EXHIBIT 4.1
SERIES A AND SERIES B
13% SENIOR DISCOUNT NOTES DUE 2003
_________________
INDENTURE
Dated as of April 15, 1996
_________________
_________________
BANK OF MONTREAL TRUST COMPANY
_________________
Trustee
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CROSS-REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
310 (a)(1).................... 7.10
(a)(2).................... 7.10
(a)(3).................... N.A.
(a)(4).................... N.A.
(a)(5).................... 7.10
(b)....................... 7.10
(c)....................... N.A.
311 (a)....................... 7.11
(b)....................... 7.11
(c)....................... N.A.
312 (a)....................... 2.05
(b)....................... 10.03
(c)....................... 10.03
313 (a)....................... 7.06
(b)(1).................... N.A.
(b)(2).................... 7.06
(c)....................... 7.06;10.02
(d)....................... 7.06
314 (a)....................... 4.03;10.02
(b)....................... N.A.
(c)(1).................... 10.04
(c)(2).................... 10.04
(c)(3).................... N.A.
(d)....................... N.A.
(e)....................... 10.05
(f)....................... N.A.
315 (a)....................... 7.01
(b)....................... 7.05,10.02
(c)....................... 7.01
(d)....................... 7.01
(e)....................... 6.11
316 (a)(last sentence)........ 2.09
(a)(1)(A)................. 6.05
(a)(1)(B)................. 6.04
(a)(2).................... N.A.
(b)....................... 6.07
(c)....................... 2.12
317 (a)(1).................... 6.08
(a)(2).................... 6.09
(b)....................... 2.04
318 (a)....................... 10.01
(b)....................... N.A.
(c)....................... 10.01
N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.
TABLE OF CONTENTS
Page
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01. Definitions.............................................................. 1
Section 1.02. Other Definitions........................................................ 16
Section 1.03. Incorporation by Reference of Trust Indenture Act........................ 17
Section 1.04. Rules of Construction.................................................... 17
ARTICLE 2
THE SENIOR NOTES
Section 2.01. Form and Dating.......................................................... 18
Section 2.02. Execution and Authentication............................................. 18
Section 2.03. Registrar and Paying Agent............................................... 19
Section 2.04. Paying Agent to Hold Money in Trust...................................... 19
Section 2.05. Holder Lists............................................................. 19
Section 2.06. Transfer and Exchange.................................................... 20
Section 2.07. Replacement Senior Notes................................................. 25
Section 2.08. Outstanding Senior Notes................................................. 26
Section 2.09. Treasury Senior Notes.................................................... 26
Section 2.10. Temporary Senior Notes................................................... 26
Section 2.11. Cancellation............................................................. 26
Section 2.12. Record Date.............................................................. 27
Section 2.13. Defaulted Interest....................................................... 27
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee....................................................... 27
Section 3.02. Selection of Senior Notes to Be Redeemed................................. 27
Section 3.03. Notice of Redemption..................................................... 28
Section 3.04. Effect of Notice of Redemption........................................... 28
Section 3.05. Deposit of Redemption Price.............................................. 29
Section 3.06. Senior Notes Redeemed in Part............................................ 29
Section 3.07. Optional Redemption...................................................... 29
Section 3.08. Mandatory Redemption..................................................... 30
Section 3.09. Offer to Purchase by Application of Excess Proceeds...................... 30
ARTICLE 4
COVENANTS
Section 4.01. Payment of Senior Notes.................................................. 32
Section 4.02. Maintenance of Office or Agency.......................................... 32
Section 4.03. Reports.................................................................. 33
Section 4.04. Compliance Certificate................................................... 33
Section 4.05. Taxes.................................................................... 34
Section 4.06. Stay, Extension and Usury Laws........................................... 34
Section 4.07. Restricted Payments...................................................... 34
Section 4.08. Dividend and Other Payment Restrictions Affecting
Subsidiaries............................................................. 36
Section 4.09. Incurrence of Indebtedness and Issuance of Preferred
Stock.................................................................... 37
Section 4.10. Asset Sales.............................................................. 39
Section 4.11. Transactions with Affiliates............................................. 41
Section 4.12. Liens.................................................................... 41
Section 4.13. Line of Business......................................................... 42
Section 4.14. Corporate Existence...................................................... 42
Section 4.15. Offer to Purchase Upon Change of Control................................. 42
Section 4.16. Limitations on Sale and Leaseback Transactions........................... 43
Section 4.17. Loans to Subsidiaries and Joint Ventures................................. 43
Section 4.18. Limitation on Status as Investment Company............................... 44
Section 4.19. Payments for Consent..................................................... 44
Section 4.20. Independent Directors.................................................... 44
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Assets................................. 44
Section 5.02. Successor Corporation Substituted........................................ 45
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default........................................................ 45
Section 6.02. Acceleration............................................................. 47
Section 6.03. Other Remedies........................................................... 48
Section 6.04. Waiver of Past Defaults.................................................. 48
Section 6.05. Control by Majority...................................................... 48
Section 6.06. Limitation on Suits...................................................... 48
Section 6.07. Rights of Holders of Senior Notes to Receive Payment..................... 49
Section 6.08. Collection Suit by Trustee............................................... 49
Section 6.09. Trustee May File Proofs of Claim......................................... 49
Section 6.10. Priorities............................................................... 50
Section 6.11. Undertaking for Costs.................................................... 50
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee........................................................ 51
Section 7.02. Rights of Trustee........................................................ 52
Section 7.03. Individual Rights of Trustee............................................. 52
Section 7.04. Trustee's Disclaimer..................................................... 52
Section 7.05. Notice of Defaults....................................................... 53
Section 7.06. Reports by Trustee to Holders of the Senior Notes........................ 53
Section 7.07. Compensation and Indemnity............................................... 53
Section 7.08. Replacement of Trustee................................................... 54
Section 7.09. Successor Trustee by Merger, etc......................................... 55
Section 7.10. Eligibility; Disqualification............................................ 55
Section 7.11. Preferential Collection of Claims Against The
Company.................................................................. 55
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or Covenant
Defeasance............................................................... 55
Section 8.02. Legal Defeasance and Discharge........................................... 56
Section 8.03. Covenant Defeasance...................................................... 56
Section 8.04. Conditions to Legal or Covenant Defeasance............................... 56
Section 8.05. Deposited Money and Government Securities to be
Held in Trust; Other Miscellaneous Provisions............................ 58
Section 8.06. Repayment to The Company................................................. 58
Section 8.07. Reinstatement............................................................ 59
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of the Senior Notes........................... 59
Section 9.02. With Consent of Holders of Senior Notes.................................. 60
Section 9.03. Compliance with Trust Indenture Act...................................... 61
Section 9.04. Revocation and Effect of Consents........................................ 61
Section 9.05. Notation on or Exchange of Senior Notes.................................. 61
Section 9.06. Trustee to Sign Amendments, etc.......................................... 61
ARTICLE 10
MISCELLANEOUS
Section 10.01. Trust Indenture Act Controls............................................ 62
Section 10.02. Notices................................................................. 62
Section 10.03. Communication by Holders of Senior Notes with
Other Holders of Senior Notes........................................... 63
Section 10.04. Certificate and Opinion as to Conditions Precedent...................... 63
Section 10.05. Statements Required in Certificate or Opinion........................... 63
Section 10.06. Rules by Trustee and Agents............................................. 64
Section 10.07. No Personal Liability of Directors, Officers,
Employees and Stockholders.............................................. 64
Section 10.08. Governing Law........................................................... 64
Section 10.09. No Adverse Interpretation of Other Agreements........................... 64
Section 10.10. Successors.............................................................. 64
Section 10.11. Severability............................................................ 64
Section 10.12. Counterpart Originals................................................... 65
Section 10.13. Table of Contents, Headings, etc........................................ 65
EXHIBITS
Exhibit A FORM OF SENIOR NOTE
Exhibit B CERTIFICATE OF TRANSFEROR
ANNEXES
Annex A FORM OF INTERCOMPANY NOTE
SCHEDULES
Schedule A Fiber Lease Agreements
Schedule B Local Partners
Schedule C Local Partner Agreements
Schedule D Management Agreements
Schedule E Form of Financial Information and Operating Data
of the Subsidiaries and the Joint Ventures
Presented by Cluster
INDENTURE dated as of April 15, 1996 between HYPERION
TELECOMMUNICATIONS, INC., a Delaware corporation (the "Company") and BANK OF
MONTREAL TRUST COMPANY, as trustee (the "Trustee").
The Company and the Trustee agree as follows for the benefit of each
other and for the equal and ratable benefit of the holders (the "Holders") of
the 13% Series A Senior Discount Notes due 2003 (the "Series A Senior Notes")
and the 13% Series B Senior Discount Notes due 2003 (the "Series B Senior Notes"
and, together with the Series A Senior Notes, the "Senior Notes"):
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01. Definitions .
"Accreted Value" means, as of any date of determination prior to April
15, 2001, with respect to any Senior Note, the sum of (a) the initial offering
price (which shall be calculated by discounting the aggregate principal amount
at maturity of such Senior Note at a rate of 13% per annum, compounded semi-
annually on each April 15 and October 15 from April 15, 2001 to the date of
issuance) of such Senior Note and (b) the portion of the excess of the principal
amount of such Senior Note over such initial offering price which shall have
been accreted thereon through such date, such amount to be so accreted on a
daily basis at the rate of 13% per annum of the initial offering price of such
Senior Note, compounded semi-annually on each April 15 and October 15 from the
date of issuance of the Senior Notes through the date of determination, computed
on the basis of a 360-day year of twelve 30-day months.
"Acquired Indebtedness" means, with respect to any specified Person:
(i) Indebtedness of any other Person existing at the time such other Person
merged with or into or became a Subsidiary of such specified Person, including,
without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person and (ii) Indebtedness secured by a Lien
encumbering any asset acquired by such specified Person.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
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. For purposes of this
Indenture, beneficial ownership of 10% or more of the Voting Stock of a Person
shall be deemed to be control; provided, that no Local Partner will be deemed an
affiliate of a Subsidiary or a Joint Venture solely
as a result of such Local Partner's ownership of more than 10% of the Voting
Stock of such Subsidiary or Joint Venture.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Annualized Pro Forma EBITDA" means with respect to any Person, such
Person's Pro Forma EBITDA for the latest fiscal quarter for which internal
financial statements are then available multiplied by four.
"Asset Sale" means
(i) the sale, lease, conveyance, disposition or other transfer of
any assets (including, without limitation, by way of a Sale and
Leaseback Transaction) other than (a) sales of inventory in the
ordinary course of business consistent with past practices and (b)
issuances and sales by the Company of its Equity Interests (provided
that the sale, lease, conveyance, disposition or other transfer of all
or substantially all of the assets of the Company and its Subsidiaries
taken as a whole shall be governed by Sections 4.15 and 5.01 of the
Indenture), and
(ii) the issuance or sale by the Company or any of its
Subsidiaries of Equity Interests of any of the Company's Subsidiaries
or Joint Ventures, in the case of either clause (i) or (ii), whether
in a single transaction or a series of related transactions (a) that
have a fair market value in excess of $1.0 million or (b) for net
proceeds in excess of $1.0 million.
Notwithstanding the foregoing: (x) a transfer of assets by the Company to a
Wholly Owned Subsidiary or by a Subsidiary to the Company or to another Wholly
Owned Subsidiary, (y) an issuance of Equity Interests by a Subsidiary to the
Company or to a Wholly Owned Subsidiary and (z) a Restricted Payment that is
permitted by Section 4.07 will not be deemed to be Asset Sales.
"Attributable Debt" in respect of a Sale and Leaseback Transaction
means, at the time of determination, the present value (discounted at the rate
of interest implicit in such transaction, determined in accordance with GAAP) of
the obligation of the lessee for net rental payments during the remaining term
of the lease included in such sale and leaseback transaction (including any
period for which such lease has been extended or may, at the option of the
lessor, be extended).
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"Board of Directors" means the Board of Directors of the Company, or
any authorized committee of the Board of Directors.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital lease
that would at such time be required to be capitalized on a balance sheet in
accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate
stock, (ii) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership, partnership
interests (whether general or limited) and (iv) any other interest or
participation that confers on a Person the right to receive a share of the
profits and losses of, or distributions of assets of, the issuing Person.
"Cash Equivalents" means (i) United States dollars, (ii) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof having maturities of not
more that one year from the date of acquisition, (iii) certificates of deposit
and eurodollar time deposits with maturities of one year or less from the date
of acquisition, bankers' acceptances with maturities not exceeding one year and
overnight bank deposits, in each case with any domestic commercial bank having
capital and surplus in excess of $500,000,000 and a Keefe Bank Watch Rating of
"B" or better, (iv) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clauses (ii) and (iii)
above entered into with any financial institution meeting the qualifications
specified in clause (iii) above and (v) commercial paper having the highest
rating obtainable from either Moody's Investors Service, Inc. or Standard &
Poor's Corporation and, in each case, maturing within six months after the date
of acquisition.
"Change of Control" means the occurrence of any of the following: (i)
the sale, lease, transfer, conveyance or other disposition (other than by way of
merger or consolidation), in one or a series of related transactions, of all or
substantially all of the assets of the Company and its Subsidiaries taken as a
whole to any "person" (as such term is used in Section 13(d)(3) of the Exchange
Act) other than the Principals or their Affiliates, (ii) the adoption of a plan
relating to the liquidation or dissolution of the Company, (iii) the
consummation of any transaction (including, without limitation, any merger or
consolidation) the result of which is that any "person", other than the
Principals and their Affiliates, becomes the "beneficial owner" (as such term is
defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act), directly or
indirectly, of more than 50% of the voting power of the Capital Stock of the
Company, (iv) the consummation of the first transaction (including, without
limitation, any merger or consolidation) the result of which is that any
"person" becomes the "beneficial owner," directly or indirectly, of more of the
voting power of the Capital Stock of the Company than is at the time
"beneficially owned" by the Principals and their Affiliates in the aggregate or
(v) the first day on which a majority of the members of the Board of Directors
of the Company are not Continuing Directors. For purposes of this definition,
any transfer of an Equity Interest of an entity that was formed for the purpose
of acquiring voting power of Capital Stock of the Company shall be deemed to be
a transfer of such portion of such voting power of Capital Stock as corresponds
to the portion of the equity of such entity that has been so transferred.
"Consolidated Interest Expense" means, for any Person, for any period,
the aggregate of the following for such Person for such period determined on a
consolidated basis in accordance with GAAP: (a) the amount of interest in
respect of Indebtedness (including amortization of original issue discount,
amortization of debt issuance costs and non-cash interest payments on any
Indebtedness and the interest portion of any deferred payment obligation) and
(b) the interest component of rentals in respect of any Capital Lease Obligation
paid, in each case whether accrued or scheduled to be paid or accrued by such
Person during such period to the extent such amounts were deducted in computing
Consolidated Net Income, determined on a consolidated basis in accordance with
GAAP. For purposes of this definition, interest on a Capital Lease Obligation
shall be deemed to accrue at an interest rate reasonably determined by such
Person to be the rate of interest implicit in such Capital Lease Obligation in
accordance with GAAP consistently applied.
"Company" means Hyperion Telecommunications, Inc. a Delaware
corporation.
"Consolidated Leverage Ratio" means, for any Person, as of any date,
the ratio of (i) the sum of the aggregate outstanding amount of all Indebtedness
of a Person and its Subsidiaries (other than any Indebtedness of a General
Partner Subsidiary to the extent that such Indebtedness has been incurred in
connection with such General Partner Subsidiary's partnership interest in the
Restricted Joint Venture of which such General Partner Subsidiary is a general
partner) determined on a consolidated basis in accordance with GAAP to (ii)
Annualized Pro Forma EBITDA.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its Subsidiaries for
such period, on a consolidated basis, determined in accordance with GAAP;
provided that (i) the Net Income (but not loss) of any Person that is not a
Subsidiary or that is accounted for by the equity method of accounting shall be
included only to the extent of the amount of dividends or distributions actually
paid in cash to the referent Person or a Wholly Owned Subsidiary thereof, (ii)
the Net Income of any Subsidiary shall be excluded to the extent that the
declaration or payment of dividends or similar distributions by that Subsidiary
of that Net Income is not at the date of determination permitted without any
prior governmental approval (that has not been obtained) or, directly or
indirectly, by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to that Subsidiary or its stockholders, (iii) 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 (iv) the cumulative effect of
a change in accounting principles shall be excluded.
"Consolidated Net Worth" means, with respect to any Person as of any
date, the sum of (i) the consolidated equity of the common stockholders of such
Person and its consolidated Subsidiaries as of such date plus (ii) the
respective amounts reported on such Person's balance sheet as of such date with
respect to any series of preferred stock (other than Disqualified Stock) that by
its terms is not entitled to the payment of dividends unless such dividends may
be declared and paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash received by such
Person upon issuance of such preferred stock, less (x) all write-ups (other than
write-ups resulting from foreign currency translations and write-
ups of tangible assets of a going concern business made within 12 months after
the acquisition of such business) subsequent to the date of the Indenture in the
book value of any asset owned by such Person or a consolidated Subsidiary of
such Person, (y) all investments as of such date in unconsolidated Subsidiaries
and in Persons that are not Subsidiaries (except, in each case, Permitted
Investments) and (z) all unamortized debt discount and expense and unamortized
deferred charges as of such date, all of the foregoing determined in accordance
with GAAP.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company who (i) was a member of such
Board of Directors on the date of this Indenture or (ii) was nominated for
election or elected to such Board of Directors with the approval of a majority
of the Continuing Directors who were members of such Board at the time of such
nomination or election.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 10.02 hereof or such other address as to which the
Trustee may give notice to the Company.
"Credit Agreement" means, with respect to any Person, any agreement
entered into by and among such Person and one or more commercial banks or
financial institutions, providing for senior term or revolving credit borrowings
of a type similar to credit agreements typically entered into by commercial
banks and financial institutions, including any related notes, Guarantees,
collateral documents, instruments and agreements executed in connection
therewith, as such credit agreement and related agreements may be amended,
extended, refinanced, renewed, restated, replaced or refunded from time to time.
"Cumulative Pro Forma EBITDA" means the cumulative EBITDA of the
Company from and after the first day of the first fiscal quarter beginning after
the date of the Indenture to the end of the fiscal quarter immediately preceding
the date of a proposed Restricted Payment, or, if such cumulative EBITDA for
such period is negative, minus the amount by which such cumulative EBITDA is
less than zero.
"Cumulative Interest Expense" means the aggregate amount of
Consolidated Interest Expense of the Company paid or accrued by the Company from
and after the first day of the first fiscal quarter beginning after the date of
the Indenture to the end of the fiscal quarter immediately preceding a proposed
Restricted Payment, determined on a consolidated basis in accordance with GAAP.
"Default" means any event that is or with the passage of time or the
giving of notice or both would be an Event of Default.
"Definitive Senior Notes" means Senior Notes that are in the form of
the Senior Notes attached hereto as Exhibit A, that do not include the
information called for by footnotes 1 and 2 thereof.
"Depository" means, with respect to the Senior Notes issuable or
issued in whole or in part in global form, the Person specified in Section 2.03
hereof as the Depository with respect to the Senior Notes, until a successor
shall have been
appointed and become such pursuant to the applicable provision of this
Indenture, and, thereafter, "Depository" shall mean or include such successor.
"Disqualified Stock" means any Capital Stock which, by its terms (or
by the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the holder thereof, in whole or in part, on or prior to the date
that is 91 days after the date on which the Senior Notes mature.
"EBITDA" means, for any Person, for any period, an amount equal to (A)
the sum of (i) Consolidated Net Income for such period plus (ii) 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 and any provision
for taxes utilized in computing net loss under clause (i) hereof plus (iii)
Consolidated Interest Expense for such period, plus (iv) depreciation for such
period on a consolidated basis plus (v) amortization of intangibles for such
period on a consolidated basis, plus (vi) any other non-cash items reducing
Consolidated Net Income for such period minus (B) all non-cash items increasing
Consolidated Net Income for such period, all for each such Person and its
Subsidiaries determined in accordance with GAAP consistently applied.
"Enhanced Services Venture" means any entity in which any Qualified
Subsidiary or Permitted Joint Venture owns at least 50% of the Equity Interests,
provided that the remainder of the Equity Interests are owned by an Enhanced
Services Provider.
"Enhanced Services Provider" means (i) !NTERPRISE, a wholly owned
subsidiary of US West, (ii) any nationally recognized Person which provides
enhanced telecommunications services, including but not limited to, frame relay,
Asynchronous Transfer Mode data transport, business video conferencing, private
line data interconnect service and LAN connection and monitoring services, or
(iii) any Person that has least 500 existing enhanced data services
installations in the United States.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Offer" means the offer that may be made by the Company
pursuant to the Registration Rights Agreement to exchange Series A Senior Notes
for Series B Senior Notes.
"Existing Indebtedness" means the Senior Notes and any other
Indebtedness of the Company and its Subsidiaries in existence on the date
hereof.
"Existing Networks" means the telecommunications networks operated by
the Company, its Subsidiaries and Joint Ventures, including, but not limited to,
all networks under construction, on the date hereof.
"Fiber Lease Agreements" means the agreements relating to fiber leases
as set forth on Schedule A hereto.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the date of this Indenture.
"General Partner Subsidiary" means a direct or indirect Wholly Owned
Subsidiary of the Company that (i) is a general partner or stockholder of a
Restricted Joint Venture and (ii) (a) is not engaged in any trade or business
other than the holding, voting, disposing of or taking any action with respect
to its Equity Interest in such Restricted Joint Venture, (b) has no material
assets other than its Equity Interest in such Restricted Joint Venture, (c) has
no material liabilities other than liabilities arising (1) as a result of the
guarantee by such General Partner Subsidiary of Indebtedness incurred by the
Restricted Joint Venture of which such General Partner Subsidiary is a general
partner or (2) by operation of law; provided that, for purposes of this
definition, Hyperion Telecommunications of Virginia, Inc. and Hyperion
Telecommunications of New York, Inc. shall be deemed to be General Partner
Subsidiaries for all purposes so long as Hyperion Telecommunications of
Virginia, Inc. and Hyperion Telecommunications of New York, Inc. do not engage
in any operations or business that is materially different from the operations
or business engaged in by such companies on the date hereof.
"Global Note" means a Senior Note that contains the paragraph referred
to in footnote 1 and the additional schedule referred to in footnote 2 to the
form of the Senior Note attached hereto as Exhibit A.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America for the payment of which guarantee
or obligations the full faith and credit of the United States is pledged.
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.
"Holder" means a Person in whose name a Senior Note is registered.
"Indebtedness" means, with respect to any Person, (a) any liability of
any Person, whether or not contingent (i) for borrowed money, or under any
reimbursement obligation relating to a letter of credit, bankers' acceptance or
note purchase facility; or (ii) evidenced by a bond, note, debenture or similar
instrument
(including a purchase money obligation); or (iii) for the payment of money
relating to a lease that is required to be classified as a Capitalized Lease
Obligation in accordance with GAAP; (iv) for Disqualified Stock; or (v) for
preferred stock of any Subsidiary (other than preferred stock held by the
Company or any of its Subsidiaries); (b) any liability of others described in
the preceding clause (a) that the Person has guaranteed, that is recourse to
such Person or that is otherwise its legal liability; and (c) any amendment,
supplement, modification, deferral, renewal, extension or refunding of any
liability of the types referred to in clauses (a) and (b) above.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Initial Public Offering" means an initial underwritten public
offering of common stock of the Company pursuant to an effective registration
statement under the Securities Act of 1933, as amended.
"Intercompany Notes" means the intercompany notes issued by
Subsidiaries and Joint Ventures of the Company in favor of the Company or its
Subsidiaries to evidence loans by the Company to such Subsidiary or Joint
Venture, in each case, in the form attached as Annex 1 hereto.
"Invested Equity Capital" means, with respect to any Company's
Subsidiaries or Joint Ventures as of any date, the sum of (i) the total dollar
amount contributed in cash plus the value of all property contributed (valued at
the lower of fair market value of such property at the time of contribution,
determined in good faith by the Company's Board of Directors, or the book value
of such property at the time of contribution on the books of the Person making
such contribution) to such Subsidiary or Joint Venture, as the case may be,
since the date of its formation in the form of common equity plus, without
duplication, (ii) the total dollar amount contributed in cash plus the value of
all property contributed (valued at the lower of fair market value of such
property at the time of contribution, determined in good faith by the Company's
Board of Directors, or the book value of such property at the time of
contribution on the books of the Person making such contribution) to such
Subsidiary or Joint Venture, as the case may be, since the date of its formation
by Local Partners (and their Affiliates) in consideration of the issuance of
preferred equity on a basis that is substantially proportionate to their common
equity interests plus, without duplication, (iii) the total dollar amount
contributed in cash plus the value of all property contributed (valued at the
lower of fair market value of such property at the time of contribution,
determined in good faith by the Company's Board of Directors, or the book value
of such property at the time of contribution on the books of the Person making
such contribution) to such Subsidiary or Joint Venture since the date of its
formation by the Company in consideration of the issuance of preferred equity
less (iv) the fair market value of all dividends and other distributions (in
respect of any Equity Interest and in whatever form and however designated) made
by such Subsidiary or Joint Venture, as the case may be, since the date of its
formation to the holders of its common equity (and their Affiliates); provided
that in no event shall the aggregate amount of such dividends and other
distributions made by such Subsidiary or Joint Venture, as the case may be, to
any such Person (or its Affiliates) reduce the Invested Equity Capital of such
Subsidiary or Joint Venture, as the case may be, by more than
the total contributions (per clauses (i) through (iii) above) to such Subsidiary
or Joint Venture, as the case may be, by such Person (and its Affiliates).
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including guarantees of Indebtedness or other obligations),
advances (excluding commission, travel and similar advances to officers and
employees made in the ordinary course of business), capital contributions,
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together with all items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP;
provided that an acquisition of assets, Equity Interests or other securities by
the Company for consideration consisting solely of common equity securities of
the Company shall not be deemed to be an Investment. If the Company or any
Subsidiary of the Company sells or otherwise disposes of any Equity Interests of
any direct or indirect Subsidiary of the Company such that, after giving effect
to any such sale or disposition, such Person is no longer a Subsidiary of the
Company, the Company shall be deemed to have made an Investment on the date of
any such sale or disposition equal to the fair market value of the Equity
Interests of such Subsidiary not sold or disposed of.
"Joint Venture" means a corporation, partnership or other entity
engaged in one or more Telecommunications Businesses (i) in which the Company or
its Subsidiaries owns, directly or indirectly, an Equity Interest with the
balance of the Equity Interest thereof being held by one or more Local Partners
and (ii) that is managed and operated by the Company or any of its Subsidiaries.
"Joint Venture Investment" means any Investment in a Joint Venture.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue
for the intervening period.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction).
"Liquidated Damages" means all liquidated damages then owing pursuant
to Section 5 of the Registration Rights Agreement.
"Local Partner" means, with respect to any Joint Venture (i) the Joint
Venture partners set forth on Schedule B hereto, and (ii) any other Person,
provided that such other Person (a) is a major cable company or utility that has
a substantial presence within the specific market of such Joint Venture, which
presence shall be
evidenced, in the case of a cable company, by such company having a market share
consisting of at least 50% of the total number of cable subscribers in such
market and in the case of a utility company, by such company having at least 75%
of the total customer base of such market or (b) is a Wholly Owned Subsidiary of
a major cable company or utility that (1) meets the criteria set forth in the
immediately preceding clause (a) or (2) has all of its initial capital
contributions under the agreement governing the Joint Venture fully and
unconditionally guaranteed, until such time as all such contributions have been
made, by one or more Persons who meet the criteria set forth in the immediately
preceding clause (a).
"Local Partner Agreements" means the joint venture agreements with
Local Partners, as set forth on Schedule C hereto.
"Management Agreements" means the agreements governing the management
of the networks, as set forth on Schedule D hereto.
"Net Cash Proceeds" means the aggregate cash proceeds received by the
Company or any of its Subsidiaries in respect of any Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of any
non-cash consideration received in any Asset Sale and principal payments on
debt, as and when received), net of the direct costs relating to such Asset Sale
(including, without limitation, legal, accounting and investment banking fees,
and sales commissions) and any relocation expenses incurred as a result thereof,
taxes paid or payable as a result thereof (after taking into account any
available tax credits or deductions and any tax sharing arrangements) and any
reserve for adjustment in respect of the sale price of such asset or assets
established in accordance with GAAP.
"Net Income" means, with respect to any Person, the net income (loss)
of such Person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends, excluding, however, (i) any gain or loss,
together with any related provision for taxes on such gain or loss, realized in
connection with (a) any Asset Sale (including, without limitation, dispositions
pursuant to Sale and Leaseback Transactions), or (b) the disposition of any
securities by such Person or any of its Subsidiaries or the extinguishment of
any Indebtedness of such Person or any of its Subsidiaries, and (ii) any
extraordinary gain or loss, together with any related provision for taxes on
such extraordinary gain or loss.
"New Telecommunications Service Market" means a Telecommunications
Service Market in an area that is not within ten miles of any of the Company's
Existing Networks.
"Non-Recourse Debt" means Indebtedness: (i) as to which neither the
Company nor any of its Subsidiaries nor any of its Permitted Joint Ventures (a)
provides credit support of any kind (including any undertaking, agreement or
instrument that would constitute Indebtedness), (b) is directly or indirectly
liable (as a guarantor, co-obligor or otherwise) or (c) constitutes the lender;
(ii) as to which no default with respect to which (including any rights that the
holders thereof may have to take enforcement action against a Restricted Joint
Venture) would permit (upon notice, lapse of time, the occurrence or failure to
occur, of any other condition or event or any
combination thereof) any holder of any other Indebtedness of the Company, any of
its Subsidiaries or any of its Permitted Joint Ventures to declare a default on
such other Indebtedness or cause or permit the payment thereof to be accelerated
prior to its stated maturity; and (iii) as to which the lenders have been
notified in writing that they will not have any recourse to the stock or assets
of the Company, any of its Subsidiaries or any of its Permitted Joint Ventures;
provided that the recourse (if any) of a holder of such Indebtedness to the
General Partner Subsidiary of a Restricted Joint Venture in which such General
Partner Subsidiary is a general partner as a result of being a general partner
of such Restricted Joint Venture will not be considered credit support or direct
or indirect liability of such General Partner Subsidiary for purposes of clauses
(i)(a), (ii)(b) and (iii) above.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the
Controller, the Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the principal
executive officer, the principal financial officer, the treasurer or the
principal accounting officer of the Company, that meets the requirements of
Section 10.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
10.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.
"Permitted Investments" means
(a) ..........................................................
any Investment in a Wholly Owned Subsidiary of the Company
that is engaged, either directly or indirectly through a
Qualified Subsidiary or Joint Venture, in the Telecommunications
Business;
(b) ..........................................................
any Investment in a Qualified Subsidiary of the Company that is
directly engaged in the Telecommunications Business;
(c) ..........................................................
any Investment in Cash Equivalents;
(d) ..........................................................
any Investment in a Person that is not a Subsidiary of the
Company, if as a result of such Investment (i)(A) such Person
becomes a Qualified
Subsidiary or Wholly Owned Subsidiary of the Company or (B) such
Person is merged, consolidated or amalgamated with or into, or
transfers or conveys substantially all of its assets to, or is
liquidated into, the Company or a Qualified Subsidiary and
(ii)(A) such Wholly Owned Subsidiary, either directly or
indirectly through a Qualified Subsidiary or a Joint Venture, is
engaged in the Telecommunications Business or (B) such Qualified
Subsidiary is directly engaged in the Telecommunications
Business;
(e) ..........................................................
any Permitted Joint Venture Investment;
(f) ..........................................................
any Investment made as a result of the receipt of non-cash
consideration (whether or not such non-cash consideration is
deemed to be cash for the purposes of Section 4.10) from an Asset
Sale that was made pursuant to and in compliance with Section
4.10 hereof; or
(g) ..........................................................
any Investment in an Enhanced Services Venture.
"Permitted Joint Venture" means any Joint Venture in which the Company
has, directly or indirectly, a 45% or greater Equity Interest.
"Permitted Joint Venture Investment" means any Joint Venture
Investment by the Company or a Wholly Owned Subsidiary of the Company if, after
such Joint Venture Investment, the Company has, directly or indirectly, a 45% or
greater Equity Interest in such Joint Venture.
"Permitted Liens" means
(i) Liens on the property of the Company, any Subsidiary or any
Permitted Joint Venture securing Obligations under Indebtedness
that may be incurred pursuant to clause (i) of Section 4.09
hereof;
(ii) Liens in favor of the Company;
(iii) Liens on property of a Person existing at the time such
Person is merged into or consolidated with the Company, any
Subsidiary or any Permitted Joint Venture; provided that such
Liens were in existence prior to the contemplation of such merger
or consolidation and do not extend to any assets other than those
of the Person merged into or consolidated with the Company;
(iv) Liens on property existing at the time of acquisition
thereof by the Company, any Subsidiary or any Permitted Joint
Venture, provided that such Liens were in existence prior to the
contemplation of such acquisition;
(v) Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds or other obligations of
a like nature incurred in the ordinary course of business;
(vi) Liens existing on the date of this Indenture;
(vii) Liens on property of Subsidiaries and Permitted
Joint Ventures securing Obligations under Indebtedness incurred
pursuant to clause (viii) of Section 4.09 hereof but only to the
extent that (a) in the case of Subsidiaries and Permitted Joint
Ventures that are incurring Indebtedness other than Related
Network Debt, such Liens secure only such Indebtedness incurred
by such Subsidiary or such Joint Venture; and (b) in the case of
Subsidiaries and Joint Ventures that are incurring Related
Network Debt, such Liens secure only such Related Network Debt;
(viii) Liens securing Obligations under the Senior Notes and
this Indenture;
(ix) Liens securing Obligations under Vendor Debt pursuant to
clause (ii) of Section 4.09 hereof; provided that the principal
amount of such Vendor Debt secured by such Lien does not exceed
100% of the purchase price or cost of acquisition, construction
or improvement of the Telecommunications Related Assets subject
to such Liens;
(x) Liens for taxes, assessments or governmental charges or
claims that are not yet delinquent or that are being contested in
good faith by appropriate proceedings promptly instituted and
diligently concluded, provided that any reserve or other
appropriate provision as shall be required in conformity with
GAAP shall have been made therefor;
(xi) Liens incurred in the ordinary course of business
of the Company, any Subsidiary or any Permitted Joint Venture
with respect to obligations that do not exceed $5.0 million 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, such
Subsidiary or such Permitted Joint Venture; or
(xii) Liens securing Refinancing Indebtedness, but only
if, and to the extent, that such Liens that are incurred in
connection with such Refinancing Indebtedness are at least as
favorable to the Holders of Senior Notes as those contained in
the documentation governing the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
government or agency or political subdivision thereof (including any subdivision
or ongoing business of any such entity or substantially all of the assets of any
such entity, subdivision or business).
"Preferred Stock" for any Person means Capital Stock of such Person
of any class or classes (however designated) that ranks prior, as to the payment
of dividends or as to the distribution of assets upon any voluntary or
involuntary liquidation, dissolution or winding up of such Person, to shares of
Capital Stock of any other class of such Person.
"Principals" means John J. Rigas and members of his immediate family,
any of their respective spouses, estates, lineal descendants, heirs, executors,
personal representatives, administrators, trusts for any of their benefit and
charitable foundations to which shares of the Company's Capital Stock
beneficially owned by any of the foregoing have been transferred.
"Pro Forma EBITDA" means, for any Person, for any period, the EBITDA
of such Person as determined on a consolidated basis in accordance with GAAP
consistently applied, after giving effect to the following: (i) if, during or
after such period, such Person or any of its Subsidiaries shall have made any
Asset Sale, Pro Forma EBITDA for such Person and its Subsidiaries for such
period shall be reduced by an amount equal to the Pro Forma EBITDA (if positive)
directly attributable to the assets which are the subject of such Asset Sale for
the period or increased by an amount equal to the Pro Forma EBITDA (if negative)
directly attributable thereto for such period and (ii) if, during or after such
period, such Person or any of its Subsidiaries completes an acquisition of any
Person or business which immediately after such acquisition is a Subsidiary of
such Person or a Subsidiary of such Person, Pro Forma EBITDA shall be computed
so as to give pro forma effect to such Asset Sale or the acquisition of such
Person or business, as the case maybe.
"Qualified Subsidiary" means any Subsidiary in which a Local Partner
or Local Partners own at least 5% but less than 50% of the Equity Interests of
such Subsidiary; provided that such Subsidiary remains a Subsidiary of the
Company at all times for purposes of this Indenture.
"Refinancing Indebtedness" means any Indebtedness of the Company, any
of its Subsidiaries or any of its Permitted Joint Ventures issued in exchange
for, or the net proceeds of which are used to extend, refinance, renew, replace,
defease or refund other Indebtedness of the Company, any of its Subsidiaries or
any of its Permitted Joint Ventures; provided that: (i) the principal amount
(or accreted value, if applicable) of such Refinancing Indebtedness does not
exceed the principal amount (or accreted value, if applicable) of the
Indebtedness so extended, refinanced, renewed, replaced, defeased or refunded
(plus the amount of reasonable expenses incurred in connection therewith); (ii)
such Refinancing Indebtedness has a final maturity date later than the final
maturity date of, and has a Weighted Average Life to Maturity equal to or
greater than the Weighted Average Life to Maturity of, the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; (iii) if the
Indebtedness
being extended, refinanced, renewed, replaced, defeased or refunded is
subordinated in right of payment to the Senior Notes, such Refinancing
Indebtedness has a final maturity date later than the final maturity date of the
Senior Notes, and is subordinated in right of payment to the Senior Notes on
terms at least as favorable to the Holders of Senior Notes as those contained in
the documentation governing the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded; (iv) to the extent that the
Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded
was secured by Liens, any Liens being incurred in connection with such
Refinancing Indebtedness are at least as favorable to the Holders of Senior
Notes as those contained in the documentation governing the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; and (v) such
Indebtedness is incurred either by the Company, the Subsidiary or the Permitted
Joint Venture who is the obligor on the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of April 15, 1996, by and among the Company and the other
parties named on the signature pages thereof, as such agreement may be amended,
modified or supplemented from time to time.
"Related Networks" means any group of Qualified Subsidiaries or
Permitted Joint Ventures in which the same Local Partner owns, or the same group
of Local Partners own, all the Equity Interests of each such Qualified
Subsidiary or Permitted Joint Venture that comprise such Related Network that
are not owned by the Company.
"Related Network Debt" means any Credit Agreement entered into by and
among the Qualified Subsidiaries and/or Permitted Joint Ventures that comprise a
Related Network.
"Required Capital Contribution" means any capital contribution made by
Hyperion Telecommunications Inc. of Florida, pursuant to that certain
partnership agreement relating to TCG South Florida, dated November 1, 1993.
"Responsible Officer," when used with respect to the Trustee, means
any officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers 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 Investment" means any Investment other than a Permitted
Investment.
"Restricted Joint Venture" means any Joint Venture that is not a
Permitted Joint Venture, but only if such Joint Venture: (a) has no Indebtedness
other than Non-Recourse Debt; (b) is not a party to any agreement, contract,
arrangement or understanding with the Company, any of its Subsidiaries or any of
its Permitted Joint Ventures unless the terms of any such agreement, contract,
arrangement or
understanding are no less favorable to the Company, such Subsidiary or such
Permitted Joint Venture than those that might be obtained at the time from
Persons who are not Affiliates of the Company; and (c) has not guaranteed or
otherwise directly or indirectly provided credit support for any Indebtedness of
the Company, any of its Subsidiaries or any of its Permitted Joint Ventures. If,
at any time, a Restricted Joint Venture would fail to meet the requirements of a
Restricted Joint Venture by becoming a Permitted Joint Venture or otherwise, it
shall thereafter cease to be a Restricted Joint Venture for purposes of this
Indenture and (i) all of the then outstanding Indebtedness of such entity shall
be deemed to be incurred as of the date on which such entity becomes a Permitted
Joint Venture or otherwise ceases to be a Restricted Joint Venture for purposes
of Section 4.09 hereof subject to the provisions of Section 6.01(d) hereof(and
if such Indebtedness is not permitted to be incurred as of such date, the
Company shall be in default of such covenant) and (ii) all of the then
outstanding Investments made by such entity since the date of this Indenture
shall be deemed to have been made as of the date that such Restricted Joint
Venture becomes a Permitted Joint Venture or otherwise ceases to be a Restricted
Joint Venture for purposes of Section 4.07 hereof (and if such Investments are
not permitted to be made as of such date under Section 4.07 hereof, the Company
shall be in default of such covenant); provided that if a Restricted Joint
Venture ceases to be a Restricted Joint Venture as a result of (i) the loss of
its Local Partner or (ii) the loss of management control of such Restricted
Joint Venture, then the provisions of Section 4.07 shall not be applied to such
entity.
"Restricted Joint Venture Investment" means any Joint Venture
Investment by a General Partner Subsidiary if, after such Joint Venture
Investment, such Joint Venture is a Restricted Joint Venture.
"Sale and Leaseback Transaction" of any Person means an arrangement
with any lender or investor or to which such lender or investor is a party
providing for the leasing by such Person of any property or asset of such Person
which has been or is being sold or transferred by such Person more than 365 days
after the acquisition thereof or the completion of construction or commencement
of operation thereof to such lender or investor or to any Person to whom funds
have been or are to be advanced by lender or investor on the security of such
property or asset. The stated maturity of such arrangement shall be the date of
the last payment of rent or any other amount due under such arrangement prior to
the first date on which such arrangement may be terminated by the lessee without
payment of a penalty.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Note Custodian" means the Trustee, as custodian with respect
to the Senior Notes in global form, or any successor entity thereto.
"Senior Notes" means the Company's 13% Series A Senior Discount Notes
due 2003 issued pursuant to this Indenture and 13% Series B Senior Discount
Notes due 2003 issued in exchange for 13% Series A Senior Discount Notes.
"Separation Date" means, with respect to the date on which the Senior
Notes and the Warrants shall become separable, the earlier of (i) 90 days from
the date of issuance, (ii) such date as the Initial Purchasers may, in their
discretion, deem appropriate, (iii) in the event a Change of Control occurs, the
date the Company mails notice thereof to holders of the Senior Notes and (iv)
the date on which the Exchange Offer is consummated.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date of this Indenture.
"Stated Maturity" means with respect to any debt security, the date
specified in such debt security as the fixed date on which the final installment
of principal of such debt security is due and payable.
"Strategic Investor" means a corporation, partnership or other entity
engaged in one or more Telecommunications Businesses that has, or 80% or more of
the voting power of the Capital Stock of which is owned by a Person that has, an
equity market capitalization, at the time (i) of its initial Investment in the
Company or (ii) it purchases an Equity Interest in a Subsidiary or Joint Venture
of the Company, as the case may be, in excess of $2.0 billion.
"Subsidiary" means, with respect to any Person, (i) any corporation,
association or other business entity (other than a partnership) of which more
than 50% of the total voting power of shares of Capital Stock entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by such Person or one or more of the other Subsidiaries
of that Person (or a combination thereof) and (ii) any partnership of which more
than 50% of the partnership's capital accounts, distribution rights or general
or limited partnership interests are owned or controlled, directly or
indirectly, by such Person or one or more of the other Subsidiaries of that
Person or a combination thereof.
"Telecommunications Business" means the business of (i) transmitting,
or providing services relating to the transmission of, voice, video or data
through owned or leased transmission facilities, (ii) creating, developing or
marketing communications related network equipment, software and other devices
for use in a telecommunications business or (iii) evaluating, participating or
pursuing any other activity or opportunity that is primarily related to those
identified in (i) or (ii) above; provided that the determination of what
constitutes a Telecommunications Business shall be made in good faith by the
Board of Directors of the Company.
"Telecommunications Related Assets" means all assets, rights
(contractual or otherwise) and properties, whether tangible or intangible, used
or intended for use in connection with a Telecommunications Business.
"Telecommunications Service Market" means a network built by the
Company to service a market.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. (S)(S) 77aaa-
77bbbb) as in effect on the date on which this Indenture is qualified under the
TIA.
"Transfer Restricted Securities" means securities that bear or are
required to bear the legend set forth in Section 2.06 hereof.
"Trustee" means the party named as such above until a successor
replaces it in accordance with the applicable provisions of this Indenture and
thereafter means the successor serving hereunder.
"Vendor Debt" means any purchase money Indebtedness of the Company or
any Subsidiary incurred in connection with the acquisition of Telecommunications
Related Assets and which purchase money Indebtedness was extended by the vendor
of such Telecommunications Related Assets or an affiliate thereof.
"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 voting power by reason of any contingency.
"Warrant" means any Warrant (as defined in the Warrant Agreement) from
time to time outstanding pursuant to the Warrant Agreement.
"Warrant Agreement" means the warrant agreement, dated as of April 15,
1996, between the Company and Bank of Montreal Trust Company, as Warrant Agent.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a) the sum
of the products obtained by multiplying (x) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (y) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (b) the then outstanding principal
amount of such Indebtedness.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of such
Person all of the outstanding Capital Stock or other ownership interests of
which (other than directors' qualifying shares) shall at the time be owned by
such Person or by one or more Wholly Owned Subsidiaries of such Person or by
such Person and one or more Wholly Owned Subsidiaries of such Person.
Section 1.02. Other Definitions.
Defined in
Term Section
"Affiliate Transaction"........... 4.11
"Asset Sale"...................... 4.10
"Asset Sale Offer"................ 3.09
"Bankruptcy Law".................. 4.01
"Change of Control Offer"......... 4.15
"Change of Control Payment"....... 4.15
"Change of Control Payment Date".. 4.15
"Covenant Defeasance"............. 8.03
"Custodian"....................... 4.13
"Event of Default"................ 6.01
"Excess Proceeds"................. 4.10
"incur"........................... 4.09
"Legal Defeasance"................ 8.02
"Offer Amount".................... 3.09
"Offer Period".................... 3.09
"Paying Agent".................... 2.03
"Purchase Date"................... 3.09
"Registrar"....................... 2.03
"Restricted Payments"............. 4.07
Section 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Senior Notes;
"indenture security Holder" means a Holder of a Senior Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee;
"obligor" on the Senior Notes means the Company and any successor obligor
upon the Senior Notes.
All other terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by SEC rule under the TIA have
the meanings so assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned to
it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural include
the singular;
(5) provisions apply to successive events and transactions; and
(6) references to sections of or rules under the Securities Act shall be
deemed to include substitute, replacement of successor sections or rules
adopted by the SEC from time to time.
ARTICLE 2
THE SENIOR NOTES
Section 2.01. Form and Dating.
The Senior Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A hereto. The Senior Notes may have
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notations, legends or endorsements required by law, stock exchange rule or
usage. Each Senior Note shall be dated the date of its authentication. The
Senior Notes shall be in denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Senior Notes shall constitute, and
are hereby expressly made, a part of this Indenture and the Company and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby.
Senior Notes issued in global form shall be substantially in the form of
Exhibit A attached hereto (including the text referred to in footnotes 1 and 2
thereto). Senior Notes issued in the form of registered definitive certificates
shall be substantially in the form of Exhibit A attached hereto (but without
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including the text referred to in footnotes 1 and 2 thereto). Each Global Note
shall represent such of the outstanding Senior Notes as shall be specified
therein and each shall provide that it shall represent the aggregate amount of
outstanding Senior Notes from time to time endorsed thereon and that the
aggregate amount of outstanding Senior Notes represented thereby may from time
to time be reduced or increased, as appropriate, to reflect exchanges and
redemptions. Any endorsement of a Global Note to reflect the amount of any
increase or decrease in the amount of outstanding Senior Notes represented
thereby shall be made by the Trustee or the Senior Note Custodian, at the
direction of the Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06 hereof.
Section 2.02. Execution and Authentication.
Two Officers shall sign the Senior Notes for the Company by manual or
facsimile signature. The Company's seal shall be reproduced on the Senior Notes
and may be in facsimile form.
If an Officer whose signature is on a Senior Note no longer holds that
office at the time a Senior Note is authenticated, the Senior Note shall
nevertheless be valid.
A Senior Note shall not be valid until authenticated by the manual signature
of the Trustee. The signature shall be conclusive evidence that the Senior Note
has been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed by two
Officers, authenticate Senior Notes for original issue up to the aggregate
principal amount stated in paragraph 4 of the Senior Notes. The aggregate
principal amount of Senior Notes outstanding at any time may not exceed such
amount except as provided in Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to the Company to
authenticate Senior Notes. An authenticating agent may authenticate Senior
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 or
an Affiliate of the Company.
Section 2.03. Registrar and Paying Agent.
The Company shall maintain (i) an office or agency where Senior Notes may be
presented for registration of transfer or for exchange ("Registrar") and (ii) an
office or agency where Senior Notes may be presented for payment ("Paying
Agent"). The Registrar shall keep a register of the Senior Notes and of their
transfer and exchange. The Company may appoint one or more co-registrars and
one or more additional paying agents. The term "Registrar" includes any co-
registrar and the term "Paying Agent" includes any additional paying agent. The
Company may change any Paying Agent or Registrar without notice to any Holder.
The Company shall notify the Trustee in writing of the name and address of any
Agent not a party to this Indenture. If the Company fails to appoint or
maintain another entity as Registrar or Paying Agent, the Trustee shall act as
such. The Company or any of its Subsidiaries may act as Paying Agent or
Registrar.
The Company initially appoints The Depository Trust Company ("DTC") to act
as Depository with respect to the Global Notes.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Senior Note Custodian with respect to the Global
Notes.
Section 2.04. Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the Trustee to agree
in writing that the Paying Agent will hold in trust for the benefit of Holders
or the Trustee all money held by the Paying Agent for the payment of principal,
premium or Liquidated Damages, if any, or interest on the Senior Notes, and will
notify the Trustee of any default by the Company in making any such payment.
While any such default continues, the Trustee may require a Paying Agent to pay
all money held by it to the Trustee. The Company at any time may require a
Paying Agent to pay all money held by it to the Trustee. Upon payment over to
the Trustee, the Paying Agent (if other than the Company or a Subsidiary) shall
have no further liability for the money. If the Company or a Subsidiary acts as
Paying Agent, it shall segregate and hold in a separate
trust fund for the benefit of the Holders all money held by it as Paying Agent.
Upon any bankruptcy or reorganization proceedings relating to the Company, the
Trustee shall serve as Paying Agent for the Senior Notes.
Section 2.05. Holder Lists.
The Trustee shall preserve in as current a form as is reasonably practicable
the most recent list available to it of the names and addresses of all Holders
and shall otherwise comply with TIA (S) 312(a). If the Trustee is not the
Registrar, the Company shall furnish to the Trustee at least seven Business Days
before each interest payment date and at such other times as the Trustee may
request in writing, a list in such form and as of such date as the Trustee may
reasonably require of the names and addresses of the Holders of Senior Notes and
the Company shall otherwise comply with TIA (S) 312(a).
Section 2.06. Transfer and Exchange .
(a) Transfer and Exchange of Definitive Senior Notes. When Definitive
Senior Notes are presented by a Holder to the Registrar with a request:
(x) to register the transfer of the Definitive Senior Notes; or
(y) to exchange such Definitive Senior Notes for an equal principal
amount of Definitive Senior Notes of other authorized denominations,
the Registrar shall register the transfer or make the exchange as requested if
its requirements for such transactions are met; provided, however, that the
Definitive Senior Notes presented or surrendered for register of transfer or
exchange:
(i) shall be duly endorsed or accompanied by a written instruction
of transfer in form satisfactory to the Registrar duly executed
by such Holder or by his attorney, duly authorized in writing;
and
(ii) in the case of a Definitive Senior Notes that is a Transfer
Restricted Security, such request shall be accompanied by the
following additional information and documents, as applicable:
(A) if such Transfer Restricted Security is being delivered to
the Registrar by a Holder for registration in the name of
such Holder, without transfer, a certification to that
effect from such Holder (in substantially the form of
Exhibit B hereto); or
(B) if such Transfer Restricted Security is being transferred
to a "qualified institutional buyer" (as defined in Rule
144A under the Securities Act) in accordance with Rule 144A
under the Securities Act or pursuant to an exemption from
registration in accordance with Rule 144
under the Securities Act or pursuant to an effective
registration statement under the Securities Act, a
certification to that effect from such Holder (in
substantially the form of Exhibit B hereto); or
---------
(C) if such Transfer Restricted Security is being transferred
in reliance on another exemption from the registration
requirements of the Securities Act, a certification to that
effect from such Holder (in substantially the form of
Exhibit B hereto) and an Opinion of Counsel from such
---------
Holder or the transferee reasonably acceptable to the
Company and to the Registrar to the effect that such
transfer is in compliance with the Securities Act.
(b) Transfer of Definitive Senior Notes for a Beneficial Interest in a
Global Note. Definitive Senior Notes may not be exchanged for a beneficial
interest in a Global Note except upon satisfaction of the requirements set forth
below. Upon receipt by the Trustee of Definitive Senior Notes, duly endorsed or
accompanied by appropriate instruments of transfer, in form satisfactory to the
Trustee, together with:
(i) if such Definitive Senior Notes are Transfer Restricted Securities,
a certification from the Holder thereof (in substantially the form
of Exhibit B hereto) to the effect that such Definitive Senior
Notes are being transferred by such Holder to a "qualified
institutional buyer" (as defined in Rule 144A under the Securities
Act) in accordance with Rule 144A under the Securities Act; and
(ii) whether or not such Definitive Senior Notes are Transfer Restricted
Securities, written instructions from the Holder thereof directing
the Trustee to make, or to direct the Senior Note Custodian to
make, an endorsement on the Global Note to reflect an increase in
the aggregate principal amount of the Senior Notes represented by
the Global Note,
in which case the Trustee shall cancel such Definitive Senior Notes in
accordance with Section 2.11 hereof and cause, or direct the Senior Note
Custodian to cause, in accordance with the standing instructions and procedures
existing between the Depository and the Senior Note Custodian, the aggregate
principal amount of Senior Notes represented by the Global Note to be increased
accordingly. If no Global Notes are then outstanding, the Company shall issue
and, upon receipt of an authentication order in accordance with Section 2.02
hereof, the Trustee shall authenticate a new Global Note in the appropriate
principal amount.
(c) Transfer and Exchange of a Global Note. The transfer and exchange of a
Global Note or beneficial interests therein shall be effected through the
Depository, in accordance with this Indenture and the procedures of the
Depository therefor, which shall include restrictions on transfer comparable to
those set forth herein to the extent required by the Securities Act.
(d) Transfer of a Beneficial Interest in a Global Note for Definitive
Senior Note.
(i) Any Person having a beneficial interest in a Global Note may upon
request exchange such beneficial interest for Definitive Senior
Notes. Upon receipt by the Trustee of written instructions or such
other form of instructions as is customary for the Depository, from
the Depository or its nominee on behalf of any Person having a
beneficial interest in a Global Note, and, in the case of Transfer
Restricted Securities, the following additional information and
documents (all of which may be submitted by facsimile):
(A) if such beneficial interest is being transferred to the Person
designated by the Depository as being the beneficial owner, a
certification to that effect from such Person (in substantially
the form of Exhibit B hereto); or
---------
(B) if such beneficial interest is being transferred to a
"qualified institutional buyer" (as defined in Rule 144A under
the Securities Act) in accordance with Rule 144A under the
Securities Act or pursuant to an exemption from registration in
accordance with Rule 144 under the Securities Act or pursuant
to an effective registration statement under the Securities
Act, a certification to that effect from the transferor (in
substantially the form of Exhibit B hereto); or
---------
(C) if such beneficial interest is being transferred in reliance on
another exemption from the registration requirements of the
Securities Act, a certification to that effect from the
transferor (in substantially the form of Exhibit B hereto) and
an Opinion of Counsel from the transferee or transferor
reasonably acceptable to the Company and to the Registrar to
the effect that such transfer is in compliance with the
Securities Act,
in which case the Trustee or the Senior Note Custodian, at the
direction of the Trustee, shall, in accordance with the standing
instructions and procedures existing between the Depository and the
Senior Note Custodian, cause the aggregate principal amount of a
Global Note to be reduced accordingly and, following such
reduction, the Company shall execute and, upon receipt of an
authentication order in accordance with Section 2.02 hereof, the
Trustee shall authenticate and deliver to the transferee Definitive
Senior Notes in the appropriate principal amount.
(ii) Definitive Senior Notes issued in exchange for a beneficial
interest in a Global Note pursuant to this Section 2.06(d) shall be
registered in such names and in such authorized denominations as
the Depository, pursuant to instructions from its direct or
indirect participants or otherwise, shall instruct the Trustee. The
Trustee shall deliver such Definitive Senior Notes to the Persons
in whose names such Definitive Senior Notes are so registered.
(e) Restrictions on Transfer and Exchange of a Global Note. Notwithstanding
any other provision of this Indenture (other than the provisions set forth in
subsection (f) of this Section 2.06), a Global Note may not be transferred as a
whole except by the Depository to a nominee of the Depository or by a nominee of
the Depository to the Depository or another nominee of the Depository or by the
Depository or any such nominee to a successor Depository or a nominee of such
successor Depository.
(f) Authentication of Definitive Senior Notes in Absence of Depository.
If at any time:
(i) the Depository for the Senior Notes notifies the Company that the
Depository is unwilling or unable to continue as Depository for the
Global Note and a successor Depository for the Global Note is not
appointed by the Company within 90 days after delivery of such
notice; or
(ii) the Company, at its sole discretion, notifies the Trustee in
writing that it elects to cause the issuance of Definitive Senior
Notes under this Indenture,
then the Company shall execute, and the Trustee shall, upon receipt of an
authentication order in accordance with Section 2.02 hereof, authenticate and
deliver, Definitive Senior Notes in an aggregate principal amount equal to the
principal amount of the Global Note in exchange for such Global Note.
(g) Legends.
(i) Except as permitted by the following paragraphs (ii) and (iii),
each Senior Note certificate evidencing a Global Note and
Definitive Senior Notes (and all Senior Notes issued in exchange
therefor or substitution thereof) shall bear legends in
substantially the following form:
"THE SENIOR NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER
SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), AND THE SENIOR NOTE EVIDENCED HEREBY MAY
NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THE SENIOR NOTE EVIDENCED HEREBY IS HEREBY NOTIFIED
THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS
OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER. BY ITS ACQUISITION HEREOF, THE HOLDER OF THE SENIOR
NOTE EVIDENCED HEREBY AGREES FOR THE BENEFIT OF HYPERION
TELECOMMUNICATIONS, INC. (THE "COMPANY") THAT (A) SUCH SENIOR NOTE
MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1) (A) TO A
PERSON WHO THE SELLER REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (B) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (C) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF
COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY OR (3)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE,
IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE
HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
PURCHASER OF THE SENIOR NOTE EVIDENCED HEREBY OF THE RESALE
RESTRICTIONS SET FORTH IN (1) ABOVE."
FOR PURPOSES OF SECTION 1272, 1273 AND 1275 OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED, THIS SECURITY IS BEING ISSUED WITH
ORIGINAL ISSUE DISCOUNT; FOR EACH $1,000 PRINCIPAL AMOUNT OF THIS
SECURITY, THE ISSUE PRICE IS $532.72, THE AMOUNT OF ORIGINAL ISSUE
DISCOUNT IS $467.28, THE ISSUE DATE IS APRIL 15, 1996 AND THE YIELD
TO MATURITY IS 13% PER ANNUM."
(ii) Upon any sale or transfer of a Transfer Restricted Security
(including any Transfer Restricted Security represented by a Global
Note) pursuant to Rule 144 under the Securities Act or pursuant to
an effective registration statement under the Securities Act:
(A) in the case of any Transfer Restricted Securities that are
Definitive Senior Notes, the Registrar shall permit the Holder
thereof to exchange such Transfer Restricted Securities for
Definitive Senior Notes that do not bear the first legend set
forth in (i) above and rescind any restriction on the transfer
of such Transfer Restricted Securities; and
(B) in the case of any Transfer Restricted Securities represented
by a Global Note, such Transfer Restricted Securities shall not
be required to bear the first legend set forth in (i) above,
but shall continue to be subject to the provisions of Section
2.06(c) hereof; provided, however, that with respect to any
request for an exchange of Transfer Restricted Securities that
are represented by a Global Note for Definitive Senior Notes
that do not bear the first legend set forth in (i) above, which
request is made in reliance upon Rule 144, the Holder thereof
shall certify in writing to the Registrar that such request is
being made pursuant to Rule 144 (such certification to be
substantially in the form of Exhibit B hereto).
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(iii) Notwithstanding the foregoing, upon consummation of the Exchange
Offer, the Company shall issue and, upon receipt of an
authentication order in accordance with Section 2.02 hereof, the
Trustee shall authenticate Series B Senior Notes in exchange for
Series A Senior
Notes accepted for exchange in the Exchange Offer, which Series B
Senior Notes shall not bear the first legend set forth in (i)
above, and the Registrar shall rescind any restriction on the
transfer of such Senior Notes, in each case unless the Holder of
such Series A Senior Notes is either (A) a broker-dealer, (B) a
Person participating in the distribution of the Series A Senior
Notes or (C) a Person who is an affiliate (as defined in Rule 144A)
of the Company.
(h) Cancellation and/or Adjustment of a Global Note. At such time as all
beneficial interests in a Global Note have been exchanged for Definitive Senior
Notes, redeemed, repurchased or cancelled, such Global Note shall be returned to
or retained and cancelled by the Trustee in accordance with Section 2.11 hereof.
At any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for Definitive Senior Notes, redeemed, repurchased or
cancelled, the principal amount of Senior Notes represented by such Global Note
shall be reduced accordingly and an endorsement shall be made on such Global
Note, by the Trustee or the Senior Notes Custodian, at the direction of the
Trustee, to reflect such reduction.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the Company
shall execute and the Trustee shall authenticate Definitive Senior
Notes and Global Notes at the Registrar's request.
(ii) No service charge shall be made to a Holder for any registration of
transfer or exchange, but the Company may require payment of a sum
sufficient to cover any transfer tax or similar governmental charge
payable in connection therewith (other than any such transfer taxes
or similar governmental charge payable upon exchange or transfer
pursuant to Sections 3.07, 4.10, 4.15 and 9.05 hereto).
(iii) The Registrar shall not be required to register the transfer of or
exchange any Senior Note selected for redemption in whole or in
part, except the unredeemed portion of any Senior Note being
redeemed in part.
(iv) All Definitive Senior Notes and Global Notes issued upon any
registration of transfer or exchange of Definitive Senior Notes or
Global Notes shall be the valid obligations of the Company,
evidencing the same debt, and entitled to the same benefits under
this Indenture, as the Definitive Senior Notes or Global Notes
surrendered upon such registration of transfer or exchange.
(v) The Company shall not be required:
(A) to issue, to register the transfer of or to exchange Senior
Notes during a period beginning at the opening of business 15
days before the day of any selection of Senior Notes for
redemption under Section 3.02 hereof and ending at the close of
business on the day of selection; or
(B) to register the transfer of or to exchange any Senior Note so
selected for redemption in whole or in part, except the
unredeemed portion of any Senior Note being redeemed in part;
or
(C) to register the transfer of or to exchange a Senior Note
between a record date and the next succeeding interest payment
date.
(vi) Prior to due presentment for the registration of a transfer of any
Senior Note, the Trustee, any Agent and the Company may deem and
treat the Person in whose name any Senior Note is registered as the
absolute owner of such Senior Note for the purpose of receiving
payment of principal of and interest on such Senior Notes, and
neither the Trustee, any Agent nor the Company shall be affected by
notice to the contrary.
(vii) The Trustee shall authenticate Definitive Senior Notes and a Global
Note in accordance with the provisions of Section 2.02 hereof.
(j) The Senior Notes and the Warrants will not be separately exchangeable or
transferable prior to the Separation Date, at which time the Senior
Notes shall become separately exchangeable and transferable. Prior to
the Separation Date, Senior Notes will be exchangeable and transferable
only together with the Warrants related thereto as set forth herein and
in the Warrant Agreement.
Section 2.07. Replacement Senior Notes.
If any mutilated Senior Note is surrendered to the Trustee, or the Company
and the Trustee receives evidence to its satisfaction of the destruction, loss
or theft of any Senior Note, the Company shall issue and the Trustee, upon the
written order of the Company signed by two Officers of the Company, shall
authenticate a replacement Senior Note if the Trustee's requirements are met.
If required by the Trustee or the Company, an indemnity bond must be supplied by
the Holder that is sufficient in the judgment of the Trustee and the Company to
protect the Company, the Trustee, any Agent and any authenticating agent from
any loss that any of them may suffer if a Senior Note is replaced. The Company
may charge for its expenses in replacing a Senior Note.
Every replacement Senior Note is an additional obligation of the Company and
shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Senior Notes duly issued hereunder.
Section 2.08. Outstanding Senior Notes.
The Senior Notes outstanding at any time are all the Senior Notes
authenticated by the Trustee except for those cancelled by it, those delivered
to it for cancellation, those reductions in the interest in a Global Note
effected by the Trustee in accordance with the provisions hereof, and those
described in this Section as not outstanding. Except as set forth in Section
2.09 hereof, a Senior Note does not cease to be outstanding because the Company
or an Affiliate of the Company holds the Senior Note.
If a Senior Note is replaced pursuant to Section 2.07 hereof, it ceases to
be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Senior Note is held by a bona fide purchaser.
If the principal amount of any Senior Note is considered paid under Section
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an Affiliate of
any thereof) holds, on a redemption date or maturity date, money sufficient to
pay Senior Notes payable on that date, then on and after that date such Senior
Notes shall be deemed to be no longer outstanding and shall cease to accrete or
accrue interest.
Section 2.09. Treasury Senior Notes.
In determining whether the Holders of the required principal amount of
Senior Notes have concurred in any direction, waiver or consent, Senior Notes
owned by the Company, or by any Affiliate thereof shall be considered as though
not outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Senior Notes that a Trustee knows are so owned shall be so disregarded.
Section 2.10. Temporary Senior Notes.
Until definitive Senior Notes are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Senior Notes upon a written
order of the Company signed by two Officers of the Company. Temporary Senior
Notes shall be substantially in the form of definitive Senior Notes but may have
variations that the Company considers appropriate for temporary Senior Notes and
as shall be reasonably acceptable to the Trustee. Without unreasonable delay,
the Company shall prepare and the Trustee shall authenticate definitive Senior
Notes in exchange for temporary Senior Notes.
Holders of temporary Senior Notes shall be entitled to all of the benefits
of this Indenture.
Section 2.11. Cancellation.
The Company at any time may deliver Senior Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Senior
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Senior Notes surrendered for
registration of transfer, exchange, payment, replacement or cancellation and
shall destroy cancelled Senior Notes (subject to the record retention
requirement of the Exchange Act). Certification of the destruction of all
cancelled Senior Notes shall be delivered to the Company. The Company may not
issue new Senior Notes to replace Senior Notes that it has paid or that have
been delivered to the Trustee for cancellation.
Section 2.12. Record Date.
The record date for purposes of determining the identity of Holders of the
Senior Notes entitled to vote or consent to any action by vote or consent
authorized or permitted under this Indenture shall be determined as provided for
in TIA (S) 316 (c).
Section 2.13. Defaulted Interest.
If the Company defaults in a payment of interest on the Senior Notes, it
shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Senior Notes and in Section 4.01 hereof. The Company shall notify the
Trustee in writing of the amount of defaulted interest proposed to be paid on
each Senior Note and the date of the proposed payment. The Company shall fix or
cause to be fixed each such special record date and payment date, provided that
no such special record date shall be less than 10 days prior to the related
payment date for such defaulted interest. At least 15 days before the special
record date, the Company (or, upon the written request of the Company, the
Trustee in the name and at the expense of the Company) shall mail or cause to be
mailed to Holders a notice that states the special record date, the related
payment date and the amount of such interest to be paid.
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee.
If the Company elects to redeem Senior Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 45 days but not more than 60 days before a redemption date, an
Officers' Certificate setting forth (i) the clause of this Indenture pursuant to
which the redemption shall occur, (ii) the redemption date, (iii) the principal
amount of Senior Notes to be redeemed and (iv) the redemption price.
Section 3.02. Selection of Senior Notes to Be Redeemed.
If less than all of the Senior Notes are to be redeemed at any time, the
Trustee shall select the Senior Notes to be redeemed among the Holders of the
Senior Notes in compliance with the requirements of the principal national
securities exchange, if any, on which the Senior Notes are listed or, if the
Senior Notes are not so listed, on a pro
rata basis, by lot or in accordance with any other method the Trustee considers
fair and appropriate. In the event of partial redemption by lot, the particular
Senior Notes to be redeemed shall be selected, unless otherwise provided herein,
not less than 30 nor more than 60 days prior to the redemption date by the
Trustee from the outstanding Senior Notes not previously called for redemption.
The Trustee shall promptly notify the Company in writing of the Senior Notes
selected for redemption and, in the case of any Senior Note selected for partial
redemption, the principal amount thereof to be redeemed. Senior Notes and
portions of Senior Notes selected shall be in amounts of $1,000 or whole
multiples of $1,000; except that if all of the Senior Notes of a Holder are to
be redeemed, the entire outstanding amount of Senior Notes held by such Holder,
even if not a multiple of $1,000, shall be redeemed. Except as provided in the
preceding sentence, provisions of this Indenture that apply to Senior Notes
called for redemption also apply to portions of Senior Notes called for
redemption.
Section 3.03. Notice of Redemption.
Subject to the provisions of Section 3.09 hereof, at least 30 days but not
more than 60 days before a redemption date, the Company shall mail or cause to
be mailed, by first class mail, a notice of redemption to each Holder whose
Senior Notes are to be redeemed at its registered address.
The notice shall identify the Senior Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Senior Note is being redeemed in part, the portion of the
principal amount of such Senior Note to be redeemed and that, after the
redemption date upon surrender of such Senior Note, a new Senior Note or Senior
Notes in principal amount equal to the unredeemed portion shall be issued upon
cancellation of the original Senior Note;
(d) the name and address of the Paying Agent;
(e) that Senior Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption payment,
interest on Senior Notes called for redemption ceases to accrue on and
after the redemption date;
(g) the paragraph of the Senior Notes and/or Section of this Indenture
pursuant to which the Senior Notes called for redemption are being
redeemed; and
(h) that no representation is made as to the correctness or accuracy of
the CUSIP number, if any, listed in such notice or printed on the Senior
Notes.
At the Company's request, the Trustee shall give the notice of redemption in
the Company's name and at its expense; provided, however, that the Company shall
have delivered 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 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03 hereof,
Senior Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. A notice of redemption may not be
conditional.
Section 3.05. Deposit of Redemption Price.
One Business Day prior to the redemption date, the Company shall deposit
with the Trustee or with the Paying Agent money sufficient to pay the redemption
price of and accrued interest on all Senior Notes to be redeemed on that date.
The Trustee or the Paying Agent shall promptly return to the Company any money
deposited with the Trustee or the Paying Agent by the Company in excess of the
amounts necessary to pay the redemption price of, accrued interest on and
Liquidated Damages, if any, all Senior Notes to be redeemed.
If the Company complies with the provisions of the preceding paragraph, on
and after the redemption date, interest shall cease to accrue on the Senior
Notes or the portions of Senior Notes called for redemption. If a Senior Note
is redeemed on or after an interest record date but on or prior to the related
interest payment date, then any accrued and unpaid interest and Liquidated
Damages, if any, shall be paid to the Person in whose name such Senior Note was
registered at the close of business on such record date. If any Senior Note
called for redemption shall not be so paid upon surrender for redemption because
of the failure of the Company to comply with the preceding paragraph, interest
shall be paid on the unpaid principal, from the redemption date until such
principal is paid, and to the extent lawful on any interest not paid on such
unpaid principal, in each case at the rate provided in the Senior Notes and in
Section 4.01 hereof.
Section 3.06. Senior Notes Redeemed in Part.
Upon surrender of a Senior Note that is redeemed in part, the Company shall
issue and, upon the Company's written request, the Trustee shall authenticate
for the Holder at the expense of the Company a new Senior Note equal in
principal amount to the unredeemed portion of the Senior Note surrendered.
Section 3.07. Optional Redemption.
(a) Except as set forth in clause (b) of this Section 3.07, the Company
shall not have the option to redeem the Senior Notes prior to April 15, 2001.
Thereafter, the Company shall have the option to redeem the Senior Notes, in
whole or in part, upon not less than 30 nor more than 60 days notice, at the
redemption prices (expressed as
percentages of principal amount, of, if such redemption occurs prior to April
15, 2001, the Accreted Value) set forth below plus accrued and unpaid interest
thereon and Liquidated Damages, if any, to the applicable redemption date, if
redeemed during the twelve-month period beginning on April 15 of the years
indicated below:
Year Percentage
---- ----------
2001....................................... 106.5%
2002 and thereafter........................ 100.0%
(b) Notwithstanding the foregoing, the Company, on or prior to April 15,
1999, may redeem up to a maximum of 25% of the aggregate principal amount of the
Senior Notes then outstanding at a redemption price of 113.0% of the Accreted
Value thereof, with the net proceeds from either (i) an Initial Public Offering
of the common stock of the Company or (ii) a sale of the Capital Stock (other
than Disqualified Stock) of the Company to a Strategic Investor in a single
transaction or a series of related transactions for at least $25.0 million;
provided that, in either case, at least 75% in aggregate principal amount of the
Senior Notes remain outstanding immediately after the occurrence of such
redemption; and provided, further, that such redemption shall occur within 90
days of the date of the closing of such Initial Public Offering or such sale to
a Strategic Investor, as the case may be.
(c) Any redemption pursuant to this Section 3.07 shall be made pursuant to
the provisions of Section 3.01 through 3.06 hereof.
Section 3.08. Mandatory Redemption.
Except as set forth under Sections 4.10 and 4.15 hereof, the Company shall
not be required to make mandatory redemption or sinking fund payments with
respect to the Senior Notes.
Section 3.09. Offer to Purchase by Application of Excess Proceeds.
In the event that, pursuant to Section 4.10 hereof, the Company shall be
required to commence an offer to all Holders to purchase Senior Notes (an "Asset
Sale Offer"), it shall follow the procedures specified below.
The Asset Sale Offer shall remain open for a period of 20 Business Days
following its commencement and no longer, except to the extent that a longer
period is required by applicable law (the "Offer Period"). No later than five
Business Days after the termination of the Offer Period (the "Purchase Date"),
the Company shall purchase the principal amount of Senior Notes required to be
purchased pursuant to Section 4.10 hereof (the "Offer Amount") or, if less than
the Offer Amount has been tendered, all Senior Notes tendered in response to the
Asset Sale Offer. Payment for any Senior Notes so purchased shall be made in
the same manner as interest payments are made.
The Company shall comply with any tender offer rules under the Exchange Act
which may then be applicable, including Rule 14e-1, in connection with any offer
required to be made by the Company to repurchase the Senior Notes as a result of
an Asset Sale Offer. To the extent that the provisions of any securities laws
or regulations conflict with provisions of this Section 3.09, the Company shall
comply with the applicable securities laws or regulations and shall not be
deemed to have breached its obligations hereunder by virtue thereof.
If the Purchase Date is on or after an interest record date and on or before
the related interest payment date, any accrued and unpaid interest shall be paid
to the Person in whose name a Senior Note is registered at the close of business
on such record date, and no additional interest shall be payable to Holders who
tender Senior Notes pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, the Company shall send, by
first class mail, a notice to the Trustee and each of the Holders, with a copy
to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Senior Notes pursuant to the Asset
Sale Offer. The Asset Sale Offer shall be made to all Holders. The notice,
which shall govern the terms of the Asset Sale Offer, shall state:
(a) that the Asset Sale Offer is being made pursuant to this Section
3.09 and Section 4.10 hereof and the length of time the Asset Sale Offer shall
remain open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Senior Note not tendered or accepted for payment shall
continue to accrete or accrue interest;
(d) that, unless the Company defaults in making such payment, any
Senior Note accepted for payment pursuant to the Asset Sale Offer shall cease to
accrete or accrue interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to an
Asset Sale Offer may only elect to have all of such Note purchased and may not
elect to have only a portion of such Note purchased;
(f) that Holders electing to have a Senior Note purchased pursuant to
any Asset Sale Offer shall be required to surrender the Senior Note, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the Senior
Note completed, or transfer by book-entry transfer, to the Company, a
depositary, if appointed by the Company, or a Paying Agent at the address
specified in the notice at least three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if the
Company, the depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Senior Note the
Holder delivered for purchase and a statement that such Holder is withdrawing
his election to have such Senior Note purchased;
(h) that, if the aggregate principal amount of Senior Notes
surrendered by Holders exceeds the Offer Amount, the Company shall select the
Senior Notes to be purchased on a pro rata basis (with such adjustments as may
be deemed appropriate by the Company so that only Senior Notes in denominations
of $1,000, or integral multiples thereof, shall be purchased); and
(i) that Holders whose Senior Notes were purchased only in part shall
be issued new Senior Notes equal in principal amount to the unpurchased portion
of the Senior Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company shall, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, the Offer
Amount of Senior Notes or portions thereof tendered pursuant to the Asset Sale
Offer, or if less than the Offer Amount has been tendered, all Senior Notes
tendered, and shall deliver to the Trustee an Officers' Certificate stating that
such Senior Notes or portions thereof were accepted for payment by the Company
in accordance with the terms of this Section 3.09. The Company, the Depository
or the Paying Agent, as the case may be, shall promptly (but in any case not
later than five days after the Purchase Date) mail or deliver to each tendering
Holder an amount equal to the purchase price of the Senior Notes tendered by
such Holder and accepted by the Company for purchase, and the Company shall
promptly issue a new Senior Note, and the Trustee, upon written request from the
Company shall authenticate and mail or deliver such new Senior Note to such
Holder, in a principal amount equal to any unpurchased portion of the Senior
Note surrendered. Any Senior Note not so accepted shall be promptly mailed or
delivered by the Company to the Holder thereof. The Company shall publicly
announce the results of the Asset Sale Offer on the Purchase Date.
Other than as specifically provided in this Section 3.09, any purchase
pursuant to this Section 3.09 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 hereof.
ARTICLE 4
COVENANTS
Section 4.01. Payment of Senior Notes.
The Company shall pay or cause to be paid the principal of, premium, if any,
and interest on the Senior Notes (including any additional interest required to
be paid pursuant to the provisions of the Registration Rights Agreement) on the
dates and in the manner provided in the Senior Notes. Principal, premium, if
any, and interest shall be considered paid on the date due if the Paying Agent,
if other than the Company or a Subsidiary thereof, holds as of 10:00 a.m.
Eastern Time on the due date money deposited by the Company in immediately
available funds and designated for and sufficient to pay all principal, premium,
if any, and interest then due.
The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal at the rate equal to
1% per annum in excess of the then applicable interest rate on the Senior Notes
to the extent lawful; it shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages (without regard to any applicable grace period) at the same
rate to the extent lawful.
Section 4.02. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, the City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Senior Notes may be surrendered
for registration of transfer or for exchange and where notices and demands to or
upon the Company in respect of the Senior Notes and this Indenture may be
served. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.
The Company may also from time to time designate one or more other offices
or agencies where the Senior Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York for such purposes. The Company shall give
prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the Trustee as
one such office or agency of the Company in accordance with Section 2.03 hereof.
Section 4.03. Reports.
(a) Whether or not required by the rules and regulations of the SEC, so
long as any Senior Notes are outstanding, the Company shall furnish to the
Holders of Senior Notes (i) all quarterly and annual financial information that
would be required to be contained in a filing with the SEC on Forms 10-Q and 10-
K if the Company were required to file such Forms, including a "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and,
with respect to the annual information only, a report thereon by the Company's
certified independent accountants; (ii) all current reports that would be
required to be filed with the SEC on Form 8-K if the Company were required to
file such reports; and (iii) on a quarterly basis, certain financial information
and operating data with respect to each Subsidiary and Joint Venture engaged in
a Telecommunications Business, in the form specified by Schedule E hereto. In
addition, whether or not required by the rules and regulations of the SEC the
Company shall file a copy of all such information and reports with the SEC for
public availability (unless the SEC will not accept such a filing) and make such
information available to securities analysts and prospective investors upon
request. The Company shall at all times comply with TIA (S) 314(a).
(b) For so long as any Senior Notes remain outstanding, the Company shall
furnish to all Holders and to securities analysts and prospective investors,
promptly upon their request, the information required to be delivered pursuant
to Rule 144A(d)(4) under the Securities Act.
Section 4.04. Compliance Certificate.
(a) The Company shall deliver to the Trustee, within 90 days after the end
of each fiscal year, an Officers' Certificate stating that a review of the
activities of the Company, its Subsidiaries and Joint Ventures during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company has kept, observed, performed and fulfilled
each and every covenant contained in this Indenture and is not in default in the
performance or observance of any of the terms, provisions and conditions of this
Indenture (or, if a Default or Event of Default shall have occurred, describing
all such Defaults or Events of Default of which he or she may have knowledge and
what action the Company is taking or proposes 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 Senior Notes is prohibited or if such event has
occurred, a description of the event and what action the Company is taking or
proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03(a) above shall be accompanied by a
written statement of the Company's independent public accountants (who shall be
a firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Company has violated
any provisions of Article Four or Article Five hereof or, if any such violation
has occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.
(c) The Company shall, so long as any of the Senior 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 is taking or proposes to take with
respect thereto.
Section 4.05. Taxes.
The Company shall pay, and shall cause each of its Subsidiaries and Joint
Ventures to pay, prior to delinquency, all material taxes, assessments, and
governmental levies, except such as are contested in good faith and by
appropriate
proceedings or where the failure to effect such payment is not adverse in any
material respect to the Holders of Senior Notes.
Section 4.06. Stay, Extension and Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, that may affect the covenants or
the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it shall not, by resort to any such law, hinder, delay
or impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law has
been enacted.
Section 4.07. Restricted Payments.
The Company shall not, and (i) shall not permit any of its Subsidiaries or
Joint Ventures to, directly or indirectly: (a) declare or pay any dividend or
make any other payment or distribution on account of the Company's Equity
Interests (other than dividends or distributions payable in Equity Interests
(other than Disqualified Stock) of the Company or dividends or distributions
payable to the Company or any Wholly Owned Subsidiary); (b) purchase, redeem or
otherwise acquire or retire for value any Equity Interests of the Company or any
direct or indirect parent of the Company (other than Equity Interests owned by
the Company or any Wholly Owned Subsidiary of the Company); or (c) purchase,
redeem or otherwise acquire or retire for value, prior to a scheduled mandatory
sinking fund payment date or maturity date, any Indebtedness of the Company
which ranks subordinated in right to payment to the Senior Notes and (ii) shall
not permit any of its Subsidiaries or Permitted Joint Ventures to, make any
Investment other than a Permitted Investment (all such payments and other
actions set forth in clauses (i) and (ii) above being collectively referred to
as "Restricted Payments") unless, at the time of and after giving effect to such
Restricted Payment:
(x) no Default or Event of Default shall have occurred and be continuing
or would occur as a consequence thereof; and
(y) such Restricted Payment, together with the aggregate amount of all
other Restricted Payments (including, without limitation, all Restricted
Payments referred to in clauses (a), (b) and (c)(1) below but excluding those
made under clauses (c)(2), (d) and (e) below) made by the Company and its
Subsidiaries after the date of the Indenture is less than the sum of: (1) the
excess of (A) Cumulative Pro Forma EBITDA over (B) 2.0 times Cumulative Interest
Expense plus (2) the aggregate net cash proceeds received by the Company (other
than from a Subsidiary or Joint Venture) (A) as capital contributions to the
Company, (B) from the issuance and sale of Equity Interest, other than
Disqualified Stock, and (C) from the issuance and sale of Indebtedness that is
convertible into Capital Stock (other than Disqualified Stock), to the extent
such Indebtedness is actually converted into such Capital Stock (clauses (A),
(B) and (C) collectively referred to as "Equity Issuances"), other than any such
net cash proceeds from Equity Issuances that were used as set forth in clause
(c) and (d) below; and
(z) the Company would, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been made at
the beginning of the applicable four-quarter period, have been permitted to
incur at least $1.00 of additional Indebtedness other than Permitted
Indebtedness.
The foregoing provisions shall not prohibit:
(a) the payment of any Required Capital Contribution;
(b) the payment of any dividend within 60 days after the date of
declaration thereof, if at said date of declaration such payment
would have complied with this Section 4.07;
(c) so long as no Default or Event of Default shall have occurred and be
continuing, Restricted Joint Venture Investments, which at the time
any such Restricted Joint Venture Investment was made, did not cause
the aggregate amount of all Restricted Joint Venture Investments made
on or after the date of this Indenture and then outstanding under
this clause (c) to exceed (1) $20.0 million plus (2) the net cash
proceeds from Equity Issuances not used as set forth in clause (y)
above and clause (d) below;
(d) so long as no Default or Event of Default shall have occurred and be
continuing, the making of any Investment in a Telecommunications
Business out of the net cash proceeds from Equity Issuances not used
as set forth in clauses (y) and (c)(2) above; or
(e) so long as no Default or Event of Default shall have occurred and be
continuing, the making of loans and advances to the senior management
of the Company in an amount not to exceed $3.0 million in aggregate
principal amount.
(f) all payments pursuant to the Athird sentence of Section 15 of the
Warrant Agreement, dated April 15, 1996, between the Company and the
Bank of Montreal Trust Company, as Warrant Agent.
For purposes of this Section 4.07, in the event that a Restricted Joint
Venture becomes a Permitted Joint Venture or otherwise ceases to be a Restricted
Joint Venture, all of the then outstanding Investments made by such entity since
the date of the Indenture shall be deemed to have been made as of the date that
such Restricted Joint Venture becomes a Permitted Joint Venture or otherwise
ceases to be a Restricted Joint Venture; provided that if a Restricted Joint
Venture ceases to be a Restricted Joint Venture as a result of (i) the loss of
its Local Partner or (ii) the loss of management control of such Restricted
Joint Venture, then the provisions of this paragraph shall not be applied to
such entity.
The amount of all Restricted Payments, other than cash, shall be the fair
market value (evidenced by a resolution of the Board of Directors set forth in
an Officers' Certificate delivered to the Trustee) on the date of such
Restricted Payment of the asset(s) proposed to be transferred by the Company or
such Subsidiary, as the case may
be, pursuant to such Restricted Payment. Not later than the date of making any
Restricted Payment, the Company shall deliver to the Trustee an Officers'
Certificate stating that such Restricted Payment is permitted and setting forth
the basis upon which the calculations required by this Section 4.07 were
computed, which calculations may be based upon the Company's latest available
financial statements.
Section 4.08. Dividend and Other Payment Restrictions Affecting Subsidiaries.
The Company shall not, and shall not permit any of its 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 Subsidiary to:
(i) (a) pay dividends or make any other distributions to the Company
or any of its Subsidiaries (1) on its Capital Stock or (2) with
respect to any other interest or participation in, or measured by,
its profits, or (b) pay any indebtedness owed to the Company or
any of its Subsidiaries;
(ii) make loans or advances to the Company or any of its Subsidiaries;
(iii) grant liens or grant security interests on its asset in favor of
the Holders of Senior Notes or guarantee the payment of the Senior
Notes; or
(iv) transfer any of its properties or assets to the Company or any of
its Subsidiaries,
except for such encumbrances or restrictions existing under or by reason of:
(a) Existing Indebtedness as in effect on the date of this Indenture;
(b) any Credit Agreement creating or evidencing Indebtedness permitted by
clause (i) of Section 4.09 and any amendments, modifications,
restatements, renewals, increases, supplements, refundings,
replacements or refinancings thereof;
(c) the Indenture and the Senior Notes;
(d) applicable law;
(e) by reason of customary non-assignment provisions in leases entered
into in the ordinary course of business and consistent with past
practices;
(f) purchase money obligations or Vendor Debt for property acquired in the
ordinary course of business that impose restrictions of the nature
described in clause (iv) above on the property so acquired;
(g) Indebtedness incurred pursuant to the clause (viii) of Section 4.09;
provided that such encumbrance or restriction only relates to the
Subsidiary or Permitted Joint Venture incurring such Indebtedness; and
(h) Refinancing Indebtedness, provided that such encumbrances or
restrictions are no more restrictive than those contained in the
documentation governing the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded.
Section 4.09. Incurrence of Indebtedness and Issuance of Preferred Stock.
The Company shall not, and shall not permit any of its Subsidiaries or Joint
Ventures to, directly or indirectly, create, incur, issue, assume, guaranty or
otherwise become directly or indirectly liable, contingently or otherwise, with
respect to (collectively, "incur") any Indebtedness (including, without
limitation, Acquired Indebtedness) and that the Company will not issue any
Disqualified Stock and will not permit any of its Subsidiaries or Joint Ventures
to issue any shares of Preferred Stock; provided that the Company may incur
Indebtedness (including Acquired Indebtedness) or issue shares of Disqualified
Stock if the Company's Consolidated Leverage Ratio as of the last day of the
Company's most recently ended fiscal quarter for which internal financial
statements are available immediately preceding the date on which such
Indebtedness is incurred, or such Disqualified Stock is issued, as the case may
be, would have been (a) greater than zero and less than 5.5 to 1.0, if such
incurrence or issuance is on or prior to March 31, 1999, and (b) greater than
zero and less than 5.0 to 1.0, if such incurrence or issuance is after March 31,
1999, determined on a pro forma basis (including pro forma application of the
net proceeds therefrom) as if such Indebtedness had been incurred, or such
Disqualified Stock had been issued, as the case may be, at the beginning of such
fiscal quarter.
The foregoing provisions shall not apply to:
(i) the incurrence of Indebtedness by the Company, any Subsidiary
(other than a General Partner Subsidiary) or any Permitted Joint
Venture pursuant to Credit Agreement(s), provided that the
aggregate principal amount of such Credit Agreement(s) at any one
time outstanding under this clause (i) does not exceed $50.0
million for the Company, all of its Subsidiaries (other than a
General Partner Subsidiary) and all of its Permitted Joint
Ventures combined;
(ii) the incurrence of Vendor Debt by the Company, any Subsidiary
(other than a General Partner Subsidiary) or any Permitted Joint
Venture, provided that the aggregate principal amount of such
Vendor Debt does not exceed 80% of the purchase price or cost of
the construction, acquisition or improvement of the applicable
Telecommunications Related Assets;
(iii) Refinancing Indebtedness;
(iv) the incurrence of Indebtedness by the Company not to exceed, at
any one time outstanding, 2.0 times the net cash proceeds
received by the Company from the issuance and sale of its Capital
Stock (other than Disqualified Stock) to a Person other than a
Subsidiary or a Joint
Venture of the Company, provided that such Indebtedness (y) does
not mature prior to the Stated Maturity of the Senior Notes and
has a Weighted Average Life to Maturity longer than the Senior
Notes and (z) is subordinated to the Senior Notes;
(v) the incurrence by the Company of Indebtedness (in addition to
Indebtedness permitted by any other clause of this paragraph) in
an aggregate principal amount (or accreted value, as applicable)
at any time outstanding not to exceed $10.0 million;
(vi) the incurrence by any Restricted Joint Venture of Non-Recourse
Debt, provided that if any Non-Recourse Debt of a Restricted
Joint Venture ceases to be Non-Recourse Debt, such event shall be
deemed to constitute an incurrence of Indebtedness as of the date
such Indebtedness ceases to be Non-Recourse Debt;
(vii) the guarantee of Indebtedness by a General Partner Subsidiary in
connection with the incurrence of Indebtedness by the Restricted
Joint Venture of which such General Partner Subsidiary is a
general partner;
(viii) the incurrence by the Company's Subsidiaries (other than General
Partner Subsidiaries) and Permitted Joint Ventures of
Indebtedness (including Acquired Indebtedness) so long as all of
the net proceeds of such incurrence are used by such Subsidiary
or Permitted Joint Venture, as the case may be, directly in
connection with the design, construction, development or
acquisition of a Telecommunications Service Market; provided
that, as of the last day of the Company's most recently ended
fiscal quarter for which internal financial statements are
available immediately preceding the date on which such
Indebtedness is incurred, either: (a) the aggregate principal
amount of all Indebtedness of such Subsidiary or such Permitted
Joint Venture does not exceed 1.75 times the Invested Equity
Capital of such Subsidiary or such Permitted Joint Venture; or
(b) the Consolidated Leverage Ratio of such Subsidiary or such
Permitted Joint Venture would not have been greater than 3.5 to
1.0, in each case determined on a pro forma basis (including pro
forma application of the net proceeds therefrom) as if such
Indebtedness had been incurred at the beginning of such fiscal
quarter; provided, further that any Indebtedness incurred by any
Subsidiary of the Company or any Permitted Joint Venture (other
than Related Networks) pursuant to this clause (viii) shall be
non-recourse with respect to the Company or any other Subsidiary
of the Company or any other Joint Venture; and
(ix) the incurrence by the Company of the Existing Indebtedness.
For purposes of this Section 4.09, in the event that the Company proposes to
incur Indebtedness pursuant to clause (iv) above, the Company shall,
simultaneously with the incurrence of such Indebtedness, deliver to the Trustee
a resolution of the Board of Directors set forth in an Officers' Certificate
stating that the sale or sales
of Capital Stock forming the basis for the incurrence of such Indebtedness (i)
constitutes a long term investment in the Company and (ii) has not been made for
the purpose of circumventing this Section 4.09. In the event that the Company
rescinds, reverses or unwinds such sale of Capital Stock or otherwise returns or
refunds all or any portion of the net cash proceeds of such sale of Capital
Stock (whether by dividend, distribution or otherwise) within 270 days of the
date of the incurrence of such Indebtedness, such Indebtedness will be deemed to
be incurred on the date of, and immediately after giving effect to, such
rescission, reversal, unwinding, return or refund.
For purposes of this Section 4.09, in the event that a Restricted Joint
Venture becomes a Permitted Joint Venture or otherwise ceases to be a Restricted
Joint Venture, all of the then outstanding Indebtedness of such entity shall be
deemed to have been incurred as of the date that such Restricted Joint Venture
becomes a Permitted Joint Venture or otherwise ceases to be a Restricted Joint
Venture.
Section 4.10. Asset Sales.
The Company shall not, and shall not permit any Subsidiary to, directly or
indirectly, whether in a single transaction or a series of related transactions
occurring within any twelve-month period, make any Asset Sale, unless:
(i) the Company or the Subsidiary, as the case may be, receives
consideration at the time of such Asset Sale at least equal to
the fair market value (as determined in good faith by the Board
of Directors) for the shares or assets sold or otherwise disposed
of; and
(ii) at least 90% of such consideration consists of cash, provided
that
(A) an amount equal to the fair market value (as determined in good
faith by the Board of Directors) of:
(1) Telecommunications Related Assets received by the Company or
any Subsidiary from the transferee that will be used by the
Company or such Subsidiary in the operation of a
Telecommunications Business;
(2) the Voting Stock of any Person engaged in a Telecommunications
Business received by the Company or any Subsidiary; provided
that on the date such Voting Stock is received, such Investment
in Voting Stock constitutes a Permitted Joint Venture
Investment; or
(3) the publicly tradeable Voting Stock of any person engaged in
the Telecommunications Business received by the Company or any
Subsidiary as consideration for a sale of an Equity Interest in
any Restricted Joint Venture,
shall, for the purposes of this Section 4.10, be deemed to be cash which
was applied in accordance with the first sentence of the penultimate
paragraph of this Section 4.10; and
(B) in the event that any of Hyperion Telecommunications of
Pennsylvania, Inc., Hyperion Telecommunications of Tennessee, Inc.
or Hyperion Telecommunications of New York, Inc. sell their
respective partnership interests in the partnerships to which each
is a partner to the respective partnerships in the manner specified
by the applicable partnership agreement, (1) the principal amount of
any seller note issued to the Company or any of its Wholly Owned
Subsidiaries shall be deemed to be cash for purposes of this Section
4.10 and (2) the payments of principal pursuant to such seller note
shall be deemed to be Net Cash Proceeds (for purposes of the
penultimate paragraph of this Section 4.10) as and when such
payments are received.
For purposes of this Section 4.10, the first $1.0 million of Net Cash
Proceeds received from Asset Sales in any fiscal year shall not be subject to
the restrictions contained in this section.
In determining the fair market value with respect to any Asset Sale or
series of related Asset Sales involving aggregate consideration in excess of
$10.0 million, the Board of Directors of the Company must obtain an opinion as
to the fairness to the Holders of Senior Notes of such Asset Sales from a
financial point of view issued by a nationally recognized investment banking
firm with total assets in excess of $1.0 billion; provided that no such opinion
shall be required if such Asset Sale is in accordance with the terms of any
Local Partnership Agreement to which the Company or any of its Subsidiaries is a
party on the date hereof.
The Company may apply the Net Cash Proceeds from any Asset Sale to an
investment in Telecommunications Related Assets in a Telecommunications Service
Market within 180 days after such Asset Sale; provided that if the Company
determines to make such investment in a New Telecommunications Service Market,
the Company shall be deemed to have complied with the first clause of this
sentence if, the Company (y) within 180 days of such Asset Sale, delivers to the
Trustee a resolution adopted by a majority of the Board of Directors set forth
in an Officer's Certificate certifying that the Company intends to utilize the
Net Cash Proceeds of such Asset Sale to invest in a specific new
Telecommunications Service Market and (z) completes such investment within 360
days of such Asset Sale. The Company shall be deemed to have completed its
investment for purposes of the preceding clause (z), so long as the Company has
(i) a business plan that sets forth the Company's investment plans for the
applicable Telecommunications Service Market and (ii) issued all material
purchase orders to the appropriate parties that are necessary to complete such
business plan. Any Net Cash Proceeds from an Asset Sale that are not invested
as provided in the two preceding sentences shall constitute Excess Proceeds.
When the aggregate amount of Excess Proceeds exceeds $2.5 million, the Company
shall commence an Asset Sale Offer to purchase the maximum principal amount of
Senior Notes that may be purchased out of the Excess Proceeds, at an offer price
in cash equal to 100% of aggregate principal amount thereof, plus accrued and
unpaid interest to the date of repurchase (or, in the case of repurchases of
Senior Notes prior to April 15, 2001, at a purchase price equal to 100% of the
Accreted Value thereof as of the date of repurchase) in accordance with the
procedures set forth in this Indenture. To the extent that the aggregate
principal amount thereof, plus accrued and unpaid interest to the date of
repurchase (or, in the
case of repurchases of Senior Notes prior to April 15, 2001, the Accreted Value
thereof as of the date of repurchase) of the Senior Notes tendered pursuant to
an Asset Sale Offer is less than the Excess Proceeds, the Company may use such
remaining Excess Proceeds for any purpose not prohibited by this Indenture. If
the aggregate principal amount thereof, plus accrued and unpaid interest to the
date of repurchase (or, in the case of repurchases of Senior Notes prior to
April 15, 2001, the Accreted Value thereof as of the date of repurchase) of
Senior Notes surrendered by Holders thereof exceeds the amount of Excess
Proceeds, the Trustee shall select the Senior Notes to be purchased on a pro
rata basis. Upon completion of such offer, the amount of Excess Proceeds shall
be reset at zero. Pending application of the Net Cash Proceeds as set forth
above from Asset Sales, all such Net Cash Proceeds shall be placed in escrow for
the benefit of the Holders of Senior Notes.
Notwithstanding the foregoing, the Company shall not, and shall not permit
any Subsidiary to, directly or indirectly, make any Asset Sale of any Equity
Interests of any Subsidiary (at least 80% of the voting power of the Capital
Stock of which is owned by the Company) except pursuant to an Asset Sale of all
of the Equity Interests of such Subsidiary; provided that any sale of any Equity
Interest of any such Subsidiary to a Strategic Investor shall be deemed not to
be an Asset Sale for purposes of this Section 4.10, so long as such sale of such
Equity Interests does not result in such Subsidiary ceasing to be a Subsidiary
of the Company.
Section 4.11. Transactions with Affiliates.
The Company shall not, and shall not permit any of its Subsidiaries to, make
any payment to, or sell, lease, transfer or otherwise dispose of any of its
properties or assets to, or purchase any property or assets from, or enter into
or make or amend any contract, agreement, understanding, loan, advance or
guarantee with, or for the benefit of, any Affiliate (each of the foregoing, an
"Affiliate Transaction"), unless
(i) such Affiliate Transaction is on terms that are no less favorable to
the Company or the relevant Subsidiary, other than those that would have
been obtained in a comparable transaction by the Company or such
Subsidiary with an unrelated Person; and
(ii) the Company delivers to the Trustee (a) with respect to any
Affiliate Transaction or series of related Affiliate Transactions
involving aggregate consideration in excess of $1.0 million, a resolution
adopted by a majority of the disinterested members of the Board of
Directors and a majority of the Independent Directors of the Company set
forth in an Officers' Certificate certifying that such Affiliate
Transaction complies with clause (i) above; and (b) with respect to any
Affiliate Transaction or series of related Affiliate Transactions
involving aggregate consideration in excess of $10.0 million, an opinion
as to the fairness to the Holders of Senior Notes of such Affiliate
Transaction from a financial point of view issued by
a nationally recognized consulting firm, business valuation firm or
investment banking firm;
provided that: (i) all agreements and arrangements with Affiliates, including
without limitation the Local Partner Agreements, the Fiber Lease Agreements, the
Management Agreements, network monitoring agreements and transactions in
connection therewith or pursuant thereto existing on the date of this Indenture
and through the current term thereof; (ii) all arrangements and transactions
with Adelphia, including existing intercompany Indebtedness, overhead charges
made in the ordinary course of business, fiber lease arrangements and similar
services existing on the date of this Indenture and through the current term
thereof; (iii) all employment arrangements approved by the Board of Directors;
(iv) all restricted Payments made pursuant to the Section 4.07 hereof; (v)
transactions between or among the Company and/or its Wholly Owned Subsidiaries;
(vi) transactions between a General Partner Subsidiary and the Restricted Joint
Venture of which such General Partner Subsidiary is a general partner; and (vii)
management and network monitoring agreements between the Company and any of its
Joint Ventures, shall not be deemed Affiliate Transactions.
Section 4.12. Liens.
The Company shall not, and shall not permit any of its Subsidiaries or
Permitted Joint Ventures to, directly or indirectly, create, incur, assume or
suffer to exist any Lien on any asset now owned or hereafter acquired, or any
income or profits therefrom or assign or convey any right to receive income
therefrom, except Permitted Liens.
Section 4.13. Line of Business.
The Company shall not, and shall not permit any of its Subsidiaries to,
engage in any business other than Telecommunications Business and such business
activities as are incidental or related thereto.
Section 4.14. Corporate Existence.
Subject to Article 5 hereof, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) its corporate
existence, and the corporate, partnership or other existence of each of its
Subsidiaries, in accordance with the respective organizational documents (as the
same may be amended from time to time) of the Company or any such Subsidiary and
(ii) the rights (charter and statutory), licenses and franchises of the Company
and its 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 Subsidiaries, if the Board of Directors shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company and its Subsidiaries, taken as a whole, and that the
loss thereof is not adverse in any material respect to the Holders of the Senior
Notes.
Section 4.15. Offer to Purchase Upon Change of Control.
(a) Upon the occurrence of a Change of Control, the Company shall make an
offer (the "Change of Control Offer") to each holder of Senior Notes to
repurchase all or any part (equal to $1,000 or an integral multiple thereof) of
such Holder's Senior Notes at a purchase price equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest and Liquidated
Damages, if any, to the date of repurchase (or, in the case of repurchases of
Senior Notes prior to April 15, 2001, at a purchase price equal to 101% of the
Accreted Value thereof as of the date of repurchase) (in either case, the
"Change of Control Payment"). Within ten days following any Change of Control,
the Company shall mail a notice to each Holder stating: (1) that the Change of
Control Offer is being made pursuant to this Section 4.15 and that all Senior
Notes tendered will be accepted for payment; (2) the purchase price and the
purchase date, which shall be no later than 30 business days from the date such
notice is mailed (the "Change of Control Payment Date"); (3) that any Senior
Note not tendered will continue to accrete or accrue interest; (4) that, unless
the Company defaults in the payment of the Change of Control Payment, all Senior
Notes accepted for payment pursuant to the Change of Control Offer shall cease
to accrete or accrue interest after the Change of Control Payment Date; (5) that
Holders electing to have any Senior Notes purchased pursuant to a Change of
Control Offer will be required to surrender the Senior Notes, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Senior Notes
completed, to the Paying Agent at the address specified in the notice prior to
the close of business on the third Business Day preceding the Change of Control
Payment Date; (6) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business on the second
Business Day preceding the Change of Control Payment Date, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of Senior Notes delivered for purchase, and a statement that
such Holder is withdrawing his election to have the Senior Notes purchased; and
(7) that Holders whose Senior Notes are being purchased only in part will be
issued new Senior Notes equal in principal amount to the unpurchased portion of
the Senior Notes surrendered, which unpurchased portion must be equal to $1,000
in principal amount or an integral multiple thereof. The Company shall comply
with the requirements of Rule 14e-1 under the Exchange Act and any other
securities laws and regulations thereunder to the extent such laws and
regulations are applicable in connection with the repurchase of Senior Notes in
connection with a Change of Control.
(b) On the Change of Control Payment Date, the Company shall, to the extent
lawful, (1) accept for payment all Senior Notes or portions thereof properly
tendered pursuant to the Change of Control Offer, (2) deposit with the Paying
Agent an amount equal to the Change of Control Payment in respect of all Senior
Notes or portions thereof so tendered and (3) deliver or cause to be delivered
to the Trustee the Senior Notes so accepted together with an Officers'
Certificate stating the aggregate principal amount of Senior Notes or portions
thereof being purchased by the Company. The Paying Agent shall promptly mail to
each Holder of Senior Notes so tendered payment in an amount equal to the
purchase price for the Senior Notes, and the Trustee shall promptly authenticate
and mail (or cause to be transferred by book entry) to each Holder a new Senior
Note equal in principal amount to any unpurchased portion of the Senior Notes
surrendered by such Holder, if any; provided, that each such new Senior Note
shall be in a principal amount of $1,000 or an integral multiple thereof. The
Company shall publicly announce the results of the Change of Control Offer on or
as soon as practicable after the Change of Control Payment Date.
Section 4.16. Limitations on Sale and Leaseback Transactions.
The Company shall not, and shall not permit any of its Subsidiaries to,
enter into any Sale and Leaseback Transaction; provided that the Company or any
Subsidiary (other than a General Partner Subsidiary) may enter into a Sale and
Leaseback Transaction if (i) the Company or other entity could have incurred the
Indebtedness relating to such Sale and Leaseback Transaction pursuant to
Sections 4.09 and 4.12 hereof to incur secured Indebtedness in an amount equal
to the Attributable Debt with respect to such transaction, (ii) the net proceeds
of such Sale and Leaseback Transaction are at least equal to the fair market
value of such property as determined in good faith by the Board of Directors of
the Company and (iii) such proceeds are applied in accordance with the Section
4.10 hereof.
Section 4.17. Loans to Subsidiaries and Joint Ventures.
All loans to Subsidiaries or Joint Ventures made by the Company from time to
time after the date of this Indenture shall be evidenced by Intercompany Notes
in favor of the Company. All loans (unless secured on the date hereof) by the
Company to any Subsidiary or Joint Venture outstanding on the date hereof shall
be evidenced by an unsecured Intercompany Note. The Company shall not, and
shall not permit any of its Subsidiaries to, make any loans by Subsidiaries to
other Subsidiaries and by Subsidiaries to Joint Ventures in which such
Subsidiary does not have an Equity Interest, except that such loans may be (i)
incurred and maintained between and among the Company, its Subsidiaries and
Joint Permitted Ventures in connection with the incurrence of Indebtedness
pursuant to clause (i) of Section 4.09 hereof or (ii) incurred and maintained
between and among Related Networks in connection with the incurrence of
Indebtedness by such Related Networks pursuant to the proviso in clause (viii)
of Section 4.09 hereof. A form of Intercompany Note is attached as an annex
hereto.
Section 4.18. Limitation on Status as Investment Company.
The Company shall not, and shall not permit any of its Subsidiaries to,
conduct its business in a fashion that would cause it to be required to register
as an "investment company" (as that term is defined in the Investment Company
Act of 1940, as amended) or otherwise become subject to regulation under the
Investment Company Act of 1940.
Section 4.19. Payments for Consent.
Neither the Company nor any of its Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any holder of any Senior Notes for or as
inducement to any consent, waiver or amendment of any terms or provisions or the
Senior Notes unless such consideration is offered to be paid or agreed to be
paid to all Holders of Senior Notes which so consent,
waive or agree to amend in the time frame set forth in solicitation documents
relating to such consent, waiver or agreement.
Section 4.20. Independent Directors.
The Company shall, no later than 360 days from the date hereof, have at
least two members of its Board of Directors who are neither officers nor
employees of the Company or its Affiliates (the "Independent Directors"). Any
transaction requiring the approval of the majority of the Independent Directors
shall be prohibited at any time that there are not at least two Independent
Directors on the Company's Board of Directors. If the Company fails to comply
with this Section 4.20, the Company shall pay Liquidated Damages to each Holder
of the Senior Notes (i) with respect to the first 90-day period immediately
following the occurrence of such default at a rate of 0.5% per annum, determined
daily, on the Accreted Value of the Senior Notes (or after April 15, 2001, on
the principal amount of the Senior Notes) and (ii) at the beginning of each
subsequent 90-day period at a rate increased by an additional 0.25% per annum up
to a maximum aggregate increase of 2.0% per annum until such default has been
cured.
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Assets.
The Company shall not consolidate or merge with or into (whether or not the
Company is the surviving corporation), or sell, assign, transfer, lease, convey
or otherwise dispose of all or substantially all of its properties or assets in
one or more related transactions, to another corporation, Person or entity
unless (i) the Company is the surviving corporation or the entity or the Person
formed by or surviving any such consolidation or merger (if other than the
Company) or to which such sale, assignment, transfer, lease, conveyance or other
disposition shall have been made is a corporation organized or existing under
the laws of the United States, any state thereof or the District of Columbia;
(ii) the entity or Person formed by or surviving any such consolidation or
merger (if other than the Company) or the entity or Person to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made assumes all the obligations of the Company under the Senior Notes and the
Indenture pursuant to a supplemental indenture in a form reasonably satisfactory
to the Trustee; (iii) immediately after such transaction no Default or Event of
Default exists; and (iv) except in the case of a merger of the Company with or
into a Wholly Owned Subsidiary of the Company, the Company or the entity or
Person formed by or surviving any such consolidation or merger (if other than
the Company), or to which such sale, assignment, transfer, lease, conveyance or
other disposition shall have been made (A) will have Consolidated Net Worth
immediately after the transaction equal to or greater than the Consolidated Net
Worth of the Company immediately preceding the transaction and (B) will, at the
time of such transaction and after giving pro forma effect thereto as if such
transaction had occurred at the beginning of the applicable four-quarter period,
be permitted to incur at least $1.00 of additional Indebtedness (other than
Permitted Indebtedness) pursuant to Section 4.09 hereof.
Section 5.02. Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, assignment, transfer, lease,
conveyance or other disposition of all or substantially all of the assets of the
Company in accordance with Section 5.01 hereof, the successor corporation formed
by such consolidation or into or with which the Company is merged or to which
such sale, assignment, transfer, lease, conveyance or other disposition is made
shall succeed to, and be substituted for (so that from and after the date of
such consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" shall refer instead to
the successor corporation and not to the Company), and may exercise every right
and power of the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; provided, however, that
the predecessor Company shall not be relieved from the obligation to pay the
principal of and interest on the Senior Notes except in the case of a sale of
all of the Company's assets that meets the requirements of Section 5.01 hereof.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
An "Event of Default" occurs if:
(a) the Company defaults in the payment when due of interest on, or
Liquidated Damages with respect to, the Senior Notes and such default
continues for a period of 30 days;
(b) the Company defaults in the payment when due of principal of or
premium, if any, on the Senior Notes when the same becomes due and
payable at maturity, upon redemption (including in connection with an
offer to purchase) or otherwise;
(c) the Company fails to comply with any of the provisions of Section
4.07, 4.10, 4.15 or 5.01 hereof;
(d) the Company fails to comply with the provisions described under
Section 4.09; provided that, for purposes of the last paragraph of
Section 4.09, in the event that the Company fails to comply with such
section because Indebtedness is deemed to be incurred by a Restricted
Joint Venture solely as a result of such Restricted Joint Venture
ceasing to be a Restricted Joint Venture as a result of (i) the loss of
a Local Partner or (ii) the loss of management control of such
Restricted Joint Venture, such failure continues for 90 days;
(e) the Company fails to observe or perform any other covenant,
representation, warranty or other agreement in this Indenture or the
Senior Notes
for 30 days after notice to the Company by the Trustee or the Holders
of at least 25% in principal amount of the Senior Notes then
outstanding;
(f) default occurs under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced
any Indebtedness for money borrowed by the Company or any of its
Subsidiaries (or the payment of which is guaranteed by the Company or
any of its Subsidiaries) whether such Indebtedness or guarantee now
exists, or is created after the date of the Indenture, which default
(a) is caused by a failure to pay principal of or premium, if any, or
interest on such Indebtedness prior to the expiration of the grace
period provided in such Indebtedness on the date of such default (a
"Payment Default") or (b) results in the acceleration of such
Indebtedness prior to its express maturity and, in each case, the
principal amount of any such Indebtedness, together with the principal
amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated,
aggregates $5.0 million or more;
(g) a final judgment or final judgments for the payment of money are
entered by a court or courts of competent jurisdiction against the
Company or any of its Subsidiaries or any group of Subsidiaries that,
taken as a whole, would constitute a Subsidiary and such judgment or
judgments are not paid within, discharged by or stayed for a period of
60 days, provided that the aggregate of all such undischarged judgments
exceeds $5.0 million;
(h) the Company or any of its Significant Subsidiaries or any of its
Joint Ventures that would, if it were a Subsidiary constitute a
Significant Subsidiary, or any group of Subsidiaries or Joint Ventures
that, taken as a whole, would constitute a Significant Subsidiary
pursuant to or within the meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in an
involuntary case,
(iii) consents to the appointment of a Custodian of it or for
all or substantially all of its property,
(iv) makes a general assignment for the benefit of its creditors,
or
(v) generally is not paying its debts as they become due; or
(i) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(i) is for relief against the Company or any of its Significant
Subsidiaries or any of its Joint Ventures that would, if it were a
Subsidiary constitute a Significant Subsidiary, or any group of
Subsidiaries or Joint
Ventures that, taken as a whole, would constitute a Significant
Subsidiary in an involuntary case;
(ii) appoints a Custodian of the Company or any of its Significant
Subsidiaries or any of its Joint Ventures that would, if it were a
Subsidiary constitute a Significant Subsidiary, or any group of
Subsidiaries or Joint Ventures that, taken as a whole, would
constitute a Significant Subsidiary or for all or substantially all
of the property of the Company or any of its Significant
Subsidiaries or any of its Joint Ventures that would, if it were a
Subsidiary constitute a Significant Subsidiary, or any group of
Subsidiaries or Joint Ventures that, taken as a whole, would
constitute a Significant Subsidiary; or
(iii) orders the liquidation of the Company or any of its
Significant Subsidiaries or any of its Joint Ventures that would, if
it were a Subsidiary constitute a Significant Subsidiary, or any
group of Subsidiaries or Joint Ventures that, taken as a whole,
would constitute a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60
consecutive days.
Section 6.02. Acceleration.
If any Event of Default (other than an Event of Default specified in clause
(h) or (i) of Section 6.01 hereof with respect to the Company, any Significant
Subsidiary or any of its Joint Ventures that would, if it were a Subsidiary
constitute a Significant Subsidiary, or any group of Subsidiaries or Joint
Ventures that, taken as a whole, would constitute a Significant Subsidiary)
occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Senior Notes may declare all the Senior
Notes to be due and payable immediately; upon any such declaration, the Senior
Notes shall become due and payable immediately. Notwithstanding the foregoing,
if an Event of Default specified in clause (h) or (i) of Section 6.01 hereof
occurs with respect to the Company, any of its Significant Subsidiaries or any
of its Joint Ventures that would, if it were a Subsidiary constitute a
Significant Subsidiary, or any group of Subsidiaries or Joint Ventures that,
taken as a whole, would constitute a Significant Subsidiary, all outstanding
Senior Notes shall be due and payable immediately without further action or
notice. Holders of the Senior Notes may not enforce this Indenture or the
Senior Notes except as provided in this Indenture. The Holders of a majority in
aggregate principal amount of the then outstanding Senior Notes by written
notice to the Trustee may on behalf of all of the Holders rescind an
acceleration and its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default (except nonpayment of
principal, interest or premium that has become due solely because of the
acceleration) have been cured or waived.
In the case of any Event of Default occurring by reason of any willful
action (or inaction) taken (or not taken) by or on behalf of the Company with
the intention of avoiding payment of the premium that the Company would have had
to pay if the Company then had elected to redeem the Senior Notes pursuant to
Section 3.07 hereof, an equivalent premium shall also become and be immediately
due and payable to the
extent permitted by law upon the acceleration of the Senior Notes. If an Event
of Default occurs prior to April 15, 2001 by reason of any willful action (or
inaction) taken (or not taken) by or on behalf of the Company with the intention
of avoiding the prohibition of redemption of the Senior Notes prior to April 15,
2001, then the premium payable for purposes of this paragraph for the period
beginning of the date hereof and ending on April 14, 2001 shall be 106.5% of the
amount that would otherwise be due but for the provisions of this paragraph,
plus accrued interest, if any, to the date of payment. the
The Company is required to deliver to the Trustee annually a statement
regarding compliance with the Indenture, and the Company is required upon
becoming aware of any Default or Event of Default, to deliver to the Trustee a
statement specifying such Default or Event of Default.
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the payment of principal, premium, if any, and
interest on the Senior Notes or to enforce the performance of any provision of
the Senior Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of the
Senior Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder of a Senior Note in exercising any right
or remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. All remedies
are cumulative to the extent permitted by law.
Section 6.04. Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount of the
then outstanding Senior Notes by notice to the Trustee may on behalf of the
Holders of all of the Senior Notes waive an existing Default or Event of Default
and its consequences hereunder, except a continuing Default or Event of Default
in the payment of the principal of, premium and Liquidated Damages, if any, or
interest on, the Senior Notes (including in connection with an offer to
purchase) (provided, however, that the Holders of a majority in aggregate
principal amount of the then outstanding Senior Notes may rescind an
acceleration and its consequences, including any related payment default that
resulted from such acceleration in accordance with Section 6.02 hereof). Upon
any such waiver, such Default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been cured for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.
Section 6.05. Control by Majority.
Holders of a majority in principal amount of the then outstanding Senior
Notes may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or power
conferred on it.
However, the Trustee may refuse to follow any direction that conflicts with law
or this Indenture that the Trustee determines may be unduly prejudicial to the
rights of other Holders of Senior Notes or that may involve the Trustee in
personal liability.
Section 6.06. Limitation on Suits.
A Holder of a Senior Note may pursue a remedy with respect to this Indenture
or the Senior Notes only if:
(a) the Holder of a Senior Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Senior Notes make a written request to the Trustee to pursue
the remedy;
(c) such Holder of a Senior Note or Holders of Senior Notes offer and,
if requested, provide to the Trustee indemnity satisfactory to the Trustee
against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Senior Notes do not give the Trustee a
direction inconsistent with the request.
A Holder of a Senior Note may not use this Indenture to prejudice the rights of
another Holder of a Senior Note or to obtain a preference or priority over
another Holder of a Senior Note.
Section 6.07. Rights of Holders of Senior Notes to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Senior Note to receive payment of principal, premium and Liquidated
Damages, if any, and interest on the Senior Note, on or after the respective due
dates expressed in the Senior Note (including in connection with an offer to
purchase), or to bring suit for the enforcement of any such payment on or after
such respective dates, shall not be impaired or affected without the consent of
such Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(a) or (b) occurs and is
continuing, the Trustee is authorized to recover judgment in its own name and as
trustee of an express trust against the Company for the whole amount of
principal of, premium and Liquidated Damages, if any, and interest remaining
unpaid on the Senior Notes and interest on overdue principal and, to the extent
lawful, interest and such further amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
Section 6.09. Trustee May File Proofs of Claim.
The Trustee is authorized to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Senior Notes allowed in any judicial proceedings relative to the
Company (or any other obligor upon the Senior Notes), its creditors or its
property and shall be entitled and empowered to collect, receive and distribute
any money or other property payable or deliverable on any such claims and any
custodian in any such judicial proceeding is hereby authorized by each Holder to
make such payments to the Trustee, and in the event that the Trustee shall
consent to the making of such payments directly to the Holders, to pay to the
Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.07 hereof. To the extent that the
payment of any such compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof out of the estate in any such proceeding, shall be denied
for any reason, payment of the same shall be secured by a Lien on, and shall be
paid out of, any and all distributions, dividends, money, securities and other
properties that the Holders may be entitled to receive in such proceeding
whether in liquidation or under any plan of reorganization or arrangement or
otherwise. Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Senior
Notes or the rights of any Holder, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article, it shall pay out
the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07 hereof, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders of Senior Notes for amounts due and unpaid on the Senior
Notes for principal, premium and Liquidated Damages, if any, and interest,
ratably, without preference or priority of any kind, according to the amounts
due and payable on the Senior Notes for principal, premium and Liquidated
Damages, if any and interest, respectively; and
Third: to the Company or to such party as a court of competent jurisdiction
shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Senior Notes pursuant to this Section 6.10.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as a
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section does
not apply to a suit by the Trustee, a suit by a Holder of a Senior Note pursuant
to Section 6.07 hereof, or a suit by Holders of more than 10% in principal
amount of the then outstanding Senior Notes.
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the Trustee shall
exercise such of the rights and powers vested in it by this Indenture, and use
the same degree of care and skill in its exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the express
provisions of this Indenture and the Trustee need perform only those
duties that are specifically set forth in this Indenture and no others,
and no implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture.
However, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
(c) The Trustee may not be relieved from liabilities for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section;
(ii) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it is proved that the Trustee
was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every provision of this
Indenture that in any way relates to the Trustee is subject to paragraphs (a),
(b) and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability or
expense.
(f) The Trustee shall not be liable for interest on any money received by it
except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
Section 7.02. Rights of Trustee.
(a) The Trustee may conclusively rely upon any document believed by it to be
genuine and to have been signed or presented by the proper Person. The Trustee
need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel and the written advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection from liability in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action it takes or omits to take
in good faith that it believes to be authorized or within the rights or powers
conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any demand,
request, direction or notice from the Company shall be sufficient if signed by
an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities that might be
incurred by it in compliance with such request or direction.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner or
pledgee of Senior Notes and may otherwise deal with the Company or any Affiliate
of the Company with the same rights it would have if it were not Trustee.
However, in the event that the Trustee acquires any conflicting interest it must
eliminate such conflict within 90 days, apply to the SEC for permission to
continue as trustee or resign. Any Agent may do the same with like rights and
duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof.
Section 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation as to
the validity or adequacy of this Indenture or the Senior Notes, it shall not be
accountable for the Company's use of the proceeds from the Senior Notes or any
money paid to the Company or upon the Company's direction under any provision of
this Indenture, it shall not be responsible for the use or application of any
money received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Senior
Notes or any other document in connection with the sale of the Senior Notes or
pursuant to this Indenture other than its certificate of authentication.
Section 7.05. Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it is known
to the Trustee, the Trustee shall mail to Holders of Senior Notes a notice of
the Default or Event of Default within 90 days after it occurs. Except in the
case of a Default or Event of Default in payment of principal of, premium, if
any, or interest on any Senior Note, the Trustee may withhold the notice if and
so long as a committee of its Responsible Officers in good faith determines that
withholding the notice is in the interests of the Holders of the Senior Notes.
Section 7.06. Reports by Trustee to Holders of the Senior Notes.
Within 60 days after each May 15 beginning with the May 15 following the
date of this Indenture, and for so long as Senior Notes remain outstanding, the
Trustee shall mail to the Holders of the Senior Notes a brief report dated as of
such reporting date that complies with TIA (S) 313(a) (but if no event described
in TIA (S) 313(a) has occurred within the twelve months preceding the reporting
date, no report need be transmitted). The Trustee also shall comply with TIA
(S) 313(b)(2). The Trustee shall also transmit by mail all reports as required
by TIA (S) 313(c).
A copy of each report at the time of its mailing to the Holders of Senior
Notes shall be mailed to the Company and filed with the SEC and each stock
exchange on which the Senior Notes are listed in accordance with TIA (S) 313(d).
The Company shall promptly notify the Trustee when the Senior Notes are listed
on any stock exchange.
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. To
the extent permitted by law, the Trustee's compensation shall not be limited by
any law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee promptly upon request for all reasonable disbursements,
advances and expenses incurred or made by it in addition to the compensation for
its services. Such expenses shall include the reasonable compensation,
disbursements and expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Indenture, including the
costs and expenses of enforcing this Indenture against the Company (including
this Section 7.07) and defending itself against any claim (whether asserted by
the Company or any Holder or any other person) or liability in connection with
the exercise or performance of any of its powers or duties hereunder, except to
the extent any such loss, liability or expense may be attributable to its
negligence or bad faith. The Trustee shall notify the Company promptly of any
claim for which it may seek indemnity. Failure by the Trustee to so notify the
Company shall not relieve the Company of its obligations hereunder. The Company
shall defend the claim and the Trustee shall cooperate in the defense. The
Trustee may have separate counsel and the Company shall pay the reasonable fees
and expenses of such counsel. The Company need not pay for any settlement made
without its consent, which consent shall not be unreasonably withheld.
The obligations of the Company under this Section 7.07 shall survive the
satisfaction and discharge of this Indenture.
To secure the Company's payment obligations in this Section, the Trustee
shall have a Lien prior to the Senior Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal and
interest on particular Senior Notes. Such Lien shall survive the satisfaction
and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(g) or (h) hereof occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
The Trustee shall comply with the provisions of TIA (S) 313(b)(2) to the
extent applicable.
Section 7.08. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section.
The Trustee may resign in writing at any time and be discharged from the
trust hereby created by so notifying the Company. The Holders of Senior Notes
of a majority in principal amount of the then outstanding Senior Notes may
remove the Trustee by so notifying the Trustee and the Company in writing. The
Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a Custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office of
Trustee for any reason, the Company shall promptly appoint a successor Trustee.
Within one year after the successor Trustee takes office, the Holders of a
majority in principal amount of the then outstanding Senior Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of Senior Notes of at least 10% in principal amount of the then
outstanding Senior Notes may petition any court of competent jurisdiction for
the appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Senior Note who has
been a Holder of a Senior Note for at least six months, fails to comply with
Section 7.10, such Holder of a Senior Note may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.
A successor Trustee shall deliver a written acceptance of its appointment to
the retiring Trustee and to the Company. Thereupon, the resignation or removal
of the retiring Trustee shall become effective, and the successor Trustee shall
have all the rights, powers and the duties of the Trustee under this Indenture.
The successor Trustee shall mail a notice of its succession to the Holders of
the Senior Notes. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee, provided that all sums owing to
the Trustee hereunder have been paid and subject to the Lien provided for in
Section 7.07 hereof. Notwithstanding replacement of the Trustee pursuant to
this Section 7.08, the Company's obligations under Section 7.07 hereof shall
continue for the benefit of the retiring Trustee.
Section 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities. The Trustee and its direct parent shall at all times have a
combined capital surplus of at least fifty million dollars. If such corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for
purposes of this Section 7.10 the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published.
This Indenture shall always have a Trustee who satisfies the requirements of
TIA (S) 310(a)(1), (2) and (5). The Trustee is subject to TIA (S) 310(b).
Section 7.11. Preferential Collection of Claims Against The Company.
The Trustee is subject to TIA (S) 311(a), excluding any creditor
relationship listed in TIA (S) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (S) 311(a) to the extent indicated therein.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.
The Company may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Senior Notes
upon compliance with the conditions set forth below in this Article Eight.
Section 8.02. Legal Defeasance and Discharge.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Senior Notes on
the date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal Defeasance means that the Company shall
be deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Senior Notes, which shall thereafter be deemed to be "outstanding"
only for the purposes of Section 8.05 hereof and the other Sections of this
Indenture referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Senior Notes and this Indenture (and the Trustee, on
demand of and at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (a) the rights of Holders
of outstanding Senior Notes to receive solely from the trust fund described in
Section 8.04 hereof, and
as more fully set forth in such Section, payments in respect of the principal
of, premium, if any, and interest on such Senior Notes when such payments are
due, (b) the Company's obligations with respect to such Senior Notes under
Article 2 and Section 4.02 hereof, (c) the rights, powers, trusts, duties and
immunities of the Trustee hereunder and the Company's obligations in connection
therewith and (d) this Article Eight. Subject to compliance with this Article
Eight, the Company may exercise its option under this Section 8.02
notwithstanding the prior exercise of its option under Section 8.03 hereof.
Section 8.03. Covenant Defeasance.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be released from its
obligations under the covenants contained in Sections 4.07, 4.08, 4.09, 4.10,
4.11, 4.12, 4.13, 4.15, 4.16 and 4.17 hereof with respect to the outstanding
Senior Notes on and after the date the conditions set forth below are satisfied
(hereinafter, "Covenant Defeasance"), and the Senior Notes shall thereafter be
deemed not "outstanding" for the purposes of any direction, waiver, consent or
declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "outstanding"
for all other purposes hereunder (it being understood that such Senior Notes
shall not be deemed outstanding for accounting purposes). For this purpose,
Covenant Defeasance means that, with respect to the outstanding Senior Notes,
the Company may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.01 hereof, but,
except as specified above, the remainder of this Indenture and such Senior Notes
shall be unaffected thereby. In addition, upon the Company's exercise under
Section 8.01 hereof of the option applicable to this Section 8.03 hereof,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
Sections 6.01(d) through 6.01(g) hereof shall not constitute Events of Default.
Section 8.04. Conditions to Legal or Covenant Defeasance.
The following shall be the conditions to the application of either Section
8.02 or 8.03 hereof to the outstanding Senior Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(a) the Company must irrevocably deposit with the Trustee, in trust, for the
benefit of the Holders of the Senior Notes, cash in U.S. dollars, non-callable
Government Securities, or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of independent public
accounts, to pay the principal of, premium, if any, and interest and Liquidated
Damages, if any, on the outstanding Senior Notes on the stated maturity or on
the applicable redemption date, as the case may be, and the Company must specify
whether the Senior Notes are being defeased to maturity or to a particular
redemption date;
(b) in the case of an election under Section 8.02 hereof, the Company shall
have delivered to the Trustee an opinion of counsel in the United States
reasonably acceptable to the Trustee confirming that (A) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (B) since the date of the Indenture, there has been a change in the
applicable federal income tax law, in either case to the effect that, and based
thereon such opinion of counsel shall confirm that, the Holders of the
outstanding Senior Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Legal Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same time
as would have been the case if such Legal Defeasance had not occurred;
(c) in the case of an election under Section 8.03 hereof, the Company shall
have delivered to the Trustee an opinion of counsel in the United States
reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Senior Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Covenant Defeasance and will be subject
to federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Covenant Defeasance had not occurred;
(d) no Default or Event of Default shall have occurred and be continuing on
the date of such deposit (other than a Default or Event of Default resulting
from the incurrence of Indebtedness all or a portion of the proceeds of which
will be used to defease the Senior Notes pursuant to this Article Eight
concurrently with such incurrence) or insofar as Sections 6.01(h) and 6.01(i)
hereof are concerned, at any time in the period ending on the 91st day after the
date of deposit;
(e) such Legal Defeasance or Covenant Defeasance will not result in a breach
or violation of, or constitute a default under any material agreement or
instrument (other than this Indenture) to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its subsidiaries is
bound;
(f) the Company shall have delivered to the Trustee an opinion of counsel to
the effect that after the 91st day following the deposit, the trust funds will
not be subject to the effect of any applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally;
(g) the Company shall have delivered to the Trustee an Officers' Certificate
stating that the deposit was not made by the Company with the intent of
preferring the Holders of Senior Notes over the other creditors of the Company
with the intent of defeating, hindering, delaying or defrauding any other
creditors of the Company; and
(h) 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 the Legal Defeasance or the Covenant Defeasance have been
complied with.
Section 8.05. Deposited Money and Government Securities to be Held in Trust;
Other Miscellaneous Provisions.
Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Senior
Notes shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Senior Notes and this Indenture, to the payment, either
directly or through any Paying Agent (including the Company acting as Paying
Agent) as the Trustee may determine, to the Holders of such Senior Notes of all
sums due and to become due thereon in respect of principal, premium, if any, and
interest, but such money need not be segregated from other funds except to the
extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Senior
Notes.
Anything in this Article Eight to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the request of the
Company any money or non-callable Government Securities held by it as provided
in Section 8.04 hereof which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
8.04(a) hereof), are in excess of the amount thereof that would then be required
to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
Section 8.06. Repayment to The Company.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of, premium, if any, or
interest on any Senior Note and remaining unclaimed for two years after such
principal, and premium, if any, or interest or Liquidated Damages, if any, has
become due and payable shall be paid to the Company on its request or (if then
held by the Company) shall be discharged from such trust; and the Holder of such
Senior Note shall thereafter, as a secured creditor, look only to the Company
for payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in the New York Times and The
Wall Street Journal (national edition), notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such notification or publication, any unclaimed balance of such
money then remaining will be repaid to the Company.
Section 8.07. Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States dollars
or non-callable Government Securities in accordance with Section 8.02 or 8.03
hereof, as the case may be, by reason of any order or judgment of any court or
governmental
authority enjoining, restraining or otherwise prohibiting such application, then
the Company's obligations under this Indenture and the Senior Notes shall be
revived and reinstated as though no deposit had occurred pursuant to Section
8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is permitted
to apply all such money in accordance with Section 8.02 or 8.03 hereof, as the
case may be; provided, however, that, if the Company makes any payment of
principal of, premium, if any, or interest or Liquidated Damages, if any, on any
Senior Note following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Senior Notes to receive such
payment from the money held by the Trustee or Paying Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of the Senior Notes.
Notwithstanding Section 9.02 of this Indenture, the Company and the Trustee
may amend or supplement this Indenture or the Senior Notes without the consent
of any Holder of a Senior Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Senior Notes in addition to or in
place of certificated Senior Notes;
(c) to provide for the assumption of the Company's obligations to the
Holders of the Senior Notes in the case of a merger or consolidation
pursuant to Article Five hereof;
(d) to make any change that would provide any additional rights or
benefits to the Holders of the Senior Notes or that does not adversely
affect the legal rights hereunder of any Holder of the Senior Note; or
(e) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA.
Upon the request of the Company accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
9.06 hereof, the Trustee shall join with the Company in the execution of any
amended or supplemental Indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate agreements and stipulations that
may be therein contained, but the Trustee shall not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
Section 9.02. With Consent of Holders of Senior Notes.
Except as provided below in this Section 9.02, the Company and the Trustee
may amend or supplement this Indenture and the Senior Notes may be amended or
supplemented with the consent of the Holders of at least a majority in principal
amount of the Senior Notes then outstanding (including consents obtained in
connection with a purchase of or a tender offer or exchange offer for the Senior
Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or
Event of Default (other than a Default or Event of Default in the payment of the
principal of, premium, if any, or interest on the Senior Notes, except a payment
default resulting from an acceleration that has been rescinded) or compliance
with any provision of this Indenture or the Senior Notes may be waived with the
consent of the Holders of a majority in aggregate principal amount of the then
outstanding Senior Notes (including consents obtained in connection with a
purchase of or a tender offer or exchange offer for the Senior Notes).
Upon the request of the Company accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
Indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Senior Notes as aforesaid, and upon
receipt by the Trustee of the documents described in Section 9.06 hereof, the
Trustee shall join with the Company in the execution of such amended or
supplemental Indenture unless such amended or supplemental Indenture affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise, in
which case the Trustee may in its discretion, but shall not be obligated to,
enter into such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of Senior Notes
under this Section 9.02 to approve the particular form of any proposed amendment
or waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders of each Senior Note affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such amended or
supplemental Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the
Holders of a majority in aggregate principal amount of the Senior Notes then
outstanding may waive compliance in a particular instance by the Company with
any provision of this Indenture or the Senior Notes. However, without the
consent of each Holder affected, an amendment, supplement or waiver may not
(with respect to any Senior Notes held by a non-consenting Holder):
(a) reduce the principal amount of Senior Notes whose Holders must
consent to an amendment, supplement or waiver;
(b) reduce the principal of or extend the fixed maturity of any
Senior Note or alter or waive any of the provisions with respect to the
redemption of the Senior Notes except as provided above with respect to
Sections 3.09, 4.10 and 4.15 hereof;
(c) reduce the rate of or change the time for payment of interest,
including default interest, on any Senior Note;
(d) waive a Default or Event of Default in the payment of principal
of or premium, if any, or interest on the Senior Notes (except a
rescission of acceleration of the Senior Notes by the Holders of at
least a majority in aggregate principal amount of the then outstanding
Senior Notes and a waiver of the payment default that resulted from
such acceleration);
(e) make any Senior Note payable in money other than that stated in
the Senior Notes;
(f) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Senior Notes to
receive payments of principal of or premium, if any, or interest on the
Senior Notes;
(g) make any change in Section 6.04 or 6.07 hereof or in the
foregoing amendment and waiver provisions; or
(h) waive a redemption payment with respect to any Senior Note (other
than a payment required by Sections 3.09, 4.10 and 4.15 hereof).
Section 9.03. Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Senior Notes shall be
set forth in a amended or supplemental Indenture that complies with the TIA as
then in effect.
Section 9.04. Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent to it
by a Holder of a Senior Note is a continuing consent by the Holder and every
subsequent Holder of a Senior Note or portion of a Senior Note that evidences
the same debt as the consenting Holder's Senior Note, even if notation of the
consent is not made on any Senior Note. However, any such Holder or subsequent
Holder of a Senior Note may revoke the consent as to its Senior Note if the
Trustee receives written notice of revocation before the date the waiver,
supplement or amendment becomes effective. An amendment, supplement or waiver
becomes effective in accordance with its terms and thereafter binds every
Holder.
Section 9.05. Notation on or Exchange of Senior Notes.
The Trustee may place an appropriate notation about an amendment, supplement
or waiver on any Senior Note thereafter authenticated. The Company in exchange
for all Senior Notes may issue and the Trustee shall authenticate new Senior
Notes that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Senior 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 amended or supplemental Indenture authorized
pursuant to this Article Nine if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The
Company may not sign an amendment or supplemental Indenture until the Board of
Directors approves it. In executing any amended or supplemental indenture, the
Trustee shall be entitled to receive and (subject to Section 7.01) shall be
fully protected in relying upon, an Officer's Certificate and an Opinion of
Counsel stating that the execution of such amended or supplemental indenture is
authorized or permitted by this Indenture.
ARTICLE 10
MISCELLANEOUS
Section 10.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by TIA (S)318(c), the imposed duties shall control.
Section 10.02. Notices.
Any notice or communication by the Company or the Trustee to the others is
duly given if in writing and delivered in Person or mailed by first class mail
(registered or certified, return receipt requested), telex, telecopier or
overnight air courier guaranteeing next day delivery, to the others' address:
If to the Company:
Hyperion Telecommunications, Inc.
5 West Third Street
Coudersport, Pennsylvania 16915
Telecopy: (814) 274-8631
Attention: Daniel R. Milliard
With a copy to:
Buchanan Ingersoll
One Oxford Centre
301 Grant Street
20th Floor
Pittsburgh, Pennsylvania 15219-1410
Attention: Carl E. Rothenberger, Jr.
If to the Trustee:
Bank of Montreal Trust Company
77 Water Street
New York, New York 10005
Telecopier No.: (212) 701-7684
Attention: Corporate Trust Department
The Company or the Trustee, by notice to the others may designate additional
or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders) shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt acknowledged,
if telecopied; and the next Business Day after timely delivery to the courier,
if sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class mail,
certified or registered, return receipt requested, or by overnight air courier
guaranteeing next day delivery to its address shown on the register kept by the
Registrar. Any notice or communication shall also be so mailed to any Person
described in TIA (S) 313(c), to the extent required by the TIA. Failure to mail
a notice or communication to a Holder or any defect in it shall not affect its
sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it.
If the Company mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each Agent at the same time.
Section 10.03. Communication by Holders of Senior Notes with Other Holders of
Senior Notes.
Holders may communicate pursuant to TIA (S) 312(b) with other Holders with
respect to their rights under this Indenture or the Senior Notes. The Company,
the Trustee, the Registrar and anyone else shall have the protection of TIA (S)
312(c).
Section 10.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth
in Section 10.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably satisfactory
to the Trustee (which shall include the statements set forth in Section
10.05 hereof) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied.
Section 10.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA (S) 314(a)(4)) shall comply with the provisions of TIA (S)
314(e) and shall include:
(a) a statement that the Person making such certificate or opinion has
read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been satisfied; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
Section 10.06. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 10.07. No Personal Liability of Directors, Officers, Employees and
Stockholders.
No director, officer, employee, incorporator or stockholder of the Company,
as such, shall have any liability for any obligations of the Company under the
Senior Notes or the Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder of Senior Notes by
accepting a Senior Note waives and releases all such liability. The waiver and
release are part of the
consideration for issuance of the Senior Notes. Such waiver may not be effective
to waive liabilities under the federal securities laws and it is the view of the
SEC that such a wavier is against public policy.
Section 10.08. Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE AND THE SENIOR NOTES.
Section 10.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture, loan or
debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 10.10. Successors.
All agreements of the Company in this Indenture and the Senior Notes shall
bind its successors. All agreements of the Trustee in this Indenture shall bind
its successors.
Section 10.11. Severability.
In case any provision in this Indenture or in the Senior Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 10.12. Counterpart Originals.
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement.
Section 10.13. Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and Headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part of this Indenture and shall in no way
modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
SIGNATURES
Dated as of April 15, 1996 HYPERION
TELECOMMUNICATIONS, INC.
Issuer
By: /s/ Daniel R. Milliard
---------------------------
Name: Daniel R. Milliard
Title: President and Secretary
Attest:
/s/ Randolph S. Fowler (SEAL)
- ------------------------
Dated as of April 15, 1996 BANK OF MONTREAL TRUST COMPANY
Trustee
By: /s/ Therese Gaballah
---------------------------
Name: Therese Gaballah
Title: Vice President
Attest:
________________________
EXHIBIT A
(Face of Senior Note)
THE SENIOR NOTES EVIDENCED BY THIS CERTIFICATE ARE NOT TRANSFERABLE
SEPARATELY FROM THE WARRANTS ORIGINALLY SOLD AS A UNIT WITH SUCH
SENIOR NOTES UNTIL THE EARLIER OF (i) 90 DAYS FROM THE DATE OF
ISSUANCE, (ii) SUCH DATE AS THE BEAR, STEARNS & CO. INC, CHASE
SECURITIES INC. AND NATIONSBANC CAPITAL MARKETS, INC. MAY, IN THEIR
DISCRETION, DEEM APPROPRIATE, (iii) IN THE EVENT A CHANGE OF CONTROL
(AS DEFINED IN THE INDENTURE) OCCURS, THE DATE THE COMPANY MAILS
NOTICE THEREOF TO HOLDERS OF THE SENIOR NOTES AND (iv) THE DATE ON
WHICH THE EXCHANGE OFFER (AS DEFINED IN THE INDENTURE) IS CONSUMMATED.
FOR PURPOSES OF SECTION 1272, 1273 AND 1275 OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED, THIS SECURITY IS BEING ISSUED WITH ORIGINAL
ISSUE DISCOUNT; FOR EACH $1,000 PRINCIPAL AMOUNT OF THIS SECURITY, THE
ISSUE PRICE IS $532.07, THE AMOUNT OF ORIGINAL ISSUE DISCOUNT IS
$467.28, THE ISSUE DATE IS __________, 1996 AND THE YIELD TO MATURITY
IS 13% PER ANNUM.
13% Series [A/B] Senior Discount Notes due 2003
No. $_______________
CUSIP NO. __________
HYPERION TELECOMMUNICATIONS, INC.
promises to pay to _____________________________________
or registered assigns,
the principal sum of $
dollars on April 15, 2003.
Interest Payment Dates: April 15 and October 15, of each year,
commencing October 15, 2001.
Record Dates: April 1 and October 1
Dated: __________, 1996
HYPERION TELECOMMUNICATIONS, INC.
By:______________________________
Name: Daniel R. Milliard
Title: President and Secretary
By:______________________________
Name: Randolph S. Fowler
Title: Vice President and
Assistant Secretary
(SEAL)
This is one of the Global
Senior Notes referred to in the
within-mentioned Indenture:
BANK OF MONTREAL TRUST COMPANY
as Trustee
By:__________________________________
Name:
Title:
(Back of Senior Note)
13% Series [A/B] Senior Discount Notes due 2003
[Unless and until it is exchanged in whole or in part for Senior Notes in
definitive form, this Senior Note may not be transferred except as a whole by
the Depository to a nominee of the Depository or by a nominee of the Depository
to the Depository or another nominee of the Depository or by the Depository or
any such nominee to a successor Depository or a nominee of such successor
Depository. Unless this certificate is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New York, New
York) ("DTC"), to the issuer or its agent for registration of transfer, exchange
or payment, and any certificate issued is registered in the name of Cede & Co.
or such other name as may be requested by an authorized representative of DTC
(and any payment is made to Cede & Co. or such other entity as may be requested
by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein.]/1/
THE SENIOR NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER
SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND THE SENIOR NOTE EVIDENCED HEREBY MAY NOT BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF
THE SENIOR NOTE EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER
MAY BE RELYING ON THE EXEMPTION PROVIDED BY RULE 144A UNDER THE
SECURITIES ACT. THE HOLDER OF THE SENIOR NOTE EVIDENCED HEREBY AGREES
FOR THE BENEFIT OF HYPERION TELECOMMUNICATIONS, INC. (THE "COMPANY")
THAT (A) SUCH SENIOR NOTE MAY BE RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED, ONLY (1) (A) TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN OF RULE
144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (B) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (C) IN ACCORDANCE
WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL IF THE COMPANY SO
REQUESTS), (2) TO THE COMPANY OR (3) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH THE
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY
________________________
1. This paragraph should be included only if the Senior Note is issued in
global form.
ANY PURCHASER OF THE SENIOR NOTE EVIDENCED HEREBY OF THE RESALE
RESTRICTIONS SET FORTH IN (1) ABOVE.
Capitalized terms used herein shall have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated.
1. Interest. Hyperion Telecommunications, Inc., a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Senior Note
in the manner specified below. Interest will not accrue prior to April 15, 2001.
Thereafter, interest will accrue at the rate of 13% per annum from April 15,
2001 until maturity (including any additional interest required to be paid
pursuant to the provisions of the Registration Rights Agreement) and will be
payable semi-annually in cash on April 15 and October 15 of each year, or if any
such day is not a Business Day, on the next succeeding Business Day (each an
"Interest Payment Date"), commencing April 15, 2001. Interest on the Senior
Notes will accrue from the most recent date to which interest has been paid or,
if no interest has been paid, from the date of issuance; provided that if there
is no existing Default in the payment of interest, and if this Senior Note is
authenticated between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date or if no interest has been paid, from April 15,
2001. The Company will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal and premium, if any,
from time to time on demand at a rate that is 1% per annum in excess of the rate
then in effect; it will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages (without regard to any applicable grace periods) from time to
time on demand at the same rate to the extent lawful. Interest will be computed
on the basis of a 360-day year comprised of twelve 30-day months.
2. Method of Payment. The Company will pay interest on the Senior Notes
(except defaulted interest) to the Persons who are registered Holders of Senior
Notes at the close of business on the April 1 or October 1 next preceding the
Interest Payment Date, even if such Senior Notes are cancelled after such record
date and on or before such Interest Payment Date, except as provided in Section
2.13 of the Indenture with respect to defaulted interest. The Senior Notes shall
be payable as to principal, premium and interest at the office or agency of the
Company maintained for such purpose within or without the City and State of New
York, or, at the option of the Company, payment of interest may be made by check
mailed to the Holders at their addresses set forth in the register of Holders;
provided that payment by wire transfer of immediately available funds shall be
required with respect to principal of, and interest and premium on, all Global
Notes and all other Senior Notes the Holders of which shall have provided wire
transfer instructions to the Company or the Paying Agent. Such payment shall be
in such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts.
3. Paying Agent and Registrar. Initially, Bank of Montreal Trust Company,
the Trustee under the Indenture, shall act as Paying Agent and Registrar. The
Company may change any Paying Agent or Registrar without notice to any Holder.
The Company or any of its Subsidiaries may act in any such capacity.
4. Indenture. The Company issued the Senior Notes under an Indenture dated
as of April 15, 1996 ("Indenture") between the Company and the Trustee. The
terms of the Senior Notes include those stated in the Indenture and those made a
part of the Indenture by reference to the Trust Indenture Act of 1939, as
amended (15 U.S. Code (S)(S) 77aaa-77bbbb) (the "TIA"). The Senior Notes are
subject to all such terms, and Holders are referred to the Indenture and the TIA
for a statement of such terms. The Senior Notes are senior unsecured obligations
of the Company limited to $329.0 million in aggregate principal amount at
maturity.
5. Optional Redemption.
(a) Except as set forth in subparagraph (b) of this Paragraph 5, the Company
shall not have the option to redeem the Senior Notes prior to April 15, 2001.
Thereafter, the Company shall have the option to redeem the Senior Notes, in
whole or in part, upon not less than 30 nor more than 60 days notice, at the
redemption prices (expressed as percentages of principal amount, of, if such
redemption occurs prior to April 15, 2001, the Accreted Value) set forth below
plus accrued and unpaid interest thereon and Liquidated Damages, if any, to the
applicable redemption date, if redeemed during the twelve-month period beginning
on April 15 of the years indicated below:
Year Percentage
---- ----------
2001................................... 106.5%
2002 and thereafter.................... 100.0%
(b) Notwithstanding the foregoing, the Company, on or prior to April 15,
1999, may redeem up to a maximum of 25% of the aggregate principal amount of the
Senior Notes then outstanding at a redemption price of 113.0% of the Accreted
Value thereof, with the net proceeds from either (i) an Initial Public Offering
of the common stock of the Company or (ii) a sale of the Capital Stock (other
than Disqualified Stock) of the Company to a Strategic Investor in a single
transaction or a series of related transactions for at least $25.0 million;
provided that, in either case, at least 75% in aggregate principal amount of the
Senior Notes remain outstanding immediately after the occurrence of such
redemption; and provided, further, that such redemption shall occur within 90
days of the date of the closing of such Initial Public Offering or such sale to
a Strategic Investor, as the case may be.
6. Mandatory Redemption.
Except as set forth in paragraph 7 below, the Company shall not be required
to make mandatory redemption or sinking fund payments with respect to the Senior
Notes.
7. Repurchase at Option of Holder.
(a) Upon the occurrence of a Change of Control, the Company shall be
required to make an offer (a "Change of Control Offer") to each Holder of the
Senior Notes to repurchase all or any part (equal to $1,000 or an integral
multiple thereof) of such Holder's Senior Notes at a purchase price equal to
101% of the aggregate principal amount thereof plus accrued and unpaid interest
and Liquidated Damages, if any, to the date of repurchase (or, in the case of
repurchases of the Senior Notes prior to April 15, 2001, at a purchase price
equal to 101% of the Accreted Value thereof as of the date of repurchase) (in
either case, the "Change of Control Payment"). Within ten days following any
Change of Control, the Company shall mail a notice to each Holder setting forth
the procedures governing the Change of Control Offer as required by the
Indenture.
(b) If the Company or any Subsidiary consummates any Asset Sales, within
five Business Days of each date on which the aggregate amount of Excess Proceeds
exceeds $2.5 million, the Company shall offer to purchase from all Holders of
Senior Notes (an "Asset Sale Offer") pursuant to Section 3.09 of the Indenture
the maximum principal amount of Senior Notes that may be purchased out of the
Excess Proceeds at an offer price in cash equal to 100% of aggregate principal
amount thereof, plus accrued and unpaid interest to the date of repurchase (or,
in the case of repurchases of the Senior Notes prior to April 15, 2001, at a
purchase price equal to 100% of the Accreted Value thereof as of the date of
repurchase), in accordance with the procedures set forth in the Indenture. To
the extent that the aggregate amount thereof, plus accrued and unpaid interest
to the date of repurchase (or, in the case of repurchases of the Senior Notes
prior to April 15, 2001, at a purchase price equal to 100% of the Accreted Value
thereof as of the date of repurchase) is less than the Excess Proceeds, the
Company may use such remaining Excess Proceeds for any purpose not prohibited by
the Indenture. If the aggregate amount of Senior Notes surrendered by Holders
thereof plus accrued and unpaid interest to the date of repurchase (or, in the
case of repurchases of Senior Notes prior to April 15, 2001, the Accreted Value
thereof as of the date of repurchase) exceeds the amount of Excess Proceeds, the
Trustee shall select the Senior Notes to be purchased on a pro rata basis.
Holders of the Senior Notes that are the subject of an offer to purchase shall
receive an Asset Sale Offer from the Company prior to any related purchase date
and may elect to have such Senior Notes purchased by completing the form titled
"Option of Holder to Elect Purchase" on the reverse of the Senior Notes.
8. Notice of Redemption. Notice of redemption shall be mailed at least 30
days but not more than 60 days before the redemption date to each Holder whose
Senior Notes are to be redeemed at its registered address. Senior Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Senior Notes held by a Holder are to be
redeemed. On and after the redemption date, interest ceases to accrue on the
Senior Notes or portions thereof called for redemption.
9. Denominations, Transfer, Exchange. The Senior Notes are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of the Senior Notes may be registered and the Senior Notes
may be exchanged as provided in the Indenture. The Registrar and the Trustee
may require a Holder,
among other things, to furnish appropriate endorsements and transfer documents
and the Company may require a Holder to pay any taxes and fees required by law
or permitted by the Indenture. The Company need not exchange or register the
transfer of any Senior Note or portion of a Senior Note selected for redemption,
except for the unredeemed portion of any Senior Note being redeemed in part.
Also, it need not exchange or register the transfer of any Senior Notes for a
period of 15 days before a selection of Senior Notes to be redeemed or during
the period between a record date and the corresponding Interest Payment Date.
10. Persons Deemed Owners. The registered Holder of a Senior Note may be
treated as its owner for all purposes.
11. Amendment, Supplement and Waiver. Subject to certain exceptions, the
Indenture or the Senior Notes may be amended or supplemented with the consent of
the Holders of at least a majority in principal amount of the then outstanding
Senior Notes, and any existing default or compliance with any provision of the
Indenture or the Senior Notes may be waived with the consent of the Holders of a
majority in aggregate principal amount of the then outstanding Senior Notes.
Without the consent of any Holder of a Senior Note, the Indenture or the Senior
Notes may be amended or supplemented to cure any ambiguity, defect or
inconsistency, to provide for uncertificated Senior Notes in addition to or in
place of certificated Senior Notes, to provide for the assumption of the
Company's obligations to Holders of the Senior Notes in case of a merger or
consolidation, to make any change that would provide any additional rights or
benefits to the Holders of the Senior Notes or that does not adversely affect
the legal rights under the Indenture of any such Holder, or to comply with the
requirements of the SEC in order to effect or maintain the qualification of the
Indenture under the Trust Indenture Act.
12. Defaults and Remedies. Events of Default include: (i) default for 30
days in the payment when due of interest on, or Liquidated Damages with respect
to, the Senior Notes; (ii) default in payment when due of principal of or
premium, if any, on the Senior Notes when the same becomes due and payable at
maturity, upon redemption (including in connection with an offer to purchase) or
otherwise, (iii) failure by the Company to comply with Section 4.07, 4.10, 4.15
or 5.01 of the Indenture; (iv) failure by the Company to comply with Section
4.09 of the Indenture; provided that in the event that the Company fails to
comply with Section 4.09 of the Indenture because indebtedness is deemed to be
incurred by a Restricted Joint Venture solely as a result of such Restricted
Joint Venture ceasing to be a Restricted Joint Venture as a result of (x) the
loss of a Local Partner or (y) the loss of management control of such Restricted
Joint Venture, and such failure continues for 90 days; (v) failure by the
Company for 30 days after notice to the Company by the Trustee or the Holders of
at least 25% in principal amount of the Senior Notes then outstanding to comply
with certain other agreements in the Indenture or the Senior Notes; (vi) default
under certain other agreements relating to Indebtedness of the Company which
default results in the acceleration of such Indebtedness prior to its express
maturity; (vii) certain final judgments for the payment of money that remain
undischarged for a period of 60 days; and (viii) certain events of bankruptcy or
insolvency with respect to the Company or any of its Significant Subsidiaries or
any of its Joint Ventures that would, if it were a Subsidiary, constitute a
Significant Subsidiary. If any Event of Default occurs and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the then
outstanding Senior Notes may declare all the Senior Notes to be due and payable
immediately. Notwithstanding the foregoing, in the case of an Event of Default
arising from certain events of bankruptcy or insolvency with respect to the
Company, any of its Significant Subsidiaries or any Joint Venture that would, if
it were a Subsidiary constitute a Significant Subsidiary, or any group of
Subsidiaries or Joint Ventures that, taken together, would, constitute a
Significant Subsidiary, all outstanding Senior Notes shall become due and
payable without further action or notice. Holders of the Senior Notes may not
enforce the Indenture or the Senior Notes except as provided in the Indenture.
Subject to certain limitations, Holders of a majority in principal amount of the
then outstanding Senior Notes may direct the Trustee in its exercise of any
trust or power. The Trustee may withhold from Holders of the Senior Notes notice
of any continuing Default or Event of Default (except a Default or Event of
Default relating to the payment of principal or interest) if it determines that
withholding notice is in their interest. The Holders of a majority in aggregate
principal amount of the Senior Notes then outstanding by notice to the Trustee
may on behalf of the Holders of all of the Senior Notes waive any existing
Default or Event of Default and its consequences under the Indenture, except a
continuing Default or Event of Default in the payment of interest on, or the
principal of, the Senior Notes. The Company is required to deliver to the
Trustee annually a statement regarding compliance with the Indenture, and the
Company is required upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of Default.
13. Trustee Dealings with Company. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Company or its Affiliates, and may otherwise deal with the Company or
its Affiliates, as if it were not the Trustee.
14. No Recourse Against Others. A director, officer, employee, incorporator
or stockholder, of the Company, as such, shall not have any liability for any
obligations of the Company under the Senior Notes or the Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder by accepting a Senior Note waives and releases all such
liability. The waiver and release are part of the consideration for the
issuance of the Senior Notes.
15. Authentication. This Senior Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
16. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
17. Additional Rights of Holders of Transfer Restricted Securities. In
addition to the rights provided to Holders of the Senior Notes under the
Indenture, Holders of Transferred Restricted Securities shall have all the
rights set forth in the Registration Rights Agreement dated as of April 15,
1996, between the Company and the parties named on the signature pages thereof
(the "Registration Rights Agreement").
18. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Senior Notes and the Trustee may use CUSIP
numbers in notices of redemption as a convenience to the Holders. No
representation is made as to the accuracy of such numbers either as printed on
the Senior Notes or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.
The Company shall furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Hyperion Telecommunications, Inc.
5 West Third Street
Coudersport, Pennsylvania 16915
Telecopy: (814) 274-8631
Attention: Daniel R. Milliard
Assignment Form
To assign this Senior Note, fill in the form below: (I) or (we) assign and
transfer this Senior Note to
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
to transfer this Senior Note on the books of the Company. The agent may
substitute another to act for him.
________________________________________________________________________________
Date:____________________
Your Signature:________________________________
(Sign exactly as your name appears on the face of this Senior Note)
Signature Guarantee.
Option of Holder to Elect Purchase
If you want to elect to have this Senior Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the box below:
[_] Section 4.10 [_] Section 4.15
If you want to elect to have only part of the Senior Note purchased by the
Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the
amount you elect to have purchased: $___________
Date:____________________ Your Signature:______________________
(Sign exactly as your name appears on the Senior Note)
Tax Identification No.:____________________
Signature Guarantee.
EXHIBIT B
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER OF SENIOR
NOTES
Re: 13% Senior Discount Notes due 2003 of Hyperion Telecommunications, Inc.
This Certificate relates to $329,000,000 principal amount of Senior Notes
held in * ________ book-entry or *_______ definitive form by ___________________
(the "Transferor").
The Transferor*:
[_] has requested the Trustee by written order to deliver in exchange for its
beneficial interest in the Global Note held by the Depository a Senior Note or
Senior Notes in definitive, registered form of authorized denominations in an
aggregate principal amount equal to its beneficial interest in such Global Note
(or the portion thereof indicated above); or
[_] has requested the Trustee by written order to exchange or register the
transfer of a Senior Note or Senior Notes.
In connection with such request and in respect of each such Senior Note,
the Transferor does hereby certify that Transferor is familiar with the
Indenture relating to the above captioned Senior Notes and as provided in
Section 2.06 of such Indenture, the transfer of this Senior Note does not
require registration under the Securities Act (as defined below) because:*
[_] Such Senior Note is being acquired for the Transferor's own account, without
transfer (in satisfaction of Section 2.06(a)(ii)(A) or Section 2.06(d)(i)(A) of
the Indenture).
[_] Such Senior Note is being transferred to a "qualified institutional buyer"
(as defined in Rule 144A under the Securities Act of 1933, as amended (the
"Securities Act")) in reliance on Rule 144A (in satisfaction of Section
2.06(a)(ii)(B), Section 2.06(b)(i) or Section 2.06(d)(i)(B) of the Indenture).
_______________
*Check applicable box.
[_] Such Senior Note is being transferred in accordance with Rule 144 under the
Securities Act, or pursuant to an effective registration statement under the
Securities Act (in satisfaction of Section 2.06(a)(ii)(B) or Section
2.06(d)(i)(B) of the Indenture).
[_] Such Senior Note is being transferred in reliance on and in compliance with
an exemption from the registration requirements of the Securities Act, other
than Rule 144A or Rule 144 under the Securities Act. An Opinion of Counsel to
the effect that such transfer does not require registration under the Securities
Act accompanies this Certificate (in satisfaction of Section 2.06(a)(ii)(C) or
Section 2.06(d)(i)(C) of the Indenture).
_______________________________________
[INSERT NAME OF TRANSFEROR]
By:_____________________________________
Date:____________________
_______________
*Check applicable box.
ANNEX A
Form of Intercompany Note
FOR VALUE RECEIVED, __________________, a _______________ corporation (the
"Maker"), promises to pay Hyperion Telecommunications, Inc., a Delaware
corporation (the "Lender"), or order to be paid, all cash advanced, from time to
time, together with interest on the unpaid principal amount at a rate per annum
equal to ___%, to the date of payment. All principal and accrued interest under
this Note shall be due and payable [on demand][on ____________].
This Note may be prepaid in whole or in part at any time without penalty or
premium.
The right to please any and all statutes of limitations as a defense to
demand hereunder is hereby waived to the extent permitted by law. The Maker,
for itself and its successors and assigns, waives presentment, demand, protest
and notice thereof or of dishonor, and waives the right to be released by reason
of any extension of time or change in the terms of payment or any change,
alteration, or release of any security given for the payment hereof.
This Note shall be governed by and construed in accordance with the laws of
the State of New York.
[MAKER]
By: ____________________________
Name:
Title:
Hyperion Telecommunications, Inc.
By: ____________________
Name:
Title:
SCHEDULE A
Fiber Lease Agreements
1. Lease Agreement, dated as of December 12, 1995, by and between PECO Energy
Company and PECO Hyperion Telecommunications.
2. Lease Agreement, dated as of September 29, 1995, by and between Capital
Telecommunications, Inc. and Hyperion Telecommunications of Harrisburg.
3. Facilities Lease Agreement, dated as of June 1, 1995, by and between TRK
Cable Company and New Jersey Fiber Technologies.
4. Lease Agreement, dated 1993, by and between Multimedia Cablevision, Inc. and
Multimedia Hyperion Telecommunications.
5. Facilities Agreement, dated as of June 30, 1994, by and between
International Cablevision, Inc. and NHT Partnership.
6. Fiber Usage Master Agreement, dated as of August 1, 1992, by and between
NewChannels Corp. and NewChannels/Hyperion Telecommunications of New York.
7. Fiber Usage Master Agreement, dated as of August 1, 1992, by and between
NewChannels/Hyperion Telecommunications of New York and Ionian
Communications, L.P. d/b/a Adelphia Cable Communications.
8. License Agreement, dated as of 1992, by and between Continental Cablevision
of Jacksonville, Inc. and Continental Fiber Technologies, Inc.
9. Facilities Lease Agreement, dated as of January 30, 1995, by and between TCI
TKR of Jefferson County, Inc. and Louisville Lightwave.
10. Contract for the Use of Capacity, dated as of May 1, 1994, by and between
Viacom International, Inc. and AVR, L.P., d/b/a Hyperion of Tennessee, L.P.
11. Facilities Agreement, dated as of November 1, 1993, by and between Southeast
Florida Cable, Inc., d/b/a Adelphia Cable Communications, Inc. and TCG South
Florida.
12. Facilities Agreement dated as of September 20, 1993, between TCI of New
York, Inc. and NHT Partnership.
13. License Agreement dated November 1, 1992, between Continental Cablevision of
Virginia, Inc. and Alternet of Virginia.
SCHEDULE B
Local Partners
1. PECO Energy Company
2. Capital Telecommunications, Inc.
3. Sutton Capital Associates, Inc.
4. KRC/CCC Investment Partnership
5. A.C. Communications Inc.
6. Continental Telecommunications Corp. of Virginia
7. Multimedia Telecommunications, Inc.
8. TCI Telephony, Inc.
9. NewChannels Telecommunications of New York, Inc.
10. Continental Cablevision Investments, Inc.
11. TKR Cable of Kentucky, Inc.
12. Viacom Telecom Inc.
13. Robin Media Group, Inc.
14. Any other Local Partners listed under, or who are parties to the Local
Partner Agreements listed on, Schedule C.
SCHEDULE C
Local Partner Agreements
1. Partnership Agreement of PECO Hyperion Telecommunications, dated as of
October 9, 1995, by and between Hyperion Telecommunications of Pennsylvania,
Inc. and PECO Energy Company.
2. Partnership Agreement of Hyperion Telecommunications of Harrisburg, dated as
of September 25, 1994 between Hyperion Telecommunications of Pennsylvania,
Inc. and Capital Telecommunications, Inc.
3. New Jersey Fiber Technologies Partnership Agreement, dated as of June 1994,
by and among Hyperion Telecommunications of New Jersey, Inc., Sutton Capital
Associates, Inc., KRC/CCC Investment Partnership and A.C. Communications
Inc.
4. Joint Venture Agreement of Alternet of Virginia, dated as of November 1,
1992, by and between Hyperion Telecommunications of Virginia, Inc. and
Continental Telecommunications Corp. of Virginia.
5. General Partnership Agreement of Multimedia Hyperion Telecommunications,
dated as of September 1, 1993, by and between Hyperion Telecommunications,
Inc. and Multimedia Telecommunications, Inc.
6. NHT Partnership Agreement, dated as of September 20, 1993, by and among
Hyperion Telecommunications of New York, Inc., TCI Telephony, Inc. and
NewChannels Telecommunications of New York, Inc.
7. NewChannels/Hyperion Telecommunications of New York Agreement of General
Partnership, dated as of August 1, 1992 between Hyperion Telecommunications
of New York, Inc. and NewChannels Telecommunications of New York, Inc., as
amended.
8. Continental Fiber Technologies, Inc. Stock Purchase and Stockholders'
Agreement, dated as of August 31, 1992, by and among Hyperion
Telecommunications of Florida, Inc., Continental Cablevision Investments,
Inc. and Continental Fiber Technologies, Inc.
9. Limited Partnership Agreement of Hyperion of Tennessee, L.P., dated as of
November 15, 1993, by and among Hyperion Telecommunications of Tennessee,
Inc., Viacom Telecom Inc. and Robin Media Group, Inc., as amended.
10. Louisville Lightwave General Partnership Agreement, dated as of July 20,
1994, by and between Hyperion Telecommunication of Kentucky, Inc. and TKR
Cable of Kentucky, Inc.
SCHEDULE D
Management Agreements
1. Management Agreement, dated as of October 1995, by and between Hyperion
Telecommunications, Inc. and PECO Hyperion Telecommunications.
2. Management Agreement, dated as of September 29, 1995, by and between
Hyperion Telecommunications, Inc. and Hyperion Telecommunications of
Harrisburg.
3. Management Agreement, dated as of June 1995, by and between Hyperion
Telecommunications, Inc. and New Jersey Fiber Technologies.
4. Management and Consulting Agreement, dated as of November 1, 1992, by and
between Hyperion Telecommunications of Virginia, Inc. and Alternet of
Virginia.
5. Services Agreement, dated as of November 18, 1993, by and between Hyperion
Telecommunications, Inc. and Multimedia Hyperion Telecommunications.
6. Management Agreement, dated as of June 30, 1994, by and between Hyperion
Telecommunications of New York, Inc. and NHT Partnership.
7. Letter Agreement, dated as of July 13, 1994, and among Hyperion
Telecommunications, Inc. and NewChannels Hyperion Telecommunications (re:
accounting).
8. Network Monitoring Agreement, dated as of October 1, 1994, by and among
Hyperion Telecommunications, Inc. and NewChannels Hyperion
Telecommunications, Inc.
9. Network Monitoring Agreement, dated as of August 1, 1993, between EMI
Communications Corp. and NewChannels/Hyperion Communications of New York.
10. Letter Agreement, dated August 16, 1993, as amended November 1994, between
Hyperion Telecommunications, Inc. and NewChannels Hyperion
Telecommunications (re: accounting).
11. Letter Agreement, dated February 28, 1995, between Hyperion
Telecommunications, Inc. and NewChannels Hyperion Telecommunications (re:
accounting).
12. Network Monitoring Agreement, dated as of October 1, 1993, by and between
Hyperion Telecommunications, Inc. and Continental Fiber Technologies d/b/a
AlterNet.
13. Management Agreement, dated as of January 30, 1995, by and between Hyperion
Telecommunications, Inc. and Louisville Lightwave.
14. Management Agreement, dated as of November 15, 1993, by and between Hyperion
Telecommunications, Inc. and AVR, L.P., d/b/a Hyperion of Tennessee, L.P.,
as amended.
15. Management Agreement, dated as of January 1, 1995, by and between Hyperion
Telecommunications, Inc. and Hyperion Telecommunications of Vermont, Inc.
16. Management Agreement, dated as of June 27, 1995, by and between Hyperion
Telecommunications, Inc. and Hyperion Telecommunications of Virginia, Inc.
17. Network Monitoring Agreement, dated as of October 1, 1993, between Hyperion
Telecommunications, Inc. and Alternet of Virginia.
18. Management and Consulting Agreement, dated as of June 1992, by and between
Hyperion Telecommunications of Florida, Inc. and Continental Fiber
Technologies, Inc.
19. Network Monitoring Agreement, dated as of December 1, 1994, between Hyperion
Telecommunications, Inc. and NewChannels Hyperion Telecommunications.
SCHEDULE E
Form of Financial Information and Operating Data
of the Subsidiaries and the Joint Ventures Presented by Cluster
Data presented for the fiscal period ended _______________:
==================================================================
NORTH MID- OTHER
FINANCIAL DATA EAST ATLANTIC MID-SOUTH NETWORKS
__________________________________________________________________
Total Revenue
__________________________________________________________________
Total Capital
Expenditures
__________________________________________________________________
Total EBITDA
__________________________________________________________________
Proportional Revenue*
__________________________________________________________________
Proportional Capital
Expenditures*
__________________________________________________________________
Proportional EBITDA*
__________________________________________________________________
STATISTICAL DATA
__________________________________________________________________
Route Miles
__________________________________________________________________
Fiber Miles
__________________________________________________________________
Buildings connected
__________________________________________________________________
LEC-COs collocated**
__________________________________________________________________
Voice Grade Equivalent
Circuits
==================================================================
______________
* Represents portion of revenue attributable to the Company.
** Local Exchange Carrier's central office.