EXHIBIT 4.2(a)
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SEAGATE TECHNOLOGY INTERNATIONAL
12 1/2% Senior Subordinated Notes due 2007
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INDENTURE
Dated as of November 22, 2000
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THE BANK OF NEW YORK,
as Trustee
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TABLE OF CONTENTS
Page
ARTICLE 1
Definitions and Incorporation by Reference
SECTION 1.01. Definitions...............................................................................1
SECTION 1.02. Other Definitions........................................................................26
SECTION 1.03. Incorporation by Reference of Trust Indenture Act........................................27
SECTION 1.04. Rules of Construction....................................................................28
ARTICLE 2
The Securities
SECTION 2.01. Amount of Securities; Issuable in Series.................................................28
SECTION 2.02. Form and Dating..........................................................................29
SECTION 2.03. Execution and Authentication.............................................................30
SECTION 2.04. Registrar and Paying Agent...............................................................30
SECTION 2.05. Paying Agent to Hold Money in Trust......................................................31
SECTION 2.06. Holder Lists.............................................................................32
SECTION 2.07. Transfer and Exchange....................................................................32
SECTION 2.08. Replacement Securities...................................................................33
SECTION 2.09. Outstanding Securities...................................................................33
SECTION 2.10. Temporary Securities.....................................................................34
SECTION 2.11. Cancelation..............................................................................34
SECTION 2.12. Defaulted Interest.......................................................................34
SECTION 2.13. CUSIP and ISIN Numbers...................................................................34
ARTICLE 3
Redemption
SECTION 3.01. Notices to Trustee.......................................................................35
SECTION 3.02. Selection of Securities To Be Redeemed...................................................35
SECTION 3.03. Notice of Redemption.....................................................................35
SECTION 3.04. Effect of Notice of Redemption...........................................................36
SECTION 3.05. Deposit of Redemption Price..............................................................36
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SECTION 3.06. Securities Redeemed in Part..............................................................37
ARTICLE 4
Covenants
SECTION 4.01. Payment of Securities....................................................................37
SECTION 4.02. SEC Reports..............................................................................37
SECTION 4.03. Limitation on Indebtedness...............................................................38
SECTION 4.04. Limitation on Restricted Payments........................................................42
SECTION 4.05. Limitation on Restrictions on Distributions from Restricted
Subsidiaries...................................................................51
SECTION 4.06. Limitation on Sales of Assets and Capital Stock..........................................52
SECTION 4.07. Limitation on Transactions with Affiliates...............................................56
SECTION 4.08. Change of Control........................................................................58
SECTION 4.09. Compliance Certificate...................................................................60
SECTION 4.10. Further Instruments and Acts.............................................................60
SECTION 4.11. Future Note Guarantors...................................................................60
SECTION 4.12. Additional Amounts.......................................................................60
SECTION 4.13. Guarantees of Additional Securities......................................................63
SECTION 4.14. Rigid Disc Drive Operations..............................................................63
SECTION 4.15. Amendment of Deferred Compensation Plans.................................................63
SECTION 4.16. Limitation on Lines of Business..........................................................63
SECTION 4.17. Designated Subsidiary Investments........................................................63
SECTION 4.18. Limitation on the Sale or Issuance of Capital Stock of Restricted
Subsidiaries...................................................................64
ARTICLE 5
Successor Company
SECTION 5.01. When Issuer May Merge or Transfer Asset..................................................65
ARTICLE 6
Defaults and Remedies
SECTION 6.01. Events of Default........................................................................67
SECTION 6.02. Acceleration.............................................................................70
Page
SECTION 6.03. Other Remedies...........................................................................71
SECTION 6.04. Waiver of Past Defaults..................................................................71
SECTION 6.05. Control by Majority......................................................................71
SECTION 6.06. Limitation on Suits......................................................................72
SECTION 6.07. Rights of Holders to Receive Payment.....................................................72
SECTION 6.08. Collection Suit by Trustee...............................................................72
SECTION 6.09. Trustee May File Proofs of Claim.........................................................72
SECTION 6.10. Priorities...............................................................................73
SECTION 6.11. Undertaking for Costs....................................................................73
SECTION 6.12. Waiver of Stay or Extension Laws.........................................................74
ARTICLE 7
Trustee
SECTION 7.01. Duties of Trustee........................................................................74
SECTION 7.02. Rights of Trustee........................................................................75
SECTION 7.03. Individual Rights of Trustee.............................................................76
SECTION 7.04. Trustee's Disclaimer.....................................................................77
SECTION 7.05. Notice of Defaults.......................................................................77
SECTION 7.06. Reports by Trustee to Holders............................................................77
SECTION 7.07. Compensation and Indemnity...............................................................77
SECTION 7.08. Replacement of Trustee...................................................................78
SECTION 7.09. Successor Trustee by Merger..............................................................79
SECTION 7.10. Eligibility; Disqualification............................................................80
SECTION 7.11. Preferential Collection of Claims Against Issuer.........................................80
ARTICLE 8
Discharge of Indenture; Defeasance
SECTION 8.01. Discharge of Liability on Securities; Defeasance.........................................80
SECTION 8.02. Conditions to Defeasance.................................................................81
SECTION 8.03. Application of Trust Money...............................................................83
SECTION 8.04. Repayment to Issuer......................................................................83
SECTION 8.05. Indemnity for Government Obligations.....................................................84
SECTION 8.06. Reinstatement............................................................................84
ARTICLE 9
Amendments
Page
SECTION 9.01. Without Consent of Holders...............................................................84
SECTION 9.02. With Consent of Holders..................................................................85
SECTION 9.03. Compliance with Trust Indenture Act......................................................87
SECTION 9.04. Revocation and Effect of Consents and Waivers............................................87
SECTION 9.05. Notation on or Exchange of Securities....................................................87
SECTION 9.06. Trustee to Sign Amendments...............................................................87
SECTION 9.07. Payment for Consent......................................................................88
ARTICLE 10
Subordination
SECTION 10.01. Agreement To Subordinate................................................................88
SECTION 10.02. Liquidation, Dissolution, Bankruptcy....................................................88
SECTION 10.03. Default on Senior Indebtedness..........................................................89
SECTION 10.04. Acceleration of Payment of Securities...................................................90
SECTION 10.05. When Distribution Must Be Paid Over.....................................................90
SECTION 10.06. Subrogation.............................................................................90
SECTION 10.07. Relative Rights.........................................................................91
SECTION 10.08. Subordination May Not Be Impaired by Issuer.............................................91
SECTION 10.09. Rights of Trustee and Paying Agent......................................................91
SECTION 10.10. Distribution or Notice to Representative................................................92
SECTION 10.11. Article 10 Not To Prevent Events of Default or Limit Right To
Accelerate.....................................................................92
SECTION 10.12. Trust Monies Not Subordinated...........................................................92
SECTION 10.13. Trustee Entitled To Rely................................................................92
SECTION 10.14. Trustee To Effectuate Subordination.....................................................93
SECTION 10.15. Trustee Not Fiduciary for Holders of Senior Indebtedness................................93
SECTION 10.16. Reliance by Holders of Senior Indebtedness on Subordination
Provisions.....................................................................93
ARTICLE 11
Note Guarantees
Page
SECTION 11.01. Note Guarantees.........................................................................93
SECTION 11.02. Limitation on Liability.................................................................96
SECTION 11.03. Successors and Assigns..................................................................97
SECTION 11.04. No Waiver...............................................................................97
SECTION 11.05. Modification............................................................................97
SECTION 11.06. Execution of Supplemental Indenture for Future Note
Guarantors.....................................................................98
SECTION 11.07. Non-Impairment..........................................................................98
ARTICLE 12
Subordination of the Note Guarantees
SECTION 12.01. Agreement To Subordinate................................................................98
SECTION 12.02. Liquidation, Dissolution, Bankruptcy....................................................98
SECTION 12.03. Default on Designated Senior Indebtedness of a Note Guarantor...........................99
SECTION 12.04. Demand for Payment.....................................................................100
SECTION 12.05. When Distribution Must Be Paid Over....................................................101
SECTION 12.06. Subrogation............................................................................101
SECTION 12.07. Relative Rights........................................................................101
SECTION 12.08. Subordination May Not Be Impaired by a Note Guarantor..................................101
SECTION 12.09. Rights of Trustee and Paying Agent.....................................................101
SECTION 12.10. Distribution or Notice to Representative...............................................102
SECTION 12.11. Article 12 Not To Prevent Events of Default or Limit Right
To Accelerate.................................................................102
SECTION 12.12. Trustee Entitled To Rely...............................................................102
SECTION 12.13. Trustee To Effectuate Subordination....................................................103
SECTION 12.14. Trustee Not Fiduciary for Holders of Senior Indebtedness of a
Note Guarantor................................................................103
SECTION 12.15. Reliance by Holders of Senior Indebtedness of a Note
Guarantor on Subordination Provisions.........................................103
SECTION 12.16. Defeasance.............................................................................103
ARTICLE 13
Miscellaneous
SECTION 13.01. Trust Indenture Act Controls...........................................................104
SECTION 13.02. Notices ..............................................................................104
SECTION 13.03. Communication by Holders with Other Holders............................................105
SECTION 13.04. Certificate and Opinion as to Conditions Precedent.....................................105
SECTION 13.05. Statements Required in Certificate or Opinion..........................................105
SECTION 13.06. When Securities Disregarded............................................................105
SECTION 13.07. Rules by Trustee, Paying Agent and Registrar...........................................106
SECTION 13.08. Legal Holidays.........................................................................106
SECTION 13.09. GOVERNING LAW..........................................................................106
SECTION 13.10. Waiver of Immunities...................................................................106
SECTION 13.11. Consent to Jurisdiction; Appointment of Agent for Service of
Process; Judgment Currency....................................................106
SECTION 13.12. No Recourse Against Others.............................................................108
SECTION 13.13. Successors.............................................................................108
SECTION 13.14. Multiple Originals.....................................................................108
SECTION 13.15. Table of Contents; Headings............................................................108
Appendix A - Provisions Relating to Original Securities, Additional Securities, Private
Exchange Securities and Exchange Securities
Exhibit A - Form of Initial Security
Exhibit B - Form of Exchange Security
Exhibit C - Form of Supplemental Indenture
Exhibit D - Form of Transferee Letter of Representation
INDENTURE dated as of November 22, 2000,
among NEW SAC, an exempted limited liability company
incorporated under the laws of the Cayman Islands
(the "Company"), SEAGATE TECHNOLOGY INTERNATIONAL, an
exempted limited liability company incorporated under
the laws of the Cayman Islands (the "Issuer"), each
entity listed on Schedule I hereto (the Company and
such entities collectively, the "Note Guarantors"),
and THE BANK OF NEW YORK, a New York banking
corporation, as trustee (the "Trustee").
Each party agrees as follows for the benefit of the other parties and for
the equal and ratable benefit of the Holders of (a) the Issuer's 12 1/2% Senior
Subordinated Notes due 2007 issued on the date hereof (the "Original
Securities"), (b) any Additional Securities (as defined herein) that may be
issued on any Issue Date (all such Securities in clauses (a) and (b) being
referred to collectively as the "Initial Securities"), (c) if and when issued as
provided in a Registration Agreement (as defined in Appendix A hereto (the
"Appendix")), the Issuer's 12 1/2% Senior Subordinated Notes due 2007 issued in
a Registered Exchange Offer in exchange for any Initial Securities (the
"Exchange Securities") and (d) if and when issued as provided in a Registration
Agreement, the Private Exchange Securities (as defined in the Appendix, and
together with the Initial Securities and any Exchange Securities issued
hereunder, the "Securities") issued in a Private Exchange (as defined in the
Appendix). On the date hereof, $210,000,000 in aggregate principal amount of
Securities will be issued. Subject to the conditions and in compliance with the
covenants set forth herein, the Issuer may issue Additional Securities from time
to time.
ARTICLE 1
Definitions and Incorporation by Reference
SECTION 1.01. Definitions.
"Additional Assets" means (1) any property or assets (other than
Indebtedness and Capital Stock) to be used by the Company or a Restricted
Subsidiary in a Permitted Business; (2) the Capital Stock of a Person that
becomes a Restricted Subsidiary as a result of the acquisition of such Capital
Stock by the Company or another Restricted Subsidiary; or (3) Capital Stock
constituting a minority interest in any Person that at such time is a Restricted
Subsidiary; provided, however, that any such Restricted Subsidiary described in
clauses (2) or (3) above is primarily engaged in a Permitted Business.
"Additional Securities" means any 12 1/2% Senior Subordinated Notes due
2007 issued under the terms of this Indenture subsequent to the Closing Date.
"Affiliate" of any specified Person means any other Person, directly or
indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing. For
purposes of Sections 4.06 and 4.07 only, "Affiliate" shall also mean any
beneficial owner of shares representing 10% or more of the total voting power of
the Voting Stock (on a fully diluted basis) of the Company, HDD Holdings or the
Issuer or of rights or warrants to purchase such Voting Stock (whether or not
currently exercisable) and any Person who would be an Affiliate of any such
beneficial owner pursuant to the first sentence hereof.
"Applicable Premium" means, with respect to a Security at any redemption
date, the greater of (1) 1.0% of the principal amount of such Security and (2)
the excess of (A) the present value of (1) the redemption price of such Security
at November 15, 2004, (such redemption price being set forth in the table in
paragraph 5 of such Security) plus (2) all required interest payments due on
such Security through November 15, 2004, computed using a discount rate equal to
the Treasury Rate plus 50 basis points, over (B) the then-outstanding principal
amount of such Security.
"Asset Disposition" means any sale, lease (other than an operating lease
entered into in the ordinary course of business), transfer or other disposition
(or series of related sales, leases, transfers or dispositions) by the Company
or any Restricted Subsidiary, including any disposition by means of a merger,
consolidation or similar transaction (each referred to for the purposes of this
definition as a "disposition"), of (1) any shares of Capital Stock of a
Restricted Subsidiary (other than directors' qualifying shares or shares
required by applicable law to be held by a Person other than the Company or a
Restricted Subsidiary), (2) all or substantially all the assets of any division
or line of business of the Company or any Restricted Subsidiary or (3) any other
assets of the Company or any Restricted Subsidiary outside of the ordinary
course of business of the Company or such Restricted Subsidiary (other than, in
the case of (1), (2) and (3) above, (A) a disposition by a Restricted Subsidiary
to the Company or by the Company or a Restricted Subsidiary to a Note Guarantor
or a Wholly Owned Subsidiary, (B) for purposes of Section 4.06 only, a
disposition that constitutes a Restricted Payment permitted by Section 4.04, (C)
the disposition of all or substantially all of the assets of the Company in a
manner permitted pursuant to Section 5.01, (D) any sale of Capital Stock (other
than Disqualified Stock) of Intermediate Holdings or HDD Holdings, (E) any sale
of Capital Stock in, or Indebtedness or other securities of, an Unrestricted
Subsidiary, (F) a disposition of Temporary Cash Investments, (G) sales of assets
received by the
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Company or any Restricted Subsidiary upon the foreclosure of a lien, (H)
issuances of (i) options, warrants or other rights to purchase common stock of a
Restricted Subsidiary or (ii) shares of common stock of such Restricted
Subsidiary upon exercise of such options, warrants or other rights to officers,
directors and employees of such Restricted Subsidiary pursuant to the terms of
agreements (including employment agreements) or employee or director benefit
plans (or amendments thereto) approved by the Board of Directors in good faith;
provided, however, that shares of common stock of such Restricted Subsidiary
issued pursuant to the exercise of such options, warrants or other rights to
purchase such common stock which are subject this clause (H) shall not exceed
25%, in the case of Seagate Removable Storage Solutions Holdings, or 20%, in the
case of any other Restricted Subsidiary, of the outstanding shares of common
stock of such Restricted Subsidiary, on a fully-diluted basis, (I) any sale of
Capital Stock in CacheVision, Inc., e2open.com LLC or Iolon, Inc., (J) transfers
of patents for microactuator and flexure-related technology to Hutchinson
Technology Incorporated in connection with an interference action; provided,
that the Company and its Subsidiaries shall have received (a) a fully paid-up
license to such patents and (b) a contractual right to receive royalties from
the license by Hutchinson Technology Incorporated of such patents to third
parties, and (K) a disposition of assets with a Fair Market Value of less than
$1.0 million.
"Attributable Debt" in respect of a Sale/Leaseback Transaction means, as at
the time of determination, the present value (discounted at the interest rate
borne by the Securities, compounded annually) of the total obligations of the
lessee for rental payments during the remaining term of the lease included in
such Sale/Leaseback Transaction (including any period for which such lease has
been extended).
"Average Life" means, as of the date of determination, with respect to any
Indebtedness or Preferred Stock, the quotient obtained by dividing (1) the sum
of the products of the numbers of years from the date of determination to the
dates of each successive scheduled principal payment of such Indebtedness or
scheduled redemption or similar payment with respect to such Preferred Stock
multiplied by the amount of such payment by (2) the sum of all such payments.
"Bank Indebtedness" means any and all amounts payable under or in respect
of the Credit Agreement, the guarantees thereof, the collateral documents
related thereto, any Hedging Agreements related thereto and any Refinancing
Indebtedness with respect thereto, as amended from time to time, including
principal, premium (if any), interest (including interest accruing on or after
the filing of any petition in bankruptcy or for reorganization relating to the
Issuer or any Note Guarantor, whether or not a claim for post-filing interest is
allowed in such proceedings), fees, charges, expenses, reimbursement
obligations, guarantees and all other amounts payable thereunder or in respect
thereof. It is understood and agreed that Refinancing Indebtedness in respect of
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the Credit Agreement may be Incurred from time to time after termination of the
Credit Agreement.
"Board of Directors" means the Board of Directors of the Company or any
committee thereof duly authorized to act on behalf of the Board of Directors of
the Company.
"Business Day" means each day which is not a Legal Holiday.
"Capital Stock" of any Person means any and all shares, interests, rights
to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) equity of such Person, including any Preferred
Stock, but excluding any debt securities convertible into such equity.
"Capitalized Lease Obligations" means an obligation that is required to be
classified and accounted for as a capitalized lease for financial reporting
purposes in accordance with GAAP, and the amount of Indebtedness represented by
such obligation shall be the capitalized amount of such obligation determined in
accordance with GAAP; and the Stated Maturity thereof shall be the date of the
last payment of rent or any other amount due under such lease prior to the first
date upon which such lease may be prepaid by the lessee without payment of a
penalty.
"Change of Control" means the occurrence of any of the following events:
(1) prior to the earliest to occur of (A) the first public offering of common
stock of the Company, (B) the first public offering of common stock of
Intermediate Holdings, (C) the first public offering of common stock of HDD
Holdings or (D) the first public offering of common stock of the Issuer, the
Permitted Holders cease to be the "beneficial owner" (as defined in Rules 13d-3
and 13d-5 under the Exchange Act), directly or indirectly, of a majority in the
aggregate of the total voting power of the Voting Stock of the Company,
Intermediate Holdings, HDD Holdings or the Issuer whether as a result of
issuance of securities of the Company, Intermediate Holdings, HDD Holdings or
the Issuer, any merger, consolidation, liquidation or dissolution of the
Company, Intermediate Holdings, HDD Holdings or the Issuer, any direct or
indirect transfer of securities by any Permitted Holder or otherwise (for
purposes of this clause (1) and clause (2) below, the Permitted Holders shall be
deemed to beneficially own any Voting Stock of an entity (the "specified
entity") held by any other entity (the "parent entity") so long as the Permitted
Holders beneficially own (as so defined), directly or indirectly, in the
aggregate a majority of the voting power of the Voting Stock of the parent
entity); (2) (A) any "person" (as such term is used in Sections 13(d) and 14(d)
of the Exchange Act), other than one or more Permitted Holders, is or becomes
the beneficial owner (as defined in clause (1) above, except that for purposes
of this clause (2) such person shall be deemed to have "beneficial ownership" of
all shares that any such person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or
indirectly, of
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more than 35% of the total voting power of the Voting Stock of the Company,
Intermediate Holdings, HDD Holdings or the Issuer and (B) the Permitted Holders
"beneficially own" (as defined in clause (1) above), directly or indirectly, in
the aggregate a lesser percentage of the total voting power of the Voting Stock
of the Company, Intermediate Holdings, HDD Holdings or the Issuer than such
other person and do not have the right or ability by voting power, contract or
otherwise to elect or designate for election a majority of the board of
directors of the Company, Intermediate Holdings, HDD Holdings or the Issuer, as
the case may be (for the purposes of this clause (2), such other person shall be
deemed to beneficially own any Voting Stock of a specified entity held by a
parent entity, if such other person is the beneficial owner (as defined in this
clause (2)), directly or indirectly, of more than 35% of the voting power of the
Voting Stock of such parent entity and the Permitted Holders "beneficially own"
(as defined in clause (1) above), directly or indirectly, in the aggregate a
lesser percentage of the voting power of the Voting Stock of such parent entity
and do not have the right or ability by voting power, contract or otherwise to
elect or designate for election a majority of the board of directors of such
parent entity); (3) during any period of two consecutive years, individuals who
at the beginning of such period constituted the board of directors of the
Company, Intermediate Holdings, HDD Holdings or the Issuer, as the case may be
(together with any new directors whose election by such board of directors of
the Company, Intermediate Holdings, HDD Holdings or the Issuer, as the case may
be, or whose nomination for election by the shareholders of the Company,
Intermediate Holdings, HDD Holdings or the Issuer, as the case may be, was
approved by a vote of 66- 2/3% of the directors of the Company, Intermediate
Holdings, HDD Holdings or the Issuer, as the case may be, then still in office
who were either directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reason to
constitute a majority of the board of directors of the Company, Intermediate
Holdings, HDD Holdings or the Issuer, as the case may be, then in office; (4)
the adoption of a plan relating to the liquidation or dissolution of the
Company, Intermediate Holdings, HDD Holdings or the Issuer; or (5) the merger or
consolidation of the Company, Intermediate Holdings, HDD Holdings or the Issuer
with or into another Person or the merger of another Person with or into the
Company, Intermediate Holdings, HDD Holdings or the Issuer, or the sale of all
or substantially all the assets of the Company, Intermediate Holdings, HDD
Holdings or the Issuer to another Person (other than a Person that is controlled
by the Permitted Holders), and, in the case of any such merger or consolidation,
the securities of the Company, Intermediate Holdings, HDD Holdings or the Issuer
that are outstanding immediately prior to such transaction and which represent
100% of the aggregate voting power of the Voting Stock of the Company,
Intermediate Holdings, HDD Holdings or the Issuer are changed into or exchanged
for cash, securities or property, unless pursuant to such transaction such
securities are changed into or exchanged for, in addition to any other
consideration, securities of the surviving Person or transferee that represent
immediately after such transaction, at least a majority of the aggregate voting
power of the Voting Stock of the surviving Person or transferee.
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"Closing Date" means the date of this Indenture.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commodity Agreements" means with respect to any Person any agreement for
the protection against fluctuations in commodity prices or similar agreements or
arrangements to which such Person is a party or of which it is a beneficiary.
"Consolidated Coverage Ratio" as of any date of determination means the
ratio of: (1) the aggregate amount of EBITDA for the period of the most recent
four consecutive fiscal quarters ending at least 45 days prior to the date of
such determination to (2) Consolidated Interest Expense for such four fiscal
quarters; provided, however, that: (A) if the Company or any Restricted
Subsidiary has Incurred any Indebtedness since the beginning of such period that
remains outstanding on such date of determination or if the transaction giving
rise to the need to calculate the Consolidated Coverage Ratio is an Incurrence
of Indebtedness, EBITDA and Consolidated Interest Expense for such period shall
be calculated after giving effect on a pro forma basis to such Indebtedness as
if such Indebtedness had been Incurred on the first day of such period and the
discharge of any other Indebtedness repaid, repurchased, defeased or otherwise
discharged with the proceeds of such new Indebtedness as if such discharge had
occurred on the first day of such period, (B) if the Company or any Restricted
Subsidiary has repaid, repurchased, defeased or otherwise discharged any
Indebtedness since the beginning of such period or if any Indebtedness is to be
repaid, repurchased, defeased or otherwise discharged (in each case other than
Indebtedness Incurred under any revolving credit facility unless such
Indebtedness has been permanently repaid and has not been replaced) on the date
of the transaction giving rise to the need to calculate the Consolidated
Coverage Ratio, EBITDA and Consolidated Interest Expense for such period shall
be calculated on a pro forma basis as if such discharge had occurred on the
first day of such period and as if the Company or such Restricted Subsidiary has
not earned the interest income actually earned during such period in respect of
cash or Temporary Cash Investments used to repay, repurchase, defease or
otherwise discharge such Indebtedness, (C) if since the beginning of such period
the Company or any Restricted Subsidiary shall have made any Asset Disposition,
the EBITDA for such period shall be reduced by an amount equal to the EBITDA (if
positive) directly attributable to the assets that are the subject of such Asset
Disposition for such period or increased by an amount equal to the EBITDA (if
negative) directly attributable thereto for such period and Consolidated
Interest Expense for such period shall be reduced by an amount equal to the
Consolidated Interest Expense directly attributable to any Indebtedness of the
Company or any Restricted Subsidiary repaid, repurchased, defeased or otherwise
discharged with respect to the Company and its continuing Restricted
Subsidiaries in connection with such Asset Disposition for such period (or, if
the Capital Stock of any Restricted Subsidiary is sold, the Consolidated
Interest Expense for such period directly attributable to the Indebtedness of
such Restricted Subsidiary to the extent the Company and its continuing
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Restricted Subsidiaries are no longer liable for such Indebtedness after such
sale), (D) if since the beginning of such period the Company or any Restricted
Subsidiary (by merger or otherwise) shall have made an Investment in any
Restricted Subsidiary (or any Person that becomes a Restricted Subsidiary) or an
acquisition of assets, including any acquisition of assets occurring in
connection with a transaction causing a calculation to be made hereunder, which
constitutes all or substantially all of an operating unit of a business, EBITDA
and Consolidated Interest Expense for such period shall be calculated after
giving pro forma effect thereto (including the Incurrence of any Indebtedness)
as if such Investment or acquisition occurred on the first day of such period,
and (E) if since the beginning of such period any Person (that subsequently
became a Restricted Subsidiary or was merged with or into the Company or any
Restricted Subsidiary since the beginning of such period) shall have made any
Asset Disposition or any Investment or acquisition of assets that would have
required an adjustment pursuant to clause (C) or (D) above if made by the
Company or a Restricted Subsidiary during such period, EBITDA and Consolidated
Interest Expense for such period shall be calculated after giving pro forma
effect thereto as if such Asset Disposition, Investment or acquisition of assets
occurred on the first day of such period. For purposes of this definition,
whenever pro forma effect is to be given to an acquisition of assets or other
Investment, the amount of income or earnings relating thereto, the amount of
Consolidated Interest Expense associated with any Indebtedness Incurred in
connection therewith and any operating expense reductions and other adjustments
as described below, the pro forma calculations shall be determined in good faith
by a responsible financial or accounting Officer of the Company and (i) shall,
except as described below in clause (iii), comply with the requirements of Rule
11-02 of Regulation S-X of the SEC, (ii) may include adjustments for operating
expense reductions that would be permitted by such Rule and (iii) in connection
with acquisitions, purchases or mergers, may reflect adjustments not permitted
by Rule 11-02 of Regulation S-X of the SEC for the elimination of operating
expenses attributable to any terminated lease or contract, the related reduction
in personnel or facility expenses as a result of such termination and the
elimination of personnel expenses as a result of severance and of facilities
expense as a result of the termination, closure or relocation of facilities, in
each case if such termination, severance, closure or relocation has occurred at
the time of such acquisition, purchase or merger or occurs within three months
thereof. If any Indebtedness bears a floating rate of interest and is being
given pro forma effect, the interest expense on such Indebtedness shall be
calculated as if the rate in effect on the date of determination had been the
applicable rate for the entire period (taking into account any Interest Rate
Agreement applicable to such Indebtedness if such Interest Rate Agreement has a
remaining term as at the date of determination in excess of 12 months).
"Consolidated Interest Expense" means, for any period, the total interest
expense of the Company and its Consolidated Restricted Subsidiaries, plus, to
the extent Incurred by the Company and its Consolidated Restricted Subsidiaries
in such period but
7
not included in such interest expense, without duplication: (1) interest expense
attributable to Capitalized Lease Obligations and the interest expense
attributable to leases constituting part of a Sale/Leaseback Transaction, (2)
amortization of debt discount and debt issuance costs (other than any such costs
associated with the Incurrence of Indebtedness on the Closing Date in connection
with the Transactions), (3) capitalized interest, (4) noncash interest expense,
(5) commissions, discounts and other fees and charges attributable to letters of
credit and bankers' acceptance financing, (6) interest accruing on any
Indebtedness of any other Person to the extent such Indebtedness is Guaranteed
by the Company or any Restricted Subsidiary, (7) net costs associated with
Hedging Obligations (including amortization of fees), (8) dividends in respect
of all Disqualified Stock of the Issuer and all Preferred Stock of the Company
and any of the Subsidiaries of the Company (other than the Issuer), to the
extent held by Persons other than the Company, a Note Guarantor or a Wholly
Owned Subsidiary (other than dividends payable solely in Capital Stock (other
than Disqualified Stock)), (9) interest Incurred in connection with investments
in discontinued operations and (10) the cash contributions to any employee stock
ownership plan or similar trust to the extent such contributions are used by
such plan or trust to pay interest or fees to any Person (other than the
Company) in connection with Indebtedness Incurred by such plan or trust.
"Consolidated Net Income" means, for any period, the net income of the
Company and its Consolidated Subsidiaries for such period; provided, however,
that there shall not be included in such Consolidated Net Income (1) any net
income of any Person (other than the Company) if such Person is not a Restricted
Subsidiary, except that: (A) subject to the limitations contained in clause (4)
below, the Company's equity in the net income of any such Person for such period
shall be included in such Consolidated Net Income up to the aggregate amount of
cash actually distributed by such Person during such period to the Company or a
Restricted Subsidiary as a dividend or other distribution (subject, in the case
of a dividend or other distribution made to a Restricted Subsidiary, to the
limitations contained in clause (3) below) and (B) the Company's equity in a net
loss of any such Person for such period shall be included in
8
determining such Consolidated Net Income; (2) any net income (or loss) of any
Person acquired by the Company or a Subsidiary of the Company in a pooling of
interests transaction for any period prior to the date of such acquisition; (3)
any net income (or loss) of any Restricted Subsidiary other than the Issuer if
such Restricted Subsidiary is subject to restrictions, directly or indirectly,
on the payment of dividends or the making of distributions by such Restricted
Subsidiary, directly or indirectly, except that: (A) subject to the limitations
contained in clause (4) below, the Company's equity in the net income of any
such Restricted Subsidiary for such period shall be included in such
Consolidated Net Income up to the aggregate amount of cash actually distributed
by such Restricted Subsidiary during such period to the Company or another
Restricted Subsidiary as a dividend or other distribution (subject, in the case
of a dividend or other distribution made to another Restricted Subsidiary, to
the limitation contained in this clause) and (B) the Company's equity in a net
loss of any such Restricted Subsidiary for such period shall be included in
determining such Consolidated Net Income; (4) any gain (or loss) realized upon
the sale or other disposition of any asset of the Company or its Consolidated
Restricted Subsidiaries (including pursuant to any Sale/Leaseback Transaction)
that is not sold or otherwise disposed of in the ordinary course of business and
any gain (or loss) realized upon the sale or other disposition of any Capital
Stock of any Person; (5) the net after tax effect of any extraordinary gain or
loss (including all fees and expenses related to such extraordinary gain or
loss); and (6) the cumulative effect of a change in accounting principles.
Notwithstanding the foregoing, for the purpose of Section 4.04 only, there shall
be excluded from Consolidated Net Income any dividends, repayments of loans or
advances or other transfers of assets from Unrestricted Subsidiaries to the
Company or a Restricted Subsidiary to the extent such dividends, repayments or
transfers increase the amount of Restricted Payments permitted under Section
4.04 (a)(5)(C)(iv) .
"Consolidation" means the consolidation of the accounts of each of the
Restricted Subsidiaries with those of the Company in accordance with GAAP
consistently applied; provided, however, that "Consolidation" shall not include
consolidation of the accounts of any Unrestricted Subsidiary, but the interest
of the Company or any Restricted Subsidiary in an Unrestricted Subsidiary shall
be accounted for as an investment. The term "Consolidated" has a correlative
meaning.
"Credit Agreement" means the credit agreement dated as of November 22,
2000, as amended, restated, supplemented, waived, replaced (whether or not upon
termination, and whether with the original lenders or otherwise), refinanced (in
whole or in part), restructured, repaid, refunded or otherwise modified from
time to time, among the Company, the Issuer, Seagate Technology (US) Holdings,
Inc., the financial institutions party thereto as lenders and The Chase
Manhattan Bank, as administrative agent (except to the extent that any such
amendment, restatement, supplement, waiver, replacement, refinancing,
restructuring, repayment, refunding or other modification thereto would be
prohibited by the terms of the Indenture, unless otherwise agreed to by the
Holders of at least a majority in aggregate principal amount of Securities at
the time outstanding).
"Currency Agreement" means with respect to any Person any foreign exchange
contract, currency swap agreements or other similar agreement or arrangement to
which such Person is a party or of which it is a beneficiary.
"Default" means any event which is, or after notice or passage of time or
both would be, an Event of Default.
"Deferred Compensation Plans" means (i) the deferred compensation plan
dated as of November 22, 2000, of HDD Holdings (as amended, waived, supplemented
or otherwise modified from time to time), (ii) the deferred compensation plan
dated as of November 22, 2000, of Seagate Removable Storage Solutions Holdings
(as amended, waived, supplemented or otherwise modified from time to time),
(iii) the deferred compensation plan dated as of November 22, 2000, of Seagate
Technology SAN Holdings (as amended,
9
waived, supplemented or otherwise modified from time to time) and (iv) any other
plan established in lieu of, or to renew or replace, in whole or in part, any
plan referred to in clause (i), (ii) or (iii) above or this clause (iv) and any
other similar plan the purpose or effect of which is to provide to the
participants therein substantially the economic equivalent of an equity
participation in the Company or any of its Subsidiaries in lieu of such an
equity participation or to provide the participants therein the benefits that
they are entitled to on the Closing Date under the Plans described in clause
(i), (ii) or (iii) above or this clause (iv) and (v) any Guarantee by the
Company or any of its Subsidiaries of any obligation under any Deferred
Compensation Plan referred to in clause (i), (ii), (iii) or (iv) above.
"Designated Preferred Stock" means Preferred Stock of the Company (other
than Disqualified Stock) that is issued for cash (other than to a Subsidiary of
the Company or an employee stock ownership plan or trust established by the
Company or any of its Subsidiaries) and is so designated as Designated Preferred
Stock, pursuant to an Officer's Certificate, on the issuance date thereof, the
cash proceeds of which are excluded from the calculation set forth in Section
4.04(a)(5)(C).
"Designated Senior Indebtedness" of the Issuer means (1) the Bank
Indebtedness and (2) any other Senior Indebtedness of the Issuer that, at the
date of determination, has an aggregate principal amount outstanding of, or
under which, at the date of determination, the holders thereof are committed to
lend up to, at least $20 million and is specifically designated by the Issuer in
the instrument evidencing or governing such Senior Indebtedness as "Designated
Senior Indebtedness" for purposes of this Indenture. "Designated Senior
Indebtedness" of a Note Guarantor has a correlative meaning.
"Designated Subsidiary" shall mean each of Seagate Technology SAN Holdings,
Seagate Removable Storage Solutions Holdings and Seagate Software Information
Management Group Holdings, Inc. and each of their Subsidiaries.
"Disqualified Stock" means, with respect to any Person, any Capital Stock
which by its terms (or by the terms of any security into which it is convertible
or for which it is exchangeable or exercisable) or upon the happening of any
event: (1) matures or is mandatorily redeemable pursuant to a sinking fund
obligation or otherwise, (2) is convertible or exchangeable for Indebtedness or
Disqualified Stock (excluding Capital Stock convertible or exchangeable solely
at the option of the Company or a Restricted Subsidiary; provided, however, that
any such conversion or exchange shall be deemed an Incurrence of Indebtedness or
Disqualified Stock, as applicable) or (3) is redeemable at the option of the
holder thereof, in whole or in part, in the case of each of clauses (1), (2) and
(3) on or prior to 91 days after the Stated Maturity of the Securities;
provided,
10
however, that if such Capital Stock is issued to any employee or to any plan for
the benefit of employees of the Company or its Subsidiaries or by any such plan
to such employees, such Capital Stock shall not constitute Disqualified Stock
solely because it may be required to be repurchased by the Company in order to
satisfy applicable statutory or regulatory obligations or as a result of such
employee's death or disability; provided further, however, that any Capital
Stock that would not constitute Disqualified Stock but for provisions thereof
giving holders thereof the right to require such Person to repurchase or redeem
such Capital Stock upon the occurrence of an "asset sale" or "change of control"
occurring prior to 91 days after the Stated Maturity of the Securities shall not
constitute Disqualified Stock if the "asset sale" or "change of control"
provisions applicable to such Capital Stock are not more favorable to the
holders of such Capital Stock than the provisions of Sections 4.06 and 4.08.
"EBITDA" for any period means the Consolidated Net Income for such period,
plus, without duplication, the following to the extent deducted in calculating
such Consolidated Net Income: (1) income tax expense of the Company and its
Consolidated Restricted Subsidiaries, (2) Consolidated Interest Expense, (3)
depreciation expense of the Company and its Consolidated Restricted
Subsidiaries, (4) amortization expense of the Company and its Consolidated
Restricted Subsidiaries (excluding amortization expense attributable to a
prepaid cash item that was paid in a prior period), (5) any annual management,
consulting, monitoring and advisory fees paid by the Company and its Restricted
Subsidiaries to any of the Sponsors, in an amount not to exceed $5 million in
the aggregate in any calendar year, (6) any non-recurring charge relating to a
restructuring plan of the Company and its Restricted Subsidiaries, and (7) all
other noncash charges of the Company and its Consolidated Restricted
Subsidiaries (excluding any such noncash charge to the extent it represents an
accrual of or reserve for cash expenditures in any future period) less all
noncash items of income of the Company and its Restricted Subsidiaries, in each
case for such period. Notwithstanding the foregoing, the provision for taxes
based on the income or profits of, and the depreciation and amortization and
noncash charges of, a Restricted Subsidiary of the Company shall be added to
Consolidated Net Income to compute EBITDA only to the extent (and in the same
proportion) that the net income of such Restricted Subsidiary was included in
calculating Consolidated Net Income and only if a corresponding amount would be
permitted at the date of determination to be dividended to the Company or
another Restricted Subsidiary by such Restricted Subsidiary without prior
approval (that has not been obtained), pursuant to the terms of its charter and
all agreements, instruments, judgments, decrees, orders, statutes, rules and
governmental regulations applicable to such Restricted Subsidiary or its
stockholders.
"Equity Offering" means any public or private sale of common stock or
Preferred Stock of the Company, Intermediate Holdings, HDD Holdings or the
Issuer (other than Disqualified Stock) other than (i) public offerings with
respect to the Company's, Intermediate Holdings', HDD Holdings' or the Issuer's
common stock
11
registered on Form S-8 or any successor form, (ii) any such public or private
sale that constitutes an Excluded Contribution and (iii) other issuances upon
exercise of options by employees of the Company, Intermediate Holdings, HDD
Holdings or the Issuer or any of their Restricted Subsidiaries.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Excluded Contributions" means the net cash proceeds received by the
Company after the Closing Date from (i) contributions (other than from a
Subsidiary of the Company) to its common equity capital and (ii) the sale (other
than to a Subsidiary of the Company or to any Company or Subsidiary management
equity plan or stock option plan or any other management or employee benefit
plan or agreement) of Capital Stock (other than Disqualified Stock and
Designated Preferred Stock) of the Company, in each case designated as Excluded
Contributions pursuant to an Officers' Certificate executed by an Officer of the
Company, the cash proceeds of which are excluded from the calculation set forth
in Section 4.04(a)(5)(C).
"Existing Notes" means the debt securities of Seagate Technology Inc.
issued under the Indenture dated as of March 1, 1997, between Seagate
Technology, Inc. and First Trust of California, National Association, as
trustee, including any supplemental indentures thereto.
"Existing Unrestricted Entity" means each of Seagate Technology Investments
Holdings LLC and each of its Subsidiaries and entities in which it has made
Investments (including CacheVision, Inc., Iolon, Inc. and e2open.com LLC) as of
the Closing Date; provided, however, that each of the foregoing Persons shall
cease to be an Existing Unrestricted Entity at the time that such Person becomes
a Restricted Subsidiary.
"Fair Market Value" means, with respect to any asset or property, the price
which could be negotiated in an arm's-length transaction, for cash, between a
willing seller and a willing and able buyer, neither of whom is under undue
pressure or compulsion to complete the transaction. For all purposes of this
Indenture, the Fair Market Value of property or assets which involve (a) an
aggregate amount in excess of $25 million, shall be set forth in a resolution
approved by the Board of Directors in good faith and (b) an aggregate amount in
excess of $50 million, shall have been determined in writing by a nationally
recognized appraisal or investment banking firm.
"GAAP" means generally accepted accounting principles in the United States
of America as in effect as of the Closing Date, including those set forth in (1)
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants, (2) statements and
pronouncements of the Financial Accounting Standards Board, (3) such other
statements by such other entities as approved by a significant segment of the
accounting profession and (4) the rules and
12
regulations of the SEC governing the inclusion of financial statements
(including pro forma financial statements) in periodic reports required to be
filed pursuant to Section 13 of the Exchange Act, including opinions and
pronouncements in staff accounting bulletins and similar written statements from
the accounting staff of the SEC. All ratios and computations based on GAAP
contained in this Indenture shall be computed in conformity with GAAP.
"Guarantee" means any obligation, contingent or otherwise, of any Person
directly or indirectly guaranteeing any Indebtedness or other obligation of any
other Person and any obligation, direct or indirect, contingent or otherwise, of
such Person (1) to purchase or pay (or advance or supply funds for the purchase
or payment of) such Indebtedness or other obligation of such other Person
(whether arising by virtue of partnership arrangements, or by agreement to
keep-well, to purchase assets, goods, securities or services, to take-or-pay, or
to maintain financial statement conditions or otherwise) or (2) entered into for
purposes of assuring in any other manner the obligee of such Indebtedness or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part); provided, however, that the term
"Guarantee" shall not include endorsements for collection or deposit in the
ordinary course of business. The term "Guarantee" used as a verb has a
corresponding meaning. The term "Guarantor" shall mean any Person Guaranteeing
any obligation.
"HDD Holdings" means Seagate Technology HDD Holdings, an exempted limited
liability company incorporated under the laws of the Cayman Islands and the
parent company of the Issuer.
"Hedging Agreement" means any Currency Agreement, any Interest Rate
Agreement and any Commodity Agreement.
"Hedging Obligations" of any Person means the obligations of such Person
pursuant to any Hedging Agreement.
"Holder" means the Person in whose name a Security is registered on the
Registrar's books.
"Incur" means issue, assume, Guarantee, incur or otherwise become liable
for; provided, however, that any Indebtedness or Capital Stock of a Person
existing at the time such Person becomes a Subsidiary (whether by merger,
consolidation, acquisition or otherwise) shall be deemed to be Incurred by such
Person at the time it becomes a Subsidiary. The term "Incurrence" when used as a
noun shall have a correlative meaning. The accretion of principal of a
non-interest bearing or other discount security shall not be deemed the
Incurrence of Indebtedness.
13
"Indebtedness" means, with respect to any Person on any date of
determination, without duplication: (1) the principal of and premium (if any) in
respect of indebtedness of such Person for borrowed money; (2) the principal of
and premium (if any) in respect of obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments; (3) all obligations of
such Person in respect of letters of credit or other similar instruments
(including reimbursement obligations with respect thereto); (4) all obligations
of such Person to pay the deferred and unpaid purchase price of property or
services (except Trade Payables), which purchase price is due more than six
months after the date of placing such property in service or taking delivery and
title thereto or the completion of such services; (5) all Capitalized Lease
Obligations and all Attributable Debt of such Person; (6) the amount of all
obligations of such Person with respect to the redemption, repayment or other
repurchase of any Disqualified Stock or, with respect to any Subsidiary of such
Person, any Preferred Stock (but excluding, in each case, any accrued
dividends); (7) all Indebtedness of other Persons secured by a Lien on any asset
of such Person, whether or not such Indebtedness is assumed by such Person;
provided, however, that the amount of Indebtedness of such Person shall be the
lesser of (A) the Fair Market Value of such asset at such date of determination
and (B) the amount of such Indebtedness of such other Persons; (8) Hedging
Obligations of such Person; and (9) all obligations of the type referred to in
clauses (1) through (8) of other Persons and all dividends of other Persons for
the payment of which, in either case, such Person is responsible or liable,
directly or indirectly, as obligor, guarantor or otherwise, including by means
of any Guarantee. The amount of Indebtedness of any Person at any date shall be
the outstanding balance at such date of all unconditional obligations as
described above and the maximum liability, upon the occurrence of the
contingency giving rise to the obligation, of any contingent obligations at such
date and in no event shall it include any liabilities incurred under the
Deferred Compensation Plans.
"Indemnification Agreement" means that certain Indemnification Agreement
dated as of March 29, 2000 among Seagate Technology, Inc., VERITAS Software
Corporation and Suez Acquisition Company (Cayman) Limited, as amended from time
to time on or prior to the Closing Date.
"Indenture" means this Indenture as amended or supplemented from time to
time.
"Interest Rate Agreement" means with respect to any Person any interest
rate protection agreement, interest rate future agreement, interest rate option
agreement, interest rate swap agreement, interest rate cap agreement, interest
rate collar agreement, interest rate hedge agreement or other similar agreement
or arrangement to which such Person is party or of which it is a beneficiary.
14
"Intermediate Holdings" means Seagate Technology Holdings, an exempted
limited liability company incorporated under the laws of the Cayman Islands and
the parent company of HDD Holdings.
"Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of business that are
recorded as accounts receivable on the balance sheet of the lender) or other
extension of credit (including by way of Guarantee or similar arrangement) or
capital contribution to (by means of any transfer of cash or other property to
others or any payment for property or services for the account or use of
others), or any purchase or acquisition of Capital Stock, Indebtedness or other
similar instruments issued by such Person. For purposes of the definition of
"Unrestricted Subsidiary" and Section 4.04, (1) "Investment" shall include the
portion (proportionate to the Company's equity interest in such Subsidiary) of
the Fair Market Value of the net assets of any Subsidiary of the Company at the
time that such Subsidiary is designated an Unrestricted Subsidiary; provided,
however, that upon a redesignation of such Subsidiary as a Restricted
Subsidiary, the Company shall be deemed to continue to have a permanent
"Investment" in an Unrestricted Subsidiary in an amount (if positive) equal to
(A) the Company's "Investment" in such Subsidiary at the time of such
redesignation less (B) the portion (proportionate to the Company's equity
interest in such Subsidiary) of the Fair Market Value of the net assets of such
Subsidiary at the time of such redesignation; and (2) any property transferred
to or from an Unrestricted Subsidiary shall be valued at its Fair Market Value
at the time of such transfer.
"Issue Date" , with respect to any Initial Securities, means the date on
which such Initial Securities are originally issued.
"Issuer" means the party named as such in this Indenture until a successor
replaces it and, thereafter, means the successor and, for purposes of any
provision contained herein and required by the TIA, each other obligor on the
indenture securities.
"Lien" means any mortgage, pledge, security interest, encumbrance, lien or
charge of any kind (including any conditional sale or other title retention
agreement or lease in the nature thereof).
"liquidated damages" means any liquidated damages payable under a
Registration Agreement.
"Merger Agreement" means the Agreement and Plan of Merger and
Reorganization dated as of March 29, 2000, by and among VERITAS Software
Corporation, Victory Merger Sub, Inc. and Seagate Technology, Inc., as amended
from time to time on or prior to the Closing Date.
15
"Moody's" means Moody's Investors Service, Inc.
"Net Available Cash" from an Asset Disposition means cash payments received
(including any cash payments received by way of deferred payment of principal
pursuant to a note or installment receivable or otherwise and proceeds from the
sale or other disposition of any securities received as consideration, but only
as and when received, but excluding any other consideration received in the form
of assumption by the acquiring Person of Indebtedness or other obligations
relating to the properties or assets that are the subject of such Asset
Disposition or received in any other noncash form) therefrom, in each case net
of (1) all legal, accounting, investment banking, title and recording tax
expenses, commissions and other fees and expenses incurred, and all U.S.
Federal, state, provincial, foreign and local taxes required to be paid or
accrued as a liability under GAAP, as a consequence of such Asset Disposition,
(2) all payments made on any Indebtedness which is secured by any assets subject
to such Asset Disposition, in accordance with the terms of any Lien upon or
other security agreement of any kind with respect to such assets, or which must
by its terms, or in order to obtain a necessary consent to such Asset
Disposition, or by applicable law be repaid out of the proceeds from such Asset
Disposition, (3) all distributions and other payments required to be made to
minority interest holders in Subsidiaries or joint ventures as a result of such
Asset Disposition and (4) appropriate amounts to be provided by the seller as a
reserve, in accordance with GAAP, against any liabilities associated with the
property or other assets disposed of in such Asset Disposition and retained by
the Company or any Restricted Subsidiary after such Asset Disposition.
"Net Cash Proceeds", with respect to any issuance or sale of Capital Stock,
means the cash proceeds of such issuance or sale net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees, discounts or
commissions and brokerage, consultant and other fees actually incurred in
connection with such issuance or sale and net of taxes paid or payable as a
result thereof.
"Note Guarantee" means each Guarantee of the obligations with respect to
the Securities issued by a Person pursuant to the terms of this Indenture.
"Note Guarantor" means any Person that has issued a Note Guarantee.
"Officer" means the Chairman of the Board, the Chief Executive Officer, the
Chief Financial Officer, the President, any Vice President, the Treasurer or the
Secretary of the Issuer. "Officer" of a Note Guarantor has a correlative
meaning.
"Offering Memorandum" means the Offering Memorandum dated November 17,
2000, relating to the issuance of the Original Securities.
"Officers' Certificate" means a certificate signed by two Officers.
16
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee. The counsel may be an employee of or
counsel to the Issuer, the Company or a Note Guarantor or the Trustee.
"Permitted Business" means any business engaged in by the Company or any
Restricted Subsidiary on the Closing Date and any Related Business.
"Permitted Holders" means the Sponsors, members of management of the
Company, Intermediate Holdings, HDD Holdings or the Issuer who own Capital Stock
of the Company on the Closing Date and each of their Affiliates.
"Permitted Investment" means an Investment by the Company or any Restricted
Subsidiary in (1) the Company, a Restricted Subsidiary or a Person that will,
upon the making of such Investment, become a Restricted Subsidiary; provided,
however, that the primary business of such Restricted Subsidiary is a Permitted
Business; (2) another Person if as a result of such Investment such other Person
is merged or consolidated with or into, or transfers or conveys all or
substantially all its assets to, the Company or a Restricted Subsidiary;
provided, however, that such Person's primary business is a Permitted Business;
(3) Temporary Cash Investments; (4) receivables owing to the Company or any
Restricted Subsidiary if created or acquired in the ordinary course of business
and payable or dischargeable in accordance with customary trade terms; provided,
however, that such trade terms may include such concessionary trade terms as the
Company or any such Restricted Subsidiary deems reasonable under the
circumstances; (5) payroll, travel and similar advances to cover matters that
are expected at the time of such advances ultimately to be treated as expenses
for accounting purposes and that are made in the ordinary course of business;
(6) loans or advances to employees and directors made in the ordinary course of
business consistent with past practices of the Company or such Restricted
Subsidiary and not exceeding $5 million at any one time outstanding; (7) stock,
obligations or securities received in settlement of debts created in the
ordinary course of business and owing to the Company or any Restricted
Subsidiary or in satisfaction of judgments; (8) any Person to the extent such
Investment represents the noncash portion of the consideration received for an
Asset Disposition that was made pursuant to and in compliance with Section 4.06;
(9) any Person; provided, that such Investment exists on the Closing Date and
any Investment that replaces or refunds such an Investment; provided, that the
replacing or refunding Investment is in an amount that does not exceed the
amount of the replaced or refunded Investment (valued at the time made and
without giving effect to subsequent changes in value) and is made in the same
Person as the replaced or refunded Investment; (10) Persons other than
Restricted Subsidiaries (including, but not limited to, Iolon, Inc.,
CacheVision, Inc., e2open.com LLC and Seagate Technology Investments Holdings
LLC) having an aggregate Fair Market Value, taken together with all other
Investments made pursuant to this clause (10) that are at that time outstanding,
not to exceed $150 million at the time of such Investment (with the Fair Market
Value of each Investment being measured at the time
17
made and without giving effect to subsequent changes in value); provided,
however, that not more than $75 million in aggregate Fair Market Value of such
Investments may be made in any calendar year; (11) Hedging Agreements permitted
under Section 4.03(b)(v); (12) any Person; provided, that the payment for such
Investments consists solely of Capital Stock of the Company or its Subsidiaries
(other than Disqualified Stock or, except in the case of the Company,
Intermediate Holdings or HDD Holdings, Preferred Stock); (13) any Person;
provided, that such Investment is acquired by the Company or any of its
Restricted Subsidiaries (a) in exchange for any other Investment or accounts
receivable held by the Company or any such Restricted Subsidiary in connection
with or as a result of a bankruptcy, workout, reorganization or recapitalization
of the issuer of such other Investment or accounts receivable or (b) as a result
of a foreclosure by the Company or any of its Restricted Subsidiaries on a lien;
(14) any Person consisting of Guarantees issued in accordance with Section 4.03;
(15) any Person consisting of the licensing of intellectual property pursuant to
joint ventures, strategic alliances or joint marketing arrangements with such
Person, in each case made in the ordinary course of business; and (16) a vendor
or supplier consisting of loans or advances to such vendor or supplier in
connection with any guarantees to the Company or any Restricted Subsidiary of
supply by, or to fund the supply capacity of, such vendor or supplier, in any
case not to exceed $50 million at any one time outstanding.
"Permitted Junior Securities" shall mean debt or equity securities of the
Issuer or any successor corporation issued pursuant to a plan of reorganization
or readjustment of the Issuer that are subordinated to the payment of all
then-outstanding Senior Indebtedness of the Issuer to at least the same extent
that the Securities are subordinated to the payment of all Senior Indebtedness
of the Issuer on the Closing Date, so long as to the extent that any Senior
Indebtedness of the Issuer outstanding on the date of consummation of any such
plan or reorganization or readjustment is not paid in full in cash or Temporary
Cash Investments on such date, the holders of any such Senior Indebtedness not
so paid in full in cash or Temporary Cash Investments have consented to the
terms of such plan or reorganization or readjustment. "Permitted Junior
Securities" of a Note Guarantor shall have a correlative meaning.
"Person" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof or any
other entity.
"Preferred Stock", as applied to the Capital Stock of any Person, means
Capital Stock of any class or classes (however designated) that is preferred as
to the payment of dividends, or as to the distribution of assets upon any
voluntary or involuntary liquidation or dissolution of such Person, over shares
of Capital Stock of any other class of such Person.
18
"principal" of a Security means the principal of the Security plus the
premium, if any, payable on the Security which is due or overdue or is to become
due at the relevant time.
"Publicly Traded Equity Securities" means equity securities of companies
(other than any Affiliate of the Company) which are listed on the New York Stock
Exchange, the Nasdaq National Market, or another recognized national securities
exchange.
"Purchase Money Indebtedness" means Indebtedness (1) consisting of the
deferred purchase price of an asset, conditional sale obligations, obligations
under any title retention agreement and other purchase money obligations, in
each case where the maturity of such Indebtedness does not exceed the
anticipated useful life of the asset being financed, and (2) Incurred to finance
the acquisition by the Company or a Restricted Subsidiary of such asset,
including additions and improvements; provided, however, that such Indebtedness
is incurred within 180 days after the acquisition by the Company or such
Restricted Subsidiary of such asset.
"Qualified Releasing Event" means, with respect to any Designated
Subsidiary, (a) a transfer by the Company or any Subsidiary of the Company of
all the outstanding Capital Stock of such Designated Subsidiary, or (b) a bona
fide underwritten initial public offering of shares of voting common stock of
such Designated Subsidiary in which at least 10% of the aggregate outstanding
shares of voting common stock of such Designated Subsidiary (calculated on a
fully diluted basis after giving effect to all options to acquire voting common
stock of such Designated Subsidiary then outstanding, regardless of whether such
options are currently exercisable) is issued, in each case, to Persons other
than (i) the Company, (ii) any Affiliate of the Company, (iii) any director,
officer or employee of the Company or any Affiliate of the Company or (iv) any
employee stock ownership plan or other trust established by the Company or any
of its Subsidiaries.
"Refinance" means, in respect of any Indebtedness, to refinance, extend,
renew, refund, repay, prepay, redeem, defease or retire, or to issue other
Indebtedness in exchange or replacement for, such Indebtedness. "Refinanced" and
"Refinancing" shall have correlative meanings.
"Refinancing Indebtedness" means Indebtedness that is Incurred to refund,
refinance, replace, renew, repay or extend (including pursuant to any defeasance
or discharge mechanism) any Indebtedness of the Company or any Restricted
Subsidiary existing on the Closing Date or Incurred in compliance with this
Indenture (including Indebtedness of the Company that Refinances Refinancing
Indebtedness); provided, however, that (1) the Refinancing Indebtedness has a
Stated Maturity no earlier than the Stated Maturity of the Indebtedness being
Refinanced, (2) the Refinancing Indebtedness
19
has an Average Life at the time such Refinancing Indebtedness is Incurred that
is equal to or greater than the Average Life of the Indebtedness being
refinanced, (3) such Refinancing Indebtedness is Incurred in an aggregate
principal amount (or if issued with original issue discount, an aggregate issue
price) that is equal to or less than the aggregate principal amount (or if
issued with original issue discount, the aggregate accreted value) then
outstanding of the Indebtedness being Refinanced and (4) if the Indebtedness
being Refinanced is subordinated in right of payment to the Securities or a Note
Guarantee, such Refinancing Indebtedness is subordinated in right of payment to
the Securities or such Note Guarantee at least to the same extent as the
Indebtedness being Refinanced; provided, however, that clauses (1) and (2) will
not apply to any refunding or refinancing of any Senior Indebtedness; provided
further, however, that Refinancing Indebtedness shall not include (i)
Indebtedness of a Restricted Subsidiary (other than the Issuer) that Refinances
Indebtedness of the Issuer or (ii) Indebtedness of the Company or a Restricted
Subsidiary that Refinances Indebtedness of an Unrestricted Subsidiary.
"Related Business" means any business related, ancillary or complementary
to the businesses of the Company and the Restricted Subsidiaries on the Closing
Date or which constitutes a reasonable extension or expansion of their
businesses.
"Representative" means the trustee, agent or representative (if any) for an
issue of Senior Indebtedness.
"Restricted Subsidiary" means the Issuer, HDD Holdings, Intermediate
Holdings and any other Subsidiary of the Company other than an Unrestricted
Subsidiary.
"Sale/Leaseback Transaction" means an arrangement relating to property now
owned or hereafter acquired by the Company or a Restricted Subsidiary whereby
the Company or a Restricted Subsidiary transfers such property to a Person and
the Company or such Restricted Subsidiary leases it from such Person, other than
leases between (i) the Company and a Note Guarantor or a Wholly Owned Subsidiary
(ii) Note Guarantors, (iii) Wholly Owned Subsidiaries or (iv) a Note Guarantor
and a Wholly Owned Subsidiary.
"S&P" means Standard & Poor's Rating Service.
"SEC" means the Securities and Exchange Commission.
"Secured Indebtedness" means any Indebtedness of the Issuer secured by a
Lien. "Secured Indebtedness" of a Note Guarantor has a correlative meaning.
"Securities" means the Securities issued under this Indenture.
20
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Indebtedness" of the Issuer or any Note Guarantor means the
principal of, premium (if any) and accrued and unpaid interest on (including
interest accruing on or after the filing of any petition in bankruptcy or for
reorganization of the Issuer or any Note Guarantor, regardless of whether or not
a claim for post-filing interest is allowed in such proceedings), and fees and
other amounts (including expenses, reimbursement obligations under letters of
credit and indemnities) owing in respect of, Bank Indebtedness and all other
Indebtedness of the Issuer or any Note Guarantor, as applicable, whether
outstanding on the Closing Date or thereafter Incurred, unless in the instrument
creating or evidencing the same or pursuant to which the same is outstanding it
is provided that such obligations are not superior in right of payment to the
Securities or such Note Guarantor's Note Guarantee, as applicable; provided,
however, that Senior Indebtedness of the Issuer or any Note Guarantor shall not
include: (1) any obligation of the Issuer to the Company or any other Subsidiary
of the Company or any obligation of such Note Guarantor to the Company or any
other Subsidiary of the Company; (2) any liability for U.S. Federal, state,
local or other taxes owed or owing by the Issuer or such Note Guarantor, as
applicable; (3) any accounts payable or other liability to trade creditors
arising in the ordinary course of business (including Guarantees thereof or
instruments evidencing such liabilities); (4) any Indebtedness or obligation of
the Issuer or such Note Guarantor, as applicable (and any accrued and unpaid
interest in respect thereof) that by its terms is subordinate or junior in any
respect to any other Indebtedness or obligation of the Issuer or such Note
Guarantor, as applicable, including any Senior Subordinated Indebtedness and any
Subordinated Obligations of the Issuer or such Note Guarantor, as applicable;
(5) any obligations with respect to any Deferred Compensation Plan; (6) any
obligations with respect to any Capital Stock; or (7) any Indebtedness Incurred
in violation of this Indenture. If any Senior Indebtedness is disallowed,
avoided or subordinated pursuant to Section 548 of Title 11 of the United States
Bankruptcy Code or any applicable state fraudulent conveyance law, such Senior
Indebtedness will nevertheless constitute Senior Indebtedness.
"Senior Subordinated Indebtedness" of the Issuer means the Securities and
any other Indebtedness of the Issuer that specifically provides that such
Indebtedness is to rank equally with the Securities in right of payment and is
not subordinated by its terms in right of payment to any Indebtedness or other
obligation of the Issuer which is not Senior Indebtedness. "Senior Subordinated
Indebtedness" of a Note Guarantor has a correlative meaning.
"Shareholders' Agreement" means each of (i) that certain Shareholders'
Agreement to be entered as of the Closing Date among each of the Sponsors and
the Company and (ii) that certain Management Shareholders Agreement to be
entered as of the Closing Date among each of the members of the management group
that will hold
21
ordinary shares of the Company on the Closing Date and the Company, each as in
effect on the Closing Date.
"Significant Subsidiary" means any Restricted Subsidiary other than the
Issuer that would be a "Significant Subsidiary" of the Company within the
meaning of Rule 1-02 under Regulation S-X promulgated by the SEC.
"Sponsors" means Silver Lake Capital Partners, L.P., Integral Capital
Partners, TPG Partners III, L.P., August Capital, Chase Capital Partners and GS
Capital Partners III, L.P. and each of their respective Affiliates that is a
party to the Shareholders' Agreement.
"Stated Maturity" means, with respect to any security, the date specified
in such security as the fixed date on which the final payment of principal of
such security is due and payable, including pursuant to any mandatory redemption
provision (but excluding any provision providing for the repurchase of such
security at the option of the holder thereof upon the happening of any
contingency beyond the control of the issuer unless such contingency has
occurred).
"Stock Purchase Agreement" means that certain Stock Purchase Agreement
dated as of March 29, 2000 among the Company, the Issuer and Seagate Software
Holdings, Inc., as amended from time to time on or prior to the Closing Date.
"Subordinated Obligation" means any Indebtedness of the Issuer (whether
outstanding on the Closing Date or thereafter Incurred) that is subordinate or
junior in right of payment to the Securities pursuant to a written agreement.
"Subordinated Obligation" of a Note Guarantor has a correlative meaning.
"Subsidiary" of any Person means any corporation, association, partnership
or other business entity of which more than 50% of the total voting power of
shares of Capital Stock or other interests (including partnership interests)
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by (1) such Person, (2) such Person and one
or more Subsidiaries of such Person or (3) one or more Subsidiaries of such
Person; provided, that HDD Holdings and Intermediate Holdings and their
Subsidiaries shall each be deemed to be a Subsidiary of the Company at all times
and for all purposes under this Indenture.
"Temporary Cash Investments" means any of the following: (1) any investment
in direct obligations of the United States of America or any agency thereof or
obligations Guaranteed by the United States of America or any agency thereof,
(2) investments in time deposit accounts, certificates of deposit and money
market deposits maturing within one year of the date of acquisition thereof
issued by a bank or
22
trust company that is organized under the laws of the United States of
America, any state thereof or any foreign country recognized by the United
States of America having capital, surplus and undivided profits aggregating in
excess of $250,000,000 (or the foreign currency equivalent thereof) and whose
long-term debt is rated "A" (or such similar equivalent rating) or higher by at
least one nationally recognized statistical rating organization (as defined in
Rule 436 under the Securities Act), (3) repurchase obligations with a term of
not more than 30 days for underlying securities of the types described in clause
(1) above entered into with a bank meeting the qualifications described in
clause (2) above, (4) investments in commercial paper, maturing not more than
one year after the date of acquisition, issued by a corporation (other than an
Affiliate of the Company) organized and in existence under the laws of the
United States of America or any foreign country recognized by the United States
of America with a rating at the time as of which any investment therein is made
of "P-1" (or higher) according to Moody's Investors Service, Inc. or "A-1" (or
higher) according to Standard and Poor's Ratings Service, a division of The
McGraw-Hill Companies, Inc. ("S&P"), (5) investments in securities with
maturities of one year or less from the date of acquisition issued or fully
guaranteed by any state, commonwealth or territory of the United States of
America, or by any political subdivision or taxing authority thereof, and rated
at least "A" by S&P or "A" by Moody's Investors Service, Inc., and (6)
securities issued by any foreign government or any political subdivision of any
foreign government or any public instrumentality thereof having maturities of
not more than six months from the date of acquisition thereof and, at the time
of acquisition, having one of the two highest credit ratings obtainable from
Moody's Investors Service, Inc. or S&P.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss. 77aaa-
77bbbb) as in effect on the Closing Date, except as provided in Section 9.03.
"Total Assets" means the total consolidated assets of the Company and its
Restricted Subsidiaries, as shown on the most recent balance sheet of the
Company.
"Trade Payables" means, with respect to any Person, any accounts payable or
any indebtedness or monetary obligation to trade creditors created, assumed or
Guaranteed by such Person arising in the ordinary course of business in
connection with the acquisition of goods or services.
"Transactions" means the transactions contemplated by the Stock Purchase
Agreement, the Merger Agreement, the Credit Agreement and the issuance of the
Original Securities including, in each case, the payment of fees and expenses in
connection therewith, all on the terms described in the Offering Memorandum.
"Treasury Rate" means the yield to maturity at the time of computation of
United States Treasury securities with a constant maturity (as compiled by, and
published in, the most recent Federal Reserve Statistical Release H.15(519)
which has become
23
publicly available at least two Business Days prior to the date fixed for
redemption of the Securities following a Change of Control (or, if such
Statistical Release is no longer published, any publicly available source of
similar market data)) most nearly equal to the period from the redemption date
to November 15, 2004; provided, however, that if the period from the redemption
date to November 15, 2004 is not equal to the constant maturity of a United
States Treasury security for which a weekly average yield is given, the Treasury
Rate shall be obtained by linear interpolation (calculated to the nearest
one-twelfth of a year) from the weekly average yields of United States Treasury
securities for which such yields are given, except that if the period from the
redemption date to November 15, 2004, is less than one year, the weekly average
yield on actually traded United States Treasury securities adjusted to a
constant maturity of one year shall be used.
"Trust Officer" means any officer or assistant officer of the Trustee
assigned by the Trustee to administer its corporate trust matters.
"Trustee" means the party named as such in this Indenture until a successor
replaces it and, thereafter, means the successor.
"Uniform Commercial Code" means the New York Uniform Commercial Code as in
effect from time to time.
"Unrestricted Subsidiary" means Seagate Technology Investments Holdings LLC
and (1) any Subsidiary of the Company that at the time of determination shall be
designated an Unrestricted Subsidiary by the Board of Directors in the manner
provided below and (2) any Subsidiary of an Unrestricted Subsidiary. The Board
of Directors may designate any Subsidiary of the Company (including any newly
acquired or newly formed Subsidiary of the Company but excluding the Issuer, HDD
Holdings and Intermediate Holdings) to be an Unrestricted Subsidiary unless such
Subsidiary or any of its Subsidiaries owns any Capital Stock or Indebtedness of,
or owns or holds any Lien on any property of, the Company or any other
Subsidiary of the Company that is not a Subsidiary of the Subsidiary to be so
designated; provided, however, that either (A) the Subsidiary to be so
designated has total Consolidated assets of $1,000 or less or (B) if such
Subsidiary has Consolidated assets greater than $1,000, then such designation
would be permitted under Section 4.04. The Board of Directors may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that
immediately after giving effect to such designation (x) the Company could Incur
$1.00 of additional Indebtedness under Section 4.03(a) or the Consolidated
Coverage Ratio would be greater than such ratio immediately prior to such
designation and (y) no Default shall have occurred and be continuing. Any such
designation of a Subsidiary as a Restricted Subsidiary or Unrestricted
Subsidiary by the Board of Directors shall be evidenced to the Trustee by
promptly filing with the Trustee a copy of the resolution of the Board of
Directors giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the foregoing provisions.
24
"U.S. Dollar Equivalent" means with respect to any monetary amount in a
currency other than U.S. dollars, at any time for determination thereof, the
amount of U.S. dollars obtained by converting such foreign currency involved in
such computation into U.S. dollars at the spot rate for the purchase of U.S.
dollars with the applicable foreign currency as published in The Wall Street
Journal in the "Exchange Rates" column under the heading "Currency Trading" on
the date two Business Days prior to such determination. Except as described
under Section 4.03, whenever it is necessary to determine whether the Company or
the Restricted Subsidiaries have complied with any covenant in the Indenture or
a Default has occurred and an amount is expressed in a currency other than U.S.
dollars, such amount will be treated as the U.S. Dollar Equivalent determined as
of the date such amount is initially determined in such currency.
"U.S. Government Obligations" means direct obligations (or certificates
representing an ownership interest in such obligations) of the United States of
America (including any agency or instrumentality thereof) for the payment of
which the full faith and credit of the United States of America is pledged and
which are not callable or redeemable at the issuer's option.
"Voting Stock" of a Person means all classes of Capital Stock or other
interests (including partnership interests) of such Person then outstanding and
normally entitled (without regard to the occurrence of any contingency) to vote
in the election of directors, managers or trustees thereof.
"Wholly Owned Subsidiary" means a Restricted Subsidiary of the Company all
the Capital Stock of which (other than directors' qualifying shares) is owned by
the Company or another Wholly Owned Subsidiary.
SECTION 1.02. Other Definitions.
Defined in
Term Section
- ---- ----------
"Additional Amounts"............................................. 4.12
"Affiliate Transaction".......................................... 4.07(a)
"Appendix"....................................................... Preamble
"Bankruptcy Law"................................................. 6.01
"beneficially own"............................................... 1.01
"Blockage Notice"................................................ 10.03
"Change of Control Offer"........................................ 4.08(b)
"covenant defeasance option"..................................... 8.01(b)
"Custodian"...................................................... 6.01
"Definitive Security"............................................ Appendix A
"Designated Subsidiary Investments".............................. 4.04(b)(15)
25
Defined in
Term Section
- ---- ----------
"Event of Default"............................................... 6.01
"Exchange Securities"............................................ Preamble
"Global Securities".............................................. Appendix A
"Guarantee Blockage Notice"...................................... 12.03
"Guarantee Payment Blockage Period".............................. 12.03
"Guaranteed Obligations"......................................... 11.01(a)
"incorporated provision"......................................... 13.01
"Initial Securities"............................................. Preamble
"legal defeasance option"........................................ 8.01(b)
"Legal Holiday".................................................. 13.08
"Notice of Default".............................................. 6.01
"Offer".......................................................... 4.06(b)
"Offer Amount"................................................... 4.06(c)(ii)
"Offer Period"................................................... 4.06(c)(ii)
"Original Securities"............................................ Preamble
"pay its Guarantee".............................................. 12.03
"pay the Securities"............................................ 10.03
"Paying Agent"................................................... 2.04(a)
"Payment Blockage Period"........................................ 10.03
"Private Exchange"............................................... Appendix A
"Private Exchange Securities".................................... Appendix A
"protected purchaser"............................................ 2.08
"Purchase Date".................................................. 4.06(c)(i)
"Registration Agreement"......................................... Appendix A
"Registered Exchange Offer"...................................... Appendix A
"Registrar"...................................................... 2.04(a)
"Restricted Payment"............................................. 4.04(a)
"Securities Custodian"........................................... Appendix A
"Successor Company".............................................. 5.01(a)(i)
SECTION 1.03. Incorporation by Reference of Trust Indenture Act. This
Indenture is subject to the mandatory provisions of the TIA, which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities and the Note Guarantees.
"indenture security holder" means a Holder.
26
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Issuer, the Note Guarantors
and any other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by such definitions.
SECTION 1.04. Rules of Construction. Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned to it
in accordance with GAAP;
(c) "or" is not exclusive;
(d) "including" means including without limitation;
(e) words in the singular include the plural and words in the plural
include the singular;
(f) unsecured Indebtedness shall not be deemed to be subordinate or junior
to Secured Indebtedness merely by virtue of its nature as unsecured
Indebtedness;
(g) the principal amount of any noninterest bearing or other discount
security at any date shall be the principal amount thereof that would be shown
on a balance sheet of the issuer dated such date prepared in accordance with
GAAP;
(h) the principal amount of any Preferred Stock shall be (i) the maximum
liquidation value of such Preferred Stock or (ii) the maximum mandatory
redemption or mandatory repurchase price with respect to such Preferred Stock,
whichever is greater; and
(i) all references to "$" or "dollars" are to U.S. Dollars.
27
ARTICLE 2
The Securities
SECTION 2.01. Amount of Securities; Issuable in Series. The aggregate
principal amount of Securities which may be authenticated and delivered under
this Indenture shall not be limited. The Securities may be issued in one or more
series. All Securities of any one series shall be substantially identical except
as to denomination.
With respect to any Additional Securities issued after the Closing Date
(except for Securities authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Securities pursuant to Section
2.07, 2.08, 2.09, 2.10 or 3.06 or the Appendix), there shall be (a) established
in or pursuant to a resolution of the Board of Directors and (b) (i) set forth
or determined in the manner provided in an Officers' Certificate or (ii)
established in one or more indentures supplemental hereto, prior to the issuance
of such Additional Securities:
(1) whether such Additional Securities shall be issued as part of a
new or existing series of Securities and the title of such Additional
Securities (which shall distinguish the Additional Securities of the series
from Securities of any other series);
(2) the aggregate principal amount of such Additional Securities which
may be authenticated and delivered under this Indenture;
(3) the issue price and issuance date of such Additional Securities,
including the date from which interest on such Additional Securities shall
accrue; provided, however, that no Additional Securities may be issued at a
price that would cause such Additional Securities to have "original issue
discount" within the meaning of Section 1273 of the Code;
(4) if applicable, that such Additional Securities shall be issuable
in whole or in part in the form of one or more Global Securities and, in
such case, the respective depositaries for such Global Securities, the form
of any legend or legends which shall be borne by such Global Securities in
addition to or in lieu of those set forth in Exhibit A hereto and any
circumstances in addition to or in lieu of those set forth in Section 2.3
of the Appendix in which any such Global Security may be exchanged in whole
or in part for Additional Securities registered, or any transfer of such
Global Security in whole or in part may be registered, in the name or names
of Persons other than the depositary for such Global Security or a nominee
thereof; and
28
(5) if applicable, that such Additional Securities shall not be issued
in the form of Initial Securities as set forth in Exhibit A, but shall be
issued in the form of Exchange Securities as set forth in Exhibit B.
If any of the terms of any Additional Securities are established by action
taken pursuant to a resolution of the Board of Directors, a copy of an
appropriate record of such action shall be certified by the Secretary or any
Assistant Secretary of the Issuer and delivered to the Trustee at or prior to
the delivery of the Officers' Certificate or the indenture supplemental hereto
setting forth the terms of the Additional Securities.
SECTION 2.02. Form and Dating. Provisions relating to the Original
Securities, the Additional Securities, the Private Exchange Securities and the
Exchange Securities are set forth in the Appendix, which is hereby incorporated
in and expressly made a part of this Indenture. The (a) Original Securities and
the Trustee's certificate of authentication, (b) Private Exchange Securities and
the Trustee's certificate of authentication and (c) any Additional Securities
(if issued as Transfer Restricted Securities) and the Trustee's certificate of
authentication shall each be substantially in the form of Exhibit A hereto,
which is hereby incorporated in and expressly made a part of this Indenture. The
Exchange Securities and any Additional Securities issued other than as Transfer
Restricted Securities and the Trustee's certificate of authentication shall each
be substantially in the form of Exhibit B hereto, which is hereby incorporated
in and expressly made a part of this Indenture. The Securities may have
notations, legends or endorsements required by law, stock exchange rule,
agreements to which the Issuer or any Note Guarantor is subject, if any, or
usage (provided that any such notation, legend or endorsement is in a form
acceptable to the Issuer). Each Security shall be dated the date of its
authentication. The Securities shall be issuable only in registered form without
interest coupons and only in denominations of $1,000 and integral multiples
thereof.
SECTION 2.03. Execution and Authentication. One Officer of the Issuer shall
sign the Securities for the Issuer by manual or facsimile signature.
If an Officer of the Issuer whose signature is on a Security no longer
holds that office at the time the Trustee authenticates the Security, the
Security shall be valid nevertheless.
A Security shall not be valid until an authorized signatory of the Trustee
manually signs the certificate of authentication on the Security. The signature
shall be conclusive evidence that the Security has been authenticated under this
Indenture.
The Trustee shall authenticate and make available for delivery Securities
as set forth in the Appendix.
29
The Trustee may appoint an authenticating agent reasonably acceptable to
the Issuer to authenticate the Securities. Any such appointment shall be
evidenced by an instrument signed by a Trust Officer, a copy of which shall be
furnished to the Issuer. Unless limited by the terms of such appointment, an
authenticating agent may authenticate Securities whenever the Trustee may do so.
Each reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as any
Registrar, Paying Agent or agent for service of notices and demands.
SECTION 2.04. Registrar and Paying Agent. (a) The Issuer shall maintain an
office or agency where Securities may be presented for registration of transfer
or for exchange (the "Registrar") and an office or agency where Securities may
be presented for payment (the "Paying Agent"). The Registrar shall keep a
register of the Securities and of their transfer and exchange. The Issuer may
have one or more co-registrars and one or more additional paying agents. The
term "Paying Agent" includes any additional paying agent, and the term
"Registrar" includes any co-registrars. The Issuer initially appoints the
Trustee as (i) Registrar and Paying Agent in connection with the Securities and
(ii) the Securities Custodian with respect to the Global Securities.
(b) The Issuer shall enter into an appropriate agency agreement with any
Registrar or Paying Agent not a party to this Indenture, which shall incorporate
the terms of the TIA. The agreement shall implement the provisions of this
Indenture that relate to such agent. The Issuer shall notify the Trustee of the
name and address of any such agent. If the Issuer fails to maintain a Registrar
or Paying Agent, the Trustee shall act as such and shall be entitled to
appropriate compensation therefor pursuant to Section 7.07. The Company or any
of its Wholly Owned Subsidiaries may act as Paying Agent or Registrar.
(c) The Issuer may remove any Registrar or Paying Agent upon written notice
to such Registrar or Paying Agent and to the Trustee; provided, however, that no
such removal shall become effective until (i) acceptance of an appointment by a
successor as evidenced by an appropriate agreement entered into by the Issuer
and such successor Registrar or Paying Agent, as the case may be, and delivered
to the Trustee or (ii) notification to the Trustee that the Trustee shall serve
as Registrar or Paying Agent until the appointment of a successor in accordance
with clause (i) above. The Registrar or Paying Agent may resign at any time upon
written notice to the Issuer and the Trustee.
SECTION 2.05. Paying Agent to Hold Money in Trust. Prior to each due date
of the principal of and interest and liquidated damages (if any) on any
Security, the Issuer shall deposit with the Paying Agent (or if the Issuer or a
Wholly Owned Subsidiary is acting as Paying Agent, segregate and hold in trust
for the benefit of the Persons entitled thereto) a sum sufficient to pay such
principal, interest and liquidated damages (if any) when so becoming due. The
Issuer shall require each Paying Agent (other than the Trustee) to agree in
writing that the Paying Agent shall hold in trust for the benefit of
30
Holders or the Trustee all money held by the Paying Agent for the payment of
principal of and interest and liquidated damages (if any) on the Securities, and
shall notify the Trustee of any default by the Issuer in making any such
payment. If the Issuer or a Subsidiary of the Issuer acts as Paying Agent, it
shall segregate the money held by it as Paying Agent and hold it as a separate
trust fund. The Issuer at any time may require a Paying Agent to pay all money
held by it to the Trustee and to account for any funds disbursed by the Paying
Agent. Upon complying with this Section, the Paying Agent shall have no further
liability for the money delivered to the Trustee.
SECTION 2.06. 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 Holders. If the Trustee is not the Registrar, the Issuer shall
furnish, or cause the Registrar to furnish, to the Trustee, in writing at least
five Business Days before each interest payment date and at such other times as
the Trustee may request in writing, a list in such form and as of such date as
the Trustee may reasonably require of the names and addresses of Holders.
SECTION 2.07. Transfer and Exchange. The Securities shall be issued in
registered form and shall be transferable only upon the surrender of a Security
for registration of transfer and in compliance with the Appendix. When a
Security is presented to the Registrar with a request to register a transfer,
the Registrar shall register the transfer as requested if its requirements
therefor are met. When Securities are presented to the Registrar with a request
to exchange them for an equal principal amount of Securities of other
denominations, the Registrar shall make the exchange as requested if the same
requirements are met. To permit registration of transfers and exchanges, the
Issuer shall execute and the Trustee shall authenticate Securities at the
Registrar's request. The Issuer may require payment of a sum sufficient to pay
all taxes, assessments or other governmental charges in connection with any
transfer or exchange pursuant to this Section. The Issuer shall not be required
to make and the Registrar need not register transfers or exchanges of Securities
selected for redemption (except, in the case of Securities to be redeemed in
part, the portion thereof not to be redeemed) or any Securities for a period of
15 days before the mailing of a notice of redemption of Securities to be
redeemed.
Prior to the due presentation for registration of transfer of any Security,
the Issuer, the Note Guarantors, the Trustee, the Paying Agent, and the
Registrar may deem and treat the Person in whose name a Security is registered
as the absolute owner of such Security for the purpose of receiving payment of
principal of and (subject to paragraph 2 of the Securities) interest, if any, on
such Security and for all other purposes whatsoever, whether or not such
Security is overdue, and none of the Issuer, any Note Guarantor, the Trustee,
the Paying Agent, or the Registrar shall be affected by notice to the contrary.
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Any Holder of a Global Security shall, by acceptance of such Global
Security, agree that transfers of beneficial interest in such Global Security
may be effected only through a book-entry system maintained by (a) the Holder of
such Global Security (or its agent) or (b) any Holder of a beneficial interest
in such Global Security, and that ownership of a beneficial interest in such
Global Security shall be required to be reflected in a book entry.
All Securities issued upon any transfer or exchange pursuant to the terms
of this Indenture shall evidence the same debt and shall be entitled to the same
benefits under this Indenture as the Securities surrendered upon such transfer
or exchange.
SECTION 2.08. Replacement Securities. If a mutilated Security is
surrendered to the Registrar or if the Holder of a Security claims that the
Security has been lost, destroyed or wrongfully taken, the Issuer shall issue
and the Trustee shall authenticate a replacement Security if the requirements of
Section 8-405 of the Uniform Commercial Code are met, such that the Holder (a)
satisfies the Issuer or the Trustee within a reasonable time after such Holder
has notice of such loss, destruction or wrongful taking and the Registrar does
not register a transfer prior to receiving such notification, (b) makes such
request to the Issuer or the Trustee prior to the Security being acquired by a
protected purchaser as defined in Section 8-303 of the Uniform Commercial Code
(a "protected purchaser") and (c) satisfies any other reasonable requirements of
the Trustee. Such Holder shall furnish an indemnity bond sufficient in the
judgment of the Trustee to protect the Issuer, the Trustee, the Paying Agent and
the Registrar from any loss that any of them may suffer if a Security is
replaced. The Issuer and the Trustee may charge the Holder for their expenses in
replacing a Security. In the event any such mutilated, lost, destroyed or
wrongfully taken Security has become or is about to become due and payable, the
Issuer in its discretion may pay such Security instead of issuing a new Security
in replacement thereof.
Every replacement Security is an additional obligation of the Issuer.
The provisions of this Section 2.08 are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, lost, destroyed or wrongfully taken Securities.
SECTION 2.09. Outstanding Securities. Securities outstanding at any time
are all Securities authenticated by the Trustee except for those canceled by it,
those delivered to it for cancelation, those paid pursuant to this Section 2.09
and those described in this Section as not outstanding. Subject to Section
13.06, a Security does not cease to be outstanding because the Issuer or an
Affiliate of the Issuer holds the Security.
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If a Security is replaced pursuant to Section 2.08, it ceases to be
outstanding unless the Trustee and the Issuer receive proof satisfactory to them
that the replaced Security is held by a protected purchaser.
If the Paying Agent segregates and holds in trust, in accordance with this
Indenture, on a redemption date or maturity date money sufficient to pay all
principal, interest and liquidated damages, if any, payable on that date with
respect to the Securities (or portions thereof) to be redeemed or maturing, as
the case may be, and the Paying Agent is not prohibited from paying such money
to the Holders on that date pursuant to the terms of this Indenture then on and
after that date such Securities (or portions thereof) cease to be outstanding
and interest on them ceases to accrue.
SECTION 2.10. Temporary Securities. In the event that Definitive Securities
are to be issued under the terms of this Indenture, until such Definitive
Securities are ready for delivery, the Issuer may prepare and the Trustee shall
authenticate temporary Securities. Temporary Securities shall be substantially
in the form of Definitive Securities but may have variations that the Issuer
considers appropriate for temporary Securities. Without unreasonable delay, the
Issuer shall prepare and the Trustee shall authenticate Definitive Securities
and deliver them in exchange for temporary Securities upon surrender of such
temporary Securities at the office or agency of the Issuer, without charge to
the Holder.
SECTION 2.11. Cancelation. The Issuer at any time may deliver Securities to
the Trustee for cancelation. The Registrar and the Paying Agent shall forward to
the Trustee any Securities surrendered to them for registration of transfer,
exchange or payment. The Trustee and no one else shall cancel all Securities
surrendered for registration of transfer, exchange, payment or cancelation and
shall dispose of canceled Securities in accordance with its customary procedures
or deliver canceled Securities to the Issuer pursuant to written direction by an
Officer. The Issuer may not issue new Securities to replace Securities it has
redeemed, paid or delivered to the Trustee for cancelation. The Trustee shall
not authenticate Securities in place of canceled Securities other than pursuant
to the terms of this Indenture.
SECTION 2.12. Defaulted Interest. If the Issuer defaults in a payment of
interest on the Securities, the Issuer shall pay the defaulted interest (plus
interest on such defaulted interest to the extent lawful) in any lawful manner.
The Issuer may pay the defaulted interest to the Persons who are Holders on a
subsequent special record date. The Issuer shall fix or cause to be fixed any
such special record date and payment date to the reasonable satisfaction of the
Trustee and shall promptly mail or cause to be mailed to each Holder a notice
that states the special record date, the payment date and the amount of
defaulted interest to be paid.
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SECTION 2.13. CUSIP and ISIN Numbers. The Issuer in issuing the Securities
may use CUSIP and ISIN numbers (if then generally in use) and, if so, the
Trustee shall use CUSIP and ISIN numbers in notices of redemption as a
convenience to Holders; provided, however, that any such notice may state that
no representation is made as to the correctness of such numbers either as
printed on the Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on the
Securities, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Issuer will promptly notify the Trustee of any
change in the CUSIP or ISIN numbers.
ARTICLE 3
Redemption
SECTION 3.01. Notices to Trustee. If the Issuer elects to redeem Securities
pursuant to paragraph 5 or 6 of the Securities, it shall notify the Trustee in
writing of the redemption date and the principal amount of Securities to be
redeemed.
The Issuer shall give each notice to the Trustee provided for in this
Section at least 60 days before the redemption date unless the Trustee consents
to a shorter period. Such notice shall be accompanied by an Officers'
Certificate and an Opinion of Counsel from the Issuer to the effect that such
redemption will comply with the conditions herein. Any such notice may be
canceled at any time prior to 3 business days prior to the date the Trustee
mails notice of such redemption to any Holder and shall thereby be void and of
no effect.
SECTION 3.02. Selection of Securities To Be Redeemed. If fewer than all the
Securities are to be redeemed, the Trustee shall select the Securities to be
redeemed pro rata or by lot or by a method that the Trustee in its sole
discretion shall deem to be fair and appropriate. The Trustee shall make the
selection from outstanding Securities not previously called for redemption. The
Trustee may select for redemption portions of the principal of Securities that
have denominations larger than $1,000. Securities and portions of them the
Trustee selects shall be in amounts of $1,000 or a whole multiple of $1,000.
Provisions of this Indenture that apply to Securities called for redemption also
apply to portions of Securities called for redemption. The Trustee shall notify
the Issuer promptly of the Securities or portions of Securities to be redeemed.
SECTION 3.03. Notice of Redemption. (a) At least 30 days but not more than
60 days before a date for redemption of Securities, the Issuer shall mail a
notice of redemption by first-class mail to each Holder of Securities to be
redeemed at such Holder's registered address.
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The notice shall identify the Securities to be redeemed and shall state:
(i) the redemption date;
(ii) the redemption price and the amount of accrued interest to the
redemption date;
(iii) the name and address of the Paying Agent;
(iv) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(v) if fewer than all the outstanding Securities are to be redeemed,
the certificate numbers and principal amounts of the particular Securities
to be redeemed;
(vi) that, unless the Issuer defaults in making such redemption
payment or the Paying Agent is prohibited from making such payment pursuant
to the terms of this Indenture, interest on Securities (or portion thereof)
called for redemption ceases to accrue on and after the redemption date;
(vii) the CUSIP or ISIN number, if any, printed on the Securities
being redeemed; and
(viii) that no representation is made as to the correctness or
accuracy of the CUSIP or ISIN number, if any, listed in such notice or
printed on the Securities.
(b) At the Issuer's request, the Trustee shall give the notice of
redemption in the Issuer's name and at the Issuer's expense. In such event, the
Issuer shall provide the Trustee with the information required by this Section.
SECTION 3.04. Effect of Notice of Redemption. Once notice of redemption is
mailed, Securities called for redemption become due and payable on the
redemption date and at the redemption price stated in the notice. Upon surrender
to the Paying Agent, such Securities shall be paid at the redemption price
stated in the notice, plus accrued interest and liquidated damages, if any, to
the redemption date; provided, however, that if the redemption date is after a
regular record date and on or prior to the interest payment date, the accrued
interest and liquidated damages, if any, shall be payable to the Holder of the
redeemed Securities registered on the relevant record date. Failure to give
notice or any defect in the notice to any Holder shall not affect the validity
of the notice to any other Holder.
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SECTION 3.05. Deposit of Redemption Price. Prior to 10:00 a.m., New York
City time, on the redemption date, the Issuer shall deposit with the Paying
Agent (or, if the Issuer or a Wholly Owned Subsidiary is the Paying Agent, shall
segregate and hold in trust) money sufficient to pay the redemption price of and
accrued interest and liquidated damages, if any, on all Securities or portions
thereof to be redeemed on that date other than Securities or portions of
Securities called for redemption that have been delivered by the Issuer to the
Trustee for cancelation. On and after the redemption date, interest shall cease
to accrue on Securities or portions thereof called for redemption so long as the
Issuer has deposited with the Paying Agent funds sufficient to pay the principal
of, plus accrued and unpaid interest and liquidated damages, if any, on, the
Securities to be redeemed, unless the Paying Agent is prohibited from making
such payment pursuant to the terms of this Indenture.
SECTION 3.06. Securities Redeemed in Part. Upon surrender of a Security
that is redeemed in part, the Issuer shall execute and the Trustee shall
authenticate for the Holder (at the Issuer's expense) a new Security equal in
principal amount to the unredeemed portion of the Security surrendered.
ARTICLE 4
Covenants
SECTION 4.01. Payment of Securities. The Issuer shall promptly pay the
principal of and interest and liquidated damages, if any, on the Securities on
the dates and in the manner provided in the Securities and in this Indenture.
Principal, interest and liquidated damages, if any, shall be considered paid on
the date due if on such date the Trustee or the Paying Agent holds in accordance
with this Indenture money sufficient to pay all principal and interest then due
and the Trustee or the Paying Agent, as the case may be, is not prohibited from
paying such money to the Holders on that date pursuant to the terms of this
Indenture.
The Issuer shall pay interest on overdue principal at the rate specified
therefor in the Securities, and it shall pay interest on overdue installments of
interest at the same rate to the extent lawful.
SECTION 4.02. SEC Reports. Notwithstanding that the Company may not be
subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, the Company shall file with the SEC, and provide the Trustee and Holders
and prospective Holders (upon request) within 15 days after it files them with
the SEC, copies of its annual report and the information, documents and other
reports that are specified in Sections 13 and 15(d) of the Exchange Act
provided, however, the Company shall not be so obligated to file such reports
with the SEC if the SEC does not permit such filing, in
36
which event the Company will make available such information to the trustee,
Holders and prospective Holders (upon request) within 15 days after the time the
Company would be required to file such information with the SEC if it were
subject to Section 13 or 15(d) of the Exchange Act. In addition, following a
public equity offering, the Company shall furnish to the Trustee and the
Holders, promptly upon their becoming available, copies of the annual report to
shareholders and any other information provided by the Company to its public
shareholders generally. The Company also shall comply with the other provisions
of Section 314(a) of the TIA. Delivery of such reports, information and
documents to the Trustee is for informational purposes only and the Trustee's
receipt of such shall not constitute constructive notice of any information
contained therein or determinable from information contained therein, including
the Company's compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers' Certificates).
SECTION 4.03. Limitation on Indebtedness. (a) The Company shall not, and
shall not permit any Restricted Subsidiary to, Incur, directly or indirectly,
any Indebtedness; provided, however, that the Issuer or any Note Guarantor may
Incur Indebtedness if on the date of such Incurrence and after giving effect
thereto, the Consolidated Coverage Ratio would be at least 5.0:1.
(b) Notwithstanding Section 4.03(a), the Company and the Restricted
Subsidiaries may Incur the following Indebtedness:
(i) Bank Indebtedness Incurred pursuant to the Credit Agreement in an
aggregate principal amount not to exceed $900 million;
(ii) Indebtedness of the Company owed to and held by any Note
Guarantor or Wholly Owned Subsidiary or Indebtedness of a Note Guarantor or
Wholly Owned Subsidiary owed to and held by the Company or another Note
Guarantor or Wholly Owned Subsidiary; provided, however, that (1) any
subsequent issuance or transfer of any Capital Stock or any other event
that results in any such Note Guarantor or Wholly Owned Subsidiary ceasing
to be a Note Guarantor or Wholly Owned Subsidiary, as applicable, or any
subsequent transfer of any such Indebtedness (except to the Company or
another Note Guarantor or Wholly Owned Subsidiary) shall be deemed, in each
case, to constitute the Incurrence of such Indebtedness by the issuer
thereof, (2) if the Issuer is the obligor on such Indebtedness, such
Indebtedness is expressly subordinated to the prior payment in full in cash
of all obligations with respect to the Securities and (3) if a Note
Guarantor is the obligor on such Indebtedness and such Indebtedness is owed
to and held by a Restricted Subsidiary that is not a Note Guarantor, such
Indebtedness is expressly subordinated to the prior payment in full in cash
of all obligations of such Note Guarantor with respect to its Note
Guarantee;
37
(iii) Indebtedness (1) represented by the Securities (not including
any Additional Securities) and the Note Guarantees, (2) outstanding on the
Closing Date (other than the Indebtedness described in clauses (i) and (ii)
above); provided, however, that all Indebtedness of the Company and its
Subsidiaries in respect of the Existing Notes shall only be permitted to be
outstanding under this clause (2) until 45 days or, if the date of
redemption of the Existing Notes shall be reasonably extended by the
trustee under the indenture under which the Existing Notes were issued, the
earlier of the extended date of redemption and 120 days following the
Closing Date; provided, further, that Indebtedness under the Existing Notes
shall only be permitted under this clause (2) to the extent that sufficient
funds to effect the redemption of the Existing Notes remain deposited in
trust for that purpose, on the terms described in the Offering Memorandum
under "The Transactions -- Redemption of Existing Senior Notes", (3)
consisting of Refinancing Indebtedness Incurred in respect of any
Indebtedness described in this clause (iii) (including Indebtedness that is
Refinancing Indebtedness) or Section 4.03(a) and (4) consisting of
Guarantees by the Issuer or a Note Guarantor of Indebtedness or other
obligations of the Company or any of its Restricted Subsidiaries so long as
the Incurrence of such Indebtedness Incurred by the Company or such
Restricted Subsidiary is permitted under the terms of this Indenture;
provided that if such Indebtedness is by its express terms subordinated in
right of payment to the Securities or the Note Guarantee of such Restricted
Subsidiary, as applicable, any such Guarantee of such Note Guarantor with
respect to such Indebtedness or other obligations shall be subordinated in
right of payment to the Securities or such Note Guarantor's Note Guarantee
with respect to the Securities substantially to the same extent as such
Indebtedness is subordinated to the Securities or the Note Guarantee of
such Restricted Subsidiary, as applicable;
(iv) (1) Indebtedness of a Restricted Subsidiary Incurred and
outstanding on or prior to the date on which such Restricted Subsidiary was
acquired by the Company (other than Indebtedness Incurred in contemplation
of, in connection with, as consideration in, or to provide all or any
portion of the funds or credit support utilized to consummate, the
transaction or series of related transactions pursuant to which such
Restricted Subsidiary became a Subsidiary of or was otherwise acquired by
the Company); provided, however, that on the date that such Restricted
Subsidiary is acquired by the Company, either (x) the Company would have
been able to Incur $1.00 of additional Indebtedness pursuant to Section
4.03(a) after giving effect to the Incurrence of such Indebtedness pursuant
to this clause (iv) or (y) the Consolidated Coverage Ratio after giving
effect to such acquisition would be (A) greater than the Consolidated
Coverage Ratio immediately prior to such acquisition and (B) at least 4.5:1
and (2) Refinancing Indebtedness Incurred by a Restricted Subsidiary in
respect of Indebtedness Incurred by such Restricted Subsidiary pursuant to
this clause (iv);
38
(v) Indebtedness (1) in respect of performance bonds, workman's
compensation, completion guarantees, bankers' acceptances, letters of
credit and bid, surety or appeal bonds provided by the Company and the
Restricted Subsidiaries in the ordinary course of their business, and (2)
under Hedging Agreements entered into for bona fide hedging purposes of the
Company in the ordinary course of business or entered into in connection
with the redemption of the Existing Notes; provided, however, that such
Hedging Agreements do not increase the Indebtedness of the Company
outstanding at any time other than as a result of fluctuations in interest
rates, exchange rates, commodity prices or by reason of fees, indemnities
and compensation payable thereunder;
(vi) Purchase Money Indebtedness, mortgage financings, Capitalized
Lease Obligations and Attributable Debt in respect of Sale/Leaseback
Transactions in an aggregate principal amount not in excess of $125 million
at any time outstanding;
(vii) Indebtedness arising from agreements of the Company or a
Restricted Subsidiary providing for indemnification, adjustment of purchase
price or similar obligations, in each case Incurred in connection with the
disposition of any business, assets or a subsidiary of the Company in
accordance with the terms of this Indenture, other than guarantees of
Indebtedness Incurred by any Person acquiring all or any portion of such
business, assets or Subsidiary for the purpose of financing such
acquisition;
(viii) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument drawn against
insufficient funds in the ordinary course of business, provided that such
Indebtedness is extinguished within five Business Days of its Incurrence;
(ix) the Incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness constituting reimbursement obligations with
respect to letters of credit issued in the ordinary course of business;
provided, however, that upon the drawing of such letters of credit, such
obligations are reimbursed within 30 days following such drawing;
(x) obligations arising from or representing deferred compensation to
employees of the Company or its Subsidiaries that constitute or are deemed
to be Indebtedness under GAAP and that are Incurred in the ordinary course
of business; and
(xi) Indebtedness (other than Indebtedness permitted to be Incurred
pursuant to Section 4.03(a) or any other clause of this Section 4.03(b)) in
an aggregate principal amount on the date of Incurrence that, when added to
all other
39
Indebtedness Incurred pursuant to this clause (xi) and then outstanding,
shall not exceed $75 million.
(c) Notwithstanding the foregoing, the Issuer or any Note Guarantor shall
not Incur any Indebtedness pursuant to Section 4.03(b) above if the proceeds
thereof are used, directly or indirectly, to repay, prepay, redeem, defease,
retire, refund or refinance any Subordinated Obligations unless such
Indebtedness shall be subordinated to the Securities or such Note Guarantor's
Note Guarantee to at least the same extent as such Subordinated Obligations. The
Issuer shall not Incur any Indebtedness if such Indebtedness is subordinate or
junior in ranking in any respect to any Senior Indebtedness unless such
Indebtedness is Senior Subordinated Indebtedness or is expressly subordinated in
right of payment to Senior Subordinated Indebtedness. In addition, the Issuer
shall not Incur any Secured Indebtedness which is not Senior Indebtedness unless
contemporaneously therewith effective provision is made to secure the Securities
equally and ratably with (or on a senior basis to, in the case of Indebtedness
subordinated in right of payment to the Securities) such Secured Indebtedness
for so long as such Secured Indebtedness is secured by a Lien. A Note Guarantor
shall not Incur any Indebtedness if such Indebtedness is subordinate or junior
in ranking in any respect to any Senior Indebtedness of such Note Guarantor
unless such Indebtedness is Senior Subordinated Indebtedness of such Note
Guarantor or is expressly subordinated in right of payment to Senior
Subordinated Indebtedness of such Note Guarantor. In addition, a Note Guarantor
shall not Incur any Secured Indebtedness that is not Senior Indebtedness of such
Note Guarantor unless contemporaneously therewith effective provision is made to
secure the Note Guarantee of such Note Guarantor equally and ratably with (or on
a senior basis to, in the case of Indebtedness subordinated in right of payment
to such Note Guarantee) such Secured Indebtedness for as long as such Secured
Indebtedness is secured by a Lien.
(d) Notwithstanding any other provision of this Section 4.03, the maximum
amount of Indebtedness that the Company or any Restricted Subsidiary may Incur
pursuant to this Section 4.03 shall not be deemed to be exceeded solely as a
result of fluctuations in the exchange rates of currencies. For purposes of
determining the outstanding principal amount of any particular Indebtedness
Incurred pursuant to this Section 4.03, (i) Indebtedness Incurred pursuant to
the Credit Agreement prior to or on the Closing Date shall be treated as
Incurred pursuant to Section 4.03(b)(i), (ii) Indebtedness permitted by this
Section 4.03 need not be permitted solely by reference to one provision
permitting such Indebtedness but may be permitted in part by one such provision
and in part by one or more other provisions of this Section 4.03 permitting such
Indebtedness, (iii) in the event that Indebtedness meets the criteria of more
than one of the types of Indebtedness described in this Section 4.03, the
Issuer, in its sole discretion, shall classify such Indebtedness and only be
required to include the amount of such Indebtedness in one of such clauses,
provided, however, subject to clause (i) above, that at any time that the
Company or a Note Guarantor is permitted to Incur at least $1.00 of additional
Indebtedness pursuant to Section 4.03(a), the Issuer may reclassify
40
Indebtedness originally Incurred pursuant to one or more clauses of Section
4.03(b) as Indebtedness Incurred pursuant to Section 4.03(a), and (iv) for
purposes of determining compliance with any U.S. dollar denominated restriction
on the Incurrence of Indebtedness where the Indebtedness Incurred is denominated
in a different currency, the amount of such Indebtedness will be the U.S. Dollar
Equivalent determined on the date of the Incurrence of such Indebtedness,
provided, however, that if any such Indebtedness denominated in a different
currency is subject to a Currency Agreement with respect to the U.S. dollar
covering all principal, premium, if any, and interest payable on such
Indebtedness, the amount of such Indebtedness expressed in U.S. dollars shall be
as provided in such Currency Agreement. The principal amount of any Refinancing
Indebtedness Incurred in the same currency as the Indebtedness being Refinanced
shall be the U.S. Dollar Equivalent of the Indebtedness Refinanced, except to
the extent that (i) such U.S. Dollar Equivalent was determined based on a
Currency Agreement, in which case the Refinancing Indebtedness shall be
determined in accordance with the preceding sentence, and (ii) the principal
amount of the Refinancing Indebtedness exceeds the principal amount of the
Indebtedness being Refinanced, in which case the U.S. Dollar Equivalent of such
excess, shall be determined on the date such Refinancing Indebtedness is
Incurred.
SECTION 4.04. Limitation on Restricted Payments. (a) The Company shall not,
and shall not permit any Restricted Subsidiary, directly or indirectly, to (1)
declare or pay any dividend, make any distribution on or in respect of its
Capital Stock or make any similar payment (including any payment in connection
with any merger or consolidation involving the Company or any Subsidiary of the
Company) to the direct or indirect holders of its Capital Stock except (x)
dividends or distributions payable solely in its Capital Stock (other than
Disqualified Stock or, except in the case of the Company, Intermediate Holdings
or HDD Holdings, Preferred Stock), (y) dividends or distributions payable to the
Company or a Restricted Subsidiary (and, if such Restricted Subsidiary has
shareholders other than the Company or other Restricted Subsidiaries, to its
other shareholders on a pro rata basis) and (z) following a bona fide
underwritten initial public offering of Capital Stock (other than Disqualified
Stock) of Intermediate Holdings or HDD Holdings, dividends or distributions
consisting of Capital Stock of the same class and series (or convertible into
the same class and series) of Intermediate Holdings or HDD Holdings, as
applicable; (2) purchase, redeem, defease or otherwise acquire or retire for
value any Capital Stock of the Company held by any Person or any Capital Stock
of a Restricted Subsidiary held by any Affiliate of the Company (other than a
Restricted Subsidiary); (3) purchase, repurchase, redeem, retire, defease or
otherwise acquire for value, prior to scheduled maturity, scheduled repayment or
scheduled sinking fund payment any Subordinated Obligations (other than (a) the
purchase, repurchase, redemption, retirement, defeasance or other acquisition
for value of Subordinated Obligations acquired in anticipation of satisfying a
sinking fund obligation, principal installment or final maturity, in each case
due within one year of the date of acquisition and (b) Indebtedness permitted
under Section 4.03(b)(ii)); (4) make any distribution or
41
other payment (whether in cash, securities or other property or any combination
thereof) under or in respect of any Deferred Compensation Plan; or (5) make any
Investment (other than a Permitted Investment) in any Person (any such dividend,
distribution, payment, purchase, redemption, repurchase, defeasance, retirement,
or other acquisition or Investment being herein referred to as a "Restricted
Payment") if at the time the Company or such Restricted Subsidiary makes such
Restricted Payment:
(A) a Default shall have occurred and be continuing (or would result
therefrom);
(B) the Company could not Incur at least $1.00 of additional
Indebtedness under Section 4.03(a); or
(C) the aggregate amount of such Restricted Payment and all other
Restricted Payments (including, if the amount so expended is other than in
cash, the Fair Market Value of such Restricted Payments) declared or made
subsequent to the Closing Date would exceed the sum, without duplication,
of:
(i) 50% of the Consolidated Net Income accrued during the period
(treated as one accounting period) from the beginning of the fiscal
quarter immediately following the fiscal quarter during which the
Closing Date occurs to the end of the most recent fiscal quarter
ending at least 45 days prior to the date of such Restricted Payment
(or, in case such Consolidated Net Income shall be a deficit, minus
100% of such deficit);
(ii) the aggregate Net Cash Proceeds received by the Company from
contributions to its capital and from the issue or sale of its Capital
Stock (other than Disqualified Stock, Excluded Contributions or
Designated Preferred Stock) subsequent to the Closing Date (other than
an issuance or sale to (x) a Subsidiary of the Company or (y) an
employee stock ownership plan or other trust established by the
Company or any of its Subsidiaries);
(iii) the amount by which Indebtedness of the Company or the
Restricted Subsidiaries is reduced on the Company's balance sheet upon
the conversion or exchange (other than by a Subsidiary of the Company)
subsequent to the Closing Date of any Indebtedness of the Company or
its Restricted Subsidiaries issued after the Closing Date which is
convertible or exchangeable for Capital Stock (other than Disqualified
Stock) of the Company (less the amount of any cash or the Fair Market
Value of other property distributed by the Company or any Restricted
Subsidiary upon such conversion or exchange);
42
(iv) an amount equal to the sum of (x) the net reduction in
Investments (other than Permitted Investments) made by the Company or
any Restricted Subsidiary in any Person (other than the Company or a
Restricted Subsidiary) resulting from (A) Net Cash Proceeds received
from repurchases, repayments or redemptions of such Investments by
such Person, Net Cash Proceeds realized on the sale of such
Investments, Net Cash Proceeds representing the return of capital
(excluding dividends and distributions) and cash repayments of loans
or advances which constituted Restricted Payments, in each case
received by the Company or any Restricted Subsidiary or (B) to the
extent such Person is an Unrestricted Subsidiary, the merger,
consolidation or amalgamation of such Person with or into the Company
or a Restricted Subsidiary; provided, that the surviving entity is the
Company or a Restricted Subsidiary and (y) to the extent such Person
is an Unrestricted Subsidiary, the portion (proportionate to the
Company's equity interest in such Subsidiary) of the Fair Market Value
of the net assets of such Unrestricted Subsidiary at the time such
Unrestricted Subsidiary is designated a Restricted Subsidiary;
provided, however, that the foregoing sum shall not exceed, in the
case of any such Person or Unrestricted Subsidiary, the amount of
Investments (excluding Permitted Investments) previously made (and
treated as a Restricted Payment) by the Company or any Restricted
Subsidiary in such Person or Unrestricted Subsidiary; and
(v) the aggregate Net Cash Proceeds received by the Company or a
Restricted Subsidiary from the issue or sale of Capital Stock (other
than Disqualified Stock) of Intermediate Holdings or HDD Holdings in a
bona fide underwritten public offering subsequent to the Closing Date
(other than an issuance or sale to (x) the Company or a Subsidiary or
Affiliate of the Company or (y) an employee stock ownership plan or
other trust established by the Company or any of its Subsidiaries).
(b) The provisions of Section 4.04(a) shall not prohibit:
(1) any purchase, repurchase, redemption, retirement or other
acquisition for value of Capital Stock of the Company made by exchange for,
or out of the proceeds of the substantially concurrent sale of, Capital
Stock of the Company (other than Disqualified Stock and other than Capital
Stock issued or sold to a Subsidiary of the Company or an employee stock
ownership plan or other trust established by the Company or any of its
Subsidiaries); provided, however, that (A) such purchase, repurchase,
redemption, retirement or other acquisition for value shall be excluded in
the calculation of the amount of Restricted Payments and (B) the Net Cash
Proceeds from such sale applied in the manner set forth in
43
this clause (1) shall be excluded from the calculation of amounts under
Section 4.04(a)(5)(C);
(2) any prepayment, repayment, purchase, repurchase, redemption,
retirement, defeasance or other acquisition for value of Subordinated
Obligations of the Company made by exchange for, or out of the proceeds of
the substantially concurrent sale of, Indebtedness of the Company that is
permitted to be Incurred pursuant to Section 4.03(b); provided, however,
that such prepayment, repayment, purchase, repurchase, redemption,
retirement, defeasance or other acquisition for value shall be excluded in
the calculation of the amount of Restricted Payments;
(3) any prepayment, repayment, purchase, repurchase, redemption,
retirement, defeasance or other acquisition for value of Subordinated
Obligations from Net Available Cash to the extent permitted by Section
4.06; provided, however, that such prepayment, repayment, purchase,
redemption, retirement, defeasance or other acquisition for value shall be
excluded in the calculation of the amount of Restricted Payments;
(4) dividends or distributions paid within 60 days after the date of
declaration thereof if at such date of declaration such dividends or
distributions would have complied with this Section 4.04; provided,
however, that such dividends or distributions shall be included in the
calculation of the amount of Restricted Payments;
(5) any repurchase of Capital Stock deemed to occur upon exercise of
stock options if such Capital Stock represents a portion of the exercise
price of such options, provided, however, that such repurchase will be
excluded in the calculation of the amount of Restricted Payments;
(6) any purchase, repurchase, redemption, retirement or other
acquisition for value of shares of, or options to purchase shares of,
Capital Stock of the Company or any of its Subsidiaries from employees,
former employees, directors or former directors of the Company or any of
its Subsidiaries (or permitted transferees of such employees, former
employees, directors or former directors), pursuant to the terms of
agreements (including employment agreements) or plans (or amendments
thereto) approved by the Board of Directors in good faith under which such
individuals purchase or sell or are granted the option to purchase or sell,
shares of such Capital Stock; provided, however, that the aggregate amount
of such purchases, repurchases, redemptions, retirements and other
acquisitions for value will not exceed $25 million in any calendar year
(with unused amounts in any calendar year (together with any increase in
such amounts for any calendar year permitted by the following proviso)
being permitted to be carried over for the two succeeding calendar years);
provided, further, that such amount in any calendar year may be increased
by an amount not to exceed (i) the cash proceeds
44
received by the Company or any of its Restricted Subsidiaries in such
calendar year from the sale of Capital Stock of the Company or any of its
Restricted Subsidiaries (other than Disqualified Stock or Preferred Stock)
to members of management or directors of the Company or any of its
Restricted Subsidiaries that occurs after the Closing Date (provided that
the amount of such cash proceeds utilized for any such repurchase,
retirement, other acquisition or dividend will not increase the amount
available for Restricted Payments under Section 4.04(a)(5)(C)) plus (ii)
the cash proceeds of key man life insurance policies received by the
Company and its Restricted Subsidiaries in such calendar year after the
Closing Date; provided further, however, that such purchases, repurchases,
redemptions, retirements and other acquisitions for value shall be excluded
in the calculation of the amount of Restricted Payments;
(7) the declaration and payment of dividends or distributions to
holders of any class or series of Disqualified Stock of the Company or its
Restricted Subsidiaries issued or Incurred in accordance with Section 4.03;
provided, however, that such dividends or distributions shall be excluded
in the calculation of the amount of Restricted Payments;
(8) the payment of dividends on the Company's, Intermediate Holdings',
HDD Holdings' or the Issuer's common stock following the first bona fide
underwritten public offering of common stock of the Company, Intermediate
Holdings, HDD Holdings or the Issuer, as the case may be, after the Closing
Date, of up to 6% per annum of the net proceeds received by the Company,
Intermediate Holdings, HDD Holdings or the Issuer, as the case may be, from
such public offering; provided, however, that (A) the aggregate amount of
all such dividends shall not exceed the aggregate amount of net proceeds
received by the Company, Intermediate Holdings, HDD Holdings or the Issuer,
as the case may be, from such public offering and (B) such dividends shall
be included in the calculation of the amount of Restricted Payments;
(9) the payment of annual management, consulting, monitoring and
advisory fees to any of the Sponsors; provided, that any such payment is
permitted by Section 4.07; provided, further, that any such payment shall
be excluded in the calculation of the amount of Restricted Payments;
(10) the declaration and payment of dividends to holders of any class
or series of Designated Preferred Stock issued after the Closing Date;
provided, however, that (A) for the most recently ended four full fiscal
quarters for which internal financial statements are available immediately
preceding the declaration of any such dividend after giving effect to such
dividend on a pro forma basis, the Consolidated Coverage Ratio would have
been at least 5.0:1 and (B) the aggregate
45
amount of dividends declared and paid pursuant to this clause (10) shall
not exceed the Net Cash Proceeds received by the Company from the sale of
Designated Preferred Stock issued after the Closing Date; provided,
further, that such dividends shall be excluded in the calculation of the
amount of Restricted Payments;
(11) payments which are contemplated by the Stock Purchase Agreement,
the Indemnification Agreement and the Shareholders' Agreement and the
related transactions on the terms described in the Offering Memorandum,
including the payment of retention bonuses to senior managers of the
Company and its Subsidiaries; provided, however, that such payments shall
be excluded in the calculation of the amount of Restricted Payments;
(12) Investments that are made with Excluded Contributions; provided,
however, that such Investments shall be excluded in the calculation of the
amount of Restricted Payments;
(13) the declaration and payment of dividends or distributions on the
Company's Capital Stock or payments in respect of Deferred Compensation
Plans (i) consisting of Capital Stock (other than Disqualified Stock or
Preferred Stock) of an Existing Unrestricted Entity or (ii) with the Net
Cash Proceeds, property, assets or other forms of consideration received by
the Company or a Restricted Subsidiary from the issue or sale of Capital
Stock (other than Disqualified Stock or Preferred Stock) of an Existing
Unrestricted Entity (other than an issuance or sale to (x) the Company or a
Subsidiary or Affiliate of the Company or (y) an employee stock ownership
plan or other trust established by the Company or any of its Subsidiaries);
provided that (A) no Default shall have occurred and be continuing or would
occur as a result of such dividend or distribution, (B) with respect to any
dividend or distribution made with consideration received by the Company or
a Restricted Subsidiary as described in clause (ii) above, if the
consideration for such issue or sale consists, in whole or in part, of any
property, assets or other form of consideration other than cash, such
dividends or distributions shall be paid in the form of cash, property,
assets or such other form of consideration such that the relative
proportions of cash, property, assets and such other form of consideration
comprising such dividend or distribution shall be the same as the relative
proportions of cash, property, assets and such other form of consideration
comprising the consideration received upon such issue or sale, (C) with
respect to dividends or distributions in the form of Capital Stock (other
than Disqualified Stock or Preferred Stock) of an Existing Unrestricted
Entity, such Existing Unrestricted Entity shall have previously consummated
a bona fide underwritten initial public offering of Capital Stock (other
than Disqualified Stock or Preferred Stock) of the same class and series as
the Capital Stock to be dividended or distributed (or into which the
Capital Stock to be dividended or
46
distributed is convertible) registered under the Securities Act, (D) such
dividends or distributions shall be excluded in the calculation of the
amount of Restricted Payments and (E) the Net Cash Proceeds and any value
attributable to any property, assets or other form of consideration
received in connection with such issue or sale described in clause (ii)
above shall be excluded from the calculation of amounts under Section
4.04(a)(5)(C);
(14) the declaration and payment of dividends on the Company's Capital
Stock within 30 days after the end of any calendar year for the purpose of
providing the holders of the Company's Capital Stock (the "Equity Holders")
with cash (or Publicly Traded Equity Securities) to pay United States
income taxes attributable to taxable income of the Company and its
Subsidiaries for such calendar year attributed to the Equity Holders (such
dividends, "Tax Distributions"); provided that (A) on the date of each such
declaration and payment the Company is treated as a pass-through entity for
United States Federal income tax purposes or a controlled foreign
corporation for United States Federal income tax purposes, (B) the maximum
amount of Tax Distributions that may be declared and paid pursuant to this
clause (14) in any calendar year shall be equal to (x)(a) if the Company is
a pass-through entity for United States Federal income tax purposes, the
amount of taxable income of the Company for such calendar year (for the
purposes of the calculation made pursuant to this clause (B)(x)(a), the
taxable income of the Company shall be assumed to be the taxable income the
Company would have had if it were a corporation incorporated in the United
States, including any "Subpart F income" (within the meaning of Section 952
of the Code, which for the purposes of this clause (14) shall include
income includable under Section 951(a)(1)(B) of the Code) of its
subsidiaries that it would be required to include in its taxable income if
it were such a corporation), reduced by the amount of taxable loss
allocated to the Equity Holders for all prior calendar years (except to the
extent such taxable losses have been previously taken into account with
respect to a prior calendar year under this clause (B)(x)(a)) or (b) if the
Company is a controlled foreign corporation, the aggregate amount of the
Company's Subpart F income for such calendar year (and, to the extent such
Subpart F income would be attributed to the Equity Holders, the Subpart F
income of the Company's subsidiaries for such calendar year), multiplied by
(y) 40%, (C) the Company shall have delivered to the Trustee at least 30
calendar days prior to the declaration of such Tax Distribution or any
interim Tax Distribution pursuant to clause (F) below, a notice, certified
by the Chief Financial Officer of the Company, setting forth in detail
reasonably satisfactory to the Trustee the basis for the determination of
the amount of such Tax Distribution, (D) if any Tax Distribution is made
pursuant to this clause (14) in respect of any taxable income realized on
any sale of any asset or Capital Stock, the consideration for which
consists in whole or in part of Publicly
47
Traded Equity Securities, such Tax Distribution shall be made in the form
of cash and Publicly Traded Equity Securities such that the ratio of cash
to Publicly Traded Equity Securities comprising such Tax Distribution shall
be the same as the ratio of cash to Publicly Traded Equity Securities
comprising the consideration received upon such sale, to the extent that
the Company is legally permitted to make such Tax Distribution in any form
other than cash, (E) Tax Distributions in respect of any taxes attributable
to the taxable income of an Unrestricted Subsidiary shall only be permitted
if they are made with the proceeds of dividends or distributions from an
Unrestricted Subsidiary that are received by the Company or a Restricted
Subsidiary; provided, that the amount of such dividends and distributions
will not increase the amount available for Restricted Payments under
Section 4.04(a)(5)(C), (F)(i) interim Tax Distributions may be made during
each calendar year on or shortly after April 10, June 10, September 10 and
December 31 of such year for the purpose of providing the Equity Holders
with cash to pay estimated United States income taxes attributable to
taxable income of the Company and its Subsidiaries for such taxable year,
based on good-faith estimates of such estimated tax liability made by the
Company and (ii) if any such interim Tax Distributions are made by the
Company during a taxable year, then within 30 calendar days after the end
of such calendar year the Company shall deliver to the Trustee a
determination of the maximum amount of Tax Distributions that may be made
for such calendar year under clause (B) above, and if the aggregate interim
Tax Distributions made for such calendar year exceed such maximum, then
such excess amount ("Excess Interim Tax Distributions") shall be applied to
reduce amounts payable under any clause of paragraph (b) for the next
calendar year and to the extent not so applied, shall be carried forward
for application against such amounts in a future calendar year, and (G)(i)
any Tax Distributions (excluding any Excess Interim Tax Distributions) paid
pursuant to this clause (14) shall be excluded in the calculation of the
amount of Restricted Payments and (ii) any Excess Interim Tax Distributions
shall be included in the amount of Restricted Payments;
(15) the declaration and payment of dividends or distributions on the
Company's Capital Stock or payments in respect of Deferred Compensation
Plans with the Net Cash Proceeds received by the Company or a Restricted
Subsidiary (other than a Designated Subsidiary) from an issue or sale
(other than an issuance or sale to (x) the Company or a Subsidiary or
Affiliate of the Company or (y) an employee stock ownership plan or other
trust established by the Company or any of its Subsidiaries) of Capital
Stock (other than Preferred Stock or Disqualified Stock) of a Designated
Subsidiary in an amount equal to such Net Cash Proceeds from such issuance
or sale less the aggregate amount of all Investments (other than
Investments which may be deemed to have been made as a result of services
performed in the ordinary course of business) in such Designated Subsidiary
made by the Company or a Restricted Subsidiary that are outstanding at such
time (with the amount of any Investment being measured at the time such
Investment was
48
made and not giving effect to any subsequent changes in value subject to
Section 4.17) (such aggregate amount being hereinafter called "Designated
Subsidiary Investments"); provided, however, that (A) after giving effect
to such dividend or distribution or payments, the Company would be able to
Incur an additional $1.00 of Indebtedness under Section 4.03(a), (B) at
least 50% of the term loans under the Credit Agreement outstanding on the
Closing Date (and any Indebtedness Refinancing such term loans) shall have
been repaid, (C) the long-term senior unsecured debt of the Issuer shall be
rated at least (x) Baa3 by Moody's and (y) BBB- by S&P, and each of Moody's
and S&P shall have reaffirmed its rating of the long-term senior unsecured
debt of the Issuer after having been informed of such dividend,
distribution or payment and (D) no Default shall have occurred and be
continuing or would occur as a result of such dividend or distribution;
provided, further, that (X) such Net Cash Proceeds shall be excluded from
the calculation of amounts under Section 4.04(a)(5)(C) and (Y) such
dividends or distributions shall be excluded in the calculation of the
amount of Restricted Payments;
(16) the declaration and payment of dividends or distributions on the
Company's Capital Stock or payments in respect of Deferred Compensation
Plans (i) consisting of Capital Stock (other than Disqualified Stock or
Preferred Stock) of a Designated Subsidiary or (ii) in the form of Publicly
Traded Equity Securities received by the Company or a Restricted Subsidiary
(other than a Designated Subsidiary) from the issuer of such Publicly
Traded Equity Securities as consideration for the issue or sale of Capital
Stock (other than Preferred Stock or Disqualified Stock) of a Designated
Subsidiary; provided, however, that (A) with respect to dividends or
distributions in the form of Capital Stock (other than Disqualified Stock
or Preferred Stock) of a Designated Subsidiary as described in clause (i)
above, such Designated Subsidiary shall have previously consummated a bona
fide underwritten initial public offering of Capital Stock (other than
Disqualified Stock or Preferred Stock) of the same class and series as the
Capital Stock to be dividended or distributed (or into which the Capital
Stock to be dividended or distributed is convertible) registered under the
Securities Act, (B) the Company or a Restricted Subsidiary (other than a
Designated Subsidiary) shall retain a portion of (I) in the event of a
dividend or distribution in the form of Capital Stock (other than
Disqualified Stock or Preferred Stock) of a Designated Subsidiary as
described in clause (i) above, the Capital Stock of such Designated
Subsidiary or (II) in the event of a dividend or distribution of Publicly
Traded Equity Securities received as consideration for the sale of Capital
Stock of a Designated Subsidiary as described in clause (ii) above, such
Publicly Traded Equity Securities, in each case having a Fair Market Value
at least equal to the amount of Designated Subsidiary Investments
outstanding at such time, (C) after giving effect to such dividend or
distribution the Company would be able to Incur an additional $1.00 of
Indebtedness under Section 4.03(a), (D) at least 50% of the
49
term loans under the Credit Agreement outstanding on the Closing Date (and
any Indebtedness Refinancing such term loans) shall have been repaid, (E)
the long-term senior unsecured debt of the Issuer shall be rated at least
(x) Baa3 by Moody's and (y) BBB- by S&P, and each of Moody's and S&P shall
have reaffirmed its rating on the long-term senior unsecured debt of the
Issuer after having been informed of such dividend, distribution or payment
and (F) no Default shall have occurred and be continuing or would occur as
a result of such dividend or distribution; provided, further, that (X) any
value attributable to such Publicly Traded Equity Securities received as
described in clause (ii) above shall be excluded from the calculation of
amounts under Section 4.04(a)(5)(C) and (Y) such dividends or distributions
shall be excluded in the calculation of the amount of Restricted Payments;
and
(17) other Restricted Payments in an aggregate amount not to exceed
$25 million; provided, however, that such Restricted Payments shall be
excluded in the calculation of the amount of Restricted Payments.
SECTION 4.05. Limitation on Restrictions on Distributions from Restricted
Subsidiaries. The Company shall not, and shall not permit any Restricted
Subsidiary to, create or otherwise cause or permit to exist or become effective
any consensual encumbrance or restriction on the ability of any Restricted
Subsidiary to (1) pay dividends or make any other distributions on its Capital
Stock or pay any Indebtedness or other obligations owed to the Company or any
Restricted Subsidiary, (2) make any loans or advances to the Company or any
Restricted Subsidiary or (3) transfer any of its property or assets to the
Company or any Restricted Subsidiary, except:
(A) any encumbrance or restriction pursuant to applicable law, rule,
regulation, or order or an agreement in effect at or entered into on the
Closing Date;
(B) any encumbrance or restriction with respect to a Restricted
Subsidiary pursuant to an agreement relating to any Indebtedness Incurred
by such Restricted Subsidiary prior to the date on which such Restricted
Subsidiary was acquired by the Company (other than Indebtedness Incurred as
consideration in, in contemplation of, or to provide all or any portion of
the funds or credit support utilized to consummate the transaction or
series of related transactions pursuant to which such Restricted Subsidiary
became a Restricted Subsidiary or was otherwise acquired by the Company)
and outstanding on such date;
(C) in the case of clause (3), any encumbrance or restriction
50
(i) that restricts in a customary manner the subletting,
assignment or transfer of any property or asset that is subject to a
lease, license or similar contract, or
(ii) contained in security agreements or mortgages securing
Indebtedness of a Restricted Subsidiary to the extent such encumbrance
or restriction restricts the transfer of the property subject to such
security agreements or mortgages;
(D) with respect to a Restricted Subsidiary, any restriction imposed
pursuant to an agreement entered into for the sale or disposition of all or
substantially all the Capital Stock or assets of such Restricted Subsidiary
pending the closing of such sale or disposition;
(E) any encumbrance or restriction on cash or other deposits or net
worth imposed by customers under contracts entered into in the ordinary
course of business;
(F) customary provisions in joint venture agreements and other similar
agreements entered into in the ordinary course of business;
(G) any encumbrance or restriction contained in an agreement
evidencing Indebtedness of a Restricted Subsidiary permitted to be Incurred
subsequent to the Closing Date pursuant to Section 4.03; provided, however,
that such encumbrance or restriction applies only in the event of and
during the continuance of a default contained in such agreement; and
(H) any encumbrances or restrictions of the type referred to in
clauses (1), (2) and (3) above imposed by any amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or
refinancings of the contracts, instruments or obligations referred to in
clauses (A) through (G) above; provided that such amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings are, in the good faith judgment of the Board
of Directors, no more restrictive with respect to such dividend and other
payment restrictions than those contained in the dividend or other payment
restrictions prior to such amendment, modification, restatement, renewal,
increase, supplement, refunding, replacement or refinancing.
SECTION 4.06. Limitation on Sales of Assets and Capital Stock. (a) The
Company shall not, and shall not permit any Restricted Subsidiary to, make any
Asset Disposition unless (1) the Company or such Restricted Subsidiary receives
consideration (including by way of relief from, or by any other Person assuming
sole responsibility for, any liabilities, contingent or otherwise) at the time
of such Asset Disposition at least
51
equal to the Fair Market Value of the shares and assets subject to such Asset
Disposition, (2) at least 75% of the consideration thereof received by the
Company or such Restricted Subsidiary is in the form of cash or Temporary Cash
Investments and (3) an amount equal to 100% of the Net Available Cash from such
Asset Disposition is applied by the Company (or such Restricted Subsidiary, as
the case may be) (A) to the extent the Company elects (or is required by the
terms of any Indebtedness), to prepay, repay, purchase, repurchase, redeem,
retire, defease or otherwise acquire for value Senior Indebtedness of the
Company or a Note Guarantor or Indebtedness (other than obligations in respect
of Preferred Stock) of a Wholly Owned Subsidiary other than the Issuer or a Note
Guarantor (in each case other than Indebtedness owed to the Company or an
Affiliate of the Company and other than obligations in respect of Disqualified
Stock) within one year after the later of the date of such Asset Disposition or
the receipt of such Net Available Cash; (B) to the extent the Company or such
Restricted Subsidiary elects, to reinvest in Additional Assets (including by
means of an Investment in Additional Assets by a Restricted Subsidiary with Net
Available Cash received by the Company or another Restricted Subsidiary) within
one year from the later of such Asset Disposition or the receipt of such Net
Available Cash; (C) to the extent of the balance of such Net Available Cash
after application in accordance with clauses (A) and (B), to make an Offer (as
defined in Section 4.06(b)) to purchase Securities pursuant to and subject to
the conditions set forth in Section 4.06(b); provided, however, that if the
Issuer elects (or is required by the terms of any other Senior Subordinated
Indebtedness), such Offer may be made ratably to purchase the Securities and
other Senior Subordinated Indebtedness of the Issuer; and (D) to the extent of
the balance of such Net Available Cash after application in accordance with
clauses (A), (B) and (C), for any general corporate purpose permitted by the
terms of this Indenture; provided, however that (X) in connection with any
prepayment, repayment, purchase, repurchase, redemption, retirement, defeasance
or other acquisition for value of Indebtedness pursuant to clause (A), (C) or
(D) above, the Company or such Restricted Subsidiary shall retire such
Indebtedness and shall cause the related loan commitment (if any) to be
permanently reduced in an amount equal to the principal amount so prepaid,
repaid, purchased, repurchased, redeemed, retired, defeased or otherwise
acquired for value and (Y) any Asset Disposition consisting of the sale of
Capital Stock of a Designated Subsidiary shall not be subject to Section
4.06(a)(3). Notwithstanding the foregoing provisions of this Section 4.06, the
Company and the Restricted Subsidiaries shall not be required to apply any Net
Available Cash in accordance with this Section 4.06(a) except to the extent that
the aggregate Net Available Cash from all Asset Dispositions that is not applied
in accordance with this Section 4.06(a) exceeds $15,000,000.
For the purposes of this Section 4.06, the following are deemed to be cash:
(A) the assumption of Indebtedness of (i) the Issuer (other than obligations in
respect of Disqualified Stock of the Issuer) or (ii) the Company or any
Restricted Subsidiary other than the Issuer (other than obligations in respect
of Disqualified Stock and Preferred Stock of the Company or a Restricted
Subsidiary that is a Note Guarantor) and the release
52
of the Issuer, the Company or such Restricted Subsidiary from all liability on
such Indebtedness in connection with such Asset Disposition, (B) securities
received by the Company or any Restricted Subsidiary in an Asset Disposition
from the transferee with respect to which the Company or such Restricted
Subsidiary shall use its reasonable best efforts to convert into cash within 90
days after the later to occur of (i) the consummation of such Asset Disposition
or (ii) the expiration of any lock-up or similar restriction on the right of the
Company or such Restricted Subsidiary to dispose of such securities; provided,
that all the cash received upon such conversion shall be Net Available Cash for
the purposes of, and applied in accordance with, this Section 4.06, (C) any
assets related to a Permitted Business received in exchange for assets of
comparable Fair Market Value in the good faith determination of the Board of
Directors of the Company, and (D) Publicly Traded Equity Securities that are
received in exchange for a sale of Capital Stock (other than Preferred Stock or
Disqualified Stock) of a Designated Subsidiary.
(b) In the event of an Asset Disposition that requires the purchase of
Securities pursuant to Section 4.06(a)(3)(C), the Issuer shall be required (i)
to purchase Securities tendered pursuant to an offer by the Issuer for the
Securities (the "Offer") at a purchase price of 100% of their principal amount
plus accrued and unpaid interest and liquidated damages thereon, if any, to the
date of purchase (subject to the right of Holders of record on the relevant date
to receive interest due on the relevant interest payment date) in accordance
with the procedures (including prorating in the event of oversubscription), set
forth in Section 4.06(c) and (ii) to purchase other Senior Subordinated
Indebtedness of the Issuer on the terms and to the extent contemplated thereby
(provided that in no event shall the Issuer offer to purchase such other Senior
Subordinated Indebtedness of the Issuer at a purchase price in excess of 100% of
its principal amount, plus accrued and unpaid interest thereon). If the
aggregate purchase price of Securities (and other Senior Subordinated
Indebtedness) tendered pursuant to the Offer is less than the Net Available Cash
allotted to the purchase of the Securities (and other Senior Subordinated
Indebtedness), the Issuer shall apply the remaining Net Available Cash in
accordance with Section 4.06(a)(3)(D). The Issuer shall not be required to make
an Offer for Securities (and other Senior Subordinated Indebtedness) pursuant to
this Section 4.06 if the Net Available Cash available therefor (after
application of the proceeds as provided in clauses (A) and (B) of Section
4.06(a)(3)) is less than $15 million for any particular Asset Disposition (which
lesser amount shall be carried forward for purposes of determining whether an
Offer is required with respect to the Net Available Cash from any subsequent
Asset Disposition).
(c) (i) Promptly, and in any event within 10 days after the Issuer becomes
obligated to make an Offer, the Issuer shall deliver to the Trustee and send, by
first-class mail to each Holder, a written notice stating that the Holder may
elect to have his Securities purchased by the Issuer either in whole or in part
(subject to prorating as hereinafter described in the event the Offer is
oversubscribed) in integral multiples of $1,000 of principal amount, at the
applicable purchase price. The notice shall specify a
53
purchase date not less than 30 days nor more than 60 days after the date of such
notice (the "Purchase Date") and shall contain such information concerning the
business of the Company which the Issuer in good faith believes will enable such
Holders to make an informed decision (which at a minimum shall include (1) the
most recently filed Annual Report on Form 10-K (including audited consolidated
financial statements) of the Company, the most recent subsequently filed
Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company
filed subsequent to such Quarterly Report, other than Current Reports describing
Asset Dispositions otherwise described in the offering materials (or
corresponding successor reports), (2) a description of material developments in
the Company's business subsequent to the date of the latest of such reports, and
(3) if material, appropriate pro forma financial information) and all
instructions and materials necessary to tender Securities pursuant to the Offer,
together with the address referred to in Section 4.06(c)(iii).
(ii) Not later than the date upon which written notice of an Offer is
delivered to the Trustee as provided above, the Issuer shall deliver to the
Trustee an Officers' Certificate as to (1) the amount of the Offer (the "Offer
Amount"), (2) the allocation of the Net Available Cash from the Asset
Dispositions pursuant to which such Offer is being made and (3) the compliance
of such allocation with the provisions of Section 4.06(a). On such date, the
Issuer shall also irrevocably deposit with the Trustee or with a paying agent
(or, if the Issuer is acting as its own paying agent, segregate and hold in
trust) an amount equal to the Offer Amount to be invested in Temporary Cash
Investments and to be held for payment in accordance with the provisions of this
Section. Upon the expiration of the period for which the Offer remains open (the
"Offer Period"), the Issuer shall deliver to the Trustee for cancelation the
Securities or portions thereof that have been properly tendered to and are to be
accepted by the Issuer. The Trustee (or the Paying Agent, if not the Trustee)
shall, on the date of purchase, mail or deliver payment to each tendering Holder
in the amount of the purchase price. In the event that the Offer Amount
delivered by the Issuer to the Trustee is greater than the purchase price of the
Securities (and other Senior Subordinated Indebtedness) tendered, the Trustee
shall deliver the excess to the Issuer immediately after the expiration of the
Offer Period for application in accordance with this Section 4.06.
(iii) Holders electing to have a Security purchased shall be required to
surrender the Security, with an appropriate form duly completed, to the Issuer
at the address specified in the notice at least three Business Days prior to the
Purchase Date. Holders shall be entitled to withdraw their election if the
Trustee or the Issuer receives not later than one Business Day prior to the
Purchase Date, a facsimile transmission or letter setting forth the name of the
Holder, the principal amount of the Security which was delivered by the Holder
for purchase and a statement that such Holder is withdrawing his election to
have such Security purchased. If at the expiration of the Offer Period the
aggregate principal amount of Securities and any other Senior Subordinated
Indebtedness included in the Offer surrendered by holders thereof exceeds the
Offer Amount, the Issuer
54
shall select the Securities and other Senior Subordinated Indebtedness to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Issuer so that only Securities and other Senior Subordinated
Indebtedness in denominations of $1,000, or integral multiples thereof, shall be
purchased). Holders whose Securities are purchased only in part will be issued
new Securities equal in principal amount to the unpurchased portion of the
Securities surrendered.
(iv) At the time the Issuer delivers Securities to the Trustee which are to
be accepted for purchase, the Issuer shall also deliver an Officers' Certificate
stating that such Securities are to be accepted by the Issuer pursuant to and in
accordance with the terms of this Section 4.06. A Security shall be deemed to
have been accepted for purchase at the time the Trustee, directly or through an
agent, mails or delivers payment therefor to the surrendering Holder.
(v) The Issuer shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
Section. To the extent that the provisions of any securities laws or regulations
conflict with provisions of this Section, the Issuer shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section by virtue thereof.
SECTION 4.07. Limitation on Transactions with Affiliates. (a) The Company
shall not, and shall not permit any Restricted Subsidiary to, directly or
indirectly, enter into or conduct any transaction or series of related
transactions (including, the purchase, sale, lease or exchange of any property
or the rendering of any service) with any Affiliate of the Company (an
"Affiliate Transaction") unless such transaction is on terms (1) that are no
less materially favorable to the Company or such Restricted Subsidiary, as the
case may be, than those that could be obtained at the time of such transaction
in arm's-length dealings with a Person who is not such an Affiliate, (2) that,
in the event such Affiliate Transaction involves an aggregate amount in excess
of $25 million, (A) are set forth in writing and (B) have been approved by a
majority of the members of the Board of Directors having no personal stake in
such Affiliate Transaction and (3) that, in the event such Affiliate Transaction
involves an amount in excess of $50 million, have been determined by a
nationally recognized appraisal or investment banking firm to be fair, from a
financial standpoint, to the Company and its Restricted Subsidiaries.
(b) The provisions of Section 4.07(a) shall not prohibit (1) any Restricted
Payment permitted to be paid pursuant to Section 4.04, (2) any issuance of
securities, or other payments, awards or grants in cash, securities or otherwise
pursuant to, or the funding of, employment arrangements, stock options and stock
ownership plans approved by the Board of Directors in good faith, (3) the grant
of stock options or similar rights to
55
employees and directors of the Company or any of its Restricted Subsidiaries
pursuant to plans approved by the Board of Directors in good faith, (4) loans or
advances to employees, directors or consultants in the ordinary course of
business, which are approved by the Board of Directors in good faith in an
amount not to exceed $10 million outstanding at any one time, (5) the payment of
reasonable and customary fees to, and indemnity provided on behalf of, officers,
directors, employees or consultants of the Company and its Subsidiaries, (6) any
transaction between the Company and a Restricted Subsidiary or between
Restricted Subsidiaries, (7) the existence of, or the performance by the Company
or any of its Restricted Subsidiaries of its obligations under the terms of, any
stockholders agreement (including any registration rights agreement or purchase
agreement related thereto) to which it is a party as of the Closing Date on the
terms described in the Offering Memorandum and any similar agreements which it
may enter into thereafter; provided, however, that the existence of, or the
performance by the Company or any of its Restricted Subsidiaries of its
obligations under, any future amendment to such existing agreement or under any
similar agreement entered into after the Closing Date shall only be permitted by
this clause (7) to the extent that the terms of any such amendment or new
agreement are not disadvantageous to the Holders of the Securities in any
material respect, (8) the issuance or sale of Capital Stock (other than
Disqualified Stock) of the Company, Intermediate Holdings, HDD Holdings or the
Issuer to any Permitted Holder, (9) the payment by the Company or any of its
Restricted Subsidiaries of (i) annual management, consulting, monitoring and
advisory fees and any related and reasonable out-of-pocket expenses to any of
the Sponsors in an aggregate amount, for all the Sponsors, not to exceed $5
million in any calendar year and (ii) fees to any of the Sponsors paid for any
financial advisory, financing, underwriting or placement services including,
without limitation, in connection with any acquisition transaction or
divestiture entered into by the Company or any Restricted Subsidiary; provided,
however, that the aggregate amount of fees paid to all of the Sponsors under
this clause (ii) in respect of any transaction shall not exceed the lesser of
(A) 25% of the total amount of such transaction and (B) the greater of 2% of the
total amount of such transaction and $2 million, (10) transactions with
customers, clients, suppliers or purchasers or sellers of goods or services in
each case in the ordinary course of business and otherwise in compliance with
the terms of this Indenture which are fair to the Company or its Restricted
Subsidiaries, in the good faith determination of the Board of Directors or the
senior management thereof, or are on terms at least as favorable as might
reasonably have been obtained at such time from an unaffiliated party, (11) any
agreement as in effect as of the Closing Date on the terms described in the
Offering Memorandum or any amendment thereto (so long as any such amendment is
not disadvantageous to the Holders of the Securities in any material respect) or
any transaction contemplated thereby, (12) the payment of all fees and expenses
related to the Transactions, including fees to each of the Sponsors, on the
terms described in the Offering Memorandum, or (13) any licensing agreement or
similar agreement entered into in the ordinary course of business relating to
the use of technology or intellectual property between any of the Company and
its Subsidiaries, on the one hand, and any company or other Person which is an
Affiliate
56
of the Company or its Subsidiaries by virtue of the fact that a Sponsor has made
an Investment in or owns any Capital Stock of such company or other Person which
are fair to the Company or its Restricted Subsidiaries, in the reasonable
determination of the Board of Directors or the senior management thereof, or are
on terms at least as favorable as might reasonably have been obtained at such
time from an unaffiliated party.
SECTION 4.08. Change of Control. (a) Upon the occurrence of any, or if
applicable, each Change of Control, each Holder shall have the right to require
that the Issuer purchase all or any part of such Holder's Securities at a
purchase price in cash equal to 101% of the principal amount thereof plus
accrued and unpaid interest and liquidated damages, if any, to the date of
purchase (subject to the right of Holders of record on the relevant record date
to receive interest and liquidated damages, if any, due on the relevant interest
payment date), in accordance with the terms contemplated in Section 4.08(b);
provided, however, that notwithstanding the occurrence of a Change of Control,
the Issuer shall not be obligated to purchase the Securities pursuant to this
Section 4.08 in the event that it has exercised its right to redeem all the
Securities under paragraph 5 of the Securities. In the event that at the time of
such Change of Control the terms of the Bank Indebtedness restrict or prohibit
the repurchase of Securities pursuant to this Section 4.08, then prior to the
mailing of the notice to Holders provided for in Section 4.08(b) below but in
any event within 30 days following any Change of Control, the Issuer shall (i)
repay in full all Bank Indebtedness or, if doing so will allow the purchase of
Securities, offer to repay in full all Bank Indebtedness and repay the Bank
Indebtedness of each lender who has accepted such offer or (ii) obtain the
requisite consent under the agreements governing the Bank Indebtedness to permit
the repurchase of the Securities as provided for in Section 4.08(b). If the
Issuer does not repay Bank Indebtedness in accordance with clause (i) of the
immediately preceding sentence or obtain the requisite consents in accordance
with clause (ii) of the immediately preceding sentence, then the Issuer will
remain prohibited from repurchasing Securities pursuant to this Section 4.08,
and the Issuer's failure to purchase Securities shall constitute an Event of
Default under Section 6.01(d).
(b) Within 30 days following any Change of Control (except as provided in
the proviso to the first sentence of Section 4.08(a)), the Issuer shall mail a
notice to each Holder with a copy to the Trustee (the "Change of Control Offer")
stating:
(i) that a Change of Control has occurred and that such Holder has the
right to require the Issuer to purchase all or a portion of such Holder's
Securities at a purchase price in cash equal to 101% of the principal
amount thereof, plus accrued and unpaid interest and liquidated damages, if
any, to the date of purchase (subject to the right of Holders of record on
the relevant record date to receive interest and liquidated damages, if
any, on the relevant interest payment date);
57
(ii) the circumstances and relevant facts and financial information
regarding such Change of Control;
(iii) the purchase date (which shall be no earlier than 30 days nor
later than 60 days from the date such notice is mailed); and
(iv) the instructions determined by the Issuer, consistent with this
Section, that a Holder must follow in order to have its Securities
purchased.
(c) Holders electing to have a Security purchased shall be required to
surrender the Security, with an appropriate form duly completed, to the Issuer
at the address specified in the notice at least three Business Days prior to the
purchase date. Holders shall be entitled to withdraw their election if the
Trustee or the Issuer receives not later than one Business Day prior to the
purchase date a facsimile transmission or letter setting forth the name of the
Holder, the principal amount of the Security which was delivered for purchase by
the Holder and a statement that such Holder is withdrawing his election to have
such Security purchased. Holders whose Securities are purchased only in part
shall be issued new Securities equal in principal amount to the unpurchased
portion of the Securities surrendered.
(d) On the purchase date, all Securities purchased by the Issuer under this
Section shall be delivered to the Trustee for cancelation, and the Issuer shall
pay the purchase price plus accrued and unpaid interest and liquidated damages,
if any, to the Holders entitled thereto.
(e) Notwithstanding the foregoing provisions of this Section, the Issuer
shall not be required to make a Change of Control Offer upon a Change of Control
if a third party makes the Change of Control Offer in the manner, at the times
and otherwise in compliance with the requirements set forth in Section 4.08(b)
applicable to a Change of Control Offer made by the Issuer and purchases all
Securities validly tendered and not withdrawn under such Change of Control
Offer.
(f) At the time the Issuer delivers Securities to the Trustee which are to
be accepted for purchase, the Issuer shall also deliver an Officers' Certificate
stating that such Securities are to be accepted by the Issuer pursuant to and in
accordance with the terms of this Section 4.08. A Security shall be deemed to
have been accepted for purchase at the time the Trustee, directly or through an
agent, mails or delivers payment therefor to the surrendering Holder.
(g) The Issuer shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
Section. To the extent that the provisions of any securities laws or regulations
conflict with provisions
58
of this Section, the Issuer shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under this
Section by virtue thereof.
SECTION 4.09. Compliance Certificate. The Issuer shall deliver to the
Trustee within 120 days after the end of each fiscal year of the Issuer an
Officers' Certificate stating that in the course of the performance by the
signers of their duties as Officers of the Issuer they would normally have
knowledge of any Default and whether or not the signers know of any Default that
occurred during such period. If they do, the certificate shall describe the
Default, its status and what action the Issuer is taking or proposes to take
with respect thereto. The Issuer also shall comply with Section 314(a)(4) of the
TIA.
SECTION 4.10. Further Instruments and Acts. Upon request of the Trustee,
the Issuer shall execute and deliver such further instruments and do such
further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
SECTION 4.11. Future Note Guarantors. The Company shall cause (i) at any
time that any Bank Indebtedness is outstanding, each Subsidiary of the Company
(other than the Issuer) that Incurs or enters into a Guarantee of any Bank
Indebtedness and (ii) at any time that no Bank Indebtedness is outstanding, each
Restricted Subsidiary of the Company (other than the Issuer) that Incurs any
Indebtedness, to become a Note Guarantor, and, if applicable, execute and
deliver to the Trustee a supplemental indenture substantially in the form of
Exhibit C pursuant to which such Restricted Subsidiary will Guarantee payment of
the Securities.
SECTION 4.12. Additional Amounts. The Issuer, which shall include any
Successor Company (as such term is defined in Section 5.01(a)(i)), shall make
all its payments under or with respect to the Securities and each Note
Guarantor, which shall include any Successor Guarantor (as such term is defined
in Section 5.01(b)(i)), shall make all payments under or with respect to the
Note Guarantees free and clear of and without withholding or deduction for or on
account of any present or future tax, duty, levy, impost, assessment or other
governmental charge (including penalties, interest and other liabilities related
thereto) (hereinafter "Taxes") imposed or levied by or on behalf of the
government of the Cayman Islands or any political subdivision or any authority
or agency therein or thereof having power to tax, or within any other
jurisdiction in which it is organized or is otherwise resident for tax purposes
or any jurisdiction from or through which payment is made (each a "Relevant
Taxing Jurisdiction"), unless the Issuer or any Note Guarantor, as the case may
be, is required to withhold or deduct Taxes by law or by the interpretation or
administration thereof. If the Issuer or any Note Guarantor is so required to
withhold or deduct any amount for or on account of Taxes imposed by a Relevant
Taxing Jurisdiction from any payment made under or with respect to the
59
Securities or the Note Guarantees, the Issuer or the applicable Note Guarantor
shall pay such additional amounts ("Additional Amounts") as may be necessary so
that the net amount received by each Holder (including Additional Amounts) after
such withholding or deduction shall not be less than the amount such Holder
would have received if such Taxes had not been withheld or deducted; provided,
however, that the foregoing obligation to pay Additional Amounts shall not apply
to (1) any Taxes that would not have been so imposed but for the existence of
any present or former connection between the relevant Holder (or between a
fiduciary, settlor, beneficiary, member or shareholder of, or possessor of power
over the relevant Holder, if the relevant Holder is an estate, nominee, trust or
corporation) and the Relevant Taxing Jurisdiction (other than the mere receipt
of such payment or the ownership or holding outside of the Cayman Islands of
such Securities but including, without limitation, such relevant Holder (or such
fiduciary, settlor, beneficiary, member or shareholder or possessor) being or
having been a citizen or resident thereof or being or having been present or
engaged in a trade or business therein or having or having had a permanent
establishment therein); or (2) any estate, inheritance, gift, sales, excise,
transfer, personal property tax or similar tax, assessment or governmental
charge; (3) any tax, assessment or other governmental charge that is imposed or
withheld by reason of the failure by the Holder or the beneficial owner of the
Securities to comply with a request of the Issuer or any Note Guarantor, as the
case may be, addressed to the Holder (x) to provide information, documents or
other evidence concerning the nationality, residence or identity of the Holder
or such beneficial owner or (y) to make and deliver any declaration or other
similar claim (other than a claim for refund of a tax, assessment or other
governmental charge withheld by the Issuer) or satisfy any information or
reporting requirements, which, in the case of (x) or (y), is required or imposed
by a statute, treaty, regulation or administrative practice of the taxing
jurisdiction as a precondition to exemption from all or part of such tax,
assessment or other governmental charge or (4) any tax, assessment or other
governmental charge that is payable otherwise than by withholding from payment
of principal of, premium, if any, or interest on such Securities; nor shall the
Issuer or any Note Guarantor, as applicable, be required to pay Additional
Amounts (a) if the payment could have been made without such deduction or
withholding if the beneficiary of the payment had presented the Securities for
payment within 30 days after the date on which such payment or such Securities
became due and payable or the date on which payment thereof is duly provided
for, whichever is later (except to the extent that the holder would have been
entitled to Additional Amounts had the Securities been presented on the last day
of such 30-day period), (b) if, at the election of the relevant Holder, the
payment of principal of (or premium, if any, on) or interest on such Securities
could have been made through another paying agent without such deduction or
withholding, or (c) with respect to any payment of principal of (or premium, if
any, on) or interest on such Securities to any Holder who is a fiduciary,
partnership or limited liability company that is treated as a partnership for
U.S. federal income tax purposes or any person other than the sole beneficial
owner of such payment, to the extent that a beneficiary or settlor with respect
to such fiduciary, a member of such partnership or limited liability company
that is treated as a partnership
60
for U.S. federal income tax purposes or the beneficial owner of such payment
would not have been entitled to the Additional Amounts had such beneficiary,
settlor, member or beneficial owner been the actual holder of such Securities.
(b) The Issuer shall provide the Trustee with official receipts evidencing
the payment of the Taxes with respect to which Additional Amounts are paid.
(c) Whenever in this Indenture or in the Securities there is mentioned, in
any context: (1) the payment of principal; (2) purchase prices in connection
with a purchase of Securities; (3) interest; or (4) any other amount payable on
or with respect to any of the Securities, such reference shall be deemed to
include payment of Additional Amounts as required under this Section 4.12 to the
extent that, in such context, Additional Amounts are, were or would be payable
in respect thereof.
(d) The Issuer shall pay any present or future stamp, court or documentary
taxes or any other excise or property taxes, charges or similar levies and other
duties (including interest and penalties) that arise in any jurisdiction from
the execution, delivery, enforcement or registration of the Securities, this
Indenture or any other document or instrument in relation thereof, or the
receipt of any payments with respect to the Securities, excluding such taxes,
charges or similar levies imposed by any jurisdiction outside of the Cayman
Islands or the United States (or any political subdivision or taxing authority
of either jurisdiction), the jurisdiction of incorporation of any successor of
the Issuer, any jurisdiction through which payment is made or in which a paying
agent is located or any jurisdiction in which the Issuer is organized or engaged
in business for tax purposes, and the Issuer will agree to indemnify the Holders
for any such taxes paid by such Holders.
(e) The obligations arising under this Section 4.12 shall survive any
termination, defeasance or discharge of this Indenture and will apply mutatis
mutandis to any jurisdiction in which any successor Person to the Issuer or any
Note Guarantor is organized or any political subdivision or taxing authority or
agency thereof or therein.
SECTION 4.13. Guarantees of Additional Securities. Notwithstanding any
other provisions of this Indenture, the Issuer shall not issue any Additional
Securities unless at the time of, and after giving effect to, the issuance of
such Additional Securities, the Note Guarantee of each Note Guarantor shall be
effective with respect to the full amount of the Securities outstanding at such
time, and all administrative and regulatory approvals shall have been obtained
with respect to such Note Guarantees.
SECTION 4.14. Rigid Disc Drive Operations. The Company will not permit any
Designated Subsidiary to own any material assets used in the rigid disc drive
operations of the Company and its Subsidiaries.
61
SECTION 4.15. Amendment of Deferred Compensation Plans. The Company will
not, and will not permit any Restricted Subsidiary to, (i) amend, modify or
waive any of its rights under any Deferred Compensation Plan, except to the
extent that such amendments, modifications or waivers, individually and in the
aggregate, (1) would not reasonably be expected to be materially adverse to the
Holders and (2) would not require the Company or any of its Subsidiaries to make
any distributions or other payments (whether in cash, securities or other
property or any combination thereof) that would be in violation of the covenants
set forth in this Indenture, or (ii) adopt any Deferred Compensation Plan if the
terms (including subordination terms) of such Deferred Compensation Plan that
are material to the Holders are in any way less favorable to the Holders than
the terms of the Deferred Compensation Plans in effect on the Closing Date.
Notwithstanding clause (i) above, the Company will not, and will not permit any
Restricted Subsidiary to, amend, modify or waive any of the subordination terms
of any Deferred Compensation Plan in effect on the Closing Date.
SECTION 4.16. Limitation on Lines of Business. The Company shall not, and
shall not permit any Restricted Subsidiary to, engage in any business, other
than a Permitted Business.
SECTION 4.17. Designated Subsidiary Investments. For the purposes of this
Indenture, (1) the aggregate amount of Designated Subsidiary Investments on the
Closing Date in each of Seagate Technology SAN Holdings and its Subsidiaries,
Seagate Removable Storage Solutions Holdings and its Subsidiaries and Seagate
Software Information Management Group Holdings, Inc. and its Subsidiaries shall
be deemed to be $189.4 million, $31.5 million and $71.5 million, respectively
and (2) following the Closing Date the aggregate amount of Designated Subsidiary
Investments in each of such entities shall be based on such amounts outstanding
on the Closing Date as set forth in clause (1) as adjusted to reflect further
Investments (other than Investments which may be deemed to have been made as a
result of services performed in the ordinary course of business) made and
reductions in such Investments resulting from repurchases, repayments or
redemptions of, or other returns of capital from, such Investments, in each case
after the Closing Date. The Company shall provide to the Trustee and the Holders
and prospective Holders (upon request) a statement of the amount of Designated
Subsidiary Investments in each Designated Subsidiary as of the end of each
fiscal quarter within 45 days of the end of such fiscal quarter.
SECTION 4.18. Limitation on the Sale or Issuance of Capital Stock of
Restricted Subsidiaries. (a) The Company shall not, and shall not permit any
Restricted Subsidiary to, sell or otherwise dispose of any shares of Capital
Stock of a Restricted Subsidiary, and shall not permit any Restricted
Subsidiary, directly or indirectly, to issue or sell or otherwise dispose of any
shares of its Capital Stock except:
(1) to the Company or a Wholly Owned Subsidiary;
62
(2) if, immediately after giving effect to such issuance, sale or
other disposition, neither the Company nor any of its Subsidiaries own any
Capital Stock of such Restricted Subsidiary; provided, however, that if
such Restricted Subsidiary is a Designated Subsidiary and if any of the
proceeds of such issue, sale or other disposition are received by a Person
other than the Company or a Restricted Subsidiary (other than a Designated
Subsidiary), such Person shall dividend or distribute cash to the Company
or a Restricted Subsidiary (other than a Designated Subsidiary) in an
amount at least equal to the amount of (x) the Designated Subsidiary
Investments with respect to such Designated Subsidiary or (y) if the
proceeds of such issue or sale received by such Person are less than the
amount of such Designated Subsidiary Investments in such Designated
Subsidiary, such proceeds; provided, further, that such dividend or
distribution shall be excluded from the calculation of amounts under
Section 4.04(a)(5)(C); or
(3) in compliance with the provisions of Section 4.06 and immediately
after giving effect to such issuance, sale or other disposition, such
Restricted Subsidiary either (A) continues to be a Restricted Subsidiary or
(B) either (i) if such Restricted Subsidiary is not a Designated Subsidiary
and would no longer be a Restricted Subsidiary, then the Investment of the
Company in such Person (after giving effect to such issuance or sale) would
have been permitted to be made in accordance with Section 4.04 as if made
on the date of such issuance or sale and such Investment will be deemed to
be an Investment for the purposes of Section 4.04 or (ii) if such
Restricted Subsidiary is a Designated Subsidiary and would no longer be a
Restricted Subsidiary, then if any of the proceeds of such issuance, sale,
or other disposition are received by a Person other than the Company or a
Restricted Subsidiary (other than a Designated Subsidiary), such Person
shall dividend or distribute cash to the Company or a Restricted Subsidiary
(other than a Designated Subsidiary) at least equal to the amount of (x)
the Designated Subsidiary Investments with respect to such Designated
Subsidiary or (y) if the proceeds of such issue or sale received by such
Person are less than the amount of such Designated Subsidiary Investments
in such Designated Subsidiary, such proceeds; provided, that (X) such
dividend or distribution shall be excluded from the calculation of amounts
under Section 4.04(a)(5)(C) and (Y) the remaining Investment of the
63
Company and the Restricted Subsidiaries in such Designated Subsidiary shall
not be subject to Section 4.04.
(b) The proceeds of any sale of such Capital Stock (other than a sale of
Capital Stock of Intermediate Holdings, HDD Holdings or a Designated Subsidiary)
permitted hereby will be treated as Net Available Cash from an Asset Disposition
and must be applied in accordance with the terms of Section 4.06.
ARTICLE 5
Successor Company
SECTION 5.01. When Issuer May Merge or Transfer Assets. (a) The Issuer
shall not consolidate with or merge with or into, or convey, transfer or lease
all or substantially all its assets to, any Person, unless:
(i) the resulting, surviving or transferee Person (the "Successor
Company") shall be a corporation, partnership or limited liability company
organized and existing under the laws of the Cayman Islands or the laws of
any political subdivision thereof or the laws of the United States of
America, any State thereof or the District of Columbia and (A) the
Successor Company (if not the Issuer) shall expressly assume, by a
supplemental indenture hereto, executed and delivered to the Trustee, in
form reasonably satisfactory to the Trustee, all the obligations of the
Issuer under the Securities and this Indenture and (B) if the Successor
Company is a partnership or limited liability company, the Successor
Company and a Subsidiary of the Successor Company which is a corporation
organized and existing under the laws of the Cayman Islands or the laws of
any political subdivision thereof or the laws of the United States of
America, any State thereof or the District of Columbia shall execute and
deliver to the Trustee, in form reasonably satisfactory to the Trustee, a
supplemental indenture hereto pursuant to which each shall jointly and
severally assume all of the obligations of the Issuer under the Securities
and this Indenture;
(ii) immediately after giving effect to such transaction (and treating
any Indebtedness which becomes an obligation of the Successor Company, the
Company or any Restricted Subsidiary as a result of such transaction as
having been Incurred by the Successor Company, the Company or such
Restricted Subsidiary at the time of such transaction), no Default shall
have occurred and be continuing;
(iii) immediately after giving effect to such transaction, either (A)
the Company would be able to Incur an additional $1.00 of Indebtedness
pursuant to
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Section 4.03(a) or (B) the Consolidated Coverage Ratio for the Successor
Company would be (i) greater than the Consolidated Coverage Ratio for the
Company immediately prior to the such merger, conveyance or transfer and
(ii) at least 4.5:1; and
(iv) the Issuer shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture (if any)
comply with this Indenture.
The Successor Company shall succeed to, and be substituted for, and may
exercise every right and power of, the Issuer under this Indenture, but the
predecessor Issuer in the case of a conveyance, transfer or lease of all or
substantially all its assets shall not be released from the obligation to pay
the principal of and interest on the Securities.
(b) Each Note Guarantor shall not, and the Company shall not permit any
Note Guarantor to, consolidate with or merge with or into, or convey, transfer
or lease all or substantially all of its assets to any Person unless: (i) except
in the case of a Note Guarantor that has been disposed of in its entirety to
another Person, the resulting, surviving or transferee Person (the "Successor
Guarantor") will be a corporation, partnership or limited liability company
organized and existing under the laws of the jurisdiction under which such Note
Guarantor was organized and existing or the laws of the United States of
America, any State thereof or the District of Columbia, and such Person (if not
such Note Guarantor) shall expressly assume, by a supplemental indenture hereto,
executed and delivered to the Trustee, in form reasonably satisfactory to the
Trustee, all the obligations of such Note Guarantor under its Note Guarantee;
(ii) immediately after giving effect to such transaction (and treating any
Indebtedness which becomes an obligation of the Successor Guarantor or any
Restricted Subsidiary as a result of such transaction as having been Incurred by
the Successor Guarantor or any Restricted Subsidiary at the time of such
transaction), no Default shall have occurred and be continuing; and (iii) the
Company shall have delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that such consolidation, merger or transfer and
such supplemental indenture (if any) comply with this Indenture.
(c) Notwithstanding the foregoing and subject to the following proviso: (i)
any Restricted Subsidiary may consolidate with, merge into or transfer all or
part of its properties and assets to the Issuer or any Note Guarantor and (ii)
the Company, Intermediate Holdings, HDD Holdings or the Issuer may merge with an
Affiliate incorporated or organized solely for the purpose of reincorporating
the Company, Intermediate Holdings, HDD Holdings or the Issuer, as the case may
be, in another jurisdiction to realize tax or other benefits; provided, however,
that in the case of any merger or consolidation in which the Issuer is a party
if the resulting or surviving Person is a partnership or limited liability
company, such Person and a Subsidiary of such Person
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which is a corporation organized and existing under the laws of the Cayman
Islands or the laws of any political subdivision thereof or the laws of the
United States of America, any State thereof or the District of Columbia shall
execute and deliver to the Trustee, in form reasonably satisfactory to the
Trustee, a supplemental indenture pursuant to which each shall jointly and
severally assume all of the obligations of the Issuer under the Securities and
this Indenture.
ARTICLE 6
Defaults and Remedies
SECTION 6.01. Events of Default. An "Event of Default" occurs if:
(a) the Issuer defaults in any payment of interest on any Security
when the same becomes due and payable or in any payment of liquidated
damages, whether or not such payment shall be prohibited by Article 10, and
such default continues for a period of 30 days;
(b) the Issuer (i) defaults in the payment of the principal of any
Security when the same becomes due and payable at its Stated Maturity, upon
required redemption or repurchase, upon declaration or otherwise, whether
or not such payment shall be prohibited by Article 10 or (ii) fails to
redeem or purchase Securities when required pursuant to this Indenture or
the Securities, whether or not such redemption or purchase shall be
prohibited by Article 10;
(c) the Company or any Subsidiary fails to comply with Section 5.01;
(d) the Company or any Subsidiary fails to comply with Section 4.02,
4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.11, 4.13, 4.14, 4.15, 4.16, or 4.17
(other than a failure to purchase Securities when required under Section
4.06 or 4.08) and such failure continues for 45 days after the notice
specified below;
(e) the Company or any Subsidiary fails to comply with any of its
agreements in the Securities or this Indenture (other than those referred
to in (a), (b), (c) or (d) above) and such failure continues for 60 days
after the notice specified below;
(f) Indebtedness of the Company, the Issuer or any Significant
Subsidiary is not paid within any applicable grace period after final
maturity or the acceleration by the holders thereof because of a default
and the total amount of such Indebtedness unpaid or accelerated exceeds $50
million or its foreign
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currency equivalent at the time and such failure continues for 30 days
after receipt of the notice specified below;
(g) the Company, Intermediate Holdings, HDD Holdings, the Issuer or
any Significant Subsidiary pursuant to or within the meaning of any
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 any
substantial part of its property; or
(iv) makes a general assignment for the benefit of its creditors;
or takes any comparable action under any foreign laws relating to
insolvency;
(h) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(i) is for relief against the Company, Intermediate Holdings, HDD
Holdings, the Issuer or any Significant Subsidiary in an involuntary
case;
(ii) appoints a Custodian of the Company, Intermediate Holdings,
HDD Holdings, the Issuer or any Significant Subsidiary or for any
substantial part of its property; or
(iii) orders the winding up or liquidation of the Company,
Intermediate Holdings, HDD Holdings, the Issuer or any Significant
Subsidiary;
or any similar relief is granted under any foreign laws and the order or
decree remains unstayed and in effect for 60 days;
(i) any judgment or decree for the payment of money (other than
judgments which are covered by enforceable insurance policies issued by
reputable and creditworthy companies) in excess of $50 million or its
foreign currency equivalent against the Company, the Issuer or any
Significant Subsidiary and either (i) an enforcement proceeding has been
commenced by any creditor upon such judgment or decree or (ii) there is a
period of 60 days following the entry of such judgment or decree during
which such judgment or decree is not discharged, waived or the execution
thereof stayed;
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(j) any Note Guarantee ceases to be in full force and effect (except
as contemplated by the terms thereof) or any Note Guarantor or Person
acting by or on behalf of such Note Guarantor denies or disaffirms its
obligations under this Indenture or any Note Guarantee and such Default
continues for 10 days after receipt of the notice specified below;
(k) the Company or any Subsidiary in any proceeding before, or any
filing with, any court, tribunal or governmental authority:
(i) challenges the subordination provisions of any Deferred
Compensation Plan;
(ii) asserts that the subordination provisions of any Deferred
Compensation Plan are invalid or unenforceable; or
(iii) asserts that the obligations of the Issuer and the Note
Guarantors in respect of the Securities and the Note Guarantees are
not senior obligations under the subordination provisions of any
Deferred Compensation Plan; or
(l) any court, tribunal or government authority of competent
jurisdiction:
(i) judges the subordination provisions of any Deferred
Compensation Plan to be invalid or unenforceable; or
(ii) judges that the obligations of the Issuer and the Note
Guarantors under the Securities and the Note Guarantees are not senior
obligations under the subordination provisions of any Deferred
Compensation Plan.
The foregoing shall constitute Events of Default whatever the reason for
any such Event of Default and whether it is voluntary or involuntary or is
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body.
The term "Bankruptcy Law" means Title 11, United States Code, or any
similar Federal or state law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator, custodian or similar official
under any Bankruptcy Law.
A Default under clause (d), (e), (f) or (j) above is not an Event of
Default until the Trustee notifies the Issuer or the Holders of at least 25% in
principal amount of the outstanding Securities notify the Issuer and the Trustee
of the Default and the
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Company or the Subsidiary, as applicable, does not cure such Default within the
time specified in clauses (d), (e), (f) or (j) above after receipt of such
notice. Such notice must specify the Default, demand that it be remedied and
state that such notice is a "Notice of Default".
The Issuer shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any event which is, or with the giving of notice or the lapse of time or both
would become, an Event of Default, its status and what action the Issuer is
taking or proposes to take with respect thereto.
SECTION 6.02. Acceleration. If an Event of Default (other than an Event of
Default specified in Section 6.01(g) or (h) with respect to the Company,
Intermediate Holdings, HDD Holdings or the Issuer) occurs and is continuing, the
Trustee by notice to the Issuer, or the Holders of at least 25% in principal
amount of the outstanding Securities by notice to the Issuer, may declare the
principal of and accrued but unpaid interest on all the Securities to be due and
payable. Upon such a declaration, such principal and interest shall be due and
payable immediately. If an Event of Default specified in Section 6.01(g) or (h)
with respect to the Company, Intermediate Holdings, HDD Holdings or the Issuer
occurs, the principal of and interest on all the Securities shall ipso facto
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or any Holders. The Holders of a majority in
principal amount of the Securities by notice to the Trustee may rescind an
acceleration and its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default have been cured or
waived except nonpayment of principal or interest that has become due solely
because of acceleration. No such rescission shall affect any subsequent Default
or impair any right consequent thereto.
SECTION 6.03. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal of or interest on the Securities or to enforce the performance of
any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. No remedy is exclusive of any
other remedy. All available remedies are cumulative.
SECTION 6.04. Waiver of Past Defaults. The Holders of a majority in
principal amount of the Securities by notice to the Trustee may waive an
existing Default or compliance with any provision of this Indenture and its
consequences except (a) a Default in the payment of the principal of or interest
on a Security, (b) a Default arising
69
from the failure to redeem or purchase any Security when required pursuant to
the terms of this Indenture or (c) a Default in respect of a provision that
under Section 9.02 cannot be amended without the consent of each Holder
affected. When a Default is waived, it is deemed cured, but no such waiver shall
extend to any subsequent or other Default or impair any consequent right.
SECTION 6.05. Control by Majority. The Holders of a majority in principal
amount of the Securities may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or of exercising any trust or
power conferred on the Trustee. However, the Trustee may refuse to follow any
direction that conflicts with applicable law or this Indenture or, subject to
Section 7.01, that the Trustee determines is unduly prejudicial to the rights of
any other Holder or that would involve the Trustee in personal liability;
provided, however, that the Trustee may take any other action deemed proper by
the Trustee that is not inconsistent with such direction. Prior to taking any
action under this Indenture, the Trustee shall be entitled to indemnification
satisfactory to it in its sole discretion against all losses and expenses caused
by taking or not taking such action.
SECTION 6.06. Limitation on Suits. (a) Except to enforce the right to
receive payment of principal, premium (if any) or interest when due, no Holder
may pursue any remedy with respect to this Indenture or the Securities unless:
(i) the Holder gives to the Trustee written notice stating that an
Event of Default is continuing;
(ii) the Holders of at least 25% in principal amount of the Securities
make a written request to the Trustee to pursue the remedy;
(iii) such Holder or Holders offer to the Trustee security or
indemnity reasonably satisfactory to it against any loss, liability or
expense;
(iv) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of security or indemnity; and
(v) the Holders of a majority in principal amount of the Securities do
not give the Trustee a direction inconsistent with the request during such
60-day period.
(b) A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over another Holder.
SECTION 6.07. Rights of Holders to Receive Payment. Notwithstanding any
other provision of this Indenture, the right of any Holder to receive payment of
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principal of and liquidated damages and interest on the Securities held by such
Holder, on or after the respective due dates expressed or provided for in the
Securities, or to bring suit for the enforcement of any such payment on or after
such respective dates, shall not be impaired or affected without the consent of
such Holder.
SECTION 6.08. Collection Suit by Trustee. If an Event of Default specified
in Section 6.01(a) or (b) occurs and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express trust against the Issuer
or any other obligor on the Securities for the whole amount then due and owing
(together with interest on overdue principal and (to the extent lawful) on any
unpaid interest at the rate provided for in the Securities) and the amounts
provided for in Section 7.07.
SECTION 6.09. Trustee May File Proofs of Claim. The Trustee may file such
proofs of claim and other papers or documents as may be necessary or advisable
in order to have the claims of the Trustee and the Holders allowed in any
judicial proceedings relative to the Company, the Issuer, any Note Guarantor or
other Subsidiary, their creditors or their property and, unless prohibited by
law or applicable regulations, may vote on behalf of the Holders in any election
of a trustee in bankruptcy or other Person performing similar functions, and any
Custodian in any such judicial proceeding is hereby authorized by each Holder to
make payments to the Trustee and, in the event that the Trustee shall consent to
the making of such payments directly to the Holders, to pay to the Trustee any
amount due it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and its counsel, and any other amounts due
the Trustee under Section 7.07.
SECTION 6.10. Priorities. If the Trustee collects any money or property
pursuant to this Article 6, it shall pay out the money or property in the
following order:
FIRST: to the Trustee for amounts due under Section 7.07;
SECOND: to holders of Senior Indebtedness of the Issuer to the extent
required by Article 10 and to holders of Senior Indebtedness of the Note
Guarantors to the extent required by Article 12;
THIRD: to Holders for amounts due and unpaid on the Securities for
principal and interest, ratably, and any liquidated damages without
preference or priority of any kind, according to the amounts due and
payable on the Securities for principal, interest and any liquidated
damages, respectively; and
FOURTH: to the Issuer or any other obligor on the Securities.
The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section. At least 15 days before such record date, the
Trustee
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shall mail to each Holder and the Issuer a notice that states the record date,
the payment date and amount to be paid.
SECTION 6.11. Undertaking for Costs. In any suit for the enforcement of any
right or remedy under this Indenture or in any suit against the Trustee for any
action taken or omitted by it as Trustee, a court in its discretion may require
the filing by any party litigant in the suit of an undertaking to pay the costs
of the suit, and the court in its discretion may assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in the suit,
having due regard to the merits and good faith of the claims or defenses made by
the party litigant. This Section does not apply to a suit by the Trustee, a suit
by a Holder pursuant to Section 6.07 or a suit by Holders of more than 10% in
principal amount of the Securities.
SECTION 6.12. Waiver of Stay or Extension Laws. Neither the Issuer nor any
Note Guarantor (to the extent it may lawfully do so) shall at any time insist
upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this
Indenture; and the Issuer and each Note Guarantor (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and shall not hinder, delay or impede the execution of any power herein
granted to the Trustee, but shall suffer and permit the execution of every such
power as though no such law had been enacted.
ARTICLE 7
Trustee
SECTION 7.01. Duties of Trustee. (a) If an Event of Default has occurred
and is continuing, the Trustee shall exercise the rights and powers vested in it
by this Indenture and use the same degree of care and skill in their exercise as
a prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Trustee undertakes to perform such duties and only such duties
as are specifically set forth in this Indenture and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(ii) in the absence of bad faith or gross negligence 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
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and conforming to the requirements of this Indenture. In case of any such
certificates or opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall examine the same
to determine whether or not they conform to the requirements of this
Indenture (but need not confirm or investigate the accuracy of mathematical
calculations or other facts stated therein).
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own wilful 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 Trust Officer unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts;
(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; and
(iv) no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that
repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Issuer.
(f) Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by law.
(g) Every provision of this Indenture relating to the conduct or affecting
the liability of or affording protection to the Trustee shall be subject to the
provisions of this Section and to the provisions of the TIA.
SECTION 7.02. Rights of Trustee. (a) The Trustee may conclusively rely on
any document believed by it to be genuine and to have been signed or presented
by the proper person. The Trustee need not investigate any fact or matter stated
in the document.
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(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel. The Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on the
Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible for the
misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its rights or
powers; provided, however, that the Trustee's conduct does not constitute wilful
misconduct or negligence.
(e) The Trustee may consult with counsel of its selection, and the advice
or opinion of counsel with respect to legal matters relating to this Indenture
and the Securities shall be full and complete authorization and protection from
liability in respect of any action taken, omitted or suffered by it hereunder in
good faith and in accordance with the advice or opinion of such counsel.
(f) The Trustee shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond, debenture,
note or other paper or document unless requested in writing to do so by the
Holders of not less than a majority in principal amount of the Securities at the
time outstanding, but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit, and, if
the Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the Issuer and
the Note Guarantors, personally or by agent or attorney.
(g) The Trustee shall not be deemed to have notice of any Default or Event
of Default unless a Trust Officer of the Trustee has actual knowledge thereof or
unless written notice of any event which is in fact such a default is received
by the Trustee at the Corporate Trust Office of the Trustee, and such notice
references the Securities and this Indenture.
(h) The rights, privileges, protections, immunities and benefits given to
the Trustee, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and to each duly authorized agent, custodian and other Person
employed to act hereunder and acting within the limits of such person's actual
authority.
(i) The Trustee may request that the Issuer deliver an Officers'
Certificate setting forth the names of individuals and/or titles of officers
authorized at such time to take specified actions pursuant to this Indenture,
which Officers' Certificate may be
74
signed by any person authorized to sign an Officers' Certificate, including any
person specified as so authorized in any such certificate previously delivered
and not superseded.
SECTION 7.03. Individual Rights of Trustee. The Trustee in its individual
or any other capacity may become the owner or pledgee of Securities and may
otherwise deal with the Issuer or its Affiliates with the same rights it would
have if it were not Trustee. Any Paying Agent or Registrar may do the same with
like rights. However, the Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer. The Trustee shall not be responsible
for and makes no representation as to the validity or adequacy of this
Indenture, any Note Guarantee or the Securities, it shall not be accountable for
the Issuer's use of the proceeds from the Securities, and it shall not be
responsible for any statement of the Issuer or any Note Guarantor in this
Indenture or in any document issued in connection with the sale of the
Securities or in the Securities other than the Trustee's certificate of
authentication. The Trustee shall not be charged with knowledge of any Default
or Event of Default under Sections 6.01(c), (d), (e), (f), (i), (j), (k) or (l)
or of the identity of any Significant Subsidiary unless either (a) a Trust
Officer shall have actual knowledge thereof or (b) the Trustee shall have
received notice thereof in accordance with Section 13.02 hereof from the Issuer,
any Note Guarantor or any Holder.
SECTION 7.05. Notice of Defaults. If a Default occurs and is continuing and
if it is known to the Trustee, the Trustee shall mail to each Holder notice of
the Default within the earlier of 90 days after it occurs or 30 days after it is
actually known to a Trust Officer. Except in the case of a Default in payment of
principal of or interest on any Security (including payments pursuant to the
mandatory redemption provisions of such Security, if any), the Trustee may
withhold the notice if and so long as a committee of its Trust Officers in good
faith determines that withholding the notice is in the interests of the Holders.
SECTION 7.06. Reports by Trustee to Holders. As promptly as practicable
after each November 15 beginning with the November 15 following the date of this
Indenture, and in any event prior to January 15 in each year, the Trustee shall
mail to each Holder a brief report dated as of such November 15 that complies
with Section 313(a) of the TIA if and to the extent required thereby. The
Trustee shall also comply with Section 313(b) of the TIA.
A copy of each report at the time of its mailing to Holders shall be filed
with the SEC and each stock exchange (if any) on which the Securities are
listed. The Issuer agrees to notify promptly the Trustee whenever the Securities
become listed on any stock exchange and of any delisting thereof.
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SECTION 7.07. Compensation and Indemnity. The Issuer shall pay to the
Trustee from time to time reasonable compensation for its services as shall be
agreed to in writing from time to time by the Issuer and the Trustee. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Issuer shall reimburse the Trustee upon request
for all reasonable out-of-pocket expenses incurred or made by it, including
costs of collection, in addition to the compensation for its services. Such
expenses shall include the reasonable compensation and expenses, disbursements
and advances of the Trustee's agents, counsel, accountants and experts. The
Issuer and each Note Guarantor, jointly and severally shall indemnify each of
the Trustee and any predecessor Trustee against any and all loss, liability or
expense (including reasonable attorneys' fees and expenses) incurred by or in
connection with the acceptance and administration of this trust and the
performance of its duties hereunder. The Trustee shall notify the Issuer of any
claim for which it may seek indemnity promptly upon obtaining actual knowledge
thereof; provided, however, that any failure so to notify the Issuer shall not
relieve the Issuer or any Note Guarantor of its indemnity obligations hereunder.
The Issuer shall defend the claim and the indemnified party shall provide
reasonable cooperation at the Issuer's expense in the defense. Such indemnified
parties may have separate counsel and the Issuer and the Note Guarantors, as
applicable shall pay the fees and expenses of such counsel; provided, however,
that the Issuer shall not be required to pay such fees and expenses if it
assumes such indemnified parties' defense and, in such indemnified parties'
reasonable judgment, there is no conflict of interest between the Issuer and the
Note Guarantors, as applicable, and such parties in connection with such
defense. The Issuer need not reimburse any expense or indemnify against any
loss, liability or expense incurred by an indemnified party through such party's
own wilful misconduct, negligence or bad faith.
To secure the Issuer's payment obligations in this Section, the Trustee
shall have a lien prior to the Securities on all money or property held or
collected by the Trustee other than money or property held in trust to pay
principal of and interest and liquidated damages, if any, on particular
Securities.
The Issuer's payment obligations pursuant to this Section shall survive the
satisfaction or discharge of this Indenture, any rejection or termination of
this Indenture under any bankruptcy law or the resignation or removal of the
Trustee. Without prejudice to any other rights available to the Trustee under
applicable law, when the Trustee incurs expenses after the occurrence of a
Default specified in Section 6.01(g) or (h) with respect to the Issuer, the
expenses are intended to constitute expenses of administration under the
Bankruptcy Law.
SECTION 7.08. Replacement of Trustee. (a) The Trustee may resign at any
time by so notifying the Issuer. The Holders of a majority in principal amount
of the
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Securities may remove the Trustee by so notifying the Trustee and may appoint a
successor Trustee. The Issuer shall remove the Trustee if:
(i) the Trustee fails to comply with Section 7.10;
(ii) the Trustee is adjudged bankrupt or insolvent;
(iii) a receiver or other public officer takes charge of the Trustee
or its property; or
(iv) the Trustee otherwise becomes incapable of acting.
(b) If the Trustee resigns, is removed by the Issuer or by the Holders of a
majority in principal amount of the Securities and such Holders do not
reasonably promptly appoint a successor Trustee, or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Issuer shall promptly appoint a successor
Trustee.
(c) A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer. Thereupon the resignation
or removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Holders. The retiring Trustee shall promptly transfer all property held by it as
Trustee to the successor Trustee, subject to the lien provided for in Section
7.07.
(d) If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee or the Holders of
10% in principal amount of the Securities may petition any court of competent
jurisdiction for the appointment of a successor Trustee at the expense of the
Issuer.
(e) If the Trustee fails to comply with Section 7.10, unless the Trustee's
duty to resign is stayed as provided in Section 310(b) of the TIA, any Holder
who has been a bona fide holder of a Security for at least six months may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
(f) Notwithstanding the replacement of the Trustee pursuant to this
Section, the Issuer's obligations under Section 7.07 shall continue for the
benefit of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger. If the Trustee consolidates
with, merges or converts into, or transfers all or substantially all its
corporate trust
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business or assets to, another corporation or banking association, the
resulting, surviving or transferee corporation without any further act shall be
the successor Trustee.
In case at the time such successor or successors by merger, conversion or
consolidation to the Trustee shall succeed to the trusts created by this
Indenture any of the Securities shall have been authenticated but not delivered,
any such successor to the Trustee may adopt the certificate of authentication of
any predecessor trustee, and deliver such Securities so authenticated; and in
case at that time any of the Securities shall not have been authenticated, any
successor to the Trustee may authenticate such Securities either in the name of
any predecessor hereunder or in the name of the successor to the Trustee; and in
all such cases such certificates shall have the full force which it is anywhere
in the Securities or in this Indenture provided that the certificate of the
Trustee shall have.
SECTION 7.10. Eligibility; Disqualification. The Trustee shall at all times
satisfy the requirements of Section 310(a) of the TIA. The Trustee shall have a
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition. The Trustee shall comply with
Section 310(b) of the TIA, subject to its right to apply for a stay of its duty
to resign under the penultimate paragraph of Section 310(b) of the TIA;
provided, however, that there shall be excluded from the operation of Section
310(b)(1) of the TIA any indenture or indentures under which other securities or
certificates of interest or participation in other securities of the Issuer are
outstanding if the requirements for such exclusion set forth in Section
310(b)(1) of the TIA are met.
SECTION 7.11. Preferential Collection of Claims Against Issuer. The Trustee
shall comply with Section 311(a) of the TIA, excluding any creditor relationship
listed in Section 311(b) of the TIA. A Trustee who has resigned or been removed
shall be subject to Section 311(a) of the TIA to the extent indicated.
ARTICLE 8
Discharge of Indenture; Defeasance
SECTION 8.01. Discharge of Liability on Securities; Defeasance. (a) When
(i) all outstanding Securities (other than Securities replaced or paid pursuant
to Section 2.08) have been canceled or delivered to the Trustee for cancelation
or (ii) all outstanding Securities have become due and payable, whether at
maturity or as a result of the mailing of a notice of redemption pursuant to
Article 3 hereof, and the Issuer irrevocably deposits with the Trustee funds in
an amount sufficient or U.S. Government Obligations, the principal of and
interest on which will be sufficient, or a combination thereof sufficient, in
the written opinion of a nationally recognized firm of independent
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public accountants delivered to the Trustee (which delivery shall only be
required if U.S. Government Obligations have been so deposited), to pay the
principal of, premium, if any, and interest and liquidated damages, if any, on
the outstanding Securities when due at maturity or upon redemption of, including
interest thereon to maturity or such redemption date (other than Securities
replaced or paid pursuant to Section 2.08) and liquidated damages, if any, and
if in either case the Issuer pays all other sums payable hereunder by the
Issuer, then this Indenture shall, subject to Section 8.01(c), cease to be of
further effect and the obligations of the Issuer and the Note Guarantors
hereunder shall cease. The Trustee shall acknowledge satisfaction and discharge
of this Indenture on demand of the Issuer accompanied by an Officers'
Certificate and an Opinion of Counsel and at the cost and expense of the Issuer.
(b) Subject to Sections 8.01(c) and 8.02, the Company and the Issuer at any
time may terminate (i) all of their obligations under the Securities and this
Indenture ("legal defeasance option") or (ii) their obligations under Sections
4.02, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.11, 4.14, 4.15, 4.16, 4.17 and 4.18
and the operation of Section 5.01(a)(iii), 6.01(d), 6.01(f), 6.01(g) (other than
with respect to the Company, Intermediate Holdings, HDD Holdings or the Issuer),
6.01(h) (other than with respect to the Company, Intermediate Holdings, HDD
Holdings or the Issuer) and 6.01(i) ("covenant defeasance option"). The Company
and the Issuer may exercise their legal defeasance option notwithstanding their
prior exercise of their covenant defeasance option. In the event that the
Company and the Issuer terminate all of their obligations under the Securities
and this Indenture by exercising their legal defeasance option, the obligations
under the Note Guarantees shall each be terminated simultaneously with the
termination of such obligations.
If the Company and the Issuer exercise their legal defeasance option,
payment of the Securities may not be accelerated because of an Event of Default.
If the Company and the Issuer exercise their covenant defeasance option, payment
of the Securities may not be accelerated because of an Event of Default
specified in Section 6.01(d), 6.01(f), 6.01(g) (other than with respect to the
Company, Intermediate Holdings, HDD Holdings or the Issuer), 6.01(h) (other than
with respect to the Company, Intermediate Holdings, HDD Holdings or the Issuer)
or 6.01(i) or because of the failure of the Company and the Issuer to comply
with Section 5.01(a)(iii).
Upon satisfaction of the conditions set forth herein and upon request of
the Issuer, the Trustee shall acknowledge in writing the discharge of those
obligations that the Issuer and the Note Guarantors terminate.
(c) Notwithstanding clauses (a) and (b) above, the Issuer's obligations in
Sections 2.04, 2.05, 2.06, 2.07, 2.08, 2.09, 7.07, 7.08 and in this Article 8
shall survive until the Securities have been paid in full. Thereafter, the
Issuer's obligations in Sections 7.07, 8.05 and 8.06 shall survive.
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SECTION 8.02. Conditions to Defeasance. (a) The Issuer may exercise its
legal defeasance option or its covenant defeasance option only if:
(i) the Company or the Issuer irrevocably deposit in trust with the
Trustee money in an amount sufficient or U.S. Government Obligations, the
principal of and interest on which will be sufficient, or a combination
thereof sufficient, to pay the principal of, and premium (if any), interest
and liquidated damages (if any), on the Securities when due at maturity or
redemption, as the case may be, including interest thereon to maturity or
such redemption date;
(ii) the Company and the Issuer deliver to the Trustee a certificate
from a nationally recognized firm of independent accountants expressing
their opinion that the payments of principal and interest when due and
without reinvestment on the deposited U.S. Government Obligations plus any
deposited money without investment will provide cash at such times and in
such amounts as will be sufficient to pay principal of, premium, if any,
interest and liquidated damages, if any on, all the Securities when due at
maturity or redemption, as the case may be, including interest thereon to
maturity or such redemption date;
(iii) 123 days pass after the deposit is made and during the 123-day
period no Default specified in Section 6.01(g) or (h) with respect to the
Company, Intermediate Holdings, HDD Holdings or the Issuer occurs which is
continuing at the end of the period;
(iv) the deposit does not constitute a default under any other
agreement binding on the Company or the Issuer and is not prohibited by
Article 10;
(v) the Company and the Issuer deliver to the Trustee an Opinion of
Counsel to the effect that the trust resulting from the deposit does not
constitute, or is qualified as, a regulated investment company under the
Investment Company Act of 1940;
(vi) in the case of the legal defeasance option, the Company and the
Issuer shall have delivered to the Trustee an Opinion of Counsel, subject
to customary assumptions and exclusions, stating that (1) the Issuer has
received from, or there has been published by, the Internal Revenue Service
a ruling, or (2) since the date of this Indenture there has been a change
in the applicable Federal income tax law, in either case to the effect
that, and based thereon such Opinion of Counsel shall confirm that, the
Holders will not recognize income, gain or loss for U.S. Federal income or
Cayman Islands tax purposes as a result of such deposit and defeasance and
will be subject to U.S. Federal income tax (including withholding taxes) on
the same amounts, in the same manner and at the same times as would have
been the case if such deposit and defeasance had not occurred;
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(vii) in the case of the covenant defeasance option, the Company and
the Issuer shall have delivered to the Trustee an Opinion of Counsel,
subject to customary assumptions and exclusions, to the effect that the
Holders will not recognize income, gain or loss for U.S. Federal income or
Cayman Islands tax purposes as a result of such deposit and defeasance and
will be subject to U.S. Federal income or Cayman Islands tax (including
withholding taxes) on the same amounts, in the same manner and at the same
times as would have been the case if such deposit and defeasance had not
occurred; and
(viii) the Company and the Issuer deliver to the Trustee an Officers'
Certificate and an Opinion of Counsel, subject to customary assumptions and
exclusions, each stating that all conditions precedent to the defeasance
and discharge of the Securities as contemplated by this Article 8 have been
complied with.
(b) Before or after a deposit, the Issuer may make arrangements
satisfactory to the Trustee for the redemption of Securities at a future date in
accordance with Article 3.
SECTION 8.03. Application of Trust Money. The Trustee shall hold in trust
money or U.S. Government Obligations deposited with it pursuant to this Article
8. It shall apply the deposited money and the money from U.S. Government
Obligations through the Paying Agent and in accordance with this Indenture to
the payment of principal of and interest and liquidated damages, if any, on the
Securities. Money and securities so held in trust are not subject to Article 10
or 12.
SECTION 8.04. Repayment to Issuer. The Trustee and the Paying Agent shall
promptly turn over to the Issuer upon request any money or U.S. Government
Obligations held by it as provided in this Article which, in the written opinion
of nationally recognized firm of independent public accountants delivered to the
Trustee (which delivery shall only be required if U.S. Government Obligations
have been so deposited), are in excess of the amount thereof which would then be
required to be deposited to effect an equivalent discharge or defeasance in
accordance with this Article.
Subject to any applicable abandoned property law, the Trustee and the
Paying Agent shall pay to the Issuer upon written request any money held by them
for the payment of principal, premium, interest or liquidated damages that
remains unclaimed for two years, and, thereafter, Holders entitled to the money
must look to the Issuer for payment as general creditors, and the Trustee and
the Paying Agent shall have no further liability with respect to such monies.
SECTION 8.05. Indemnity for Government Obligations. The Issuer shall pay
and shall indemnify the Trustee against any tax, fee or other charge imposed on
or
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assessed against deposited U.S. Government Obligations or the principal and
interest received on such U.S. Government Obligations.
SECTION 8.06. Reinstatement. If the Trustee or Paying Agent is unable to
apply any money or U.S. Government Obligations in accordance with this Article 8
by reason of any legal proceeding or by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, the Company's, the Restricted Subsidiaries', the Issuer's and
the Note Guarantor's obligations under this Indenture and the Securities shall
be revived and reinstated as though no deposit had occurred pursuant to this
Article 8 until such time as the Trustee or Paying Agent is permitted to apply
all such money or U.S. Government Obligations in accordance with this Article 8;
provided, however, that, if the Issuer has made any payment of principal of or
interest or liquidated damages on, any Securities because of the reinstatement
of its obligations, the Issuer shall be subrogated to the rights of the Holders
of such Securities to receive such payment from the money or U.S. Government
Obligations held by the Trustee or Paying Agent.
ARTICLE 9
Amendments
SECTION 9.01. Without Consent of Holders. (a) The Issuer, the Note
Guarantors and the Trustee may amend this Indenture or the Securities without
notice to or consent of any Holder:
(i) to cure any ambiguity, omission, defect or inconsistency;
(ii) to comply with Article 5;
(iii) to provide for uncertificated Securities in addition to or in
place of certificated Securities; provided, however, that the
uncertificated Securities are issued in registered form for purposes of
Section 163(f) of the Code or in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B) of the Code;
(iv) to make any change in Article 10 or Article 12 that would limit
or terminate the benefits available to any holder of Senior Indebtedness of
the Issuer or a Note Guarantor (or Representatives thereof) under Article
10 or Article 12, respectively;
(v) to add additional Guarantees with respect to the Securities or to
secure the Securities;
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(vi) to add to the covenants of the Company and the Restricted
Subsidiaries for the benefit of the Holders or to surrender any right or
power herein conferred upon the Company or the Issuer;
(vii) to comply with any requirement of the SEC in connection with
qualifying, or maintaining the qualification of, this Indenture under the
TIA;
(viii) to make any change that does not adversely affect the rights of
any Holder under the provisions of this Indenture; or
(ix) to provide for the issuance, subject to Section 4.03, of the
Exchange Securities, Private Exchange Securities or Additional Securities,
which shall have terms substantially identical in all material respects to
the Original Securities (except that the transfer restrictions contained in
the Original Securities shall be modified or eliminated, as appropriate),
and which shall be treated, together with any outstanding Original
Securities, as a single issue of securities.
(b) An amendment under this Section 9.01 may not make any change that
adversely affects the rights under Article 10 or Article 12 of any holder of
Senior Indebtedness of the Issuer or a Note Guarantor then outstanding unless
the holders of such Senior Indebtedness (or any group or Representative thereof
authorized to give a consent) consent to such change.
After an amendment under this Section 9.01 becomes effective, the Issuer
shall mail to Holders a notice briefly describing such amendment. The failure to
give such notice to all Holders, or any defect therein, shall not impair or
affect the validity of an amendment under this Section 9.01.
SECTION 9.02. With Consent of Holders. (a) The Issuer, the Note Guarantors
and the Trustee may amend this Indenture or the Securities without notice to any
Holder but with the written consent of the Holders of at least a majority in
principal amount of the Securities then outstanding (including consents obtained
in connection with a tender offer or exchange for the Securities). However,
without the consent of each Holder affected, an amendment may not:
(i) reduce the amount of Securities whose Holders must consent to an
amendment;
(ii) reduce the rate of or extend the time for payment of interest or
any liquidated damages on any Security;
(iii) reduce the principal of or extend the Stated Maturity of any
Security;
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(iv) reduce the premium payable upon the redemption of any Security or
change the time at which any Security may be redeemed in accordance with
Article 3;
(v) make any Security payable in money other than that stated in the
Security;
(vi) make any change in Article 10 or Article 12 that adversely
affects the rights of any Holder under Article 10 or Article 12;
(vii) make any change in Section 6.04 or 6.07 or the second sentence
of this Section 9.02 or institute suit for the enforcement of any payment
of, or with respect to, such Holder's Securities;
(viii) modify the Note Guarantees in any manner adverse to the
Holders;
(ix) make any change in the provisions of paragraph 6 of the
Securities that adversely affects the rights of any Holder or amend the
terms of the Securities or this Indenture in a way that would result in the
loss of an exemption from any of the Taxes described thereunder.
It shall not be necessary for the consent of the Holders under this Section
9.02 to approve the particular form of any proposed amendment, but it shall be
sufficient if such consent approves the substance thereof.
An amendment under this Section 9.02 may not make any change that adversely
affects the rights under Article 10 or Article 12 of any holder of Senior
Indebtedness then outstanding unless the holders of such Senior Indebtedness (or
any group or Representative thereof authorized to give a consent) consent to
such change.
After an amendment under this Section 9.02 becomes effective, the Issuer
shall mail to Holders a notice briefly describing such amendment. The failure to
give such notice to all Holders, or any defect therein, shall not impair or
affect the validity of an amendment under this Section 9.02.
SECTION 9.03. Compliance with Trust Indenture Act. Every amendment to this
Indenture or the Securities shall comply with the TIA as then in effect.
SECTION 9.04. Revocation and Effect of Consents and Waivers. (a) A consent
to an amendment or a waiver by a Holder of a Security shall bind the Holder and
every subsequent Holder of that Security or portion of the Security that
evidences the same debt as the consenting Holder's Security, even if notation of
the consent or waiver is not made on the Security. However, any such Holder or
subsequent Holder may revoke
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the consent or waiver as to such Holder's Security or portion of the Security if
the Trustee receives the notice of revocation before the date on which the
Trustee receives an Officers' Certificate from the Issuer certifying that the
requisite number of consents have been received. After an amendment or waiver
becomes effective, it shall bind every Holder. An amendment or waiver becomes
effective upon the (i) receipt by the Issuer or the Trustee of the requisite
number of consents, (ii) satisfaction of conditions to effectiveness as set
forth in this Indenture and any indenture supplemental hereto containing such
amendment or waiver and (iii) execution of such amendment or waiver (or
supplemental indenture) by the Issuer, the Note Guarantors and the Trustee.
(b) The Issuer may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to give their consent or take
any other action described above or required or permitted to be taken pursuant
to this Indenture. If a record date is fixed, then notwithstanding the
immediately preceding paragraph, those Persons who were Holders at such record
date (or their duly designated proxies), and only those Persons, shall be
entitled to give such consent or to revoke any consent previously given or to
take any such action, whether or not such Persons continue to be Holders after
such record date. No such consent shall be valid or effective for more than 120
days after such record date.
SECTION 9.05. Notation on or Exchange of Securities. If an amendment
changes the terms of a Security, the Trustee may require the Holder of the
Security to deliver it to the Trustee. The Trustee may place an appropriate
notation on the Security regarding the changed terms and return it to the
Holder. Alternatively, if the Issuer or the Trustee so determines, the Issuer in
exchange for the Security shall issue and the Trustee shall authenticate a new
Security that reflects the changed terms. Failure to make the appropriate
notation or to issue a new Security shall not affect the validity of such
amendment.
SECTION 9.06. Trustee to Sign Amendments. The Trustee shall sign any
amendment authorized pursuant to this Article 9 if the amendment does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may but need not sign it. In signing such amendment the
Trustee shall be entitled to receive indemnity reasonably satisfactory to it and
to receive, and (subject to Section 7.01) shall be fully protected in relying
upon, an Officers' Certificate and an Opinion of Counsel stating that such
amendment is authorized or permitted by this Indenture and that such amendment
is the legal, valid and binding obligation of the Issuer and the Note Guarantors
enforceable against them in accordance with its terms, subject to customary
exceptions, and complies with the provisions hereof (including Section 9.03).
SECTION 9.07. Payment for Consent. Neither the Issuer nor any Affiliate of
the Issuer shall, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any Holder for
or as an
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inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture or the Securities unless such consideration is offered to be
paid to all Holders that so consent, waive or agree to amend in the time frame
set forth in solicitation documents relating to such consent, waiver or
agreement.
ARTICLE 10
Subordination
SECTION 10.01. Agreement To Subordinate. The Issuer agrees, and each Holder
by accepting a Security agrees, that the Indebtedness evidenced by the
Securities is subordinated in right of payment, to the extent and in the manner
provided in this Article 10, to the prior payment in full of all Senior
Indebtedness of the Issuer and that the subordination is for the benefit of and
enforceable by the holders of such Senior Indebtedness. The Securities shall in
all respects rank pari passu with all other Senior Subordinated Indebtedness of
the Issuer and shall rank senior to all existing and future Subordinated
Obligations of the Issuers; and only Indebtedness of the Issuer that is Senior
Indebtedness of the Issuer shall rank senior to the Securities in accordance
with the provisions set forth herein. For purposes of this Article 10, the
Indebtedness evidenced by the Securities shall be deemed to include any
liquidated damages payable pursuant to the provisions set forth in the
Securities and the Registration Agreement. All provisions of this Article 10
shall be subject to Section 10.12.
SECTION 10.02. Liquidation, Dissolution, Bankruptcy. Upon any payment or
distribution of the assets of the Issuer to creditors upon a total or partial
liquidation or a total or partial dissolution of the Issuer or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to the
Issuer or its property:
(a) holders of Senior Indebtedness of the Issuer shall be entitled to
receive payment in full in cash of such Senior Indebtedness before Holders
shall be entitled to receive any payment of principal of, premium (if any),
or interest on or any other amount owing in respect of the Securities; and
(b) until the Senior Indebtedness of the Issuer is paid in full in
cash, any payment or distribution to which Holders would be entitled but
for this Article 10 shall be made to holders of such Senior Indebtedness as
their interests may appear, except that Holders may receive and retain (i)
Permitted Junior Securities and (ii) payments made from the trust described
in Section 8.01; provided, that on the date or dates the respective amounts
were paid into the trust, such payments were made with respect to the
Securities without violating this Article 10.
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SECTION 10.03. Default on Senior Indebtedness. The Issuer may not pay the
principal of, premium (if any), liquidated damages (if any) or interest on the
Securities or make any deposit pursuant to Section 8.01 and may not otherwise
purchase, repurchase, redeem or otherwise acquire or retire for value any
Securities (collectively, "pay the Securities") if (a) any principal of, premium
(if any) or interest on, or other amount owing in respect of any Designated
Senior Indebtedness of the Issuer is not paid when due or (b) any other default
on Designated Senior Indebtedness of the Issuer occurs and the maturity of such
Designated Senior Indebtedness is accelerated in accordance with its terms
unless, in either case, (i) the default has been cured or waived and any such
acceleration has been rescinded or (ii) such Designated Senior Indebtedness has
been paid in full in cash; provided, however, that the Issuer may pay the
Securities without regard to the foregoing if the Issuer and the Trustee receive
written notice approving such payment from the Representative of the Designated
Senior Indebtedness with respect to which either of the events set forth in
clause (a) or (b) of this sentence has occurred and is continuing. During the
continuance of any default (other than a default described in clause (a) or (b)
of the preceding sentence) with respect to any Designated Senior Indebtedness of
the Issuer pursuant to which the maturity thereof may be accelerated immediately
without further notice (except such notice as may be required to effect such
acceleration) or the expiration of any applicable grace periods, the Issuer may
not pay the Securities for a period (a "Payment Blockage Period") commencing
upon the receipt by the Trustee (with a copy to the Issuer) of written notice (a
"Blockage Notice") of such default from the Representative of such Designated
Senior Indebtedness specifying an election to effect a Payment Blockage Period
and ending 179 days thereafter (or earlier if such Payment Blockage Period is
terminated (a) by written notice to the Trustee and the Issuer from the Person
or Persons who gave such Blockage Notice, (b) by repayment in full in cash of
such Designated Senior Indebtedness or (c) because the default giving rise to
such Blockage Notice is no longer continuing). Notwithstanding the provisions
described in the immediately preceding sentence (but subject to the provisions
contained in the first sentence of this Section 10.03 and in the two immediately
succeeding sentences), unless the holders of such Designated Senior Indebtedness
or the Representative of such holders shall have accelerated the maturity of
such Designated Senior Indebtedness, the Issuer may resume payments on the
Securities after the end of such Payment Blockage Period, including any missed
payments. Not more than one Blockage Notice may be given in any consecutive
360-day period, irrespective of the number of defaults with respect to
Designated Senior Indebtedness during such period; provided, however, that if
any Blockage Notice within such 360-day period is given by or on behalf of any
holders of Designated Senior Indebtedness other than the Bank Indebtedness, the
Representative of the Bank Indebtedness may give another Blockage Notice within
such period; provided further, however, that in no event may the total number of
days during which any Payment Blockage Period or Periods is in effect exceed 179
days in the aggregate during any 360 consecutive day period. For purposes of
this Section 10.03, no default or event of default that existed or was
continuing on the date of the commencement of any Payment Blockage Period with
respect to the Designated
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Senior Indebtedness initiating such Payment Blockage Period shall be, or be
made, the basis of the commencement of a subsequent Payment Blockage Period by
the Representative of such Designated Senior Indebtedness, whether or not within
a period of 360 consecutive days, unless such default or event of default shall
have been cured or waived for a period of not less than 90 consecutive days.
SECTION 10.04. Acceleration of Payment of Securities. If payment of the
Securities is accelerated because of an Event of Default, the Issuer or the
Trustee (provided, that the Trustee shall have received written notice from the
Issuer, on which notice the Trustee shall be entitled to conclusively rely)
shall promptly notify the holders of the Designated Senior Indebtedness of the
Issuer (or their Representative) of the acceleration. If any Designated Senior
Indebtedness of the Issuer is outstanding, the Issuer may not pay the Securities
until five Business Days after such holders or the Representative of such
Designated Senior Indebtedness receive notice of such acceleration and,
thereafter, may pay the Securities only if this Article 10 otherwise permits
payment at that time.
SECTION 10.05. When Distribution Must Be Paid Over. If a distribution is
made to Holders that because of this Article 10 should not have been made to
them, the Holders who receive the distribution shall hold it in trust for
holders of Senior Indebtedness of the Issuer and pay it over to them as their
interests may appear.
SECTION 10.06. Subrogation. After all Senior Indebtedness of the Issuer is
paid in full in cash and until the Securities are paid in full in cash, Holders
shall be subrogated to the rights of holders of such Senior Indebtedness to
receive distributions applicable to Senior Indebtedness. A distribution made
under this Article 10 to holders of such Senior Indebtedness which otherwise
would have been made to Holders is not, as between the Issuer and Holders, a
payment by the Issuer on such Senior Indebtedness.
SECTION 10.07. Relative Rights. This Article 10 defines the relative rights
of Holders and holders of Senior Indebtedness of the Issuer. Nothing in this
Indenture shall:
(a) impair, as between the Issuer and Holders, the obligation of the
Issuer, which is absolute and unconditional, to pay principal of and
premium, if any, interest and liquidated damages, if any, on the Securities
in accordance with their terms; or
(b) prevent the Trustee or any Holder from exercising its available
remedies upon a Default, subject to the rights of holders of Senior
Indebtedness of the Issuer to receive distributions otherwise payable to
Holders.
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SECTION 10.08. Subordination May Not Be Impaired by Issuer. No right of any
holder of Senior Indebtedness of the Issuer to enforce the subordination of the
Indebtedness evidenced by the Securities shall be impaired by any act or failure
to act by the Issuer or by its failure to comply with this Indenture.
SECTION 10.09. Rights of Trustee and Paying Agent. Notwithstanding Section
10.03, the Trustee or Paying Agent may continue to make payments on the
Securities and shall not be charged with knowledge of the existence of facts
that would prohibit the making of any such payments unless a Trust Officer of
the Trustee receives notice reasonably satisfactory to it that payments may not
be made under this Article 10, and, prior to the receipt of any such written
notice, the Trustee, subject to TIA Sections 315(a) through 315(d), shall be
entitled to assume (in the absence of actual knowledge to the contrary) that no
such facts exist. The Issuer, the Registrar, the Paying Agent, a Representative
or a holder of Senior Indebtedness of the Issuer may give the notice; provided,
however, that, if an issue of Senior Indebtedness of the Issuer has a
Representative, only the Representative may give the notice.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness of the Issuer with the same rights it would have if it were not
Trustee. The Registrar and the Paying Agent may do the same with like rights.
The Trustee shall be entitled to all the rights set forth in this Article 10
with respect to any Senior Indebtedness of the Issuer which may at any time be
held by it, to the same extent as any other holder of such Senior Indebtedness;
and nothing in Article 7 shall deprive the Trustee of any of its rights as such
holder. Nothing in this Article 10 shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 7.07 or any other Section of this
Indenture.
SECTION 10.10. Distribution or Notice to Representative. Whenever a
distribution is to be made or a notice given to holders of Senior Indebtedness
of the Issuer, the distribution may be made and the notice given to their
Representative (if any).
SECTION 10.11. Article 10 Not To Prevent Events of Default or Limit Right
To Accelerate. The failure to make a payment pursuant to the Securities by
reason of any provision in this Article 10 shall not be construed as preventing
the occurrence of a Default. Nothing in this Article 10 shall have any effect on
the right of the Holders or the Trustee to accelerate the maturity of the
Securities.
SECTION 10.12. Trust Monies Not Subordinated. Notwithstanding anything
contained herein to the contrary, payments from money or the proceeds of U.S.
Government Obligations held in trust under Article 8 by the Trustee for the
payment of principal of and premium, if any, interest and liquidated damages, if
any, on the Securities shall not be subordinated to the prior payment of any
Senior Indebtedness of the Issuer or subject to the restrictions set forth in
this Article 10, and none of the Holders shall be
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obligated to pay over any such amount to the Issuer or any holder of Senior
Indebtedness of the Issuer or any other creditor of the Issuer.
SECTION 10.13. Trustee Entitled To Rely. Upon any payment or distribution
pursuant to this Article 10, the Trustee and the Holders shall be entitled to
rely (a) upon any order or decree of a court of competent jurisdiction in which
any proceedings of the nature referred to in Section 10.02 are pending, (b) upon
a certificate of the liquidating trustee or agent or other Person making such
payment or distribution to the Trustee or to the Holders or (c) upon the
Representatives for the holders of Senior Indebtedness of the Issuer for the
purpose of ascertaining the Persons entitled to participate in such payment or
distribution, the holders of such Senior Indebtedness and other Indebtedness of
the Issuer, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article 10.
In the event that the Trustee determines, in good faith, that evidence is
required with respect to the right of any Person as a holder of Senior
Indebtedness of the Issuer to participate in any payment or distribution
pursuant to this Article 10, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of such
Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and other facts
pertinent to the rights of such Person under this Article 10, and, if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment. The provisions of Sections 7.01 and 7.02 shall be applicable to all
actions or omissions of actions by the Trustee pursuant to this Article 10.
SECTION 10.14. Trustee To Effectuate Subordination. Each Holder by
accepting a Security authorizes and directs the Trustee on his behalf to take
such action as may be necessary or appropriate to acknowledge or effectuate the
subordination between the Holders and the holders of Senior Indebtedness of the
Issuer as provided in this Article 10 and appoints the Trustee as
attorney-in-fact for any and all such purposes.
SECTION 10.15. Trustee Not Fiduciary for Holders of Senior Indebtedness.
With respect to the holders of Senior Indebtedness, the Trustee undertakes to
perform or to observe only such of its covenants or obligations as are
specifically set forth in this Article and no implied covenants or obligations
with respect to holders of Senior Indebtedness shall be read into this Indenture
against the Trustee.
SECTION 10.16. Reliance by Holders of Senior Indebtedness on Subordination
Provisions. Each Holder by accepting a Security acknowledges and agrees that the
foregoing subordination provisions are, and are intended to be, an inducement
and a consideration to each holder of any Senior Indebtedness of the Issuer,
whether such Senior Indebtedness was created or acquired before or after the
issuance of the Securities, to acquire and continue to hold, or to continue to
hold, such Senior Indebtedness and such
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holder of such Senior Indebtedness shall be deemed conclusively to have relied
on such subordination provisions in acquiring and continuing to hold, or in
continuing to hold, such Senior Indebtedness.
ARTICLE 11
Note Guarantees
SECTION 11.01. Note Guarantees. (a) Each Note Guarantor hereby jointly and
severally irrevocably and unconditionally guarantees, as a primary obligor and
not merely as a surety, to each Holder and to the Trustee and its successors and
assigns (i) the full and punctual payment when due, whether at Stated Maturity,
by acceleration, by redemption or otherwise, of all obligations of the Issuer
under this Indenture (including obligations to the Trustee) and the Securities,
whether for payment of principal of, interest on or liquidated damages, if any,
in respect of the Securities and all other monetary obligations of the Issuer
under this Indenture and the Securities and (ii) the full and punctual
performance within applicable grace periods of all other obligations of the
Issuer whether for fees, expenses, indemnification or otherwise under this
Indenture and the Securities (all the foregoing being hereinafter collectively
called the "Guaranteed Obligations"). Each Note Guarantor further agrees that
the Guaranteed Obligations may be extended or renewed, in whole or in part,
without notice or further assent from each such Note Guarantor, and that each
such Note Guarantor shall remain bound under this Article 11 notwithstanding any
extension or renewal of any Guaranteed Obligation.
(b) Each Note Guarantor waives presentation to, demand of payment from and
protest to the Issuer of any of the Guaranteed Obligations and also waives
notice of protest for nonpayment. Each Note Guarantor waives notice of any
default under the Securities or the Guaranteed Obligations. The obligations of
each Note Guarantor hereunder shall not be affected by (i) the failure of any
Holder or the Trustee to assert any claim or demand or to enforce any right or
remedy against the Issuer or any other Person under this Indenture, the
Securities or any other agreement or otherwise; (ii) any extension or renewal of
any thereof; (iii) any rescission, waiver, amendment or modification of any of
the terms or provisions of this Indenture, the Securities or any other
agreement; (iv) the release of any security held by any Holder or the Trustee
for the Guaranteed Obligations or any of them; (v) the failure of any Holder or
Trustee to exercise any right or remedy against any other guarantor of the
Guaranteed Obligations; or (vi) any change in the ownership of such Note
Guarantor, except as provided in Section 11.02(b).
(c) Each Note Guarantor hereby waives any right to which it may be entitled
to have its obligations hereunder divided among the Note Guarantors, such that
such Note Guarantor's obligations would be less than the full amount claimed.
Each Note
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Guarantor hereby waives any right to which it may be entitled to have the assets
of the Issuer first be used and depleted as payment of the Issuer's or such Note
Guarantor's obligations hereunder prior to any amounts being claimed from or
paid by such Note Guarantor hereunder. Each Note Guarantor hereby waives any
right to which it may be entitled to require that the Issuer be sued prior to an
action being initiated against such Note Guarantor.
(d) Each Note Guarantor further agrees that its Note Guarantee herein
constitutes a guarantee of payment, performance and compliance when due (and not
a guarantee of collection) and waives any right to require that any resort be
had by any Holder or the Trustee to any security held for payment of the
Guaranteed Obligations.
(e) The Note Guarantee of each Note Guarantor is, to the extent and in the
manner set forth in Article 12, subordinated and subject in right of payment to
the prior payment in full in cash of the principal of and premium, if any, and
interest on all Senior Indebtedness of the relevant Note Guarantor and is made
subject to such provisions of this Indenture.
(f) Except as expressly set forth in Sections 8.01(b), 11.02 and 11.06, the
obligations of each Note Guarantor hereunder shall not be subject to any
reduction, limitation, impairment or termination for any reason, including any
claim of waiver, release, surrender, alteration or compromise, to the extent
permitted by applicable law, and shall not be subject to any defense of setoff,
counterclaim, recoupment or termination whatsoever or by reason of the
invalidity, illegality or unenforceability of the Guaranteed Obligations or
otherwise. Without limiting the generality of the foregoing, the obligations of
each Note Guarantor herein shall not be discharged or impaired or otherwise
affected by the failure of any Holder or the Trustee to assert any claim or
demand or to enforce any remedy under this Indenture, the Securities or any
other agreement, by any waiver or modification of any thereof, by any default,
failure or delay, wilful or otherwise, in the performance of the obligations, or
by any other act or thing or omission or delay to do any other act or thing
which may or might in any manner or to any extent vary the risk of any Note
Guarantor or would otherwise operate as a discharge of any Note Guarantor as a
matter of law or equity.
(g) Each Note Guarantor agrees that its Note Guarantee shall remain in full
force and effect until payment in full of all the Guaranteed Obligations. Each
Note Guarantor further agrees that its Note Guarantee herein shall continue to
be effective or be reinstated, as the case may be, if at any time payment, or
any part thereof, of principal of or interest or liquidated damages, if any, on
any Guaranteed Obligation is rescinded or must otherwise be restored by any
Holder or the Trustee upon the bankruptcy or reorganization of the Issuer or
otherwise.
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(h) In furtherance of the foregoing and not in limitation of any other
right which any Holder or the Trustee has at law or in equity against any Note
Guarantor by virtue hereof, upon the failure of the Issuer to pay the principal
of or interest or liquidated damages, if any, on any Guaranteed Obligation when
and as the same shall become due, whether at maturity, by acceleration, by
redemption or otherwise, or to perform or comply with any other Guaranteed
Obligation, each Note Guarantor hereby promises to and shall, upon receipt of
written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to
the Holders or the Trustee an amount equal to the sum of (i) the unpaid
principal amount of such Guaranteed Obligations, (ii) accrued and unpaid
interest on such Guaranteed Obligations (but only to the extent not prohibited
by law) and (iii) all other monetary obligations of the Company to the Holders
and the Trustee.
(i) Each Note Guarantor agrees that it shall not be entitled to any right
of subrogation in relation to the Holders in respect of any Guaranteed
Obligations guaranteed hereby until payment in full of all Guaranteed
Obligations and all obligations to which the Guaranteed Obligations are
subordinated as provided in Article 12. Each Note Guarantor further agrees that,
as between it, on the one hand, and the Holders and the Trustee, on the other
hand, (i) the maturity of the Guaranteed Obligations guaranteed hereby may be
accelerated as provided in Article 6 for the purposes of any Note Guarantee
herein, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the Guaranteed Obligations guaranteed hereby,
and (ii) in the event of any declaration of acceleration of such Guaranteed
Obligations as provided in Article 6, such Guaranteed Obligations (whether or
not due and payable) shall forthwith become due and payable by such Note
Guarantor for the purposes of this Section 11.01.
(j) Each Note Guarantor also agrees to pay any and all costs and expenses
(including reasonable attorneys' fees and expenses) incurred by the Trustee or
any Holder in enforcing any rights under this Section 11.01.
(k) Upon request of the Trustee, each Note Guarantor shall execute and
deliver such further instruments and do such further acts as may be reasonably
necessary or proper to carry out more effectively the purpose of this Indenture.
SECTION 11.02. Limitation on Liability. (a) Any term or provision of this
Indenture to the contrary notwithstanding, the maximum aggregate amount of the
Guaranteed Obligations guaranteed hereunder by any Note Guarantor shall not
exceed the maximum amount that can be hereby guaranteed without rendering this
Indenture, as it relates to such Note Guarantor, voidable under applicable law
relating to fraudulent conveyance or fraudulent transfer or similar laws
affecting the rights of creditors generally.
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(b) A Note Guarantee as to any Note Guarantor that is a Subsidiary of the
Company (other than Intermediate Holdings or HDD Holdings) shall terminate and
be of no further force or effect and such Note Guarantor shall be deemed to be
released from all obligations under this Article 11 upon (i) the merger or
consolidation of such Note Guarantor with or into any Person other than the
Company or a Subsidiary or Affiliate of the Company where such Note Guarantor is
not the surviving entity of such consolidation or merger or (ii) the sale by the
Company or any Subsidiary of the Company (or any pledgee of the Company or any
Subsidiary of the Company) of the Capital Stock of such Note Guarantor, where,
after such sale, such Note Guarantor is no longer a Subsidiary of the Company;
provided, however, that each such merger, consolidation or sale (or, in the case
of a sale by such a pledgee, the disposition of the proceeds of such sale) shall
comply with Section 4.06 and Section 5.01(b). At the request of the Company, the
Trustee shall execute and deliver an appropriate instrument evidencing such
release (in the form provided by the Company).
(c) A Note Guarantee of any Note Guarantor that is a Subsidiary of the
Company shall terminate and be of no further force or effect and such Note
Guarantor shall be deemed to be released from all obligations under this Article
11 upon the Company's designation of such Note Guarantor as an Unrestricted
Subsidiary; provided that such designation complies with the other applicable
provisions of this Indenture.
(d) At any time that Bank Indebtedness is outstanding, if any Subsidiary of
the Company is released from its Guarantee of, and all pledges and security
interests granted in connection with, the Credit Agreement, then such Subsidiary
shall, at the option of the Company, be released and relieved of any obligations
under its Note Guarantee.
(e) (i) At any time that no Bank Indebtedness is outstanding, each
Subsidiary of the Company (other than Intermediate Holdings or HDD Holdings)
that has no outstanding Indebtedness shall, at the option of the Company, be
released from its Note Guarantee; provided, that following any such release the
Company shall comply with the provisions of Section 4.11 with respect to such
Subsidiary and (ii) each Designated Subsidiary (and each Subsidiary of such
Designated Subsidiary) shall be released from its Note Guarantee upon the first
Qualified Releasing Event with respect to such Designated Subsidiary.
(f) A Note Guarantee of any Note Guarantor that is a Subsidiary of the
Company shall terminate and be of no further force or effect and such Note
Guarantor shall be deemed to be released from all obligations under this Article
11 upon such Note Guarantor ceasing to be a Subsidiary of the Company as a
result of any foreclosure on any pledge or security interest securing Bank
Indebtedness or other exercise of remedies in respect thereof if such Note
Guarantor is released from its Guarantee of, and all pledges and security
interests granted in connection with, the Credit Agreement.
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SECTION 11.03. Successors and Assigns. This Article 11 shall be binding
upon each Note Guarantor and its successors and assigns and shall inure to the
benefit of the successors and assigns of the Trustee and the Holders and, in the
event of any transfer or assignment of rights by any Holder or the Trustee, the
rights and privileges conferred upon that party in this Indenture and in the
Securities shall automatically extend to and be vested in such transferee or
assignee, all subject to the terms and conditions of this Indenture.
SECTION 11.04. No Waiver. Neither a failure nor a delay on the part of
either the Trustee or the Holders in exercising any right, power or privilege
under this Article 11 shall operate as a waiver thereof, nor shall a single or
partial exercise thereof preclude any other or further exercise of any right,
power or privilege. The rights, remedies and benefits of the Trustee and the
Holders herein expressly specified are cumulative and not exclusive of any other
rights, remedies or benefits which either may have under this Article 11 at law,
in equity, by statute or otherwise.
SECTION 11.05. Modification. No modification, amendment or waiver of any
provision of this Article 11, nor the consent to any departure by any Note
Guarantor therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Trustee, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given. No
notice to or demand on any Note Guarantor in any case shall entitle such Note
Guarantor to any other or further notice or demand in the same, similar or other
circumstances.
SECTION 11.06. Execution of Supplemental Indenture for Future Note
Guarantors. Each Subsidiary of the Company which is required to become a Note
Guarantor pursuant to Section 4.11 shall promptly execute and deliver to the
Trustee a supplemental indenture in the form of Exhibit C hereto pursuant to
which such Subsidiary shall become a Note Guarantor under this Article 11 and
shall guarantee the Guaranteed Obligations. Concurrently with the execution and
delivery of such supplemental indenture, the Issuer shall deliver to the Trustee
an Opinion of Counsel and an Officers' Certificate to the effect that such
supplemental indenture has been duly authorized, executed and delivered by such
Subsidiary and that, subject to the application of bankruptcy, insolvency,
moratorium, fraudulent conveyance or transfer and other similar laws relating to
creditors' rights generally and to the principles of equity, whether considered
in a proceeding at law or in equity, the Note Guarantee of such Note Guarantor
is a legal, valid and binding obligation of such Note Guarantor, enforceable
against such Note Guarantor in accordance with its terms and or to such other
matters as the Trustee may reasonably request.
SECTION 11.07. Non-Impairment. The failure to endorse a Note Guarantee on
any Security shall not affect or impair the validity thereof.
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ARTICLE 12
Subordination of the Note Guarantees
SECTION 12.01. Agreement To Subordinate. Each Note Guarantor agrees, and
each Holder by accepting a Security agrees, that the obligations of a Note
Guarantor hereunder are subordinated in right of payment, to the extent and in
the manner provided in this Article 12, to the prior payment in full in cash of
all Senior Indebtedness of such Note Guarantor and that the subordination is for
the benefit of and enforceable by the holders of such Senior Indebtedness of
such Note Guarantor. The obligations hereunder with respect to a Note Guarantor
shall in all respects rank pari passu with all other Senior Subordinated
Indebtedness of such Note Guarantor and shall rank senior to all existing and
future Subordinated Obligations of such Note Guarantor; and only Indebtedness of
such Note Guarantor that is Senior Indebtedness of such Note Guarantor shall
rank senior to the obligations of such Note Guarantor in accordance with the
provisions set forth herein.
SECTION 12.02. Liquidation, Dissolution, Bankruptcy. Upon any payment or
distribution of the assets of a Note Guarantor to creditors upon a total or
partial liquidation or a total or partial dissolution of such Note Guarantor or
in a bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to such Note Guarantor or its property:
(a) holders of Senior Indebtedness of such Note Guarantor shall be
entitled to receive payment in full in cash of such Senior Indebtedness
before Holders shall be entitled to receive any payment pursuant to any
Guaranteed Obligations from such Note Guarantor; and
(b) until the Senior Indebtedness of such Note Guarantor is paid in
full in cash, any payment or distribution to which Holders would be
entitled but for this Article 12 shall be made to holders of such Senior
Indebtedness as their respective interests may appear, except that Holders
may receive and retain (i) Permitted Junior Securities and (ii) payments
made from the trust described under Section 8.01 so long as, on the date or
dates the respective amounts were paid into the trust, such payments were
made with respect to the Securities without violating this Article 12).
SECTION 12.03. Default on Designated Senior Indebtedness of a Note
Guarantor. A Note Guarantor may not make any payment pursuant to any of the
Guaranteed Obligations or purchase, repurchase, redeem or otherwise acquire or
retire for value any Securities (collectively, "pay its Guarantee") if (a) any
principal of, premium (if any) or interest on or other amount owing in respect
of any Designated Senior Indebtedness of such Note Guarantor is not paid when
due or (b) any other default on
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Designated Senior Indebtedness of such Note Guarantor occurs and the maturity of
such Designated Senior Indebtedness is accelerated in accordance with its terms
unless, in either case, (i) the default has been cured or waived and any such
acceleration has been rescinded or (ii) such Designated Senior Indebtedness has
been paid in full in cash; provided, however, that such Guarantor may pay its
Guarantee without regard to the foregoing if such Note Guarantor and the Trustee
receive written notice approving such payment from the Representative of the
Designated Senior Indebtedness with respect to which either of the events in
clause (a) or (b) of this sentence has occurred and is continuing. During the
continuance of any default (other than a default described in clause (a) or (b)
of the preceding sentence) with respect to any Designated Senior Indebtedness of
a Note Guarantor pursuant to which the maturity thereof may be accelerated
immediately without further notice (except such notice as may be required to
effect such acceleration) or the expiration of any applicable grace periods,
such Note Guarantor may not pay its Guarantee for a period (a "Guarantee Payment
Blockage Period") commencing upon the receipt by the Trustee (with a copy to
such Note Guarantor and the Issuer) of written notice (a "Guarantee Blockage
Notice") of such default from the Representative of such Designated Senior
Indebtedness of such Note Guarantor specifying an election to effect a Guarantee
Payment Blockage Period and ending 179 days thereafter (or earlier if such
Guarantee Payment Blockage Period is terminated (a) by written notice to the
Trustee (with a copy to such Note Guarantor and the Issuer) from the Person or
Persons who gave such Guarantee Blockage Notice, (b) by the repayment in full in
cash of such Designated Senior Indebtedness or (c) because the default giving
rise to such Guarantee Blockage Notice is no longer continuing). Notwithstanding
the provisions described in the immediately preceding sentence (but subject to
the provisions contained in the first sentence of this Section 12.03 and in the
two immediately succeeding sentences), unless the holders of such Designated
Senior Indebtedness or the Representative of such holders shall have accelerated
the maturity of such Designated Senior Indebtedness, such Note Guarantor may
resume payments of its Note Guarantee after the end of such Guarantee Payment
Blockage Period, including any missed payments. Not more than one Guarantee
Blockage Notice may be given with respect to a Note Guarantor in any consecutive
360-day period, irrespective of the number of defaults with respect to
Designated Senior Indebtedness of such Note Guarantor during such period;
provided, however, that if any Guarantee Blockage Notice within such 360-day
period is given by or on behalf of any holders of Designated Senior Indebtedness
of such Note Guarantor other than the Bank Indebtedness, the Representative of
the Bank Indebtedness may give another Guarantee Blockage Notice within such
period; provided further, however, that in no event may the total number of days
during which any Guarantee Payment Blockage Period or Periods is in effect
exceed 179 days in the aggregate during any 360 consecutive day period. For
purposes of this Section 12.03, no Default or Event of Default that existed or
was continuing on the date of the commencement of any Guarantee Payment Blockage
Period with respect to the Designated Senior Indebtedness initiating such
Guarantee Payment Blockage Period shall be, or be made, the basis of the
commencement of a subsequent Guarantee Payment
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Blockage Period by the Representative of such Designated Senior Indebtedness,
whether or not within a period of 360 consecutive days, unless such Default or
Event of Default shall have been cured or waived for a period of not less than
90 consecutive days.
SECTION 12.04. Demand for Payment. If payment of the Securities is
accelerated because of an Event of Default and a demand for payment is made on a
Note Guarantor pursuant to Article 11, the Trustee (provided that the Trustee
shall have received written notice from the Issuer or such Note Guarantor, on
which notice the Trustee shall be entitled to conclusively rely) shall promptly
notify the holders of the Designated Senior Indebtedness of such Note Guarantor
(or their Representative) of such demand. If any Designated Senior Indebtedness
of such Note Guarantor is outstanding, such Note Guarantor may not pay its
Guarantee until five Business Days after such holders or the Representative of
the Designated Senior Indebtedness of such Note Guarantor receive notice of such
demand and, thereafter, may pay its Guarantee only if this Article 12 otherwise
permits payment at that time.
SECTION 12.05. When Distribution Must Be Paid Over. If a distribution is
made to Holders that because of this Article 12 should not have been made to
them, the Holders who receive the distribution shall hold it in trust for
holders of the Senior Indebtedness of the relevant Note Guarantor and pay it
over to them as their respective interests may appear.
SECTION 12.06. Subrogation. After all Senior Indebtedness of a Note
Guarantor is paid in full in cash and until the Securities are paid in full in
cash, Holders shall be subrogated to the rights of holders of Senior
Indebtedness of such Note Guarantor to receive distributions applicable to
Senior Indebtedness of such Note Guarantor. A distribution made under this
Article 12 to holders of Senior Indebtedness of such Note Guarantor which
otherwise would have been made to Holders is not, as between such Note Guarantor
and Holders, a payment by such Note Guarantor on Senior Indebtedness of such
Note Guarantor.
SECTION 12.07. Relative Rights. This Article 12 defines the relative rights
of Holders and holders of Senior Indebtedness of a Note Guarantor. Nothing in
this Indenture shall:
(a) impair, as between a Note Guarantor and Holders, the obligation of
a Note Guarantor which is absolute and unconditional, to make payments with
respect to the Guaranteed Obligations to the extent set forth in Article
11; or
(b) prevent the Trustee or any Holder from exercising its available
remedies upon a default by a Note Guarantor under its obligations with
respect to the Guaranteed Obligations, subject to the rights of holders of
Senior Indebtedness of such Note Guarantor to receive distributions
otherwise payable to Holders.
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SECTION 12.08. Subordination May Not Be Impaired by a Note Guarantor. No
right of any holder of Senior Indebtedness of a Note Guarantor to enforce the
subordination of the obligations of such Note Guarantor hereunder shall be
impaired by any act or failure to act by such Guarantor or by its failure to
comply with this Indenture.
SECTION 12.09. Rights of Trustee and Paying Agent. Notwithstanding Section
12.03, the Trustee or the Paying Agent may continue to make payments on the
Securities and shall not be charged with knowledge of the existence of facts
that would prohibit the making of any such payments unless a Trust Officer of
the Trustee receives notice reasonably satisfactory to it that payments may not
be made under this Article 12, and, prior to the receipt of any such written
notice, the Trustee, subject to TIA Sections 315(a) through 315(d), shall be
entitled to assume (in the absence of actual knowledge to the contrary) that no
such facts exist. A Note Guarantor, the Registrar or co-registrar, the Paying
Agent, a Representative or a holder of Senior Indebtedness of a Note Guarantor
may give the notice; provided, however, that if an issue of Senior Indebtedness
of a Note Guarantor has a Representative, only the Representative may give the
notice.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness of a Note Guarantor with the same rights it would have if it were
not Trustee. The Registrar and co-registrar and the Paying Agent may do the same
with like rights. The Trustee shall be entitled to all the rights set forth in
this Article 12 with respect to any Senior Indebtedness of a Note Guarantor
which may at any time be held by it, to the same extent as any other holder of
such Senior Indebtedness of such Note Guarantor; and nothing in Article 7 shall
deprive the Trustee of any of its rights as such holder. Nothing in this Article
12 shall apply to claims of, or payments to, the Trustee under or pursuant to
Section 7.07 or any other applicable Section of this Indenture.
SECTION 12.10. Distribution or Notice to Representative. Whenever a
distribution is to be made or a notice given to holders of Senior Indebtedness
of a Note Guarantor, the distribution may be made and the notice given to their
Representative (if any).
SECTION 12.11. Article 12 Not To Prevent Events of Default or Limit Right
To Accelerate. The failure of a Note Guarantor to make a payment on any of its
obligations by reason of any provision in this Article 12 shall not be construed
as preventing the occurrence of a default by such Note Guarantor under such
obligations. Nothing in this Article 12 shall have any effect on the right of
the Holders or the Trustee to make a demand for payment on a Note Guarantor
pursuant to Article 11.
SECTION 12.12. Trustee Entitled To Rely. Upon any payment or distribution
pursuant to this Article 12, the Trustee and the Holders shall be entitled to
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rely (a) upon any order or decree of a court of competent jurisdiction in which
any proceedings of the nature referred to in Section 12.02 are pending, (b) upon
a certificate of the liquidating trustee or agent or other Person making such
payment or distribution to the Trustee or to the Holders or (c) upon the
Representatives for the holders of Senior Indebtedness of a Note Guarantor for
the purpose of ascertaining the Persons entitled to participate in such payment
or distribution, the holders of the Senior Indebtedness of a Note Guarantor and
other Indebtedness of a Note Guarantor, the amount thereof or payable thereon,
the amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article 12. In the event that the Trustee determines, in good
faith, that evidence is required with respect to the right of any Person as a
holder of Senior Indebtedness of a Note Guarantor to participate in any payment
or distribution pursuant to this Article 12, the Trustee may request such Person
to furnish evidence to the reasonable satisfaction of the Trustee as to the
amount of Senior Indebtedness of such Note Guarantor held by such Person, the
extent to which such Person is entitled to participate in such payment or
distribution and other facts pertinent to the rights of such Person under this
Article 12, and, if such evidence is not furnished, the Trustee may defer any
payment to such Person pending judicial determination as to the right of such
Person to receive such payment. The provisions of Sections 7.01 and 7.02 shall
be applicable to all actions or omissions of actions by the Trustee pursuant to
this Article 12.
SECTION 12.13. Trustee To Effectuate Subordination. Each Holder by
accepting a Security authorizes and directs the Trustee on his or her behalf to
take such action as may be necessary or appropriate to acknowledge or effectuate
the subordination between the Holders and the holders of Senior Indebtedness of
each of the Note Guarantors as provided in this Article 12 and appoints the
Trustee as attorney-in-fact for any and all such purposes.
SECTION 12.14. Trustee Not Fiduciary for Holders of Senior Indebtedness of
a Note Guarantor. With respect to the holders of Senior Indebtedness, the
Trustee undertakes to perform or to observe only such of its covenants or
obligations as are specifically set forth in this Article and no implied
covenants or obligations with respect to holders of Senior Indebtedness shall be
read into this Indenture against the Trustee.
SECTION 12.15. Reliance by Holders of Senior Indebtedness of a Note
Guarantor on Subordination Provisions. Each Holder by accepting a Security
acknowledges and agrees that the foregoing subordination provisions are, and are
intended to be, an inducement and a consideration to each holder of any Senior
Indebtedness of a Note Guarantor, whether such Senior Indebtedness was created
or acquired before or after the issuance of the Securities, to acquire and
continue to hold, or to continue to hold, such Senior Indebtedness and such
holder of Senior Indebtedness shall be deemed conclusively to have relied on
such subordination provisions in acquiring and continuing to hold, or in
continuing to hold, such Senior Indebtedness.
100
SECTION 12.16. Defeasance. Notwithstanding anything contained herein to the
contrary, payments from money or the proceeds of U.S. Government Obligations
held in trust under Article 8 by the Trustee for the payment of principal of,
and interest and liquidated damages, if any, on, the Securities shall not be
subordinated to the prior payment of any Senior Indebtedness of any Note
Guarantor or be subject to the restrictions set forth in this Article 12, and
none of the Holders shall be obligated to pay over any such amount to a Note
Guarantor or any holder of Senior Indebtedness of Note Guarantor or any other
creditor of a Note Guarantor.
ARTICLE 13
Miscellaneous
SECTION 13.01. Trust Indenture Act Controls. If and to the extent that any
provision of this Indenture limits, qualifies or conflicts with the duties
imposed by, or with another provision (an "incorporated provision") included in
this Indenture by operation of, Sections 310 to 318 of the TIA, inclusive, such
imposed duties or incorporated provision shall control.
SECTION 13.02. Notices. Any notice or communication shall be in writing and
delivered in person or mailed by first-class mail addressed as follows:
if to the Issuer or any Note Guarantor:
c/o Seagate Technology International
920 Disc Drive
P.O. Box 66360
Scotts Valley, CA. 95067
Attention of:
William L. Hudson, Senior Vice President, General
Counsel and Secretary (Telephone: (831) 439-5370;
Facsimile: (831) 438-6675) and
Glen A. Peterson, Vice President, Corporate Finance and
Treasurer (Telephone: (831) 439-2870; Facsimile: (831)
438-8931);
with a copy to
Simpson Thacher & Bartlett
245 Lexington Avenue
101
New York, New York, 10017
Attention of:
Rise Norman (Telephone (212-455-2000); Facsimile (212)
455-2502)
if to the Trustee:
The Bank of New York
101 Barclay Street, Floor 21 West
New York, NY 10286
Attention of:
Corporate Trust Trustee Administration
The Issuer or the Trustee by notice to the other may designate additional
or different addresses for subsequent notices or communications.
Any notice or communication mailed to a Holder shall be mailed, first class
mail, to the Holder at the Holder's address as it appears on the registration
books of the Registrar and shall be sufficiently given if so mailed within the
time prescribed.
Failure to mail a notice or communication to a 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, it is duly given, whether
or not the addressee receives it.
SECTION 13.03. Communication by Holders with Other Holders. Holders may
communicate pursuant to Section 312(b) of the TIA with other Holders with
respect to their rights under this Indenture or the Securities. The Issuer, the
Trustee, the Registrar and anyone else shall have the protection of Section
312(c) of the TIA.
SECTION 13.04. Certificate and Opinion as to Conditions Precedent. Upon any
request or application by the Issuer to the Trustee to take or refrain from
taking any action under this Indenture, the Issuer shall furnish to the Trustee:
(a) an Officers' Certificate in form reasonably satisfactory to the
Trustee stating that, in the opinion of the signers, all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with; and
(b) an Opinion of Counsel in form reasonably satisfactory to the
Trustee stating that, in the opinion of such counsel, all such conditions
precedent have been complied with.
102
SECTION 13.05. Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture shall include:
(a) a statement that the individual 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 individual, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with; and
(d) a statement as to whether or not, in the opinion of such
individual, such covenant or condition has been complied with.
SECTION 13.06. When Securities Disregarded. In determining whether the
Holders of the required principal amount of Securities have concurred in any
direction, waiver or consent, Securities owned by the Issuer, the Company, any
other Note Guarantor or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Issuer, the
Company or any other Note Guarantor shall be disregarded and deemed not to be
outstanding, except that, for the purpose of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities which a Trust Officer of the Trustee actually knows are so owned
shall be so disregarded. Subject to the foregoing, only Securities outstanding
at the time shall be considered in any such determination.
SECTION 13.07. Rules by Trustee, Paying Agent and Registrar. The Trustee
may make reasonable rules for action by or a meeting of Holders. The Registrar
and the Paying Agent may make reasonable rules for their functions.
SECTION 13.08. Legal Holidays. A "Legal Holiday" is a Saturday, a Sunday or
other day on which banking institutions are not required by law or regulation to
be open in the State of New York. If a payment date is a Legal Holiday, payment
shall be made on the next succeeding day that is not a Legal Holiday, and no
interest shall accrue for the intervening period. If a regular record date is a
Legal Holiday, the record date shall not be affected.
103
SECTION 13.09. GOVERNING LAW. THIS INDENTURE AND THE SECURITIES SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
SECTION 13.10. Waiver of Immunities. To the extent that the Company or any
of its Subsidiaries or any of their respective properties, assets or revenues
may have or may hereafter become entitled to, or have attributed to it, any
right of immunity, on the grounds of sovereignty or otherwise, from any legal
action, suit or proceeding, from the giving of any relief in any such legal
action, suit or proceeding, from setoff or counterclaim, from the competent
jurisdiction of any court, from service of process, from attachment upon or
prior to judgment, from attachment in aid of execution of judgment, or from
execution of judgment, or from other legal process or proceeding for the giving
of any relief or for the enforcement of any judgment, in any competent
jurisdiction in which proceedings may at any time be commenced, with respect to
its obligations, liabilities or any other matter under or arising out of or in
connection with this Indenture or the Securities and the transactions
contemplated hereby, the Issuer and each Note Guarantor hereby irrevocably and
unconditionally waives and agrees not to plead or claim, any such immunity and
consent to such relief and enforcement.
SECTION 13.11. Consent to Jurisdiction; Appointment of Agent for Service of
Process; Judgment Currency. (a) The Issuer and each of the Note Guarantors
agrees that any suit, action or proceeding against the Issuer or any Note
Guarantor arising out of or relating to this Indenture or the Securities may be
instituted in any state or U.S. Federal court in the Borough of Manhattan, The
City of New York, New York, and any appellate court from any thereof, and each
of them irrevocably submits to the non-exclusive jurisdiction of such courts in
any suit, action or proceeding. The Issuer and each of the Note Guarantors
irrevocably waives, to the fullest extent permitted by law, any objection to any
suit, action, or proceeding that may be brought in connection with this
Indenture or the Securities, including such actions, suits or proceedings
relating to securities laws of the United States of America or any state
thereof, in such courts whether on the grounds of venue, residence or domicile
or on the ground that any such suit, action or proceeding has been brought in an
inconvenient forum. The Issuer and each Note Guarantor agrees that final
judgment in any such suit, action or proceeding brought in such court shall be
conclusive and binding upon the Issuer or any Note Guarantor, as the case may
be, and may be enforced in any court to the jurisdiction of which the Issuer or
any Note Guarantor, as the case may be, is subject by a suit upon such judgment;
provided that service of process is affected upon the Issuer or any Note
Guarantor, as the case may be, in the manner provided by this Section 13.11.
(b) The Issuer and each Note Guarantor organized under the laws of any
jurisdiction other than the United Sates, any state thereof or the District of
Columbia irrevocably appoints CT Corporation System Inc., with offices on the
date hereof at 111 Eighth Avenue, 13th Floor, New York, New York 10011, as its
authorized agent (the
104
"Authorized Agent"), upon whom process may be served in any suit, action or
proceeding arising out of or relating to this Indenture of the Securities or the
transactions contemplated herein which may be instituted in any state or U.S.
Federal court in the Borough of Manhattan, The City of New York, New York, and
expressly accepts the non-exclusive jurisdiction of any such court in respect of
any such suit, action or proceeding. The Issuer and each Note Guarantor hereby
represents and warrants that the Authorized Agent has accepted such appointment
and has agreed to act as said agent for service of process, and the Issuer and
the Note Guarantors agree to take any and all action, including the filing of
any and all documents that may be necessary to continue such respective
appointment in full force and effect for a period of seven years from the date
of this Indenture. Service of process upon the Authorized Agent shall be deemed,
in every respect, effective service of process upon the Issuer and the Note
Guarantors. Notwithstanding the foregoing, any action involving the Issuer or
any Note Guarantor arising out of or relating to this Indenture or the
Securities may be instituted in any court of competent jurisdiction in any other
jurisdiction.
(c) Each of the parties to this Indenture hereby irrevocably waives all
right to a trial by jury in any action, proceeding or counterclaim arising out
of or relating to the Securities, this Indenture, any Note Guarantee or the
transactions contemplated hereby or thereby.
SECTION 13.12. No Recourse Against Others. A director, officer, employee or
stockholder, as such, of the Issuer or any of the Note Guarantors, shall not
have any liability for any obligations of the Issuer or any of the Note
Guarantors under the Securities or this Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. By accepting a
Security, each Holder shall waive and release all such liability. The waiver and
release shall be part of the consideration for the issue of the Securities.
SECTION 13.13. Successors. All agreements of the Issuer and each Note
Guarantor in this Indenture and the Securities shall bind its successors. All
agreements of the Trustee in this Indenture shall bind its successors.
SECTION 13.14. Multiple Originals. The parties may sign any number of
copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is enough to prove this
Indenture.
SECTION 13.15. Table of Contents; Headings. The table of contents,
cross-reference sheet and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or restrict any of the terms
or provisions hereof.
105
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed as of the date first written above.
SEAGATE TECHNOLOGY
INTERNATIONAL,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
NEW SAC,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE TECHNOLOGY HOLDINGS,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE TECHNOLOGY HDD
HOLDINGS,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
106
SEAGATE TECHNOLOGY CHINA
HOLDING COMPANY,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE TECHNOLOGY ASIA
HOLDINGS,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE TECHNOLOGY (IRELAND),
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE TECHNOLOGY MEDIA
(IRELAND),
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
107
SEAGATE TECHNOLOGY FAR EAST
HOLDINGS,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE TECHNOLOGY
(PHILIPPINES),
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE TECHNOLOGY SAN
HOLDINGS,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE REMOVABLE STORAGE
SOLUTIONS HOLDINGS, INC.
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
108
SEAGATE REMOVABLE STORAGE
SOLUTIONS INTERNATIONAL
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE SOFTWARE (CAYMAN)
HOLDINGS
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE TECHNOLOGY (US)
HOLDINGS, INC.
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE TECHNOLOGY LLC,
by SEAGATE TECHNOLOGY (US)
HOLDINGS, INC., as Managing
Member
by
/S/ KENNETH HAO
----------------------------------------
Name: Kenneth Hao
Title: Vice President
109
SEAGATE US LLC,
by SEAGATE TECHNOLOGY LLC,
as Sole Member
by SEAGATE TECHNOLOGY (US)
HOLDINGS, INC., as Managing
Member
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
REDWOOD ACQUISITION
CORPORATION,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE REMOVABLE STORAGE
SOLUTIONS (US) HOLDINGS, INC.,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
110
SEAGATE REMOVABLE STORAGE
SOLUTIONS LLC,
by SEAGATE REMOVABLE
STORAGE SOLUTIONS (US)
HOLDINGS, INC., as Sole Member
by
/S/ KENNETH HAO
----------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE RSS LLC,
by SEAGATE REMOVABLE
STORAGE SOLUTIONS LLC, as
Sole Member
by SEAGATE REMOVABLE
STORAGE SOLUTIONS (US)
HOLDINGS, INC., as Sole Member
by
/S/ KENNETH HAO
----------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE SOFTWARE INFORMATION
MANAGEMENT GROUP HOLDINGS,
INC.,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
111
QUINTA CORPORATION,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
XIOTECH CORPORATION,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE TECHNOLOGY (THAILAND)
LIMITED,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE TECHNOLOGY-REYNOSA
S. DE R.L. DE C.V.,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
112
NIPPON SEAGATE INC.,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
NIPPON SEAGATE SOFTWARE, INC.,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE SINGAPORE DISTRIBUTION
PTE LTD,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE SOFTWARE INFORMATION
PTE LTD,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
113
SEAGATE DISTRIBUTION (UK)
LIMITED,
by:
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
Witnessed by /s/ Laura Moss
-----------------------------------
Name: Laura Moss
Address: 320 Park Avenue
NY, NY 10022
SEAGATE TECHNOLOGY (MARLOW)
LIMITED,
by:
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
SEAGATE SOFTWARE INFORMATION
MANAGEMENT GROUP LIMITED,
by:
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
XIOTECH (CANADA) LTD,
by:
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
114
SEAGATE SOFTWARE (CANADA), INC.,
by
/S/ KENNETH HAO
--------------------------------------------
Name: Kenneth Hao
Title: Vice President
THE BANK OF NEW YORK, as Trustee
by
/S/ VAN K. BROWN
--------------------------------------------
Name: Van K. Brown
Title: Vice President
115
APPENDIX A
PROVISIONS RELATING TO ORIGINAL SECURITIES,
ADDITIONAL SECURITIES, PRIVATE EXCHANGE SECURITIES
AND EXCHANGE SECURITIES
1. Definitions
1.1 Definitions
For the purposes of this Appendix A the following terms shall have the
meanings indicated below:
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Regulation S Global Security or beneficial interest
therein, the rules and procedures of the Depositary for such Global Security,
Euroclear and Clearstream, in each case to the extent applicable to such
transaction and as in effect from time to time.
"Clearstream" means Clearstream Banking, societe anonyme, or any
successor securities clearing agency.
"Definitive Security" means a certificated Initial Security, Private
Exchange Security or Exchange Security (bearing the Restricted Securities Legend
if the transfer of such Security is restricted by applicable law) that does not
include the Global Securities Legend.
"Depositary" means The Depository Trust Company, its nominees and their
respective successors.
"Euroclear" means the Euroclear Clearance System or any successor
securities clearing agency.
"Global Securities Legend" means the legend set forth under that
caption in Exhibit A to this Indenture.
"IAI" means an institutional "accredited investor" as described in Rule
501(a)(1), (2), (3) or (7) under the Securities Act.
"Initial Purchasers" means Chase Securities Inc., Goldman, Sachs & Co.
and Merrill Lynch, Pierce, Fenner & Smith Incorporated.
"Private Exchange" means an offer by the Issuer, pursuant to a
Registration Agreement, to issue and deliver to certain purchasers, in exchange
for the Initial Securities held by such purchasers as part of their initial
distribution, a like aggregate principal amount of Private Exchange Securities.
"Private Exchange Securities" means the Securities of the Issuer issued
in exchange for Initial Securities pursuant to this Indenture in connection with
a Private Exchange pursuant to a Registration Agreement.
"Purchase Agreement" means (a) the Purchase Agreement dated November
17, 2000, among the Issuer, the Note Guarantors and the Initial Purchasers and
(b) any other similar Purchase Agreement relating to Additional Securities.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Registered Exchange Offer" means the offer by the Issuer, pursuant to
a Registration Agreement, to certain Holders of Initial Securities, to issue and
deliver to such Holders, in exchange for their Initial Securities, a like
aggregate principal amount of Exchange Securities registered under the
Securities Act.
"Registration Agreement" means (a) the Exchange and Registration Rights
Agreement dated November 22, 2000, among the Issuer, the Note Guarantors and the
Initial Purchasers and (b) any other similar Exchange and Registration Rights
Agreement relating to Additional Securities.
"Regulation S" means Regulation S under the Securities Act.
"Regulation S Securities" means all Initial Securities offered and sold
outside the United States in reliance on Regulation S.
"Restricted Period", with respect to any Securities, means the period
of 40 consecutive days beginning on and including the later of (a) the day on
which such Securities are first offered to persons other than distributors (as
defined in Regulation S under the Securities Act) in reliance on Regulation S,
notice of which day shall be promptly given by the Issuer to the Trustee, and
(b) the Issue Date with respect to such Securities.
"Restricted Securities Legend" means the legend set forth in Section
2.3(e)(i) herein.
"Rule 501" means Rule 501(a)(1), (2), (3) or (7) under the Securities
Act.
"Rule 144A" means Rule 144A under the Securities Act.
"Rule 144A Securities" means all Initial Securities offered and sold to
QIBs in reliance on Rule 144A.
"Securities Act" means the Securities Act of 1933, as amended.
2
"Securities Custodian" means the custodian with respect to a Global
Security (as appointed by the Depositary) or any successor person thereto, who
shall initially be the Trustee.
"Shelf Registration Statement" means a registration statement filed by
the Issuer in connection with the offer and sale of Initial Securities pursuant
to the Registration Agreement.
"Transfer Restricted Securities" means Definitive Securities and any
other Securities that bear or are required to bear the Restricted Securities
Legend.
1.2 Other Definitions
Term: Defined in Section:
---- ------------------
"Agent Members".........................................................2.1(c)
"IAI Global Security"...................................................2.1(b)
"Global Security".......................................................2.1(b)
"Regulation S Global Security"..........................................2.1(b)
"Rule 144A Global Security".............................................2.1(b)
Terms not otherwise defined herein shall have the meaning assigned to
such terms in this Indenture.
2. The Securities
2.1 Form and Dating
(a) The Initial Securities issued on the date hereof will be (i)
offered and sold by the Issuer pursuant to a Purchase Agreement and (ii) resold,
initially only to (1) QIBs in reliance on Rule 144A and (2) Persons other than
U.S. Persons (as defined in Regulation S) in reliance on Regulation S. Such
Initial Securities may thereafter be transferred to, among others, QIBs,
purchasers in reliance on Regulation S and, except as set forth below, IAIs in
accordance with Rule 501. Additional Securities offered after the date hereof
may be offered and sold by the Issuer from time to time pursuant to one or more
Purchase Agreements in accordance with applicable law.
(b) Global Securities. Rule 144A Securities shall be issued initially
in the form of one or more permanent global Securities in definitive, fully
registered form (collectively, the "Rule 144A Global Security") and Regulation S
Securities shall be issued initially in the form of one or more global permanent
Securities (collectively, the "Regulation S Global Security"), in each case
without interest coupons and bearing the Global Securities Legend and Restricted
Securities Legend, which shall be deposited on behalf of the
3
purchasers of the Securities represented thereby with the Securities Custodian,
and registered in the name of the Depositary or a nominee of the Depositary,
duly executed by the Issuer and authenticated by the Trustee as provided in this
Indenture. One or more global securities in definitive, fully registered form
without interest coupons and bearing the Global Securities Legend and the
Restricted Securities Legend (collectively, the "IAI Global Security") shall
also be issued on the Closing Date, deposited with the Securities Custodian, and
registered in the name of the Depositary or a nominee of the Depositary, duly
executed by the Issuer and authenticated by the Trustee as provided in this
Indenture to accommodate transfers of beneficial interests in the Securities to
IAIs subsequent to the initial distribution. Beneficial ownership interests in
the Regulation S Global Security shall not be exchangeable for interests in the
Rule 144A Global Security, the IAI Global Security or any other Security without
a Restricted Securities Legend until the expiration of the Restricted Period.
The Rule 144A Global Security, the IAI Global Security and the Regulation S
Global Security are each referred to herein as a "Global Security" and are
collectively referred to herein as "Global Securities", provided, that the term
"Global Security" when used in Sections 2.1(b) (third paragraph), 2.1(e),
2.3(g)(i), 2.3(h)(i) and 2.4 shall also include any Security in global form
issued in connection with a Registered Exchange Offer or Private Exchange. The
aggregate principal amount of the Global Securities may from time to time be
increased or decreased by adjustments made on the records of the Trustee and the
Depositary or its nominee as hereinafter provided.
(c) Book-Entry Provisions. This Section 2.1(c) shall apply only to a
Global Security deposited with or on behalf of the Depositary.
The Issuer shall execute and the Trustee shall, in accordance with this
Section 2.1(c) and Section 2.2 and pursuant to an order of the Issuer,
authenticate and deliver initially one or more Global Securities that (i) shall
be registered in the name of the Depositary for such Global Security or Global
Securities or the nominee of such Depositary and (ii) shall be delivered by the
Trustee to such Depositary or pursuant to such Depositary's instructions or held
by the Trustee as Securities Custodian.
Members of, or participants in, the Depositary ("Agent Members") shall
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depositary or by the Trustee as Securities Custodian or
under such Global Security, and the Depositary may be treated by the Issuer, the
Note Guarantors, the Trustee and any agent of the Issuer, the Note Guarantors or
the Trustee as the absolute owner of such Global Security for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Issuer, the Note Guarantors, the Trustee or any agent of the Issuer, the Note
Guarantors or the Trustee from giving effect to any written certification, proxy
or other authorization furnished by the Depositary or impair, as between the
Depositary and its Agent Members, the operation of customary practices of such
Depositary governing the exercise of the rights of a holder of a beneficial
interest in any Global Security.
4
(d) Definitive Securities. Except as provided in Section 2.3 or 2.4,
owners of beneficial interests in Global Securities shall not be entitled to
receive physical delivery of certificated Securities.
2.2 Authentication. The Trustee shall authenticate and make available for
delivery upon a written order of the Issuer signed by two Officers (a) Original
Securities for original issue on the date hereof in an aggregate principal
amount of $210,000,000, (b) subject to the terms of this Indenture, Additional
Securities and (3) the (i) Exchange Securities for issue only in a Registered
Exchange Offer and (ii) Private Exchange Securities for issue only in a Private
Exchange, in the case of each of (i) and (ii) pursuant to a Registration
Agreement and for a like principal amount of Initial Securities exchanged
pursuant thereto. Such order shall specify the amount of the Securities to be
authenticated, the date on which the original issue of Securities is to be
authenticated and whether the Securities are to be Initial Securities, Exchange
Securities or Private Exchange Securities.
2.3 Transfer and Exchange. (a) Transfer and Exchange of Definitive
Securities. When Definitive Securities are presented to the Registrar with a
request:
(i) to register the transfer of such Definitive Securities; or
(ii) to exchange such Definitive Securities for an equal principal
amount of Definitive Securities of other authorized denominations,
the Registrar shall register the transfer or make the exchange as requested if
its reasonable requirements for such transaction are met; provided, however,
that the Definitive Securities surrendered for transfer or exchange:
(1) shall be duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Issuer and the Registrar,
duly executed by the Holder thereof or his attorney duly authorized in
writing; and
(2) in the case of Transfer Restricted Securities, are accompanied by
the following additional information and documents, as applicable:
(A) if such Definitive Securities are being delivered to the
Registrar by a Holder for registration in the name of such Holder,
without transfer, a certification from such Holder to that effect (in
the form set forth on the reverse side of the Initial Security); or
(B) if such Definitive Securities are being transferred to the
Issuer, a certification to that effect (in the form set forth on the
reverse side of the Initial Security); or
5
(C) if such Definitive Securities are being transferred pursuant
to an exemption from registration in accordance with Rule 144 under
the Securities Act or in reliance upon another exemption from the
registration requirements of the Securities Act, (x) a certification
to that effect (in the form set forth on the reverse side of the
Initial Security) and (y) if the Issuer so requests, an opinion of
counsel or other evidence reasonably satisfactory to it as to the
compliance with the restrictions set forth in the legend set forth in
Section 2.3(e)(i).
(b) Restrictions on Transfer of a Definitive Security for a Beneficial
Interest in a Global Security. A Definitive Security may not be exchanged for a
beneficial interest in a Global Security except upon satisfaction of the
requirements set forth below. Upon receipt by the Trustee of a Definitive
Security, duly endorsed or accompanied by a written instrument of transfer in
form reasonably satisfactory to the Issuer and the Registrar, together with:
(i) certification (in the form set forth on the reverse side of the
Initial Security) that such Definitive Security is being transferred (1) to
a QIB in accordance with Rule 144A, (2) to an IAI that has furnished to the
Trustee a signed letter substantially in the form of Exhibit D or (3)
outside the United States in an offshore transaction within the meaning of
Regulation S and in compliance with Rule 904 under the Securities Act; and
(ii) written instructions directing the Trustee to make, or to direct
the Securities Custodian to make, an adjustment on its books and records
with respect to such Global Security to reflect an increase in the
aggregate principal amount of the Securities represented by the Global
Security, such instructions to contain information regarding the Depositary
account to be credited with such increase, then the Trustee shall cancel
such Definitive Security and cause, or direct the Securities Custodian to
cause, in accordance with the standing instructions and procedures existing
between the Depositary and the Securities Custodian, the aggregate
principal amount of Securities represented by the Global Security to be
increased by the aggregate principal amount of the Definitive Security to
be exchanged and shall credit or cause to be credited to the account of the
Person specified in such instructions a beneficial interest in the Global
Security equal to the principal amount of the Definitive Security so
canceled. If no Global Securities are then outstanding and the Global
Security has not been previously exchanged for certificated securities
pursuant to Section 2.4, the Issuer shall issue and the Trustee shall
authenticate, upon written order of the Issuer in the form of an Officers'
Certificate, a new Global Security in the appropriate principal amount.
(c) Transfer and Exchange of Global Securities. (i) The transfer and
exchange of Global Securities or beneficial interests therein shall be effected
through the
6
Depositary, in accordance with this Indenture (including applicable restrictions
on transfer set forth herein, if any) and the procedures of the Depositary
therefor. A transferor of a beneficial interest in a Global Security shall
deliver a written order given in accordance with the Depositary's procedures
containing information regarding the participant account of the Depositary to be
credited with a beneficial interest in such Global Security or another Global
Security and such account shall be credited in accordance with such order with a
beneficial interest in the applicable Global Security and the account of the
Person making the transfer shall be debited by an amount equal to the beneficial
interest in the Global Security being transferred. Transfers by an owner of a
beneficial interest in the Rule 144A Global Security or the IAI Global Security
to a transferee who takes delivery of such interest through the Regulation S
Global Security, whether before or after the expiration of the Restricted
Period, shall be made only upon receipt by the Trustee of a certification in the
form provided on the reverse of the Initial Securities from the transferor to
the effect that such transfer is being made in accordance with Regulation S or
(if available) Rule 144 under the Securities Act and that, if such transfer is
being made prior to the expiration of the Restricted Period, the interest
transferred shall be held immediately thereafter through Euroclear or
Clearstream. In the case of a transfer of a beneficial interest in either the
Regulation S Global Security or the Rule 144A Global Security for an interest in
the IAI Global Security, the transferee must furnish a signed letter
substantially in the form of Exhibit D to the Trustee.
(ii) If the proposed transfer is a transfer of a beneficial interest
in one Global Security to a beneficial interest in another Global Security,
the Registrar shall reflect on its books and records the date and an
increase in the principal amount of the Global Security to which such
interest is being transferred in an amount equal to the principal amount of
the interest to be so transferred, and the Registrar shall reflect on its
books and records the date and a corresponding decrease in the principal
amount of Global Security from which such interest is being transferred.
(iii) Notwithstanding any other provisions of this Appendix (other
than the provisions set forth in Section 2.4), a Global Security may not be
transferred as a whole except by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.
(iv) In the event that a Global Security is exchanged for Definitive
Securities pursuant to Section 2.4 prior to the consummation of a
Registered Exchange Offer or the effectiveness of a Shelf Registration
Statement with respect to such Securities, such Securities may be exchanged
only in accordance with such procedures as are substantially consistent
with the provisions of this Section 2.3 (including the certification
requirements set forth on the reverse of the Initial Securities intended to
ensure that such transfers comply with Rule 144A, Regulation S or such
other
7
applicable exemption from registration under the Securities Act, as the
case may be) and such other procedures as may from time to time be adopted
by the Issuer.
(d) Restrictions on Transfer of Regulation S Global Security. (i) Prior
to the expiration of the Restricted Period, interests in the Regulation S Global
Security may only be held through Euroclear or Clearstream. During the
Restricted Period, beneficial ownership interests in the Regulation S Global
Security may only be sold, pledged or transferred through Euroclear or
Clearstream in accordance with the Applicable Procedures and only (1) to the
Issuer, (2) so long as such security is eligible for resale pursuant to Rule
144A, to a person whom the selling holder reasonably believes is a QIB that
purchases for its own account or for the account of a QIB to whom notice is
given that the resale, pledge or transfer is being made in reliance on Rule
144A, (3) in an offshore transaction in accordance with Regulation S, (4)
pursuant to an exemption from registration under the Securities Act provided by
Rule 144 (if applicable) under the Securities Act, (5) to an IAI purchasing for
its own account, or for the account of such an IAI, in a minimum principal
amount of Securities of $250,000 or (6) pursuant to an effective registration
statement under the Securities Act, in each case in accordance with any
applicable securities laws of any state of the United States. Prior to the
expiration of the Restricted Period, transfers by an owner of a beneficial
interest in the Regulation S Global Security to a transferee who takes delivery
of such interest through the Rule 144A Global Security or the IAI Global
Security shall be made only in accordance with Applicable Procedures and upon
receipt by the Trustee of a written certification from the transferor of the
beneficial interest in the form provided on the reverse of the Initial Security
to the effect that such transfer is being made to (1) a person whom the
transferor reasonably believes is a QIB within the meaning of Rule 144A in a
transaction meeting the requirements of Rule 144A or (2) an IAI purchasing for
its own account, or for the account of such an IAI, in a minimum principal
amount of the Securities of $250,000. Such written certification shall no longer
be required after the expiration of the Restricted Period. In the case of a
transfer of a beneficial interest in the Regulation S Global Security for an
interest in the IAI Global Security, the transferee must furnish a signed letter
substantially in the form of Exhibit D to the Trustee.
(ii) Upon the expiration of the Restricted Period, beneficial
ownership interests in the Regulation S Global Security shall be
transferable in accordance with applicable law and the other terms of this
Indenture.
(e) Legend.
(i) Except as permitted by the following paragraphs (ii), (iii) or
(iv), each Security certificate evidencing the Global Securities and the
Definitive Securities (and all Securities issued in exchange therefor or in
substitution thereof) shall bear a
8
legend in substantially the following form (each defined term in the legend
being defined as such for purposes of the legend only):
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED
OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL
OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUER OR ANY
AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR
OF SUCH SECURITY), ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION
STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C)
FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A
UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES
IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER
TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES
WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7)
UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR
ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL
AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES AND NOT WITH
A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN
VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANY OTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT
TO THE ISSUER'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F)
9
TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR
OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED
UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION
DATE."
Each Definitive Security shall bear the following additional legend:
"IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR
AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER
AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE
FOREGOING RESTRICTIONS."
(ii) Upon any sale or transfer of a Transfer Restricted Security that
is a Definitive Security, the Registrar shall permit the Holder thereof to
exchange such Transfer Restricted Security for a Definitive Security that
does not bear the legends set forth above and rescind any restriction on
the transfer of such Transfer Restricted Security if the Holder certifies
in writing to the Registrar that its request for such exchange was made in
reliance on Rule 144 (such certification to be in the form set forth on the
reverse of the Initial Security).
(iii) After a transfer of any Original or Additional Securities or
Private Exchange Securities during the period of the effectiveness of a
Shelf Registration Statement with respect to such Original or Additional
Securities or Private Exchange Securities, as the case may be, all
requirements pertaining to the Restricted Securities Legend on such
Original or Additional Securities or such Private Exchange Securities shall
cease to apply and the requirements that any such Original or Additional
Securities or such Private Exchange Securities be issued in global form
shall continue to apply.
(iv) Upon the consummation of a Registered Exchange Offer with respect
to the Original or Additional Securities pursuant to which Holders of such
Original or Additional Securities are offered Exchange Securities in
exchange for their Original or Additional Securities, all requirements
pertaining to Original or Additional Securities that Original or Additional
Securities be issued in global form shall continue to apply, and Exchange
Securities in global form without the Restricted Securities Legend shall be
available to Holders that exchange such Securities in such Registered
Exchange Offer.
(v) Upon the consummation of a Private Exchange with respect to the
Original or Additional Securities pursuant to which Holders of such
Original or Additional Securities are offered Private Exchange Securities
in exchange for their
10
Original or Additional Securities, all requirements pertaining to such
Original or Additional Securities that Original or Additional Securities be
issued in global form shall continue to apply, and Private Exchange
Securities in global form with the Restricted Securities Legend shall be
available to Holders that exchange such Original or Additional Securities
in such Private Exchange.
(vi) Upon a sale or transfer after the expiration of the Restricted
Period of any Initial Security acquired pursuant to Regulation S, all
requirements that such Initial Security bear the Restricted Securities
Legend shall cease to apply and the requirements requiring any such Initial
Security be issued in global form shall continue to apply.
(vii) Any Additional Securities sold in a registered offering shall
not be required to bear the Restricted Securities Legend.
(f) Cancelation or Adjustment of Global Security. At such time as all
beneficial interests in a Global Security have either been exchanged for
Definitive Securities, transferred, redeemed, repurchased or canceled, such
Global Security shall be returned by the Depositary to the Trustee for
cancelation or retained and canceled by the Trustee. At any time prior to such
cancelation, if any beneficial interest in a Global Security is exchanged for
Definitive Securities, transferred in exchange for an interest in another Global
Security, redeemed, repurchased or canceled, the principal amount of Securities
represented by such Global Security shall be reduced and an adjustment shall be
made on the books and records of the Trustee (if it is then the Securities
Custodian for such Global Security) with respect to such Global Security, by the
Trustee or the Securities Custodian, to reflect such reduction.
(g) Obligations with Respect to Transfers and Exchanges of Securities.
(i) To permit registrations of transfers and exchanges, the Issuer
shall execute and the Trustee shall authenticate, Definitive Securities and
Global Securities at the Registrar's request.
(ii) No service charge shall be made for any registration of transfer
or exchange, but the Issuer may require payment of a sum sufficient to
cover any transfer tax, assessments, or similar governmental charge payable
in connection therewith (other than any such transfer taxes, assessments or
similar governmental charge payable upon exchanges pursuant to Sections
2.07, 3.06, 4.06, 4.08 and 9.05 of this Indenture).
(iii) Prior to the due presentation for registration of transfer of
any Security, the Issuer, the Trustee, the Paying Agent or the Registrar
may deem and treat the person in whose name a Security is registered as the
absolute owner of such Security for the purpose of receiving payment of
principal of and interest on such Security and
11
for all other purposes whatsoever, whether or not such Security is overdue,
and none of the Issuer, the Trustee, the Paying Agent or the Registrar
shall be affected by notice to the contrary.
(iv) All Securities issued upon any transfer or exchange pursuant to
the terms of this Indenture shall evidence the same debt and shall be
entitled to the same benefits under this Indenture as the Securities
surrendered upon such transfer or exchange.
(h) No Obligation of the Trustee.
(i) The Trustee shall have no responsibility or obligation to any
beneficial owner of a Global Security, a member of, or a participant in the
Depositary or any other Person with respect to the accuracy of the records
of the Depositary or its nominee or of any participant or member thereof,
with respect to any ownership interest in the Securities or with respect to
the delivery to any participant, member, beneficial owner or other Person
(other than the Depositary) of any notice (including any notice of
redemption or repurchase) or the payment of any amount, under or with
respect to such Securities. All notices and communications to be given to
the Holders and all payments to be made to Holders under the Securities
shall be given or made only to the registered Holders (which shall be the
Depositary or its nominee in the case of a Global Security). The rights of
beneficial owners in any Global Security shall be exercised only through
the Depositary subject to the applicable rules and procedures of the
Depositary. The Trustee may rely and shall be fully protected in relying
upon information furnished by the Depositary with respect to its members,
participants and any beneficial owners.
(ii) The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer
imposed under this Indenture or under applicable law with respect to any
transfer of any interest in any Security (including any transfers between
or among Depositary participants, members or beneficial owners in any
Global Security) other than to require delivery of such certificates and
other documentation or evidence as are expressly required by, and to do so
if and when expressly required by, the terms of this Indenture, and to
examine the same to determine substantial compliance as to form with the
express requirements hereof.
2.4 Definitive Securities
(a) A Global Security deposited with the Depositary or with the Trustee
as Securities Custodian pursuant to Section 2.1 or issued in connection with a
Registered Exchange Offer or Private Exchange shall be transferred to the
beneficial owners thereof in the form of Definitive Securities in an aggregate
principal amount equal to the principal
12
amount of such Global Security, in exchange for such Global Security, only if
such transfer complies with Section 2.3 and (i) the Depositary notifies the
Issuer that it is unwilling or unable to continue as a Depositary for such
Global Security or if at any time the Depositary ceases to be a "clearing
agency" registered under the Exchange Act, and a successor depositary is not
appointed by the Issuer within 90 days of such notice or after the Issuer
becomes aware of such cessation, or (ii) an Event of Default has occurred and is
continuing or (iii) the Issuer, in its sole discretion, notifies the Trustee in
writing that it elects to cause the issuance of certificated Securities under
this Indenture.
(b) Any Global Security that is transferable to the beneficial owners
thereof pursuant to this Section 2.4 shall be surrendered by the Depositary to
the Trustee, to be so transferred, in whole or from time to time in part,
without charge, and the Trustee shall authenticate and deliver, upon such
transfer of each portion of such Global Security, an equal aggregate principal
amount of Definitive Securities of authorized denominations. Any portion of a
Global Security transferred pursuant to this Section shall be executed,
authenticated and delivered only in denominations of $1,000 and any integral
multiple thereof and registered in such names as the Depositary shall direct.
Any certificated Initial Security in the form of a Definitive Security delivered
in exchange for an interest in the Global Security shall, except as otherwise
provided by Section 2.3(e), bear the Restricted Securities Legend.
(c) Subject to the provisions of Section 2.4(b), the registered Holder
of a Global Security may grant proxies and otherwise authorize any Person,
including Agent Members and Persons that may hold interests through Agent
Members, to take any action which a Holder is entitled to take under this
Indenture or the Securities.
(d) In the event of the occurrence of any of the events specified in
Section 2.4(a)(i), (ii) or (iii), the Issuer will promptly make available to the
Trustee a reasonable supply of Definitive Securities in fully registered form
without interest coupons.
13
SCHEDULE I
Note Guarantors
Name Jurisdiction of Organization
- ---- ----------------------------
New SAC Cayman Islands
Seagate Technology Holdings Cayman Islands
Seagate Technology HDD Holdings Cayman Islands
Seagate Technology China Holding Company Cayman Islands
Seagate Technology Asia Holdings Cayman Islands
Seagate Technology (Ireland) Cayman Islands/
Located in Northern Ireland
Seagate Technology Media (Ireland) Cayman Islands/
Located in Northern Ireland
Seagate Technology Far East Holdings Cayman Islands
Seagate Technology (Philippines) Cayman Islands
Seagate Technology SAN Holdings Cayman Islands
Seagate Removable Storage Solutions Holdings Cayman Islands
Seagate Removable Storage Solutions International Cayman Islands
Seagate Software (Cayman) Holdings Cayman Islands
Seagate Technology (US) Holdings, Inc. Delaware
Seagate Technology LLC Delaware
Seagate US LLC Delaware
Redwood Acquisition Corporation Delaware
Seagate Removable Storage Solutions (US) Holdings, Inc. Delaware
Seagate Removable Storage Solutions LLC Delaware
Seagate RSS LLC Delaware
Seagate Software Information Management Group Delaware
Holdings, Inc.
Name Jurisdiction of Organization
- ---- ----------------------------
Quinta Corporation California
XIOtech Corporation Minnesota
Seagate Technology (Thailand) Limited Thailand
Seagate Technology-Reynosa, S. de R.L. de C.V. Mexico
Nippon Seagate Inc. Japan
Nippon Seagate Software, Inc. Japan
Seagate Singapore Distribution Pte Ltd Singapore
Seagate Software Information Pte Ltd Singapore
Seagate Distribution (UK) Limited Scotland
Seagate Technology (Marlow) Limited England & Wales
Seagate Software Information Management Group Limited England & Wales
XIOtech (Canada) Limited Canada
Seagate Software(Canada), Inc. Canada
2
EXHIBIT A
[FORM OF FACE OF INITIAL SECURITY]
[Global Securities Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, 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
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL
BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Restricted Securities Legend]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY
BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUER OR ANY
AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF
SUCH SECURITY), ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT
THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE
144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES
IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D)
PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN "ACCREDITED
INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE
SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF THE
SECURITIES OF $250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR
OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES
ACT OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER'S AND THE TRUSTEE'S
RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR
(F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE
REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
Each Definitive Security shall bear the following additional legend:
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT
MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.
2
No. $__________
12 1/2% Senior Subordinated Note due 2007
CUSIP No. ______
ISIN No.____
SEAGATE TECHNOLOGY INTERNATIONAL, an exempted limited liability company
incorporated under the laws of the Cayman Islands, promises to pay to Cede &
Co., or registered assigns, the principal sum [of Dollars] [listed on the
Schedule of Increases or Decreases in Global Security attached hereto] on
November 15, 2007.
Interest Payment Dates: May 15 and November 15.
Record Dates: May 1 and November 1.
Additional provisions of this Security are set forth on the other side
of this Security.
IN WITNESS WHEREOF, the parties have caused this instrument to be duly
executed.
SEAGATE TECHNOLOGY
INTERNATIONAL,
by
----------------------------------------
Name:
Title:
Dated:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
THE BANK OF NEW YORK
as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.
By:
---------------------------------
Authorized Signatory
*/ If the Security is to be issued in global form, add the Global Securities
Legend and the attachment from Exhibit A captioned "TO BE ATTACHED TO
GLOBAL SECURITIES--SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY".
2
[FORM OF REVERSE SIDE OF INITIAL SECURITY]
12 1/2% Senior Subordinated Note due 2007
1. Interest
(a) SEAGATE TECHNOLOGY INTERNATIONAL, an exempted limited liability
company incorporated under the laws of the Cayman Islands (such corporation, and
its successors and assigns under the Indenture hereinafter referred to, being
herein called the "Issuer"), promises to pay interest on the principal amount of
this Security at the rate per annum shown above. The Issuer shall pay interest
semiannually on May 15 and November 15 of each year. Interest on the Securities
shall accrue from the most recent date to which interest has been paid or duly
provided for or, if no interest has been paid or duly provided for, from
November 22, 2000 until the principal hereof is due. Interest shall be computed
on the basis of a 360-day year of twelve 30-day months.
(b) Liquidated Damages. The Holder of this Security is entitled to the
benefits of an Exchange and Registration Rights Agreement, dated as of November
22, 2000, among the Issuer, New SAC, Seagate Technology Holdings, Seagate
Technology HDD Holdings, Seagate Technology (US) Holdings, Inc., Seagate
Technology LLC, Seagate US LLC, Redwood Acquisition Corporation, Quinta
Corporation, Seagate Technology International, Seagate Technology (Thailand)
Limited, Seagate Technology China Holding Co., Seagate Technology Asia Holdings,
Seagate Technology (Ireland), Seagate Technology Media (Ireland), Seagate
Technology Reynosa S. de R.L. de C.V., Nippon Seagate Inc., Seagate Singapore
Distribution Pte Ltd, Seagate Distribution (UK) Limited, Seagate Technology
(Marlow) Limited, Seagate Technology Far East Holdings, Seagate Technology
(Philippines), Seagate Technology (SAN) Holdings, XIOtech Corporation, XIOtech
(Canada) Ltd., Seagate Removable Storage Solutions Holdings, Seagate Removable
Storage Solutions (US) Holdings, Inc., Seagate Removable Storage Solutions LLC,
Seagate RSS LLC, Seagate Removable Storage Solutions International, Seagate
Software (Cayman) Holdings, Seagate Software Information Management Group
Holdings, Inc., Seagate Software Information Management Group (Canada), Inc.,
Nippon Seagate Software KK, Seagate Software Information Pte Ltd, Seagate
Software Information Management Group Limited, (collectively, the "Note
Guarantors") and the Initial Purchasers named therein (the "Registration
Agreement"). Capitalized terms used in this paragraph (b) but not defined herein
have the meanings assigned to them in the Registration Agreement. If (i) the
Shelf Registration Statement or Exchange Offer Registration Statement, as
applicable under the Registration Agreement, is not filed with the SEC on or
prior to 150 days after the Issue Date, (ii) the Exchange Offer Registration
Statement or the Shelf Registration Statement, as the case may be, is not
declared effective within 270 days after the Issue Date (or in the case of a
Shelf Registration Statement required to be filed in response to a change in law
or the applicable interpretations of the SEC's staff, if later, within 60 days
after publication of the
3
change in law or interpretation), (iii) the Registered Exchange Offer is not
consummated on or prior to 300 days after the Issue Date, other than in the
event that the Issuer and the Note Guarantors file a Shelf Registration
Statement, or (iv) the Shelf Registration Statement is filed and declared
effective within 270 days after the Issue Date (or in the case of a Shelf
Registration Statement required to be filed in response to a change in law or
the applicable interpretations of the SEC's staff, if later, within 60 days
after publication of the change in law or interpretation, but in no event within
270 days after the Issue Date) but shall thereafter cease to be effective (other
than at any time that the Issuer and the Note Guarantors are not obligated to
maintain the effectiveness thereof including as set forth in Sections 2(c) and
3(b) of the Registration Agreement) without being succeeded within 60 days by an
additional Registration Statement filed and declared effective (each such event
referred to in clauses (i) through (iv), a "Registration Default"), the Issuer
shall pay liquidated damages to each Holder of Transfer Restricted Securities,
during the period of such Registration Default, in an amount equal to $0.192 per
week per $1,000 principal amount of the Securities constituting Transfer
Restricted Securities held by such Holder until the applicable Registration
Statement is filed or declared effective, the Registered Exchange Offer is
consummated or the Shelf Registration Statement again becomes effective, as the
case may be. All accrued liquidated damages shall be paid to Holders in the same
manner as interest payments on the Securities on semi-annual payment dates which
correspond to interest payment dates for the Securities. Following the cure of
all Registration Defaults, the accrual of liquidated damages shall cease. The
Trustee shall have no responsibility with respect to the determination of the
amount of any such liquidated damages. For purposes of the foregoing, "Transfer
Restricted Securities" means (i) each Initial Security until the date on which
such Initial Security has been exchanged for a freely transferable Exchange
Security in the Registered Exchange Offer, (ii) each Initial Security or Private
Exchange Security until the date on which such Initial Security or Private
Exchange Security has been effectively registered under the Securities Act and
disposed of in accordance with a Shelf Registration Statement or (iii) each
Initial Security or Private Exchange Security until the date on which such
Initial Security or Private Exchange Security is distributed to the public
pursuant to Rule 144 under the Securities Act or is saleable pursuant to Rule
144(k) under the Securities Act. Notwithstanding anything to the contrary in
this Section 1(b) or Section 3(b) of the Registration Agreement, the Issuer and
the Note Guarantors shall not be required to pay liquidated damages to a Holder
of Transfer Restricted Securities if such Holder failed to comply with its
obligations to make the representations set forth in the second to last
paragraph of Section 1 of the Registration Agreement or failed to provide the
information required to be provided by it, if any, pursuant to Section 4(n) of
the Registration Agreement.
2. Method of Payment
The Issuer shall pay interest on the Securities (except defaulted
interest) to the Persons who are registered Holders at the close of business on
the May 1 or November 1 next preceding the interest payment date even if
Securities are canceled after the record date and on or before the interest
payment date. Holders must surrender Securities to a Paying Agent
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to collect principal payments. The Issuer shall pay principal, premium, if any,
liquidated damages, if any, and interest in money of the United States of
America that at the time of payment is legal tender for payment of public and
private debts. Payments in respect of the Securities represented by a Global
Security (including principal, premium, if any, liquidated damages, if any, and
interest) shall be made by wire transfer of immediately available funds to the
accounts specified by The Depository Trust Company or any successor depositary.
The Issuer shall make all payments in respect of a certificated Security
(including principal, premium, if any, interest and liquidated damages, if any),
at the office of the Paying Agent, except that, at the option of the Issuer,
payment of interest or liquidated damages may be made by mailing a check to the
registered address of each Holder thereof; provided, however, that payments on
the Securities may also be made, in the case of a Holder of at least $1,000,000
aggregate principal amount of Securities, by wire transfer to a U.S. dollar
account maintained by the payee with a bank in the United States if such Holder
elects payment by wire transfer by giving written notice to the Trustee or the
Paying Agent to such effect designating such account no later than 30 days
immediately preceding the relevant due date for payment (or such other date as
the Trustee may accept in its discretion).
3. Paying Agent and Registrar
Initially, The Bank of New York, a New York banking corporation (the
"Trustee"), will act as Paying Agent and Registrar. The Issuer may appoint and
change any Paying Agent or Registrar without notice. The Company or any of its
Wholly Owned Subsidiaries may act as Paying Agent or Registrar.
4. Indenture
The Issuer issued the Securities under an Indenture dated as of
November 22, 2000 (the "Indenture"), among the Issuer, the Note Guarantors and
the Trustee. The terms of the Securities include those stated in the Indenture
and those made part of the Indenture by reference to the Trust Indenture Act of
1939 (15 U.S.C. ss.ss. 77aaa-77bbbb) as in effect on the date of the Indenture
(the "TIA"). Terms defined in the Indenture and not defined herein have the
meanings ascribed thereto in the Indenture. The Securities are subject to all
terms and provisions of the Indenture, and Holders are referred to the Indenture
and the TIA for a statement of such terms and provisions.
The Securities are senior subordinated unsecured obligations of the
Issuer. This Security is one of the [Original] [Additional] [Initial] [Private
Exchange] Securities referred to in the Indenture. The Securities include the
Original Securities, the Additional Securities and any Exchange Securities and
Private Exchange Securities issued in exchange for Initial Securities pursuant
to the Indenture. The Original Securities, the Additional Securities and any
Exchange Securities and Private Exchange Securities are treated as a single
class of securities under the Indenture. The Indenture imposes certain
limitations on the ability of the Company and its Restricted Subsidiaries
(including the Issuer) to, among
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other things, make certain Investments and other Restricted Payments, pay
dividends and other distributions, incur Indebtedness, enter into consensual
restrictions upon the payment of certain dividends and distributions by such
Restricted Subsidiaries (including the Issuer), issue or sell shares of capital
stock of such Restricted Subsidiaries, enter into or permit certain transactions
with Affiliates, enter into certain lines of businesses, conduct rigid disc
drive operations at certain subsidiaries, amend Deferred Compensation Plans and
make asset sales. The Indenture also imposes limitations on the ability of the
Issuer and each Note Guarantor to consolidate or merge with or into any other
Person or convey, transfer or lease all or substantially all its property.
To guarantee the due and punctual payment of the principal of and
premium, if any, interest and liquidated damages, if any, on the Securities and
all other amounts payable by the Issuer under the Indenture and the Securities
when and as the same shall be due and payable, whether at maturity, by
acceleration or otherwise, according to the terms of the Securities and the
Indenture, the Note Guarantors have jointly and severally unconditionally
guaranteed the Guaranteed Obligations on a senior subordinated basis pursuant to
the terms of the Indenture.
5. Optional Redemption
Except as described below, the Issuer may not redeem the Securities
prior to November 15, 2004. On or after such date, the Issuer may redeem the
Securities, in whole or in part, on one or more occasions, on not less than 30
nor more than 60 days prior notice, at the following redemption prices
(expressed as percentages of principal amount), plus accrued and unpaid interest
and liquidated damages, if any, to the redemption date (subject to the right of
Holders of record on the relevant record date to receive interest and liquidated
damages, if any, due on the relevant interest payment date), if redeemed during
the 12-month period commencing on November 15 of the years set forth below:
REDEMPTION
YEAR PRICE
---------------------------------------------------
2004 106.250%
2005 103.313%
2006 and thereafter 100.000%
In addition, at any time and from time to time on or prior to November
15, 2003, the Issuer may, on one or more occasions, redeem up to a maximum of
35% of the original aggregate principal amount of the Securities (calculated
giving effect to any issuance of Additional Securities) with the Net Cash
Proceeds of one or more Equity Offerings (i) by the Issuer or (ii) by the
Company, Intermediate Holdings or HDD Holdings to the extent the Net Cash
Proceeds thereof are contributed to the Issuer or used to purchase Capital Stock
(other than Disqualified Stock) of the Issuer from the Issuer, at a redemption
price equal to
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112.5% of the principal amount thereof, plus accrued and unpaid interest and
liquidated damages thereon, if any, to the redemption date (subject to the right
of Holders of record on the relevant record date to receive interest due on the
relevant interest payment date); provided, however, that after giving effect to
any such redemption: (i) at least 65% of the original aggregate principal amount
of the Securities (calculated giving effect to any issuance of Additional
Securities) remains outstanding, and (ii) any such redemption shall be made
within 90 days of such Equity Offering upon not less than 30 nor more than 60
days notice mailed to each Holder of Securities being redeemed and otherwise in
accordance with the procedures set forth in the Indenture.
In addition, at any time on or prior to November 15, 2004, the
Securities may be redeemed as a whole but not in part at the option of the
Issuer upon the occurrence of a, or if applicable each, Change of Control, upon
not less than 30 or more than 60 days' prior notice (but in no event may any
such redemption occur more than 90 days after the occurrence of such Change of
Control) mailed by first-class mail to each Holder's registered address, at a
redemption price equal to the sum of (1) the principal amount thereof and (2)
the Applicable Premium as of, and accrued and unpaid interest, if any, to, the
redemption date (subject to the right of Holders on the relevant record date to
receive interest due on the relevant interest payment date).
6. Redemption for Changes in Withholding Taxes
(a) The Issuer, which shall include any Successor Company (as such term
is defined in Section 5.01(a)(i) of the Indenture) shall be entitled to redeem
the Securities, at its option, at any time as a whole but not in part, upon not
less than 30 nor more than 60 days' notice given as provided in Article 3 of the
Indenture, at an amount equal to 100% of the principal amount thereof, plus
accrued and unpaid interest (if any) and liquidated damages, if any, to the date
fixed for such payment (subject to the right of Holders of record on the
relevant record date to receive interest due on the relevant interest payment
date), in the event the Issuer has become or would become obligated to pay, on
the next date on which any amount would be payable with respect to the
Securities, any Additional Amounts as a result of: (1) a change in or an
amendment to the laws (including any regulations or ruling promulgated
thereunder) of (x) the Cayman Islands, (y) any jurisdiction, other than the
United States, from or through which payment on the Securities is made or (z)
any other jurisdiction, other than the United States, in which the Issuer or a
Successor Company is organized (or any political subdivision or taxing authority
thereof or therein), which change or amendment is announced or becomes effective
on or after the Closing Date (and, in the case of a Successor Company, becomes
effective after the date of that entity's assumption of the Issuer's obligations
under the Securities); or (2) any change in or amendment to any official
position regarding the application or interpretation of such laws, regulations
or rulings, or any execution of or amendment to, any treaty or treaties
affecting taxation to which such jurisdiction (or such political subdivision or
taxing authority) is a party, which change or amendment is announced or becomes
effective on or after the Closing Date; and, in the case of clauses (1) and (2)
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above, the Issuer or the Successor Company, if applicable, cannot avoid such
obligation by taking reasonable measures available to it.
(b) Prior to the notice of redemption given in accordance with the
foregoing paragraph 6(a), the Issuer or the Successor Company, if applicable,
shall deliver to the Trustee an officers' certificate to the effect that the
Issuer or the Successor Company, if applicable, cannot avoid its obligation to
pay Additional Amounts by taking reasonable measures available to it. The Issuer
or the Successor Company, if applicable, shall also deliver an opinion of
independent legal counsel of recognized standing stating that the Issuer or the
Successor Company, if applicable, would be obligated to pay Additional Amounts
as a result of a change in tax laws or regulations or the application or
interpretation of such laws or regulations.
7. Additional Amounts.
(a) The Issuer, which shall include any Successor Company (as such term
is defined in Section 5.01(a)(i) of the Indenture), shall make all its payments
under or with respect to the Securities and each Note Guarantor, which shall
include any Successor Guarantor (as such term is defined in the Indenture),
shall make all payments under or with respect to the Note Guarantees free and
clear of and without withholding or deduction for or on account of any present
or future tax, duty, levy, impost, assessment or other governmental charge
(including penalties, interest and other liabilities related thereto)
(hereinafter "Taxes") imposed or levied by or on behalf of the government of the
Cayman Islands or any political subdivision or any authority or agency therein
or thereof having power to tax, or within any other jurisdiction in which it is
organized or is otherwise resident for tax purposes or any jurisdiction from or
through which payment is made (each a "Relevant Taxing Jurisdiction"), unless
the Issuer or any Note Guarantor, as the case may be, is required to withhold or
deduct Taxes by law or by the interpretation or administration thereof. If the
Issuer or any Note Guarantor is so required to withhold or deduct any amount for
or on account of Taxes imposed by a Relevant Taxing Jurisdiction from any
payment made under or with respect to the Notes or the Note Guarantees, the
Issuer or the applicable Note Guarantor shall pay such additional amounts
("Additional Amounts") as may be necessary so that the net amount received by
each Holder (including Additional Amounts) after such withholding or deduction
shall not be less than the amount such Holder would have received if such Taxes
had not been withheld or deducted; provided, however, that the foregoing
obligation to pay Additional Amounts shall not apply to (1) any Taxes that would
not have been so imposed but for the existence of any present or former
connection between the relevant Holder (or between a fiduciary, settlor,
beneficiary, member or shareholder of, or possessor of power over the relevant
Holder, if the relevant Holder is an estate, nominee, trust or corporation) and
the Relevant Taxing Jurisdiction (other than the mere receipt of such payment or
the ownership or holding outside of the Cayman Islands of such Securities but
including, without limitation, such relevant Holder (or such fiduciary, settlor,
beneficiary, member or shareholder or possessor) being or
8
having been a citizen or resident thereof or being or having been present or
engaged in a trade or business therein or having or having had a permanent
establishment therein); or (2) any estate, inheritance, gift, sales, excise,
transfer, personal property tax or similar tax, assessment or governmental
charge; (3) any tax, assessment or other governmental charge that is imposed or
withheld by reason of the failure by the Holder or the beneficial owner of the
Securities to comply with a request of the Issuer or any Note Guarantor, as the
case may be, addressed to the Holder (x) to provide information, documents or
other evidence concerning the nationality, residence or identity of the Holder
or such beneficial owner or (y) to make and deliver any declaration or other
similar claim (other than a claim for refund of a tax, assessment or other
governmental charge withheld by the Issuer) or satisfy any information or
reporting requirements, which, in the case of (x) or (y), is required or imposed
by a statute, treaty, regulation or administrative practice of the taxing
jurisdiction as a precondition to exemption from all or part of such tax,
assessment or other governmental charge or (4) any tax, assessment or other
governmental charge that is payable otherwise than by withholding from payment
of principal of, premium, if any, or interest on such Securities; nor shall the
Issuer or any Note Guarantor, as applicable, be required to pay Additional
Amounts (a) if the payment could have been made without such deduction or
withholding if the beneficiary of the payment had presented the Securities for
payment within 30 days after the date on which such payment or such Securities
became due and payable or the date on which payment thereof is duly provided
for, whichever is later (except to the extent that the holder would have been
entitled to Additional Amounts had the Securities been presented on the last day
of such 30-day period), (b) if, at the election of the relevant Holder, the
payment of principal of (or premium, if any, on) or interest on such Securities
could have been made through another paying agent without such deduction or
withholding, or (c) with respect to any payment of principal of (or premium, if
any, on) or interest on such Securities to any Holder who is a fiduciary,
partnership or limited liability company that is treated as a partnership for
U.S. federal income tax purposes or any person other than the sole beneficial
owner of such payment, to the extent that a beneficiary or settlor with respect
to such fiduciary, a member of such partnership or limited liability company
that is treated as a partnership for U.S. federal income tax purposes or the
beneficial owner of such payment would not have been entitled to the Additional
Amounts had such beneficiary, settlor, member or beneficial owner been the
actual holder of such Securities.
(b) The Issuer shall provide the Trustee with official receipts
evidencing the payment of the Taxes with respect to which Additional Amounts are
paid.
(c) Whenever in the Indenture or in the Securities there is mentioned,
in any context: (1) the payment of principal; (2) purchase prices in connection
with a purchase of Securities; (3) interest; or (4) any other amount payable on
or with respect to any of the Securities, such reference shall be deemed to
include payment of Additional Amounts as required under this paragraph 7 to the
extent that, in such context, Additional Amounts are, were or would be payable
in respect thereof.
9
(d) The Issuer shall pay any present or future stamp, court or
documentary taxes or any other excise or property taxes, charges or similar
levies and other duties (including interest and penalties) that arise in any
jurisdiction from the execution, delivery, enforcement or registration of the
Securities, this Indenture or any other document or instrument in relation
thereof, or the receipt of any payments with respect to the Securities,
excluding such taxes, charges or similar levies imposed by any jurisdiction
outside of the Cayman Islands or the United States (or any political subdivision
or taxing authority of either jurisdiction), the jurisdiction of incorporation
of any successor of the Issuer, any jurisdiction through which payment is made
or in which a paying agent is located or any jurisdiction in which the Issuer is
organized or engaged in business for tax purposes, and the Issuer will agree to
indemnify the Holders for any such taxes paid by such Holders.
(e) The obligations arising under this paragraph shall survive any
termination, defeasance or discharge of this Indenture and will apply mutatis
mutandis to any jurisdiction in which any successor Person to the Issuer or any
Note Guarantor is organized or any political subdivision or taxing authority or
agency thereof or therein.
8. Sinking Fund
The Securities are not subject to any sinking fund.
9. Notice of Redemption
Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the redemption date to each Holder of
Securities to be redeemed at his or her registered address. Securities in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000. If money sufficient to pay the redemption price of and
accrued and unpaid interest and liquidated damages, if any, on all Securities
(or portions thereof) to be redeemed on the redemption date is deposited with
the Paying Agent on or before the redemption date and certain other conditions
are satisfied, on and after such date interest ceases to accrue on such
Securities (or such portions thereof) called for redemption.
10. Repurchase of Securities at the Option of Holders upon Change of Control
and Asset Dispositions
Upon a Change of Control, each Holder of Securities will have the
right, subject to certain conditions specified in the Indenture, to require the
Issuer to repurchase all or any part of the Securities of such Holder at a
purchase price equal to 101% of the principal amount of the Securities to be
repurchased plus accrued and unpaid interest and liquidated damages, if any, to
the date of repurchase (subject to the right of Holders of record on the
relevant record date to receive interest due and liquidated damages, if any, due
on the relevant
10
interest payment date that is on or prior to the date of purchase) as provided
in, and subject to the terms of, the Indenture.
In accordance with Section 4.06 of the Indenture, the Issuer will be
required to offer to purchase Securities upon the occurrence of certain events
at a purchase price equal to 100% of the principal amount of the Securities.
11. Subordination
The Securities and Note Guarantees are subordinated to Senior
Indebtedness. To the extent provided in the Indenture, Senior Indebtedness must
be paid before the Securities and Note Guarantees may be paid. The Issuer and
each Note Guarantor agrees, and each Holder by accepting a Security agrees, to
the subordination provisions contained in the Indenture and authorizes the
Trustee to give it effect and appoints the Trustee as attorney-in-fact for such
purpose.
12. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in denominations
of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange
Securities in accordance with the Indenture. Upon any transfer or exchange, the
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements or transfer documents and to pay any taxes required by
law or permitted by the Indenture. The Registrar need not register the transfer
of or exchange any Securities selected for redemption (except, in the case of a
Security to be redeemed in part, the portion of the Security not to be redeemed)
or to transfer or exchange any Securities for a period of 15 days prior to the
mailing of a notice of redemption of Securities to be redeemed.
13. Persons Deemed Owners
Except as provided in paragraph 2 hereof, the registered Holder of this
Security may be treated as the owner of it for all purposes.
14. Unclaimed Money
If money for the payment of principal, interest or liquidated damages,
if any, remains unclaimed for two years, the Trustee and the Paying Agent shall
pay the money back to the Issuer at its written request unless an abandoned
property law designates another Person. After any such payment, Holders entitled
to the money must look to the Issuer for payment as general creditors and the
Trustee and the Paying Agent shall have no further liability with respect to
such monies.
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15. Discharge and Defeasance
Subject to certain conditions, the Issuer at any time may terminate
some of or all its obligations under the Securities and the Indenture if the
Issuer deposits with the Trustee money or U.S. Government Obligations for the
payment of principal of, and interest and liquidated damages, if any, on, the
Securities to redemption or maturity, as the case may be.
16. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended without prior notice to any Holder
but with the written consent of the Holders of at least a majority in principal
amount of the outstanding Securities and (ii) any Default or compliance with any
provision may be waived with the written consent of the Holders of at least a
majority in principal amount of the outstanding Securities. Subject to certain
exceptions set forth in the Indenture, without the consent of any Holder, the
Issuer, the Note Guarantors and the Trustee may amend the Indenture or the
Securities (i) to cure any ambiguity, omission, defect or inconsistency; (ii) to
comply with Article 5 of the Indenture; (iii) to provide for uncertificated
Securities in addition to or in place of certificated Securities; (iv) to add
Note Guarantees with respect to the Securities; (v) to secure the Securities;
(vi) to add additional covenants for the benefit of the Holders or to surrender
rights and powers conferred on the Company or the Issuer; (vii) to comply with
the requirements of the SEC in order to effect or maintain the qualification of
the Indenture under the TIA; (viii) to make any change that does not adversely
affect the rights of any Holder; (ix) to make any change in the subordination
provisions of the Indenture that would limit or terminate the benefits available
to any holder of Senior Indebtedness of the Issuer (or any Representative
thereof) under such subordination provisions; or (x) to provide for the issuance
of the Exchange Securities, Private Exchange Securities, or Additional
Securities in compliance with Section 4.03.
17. Defaults and Remedies
If an Event of Default occurs (other than an Event of Default relating
to certain events of bankruptcy, insolvency or reorganization of the Company,
Intermediate Holdings, HDD Holdings or the Issuer) and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the outstanding
Securities may declare the principal of and accrued but unpaid interest on all
the Securities to be due and payable. If an Event of Default relating to certain
events of bankruptcy, insolvency or reorganization of the Company, Intermediate
Holdings, HDD Holdings or the Issuer occurs, the principal of and interest on
all the Securities shall become immediately due and payable without any
declaration or other act on the part of the Trustee or any Holders. Under
certain circumstances, the Holders of a majority in principal amount of the
outstanding Securities may rescind any such acceleration with respect to the
Securities and its consequences.
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If an Event of Default occurs and is continuing, the Trustee shall be
under no obligation to exercise any of the rights or powers under the Indenture
at the request or direction of any of the Holders unless such Holders have
offered to the Trustee reasonable indemnity or security against any loss,
liability or expense and certain other conditions are complied with. Except to
enforce the right to receive payment of principal, premium (if any) or interest
when due, no Holder may pursue any remedy with respect to the Indenture or the
Securities unless (i) such Holder has previously given the Trustee notice that
an Event of Default is continuing, (ii) Holders of at least 25% in principal
amount of the outstanding Securities have requested the Trustee in writing to
pursue the remedy, (iii) such Holders have offered the Trustee reasonable
security or indemnity against any loss, liability or expense, (iv) the Trustee
has not complied with such request within 60 days after the receipt of the
request and the offer of security or indemnity and (v) the Holders of a majority
in principal amount of the outstanding Securities have not given the Trustee a
direction inconsistent with such request within such 60-day period. Subject to
certain restrictions, the Holders of a majority in principal amount of the
outstanding Securities are given the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee. The Trustee, however,
may refuse to follow any direction that conflicts with law or the Indenture or
that the Trustee determines is unduly prejudicial to the rights of any other
Holder or that would involve the Trustee in personal liability. Prior to taking
any action under the Indenture, the Trustee shall be entitled to indemnification
satisfactory to it in its sole discretion against all losses and expenses caused
by taking or not taking such action.
18. Trustee Dealings with the Issuer
Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Issuer or its Affiliates and may otherwise deal with the Issuer or
its Affiliates with the same rights it would have if it were not Trustee.
19. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the Issuer or
any of the Note Guarantors shall not have any liability for any obligations of
the Issuer under the Securities or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. By accepting a
Security, each Holder waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Securities.
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20. Authentication
This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
21. 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 rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
22. Governing Law
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.
23. CUSIP and ISIN Numbers
The Issuer has caused CUSIP and ISIN numbers to be printed on the
Securities and has directed the Trustee to use CUSIP and ISIN numbers in notices
of redemption as a convenience to Holders. No representation is made as to the
accuracy of such numbers either as printed on the Securities or as contained in
any notice of redemption and reliance may be placed only on the other
identification numbers placed thereon.
THE ISSUER WILL FURNISH TO ANY HOLDER OF SECURITIES UPON WRITTEN
REQUEST AND WITHOUT CHARGE TO THE HOLDER A COPY OF THE INDENTURE WHICH HAS IN IT
THE TEXT OF THIS SECURITY.
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ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Security on the books
of the Issuer. The agent may substitute another to act for him.
- ------------------------------------------------------------
Date: Your Signature:
----------------- ----------------------
- ------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security.
15
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF
TRANSFER RESTRICTED SECURITIES
This certificate relates to $_________ principal amount of Securities held in
(check applicable space) ____ book-entry or _____ definitive form by the
undersigned.
The undersigned (check one box below):
[ ] has requested the Trustee by written order to deliver in exchange for
its beneficial interest in the Global Security held by the Depositary a
Security or Securities in definitive, registered form of authorized
denominations and an aggregate principal amount equal to its beneficial
interest in such Global Security (or the portion thereof indicated
above);
[ ] has requested the Trustee by written order to exchange or register the
transfer of a Security or Securities.
In connection with any transfer of any of the Securities evidenced by this
certificate occurring prior to the expiration of the period referred to in Rule
144(k) under the Securities Act, the undersigned confirms that such Securities
are being transferred in accordance with its terms:
CHECK ONE BOX BELOW
(1) [ ]to the Issuer; or
(2) [ ]to the Registrar for registration in the name of the
Holder, without transfer; or
(3) [ ]pursuant to an effective registration statement under the
Securities Act of 1933; or
(4) [ ]inside the United States to a "qualified institutional
buyer" (as defined in Rule 144A under the Securities Act of
1933) that purchases for its own account or for the account of
a qualified institutional buyer to whom notice is given that
such transfer is being made in reliance on Rule 144A, in each
case pursuant to and in compliance with Rule 144A under the
Securities Act of 1933; or
(5) [ ]outside the United States in an offshore transaction within
the meaning of Regulation S under the Securities Act in
compliance with Rule 904 under the Securities Act of 1933 and
such Security shall be held immediately after the transfer
through Euroclear or Clearstream until the expiration of the
Restricted Period (as defined in the Indenture); or
16
(6) [ ]to an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act of
1933) that has furnished to the Trustee a signed letter
containing certain representations and agreements; or
(7) [ ]pursuant to another available exemption from registration
provided by Rule 144 under the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register
any of the Securities evidenced by this certificate in the name of any
Person other than the registered Holder thereof; provided, however,
that if box (5), (6) or (7) is checked, the Trustee may require, prior
to registering any such transfer of the Securities, such legal
opinions, certifications and other information as the Issuer has
reasonably requested to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act of 1933.
---------------------------------
Your Signature
Signature Guarantee:
Date:
------------------- ---------------------------------
Signature must be guaranteed Signature of Signature
by a participant in a Guarantee
recognized signature guaranty
medallion program or other
signature guarantor acceptable
to the Trustee
- ------------------------------------------------------------
TO BE COMPLETED BY PURCHASER IF (4) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the Issuer as
the undersigned has requested pursuant to Rule 144A or has determined not to
17
request such information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the exemption
from registration provided by Rule 144A.
Dated:
------------------- ---------------------------
NOTICE: To be executed by
an executive officer
18
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The initial principal amount of this Global Security is $[ ]. The
following increases or decreases in this Global Security have been made:
Date of Amount of decrease in Amount of increase in Principal amount of this Signature of authorized
Exchange Principal Amount of this Principal Amount of this Global Security following signatory of Trustee or
Global Security Global Security such decrease or increase Securities Custodian
19
OPTION OF HOLDER TO ELECT PURCHASE
IF YOU WANT TO ELECT TO HAVE THIS SECURITY PURCHASED BY THE ISSUER
PURSUANT TO SECTION 4.06 (ASSET DISPOSITION) OR 4.08 (CHANGE OF CONTROL) OF THE
INDENTURE, CHECK ONE OF THE FOLLOWING BOXES:
ASSET DISPOSITION [ ] CHANGE OF CONTROL [ ]
IF YOU WANT TO ELECT TO HAVE ONLY PART OF THIS SECURITY PURCHASED BY
THE ISSUER PURSUANT TO SECTION 4.06 OR 4.08 OF THE INDENTURE, STATE THE AMOUNT
($1,000 OR AN INTEGRAL MULTIPLE THEREOF):
$
DATE: YOUR SIGNATURE:
------------------ ----------------------
(SIGN EXACTLY AS YOUR NAME APPEARS ON THE OTHER SIDE OF THE SECURITY)
SIGNATURE GUARANTEE:
---------------------------------------
SIGNATURE MUST BE GUARANTEED BY A PARTICIPANT IN A
RECOGNIZED SIGNATURE GUARANTY MEDALLION PROGRAM OR OTHER
SIGNATURE GUARANTOR ACCEPTABLE TO THE TRUSTEE
20
EXHIBIT B
[FORM OF FACE OF EXCHANGE SECURITY]
[Global Securities Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL
BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
No. $__________
12 1/2% Senior Subordinated Note due 2007
CUSIP No. ______
ISIN No. ____
SEAGATE TECHNOLOGY INTERNATIONAL, an exempted limited liability company
incorporated under the laws of the Cayman Islands, promises to pay to Cede &
Co., or registered assigns, the principal sum [of Dollars] [listed on the
Schedule of Increases or Decreases in Global Security attached hereto] on
November 15, 2007.
Interest Payment Dates: May 15 and November 15.
Record Dates: May 1 and November 1.
2
Additional provisions of this Security are set forth on the other side
of this Security.
IN WITNESS WHEREOF, the parties have caused this instrument to be duly
executed.
SEAGATE TECHNOLOGY
INTERNATIONAL,
by
------------------------------------
Name:
Title:
Dated:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
THE BANK OF NEW YORK,
as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.
by
-----------------------------
Authorized Signatory
*/ If the Security is to be issued in global form, add the Global
Securities Legend and the attachment from Exhibit A captioned
"TO BE ATTACHED TO GLOBAL SECURITIES--SCHEDULE OF INCREASES OR
DECREASES IN GLOBAL SECURITY".
3
[FORM OF REVERSE SIDE OF EXCHANGE SECURITY]
12 1/2% Senior Subordinated Note due 2007
1. Interest.
SEAGATE TECHNOLOGY INTERNATIONAL, an exempted limited liability company
incorporated under the laws of the Cayman Islands (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Issuer"), promises to pay interest on the principal amount of this
Security at the rate per annum shown above. The Issuer shall pay interest
semiannually on May 15 and November 15 of each year. Interest on the Securities
shall accrue from the most recent date to which interest has been paid or duly
provided for or, if no interest has been paid or duly provided for, from
November 22, 2000 until the principal hereof is due. Interest shall be computed
on the basis of a 360-day year of twelve 30-day months.
2. Method of Payment
The Issuer shall pay interest on the Securities (except defaulted
interest) to the Persons who are registered Holders at the close of business on
the May 1 or November 1 next preceding the interest payment date even if
Securities are canceled after the record date and on or before the interest
payment date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Issuer shall pay principal, premium, if any, and
interest in money of the United States of America that at the time of payment is
legal tender for payment of public and private debts. Payments in respect of the
Securities represented by a Global Security (including principal, premium, if
any, and interest) shall be made by wire transfer of immediately available funds
to the accounts specified by The Depository Trust Company or any successor
depositary. The Issuer shall make all payments in respect of a certificated
Security (including principal, premium, if any, and interest), at the office of
the Paying Agent, except that, at the option of the Issuer, payment of interest
may be made by mailing a check to the registered address of each Holder thereof;
provided, however, that payments on the Securities may also be made, in the case
of a Holder of at least $1,000,000 aggregate principal amount of Securities, by
wire transfer to a U.S. dollar account maintained by the payee with a bank in
the United States if such Holder elects payment by wire transfer by giving
written notice to the Trustee or the Paying Agent to such effect designating
such account no later than 30 days immediately preceding the relevant due date
for payment (or such other date as the Trustee may accept in its discretion).
3. Paying Agent and Registrar
Initially, The Bank of New York, a New York banking corporation (the
"Trustee"), will act as Paying Agent and Registrar. The Issuer may appoint and
change any
4
Paying Agent or Registrar without notice. The Company or any of its Wholly Owned
Subsidiaries may act as Paying Agent or Registrar.
4. Indenture
The Issuer issued the Securities under an Indenture dated as of
November 22, 2000 (the "Indenture"), among the Issuer, the Note Guarantors and
the Trustee. The terms of the Securities include those stated in the Indenture
and those made part of the Indenture by reference to the Trust Indenture Act of
1939 (15 U.S.C. ss.ss. 77aaa-77bbbb) as in effect on the date of the Indenture
(the "TIA"). Terms defined in the Indenture and not defined herein have the
meanings ascribed thereto in the Indenture. The Securities are subject to all
terms and provisions of the Indenture, and Holders are referred to the Indenture
and the TIA for a statement of such terms and provisions.
The Securities are senior subordinated unsecured obligations of the
Issuer. This Security is one of the [Exchange] [Additional] Securities referred
to in the Indenture. The Securities include the [Original] [Initial] Securities,
[the Additional Securities] and any Exchange Securities and Private Exchange
Securities issued in exchange for the Initial Securities pursuant to the
Indenture. The [Original] [Initial] Securities, [the Additional Securities], the
Exchange Securities and the Private Exchange Securities are treated as a single
class of securities under the Indenture. The Indenture imposes certain
limitations on the ability of the Company and its Restricted Subsidiaries
(including the Issuer) to, among other things, make certain Investments and
other Restricted Payments, pay dividends and other distributions, incur
Indebtedness, enter into consensual restrictions upon the payment of certain
dividends and distributions by such Restricted Subsidiaries, issue or sell
shares of capital stock of such Restricted Subsidiaries (including the Issuer),
enter into or permit certain transactions with Affiliates, enter into certain
lines of businesses, conduct rigid disc drive operations at certain
subsidiaries, amend Deferred Compensation Plans and make Asset Sales. The
Indenture also imposes limitations on the ability of the Issuer and each Note
Guarantor to consolidate or merge with or into any other Person or convey,
transfer or lease all or substantially all of its property.
To guarantee the due and punctual payment of the principal of and
premium, if any, and interest on the Securities and all other amounts payable by
the Issuer under the Indenture and the Securities when and as the same shall be
due and payable, whether at maturity, by acceleration or otherwise, according to
the terms of the Securities and the Indenture, the Note Guarantors have, jointly
and severally, unconditionally guaranteed the Guaranteed Obligations on a senior
subordinated basis pursuant to the terms of the Indenture.
5. Optional Redemption
Except as described below, the Issuer may not redeem the Securities
prior to November 15, 2004. On or after such date, the Issuer may redeem the
Securities, in whole or
5
in part, on not less than 30 nor more than 60 days prior notice, at the
following redemption prices (expressed as percentages of principal amount), plus
accrued and unpaid interest, if any, to the redemption date (subject to the
right of Holders of record on the relevant record date to receive interest due
on the relevant interest payment date), if redeemed during the 12-month period
commencing on November 15 of the years set forth below:
REDEMPTION
YEAR PRICE
-------------------------------------------------
2004 106.250%
2005 103.313%
2006 and thereafter 100.000%
In addition, at any time and from time to time on or prior to November
15, 2003, the Issuer may redeem up to a maximum of 35% of the original aggregate
principal amount of the Securities (calculated giving effect to any issuance of
Additional Securities) with the Net Cash Proceeds of one or more Equity
Offerings (i) by the Issuer or (ii) by the Company, Intermediate Holdings or HDD
Holdings to the extent the Net Cash Proceeds thereof are contributed to the
Issuer or used to purchase Capital Stock (other than Disqualified Stock) of the
Issuer from the Issuer, at a redemption price equal to 112.5% of the principal
amount thereof, plus accrued and unpaid interest thereon, if any, to the
redemption date (subject to the right of Holders of record on the relevant
record date to receive interest due on the relevant interest payment date);
provided, however, that after giving effect to any such redemption: (1) at least
65% of the original aggregate principal amount of the Securities (calculated
giving effect to any issuance of Additional Securities) remains outstanding and
(2) any such redemption shall be made within 90 days of such Equity Offering
upon not less than 30 nor more than 60 days notice mailed to each Holder of
Securities being redeemed and otherwise in accordance with the procedures set
forth in the Indenture.
In addition, at any time on or prior to November 15, 2004, the
Securities may be redeemed as a whole but not in part at the option of the
Issuer upon the occurrence of a, or if applicable each, Change of Control, upon
not less than 30 or more than 60 days' prior notice (but in no event may any
such redemption occur more than 90 days after the occurrence of such Change of
Control) mailed by first-class mail to each Holder's registered address, at a
redemption price equal to the sum of (1) the principal amount thereof and (2)
the Applicable Premium as of, and accrued and unpaid interest, if any, to, the
redemption date (subject to the right of Holders on the relevant record date to
receive interest due on the relevant interest payment date).
6. Redemption for Changes in Withholding Taxes
(a) The Issuer, which shall include any Successor Company (as such term
is defined in Section 5.01(a)(i) of the Indenture) shall be entitled to redeem
the Securities, at its option, at any time as a whole but not in part, upon not
less than 30 nor more than 60 days'
6
notice given as provided in Article 3 of the Indenture, at an amount equal to
100% of the principal amount thereof, plus accrued and unpaid interest (if any)
and liquidated damages, if any, to the date fixed for such payment (subject to
the right of Holders of record on the relevant record date to receive interest
due on the relevant interest payment date), in the event the Issuer has become
or would become obligated to pay, on the next date on which any amount would be
payable with respect to the Securities, any Additional Amounts as a result of:
(1) a change in or an amendment to the laws (including any regulations or ruling
promulgated thereunder) of (x) the Cayman Islands, (y) any jurisdiction, other
than the United States, from or through which payment on the Securities is made
or (z) any other jurisdiction, other than the United States, in which the Issuer
or a Successor Company is organized (or any political subdivision or taxing
authority thereof or therein), which change or amendment is announced or becomes
effective on or after the Closing Date (and, in the case of a Successor Company,
becomes effective after the date of that entity's assumption of the Issuer's
obligations under the Securities); or (2) any change in or amendment to any
official position regarding the application or interpretation of such laws,
regulations or rulings, or any execution of or amendment to, any treaty or
treaties affecting taxation to which such jurisdiction (or such political
subdivision or taxing authority) is a party, which change or amendment is
announced or becomes effective on or after the Closing Date; and, in the case of
clauses (1) and (2) above, the Issuer or the Successor Company, if applicable,
cannot avoid such obligation by taking reasonable measures available to it.
(b) Prior to the notice of redemption given in accordance with the
foregoing paragraph 6(a), the Issuer or the Successor Company, if applicable,
shall deliver to the Trustee an officers' certificate to the effect that the
Issuer or the Successor Company, if applicable, cannot avoid its obligation to
pay Additional Amounts by taking reasonable measures available to it. The Issuer
or the Successor Company, if applicable, shall also deliver an opinion of
independent legal counsel of recognized standing stating that the Issuer or the
Successor Company, if applicable, would be obligated to pay Additional Amounts
as a result of a change in tax laws or regulations or the application or
interpretation of such laws or regulations.
7. Additional Amounts.
(a) The Issuer, which shall include any Successor Company (as such term
is defined in Section 5.01(a)(i) of the Indenture), shall make all its payments
under or with respect to the Securities and each Note Guarantor, which shall
include any Successor Guarantor (as such term is defined in the Indenture),
shall make all payments under or with respect to the Note Guarantees free and
clear of and without withholding or deduction for or on account of any present
or future tax, duty, levy, impost, assessment or other governmental charge
(including penalties, interest and other liabilities related thereto)
(hereinafter "Taxes") imposed or levied by or on behalf of the government of the
Cayman Islands or any political subdivision or any authority or agency therein
or thereof having power to tax, or within any other jurisdiction in which it is
organized or is otherwise resident for tax purposes or any
7
jurisdiction from or through which payment is made (each a "Relevant Taxing
Jurisdiction"), unless the Issuer or any Note Guarantor, as the case may be, is
required to withhold or deduct Taxes by law or by the interpretation or
administration thereof. If the Issuer or any Note Guarantor is so required to
withhold or deduct any amount for or on account of Taxes imposed by a Relevant
Taxing Jurisdiction from any payment made under or with respect to the Notes or
the Note Guarantees, the Issuer or the applicable Note Guarantor shall pay such
additional amounts ("Additional Amounts") as may be necessary so that the net
amount received by each Holder (including Additional Amounts) after such
withholding or deduction shall not be less than the amount such Holder would
have received if such Taxes had not been withheld or deducted; provided,
however, that the foregoing obligation to pay Additional Amounts shall not apply
to (1) any Taxes that would not have been so imposed but for the existence of
any present or former connection between the relevant Holder (or between a
fiduciary, settlor, beneficiary, member or shareholder of, or possessor of power
over the relevant Holder, if the relevant Holder is an estate, nominee, trust or
corporation) and the Relevant Taxing Jurisdiction (other than the mere receipt
of such payment or the ownership or holding outside of the Cayman Islands of
such Securities but including, without limitation, such relevant Holder (or such
fiduciary, settlor, beneficiary, member or shareholder or possessor) being or
having been a citizen or resident thereof or being or having been present or
engaged in a trade or business therein or having or having had a permanent
establishment therein); or (2) any estate, inheritance, gift, sales, excise,
transfer, personal property tax or similar tax, assessment or governmental
charge; (3) any tax, assessment or other governmental charge that is imposed or
withheld by reason of the failure by the Holder or the beneficial owner of the
Securities to comply with a request of the Issuer or any Note Guarantor, as the
case may be, addressed to the Holder (x) to provide information, documents or
other evidence concerning the nationality, residence or identity of the Holder
or such beneficial owner or (y) to make and deliver any declaration or other
similar claim (other than a claim for refund of a tax, assessment or other
governmental charge withheld by the Issuer) or satisfy any information or
reporting requirements, which, in the case of (x) or (y), is required or imposed
by a statute, treaty, regulation or administrative practice of the taxing
jurisdiction as a precondition to exemption from all or part of such tax,
assessment or other governmental charge or (4) any tax, assessment or other
governmental charge that is payable otherwise than by withholding from payment
of principal of, premium, if any, or interest on such Securities; nor shall the
Issuer or any Note Guarantor, as applicable, be required to pay Additional
Amounts (a) if the payment could have been made without such deduction or
withholding if the beneficiary of the payment had presented the Securities for
payment within 30 days after the date on which such payment or such Securities
became due and payable or the date on which payment thereof is duly provided
for, whichever is later (except to the extent that the holder would have been
entitled to Additional Amounts had the Securities been presented on the last day
of such 30-day period), (b) if, at the election of the relevant Holder, the
payment of principal of (or premium, if any, on) or interest on such Securities
could have been made through another paying agent without such deduction or
withholding, or (c) with respect to any payment of principal of (or premium, if
any, on) or interest on such Securities to any Holder who is a fiduciary,
partnership or limited
8
liability company that is treated as a partnership for U.S. federal income tax
purposes or any person other than the sole beneficial owner of such payment, to
the extent that a beneficiary or settlor with respect to such fiduciary, a
member of such partnership or limited liability company that is treated as a
partnership for U.S. federal income tax purposes or the beneficial owner of such
payment would not have been entitled to the Additional Amounts had such
beneficiary, settlor, member or beneficial owner been the actual holder of such
Securities.
(b) The Issuer shall provide the Trustee with official receipts
evidencing the payment of the Taxes with respect to which Additional Amounts are
paid.
(c) Whenever in the Indenture or in the Securities there is mentioned,
in any context: (1) the payment of principal; (2) purchase prices in connection
with a purchase of Securities; (3) interest; or (4) any other amount payable on
or with respect to any of the Securities, such reference shall be deemed to
include payment of Additional Amounts as required under this paragraph 7 to the
extent that, in such context, Additional Amounts are, were or would be payable
in respect thereof.
(d) The Issuer shall pay any present or future stamp, court or
documentary taxes or any other excise or property taxes, charges or similar
levies and other duties (including interest and penalties) that arise in any
jurisdiction from the execution, delivery, enforcement or registration of the
Securities, this Indenture or any other document or instrument in relation
thereof, or the receipt of any payments with respect to the Securities,
excluding such taxes, charges or similar levies imposed by any jurisdiction
outside of the Cayman Islands or the United States (or any political subdivision
or taxing authority of either jurisdiction), the jurisdiction of incorporation
of any successor of the Issuer, any jurisdiction through which payment is made
or in which a paying agent is located or any jurisdiction in which the Issuer is
organized or engaged in business for tax purposes, and the Issuer will agree to
indemnify the Holders for any such taxes paid by such Holders.
(e) The obligations arising under this paragraph shall survive any
termination, defeasance or discharge of this Indenture and will apply mutatis
mutandis to any jurisdiction in which any successor Person to the Issuer or any
Note Guarantor is organized or any political subdivision or taxing authority or
agency thereof or therein.
8. Sinking Fund
The Securities are not subject to any sinking fund.
9. Notice of Redemption
Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the redemption date to each Holder of
Securities to be redeemed at his or her registered address. Securities in
denominations larger than $1,000 may be
9
redeemed in part but only in whole multiples of $1,000. If money sufficient to
pay the redemption price of and accrued and unpaid interest and liquidated
damages, if any, on all Securities (or portions thereof) to be redeemed on the
redemption date is deposited with the Paying Agent on or before the redemption
date and certain other conditions are satisfied, on and after such date interest
ceases to accrue on such Securities (or such portions thereof) called for
redemption.
10. Repurchase of Securities at the Option of Holders upon Change of Control and
Asset Dispositions
Upon a Change of Control, each Holder of Securities will have the
right, subject to certain conditions specified in the Indenture, to require the
Issuer to repurchase all or any part of the Securities of such Holder at a
purchase price equal to 101% of the principal amount of the Securities to be
repurchased plus accrued and unpaid interest, if any, to the date of repurchase
(subject to the right of Holders of record on the relevant record date to
receive interest due on the relevant interest payment date that is on or prior
to the date of purchase) as provided in, and subject to the terms of, the
Indenture.
In accordance with Section 4.06 of the Indenture, the Issuer will be
required to offer to purchase Securities upon the occurrence of certain events.
11. Subordination
The Securities and Note Guarantees are subordinated to Senior
Indebtedness, as defined in the Indenture. To the extent provided in the
Indenture, Senior Indebtedness must be paid before the Securities may be paid.
The Issuer and each Note Guarantor agrees, and each Holder by accepting a
Security agrees, to the subordination provisions contained in the Indenture and
authorizes the Trustee to give it effect and appoints the Trustee as
attorney-in-fact for such purpose.
12. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in denominations
of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange
Securities in accordance with the Indenture. Upon any transfer or exchange, the
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements or transfer documents and to pay any taxes required by
law or permitted by the Indenture. The Registrar need not register the transfer
of or exchange any Securities selected for redemption (except, in the case of a
Security to be redeemed in part, the portion of the Security not to be redeemed)
or to transfer or exchange any Securities for a period of 15 days prior to the
mailing of a notice of redemption of Securities to be redeemed.
10
13. Persons Deemed Owners
Except as provided in paragraph 2 hereof, the registered Holder of this
Security may be treated as the owner of it for all purposes.
14. Unclaimed Money
If money for the payment of principal or interest remains unclaimed for
two years, the Trustee and the Paying Agent shall pay the money back to the
Issuer at its written request unless an abandoned property law designates
another Person. After any such payment, Holders entitled to the money must look
to the Issuer for payment as general creditors and the Trustee and the Paying
Agent shall have no further liability with respect to such monies.
15. Discharge and Defeasance
Subject to certain conditions, the Issuer at any time may terminate
some of or all its obligations under the Securities and the Indenture if the
Issuer deposits with the Trustee money or U.S. Government Obligations for the
payment of principal and interest on the Securities to redemption or maturity,
as the case may be.
16. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended without prior notice to any Holder
but with the written consent of the Holders of at least a majority in aggregate
principal amount of the outstanding Securities and (ii) any default may be
waived with the written consent of the Holders of at least a majority in
principal amount of the outstanding Securities. Subject to certain exceptions
set forth in the Indenture, without the consent of any Holder, the Issuer, the
Note Guarantors and the Trustee may amend the Indenture or the Securities (i) to
cure any ambiguity, omission, defect or inconsistency; (ii) to comply with
Article 5 of the Indenture; (iii) to provide for uncertificated Securities in
addition to or in place of certificated Securities; (iv) to add Note Guarantees
with respect to the Securities; (v) to secure the Securities; (vi) to add
additional covenants or to surrender rights and powers conferred on the Issuer;
(vii) to comply with the requirements of the SEC in order to effect or maintain
the qualification of the Indenture under the TIA; (viii) to make any change that
does not adversely affect the rights of any Holder; (ix) to make any change in
the subordination provisions of the Indenture that would limit or terminate the
benefits available to any holder of Senior Indebtedness of the Issuer (or any
Representative thereof) under such subordination provisions; or (x) to provide
for the issuance of the Exchange Securities, Private Exchange Securities or
Additional Securities.
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17. Defaults and Remedies
If an Event of Default occurs (other than an Event of Default relating
to certain events of bankruptcy, insolvency or reorganization of the Company
Intermediate Holdings, HDD Holdings or the Issuer) and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the outstanding
Securities may declare the principal of and accrued but unpaid interest on all
the Securities to be due and payable. If an Event of Default relating to certain
events of bankruptcy, insolvency or reorganization of the Company, Intermediate
Holdings, HDD Holdings or the Issuer occurs, the principal of and interest on
all the Securities shall become immediately due and payable without any
declaration or other act on the part of the Trustee or any Holders. Under
certain circumstances, the Holders of a majority in principal amount of the
outstanding Securities may rescind any such acceleration with respect to the
Securities and its consequences.
If an Event of Default occurs and is continuing, the Trustee shall be
under no obligation to exercise any of the rights or powers under the Indenture
at the request or direction of any of the Holders unless such Holders have
offered to the Trustee reasonable indemnity or security against any loss,
liability or expense and certain other conditions are complied with. Except to
enforce the right to receive payment of principal, premium (if any) or interest
when due, no Holder may pursue any remedy with respect to the Indenture or the
Securities unless (i) such Holder has previously given the Trustee notice that
an Event of Default is continuing, (ii) Holders of at least 25% in principal
amount of the outstanding Securities have requested the Trustee in writing to
pursue the remedy, (iii) such Holders have offered the Trustee reasonable
security or indemnity against any loss, liability or expense, (iv) the Trustee
has not complied with such request within 60 days after the receipt of the
request and the offer of security or indemnity and (v) the Holders of a majority
in principal amount of the outstanding Securities have not given the Trustee a
direction inconsistent with such request within such 60-day period. Subject to
certain restrictions, the Holders of a majority in principal amount of the
outstanding Securities are given the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee. The Trustee, however,
may refuse to follow any direction that conflicts with law or the Indenture or
that the Trustee determines is unduly prejudicial to the rights of any other
Holder or that would involve the Trustee in personal liability. Prior to taking
any action under the Indenture, the Trustee shall be entitled to indemnification
satisfactory to it in its sole discretion against all losses and expenses caused
by taking or not taking such action.
18. Trustee Dealings with the Issuer
Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Issuer or its
12
Affiliates and may otherwise deal with the Issuer or its Affiliates with the
same rights it would have if it were not Trustee.
19. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the Issuer or
any of the Note Guarantors shall not have any liability for any obligations of
the Issuer under the Securities or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. By accepting a
Security, each Holder waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Securities.
20. Authentication
This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
21. 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 rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
22. Governing Law
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.
23. CUSIP and ISIN Numbers
The Issuer has caused CUSIP and ISIN numbers to be printed on the
Securities and has directed the Trustee to use CUSIP and ISIN numbers in notices
of redemption as a convenience to Holders. No representation is made as to the
accuracy of such numbers either as printed on the Securities or as contained in
any notice of redemption and reliance may be placed only on the other
identification numbers placed thereon.
THE ISSUER WILL FURNISH TO ANY HOLDER OF SECURITIES UPON WRITTEN
REQUEST AND WITHOUT CHARGE TO THE HOLDER A COPY OF THE INDENTURE WHICH HAS IN IT
THE TEXT OF THIS SECURITY.
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ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Security on
the books of the Issuer. The agent may substitute another to act for him.
- ------------------------------------------------------------
Date: Your Signature:
---------------- ---------------------
- ------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security. Signature
must be guaranteed by a participant in a recognized signature guaranty medallion
program or other signature guarantor acceptable to the Trustee.
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OPTION OF HOLDER TO ELECT PURCHASE
IF YOU WANT TO ELECT TO HAVE THIS SECURITY PURCHASED BY THE ISSUER
PURSUANT TO SECTION 4.06 (ASSET DISPOSITION) OR 4.08 (CHANGE OF CONTROL) OF THE
INDENTURE, CHECK ONE OF THE FOLLOWING BOXES:
ASSET DISPOSITION [ ] CHANGE OF CONTROL [ ]
IF YOU WANT TO ELECT TO HAVE ONLY PART OF THIS SECURITY PURCHASED BY
THE ISSUER PURSUANT TO SECTION 4.06 OR 4.08 OF THE INDENTURE, STATE THE AMOUNT
($1,000 OR AN INTEGRAL MULTIPLE THEREOF):
$
DATE: YOUR SIGNATURE:
------------------ --------------------
(SIGN EXACTLY AS YOUR NAME APPEARS
ON THE OTHER SIDE OF THE SECURITY)
SIGNATURE GUARANTEE:
---------------------------------------
SIGNATURE MUST BE GUARANTEED BY A PARTICIPANT IN A
RECOGNIZED SIGNATURE GUARANTY MEDALLION PROGRAM OR OTHER
SIGNATURE GUARANTOR ACCEPTABLE TO THE TRUSTEE.
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[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The initial principal amount of this Global Security is $[ ]. The
following increases or decreases in this Global Security have been made:
Date of Amount of decrease in Amount of increase in Principal amount of this Signature of authorized
Exchange Principal Amount of this Principal Amount of this Global Security following signatory of Trustee or
Global Security Global Security such decrease or increase Securities Custodian
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EXHIBIT C
FORM OF SUPPLEMENTAL INDENTURE
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture")
dated as of , among [GUARANTOR] (the "New Guarantor"), a
subsidiary of NEW SAC (or its successor), an exempted
limited liability company incorporated under the laws of the
Cayman Islands (the "Company"), the Company, SEAGATE
TECHNOLOGY INTERNATIONAL (or its successor), an exempted
limited liability company incorporated under the laws of the
Cayman Islands (the "Issuer"), [EXISTING NOTE GUARANTORS]
and THE BANK OF NEW YORK, a New York banking corporation, as
trustee under the indenture referred to below (the
"Trustee").
W I T N E S S E T H :
WHEREAS the Issuer and [EXISTING NOTE GUARANTORS] (the "Existing
Guarantors") have heretofore executed and delivered to the Trustee an Indenture
(the "Indenture") dated as of November 22, 2000, providing for the issuance of
12 1/2% Senior Subordinated Notes due 2007 (the "Securities");
WHEREAS Section 4.11 of the Indenture provides that under certain
circumstances the Company is required to cause the New Guarantor to execute and
deliver to the Trustee a supplemental indenture pursuant to which the New
Guarantor shall unconditionally guarantee all the Issuer's obligations under the
Securities pursuant to a Note Guarantee on the terms and conditions set forth
herein; and
WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee, the
Company, the Issuer and the Existing Guarantors are authorized to execute and
deliver this Supplemental Indenture;
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the New
Guarantor, the Issuer, the Existing Guarantors and the Trustee mutually covenant
and agree for the equal and ratable benefit of the holders of the Securities as
follows:
1. Agreement to Guarantee. The New Guarantor hereby agrees, jointly and
severally with all the Existing Guarantors, to unconditionally guarantee the
Issuer's obligations under the Securities on the terms and subject to the
conditions set forth in Articles 11 and 12 of the Indenture and to be bound by
all other applicable provisions of the Indenture and the Securities (including,
without limitation, Sections 13.10 and 13.11 of the Indenture).
2. Ratification of Indenture; Supplemental Indentures Part of
Indenture. Except as expressly amended hereby, the Indenture is in all respects
ratified and confirmed and all the terms, conditions and provisions thereof
shall remain in full force and effect. This Supplemental Indenture shall form a
part of the Indenture for all purposes, and every holder of Securities
heretofore or hereafter authenticated and delivered shall be bound hereby.
3. Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
4. Trustee Makes No Representation. The Trustee makes no representation
as to the validity or sufficiency of this Supplemental Indenture.
5. Counterparts. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
6. Effect of Headings. The Section headings herein are for convenience
only and shall not effect the construction thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed as of the date first above written.
[NEW GUARANTOR],
by
---------------------------------
Name:
Title:
SEAGATE TECHNOLOGY
INTERNATIONAL,
by
---------------------------------
Name:
Title:
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[EXISTING NOTE GUARANTORS],
by
---------------------------------
Name:
Title:
THE BANK OF NEW YORK, as Trustee,
by
---------------------------------
Name:
Title:
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EXHIBIT D
Form of
Transferee Letter of Representation
Seagate Technology International
700 Ang Mo Kio Avenue #5
Singapore 569877
Ladies and Gentlemen:
This certificate is delivered to request a transfer of $[ ]
principal amount of the 12 1/2% Senior Subordinated Notes due 2007 (the
"Securities") of Seagate Technology International (the "Issuer").
Upon transfer, the Securities would be registered in the name of the
new beneficial owner as follows:
Name:
----------------------------
Address:
-------------------------
Taxpayer ID Number:
--------------
The undersigned represents and warrants to you that:
1. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the
"Securities Act")), purchasing for our own account or for the account of such an
institutional "accredited investor" at least $250,000 principal amount of the
Securities, and we are acquiring the Securities not with a view to, or for offer
or sale in connection with, any distribution in violation of the Securities Act.
We have such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Securities,
and we invest in or purchase securities similar to the Securities in the normal
course of our business. We, and any accounts for which we are acting, are each
able to bear the economic risk of our or its investment.
2. We understand that the Securities have not been registered under the
Securities Act and, unless so registered, may not be sold except as permitted in
the following sentence. We agree on our own behalf and on behalf of any investor
account for which we are purchasing Securities to offer, sell or otherwise
transfer such Securities prior to the date that is two years after the later of
the date of original issue and the last date on which the Issuer or any
affiliate of the Issuer was the owner of such Securities (or any predecessor
thereto) (the "Resale Restriction Termination Date") only (a) to
the Issuer, (b) pursuant to a registration statement that has been declared
effective under the Securities Act, (c) in a transaction complying with the
requirements of Rule 144A under the Securities Act ("Rule 144A"), to a person we
reasonably believe is a qualified institutional buyer under Rule 144A (a "QIB")
that is purchasing for its own account or for the account of a QIB and to whom
notice is given that the transfer is being made in reliance on Rule 144A, (d)
pursuant to offers and sales that occur outside the United States within the
meaning of Regulation S under the Securities Act, (e) to an institutional
"accredited investor" within the meaning of Rule 501(a)(1), (2), (3) or (7)
under the Securities Act that is purchasing for its own account or for the
account of such an institutional "accredited investor," in each case in a
minimum principal amount of Securities of $250,000, or (f) pursuant to any other
available exemption from the registration requirements of the Securities Act,
subject in each of the foregoing cases to any requirement of law that the
disposition of our property or the property of such investor account or accounts
be at all times within our or their control and in compliance with any
applicable state securities laws. The foregoing restrictions on resale will not
apply subsequent to the Resale Restriction Termination Date. If any resale or
other transfer of the Securities is proposed to be made pursuant to clause (e)
above prior to the Resale Restriction Termination Date, the transferor shall
deliver a letter from the transferee substantially in the form of this letter to
the Issuer and the Trustee, which shall provide, among other things, that the
transferee is an institutional "accredited investor" within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act and that it is acquiring
such Securities for investment purposes and not for distribution in violation of
the Securities Act. Each purchaser acknowledges that the Issuer and the Trustee
reserve the right prior to the offer, sale or other transfer prior to the Resale
Restriction Termination Date of the Securities pursuant to clause (d), (e) or
(f) above to require the delivery of an opinion of counsel, certifications or
other information satisfactory to the Issuer and the Trustee.
TRANSFEREE: ,
---------------------------
by:
-----------------------------------
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