EXHIBIT 9
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NORSKE SKOG CANADA LIMITED, as Issuer,
THE GUARANTORS PARTY HERETO, as Guarantors,
and
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee
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Indenture
Dated as of March 23, 2004
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US$250,000,000
7-3/8% Senior Notes Due March 1, 2014
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NORSKE SKOG CANADA LIMITED
Reconciliation and tie between Trust Indenture Act
of 1939 and Indenture, dated as of March 23, 2004
Trust Indenture Indenture
Act Section Section
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Section 310(a)(1) 6.10
(a)(2) 6.10
(a)(3) Not Applicable
(a)(4) Not Applicable
(b) 6.10
Section 311(a) 6.11
(b) 6.11
Section 312(a) 7.01, 7.02
(b) 7.02, 1.18
(c) 7.02, 1.18
(b) 7.03
(c) 7.03
(d) 7.03
313(a) 6.06
313(b)(2) 6.06
313(c) 6.06
313(d) 6.06
Section 314(a) 2.02
(a)(4) Not applicable
(b) Not Applicable
(c)(1) 2.02
(c)(2) 2.02
(c)(3) Not Applicable
(d) Not Applicable
(e) 10.2
Section 315(a) 6.01
(b) 6.02
(c) 6.01
(d) 6.01
(d)(1) 6.01
(e) 5.14
Section 316(a) 1.01
(a)(1)(A) 5.02, 5.12
(a)(1)(B) 5.13
(a)(2) Not Applicable
(b) 5.16
Section 317(a)(1) 5.04
(a)(2) 5.05
(b) 4.03, 4.04
Section 318(a) 1.07
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TABLE OF CONTENTS
Page
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RECITALS OF THE COMPANY.................................................. 1
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01 Definitions................................................. 1
SECTION 1.02 Compliance Certificates and Opinions........................ 31
SECTION 1.03 Form of Documents Delivered to Trustee...................... 32
SECTION 1.04 Acts of Holders; Record Date................................ 32
SECTION 1.05 Notices..................................................... 34
SECTION 1.06 Notice to Holders; Waiver................................... 35
SECTION 1.07 Conflict with Trust Indenture Act........................... 36
SECTION 1.08 Effect of Headings and Table of Contents.................... 36
SECTION 1.09 Successors and Assigns...................................... 36
SECTION 1.10 Separability Clause......................................... 36
SECTION 1.11 Benefits of Indenture....................................... 36
SECTION 1.12 No Personal Liability of Directors, Officers, Employees
and Stockholders...................................................... 36
SECTION 1.13 Governing Law............................................... 37
SECTION 1.14 Business Days; Legal Holidays............................... 37
SECTION 1.15 Consent to Service; Jurisdiction............................ 37
SECTION 1.16 Judgment Currency........................................... 38
SECTION 1.17 Currency Equivalent......................................... 40
SECTION 1.18 Communications by Holders with Other Holders................ 40
SECTION 1.19 No Adverse Interpretation of Other Agreements............... 40
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ARTICLE II
SECURITY FORMS
SECTION 2.01 Forms Generally and Amount of Notes......................... 40
SECTION 2.02 Security Registrar and Paying Agent......................... 41
SECTION 2.03 Paying Agent To Hold Money in Trust......................... 41
SECTION 2.04 Form of Security............................................ 42
SECTION 2.05 Book-Entry Provisions for Global Notes...................... 58
ARTICLE III
THE SECURITIES
SECTION 3.01 Title and Terms............................................. 59
SECTION 3.02 Denominations............................................... 60
SECTION 3.03 Execution, Authentication, Delivery and Dating.............. 60
SECTION 3.04 Temporary Securities........................................ 62
SECTION 3.05 Defaulted Interest.......................................... 62
SECTION 3.06 Deposit of Moneys........................................... 63
SECTION 3.07 Registration, Registration of Transfer and Exchange
Generally; Restrictions on Transfer and Exchange; Securities Act
Legends............................................................... 63
SECTION 3.08 Mutilated, Destroyed, Lost and Stolen Securities............ 68
SECTION 3.09 Outstanding Notes........................................... 69
SECTION 3.10 Computation of Interest..................................... 69
SECTION 3.1l Payment of Interest; Interest Rights Preserved.............. 70
SECTION 3.12 Persons Deemed Owners....................................... 71
SECTION 3.13 Cancellation................................................ 71
SECTION 3.14 CUSIP or ISIN Numbers....................................... 71
SECTION 3.15 Treasury Notes.............................................. 71
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ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.01 Satisfaction and Discharge of Indenture..................... 72
SECTION 4.02 Application of Trust Money.................................. 73
SECTION 4.03 Moneys Held by Paying Agent................................. 73
SECTION 4.04 Moneys Held by Trustee...................................... 73
ARTICLE V
REMEDIES
SECTION 5.01 Events of Default........................................... 74
SECTION 5.02 Acceleration of Maturity; Rescission and Annulment.......... 76
SECTION 5.03 Other Remedies.............................................. 77
SECTION 5.04 Collection of Indebtedness and Suits for Enforcement
by Trustee............................................................ 77
SECTION 5.05 Trustee May File Proofs of Claim............................ 78
SECTION 5.06 Trustee May Enforce Claims Without Possession of
Securities............................................................ 78
SECTION 5.07 Application of Money Collected.............................. 78
SECTION 5.08 Limitation on Suits......................................... 79
SECTION 5.09 Restoration of Rights and Remedies.......................... 79
SECTION 5.10 Rights and Remedies Cumulative.............................. 80
SECTION 5.11 Delay or Omission Not Waiver................................ 80
SECTION 5.12 Control by Holders.......................................... 80
SECTION 5.13 Waiver of Past Defaults and Events of Default............... 80
SECTION 5.14 Undertaking for Costs....................................... 80
SECTION 5.15 Waiver of Stay, Extension or Usury Laws..................... 81
SECTION 5.16 Rights of Holders To Receive Payment........................ 81
iv
SECTION 5.17 Collection Suit by Trustee.................................. 81
ARTICLE VI
THE TRUSTEE
SECTION 6.01 Duties of Trustee........................................... 81
SECTION 6.02 Rights of Trustee........................................... 83
SECTION 6.03 Individual Rights of Trustee................................ 84
SECTION 6.04 Trustee's Disclaimer........................................ 84
SECTION 6.05 Notice of Defaults.......................................... 84
SECTION 6.06 Reports by Trustee to Holders............................... 84
SECTION 6.07 Compensation and Indemnity.................................. 85
SECTION 6.08 Replacement of Trustee...................................... 86
SECTION 6.09 Successor Trustee by Consolidation, Merger, Etc............. 87
SECTION 6.10 Corporate Trustee Required; Eligibility..................... 87
SECTION 6.11 Preferential Collection of Claims Against Company........... 87
SECTION 6.12 Paying Agents............................................... 87
SECTION 6.13 Disqualification: Conflicting Interests..................... 88
SECTION 6.14 Appointment of Authenticating Agent......................... 88
ARTICLE VII
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 7.01 Company to Furnish Trustee Names and Addresses of Holders... 89
SECTION 7.02 Preservation of Information; Communications to Holders...... 89
SECTION 7.03 Reports by Trustee.......................................... 90
v
ARTICLE VIII
AMALGAMATIONS, MERGERS, CONSOLIDATIONS
AND CERTAIN SALES AND PURCHASES OF ASSETS
SECTION 8.01 The Company May Consolidate, Etc. Only on Certain Terms..... 90
SECTION 8.02 Successor Person Substituted................................ 91
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01 Without Consent of Holders.................................. 92
SECTION 9.02 With Consent of Holders..................................... 93
SECTION 9.03 Compliance with Trust Indenture Act......................... 94
SECTION 9.04 Revocation and Effect of Consents........................... 94
SECTION 9.05 Notation on or Exchange of Notes............................ 95
SECTION 9.06 Trustee To Sign Amendments, Etc............................. 95
SECTION 9.07 Effect of Supplemental Indentures........................... 95
SECTION 9.08 Reference in Securities to Supplemental Indentures.......... 95
ARTICLE X
COVENANTS
SECTION 10.01 Payment of Notes........................................... 95
SECTION 10.02 Reports to Holders......................................... 96
SECTION 10.03 [Intentionally Omitted.]................................... 96
SECTION 10.04 Compliance Certificate..................................... 96
SECTION 10.05 Taxes...................................................... 97
SECTION 10.06 Limitation on Additional Debt.............................. 97
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SECTION 10.07 Limitation on Restricted Payments.......................... 97
SECTION 10.08 Limitation on Liens........................................ 100
SECTION 10.09 Limitation on Transactions with Affiliates................. 101
SECTION 10.10 Limitation on Asset Sales.................................. 102
SECTION 10.11 Limitation on Capital Stock of Restricted Subsidiaries..... 104
SECTION 10.12 Limitation on Dividend and Other Payment Restrictions
Affecting Restricted Subsidiaries..................................... 104
SECTION 10.13 Limitation on Subsidiaries................................. 105
SECTION 10.14 Legal Existence............................................ 106
SECTION 10.15 Change of Control Offer.................................... 106
SECTION 10.16 Payment of Additional Amounts.............................. 108
SECTION 10.17 Limitation on Applicability of Certain Covenants if the
Notes Are Rated Investment Grade...................................... 109
ARTICLE XI
REDEMPTION OF SECURITIES
SECTION 11.01 Election to Redeem; Notices to Trustee..................... 109
SECTION 11.02 Selection by Trustee of Notes To Be Redeemed............... 110
SECTION 11.03 Notice of Redemption....................................... 110
SECTION 11.04 Effect of Notice of Redemption............................. 1ll
SECTION 11.05 Deposit of Redemption Price................................ 1ll
SECTION 11.06 Notes Redeemed in Part..................................... 1ll
SECTION 11.07 Optional Redemption........................................ 112
SECTION 11.08 Tax Redemption............................................. 112
SECTION 11.09 Purchase of Notes.......................................... 113
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ARTICLE XII
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 12.01 Company's Option to Effect
Defeasance or Covenant Defeasance..................................... 113
SECTION 12.02 Defeasance and Discharge................................... 113
SECTION 12.03 Covenant Defeasance........................................ 114
SECTION 12.04 Conditions to Defeasance or Covenant Defeasance............ 114
SECTION 12.05 Deposited Money and U.S. Government Securities to be Held
in Trust: Other Miscellaneous Provisions.............................. 116
SECTION 12.06 Reinstatement.............................................. 116
ARTICLE XIII
GUARANTEE OF NOTES
SECTION 13.01 Guarantee.................................................. 117
SECTION 13.02 Execution and Delivery of Guarantee........................ 118
SECTION 13.03 Limitation of Guarantee.................................... 118
SECTION 13.04 Additional Guarantors...................................... 119
SECTION 13.05 Release of Guarantor....................................... 119
SECTION 13.06 Waiver of Subrogation...................................... 119
ANNEXES
Annex A Form of Regulation S Certificate A-l
Annex B Form of Restricted Securities Certificate B-l
Annex C Form of Guarantee C-l
viii
THIS INDENTURE, dated as of March 23, 2004, among Norske Skog Canada
Limited, a corporation incorporated under the laws of Canada, as issuer (herein
called the "Company"), the Guarantors (as defined herein) and Wells Fargo Bank,
National Association, a national banking association, as Trustee (herein called
the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of its 7-3/8%
Senior Notes Due March 1, 2014 of substantially the tenor and amount hereinafter
set forth (the "Notes"), and to provide therefor the Company has duly authorized
the execution and delivery of this Indenture. The Securities may consist of
either or both Notes or Exchange Securities each as defined herein. The Notes
and the Exchange Securities shall rank pari passu with one another and will vote
as one series of Securities under this Indenture.
All things necessary to make the Securities, when executed by the
Company and authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company, and to make this Indenture a
valid agreement of the Company, in accordance with their and its terms, have
been done.
Upon the effectiveness of an effective registration statement under
the Securities Act, this Indenture will be subject to, and shall be governed by,
applicable provisions of the Trust Indenture Act.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Securities, as follows:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01 Definitions.
(a) For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined herein include the plural as well as the
singular and where the use of a word implies a gender, the word shall apply
to all genders;
(2) all other terms used herein which are defined in the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), either
directly or by reference therein, have the meanings assigned to them
therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP (whether or not such is
indicated herein), and, except as otherwise herein expressly provided, the
term "generally accepted accounting
1
principles" or "GAAP" with respect to any computation required or permitted
hereunder shall mean such accounting principles as are generally accepted
in Canada as consistently applied by the Company at the date of such
computation;
(4) unless the context otherwise requires, any reference to an
"Article" or a "Section", or to an "Annex" or a "Schedule", refers to an
Article or Section of, or to an Annex or a Schedule attached to, this
Indenture, as the case may be;
(5) unless the context otherwise requires, any reference to a statute,
rule or regulation refers to the same (including any successor statute,
rule or regulation thereto) as it may be amended from time to time;
(6) a term has the meaning assigned to it herein, whether defined
expressly or by reference;
(7) "or" is not exclusive;
(8) "U.S. Dollars", "United States Dollars" and "US$" each refer to
United States Dollars, or such other money of the United States that at the
time of payment is legal tender for payment of public and private debts;
and "$" and "Cdn$" each refer to Canadian Dollars, or such other money of
Canada that at the time of payment is legal tender for payment of public
and private debts;
(9) whenever in this Indenture there is mentioned, in any context,
principal, interest or any other amount payable under or with respect to
any Note, such mention shall be deemed to include mention of the payment of
Additional Interest to the extent that, in such context, Additional
Interest is, was or would be payable in respect thereof;
(10) unless otherwise specifically set forth herein, all calculations
or determinations of a Person shall be performed or made on a consolidated
basis in accordance with GAAP; and
(11) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
(b) Certain terms are defined as follows:
"Accounts Receivable" of a Person means all of the accounts receivable
of such Person whether now existing or existing in the future.
"Acquired Debt" means Debt of a Person or any of its Subsidiaries
existing at the time such Person becomes a Restricted Subsidiary or is merged or
amalgamated with or into or consolidated with the Company or a Restricted
Subsidiary or which is assumed in connection with the acquisition of assets from
such Person and, in each case, not incurred by such Person in connection with,
or in anticipation or contemplation of, such Person becoming a Restricted
Subsidiary or such merger, amalgamation, consolidation or acquisition.
2
"Additional Amounts" has the meaning specified in Section 10.16.
"Additional Interest" means additional interest on the Notes which the
Company and any Guarantors, jointly and severally, agree to pay to the Holders
pursuant to Section 2(e) of the Registration Rights Agreement.
"Affiliate" means, with respect to any specific Person, any other
Person (including, without limitation, such Person's issue, siblings and spouse)
that directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with such specified Person; provided
that, for purposes of this Indenture, the term "Affiliate" shall not include
Norske Skogindustrier ASA or its Affiliates. For the purposes of this
definition, "control" (including, with correlative meanings, the terms
"controlling," "controlled by" and "under common control with"), as used with
respect to any Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of such
Person, whether through the ownership of voting securities, by agreement or
otherwise; provided that, for purposes of Section 10.09 hereof, beneficial
ownership of at least 10% of the voting securities of a Person, either directly
or indirectly, shall be deemed to be control.
"Agent" means any Security Registrar, Paying Agent or agent for
service of process.
"Agent Members" has the meaning specified in Section 3.07(b)(2)(i).
"Applicable Procedures" has the meaning specified in Section
3.07(b)(2)(i).
"Asset Acquisition" means (i) an Investment by the Company or any
Restricted Subsidiary in any other Person pursuant to which such Person becomes
a Restricted Subsidiary, or shall be merged or amalgamated with or into the
Company or any Restricted Subsidiary or (ii) the acquisition by the Company or
any Restricted Subsidiary of the assets of any Person (other than a Restricted
Subsidiary) which constitute all or substantially all of the assets of such
Person or comprise any division or line of business of such Person or any other
properties or assets of such Person other than in the ordinary course of
business.
"Asset Sale" means any direct or indirect sale, issuance, conveyance,
assignment, transfer, lease (other than operating leases entered into in the
ordinary course of business) or other disposition (including pursuant to any
Sale and Lease-Back Transaction), other than to the Company or any of its
Restricted Subsidiaries, in any single transaction or series of related
transactions of:
(1) any Capital Stock of any Restricted Subsidiary or
(2) any other property or assets (including any interest therein) of
the Company or of any Restricted Subsidiary outside of the ordinary course
of business;
provided that Asset Sales shall not include:
3
(a) a transaction or series of related transactions for which the
Company or its Restricted Subsidiaries receive aggregate consideration
of less than $5,000,000 (provided that the Company or such Restricted
Subsidiary received consideration equal to the Fair Market Value of
any such property or assets so sold, conveyed, assigned, transferred,
leased or otherwise disposed of),
(b) the sale, lease, conveyance, disposition or other transfer of
all or substantially all of the assets of the Company as permitted
under Section 8.01 hereof,
(c) sales, transfers or other dispositions of property or
equipment that has become worn out, obsolete or damaged or otherwise
unsuitable for use in connection with the business of the Company or
any Restricted Subsidiary, as the case may be,
(d) the sale of inventory in the ordinary course of business,
(e) sales, transfers or other dispositions of assets of the
Company or its Restricted Subsidiaries, provided that the aggregate
Fair Market Value of all such assets shall not exceed $5,000,000,
(f) the sale of Accounts Receivable without recourse to the
Company or any Restricted Subsidiary at no more than customary
discounts in the market for such sales of Receivables of similar
quality,
(g) any Restricted Payment made in compliance with Section 10.07
hereof,
(h) the surrender or waiver of contract rights or the settlement,
release or surrender of contract, tort or other claims of any kind,
(i) the granting of Liens not prohibited by this Indenture, and
(j) the liquidation of Cash Equivalents in the ordinary course of
business.
"Asset Sale Proceeds" means, with respect to any Asset Sale,
(1) cash or Cash Equivalents received by the Company or any Restricted
Subsidiary from such Asset Sale, after:
(a) provision for all income or other taxes measured by or
resulting from such Asset Sale,
(b) payment of all brokerage commissions, underwriting and other
fees and expenses, including, without limitation, legal, accounting
and appraisal fees, related to such Asset Sale,
4
(c) provision for minority interest holders in any Restricted
Subsidiary as a result of such Asset Sale, and
(d) deduction of appropriate amounts to be provided by the
Company or a Restricted Subsidiary as a reserve, in accordance with
GAAP, against any liabilities associated with the assets sold or
disposed of in such Asset Sale and retained by the Company or a
Restricted Subsidiary after such Asset Sale, including, without
limitation, pension and other post-employment benefit liabilities and
liabilities related to environmental matters or against any
indemnification obligations associated with the assets sold or
disposed of in such Asset Sale, and
(2) promissory notes and other non-cash consideration received by the
Company or any Restricted Subsidiary from such Asset Sale or other
disposition upon the liquidation or conversion of such notes or non-cash
consideration into cash.
"Attributable Debt" in respect of a Sale and Lease-Back Transaction
means, as at the time of determination, the present value (discounted according
to GAAP at the cost of indebtedness implied in the Sale and Lease-Back
Transaction) of the total obligations of the lessee for minimum rental payments
during the remaining term of the lease included in such Sale and Lease-Back
Transaction (including any period for which such lease has been extended).
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 6.14 to act on behalf of the Trustee to authenticate
Securities.
"Available Asset Sale Proceeds" means, with respect to any Asset Sale,
the aggregate Asset Sale Proceeds from such Asset Sale that have not been
applied in accordance with clause (3)(A) or (3)(B) of Section 10.10(a), and that
have not yet been the basis for an Excess Proceeds Offer in accordance with
Section 10.10(a) hereof.
"Bankruptcy Law" means Title 11, U.S. Code, the Bankruptcy and
Insolvency Act (Canada), the Companies' Creditors Arrangement Act (Canada) or
any similar United States or Canadian federal, state or provincial law for the
relief of debtors.
"Board of Directors" means as to any Person, the board of directors of
such Person and any duly authorized committee thereof.
"Board Resolution" means a copy of a resolution certified by Officers'
Certificate to have been duly adopted by the Board of Directors of the Company
or a Guarantor, as appropriate, and to be in full force and effect on the date
of such certification, and delivered to the Trustee.
"Business Day" means a day that is not a Legal Holiday.
"Capital Contribution" means any cash contribution to the equity of
the Company from a direct or indirect parent of the Company or from another
shareholder for which no consideration other than the issuance of Capital Stock
(other than Disqualified Capital Stock) is given.
5
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated and whether
or not voting) of corporate stock, shares, partnership interests or any other
participation, right or other interest in the nature of an equity interest in
such Person including, without limitation, Common Stock and Preferred Stock of
such Person, or any option, warrant or other security convertible into any of
the foregoing.
"Capitalized Lease Obligations" means, with respect to any Person,
Debt represented by obligations under a lease that is required to be capitalized
for financial reporting purposes in accordance with GAAP, and the amount of such
Debt shall be the capitalized amount of such obligations determined in
accordance with GAAP.
"Cash Equivalents" means
(1) Canadian or U.S. dollars;
(2) marketable direct obligations issued by, or unconditionally
guaranteed by, the federal government of the United States of America or
Canada, respectively, or issued by any agency thereof and backed by the
full faith and credit of the federal government of the United States of
America or Canada, respectively, in each case maturing within one year from
the date of acquisition thereof;
(3) marketable direct obligations issued by any state of the United
States of America or any province of Canada or any political subdivision of
any such state or province, as the case may be, or any public
instrumentality thereof maturing within one year from the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from either S&P or Moody's; provided that, in
the event that any such obligation is not rated by S&P or Moody's, such
obligation shall have the highest rating from DBRS;
(4) commercial paper maturing no more than one year from the date of
creation thereof and, at the time of acquisition, having a rating of at
least R-l (low) from DBRS or A-2 from S&P or P-2 from Moody's;
(5) overnight deposits, certificates of deposit or bankers'
acceptances maturing within one year from the date of acquisition thereof
issued by any bank organized under the laws of the United States of America
or Canada or any state or province, as the case may be, thereof or the
District of Columbia or any U.S. or Canadian branch of a foreign bank
having at the date of acquisition thereof combined capital and surplus of
not less than US$250,000,000;
(6) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clause (2) of this
definition entered into with any bank meeting the qualifications specified
in clause (5) of this definition; and
(7) investments in money market funds which invest substantially all
their assets in securities of the types described in clauses (1) through
(6) of this definition.
6
A "Change of Control" of the Company shall be deemed to have occurred
at such time as:
(1) any Person or group of related Persons for purposes of Section
13(d) of the Exchange Act ("Group") becomes the beneficial owner (as
defined under Rule 13d-3 or any successor rule or regulation promulgated
under the Exchange Act), directly or indirectly, of 50% or more of the
total voting power of the Common Stock of the Company,
(2) there shall be consummated any consolidation or merger or
amalgamation of the Company in which the Company is not the continuing or
surviving corporation or pursuant to which the Common Stock of the Company
would be converted into cash, securities or other property, other than a
merger or consolidation or amalgamation of the Company in which the holders
of the Common Stock of the Company outstanding immediately prior to the
consolidation or merger or amalgamation hold, directly or indirectly, at
least a majority of the Common Stock of the surviving corporation
immediately after such consolidation or merger or amalgamation, or
(3) the first day on which a majority of the members of the Board of
Directors of the Company are not Continuing Directors.
"Change of Control Triggering Event" means the occurrence of both a
Change of Control and a Rating Decline.
"Clearstream" has the meaning specified in Section 2.05.
"Commission" means the U.S. Securities and Exchange Commission.
"Commodity Agreement" means any commodity forward contract, commodity
futures contract, commodity swap, commodity option or other similar agreement or
arrangement entered into by the Company or any Restricted Subsidiary.
"Common Stock" of any Person means all Capital Stock of such Person
that is generally entitled to (i) vote in the election of directors of such
Person or (ii) if such Person is not a corporation, vote or otherwise
participate in the selection of the governing body, partners, managers or others
that will control the management and policies of such Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by any one of the Chairman of the Board of
Directors, Chief Executive Officer, President, any Vice President, Chief
Financial Officer, Controller or Treasurer of the Company, and attested to by
the Corporate Secretary or any Assistant Secretary of the Company.
"Consolidated Fixed Charge Coverage Ratio" means, at any date of
determination, with respect to any Person, the ratio of EBITDA of such Person to
Consolidated Fixed Charges of such Person for the Four-Quarter Period.
7
In addition to and without limitation of the foregoing, for purposes
of this definition, "EBITDA" and "Consolidated Fixed Charges" shall be
calculated after giving effect on a pro forma basis to:
(1) the incurrence or repayment of any Debt of such Person or any of
its Restricted Subsidiaries (and the application of the proceeds thereof)
giving rise to the need to make such calculation;
(2) any incurrence or repayment of other Debt (and the application of
the proceeds thereof), occurring on or after the first day of the
Four-Quarter Period and on or prior to the date of determination, as if
such incurrence or repayment, as the case may be (and the application of
the proceeds thereof), occurred on the first day of such Four-Quarter
Period; and
(3) any Asset Sales or Asset Acquisitions (including, without
limitation, any Asset Acquisition giving rise to the need to make such
calculation as a result of the Company or a Restricted Subsidiary
(including any Person who becomes a Restricted Subsidiary as a result of
the Asset Acquisition) incurring, assuming or otherwise being liable for
Acquired Debt and also including any increase or decrease, as the case may
be, in EBITDA (including any pro forma cost reductions calculated on a
basis consistent with Regulation S-X under the Securities Act) directly
attributable to the assets which are the subject of the Asset Sale or Asset
Acquisition during the Four-Quarter Period) occurring on or after the first
day of the Four-Quarter Period and on or prior to the date of
determination, as if such Asset Sale or Asset Acquisition (including the
incurrence, assumption or liability for any such Acquired Debt) occurred on
the first day of such Four-Quarter Period.
"Consolidated Fixed Charges" means, with respect to any Person, for
any period, the sum, without duplication, of (i) Consolidated Interest Expense,
plus (ii) the amount of all dividend payments (to any Person other than the
Company or a Restricted Subsidiary) on any series of Disqualified Capital Stock
of such Person (other than dividends paid in Capital Stock (other than
Disqualified Capital Stock)) paid, accrued or scheduled to be paid or accrued
during such period, plus (iii) the amount of all cash dividend payments (to any
Person other than the Company or a Restricted Subsidiary) on any series of
Preferred Stock (other than Disqualified Capital Stock) of such Person paid
during such period, in each case, on a consolidated basis in accordance with
GAAP.
"Consolidated Interest Expense" means, with respect to any Person, for
any period, the sum, without duplication, of:
(1) the aggregate amount of interest charges (excluding (a) fees
and expenses incurred in connection with any Debt incurred pursuant to
Section 10.06, including, but not limited to, any Permitted Debt, any Debt
outstanding on the Issue Date and the Notes, (b) the amortization of any
deferred gains or losses in respect of Debt denominated in foreign currency
as a result of fluctuations in exchange rates and (c) any premium paid, or
fees and expenses incurred, in connection with the redemption, repurchase
or retirement of any Debt of that Person or its Restricted Subsidiaries
prior to
8
the stated maturity thereof), whether expensed or capitalized, incurred or
accrued by that Person and its Restricted Subsidiaries, determined on a
consolidated basis in accordance with GAAP for such period (including
non-cash interest payments); plus,
(2) to the extent not included in clause (1) of this definition,
an amount equal to the sum of:
(A) imputed interest included in Capitalized Lease Obligations;
(B) the net costs associated with Interest Rate Agreements,
Currency Agreements and other hedging obligations;
(C) the interest portion of any deferred payment obligations;
(D) amortization of discount or premium on Debt, if any;
(E) all capitalized interest and all accrued interest;
(F) all other non-cash interest expense;
(G) all interest incurred or paid under any guarantee of Debt
(including a guarantee of principal, interest or any
combination thereof) of any Person; and
(H) the amount of all payments charged to shareholders equity on
any "compound financial instrument" (as described under
GAAP) paid, accrued or scheduled to be paid or accrued
during such period.
For purposes of calculating Consolidated Interest Expense on a pro
forma basis:
(1) interest on Debt bearing a floating rate of interest shall be
calculated using the interest rate in effect at the time of determination,
taking into account on a pro forma basis any Interest Rate Agreement
applicable to such Debt if such Interest Rate Agreement has a remaining
term at the date of determination of at least 12 months; and
(2) if Debt was incurred under a revolving credit facility, the
interest expense on such Debt shall be calculated based upon the average
daily balance of such Debt during the applicable period.
"Consolidated Leverage Ratio" means, at any date of determination,
with respect to any Person, the ratio of the total Debt of such Person at such
date of determination to the EBITDA of such Person for the Four-Quarter Period.
In addition to and without limitation of the foregoing, for purposes
of this definition, "EBITDA" and "total Debt" shall be calculated after giving
effect on a pro forma basis to:
9
(1) the incurrence or repayment of any Debt of such Person or any of
its Restricted Subsidiaries (and the application of the proceeds thereof)
giving rise to the need to make such calculation;
(2) any incurrence or repayment of other Debt (and the application of
the proceeds thereof), occurring on or after the first day of the
Four-Quarter Period and on or prior to the date of determination, as if
such incurrence or repayment, as the case may be (and the application of
the proceeds thereof), occurred on the first day of such Four-Quarter
Period; and
(3) any Asset Sales or Asset Acquisitions (including, without
limitation, any Asset Acquisition giving rise to the need to make such
calculation as a result of the Company or a Restricted Subsidiary
(including any Person who becomes a Restricted Subsidiary as a result of
the Asset Acquisition) incurring, assuming or otherwise being liable for
Acquired Debt and also including any increase or decrease, as the case may
be, in EBITDA (including any pro forma cost reductions calculated on a
basis consistent with Regulation S-X under the Securities Act) directly
attributable to the assets which are the subject of the Asset Sale or Asset
Acquisition during the Four-Quarter Period) occurring on or after the first
day of the Four-Quarter Period and on or prior to the date of
determination, as if such Asset Sale or Asset Acquisition (including the
incurrence, assumption or liability for any such Acquired Debt) occurred on
the first day of such Four-Quarter Period.
"Consolidated Net Income" means, with respect to any 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, to the extent included in calculating Net Income of
such Person,
(1) the Net Income of any other Person that is not a Restricted
Subsidiary of the Person in question, shall be excluded, except to the
extent of the amount of cash dividends or distributions actually received
by such Person or a Restricted Subsidiary of such Person,
(2) the Net Income (but not loss) of any Restricted Subsidiary of
the Person in question that is subject to any restriction or limitation on
the payment of dividends or the making of other distributions (other than
pursuant to the Notes or this Indenture or pursuant to a restriction or
limitation of the type described in clause (c)(2) of Section 10.12) shall
be excluded to the extent of such restriction or limitation,
(3) (a) the Net Income of any Person acquired in a "pooling of
interests" transaction for any period prior to the date of such acquisition
shall be excluded and (b) any net after-tax gain (but not loss) resulting
from an Asset Sale by the Person in question or any of its Restricted
Subsidiaries other than in the ordinary course of business shall be
excluded,
(4) after-tax items classified as extraordinary or unusual gains
or losses and any foreign exchange gains and losses shall be excluded,
10
(5) any restoration to income or any contingency reserve of an
extraordinary, non-recurring or unusual nature shall be excluded, and
(6) in the case of a successor to such Person by consolidation or
merger or amalgamation or as a transferee of such Person's assets, any
earnings of the successor corporation prior to such consolidation, merger
or amalgamation or transfer of assets shall be excluded if and to the
extent such corporation was not subject to this Indenture.
"Continuing Director" means, with respect to the Company, as of any
date of determination, any member of the Board of Directors of the Company (i)
who was a member of the Board of Directors of the Company on the Issue Date or
(ii) whose appointment or election was approved by the affirmative vote of a
majority of the Continuing Directors who were members of the Board of Directors
of the Company at the time of such director's nomination or election.
"Corporate Trust Office" means the office of the Trustee or its
affiliate at which at any particular time its corporate trust business may be
administered and any additional office it may designate in writing to the
Company. At the date of this Indenture, the Corporate Trust Office of the
Trustee is 213 Court Street, Suite 703, Middletown, CT 06457, Attention:
Corporate Trust Services.
"corporation" means a corporation, association, company, joint-stock
company, limited liability company and, where the context requires, includes a
partnership or business trust.
"Credit Facilities" means, collectively, any credit facilities, letter
of credit or other borrowing or lending arrangements of the Company and/or the
Guarantors together with the related documents thereto (including, without
limitation, any loan agreements, note purchase agreements, indentures, notes,
guarantee agreements, collateral documents, mortgages, instruments and security
documents executed in connection therewith), in each case as any such agreements
or arrangements may be amended (including any amendment and restatement
thereof), supplemented or otherwise modified from time to time, in each case,
including, without limitation, any credit facility, letter of credit, agreement,
indenture, notes, other documents or instruments or other arrangement extending
the maturity of, refinancing, replacing or otherwise restructuring (including
adding Subsidiaries of the Company as additional borrowers or guarantors
thereunder) all or any portion of the Debt under such agreements or
arrangements, together with any successor or replacement agreements or other
arrangements, and whether by or with the same or any other agent, lender or
group of lenders or other institutions providing credit.
"Currency Agreement" means any foreign exchange contract, currency
swap agreement or other similar agreement or arrangement designed to protect the
Company or any Restricted Subsidiary of the Company against fluctuations in
currency values.
"DBRS" means Dominion Bond Rating Service Limited and its successors.
"Debt" means (without duplication, including, without limitation,
duplication arising or existing because a Person and one or more of its
subsidiaries are or will become either
11
directly or indirectly liable for the same Debt whether by virtue of guarantees,
or joint, or joint and several liability in respect of such Debt or otherwise),
with respect to any Person, any indebtedness at any time outstanding, secured or
unsecured, contingent or otherwise, which is for borrowed money (whether or not
the recourse of the lender is to the whole of the assets of that Person or only
to a portion of the assets of that Person), or evidenced by bonds, notes,
debentures or similar instruments or representing the balance deferred and
unpaid of the purchase price of any property (excluding, without limitation, any
balances that constitute accounts payable or trade payables, and other accrued
liabilities arising in the ordinary course of business) if and to the extent any
of the foregoing indebtedness would appear as a liability upon a balance sheet
of that Person prepared in accordance with GAAP, and will also include, to the
extent not otherwise included:
(1) Capitalized Lease Obligations of that Person;
(2) obligations secured by a Lien (other than obligations under
Interest Rate Agreements, Currency Agreements or Commodity Agreements) to
which any property or assets owned or held by that Person are subject,
whether or not the obligation or obligations secured thereby will have been
assumed by a third party, provided that, for the purposes of determining
the amount of Debt described in this clause, if recourse with respect to
that Debt is limited to such property or assets, the amount of that Debt
will be deemed to be the Fair Market Value of such property or assets;
(3) guarantees of items of other Persons which would be included
within this definition for that other Person (whether or not such items
would appear upon the balance sheet of the guarantor);
(4) obligations of that Person for the reimbursement of any obligor on
any letter of credit, banker's acceptance or similar credit transaction;
(5) all Disqualified Capital Stock issued by that Person with the
amount of Debt represented by that Disqualified Capital Stock being equal
to the greater of its voluntary or involuntary liquidation preference and
its maximum fixed repurchase price (for the purposes hereof, "maximum fixed
repurchase price" of any Disqualified Capital Stock which does not have a
fixed repurchase price shall be calculated in accordance with the terms of
that Disqualified Capital Stock as if that Disqualified Capital Stock were
repurchased on any date on which Debt shall be required to be determined
pursuant to this Indenture and if that price is based upon, or measured by,
the fair market value of that Disqualified Capital Stock, that price shall
be the Fair Market Value of that Disqualified Capital Stock);
(6) obligations of that Person under any Currency Agreement or any
Interest Rate Agreement applicable to any of the foregoing (if and to the
extent such Currency Agreement or Interest Rate Agreement obligations would
appear as a liability upon a balance sheet of that Person prepared in
accordance with GAAP);
12
(7) obligations of that Person under any Commodity Agreement (if and
to the extent such Commodity Agreement obligations would appear as a
liability upon a balance sheet of that Person prepared in accordance with
GAAP); and
(8) Attributable Debt.
The amount of Debt of any Person at any date will be the outstanding
balance at such date of all unconditional obligations as described above and,
with respect to contingent obligations (other than contingent obligations under
Interest Rate Agreements, Currency Agreements and Commodity Agreements, which
shall be valued as set forth above), the maximum liability upon the occurrence
of the contingency giving rise to the obligation; provided that:
(1) the amount outstanding at any time of any Debt issued with
original issue discount is the accreted value of that Debt at that time as
determined in conformity with GAAP; and
(2) Debt will not include any liability for federal, provincial,
state, local or other taxes.
Notwithstanding any other provision of the foregoing definition, any
trade payable, deferred credit or accrued liability arising from the purchase of
goods or materials or for services obtained in the ordinary course of business
shall not be deemed to be Debt of the Company or any of its Restricted
Subsidiaries for purposes of this definition. Furthermore, guarantees of (or
obligations with respect to letters of credit supporting) Debt otherwise
included in the determination of that amount shall also not be included.
"Default" means any event that is, or with the passing of time or
giving of notice or both would be, an Event of Default.
"Defaulted Interest" has the meaning specified in Section 3.1l(b).
"Designation" means the designation of any Subsidiary of the Company
as an Unrestricted Subsidiary.
"Designation Amount" shall have the meaning set forth in the
definition of "Restricted Payment."
"Disqualified Capital Stock" means any Capital Stock of a Person or a
Restricted Subsidiary thereof which, by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable at the
option of the holder), or upon the happening of any event, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
is redeemable at the option of the holder thereof (except, in each case, in
accordance with a change of control provision, which provision has substantially
the same effect as Section 10.15 hereof), in whole or in part, or is
exchangeable into Debt on or prior to the final maturity date of the Notes.
"DTC" means The Depository Trust Company, its nominee or successor.
13
"EBITDA" means, with respect to any Person and its Restricted
Subsidiaries, for any period, an amount equal to
(1) the sum, without duplication, of:
(a) Consolidated Net Income for such period, minus any net income
(or plus any net loss) attributable to discontinued operations
(including, without limitation, operations disposed of during such
period whether or not such operations were classified as
discontinued), plus
(b) the provision for taxes for such period based on income or
profits to the extent such income or profits were included in
computing Consolidated Net Income (minus any provision for taxes
utilized in computing net loss under clause (1)(a) of this definition
to the extent such provision reduced net loss), plus
(c) Consolidated Interest Expense for such period, plus
(d) depreciation for such period on a consolidated basis, to the
extent reducing Consolidated Net Income, plus
(e) amortization of goodwill, deferred charges and other
intangibles for such period on a consolidated basis, to the extent
reducing Consolidated Net Income, plus
(f) any other non-cash items reducing Consolidated Net Income for
such period, minus
(2) all non-cash items increasing Consolidated Net Income for such
period, determined on a consolidated basis in accordance with GAAP.
"Euroclear" has the meaning specified in Section 2.05.
"Event of Default" has the meaning specified in Section 5.01.
"Exchange Act" refers to the U.S. Securities Exchange Act of 1934 as
it may be amended, any successor act thereto and the rules and regulations of
the Commission promulgated thereunder.
"Exchange Securities" has the meaning provided in the Registration
Rights Agreement.
"Excluded Holder" has the meaning specified in Section 10.16(a).
"Expiration Date" has the meaning specified in Section 1.04(g).
"Fair Market Value" means, with respect to any asset or property, the
price which could be negotiated in an arm's-length, free market transaction, for
cash, between a willing seller and a willing and able buyer, neither of whom is
under undue pressure or compulsion to
14
complete the transaction. Fair Market Value shall be determined by the Board of
Directors of the Company acting reasonably and in good faith and, in the case of
determination involving assets or property in excess of $5,000,000 shall be
evidenced by a Board Resolution.
"Four-Quarter Period" means at any date of determination the four most
recent consecutive fiscal quarters for which consolidated financial statements
are available ending on or prior to the date of such determination.
"Global Note" and "Global Security" mean a Restricted Global Security
or Regulation S Global Security.
"Guarantee" means a guarantee of the Notes by a Guarantor issued
pursuant to the terms of this Indenture.
"Guarantors" means all of the Restricted Subsidiaries of the Company
that hereafter become Guarantors pursuant to this Indenture.
"Holder" means a person in whose name a Security is registered in the
Security Register.
"incur" means, with respect to any Debt or other obligation of any
Person, to create, issue, incur (by conversion, exchange or otherwise), assume,
guarantee or otherwise become liable in respect of such Debt or other obligation
or the recording, as required pursuant to GAAP or otherwise, of any such Debt or
other obligation on the balance sheet of such Person (and "incurrence",
"incurred", "incurrable" and "incurring" shall have meanings correlative to the
foregoing); provided, that a change in GAAP that results in an obligation of
such Person that exists at such time becoming Debt shall not be deemed an
incurrence of such Debt.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof
including, for all purposes of this instrument and any such supplemental
indenture, the Annexes attached to this instrument.
"Independent Financial Advisor" means an investment banking firm or
accounting firm of national reputation in the United States of America or Canada
(i) which does not, and whose directors, officers, employees and Affiliates do
not, have a direct or indirect financial interest in the Company or any of its
Affiliates, and (ii) which, in the judgment of the Board of Directors of the
Company, is otherwise independent and qualified to perform the task for which it
is to be engaged.
"Initial Purchasers" means Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Banc of America Securities LLC, CIBC World Markets Corp., Scotia
Capital (USA) Inc., RBC Capital Markets Corporation, TD Securities (USA), Inc.,
Harris Nesbitt Corp., HSBC Securities (USA) Inc. and NBF Securities (USA) Corp.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(l), (2), (3) or (7)
promulgated under the Securities Act.
15
"Interest Payment Date" means each semiannual interest payment date on
March 1 and September 1 of each year, commencing September 1, 2004.
"Interest Rate Agreement" means, with respect to any Person, any
interest rate protection agreement, interest rate futures agreement, interest
rate swap agreement, interest rate cap agreement, interest rate collar
agreement, interest rate forward agreement or other similar agreement or
arrangement.
"Inventory" of a Person means all inventory of such Person, including
(i) all raw materials, work in process, parts, components, assemblies, supplies
and materials used or consumed by such Person's business, (ii) all goods, wares
and merchandise, finished or unfinished, held for sale or lease and (iii) all
goods returned or repossessed by such Person.
"Investment Grade" means (i) BBB- or above, in the case of S&P (or its
equivalent under any successor Rating Categories of S&P), or Baa3 or above, in
the case of Moody's (or its equivalent under any successor Rating Categories of
Moody's), or (ii) the equivalent in respect of the Rating Categories of any
Rating Agencies substituted for S&P or Moody's.
"Investments" means (without duplication), with respect to any Person,
directly or indirectly, any advance (or other extension of credit), account
receivable (other than an account receivable arising in the ordinary course of
business of such Person), loan or capital contribution to (by means of
transfers, of cash or other Property to others, payments for Property or
services for the account or use of others or otherwise), any guarantee of any
obligations or Debt of any other Person, the purchase of any Capital Stock,
bonds, notes, debentures, partnership or joint venture interests or other
securities of, the acquisition, by purchase or otherwise, of all or
substantially all of the business or assets or stock or other evidence of
beneficial ownership of, or interest in any Person or the making of any
investment in any Person. Investments shall exclude (i) extensions of trade
credit to customers and advances in respect of commissions and travel and
similar expenses to officers and employees, in each case made in the ordinary
course of business and (ii) the repurchase of securities of any Person by such
Person. For the purposes of Section 10.07 hereof, the amount of any Investment
shall be the original cost of such Investment plus the cost of all additional
Investments by the Company or any of its Restricted Subsidiaries, without any
adjustments for increases or decreases in value, or write-ups, write-downs or
write-offs with respect to such Investment, reduced by the payment of dividends
or distributions in connection with such Investment or any other amounts
received in respect of such Investment; provided that no such payment of
dividends or distributions or receipt of any such other amounts shall reduce the
amount of any Investment if such payment of dividends or distributions or
receipt of any such amounts would be included in Consolidated Net Income. In
determining the amount of any Investment involving the transfer of any property
or assets other than cash, such property or assets shall be valued at its or
their Fair Market Value at the time of such transfer, as determined in good
faith by the Board of Directors of the Person making such transfer.
"Issue Date" means the date the Notes are first issued by the Company
and authenticated by the Trustee under this Indenture.
16
"Lien" means, with respect to any property or assets of any Person,
any mortgage or deed of trust, pledge, hypothecation, assignment, deposit
arrangement, security interest, lien, charge, easement, encumbrance, priority or
other security agreement of any kind or nature whatsoever on or with respect to
such property or assets (including, without limitation, any Capitalized Lease
Obligations, conditional sales, or other title retention agreement having
substantially the same economic effect as any of the foregoing).
"Material Subsidiary" means, at any date of determination,
(1) any Restricted Subsidiary that, together with its Subsidiaries
that constitute Restricted Subsidiaries:
(a) for the most recent fiscal year of the Company accounted for
more than 5.0% of the consolidated revenues of the Company and the
Restricted Subsidiaries, or
(b) as of the end of such fiscal year, owned more than 5.0% of
the consolidated assets of the Company and the Restricted
Subsidiaries,
all as set forth on the consolidated financial statements of the Company
and the Restricted Subsidiaries for such year prepared in conformity with
GAAP, and
(2) any Restricted Subsidiary which, when aggregated with all other
Restricted Subsidiaries that are not otherwise Material Subsidiaries and as
to which any event described in clause (8) of Section 5.01(a) hereof has
occurred, would constitute a Material Subsidiary under clause (1) of this
definition.
"Maturity Date" means March 1, 2014.
"Moody's" means Moody's Investors Service, Inc. and its successors.
"Net Income" means, with respect to any Person, for any period, the
net income (loss) of such Person determined in accordance with GAAP and in
accordance with clause (6) of the definition of Consolidated Net Income.
"Non-U.S. Person" means a Person who is not a U.S. person, as defined
in Regulation S.
"Notes" means the 7-3/8% Senior Notes due 2014 issued by the Company
pursuant to this Indenture.
"Notice of Default" means a written notice of the kind specified in
Section 6.05.
"Officer" with respect to any Person (other than the Trustee), means
the Chairman of the Board of Directors, Chief Executive Officer, the President,
any Vice President, the Chief Financial Officer, the Controller, the Treasurer,
the Corporate Secretary or the Secretary of such Person, or any other officer of
such Person designated by the Board of Directors of such Person and set forth in
an Officers' Certificate delivered to the Trustee.
17
"Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chief Executive Officer, the President or any Vice
President, and the Chief Financial Officer, the Treasurer or the Corporate
Secretary, of such Person that shall comply with applicable provisions of this
Indenture.
"Opinion of Counsel" means a written opinion reasonably satisfactory
in form and substance to the Trustee from legal counsel, which counsel is
reasonably acceptable to the Trustee, including the matters required by Section
1.02 hereof and delivered to the Trustee.
"Other Senior Notes" means the 8-5/8% Senior Notes due 2011 issued by
the Company.
"Pacifica" means Pacifica Papers Inc., a Canadian company that
amalgamated with Norske Skog Canada Limited to form the Company on September 1,
2001.
"Pacifica Income Adjustment Amount" means the amount equal to 50% of
the cumulative Consolidated Net Income of Pacifica for the period from January
1, 1999 to September 1, 2001 (but not including any amount which is included in
determining Consolidated Net Income of the Company and its successors) less the
aggregate amount of any "Restricted Payments" (as such term is defined in the
indenture governing the Pacifica Notes, as such indenture was in effect on the
date the Pacifica Notes were originally issued, whether or not any of such
Pacifica Notes remain outstanding) made by Pacifica in that period that would be
required to be deducted in calculating the limitation on "Restricted Payments"
thereunder.
"Pacifica Notes" means the 10% Senior Notes due 2009 of Pacifica, and
assumed by the Company.
"pari passu", when used with respect to the ranking of any Debt of any
Person in relation to other Debt of such Person, means that each such Debt (a)
either (i) is not subordinated in right of payment to any other Debt of such
Person or (ii) is subordinate in right of payment to the same Debt of such
Person as is the other and is so subordinate to the same extent and (b) is not
subordinate in right of payment to the other or to any Debt of such Person as to
which the other is not so subordinate.
"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Securities on behalf of
the Company, which initially shall be the Trustee.
"Permitted Debt" means:
(1) Debt of the Company or a Guarantor arising under or in connection
with any Credit Facilities in an aggregate principal amount at any time
outstanding not to exceed the greater of:
(A) $725,000,000; and
(B) the sum of:
18
(i) 85.0% of the book value of Accounts Receivable net of
any allowance for doubtful accounts of the Company and its
Restricted Subsidiaries as of the last fiscal quarter for which
financial statements are prepared, plus
(ii) 60.0% of the book value of Inventory at the lower of
cost or net realizable value net of any allowance for
obsolescence of the Company and its Restricted Subsidiaries as of
the last fiscal quarter for which financial statements are
prepared, plus
(iii) $375,000,000;
(2) Debt under the Notes and any Guarantees;
(3) Debt of the Company owed to and held by any Guarantor which is
unsecured and subordinated in right of payment to the payment and
performance of the Company's obligations under this Indenture and the Notes
and Debt of any Restricted Subsidiary owed to and held by the Company or
another Guarantor; provided that:
(A) any sale or other disposition of any Debt of the Company or
any Restricted Subsidiary referred to in this clause (3) to a Person
other than the Company or a Guarantor,
(B) any sale or other disposition of Capital Stock of any
Guarantor which holds Debt of the Company or another Restricted
Subsidiary such that such Guarantor ceases to be a Guarantor of the
Company, and
(C) the Designation of a Guarantor that holds Debt of the Company
or any other Restricted Subsidiary as an Unrestricted Subsidiary,
shall be deemed to be an incurrence of Debt not constituting Permitted Debt
by the issuer of that Debt;
(4) Purchase Money Debt and Capitalized Lease Obligations incurred to
acquire property in the ordinary course of business in an aggregate
principal amount outstanding not to exceed, together with all other Debt
outstanding under this clause (4), at the time of any such incurrence and
after giving pro forma effect thereto, 7.5% of the consolidated tangible
assets of the Company and its Restricted Subsidiaries as of the end of the
most recent fiscal quarter for which consolidated financial statements are
available ending on or prior to the date of determination;
(5) Debt under Interest Rate Agreements entered into in the ordinary
course of business of the Company or any Restricted Subsidiary and not for
speculative purposes; provided that the notional principal amount of such
Interest Rate Agreements, at the time of the incurrence thereof, does not
exceed the principal amount of the Debt to which such Interest Rate
Agreements relate;
19
(6) Debt under Currency Agreements entered into in the ordinary course
of business of the Company or any Restricted Subsidiaries and not for
speculative purposes; provided that in the case of Currency Agreements
which relate to Debt, such Currency Agreements do not increase the
principal amount of Debt of the Company and its Restricted Subsidiaries
outstanding other than as a result of fluctuations in foreign currency
exchange rates or by reason of fees, indemnities or compensation payable
thereunder;
(7) Debt of the Company or any Restricted Subsidiary in respect of
reimbursement obligations relating to undrawn standby letters of credit
issued for the account of the Company or such Restricted Subsidiary, as the
case may be, in connection with workers' compensation claims, self
insurance or other similar reimbursement type obligations;
(8) Debt of the Company or any Restricted Subsidiary in respect of
bid, performance, surety and appeal bonds provided in the ordinary course
of business;
(9) additional Debt of the Company or the Guarantors not to exceed
$100,000,000 in aggregate principal amount at any one time outstanding
which may, but need not be, incurred under the Credit Facilities;
(10) Refinancing Debt;
(11) Debt of the Company or any of its Restricted Subsidiaries in
respect of accommodation guarantees for the benefit of trade creditors of
any such person, trade letters of credit, standby letters of credit,
performance bonds, bankers' acceptances and surety bonds, in each case,
incurred in the ordinary course of business in an aggregate principal
amount not in excess of $5,000,000 at any one time outstanding;
(12) Debt outstanding on the Issue Date except for indebtedness
incurred pursuant to clause (1) or (2) of this definition;
(13) Debt under Commodity Agreements entered into in the ordinary
course of business and not for speculative purposes; and
(14) any Debt incurred by the Company or any Restricted Subsidiary to
the extent (i) (A) all of the net proceeds of such Debt are used to fully
or partially pay the consideration for any Asset Acquisition or (B) such
Debt constitutes Acquired Debt and (ii) after giving pro forma effect to
such incurrence and the related Asset Acquisition, (1) no Default or Event
of Default will have occurred and be continuing or result therefrom and (2)
the Company's Consolidated Leverage Ratio is equal to or lower than the
Company's Consolidated Leverage Ratio immediately prior to giving effect to
such incurrence and related Asset Acquisition.
"Permitted Investments" means Investments made on or after the Issue
Date consisting of:
20
(1) Investments by the Company, or by a Restricted Subsidiary thereof,
in the Company or a Restricted Subsidiary;
(2) Investments by the Company, or by a Restricted Subsidiary thereof,
in a Person, if as a result of that Investment
(A) that Person becomes a Restricted Subsidiary of the Company,
or
(B) that 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 thereof;
(3) Investments in Cash Equivalents;
(4) reasonable and customary loans and advances made to employees not
to exceed $10,000,000 in the aggregate at any one time outstanding;
(5) an Investment that is made by the Company or a Restricted
Subsidiary thereof in the form of any Capital Stock, bonds, notes,
debentures or other securities that are issued by a third party to the
Company or Restricted Subsidiary solely as partial consideration for the
consummation of an Asset Sale that is permitted under Section 10.10 of this
Indenture;
(6) Investments (including, but not limited to, Investments in
co-generation facilities) in Unrestricted Subsidiaries or in any
corporation, partnership, joint venture or other entity (including, but not
limited to, any entity engaged in the business of constructing and/or
operating co-generation or similar facilities) in an amount not to exceed,
together with the amount of all other Investments outstanding under this
clause (6), at the time of such Investment and after giving pro forma
effect thereto, 7.5% of the consolidated tangible assets of the Company and
its Restricted Subsidiaries as of the end of the most recent fiscal quarter
for which consolidated financial statements are available ending on or
prior to the date of determination (with the amount of each Investment
being measured at the time made and without giving effect to subsequent
changes in value);
(7) any acquisition of assets in exchange for the Capital Stock (other
than Disqualified Capital Stock) of the Company;
(8) Investments in securities of trade creditors or customers received
in settlement of obligations that arose in the ordinary course of business
pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of such trade creditors or customers;
(9) Investments in Commodity Agreements, Interest Rate Agreements and
Currency Agreements entered into in the ordinary course of business and not
for speculative purposes; and
(10) other Investments in any Person in an amount, together with the
amount of all other Investments outstanding under this clause (10), not to
exceed at the time of such
21
Investment, the greater of (A) $25,000,000 and (B) 2.0% of the consolidated
tangible assets of the Company and its Restricted Subsidiaries as of the
end of the most recent fiscal quarter for which consolidated financial
statements are available ending on or prior to the date of determination
(with the amount of each Investment being measured at the time made and
without giving effect to subsequent changes in value).
"Permitted Liens" means,
(1) Liens on Property or assets of, or any Capital Stock of, any
corporation existing at the time such assets are acquired by the Company or
any of its Restricted Subsidiaries, whether by merger, amalgamation,
consolidation, purchase of assets or otherwise; provided (a) that such
Liens are not created, incurred or assumed in connection with, or in
contemplation of, such assets being acquired by the Company or its
Restricted Subsidiaries and (b) that any such Lien does not extend to or
cover any Property, Capital Stock or Debt other than the Property, Capital
Stock or Debt being acquired,
(2) Liens securing Refinancing Debt; provided that any such Lien does
not extend to or cover any Property, Capital Stock or Debt other than the
Property, Capital Stock or Debt securing the Debt so refunded, refinanced
or extended,
(3) Liens in favor of the Company or any Guarantor,
(4) Liens to secure Purchase Money Debt that is otherwise permitted to
be incurred under this Indenture; provided that (a) any such Lien is
created solely for the purpose of securing Debt representing, or incurred
to finance, refinance or refund, the cost (including sales and excise
taxes, installation and delivery charges and other direct costs of, and
other direct expenses paid or charged in connection with, such purchase or
construction) of the Property so acquired, (b) the principal amount of the
Debt secured by such Lien does not exceed 100% of such costs and expenses,
and (c) such Lien does not extend to or cover any Property other than such
item of Property and any improvements on such item,
(5) statutory liens or landlords', carriers', warehousemen's,
unemployment insurance, surety or appeal bonds, mechanics', suppliers',
materialmen's, repairmen's or other like Liens imposed by law arising in
the ordinary course of business and with respect to amounts not yet
delinquent or being contested in good faith by appropriate proceedings,
(6) Liens existing on the Issue Date,
(7) Liens securing only the Notes or the Guarantees,
(8) Liens for taxes, assessments or governmental charges not yet due
or that are being contested in good faith by appropriate proceedings;
provided that any reserve or other appropriate provision as shall be
required in conformity with GAAP shall have been made therefor,
22
(9) Liens securing Capitalized Lease Obligations permitted to be
incurred under clause (4) of the definition of "Permitted Debt"; provided
that such Lien does not extend to any Property other than that subject to
the underlying lease,
(10) Liens securing Debt permitted to be incurred under clause (1) of
the definition of "Permitted Debt,"
(11) Liens securing obligations under Interest Rate Agreements,
Currency Agreements and Commodity Agreements, in each case permitted to be
incurred under this Indenture,
(12) Liens created or deposits made to secure the performance of
tenders, bids, leases, statutory obligations, government contracts,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business,
(13) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods,
(14) other Liens securing obligations incurred in the ordinary course
of business, which obligations do not exceed $3,000,000 in the aggregate at
any one time outstanding,
(15) Liens arising pursuant to Sale and Lease-Back Transactions
entered into in compliance with this Indenture,
(16) Liens securing Debt permitted to be incurred under clause (9) or
(11) of the definition of "Permitted Debt,"
(17) Liens incurred in the ordinary course of business of the Company
or any Restricted Subsidiary of the Company with respect to obligations
that do not exceed $7,500,000 at any one time outstanding and that (a) are
not incurred in connection with the borrowing of money or the obtaining of
advances or credit (other than trade credit in the ordinary course of
business) and (b) do not in the aggregate materially detract from the value
of the property or materially impair the use thereof in the operation of
business by the Company or such Restricted Subsidiary,
(18) the Lien of any judgment rendered which is being contested
diligently and in good faith by appropriate proceedings by the Company or
any of its Restricted Subsidiaries and which does not have a material
adverse effect on the ability of the Company and its Restricted
Subsidiaries to operate the business or operations of the Company,
(19) reservations, limitations, provisos and conditions expressed in
any original grants from a government (including any agency or political
subdivision thereof) which do not materially adversely impair the use of
the subject property by the Company or a Restricted Subsidiary,
23
(20) servitudes, licenses, easements, rights-of-way and rights in the
nature of easements (including, without in any way limiting the generality
of the foregoing, servitudes, licenses, easements, rights-of-way and rights
in the nature of easements for sidewalks, public ways, sewers, drains, gas,
steam and water mains or electric light and power, or telephone and
telegraph conduits, poles, wires and cable) which do not in the aggregate
materially adversely impair the use of the subject property by the Company
or a Restricted Subsidiary or in respect to which the Company or any of its
Restricted Subsidiaries has made satisfactory arrangement for relocation so
that such use will not in the aggregate be materially and adversely
impaired,
(21) zoning and building by-laws and ordinances, municipal by-laws and
regulations, and restrictive covenants, which do not materially adversely
interfere with the use of the subject property by the Company or a
Restricted Subsidiary,
(22) with respect to personal property only, Liens arising pursuant to
registration under the Personal Property Act (British Columbia) and similar
legislation in other provinces or jurisdictions exclusively relating to
property and assets subject to equipment leases which are not Capitalized
Lease Obligations,
(23) Liens with respect to any property of (i) any Unrestricted
Subsidiaries, corporations, partnerships, joint ventures or other entities
specified in clause (6) of the "Permitted Investments" definition or (ii)
any other Unrestricted Subsidiaries, if pursuant to any laws or regulations
such property would be deemed to be that of the Company or any of its
Restricted Subsidiaries, and
(24) any extension, renewal or replacement, in whole or in part, of
any Lien described in the foregoing clause (1), (2), (4), (6) or (9) of
this definition; provided that the principal amount secured by any such
extension, renewal or replacement shall not be increased and such lien
shall not extend to any other Property of the Company or its Subsidiaries
other than such item of Property originally covered by such Lien or by
improvement thereon or additions or accessions thereto.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government, including any agency or political
subdivision thereof.
"Physical Notes" means certificated Notes in registered form in
substantially the form set forth in Section 2.04 Form of Security.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and for the purposes of this definition, any Security
authenticated and delivered under Section 3.08 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Preferred Stock" means any Capital Stock of a Person, however
designated, which entitles the holder thereof to a preference with respect to
dividends, distributions or
24
liquidation proceeds of such Person over the holders of other Capital Stock
issued by such Person.
"Private Exchange" has the meaning set forth in the Registration
Rights Agreement.
"Private Exchange Securities" has the meaning set forth in the
Registration Rights Agreement.
"Private Placement Legend" means a legend in the form set forth in
Section 2.04 of this Indenture.
"Property" of any Person means all types of real, personal, tangible,
intangible or mixed property owned by such Person whether or not included in the
most recent consolidated balance sheet of such Person and its Subsidiaries under
GAAP.
"Public Equity Offering" means a public offering of shares of Common
Stock (however designated and whether voting or non-voting) and any and all
rights, warrants, receipts or options to acquire such Common Stock of the
Company pursuant to a registration statement filed with the Commission in
accordance with the Securities Act or pursuant to a prospectus filed with the
appropriate securities regulatory authorities in any province or territory of
Canada. For the purposes of this definition of "Public Equity Offering," any
offering of securities specified in this definition that (i) does not satisfy
the criteria required for a Public Equity Offering because such securities are
not sold pursuant to a registration statement filed with the Commission in
accordance with the Securities Act or pursuant to a prospectus filed with the
appropriate securities regulatory authorities in a province or territory of
Canada and (ii) becomes eligible for resale to the general public in any
province or territory of Canada or the United States of America within 90 days
of the date on which such securities were initially sold, shall be deemed to be
a Public Equity Offering on and as of the date upon which such securities first
become eligible for such resale.
"Purchase Money Debt" means any Debt incurred by a Person to finance
the cost (including the cost of acquisition, construction, lease, installation
or improvement) of an item of Property, the principal amount of which Debt does
not exceed the sum of (i) the lesser of (a) the Fair Market Value of such
property and (b) 100% of such cost and (ii) reasonable fees and expenses of such
Person incurred in connection therewith.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A promulgated under the Securities Act.
"Rating Agencies" means:
(1) S & P; and
(2) Moody's; and
(3) if S&P or Moody's or both will not make a rating of the Notes
publicly available, a nationally recognized United States securities rating
agency or agencies, as
25
the case may be, selected by the Company, which will be substituted for S&P
or Moody's or both, as the case may be.
"Rating Category" means:
(1) with respect to S&P, any of the following categories: BB, B, CCC,
CC, C and D (or equivalent successor categories);
(2) with respect to Moody's, any of the following categories: Ba, B,
Caa, Ca, C and D (or equivalent successor categories); and
(3) the equivalent of any such category of S&P or Moody's used by
another Rating Agency.
In determining whether the rating of the Notes has decreased by one or
more gradations, gradations within Rating Categories (+ and - for S & P; 1, 2
and 3 for Moody's; or the equivalent gradations for another Rating Agency) will
be taken into account (e.g., with respect to S&P a decline in rating from BB+ to
BB, as well as from BB- to B+, will constitute a decrease of one gradation).
"Rating Date" means the date which is 90 days prior to the earlier of
(1) a Change of Control and (2) public notice of the occurrence of a Change of
Control or of the intention by the Company to effect a Change of Control.
"Rating Decline" means the decrease (as compared with the Rating Date)
by one or more gradations within Rating Categories as well as between Rating
Categories of the rating of the Notes by a Rating Agency on, or within 120 days
after, the earlier of the date of public notice of the occurrence of a Change of
Control or of the intention by the Company to effect a Change of Control (which
period will be extended for so long as the rating of the Notes is under publicly
announced consideration for possible downgrade by any of the Rating Agencies).
"Receivables" means chattel paper, instruments, documents, contract
rights or intangibles evidencing or relating to the right to payment of money.
"Redemption Date" when used with respect to any Security to be
redeemed, in whole or in part, means the date fixed for such redemption by or
pursuant to this Indenture.
"Redemption Price" when used with respect to any Security to be
redeemed, in whole or in part, means the price at which it is to be redeemed
pursuant to this Indenture.
"Refinancing Debt" means Debt that replaces, refunds, renews,
refinances or extends any Debt of the Company or a Restricted Subsidiary
permitted to be incurred by the Company or its Restricted Subsidiaries pursuant
to Section 10.06 hereof (other than pursuant to clauses (1), (4), (5), (6), (7),
(8), (9) and (13) of the definition of "Permitted Debt"), but only to the extent
that (i) the Refinancing Debt is subordinated to the Notes to at least the same
extent as the Debt being replaced, refunded, renewed, refinanced or extended, if
at all, (ii) the Refinancing Debt is scheduled to mature either (a) no earlier
than the Debt being replaced, refunded, renewed, refinanced or extended, or (b)
after the Maturity Date, (iii) the portion, if any, of the
26
Refinancing Debt that is scheduled to mature on or prior to the Maturity Date
has a weighted average life to maturity at the time such Refinancing Debt is
incurred that is equal to or greater than the weighted average life to maturity
of the portion of the Debt being replaced, refunded, renewed, refinanced or
extended that is scheduled to mature on or prior to the Maturity Date, and (iv)
such Refinancing Debt is in an aggregate principal amount that is equal to or
less than the sum of (a) the aggregate principal amount then outstanding under
the Debt being replaced, refunded, renewed, refinanced or extended, (b) the
amount of accrued and unpaid interest, if any, and premiums owed, if any, not in
excess of preexisting prepayment provisions on such Debt being replaced,
refunded, renewed, refinanced or extended and (c) the amount of customary fees,
expenses and costs related to the incurrence of such Refinancing Debt.
"Registration Rights Agreement" means the Registration Rights
Agreement dated March 23, 2004 among the Company, the Guarantors and the Initial
Purchasers, as amended from time to time and, with respect to any Notes issued
pursuant to the second sentence of Section 3.01(a), any other registration
rights agreement in connection with the issuance of such Notes.
"Regulation S" means Regulation S under the Securities Act.
"Regulation S Certificate" means a certificate substantially in the
form set forth in Annex A.
"Regulation S Global Security" has the meaning specified in Section
2.05(b).
"Regulation S Securities" means all Securities required pursuant to
Section 3.07(c) to bear a Private Placement Legend. Such term includes the
Regulation S Global Security.
"Replacement Assets" means (i) properties or assets (other than cash
or Cash Equivalents or any Capital Stock or other security) that will be used or
useful in the business of the Company or its Restricted Subsidiaries, or in
businesses reasonably similar to or ancillary to the business of the Company or
its Restricted Subsidiaries or (ii) Capital Stock of any Person that will become
on the date of acquisition thereof a Guarantor as a result of such acquisition.
"Responsible Officer" when used with respect to the Trustee, means an
officer or assistant officer assigned to the corporate trust department of the
Trustee (or any successor group of the Trustee) with direct responsibility for
the administration of this Indenture and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Restricted Global Security" has the meaning specified in Section
2.05.
"Restricted Payments" means any of the following:
(1) the declaration or payment of any dividend or any other
distribution or payment on Capital Stock of the Company or any Restricted
Subsidiary or any payment made to the direct or indirect holders (in their
capacities as such) of Capital Stock of the Company or any Restricted
Subsidiary (other than (x) the amount of any such dividends
27
or distributions payable solely in Capital Stock (other than Disqualified
Capital Stock) of the Company, and (y) in the case of Restricted
Subsidiaries, dividends or distributions payable to the Company or to a
Restricted Subsidiary),
(2) the purchase, redemption or other acquisition or retirement for
value of any Capital Stock of the Company or any of its Restricted
Subsidiaries (other than Capital Stock owned by the Company or a Restricted
Subsidiary),
(3) the making of any principal payment on, or the purchase,
defeasance, repurchase, redemption or other acquisition or retirement for
value, prior to any scheduled maturity, scheduled repayment or scheduled
sinking fund payment, of any Debt of the Company or any Guarantor which is
subordinated in right of payment to the Notes or such Guarantor's
Guarantee, as the case may be (other than any such Debt acquired in
anticipation of satisfying a scheduled sinking fund obligation, principal
installment or final maturity in each case due within one year of the date
of acquisition),
(4) the making of any Investment other than a Permitted Investment,
(5) any Designation; provided that the Designation of a Subsidiary of
the Company as an Unrestricted Subsidiary shall be deemed to include the
Designation of all of the Subsidiaries of such Subsidiary, and
(6) the forgiveness of any Debt of an Affiliate of the Company owed to
the Company or a Restricted Subsidiary.
In determining the amount of any Restricted Payment, cash
distributed or invested shall be valued at the face amount thereof and
Property other than cash shall be valued at its Fair Market Value, except
that, in determining the amount of any Restricted Payment made under clause
(5) of this definition, the amount of such Restricted Payment (the
"Designation Amount") shall be equal to the greater of (1) the book value,
or (2) the Fair Market Value, of the Company's proportionate direct or
indirect interest in such Subsidiary on such date.
"Restricted Securities" means a restricted security within the meaning
of Rule 144 and all Securities required pursuant to Section 3.07(c) to bear a
Private Placement Legend. Such term includes the Restricted Global Security;
provided, that the Trustee shall be entitled to request and conclusively rely
upon an Opinion of Counsel with respect to whether any Note is a Restricted
Security.
"Restricted Securities Certificate" means a certificate substantially
in the form set forth in Annex B.
"Restricted Subsidiary" means any Subsidiary of the Company other than
an Unrestricted Subsidiary.
"Rule 144" means Rule 144 under the Securities Act.
"S&P" means Standard & Poor's Ratings Group and its successors.
28
"Rule 144A" means Rule 144A under the Securities Act.
"Sale and Lease-back Transaction" means any arrangement with any
Person providing for the leasing by the Company or any Restricted Subsidiary of
any real or tangible personal property, which property has been or is to be sold
or transferred by the Company or such Restricted Subsidiary to such Person in
contemplation of such leasing.
"Securities Act" means the U.S. Securities Act of 1933 and (unless the
context otherwise requires) includes the rules and regulations of the Commission
promulgated thereunder.
"Securities Act Legend" means the Private Placement Legend.
"Security" and "Securities" means the Notes, the Exchange Securities
and the Private Exchange Securities.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 3.07(a).
"Subsidiary" of any specified Person means any corporation,
partnership, joint venture, limited liability company, association or other
business entity, whether now existing or hereafter organized or acquired:
(1) in the case of a corporation, of which more than 50% of the total
voting power of the Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors,
officers or trustees thereof is held by that first-named Person or any of
its Subsidiaries; or
(2) in the case of a partnership, joint venture, limited liability
company, association or other business entity, with respect to which that
first-named Person or any of its Subsidiaries has the power to direct or
cause the direction of the management and policies of that entity by
contract or otherwise or if in accordance with GAAP such entity is
consolidated with the first-named Person for financial statement purposes;
provided that, for greater certainty, the term "Subsidiary" when used in
relation to the Company or any of its Subsidiaries shall not include Powell
River Energy Inc. or Powell River Energy Limited Partnership.
"Successor Security" of any particular Security means every Security
issued after, and evidencing all or a portion of the same debt as that evidenced
by, such particular Security; and for the purposes of this definition, any
Security authenticated and delivered under Section 3.08 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"Taxes" means any present or future tax, duty, levy, impost,
assessment or other government charge (including penalties, interest and any
other liabilities related thereto) imposed or levied by or on behalf of a Taxing
Authority.
29
"Taxing Authority" means the federal government of Canada or any
government of any political subdivision, province or territory of Canada or any
authority or agency therein or thereof having power to tax.
"Taxing Jurisdiction" means Canada or any political subdivision,
province or territory therein.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"Unrestricted Subsidiary" means (i) any Subsidiary of an Unrestricted
Subsidiary and (ii) any Subsidiary of the Company which is classified on or
after the Issue Date as an Unrestricted Subsidiary by a resolution adopted by
the Board of Directors of the Company; provided that a Subsidiary may be so
classified as an Unrestricted Subsidiary only if such classification is in
compliance with Section 10.07 hereof; provided further that the Board of
Directors of the Company may not designate any Subsidiary of the Company to be
an Unrestricted Subsidiary if, after such designation, such Subsidiary owns any
Capital Stock of, or owns or holds any Lien on any property of, any Restricted
Subsidiary which is not a Subsidiary of the Subsidiary to be so designated. The
Trustee shall be given prompt notice by the Company of each resolution adopted
by the Board of Directors of the Company under this provision, together with a
copy of each such resolution adopted.
"U.S. Depositary" means The Depository Trust Company until a successor
U.S. Depositary shall have become such pursuant to the applicable provisions of
this Indenture, and thereafter "U.S. Depositary" shall mean each successor U.S.
Depositary.
"U.S. Government Securities" means securities that are direct
obligations of the United States of America, direct obligations of the Federal
Home Loan Mortgage Corporation, direct obligations of the Federal National
Mortgage Association, securities which the timely payment of whose principal and
interest is unconditionally guaranteed by the full faith and credit of the
United States of America, trust receipts or other evidence of indebtedness of a
direct claim upon the instrument described above and money market funds that
invest solely in such securities.
"U.S. Person" is defined in this Indenture to mean (i) any individual
resident in the United States, (ii) any partnership or corporation organized or
incorporated under the laws of the United States, (iii) any estate of which an
executor or administrator is a U.S. Person (other than an estate governed by
foreign law and of which at least one executor or administrator is a non-U.S.
Person who has sole or shared investment discretion with respect to its assets),
(iv) any trust of which any trustee is a U.S. Person (other than a trust of
which at least one trustee is a non-U.S. Person who has the sole or shared
investment discretion with respect to its assets and no beneficiary of the trust
(and no settler if the trust is revocable) is a U.S. Person, (v) any agency or
branch of a foreign entity located in the United States, (vi) any
non-discretionary or similar account (other than an estate or trust) held by a
dealer or other fiduciary for the benefit or account of a U.S. Person, (vii) any
discretionary or similar account (other than an estate or trust) held by a
dealer or other fiduciary organized, incorporated or (if an individual) resident
in the
30
United States (other than such an account held for the benefit or account of a
non-U.S. Person), (viii) any partnership or corporation organized or
incorporated under the laws of a foreign jurisdiction and formed by a U.S.
Person principally for the purpose of investing in securities not registered
under the Securities Act (unless it is organized or incorporated, and owned, by
accredited investors within the meaning of Rule 501 (a) under the Securities Act
who are not natural persons, estates or trusts); provided, however, that the
term "U.S. Person" does not include (a) a branch or agency of a U.S. Person that
is located and operating outside the United States for valid business, purposes
as a locally regulated branch or agency engaged in the banking or insurance
business, (b) any employee benefit plan established and administered in
accordance with the law, customary practices and documentation of a foreign
country and (c) the international organizations set forth in Section 902(o)(7)
of Regulation S under the Securities Act and any other similar international
organizations, and their agencies, affiliates and pension plans.
"United States" means the United States of America (including the
States thereof and the District of Columbia), its territories, its possessions
and other areas subject to its jurisdiction.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".
"Voting Stock" of any Person means Capital Stock of such Person which
ordinarily has voting power for the election of directors (or persons performing
similar functions) of such Person, whether at all times or only so long as no
senior class of securities has such voting power by reason of any contingency.
"Wholly Owned Restricted Subsidiary" means any Restricted Subsidiary,
all of the outstanding voting securities (other than directors' qualifying
shares or similar requirements of law) of which are owned, directly or
indirectly, by the Company or another Wholly Owned Restricted Subsidiary.
SECTION 1.02 Compliance Certificates and Opinions.
(a) Upon any application or request by the Company or any Guarantor,
as the case may be, to the Trustee to take any action under any provision of
this Indenture, the Company shall furnish to the Trustee such certificates and
opinions as may be required under the Trust Indenture Act. Each such certificate
or opinion shall be given in the form of an Officers' Certificate, if to be
given by an officer of the Company, or an Opinion of Counsel, if to be given by
counsel, and shall comply with the requirements of the Trust Indenture Act and
any other requirement set forth in this Indenture.
(b) Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than pursuant to
Section 10.04) shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition;
31
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he
has made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with (which, in the case of an Opinion of Counsel, may be
limited to reliance on an Officers' Certificate as to matters of fact); and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 1.03 Form of Documents Delivered to Trustee.
(a) In any case where several matters are required to be certified by,
or covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
(b) Any certificate or opinion of an Officer of the Company or any
Guarantor, may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless such officer
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to the matters upon which his
certificate or opinion is based are erroneous. Any such certificate or opinion
of counsel may be based, insofar as it relates to factual matters, upon a
certificate or opinion of, or representations by, an Officer or Officers of the
Company or any Guarantor stating that the information with respect to such
factual matters is in the possession of the Company, unless such counsel knows,
or in the exercise of reasonable care should know, that the certificate or
opinion or representations with respect to such matters are erroneous.
(c) Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 1.04 Acts of Holders; Record Date.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company and
the Guarantors. Such instrument or instruments (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the "Act" of the
Holders signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be
32
sufficient for any purpose of this Indenture and (subject to Section 6.01)
conclusive in favor of the Trustee and the Company and the Guarantors, if made
in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
(c) The ownership of Securities (including the principal amount and
serial numbers of Securities held by any Person, and the date of holding the
same) shall be proved by the Security Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future Holder
of the same Security and the Holder of every Security issued upon the
registration of transfer thereof or in exchange therefore or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee or the
Company in reliance thereon, whether or not notation of such action is made upon
such Security.
(e) The Company may set any day as a record date for the purpose of
determining the Holders of Notes entitled to give, make or take any request,
demand, authorization, direction, notice, consent, waiver or other action
provided or permitted by this Indenture to be given, made or taken by Holders of
Securities, provided that the Company may not set a record date for, and the
provisions of this paragraph shall not apply with respect to, the giving or
making of any notice, declaration, request or direction referred to in the next
paragraph. If not set by the Company prior to the first solicitation of a Holder
made by any Person in respect of any such matter referred to in the foregoing
sentence, the record date for any such matter shall be the 30th day (or, if
later, the date of the most recent list of Holders required to be provided
pursuant to Section 7.01) prior to such first solicitation. If any record date
is set pursuant to this paragraph, the Holders of Securities on such record
date, and no other Holders, shall be entitled to take the relevant action,
whether or not such Holders remain Holders after such record date; provided that
no such action shall be effective hereunder unless taken on or prior to the
applicable Expiration Date by Holders of the requisite aggregate principal
amount of Securities on such record date. Nothing in this paragraph shall be
construed to prevent the Company from setting a new record date for any action
for which a record date has previously been set pursuant to this paragraph
(whereupon the record date previously set shall automatically and with no action
by any Person be cancelled and of no effect), and nothing in this paragraph
shall be construed to render ineffective any action taken by Holders of the
requisite aggregate principal amount of Securities on the date such action is
taken. Promptly after any record date is set pursuant to this paragraph, the
Company, at its own expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration Date to be given to the
Trustee in writing and to each Holder of Securities in the manner set forth in
Section 1.06.
33
(f) The Trustee may set any day as a record date for the purpose of
determining the Holders of Securities entitled to join in the giving or making
of (1) any Notice of Default, (2) any declaration of acceleration referred to in
Section 5.02, (3) any request to institute proceedings referred to in Section
5.08(b) or (4) any direction referred to in Section 5.12. If any record date is
set pursuant to this paragraph, the Holders of Notes on such record date, and no
other Holders, shall be entitled to join in such notice, declaration, request or
direction, whether or not such Holders remain Holders after such record date;
provided that no such action shall be effective hereunder unless taken on or
prior to the applicable Expiration Date by Holders of the requisite aggregate
principal amount of Securities on such record date. Nothing in this paragraph
shall be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite aggregate principal amount of Securities on the date such
action is taken. Promptly after any record date is set pursuant to this
paragraph, the Trustee, at the Company's expense, shall cause notice of such
record date, the proposed action by Holders and the applicable Expiration Date
to be given to the Company in writing and to each Holder of Securities in the
manner set forth in Section 1.06.
(g) With respect to any record date set pursuant to this Section, the
party hereto which sets such record date may designate any day as the
"Expiration Date" and from time to time may change the Expiration Date to any
earlier or later day; provided that no such change shall be effective, unless
notice of the proposed new Expiration Date is given to the other parties hereto
in writing and to each Holder of Securities in the manner set forth in Section
1.06, on or prior to the existing Expiration Date. If an Expiration Date is not
designated with respect to any record date set pursuant to this Section, the
party hereto which set such record date shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
(h) Without limiting the foregoing, a Holder entitled hereunder to
take any action hereunder with regard to any particular Security may do so with
regard to all or any part of the principal amount of such Security or by one or
more duly appointed agents each of which may do so pursuant to such appointment
with regard to all or any part of such principal amount.
SECTION 1.05 Notices. Except for notice or communications to Holders,
any notice or communication, shall be given in writing and delivered in person,
sent by facsimile, delivered by commercial courier service or mailed by
first-class mail, postage prepaid, addressed as follows:
If to the Company or any Guarantor:
Norske Skog Canada Limited
16th Floor
250 Howe Street
Vancouver, British Columbia V6C 3R8
34
Canada
Attention: Corporate Secretary
Fax Number: (604) 654-4070
with a copy to:
Lawson Lundell
1600 Cathedral Place
925 West Georgia Street
Vancouver, British Columbia V6C 3L2
Canada
Attention: Gordon R. Chambers
Fax Number: (604) 669-1620
and
Shearman & Sterling LLP
1080 Marsh Road
Menlo Park, California 94025
Attention: Bruce Czachor
Fax Number: (650) 838-3699
If to the Trustee:
Wells Fargo Bank, National Association
Corporate Trust Services
213 Court Street, Suite 703
Middletown, Connecticut 06457
Attention: Corporate Trust Services
Fax Number: (860) 704-6219
Wells Fargo Bank, National Association
Sixth and Marquette
MAC N9303-120
Minneapolis, MN 55479
Attention: Corporate Trust Services
Fax Number: (612) 667-9825
SECTION 1.06 Notice to Holders; Waiver.
(a) Where this Indenture provides for notice to Holders of any event,
such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to each Holder
affected by such event, at his address as it appears in the Security Register,
not later than the latest date (if any), and not earlier than the earliest date
(if any), prescribed for the giving of such notice. In any case where notice to
Holders is given by mail, neither the failure to mail such notice, nor any
defect in any notice so mailed, to any particular Holder shall affect the
sufficiency of such notice with respect to other Holders. Where this Indenture
provides for notice in any manner, such notice may be waived in
35
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Trustee, but such filing shall not be
a condition precedent to the validity of any action taken in reliance upon such
waiver.
(b) In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
SECTION 1.07 Conflict with Trust Indenture Act. Until such time as
this Indenture shall be qualified under the Trust Indenture Act, this Indenture,
the Company, the Guarantors and the Trustee shall be deemed for all purposes
hereof to be subject to and governed by the Trust Indenture Act to the same
extent as would be the case if this Indenture were so qualified on the date
hereof. If any provision hereof limits, qualifies or conflicts with a provision
of the Trust Indenture Act that is required under such Act to be a part of and
govern this Indenture, the latter provision shall control. If any provision of
this Indenture modifies or excludes any provision of the Trust Indenture Act
that may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
SECTION 1.08 Effect of Headings and Table of Contents. The Article
and Section headings herein and the Table of Contents are for convenience only
and are not to be considered a part of, and shall not affect the construction
hereof.
SECTION 1.09 Successors and Assigns. All agreements in this Indenture
of the Company and any Guarantors shall bind their respective successors and
assigns. All agreements of the Trustee, any additional trustee, and any Paying
Agents in this Indenture shall bind their respective successors.
SECTION 1.10 Separability Clause. In case any provision in this
Indenture or in the Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 1.11 Benefits of Indenture. Nothing in this Indenture or in
the Securities, express or implied, shall give to any Person, other than the
parties hereto, any Paying Agent, any Security Registrar and their successors
hereunder and the Holders of Securities, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
SECTION 1.12 No Personal Liability of Directors, Officers, Employees
and Stockholders. No recourse for the payment of the principal of or premium,
if any, or interest, including Additional Interest, on any of the Notes, or for
any claim based thereon or otherwise in respect thereof, and no recourse under
or upon any obligation, covenant or agreement of the Company or any Guarantor in
this Indenture or in any supplemental indenture, or in any of the Notes, or
because of the creation of any Debt represented thereby, shall be had against
any stockholder, officer, director or employee, as such, past, present or
future, of the Company or any Guarantor or of any successor corporation or
against the property or assets of any such
36
stockholder, officer, employee or director, either directly or through the
Company or any Guarantor, or any successor corporation thereof, whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise; it being expressly understood that this
Indenture and the Notes are solely obligations of the Company and the
Guarantors, and that no such personal liability whatever shall attach to, or is
or shall be incurred by, any shareholder, officer, employee or director of the
Company or any Guarantor, or any successor corporation thereof, because of the
creation of the indebtedness hereby authorized, or under or by reason of the
obligations, covenants or agreements contained in this Indenture or the Notes or
implied therefrom, and that any and all such personal liability of, and any and
all claims against every stockholder, officer, employee and director, are hereby
expressly waived and released as a condition of, and as a consideration for, the
execution of this Indenture and the issuance of the Notes. It is understood that
this limitation on recourse is made expressly for the benefit of any such
shareholder, employee, officer or director and may be enforced by any of them.
SECTION 1.13 Governing Law. THIS INDENTURE AND THE SECURITIES SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK.
SECTION 1.14 Business Days; Legal Holidays.
A "Business Day" is a day that is not a Legal Holiday. A "Legal
Holiday" is a Saturday, a Sunday, a United States or Canadian
federally-recognized holiday or a day on which banking institutions are not
required to be open, or are authorized or obligated by law or executive order to
close, in the State of New York or the Province of British Columbia. If a
payment date is a Legal Holiday at a place of payment, payment may be made at
that place on the next succeeding day that is not a Legal Holiday, and no
interest shall accrue for the intervening period.
SECTION 1.15 Consent to Service; Jurisdiction
By the execution and delivery of this Indenture, the Company and each
Guarantor (i) acknowledges that it has, by separate written instrument,
designated and appointed CT Corporation System as its authorized agent upon
which process may be served in any suit, action or proceeding arising out of or
relating to the Securities or this Indenture that may be instituted in any
United States Federal or State court in the State of New York, Borough of
Manhattan, or brought under United States Federal or State securities laws or
brought by the Trustee (whether in its individual capacity or in its capacity as
Trustee hereunder), and acknowledges that CT Corporation System has accepted
such designation, (ii) submits to the jurisdiction of any such court in any such
suit, action or proceeding, and (iii) agrees that service of process upon CT
Corporation System and written notice of said service to it (as set out in this
Section 1.15), shall be deemed in every respect effective service of process
upon it in any such suit or proceeding. The Company and each Guarantor further
agree to take any and all action, including the execution and filing of any and
all such documents and instruments as may be necessary to continue such
designation and appointment of CT Corporation System, in full force and effect
so long as this Indenture shall be in full force and effect; provided that the
Company may and shall (to the extent CT Corporation System ceases to be able to
be served on the basis contemplated
37
herein), by written notice to the Trustee, designate such additional or
alternative agent for service of process under this Section 1.15 that (i)
maintains an office located in the Borough of Manhattan, The City of New York in
the State of New York, (ii) is either (x) counsel for the Company or (y) a
corporate service company which acts as agent for service of process for other
Persons in the ordinary course of its business and (iii) agrees to act as agent
for service of process in accordance with this Section 1.15. Such notice shall
identify the name of such agent for process and the address of such agent for
process in the Borough of Manhattan, The City of New York, State of New York.
Upon the request of any Holder, the Trustee shall deliver such information to
such Holder. Notwithstanding the foregoing, there shall, at all times, be at
least one agent for service of process for the Company and any Guarantors, if
any, appointed and acting in accordance with this Section 1.15.
To the extent that the Company or any Guarantor has or hereafter may
acquire any immunity from jurisdiction of any court or from any legal process
(whether through service of notice, attachment prior to judgment, attachment in
aid of execution, execution or otherwise) with respect to itself or its
property, the Company and such Guarantor hereby irrevocably waives such immunity
in respect of its obligations under this Indenture and the Securities, to the
extent permitted by law.
SECTION 1.16 Judgment Currency.
(a) The Company and each of the Guarantors, jointly and severally,
each agree to indemnify each Holder against any loss incurred by such party as a
result of any judgment or order being given or made for any amount due under
this Indenture and such judgment or order being expressed and paid in a currency
(the "Judgment Currency") other than United States dollars and as a result of
any variation as between (i) the rate of exchange at which the United States
dollar amount is converted into the Judgment Currency for the purpose of such
judgment or order and (ii) the spot rate of exchange in The City of New York at
which such party on the date of payment of such judgment or order is able to
purchase United States dollars with the amount of the Judgment Currency actually
received by such party. The foregoing indemnity shall continue in full force and
effect notwithstanding any such judgment or order as aforesaid. The term "spot
rate of exchange" shall include any premiums and costs of exchange payable in
connection with the purchase of, or conversion into, United States dollars.
(b) The Company covenants and agrees that the following provisions
shall apply to conversion of currency in the case of the Securities and this
Indenture in the event the Company is in default under the terms of this
Indenture:
(1) If for the purpose of obtaining judgment in, or enforcing the
judgment of, any court in any country, it becomes necessary to convert into
a currency (the "judgment currency") an amount due in U.S. Dollars, then
the conversion shall be made at the rate of exchange prevailing on the
Business Day before the day on which the judgment is given or the order of
enforcement is made, as the case may be (unless a court shall otherwise
determine).
(2) If there is a change in the rate of exchange prevailing
between the Business Day before the day on which the judgment is given or
an order of enforcement
38
is made, as the case may be (or such other date as a court shall
determine), and the date of receipt of the amount due, the Company will pay
such additional amount (or, as the case may be, be refunded such lesser
amount), if any, as may be necessary so that the amount paid in the
judgment currency when converted at the rate of exchange prevailing on the
date of receipt will produce the amount in U.S. Dollars originally due.
(3) In the event of the winding-up of the Company at any time
while any amount or damages owing under the Securities or this Indenture,
or any judgment or order rendered in respect thereof, shall remain
outstanding, the Company shall indemnify and hold the Holders and the
Trustees harmless against any deficiency arising or resulting from any
variation in rates of exchange between (1) the date as of which the
equivalent of the amount in U.S. Dollars due or contingently due under the
Securities and this Indenture (other than under this Subsection (3)) is
calculated for the purposes of such winding-up and (2) the final date for
the filing of proofs of claim in such winding-up. For the purpose of this
Subsection (3), the final date for the filing of proofs of claim in the
winding-up of the Company shall be the date fixed by the liquidator or
otherwise in accordance with the relevant provisions of applicable law as
being the latest practicable date as at which liabilities of the Company
may be ascertained for such winding-up prior to payment by the liquidator
or otherwise in respect thereto.
(4) The obligations contained in Subsections (2) and (3) of this
Section 1.16 shall constitute separate and independent obligations of the
Company from its other obligations under the Securities and this Indenture,
shall give rise to separate and independent causes of action against the
Company, shall apply irrespective of any waiver or extension granted by any
Holders or the Trustees or any of them from time to time and shall continue
in full force and effect notwithstanding any judgment or order or the
filing of any proof of claim in the winding-up of the Company for a
liquidated sum in respect of amounts due hereunder (other than under
subsection (3) above) or under any such judgment or order. Any such
deficiency as aforesaid shall be deemed to constitute a loss suffered by
the Holders or the Trustee, as the case may be, and no proof or evidence of
any actual loss shall be required by the Company or the liquidator or
otherwise or any of them which shall be liable for such deficiency. In the
case of subsection (3) above, the amount of such deficiency shall not be
deemed to be reduced by any variation in rates of exchange occurring
between the said final date and the date of any liquidating distribution.
(5) The term "rate(s) of exchange" shall mean the rate of
exchange quoted by The Royal Bank of Canada at its central foreign exchange
desk in its main branch in Vancouver, British Columbia at 12:00 noon
(Vancouver time) for the purchases of U.S. Dollars with the judgment
currency other than U.S. Dollars referred to in subsections (1) and (3)
above and includes any premiums and costs of exchange payable.
(c) The Trustee shall have no duty or liability with respect to
monitoring or enforcing this Section 1.16 and shall have no liability to the
Holders due to fluctuations in currency rates.
39
SECTION 1.17 Currency Equivalent. Except as provided in Section 1.16,
for purposes of the construction of the terms of this Indenture or of the
Securities, in the event that any amount, including any amounts owed by the
Company to the Trustee, is stated herein in the currency of one nation (the
"First Currency"), as of any date such amount shall also be deemed to represent
the amount in the currency of any other relevant nation (the "Other Currency")
which is required to purchase such amount in the First Currency at the rate of
exchange quoted by The Royal Bank of Canada at its central foreign exchange desk
in its main branch in Vancouver, British Columbia at 12:00 noon (Vancouver time)
on the date of determination.
SECTION 1.18 Communications by Holders with Other Holders. Holders
may communicate pursuant to Trust Indenture Act Section 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Company, the Guarantors, the Trustee, the Security Registrar and anyone else
shall have the protection of Trust Indenture Act Section 312(c).
SECTION 1.19 No Adverse Interpretation of Other Agreements. This
Indenture may not be used to interpret another indenture, loan, security or debt
agreement of the Company or any Subsidiary thereof. No such indenture, loan,
security or debt agreement may be used to interpret this Indenture.
ARTICLE II
SECURITY FORMS
SECTION 2.01 Forms Generally and Amount of Notes.
(a) The Notes and the Trustee's certificate of authentication with
respect thereto shall be substantially in the forms set forth in this Article
Two. The Notes may have notations, legends or endorsements required by law, rule
or usage to which the Company is subject. Without limiting the generality of the
foregoing, Notes offered and sold to Qualified Institutional Buyers in reliance
on Rule 144A ("Rule 144A Notes") shall bear the Private Placement Legend and
include the form of assignment set forth in this Article Two, Notes offered and
sold in offshore transactions in reliance on Regulation S ("Regulation S Notes")
shall bear the Private Placement Legend and include the form of assignment set
forth in this Article Two. Notes transferred pursuant to Section 3.07 ("Other
Notes") shall be represented by a Physical Note bearing the Private Placement
Legend. Each Note shall be dated the date of its authentication. The Notes shall
be issuable only in registered form without coupons in denominations of US$1,000
and any integral multiple of US$1,000.
(b) Upon the occurrence of the exchange offer in accordance with the
Registration Rights Agreement, the Exchange Securities or the Private Exchange
Securities issued by the Company shall be substantially in the form set forth in
this Article Two (but shall not contain paragraph 10 thereof).
(c) The terms and provisions contained in the Notes shall constitute,
and are expressly made, a part of this Indenture and, to the extent applicable,
the Company, the Guarantors and the Trustee, by their execution and delivery of
this Indenture, expressly agree to such terms and provisions and agree to be
bound thereby. However, to the extent any provision
40
of the Notes conflicts with the provisions of this Indenture, the provisions of
this Indenture shall govern and be controlling.
(d) The Notes may be presented for registration of transfer and
exchange at the offices of the Security Registrar.
SECTION 2.02 Security Registrar and Paying Agent. (a) The Company
shall maintain an office or agency (which shall be located in the Borough of
Manhattan in The City of New York, State of New York) where Notes may be
presented for registration of transfer or for exchange (the "Security
Registrar"), and an office or agency where Notes may be presented for payment
(the "Paying Agent") and an office or agency where notices and demands to or
upon the Company, if any, in respect of the Notes and this Indenture may be
served. The Securities Registrar shall keep a register (the "Register") of the
names and address of the Holders and of the transfer and exchange of the Notes.
The Company may have one or more additional Paying Agents. The term "Paying
Agent" includes any additional Paying Agent. The Company may change any Paying
Agent or Security Registrar without notice to any Holder. The Company or any of
its Subsidiaries may act as Paying Agent or Security Registrar.
(b) The Company shall enter into an appropriate agency agreement,
which shall incorporate applicable provisions of the Trust Indenture Act, with
any Agent that is not a party to this Indenture. The agreement shall implement
the provisions of this Indenture that relate to such Agent. The Company shall
notify the Trustee of the name and address of any such Agent. If the Company
fails to maintain a Security Registrar or Paying Agent, or fails to give the
foregoing notice, the Trustee shall act as such and shall be entitled to
appropriate compensation in accordance with Section 6.07.
(c) The Company initially appoints the Trustee as Security Registrar,
Paying Agent and Agent for service of notices and demand (subject to Section
1.15 hereof) in connection with the Notes and this Indenture.
SECTION 2.03 Paying Agent To Hold Money in Trust. Each Paying Agent
shall hold in trust for the benefit of the Holders or the Trustee all money held
by the Paying Agent for the payment of principal of, premium (if any) or
interest on the Notes (whether such money has been paid to it by the Company or
any other obligor on the Notes or any Guarantor), and the Company and the Paying
Agent shall notify the Trustee in writing of any default by the Company (or any
other obligor on the Notes or any Guarantor) in making any such payment. Money
held in trust by the Paying Agent need not be segregated except as required by
law and in no event shall the Paying Agent be liable for any interest on any
money received by it hereunder. The Company at any time may require the Paying
Agent to pay all money held by it to the Trustee and account for any funds
disbursed and the Trustee may at any time during the continuance of any Event of
Default specified in clause (1) or (2) of Section 5.01(a) hereof, upon written
request to the Paying Agent, require such Paying Agent to pay forthwith all
money so held by it to the Trustee and to account for any funds disbursed. Upon
making such payment, the Paying Agent shall have no further liability for the
money delivered to the Trustee.
41
SECTION 2.04 Form of Security
[FORM OF PRIVATE PLACEMENT LEGEND]
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), AND ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE
UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS
SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED
INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER
THE SECURITIES ACT) (AN "INSTITUTIONAL ACCREDITED INVESTOR") OR (C) IT IS NOT A
U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE
WITH REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT, WITHIN
THE TIME PERIOD REFERRED TO UNDER RULE 144(k) UNDER THE SECURITIES ACT AS IN
EFFECT ON THE DATE OF TRANSFER OF THIS NOTE, RESELL OR OTHERWISE TRANSFER THIS
NOTE EXCEPT (A) TO NORSKE SKOG CANADA LIMITED OR ANY OF ITS SUBSIDIARIES, (B) TO
A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED
INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE TRUSTEE A SIGNED LETTER
CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS
ON TRANSFER OF THIS NOTE (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE
TRUSTEE), AND, IF REQUESTED BY NORSKE SKOG CANADA LIMITED OR THE TRUSTEE, AN
OPINION OF COUNSEL ACCEPTABLE TO THEM THAT SUCH TRANSFER IS IN COMPLIANCE WITH
THE SECURITIES ACT, (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT (PROVIDED THAT SUCH NON-U.S.
PERSONS AGREE NOT TO RESELL OR OTHERWISE TRANSFER THE NOTE IN CANADA OR TO OR
FOR THE BENEFIT OF A CANADIAN RESIDENT, EXCEPT IN ACCORDANCE WITH APPLICABLE
CANADIAN SECURITIES LAWS), (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (F) PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES THAT
IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF
THIS NOTE WITHIN THE TIME PERIOD REFERRED TO IN RULE 144(k) UNDER THE SECURITIES
ACT AFTER THE ORIGINAL ISSUANCE OF THE NOTE, THE HOLDER MUST TRANSFER AND SUBMIT
THIS CERTIFICATE TO THE TRUSTEE. IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL
ACCREDITED INVESTOR OR NON-U.S. PERSON, THE HOLDER MUST, PRIOR TO SUCH TRANSFER,
FURNISH TO THE TRUSTEE AND NORSKE SKOG CANADA LIMITED SUCH CERTIFICATIONS, LEGAL
OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY REASONABLY
42
REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION", "UNITED
STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER
THE SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO
REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING
RESTRICTIONS.
THIS NOTE HAS NOT BEEN THE SUBJECT OF ANY PROSPECTUS FILED UNDER THE SECURITIES
LAWS OF ANY CANADIAN PROVINCE OR TERRITORY. THE HOLDER OF THIS NOTE BY ITS
ACCEPTANCE HEREOF REPRESENTS, IF IT IS A RESIDENT OF CANADA, THAT IT IS
PURCHASING THE NOTE IN A TRANSACTION WHICH IS EXEMPT FROM THE REGISTRATION AND
PROSPECTUS REQUIREMENTS OF APPLICABLE CANADIAN SECURITIES LAWS. THE SALE OF THE
NOTE TO IT QUALIFIES (BY REASON OF THE AMOUNT OF THE CONSIDERATION BEING PAID BY
THE PURCHASER OF THE SECURITIES OR BY REASON OF THE STATUS OF THE PURCHASER, AS
THE CASE MAY BE) FOR AN EXEMPTION FROM THE PROSPECTUS FILING AND DELIVERY
OBLIGATIONS UNDER APPLICABLE CANADIAN PROVINCIAL OR TERRITORIAL SECURITIES LAWS
(PROVIDED THAT APPLICABLE REGISTRATION REQUIREMENTS AND FILING OBLIGATIONS ARE
SATISFIED AND ANY APPLICABLE FEES ARE PAID), AND IT HAS PROVIDED SUCH
INFORMATION AND MADE SUCH REPRESENTATIONS TO THE SELLER OF THE SECURITIES AS MAY
BE REASONABLY NECESSARY FOR THE SELLER TO RELY ON SUCH EXEMPTIONS AND AGREES
THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS LEGEND WILL BE REMOVED UPON THE
REQUEST OF THE HOLDER AFTER THE DATE ON WHICH RESALE RESTRICTIONS TERMINATE
UNDER APPLICABLE SECURITIES LAWS.
43
[FORM OF ASSIGNMENT FOR
RESTRICTED NOTES]
I or we assign and transfer this Note to:
(Insert assignee's social security or tax I.D. number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip or postal code of assignee)
and irrevocably appoint:
________________________________________________________________________________
________________________________________________________________________________
Agent to transfer this Note on the books of the Company. The Agent may
substitute another to act for him.
In connection with any transfer of this Note occurring prior to the date which
is the earlier of (i) the date the Shelf Registration Statement is declared
effective or (ii) the end of the period referred to in Rule 144(k) under the
Securities Act, the undersigned confirms without utilizing any general
solicitation or general advertising that:
[Check One]
[ ] (a) This Note is being transferred in compliance with the exemption from
registration under the Securities Act provided by Rule 144A
thereunder.
or
[ ] (b) This Note is being transferred other than in accordance with (a) above
and documents are being furnished which comply with the conditions of
transfer set forth in this Note and the Indenture.
If neither of the foregoing boxes is checked, the Trustee or Security Registrar
shall not be obligated to register this Note in the name of any person other
than the Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Sections 2.05 and 3.07 of the Indenture
shall have been satisfied.
Date: Your Signature:
------------------------ ------------------------
(Sign exactly as your name
appears on the face of this Note)
- ------------------------------
Signature Guaranteed
44
(Signature must be guaranteed by a participant in a recognized signature
guaranty medallion program or other signature guarantor acceptable to the
Trustee)
45
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Note for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated:
------------------------------ ----------------------------------------
NOTICE: To be executed by
an executive officer
46
[FORM OF LEGEND FOR GLOBAL NOTE]
Any Global Note authenticated and delivered hereunder shall bear a
legend (which would be in addition to any other legends required in the case of
a Restricted Note) in substantially the following form:
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREIN
AFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF
A DEPOSITORY. THIS NOTE IS NOT EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF
A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER
THAN A TRANSFER OF THIS NOTE AS A WHOLE TO A NOMINEE OF THE DEPOSITORY OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE) MAY BE REGISTERED EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY (A NEW YORK CORPORATION) ("DTC") TO THE COMPANY
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
47
[FORM OF NOTE]
CUSIP __________
NORSKE SKOG CANADA LIMITED
No. __________ US$_____________
7-3/8% SENIOR NOTE DUE 2014
NORSKE SKOG CANADA LIMITED, a corporation incorporated under the laws
of Canada (the "Company," which term includes any successor corporation under
the Indenture herein after referred to), for value received, promises to pay to
CEDE & Co. or registered assigns the principal sum of [___________] U.S. DOLLARS
(US$______) on March 1, 2014 at the office or agency of the Company referred to
below.
Interest Payment Dates: March 1 and September 1.
Record Dates: February 15 and August 15.
Elk Falls Pulp and Paper Limited, Norske Skog Canada (Japan) Ltd.,
Norske Skog Canada Finance Limited, Norske Skog Canada Pulp Operations Limited,
Norske Skog Canada Pulp Sales Inc., Norske Skog Canada Sales Inc., Norske Skog
Canada (USA) Inc., Norske Skog Canada Services (Hungary) Limited Liability
Company, NSCL Holdings Inc., Pacifica Papers Sales Ltd., Pacifica Papers Sales
Inc., Pacifica Poplars Ltd., Pacifica Poplars Inc., Pacifica Papers US Inc. and
Norske Canada (collectively the "Guarantors," which term includes any successor
under the Indenture hereinafter referred to and any Restricted Subsidiary that
provides a Guarantee pursuant to the Indenture) have jointly and severally,
fully and unconditionally, guaranteed the payment of principal of, premium, if
any, and interest on the Notes.
Reference is made to the further provisions of this Note contained
herein, which will for all purposes have the same effect as if set for that this
place.
48
IN WITNESS WHEREOF, the Company has caused this Note to be signed
manually or by facsimile by its duly authorized officers.
NORSKE SKOG CANADA LIMITED
By:
------------------------------------
Name:
Title:
Dated:
49
Certificate of Authentication
This is one of the 7-3/8% Senior Notes due 2014 referred to in the
within-mentioned Indenture.
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Trustee
By:
------------------------------------
Name:
Title:
Dated:
50
[FORM OF REVERSE OF NOTE]
NORSKE SKOG CANADA LIMITED
7-3/8% SENIOR NOTE DUE 2014
1. Interest. NORSKE SKOG CANADA LIMITED, a corporation incorporated
under the laws of Canada (the "Company"), promises to pay, until the principal
hereof is paid or made available for payment, interest on the principal amount
set forth on the face hereof at a rate of 7-3/8% per annum. Interest hereon will
accrue from and including the most recent date to which interest has been paid
or, if no interest has been paid, from and including March 23, 2004 to but
excluding the date on which interest is paid. Interest shall be payable in
arrears on each March 1 and September 1, commencing September 1, 2004. Interest
will be computed on the basis of a 360-day year consisting of twelve 30-day
months. The Company shall pay interest on overdue principal and on overdue
interest (to the full extent permitted by law) at a rate of 7-3/8% per annum.
2. Method of Payment. The Company will pay interest hereon (except
defaulted interest) to the Persons who are registered Holders at the close of
business on the February 15 or August 15 next preceding the interest payment
date (whether or not a Business Day). Holders must surrender Notes to a Paying
Agent to collect principal payments. The Company will pay principal and interest
in money of the United States of America that at the time of payment is legal
tender for payment of public and private debts. Interest may be paid by check
mailed to the Holder entitled thereto at the address indicated on the register
for the Notes maintained by the Security Registrar.
3. Paying Agent and Security Registrar. Initially, Wells Fargo Bank,
National Association (the "Trustee") will act as a Paying Agent and Security
Registrar. The Company may change any Paying Agent or Security Registrar without
notice. The Company or any of its Affiliates may act as Paying Agent or Security
Registrar.
4. Indenture. This Note is one of a duly authorized issue of Notes of
the Company, designated as its 7-3/8% Senior Notes due 2014 (herein called the
"Notes"). The Company issued the Notes under an Indenture dated as of March 23,
2004 (the "Indenture") among the Company, the Guarantors and the Trustee. This
is one of an issue of Notes of the Company issued, or to be issued, under the
Indenture. 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
(15 U.S. Code Sections 77aaa-77bbbb), as in effect on the date of the Indenture
(the "Act"). The Notes are subject to all such terms, and Holders are referred
to the Indenture and the Act for a statement of them. 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. Capitalized and
certain other terms used herein and not otherwise defined have the meanings set
forth in the Indenture. The Notes are general, unsecured obligations of the
Company.
51
5. Additional Amounts. The Company will pay to the Holders of Notes
such Additional Amounts as may become payable under Section 10.16 of the
Indenture.
6. Optional Redemption. The Company, at its option, may redeem the
Notes, in whole at any time, or in part from time to time on or after March
1,2009 upon not less than 30 nor more than 60 days' notice, at the redemption
prices (expressed as percentages of the aggregate principal amount thereof) set
forth below, together, in each case, with accrued and unpaid interest to the
Redemption Date, if redeemed during the twelve month period beginning on March 1
of each year listed below:
Year Redemption Price
- ---- ----------------
2009 .................. 103.688%
2010 .................. 102.458%
2011 .................. 101.229%
2012 and thereafter ... 100.000%
Notwithstanding the foregoing, the Company may redeem in the aggregate
up to 35% of the principal amount of Notes issued under this Indenture at any
time and from time to time prior to March 1,2007 at a redemption price equal to
107.375% of the aggregate principal amount so redeemed, plus accrued and unpaid
interest to the Redemption Date, out of the net cash proceeds of one or more
Public Equity Offerings; provided that at least 65% of the aggregate principal
amount of Notes issued under this Indenture remains outstanding immediately
after the occurrence of any such redemption and that any such redemption occurs
within 90 days following the closing of any such Public Equity Offering.
7. Tax Redemption. The Notes are redeemable, in whole but not in
part, at the option of the Company at any time, upon not less than 30 nor more
than 60 days' prior written notice, mailed by first class mail to each Holder at
its last address appearing in the register of Notes maintained by the Security
Registrar at 100% of the principal amount thereof plus accrued and unpaid
interest thereon to the Redemption Date, if the Company or any Guarantor is or
would become obligated to pay, on the next date on which any amount would be
payable with respect to the Notes or the Guarantees, any Additional Amounts as a
result of a change in, or amendment to, the laws (or any regulations promulgated
thereunder) of any Taxing Authority, or any changes in, or amendment to, any
official position regarding the application or interpretation of such laws or
regulations, which change or amendment is announced on or after the Issue Date;
provided that the Company or such Guarantor determines, in its business
judgment, that the obligation to pay such Additional Amounts cannot be avoided
by the use of reasonable measures available to the Company or such Guarantor
(not including substitution of the obligor under the Notes); and provided,
further, that (i) no such notice of redemption may be given earlier than 90 days
prior to the earliest date on which the Company or such Guarantor would but for
such redemption be obligated to pay such Additional Amounts or later than 270
days after the Company or such Guarantor first becomes liable to pay any
Additional Amounts as a result of any changes in or amendments to laws,
regulations or official positions described above and (ii) at the time such
notice is given, the Company's or such Guarantor's obligation to pay such
Additional Amounts remains in effect.
52
Prior to the publication of any notice of redemption pursuant to this
provision, the Company will deliver to the Trustee (a) an Officer's Certificate
stating that the Company is entitled to effect such redemption and setting forth
a statement of facts showing that the conditions precedent to the right of the
Company so to redeem have occurred and (b) an opinion of legal counsel qualified
under the laws of the relevant jurisdiction to the effect that the Company or
such Guarantor has or will become obligated to pay such Additional Amounts as a
result of such amendment or change as described above.
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 of
Notes to be redeemed at his registered address. On and after the Redemption
Date, unless the Company defaults in making the redemption payment, interest
ceases to accrue on Notes or portions thereof called for redemption, unless the
Company shall fail to redeem any Notes.
9. Offers to Purchase. The Indenture provides that upon the
occurrence of a Change of Control or an Asset Sale and subject to further
limitations contained therein, the Company shall make an offer to purchase
outstanding Notes in accordance with the procedures set forth in the Indenture.
10. Registration Rights. Pursuant to a Registration Rights Agreement
among the Company, the Guarantors and Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Bane of America Securities LLC, CIBC World Markets Corp., Scotia
Capital (USA) Inc., RBC Capital Markets Corporation, TD Securities, Inc., Harris
Nesbitt Corp., HSBC Securities (USA) Inc. and NBF Securities (USA) Corp., as
Initial Purchasers of the Notes, the Company and the Guarantors will be
obligated to consummate an exchange offer pursuant to which the Holder of this
Note shall have the right to exchange this Note for notes of a separate series
issued under the Indenture (or a trust indenture substantially identical to the
Indenture in accordance with the terms of the Registration Rights Agreement)
which have been registered under the Securities Act, in like principal amount
and having substantially identical terms as the Notes. The Holders shall be
entitled to receive certain additional interest payments in the event such
exchange offer is not consummated and upon certain other conditions, all
pursuant to and in accordance with the terms of the Registration Rights
Agreement.
11. Denominations, Transfer, Exchange. The Notes are in registered
form without coupons in denominations of US$1,000 and integral multiples of
US$1,000. A Holder may transfer or exchange Notes in accordance with the
Indenture. The Security Registrar may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents and to pay to it any
taxes and fees required by law or permitted by the Indenture. The Security
Registrar need not register the transfer of or exchange any Notes or portion of
a Note selected for redemption, or register the transfer of or exchange any
Notes for a period of 15 days before a mailing of notice of redemption.
12. Persons Deemed Owners. The registered Holder of this Note may be
treated as the owner of this Note for all purposes.
13. Unclaimed Money. If money for the payment of principal or
interest remains unclaimed for two years, the Trustee or Paying Agent will pay
the money back to the
53
Company at its written request. After that, Holders entitled to the money must
look to the Company for payment as general creditors unless an "abandoned
property" law designates another Person.
14. Amendment, Supplement, Waiver, Etc. The Company, any Guarantors
and the Trustee may, without the consent of the Holders of any outstanding
Notes, amend, waive or supplement the Indenture or the Notes for certain
specified purposes, including, among other things, curing ambiguities, defects
or inconsistencies, maintaining the qualification of the Indenture under the Act
and making any change that does not materially and adversely affect the rights
of any Holder. Other amendments and modifications of the Indenture or the Notes
may be made by the Company, any Guarantors and the Trustee with the consent of
the Holders of not less than a majority of the aggregate principal amount of the
outstanding Notes, subject to certain exceptions requiring the consent of the
Holders of the particular Notes to be affected.
15. Restrictive Covenants. The Indenture imposes certain limitations
on the ability of the Company and its Restricted Subsidiaries to, among other
things, incur additional Debt, make payments in respect of their Capital Stock
or certain Debt, make certain Investments, create or incur liens, enter in to
transactions with Affiliates, enter into agreements restricting the ability of
Restricted Subsidiaries to pay dividends and make distributions, issue Capital
Stock of any Restricted Subsidiaries of the Company, and on the ability of the
Company to merge or consolidate with any other Person or transfer all or
substantially all of the Company's or any Guarantor's assets. Such limitations
are subject to a number of important qualifications and exceptions. Pursuant to
Section 10.04 of the Indenture, the Company must annually report to the Trustee
on compliance with such limitations. Upon the occurrence of a Fall-away Event,
certain restrictive covenants in the Indenture will terminate as provided in
Section 10.17 of the Indenture.
16. Successor Corporation. When a successor corporation assumes all
the obligations of its predecessor under the Notes and the Indenture and the
transaction complies with the terms of Article Eight of the Indenture, the
predecessor corporation will, except as provided in Article Eight, be released
from those obligations.
17. Defaults and Remedies. Events of Default are set forth in the
Indenture. Subject to certain limitations in the Indenture, if an Event of
Default (other than an Event of Default specified in clause (6) or (7) of
Section 5.01 (a) of the Indenture with respect to the Company) occurs and is
continuing, the Trustee or the Holders of not less than 25% in aggregate
principal amount of the then outstanding Notes, by written notice to the Trustee
and the Company, may declare to be immediately due and payable the entire
principal amount of all the Notes then outstanding plus accrued and unpaid
interest to the date of acceleration and the same shall become immediately due
and payable. If an Event of Default specified in clause (6) or (7) of Section
5.01(a) of the Indenture occurs with respect to the Company, the principal
amount of and interest on, all Notes shall ipso facto become and be immediately
due and payable without any declaration or other act on the part of the Trustee
or any Holder. Holders may not enforce the Indenture or the Notes except as
provided in the Indenture. The Trustee may require indemnity satisfactory to it
before it enforces the Indenture or the Notes. 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 with
hold from Holders notice
54
of any continuing default (except a default in payment of principal, premium, if
any, or interest or a default in the observance or performance of any of the
obligations of the Company under Article Five of the Indenture) if it determines
that withholding notice is in their best interests.
18. 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 Trustee.
19. No Recourse Against Others. No past, present or future director,
officer, employee, partner, incorporator or shareholder, of the Company or any
Guarantor or any corporate successor thereto shall have any liability for any
obligations of the Company under the Notes, the Guarantees, the Indenture or for
a claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder of Notes by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Notes.
20. Discharge. The Company's obligations pursuant to the
Indenture will be discharged, except for obligations pursuant to certain
sections thereof, subject to the terms of the Indenture, upon the payment of all
the Notes or upon the irrevocable deposit with the Trustee of money in United
States dollars or U.S. Government Securities sufficient to pay when due
principal of and interest on the Notes to maturity or redemption, as the case
may be.
21. Guarantees. The Note is entitled to the benefits of certain
Guarantees made for the benefit of the Holders. Reference is hereby made to the
Indenture for a statement of the respective rights, limitations of rights,
duties and obligations thereunder of the Guarantors, the Trustee and the
Holders.
22. Authentication. This Note shall not be valid until the Trustee
signs the certificate of authentication on the other side of this Note.
23. Governing Law. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
The Company and the Guarantors agree to submit to the jurisdiction of
the courts of the State of New York in any action or proceeding arising out of
or relating to the Indenture or the Notes.
24. Abbreviations. Customary abbreviations may be used in the name of
a Holder or an assignee, such as: TEN COM (= tenants in common), TENANT (=
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).
25. 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
55
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.
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture. Requests may be made to:
NORSKE SKOG CANADA LIMITED
16th Floor
250 Howe Street
Vancouver, British Columbia V6C 3R8
CANADA
Attention: Corporate Secretary
56
ASSIGNMENT
I or we assign and transfer this Note to:
(Insert assignee's social security or tax I.D. number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip or postal code of assignee)
and irrevocably appoint:
________________________________________________________________________________
________________________________________________________________________________
Agent to transfer this Note on the books of the Company. The Agent may
substitute another to act for him.
Date: Your Signature:
----------------- -----------------------------
(Sign exactly as your name
appears on the other side
of this Note)
- ------------------------------------
Signature Guaranteed
(Signature must be guaranteed by a
participant in a recognized
signature guaranty medallion
program or other signature guarantor
acceptable to the Trustee)
57
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Note purchased by
the Company pursuant to Section 10.10 or Section 10.15 of the Indenture, check
the appropriate box:
[ ] Section 10.10 [ ] Section 10.15
If you want to have only part of the Note purchased by the Company
pursuant to Section 10.10 or Section 10.15 of the Indenture, state the amount
you elect to have purchased:
US$___________________
(multiple of US$1,000)
Date:
------------
Your Signature:
------------------------
(Sign exactly as your name appears on
the face of this Note)
- -------------------------------------
Signature Guaranteed
(Signature must be guaranteed by a
participant in a recognized signature
guaranty medallion program or other
signature guarantor acceptable to
the Trustee)
SECTION 2.05 Book-Entry Provisions for Global Notes
(a) The Notes offered and sold in their original distribution in
reliance on Rule 144A shall be issued in the form of one or more Global
Securities in definitive, fully registered form without interest coupons,
substantially in the form of Security set forth in Section 2.04, with such
applicable legends as are provided for in Section 2.04, except as otherwise
permitted herein, and shall be registered in the name of the U.S. Depositary or
its nominee and deposited with the Trustee, at its Corporate Trust Office, as
custodian for the U.S. Depositary, or such other office of the Trustee or its
affiliate at which its corporate trust operations as custodian for the U.S.
Depositary are conducted, duly executed by the Company and authenticated by the
Trustee as hereinafter provided, for credit by the U.S. Depositary to the
respective accounts of beneficial owners of the Securities represented thereby
(or such other accounts as they may direct). Such Global Securities, together
with their Successor Securities which are Global Securities other than the
Regulation S Global Security (as defined herein), are collectively herein called
the "Restricted Global Security." The aggregate stated amount at maturity of the
Restricted Global Security may from time to time be increased or decreased by
adjustments made on the records of the Trustee, as custodian for the U.S.
Depositary, in connection with a corresponding decrease or increase in the
aggregate stated amount at maturity of the Regulation S Global Security, as
hereinafter provided.
58
(b) The Notes offered and sold in reliance on Regulation S shall be
issued in the form of one or more Global Securities (collectively, the
"Regulation S Global Security") in definitive, fully registered form without
interest coupons, substantially in the form of Security set forth in Section
2.04, with such applicable legends as are provided for in Section 2.04, except
as otherwise permitted herein. Such Global Securities shall be registered in the
name of the U.S. Depositary or its nominee and deposited with the Trustee, at
its Corporate Trust Office, as custodian for the U.S. Depositary, or such other
office of the Trustee or its affiliate at which its corporate trust operations
as custodian for the US Depositary are conducted, duly executed by the Company
and authenticated by the Trustee as hereinafter provided, for credit to the
respective accounts at the U.S. Depositary of the depositories for Morgan
Guaranty Trust Company of New York, Brussels office, as operator of the Euro
clear Clearance System ("Euroclear"), or for Clearstream Banking, societe
anonyme ("Clearstream"), in turn for credit to the respective accounts of
beneficial owners of the Securities represented thereby (or such other accounts
as they may direct) in accordance with the rules thereof. The aggregate stated
amount at maturity of the Regulation S Global Security may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for the U.S. Depositary, in connection with a corresponding decrease
or increase in the aggregate stated amount at maturity of the Restricted Global
Security, as hereinafter provided.
(c) Neither members of, nor direct or indirect participants in, DTC
("DTC Agent Members") shall have any rights under this Indenture with respect to
any Global Note held on their behalf by DTC, or the Trustee as its custodian, or
under the Global Notes, and DTC may be treated by the Company, the Trustee and
any agent of the Company or the Trustee as the absolute owner of such Global
Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein
shall prevent the Company, the Trustee or any agent of the Company or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by DTC or impair, as between DTC and DTC Agent Members,
the operation of customary practices governing the exercise of the rights of a
Holder of any Note.
ARTICLE III
THE SECURITIES
SECTION 3.01 Title and Terms.
(a) The Trustee shall authenticate Notes for original issue on the
Issue Date in the aggregate principal amount of US$ 250,000,000 upon receipt of
a written order of the Company in the form of an Officers' Certificate of the
Company. Thereafter, subject to compliance with Section 3.03, at any time and
from time to time, the Trustee shall authenticate Notes having identical terms
(except as to issue price) in an unlimited amount upon a written order of the
Company in the form of an Officers' Certificate of the Company. In each case,
such written order shall specify the amount of Notes to be authenticated and the
date on which the Notes are to be authenticated.
(b) Upon receipt of a Company Request and an Officers' Certificate of
the Company certifying that a registration statement relating to an exchange
offer specified in the Registration Rights Agreement is effective under the
Securities Act and that the conditions
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precedent to a Private Exchange thereunder have been met, the Trustee shall
authenticate an additional series of Notes for issuance in exchange for the
Notes tendered for exchange pursuant to such exchange offer registered under the
Securities Act or pursuant to a Private Exchange. Such additional series of
Notes issued in such exchange shall be deemed to be a single series of Notes
outstanding under this Indenture. Exchange Securities or Private Exchange
Securities may have such distinctive series designations and such changes in the
form there of as are specified in the Company Request referred to in the
preceding sentence.
(c) The principal amount of, premium (if any), and interest on the
Securities shall be payable at the office or agency of the Company in the City
of New York, New York maintained for such purpose or at any other office or
agency maintained by the Company for such purpose; provided, however, that at
the option of the Company payment of interest may be made by check mailed to the
address of the Person entitled thereto as such address shall appear in the
Security Register.
(d) The Securities shall be subject to repurchase by the Company
pursuant to an offer to purchase as provided in Sections 10.10 and 10.15.
(e) The Securities shall be redeemable as provided in Article Eleven.
(f) The Securities shall be subject to defeasance at the option of the
Company as provided in Article Twelve.
(g) Unless the context otherwise requires, the Notes and the Exchange
Securities shall constitute one series for all purposes under this Indenture,
including with respect to any amendment, waiver, acceleration or other Act of
Holders, redemption or offer to purchase.
SECTION 3.02 Denominations. The Securities shall be issuable only in
registered form without coupons and only in denominations of $1,000 and any
integral multiple thereof.
SECTION 3.03 Execution, Authentication, Delivery and Dating.
(a) The Securities shall be executed on behalf of the Company by one
Officer of the Company. The signature of any of the Officer on the Securities
may be manual or facsimile.
(b) Securities bearing the manual or facsimile signatures of an
individual who was at anytime the proper Officer of the Company shall bind the
Company, notwithstanding that the individual has ceased to hold such office
prior to the authentication and delivery of such Securities or did not hold such
offices at the date of the Securities.
(c) At anytime and from time to time after the execution and delivery
of this Indenture, the Company may deliver Notes executed by the Company to the
Trustee for authentication, together with a Company Order for the authentication
and delivery of such Notes; and the Trustee in accordance with such Company
Order shall authenticate and deliver such Notes as in this Indenture provided
and not otherwise.
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(d) At any time and from time to time after the execution and delivery
of this Indenture and after the effectiveness of a registration statement under
the Securities Act with respect there to, the Company may deliver Exchange
Securities executed by the Company to the Trustee for authentication, together
with a Company Order for the authentication and delivery of such Exchange
Securities, and the Trustee in accordance with the Company Order shall
authenticate and deliver such Securities. Each such Company Order shall be
accompanied by an Opinion of Counsel stating in substance that all conditions
hereunder precedent to the authentication and delivery of such Exchange
Securities have been complied with and that such Exchange Securities have been
duly executed and, when such Securities have been duly authenticated and
delivered by the Trustee, will be duly issued and delivered and will constitute
valid and legally binding obligations of the Company, enforceable in accordance
with their terms, subject to any applicable bankruptcy, insolvency (including,
without limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or similar laws affecting creditors' rights generally and subject to
the effect of general principles of equity, including, without limitation,
concepts of materiality, reasonableness, good faith and fair dealing (regardless
of whether enforcement is considered in a proceeding in equity or at law).
(e) Each Security shall be dated the date of its authentication.
(f) No Security shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose unless there appears on such Security
a certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder. Notwithstanding the
foregoing, if any Note shall have been authenticated and delivered hereunder
but never issued and sold by the Company, and the Company shall deliver such
Note to the Trustee for cancellation as provided in Section 3.13, for all
purposes of this Indenture such Note shall be deemed never to have been
authenticated and delivered hereunder and shall never be entitled to the
benefits of this Indenture.
Upon prior notice to, and approval by (which approval shall not be
unreasonably withheld), the Company, the Trustee may appoint an authenticating
agent to authenticate the Notes. Unless otherwise provided in the appointment,
an authenticating agent may authenticate the Notes whenever the Trustee may do
so. Each reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as an
Agent to deal with the Company and Affiliates of the Company. Each Paying Agent
is designated as an authenticating agent for purposes of this Indenture.
(g) In case the Company, pursuant to Article Eight, shall be
amalgamated, consolidated or merged with or into any other Person or shall
convey, transfer, lease or otherwise dispose of substantially all of its
properties and assets to any Person, and the successor Person resulting from
such amalgamation, consolidation, or surviving such merger, or into which the
Company shall have been merged, or the success or Person which shall have
received a conveyance, transfer, lease or other disposition as aforesaid, shall
have executed an indenture supplemental hereto with the Trustee pursuant to
Article Eight, any of the Securities authenticated or delivered prior to such
amalgamation, consolidation, merger, conveyance, transfer, lease or other
disposition may, from time to time, at the request of the success or Person,
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be exchanged for other Securities executed in the name of the successor Person
with such changes in phraseology and form as may be appropriate, but otherwise
in substance of like tenor as the Securities surrendered for such exchange and
of like principal amount; and the Trustee upon Company Order of the successor
Person, shall authenticate and deliver replacement Securities as specified in
such request for the purpose of such exchange. If replacement Securities shall
at any time be authenticated and delivered in any new name of a successor Person
pursuant to this Section in exchange or substitution for or upon registration of
transfer of any Securities, such successor Person, at the option of any Holder
but without expense to such Holder, shall provide for the exchange of all
Securities at the time outstanding held by such Holder for Securities
authenticated and delivered in such new name.
SECTION 3.04 Temporary Securities.
(a) Pending the preparation of definitive Securities, the Company may
execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Securities in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Securities may determine, as evidenced by their
execution of such Securities.
(b) If temporary Securities are issued, the Company will cause
definitive Securities to be prepared without unreasonable delay. After the
preparation of definitive Securities, the temporary Securities shall be
exchangeable for definitive Securities upon surrender of the temporary
Securities at any office or agency of the Company designated pursuant to Section
1.15, without charge to the Holder. Upon surrender for cancellation of any one
or more temporary Securities the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Securities of authorized denominations. Until so exchanged the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities.
SECTION 3.05 Defaulted Interest. If the Company defaults on a payment
of interest on the Notes, it shall pay the defaulted interest in any lawful
manner, plus (to the extent permitted by law) any interest payable on the
defaulted interest, in accordance with paragraph 1 of the Notes, to the Persons
who are Holders on a subsequent special record date, which date shall be at
least five Business Days prior to the payment date. The Company shall fix such
special record date and payment date in a manner satisfactory to the Trustee. At
least 10 days before such special record date, the Company shall mail to each
Holder a notice that states the special record date, the payment date and the
amount of defaulted interest, and interest payable on defaulted interest, if
any, to be paid. The Company may make payment of any defaulted interest in any
other lawful manner not inconsistent with the requirements (if applicable) of
any securities exchange on which the Notes may be listed and, upon such notice
as may be required by such exchange, if, after written notice given by the
Company to the Trustee of the proposed payment pursuant to this sentence, such
manner of payment shall be deemed practicable by the Trustee.
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SECTION 3.06 Deposit of Moneys. Prior to 10:00 a.m., New York City
time, on each Interest Payment Date and the Maturity Date, the Company shall
have deposited with the Paying Agent in immediately available funds money
sufficient to make cash payments due on such Interest Payment Date or the
Maturity Date, as the case may be, in a timely manner which permits the Trustee
to remit payment to the Holders on such Interest Payment Date or the Maturity
Date, as the case may be. Except as otherwise provided herein, the principal
and interest on Global Notes, shall be payable to DTC or the nominee of DTC, as
the case may be, as the sole registered owner and the sole holder of the Global
Notes represented thereby. The principal and interest on Physical Notes shall
be payable, either in person or by mail, at the office of the Paying Agent.
SECTION 3.07 Registration, Registration of Transfer and Exchange
Generally; Restrictions on Transfer and Exchange; Securities Act Legends.
(a) Registration, Registration of Transfer and Exchange Generally.
(1) The Company shall cause to be kept at the Corporate Trust
Office of the Trustee a register (the register maintained in such office
and in any other office or agency designated pursuant to Section 1.15 being
herein sometimes collectively referred to as the "Security Register") in
which, subject to such reasonable regulations as it may prescribe, the
Company shall provide for the registration of Securities and of transfers
and exchanges of Securities. The Trustee is hereby appointed "Security
Registrar" for the purpose of registering Securities and transfers and
exchanges of Securities as herein provided. Such Security Register shall
distinguish between Notes and Exchange Securities.
(2) Upon surrender for registration of transfer of any Notes at
an office or agency of the Company designated pursuant to Section 1.15 for
such purpose, the Company shall execute, and the Trustee shall authenticate
and deliver, in the name of the designated transferee or transferees, one
or more new Securities of any authorized denominations and of a like
aggregate principal amount of Notes bearing such restrictive legends as may
be required by this Indenture.
(3) At the option of the Holder, and subject to the other
provisions of this Section 3.07, Notes may be exchanged for other
Securities of any authorized denominations and of a like aggregate
principal amount, upon surrender of the Securities to be exchanged at such
office or agency. Whenever any Securities are so surrendered for exchange,
and subject to the other provisions of this Section 3.07, the Company shall
execute, and the Trustee shall authenticate and deliver, the Securities
which the Holder making the exchange is entitled to receive.
(4) All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of the Company,
evidencing the same debt, and (except for the differences between Notes and
Exchange Securities provided for in this Indenture) entitled to the same
benefits under this Indenture, as the Securities surrendered upon such
registration of transfer or exchange.
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(5) Every Security present or surrendered for registration of
transfer or for exchange shall (if so required by the Company or the
Security Registrar) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar duly executed, by the Holder thereof or his attorney duly
authorized in writing.
(6) No service charge shall be made for any registration of
transfer or exchange of Securities, but the Company may require payment of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any registration of transfer or exchange of
Securities, other than exchanges pursuant to Sections 3.04, 9.05, 11.06 or
in accordance with any offer to purchase pursuant to Section 10.10 or 10.15
not involving any transfer.
(7) The Company shall not be required(i) to issue, register the
transfer of or exchange any Security during a period beginning at the
opening of business 15 days before the day of the mailing of a notice of
redemption of Securities selected for redemption under Section 11.04 and
ending at the close of business on the day of such mailing, or (ii) to
register the transfer of or exchange any Security so selected for
redemption in whole or in part, except the unredeemed portion of any
Security being redeemed in part.
(b) Certain Transfers and Exchanges.
(1) Notwithstanding any other provisions of this Indenture or the
Securities, transfers and exchanges of Securities and beneficial interests
in a Global Security of the kinds specified in this Section 3.07(b) shall
be made only in accordance with this Section 3.07(b). Transfers and
exchanges subject to this Section 3.07(b) shall also be subject to the
other provisions of this Indenture that are not inconsistent with this
Section 3.07(b). Each Holder of a Note agrees to indemnify the Company and
the Trustee against any liability that may result from the transfer,
exchange or assignment of such Holder's Note in violation of any provision
of this Indenture and/or applicable U.S. federal or state securities laws
or Canadian provincial securities laws.
(2) Unless and until (A) Notes are sold under an effective
Registration Statement, or (B) Notes are exchanged for an Exchange Security
in connection with an effective Registration Statement, pursuant to the
Registration Rights Agreement, the following provisions shall apply:
(i) Restricted Global Security to Regulation S Global
Security. If the holder of a beneficial interest in the Restricted
Global Security wishes at anytime to transfer such interest to a
Person who is required or permitted to take delivery thereof in
the form of a beneficial interest in the Regulation S Global Security,
such transfer may be effected, subject to the rules and procedures of
the U.S. Depositary, Euroclear and Clearstream, in each case to the
extent applicable (the "Applicable Procedures"), only in accordance
with the provisions of this Section 3.07(b)(2)(i). Upon receipt by the
Trustee, as Security Registrar, of (A) written instructions given in
accordance with the Applicable Procedures from
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any member of, or direct participants in, the U.S. Depositary ("Agent
Members") directing the Trustee to credit or cause to be credited to a
specified Agent Member's account a beneficial interest in the
Regulation S Global Security in a principal amount equal to that of
the beneficial interest in the Restricted Global Security to be so
transferred, (B) a written order given in accordance with the
Applicable Procedures containing in formation regarding the account of
the Agent Member (and the Euroclear or Clearstream account, as the
case may be) to be credited with, and the account of the Agent Member
to be debited for, such beneficial interest and (C) a Regulation S
Certificate, substantially in the form of Annex A hereto given by the
holder of such beneficial interest, the principal amount of the
Restricted Global Security shall be reduced, and the principal amount
of the Regulation S Global Security shall be increased, by the
principal amount of the beneficial interest in the Restricted Global
Security to be so transferred, in each case by means of an appropriate
adjustment on the records of the Trustee, as Security Registrar, and
the Trustee, as Security Registrar, shall instruct the U.S. Depositary
or its authorized representative to make a corresponding adjustment to
its records and to credit or cause to be credited to the account of
the Person specified in such instructions (which shall be the Agent
Member for Euroclear or Clearstream or both, as the case may be) a
beneficial interest in the Regulation S Global Security having a
principal amount equal to the amount so transferred.
(ii) Regulation S Global Security to Restricted Global
Security. If the holder of a beneficial interest in the Regulation S
Global Security wishes at any time to transfer such interest to a
Person who is required or permitted to take delivery thereof in the
form of a beneficial interest in the Restricted Global Security, such
transfer may be effected, subject to the Applicable Procedures, only
in accordance with this Section 3.07(b)(2)(ii). Upon receipt by the
Trustee, as Security Registrar, of (A) written instructions given in
accordance with the Applicable Procedures from an Agent Member
directing the Trustee to credit or cause to be credited to a specified
Agent Member's account a beneficial interest in the Restricted Global
Security in a principal amount equal to that of the beneficial
interest in the Regulation S Global Security to be so transferred, (B)
a written order given in accordance with the Applicable Procedures
containing information regarding the account of the Agent Member to be
credited with, and the account of the Agent Member (and, if
applicable, the Euroclear or Clearstream account, as the case may be)
to be debited for, such beneficial interest and (C) a Restricted
Securities Certificate, substantially in the form of Annex B hereto
given by the holder of such beneficial interest, the principal amount
of the Restricted Global Security shall be reduced, and the principal
amount of the Regulation S Global Security shall be increased, by the
principal amount of the beneficial interest in the Restricted Global
Security to be so transferred, in each case by means of an appropriate
adjustment on the records of the Trustee, as Security Registrar, and
the Trustee, as Security Registrar, shall instruct the U.S. Depositary
or its authorized representative to make a corresponding adjustment to
its records and to credit or cause to be credited to the account of
the Person
65
specified in such instructions a beneficial interest in the Regulation
S Global Security having a principal amount equal to the amount so
transferred.
(iii) Non-Global Security for Non-Global Security. A
Security that bears a Securities Act legend that is not a Global
Security may be transferred, in whole or in part, to a Person who
takes delivery in the form of another Security that is not a Global
Security as provided in Section 3.07(a), provided that, if the
Security to be transferred in whole or in part is a Restricted
Security, or is a Regulation S Security, then the Trustee shall have
received (A) a Restricted Securities Certificate substantially in the
form attached hereto as Annex A and duly executed by the transferor
Holder or his attorney duly authorized in writing, in which case the
transferee Holder shall take delivery in the form of a Restricted
Security, or (B) a Regulation S Certificate, substantially in the form
attached hereto as Annex B and duly executed by the transferee Holder
of his attorney duly authorized in writing, in which case the
transferee Holder shall take delivery in the form of a Regulation S
Security (subject in each case to Section 3.07(c)).
(iv) Interests in Regulation S Global Security to be Held
Through Euroclear or Clearstream. Interests in the Regulation S
Global Security may be held only through Agent Members acting for and
on behalf of Euroclear and Clearstream, provided that this clause(iv)
shall not prohibit any transfer in accordance with Section
3.07(b)(2)(ii) hereof.
(c) Securities Act Legends. Restricted Securities and their Successor
Securities shall bear a Private Placement Legend and Regulation S Securities and
their Successor Securities shall bear a Private Placement Legend, subject to the
following:
(1) subject to the following clauses of this Section 3.07(c), a
Security or any portion thereof which is exchanged, upon transfer or
otherwise, for a Global Security or any portion thereof shall bear the
Securities Act Legend borne by such Global Security while represented there
by;
(2) subject to the following clauses of this Section 3.07(c), a
new Security which is not a Global Security and is issued in exchange for
another Security (including a Global Security) or any portion thereof, upon
transfer or otherwise, shall bear the Securities Act legend borne by such
other Security, provided that, if such new Security is required pursuant to
Section 3.07(b)(2)(iii) to be issued in the form of a Restricted Security,
it shall bear a Restricted Securities Legend and, if such new Security is
so required to be issued in the form of a Regulation S Security, it shall
bear a Private Placement Legend;
(3) Securities that are sold or otherwise disposed of pursuant to
an effective registration statement under the Securities Act (including the
shelf registration contemplated by the Registration Rights Agreement) shall
not bear a Securities Act Legend;
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(4) notwithstanding the foregoing provisions of this Section
3.07(c), a Successor Security of a Security that does not bear a particular
form of Securities Act Legend shall not bear such form of legend unless the
Company has reasonable cause to believe that such Successor Security is a
"restricted security" within the meaning of Rule 144, in which case the
Trustee, at the direction of the Company, shall authenticate and deliver a
new Security bearing a Private Placement Legend in exchange for such
Successor Security as provided in this Article Three;
(5) Until Securities are sold pursuant to an effective
registration statement under the Securities Act (including the shelf
registration contemplated by the Registration Rights Agreement), no
Securities may be transferred except pursuant to Rule 144A or Regulation S
under the Securities Act. The Trustee shall have no duty or liability with
respect to any Holder's or beneficial owner's compliance with Rule 144A or
Regulation S, as applicable; and
(6) Exchange Securities and their respective Successor Securities
shall not bear a Securities Act Legend.
(d) The provisions of this Section 3.07(d) shall apply only to Global
Securities:
(1) Each Global Security authenticated under this Indenture shall
be registered in the name of the U.S. Depositary or a nominee thereof and
delivered to the U.S. Depositary or a nominee thereof or custodian
therefor, and each such Global Security shall constitute a single Security
for all purposes of this Indenture.
(2) Notwithstanding any other provision in this Indenture or the
Securities, no Global Security may be exchanged in whole or in part for
Securities registered, and no transfer of a Global Security in whole or in
part may be registered, in the name of any Person other than the U.S.
Depositary or a nominee thereof unless (A) the U.S. Depositary (i) has
notified the Company that it is unwilling or unable to continue as U.S.
Depositary for such Global Security or (ii) has ceased to be a clearing
agency registered under the Exchange Act, and in either case the Company
thereupon fails to appoint a successor depositary within 120 days of such
notice, (B) the Company, at its option, executes and delivers to the
Trustee a Company Order that such Global Security shall be exchanged in
whole for Securities that are not Global Securities, or (C) there shall
have occurred and be continuing an Event of Default with respect to such
Global Security.
(3) Securities issued in exchange for a Global Security or any
portion thereof pursuant to clause (2) of this Section 3.07(d) shall be
issued in definitive, fully registered form, without interest coupons,
shall have an aggregate principal amount equal to that of such Global
Security or portion thereof to be so exchanged, shall be registered in such
names and be in such authorized denominations as the U.S. Depositary shall
designate and shall bear any legends required hereunder. Any Global
Security to be exchanged in whole shall be surrendered by the U.S.
Depositary to the Trustee, as Security Registrar. With regard to any Global
Security to be exchanged in part, either
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such Global Security shall be so surrendered for exchange or, if the
Trustee is acting as custodian for the U.S. Depositary or its nominee with
respect to such Global Security, the principal amount thereof shall be
reduced, by an amount equal to the portion thereof to be so exchanged, by
means of an appropriate adjustment made on the records of the Trustee. Upon
any such surrender or adjustment, the Trustee shall authenticate and
deliver the Security issuable on such exchange to or upon the order of the
U.S. Depositary or an authorized representative thereof.
(4) In the event of the occurrence of any of the events specified
in clause (2) of this Section 3.07(d), the Company will promptly make
available to the Trustee a reasonable supply of certificated Securities in
definitive, fully registered form, without interest coupons.
(5) Neither any Agent Members nor any other Persons on whose
behalf Agent Members may act (including Euroclear and Clearstream and
account holders and participants therein) shall have any rights under this
Indenture with respect to any Global Security, or under any Global
Security, and the U.S. Depositary or such nominee, as the case may be, may
be treated by the Company, the Trustee and any agent of the Company or the
Trustee as the absolute owner and Holder of such Global Security for all
purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Company, the Trustee or any agent of the Company or the Trustee
from giving effect to any written certification, proxy or other
authorization furnished by the U.S. Depositary or such nominee, as the case
may be, or impair, as between the U.S. Depositary, its Agent Members and
any other person on whose behalf an Agent Member may act, the operation of
customary practices of such Persons governing the exercise of the rights of
a Holder of any Security.
SECTION 3.08 Mutilated, Destroyed, Lost and Stolen Securities. (a) If
any mutilated Security is surrendered to the Trustee, the Company shall execute
and the Trustee shall authenticate and deliver in exchange therefor a new
Security of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
(b) If there shall be delivered to the Company and the Trustee (1)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (2) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and upon its request the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen
Security, a new Security of like tenor and principal amount and bearing a number
not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or will become within 30 days, due and payable, the Company in its
discretion may, instead of issuing a new Security, pay such Security.
(c) Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that
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may be imposed in relation thereto and any other expenses (including the fees
and expenses of the Trustee) connected therewith.
(d) Every new Security issued pursuant to this Section in lieu of any
mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities duly issued hereunder.
(e) The provisions of this Section are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 3.09 Outstanding Notes. (a) The Notes outstanding at any time
are all Notes that have been authenticated by the Trustee except for (1) those
cancelled by it, (2) those delivered to it for cancellation, (3) to the extent
set forth in Sections 12.02 and 12.03 hereof, on or after the date on which the
conditions set forth in Section 12.02 or 12.03 hereof have been satisfied, those
Notes theretofore authenticated and delivered by the Trustee hereunder and (4)
those described in this Section 3.09 hereof as not outstanding. Subject to
Section 3.15 hereof, a Note does not cease to be outstanding because the Company
or one of its Affiliates holds the Note.
(b) If a Note is replaced pursuant to Section 3.08 hereof, it ceases
to be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser in whose hands such Note is a
legal, valid and binding obligation of the Company.
(c) If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, in its capacity as such, on any Maturity Date
or on any optional redemption date, money sufficient to pay all accrued interest
and principal with respect to the Notes payable on that date and is not
prohibited from paying such money to the Holders thereof pursuant to the terms
of this Indenture, then on and after that date such Notes cease to be
outstanding and interest on them ceases to accrue.
SECTION 3.10 Computation of Interest. (a) Interest on the Notes shall
be computed on the basis of a 360-day year consisting of twelve 30-day months.
(b) For the purposes of the Interest Act (Canada) where any interest
payable hereunder or under the Notes is expressed to be computed on the basis of
a 360-day year of twelve 30-day months, the annual rate of interest to which
such stated rate is equivalent is calculable by determining, on the following
basis for the relevant period, the amount of interest accruing during such
period and expressing such amount as a percentage of the outstanding principal
multiplied by the number of days in such period and divided by the number of
days in the year (being 365 or 366, as the case maybe):
(1) for any complete calendar month in respect of which such rate is
applicable, the stated rate
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(A) multiplied by the actual number of days in the year in which
such month falls and divided by the actual number of days in the
month, and
(B) multiplied by 30 and divided by 360, and
(2) for any part of a calendar month in respect of which such rate is
applicable, the stated rate multiplied by the actual number of days in any
applicable year, being 365 or 366, as the case may be and divided by 360.
SECTION 3.11 Payment of Interest; Interest Rights Preserved.
(a) Interest on any Security which is payable, and is punctually paid
or duly provided for, on any Interest Payment Date shall be paid to the Person
in whose name that Security (or one or more Predecessor Securities) is
registered at the close of business on the regular record date for such
interest.
(b) Any interest on any Security which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant regular record date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in clause (1) or (2)of this Section 3.1l(b):
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities (or their respective
Predecessor Securities) are registered at the close of business on a
special record date for the payment of such Defaulted Interest, which shall
be fixed in the following manner. The Company shall notify the Trustee in
writing of the amount of Defaulted Interest proposed to be paid on each
Security and the date of the proposed payment, and at the same time the
Company shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted Interest
or shall make arrangements satisfactory to the Trustee for such deposit
prior to the date of the proposed payment, such money when deposited to be
held in trust for the benefit of the Persons entitled to such Defaulted
Interest as in this clause provided. Thereupon the Trustee shall fix a
special record date for the payment of such Defaulted Interest which shall
be not more than 15 days and not less than 10 days prior to the date of the
proposed payment and not less than 10 days after the receipt by the Trustee
of the notice of the proposed payment. The Trustee shall promptly notify
the Company of such special record date and, in the name and at the
expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the special record date therefor to be mailed,
first-class postage prepaid, to each Holder at his address as it appears in
the Security Register, not less than 10 days prior to such special record
date. Notice of the proposed payment of such Defaulted Interest and the
special record date therefor having been so mailed, such Defaulted
Interest shall be paid to the Persons in whose names the Securities (or
their respective Predecessor Securities) are registered at the close of
business on such special record date and shall no longer be payable
pursuant to clause (2) of this Section 3.ll(b).
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(2) The Company may make payment of any Defaulted Interest in any
other lawful manner not in consistent with the requirements of any
securities exchange on which the Securities may be listed, and upon such
notice as may be required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this clause,
such manner of payment shall be deemed practicable by the Trustee.
(c) Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.
SECTION 3.12 Persons Deemed Owners. Prior to due presentment of a
Security for registration of transfer, the Company, the Trustee and any agent of
the Company or the Trustee may treat the Person in whose name such Security is
registered as the owner of such Security for the purpose of receiving, subject
to Section 3.11, payment of interest on such Security and for all other purposes
whatsoever, whether or not such Security be overdue, and neither the Company,
the Trustee nor any agent of the Company or the Trustee shall be affected by
notice to the contrary.
SECTION 3.13 Cancellation. All Securities surrendered for payment,
redemption, registration of transfer or exchange or for credit against any offer
to purchase pursuant to Section 10.10 or 10.15 shall, if surrendered to any
Person (including the Security Registrar or the Paying Agent) other than the
Trustee, be delivered to the Trustee and shall be promptly cancelled by it. The
Company shall deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in any
manner whatsoever, and all Securities so delivered shall be promptly cancelled
by the Trustee. No Securities shall be authenticated in lieu of or in exchange
for any Securities cancelled as provided in this Section, except as expressly
permitted by this Indenture. All cancelled Securities held by the Trustee shall
be disposed of by the Trustee in accordance with its customary procedures and
certification of their disposal delivered to the Company.
SECTION 3.14 CUSIP or ISIN Numbers. The Company in issuing the
Securities may use "CUSIP" or "ISIN" numbers and, if so, the Trustee shall use
CUSIP or ISIN numbers in notices of redemption and other notices to Holders as a
convenience to Holders; provided, however, that any such notice may state that
no representation is made as to the correctness of such numbers either as
printed on the Securities or as contained in any notice of a redemption or other
notice and that reliance may be placed only on the other identification numbers
printed on the Securities, and any such redemption or notice shall not be
affected by any defect in or such omission of such numbers. The Company shall
promptly notify the Trustee of any such CUSIP or ISIN number used by the Company
in connection with the issuance of the Notes and of any change in the CUSIP or
ISIN number.
SECTION 3.15 Treasury Notes. In determining whether the Holders of
the required aggregate principal amount of Notes have concurred in any
declaration of acceleration or notice of default or direction, waiver or consent
or any amendment, modification or other change to this Indenture, Notes owned by
the Company or any Person directly or indirectly
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controlling or controlled by or under common control with the Company shall be
disregarded as though they were not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent or any amendment, modification or other change to
this Indenture, only Notes as to which the Trustee has received an Officers'
Certificate of the Company stating that such Notes are so owned shall be so
disregarded. Notes so owned which have been pledged in good faith shall not be
disregarded if the pledgee established to the satisfaction of the Trustee the
pledgee's right so to act with respect to the Notes and that the pledgee is not
the Company, a Guarantor, any other obligor on the Notes or any of their
respective Affiliates.
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.01 Satisfaction and Discharge of Indenture.
(a) This Indenture shall cease to be of further effect (except as to
any surviving rights of registration of transfer or exchange of Securities
herein expressly provided for), and the Trustee, upon a Company Order and at the
expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture (including, but not limited
to, Article Twelve), when:
(1) either,
(A) all Securities theretofore authenticated and delivered
(other than Securities which have been destroyed, lost or
stolen and which have been replaced or paid as provided in
Section 3.08 and Notes for whose payment money has
theretofore been irrevocably deposited in trust or
segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust) have
been delivered to the Trustee for cancellation; or
(B) all such Securities not theretofore delivered to the Trustee
for cancellation,
(i) have become due and payable, or
(ii) are to be called for redemption within one year
under arrangements satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the
name, and at the expense, of the Company,
and the Company, in the case of subclause (i) or (ii) of
this Section 4.01(a)(l)(B), has deposited or caused to be
deposited with the Trustee as trust funds in trust for the
purpose an amount sufficient to pay and discharge the entire
indebtedness on such Securities not theretofore delivered to
the Trustee for cancellation, for principal of, premium, if
any, and interest on the Notes to the
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date of maturity or Redemption Date, as the case may be
together with irrevocable instructions from the Company
directing the Trustee to apply such funds to the payment
thereof at the maturity or redemption, as the case may be;
(2) the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of
this Indenture have been complied with.
(b) Notwithstanding the first paragraph of this Section 4.01, the
Company's obligations under Sections 3.07, 3.08, 3.09, 6.07, 7.01, 10.16, 12.05
and 12.06 hereof and if money shall have been deposited with the Trustee
pursuant to subclause (B) of clause (a) (l) of this Section 4.01, the
obligations of the Trustee under Section 4.02 hereof shall survive until the
Notes are no longer outstanding pursuant to the last paragraph of Section 3.09
hereof. After the Notes are no longer outstanding, the Company's obligations
under Sections 6.07, 12.05 and 12.06 hereof shall survive.
SECTION 4.02 Application of Trust Money. All money deposited with the
Trustee pursuant to Section 4.01 shall be held in trust and applied by it, in
accordance with the provisions of the Securities and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Persons
entitled thereto, of the principal amount of, premium, if any, and interest
payable on the Notes for whose payment such money has been deposited with the
Trustee.
SECTION 4.03 Moneys Held by Paying Agent
In connection with the satisfaction and discharge of this Indenture,
all moneys then held by any Paying Agent under the provisions of this Indenture
shall, upon written demand of the Company, be paid to the Trustee, or if
sufficient moneys have been deposited pursuant to Section 12.04 hereof, to the
Company upon a Company Request (or, if such moneys had been deposited by any
Guarantors, to such Guarantors), and thereupon such Paying Agent shall be
released from all further liability with respect to such moneys.
SECTION 4.04 Moneys Held by Trustee
Any moneys deposited with the Trustee or any Paying Agent or then held
by the Company or any Guarantor in trust for the payment of the principal of, or
premium, if any, or interest on any Note that are not applied but remain
unclaimed by the Holder of such Note for two years after the date upon which the
principal of, or premium, if any, or interest on such Note shall have
respectively become due and payable, shall be repaid to the Company (or, if
appropriate, any Guarantor) upon a Company Request, or if such moneys are then
held by the Company or any Guarantor in trust, such moneys shall be released
from such trust; and the Holder of such Note entitled to receive such payment
shall thereafter, as an unsecured general creditor, look only to the Company and
any Guarantors for the payment thereof, and all liability
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of the Trustee or such Paying Agent with respect to such trust money shall
thereupon cease; provided that the Trustee or any such Paying Agent, before
being required to make any such repayment, may, at the expense of the Company
and any Guarantors, either mail to each Holder affected, at the address shown in
the Security Register of the Notes maintained by the Security Registrar pursuant
to Section 7.02 hereof, or cause to be published once a week for two successive
weeks, in a newspaper published in the English language, customarily published
each Business Day and of general circulation in the City of New York, New York,
a notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such mailing or
publication, any unclaimed balance of such moneys then remaining will be repaid
to the Company. After payment to the Company or any Guarantor or the release of
any money held in trust by the Company or any Guarantor, as the case may be,
Holders entitled to the money must look only to the Company and any Guarantors
for payment as general creditors unless applicable abandoned property law
designates another Person.
ARTICLE V
REMEDIES
SECTION 5.01 Events of Default.
(a) "Event of Default", wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
be voluntary or involuntary or be effected by operation of law or pursuant to
any judgment, decree or order of any court or any order, rule or regulation of
any administrative or governmental body):
(1) default in the payment of any principal of, or premium, if
any, on the Notes when due (whether at maturity, upon redemption or
otherwise);
(2) default in the payment of any interest on any Note when due,
which default continues for 30 days or more;
(3) default by the Company or any Restricted Subsidiary in the
observance or performance of any other covenant in the Notes or this
Indenture for 60 days after written notice specifying the default and
demanding that such default be remedied from the Trustee or the Holders of
not less than 25% in aggregate principal amount of the Notes then
outstanding (except in the case of a default with respect to Section 10.10,
10.15 or 8.01 hereof, which shall constitute an Event of Default with such
notice requirement but without such passage of time requirement);
(4) failure to pay at final maturity (giving effect to any
applicable grace periods and any extensions thereof) the principal amount
of any Debt of the Company or any Restricted Subsidiary of the Company, or
the acceleration of the final stated maturity of such Debt if, in either
case, the aggregate principal amount of such Debt together with the
principal amount of any other Debt not paid at final maturity or which has
been accelerated, aggregates $25,000,000 or more at any time and such Debt
has not been discharged in full, or such acceleration has not been
rescinded or annulled within 30 days after such final maturity or
acceleration;
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(5) any final judgment or judgments which can no longer be
appealed for the payment of money in excess of $25,000,000(in excess of
amounts covered by insurance and as to which the insurer has acknowledged
coverage) shall be rendered against the Company or any Restricted
Subsidiary, and shall not be discharged for any period of 60 consecutive
days during which a stay of enforcement shall not be in effect;
(6) the Company or any Restricted Subsidiary with assets that
would be considered a "Significant Subsidiary "of the Company pursuant to
Rule 1.02(w)of Regulation S-X under the Securities Act of 1933, as amended,
pursuant to or within the meaning of any Bankruptcy Law:
(a) commences a voluntary case or commences proceedings to
make a proposal or a compromise or arrangement,
(b) consents to the entry of an order for relief against it
in an involuntary case,
(c) consents to the appointment of a custodian of it or for
all or substantially all of its property,
(d) makes a general assignment for the benefit of its
creditors, or
(e) generally is not paying its debts as they become due;
(7) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(a) is for relief against either of the Company or any
Restricted Subsidiary that would be considered a "Significant
Subsidiary" of the Company pursuant to Rule 1.02(w) of Regulation
S-X under the Securities Act of 1933, as amended in an in
voluntary case,
(b) appoints a custodian of either of the Company or any
Restricted Subsidiary that would be considered a "Significant
Subsidiary" of the Company pursuant to Rule 1.02(w) of Regulation
S-X under the Securities Act of 1933, as amended or for all or
substantially all of the property of either of the Company or any
such Restricted Subsidiary, or
(c) orders the liquidation of either of the Company or any
Restricted Subsidiary that would be considered a "Significant
Subsidiary" of the Company pursuant to Rule 1.02(w) of Regulation
S-X under the Securities Act of 1933, as amended,
and the order or decree remains unstayed and in effect for 60 days; or
(8) any of the Guarantees of a Material Subsidiary ceases to be
in full force and effect or any of the Guarantees of a Material Subsidiary
is declared to be null
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and void and unenforceable or any of the Guarantees of a Material
Subsidiary is found to be invalid or any of the Guarantors denies its
liability under its Guarantee (other than by reason of release; of a
Guarantor in accordance with Section 13.05 hereof).
SECTION 5.02 Acceleration of Maturity; Rescission and Annulment.
(a) If an Event of Default (other than an Event of Default specified
in Section 5.01(a)(6)or(7)) shall have occurred and be continuing, and if the
Trustee or the Holders of not less than 25% in aggregate principal amount of the
Notes then outstanding by written notice to the Company and the Trustee so
declares, the entire principal amount of all the Notes then outstanding plus
accrued and unpaid interest to the date of acceleration shall become immediately
due and payable; provided that in case an Event of Default described in
clause (6) or (7) of Section 5.01(a) hereof, the principal, premium and interest
amount with respect to all of the Notes shall be due and payable immediately
without any declaration or other act on the part of the Trustee or the Holders;
provided, further that after any such acceleration but before a judgment or
decree based on acceleration is obtained by the Trustee, the Holders of a
majority in aggregate principal amount of outstanding Notes may, under certain
circumstances, rescind and annul such acceleration if (i) all Events of Default,
other than non-payment of principal, premium, if any, or interest that has
become due solely because of the acceleration, have been cured or waived as
provided in this Indenture, (ii) to the extent the payment of such interest is
lawful, interest on overdue installments of interest and overdue principal,
which has become due otherwise than by such declaration of acceleration, has
been paid, (iii) the Company has paid the Trustee its reasonable compensation
and reimbursed the Trustee for its expenses, disbursements and advances
including the reasonable fees and expenses of counsel and (iv) in the event of
the cure or waiver of an Event of Default of the type described in clause (6) or
(7) of Section 5.01(a) hereof, the Trustee shall have received an Officers'
Certificate and an Opinion of Counsel that such Event of Default has been cured
or waived. No such rescission shall affect any subsequent Default or impair
any right consequent thereto.
(b) At any time after such a declaration of acceleration has been made
(or an Event of Default specified in Section 5.01(a)(6) or (7) shall have
occurred and be continuing) and before a judgment or decree for payment of the
money due has been obtained by the Trustee as hereinafter in this Article Five
provided, the Holders of a majority in aggregate principal amount of the
outstanding Notes, by written notice to the Company and the Trustee, may rescind
and annul such declaration (or such Event of Default) and its consequences if:
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay.
(A) all accrued and unpaid interest on all outstanding Notes,
(B) the principal amount and premium, if any, of the outstanding
Notes which have become due otherwise than by such
declaration of acceleration (including any Notes required to
have been purchased pursuant to an offer to purchase made by
the Company) and, to the extent that payment of such
interest is lawful, interest thereon at the rate provided by
the Notes,
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(C) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate provided by the
Notes, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel; and
(2) all Events of Default, other than the non-payment of the principal
of Securities which have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 5.13.
No such rescission shall affect any subsequent default or impair any
right Consequent thereon.
SECTION 5.03 Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of principal of, or premium, if any, and
interest on the Notes or to enforce the performance of any provision of the
Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of default. No remedy is exclusive of any
other remedy. All available remedies are cumulative to the extent permitted by
law. Any costs associated with actions taken by the Trustee under this Section
5.03 shall be reimbursed to the Trustee by the Company.
SECTION 5.04 Collection of Indebtedness and Suits for Enforcement by
Trustee.
(a) The Company covenants that if,
(1) default is made in the payment of any interest on any
Security when such interest becomes due and payable and such default
continues for a period of 30days, or
(2) default is made in the payment of the principal amount of (or
premium, if any, on) any Security at the Maturity Date thereof or, with
respect to any Security required to have been purchased pursuant to an
offer to purchase made by the Company, at the Purchase Date thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal amount at maturity (and premium, if any) and interest,
and, to the extent that payment of such interest shall be legally enforceable,
interest on any overdue on any overdue interest, at the rate provided by the
Securities, and, in addition thereto, such further amount as shall be sufficient
to cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
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(b) If the Company fails to pay such amounts forth with upon such
demand, the Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, may prosecute such proceeding to judgment or final decree and may
enforce the same against the Company or any Guarantor and collect the moneys
adjudged or decreed to be payable in the manner provided by law out of the
property of the Company or any Guarantor, wherever situated.
(c) If an Event of Default occurs and is continuing, the Trustee may
in its discretion proceed to protect and enforce its rights and the rights of
the Holders by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 5.05 Trustee May File Proofs of Claim.
(a) In case of any judicial proceeding relative to the Company or any
Guarantor, its property or its creditors, the Trustee shall be entitled and
empowered, by intervention in such proceeding or otherwise, to take any and all
actions authorized under the Trust Indenture Act in order to have claims of the
Holders and the Trustee allowed in any such proceeding. In particular, the
Trustee shall be authorized to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same; and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay to
the Trustee any amount due it For the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 6.07.
(b) No provision of this Indenture shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.
SECTION 5.06 Trustee May Enforce Claims Without Possession of
Securities. All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.
SECTION 5.07 Application of Money Collected. Subject to Article
Twelve, any money collected by the Trustee pursuant to this Article Five, shall
be applied in the following order, at the date or dates (including record dates)
fixed by the Trustee and, in case of
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the distribution of such money on account of the principal amount of, premium,
if any, and interest, upon presentation of the Securities and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid:
FIRST: To the payment of all amounts due the Trustee under Section
6.07; and
SECOND: to Holders for amounts due and unpaid on the Notes for
principal, premium, if any, and interest (including
Additional Interest, if any) as to each, ratably, without
preference or priority of any kind, according to the amounts
due and payable on the Notes; and
THIRD: to the Company or, to the extent the Trustee collects any
amount from any Guarantor, to such Guarantor.
SECTION 5.08 Limitation on Suits. Subject to Section 5.17 of this
Indenture, no Holder of any Security shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless:
(a) such Holder has previously given written notice to the Trustee of
a continuing Event of Default;
(b) the Holders of not less than 25% in aggregate principal amount of
the Notes then outstanding shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(c) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred
in compliance with such request;
(d) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(e) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
aggregate principal amount of the Notes then outstanding;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
SECTION 5.09 Restoration of Rights and Remedies. If the Trustee or
any Holder has instituted any proceeding to enforce any right or remedy under
this Indenture and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company, the Trustee and the Holders shall be restored
79
severally and respectively to their former positions hereunder and thereafter
all rights and remedies of the Trustee and the Holders shall continue as though
no such proceeding had been instituted.
SECTION 5.10 Rights and Remedies Cumulative. Except as otherwise
provided with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Securities in Section 3.08, no right or remedy herein conferred
upon or reserved to the Trustee or to the Holders is intended to be exclusive of
any other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in equity or otherwise.
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
SECTION 5.11 Delay or Omission Not Waiver. No delay or omission of
the Trustee or of any Holder of any Security to exercise any right or remedy
accruing upon any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article or by law to the Trustee or to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may be.
SECTION 5.12 Control by Holders. The Holders of a majority aggregate
principal amount of the Notes outstanding shall have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or exercising any trust or power conferred on the Trustee by this
Indenture. The Trustee, however, may refuse to follow any direction that
conflicts with law or this Indenture or that the Trustee determines may be
unduly prejudicial to the rights of another Holder not taking part in such
direction, and the Trustee shall have the right to decline to follow any such
direction if the Trustee, being advised by counsel, determines that the action
so directed may not lawfully be taken or if the Trustee in good faith shall, by
a Responsible Officer, determine that the proceedings so directed may involve it
in personal liability; provided that the Trustee may take any other action
deemed proper by the Trustee which is not inconsistent with such direction.
SECTION 5.13 Waiver of Past Defaults and Events of Default. Subject
to Sections 5.02, 5.08 and 9.02 hereof, the Holders of a majority in aggregate
principal amount of the Notes then outstanding by written notice to the Trustee
have the right to waive any existing Default or Event of Default or compliance
with any provision of this Indenture or the Notes. The Company shall deliver to
the Trustee an Officers' Certificate stating that the requisite percentage of
Holders has consented to such waiver. Upon any such waiver, such Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured for every purpose of this Indenture; provided that no such
waiver shall extend to any subsequent or other Default or Event of Default or
impair any right consequent thereto.
SECTION 5.14 Undertaking for Costs. In any suit for the enforcement
of any right or remedy under this Indenture, or in any suit against the Trustee
for any action taken, suffered or omitted by it as Trustee, a court may require
any party litigant in such suit to file an undertaking to pay the costs of such
suit, and may assess costs against any such party litigant, in the manner and to
the extent provided in the Trust Indenture Act; provided, that neither this
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Section nor the Trust Indenture Act shall be deemed to authorize any court to
require such an undertaking or to make such an assessment in any suit instituted
by the Company or the Trustee. This Section 5.14 does not apply to a suit by the
Trustee, a suit by a Holder pursuant to Section 5.16 hereof or a suit by Holders
of more than 10% in aggregate principal amount of the Notes then outstanding.
SECTION 5.15 Waiver of Stay, Extension or Usury Laws. Each of the
Company and the Guarantors covenants (to the extent that they may lawfully do
so)that they will not at any time insist upon, or plead (as a defense or
otherwise),or in any manner whatsoever claim or take the benefit or advantage
of, any stay or extension law or any usury law or other law, wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture or which would prohibit or forgive the Company
and any Guarantors from paying all or any portion of the principal of, premium,
if any, and/or interest on the Notes as contemplated herein; and the Company and
any Guarantors (to the extent that they may lawfully do so) hereby expressly
waive all benefit or advantage or any such law and covenants that they will not
hinder, delay or impede the execution of any power herein granted to the
Trustee, but they will suffer and permit the execution of every such power as
though no such law had been enacted.
SECTION 5.16 Rights of Holders To Receive Payment. Notwithstanding
any other provision of this Indenture, the right of any Holder of a Note to
receive payment of principal of, or premium, (if any), and interest on such Note
(including Additional Interest) on or after the respective due dates expressed
on such Note, or to bring suit for the enforcement of any such payment on or
after such respective dates, is absolute and unconditional and shall not be
impaired or affected without the consent of such Holder.
SECTION 5.17 Collection Suit by Trustee. If an Event of Default in
payment of principal, premium or interest specified in clause (1) or (2) of
Section 5.01(a) hereof occurs and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express trust against the Company
or any Guarantor for the whole amount of unpaid principal and accrued interest
remaining unpaid, together with interest on overdue principal and, to the extent
that payment of such interest is lawful, interest on overdue installments of
interest, in each case at the rate set forth in the Notes, and such further
amounts as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
ARTICLE VI
THE TRUSTEE
SECTION 6.01 Duties of Trustee.
(a) If an Event of Default actually known to a Responsible Officer of
the Trustee has occurred and is continuing, the Trustee shall exercise such of
the rights and powers vested in it by this Indenture and use the same degree of
care and skill in their exercise as a prudent person would exercise or use under
the same circumstances in the conduct of such person's own affairs.
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(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties that are
specifically set forth in this Indenture and no implied covenants or
obligations shall be read into this Indenture.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture but, in
the case of any such certificates or opinions which by any provision hereof
are specifically required to be furnished to the Trustee, the Trustee shall
be under a duty to examine the same to determine whether or not they
conform on their face to the requirements of this Indenture (but need not
confirm or investigate the accuracy of mathematical calculations, the
accuracy of the signatures or other facts stated therein).
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b) of
this Section 6.01.
(2) The Trustee shall not be liable for any error of judgment
made in good faith, unless it is proved that the Trustee was negligent in
ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to the terms of Sections 5.12 and 5.13 hereof.
(4) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its rights, powers or duties if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity satisfactory to it against such risk or liability is not
reasonably assured to it.
(d) Whether or not there in expressly so provided, paragraphs (a), (b)
and (c) of this Section 6.01 shall govern every provision of this Indenture that
in any way relates to the Trustee; provided that the Trustee's conduct does not
constitute negligence or bad faith.
(e) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company or any
Guarantor. Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by the law.
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SECTION 6.02 Rights of Trustee.
Subject to Section 6.01 hereof:
(a) The Trustee may rely on any document reasonably believed by it to
be genuine and to have been signed or presented by the proper person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request and any resolution of the Board of
Directors shall be sufficiently evidenced by a Board Resolution.
(c) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel, or both, which shall conform in
all material respects to the provisions of Section l.02(b) hereof. The Trustee
shall be protected and shall not be liable for any action it takes or omits to
take in good faith in reliance on such certificate or opinion.
(d) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent appointed by it
with due care.
(e) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it reasonably believes to be authorized or within
its rights or powers.
(f) The Trustee may consult with counsel of its selection, which may
include counsel to the Company or the Guarantors, and the advice or opinion of
such counsel as to matters of law shall be full and complete authorization and
protection from liability in respect of any action taken, omitted or suffered by
it hereunder in good faith and in accordance with the advice or opinion of such
counsel.
(g) Whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate.
(h) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, coupon or other paper or document.
(i) The Trustee shall not be deemed to have notice of any Event of
Default unless a Responsible Officer of the Trustee has actual knowledge thereof
or unless the Trustee shall have received written notice thereof at the
Corporate Trust Office of the Trustee, and such notice references the Notes and
this Indenture. As used herein, the term "actual knowledge" means the actual
fact or statement of knowing, without any duty to make any investigation with
regard thereto.
(j) The Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder.
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(k) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders, pursuant to the provisions of this
Indenture, unless such Holders shall have offered to the Trustee reasonable
security or indemnity against any loss, liability or expense which may be
incurred therein or thereby.
(l) The Trustee shall not be responsible for any information contained
in any notice provision provided to the Trustee by the Company for distribution
to the Holders.
(m) It being understood that the relevant rights, powers, benefits,
immunities and indemnities of or in favor of the Trustee under this Indenture
shall apply and be available to the Trustee in respect of the various capacities
in which it acts under this Indenture.
SECTION 6.03 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may make loans to, accept deposits from, perform
services for or otherwise deal with the either of the Company or any
Guarantor, or any Affiliates thereof, with the same rights it would have if it
were not Trustee. Any Agent may do the same with like rights. The Trustee,
however, shall be subject to Sections 6.10 and 6.11 hereof.
SECTION 6.04 Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes or any Guarantee,
it shall not be accountable for the Company's or any Guarantor's use of the
proceeds from the sale of Notes or any money paid to the Company or any
Guarantor pursuant to the terms of this Indenture and it shall not be
responsible for any statement in the Notes, any Guarantee or this Indenture
other than the Trustee's certificate of authentication.
SECTION 6.05 Notice of Defaults.
If a Default occurs and is continuing and if the Trustee has actual
knowledge of such default, the Trustee shall mail to each Holder notice of the
Default within 90 days after it occurs. Except in the case of a Default in
payment of the principal of, or premium, if any, or interest on any Note or a
default in the observance or performance of any of the obligations of the
Company under Article Five, the Trustee may withhold the notice if and so long
as a committee of its Responsible Officers in good faith determines that
withholding the notice is in the best interest of the Holders.
SECTION 6.06 Reports by Trustee to Holders.
(a) If required by Trust Indenture Act Section 313(a),within 90 days
after December 31 of any year, commencing December 31, 2003, the Trustee shall
mail to each Holder a brief report dated as of such December 31 that complies
with Trust Indenture Act Section 313(a). The Trustee also shall comply with
Trust Indenture Act Section 313(b)(2). The Trustee shall also transmit by mail
all reports as required by Trust Indenture Act Section 313(c) and Trust
Indenture Act Section 313(d).
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(b) Reports pursuant to this Section 6.06 shall be transmitted by
mail:
(i) to all Holders of Notes, as the names and addresses of such
Holders appear on the Security Registrar's books; and
(ii) to such Holders of Notes as have, within the two years
preceding such transmission, filed their names and addresses with the
Trustee for that purpose.
(c) A copy of each report at the time of its mailing to Holders shall
be filed with the Commission and each stock exchange on which the Notes are
listed. The Company shall promptly notify the Trustee when the Notes are listed
on any stock exchange.
SECTION 6.07 Compensation and Indemnity.
(a) The Company and any Guarantors shall pay to the Trustee and each
Agent from time to time reasonable compensation for its services hereunder
(which compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust). The Company and any
Guarantors shall reimburse the Trustee and each Agent upon request for all
reasonable disbursements, expenses and advances incurred or made by it in
connection with its duties under this Indenture, including the reasonable
compensation, disbursements and expenses of the Trustee's agents and counsel.
(b) The Company and any Guarantors shall indemnify each of the Trustee
and any predecessor Trustee and each Agent for, and hold each of them harmless
against, any and all loss, damage, claim, liability or expense, including
without limitation taxes (other than taxes based on the income of the Trustee or
such Agent) and reasonable attorneys' fees and expenses incurred by each of them
in connection with the acceptance or performance of its duties under this
Indenture including the reasonable costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance of
any of its powers or duties hereunder (including, without limitation, settlement
costs). The Company and any Guarantor need not pay for any settlement made
without its consent, which consent shall not be unreasonably withheld. The
Trustee or Agent, as the case may be, shall notify the Company and any
Guarantors in writing promptly of any claim asserted against the Trustee or such
Agent for which it may seek indemnity. However, the failure by the Trustee or
such Agent to so notify the Company and any Guarantors shall not relieve the
Company and any Guarantors of their obligations hereunder.
Notwithstanding the foregoing, the Company and any Guarantors need
not reimburse the Trustee or any Agent for any expense or indemnify it against
any loss or liability incurred by the Trustee or such Agent, as the case may be,
resulting from its own negligence, willful misconduct or bad faith. To secure
the payment obligations of the Company and any Guarantors in this Section 6.07,
the Trustee shall have a lien prior to the Notes on all money or property held
or collected by the Trustee except such money or property held in trust to pay
principal of and interest on particular Notes. The obligations of the Company
and any Guarantors under this Section 6.07 to compensate and indemnify the
Trustee and each predecessor Trustee and to pay or reimburse the Trustee and
each predecessor Trustee for
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expenses, disbursements and advances shall be joint and several liabilities of
the Company and any Guarantors and shall survive the resignation or removal of
the Trustee and the satisfaction, discharge or other termination of this
Indenture, including any termination or rejection hereof under any Bankruptcy
Law.
When the Trustee incurs expenses (including reasonable fees and
expenses of its Agents and counsel) or renders services after an Event of
Default specified in clause (6) or (7) of Section 5.01(a) hereof occurs, the
expenses and the compensation for the services are intended to constitute
expenses of administration under any Bankruptcy Law.
SECTION 6.08 Replacement of Trustee.
(a) The Trustee may resign by so notifying the Company and any
Guarantors in writing. The Holders of a majority in aggregate principal amount
of the outstanding Notes may remove the Trustee by notifying the Company and the
removed Trustee in writing and may appoint a successor Trustee with the
Company's written consent, which consent shall not be unreasonably withheld. The
Company may remove the Trustee at its election if:
(i) the Trustee fails to comply with Section 6.10 hereof;
(ii) the Trustee is adjudged a bankrupt or an insolvent;
(iii) a receiver or other public officer takes charge of the
Trustee or its property; or
(iv) the Trustee otherwise becomes incapable of performing its
duties hereunder.
(b) If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall notify the Holders of such
event and shall promptly appoint a successor Trustee. Within one year after such
successor Trustee takes office, the Holders of a majority in aggregate principal
amount of the Notes then outstanding may appoint a successor Trustee to replace
such successor Trustee appointed by the Company.
(c) If a successor Trustee does not take office within 60 days after
the retiring Trustee resigns or is removed, the retiring Trustee, the Company or
the Holders of a majority in principal amount of the outstanding Notes may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
(d) If the Trustee fails to comply with Section 6.10 hereof, any
Holder may petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee.
(e) A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately following
such delivery, the retiring Trustee shall, subject to its rights under Section
6.07 hereof, transfer all property held by it as Trustee to the successor
Trustee, the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have all the rights, powers and
duties of the Trustee
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under this Indenture. A successor Trustee shall mail notice of its succession to
each Holder. Notwithstanding replacement of the Trustee pursuant to this
Section 6.08, the Company's and any Guarantor's obligations under Section 6.07
hereof shall continue for the benefit of the retiring Trustee. No successor
Trustee shall accept its appointment unless at the time of such acceptance such
successor Trustee shall be qualified and eligible under this Article.
SECTION 6.09 Successor Trustee by Consolidation, Merger, Etc.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust assets to, another
corporation, subject to Section 6.10 hereof, the successor corporation without
any further act shall be the successor Trustee; provided such entity shall be
otherwise qualified and eligible under this Article Six. In case any Securities
shall have been authenticated, but not delivered, by the Trustee then in office,
any successor by merger, conversion or consolidation to such authenticating
Trustee may adopt such authentication and deliver the Securities so
authenticated with the same effect as if such successor Trustee had itself
authenticated such Securities.
SECTION 6.10 Corporate Trustee Required; Eligibility.
This Indenture shall always have a Trustee who satisfies the
requirements of Trust Indenture Act Section 310(a)(1) and (2) in every respect.
The Trustee (together with its corporate parent) shall have a combined capital
and surplus of at least US$100,000,000 as set forth in the most recent
applicable published annual report of condition. The Trustee shall comply with
Trust Indenture Act Section 310(b), including the provision in Trust Indenture
Act Section 310(b)(l). If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article.
SECTION 6.11 Preferential Collection of Claims Against Company.
The Trustee shall comply with Trust Indenture Act Section 311(a),
excluding any creditor relationship listed in Trust Indenture Act Section
31l(b). A Trustee who has resigned or been removed shall be subject to Trust
Indenture Act Section 31l(a) to the extent indicated therein.
SECTION 6.12 Paving Agents.
The Company shall cause each Paying Agent other than the Trustee to
execute and deliver to it and the Trustee an instrument in which such agent
shall agree with the Trustee, subject to the provisions of this Section 6.12:
(i) that it will hold all sums held by it as agent for the payment of
principal of, or premium, if any, or interest on, the Notes (whether such
sums have been paid to it by the Company, any Guarantor or by any other
obligor on the Notes) in trust for the benefit of Holders of the Notes or
the Trustee;
(ii) that it will at any time during the continuance of any Event of
Default, upon written request from the Trustee, deliver to the Trustee all
sums so held in trust by it together with a full accounting thereof; and
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(iii) that it will give the Trustee written notice within three
Business Days of any failure of the Company, any Guarantor or by any
obligor on the Notes in the payment of any installment of the principal of,
premium, if any, or interest on, the Notes when the same shall be due and
payable.
SECTION 6.13 Disqualification: Conflicting Interests. If the Trustee
has or shall acquire a conflicting interest within the meaning of the Trust
Indenture Act, the Trustee shall either eliminate such interest or resign, to
the extent and in the manner provided by, and subject to the provisions of, the
Trust Indenture Act and this Indenture.
SECTION 6.14 Appointment of Authenticating Agent. (a) The Trustee may
appoint an Authenticating Agent or Agents which shall be authorized to act on
behalf of the Trustee to authenticate Securities issued upon original issue and
upon exchange, registration of transfer, partial conversion or partial
redemption or pursuant to Section 3.08, and Securities so authenticated shall
be entitled to the benefits of this Indenture and shall be valid and obligatory
for all purposes as if authenticated by the Trustee hereunder. Wherever
reference is made in this Indenture to the authentication and delivery of
Securities by the Trustee or the Trustee's certificate of authentication, such
reference shall be deemed to include authentication and delivery on behalf of
the Trustee by an Authenticating Agent and a certificate of authentication
executed on behalf of the Trustee by an Authenticating Agent. Each
Authenticating Agent shall be acceptable to the Company and shall at all times
be a corporation organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia, authorized
under such laws to act as Authenticating Agent, having a combined capital and
surplus of not less than $100,000,000 and subject to supervision or examination
by Federal or State authority. If such Authenticating Agent publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Authenticating Agent shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent shall cease to be
eligible in accordance with the provisions to this Section, such Authenticating
Agent shall resign immediately in the manner and with the effect specified in
this Section.
(b) Any corporation in to which an Authenticating Agent may be merged
or converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall otherwise be eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
(c) An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appointment by first-class
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mail, postage prepaid, to all Holders as their names and addresses appear in the
Security Register. Any successor Authenticating Agent upon acceptance of its
appointment hereunder shall become vested with all the rights, powers and duties
of its predecessor hereunder, with like effect as if originally named as an
Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provisions of this Section.
(d) The Trustee agrees to pay to each Authenticating Agent from time
to time reasonable compensation for its services under this Section, and the
Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 6.07.
(e) If an appointment is made pursuant to this Section, the Securities
may have endorsed thereon, in addition to the Trustee's certificate of
authentication, an alternative certificate of authentication in the following
form:
"This is one of the Securities described in the within-mentioned
Indenture.
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Trustee
By:
------------------------------------
As Authenticating Agent
By:
------------------------------------
Authorized Signatory"
ARTICLE VII
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 7.01 Company to Furnish Trustee Names and Addresses of
Holders. If the Trustee is not the Security Registrar the Company will furnish
or cause to be furnished to the Trustee:
(a) at least five Business Days before each Interest Payment Date; and
(b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request,
a list in such form and as of such date as the Trustee may reasonably require of
the names and addresses of the Holders.
SECTION 7.02 Preservation of Information; Communications to Holders.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 7.01 and the names and
addresses of Holders received by the
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Trustee in its capacity as Security Registrar. As the Security Registrar, the
Trustee will maintain the list in the form of the Security Register. The Trustee
may destroy any list furnished to it as provided in Section 7.01 upon receipt of
a new list so furnished.
(b) The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities and the
corresponding rights and duties of the Trustee, shall be provided by the Trust
Indenture Act.
(c) Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any agent of either of them shall be held accountable by reason of any
disclosure of information as to the names and addresses of Holders made pursuant
to Section 312 of the Trust Indenture Act.
SECTION 7.03 Reports by Trustee.
(a) The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.
(b) A copy of each such report shall, at the time of such transmission
to Holders, be filed by the Trustee with each stock exchange upon which the
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when the Securities are listed on any stock exchange.
ARTICLE VIII
AMALGAMATIONS, MERGERS, CONSOLIDATIONS
AND CERTAIN SALES AND PURCHASES OF ASSETS
SECTION 8.01 The Company May Consolidate, Etc. Only on Certain Terms.
(a) The Company shall not, and shall not cause or permit any of its
Restricted Subsidiaries to, consolidate with, amalgamate with, merge with or
into, or sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of the assets of the Company (determined on a consolidated
basis for the Company and its Restricted Subsidiaries)in one transaction or a
series of related transactions to, any Person unless:
(1) (A) the Company or such Restricted Subsidiary, as the case
may be, shall be the continuing Person,(B)in the case of a Restricted
Subsidiary, the Person is also a Restricted Subsidiary, and one of the
Restricted Subsidiaries is the continuing Person, or (C)the Person (if
other than the Company or such Restricted Subsidiary) formed by such
consolidation or amalgamation or into which the Company or such Restricted
Subsidiary, as the case may be, is merged or assigned, transferred, leased,
conveyed or otherwise disposed of shall be organized and existing under the
laws of the United States or any State thereof or the District of Columbia
or the laws of Canada or any province or territory thereof and shall
expressly assume, by a supplemental indenture, executed and delivered to
the Trustee, in form satisfactory to the Trustee, all of the obligations of
the Company or such Restricted Subsidiary, as the case may be, under this
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Indenture, the Notes and any Guarantee, as the case may be, and the
obligations thereunder shall remain in full force and effect;
(2) immediately before and immediately after giving effect to
such transaction (including, without limitation, giving effect to any Debt
and Acquired Debt incurred or anticipated to be incurred and any Lien
granted in connection with or in respect of the transaction), no Default or
Event of Default shall have occurred and be continuing; and
(3) immediately after giving effect to such transaction on a pro
forma basis the Company or such Person (A) could incur at least US$1.00 of
additional Debt (other than Permitted Debt) pursuant to Section 10.06
hereof or (B) shall have a Consolidated Fixed Charge Coverage Ratio that is
greater than the Consolidated Fixed Charge Coverage Ratio of the Company
immediately prior to the transaction; provided that the Company or a
Guarantor may merge into or amalgamate with or sell all or substantially
all of its assets to the Company or another Guarantor, as the case may be,
without complying with this clause (3).
(b) In connection with any consolidation, merger or transfer of assets
contemplated by this Section 8.01, prior to the consummation of such transaction
the Company shall deliver, or cause to be delivered, to the Trustee, in form and
substance reasonably satisfactory to the Trustee, an Officers' Certificate and
an Opinion of Counsel, each stating that such consolidation, amalgamation,
merger or transfer and the supplemental indenture in respect thereto comply with
this provision and that all conditions precedent herein provided for relating to
such transaction or transactions have been complied with.
For purposes of clauses (a) and (b) of this Section 8.01, the transfer
(by lease, assignment, sale or otherwise, in a single transaction or series of
transactions) of all or substantially all of the properties or assets of one or
more Restricted Subsidiaries of the Company, the Capital Stock of which
constitutes all or substantially all of the properties and assets of the
Company, shall be deemed to be the transfer of all or substantially all of the
properties and assets of the Company.
SECTION 8.02 Successor Person Substituted. Upon any consolidation,
amalgamation or merger, or any transfer of all or substantially all of the
assets of the Company or any Restricted Subsidiary in accordance with Section
8.01 hereof, the successor Person formed by such consolidation or amalgamation
or into which the Company or a Restricted Subsidiary is merged or to which such
transfer is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company or such Restricted Subsidiary under this
Indenture and the Notes with the same effect as if such successor Person had
been named as the Company or such Restricted Subsidiary herein and in the Notes,
and thereafter the predecessor Person shall be relieved of all obligations and
covenants under this Indenture and the Notes. The foregoing restrictions shall
not apply to any transaction involving a merger of the Company with an Affiliate
solely for the purpose of reincorporating the Company in another jurisdiction.
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ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01 Without Consent of Holders. The Company and any
Guarantors, when authorized by a Board Resolution of each of them, and the
Trustee, when an Officers' Certificate is provided stating that such amendment
or supplement complies with the provisions of this Section 9.01, may amend,
waive or supplement this Indenture or the Notes without notice to or consent of
any Holder:
(i) to comply with Section 8.01 hereof;
(ii) to provide for uncertificated Notes in addition to or
in place of certificated Notes;
(iii) to comply with any requirements of the Commission
under the Trust Indenture Act;
(iv) to cure any ambiguity, defect or inconsistency;
(v) to add a Guarantor;
(vi) to provide for the issuance of the Exchange Securities
or the Private Exchange Securities in accordance with Section
2.01 hereof in a manner that does not adversely affect the rights
of any Holder;
(vii) to provide for the assumption of the Company's or a
Guarantor's obligations to Holders in the event of a merger,
amalgamation or consolidation in accordance with the terms of
this Indenture;
(viii) in reliance on an Opinion of Counsel, to make any
other change that does not adversely affect the rights of any
Holders hereunder in any material respect;
(ix) to comply with the requirements of the Commission to
effect or maintain the qualification of this Indenture under the
Trust Indenture Act; or
(x) to appoint a successor trustee, in the event that the
Trustee is disqualified from acting or ineligible to act as such
because of a conflict of interest, provided, that, the successor
trustee be otherwise qualified and eligible to act as such under
Article Six of this Indenture.
The Trustee is hereby authorized to join with the Company and any
Guarantors in the execution of any supplemental indenture authorized or
permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations which may be therein contained, but the Trustee
shall not be obligated to enter into any such supplemental indenture which
adversely affects its own rights, duties or immunities under this Indenture.
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SECTION 9.02 With Consent of Holders. The Company (when authorized by
a Board Resolution) and any Guarantors (when authorized by a Board Resolution)
may, subject to Section 9.06 hereof, direct the Trustee to modify or supplement
this Indenture, the Guarantees and/or the Notes with the written consent of the
Holders of at least a majority in aggregate principal amount of the outstanding
Notes. The Holders of not less than a majority in aggregate principal amount of
the outstanding Notes may waive compliance in a particular instance by the
Company or any Guarantor with any provision of this Indenture or the Notes.
Subject to Section 9.04 hereof, without the consent of each Holder affected,
however, an amendment, supplement or waiver, including a waiver pursuant to
Section 5.13 hereof, may not:
(i) reduce the amount of Notes whose Holders must consent to
an amendment, supplement or waiver to this Indenture;
(ii) reduce the rate of, change the method of calculation of
or change the time for payment of interest, including defaulted
interest, on any Note;
(iii) reduce the principal of or premium on or change the
stated maturity of any Note or change the date on which any Notes
may be subject to redemption or repurchase or reduce the
redemption or repurchase price therefor;
(iv) make any Note payable in money other than that stated
in the Note or change the place of payment from New York, New
York;
(v) waive a default on the payment of the principal of,
interest on, or redemption payment with respect to any Note
(except a rescission of acceleration of the Notes in accordance
with the terms of this Indenture or a waiver of the payment
default that resulted from such acceleration in accordance with
the terms of this Indenture);
(vi) make any change in provisions of this Indenture
protecting the right of each Holder to receive payment of
principal of and interest on such Note on or after the due date
thereof or to bring suit to enforce such payment, or permitting
Holders of a majority in aggregate principal amount of Notes to
waive Defaults or Events of Default;
(vii) amend, change or modify in any material respect the
obligation of the Company to make and consummate a Change of
Control Offer in the event of a Change of Control Triggering
Event or make and consummate an Excess Proceeds Offer with
respect to any Asset Sale that has been consummated or modify any
of the provisions or definitions with respect thereto;
(viii) modify or change any provision of this Indenture or
the related definitions affecting the ranking of the Notes or any
Guarantee in a manner which adversely affects the Holders; or
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(ix) release any Guarantor from any of its obligations under
its Guarantee or this Indenture otherwise than in accordance with
the terms of this Indenture.
After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to the Holders a notice briefly
describing the amendment, supplement or waiver.
Upon the written request of the Company, accompanied by a Board
Resolution authorizing the execution of any such supplemental indenture, and
upon the receipt by the Trustee of evidence reasonably satisfactory to the
Trustee of the consent of the Holders as aforesaid and upon receipt by the
Trustee of the documents described in Section 9.06 hereof, the Trustee shall
join with the Company and any Guarantors in the execution of such supplemental
indenture unless such supplemental indenture affects the Trustee's own rights,
duties or immunities under this Indenture, in which case the Trustee may, but
shall not be obligated to, enter into such supplemental indenture.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
SECTION 9.03 Compliance with Trust indenture Act. Every amendment or
supplement to this Indenture or the Notes shall comply with the Trust Indenture
Act as then in effect.
SECTION 9.04 Revocation and Effect of Consents. Until an amendment,
supplement, waiver or other action becomes effective, a consent to it by a
Holder is a continuing consent conclusive and binding upon such Holder and every
subsequent Holder of the same Note or portion thereof, and of any Note issued
upon the transfer thereof or in exchange therefor or in place thereof, even if
notation of the consent is not made on any such Note. Any such Holder or
subsequent Holder, however, may revoke the consent as to his Note or portion of
a Note, if the Trustee receives the written notice of revocation before the
date the amendment, supplement, waiver or other action becomes effective.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement, or waiver. If a record date is fixed, then, notwithstanding the
preceding paragraph, those Persons who were Holders at such record date (or
their duly designated proxies), and only such Persons, shall be entitled to
consent to such amendment, supplement, or waiver or to revoke any consent
previously given, whether or not such Persons continue to be Holders after such
record date. No such consent shall be valid or effective for more than 120 days
after such record date unless the consent of the requisite number of Holders has
been obtained.
An amendment, supplement, waiver or other action becomes effective in
accordance with its terms and thereafter shall bind every Holder, unless it
makes a change described in any of clauses (i) through (ix) of Section 9.02
hereof. In that case the amendment, supplement, waiver or other action shall
bind each Holder who has consented to it and every
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subsequent Holder or portion of a Note that evidences the same debt as the
consenting Holder's Note.
SECTION 9.05 Notation on or Exchange of Notes. If an amendment,
supplement, or waiver changes the terms of a Note, the Trustee (in accordance
with the specific written direction of the Company) shall request the Holder of
the Note (in accordance with the specific written direction of the Company) to
deliver it to the Trustee. In such case, the Trustee shall at the expense of the
Company place an appropriate notation on the Note about the changed terms and
return it to the Holder. Alternatively, if the Company or the Trustee so
determines, the Company in exchange for the Note shall issue, any Guarantors
shall endorse and the Trustee shall authenticate a new Note that reflects the
changed terms. Failure to make the appropriate notation or issue a new Note
shall not affect the validity and effect of such amendment, supplement or
waiver.
SECTION 9.06 Trustee To Sign Amendments, Etc. The Trustee shall sign
any amendment, supplement or waiver authorized pursuant to this Article Nine if
the amendment, supplement or waiver does not adversely affect the rights,
duties, liabilities or immunities of the Trustee. If it does, the Trustee may,
but need not, sign it. In signing or refusing to sign such amendment, supplement
or waiver the Trustee shall be entitled to receive and, subject to Sections 6.01
and 6.02 hereof, shall be fully protected in relying upon an Officers'
Certificate and an Opinion of Counsel stating, in addition to the matters
required by Section 1.02 hereof, that such amendment, supplement or waiver is
authorized or permitted by this Indenture and is a legal, valid and binding
obligation of the Company and any Guarantors, enforceable against the Company
and any Guarantors in accordance with its terms (subject to customary
exceptions).
SECTION 9.07 Effect of Supplemental Indentures. Upon the execution of
any supplemental indenture under this Article, this Indenture shall be modified
in accordance therewith, and such supplemental indenture shall form a part of
this Indenture for all purposes; and every Holder of Securities theretofore or
thereafter authenticated and delivered hereunder shall be bound thereby.
SECTION 9.08 Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article may, and shall if required by the Trustee,
bear a notation in form approved by the Trustee as to any matter provided for in
such supplemental indenture. If the Company shall so determine, new Securities
so modified as to conform, in the opinion of the Trustee and the Company, to any
such supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for outstanding Notes.
ARTICLE X
COVENANTS
SECTION 10.01 Payment of Notes. The Company shall pay the principal
of and interest (including all Additional Interest) on the Notes on the dates
and in the manner provided in the Notes and this Indenture. An installment of
principal or interest shall be considered paid on the date it is due if the
Trustee or Paying Agent (if other than the Company, a
95
Subsidiary of the Company or any Guarantor) holds on that date money designated
for and sufficient to pay such installment.
The Company shall pay interest on overdue principal (including
post-petition interest in a proceeding under any Bankruptcy Law), and overdue
installments of interest, to the extent lawful, at the rate specified in the
Notes.
SECTION 10.02 Reports to Holders. Whether or not required by the
rules and regulations of the Commission, so long as the Notes are outstanding,
the Company shall furnish to the Trustee and, upon request, to the Holders all
annual and quarterly financial information that would be required to be
contained in a filing with the Commission on Forms 20-F, 40-F and 6-K, as
applicable, if the Company 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 financial information, a report on
the audit of the financial statements by the Company's independent accountants;
provided, that (x) such quarterly financial information shall be furnished
within 60 days following the end of each quarter of the Company and (y) such
annual financial information shall be furnished within 180 days following the
end of the fiscal year of the Company. In addition, whether or not required by
the rules and regulations of the Commission, the Company will file with or
furnish to the Commission a copy of all such information and reports with the
Commission for public availability (unless the Commission will not accept such a
filing or furnishing). In addition, the Company shall furnish to the Holders and
to prospective investors, upon request, any information required to be delivered
pursuant to Rule 144A(d)(4) under the Securities Act so long as the Notes are
not freely transferable under the Securities Act. The Company, the Guarantors
and their respective subsidiaries will also comply with the other provisions of
Trust Indenture Act Section 314(a).
SECTION 10.03 [Intentionally Omitted.]
SECTION 10.04 Compliance Certificate.
(a) The Company shall deliver to the Trustee, within 120 days after
the end of each fiscal year and on or before 60 days after the end of the first,
second and third quarters of each fiscal year, an Officers' Certificate stating
that a review of the activities of the Company and its Subsidiaries during such
fiscal year or fiscal quarter, as the case may be, has been made under the
supervision of the signing Officers with a view to determining whether the
Company and each Guarantor has kept, observed, performed and fulfilled their
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge, the Company
and each Guarantor has kept, observed, performed and fulfilled each and every
covenant contained in this Indenture and is not in default in the performance or
observance of any of the terms, provisions and conditions hereof (or, if a
Default or Event of Default shall have occurred, describing all such Defaults or
Events of Default of which he or she may have knowledge and what action they are
taking or propose to take with respect thereto) and that to the best of his or
her knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action the Company and any Guarantors are taking or propose to take with respect
thereto.
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(b) The Company and any Guarantors shall, so long as any of the Notes
are outstanding, deliver to the Trustee, forthwith upon any Officer becoming
aware of any Default or Event of Default, an Officers' Certificate specifying
such Default or Event of Default and what action the Company and any Guarantors
are taking or propose to take with respect thereto.
(c) The Company's fiscal year currently ends on December 31. The
Company will promptly provide written notice to the Trustee of any change in its
fiscal year.
SECTION 10.05 Taxes. The Company and any Guarantors shall, and shall
cause each of their Subsidiaries to, pay prior to delinquency all material
taxes, assessments, and governmental levies except as contested in good faith
and by appropriate proceedings.
SECTION 10.06 Limitation on Additional Debt. (a) The Company shall
not, and shall not cause or permit any of its Restricted Subsidiaries to,
directly or indirectly, incur any Debt (including, without limitation, any
Acquired Debt), except Permitted Debt and except that, if no Default or Event of
Default shall have occurred and be continuing at the time or as a consequence of
the incurrence of such Debt, the Company or any Restricted Subsidiary may incur
Debt (including any Acquired Debt) if the Company's Consolidated Fixed Charge
Coverage Ratio is at least 2.0 to 1. Even if the Company's Consolidated Fixed
Charge Coverage Ratio is less than 2.0 to 1, the Company and its Restricted
Subsidiaries may incur Permitted Debt.
(b) For purposes of determining compliance with this Section 10.06, in
the event that an item of Debt meets the criteria of more than one of the
categories of Permitted Debt described in clauses (1) through (14) of the
definition thereof or is entitled to be incurred pursuant to the first paragraph
of this Section 10.06 (other than debt outstanding under the Credit Facilities
on the date on which the Notes are first issued under this Indenture, which
shall be treated as incurred pursuant to clause (1) of the definition of
Permitted Debt), the Company shall classify (and subsequently may reclassify one
or more times) such Debt in its sole discretion, and such item of Debt will,
upon such classification or reclassification, as the case may be, be treated as
having been incurred pursuant to only one of such clauses or pursuant to the
first paragraph of this Section 10.06. Accrual of interest, the accretion of
accreted value and the payment of interest in the form of additional Debt, in
each case in accordance with the terms of the underlying Debt at its time of
incurrence by the Company or a Restricted Subsidiary, as the case may be, will
not be deemed to be an incurrence of Debt for purposes of this Section 10.06;
provided that the underlying Debt is incurred in accordance with the terms of
this Indenture. Any increase in the Canadian dollar equivalent of outstanding
Debt of the Company or any of its Restricted Subsidiaries denominated
in a currency other than Canadian dollars resulting from fluctuations in the
exchange values of currencies shall not be deemed to be an incurrence of Debt
for purposes of this Section 10.06; provided that the amount of Debt of the
Company outstanding at any time shall be the Canadian dollar equivalent of all
such Debt of the Company outstanding at such time.
SECTION 10.07 Limitation on Restricted Payments. (a) The Company
shall not make, and shall not cause or permit any of its Restricted Subsidiaries
to, directly or indirectly, make, any Restricted Payment, unless:
97
(1) no Default or Event of Default shall have occurred and be
continuing at the time of or immediately after giving effect to such
Restricted Payment;
(2) immediately after giving pro forma effect to such Restricted
Payment, the Company could incur US$1.00 of additional Debt (other than
Permitted Debt) pursuant to Section 10.06 hereof; and
(3) immediately after giving effect to such Restricted Payment,
the aggregate amount of all Restricted Payments declared or made after
August 14, 2001 does not exceed the sum, (without duplication), of:
(A) the sum of (x) 50% of the Company's cumulative Consolidated
Net Income (or if cumulative Consolidated Net Income shall be a loss,
minus 100% of such loss) for the period beginning July 1, 2001 and
ending on the last day of the fiscal quarter immediately preceding the
date of such proposed Restricted Payment (treating such period as a
single accounting period), and (y) the Pacifica Income Adjustment
Amount; plus
(B) 100% of the aggregate net cash proceeds received by the
Company from Capital Contributions or from the issuance or sale after
August 14, 2001 (other than to a Restricted Subsidiary) of (x) Capital
Stock (other than Disqualified Capital Stock) of the Company or (y)
any Debt or other securities of the Company that are convertible into
or exercisable or exchangeable for Capital Stock (other than
Disqualified Capital Stock) of the Company which have been so
converted, exercised or exchanged, as the case may be; plus
(C) without duplication of any amounts included in subclause (A)
of this clause (3), so long as the Designation thereof was treated as
a Restricted Payment made after August 14, 2001, with respect to any
Unrestricted Subsidiary that has been redesignated as a Restricted
Subsidiary after August 14, 2001 in accordance with the definition of
"Restricted Subsidiary," the Company's proportionate interest in an
amount equal to the Fair Market Value of the Company's interest in
such Subsidiary; provided that such amount shall not in any case
exceed the Designation Amount with respect to such Restricted
Subsidiary at the time of its Designation; plus
(D) in the case of the disposition or repayment of any Investment
constituting a Restricted Payment made after August 14, 2001, to the
extent not otherwise included in the Company's Consolidated Net
Income, the amount of cash proceeds (or Cash Equivalents) received by
the Company or any Restricted Subsidiary with respect to such
Investment, net of any costs of disposition and taxes paid or payable
in connection with such disposition or repayment; plus
(E) to the extent not otherwise included in the Company's
Consolidated Net Income, the amount of the cash proceeds (or Cash
Equivalents) received by the Company or any Restricted Subsidiary upon
the sale of any
98
Unrestricted Subsidiary after August 14, 2001, net of any costs of
disposition and taxes paid or payable in connection with such sale;
plus
(F) $40,000,000.
For purposes of determining the amount expended for Restricted
Payments under this clause (3), property other than cash shall be
valued at its Fair Market Value.
(b) The provisions of this Section 10.07 shall not prevent,
(1) the payment of any dividend or distribution within 60 days
after the date of declaration thereof, if at such date of declaration such
payment would comply with the provisions of this Indenture;
(2) the repurchase, redemption or other acquisition or retirement
of any shares of Capital Stock of the Company or Debt of the Company or any
Guarantor subordinated to the Notes or such Guarantor's Guarantee, as the
case may be, by conversion into, or by or in exchange for, shares of
Capital Stock of the Company (other than Disqualified Capital Stock), or
out of the net cash proceeds of the substantially concurrent sale (other
than to a Restricted Subsidiary of the Company) of other shares of Capital
Stock of the Company (other than Disqualified Capital Stock); provided that
any such net cash proceeds are excluded from Section 10.07 (a)(3)(B) for
the purposes of this calculation (and were not included in Section 10.07
(a)(3)(B) at any time);
(3) the redemption, repayment or retirement of Debt of the
Company or any Guarantor subordinated to the Notes or such Guarantor's
Guarantee, as the case may be, in exchange for, by conversion into, or out
of the net cash proceeds of, (x) a substantially concurrent sale or
incurrence of Debt of the Company or such Guarantor, as the case may be
(other than any Debt owed to a Restricted Subsidiary), that is
contractually subordinated in right of payment to the Notes or such
Guarantor's Guarantee, as the case may be, to at least the same extent as
the Debt being redeemed, repaid or retired, or (y) a substantially
concurrent sale (other than to a Restricted Subsidiary of the Company) of
shares of Capital Stock of the Company; provided that any such net cash
proceeds are excluded from Section 10.07 (a)(3)(B) (and were not included
therein at any time);
(4) the retirement of any shares of Disqualified Capital Stock of
the Company by conversion into, or by exchange for, other shares of
Disqualified Capital Stock of the Company, or out of the net cash proceeds
of the substantially concurrent sale (other than to a Restricted Subsidiary
of the Company) of other shares of Disqualified Capital Stock of the
Company; provided that any such net cash proceeds are excluded from Section
10.07(a)(3)(B) (and were not included in Section 10.07(a)(3)(B) at any
time);
(5) the purchase, redemption or other acquisition for value of
shares of Capital Stock of the Company (other than Disqualified Capital
Stock) held by employees or directors of the Company (or their estates or
beneficiaries under their estates) upon the
99
death, retirement or termination of employment or directorship of such
employees or directors pursuant to or in accordance with the terms of an
employee benefit plan or other agreement approved by the Board of Directors
of the Company; provided that the aggregate cash consideration paid, or
distributions made, pursuant to this clause (5) do not exceed $5,000,000 in
the aggregate subsequent to August 14, 2001;
(6) the payment of any dividend in respect of shares of the
Company's Capital Stock, provided that (A) the aggregate amount of all such
dividends paid pursuant to this clause (6) in any twelve-month period shall
not exceed $25,000,000 and (B) immediately after giving pro forma effect to
such payment, the Company could incur US$1.00 of additional Debt, other
than Permitted Debt, under Section 10.06 hereof; and
(7) the repurchase of shares of the Company's Capital Stock
deemed to occur upon the exercise of stock options if such shares of
Capital Stock represent a portion of the exercise price of such stock
options.
In calculating the aggregate amount of Restricted Payments made
subsequent to August 14, 2001 for purposes of Section 10.07(a)(3), amounts
expended pursuant to clauses(b)(l) and (b)(5) of this Section 10.07 shall
be included in such calculation and amounts expended pursuant to
clauses (b)(2), (b)(3), (b)(4), (b)(6) and (b)(7) of this Section 10.07
shall not be included in such calculation; provided that amounts expended
pursuant to clause (b)(l) of this Section 10.07 will only be included if
the declaration thereof had not been counted in a prior period.
SECTION 10.08 Limitation on Liens. The Company shall not, and shall
not cause or permit any of its Restricted Subsidiaries, directly or indirectly,
to, create, incur or otherwise cause or suffer to exist or become effective any
Liens (other than Permitted Liens) upon or with respect to any property or
assets of the Company or any of its Restricted Subsidiaries, unless:
(i) if such Lien secures Debt which is ranked equally and ratably with
the Notes or any Guarantee, then the Notes or such Guarantee, as the case
may be, are secured on an equal and ratable basis with the obligations so
secured until such time as such obligations are no longer secured by such
Lien or the Lien is a Permitted Lien, or
(ii) if such Lien secures Debt which is subordinated to the Notes or
any Guarantee, then the Notes or such Guarantee, as the case may be, are
secured and the Lien securing such other Debt shall be subordinated to the
Lien granted to the Holders of the Notes or such Guarantee, as the case may
be, at least to the same extent as such Debt is subordinated to the Notes
or such Guarantee, as the case may be, until such time as such obligations
are no longer secured by a Lien.
The Company and Restricted Subsidiaries may create, incur or cause or
permit to exist Permitted Liens as described in the definition of
"Permitted Liens" of this Indenture.
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SECTION 10.09 Limitation on Transactions with Affiliates.
(a) The Company shall not, and shall not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly, enter into or suffer to
exist any transaction or series of related transactions (including, without
limitation, the sale, purchase, exchange or lease of assets, property or
services) with any Affiliate (each an "Affiliate Transaction") or extend, renew,
waive or otherwise modify the terms of any Affiliate Transaction entered into
prior to the Issue Date, unless:
(1) such Affiliate Transaction is between or among the Company
and its Restricted Subsidiaries or between or among Restricted
Subsidiaries; or
(2) the terms of such Affiliate Transaction are no less favorable
to the Company or such Restricted Subsidiary, as the case may be, than the
terms which could reasonably be obtained by the Company or such Restricted
Subsidiary, as the case may be, at such time in a comparable transaction
made on an arm's-length basis between unaffiliated parties.
In any Affiliate Transaction (or any series of related Affiliate
Transactions) involving an amount or having a Fair Market Value in excess of
$10,000,000 which is not permitted under clause(a)(1) of this Section 10.09, the
Company shall obtain a resolution of the disinterested members of the Board of
Directors of the Company certifying that they have approved such Affiliate
Transaction and determined that such Affiliate Transaction complies with
clause(a)(2)of this Section 10.09.
In addition, in any Affiliate Transaction (or any series of related
Affiliate Transactions) involving an amount or having a Fair Market Value in
excess of $75,000,000 which is not permitted under clause(a)(l) of this Section
10.09, the Company must obtain a written opinion from an Independent Financial
Advisor that such transaction or transactions are fair to the Company or such
Restricted Subsidiary, as the case may be, from a financial point of view.
(b) The provisions of Section 10.09(a) will not apply to,
(1) any Restricted Payment made in compliance with Section 10.07
hereof,
(2) any payment of customary and reasonable fees to directors of
the Company,
(3) any employment agreement or compensation arrangement in
effect on the Issue Date, or entered into thereafter by the Company or any
of its Restricted Subsidiaries in the ordinary course of business and
consistent with the past practice of the Company and its Restricted
Subsidiaries,
(4) transactions in the ordinary course of business pursuant to
any pension, share or partnership unit option, profit sharing, partnership
unit or share appreciation rights or other employee benefit plan or
agreement (including insurance,
101
indemnification and reimbursement plans and arrangements for directors,
officers and employees),
(5) loans to employees not to exceed $10,000,000 in aggregate
amount at any one time outstanding, or
(6) issuances of Capital Stock (other than Disqualified Capital
Stock) of the Company.
SECTION 10.10 Limitation on Asset Sales.
(a) The Company shall not, and shall not cause or permit any of its
Restricted Subsidiaries to, complete an Asset Sale unless:
(1) the Company or such applicable Restricted Subsidiary, as the
case may be, receives consideration at the time of such sale or other
disposition at least equal to the Fair Market Value of the assets sold or
otherwise disposed of;
(2) not less than 75% of the consideration received by the
Company or such applicable Restricted Subsidiary, as the case may be, is in
the form of (A) cash or Cash Equivalents, or (B) Replacement Assets, and in
each case set forth in subclauses (A) and (B) of this clause (a)(2), is
received at the time of such sale or other disposition; provided that the
amount of (i) any Debt (other than subordinated Debt) of the Company or any
such applicable Restricted Subsidiary that is actually assumed by the
transferee in such Asset Sale and from which the Company and its Restricted
Subsidiaries are fully and unconditionally released and (ii) any securities
received by the Company or any such applicable Restricted Subsidiary which
are converted into cash or Cash Equivalents within ten Business Days of
such Asset Sale (to the extent of the cash or Cash Equivalents received),
will be deemed to be cash for purposes of this clause(a)(2) and to have
been received at the time of such sale; and
(3) the Asset Sale Proceeds received by the Company or such
Restricted Subsidiary, as the case may be, are applied, at the option of
the Company or such Restricted Subsidiary, (A) to prepay, repay or purchase
indebtedness under the Credit Facilities or any other secured Debt of the
Company or such Restricted Subsidiary or the Other Senior Notes; or (B) to
an investment in properties and assets that are used or are useful in the
business of the Company or its Restricted Subsidiaries or in businesses
reasonably similar to or ancillary to the business of the Company or its
Restricted Subsidiaries as conducted at the time of such Asset Sale;
provided that (i) such investment occurs or (ii) the Company or any such
Restricted Subsidiary enters into contractual commitments to so apply such
Asset Sale Proceeds, subject only to customary conditions (other than the
obtaining of financing), in each case, within 365 days following the
receipt of such Asset Sale Proceeds.
If on such 365th day the Available Asset Sale Proceeds exceed
$15,000,000, the Company shall apply an amount equal to the Available Asset
Sale Proceeds to an offer to repurchase the Notes (and, at its option, to
an offer to repurchase other equal and ratable Debt), at a purchase price
in cash equal to 100% of the principal
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amount thereof plus accrued and unpaid interest, if any, to the purchase
date (an "Excess Proceeds Offer").
If an Excess Proceeds Offer is not fully subscribed, the Company
may retain and use for general corporate purposes the portion (any such
portion, a "Deficiency") of the Available Asset Sale Proceeds not required
to repurchase Notes. Upon completion of any Excess Proceeds Offer, the
amount of Available Asset Sale Proceeds shall be reset to zero.
(b) If the Company is required to make an Excess Proceeds Offer, the
Company shall (1) notify the Trustee thereof at least five Business Days prior
to the commencement of the Excess Proceeds Offer and (2) send by first-class
mail, postage prepaid, within 30 days of the 365th day following the receipt of
the Available Asset Sale Proceeds exceeding $15,000,000 as specified in Section
10.10(a)(3), a notice to the Trustee and to each Holder, at the address
appearing in the register maintained by the Security Registrar, stating the
information set forth below. The Excess Proceeds Offer shall remain open for a
period of 20 Business Days following its commencement (the "Offer Period"). The
notice, which shall govern the terms of the Excess Proceeds Offer, shall state:
(A) that the Company is offering to apply the Available Asset
Sale Proceeds, to repurchase such Notes at a purchase price
in cash equal to 100% of the principal amount of the Notes,
plus accrued and unpaid interest, if any, to the purchase
date;
(B) that the Excess Proceeds Offer is being made pursuant to
this Section 10.10 and the length of time the Excess
Proceeds Offer will remain open;
(C) the purchase price and the purchase date (which shall be a
Business Day no earlier than 30 days nor later than 60 days
from the date such notice is mailed);
(D) that any Note not tendered or accepted for payment will
continue to accrue interest;
(E) that, unless the Company defaults in a payment pursuant to
the Excess Proceeds Offer, any Notes accepted for payment
pursuant to the Excess Proceeds Offer shall cease to accrue
interest after the expiration of the Offer Period;
(F) that Holders accepting the offer to have a Note purchased
pursuant to any Excess Proceeds Offer will be required to
surrender the Note, with the form entitled "Option of Holder
to Elect Purchase" on the reverse of the Note completed, to
the Paying Agent at the address specified in the notice
prior to the close of business on the Business Day preceding
the purchase date;
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(G) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than the expiration of
the Offer Period, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the
Note the Holder delivered for purchase and 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 Available Asset Sale Proceeds, the
Company or the Trustee 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 US$1,000, or integral multiples of
US$1,000, shall be purchased);
(I) that Holders whose Notes are being purchased only in part
will be issued new Notes equal in aggregate principal amount
to the unpurchased portion of the Notes surrendered;
provided that each Note purchased and each such new Note
issued shall be in an original principal amount in
denominations of US$1,000 and integral multiples of
US$1,000; and
(J) the calculations used in determining the amount of Available
Asset Sale Proceeds to be applied to the purchase of such
Notes.
The Company shall comply with the requirements of Rule 14e-l under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Notes in connection with an Excess Proceeds Offer. To the extent
that the provisions of any securities laws or regulations conflict with this
Section 10.10, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under this
Section 10.10 by virtue thereof.
SECTION 10.11 Limitation on Capital Stock of Restricted Subsidiaries.
The Company shall not (a) sell, pledge, hypothecate (other than by Permitted
Liens) or otherwise convey or dispose of any Capital Stock of a Restricted
Subsidiary or (b) permit any of its Restricted Subsidiaries to issue any Capital
Stock, other than to the Company or a Wholly Owned Restricted Subsidiary if, as
a result of such transaction, such Restricted Subsidiary would cease to be a
Restricted Subsidiary. The foregoing restrictions shall not apply to an Asset
Sale consisting of all of the Capital Stock of a Restricted Subsidiary owned by
the Company and its Restricted Subsidiaries made in compliance with Section
10.10 hereof.
SECTION 10.12 Limitation on Dividend and Other Payment Restrictions
Affecting Restricted Subsidiaries. The Company shall not, and shall not cause
or permit any of its Restricted Subsidiaries to, directly or indirectly, create
or otherwise cause or suffer to exist or become effective any encumbrance or
restriction on the ability of any Restricted Subsidiary to:
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(a) (1) pay dividends or make any other distributions to the Company
or any Restricted Subsidiary (A) on its Capital Stock or (B) with respect
to any other interest or participation in, or measured by, its profits or
(2) repay any Debt or any other obligation owed to the Company or any
Restricted Subsidiary,
(b) make loans or advances or Capital Contributions to the Company or
any Restricted Subsidiary, or
(c) transfer any of its properties or assets to the Company or any
Restricted Subsidiary, except for such encumbrances or restrictions
existing under or by reason of (1) encumbrances or restrictions existing on
the Issue Date to the extent and in the manner such encumbrances and
restrictions are in effect on the Issue Date, (2) encumbrances or
restrictions in the Credit Facilities, (3) this Indenture, the Notes and
any Guarantees, (4) applicable law, (5) any instrument governing Acquired
Debt 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
(including any Subsidiary of the Person), so acquired, (6) customary
non-assignment provisions in leases or other agreements entered in the
ordinary course of business and consistent with past practices, (7)
Refinancing Debt; provided that such restrictions are not on the whole
materially more restrictive than those contained in the agreements
governing the Debt being extended, refinanced, renewed, replaced, defeased
or refunded, (8) restrictions in security agreements or mortgages securing
Debt of the Company or a Restricted Subsidiary only to the extent such
restrictions restrict the transfer of the property subject to such security
agreements and mortgages, (9) restrictions with respect to a Restricted
Subsidiary pursuant to an agreement that has been entered into for the
sale or disposition of all or substantially all of the Capital Stock or
assets of such Restricted Subsidiary to be consummated in accordance with
the terms of this Indenture solely in respect of the Capital Stock or
assets to be sold or disposed of, (10) purchase money obligations for
property acquired in the ordinary course of business that impose
restrictions of the nature described in clause (c)(8) of this Section 10.12
on the property so acquired, (11)any agreement for the sale of assets
(including any Asset Sale) that restricts transfers of such assets pending
their sale, (12)secured Debt otherwise permitted to be incurred pursuant to
the provisions of the covenant described above under Section 10.08 that
limits the right of the debt or to dispose of the assets securing such
Debt, (13) any encumbrance or restriction contained in Purchase Money Debt
to the extent that such encumbrance or restriction (A) only restricts the
transfer of the Property financed with such Purchase Money Debt and (B)
solely relates to the Property financed with such Purchase Money Debt, or
(14) restrictions on cash or other deposits imposed by customers under
contracts entered into in the ordinary course of business.
SECTION 10.13 Limitation on Subsidiaries. If (a) any Subsidiary
guarantees the Other Senior Notes or (b) the Company or any Restricted
Subsidiary transfers or causes to be transferred any Property to, or organizes,
acquires, invests in or otherwise holds an Investment in, any Restricted
Subsidiary that is not a Guarantor having total consolidated assets with a book
value in excess of $500,000, then such Subsidiary, transferee or acquired or
other Restricted Subsidiary shall (1) execute and deliver to the Trustee a
supplemental indenture in form reasonably satisfactory to the Trustee pursuant
to which such Restricted Subsidiary shall
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unconditionally guarantee all of the Company's obligations under the Notes and
this Indenture in the form set forth in Annex C hereto, (2) deliver to the
Trustee an Opinion of Counsel that such supplemental indenture has been duly
authorized, executed and delivered by such Restricted Subsidiary and constitutes
a legal, valid, binding and enforceable obligation of such Restricted Subsidiary
and (3) execute such other documents and take such other actions as the Trustee
may reasonably require in order to evidence the Guarantee of such Restricted
Subsidiary and the agreement of such Restricted Subsidiary to be bound by the
Guarantee. Thereafter, such Restricted Subsidiary shall be a Guarantor for all
purposes of this Indenture.
SECTION 10.14 Legal Existence. Subject to Article Five hereof, the
Company shall do or cause to be done all things necessary to preserve and keep
in full force and effect its legal existence, and the corporate, partnership or
other existence of each Restricted Subsidiary, in accordance with the respective
organizational documents (as the same may be amended from time to time) of each
Restricted Subsidiary and the rights (charter and statutory), licenses and
franchises of the Company and its Restricted Subsidiaries; provided that the
Company shall not be required to preserve any such right, license or franchise,
or the corporate, partnership or other existence of any of its Restricted
Subsidiaries if the Board of Directors of the Company shall determine that the
preservation there of is no longer desirable in the conduct of the business of
the Company and its Restricted Subsidiaries, taken as a whole, and that the loss
thereof is not adverse in any material respect to the Holders.
SECTION 10.15 Change of Control Offer.
(a) Upon the occurrence of a Change of Control Triggering Event, the
Company shall be obligated to make an offer to purchase (the "Change of Control
Offer") all outstanding Notes at a purchase price (the "Change of Control
Purchase Price") equal to 101% of the principal amount thereof, plus accrued and
unpaid interest to the Change of Control Payment Date, in accordance with this
Section 10.15.
(b) Within 30 days of the occurrence of a Change of Control Triggering
Event, the Company shall (1) cause a notice of the Change of Control Offer to be
sent at least once to the Dow Jones News Service or similar business news
service in the United States and (2) send by first-classmail, postage prepaid,
to the Trustee and to each Holder, at the address appearing in the register of
the Notes maintained by the Security Registrar, a notice stating:
(A) that the Change of Control Offer is being made pursuant to
this Section 10.15 and that all Notes tendered will be
accepted for payment;
(B) the Change of Control Purchase Price and the purchase date
(which shall be a Business Day no earlier than 30 days nor
later than 60 days from the date such notice is mailed (the
"Change of Control Payment Date"));
(C) that any Note not tendered will continue to accrue interest;
(D) that, unless the Company defaults in the payment of the
Change of Control Purchase Price, any Notes accepted for
payment pursuant
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to the Change of Control Offer shall cease to accrue
interest after the Change of Control Payment Date;
(E) that Holders accepting the offer to have a Note purchased
pursuant to any Change of Control Offer will be required to
surrender the Note, with the form entitled "Option of Holder
to Elect Purchase" on the reverse of the Note completed, to
the Paying Agent at the address specified in the notice
prior to the close of business on the Business Day preceding
the Change of Control Payment Date;
(F) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than the close of
business on the third Business Day preceding the Change of
Control Payment Date, facsimile transmission or letter
setting forth the name of the Holder, the principal amount
of the Notes the Holder delivered for purchase, and a
statement that such Holder is withdrawing his election to
have such Note purchased;
(G) that Holders whose Notes are being purchased only in part
will be issued new Notes, representing the same indebtedness
to the extent not repurchased, equal in principal amount to
the unpurchased portion of the Notes surrendered; provided
that each Note purchased and each such new Note issued shall
be in an original principal amount in denominations of
US$1,000 and integral multiples of US$1,000;
(H) any other procedures that a Holder must follow to accept a
Change of Control Offer or effect withdrawal of such
acceptance; and
(I) the name and address of the Paying Agent.
(c) On the Change of Control Payment Date, the Company shall, to the
extent lawful, (1) accept for payment Notes or portions thereof properly
tendered pursuant to the Change of Control Offer, (2) deposit with the Paying
Agent money sufficient to pay the Change of Control Purchase Price of all Notes
or portions thereof so properly tendered and (3) deliver or cause to be
delivered to the Trustee Notes so accepted together with an Officers'
Certificate stating the Notes or portions thereof tendered to the Company. The
Paying Agent shall promptly mail to each Holder of Notes so accepted payment in
an amount equal to the Change of Control Purchase Price for such Notes, and the
Company shall execute and issue, and the Trustee shall promptly authenticate and
mail to such Holder, a new Note equal in principal amount to any unpurchased
portion of the Notes surrendered; provided that each such new Note shall be
issued in an original principal amount in denominations of US$1,000 and integral
multiples of US$1,000.
(d) (1) If the Company or any Restricted Subsidiary has issued any
outstanding (A) Debt that is subordinated in right of payment to the Notes or
(B) Preferred Stock, and the Company or such Restricted Subsidiary is required
to make a Change of Control
107
Offer or to make a distribution with respect to such subordinated Debt or
Preferred Stock in the event of a Change of Control, the Company shall not
consummate any such offer or distribution with respect to such subordinated Debt
or Preferred Stock until such time as the Company shall have paid the Change of
Control Purchase Price in full to the Holders of Notes that have accepted the
Company's Change of Control Offer and shall otherwise have consummated the
Change of Control Offer made to Holders of the Notes and (2) the Company shall
not issue Debt that is subordinated in right of payment to the Notes or
Preferred Stock with Change of Control provisions requiring the payment of such
Debt or Preferred Stock prior to the payment of the Notes in the event of a
Change of Control Triggering Event under this Indenture.
The Company shall comply with the requirements of Rule 14e-l under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Notes in connection with a Change of Control Offer. To the extent
that the provisions of any securities laws or regulations conflict with this
Section 10.15, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under this
Section 10.15 by virtue thereof.
SECTION 10.16 Payment of Additional Amounts.
(a) All amounts paid or credited by the Company under or with respect
to the Notes, or by any Guarantor in respect of its Guarantee shall be made free
and clear of and without withholding or deduction for or on account of any
present or future Taxes, unless the Company or such Guarantor is required to
withhold or deduct any amount for or on account of Taxes by law or by
interpretation or administration of law. If the Company or any Guarantor is
required to withhold or deduct any amount for or on account of Taxes from any
amount paid or credited under or with respect to the Notes or the Guarantees,
the Company or such Guarantor shall pay such additional amounts ("Additional
Amounts") as may be necessary so that the net amount received by each Holder
(including Additional Amounts) after such withholding or deduction (including
any withholding or deduction in respect of Additional Amounts) shall not be less
than the amount the Holder would have received if such Taxes had not been
withheld or deducted; provided that no Additional Amounts will be payable with
respect to a payment made to a Holder (an "Excluded Holder") (1) with whom the
Company or such Guarantor does not deal at arm's length (within the meaning of
the Income Tax Act (Canada)) at the time of making such payment, (2) who is
subject to the Taxes in question by reason of its being connected with the
jurisdiction imposing such Taxes otherwise than by the mere acquisition or
holding of the Notes or the receipt of payments thereunder or the enforcement of
its rights thereunder, or (3) who is subject to such Taxes because the Holder is
or is deemed to be resident in Canada or uses or holds or is deemed or
considered to use or hold the Notes in carrying on business in Canada for
purposes of the Income Tax Act (Canada). The Company and any Guarantors will
also (a) make such withholding or deduction and (b) remit the full amount
deducted or withheld to the relevant authority in accordance with and in the
time required under applicable law. The Company and any Guarantors shall furnish
to the Holders (other than Excluded Holders) of Notes that are outstanding on
the date of the withholding or deduction, within 30 days after the date of the
payment of any Taxes due under applicable law, certified copies of tax receipts
evidencing such payment by the Company or such Guarantor.
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(b) The Company and any Guarantors shall, upon written request of any
Holder (other than an Excluded Holder), reimburse each such Holder, for the
amount of (1) any such Taxes so required to be withheld or deducted which are
levied or imposed on and paid by such Holder or the beneficial owner of the
Notes as a result of payments made under or with respect to the Notes or the
Guarantees and reasonable expenses related thereto; and (2) any such Taxes so
levied or imposed with respect to any reimbursement under the foregoing clause
(1) so that the net amount received by such Holder or beneficial owner after
such reimbursement will not be less than the net amount the Holder or beneficial
owner would have received if Taxes described in subclauses (1) and (2) of this
paragraph had not been imposed, but excluding any such Taxes on such Holder's or
beneficial owner's net income generally.
(c) At least 30 days prior to each date on which any payment under or
with respect to the Notes is due and payable, if the Company or any Guarantor
shall be obligated to pay Additional Amounts with respect to such payment, the
Company or such Guarantor shall deliver to the Trustee an Officers' Certificate
stating the fact that such Additional Amounts shall be payable and specifying
the amounts so payable and will set forth such other information necessary to
enable the Trustee to pay such Additional Amounts to Holders on the payment
date. Whenever in this Indenture there is mentioned, in any context, principal,
premium, if any, interest or any other amount payable under or with respect to
any Note, such mention shall be deemed to include the payment of Additional
Amounts to the extent that, in such context, Additional Amounts are, were or
would be payable in respect thereof.
(d) The Company or any Guarantor shall pay any present or future
stamp, court, documentary or other similar taxes, charges or levies that arise
in any Taxing Jurisdiction from the execution, delivery or registration of, or
enforcement of rights under the Notes, this Indenture or any related document.
SECTION 10.17 Limitation on Applicability of Certain Covenants if the
Notes Are Rated Investment Grade. Notwithstanding any other provision of this
Indenture, in the event that (a) the Notes are rated Investment Grade and (b) no
Event of Default or Default shall have occurred and be continuing (the
satisfaction of the foregoing requirements being collectively referred to as the
"Fall-away Event"), upon the delivery to the Trustee of an Officers' Certificate
to the effect that a Fall-away Event has occurred, the provisions of Sections
10.06, 10.07, 10.09, 10.10, 10.12, 10.15 and clause (a)(3) of Section 8.01 of
this Indenture shall terminate and shall thereafter be deemed not to form a part
of this Indenture and the Company and its Restricted Subsidiaries shall
thereafter have no obligation or liability in respect of such sections,
notwithstanding that the Notes may later cease to be rated Investment Grade.
ARTICLE XI
REDEMPTION OF SECURITIES
SECTION 11.01 Election to Redeem; Notices to Trustee. If the Company
elects to redeem Notes pursuant to Section 11.07 or 11.08 of this Indenture, at
least 45 days prior to the Redemption Date (unless a shorter notice shall be
agreed to in writing by the Trustee) but not more than 65 days before the
Redemption Date, the Company shall notify the Trustee in writing of the
Redemption Date, the aggregate principal amount of Notes to be redeemed and the
109
redemption price, and deliver to the Trustee an Officers' Certificate stating
that such redemption will comply with the conditions contained in Section 11.07
or 11.08 of this Indenture. Notice given to the Trustee pursuant to this Section
11.01 may not be revoked after the time that notice is given to Holders pursuant
to Section 11.03 hereof.
SECTION 11.02 Selection by Trustee of Notes To Be Redeemed. In the
event that fewer than all of the Notes are to be redeemed, the Trustee shall
select the Notes to be redeemed, if the Notes are listed on a national
securities exchange, in accordance with the rules of such exchange or, if the
Notes are not so listed, either on a pro rata basis, by lot or in such other
manner as the Trustee shall deem fair and equitable; provided, however, that if
a partial redemption is made with the proceeds of a Public Equity Offering,
selection of the Notes or portions thereof for redemption shall be made by the
Trustee only on a pro rata basis or on as nearly a pro rata basis as is
practicable (subject to DTC procedures), unless such method is otherwise
prohibited. The Trustee shall promptly notify the Company of the Notes selected
for redemption and, in the case of any Notes selected for partial redemption,
the principal amount thereof to be redeemed. The Trustee may select for
redemption portions of the principal of the Notes that have denominations larger
than US$1,000. Notes and portions thereof the Trustee selects shall be redeemed
in amounts of US$1,000 or whole multiples of US$1,000. For all purposes of this
Indenture unless the context otherwise requires, provisions of this Indenture
that apply to Notes called for redemption also apply to portions of Notes called
for redemption.
SECTION 11.03 Notice of Redemption. (a) At least 30 days, and no more
than 60 days, before a Redemption Date, the Company shall mail, or cause to be
mailed, a notice of redemption by first-class mail to each Holder of Notes to be
redeemed at his or her last address as the same appears on the registry books
maintained by the Security Registrar.
(b) The notice shall identify the Notes to be redeemed (including the
CUSIP or ISIN numbers thereof, if any) and shall state:
(1) the Redemption Date;
(2) the redemption price and the amount of premium, if any, and
accrued and unpaid interest to be paid;
(3) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the Redemption
Date and upon surrender of such Note, a new Note or Notes in principal
amount equal to the unredeemed portion will be issued;
(4) the name and address of the Paying Agent;
(5) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(6) that unless the Company defaults in making the redemption payment,
interest on Notes called for redemption ceases to accrue on and after the
Redemption Date;
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(7) the provision of this Indenture pursuant to which the Notes called
for redemption are being redeemed;
(8) the aggregate principal amount of Notes that are being redeemed;
and
(9) that no representation is made as to the correctness or accuracy
of the CUSIP or ISIN number, if any, listed in such notice or printed on
the Notes.
(c) At the Company's written request made at least two Business Days
prior to the date on which notice is to be given, the Trustee shall give the
notice of redemption in the Company's name and at the Company's sole expense;
provided, however, that the Company shall deliver to the Trustee at least 45
days prior to the Redemption Date an Officers' Certificate requesting that the
Trustee give such notice and setting forth the information to be stated in such
notice as provided in the preceding paragraph.
SECTION 11.04 Effect of Notice of Redemption. Once the notice of
redemption described in Section 11.03 hereof is mailed, Notes called for
redemption become due and payable on the Redemption Date and at the redemption
price, including premium, if any, plus accrued and unpaid interest to the
Redemption Date. Upon surrender to the Paying Agent, such Notes shall be paid at
the redemption price, including premium, if any, plus accrued and unpaid
interest to the Redemption Date; provided that if the Redemption Date is after a
regular record date and on or prior to the Interest Payment Date, the accrued
interest shall be payable to the Holder of the redeemed Notes registered on the
relevant record date; provided, further, that if a Redemption Date is a Legal
Holiday, payment shall be made on the next succeeding Business Day and no
interest shall accrue for the period from such Redemption Date to such
succeeding Business Day.
SECTION 11.05 Deposit of Redemption Price. (a) On or prior to
10:00 a.m., New York City time, on each Redemption Date, the Company shall
deposit with the Paying Agent in immediately available funds money sufficient to
pay the redemption price of, including premium, if any, and accrued and unpaid
interest on all Notes to be redeemed on that date other than Notes or portions
thereof called for redemption on that date which have been delivered by the
Company to the Trustee for cancellation.
(b) On and after any Redemption Date, if money sufficient to pay the
redemption price of, including premium, if any, and accrued and unpaid interest
on Notes called for redemption shall have been deposited with the Paying Agent
in accordance with the preceding paragraph, the Notes called for redemption will
cease to accrue interest and the only right of the Holders of such Notes will be
to receive payment of the redemption price of, premium, if any, and, subject to
the first proviso in Section 11.04 hereof, accrued and unpaid interest on such
Notes to the Redemption Date. If any Note surrendered for redemption shall not
be so paid, interest will be paid, from the Redemption Date until such
redemption payment is made, on the unpaid principal of the Note and any interest
not paid on such unpaid principal, in each case, at the rate and in the manner
provided in the Notes.
SECTION 11.06 Notes Redeemed in Part. Any Note which is to be
redeemed only in part shall be surrendered at an office or agency of the Company
designated for that
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purpose pursuant to Section 11.03 (with, if the Company or the Trustee so
requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company and the Trustee duly executed by, the Holder thereof
or his attorney duly authorized in writing), and the Company shall execute, and
the Trustee shall authenticate and deliver to the Holder of such Security
without service charge, a new Security or Securities, of any authorized
denomination as requested by such Holder, in aggregate stated amount at maturity
equal to and in exchange for the unredeemed portion of the stated amount at
maturity of the Security so surrendered.
SECTION 11.07 Optional Redemption. The Company, at its option, may
redeem the Notes, in whole at any time, or in part from time to time, in each
case, on or after March 1, 2009, upon not less than 30 nor more than 60 days'
notice, at the redemption prices (expressed as percentages of principal amount
thereof) set forth below, together, in each case, with accrued and unpaid
interest to the Redemption Date, if redeemed during the twelve month period
beginning on March 1 of each year listed below:
Year Redemption Price
- ---- ----------------
2009.................. 103.688%
2010.................. 102.458%
2011.................. 101.229%
2012 and thereafter... 100.000%
Notwithstanding the foregoing, the Company, at its option, may redeem
in the aggregate up to 35% of the original principal amount of Notes at any time
and from time to time prior to March 1, 2007 at a redemption price equal to
107.375% of the aggregate principal amount so redeemed, plus accrued and unpaid
interest to the Redemption Date, out of the net cash proceeds of one or more
Public Equity Offerings of Common Stock of the Company; provided that at least
65% of the aggregate principal amount of Exchange Securities and any Notes that
have not been exchanged for Exchange Securities remains outstanding immediately
after the occurrence of any such redemption and that any such redemption occurs
within 90 days following the closing of any such Public Equity Offering.
SECTION 11.08 Tax Redemption. (a) The Notes are redeemable, in whole
but not in part, at the option of the Company at any time, upon not less than 30
nor more than 60 calendar days' prior written notice, mailed by first class mail
to each Holder at its last address appearing in the register of Notes maintained
by the Security Registrar, at 100% of the principal amount thereof, plus accrued
and unpaid interest thereon to the Redemption Date, if the Company or any
Guarantor is or would become obligated to pay, on the next date on which any
amount would be payable with respect to the Notes or the Guarantees, any
Additional Amounts as a result of a change in or amendment to, the laws (or any
regulations promulgated thereunder) of any Taxing Authority, or any changes in,
or amendment to, any official position regarding the application or
interpretation of such laws or regulations, which change or amendment is
announced on or after the Issue Date; provided that the Company or such
Guarantor determines, in its business judgment, that the obligation to pay such
Additional Amounts cannot be avoided by the use of reasonable measures available
to the Company or such Guarantor (not including substitution of the obligor
under the Notes); and provided, further, that (1) no such notice of redemption
may be given earlier than 90 days prior to the earliest date on which the
Company or
112
such Guarantor would but for such redemption be obligated to pay such
Additional Amounts or later than 270 days after the Company or such Guarantor
first becomes liable to pay any Additional Amounts as a result of any changes in
or amendments to laws, regulations or official positions described above and (2)
at the time such notice is given, the Company's or such Guarantor's obligation
to pay such Additional Amounts remains in effect.
(b) Prior to the publication of any notice of redemption pursuant to
this provision, the Company will deliver to the Trustee (1) an Officers'
Certificate stating that the Company is entitled to effect such redemption and
setting forth a statement of facts showing that the conditions precedent to the
right of the Company so to redeem have occurred and (2) an Opinion of Counsel
qualified under the laws of the relevant jurisdiction to the effect that the
Company or such Guarantor has or will become obligated to pay such Additional
Amounts as a result of such amendment or change as described above.
SECTION 11.09 Purchase of Notes. The Company or any of its
Subsidiaries shall have the right at any time and from time to time to purchase
Notes in the open market (which shall include purchase from or through an
investment dealer, investment bank or firm holding membership in a stock
exchange or the National Association of Securities Dealers, Inc.) or by tender
or by private contract or otherwise, at any price, provided that the Company
complies with any securities laws or regulations applicable to any such purchase
including, but not limited to Rule 14e-] under the Exchange Act.
ARTICLE XII
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 12.01 Company's Option to Effect Defeasance or Covenant
Defeasance. The Company may at its option by Board Resolution, at any time,
elect to have either Section 12.02 or Section 12.03 applied to the Notes then
outstanding upon compliance with the conditions set forth below in this Article
Twelve.
SECTION 12.02 Defeasance and Discharge. Upon the Company's exercise
of the option provided in Section 12.01 applicable to this Section, the Company
shall be deemed to have been discharged from its obligations with respect to the
Notes on the date the conditions set forth below are satisfied (hereinafter,
"defeasance"). Forth is purpose, such defeasance means that the Company shall be
deemed to have paid and discharged the entire indebtedness represented by the
Notes and to have satisfied all its other obligations under such Securities and
this Indenture insofar as such Securities are concerned (and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging the
same), except for the following which shall survive until otherwise terminated
or discharged hereunder: (i) the rights of Holders of such Securities to
receive, solely from the trust fund described in Section 12.04 and as more fully
set forth in such Section, payments in respect of the principal amount of,
premium, if any and interest on such Securities when such payments are due, (ii)
the Company's obligations with respect to such Securities under Sections 3.05,
3.06, 5.15, 10.02 and 10.16, (iii) the rights, powers, trusts, duties and
immunities of the Trustee hereunder (including, claims of, or payments to the
Trustee under Section 6.07 hereof) and (iv) this Article Twelve. Subject to
compliance
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with this Article Twelve, the Company may exercise its option under this Section
12.02 notwithstanding the prior exercise of its option under Section 12.03.
SECTION 12.03 Covenant Defeasance. Upon the Company's exercise of the
option provided in Section 12.01 applicable to this Section, (a) the Company
shall be released from its obligations under clauses (3), (4), (5), (6), (7)
and (8) of Section 5.01(a), Section 5.15, Section 8.01(a)(3), Sections 10.04
through 10.15, inclusive, and Section 10.17 (b) the occurrence of an event
specified in Sections 5.01(a)(3) (with respect to clauses (3), (4), (5), (6),
(7) or (8) of Section 5.01(a), Section 5.15, Section 8.01(a)(3), Sections 10.04
through 10.15, inclusive, and Section 10.17), 5.01(a)(4), 5.01(a)(5), 5.01(a)(6)
and 5.01(a)(7) shall not be deemed to be an Event of Default (hereinafter,
"covenant defeasance"). For this purpose, such covenant defeasance means that
the Company may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such Section, clause or
Article, whether directly or indirectly by reason of any reference elsewhere
herein to any such Section, clause or Article or by reason of any reference in
any such Section, clause or Article to any other provision herein or in any
other document, but the remainder of this Indenture and such Securities shall be
unaffected thereby.
SECTION 12.04 Conditions to Defeasance or Covenant Defeasance.
(a) The following shall be the conditions to application of either
Section 12.02 or Section 12.03 to the then outstanding Notes:
(1) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements
of Section 6.09 who shall agree to comply with the provisions of this
Article Twelve applicable to it) as trust funds in trust for the purpose of
making the following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such Securities, (A)
money in an amount, or (B) U.S. Government Securities which through the
scheduled payment of principal and interest in respect thereof in
accordance with their terms will provide, not later than one day before the
due date of any payment, money in an amount, or (C) a combination thereof,
in such amounts as will be sufficient, in the opinion of
a nationally-recognized firm of independent public accountants expressed in
a written certification thereof delivered to the Trustee, to pay and
discharge the principal of, premium, if any, and accrued and unpaid
interest on the Notes, at the Maturity Date of such principal, premium, if
any, or interest, or on dates for payment and redemption of such principal,
premium, if any, and interest selected in accordance with the terms of this
Indenture and the Notes; provided that the Trustee shall have been
irrevocably instructed in writing to apply such money or the proceeds of
such U.S. Government Securities to the payment of such principal, premium,
if any, and interest with respect to the Notes;
(2) In the case of an election under Section 12.02, the Company
shall have delivered to the Trustee an Opinion of Counsel stating that:
114
(A) the Company has received from, or there has been
published by, the Internal Revenue Service or Canada Customs and
Revenue Agency a ruling, or
(B) the applicable U.S. Federal or Canadian income tax law
provides or since the date of this Indenture there has been a change
in the applicable U.S. or Canadian federal income tax law,
in either case to the effect that, and based thereon such opinion
shall confirm that, the Holders of the Notes will not recognize income
gain or loss for U.S. or Canadian federal income tax purposes as a
result of such deposit, defeasance and discharge and will be subject
to U.S. or Canadian federal income tax on the same amount, in the same
manner and at the same times as would have been the case if such
deposit, defeasance and discharge had not occurred;
(3) In the case of an election under Section 12.03, the Company
shall have delivered to the Trustee an Opinion of Counsel to the effect
that the Holders of the Notes will not recognize income gain or loss for
U.S. or Canadian federal income tax purposes as a result of such deposit
and covenant defeasance and will be subject to U.S. or Canadian federal
income tax on the same amount, in the same manner and at the same times as
would have been the case if such deposit and covenant defeasance had not
occurred;
(4) No Event of Default or event which with notice or lapse of
time or both would become an Event of Default shall have occurred and be
continuing on the date of such deposit or, insofar as Section 5.01(a)(6)
and (7) are concerned, at any time during the period ending on the 91st day
after the date of such deposit (it being understood that this condition
shall not be deemed satisfied until the expiration of such period);
(5) The Company shall have delivered to the Trustee an Opinion of
Counsel substantially to the effect that, after the passage of 123 days
following the deposit (except, with respect to any trust funds for the
account of any Holder who may be deemed to be an "insider" for purposes of
the United States Bankruptcy Code, after one year following the deposit),
the trust funds will not be subject to the effect of Section 547 of the
United States Bankruptcy Code or Section 15 of the New York Debtor and
Credit or Law in a case commenced by or against the Company under either
such statute;
(6) Such deposit, defeasance or covenant defeasance and discharge
shall not result in a breach or violation of, or constitute a default
under, any other material agreement or instrument to which the Company or
any Restricted Subsidiary is a party or by which the Company or any
Restricted Subsidiary is bound;
(7) The Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit under clause(1) of this Section 12.04
was not made by the Company with the intent of preferring the Holders of
the Notes over any other
115
creditors of the Company or with the intent of defeating, hindering,
delaying or defrauding any other creditors of the Company or others; and
(8) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the defeasance under Section
12.02 or the covenant defeasance under Section 12.03 (as the case may be)
have been complied with.
SECTION 12.05 Deposited Money and U.S. Government Securities to be
Held in Trust: Other Miscellaneous Provisions.
(a) Subject to the provisions of Section 12.03, all money and U.S.
Government Securities (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively, for purposes of this Section
12.05, the "Trustee") pursuant to Section 12.04 in respect of the Securities
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Securities and this Indenture, to the payment, either
directly or through any Paying Agent (including the Company acting as its own
Paying Agent) as the Trustee may determine, to the Holders of such Securities,
of all sums due and to be come due thereon in respect of principal (and premium,
if any) and interest, but such money need not be segregated from other funds
except to the extent required by law.
(b) The Company and any Guarantors shall (on a joint and several
basis) pay and indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against the U.S. Government Securities deposited pursuant
to Section 12.04 or the principal and interest received in respect thereof
other than any such tax, fee or other charge which by law is for the account of
the Holders of Notes.
(c) Anything in this Article Twelve to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Securities held by it as provided in
Section 12.04 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect an equivalent defeasance or covenant
defeasance.
SECTION 12.06 Reinstatement. If the Trustee or the Paying Agent is
unable to apply any money in accordance with Section 12.02 or 12.03 by reason of
any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, then the Company's and
each Guarantor's obligations under this Indenture, the Notes and the Guarantees,
as the case may be, shall be revived and reinstated as though no deposit had
occurred pursuant to this Article Twelve until such time as the Trustee or
Paying Agent is permitted to apply all such money in accordance with Section
12.02 or 12.03; provided that if the Company or any Guarantors have made any
payment of principal of, premium, if any, or accrued interest on any Notes
because of the reinstatement of their obligations, the Company or such
Guarantor, as the case may be, shall be subrogated to the rights of the Holders
of such Notes to receive such payment from the money or U.S. Government
Securities, as the case may be, held by the Trustee or Paying Agent.
116
ARTICLE XIII
GUARANTEE OF NOTES
SECTION 13.01 Guarantee. (a) Subject to the provisions of this
Article Thirteen each Guarantor hereby jointly and severally unconditionally
guarantees, on a senior unsecured basis, to each Holder of a Note authenticated
and delivered by the Trustee and to the Trustee and its successors, irrespective
of (i) the validity and enforceability of this Indenture, the Notes or the
obligations of the Company or any other Guarantors to the Holders or the Trustee
hereunder or thereunder or (ii) the absence of any action to enforce the same or
any other circumstance which might otherwise constitute a legal or equitable
discharge or default of a Guarantor, that: (a) the principal of, premium, if
any, interest and Additional Interest, if any, on and any Additional Amounts, if
any, with respect to the Notes will be duly and punctually paid in full when
due, whether at maturity, by acceleration or otherwise, and interest on the
overdue principal and (to the extent permitted by law) interest or Additional
Interest, if any, on or Additional Amounts, if any, with respect to the Notes
and all other obligations of the Company or any Guarantor to the Holders or the
Trustee hereunder or thereunder (including amounts due the Trustee under Section
6.07 hereof) and all other obligations under this Indenture or the Notes 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, 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. Failing payment when
due of any amount so guaranteed, or failing performance of any other obligation
of the Company to the Holders, for whatever reason, each Guarantor will be
obligated to pay, or to perform or cause the performance of, the same
immediately. An Event of Default under this Indenture or the Notes shall
constitute an event of default under this Guarantee, and shall entitle the
Holders of Notes or the Trustee to accelerate the obligations of the Guarantors
hereunder in the same manner and to the same extent as the obligations of the
Company.
(b) Each Guarantor, by execution of the Guarantee, agrees that its
obligations hereunder shall be unconditional, irrespective of the validity,
regularity or enforceability of this Indenture or the Notes, the absence of any
action to enforce the same, any waiver or consent by any Holder with respect to
any provisions hereof or thereof, any release of any other Guarantor, the
recovery of any judgment against the Company, any action to enforce the same,
whether or not a Guarantee is affixed to any particular Note, or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a Guarantor. Each Guarantor, by execution of the Guarantee, waives
the benefit of diligence, presentment, demand for payment, filing of claims with
a court in the event of insolvency or bankruptcy of the Company, any right to
require a proceeding first against the Company, protest, notice and all demands
whatsoever and covenant that such Guarantee will not be discharged except by
complete performance of the obligations contained in the Notes, this Indenture
and such Guarantee. The Guarantee is a guarantee of payment and not of
collection. If any Holder or the Trustee is required by any court or otherwise
to return to the Company or to any Guarantor, or any custodian, trustee,
liquidator or other similar official acting in relation to the Company or such
Guarantor, any amount paid by the Company or such Guarantor to the Trustee or
such Holder, the Guarantee, to the extent theretofore discharged, shall be
reinstated in full force and effect. Each Guarantor further agrees that, as
between it, on the one hand, and the Holders and the
117
Trustee, on the other hand, (a) subject to this Article Thirteen, the maturity
of the obligations guaranteed hereby may be accelerated as provided in Article
Five hereof for the purposes of the Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (b) in the event of any acceleration of such
obligations as provided in Article Five hereof, such obligations (whether or not
due and payable) shall forthwith become due and payable by the Guarantors for
the purpose of such Guarantee.
(c) The Guarantee shall remain in full force and effect and continue
to be effective should any petition be filed by or against the Company for
liquidation or reorganization, should the Company become insolvent or make an
assignment for the benefit of creditors or should a receiver or trustee be
appointed for all or any significant part of the Company's assets, and shall, to
the fullest extent permitted by law, continue to be effective or be reinstated,
as the case may be, if at any time payment and performance of the Notes are
pursuant to applicable law, rescinded or reduced in amount, or must otherwise be
restored or returned by any obligee on the Notes, whether as a "voidable
preference," "fraudulent transfer" or otherwise, all as though such payment or
performance had not been made. In the event that any payment, or any part
thereof, is rescinded, reduced, restored or returned, the Notes shall, to the
fullest extent permitted by law, be reinstated and deemed reduced only by such
amount paid and not so rescinded, reduced, restored or returned.
SECTION 13.02 Execution and Delivery of Guarantee. (a) To further
evidence the Guarantee set forth in Section 13.01 hereof, each Guarantor hereby
agrees that a notation of such Guarantee, substantially in the form included in
Annex C hereto, shall be endorsed on each Note authenticated and delivered by
the Trustee after this Article Thirteen with respect to such Guarantor becomes
effective in accordance with Section 10.13 hereof and such Guarantee shall be
executed by either manual or facsimile signature of an Officer of each
Guarantor. The validity and enforceability of any Guarantee shall not be
affected by the fact that it is not affixed to any particular Note.
(b) Each of the Guarantors hereby agrees that its Guarantee set forth
in Section 13.01 hereof shall remain in full force and effect notwithstanding
any failure to endorse on each Note a notation of such Guarantee.
(c) If an Officer of a Guarantor whose signature is on this Indenture
or a Guarantee no longer holds that office at the time the Trustee authenticate
the Note on which such Guarantee is endorsed or at any time thereafter, such
Guarantor's Guarantee of such Note shall be valid nevertheless.
(d) The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of any Guarantee set forth in
this Indenture on behalf of the Guarantor.
SECTION 13.03 Limitation of Guarantee. The obligations of each
Guarantor are limited to the maximum amount as will, after giving effect to all
other contingent and fixed liabilities of such Guarantor and after giving effect
to any collections from or payments made by or on behalf of any other Guarantor
in respect of the obligations of such other Guarantor under its Guarantee or
pursuant to its contribution obligations under this Indenture, result in the
118
obligations of such Guarantor under the Guarantee not constituting a fraudulent
conveyance or fraudulent transfer under federal or state law. Each Guarantor
that makes a payment or distribution under a Guarantee shall be entitled to a
contribution from each other Guarantor in a pro rata amount based on the net
assets of each Guarantor, determined in accordance with GAAP.
SECTION 13.04 Additional Guarantors. Any Person may become a
Guarantor by executing and delivering to the Trustee a supplemental indenture in
accordance with Section 10.13 hereof.
SECTION 13.05 Release of Guarantor. (a) A Guarantor shall be released
from all of its obligations under its Guarantee if:
(1) the Guarantor has sold all of its assets or the Company and
its Restricted Subsidiaries have sold all of the Capital Stock of the
Guarantor owned by them, in each case in a transaction in compliance
with the terms of this Indenture (including Sections 10.10 and 8.01
hereof);
(2) the Guarantor merges or amalgamates with or into or
consolidates with, or transfers all or substantially all of its assets
to, the Company or another Guarantor in a transaction in compliance
with Section 8.01 hereof; or
(3) the Guarantor is designated an Unrestricted Subsidiary in
compliance with the terms of this Indenture;
and in each such case, the Guarantor has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to such transactions have been complied
with and that such release is authorized and permitted hereunder.
(b) If all of the conditions to release contained in this Section
13.05 have been satisfied, the Trustee shall execute any documents reasonably
requested by the Company or any Guarantor in order to evidence the release of
such Guarantor from its obligations under its Guarantee endorsed on the Notes
and under this Article Thirteen.
SECTION 13.06 Waiver of Subrogation. Each Guarantor, by execution of
its Guarantee, waives to the extent permitted by law any claim or other rights
which it may now or hereafter acquire against the Company that arise from the
existence, payment, performance or enforcement of such Guarantor's obligations
under such Guarantee and this Indenture, including, without limitation, any
right of subrogation, reimbursement, exoneration, indemnification, and any right
to participate in any claim or remedy of any Holder against the Company, whether
or not such claim, remedy or right arises in equity, or under contract, statute
or common law, including, without limitation, the right to take or receive from
the Company, directly or indirectly, in cash or other property or by set-off or
in any other manner, payment on account of such claim or other rights. If any
amount shall be paid to any Guarantor in violation of the preceding sentence and
the Notes shall not have been paid in full, such amount shall have been deemed
to have been paid to such Guarantor for the benefit of, and held in trust for
the benefit of, the Holders of the Notes, and shall forthwith be paid to the
Trustee for the benefit of such
119
Holders to be credited and applied upon the Notes, whether matured or unmatured,
in accordance with the terms of this Indenture. Each Guarantor, by execution of
its Guarantee, will acknowledge that it will receive direct and indirect
benefits from the financing arrangements contemplated by this Indenture and that
the waiver set forth in this Section 13.06 is knowingly made in contemplation of
such benefits.
----------
120
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the day and year first above written.
ISSUER:
NORSKE SKOG CANADA LIMITED
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
THE GUARANTORS:
ELK FALLS PULP AND PAPER LIMITED
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
NORSKE SKOG CANADA (JAPAN) LIMITED
By: /s/ JAMES E. ARMITAGE
------------------------------------
Name:
Title:
NORSKE SKOG CANADA FINANCE LIMITED
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
NORSKE SKOG CANADA PULP OPERATIONS
LIMITED
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
NORSKE SKOG CANADA PULP SALES INC.
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
NORSKE SKOG CANADA SALES INC.
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
NORSKE SKOG CANADA SERVICES (HUNGARY)
LIMITED LIABILITY COMPANY
By: Illegible
------------------------------------
Name:
Title:
NORSKE SKOG CANADA (USA) INC.
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
NSCL HOLDINGS INC.
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
PACIFICA PAPERS SALES LTD.
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
PACIFICA PAPERS SALES INC.
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
PACIFICA POLARS LTD.
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
PACIFICA POLARS INC.
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
PACIFICA PAPERS US INC.
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
NORSKECANADA
by its managing general partner,
Norske Skog Canada Limited
By: /s/ PETER STAIGER
------------------------------------
Name:
Title:
WELLS FARGO BANK,
NATIONAL ASSOCIATION
as Trustee
By: /s/ Jane Y. Schweiger
------------------------------------
Name: Jane Y. Schweiger
Title: Vice President
ANNEX A -- Form of
Regulation S Certificate
REGULATION S CERTIFICATE
Wells Fargo Bank, National Association,
As Trustee
213 Court Street
Suite 703
Middletown, Connecticut 06457
Re: Norske Skog Canada Limited
7-3/8% Senior Notes due March 1, 2014 (the "Securities")
Reference is hereby made to the Indenture, dated as of March 23, 2004
(the "Indenture"), among Norske Skog Canada Limited and Wells Fargo Bank,
National Association, as Trustee. Terms used but not defined herein and defined
in Regulation S or in the Indenture shall have the meanings given to them in
Regulation S or the Indenture, as the case maybe.
This certificate relates to U.S. $__________ aggregate principal
amount of Notes, which are evidenced by the following certificate (s) (the
"Specified Securities"):
ISIN No(s). __________________________________
CERTIFICATE No(s). ___________________________
The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Securities or (ii) it is acting on behalf of all the beneficial owners
of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Securities are represented by a Global Security, they are held
through the U.S. Depositary or an Agent Member in the name of the Undersigned,
as or on behalf of the Owner. If the Specified Securities are not represented by
a Global Security, they are registered in the name of the Undersigned, as or on
behalf of the Owner.
The Owner has requested that the Specified Securities be transferred
to a person (the "Transferee") who will take delivery in the form of a
Regulation S Security or an interest therein. In connection with such transfer,
the Owner hereby certifies that, unless such transfer is being effected pursuant
to an effective registration statement under the Securities Act, such transfer
is being effected in accordance with Rule 904 or Rule 144 under the Securities
Act and with all applicable securities laws of the states of the United States
and other jurisdictions. Accordingly, the Owner hereby further certifies as
follows:
(a) the Owner is not a distributor of the Securities, an
affiliate of the Company or any such distributor or a person acting on
behalf of any of the foregoing:
A-1
(b) the offer of the Specified Securities was not made to a
person in the United States;
(c) either:
(i) at the time the buy order was originated, the Transferee
was outside the United States or the Owner and any person acting
on its behalf reasonably believed that the Transferee was outside
the United States, or
(ii) the transaction is being executed in, on or through the
facilities of the Eurobond market, as regulated by the
Association of International Bond Dealers, or another designated
offshore securities market and neither the Owner nor any person
acting on its behalf knows that the transaction has been
prearranged with a buyer in the United States;
(d) no directed selling efforts in contravention of the
requirements of Rule 904(b) have been made in the United States by or
on behalf of the Owner or any affiliate thereof;
(e) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(f) we have advised the Transferee of the transfer restrictions
applicable to the Notes.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchasers under the
Purchase Agreement. You and the Company are each entitled to rely upon this
letter and are irrevocably authorized to produce this letter or a copy hereof to
any interested party in any administrative or legal proceedings or official
inquiry with respect to the matters covered hereby.
Dated:
-----------------
(Print the name of the Undersigned, as
such term is defined in the second
paragraph of this certificate.)
By:
------------------------------------
Name:
Title:
(If the Undersigned is a corporation,
partnership or fiduciary, the title of
the person signing on behalf of the
Undersigned must be stated.)
A-2
ANNEX B -- Form of
Restricted Securities Certificate
RESTRICTED SECURITIES CERTIFICATE
Wells Fargo Bank, National Association,
As Trustee
213 Court Street
Suite 703
Middletown, Connecticut 06457
Re: Norske Skog Canada Limited
7-3/8% Senior Notes due March 1, 2014 (the "Securities")
Reference is hereby made to the Indenture, dated as of March 23, 2004
(the "Indenture"), among Norske Skog Canada Limited and Wells Fargo Bank,
National Association, as Trustee. Terms used but not defined herein and defined
in Rule 144A or in the Indenture shall have the meanings given to them in Rule
144A or the Indenture, as the case may be.
This certificate relates to U.S. $__________ aggregate principal
amount of Notes, which are evidenced by the following certificate(s) (the
"Specified Securities"):
CUSIP No(s). _________________________________
CERTIFICATE No(s). ___________________________
The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Securities are represented by a Global Security, they are held
through the U.S. Depositary or an Agent Member in the name of the Undersigned,
as or on behalf of the Owner. If the Specified Securities are not represented by
a Global Security, they are registered in the name of the Undersigned, as or on
behalf of the Owner.
The Owner has requested that the Specified Securities be transferred
to a person (the Transferee") who will take delivery in the form of a Restricted
Security or an interest therein. In connection with such transfer, the Owner
hereby certifies that such transfer is being effected in accordance with Rule
144A under the Securities Act and all applicable securities laws of the states
of the United States and other jurisdictions. Accordingly, the Owner hereby
further certifies as:
(a) the Specified Securities are being transferred to a person
that the Owner and any person acting on its behalf reasonably believe
is a "qualified
B-1
institutional buyer" within the meaning of Rule 144A, acquiring for
its own account or for the account of a qualified institutional buyer;
and
(b) the Owner and any person acting on its behalf have taken
reasonable steps to ensure that the Transferee is aware that the Owner
may be relying on Rule 144A in connection with the transfer; and
(c) the Specified Securities are being transferred in compliance
with any applicable blue sky securities law of all applicable states
of the United States.
Upon giving effect to this request to exchange a beneficial interest
in Regulation S Global Securities for a beneficial interest in the Restricted
Global Security, the resulting beneficial interest shall be subject to the
restrictions on transfer applicable to the Restricted Global Securities pursuant
to the Indenture and the Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchasers under the
Purchase Agreement. You and the Company are each entitled to rely upon this
letter and are irrevocably authorized to produce this letter or a copy hereof
to any interested party in any administrative or legal proceedings or official
inquiry with respect to the matters covered hereby.
Dated:
-----------------
(Print the name of the Undersigned, as
such term is defined in the second
paragraph of this certificate.)
By:
------------------------------------
Name:
Title:
(If the Undersigned is a corporation,
partnership or fiduciary, the title of
the person signing on behalf of the
Undersigned must be stated.)
B-2
ANNEX C -- Form of Guarantee
[FORM OF GUARANTEE]
Each of the undersigned (the "Guarantors") hereby jointly and
severally unconditionally guarantees, to the extent set forth in the Indenture
dated as of March 23, 2004 by and between Norske Skog Canada Limited, as issuer,
the Guarantors and Wells Fargo Bank, National Association, as Trustee (as
amended, restated or supplemented from time to time, the "Indenture"), and
subject to the provisions of the Indenture, (a) the due and punctual payment of
the principal of, and premium, if any, and interest on the Notes, when and as
the same shall become due and payable, whether at maturity, by acceleration or
otherwise, the due and punctual payment of interest on overdue principal of, 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 set forth in Article Ten 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 and to the Trustee
pursuant to this Guarantee and the Indenture are expressly set forth in Article
Thirteen of the Indenture and reference is hereby made to the Indenture for the
precise terms and limitations of this Guarantee.
[Signatures on Following Pages]
C-l
IN WITNESS WHEREOF, each of the Guarantors has causes this Guarantee
to be signed by a duly authorized officer.
THE GUARANTORS:
ELK FALLS PULP AND PAPER LIMITED
By:
------------------------------------
Name:
Title:
NORSKE SKOG CANADA (JAPAN) LIMITED
By:
------------------------------------
Name:
Title:
NORSKE SKOG CANADA FINANCE LIMITED
By:
------------------------------------
Name:
Title:
NORSKE SKOG CANADA PULP OPERATIONS
LIMITED
By:
------------------------------------
Name:
Title:
NORSKE SKOG CANADA PULP SALES INC.
By:
------------------------------------
Name:
Title:
C-2
NORSKE SKOG CANADA SALES INC.
By:
------------------------------------
Name:
Title:
NORSKE SKOG CANADA SERVICES (HUNGARY)
LIMITED LIABILITY COMPANY
By:
------------------------------------
Name:
Title:
NORSKE SKOG CANADA (USA) INC.
By:
------------------------------------
Name:
Title:
NSCL HOLDINGS INC.
By:
------------------------------------
Name:
Title:
PACIFICA PAPERS SALES LTD.
By:
------------------------------------
Name:
Title:
PACIFICA PAPERS SALES INC.
By:
------------------------------------
Name:
Title:
C-3
PACIFICA POPLARS LTD.
By:
------------------------------------
Name:
Title:
PACIFICA POPLARS INC.
By:
------------------------------------
Name:
Title:
PACIFICA PAPERS US INC.
By:
------------------------------------
Name:
Title:
NORSKE CANADA
by its managing general partner,
Norske Skog Canada Limited
By:
------------------------------------
Name:
Title:
C-4