upon such party at the
address referred to in Section 11.02 of the Base Indenture, together with
written notice of such service to such party, shall be deemed effective service
of process upon such party. Each of the parties hereto irrevocably waives any
and all rights to trial by jury in any legal proceeding arising out of or
relating to the Indenture, the Notes, the Guarantees or the transactions
contemplated hereby and thereby.
9. COUNTERPARTS. The parties may sign any number of copies of
this Supplemental Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement.
68
10. EFFECT OF HEADINGS. The Section headings herein are for
convenience only and shall not affect the construction hereof.
11. THE TRUSTEE. The Trustee shall not be responsible in any
manner whatsoever for or in respect of the validity or sufficiency of this
Supplemental Indenture or for or in respect of the recitals contained herein,
all of which recitals are made solely by the Guaranteeing Subsidiary and the
Company.
12. SUBORDINATION. The Subsidiary Guarantees are subordinated to
Senior Indebtedness, as defined in the First Supplement Indenture. To the
extent provided in the First Supplemental Indenture, Senior Indebtedness must
be paid in full before the Notes may be paid. Each Guarantor hereby agrees, and
each Holder, by accepting a Guarantee hereby agrees, to the subordination
provisions contained in the Indenture and authorizes the Trustee to give them
effect and appoints the Trustee as attorney-in-fact for such purpose.
69
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated: _______________, ____
[GUARANTEEING SUBSIDIARY]
By: ______________________________
Name:
Title:
ENTERCOM RADIO, LLC
By: ______________________________
Name:
Title:
ENTERCOM CAPITAL, INC.
By: ______________________________
Name:
Title:
GUARANTORS
By: ______________________________
Name:
Title:
HSBC BANK USA
as Trustee
By: ______________________________
Authorized Officer
70
EXHIBIT C
[FORM OF NOTATION OF GUARANTEE]
For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture and subject to the
provisions in the Indenture dated as of March 5, 2002 (the "Base Indenture"), as
supplemented by the First Supplemental Indenture thereto, dated as of March 5,
2002 (the "Supplemental Indenture," and together with the Base Indenture, the
"Indenture") among Entercom Radio, LLC ("Radio"), Entercom Capital, Inc.
("Capital," and together with Radio, the "Company"), Entercom Communications
Corp., the Guarantors listed on Schedule I thereto and HSBC Bank USA, as Trustee
(the "Trustee"), (a) the due and punctual payment of the principal of, premium,
if any, and interest on the Notes (as defined in the Indenture), whether at
maturity, by acceleration, redemption or otherwise, the due and punctual payment
of interest on overdue principal and premium, and, to the extent permitted by
law, interest, and the due and punctual performance of all other obligations of
the Company to the Holders or the Trustee all in accordance with the terms of
the Indenture and (b) in case of any extension of time of payment or renewal of
any Notes or any of such other obligations, that the same will be promptly paid
in full when due or performed in accordance with the terms of the extension or
renewal, whether at Stated Maturity, by acceleration or otherwise. The
obligations of the Guarantors to the Holders of Notes and to the Trustee
pursuant to the Subsidiary Guarantee and the Indenture are expressly set forth
in Article 9 of the First Supplemental Indenture and reference is hereby made to
the Indenture for the precise terms of the Subsidiary Guarantee. Each Holder of
a Note, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee, on behalf of such Holder, to
take such action as may be necessary or appropriate to effectuate the
subordination as provided in the Indenture and (c) appoints the Trustee
attorney-in-fact of such Holder for such purpose; provided, however, that the
Indebtedness evidenced by this Subsidiary Guarantee shall cease to be so
subordinated and subject in right of payment upon any defeasance of this Note in
accordance with the provisions of the Indenture.
71
ENTERCOM COMMUNICATIONS CORP.
ENTERCOM BOSTON I TRUST
ENTERCOM NEW YORK, INC.
ENTERCOM BOSTON, LLC
ENTERCOM BOSTON LICENSE, LLC
ENTERCOM BUFFALO, LLC
ENTERCOM BUFFALO LICENSE, LLC
ENTERCOM DENVER, LLC
ENTERCOM DENVER LICENSE, LLC
DELAWARE EQUIPMENT HOLDINGS, LLC
ENTERCOM GAINESVILLE, LLC
ENTERCOM GAINESVILLE LICENSE, LLC
ENTERCOM GREENSBORO, LLC
ENTERCOM GREENSBORO LICENSE, LLC
ENTERCOM GREENVILLE, LLC
ENTERCOM GREENVILLE LICENSE, LLC
ENTERCOM INTERNET HOLDING, LLC
ENTERCOM KANSAS CITY, LLC
ENTERCOM KANSAS CITY LICENSE, LLC
ENTERCOM LONGVIEW, LLC
ENTERCOM LONGVIEW LICENSE, LLC
ENTERCOM MADISON, LLC
ENTERCOM MADISON LICENSE, LLC
ENTERCOM MEMPHIS, LLC
ENTERCOM MEMPHIS LICENSE, LLC
ENTERCOM MILWAUKEE, LLC
ENTERCOM MILWAUKEE LICENSE, LLC
ENTERCOM NEW ORLEANS, LLC
ENTERCOM NEW ORLEANS LICENSE, LLC
ENTERCOM NORFOLK, LLC
ENTERCOM NORFOLK LICENSE, LLC
By: ________________________________
Name:
Title:
72
ENTERCOM PORTLAND, LLC
ENTERCOM PORTLAND LICENSE, LLC
ENTERCOM ROCHESTER, LLC
ENTERCOM ROCHESTER LICENSE, LLC
ENTERCOM SACRAMENTO, LLC
ENTERCOM SACRAMENTO LICENSE, LLC
ENTERCOM SEATTLE, LLC
ENTERCOM SEATTLE LICENSE, LLC
ENTERCOM WICHITA, LLC
ENTERCOM WICHITA LICENSE, LLC
ENTERCOM WILKES-BARRE SCRANTON, LLC
By: ________________________________
Name:
Title:
ENTERCOM DELAWARE HOLDING CORPORATION
By: ________________________________
Name:
Title:
73
Schedule I
SCHEDULE OF GUARANTORS
The following schedule lists each Guarantor under the Indenture as of
the Closing Date:
74
Schedule 1
----------
DELAWARE EQUIPMENT HOLDINGS, LLC
ENTERCOM COMMUNICATIONS CORP.
ENTECOM DELAWARE HOLDING CORPORATION
ENTECOM BOSTON I TRUST
ENTECOM BOSTON LLC
ENTERCOM BOSTON LICENSE, LLC
ENTERCOM DENVER LLC
ENTERCOM DENVER LICENSE LLC
ENTERCOM GAINESVILLE, LLC
ENTERCOM GAINESVILLE LICENSE, LLC
ENTERCOM GREENSBORO LLC
ENTERCOM GREENSBORO LICENSE, LLC
ENTERCOM GREENVILLE LLC
ENTERCOM GREENVILLE LICENSE, LLC
ENTERCOM INTERNET HOLDING, LLC
ENTERCOM KANSAS CITY, LLC
ENTERCOM KANSAS CITY LICENSE, LLC
ENTERCOM LONGVIEW, LLC
ENTERCOM LONGVIEW LICENSE, LLC
ENTERCOM MADISON LLC
ENTERCOM MADISON LICENSE LLC
ENTERCOM MEMPHIS LLC
ENTERCOM MEMPHIS LICENSE, LLC
ENTERCOM MILWAUKEE LLC
ENTERCOM MILWAUKEE LICENSE, LLC
ENTERCOM NEW ORLEANS LLC
ENTERCOM NEW ORLEANS LICENSE, LLC
ENTERCOM NEW YORK, INC.
ENTERCOM BUFFALO LICENSE, LLC
ENTERCOM BUFFALO LLC
ENTERCOM ROCHESTER LLC
ENTERCOM ROCHESTER LICENSE LLC
ENTERCOM NORFOLK LLC
ENTERCOM NORFOLK LICENSE, LLC
ENTERCOM PORTLAND LLC
ENTERCOM PORTLAND LICENSE, LLC
ENTERCOM SACRAMENTO LLC
ENTERCOM SACRAMENTO LICENSE LLC
ENTERCOM SEATTLE, LLC.
ENTERCOM SEATTLE LICENSE, LLC
ENTERCOM WICHITA LLC
ENTERCOM WICHITA LICENSE LLC
ENTERCOM WILKES-BARRE/SCRANTON, LLC
75