Exhibit 4.2
CERTIFICATE OF DESIGNATIONS SETTING FORTH THE
VOTING POWER, PREFERENCES AND RELATIVE,
PARTICIPATING, OPTIONAL AND
OTHER SPECIAL RIGHTS
AND QUALIFICATIONS, LIMITATIONS
AND RESTRICTIONS
OF THE
10 3/4% SERIES B CUMULATIVE EXCHANGEABLE
REDEEMABLE PREFERRED STOCK
OF
SPANISH BROADCASTING SYSTEM, INC.
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Pursuant to Section 151
of the General Corporation Law
of the State of Delaware
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Spanish Broadcasting System, Inc. (the "Company"), a corporation
organized and existing under the General Corporation Law of the State of
Delaware, does hereby certify that, pursuant to authority conferred upon the
board of directors of the Company (the "Board of Directors") by its Certificate
of Incorporation, as amended and restated (the "Certificate of Incorporation"),
and pursuant to the provisions of Section 151 of the General Corporation Law of
the State of Delaware, the Board of Directors, on October 28, 2003 duly approved
and adopted the following resolution (the "Resolution"):
RESOLVED, that, pursuant to the authority vested in the Board of
Directors by its Certificate of Incorporation, the Board of Directors does
hereby designate, create, authorize and provide for the issuance of 10 3/4%
Series B Cumulative Exchangeable Redeemable Preferred Stock, par value $.01 per
share, with a liquidation preference of $1,000.00 per share, consisting of
280,000 shares, having the designations, preferences, relative, participating,
optional and other special rights and the qualifications, limitations and
restrictions thereof that are set forth in the Certificate of Incorporation and
in this Resolution as follows:
1. DESIGNATION.
(a) There is hereby created out of the authorized and unissued
shares of preferred stock of the Company a series of preferred
stock designated as the "10 3/4% Series B Cumulative
Exchangeable Redeemable Preferred Stock." The number of shares
constituting such series shall be 280,000 and are referred to
as the "Series B Preferred Stock." The liquidation preference
of the Series B Preferred Stock shall be $1,000.00 per share.
(b) Shares of Series B Preferred Stock that have been issued and
reacquired in any manner, including shares purchased or
redeemed or exchanged, shall (upon compliance with any
applicable provisions of the laws of Delaware) have the status
of authorized and unissued shares of preferred stock
undesignated as to series and may be redesignated and reissued
as part of any series of preferred stock; provided that any
issuance of such shares as Series B Preferred Stock must be in
compliance with the terms hereof.
2. CERTAIN DEFINITIONS.
Unless the context otherwise requires, the terms defined in this
Section 2 shall have, for all purposes of this resolution, the meanings herein
specified (with terms defined in the singular having comparable meanings when
used in the plural).
"Acquired Debt" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, including,
without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person; and (ii) Indebtedness secured by a Lien
encumbering any asset acquired by such specified Person.
"Affiliate" of any specified Person means any other Person which
directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, such specified Person. For the
purposes of this definition, "control" (including, with correlative meanings,
the terms "controlling," "controlled by," and "under common control with"), as
used with respect to any Person, means the possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of
such Person, whether through the ownership of voting securities, by agreement or
otherwise; provided that (a) beneficial ownership of at least 10% of the Voting
Stock of a Person shall be deemed to be control and (b) for purposes of the
"Transactions with Affiliates" covenant contained in Section 11(d), for so long
as Pablo Raul Alarcon, Sr., Raul Alarcon, Jr. or Jose Grimalt are directors,
officers or shareholders of the Company, they, their respective spouses, lineal
descendants and any Person controlled by any of them shall be Affiliates of the
Company and its Subsidiaries.
"Affiliate Transaction" has the meaning set forth in Section 11(d).
"Applicable Redemption Price" means a price per share equal to the
following redemption prices specified below (expressed as a percentage of the
Liquidation Preference thereof), plus, without duplication, an amount in cash
equal to all accumulated and unpaid dividends per share, if any, to but
excluding the Redemption Date (including an amount equal to the pro rated
dividend for the period from the Dividend Payment Date immediately prior to the
Redemption Date to but excluding the Redemption Date) if redeemed during the
12-month period commencing on October 15 of each of the years set forth below:
2008............................................. 105.375%
2009............................................. 103.583%
2010............................................. 101.792%
2011 and thereafter.............................. 100.000%
"Asset Sale" means (i) the sale, lease, conveyance or other disposition
of any assets or rights (including, without limitation, by way of a sale and
leaseback), excluding sales of services and goods in the ordinary course of
business consistent with past practices and (ii) the issue or sale by the
Company or any of its Subsidiaries of Equity Interests of any of the Company's
Subsidiaries, in the case of either clause (i) or (ii), whether in a single
transaction or a series of related transactions (a) that have a fair market
value in excess of $5.0 million or (b) for net proceeds in excess of $5.0
million.
Notwithstanding the foregoing, the following items will not be deemed
to be Asset Sales: (i) a transfer of assets by the Company to a Wholly Owned
Restricted Subsidiary or by a Wholly Owned Restricted Subsidiary to the Company
or to another Wholly Owned Restricted Subsidiary, (ii) an issuance of Equity
Interests by a Wholly Owned Restricted Subsidiary to the Company or to another
Wholly
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Owned Restricted Subsidiary, (iii) the sale, lease or other disposition of
equipment or other assets in the ordinary course of business, (iv) the sale and
leaseback of any assets within 90 days of the acquisition of such assets, (v) a
Restricted Payment that is permitted by Section 11(a) hereof, (vi) a transfer of
any FCC License to a Non-Guarantor Subsidiary, described in clause (i) of the
definition thereof, (vii) an Asset Swap, and (viii) the sale or other
disposition by the Company or its Subsidiaries of the Company's radio stations
KLEY-FM and KSAH-AM serving the San Antonio, Texas market, and radio station
KPTI-FM serving the San Francisco, California market.
"Asset Swap" means the execution of a definitive agreement, subject
only to regulatory approval and other customary closing conditions, that the
Company in good faith believes will be satisfied, for a substantially concurrent
purchase and sale, or exchange, of assets used or useful in a Permitted Business
between the Company or any of its Restricted Subsidiaries and another person or
group of affiliated persons; provided that any amendment to or waiver of any
closing conditions which individually or in the aggregate is material to the
Asset Swap shall be deemed to be a new Asset Swap.
"Attributable Debt" in respect of a sale and leaseback transaction
means, at the time of determination, the present value (discounted at the rate
of interest implicit in such transaction, determined in accordance with GAAP) of
the obligation of the lessee for net rental payments during the remaining term
of the lease included in such sale and leaseback transaction (including any
period for which such lease has been extended or may, at the option of the
lessor, be extended).
"Basket Period" has the meaning set forth in Section 11(a).
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3
and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "person," as such term is used in Section 13(d)(3)
of the Exchange Act, such "person" shall be deemed to have beneficial ownership
of all securities that such "person" has the right to acquire, whether such
right is currently exercisable or is exercisable only upon the occurrence of a
subsequent condition.
"Business Day" means any day other than a Saturday, a Sunday or a day
on which banking institutions in the City of New York or at a place of payment
are authorized by law, regulation or executive order to remain closed. If any
payment, redemption, repurchase or exchange shall be required by the terms
hereof to be made on a day that is not a Business Day, such payment, redemption,
repurchase or exchange shall be made on the immediately succeeding Business Day.
"Capital Lease Obligation" means, at the time any determination thereof
is to be made, the amount of the liability in respect of a capital lease that
would at such time be required to be capitalized on a balance sheet in
accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate
stock, (ii) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership or limited
liability company, partnership or membership interests (whether general or
limited) and (iv) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.
"Cash Equivalents" means (i) United States dollars, (ii) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof having maturities of not
more than one year from the date of acquisition, (iii) certificates of deposit
and eurodollar time deposits with maturities of one year or less from the date
of acquisition, bankers' acceptances with maturities not exceeding six months
and overnight bank deposits, in each case with any
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domestic commercial bank having capital and surplus in excess of $500.0 million
and a Thompson Bank Watch Rating of "B" or better, (iv) repurchase obligations
with a term of not more than seven days for underlying securities of the types
described in clauses (ii) and (iii) above entered into with any financial
institution meeting the qualifications specified in clause (iii) above and (v)
commercial paper having the highest rating obtainable from Moody's Investors
Service, Inc. or Standard & Poor's Corporation and in each case maturing within
270 days after the date of acquisition and (vi) money market funds at least 95%
of the assets of which constitute Cash Equivalents of the kinds described in
clauses (i) through (v) of this definition.
"Certificate of Designations" means this Certificate of Designations
setting forth the voting power, preferences and relative, participating,
optional and other special rights and qualifications, limitations and
restrictions of the Series B Preferred Stock.
"Certificated Shares" has the meaning set forth in Section 14(b).
"Change of Control" means the occurrence of any of the following: (i)
the sale, lease, transfer, conveyance or other disposition (or by way of merger
or consolidation), in one or a series of related transactions, of all or
substantially all of the assets of the Company and its Subsidiaries taken as a
whole to any "person" (as such term is used in Section 13(d)(3) of the Exchange
Act) other than the Principal or a Related Party of the Principal, (ii) the
adoption of a plan relating to the liquidation or dissolution of the Company,
(iii) the consummation of any transaction (including, without limitation, any
merger or consolidation) the result of which is that any "person" (as defined
above), other than the Principal and his Related Parties, becomes the
"Beneficial Owner," directly or indirectly, of more than 35% of the Voting Stock
of the Company, (iv) the Principal ceases to be the Beneficial Owner, directly
or indirectly, of a majority of the voting power of Voting Stock of the Company
(measured by voting power rather than number of shares) as a result of any
direct or indirect transfer of securities by the Principal, or (v) the first day
on which a majority of the members of the Board of Directors of the Company are
not Continuing Directors.
"Change of Control Offer" has the meaning set forth in Section 10(a).
"Change of Control Payment" has the meaning set forth in Section 10(a).
"Change of Control Payment Date" has the meaning set forth in Section
10(d).
"Company" means Spanish Broadcasting System, Inc., a Delaware
corporation, and any and all successors thereto.
"Company Notice" has the meaning set forth in Section 7(b).
"Consolidated Cash Flow" means, with respect to any Person for any
period, the Consolidated Net Income of such Person for such period plus, without
duplication, (i) an amount equal to any extraordinary loss plus any net loss
realized in connection with an Asset Sale, to the extent such losses were
deducted in computing such Consolidated Net Income, plus (ii) provision for
taxes based on income or profits of such Person and its Restricted Subsidiaries
for such period, to the extent that such provision for taxes was deducted in
computing such Consolidated Net Income, plus (iii) consolidated interest expense
of such Person and its Restricted Subsidiaries for such period, whether paid or
accrued and whether or not capitalized (including, without limitation,
amortization of debt issuance costs and original issue discount, non-cash
interest payments, the interest component of any deferred payment obligations,
the interest component of all payments associated with Capital Lease
Obligations, imputed interest with respect to Attributable Debt, commissions,
discounts and other fees and charges incurred in respect of
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letter of credit or bankers' acceptance financings, and net payments (if any)
pursuant to Hedging Obligations), to the extent that any such expense was
deducted in computing such Consolidated Net Income, plus (iv) depreciation
expense for such period, to the extent the same was deducted in computing such
Consolidated Net Income, plus (v) all amortization expense and other non-cash
expenses (excluding any such non-cash expense to the extent that it represents
an accrual of or reserve for cash expenses in any future period) for such
period, to the extent the same was deducted in computing such Consolidated Net
Income, minus (vi) non-cash items increasing such Consolidated Net Income for
such period.
Consolidated Cash Flow shall be calculated on a pro forma basis after
giving effect to any acquisition as if such acquisition (including any
Consolidated Cash Flow associated with such acquisition) occurred on the first
day of the most recently ended four quarter period, giving pro forma effect to
any non-recurring expenses, non-recurring costs and cost reductions within the
first year after such acquisition which the Company anticipates if the Company
delivers to the Transfer Agent an officer's certificate executed by its chief
financial or accounting officer certifying to and describing and quantifying
with reasonable specificity such non-recurring expenses, non-recurring costs and
cost reductions.
"Consolidated Indebtedness" means, with respect to any Person as of any
date of determination, the sum, without duplication, of (i) the total amount of
Indebtedness and Attributable Debt of such Person and its Restricted
Subsidiaries, plus (ii) the total amount of Indebtedness and Attributable Debt
of any other Person, to the extent that such Indebtedness or Attributable Debt
has been guaranteed by the referent Person or by one or more of its Restricted
Subsidiaries or is secured by a Lien on assets of the referent Person or any of
its Restricted Subsidiaries, plus (iii) the aggregate liquidation value of all
Disqualified Stock of such Person and all preferred stock of Restricted
Subsidiaries of such Person, in each case, determined on a consolidated basis in
accordance with GAAP.
"Consolidated Interest Expense" means, with respect to any Person for
any period, the sum of: (i) the consolidated interest expense of such Person and
its Restricted Subsidiaries for such period, whether paid or accrued (including,
without limitation, amortization of original issue discount, non-cash interest
payments, the interest component of any deferred payment obligations, the
interest component of all payments associated with Capital Lease Obligations,
imputed interest with respect to Attributable Debt, commissions, discounts and
other fees and charges incurred in respect of letters of credit or bankers'
acceptance financing, and net payments (if any) pursuant to Hedging
Obligations); and (ii) the consolidated interest expense of such Person and its
Restricted Subsidiaries that was capitalized during such period; and (iii) any
interest expense on Indebtedness or Attributable Debt of another Person that is
guaranteed by such Person or one of its Restricted Subsidiaries or secured by a
Lien on assets of such Person or one of its Restricted Subsidiaries (whether or
not such guarantee or Lien is called upon).
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its Subsidiaries for
such period, on a consolidated basis, determined in accordance with GAAP;
provided that (i) except as otherwise provided in clause (v) below, the positive
Net Income of any Person that is not a Restricted Subsidiary or that is
accounted for by the equity method of accounting shall be included only to the
extent of the amount of dividends or distributions paid in cash to the referent
Person or a Restricted Subsidiary thereof, (ii) the Net Income of any Restricted
Subsidiary shall be excluded to the extent that the declaration or payment of
dividends or similar distributions by that Restricted Subsidiary of that Net
Income is not at the date of determination permitted without any prior
governmental approval (that has not been obtained) or, directly or indirectly,
by operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Restricted Subsidiary or its stockholders, (iii) the Net Income of any Person
acquired in a pooling of interests transaction for any period prior to the date
of such acquisition shall be excluded, (iv) the cumulative effect of a change in
accounting principles shall be excluded and (v) the Net Income
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of any Unrestricted Subsidiary shall be excluded, whether or not distributed to
the Company or one of its Restricted Subsidiaries.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company who (i) was a member of such
Board of Directors on the Issue Date or (ii) was nominated for election or
elected to such Board of Directors with the approval of a majority of the
Continuing Directors who were members of such Board at the time of such
nomination or election.
"Credit Facility" or "Credit Facilities" means one or more debt
facilities (including, without limitation, the Senior Credit Facilities) or
commercial paper facilities with banks or other institutional lenders providing
for revolving credit loans, term loans, receivables financing (including through
the sale of receivables to such lenders or to special purpose entities formed to
borrow from such lenders against such receivables) or letters of credit, in each
case, as now in effect or at any time hereafter entered into and as amended,
restated, modified, renewed, refunded, replaced or refinanced in whole or in
part from time to time. Indebtedness under Credit Facilities outstanding on the
Issue Date shall be deemed to have been incurred on such date in reliance on the
exception provided by clause (i) of the definition of Permitted Debt.
"Debt to Cash Flow Ratio" means, with respect to any Person as of any
date of determination (the "Calculation Date"), the ratio of (a) the
Consolidated Indebtedness of such Person as of such date to (b) the Consolidated
Cash Flow of such Person for the four most recent full fiscal quarters ending
immediately prior to such date for which internal financial statements are
available, determined on a pro forma basis after giving effect to all
acquisitions and dispositions of assets made by such Person and its Restricted
Subsidiaries from the beginning of such four-quarter period through and
including such date of determination (including any related financing
transactions) as if such acquisitions and dispositions had occurred at the
beginning of such four-quarter period. For purposes of making the computation
referred to above, (i) acquisitions that have been made by such Person or any of
its Restricted Subsidiaries, including through mergers or consolidations and
including any related financing transactions, during the four-quarter reference
period or subsequent to such reference period and on or prior to the Calculation
Date shall be deemed to have occurred on the first day of the four-quarter
reference period and Consolidated Cash Flow for such reference period shall be
calculated without giving effect to clause (iii) of the proviso set forth in the
definition of Consolidated Net Income and (ii) the Consolidated Cash Flow
attributable to discontinued operations, as determined in accordance with GAAP,
and operations or businesses disposed of by the Company or any of its Restricted
Subsidiaries prior to the Calculation Date, shall be excluded.
"Disqualified Stock" means any Capital Stock (other than the Series A
Preferred Stock or the Series B Preferred Stock) that, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable at the option of the holder thereof), or upon the happening of any
event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder thereof,
in whole or in part, on or prior to the date that is 91 days after October 15,
2013, provided, however, that any Capital Stock that would constitute
Disqualified Stock solely because the holders thereof have the right to require
the Company to repurchase such Capital Stock upon the occurrence of a Change of
Control or an Asset Sale shall not constitute Disqualified Stock if the terms of
such Capital Stock provide that the Company may not repurchase or redeem any
such Capital Stock pursuant to such provisions unless such repurchase or
redemption complies with Section 11(b) hereof.
"Dividend Payment Date" has the meaning set forth in Section 4(a).
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"Dividend Shares" means shares of Series B Preferred Stock paid by the
Company to Holders of then outstanding shares of Series B Preferred Stock as
dividends on such outstanding shares in accordance with this Certificate of
Designations.
"DTC" has the meaning set forth in Section 14(a).
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Equity Offering" means (i) any public or private sale of the common
stock of the Company pursuant to which the Company receives net proceeds of at
least $15.0 million other than issuances of common stock of the Company pursuant
to employee benefits plans or as compensation to employees or (ii) the issuance
of shares of the Company's Class A common stock, par value $.0001 per share,
upon exercise of the warrants granted to International Church of the FourSquare
Gospel pursuant to which the Company receives net proceeds of at least $5.0
million.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Date" has the meaning set forth in Section 8(c).
"Exchange Indenture" has the meaning set forth in Section 8(a).
"Exchange Notes" means the Company's 10 3/4% Subordinated Exchange
Notes due 2013 issued in exchange for the Series A Preferred Stock and Series B
Preferred Stock, as the case may be.
"Exchange Notes Trustee" has the meaning set forth in Section 8(a).
"Exchange Notice" has the meaning set forth in Section 8(c).
"Existing Indebtedness" means Indebtedness in existence on the Issue
Date (other than Indebtedness under Credit Facilities), until such Indebtedness
is repaid.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect from time to time.
"Global Preferred Share" has the meaning set forth in Section 14(a).
"Global Restricted Share Legend" shall have the meaning set forth in
Section 14(a).
"Global Shares Legend" has the meaning set forth in Section 14(a).
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements and (ii) other
agreements or arrangements designed to protect such Person against fluctuations
in interest rates.
"Holder" means a holder in whose name a share of Series A Preferred
Stock or Series B Preferred Stock, as the case may be, is registered.
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"Holder Repurchase Notice" has the meaning set forth in Section 7(b).
"incur" has the meaning set forth in Section 11(b).
"Indebtedness" means, with respect to any Person, without duplication,
(i) any indebtedness of such Person, whether or not contingent, in respect of
borrowed money or evidenced by bonds, notes, debentures or similar instruments
or letters of credit (or reimbursement agreements in respect thereof) or
banker's acceptances or representing Capital Lease Obligations or the balance
deferred and unpaid of the purchase price of any property or representing any
Hedging Obligations, except any such balance that constitutes an accrued expense
or trade payable, if and to the extent any of the foregoing indebtedness (other
than letters of credit and Hedging Obligations) would appear as a liability upon
a balance sheet of such Person prepared in accordance with GAAP, (ii) all
indebtedness of others secured by a Lien on any asset of such Person (whether or
not such indebtedness is assumed by such Person) and (iii) to the extent not
otherwise included, the guarantee by such Person of any indebtedness of any
other Person of the sort described in clause (i) of this definition.
Notwithstanding the foregoing, the term "Indebtedness" shall not include
Non-Recourse Debt or indebtedness that constitutes "Indebtedness" merely by
virtue of a pledge of Equity Interests of an Unrestricted Subsidiary.
Furthermore, for the avoidance of doubt, "Indebtedness" shall not include any
Capital Stock or any liabilities in respect of Capital Stock. The amount of any
Indebtedness outstanding as of any date shall be (A) the accreted value thereof,
in the case of any Indebtedness issued with original issue discount, (B) the
principal amount of the Indebtedness secured, together with any interest thereon
that is more than 30 days past due, in the case of any Indebtedness of the type
described in clause (ii) above, (C) the principal amount of the Indebtedness
guaranteed, together with any interest thereon that is more than 30 days past
due, in the case of any Indebtedness of the type described in clause (iii)
above, (D) the amount of the net settlement payment payable on termination, in
the case of any Indebtedness constituting a Hedging Obligation (assuming for
this purpose that the Hedging Obligation was terminated on the date as of which
the calculation of the amount of Indebtedness is being made), and (E) the
principal amount thereof, together with any interest thereon that is more than
30 days past due, in the case of any other Indebtedness.
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including guarantees of Indebtedness or other obligations),
advances or capital contributions (excluding commission, travel and similar
advances to officers and employees made in the ordinary course of business),
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together with all items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP.
If the Company or any Subsidiary of the Company sells or otherwise disposes of
any Equity Interests of any direct or indirect Subsidiary of the Company such
that, after giving effect to any such sale or disposition, such Person is no
longer a Subsidiary of the Company, the Company shall be deemed to have made an
Investment on the date of any such sale or disposition equal to the fair market
value of the Equity Interests of such Subsidiary not sold or disposed of in an
amount determined as provided in the third paragraph of Section 11(a) hereof.
"Investments" does not include the defeasance, redemption or repurchase of
Indebtedness that is cancelled and not acquired or held as an investment.
"Issue Date" means October 30, 2003.
"Junior Securities" has the meaning set for in Section 3(a).
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or
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agreement to give any financing statement under the Uniform Commercial Code (or
equivalent statutes) of any jurisdiction).
"Liquidation Preference" means $1,000 per share of Series B Preferred
Stock.
"Net Income" means, with respect to any Person, the net income (loss)
of such Person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends, excluding, however, (i) any gain (but not
loss), together with any related provision for taxes on such gain (but not
loss), realized in connection with (a) any Asset Sale (including, without
limitation, dispositions pursuant to sale and leaseback transactions) or (b) the
disposition of any securities by such Person or any of its Restricted
Subsidiaries or the extinguishment of any Indebtedness of such Person or any of
its Restricted Subsidiaries and (ii) any extraordinary gain (but not loss),
together with any related provision for taxes on such extraordinary gain (but
not loss).
"Non-Guarantor Subsidiaries" means (i) those single-purpose Restricted
Subsidiaries of the Company created or acquired after the Issue Date which own
one or more FCC Licenses and related rights and no other material assets, (ii)
those Subsidiaries of the Company created or acquired after the Issue Date that
are not incorporated under the laws of the United States of America or a state
of the United States of America, and (iii) Subsidiaries of the Company that are
not required to become and are not guarantors of the Senior Subordinated Notes.
"Non-Recourse Debt" means Indebtedness: (i) as to which neither the
Company nor any of its Restricted Subsidiaries (a) provides credit support of
any kind (including any undertaking, agreement or instrument that would
constitute Indebtedness), (b) is directly or indirectly liable (as a guarantor
or otherwise) or (c) constitutes the lender; (ii) no default with respect to
which (including any rights that the holders thereof may have to take
enforcement action against an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other Indebtedness (other than
the Exchange Notes) of the Company or any of its Restricted Subsidiaries to
declare a default on such other Indebtedness or cause the payment thereof to be
accelerated or payable prior to its stated maturity; and (iii) as to which the
lenders have been notified in writing that they will not have any recourse to
the stock or assets of the Company or any of its Restricted Subsidiaries.
"Obligations" means any principal, interest, prepayment or make-whole
premium, penalties, fees, indemnifications, reimbursements, damages and other
liabilities payable under the documentation governing any Indebtedness or any
guarantee thereof.
"Officer" means, with respect to any Person, the Chairman of the Board,
the Chief Executive Officer, the President, the Chief Operating Officer, the
Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller,
the Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed by two officers at
least one of whom shall be the principal executive officer, principal accounting
officer or principal financial officer of the Company.
"Parity Securities" has the meaning set forth in Section 3(a).
"Paying Agent" means Wachovia Bank, National Association, a national
banking association, and its successors.
"Payment Default" has the meaning set forth in Section 9(b).
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"Permitted Business" means the media business and any business
reasonably similar, complementary, ancillary or related thereto, including, the
operation of Latin music Web sites and internet portals.
"Permitted Debt" has the meaning set forth in Section 11(b).
"Permitted Investments" means (i) any Investment in the Company or in a
Restricted Subsidiary; (ii) any Investment in Cash Equivalents; (iii) any
Investment by the Company or any Restricted Subsidiary of the Company in a
Person engaged in a Permitted Business, if (a) as a result of, or concurrently
with, such Investment such Person becomes a Restricted Subsidiary or (b) as a
result of, or concurrently with, such Investment such Person is merged,
consolidated or amalgamated with or into, or transfers or conveys substantially
all of its assets to, or is liquidated into, the Company or a Restricted
Subsidiary; or (c) the Company or a Restricted Subsidiary has entered into a
binding agreement to acquire such Person or all or substantially all of the
assets of such Person, which agreement is in effect on the date of such
Investment, and such Person becomes a Restricted Subsidiary or such transaction
is consummated, in each case, within 180 days of the date of such Investment;
(iv) any Restricted Investment made as a result of the receipt of non-cash
consideration from an Asset Sale; (v) any obligations or shares of Capital Stock
received in connection with or as a result of a bankruptcy, workout or
reorganization of the issuer of such obligations or shares of Capital Stock;
(vi) any Investment received involuntarily; (vii) any acquisition of assets
solely in exchange for the issuance of Equity Interests (other than Disqualified
Stock) of the Company; (viii) other Investments in Persons engaged in Permitted
Businesses (measured on the date each such Investment was made and without
giving effect to subsequent changes in value), when taken together with all
other Investments made pursuant to this clause (viii) that are at the time
outstanding, not to exceed $7.5 million; (ix) Investments by the Company or any
of its Restricted Subsidiaries in any other person pursuant to the terms of a
"local marketing agreement" or similar arrangement relating to a radio station
owned or licensed by such Person; (x) Hedging Obligations; (xi) the incurrence
by the Company or any of its Restricted Subsidiaries of performance, bid or
advance payment bonds, surety bonds, custom bonds, utility bonds and similar
obligations arising in the ordinary course of business; (xii) endorsements of
instruments for collection or deposit in the ordinary course of business; (xiii)
loans and advances to employees and officers not to exceed $2.5 million
outstanding in the aggregate at any time; (xiv) loans to employees, directors
and officers in connection with the purchase by such Persons of Equity Interests
of the Company; (xv) investments in account debtors received in connection with
the bankruptcy or reorganization, or in settlement of delinquent obligations, of
customers; and (xvi) investments in existence on the Issue Date.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Restricted Subsidiaries or any Disqualified Stock of the
Company issued in exchange for, or the net proceeds of which are used to extend,
refinance, renew, replace, defease or refund other Indebtedness of the Company
or any of its Restricted Subsidiaries; provided that: (i) the principal amount
(or accreted value or liquidation preference, if applicable) of such Permitted
Refinancing Indebtedness does not exceed the principal amount of (or accreted
value, if applicable), plus accrued interest on, the Indebtedness so extended,
refinanced, renewed, replaced, defeased or refunded (plus the amount of
reasonable expenses and premiums incurred in connection therewith); (ii) such
Permitted Refinancing Indebtedness has a final maturity date later than the
final maturity date of, and has a Weighted Average Life to Maturity equal to or
greater than the Weighted Average Life to Maturity of, the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; (iii) if the
Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded
is or would be pari passu with the Exchange Notes, such Permitted Refinancing
Indebtedness is or would be pari passu with or subordinated in right of payment
to the Exchange Notes or is Disqualified Stock; (iv) if the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded is or would be
subordinated in right of payment to the Exchange Notes, such Permitted
Refinancing Indebtedness is or would be subordinated in
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right of payment to the Exchange Notes on terms at least as favorable to the
Holders of Exchange Notes as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded
or is Disqualified Stock; and (v) such Indebtedness is incurred either by the
Company or by the Restricted Subsidiary that is the obligor on the Indebtedness
being extended, refinanced, renewed, replaced, defeased or refunded, or such
Disqualified Stock is issued by the Company, as applicable.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization, limited
liability company or government or any agency or political subdivision thereof
(including any subdivision or ongoing business of any such entity or
substantially all of the assets of such entity, subdivision or business).
"Principal" means Raul Alarcon, Jr.
"Purchase Date" has the meaning set forth in Section 7(a).
"Purchase Price" has the meaning set forth in Section 7(a).
"Purchase Money Indebtedness" means any Indebtedness incurred in the
ordinary course of business by a Person to finance the cost (including the cost
of construction) of an item of property, the principal amount of which
Indebtedness does not exceed the sum of (i) 100% of such cost and (ii)
reasonable fees and expenses of such Person incurred in connection therewith.
"Record Date" has the meaning set forth in Section 4(a).
"Redemption Date" has the meaning set forth in Section 6(c).
"Registration Default" has the meaning set forth in the Registration
Rights Agreement.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of October 30, 2003, by and among the Company, Lehman
Brothers Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated and Deutsche
Bank Securities Inc.
"Related Party" with respect to the Principal means (i) any spouse or
immediate family member of the Principal or (ii) any trust, corporation,
partnership or other entity, the beneficiaries, stockholders, partners, owners
or Persons beneficially holding an 50% or more controlling interest of which
consist of the Principal and/or such other Persons referred to in the
immediately preceding clause (i).
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Payment" has the meaning set forth in Section 11(a).
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
"SEC" means the Securities and Exchange Commission.
"Senior Credit Facilities" means the senior secured credit facilities
contemplated to be entered into among the Company, Lehman Brothers Inc., Lehman
Commercial Paper Inc., Merrill Lynch, Pierce Fenner & Smith Incorporated,
Deutsche Bank Securities Inc., Merrill Lynch Capital Corporation and
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Deutsche Bank Trust Company Americas, as amended, restated, modified, renewed,
refunded, replaced or refinanced in whole or in part from time to time.
"Senior Debt" means (i) all Indebtedness outstanding under Credit
Facilities and all Hedging Obligations with respect thereto, (ii) all
Indebtedness of the Company that is senior to Exchange Notes (including the
Senior Subordinated Notes), (iii) any other Indebtedness of the Company or any
Restricted Subsidiary permitted to be incurred under the terms of this
Cerificate of Designations, unless the instrument under which such Indebtedness
is incurred expressly provides that it is on a parity with or subordinated in
right of payment to the Exchange Notes and (iv) all Obligations of the Company
or any Restricted Subsidiary with respect to the foregoing. Notwithstanding
anything to the contrary in the foregoing, Senior Debt will not include (a) any
liability for federal, state, local or other taxes owed or owing by the Company,
(b) any Indebtedness of the Company or any Restricted Subsidiary to any of its
Subsidiaries or other Affiliates, (c) any trade payables or (d) any Indebtedness
that is incurred in violation of this Certificate of Designations; provided that
Indebtedness under Credit Facilities will not cease to be Senior Debt if
incurred based upon a written certificate from a purported officer of the
Company to the effect that such Indebtedness was permitted by this Certificate
of Designations to be incurred.
"Senior Subordinated Notes" mean the Company's 9 5/8% Senior
Subordinated Notes due 2009.
"Series A Preferred Stock" means the Company's 10 3/4% Series A
Cumulative Exchangeable Redeemable Preferred Stock, par value $.01 per share.
"Series B Preferred Stock" has the meaning set forth in Section 1(a).
"Significant Subsidiary" means any Restricted Subsidiary that would be
a "significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date hereof.
"Subsidiary" means, with respect to any Person, any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person (or a combination
thereof).
"Surviving Entity" has the meaning set forth in Section 11(c).
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA, except as provided by Section 9.03 hereof.
"Transfer Agent" means Wachovia Bank, National Association, a national
banking association, and its successors.
"Undesignated Shares" means shares of the preferred stock of the
Company which are authorized under its Certificate of Incorporation, are not
issued and outstanding, and have not been assigned to a series of preferred
stock.
"Unrestricted Subsidiary" means (i) any Subsidiary that is designated
by the Board of Directors as an Unrestricted Subsidiary pursuant to a resolution
of the Board of Directors, but only to the extent that such Subsidiary: (a) has
no Indebtedness other than Non-Recourse Debt; (b) is not party to any agreement,
contract, arrangement or understanding with the Company or any Restricted
Subsidiary unless the terms of any such agreement, contract, arrangement or
understanding are no less favorable to the
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Company or such Restricted Subsidiary than those that might be obtained at the
time from Persons who are not Affiliates of the Company; (c) is a Person with
respect to which neither the Company nor any of its Restricted Subsidiaries has
any direct or indirect obligation (1) to subscribe for additional Equity
Interests or (2) to maintain or preserve such Person's financial condition or to
cause such Person to achieve any specified levels of operating results; (d) has
not guaranteed or otherwise directly or indirectly provided credit support for
any Indebtedness of the Company or any of its Restricted Subsidiaries; and (e)
has at least one director on its board of directors that is not a director or
executive officer of the Company or any of its Restricted Subsidiaries and has
at least one executive officer that is not a director or executive officer of
the Company or any of its Restricted Subsidiaries.
"Voting Rights Amendment" means an amendment to the By-laws of the
Company providing for an increase in the size of the Board of Directors of the
Company to, at all times, accommodate the appointment of a sufficient number of
directors designated by the Holders of Series A Preferred Stock and Series B
Preferred Stock in compliance with Section 9(b).
"Voting Rights Triggering Event" has the meaning set forth in Section
9(b).
"Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (ii) the then outstanding principal
amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of such Person all of the outstanding Capital Stock or other
ownership interests of which (other than directors' qualifying shares) shall at
the time be owned by such Person or by one or more Wholly Owned Restricted
Subsidiaries of such Person and one or more Wholly Owned Restricted Subsidiaries
of such Person.
3. RANKING.
(a) The Series B Preferred Stock shall, with respect to dividend
distributions and distributions upon the liquidation,
winding-up and dissolution of the Company, rank (i) senior to
all classes of common stock of the Company and to each other
class of Capital Stock or series of preferred stock of the
Company created after the Issue Date by the Board of Directors
of the Company the terms of which do not expressly provide
that it ranks on a parity with the Series B Preferred Stock as
to dividend distributions and distributions upon the
liquidation, winding-up or dissolution of the Company
(collectively referred to, together with all classes of common
stock of the Company, as "Junior Securities"); and (ii)
subject to certain conditions described below, on a parity
with the Series A Preferred Stock and any Capital Stock or
each other series of preferred stock created after the Issue
Date by the Board of Directors of the Company, the terms of
which expressly provide that such class or series will rank on
a parity with the Series B Preferred Stock as to dividend
distributions and distributions upon the liquidation,
winding-up and dissolution of the Company (collectively
referred to as "Parity Securities").
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(b) The Company shall not authorize or issue any new class or
series of Parity Securities (or amend the provisions of any
existing class or series of Capital Stock of the Company to
make such class or series of Capital Stock Parity Securities)
without the affirmative vote or consent of the holders of at
least a majority of the shares of Series A Preferred Stock and
Series B Preferred Stock then outstanding, voting or
consenting, as the case may be, together as one class, in
accordance with Section 9(f); provided, however, that, without
the approval of Holders of the Series A Preferred Stock and
Series B Preferred Stock, the Company may (i) issue Dividend
Shares in accordance with the terms hereof, and (ii) issue and
have outstanding shares of Parity Securities issued from time
to time in exchange for, or the proceeds of which are used to
redeem or repurchase, any or all of the shares of the Series B
Preferred Stock or other Parity Securities then outstanding.
4. DIVIDENDS.
(a) The Holders of the outstanding shares of the Series B
Preferred Stock shall be entitled to receive, when, as and if
declared by the Board of Directors out of funds of the Company
legally available therefor, dividends on the Series B
Preferred Stock, which shall accrue at a rate per annum equal
to 10.75% of the Liquidation Preference. If at any time
dividends on the Series B Preferred Stock are in arrears and
unpaid for four consecutive quarterly dividend periods,
holders of Series B Preferred Stock will be entitled to the
voting rights specified in Section 9 of this Certificate of
Designations. All dividends will be cumulative, whether or not
earned or declared, on a daily basis, from the Issue Date and
will be payable quarterly in arrears on October 15, January
15, April 15 and July 15 of each year, commencing on January
15, 2004, or, if any such date is not a Business Day, on the
next succeeding Business Day (each a "Dividend Payment Date")
to the Holders on October 1, January 1, April 1 and July 1
immediately preceding the relevant Dividend Payment Date
(each, a "Record Date"). On or before October 15, 2008, the
Company may, at its option, pay dividends in cash or in
Dividend Shares (including fractional shares; provided that
the Company may, at its option, pay cash in lieu of issuing
fractional shares) having an aggregate Liquidation Preference
equal to the amount of such dividends. On or after October 15,
2008, dividends shall be paid only in cash. The issuance of
such Dividend Shares shall constitute "payment" of the related
dividend for all purposes of this Certificate of Designations.
Dividends payable on the Series B Preferred Stock will be
computed on the basis of a 360-day year consisting of twelve
30-day months and the number of days actually elapsed and will
be deemed to accrue on a daily basis.
(b) No full dividends shall be declared or paid or funds set apart
for the payment of dividends on any Parity Securities for any
period unless full cumulative dividends shall have been or
contemporaneously are declared and paid in full or declared
and, if payable in cash, a sum in cash sufficient for such
payment set apart for such payment on the Series B Preferred
Stock. If full dividends are not so paid, the Series B
Preferred Stock will share dividends pro rata with the Parity
Securities. Unless full cumulative dividends on all
outstanding shares of Series B Preferred Stock for all past
dividend periods shall have been declared and paid, or
declared and a sufficient sum for the payment thereof set
apart, then: (i) no dividend (other than a dividend on Junior
Securities payable solely in shares of any Junior Securities)
shall be declared or paid upon, or any sum set apart for the
payment of dividends upon, any shares of Junior Securities;
(ii) no shares of Junior Securities or Parity Securities shall
be repurchased, redeemed or otherwise acquired or retired by
the Company or any of its Subsidiaries hereof; and (iii) no
monies shall be paid into or set apart or made available for a
sinking or other like fund for the purchase,
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redemption or other acquisition or retirement for value of any
shares of Junior Securities or Parity Securities by the
Company or any of its Subsidiaries. Dividends on account of
arrears for any past dividend period and dividends in
connection with any optional redemption may be declared and
paid at any time, without reference to any regular Dividend
Payment Date, to holders of record of the Series B Preferred
Stock on such date, not more than 45 days prior to the payment
thereof, as may be fixed by the Board of Directors of the
Company.
5. LIQUIDATION PREFERENCE.
Upon any voluntary or involuntary liquidation, dissolution or
winding-up of the Company, Holders of Series B Preferred Stock shall be entitled
to payment, out of the assets of the Company available for distribution to
stockholders, the Liquidation Preference per share of Series B Preferred Stock,
plus, without duplication, an amount in cash equal to all accumulated and unpaid
dividends thereon to but excluding the date fixed for liquidation, dissolution
or winding-up (including an amount equal to a prorated dividend for the period
from the last Dividend Payment Date to the date fixed for liquidation,
dissolution or winding-up), before any distribution is made on any Junior
Securities, including, without limitation, common stock of the Company. If, upon
any voluntary or involuntary liquidation, dissolution or winding-up of the
Company, the amounts payable with respect to the Series B Preferred Stock and
all other Parity Securities are not paid in full, the Holders of the Series B
Preferred Stock and the Parity Securities shall share equally and ratably in any
distribution of assets of the Company in proportion to the full liquidation
preference to which each is entitled. After payment of the full amount of the
Liquidation Preference and accumulated and unpaid dividends to which they are
entitled, the Holders of shares of Series B Preferred Stock shall not be
entitled to any further participation in any distribution of assets of the
Company. However, neither the sale, conveyance, exchange or transfer (for cash,
shares of stock, securities or other consideration) of all or substantially all
of the property or assets of the Company nor the consolidation or merger of the
Company with or into one or more Persons shall be deemed to be a liquidation,
dissolution or winding-up of the Company, unless such sale, conveyance, exchange
or transfer shall be in connection with a liquidation, dissolution or winding-up
of the business of the Company.
6. OPTIONAL REDEMPTION BY THE COMPANY.
(a) The Series B Preferred Stock shall not be redeemed for cash at
the option of the Company prior to October 15, 2008. On or
after October 15, 2008, Series B Preferred Stock may be
redeemed (subject to contractual and other restrictions with
respect thereto, to the legal availability of funds therefor
and to Section 170 of the DGCL) at any time, in whole or from
time to time in part, at the option of the Company, at the
Applicable Redemption Price. In addition, at any time prior to
October 15, 2006, the Company may, at its option, redeem
shares of Series B Preferred Stock in whole or from time to
time in part having an aggregate Liquidation Preference of up
to 40% of the aggregate Liquidation Preference of the Series B
Preferred Stock (whether initially issued or issued as
Dividend Shares) from the net cash proceeds of one or more
Equity Offerings at a price equal to 110.75% of the aggregate
Liquidation Preference thereof, plus, without duplication, an
amount in cash equal to all accumulated and unpaid dividends,
if any, to but excluding the Redemption Date (including an
amount in cash equal to a prorated dividend for the period
from the Dividend Payment Date immediately prior to the
Redemption Date), subject to the right of Holders of record on
the relevant Record Date to receive dividends due on a
Dividend Payment Date; provided, that a number of shares
representing at least 60% of the aggregate Liquidation
Preference of the Series B Preferred Stock (whether initially
issued or issued as Dividend Shares) remains
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outstanding immediately following the occurrence of such
redemption and provided, further that, any such redemption
must be made within 90 days after the date of the closing of
such Equity Offerings.
(b) In the event of partial redemptions of Series B Preferred
Stock, the shares to be redeemed will be determined pro rata
or by lot, as determined by the Company; provided that the
Company may redeem such shares held by any holders of fewer
than 100 shares (or shares held by Holders who would hold less
than 100 shares as a result of such redemption), without
regard to any pro rata redemption requirement.
(c) Notice of any redemption shall be sent by or on behalf of the
Company not less than 30 nor more than 60 days prior to the
date specified for redemption in such notice (the "Redemption
Date"), by first class mail, postage prepaid, to all Holders
of record of the Series B Preferred Stock at their registered
address. In addition to any information required by law or by
the applicable rules of any exchange upon which Series B
Preferred Stock may be listed or admitted to trading, such
notice shall state: (i) the Redemption Date; (ii) the
redemption price; (iii) if less than all the outstanding
shares of Series B Preferred Stock are to be redeemed, the
Liquidation Preference of, and the accrued and unpaid
dividends on, the shares of Series B Preferred Stock to be
redeemed; (iv) that on the Redemption Date the redemption
price shall become due and payable upon each share of Series B
Preferred Stock to be redeemed; and (v) the place or places
where shares are to be surrendered for payment of the
redemption price. Upon the mailing of any such notice of
redemption, the Company shall become obligated to redeem at
the time of redemption specified thereon all shares called for
redemption.
(d) If notice has been mailed in accordance with Section 6(c)
above and, provided that on or before the Redemption Date
specified in such notice, all funds necessary for such
redemption shall have been segregated and irrevocably set
apart by the Company, in trust for the pro rata benefit of the
Holders of the shares so called for redemption, so as to be,
and to continue to be available therefor, then, on and after
the Redemption Date, unless the Company defaults in the
payment of the applicable redemption price, dividends on the
shares of the Series B Preferred Stock so called for
redemption shall cease to accumulate and all rights of the
Holders of such shares shall terminate except for the right to
receive from the Company the redemption price, without
interest; provided, however, that if a notice of redemption
shall have been given and the funds necessary for redemption
(including an amount in respect of all dividends that will
accrue to the Redemption Date) shall have been segregated and
irrevocably set apart by the Company, in trust for the pro
rata benefit of the Holders of the shares called for
redemption, dividends shall cease to accumulate on the
Redemption Date on the shares to be redeemed and, at the close
of business on the day on which such funds are segregated and
set apart, such shares of Series B Preferred Stock shall no
longer be deemed to be outstanding and the Holders of the
shares to be redeemed shall cease to be stockholders of the
Company and shall be entitled only to receive the redemption
price for such shares. New certificates of Series B Preferred
Stock having an aggregate Liquidation Preference equal to the
unredeemed portion of the Series B Preferred Stock shall be
issued in the name of the Holder thereof upon cancellation of
the original shares of Series B Preferred Stock without cost
to the Holder thereof. Upon surrender, in accordance with said
notice, of the certificates for any shares so redeemed
(properly endorsed or assigned for transfer, if the Company
shall so require and the notice shall so state), such shares
shall be redeemed by the Company at the applicable redemption
price. Shares of Series B Preferred Stock issued and
reacquired by the Company pursuant to this Section 6 shall,
-16-
upon compliance with the applicable requirements of Delaware
law, have the status of Undesignated Shares of the Company,
and may, with any and all other Undesignated Shares of the
Company, be designated or redesignated, and issued or
reissued, as the case may be, as part of any series of
preferred stock of the Company, except that any issuance or
reissuance of shares of Series B Preferred Stock must be in
compliance with this Certificate of Designations.
(e) Any deposit of funds with a bank or trust company for the
purpose of redeeming Series B Preferred Stock shall be
irrevocable except that:
(i) the Company shall be entitled to receive from such
bank or trust company the interest or other earnings,
if any, earned on any money so deposited in trust,
and the Holders of any shares redeemed shall have no
claim to such interest or other earnings; and
(ii) any balance of monies so deposited by the Company and
unclaimed by the Holders of the Series B Preferred
Stock entitled thereto at the expiration of two years
from the applicable Redemption Date shall be repaid,
together with any interest or other earnings earned
thereon, to the Company, and after any such
repayment, the holders of the shares entitled to the
funds so repaid to the Company shall look only to the
Company for payment without interest or other
earnings.
(f) No Series B Preferred Stock may be redeemed except with funds
legally available for the purpose. The Company shall take all
actions required or permitted under the DGCL to permit any
redemption which the Company elects pursuant to clause (a)
above.
(g) No optional redemption may be authorized or made (i) unless
prior thereto or contemporaneously therewith full unpaid
cumulative dividends shall have been paid or a sum set apart
for such payment on the Series B Preferred Stock or (ii) at a
price less than 101% of the Liquidation Preference of the
Series B Preferred Stock at any time when the company is
making an offer to purchase shares of Series B Preferred Stock
under a Change of Control Offer in accordance with Section 10.
7. REPURCHASE AT THE OPTION OF HOLDER
(a) On October 15, 2013 (the "Purchase Date"), each Holder of
shares of Series B Preferred Stock will have the right to
require the Company to repurchase (subject to the legal
availability of funds therefor and to Section 170 of the DGCL)
all or a portion of the Series B Preferred Stock held by such
Holder at a purchase price equal to 100% of the Liquidation
Preference thereof, plus all accumulated and unpaid dividends
to the date of repurchase (the "Purchase Price"), in
accordance with the procedures set forth below.
(b) The Company shall give notice (the "Company Notice") not less
than 30 days and not more than 60 days before the Purchase
Date by first class mail, postage prepaid, to all Holders of
record of the Series B Preferred Stock at their registered
address. In addition to any information required by law or by
the applicable rules of any exchange upon which Series B
Preferred Stock may be listed or admitted to trading, such
Company Notice shall state: (i) the Purchase Date and the
Purchase Price, (ii) that any Holder who elects to have the
Company repurchase any shares of Series B Preferred Stock held
by such Holder must complete and sign the notice (the "Holder
Repurchase Notice") that the
-17-
Company shall include with the Company Notice and surrender
any such shares of Series B Preferred Stock to the Paying
Agent, (iii) that the Holder Repurchase Notice may be
withdrawn prior to the close of business on the Purchase Date
by delivering a written notice of withdrawal in accordance
with this Section 7, and (iv) that the repurchase right
described in this Section 7 is the only such right of Holders
to elect to have the Company repurchase such Holder's Series B
Preferred Stock and Holders that do not elect to have the
Company repurchase their shares of Series B Preferred Stock or
withdraw such election will have no other such right.
(c) The Holder Repurchase Notice shall: (i) identify the Series B
Preferred Stock to be delivered by the Holder thereof for
repurchase by the Company and (ii) state, if a Holder elects
to have only a portion of the shares of Series B Preferred
Stock held by such Holder, the number of shares to be
repurchased.
(d) Any notice of withdrawal shall: (i) identify the shares of
Series B Preferred Stock in respect of which such notice of
withdrawal is being delivered, (ii) state the number of shares
of Series B Preferred Stock with respect to which such notice
of withdrawal is being submitted, and (iii) state the number
of shares of Series B Preferred Stock which shall remain
subject to the Purchase Notice.
(e) If on or prior to the Purchase Date, all funds necessary for
any repurchases to be made on the Purchase Date shall have
been segregated and irrevocably set apart by the Company, in
trust for the benefit of the Holders of the shares of Series B
Preferred Stock that have delivered and not withdrawn a Holder
Repurchase Notice to the Company, so as to be, and to continue
to be available therefor, then, on and after the Purchase
Date, unless the Company defaults in the payment of the
applicable Purchase Price, dividends on the shares of the
Series B Preferred Stock to be repurchased shall cease to
accumulate and all rights of the Holders of such shares shall
terminate except for the right to receive from the Company the
Purchase Price, without interest; provided, however, that if
the funds necessary for repurchase pursuant to this Section 7
(including an amount in respect of all dividends that will
accrue to the Purchase Date) shall have been segregated and
irrevocably set apart by the Company, in trust for the benefit
of the Holders of the shares to be repurchased, dividends
shall cease to accumulate on the Purchase Date on the shares
to be repurchased and, at the close of business on the day on
which such funds are segregated and set apart, such shares of
Series B Preferred Stock shall no longer be deemed to be
outstanding and the Holders of the shares to be repurchased
shall cease to be stockholders of the Company and shall be
entitled only to receive the Purchase Price for such shares.
New certificates of Series B Preferred Stock having an
aggregate Liquidation Preference equal to the unpurchased
portion of the Series B Preferred Stock shall be issued in the
name of the Holder thereof upon cancellation of the original
shares of Series B Preferred Stock without cost to the Holder
thereof. Upon surrender, in accordance with the provisions of
this Section 7, of the certificates for any shares so
repurchased (properly endorsed or assigned for transfer, if
the Company shall so require), such shares shall be
repurchased by the Company at the Purchase Price. Shares of
Series B Preferred Stock issued and reacquired by the Company
pursuant to this Section 7 shall, upon compliance with the
applicable requirements of Delaware law, have the status of
Undesignated Shares of the Company, and may, with any and all
other Undesignated Shares of the Company, be designated or
redesignated, and issued or reissued, as the case may be, as
part of any series of preferred stock of the Company, except
that any issuance or reissuance of shares of Series B
Preferred Stock must be in compliance with this Certificate of
Designations.
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(f) Any deposit of funds with a bank or trust company for the purpose of
repurchasing Series B Preferred Stock pursuant to this Section 7
shall be irrevocable except that:
(i) the Company shall be entitled to receive from such bank or
trust company the interest or other earnings, if any, earned
on any money so deposited in trust, and the Holders of any
shares repurchased shall have no claim to such interest or
other earnings;
(ii) the Company shall be entitled to receive from such bank or
trust company the amount of any funds deposited with respect
to shares of Series B Preferred Stock for which the Company
has received a valid notice of withdrawal; and
(iii) any balance of monies so deposited by the Company and
unclaimed by the Holders of the Series B Preferred Stock
entitled thereto at the expiration of two years from the
Purchase Date shall be repaid, together with any interest or
other earnings earned thereon, to the Company, and after any
such repayment, the holders of the shares entitled to the
funds so repaid to the Company shall look only to the Company
for payment without interest or other earnings.
(g) No Series B Preferred Stock may be repurchased except with funds
legally available for the purpose. The Company shall take all
actions required or permitted under the DGCL to permit any
repurchase pursuant to this Section 7.
(h) Payments of the Purchase Price shall only be made after delivery of
a Purchase Notice and surrender of the applicable shares of Series B
Preferred Stock (together with necessary endorsements) to the Paying
Agent. Payment of the Purchase Price shall be made promptly
following the later of the Purchase Date and the time of delivery of
shares of Series B Preferred Stock for surrender.
8. EXCHANGE OF SERIES B PREFERRED STOCK FOR EXCHANGE NOTES.
(a) The Company may at its option, on any scheduled Dividend Payment
Date prior to October 15, 2013, exchange all but not less than all
of the then outstanding shares of Series B Preferred Stock for the
Exchange Notes to be issued under an indenture (the "Exchange
Indenture") in the form attached hereto as Exhibit A to be entered
into between the Company and Wachovia Bank, National Association
(the "Exchange Notes Trustee"); provided, that on the date of such
exchange: (i) there are no contractual impediments to such exchange;
(ii) such exchange would comply with the DGCL; (iii) immediately
after giving effect to such exchange, no Default or Event of Default
(each as defined in the Exchange Indenture) would exist under the
Exchange Indenture and no default or event of default would exist
under the Senior Credit Facilities, the indenture for the Senior
Subordinated Notes, or any other material instrument governing
Indebtedness outstanding at the time; (iv) the Company has paid all
accumulated dividends on the Series B Preferred Stock (including the
dividends payable on the date of Exchange Date); (v) the Exchange
Indenture has been qualified under the TIA, to the extent such
qualification is necessary at the time of the exchange and (vi) the
Company shall have delivered to the Transfer Agent and the Exchange
Notes Trustee a written opinion of counsel, dated the date of
exchange, as to the due authorization, execution and delivery and
enforceability of the Exchange Notes Indenture and the Exchange
Notes and to the effect that all conditions to be satisfied prior to
such exchange have been satisfied.
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(b) Upon any exchange of Series B Preferred Stock for Exchange Notes on
the Exchange Date pursuant to clause (a) of this Section 8, Holders
of outstanding shares of Series B Preferred Stock shall be entitled
to receive, subject to the second succeeding sentence, $1.00 of
principal amount of Exchange Notes for each $1.00 of the Liquidation
Preference of Series B Preferred Stock held by them. The Exchange
Notes shall be issued in registered form, without coupons. Exchange
Notes issued in exchange for Series B Preferred Stock shall be
issued in principal amounts of $1,000 and integral multiples
thereof; provided, that the Company may issue Exchange Notes in
principal amounts of less than $1,000 to the extent necessary so
that each Holder of Series B Preferred Stock shall receive Exchange
Notes in a principal amount equal to the amount to which such
Holder's shares of Series B Preferred Stock entitle such Holder; and
provided, further that the Company, at its option, may pay cash in
lieu of issuing an Exchange Note in a principal amount less than
$1,000. On and after the Exchange Date, provided that the conditions
of Section 8(a)(i)-(vi) and 8(f) have been satisfied, dividends will
cease to accumulate on the outstanding shares of Series B Preferred
Stock, and all rights of the Holders of Series B Preferred Stock
(except the right to receive the Exchange Notes, an amount in cash,
to the extent applicable, equal to the accumulated and unpaid
dividends to the Exchange Date and if the Company so elects, cash in
lieu of any Exchange Note that is in a principal amount less than
$1,000) shall terminate. The person entitled to receive the Exchange
Notes issuable upon such exchange shall be treated for all purposes
as the registered holder of such Exchange Notes.
(c) The Company shall send a written notice (the "Exchange Notice") of
exchange by mail to each Holder of record of Series B Preferred
Stock, which notice shall state: (i) that the Company is exercising
its option to exchange the Series B Preferred Stock for Exchange
Notes pursuant to this Certificate of Designations; (ii) the date
fixed for exchange (the "Exchange Date"), which date shall not be
less than 30 days nor more than 60 days following the date on which
the Exchange Notice is mailed; (iii) that the Holder is to surrender
to the Company, at the place or places where shares of Series B
Preferred Stock are to be surrendered for exchange in the manner
designated in the Exchange Notice, the shares of Series B Preferred
Stock to be exchanged; (iv) that dividends on the shares of Series B
Preferred Stock to be exchanged shall cease to accrue on the
Exchange Date whether or not the shares of Series B Preferred Stock
are surrendered for exchange on the Exchange Date unless the Company
shall default in the delivery of Exchange Notes; and (v) that
interest on the Exchange Notes shall accrue from the Exchange Date
whether or not the shares of Series B Preferred Stock are
surrendered for exchange on the Exchange Date. On the Exchange Date,
if the conditions set forth in Sections 8(a)(i) through 8(a)(vi)
above and Section 8(f) below are satisfied, the Company shall issue
Exchange Notes in exchange for the Series B Preferred Stock as
provided in this Section 8.
(d) A Holder delivering Series B Preferred Stock for exchange shall not
be required to pay any taxes or duties in respect of the issue or
delivery of Exchange Notes on exchange but shall be required to pay
any tax or duty that may be payable in respect of any transfer
involved in the issue or delivery of the Exchange Notes in a name
other than that of the Holder of the Series B Preferred Stock.
Certificates representing Exchange Notes shall not be issued or
delivered unless all taxes and duties, if any, payable by the Holder
have been paid.
(e) On or before the Exchange Date, each Holder of Series B Preferred
Stock shall surrender the shares of Series B Preferred Stock, in the
manner and at the place designated in the Exchange Notice. The
Company shall cause the Exchange Notes to be executed on the
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Exchange Date and, upon surrender, in accordance with the Exchange
Notice, of the shares of Series B Preferred Stock so exchanged
(properly endorsed or assigned for transfer, if the notice shall so
state), such shares shall be exchanged by the Company for Exchange
Notes. The Company shall pay dividends, if any, on the Exchange
Notes at the rate and on the dates specified therein from the
Exchange Date.
(f) After the Exchange Notice has been mailed in accordance with Section
8(c), the conditions set forth in Section 8(a)(i) through 8(a)(vi)
have been satisfied, and before the Exchange Date (i) the Exchange
Indenture shall have been duly executed and delivered by the Company
and the Exchange Notes Trustee; (ii) all Exchange Notes necessary
for such exchange shall have been duly executed and authenticated by
the Company and delivered to the Exchange Notes Trustee with
irrevocable instructions to authenticate the Exchange Notes
necessary for such exchange; and (iii) an amount in cash, set aside
by the Company, separate and apart from its other funds in trust, or
additional Series B Preferred Stock (as applicable) equal to all
accumulated and unpaid dividends thereon to the Exchange Date shall
have been deposited with the Exchange Notes Trustee, then on and
after the close of business on the Exchange Date, dividends on the
shares of Series B Preferred Stock so exchanged shall cease to
accumulate, such shares of Series B Preferred Stock shall no longer
be deemed to be outstanding and all rights of the Holders of such
shares shall terminate except for the right to receive from the
Company the Exchange Notes, cash, if any, and all accrued interest,
if any, thereon to the Exchange Date. Shares of Series B Preferred
Stock issued and reacquired by the Company pursuant to this Section
8 shall, upon compliance with the applicable requirements of
Delaware law, have the status of Undesignated Shares of the Company,
and may, with any and all other authorized but unissued Undesignated
Shares of the Company, be designated or redesignated, and issued or
reissued, as the case may be, as part of any series of preferred
stock of the Company, but not as Series B Preferred Stock.
(g) The Company shall comply with the provisions of Rule 13e-4
promulgated pursuant to the Exchange Act in connection with any
exchange, to the extent applicable.
9. VOTING RIGHTS.
(a) The Holders of shares of the Series B Preferred Stock shall have no
voting rights, except as required by non-waivable provisions of
Delaware law and as hereinafter provided in this Section 9. It is
the intention of this Section 9(a) to deny voting rights to holders
of shares of Series B Preferred Stock except (i) as specifically
granted in Sections 9(b) through 9(i), and (ii) to the extent that
non-waivable provisions of Delaware law preclude the denial of
voting rights to holders of shares of Series B Preferred Stock.
(b) If:
(i) at any time, dividends on the outstanding Series B Preferred
Stock are in arrears and unpaid (and in the case of dividends
payable after October 15, 2008, are not paid in cash) for four
(4) consecutive quarterly dividend periods;
(ii) the Company fails to discharge any redemption or repurchase
obligation with respect to the Series B Preferred Stock
(whether or not the Company is permitted to do so by the terms
of the Senior Credit Facilities, the Senior Subordinated
Notes, the DGCL, or any other obligation of the Company);
-21-
(iii) the Company fails to make a Change of Control Offer on the
terms and in accordance with the provisions described below in
Section 10 hereof (whether or not the Company is permitted to
do so by the terms of the Senior Credit Facilities, the Senior
Subordinated Notes or any other obligation of the Company) or
fails to purchase shares of Series B Preferred Stock from
Holders who elect to have such shares purchased pursuant to
the Change of Control Offer;
(iv) the Company breaches or violates any of the other covenants or
agreements set forth in Section 11 and such breach or
violation continues for a period of 60 days or more after the
Company receives notice thereof specifying the default from
the Holders of at least 25% of the shares of Series B
Preferred Stock then outstanding; or
(v) the Company or any Significant Subsidiary defaults under the
terms of any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company
or any of its Significant Subsidiaries (or the payment of
which is guaranteed by the Company or any of its Significant
Subsidiaries) whether such Indebtedness or guarantee now
exists, or is created after the Issue Date, which default (A)
is caused by a failure to pay principal of or premium, if any,
or interest on such Indebtedness prior to the expiration of
the grace period provided in such Indebtedness on the date of
such default (a "Payment Default") or (B) results in the
acceleration of such Indebtedness prior to its express
maturity and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other
such Indebtedness under which there is then existing a Payment
Default or the maturity of which has been so accelerated,
aggregates $5.0 million or more (each of the events described
in clauses (i), (ii), (iii), (iv) and (v) being referred to
herein as a "Voting Rights Triggering Event"); then, in each
case, the number of directors constituting the Board of
Directors of the Company will be adjusted to permit the
holders of the majority of the then outstanding Series A
Preferred Stock and Series B Preferred Stock, voting together
as one class, to elect two directors.
(c) Whenever the foregoing voting rights shall have vested, such rights
may be exercised initially either at a special meeting of the
Holders of Series A Preferred Stock and Series B Preferred Stock,
called as hereinafter provided, or at any annual meeting of
stockholders held for the purpose of electing directors, and
thereafter at such annual meetings or by the written consent of the
Holders of Series A Preferred Stock and Series B Preferred Stock.
Such right of the Holders of Series A Preferred Stock and Series B
Preferred Stock to elect directors may be exercised until (i) all
dividends in arrears shall have been paid in full (and in the case
of dividends payable after October 15, 2008, paid in cash) and (ii)
all other failures, breaches or defaults giving rise to such Voting
Rights Triggering Event are remedied or waived by the Holders of at
least a majority of the shares of the then outstanding Series A
Preferred Stock and Series B Preferred Stock, taken together, at
which time the term of such directors previously elected pursuant to
the provisions of this Section 7(c) shall thereupon terminate, and
such directors shall be deemed to have resigned.
(d) At any time when the foregoing voting rights shall have vested in
the Holders of Series A Preferred Stock and Series B Preferred Stock
and if such rights shall not already have
-22-
been initially exercised, a proper officer of the Company shall,
upon the written request of Holders of record of 10% or more of the
then outstanding Series A Preferred Stock and Series B Preferred
Stock, taken together, addressed to the Secretary of the Company,
call a special meeting of Holders of Series A Preferred Stock and
Series B Preferred Stock. Such meeting shall be held at the earliest
practicable date based upon the number of days of notice required
for annual meetings of stockholders at the place for holding annual
meetings of stockholders of the Company or, if none, at a place
designated by the Secretary of the Company. If such meeting shall
not be called by the proper officers of the Company within 30 days
after the personal service of such written request upon the
Secretary of the Company, or within 30 days after mailing the same
within the United States, by registered mail, addressed to the
Secretary of the Company at its principal office (such mailing to be
evidenced by the registry receipt issued by the postal authorities),
then the Holders of record of 10% of the shares of the then
outstanding Series A Preferred Stock and Series B Preferred Stock,
taken together, may designate in writing a Holder of Series B
Preferred Stock or Series B Preferred Stock to call such meeting at
the expense of the Company, and such meeting may be called by such
person so designated upon the number of days of notice required for
annual meetings of stockholders and shall be held at the place for
holding annual meetings of the Company or, if none, at a place
designated by such Holder. Any Holder of Series B Preferred Stock
that would be entitled to vote at such meeting shall have access to
the stock books of the Company for the purpose of causing a meeting
of stockholders to be called pursuant to the provisions of this
Section 9. Notwithstanding the provisions of this Section 9(d)
however, no such special meeting shall be called if any such request
is received less than 90 days before the date fixed for the next
ensuing annual meeting of stockholders.
(e) If any director so elected by the Holders of Series A Preferred
Stock and Series B Preferred Stock shall cease to serve as a
director before his term shall expire, the Holders of the then
outstanding Series A Preferred Stock and Series B Preferred Stock,
voting together as one class, may, at a special meeting of the
Holders called as provided above, elect a successor to hold office
for the unexpired term of the director whose place shall be vacant.
(f) The Company shall not, without the affirmative vote or consent of
the Holders of at least a majority of the shares of Series A
Preferred Stock and Series B Preferred Stock then outstanding (with
shares held by the Company or any of its Affiliates not being
considered to be outstanding for this purpose) voting or consenting,
as the case may be, together as one class (i) merge, consolidate or
sell all or substantially all of the assets of the Company except as
permitted pursuant to Section 11(c) or (ii) authorize or issue any
new class or series of Parity Securities (or amend the provisions of
any existing class or series of Capital Stock to make such class of
Capital Stock Parity Securities); provided, however, that, without
the approval of Holders of the Series A Preferred Stock and Series B
Preferred Stock, the Company may (A) issue Dividend Shares in
accordance with the terms hereof, and (B) issue and have outstanding
shares of Parity Securities issued from time to time in exchange
for, or the proceeds of which are used to redeem or repurchase, any
or all of the shares of the Series B Preferred Stock or other Parity
Securities then outstanding.
(g) In addition to the matters set forth in clause (f) above, except as
stated above under Section 3, the Company shall not, without the
affirmative vote or consent of holders of at least a majority of the
shares of Series B Preferred Stock then outstanding (with shares
-23-
held by the Company or any of its Affiliates not being considered to
be outstanding for this purpose), voting or consenting, as the case
may be, as one class:
(i) amend the Certificate of Designations so as to adversely
affect the specified rights, preferences, privileges or voting
rights of holders of shares of the Series B Preferred Stock
(including any rights set forth in the Exchange Indenture), or
(ii) increase the number of authorized shares of the Company
designated as Series B Preferred Stock.
(h) Without the consent of each Holder affected, an amendment or waiver
of the Company's Certificate of Incorporation or of this Certificate
of Designations may not (with respect to any shares of Series B
Preferred Stock held by a non-consenting Holder):
(i) alter the voting rights with respect to the Series B Preferred
Stock (provided, however, that the consent of Holders of
Series B Preferred Stock shall not be required to approve the
Voting Rights Amendment) or reduce the number of shares of
Series B Preferred Stock whose holders must consent to an
amendment, supplement or waiver;
(ii) reduce the Liquidation Preference of or change the Purchase
Date of any share of Series B Preferred Stock or alter the
provisions with respect to the redemption of the Series B
Preferred Stock (except as provided with respect to Section 10
hereof);
(iii) reduce the rate or change the time for payment of dividends on
any share of Series B Preferred Stock;
(iv) waive the consequences of any failure to pay dividends on the
Series B Preferred Stock;
(v) make any share of Series B Preferred Stock payable in any form
other than that stated in this Certificate of Designations;
(vi) make any change in the provisions of this Certificate of
Designations relating to waivers of the rights of holders of
Series B Preferred Stock to receive the Liquidation Preference
and dividends on the Series B Preferred Stock;
(vii) waive a redemption payment with respect to any share of Series
B Preferred Stock (except as provided with respect to Section
10 hereof); or
(viii) make any change in the foregoing amendment and waiver
provisions.
(i) The Company in its sole discretion may, without the vote or consent
of any Holders of the Series B Preferred Stock, amend or supplement
this Certificate of Designations:
(i) to cure any ambiguity, defect or inconsistency;
(ii) except as set forth in clauses (f) and (g) above, create,
authorize or issue any shares of Junior Securities or Parity
Securities;
-24-
(iii) to decrease the amount of authorized capital stock of any
class, including any Series B Preferred Stock;
(iv) to increase the amount of authorized capital stock of any
class of Junior Securities; or
(v) to make any change that would provide any additional rights or
benefits to the Holders of the Series B Preferred Stock or
that does not adversely affect the legal rights under this
Certificate of Designations (including the Exchange Indenture)
of any such Holder.
10. CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, the Company shall make
an offer (the "Change of Control Offer") to each Holder of shares of
Series B Preferred Stock to repurchase all or any part (but not, in
the case of any Holder requiring the Company to purchase less than
all of the shares of Series B Preferred Stock held by such Holder,
any fractional shares) of such Holder's Series B Preferred Stock at
an offer price in cash equal to 101% of the aggregate Liquidation
Preference thereof plus, without duplication, an amount in cash
equal to all accumulated and unpaid dividends (including an amount
in cash equal to a pro rata dividend for the period from the
Dividend Payment Date immediately prior to the Change of Control
Date), if any, thereon to but excluding the date of purchase (the
"Change of Control Payment") (subject to the right of Series B
Preferred Stock Holders of record on the relevant Record Date to
receive dividends due on the relevant Dividend Payment Date);
provided, however, that notwithstanding the occurrence of a Change
of Control, the Company shall not be obligated to purchase the
Series B Preferred Stock pursuant to this Section 10 in the event
that it has exercised its right to redeem all of the Series B
Preferred Stock pursuant to Section 7(b).
(b) The Change of Control Offer shall include all instructions and
materials necessary to enable Holders to tender their shares of
Series B Preferred Stock and a full description of the circumstances
and relevant facts and financial information regarding such Change
of Control.
(c) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other
securities laws and regulations in connection with the repurchase of
the Series B Preferred Stock as a result of a Change of Control. To
the extent that the provisions of any securities laws or regulations
conflict with provisions of this Section 10, the Company will comply
with the applicable securities laws and regulations and will not be
deemed to have breached its obligations under this paragraph by
virtue thereof. The Change of Control Offer shall contain
information concerning the business of the Company and its
Subsidiaries which the Company in good faith believes will enable
such Holders to make an informed decision with respect to the Change
of Control Offer (which at a minimum will include (i) the most
recent annual and quarterly financial statements, (ii) a description
of material developments in the Company's business subsequent to the
date of the latest of such financial statements referred to in
clause (i) (including a description of the events requiring the
Company to make the Change of Control Offer) and (iii) if
applicable, appropriate pro forma financial information concerning
the Offer to Purchase).
-25-
(d) Within 30 days following any Change of Control (or at the Company's
option, prior to such Change of Control but after the public
announcement thereof), the Company shall mail a notice to each
Holder stating:
(i) that a Change of Control has occurred or will occur (and
describing the transaction or transactions that constitute
such Change of Control) and that the Change of Control Offer
is being made pursuant to this Section 10 and that all shares
of Series B Preferred Stock tendered shall be accepted for
payment;
(ii) the amount of the Change of Control Payment and the purchase
date, which shall be not earlier than 30 days nor later than
60 days from the date such notice is mailed (the "Change of
Control Payment Date");
(iii) that any share of Series B Preferred Stock not tendered shall
continue to accumulate dividends;
(iv) the place or places where Series B Preferred Stock are to be
surrendered for tender pursuant to the Change of Control
Offer;
(v) that, on the Change of Control Payment Date, the purchase
price shall become due and payable upon each share of Series B
Preferred Stock accepted for payment pursuant to the Change of
Control Offer and, unless the Company fails to pay the Change
of Control Payment on the Change of Control Payment Date, all
shares of Series B Preferred Stock accepted for payment
pursuant to the Change of Control Offer shall cease to
accumulate dividends after the Change of Control Payment Date;
(vi) that Holders electing to have any shares of Series B Preferred
Stock purchased pursuant to a Change of Control Offer will be
required to surrender the shares of Series B Preferred Stock,
with the form entitled "Option of Holder to Elect Purchase"
which shall be included with the notice of Change of Control
completed, to the Paying Agent at the address specified in the
notice prior to the close of business on the third Business
Day preceding the Change of Control Payment Date;
(vii) that, if such Offer is made prior to such Change of Control,
payment is conditioned on the occurrence of such Change of
Control; and
(viii) that the Holder may tender all or any portion of the shares
of Series B Preferred Stock held by such Holder and that in
the case of any Holder whose shares are to be purchased only
in part, the Company shall execute, authorize and deliver to
the Holder, without service charge, a new certificate as
requested by such Holder, for the unpurchased portion of his
shares of Series B Preferred Stock.
(e) On the Change of Control Payment Date, the Company shall, to the
extent lawful, (i) accept for payment all shares of Series B
Preferred Stock or portions thereof properly tendered pursuant to
the Change of Control Offer, (ii) deposit with the Paying Agent an
amount equal to the Change of Control Payment in respect of all
shares of Series B Preferred Stock or portions thereof so tendered
and (iii) deliver or cause to be delivered to the Transfer Agent the
shares of Series B Preferred Stock so accepted together with an
Officers' Certificate stating the aggregate Liquidation Preference
of the shares of Series
-26-
B Preferred Stock or portions thereof being purchased by the
Company. The Paying Agent shall promptly mail to each holder of
Series B Preferred Stock so tendered the Change of Control Payment
for such Series B Preferred Stock, and the Transfer Agent shall
promptly authenticate and mail (or cause to be transferred by book
entry) to each holder a new certificate representing the shares of
Series B Preferred Stock equal in Liquidation Preference amount to
any unpurchased portion of the shares of the shares of Series B
Preferred Stock represented by the certificates so surrendered. The
Company shall publicly announce the results of the Change of Control
Offer on or as soon as practicable after the Change of Control
Payment Date.
(f) If, at the time of a Change of Control, the Company is restricted or
prohibited by the terms of any Credit Facilities or Senior Debt from
purchasing shares of Series B Preferred Stock that may be tendered
by holders pursuant to a Change of Control Offer, prior to complying
with the provisions of Section 10(a), but in any event within 30
days following a Change of Control (unless the Company has exercised
its right to redeem all the Series B Preferred Stock pursuant to
Section 7(b)), the Company shall use commercially reasonable efforts
to (i) repay in full all outstanding Obligations under such Credit
Facilities or Senior Debt or offer to repay in full all outstanding
Obligations under such Credit Facilities or Senior Debt and repay
the Obligations of each lender who has accepted such offer or (ii)
obtain the requisite consent under such Credit Facilities or Senior
Debt to permit the repurchase of the Series B Preferred Stock
required by this Section 10.
(g) The Company shall not be required to make a Change of Control Offer
upon a Change of Control if a third party makes the Change of
Control Offer in the manner, at the times and otherwise in
compliance with the requirements set forth in this Section 10
applicable to a Change of Control Offer made by the Company and
purchases all shares of Series B Preferred Stock validly tendered
and not withdrawn under such Change of Control Offer.
11. CERTAIN COVENANTS.
(a) Restricted Payments.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(i) declare or pay any dividend or make any other payment or
distribution on account of any Junior Securities, other than
dividends or distributions payable in Junior Securities (other
than Disqualified Stock);
(ii) purchase, redeem or otherwise acquire or retire for value
Junior Securities; or
(iii) make any Restricted Investment (all such payments and other
actions set forth in clauses (i) through (iii) above being
collectively referred to as "Restricted Payments"), unless, at
the time of and after giving effect to such Restricted
Payment:
(1) no Voting Rights Triggering Event shall have occurred and
be continuing or would occur as a consequence thereof;
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(2) all dividends on the Series B Preferred Stock that have
accrued and become payable on or after October 15, 2008 have been declared and
paid in cash;
(3) the Company would, at the time of such Restricted Payment
and after giving pro forma effect thereto as if such Restricted Payment had been
made at the beginning of the applicable four-quarter period, have been permitted
to incur at least $1.00 of additional Indebtedness pursuant to the Debt to Cash
Flow Ratio test set forth in the first paragraph of Section 11(b) hereof, and
(4) such Restricted Payment, together with the aggregate
amount of all other Restricted Payments made by the Company and its Restricted
Subsidiaries after the Issue Date (excluding Restricted Payments permitted by
clauses (ii), (iii) and (iv) of the next succeeding paragraph), is less than the
sum, without duplication, of (i) an amount equal to the Consolidated Cash Flow
of the Company for the period (taken as one accounting period) from June 8, 2001
to the end of the Company's most recently ended full fiscal quarter for which
financial statements have been filed with the SEC (the "Basket Period") less the
product of 1.4 times the Consolidated Interest Expense of the Company for the
Basket Period), plus (ii) 100% of the aggregate net cash proceeds received by
the Company as a contribution to its common equity capital or from the issue or
sale since June 8, 2001 of Equity Interests of the Company (other than
Disqualified Stock) or from the issue or sale of Disqualified Stock or debt
securities of the Company that have been converted into such Equity Interests
(other than Equity Interests (or Disqualified Stock or convertible debt
securities) sold to a Subsidiary of the Company and other than Disqualified
Stock or Convertible debt securities that have been converted into Disqualified
Stock), plus (iii) to the extent that any Restricted Investment that was made
after the Issue Date is sold for cash or otherwise liquidated or repaid for
cash, the lesser of (A) the cash return of capital with respect to such
Restricted Investment (less the cost of disposition, if any) and (B) the initial
amount of such Restricted Investment.
The foregoing provisions will not prohibit (i) the payment of any dividend
within 60 days after the date of declaration thereof, if at the date of
declaration such payment would have complied with the provisions of this
Certificate of Designations; (ii) the redemption, repurchase, retirement or
other acquisition of any Junior Securities of the Company in exchange for, or
out of the net cash proceeds of the substantially concurrent sale (other than to
a Subsidiary of the Company) of, other Junior Securities or Parity Securities of
the Company (other than any Disqualified Stock); provided that the amount of any
such net cash proceeds that are utilized for any such redemption, repurchase,
retirement or other acquisition shall be excluded from clause (4)(ii) of the
preceding paragraph; and, provided further, that no Voting Rights Triggering
Event shall have occurred and be continuing immediately after such transaction;
(iii) the payment of any dividend by a Restricted Subsidiary of the Company to
the holders of its Equity Interests on a pro rata basis; (iv) the repurchase,
redemption or other acquisition or retirement for value of any Equity Interests
of the Company or any Restricted Subsidiary of the Company held by any member of
the Company's (or any of its Restricted Subsidiaries') management or board of
directors pursuant to any management equity subscription agreement, stock option
agreement or other similar agreement; provided that the aggregate price paid for
all such repurchased, redeemed, acquired or retired Equity Interests shall not
exceed $5.0 million (excluding for purposes of calculating such amounts during
any period, loans incurred to finance the purchase of such Equity Interests that
are repaid contemporaneously) in any twelve-month period and no Voting Rights
Triggering Event shall have occurred and be continuing immediately after such
transaction; (v) repurchases of stock deemed to have occurred by virtue of the
exercise of stock options; and (vi) other Restricted Payments in an aggregate
amount not to exceed $5.0 million in any twelve-month period so long as no
Voting Rights Triggering Event shall have occurred and be continuing.
The amount of all Restricted Payments (other than cash) shall be the fair
market value on the date of the Restricted Payment of the asset(s) or securities
proposed to be transferred or issued by the Company or such Restricted
Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair
-28-
market value of any non-cash Restricted Payment shall be determined in good
faith by the Board of Directors. Not later than the date of making any
Restricted Payment, the Company shall deliver to the Board of Directors an
Officers' Certificate stating that such Restricted Payment is permitted and
setting forth the basis upon which any calculation required by this Section
11(a) were computed.
The Board of Directors may designate any Restricted Subsidiary to be an
Unrestricted Subsidiary if such designation would not cause a Voting Rights
Triggering Event. For purposes of making such determination, the aggregate fair
market value of all outstanding Investments by the Company and its Restricted
Subsidiaries in the Subsidiary so designated will be deemed to be a Restricted
Payment at the time of such designation and will reduce the amount available for
Restricted Payments under the first paragraph of this Section 11(a). Such
designation will only be permitted if such Restricted Payment would be permitted
at such time and if such Subsidiary otherwise meets the definition of an
Unrestricted Subsidiary.
(b) Incurrence Of Indebtedness And Issuance Of Preferred Stock.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt) or issue any shares of Disqualified Stock and will not permit any of its
Restricted Subsidiaries to issue any shares of preferred stock; provided,
however, that, so long as no Voting Rights Triggering Event has occurred and is
continuing, the Company may incur Indebtedness (including Acquired Debt) or
issue shares of Disqualified Stock and its Restricted Subsidiaries may issue
shares of preferred stock if, in each case, the Company's Debt to Cash Flow
Ratio at the time of incurrence of such Indebtedness or the issuance of such
Disqualified Stock or preferred stock, as the case may be, after giving pro
forma effect to such incurrence or issuance as of such date and to the use of
the proceeds therefrom as if the same had occurred at the beginning of the most
recently ended four full fiscal quarter period of the Company for which internal
financial statements are available, would have been no greater than 7.0 to 1.0.
So long as no Voting Rights Triggering Event shall have occurred and be
continuing or should be caused thereby, the provisions of the first paragraph of
this Section 11(b) will not apply to the incurrence of any of the following
(collectively, "Permitted Debt"):
(i) the incurrence by the Company (and the guarantee thereof by any
Restricted Subsidiary) of Indebtedness and letters of credit under
one or more Credit Facilities in an aggregate principal amount at
any time outstanding not to exceed $175.0 million (with letters of
credit being deemed to have a principal amount equal to the maximum
potential liability of the Company and the Restricted Subsidiaries
thereunder), less the aggregate amount of all mandatory repayments
of the principal of any term Indebtedness under a Credit Facility
that have been made since the Issue Date (other than from the
proceeds of any other Credit Facility);
(ii) the incurrence by the Company and its Restricted Subsidiaries of the
Existing Indebtedness;
(iii) the incurrence by the Company or its Restricted Subsidiaries of
Indebtedness represented by Capital Lease Obligations, mortgage
financings or Purchase Money Indebtedness, in each case incurred for
the purpose of financing all or any part of the purchase price or
cost of construction or improvement of property, plant or equipment
used in the business of the Company or such Restricted Subsidiary,
in an aggregate amount not to exceed $5.0 million at any time
outstanding;
-29-
(iv) the incurrence by the Company or any of its Restricted Subsidiaries
of Permitted Refinancing Indebtedness or the issuance by the Company
of Disqualified Stock in exchange for, or the net proceeds of which
are used to refund, refinance or replace Indebtedness or
Disqualified Stock (other than intercompany Indebtedness) that was
permitted by this Certificate of Designations to be incurred by the
first paragraph of this Section 11(b), or by clauses (ii), (iii),
(iv), (vi), (vii), (viii), (ix), (x), (xi) or (xii) of this
paragraph;
(v) the incurrence of Indebtedness between or among the Company and any
of its Restricted Subsidiaries; provided, however, that (a) if the
Company is the obligor on such Indebtedness, such Indebtedness is
expressly subordinated to the prior payment in full of all
Obligations with respect to the Exchange Notes and (b) any
subsequent issuance or transfer of Equity Interests that results in
any such Indebtedness being held by a Person other than the Company
or a Restricted Subsidiary, and any sale or other transfer of any
such Indebtedness to a Person that is not either the Company or a
Restricted Subsidiary, shall be deemed, in each case, to constitute
an incurrence of such Indebtedness by the Company or such Restricted
Subsidiary, as the case may be;
(vi) the incurrence by the Company or any of its Restricted Subsidiaries
of Hedging Obligations that are incurred for the purpose of fixing
or hedging interest rate risk with respect to any floating rate
Indebtedness that is permitted by the terms of this Certificate of
Designations to be outstanding;
(vii) the guarantee by the Company or any Restricted Subsidiary of
Indebtedness that was permitted to be incurred by another provision
of this Section 11(b);
(viii) the accrual of interest, the accretion or amortization of original
issue discount, the payment of interest on any Indebtedness in the
form of additional Indebtedness with the same terms, and the payment
of dividends on Disqualified Stock in the form of additional shares
of the same class of Disqualified Stock;
(ix) the incurrence by the Company or any of its Restricted Subsidiaries
of Indebtedness consisting of performance, bid or advance payment
bonds, surety bonds, custom bonds, utility bonds and similar
obligations arising in the ordinary course of business;
(x) the incurrence by the Company or any of its Restricted Subsidiaries
of Indebtedness arising from agreements providing for
indemnification, adjustment of purchase price or similar
obligations, in each case incurred or assumed in connection with the
disposition of any business, asset or Subsidiary of the Company;
provided that the maximum assumable Indebtedness shall at no time
exceed the gross proceeds actually received by the Company and its
Restricted Subsidiaries in connection with the disposition of any
business, asset or Subsidiary of the Company;
(xi) the incurrence by the Company of Indebtedness in respect of Series B
Preferred Stock issued as payment in kind interest on the Series B
Preferred Stock outstanding on the Issue Date or issued subsequent
to the Issue Date as dividends permitted by this clause (xi), to the
extent such dividends are made pursuant to the terms of this
Certificate of Designations, on any preferred stock issued in
exchange for the Series B Preferred Stock, or any dividends on such
preferred stock issued in exchange for the Series B Preferred Stock,
or any dividends on such preferred stock to the extent such
dividends are made pursuant to the terms of the certificate of
designations of such preferred stock; and
-30-
(xii) the incurrence by the Company or any of its Restricted Subsidiaries
of additional Indebtedness in an aggregate principal amount at any
time outstanding, including all Permitted Refinancing Indebtedness
incurred pursuant to clause (v) above to refund, refinance or
replace any Indebtedness incurred pursuant to this clause (xii), not
to exceed $10.0 million.
For purposes of determining compliance with this Section 11(b), in the
event that an item of Indebtedness meets the criteria of more than one of the
categories of Permitted Debt described in clauses (i) through (xii) above or is
entitled to be incurred pursuant to the first paragraph of this Section 11(b),
the Company shall, in its sole discretion, classify and reclassify such item of
Indebtedness in whole or in part in any manner that complies with this Section
11(b) and such item of Indebtedness will be treated as having been incurred
pursuant to such clauses or pursuant to the first paragraph hereof.
(c) Merger, Consolidation, or Sale of Assets.
The Company may not consolidate or merge with or into (whether
or not the Company is the surviving corporation) another Person, or
sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of its properties or assets, in one or more
related transactions, to another Person, and the Company may not
permit any of its Restricted Subsidiaries to enter into any such
transaction or series of transactions if such transaction or series
of transactions would, in the aggregate, result in a sale,
assignment, transfer, lease, conveyance, or other disposition of all
or substantially all of the properties or assets of the Company to
another Person unless (i) the Company is the surviving corporation
or the Person formed by or surviving any such consolidation or
merger (if other than the Company) or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall
have been made (the "Surviving Entity") is a corporation organized
or existing under the laws of the United States, any state thereof
or the District of Columbia; (ii) the Series B Preferred Stock shall
be converted into or exchanged for and shall become shares of the
Surviving Entity, having in respect of such successor, transferee or
resulting corporation substantially the same powers, preferences and
relative participating, optional or other special rights, and the
qualifications, limitations or restrictions thereon that the Series
B Preferred Stock had immediately prior to such transaction; (iii)
immediately after such transaction, no Voting Rights Triggering
Event, and no event that after the giving of notice or lapse of time
or both would become a Voting Rights Triggering Event, shall have
occurred and be continuing; and (iv) the Company or the Surviving
Entity will, at the time of such transaction or series of
transactions and after giving pro forma effect thereto as if such
transaction or series of transactions had occurred at the beginning
of the applicable four-quarter period, be permitted to incur at
least $1.00 of additional Indebtedness pursuant to the test set
forth in the first paragraph of Section 11(a). Notwithstanding the
restrictions described in the foregoing clause (iv), any Restricted
Subsidiary may consolidate with, merge into or transfer all or part
of its properties and assets to the Company, and any Wholly Owned
Restricted Subsidiary may consolidate with, merge into or transfer
all or part of its properties and assets to another Wholly Owned
Restricted Subsidiary.
(d) Transactions With Affiliates.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each of the foregoing,
-31-
an "Affiliate Transaction"), unless (i) such Affiliate Transaction is on terms
that are no less favorable to the Company or such Restricted Subsidiary than
those that would have been obtained in a comparable transaction by the Company
or such Restricted Subsidiary with an unrelated Person (ii) with respect to any
Affiliate Transaction or series of related Affiliate Transactions involving
aggregate consideration in excess of $2.5 million, such Affiliate Transaction or
series of Affiliated Transactions has been approved by a majority of the members
of the Board of Directors that are disinterested as to such Affiliate
Transaction or series of Affiliated Transactions and (iii) with respect to any
Affiliate Transaction or series of related Affiliate Transactions involving
aggregate consideration in excess of $10.0 million, an opinion as to the
fairness to the Company of such Affiliate Transaction or series of Affiliated
Transactions from a financial point of view issued by an accounting, appraisal
or investment banking firm of national standing; provided that (1) any
transaction approved by the Board of Directors of the Company, with an officer
or director of the Company or of any of its Subsidiaries in his or her capacity
as an officer or director entered into in the ordinary course of business; (2)
transactions between or among the Company and/or its Restricted Subsidiaries;
(3) payment of reasonable directors fees to the Board of Directors of the
Company and of its Restricted Subsidiaries; (4) fees and compensation paid to,
and indemnity provided on behalf of, officers, directors or employees of the
Company or any of its Restricted Subsidiaries, as determined in good faith by
the Board of Directors of the Company or of any such Restricted Subsidiary, to
the extent the same are reasonable and customary; (5) any Restricted Payment
that is permitted by Section 11(a); and (6) agreements in effect on the Issue
Date and any modification thereto or any transaction contemplated thereby
(including pursuant to any modification thereto) in any replacement agreement
therefor so long as such modification or replacement is not more disadvantageous
to the Holders in any material respect than the original agreement as in effect
on the Issue Date, in each case, shall not be deemed to be Affiliate
Transactions.
(e) Reports.
Whether or not required by the rules and regulations of the Commission, so
long as any shares of Series B Preferred Stock are outstanding, the Company will
make available to the Holders, upon request, (i) all quarterly and annual
financial information that would be required to be contained in a filing with
the Commission on Forms 10-Q and 10-K if the Company were required to file such
Forms, including a "Management's Discussion and Analysis of Financial Condition
and Results of Operations" that describes the financial condition and results of
operations of the Company and its consolidated Subsidiaries (showing in
reasonable detail, either on the face of the financial statements or in the
footnotes thereto and in Management's Discussion and Analysis of Financial
Condition and Results of Operations, the financial condition and results of
operations of the Company and its Restricted Subsidiaries separate from the
financial information and results of operations of the Unrestricted Subsidiaries
of the Company) and, with respect to the annual information only, a report
thereon by the Company certified independent accountants and (ii) all current
reports that would be required to be filed with the Commission on Form 8-K if
the Company was required to file such reports, in each case within the time
periods set forth in the Commission's rules and regulations. In addition,
whether or not required by the rules and regulations of the Commission, the
Company will file a copy of such information and reports with the Commission for
public availability within the time periods set forth in the Commission's rules
and regulations (unless the Commission will not accept such filing).
12. AMENDMENT.
Notwithstanding anything to the contrary in the DGCL, unless otherwise
provided in Section 3(b) or 9, neither this Certificate of Designations nor the
Certificate of Incorporation shall be amended in any manner that would increase
or decrease the par value of the shares of the Series B Preferred Stock class or
alter or change the powers, preferences or special rights of the Series B
Preferred Stock so as to affect the
-32-
Holders thereof adversely without the affirmative vote of the Holders of a
majority of the outstanding Series B Preferred Stock voting separately as a
class.
13. PAYMENT
(a) All amounts payable in cash with respect to the Series B Preferred
Stock shall be payable in United States dollars at the office or
agency of the Company maintained for such purpose within the City
and State of New York or, at the option of the Company, payment of
cash dividends (if any) may be made by check mailed to the Holders
of the Series B Preferred Stock at their respective registered
addresses, provided that all cash payments with respect to the
Global Preferred Shares and Certificated Shares the Holders of which
have given wire transfer instructions to the Company shall be
required to be made by wire transfer of immediately available funds
to the accounts specified by the Holders thereof.
(b) The Company has initially appointed the Transfer Agent to act as the
"Paying Agent." The Company may at any time terminate the
appointment of any Paying Agent and appoint additional or other
Paying Agents, provided that until the Series B Preferred Stock has
been delivered to the Company for cancellation, or moneys sufficient
to pay the Liquidation Preference and accumulated but unpaid
dividends on the Series B Preferred Stock have been made available
for payment and either paid or returned to the Company as provided
in this Certificate of Designation, it shall maintain an office or
agency in the Borough of Manhattan, the City of New York for any
payments under this Certificate of Designations, for surrender of
Series B Preferred Stock or for exchange of the Series B Preferred
Stock for Exchange Notes.
14. FORM.
(a) The Series B Preferred Stock shall initially be issued in the form
of one or more permanent global shares of Series B Preferred Stock
in fully registered form with the global legend in the form set
forth on Exhibit B (the "Global Shares Legend") and the "Schedule of
Exchanges for Global Security" set forth on Exhibit C (the "Global
Preferred Shares"). The Global Preferred Shares shall be deposited
on the Issue Date with the Transfer Agent as custodian for The
Depository Trust Company ("DTC") and registered in the name of DTC
or its nominee (DTC or such nominee, the "Global Share Holder"). The
Series B Preferred Stock may have additional notations, legends or
endorsements required by law, stock exchange rule or usage.
(b) Any person having a beneficial interest in a Global Preferred Share
may, upon request by prior written notice given to the Transfer
Agent by or on behalf of DTC, exchange such beneficial interest for
Series B Preferred Stock in the form of registered definitive
certificates ("Certificated Shares"). Upon any such issuance, the
Company shall register such Certificated Shares in the name of, and
cause the same to be delivered to, such person or persons (or the
nominee of any thereof). If (i)(A) DTC is unwilling or unable to
continue as Depositary for the Global Preferred Share and the
Company does not appoint a qualified replacement for DTC within 90
days or (B) DTC ceases to be a "Clearing Agency" registered under
the Exchange Act; (ii) the Company, at its option, notifies the
Transfer Agent in writing that the Company elects to cause the
issuance of Certificated Shares; or (C) there shall have occurred
and be continuing a Voting Rights Triggering Event, then, upon
surrender by the Global Share Holder of its Global Preferred Shares,
Certificated Securities will be issued to each person that the
Global
-33-
Share Holder identifies as being the beneficial owner of the related
Series B Preferred Stock. Certificated Shares shall not bear the
Global Shares Legend and shall not include the "Schedule of
Exchanges for Global Security."
(c) Notwithstanding any provision to the contrary herein, so long as a
Global Preferred Share remains outstanding and is held by or on
behalf of DTC, transfers of a Global Preferred Share, in whole or in
part, or of any beneficial interest therein, shall only be made in
accordance with this Certificate of Designations and the applicable
procedures of DTC; provided, however, that beneficial interests in a
Global Preferred Share may be transferred to persons who take
delivery thereof in the form of a beneficial interest in the same or
a different Global Preferred Share in accordance with the transfer
restrictions set forth in the Global Restricted Shares Legend; and
provided further that the transferor such certification and opinions
of counsel as may be reasonably requested by the Transfer Agent.
15. EXCLUSION OF OTHER RIGHTS.
Except as may otherwise be required by law, the shares of Series B
Preferred Stock shall not have any voting powers, preferences and relative,
participating, optional or other special rights, other than those specifically
set forth in this Certificate of Designations (as such Certificate of
Designations may be amended from time to time in accordance with the terms
hereof) and in the Certificate of Incorporation. The shares of Series B
Preferred Stock shall have no preemptive or subscription rights.
16. HEADINGS OF SECTIONS.
The headings of the various sections and subsections hereof are for
convenience of reference only and shall not affect the interpretation of any of
the provisions hereof.
17. SEVERABILITY OF PROVISIONS.
If any voting powers, preferences and relative, participating, optional
and other special rights of the Series B Preferred Stock and qualifications,
limitations and restrictions thereof set forth in this Certificate of
Designations (as this Certificate of Designations may be amended from time to
time) is invalid, unlawful or incapable of being enforced by reason of any rule
of law or public policy, all other voting powers, preferences and relative,
participating, optional and other special rights of Series B Preferred Stock and
qualifications, limitations and restrictions thereof set forth in this
Certificate of Designations (as so amended) which can be given effect without
the invalid, unlawful or unenforceable voting powers, preferences and relative,
participating, optional and other special rights of Series B Preferred Stock and
qualifications, limitations and restrictions thereof shall, nevertheless, remain
in full force and effect, and no voting powers, preferences and relative,
participating, optional or other special rights of Series B Preferred Stock and
qualifications, limitations and restrictions thereof herein set forth shall be
deemed dependent upon any other such voting powers, preferences and relative,
participating, optional or other special rights of Series B Preferred Stock and
qualifications, limitations and restrictions thereof unless so expressed herein.
-34-
IN WITNESS WHEREOF, Spanish Broadcasting System, Inc. has caused this
Certificate of Designations setting forth the voting power, preferences and
relative, participating, optional and other special rights and qualifications,
limitations and restrictions of the Company's 10 3/4% Series B Cumulative
Exchangeable Redeemable Preferred Stock to be duly executed by its authorized
officer this 29th day of October, 2003.
SPANISH BROADCASTING SYSTEM, INC.
By: /s/ Joseph A. Garcia
-------------------------------
Name: Joseph A. Garcia
Title: Chief Financial Officer,
Executive Vice President
and Secretary
EXHIBIT A
FORM OF INDENTURE
================================================================================
SPANISH BROADCASTING SYSTEM, INC.
10 3/4% SUBORDINATED EXCHANGE NOTES DUE 2013
-------------------------------
INDENTURE
Dated as of ______________________
-------------------------------
-------------------------------
WACHOVIA BANK, NATIONAL ASSOCIATION
TRUSTEE
-------------------------------
================================================================================
CROSS-REFERENCE TABLE*
Trust Indenture Act Section Indenture Section
310(a)(1)................................................. 7.10
(a)(2).................................................... 7.10
(a)(3).................................................... N.A.
(a)(4).................................................... N.A.
(a)(5).................................................... 7.10
(i)(b).................................................... 7.10
(ii)(c)................................................... N.A.
311(a).................................................... 7.11
(b)....................................................... 7.11
(iii)(c).................................................. N.A.
312(a).................................................... 2.05
(b)....................................................... 12.03
(iv)(c)................................................... 12.03
313(a).................................................... 7.06
(b)(2).................................................... 7.07
(v)(c).................................................... 7.06; 12.02
(vi)(d)................................................... 7.06
314(a).................................................... 4.03;12.02
314(b).................................................... 4.6; 4.8; 11.2
(c)(1).................................................... 12.04
(c)(2).................................................... 12.04
(c)(3).................................................... N.A.
(vii)(e).................................................. 11.05
(f)....................................................... N.A.
315(a).................................................... 7.01
(b)....................................................... 7.05,12.02
(A)(c).................................................... 7.01
(d)....................................................... 7.01
(e)....................................................... 6.11
316(a)(last sentence)..................................... 2.09
(a)(1)(A)................................................. 6.05
(a)(1)(B)................................................. 6.04
(a)(2).................................................... N.A.
(b)....................................................... 6.07
(B)(c).................................................... 2.12
317(a)(1)................................................. 6.08
(a)(2).................................................... 6.09
(b)........................................... 2.04
318(a).................................................... 11.1
318(c).................................................... 11.1
N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.
TABLE OF CONTENTS
PAGE
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ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE.................................................1
Section 1.01. Definitions...........................................................................1
Section 1.02. Other Definitions....................................................................16
Section 1.03. Incorporation By Reference Of Trust Indenture Act....................................17
Section 1.04. Rules Of Construction................................................................17
ARTICLE II THE NOTES.................................................................................18
Section 2.01. Form And Dating......................................................................18
Section 2.02. Execution And Authentication.........................................................19
Section 2.03. Registrar And Paying Agent...........................................................19
Section 2.04. Paying Agent To Hold Money In Trust..................................................20
Section 2.05. Holder Lists.........................................................................20
Section 2.06. Transfer And Exchange................................................................20
Section 2.07. Replacement Notes....................................................................30
Section 2.08. Outstanding Notes....................................................................31
Section 2.09. Treasury Notes.......................................................................31
Section 2.10. Temporary Notes......................................................................31
Section 2.11. Cancellation.........................................................................32
Section 2.12. Defaulted Interest...................................................................32
Section 2.13. CUSIP Numbers........................................................................32
ARTICLE III REDEMPTION AND PREPAYMENT.................................................................32
Section 3.01. Notices To Trustee...................................................................32
Section 3.02. Selection Of Notes To Be Redeemed....................................................33
Section 3.03. Notice Of Redemption.................................................................33
Section 3.04. Effect Of Notice Of Redemption.......................................................34
Section 3.05. Deposit Of Redemption Price..........................................................34
Section 3.06. Notes Redeemed In Part...............................................................35
Section 3.07. Optional Redemption..................................................................35
Section 3.08. Mandatory Redemption.................................................................36
Section 3.09. Offer To Purchase By Application Of Excess Proceeds..................................36
ARTICLE IV COVENANTS.................................................................................37
Section 4.01. Payment Of Notes.....................................................................37
i
TABLE OF CONTENTS
(CONTINUED)
PAGE
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Section 4.02. Maintenance Of Office Or Agency......................................................38
Section 4.03. Reports..............................................................................38
Section 4.04. Compliance Certificate...............................................................39
Section 4.05. Taxes................................................................................40
Section 4.06. Stay, Extension And Usury Laws.......................................................40
Section 4.07. Restricted Payments..................................................................40
Section 4.08. Dividend And Other Payment Restrictions Affecting Subsidiaries.......................42
Section 4.09. Incurrence Of Indebtedness And Issuance Of Preferred Stock...........................43
Section 4.10. Asset Sales..........................................................................46
Section 4.11. Transactions With Affiliates.........................................................47
Section 4.12. Liens................................................................................48
Section 4.13. Asset Swaps..........................................................................48
Section 4.14. Corporate Existence..................................................................48
Section 4.15. Offer To Repurchase Upon Change Of Control...........................................48
Section 4.16. Limitation on Other Subordinated Debt................................................49
Section 4.17. Limitation On Sale And Leaseback Transactions........................................49
Section 4.18. Payments For Consent.................................................................50
Section 4.19. Additional Subsidiary Guarantees.....................................................50
ARTICLE V SUCCESSORS................................................................................50
Section 5.01. Merger, Consolidation, Or Sale Of Assets.............................................50
Section 5.02. Successor Corporation Substituted....................................................51
ARTICLE VI DEFAULTS AND REMEDIES.....................................................................51
Section 6.01. Events Of Default....................................................................51
Section 6.02. Acceleration.........................................................................53
Section 6.03. Other Remedies.......................................................................54
Section 6.04. Waiver Of Past Defaults..............................................................54
Section 6.05. Control By Majority..................................................................54
Section 6.06. Limitation On Suits..................................................................54
Section 6.07. Rights Of Holders Of Notes To Receive Payment........................................55
Section 6.08. Collection Suit By Trustee...........................................................55
Section 6.09. Trustee May File Proofs Of Claim.....................................................55
ii
TABLE OF CONTENTS
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Section 6.10. Priorities...........................................................................56
Section 6.11. Undertaking For Costs................................................................56
Section 6.12. No Personal Liability Of Directors, Officers, Employees And Stockholders............56
ARTICLE VII TRUSTEE...................................................................................57
Section 7.01. Duties Of Trustee....................................................................57
Section 7.02. Rights Of Trustee....................................................................58
Section 7.03. Individual Rights Of Trustee.........................................................59
Section 7.04. Trustee's Disclaimer.................................................................59
Section 7.05. Notice Of Defaults...................................................................59
Section 7.06. Reports By Trustee To Holders Of The Notes...........................................60
Section 7.07. Compensation And Indemnity...........................................................60
Section 7.08. Replacement Of Trustee...............................................................61
Section 7.09. Successor Trustee By Merger, Etc.....................................................62
Section 7.10. Eligibility; Disqualification........................................................62
Section 7.11. Preferential Collection Of Claims Against Company....................................62
ARTICLE VIII LEGAL DEFEASANCE AND COVENANT DEFEASANCE..................................................62
Section 8.01. Option To Effect Legal Defeasance Or Covenant Defeasance.............................62
Section 8.02. Legal Defeasance And Discharge.......................................................62
Section 8.03. Covenant Defeasance..................................................................63
Section 8.04. Conditions To Legal Or Covenant Defeasance...........................................63
Section 8.05. Deposited Money And Government Securities To Be Held In Trust; Other
Miscellaneous Provisions.............................................................65
Section 8.06. Repayment To Company.................................................................65
Section 8.07. Reinstatement........................................................................66
ARTICLE IX AMENDMENT, SUPPLEMENT AND WAIVER..........................................................66
Section 9.01. Without Consent Of Holders Of Notes..................................................66
Section 9.02. With Consent Of Holders Of Notes.....................................................67
Section 9.03. Compliance With Trust Indenture Act..................................................68
Section 9.04. Revocation And Effect Of Consents....................................................68
Section 9.05. Notation On Or Exchange Of Notes.....................................................69
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Section 9.06. Trustee To Sign Amendments, Etc......................................................69
ARTICLE X SUBORDINATION.............................................................................69
Section 10.01. Agreement To Subordinate.............................................................69
Section 10.02. Certain Definitions..................................................................69
Section 10.03. Liquidation; Dissolution; Bankruptcy.................................................70
Section 10.04. Default On Designated Senior Debt....................................................71
Section 10.05. Acceleration Of Securities...........................................................72
Section 10.06. When Distribution Must Be Paid Over..................................................72
Section 10.07. Notice By Company....................................................................72
Section 10.08. Subrogation..........................................................................72
Section 10.09. Relative Rights......................................................................73
Section 10.10. Subordination Not Prejudiced.........................................................73
Section 10.11. Distribution Or Notice To Representative.............................................74
Section 10.12. Rights Of Trustee And Paying Agent...................................................74
Section 10.13. Authorization To Effect Subordination................................................75
Section 10.14. Reinstatement........................................................................75
Section 10.15. Amendments...........................................................................75
ARTICLE XI SUBSIDIARY GUARANTEES.....................................................................75
Section 11.01. Guarantee............................................................................75
Section 11.02. Subordination Of Subsidiary Guarantee................................................76
Section 11.03. Limitation On Guarantor Liability....................................................76
Section 11.04. Execution And Delivery Of Note Guarantee.............................................77
Section 11.05. Guarantors May Consolidate, Etc., On Certain Terms...................................77
Section 11.06. Releases Following Sale Of Assets....................................................78
ARTICLE XII MISCELLANEOUS.............................................................................79
Section 12.01. Trust Indenture Act Controls.........................................................79
Section 12.02. Notices..............................................................................79
Section 12.03. Communication By Holders Of Notes With Other Holders Of Notes........................80
Section 12.04. Certificate And Opinion As To Conditions Precedent...................................80
Section 12.05. Statements Required In Certificate Or Opinion........................................80
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Section 12.06. Rules By Trustee And Agents..........................................................81
Section 12.07. No Personal Liability Of Directors, Officers, Employees And Stockholders.............81
Section 12.08. Governing Law........................................................................81
Section 12.09. No Adverse Interpretation Of Other Agreements........................................81
Section 12.10. Successors...........................................................................81
Section 12.11. Severability.........................................................................81
Section 12.12. Counterpart Originals................................................................82
Section 12.13. Table Of Contents, Headings, Etc.....................................................82
EXHIBITS
Exhibit A FORM OF NOTE
Exhibit B FORM OF GUARANTY
Exhibit C-1 FORM OF CERTIFICATE OF TRANSFER
Exhibit C-2 FORM OF CERTIFICATE OF EXCHANGE
Exhibit C-3 FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
v
INDENTURE dated as of _________________ among SPANISH
BROADCASTING SYSTEM, INC., a Delaware corporation (the "Company"), [LIST
SUBSIDIARY SIGNATORIES] and WACHOVIA BANK, NATIONAL ASSOCIATION, a national
banking association, as trustee (the "Trustee").
The Company has duly authorized the creation of an issue of
its 10 3/4% Subordinated Exchange Notes due 2013 which shall be issued in
exchange for the Company's Exchangeable Preferred Stock (as defined herein) and,
to provide therefor, the Company has duly authorized the execution and delivery
of this Indenture. All things necessary to make the Notes, when duly issued and
executed by the Company, and authenticated and delivered hereunder, the valid
obligations of the Company, and to make this Indenture a valid and binding
agreement of the Company, have been done.
The Company, the Guarantors and the Trustee agree as follows
for the benefit of each other and for the equal and ratable benefit of the
Holders (as defined below) of the Notes:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS.
"144A Global Note" means a Global Note substantially in the
form of Exhibit A hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of, and registered in the name
of, the Depositary or its nominee sold in reliance on Rule 144A.
"Acquired Debt" means, with respect to any specified Person,
(i) Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, including,
without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person; and (ii) Indebtedness secured by a Lien
encumbering any asset acquired by such specified Person.
"Acquisition Indebtedness" means Indebtedness incurred by the
Company or by a Restricted Subsidiary the proceeds of which are used for the
acquisition of a Permitted Business and related facilities and assets or for the
construction of a facility pursuant to a construction permit issued by the FCC.
"Affiliate" of any specified Person means any other Person
which directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, such specified Person. For the
purposes of this definition, "control" (including, with correlative meanings,
the terms "controlling," "controlled by," and "under common control with"), as
used with respect to any Person, means the possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of
such Person, whether through the ownership of voting securities, by agreement or
otherwise; PROVIDED that (a) beneficial ownership of at least 10% of the Voting
Stock of a Person shall be deemed to be control and (b) for purposes of the
"Transactions with Affiliates" covenant contained in Section 4.11, for so long
as Pablo Raul Alarcon, Sr., Raul Alarcon, Jr. or Jose Grimalt are directors,
1
officers or shareholders of the Company, they, their respective spouses, lineal
descendants and any Person controlled by any of them shall be Affiliates of the
Company and its Subsidiaries.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in the Global Note, the rules and
procedures of the Depositary, that apply to such transfer or exchange.
"Asset Sale" means (i) the sale, lease, conveyance or other
disposition of any assets or rights (including, without limitation, by way of a
sale and leaseback), excluding sales of services and goods in the ordinary
course of business consistent with past practices (PROVIDED that the sale,
lease, conveyance or other disposition of all or substantially all of the assets
of the Company and its Restricted Subsidiaries taken as a whole will be governed
by the provisions of Section 4.15 hereof and/or the provisions of Section 5.01
hereof and not by the provisions of Section 4.10 hereof) and (ii) the issue or
sale by the Company or any of its Subsidiaries of Equity Interests of any of the
Company's Subsidiaries, in the case of either clause (i) or (ii), whether in a
single transaction or a series of related transactions (a) that have a fair
market value in excess of $5.0 million or (b) for net proceeds in excess of $5.0
million.
Notwithstanding the foregoing, the following items will not be
deemed to be Asset Sales: (i) a transfer of assets by the Company to a Guarantor
or by a Guarantor to the Company or to another Guarantor, (ii) an issuance of
Equity Interests by a Guarantor to the Company or to another Guarantor, (iii)
the sale, lease or other disposition of equipment or other assets in the
ordinary course of business, (iv) the sale and leaseback of any assets within 90
days of the acquisition of such assets, (v) a Restricted Payment that is
permitted by Section 4.07 hereof, (vi) a transfer of any FCC License to a
Non-Guarantor Subsidiary, described in clause (i) of the definition thereof,
(vii) an Asset Swap, and (viii) the sale or other disposition by the Company or
its Subsidiaries of the Company's radio stations KLEY-FM and KSAH-AM serving the
San Antonio, Texas market, and radio station KPTI-FM serving the San Francisco,
California market.
"Asset Swap" means the execution of a definitive agreement,
subject only to regulatory approval and other customary closing conditions, that
the Company in good faith believes will be satisfied, for a substantially
concurrent purchase and sale, or exchange, of assets used or useful in a
Permitted Business between the Company or any of its Restricted Subsidiaries and
another person or group of affiliated persons; PROVIDED that any amendment to or
waiver of any closing conditions which individually or in the aggregate is
material to the Asset Swap shall be deemed to be a new Asset Swap.
"Attributable Debt" in respect of a sale and leaseback
transaction means, at the time of determination, the present value (discounted
at the rate of interest implicit in such transaction, determined in accordance
with GAAP) of the obligation of the lessee for net rental payments during the
remaining term of the lease included in such sale and leaseback transaction
(including any period for which such lease has been extended or may, at the
option of the lessor, be extended).
2
"Bank Indebtedness" means (i) Indebtedness of the Company
incurred in accordance with this Indenture owing to one or more commercial
banking institutions that are members of the Federal Reserve System and (ii) any
guarantee by a Guarantor of any Indebtedness of the Company of the type set
forth in clause (i) of this definition.
"Bankruptcy Law" means Title 11, U.S. Code or any similar
federal or state law for the relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in
Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the
beneficial ownership of any particular "person," as such term is used in Section
13(d)(3) of the Exchange Act, such "person" shall be deemed to have beneficial
ownership of all securities that such "person" has the right to acquire, whether
such right is currently exercisable or is exercisable only upon the occurrence
of a subsequent condition.
"Board of Directors" means the Board of Directors of the
Company, or any authorized committee of the Board of Directors.
"Business Day" means any day of the year other than a
Saturday, a Sunday on which banking institutions in The City of New York are
authorized by law, regulation or executive order to remain closed. If a payment
date is not a Business Day, payment may be made on the next succeeding Business
Day, and no interest shall accrue on such payment for the intervening period.
"Capital Lease Obligation" means, at the time any
determination thereof is to be made, the amount of the liability in respect of a
capital lease that would at such time be required to be capitalized on a balance
sheet in accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation,
corporate stock, (ii) in the case of an association or business entity, any and
all shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership or limited
liability company, partnership or membership interests (whether general or
limited) and (iv) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.
"Cash Equivalents" means (i) United States dollars, (ii)
securities issued or directly and fully guaranteed or insured by the United
States government or any agency or instrumentality thereof having maturities of
not more than one year from the date of acquisition, (iii) certificates of
deposit and eurodollar time deposits with maturities of one year or less from
the date of acquisition, bankers' acceptances with maturities not exceeding six
months and overnight bank deposits, in each case with any domestic commercial
bank having capital and surplus in excess of $500.0 million and a Thompson Bank
Watch Rating of "B" or better, (iv) repurchase obligations with a term of not
more than seven days for underlying securities of the types described in clauses
(ii) and (iii) above entered into with any financial institution meeting the
qualifications specified in clause (iii) above and (v) commercial paper having
the highest rating obtainable from Moody's Investors Service, Inc. or Standard &
Poor's Corporation and in each case maturing within 270 days after the date of
acquisition and (vi) money market funds at least 95% of the assets of which
constitute Cash Equivalents of the kinds described in clauses (i) through (v) of
this definition.
3
"Certificate of Designations" means the Certificate of
Designations setting forth the voting power, preferences and relative,
participating, optional and other special rights and qualifications, limitations
and restrictions of the Series A Preferred Stock and the Certificate of
Designations setting forth the voting power, preferences and relative,
participating, optional and other special rights and qualifications, limitations
and restrictions of the Series B Preferred Stock, as the case may be.
"Change of Control" means the occurrence of any of the
following: (i) the sale, lease, transfer, conveyance or other disposition (or by
way of merger or consolidation), in one or a series of related transactions, of
all or substantially all of the assets of the Company and its Subsidiaries taken
as a whole to any "person" (as such term is used in Section 13(d)(3) of the
Exchange Act) other than the Principal or a Related Party of the Principal, (ii)
the adoption of a plan relating to the liquidation or dissolution of the
Company, (iii) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that any
"person" (as defined above), other than the Principal and his Related Parties,
becomes the "Beneficial Owner," directly or indirectly, of more than 35% of the
Voting Stock of the Company, (iv) the Principal ceases to be the Beneficial
Owner, directly or indirectly, of a majority of the voting power of Voting Stock
of the Company (measured by voting power rather than number of shares) as a
result of any direct or indirect transfer of securities by the Principal, or (v)
the first day on which a majority of the members of the Board of Directors of
the Company are not Continuing Directors.
"Clearstream" means Clearstream Banking S.A., or its
successor.
"Company" means Spanish Broadcasting System, Inc., a Delaware
corporation, and any and all successors thereto.
"Consolidated Cash Flow" means, with respect to any Person for
any period, the Consolidated Net Income of such Person for such period plus,
without duplication, (i) an amount equal to any extraordinary loss plus any net
loss realized in connection with an Asset Sale, to the extent such losses were
deducted in computing such Consolidated Net Income, plus (ii) provision for
taxes based on income or profits of such Person and its Restricted Subsidiaries
for such period, to the extent that such provision for taxes was deducted in
computing such Consolidated Net Income, plus (iii) consolidated interest expense
of such Person and its Restricted Subsidiaries for such period, whether paid or
accrued and whether or not capitalized (including, without limitation,
amortization of debt issuance costs and original issue discount, non-cash
interest payments, the interest component of any deferred payment obligations,
the interest component of all payments associated with Capital Lease
Obligations, imputed interest with respect to Attributable Debt, commissions,
discounts and other fees and charges incurred in respect of letter of credit or
bankers' acceptance financings, and net payments (if any) pursuant to Hedging
Obligations), to the extent that any such expense was deducted in computing such
Consolidated Net Income, plus (iv) depreciation expense for such period, to the
extent the same was deducted in computing such Consolidated Net Income, plus (v)
all amortization expense and other non-cash expenses (excluding any such
non-cash expense to the extent that it represents an accrual of or reserve for
cash expenses in any future period) for such period, to the extent the same was
deducted in computing such Consolidated Net Income, minus (vi) non-cash items
increasing such Consolidated Net Income for such period.
4
Consolidated Cash Flow shall be calculated on a PRO FORMA
basis after giving effect to any acquisition as if such acquisition (including
any Consolidated Cash Flow associated with such acquisition) occurred on the
first day of the most recently ended four quarter period, giving pro forma
effect to any non-recurring expenses, non-recurring costs and cost reductions
within the first year after such acquisition which the Company anticipates if
the Company delivers to the Trustee an officer's certificate executed by its
chief financial or accounting officer certifying to and describing and
quantifying with reasonable specificity such non-recurring expenses,
non-recurring costs and cost reductions.
"Consolidated Indebtedness" means, with respect to any Person
as of any date of determination, the sum, without duplication, of (i) the total
amount of Indebtedness and Attributable Debt of such Person and its Restricted
Subsidiaries, plus (ii) the total amount of Indebtedness and Attributable Debt
of any other Person, to the extent that such Indebtedness or Attributable Debt
has been guaranteed by the referent Person or by one or more of its Restricted
Subsidiaries or is secured by a Lien on assets of the referent Person or any of
its Restricted Subsidiaries, plus (iii) the aggregate liquidation value of all
Disqualified Stock of such Person and all preferred stock of Restricted
Subsidiaries of such Person, in each case, determined on a consolidated basis in
accordance with GAAP.
"Consolidated Interest Expense" means, with respect to any
Person for any period, the sum of: (i) the consolidated interest expense of such
Person and its Restricted Subsidiaries for such period, whether paid or accrued
(including, without limitation, amortization of original issue discount,
non-cash interest payments, the interest component of any deferred payment
obligations, the interest component of all payments associated with Capital
Lease Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect of letters
of credit or bankers' acceptance financing, and net payments (if any) pursuant
to Hedging Obligations); and (ii) the consolidated interest expense of such
Person and its Restricted Subsidiaries that was capitalized during such period;
and (iii) any interest expense on Indebtedness or Attributable Debt of another
Person that is guaranteed by such Person or one of its Restricted Subsidiaries
or secured by a Lien on assets of such Person or one of its Restricted
Subsidiaries (whether or not such guarantee or Lien is called upon).
"Consolidated Net Income" means, with respect to any Person
for any period, the aggregate of the Net Income of such Person and its
Subsidiaries for such period, on a consolidated basis, determined in accordance
with GAAP; PROVIDED that (i) except as otherwise provided in clause (v) below,
the positive Net Income of any Person that is not a Restricted Subsidiary or
that is accounted for by the equity method of accounting shall be included only
to the extent of the amount of dividends or distributions paid in cash to the
referent Person or a Restricted Subsidiary thereof, (ii) the Net Income of any
Restricted Subsidiary shall be excluded to the extent that the declaration or
payment of dividends or similar distributions by that Restricted Subsidiary of
that Net Income is not at the date of determination permitted without any prior
governmental approval (that has not been obtained) or, directly or indirectly,
by operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Restricted Subsidiary or its stockholders, (iii) the Net Income of any Person
acquired in a pooling of interests transaction for any period prior to the date
of such acquisition shall be excluded, (iv) the cumulative effect of a change in
accounting principles shall be excluded and (v) the Net Income of any
5
Unrestricted Subsidiary shall be excluded, whether or not distributed to the
Company or one of its Restricted Subsidiaries.
"Continuing Directors" means, as of any date of determination,
any member of the Board of Directors of the Company who (i) was a member of such
Board of Directors on the Notes Issue Date or (ii) was nominated for election or
elected to such Board of Directors with the approval of a majority of the
Continuing Directors who were members of such Board at the time of such
nomination or election.
"Corporate Trust Office" means the principal office of the
Trustee at which at any time its corporate trust business shall be administered,
which office at the date hereof is located at Wachovia Bank, National
Association, 200 South Biscayne Boulevard, 14th Floor, Miami, Florida 33131,
Attention: Corporate Trust Department, or such other address as the Trustee may
designate from time to time by notice to the Holders of the Company, or the
principal corporate trust office of any successor Trustee (or such other address
as a successor Trustee may designate from time to time by notice to the Holders
and the Company).
"Credit Facility" or "Credit Facilities" means one or more
debt facilities (including, without limitation, the Senior Credit Facilities) or
commercial paper facilities with banks or other institutional lenders providing
for revolving credit loans, term loans, receivables financing (including through
the sale of receivables to such lenders or to special purpose entities formed to
borrow from such lenders against such receivables) or letters of credit, in each
case, as now in effect or at any time hereafter entered into and as amended,
restated, modified, renewed, refunded, replaced or refinanced in whole or in
part from time to time. Indebtedness under Credit Facilities outstanding on the
Notes Issue Date shall be deemed to have been incurred on such date in reliance
on the exception provided by clause (i) of the definition of Permitted Debt.
"Custodian" means the Trustee, as custodian with respect to
the Notes in global form, or any successor entity thereto.
"Debt to Cash Flow Ratio" means, with respect to any Person as
of any date of determination (the "Calculation Date"), the ratio of (a) the
Consolidated Indebtedness of such Person as of such date to (b) the Consolidated
Cash Flow of such Person for the four most recent full fiscal quarters ending
immediately prior to such date for which internal financial statements are
available, determined on a PRO FORMA basis after giving effect to all
acquisitions and dispositions of assets made by such Person and its Restricted
Subsidiaries from the beginning of such four-quarter period through and
including such date of determination (including any related financing
transactions) as if such acquisitions and dispositions had occurred at the
beginning of such four-quarter period. For purposes of making the computation
referred to above, (i) acquisitions that have been made by such Person or any of
its Restricted Subsidiaries, including through mergers or consolidations and
including any related financing transactions, during the four-quarter reference
period or subsequent to such reference period and on or prior to the Calculation
Date shall be deemed to have occurred on the first day of the four-quarter
reference period and Consolidated Cash Flow for such reference period shall be
calculated without giving effect to clause (iii) of the proviso set forth in the
definition of Consolidated Net Income and (ii) the Consolidated Cash Flow
attributable to discontinued operations, as determined in accordance with GAAP,
and operations or businesses disposed of by the Company or any of its Restricted
Subsidiaries prior to the Calculation Date, shall be excluded.
6
"Default" means any event that is or with the passage of time
or the giving of notice or both would be an Event of Default.
"Definitive Note" means a certificated Note registered in the
name of the Holder thereof and issued in accordance with Section 2.06, in the
form of Exhibit A hereto, except that such Note shall not bear the Global Note
Legend and shall not have the "Schedule of Exchanges of Interests in the Global
Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section 2.03
hereof as the Depositary with respect to the Notes, and any and all successors
thereto appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"Disqualified Stock" means any Capital Stock that, by its
terms (or by the terms of any security into which it is convertible or for which
it is exchangeable at the option of the holder thereof), or upon the happening
of any event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder thereof,
in whole or in part, on or prior to the date that is 91 days after October 15,
2013, PROVIDED, HOWEVER, that any Capital Stock that would constitute
Disqualified Stock solely because the holders thereof have the right to require
the Company to repurchase such Capital Stock upon the occurrence of a Change of
Control or an Asset Sale shall not constitute Disqualified Stock if the terms of
such Capital Stock provide that the Company may not repurchase or redeem any
such Capital Stock pursuant to such provisions unless such repurchase or
redemption complies with Section 4.07 hereof.
"Equity Interests" means Capital Stock and all warrants,
options or other rights to acquire Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital Stock).
"Euroclear" means Euroclear S.A./N.V., or its successor, as
operator of the Euroclear System.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchangeable Preferred Stock" means the Series A Preferred
Stock and the Series B Preferred Stock.
"Existing Indebtedness" means Indebtedness in existence on the
Notes Issue Date (other than Indebtedness under Credit Facilities), until such
Indebtedness is repaid.
"FCC License" means any licenses, permits and authorizations
issued by the Federal Communications Commission for the operation of stations.
"GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession, which are in effect from time to time.
"Global Notes" means a Note in the form of Exhibit A with the
Global Note Legend hereto issued in accordance with Section 2.01 or 2.06 hereof.
7
"Global Note Legend" means the legend set forth in Section
2.01(g), which is required to be placed on all Global Notes issued under this
Indenture.
"Government Securities" means direct obligations of, or
obligations guaranteed by, the United States of America, and the payment for
which the United States pledges its full faith and credit.
"Guarantee" means a guarantee (other than by endorsement of
negotiable instruments for collection in the ordinary course of business),
direct or indirect, in any manner (including, without limitation, by way of a
pledge of assets (other than pledges of Equity Interests in Unrestricted
Subsidiaries to secure Non-Recourse Debt) or through letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.
"Guarantor" means any Restricted Subsidiaries other than a
Non-Guarantor Subsidiary of the Company, that shall be required under this
Indenture to execute and deliver a Subsidiary Guarantee.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements and (ii) other
agreements or arrangements designed to protect such Person against fluctuations
in interest rates.
"Holder" means a Person in whose name a Note is registered.
"IAI Global Note" means a Global Note substantially in the
form of Exhibit A hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee sold to Institutional Accredited Investors.
"Indebtedness" means, with respect to any Person, without
duplication, (i) any indebtedness of such Person, whether or not contingent, in
respect of borrowed money or evidenced by bonds, notes, debentures or similar
instruments or letters of credit (or reimbursement agreements in respect
thereof) or banker's acceptances or representing Capital Lease Obligations or
the balance deferred and unpaid of the purchase price of any property or
representing any Hedging Obligations, except any such balance that constitutes
an accrued expense or trade payable, if and to the extent any of the foregoing
indebtedness (other than letters of credit and Hedging Obligations) would appear
as a liability upon a balance sheet of such Person prepared in accordance with
GAAP, (ii) all indebtedness of others secured by a Lien on any asset of such
Person (whether or not such indebtedness is assumed by such Person) and (iii) to
the extent not otherwise included, the guarantee by such Person of any
indebtedness of any other Person of the sort described in clause (i) of this
definition. Notwithstanding the foregoing, the term "Indebtedness" shall not
include Non-Recourse Debt or indebtedness that constitutes "Indebtedness" merely
by virtue of a pledge of Equity Interests of an Unrestricted Subsidiary.
Furthermore, for the avoidance of doubt, "Indebtedness" shall not include any
Capital Stock or any liabilities or obligations in respect of Capital Stock. The
amount of any Indebtedness outstanding as of any date shall be (A) the accreted
value thereof, in the case of any Indebtedness issued with original issue
discount, (B) the principal amount of the Indebtedness secured, together with
any interest thereon that is more than thirty (30) days past due, in the case of
8
any Indebtedness of the type described in clause (ii) above, (C) the principal
amount of the Indebtedness guaranteed, together with any interest thereon that
is more than thirty (30) days past due, in the case of any Indebtedness of the
type described in clause (iii) above, (D) the amount of the net settlement
payment payable on termination, in the case of any Indebtedness constituting a
Hedging Obligation (assuming for this purpose that the Hedging Obligation was
terminated on the date as of which the calculation of the amount of Indebtedness
is being made), and (E) the principal amount thereof, together with any interest
thereon that is more than thirty (30) days past due, in the case of any other
Indebtedness.
"Indenture" means this Indenture, as amended or supplemented
from time to time.
"Indirect Participant" means a Person who holds a beneficial
interest in a Global Note through a Participant.
"Institutional Accredited Investor" means an institution that
is an "accredited investor" as that term is defined in Rule 501(a)(1), (2), (3)
or (7) promulgated under the Securities Act.
"Investments" means, with respect to any Person, all
investments by such Person in other Persons (including Affiliates) in the forms
of direct or indirect loans (including guarantees of Indebtedness or other
obligations), advances or capital contributions (excluding commission, travel
and similar advances to officers and employees made in the ordinary course of
business), purchases or other acquisitions for consideration of Indebtedness,
Equity Interests or other securities, together with all items that are or would
be classified as investments on a balance sheet prepared in accordance with
GAAP. If the Company or any Subsidiary of the Company sells or otherwise
disposes of any Equity Interests of any direct or indirect Subsidiary of the
Company such that, after giving effect to any such sale or disposition, such
Person is no longer a Subsidiary of the Company, the Company shall be deemed to
have made an Investment on the date of any such sale or disposition equal to the
fair market value of the Equity Interests of such Subsidiary not sold or
disposed of in an amount determined as provided in the third paragraph of
Section 4.07 hereof. "Investments" does not include the defeasance, redemption
or repurchase of Indebtedness that is cancelled and not acquired or held as an
investment.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under applicable
law (including any conditional sale or other title retention agreement, any
lease in the nature thereof, any option or other agreement to sell or give a
security interest in and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction).
"Net Income" means, with respect to any Person, the net income
(loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however, (i) any
gain (but not loss), together with any related provision for taxes on such gain
(but not loss), realized in connection with (a) any Asset Sale (including,
without limitation, dispositions pursuant to sale and leaseback transactions) or
(b) the disposition of any securities by such Person or any of its Restricted
Subsidiaries or the extinguishment of any Indebtedness of such Person or any of
its Restricted Subsidiaries and (ii) any extraordinary gain (but not loss),
together with any related provision for taxes on such extraordinary gain (but
not loss).
9
"Net Proceeds" means the aggregate cash proceeds received by
the Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of
the direct costs relating to such Asset Sale or disposition (including, without
limitation, legal, accounting and investment banking fees, and sales
commissions) and any relocation expenses incurred as a result thereof, taxes
paid or payable as a result thereof (after taking into account any available tax
credits or deductions and any tax sharing arrangements), amounts required to be
applied to the repayment of Indebtedness secured by a Lien on the asset or
assets that were the subject of such Asset Sale and any reserve for indemnities,
reimbursements or adjustment in respect of the sale price of such asset or
assets established in accordance with GAAP.
"Non-Guarantor Subsidiaries" means (i) those single-purpose
Restricted Subsidiaries of the Company created or acquired after the date of
this Indenture which own one or more FCC Licenses and related rights and no
other material assets, (ii) those Subsidiaries of the Company created or
acquired after the date of the Indenture that are not incorporated under the
laws of the United States of America or a state of the United States of America,
and (iii) Subsidiaries of the Company that are not required to become and are
not guarantors of the Senior Subordinated Notes.
"Non-Recourse Debt" means Indebtedness: (i) as to which
neither the Company nor any of its Restricted Subsidiaries (a) provides credit
support of any kind (including any undertaking, agreement or instrument that
would constitute Indebtedness), (b) is directly or indirectly liable (as a
guarantor or otherwise) or (c) constitutes the lender; (ii) no default with
respect to which (including any rights that the holders thereof may have to take
enforcement action against an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other Indebtedness (other than
the Notes) of the Company or any of its Restricted Subsidiaries to declare a
default on such other Indebtedness or cause the payment thereof to be
accelerated or payable prior to its stated maturity; and (iii) as to which the
lenders have been notified in writing that they will not have any recourse to
the stock or assets of the Company or any of its Restricted Subsidiaries.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Notes" means the 10 3/4% Subordinated Exchange Notes due 2013
issued pursuant to this Indenture.
"Notes Issue Date" means the date on which the Notes are first
issued and authenticated under this Indenture in exchange for Exchangeable
Preferred Stock.
"Obligations" means any principal, interest, prepayment or
make-whole premium, penalties, fees, indemnifications, reimbursements, damages
and other liabilities payable under the documentation governing any Indebtedness
or any guarantee thereof.
"Officer" means, with respect to any Person, the Chairman of
the Board, the Chief Executive Officer, the President, the Chief Operating
Officer, the Chief Financial Officer, the Treasurer, any Assistant Treasurer,
the Controller, the Secretary or any Vice-President of such Person.
10
"Officers' Certificate" means a certificate signed on behalf
of the Company by two Officers of the Company, one of whom must be the principal
executive officer, the principal financial officer or the principal accounting
officer of the Company, that meets the requirements of Section 12.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who
is reasonably acceptable to the Trustee, that meets the requirements of Section
12.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.
"Participant" means, with respect to the Depositary, a Person
who has an account with the Depositary.
"Permitted Business" means the media business and any business
reasonably similar, complementary, ancillary or related thereto, including, the
operation of Latin music Web sites and internet portals.
"Permitted Investments" means (i) any Investment in the
Company or in a Restricted Subsidiary; (ii) any Investment in Cash Equivalents;
(iii) any Investment by the Company or any Restricted Subsidiary of the Company
in a Person engaged in a Permitted Business, if (a) as a result of, or
concurrently with, such Investment such Person becomes a Restricted Subsidiary
or (b) as a result of, or concurrently with, such Investment such Person is
merged, consolidated or amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into, the Company or a
Restricted Subsidiary; or (c) the Company or a Restricted Subsidiary has entered
into a binding agreement to acquire such Person or all or substantially all of
the assets of such Person, which agreement is in effect on the date of such
Investment, and such Person becomes a Restricted Subsidiary or such transaction
is consummated, in each case, within 180 days of the date of such Investment;
(iv) any Restricted Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and in compliance
with Section 4.10 hereof; (v) any obligations or shares of Capital Stock
received in connection with or as a result of a bankruptcy, workout or
reorganization of the issuer of such obligations or shares of Capital Stock;
(vi) any Investment received involuntarily; (vii) any acquisition of assets
solely in exchange for the issuance of Equity Interests (other than Disqualified
Stock) of the Company; (viii) other Investments in Persons engaged in Permitted
Businesses (measured on the date each such Investment was made and without
giving effect to subsequent changes in value), when taken together with all
other Investments made pursuant to this clause (viii) that are at the time
outstanding, not to exceed $7.5 million; (ix) Investments by the Company or any
of its Restricted Subsidiaries in any other Person pursuant to the terms of a
"local marketing agreement" or similar arrangement relating to a radio station
owned or licensed by such Person; (x) Hedging Obligations; (xi) the incurrence
by the Company or any of its Restricted Subsidiaries of performance, bid or
advance payment bonds, surety bonds, custom bonds, utility bonds and similar
obligations arising in the ordinary course of business; (xii) endorsements of
instruments for collection or deposit in the ordinary course of business; (xiii)
loans and advances to employees and officers not to exceed $2.5 million
outstanding in the aggregate at any time; (xiv) loans to employees, directors
and officers in connection with the purchase by such Persons of Equity Interests
of the Company; (xv) investments in account debtors received in connection with
the bankruptcy or reorganization, or in settlement of delinquent obligations, of
customers; and (xvi) investments in existence on the Notes Issue Date.
11
"Permitted Liens" means (i) Liens securing Senior Debt that
was permitted by the terms hereof to be incurred; (ii) Liens in favor of the
Company or any of its Restricted Subsidiaries; (iii) Liens on property of a
Person existing at the time such Person is merged into or consolidated with the
Company or any Restricted Subsidiary of the Company; PROVIDED that such Liens
were not incurred in contemplation of such merger or consolidation and do not
extend to any assets other than those of the Person merged into or consolidated
with the Company; (iv) Liens on property existing at the time of acquisition
thereof by the Company or any Restricted Subsidiary of the Company, PROVIDED
that such Liens were in existence prior to the contemplation of such
acquisition; (v) Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds or other obligations of a like nature
incurred in the ordinary course of business; (vi) Liens existing on the Notes
Issue Date; (vii) Liens for taxes, assessments or governmental charges or claims
that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently concluded; PROVIDED
that any reserve or other appropriate provision as shall be required in
conformity with GAAP shall have been made therefor; (viii) Liens incurred in the
ordinary course of business of the Company or any Restricted Subsidiary of the
Company with respect to obligations that do not exceed $2.5 million at any one
time outstanding; (ix) Liens securing industrial revenue bonds; (x) Liens to
secure Purchase Money Indebtedness that is otherwise permitted under the
Indenture, PROVIDED that (a) any such Lien is created solely for the purpose of
securing Indebtedness representing, or incurred to finance, refinance or refund,
the cost (including sales and excise taxes, installation and delivery charges
and other direct costs of, and other direct expenses paid or charged in
connection with, such purchase or construction) of such Property, (b) the
principal amount of the Indebtedness secured by such Lien does not exceed 100%
of such costs, and (c) such Lien does not extend to or cover any Property other
than such item of Property and any improvements on such item or proceeds
thereon; (xi) Liens securing Obligations in respect of the Senior Credit
Facilities; (xii) Liens securing Bank Indebtedness; (xiii) Liens securing
Acquisition Indebtedness, PROVIDED that such Liens do not extend to or cover any
Property other than the Property acquired with the proceeds of such Acquisition
Indebtedness and any improvements thereto; (xiv) Liens securing Permitted
Refinancing Indebtedness; (xv) Liens securing Ratio Indebtedness; (xvi) Liens to
secure Indebtedness (including Capital Lease Obligations) permitted to be
incurred by Section 4.09 covering only the assets acquired with such
Indebtedness; (xvii) zoning restrictions, easements, licenses, covenants and
other similar restrictions and encumbrances affecting the use of real property
not interfering in any material respect with the ordinary conduct of business of
the Company and its Restricted Subsidiaries; (xviii) judgment liens not giving
rise to an Event of Default; (xix) Liens, rights to setoff and credit balances
with respect to deposit accounts and other Cash Equivalents; (xx) deposits with
the owner or lessor of premises leased and operated in the ordinary course of
business; (xxi) nonconsensual liens that do not individually or in the aggregate
detract materially from the value of transferability of the assets of the
Company or any of its Restricted Subsidiaries, or impair materially the use of
any such assets in the operation of the respective businesses of the Company and
its Restricted Subsidiaries; (xxii) Liens of the Trustee under this Indenture;
and (xxiii) Liens securing Hedging Obligations.
"Permitted Refinancing Indebtedness" means any Indebtedness of
the Company or any of its Restricted Subsidiaries or any Disqualified Stock of
the Company issued in exchange for, or the net proceeds of which are used to
extend, refinance, renew, replace, defease or refund other Indebtedness of the
Company or any of its Restricted Subsidiaries; PROVIDED that: (i) the principal
12
amount (or accreted value or liquidation preference, if applicable) of such
Permitted Refinancing Indebtedness does not exceed the principal amount of (or
accreted value, if applicable), plus accrued interest on, the Indebtedness so
extended, refinanced, renewed, replaced, defeased or refunded (plus the amount
of reasonable expenses and premiums incurred in connection therewith); (ii) such
Permitted Refinancing Indebtedness has a final maturity date later than the
final maturity date of, and has a Weighted Average Life to Maturity equal to or
greater than the Weighted Average Life to Maturity of, the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; (iii) if the
Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded
is PARI PASSU with the Notes, such Permitted Refinancing Indebtedness is PARI
PASSU with or subordinated in right of payment to the Notes or is Disqualified
Stock; (iv) if the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded is subordinated in right of payment to the Notes, such
Permitted Refinancing Indebtedness is subordinated in right of payment to the
Notes on terms at least as favorable to the Holders of Notes as those contained
in the documentation governing the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded or is Disqualified Stock; and (v) such
Indebtedness is incurred either by the Company or by the Restricted Subsidiary
that is the obligor on the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded, or such Disqualified Stock is issued by the
Company, as applicable.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company or government or any agency or political subdivision
thereof (including any subdivision or ongoing business of any such entity or
substantially all of the assets of any such entity, subdivision or business).
"Principal" means Raul Alarcon, Jr.
"Private Placement Legend" means the legend set forth in
Section 2.06(g) to be place on any Restricted Definitive Note or Restricted
Global Note.
"Property" of any Person means all types of real, personal,
tangible, intangible or mixed property owned by such Person whether or not
included in the most recent consolidated balance sheet of such Person and its
Subsidiaries under GAAP.
"Purchase Money Indebtedness" means any Indebtedness incurred
in the ordinary course of business by a Person to finance the cost (including
the cost of construction) of an item of property, the principal amount of which
Indebtedness does not exceed the sum of (i) 100% of such cost and (ii)
reasonable fees and expenses of such Person incurred in connection therewith.
"Qualified Institutional Buyer" or "QIB" shall have the
meaning specified in Rule 144A.
"Ratio Indebtedness" means (i) Indebtedness of the Company
incurred in compliance with the first paragraph of the Section 4.09 which is not
Permitted Refinancing Indebtedness and (ii) any guarantee by a Restricted
Subsidiary of any Indebtedness of the Company of the type set forth in clause
(i) of this definition.
"Regulation S" means Regulation S under the Securities Act.
13
"Regulation S Global Note" means a Global Note substantially
in the form of Exhibit A hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of, and registered in the name
of, the Depositary or its nominee sold in reliance on Regulation S under the
Securities Act.
"Related Party" with respect to the Principal means (i) any
spouse or immediate family member of the Principal or (ii) any trust,
corporation, partnership or other entity, the beneficiaries, stockholders,
partners, owners or Persons beneficially holding a 50% or more controlling
interest of which consist of the Principal and/or such other Persons referred to
in the immediately preceding clause (i).
"Responsible Officer," when used with respect to the Trustee,
means any officer within the corporate trust department of the Trustee including
any vice president, assistant vice president, assistant secretary, assistant
treasurer, trust officer or any other officer of the Trustee who customarily
performs functions similar to those performed by any of the above designated
officers who at the time shall be such officers, respectively, or to whom such
matter is referred because of such person's knowledge of and familiarity with
the particular subject.
"Restricted Definitive Note" means a Definitive Note bearing
the Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the
Private Placement Legend.
"Restricted Investment" means an Investment other than a
Permitted Investment.
"Restricted Security" has the meaning assigned to such term in
Rule 144(a)(3) under the Securities Act; PROVIDED, HOWEVER, that the Trustee
shall be entitled to request and conclusively rely on an opinion of counsel with
respect to whether any Note constitutes a Restricted Security.
"Restricted Subsidiary" of a Person means any Subsidiary of
the referent Person that is not an Unrestricted Subsidiary.
"Rule 144A" means Rule 144A promulgated under the Securities
Act.
"Rule 903" means Rule 903 promulgated under the Securities
Act.
"Rule 904" means Rule 904 promulgated the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Credit Facilities" means the senior secured credit
facilities contemplated to be entered into among the Company, Lehman Brothers
Inc., Lehman Commercial Paper Inc., Merrill Lynch, Pierce Fenner & Smith
Incorporated, Deutsche Bank Securities Inc., Merrill Lynch Capital Corporation
and Deutsche Bank Trust Company Americas, as amended, restated, modified,
renewed, refunded, replaced or refinanced in whole or in part from time to time.
"Senior Subordinated Notes" means the Company's 9 5/8% Senior
Subordinated Notes due 2009.
14
"Series A Preferred Stock" means the Company's 10 3/4% Series
A Cumulative Exchangeable Redeemable Preferred Stock, par value $.01 per share,
liquidation preference $1,000 per share.
"Series B Preferred Stock" means the Company's 10 3/4% Series
B Cumulative Exchangeable Redeemable Preferred Stock, par value $.01 per share,
liquidation preference $1,000 per share.
"Significant Subsidiary" means any Restricted Subsidiary that
would be a "significant subsidiary" as defined in Article 1, Rule 1-02 of
Regulation S-X, promulgated pursuant to the Securities Act, as such Regulation
is in effect on the date hereof.
"Stated Maturity" means, with respect to any installment of
interest or principal on any series of Indebtedness, the date on which such
payment of interest or principal was scheduled to be paid in the original
documentation governing such Indebtedness, and shall not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior
to the date originally scheduled for the payment thereof.
"Subsidiary" means, with respect to any Person, any
corporation, association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
such Person or one or more of the other Subsidiaries of that Person (or a
combination thereof).
"Subsidiary Guarantee" means the Guarantee by each Guarantor
of the Company's payment obligations under this Indenture and the Notes,
executed pursuant to the provisions of this Indenture.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss.
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA, except as provided by Section 9.03 hereof.
"Trustee" means the party named as such above until a
successor replaces it in accordance with the applicable provisions of this
Indenture and thereafter means the successor serving hereunder.
"Unrestricted Definitive Note" means one or more Definitive
Notes that do not bear and are not required to bear the Private Placement
Legend.
"Unrestricted Global Note" means a permanent Global Note
substantially in the form of Exhibit A attached hereto that bears the Global
Note Legend and that has the "Schedule of Exchanges of Interests in the Global
Note" attached thereto, and that is deposited with or on behalf of and
registered in the name of the Depositary, representing a series of Notes that do
not bear and are not required to bear the Private Placement Legend.
"Unrestricted Subsidiary" means (i) any Subsidiary that is
designated by the Board of Directors as an Unrestricted Subsidiary pursuant to a
resolution of the Board of Directors, but only to the extent that such
Subsidiary: (a) has no Indebtedness other than Non-Recourse Debt; (b) is not
party to any agreement, contract, arrangement or understanding with the Company
or any Restricted Subsidiary unless the terms of any such agreement, contract,
15
arrangement or understanding are no less favorable to the Company or such
Restricted Subsidiary than those that might be obtained at the time from Persons
who are not Affiliates of the Company; (c) is a Person with respect to which
neither the Company nor any of its Restricted Subsidiaries has any direct or
indirect obligation (1) to subscribe for additional Equity Interests or (2) to
maintain or preserve such Person's financial condition or to cause such Person
to achieve any specified levels of operating results; (d) has not guaranteed or
otherwise directly or indirectly provided credit support for any Indebtedness of
the Company or any of its Restricted Subsidiaries; and (e) has at least one
director on its board of directors that is not a director or executive officer
of the Company or any of its Restricted Subsidiaries and has at least one
executive officer that is not a director or executive officer of the Company or
any of its Restricted Subsidiaries.
"U.S. Person" means a U.S. Person as defined in Rule 902(o) of
the Securities Act.
"Voting Stock" of any Person as of any date means the Capital
Stock of such Person that is at the time entitled to vote in the election of the
Board of Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (ii) the then outstanding principal
amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which (other than directors' qualifying shares)
shall at the time be owned by such Person or by one or more Wholly Owned
Restricted Subsidiaries of such Person and one or more Wholly Owned Restricted
Subsidiaries of such Person.
SECTION 1.02. OTHER DEFINITIONS.
TERM DEFINED IN SECTION
"Affiliate Transaction"...................... 4.11
"Asset Sale Offer"........................... 4.10
"Authentication Order"....................... 2.02
"Change of Control Offer".................... 4.15
"Change of Control Payment".................. 4.15
"Change of Control Payment Date"............. 4.15
"Covenant Defeasance"........................ 8.03
"Designated Senior Debt"..................... 10.02
"DTC" 2.03
"Equity Offering"............................ 3.07
"Event of Default"........................... 6.01
"Excess Proceeds"............................ 4.10
"incur"...................................... 4.09
16
"Legal Defeasance"........................... 8.02
"Notice of Default".......................... 6.01
"Offer Amount"............................... 3.09
"Offer Period"............................... 3.09
"Paying Agent"............................... 2.03
"Payment Blockage Notice".................... 10.04
"Payment Default"............................ 6.01
"Permitted Debt"............................. 4.09
"Permitted Junior Securities"................ 10.02
"Purchase Date".............................. 3.09
"Registrar".................................. 2.03
"Representative"............................. 10.02
"Restricted Payments"........................ 4.07
"Senior Debt"................................ 10.02
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the
following meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the
Trustee; and
"obligor" on the Notes and the Subsidiary Guarantees means the
Company and the Guarantors, respectively, and any successor obligor upon the
Notes and the Subsidiary Guarantees, respectively.
All other terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule under
the TIA have the meanings so assigned to them.
SECTION 1.04. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
17
(4) words in the singular include the plural, and in
the plural include the singular;
(5) provisions apply to successive events and
transactions; and
(6) references to sections of or rules under the
Securities Act shall be deemed to include substitute, replacement of successor
sections or rules adopted by the SEC from time to time.
ARTICLE II
THE NOTES
SECTION 2.01. FORM AND DATING.
(a) General. The Notes and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A hereto. The Notes
may have notations, legends or endorsements required by law, stock exchange rule
or usage. Each Note shall be dated the date of its authentication. The Notes
shall be issued in denominations of $1,000 and any integral multiple thereof;
PROVIDED, HOWEVER, that Notes may be issued in denominations of less than $1,000
upon the exchange of the applicable Exchangeable Preferred Stock for the Notes
such that each holder of Exchangeable Preferred Stock shall receive Notes in a
principal amount equal to the aggregate liquidation preference of the
Exchangeable Preferred Stock held by such holder on the Notes Issue Date, plus
accumulated but unpaid dividends thereon to the Notes Issue Date; and PROVIDED,
FURTHER, HOWEVER, that any Notes issued in lieu of cash payments of interest may
be issued in denominations of less than $1,000.
(b) The terms and provisions contained in the Notes shall
constitute, and are hereby expressly made, a part of this Indenture and the
Company, the Guarantors and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound thereby.
However, to the extent any provision of any Note conflicts with the express
provisions of this Indenture, the provisions of this Indenture shall govern and
be controlling.
(c) Global Notes. Notes issued in global form shall be
substantially in the form of Exhibit A attached hereto (including the Global
Note Legend thereon and the "Schedule of Exchanges of Interests in the Global
Note" attached thereto). Notes issued in definitive form shall be substantially
in the form of Exhibit A attached hereto (but without the Global Note Legend
thereon and without the "Schedule of Exchanges of Interests in the Global Note"
attached thereto). Each Global Note shall represent such of the outstanding
Notes as shall be specified therein and each shall provide that it shall
represent the aggregate principal amount of outstanding Notes from time to time
endorsed thereon and that the aggregate principal amount of outstanding Notes
18
represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. Any endorsement of a Global
Note to reflect the amount of any increase or decrease in the aggregate
principal amount of outstanding Notes represented thereby shall be made by the
Trustee or the Custodian, at the direction of the Trustee, in accordance with
instructions given by the Holder thereof as required by Section 2.06 hereof.
(d) Euroclear and Clearstream Procedures Applicable. The
provisions of the "Operating Procedures of the Euroclear System" and "Terms and
Conditions Governing Use of Euroclear" and the "General Terms and Conditions of
Clearstream" and "Customer Handbook" of Clearstream shall be applicable to
transfers of Regulation S Global Notes that are held by Participants through
Euroclear or Clearstream.
SECTION 2.02. EXECUTION AND AUTHENTICATION.
Two Officers shall sign the Notes for the Company by manual or
facsimile signature.
If an Officer whose signature is on a Note no longer holds
that office at the time a Note is authenticated, the Note shall nevertheless be
valid.
A Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed
by two Officers (an "Authentication Order"), authenticate Notes for original
issue in an aggregate principal amount equal to the aggregate liquidation
preference of Exchangeable Preferred Stock exchanged for the Notes on the Notes
Issue Date, plus accumulated but unpaid dividends on the Exchangeable Preferred
Stock to the Notes Issue Date, plus any additional Notes issued from time to
time in lieu of cash interest payments on the Notes, except as provided in
Section 2.07 hereof. The aggregate principal amount of Notes that may be
authenticated and delivered under the Indenture shall not exceed two hundred
eighty million dollars ($280,000,000). Notwithstanding anything in this
Indenture to the contrary or the execution and delivery of this Indenture on the
date hereof, the terms and provisions of this Indenture shall not be effective
until the consummation of an exchange pursuant to the Certificate of
Designations relating to the applicable Exchangeable Preferred Stock, except as
provided in Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to
the Company to authenticate Notes. An authenticating agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Company.
Notwithstanding the foregoing, the Trustee shall not
authenticate Notes for issuance upon exchange of the Exchangeable Preferred
Stock unless the Company shall have delivered to the Trustee the Opinion of
Counsel required by Section 8(a) of the applicable Certificate of Designations.
SECTION 2.03. REGISTRAR AND PAYING AGENT.
The Company shall maintain an office or agency where Notes may
be presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer and exchange.
19
The Company may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company shall notify
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company
("DTC") to act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the
Registrar and Paying Agent and to act as Custodian with respect to the Global
Notes.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
The Company shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent will hold in trust for the
benefit of Holders or the Trustee all money held by the Paying Agent for the
payment of principal, premium, if any, or interest on the Notes, and will notify
the Trustee of any default by the Company in making any such payment. While any
such default continues, the Trustee may require a Paying Agent to pay all money
held by it to the Trustee. The Company at any time may require a Paying Agent to
pay all money held by it to the Trustee. Upon payment over to the Trustee, the
Paying Agent (if other than the Company or a Subsidiary) shall have no further
liability for the money. If the Company or a Subsidiary acts as Paying Agent, it
shall segregate and hold in a separate trust fund for the benefit of the Holders
all money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Company, the Trustee shall serve as Paying Agent for
the Notes.
SECTION 2.05. HOLDER LISTS.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of all Holders and shall otherwise comply with TIA ss.312(a). If the
Trustee is not the Registrar, the Company shall furnish to the Trustee at least
fifteen days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of the Holders of
Notes and the Company shall otherwise comply with TIA ss.312(a).
SECTION 2.06. TRANSFER AND EXCHANGE.
(a) Transfer and Exchange of Global Notes.
A Global Note may not be transferred as a whole
except by the Depositary to a nominee of the Depositary, by a nominee of the
Depositary to the Depositary or to another nominee of the Depositary, or by the
Depositary or any such nominee to a successor Depositary or a nominee of such
successor Depositary. All Global Notes will be exchanged by the Company for
Definitive Notes if (i) the Company delivers to the Trustee notice from the
Depositary that it is unwilling or unable to continue to act as Depositary or
that it is no longer a clearing agency registered under the Exchange Act and, in
20
either case, a successor Depositary is not appointed by the Company within one
hundred twenty (120) days after the date of such notice from the Depositary or
(ii) the Company in its sole discretion determines that the Global Notes (in
whole but not in part) should be exchanged for Definitive Notes and delivers a
written notice to such effect to the Trustee. Upon the occurrence of either of
the preceding events in (i) or (ii) above, Definitive Notes shall be issued in
such names as the Depositary shall instruct the Trustee. Global Notes also may
be exchanged or replaced, in whole or in part, as provided in Sections 2.07 and
2.10 hereof. Every Note authenticated and delivered in exchange for, or in lieu
of, a Global Note or any portion thereof, pursuant to this Section 2.06 or
Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form
of, and shall be, a Global Note. A Global Note may not be exchanged for another
Note other than as provided in this Section 2.06(a), however, beneficial
interests in a Global Note may be transferred and exchanged as provided in
Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the
Global Notes.
The transfer and exchange of beneficial interests in
the Global Notes shall be effected through the Depositary, in accordance with
the provisions of this Indenture and the Applicable Procedures. Transfers of
beneficial interests in the Global Notes also shall require compliance with the
following subparagraphs:
(i) Transfer of Beneficial Interests in the Same
Global Note. Beneficial interests in any Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in such
Global Note. No written orders or instructions shall be required to be delivered
to the Registrar to effect the transfers described in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial
Interests in Global Notes. In connection with all transfers and exchanges of
beneficial interests that are not subject to Section 2.06(b)(i) above, the
transferor of such beneficial interest must deliver to the Registrar either (A)
(1) a written order from a Participant or an Indirect Participant given to the
Depositary in accordance with the Applicable Procedures directing the Depositary
to credit or cause to be credited a beneficial interest in another Global Note
in an amount equal to the beneficial interest to be transferred or exchanged and
(2) instructions given in accordance with the Applicable Procedures containing
information regarding the Participant account to be credited with such increase
or (B) (1) a written order from a Participant or an Indirect Participant given
to the Depositary in accordance with the Applicable Procedures directing the
Depositary to cause to be issued a Definitive Note in an amount equal to the
beneficial interest to be transferred or exchanged and (2) instructions given by
the Depositary to the Registrar containing information regarding the Person in
whose name such Definitive Note shall be registered to effect the transfer or
exchange referred to in (1) above. Upon satisfaction of all of the requirements
for transfer or exchange of beneficial interests in Global Notes contained in
this Indenture and the Notes or otherwise applicable under the Securities Act,
the Trustee shall adjust the principal amount of the relevant Global Note(s)
pursuant to Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests to Another
Restricted Global Note. A beneficial interest in any Restricted Global Note may
be transferred to a Person who takes delivery thereof in the form of a
21
beneficial interest in another Restricted Global Note if the transfer complies
with the requirements of Section 2.06(b)(ii) above and the Registrar receives
the following:
(A) if the transferee will take delivery in
the form of a beneficial interest in the 144A Global Note, then the transferor
must deliver a certificate in the form of Exhibit C-1 hereto, including the
certifications in item (1) thereof;
(B) if the transferee will take delivery in
the form of a beneficial interest in the Regulation S Global Note, then the
transferor must deliver a certificate in the form of Exhibit C-1 hereof,
including the certifications in item (2) thereof; and
(C) if the transferee will take delivery in
the form of a beneficial interest in the IAI Global Note, then the transferor
must deliver a certificate in the form of Exhibit C-1 hereto, including the
certifications and certificates and Opinion of Counsel required by item (3)
thereof, if applicable.
(iv) Transfer and Exchange of Beneficial Interests in
a Restricted Global Note for Beneficial Interests in the Unrestricted Global
Note. A beneficial interest in any Restricted Global Note may be exchanged by
any holder thereof for a beneficial interest in an Unrestricted Global Note or
transferred to a Person who takes delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note if the exchange or transfer complies
with the requirements of Section 2.06(b)(ii) above and the Registrar receives
the following:
(A) if the holder of such beneficial
interest in a Restricted Global Note proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global Note, a certificate
from such holder in the form of Exhibit C-2 hereto, including the certifications
in item (1) (a) thereof; or
(B) if the holder of such beneficial
interest in a Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note, a certificate from such holder in the
form of Exhibit C-1 hereto, including the certification in item (4) thereof;
and, in each such case set forth in this subparagraph (iv), an Opinion of
Counsel in form reasonably acceptable to the Registrar to the effect that such
exchange or transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private Placement Legend
are no longer required in order to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (iv)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an authentication order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (iv) above.
22
Beneficial interests in an Unrestricted Global Note cannot be
exchanged for, or transferred to Persons who take delivery thereof in the form
of, a beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for
Definitive Notes.
(i) Beneficial Interests in Restricted Global Notes
to Restricted Definitive Notes. If any holder of a beneficial interest in a
Restricted Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note or to transfer such beneficial interest to a Person
who takes delivery thereof in the form of a Restricted Definitive Note, then,
upon receipt by the Registrar of the following documentation:
(A) if the holder of such beneficial
interest in a Restricted global Note proposes to exchange such beneficial
interest for a Restricted Definitive Note, a certificate from such holder in the
form of Exhibit C-2 hereto, including the certifications in item (2) (a)
thereof;
(B) if such beneficial interest is being
transferred to a QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit C-1 hereto, including the
certifications in item (1) thereof;
(C) if such beneficial interest is being
transferred to a Non-U.S. Person in an offshore transaction in accordance with
Rule 903 or Rule 904 under the Securities Act, a certificate to the effect set
forth in Exhibit C-1 hereto, including the certifications in item (2) thereof;
(D) if such beneficial interest is being
transferred pursuant to an exemption from the registration requirements of the
Securities Act in accordance with Rule 144 under the Securities Act, a
certificate to the effect set forth in Exhibit C-1 hereto, including the
certifications in item (3) (a) thereof;
(E) if such beneficial interest is being
transferred to an Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other than those listed
in subparagraphs (B) through (D) above, a certificate to the effect set forth in
Exhibit C-1 hereto, including the certifications, certificates and Opinion of
Counsel required by item (3) thereof, if applicable;
(F) if such beneficial interest is being
transferred to the Company or any of their Subsidiaries, a certificate to the
effect set forth in Exhibit C-1 hereto, including the certifications in item (3)
(b) thereof; or
(G) if such beneficial interest is being
transferred pursuant to an effective registration statement under the Securities
Act, a certificate to the effect set forth in Exhibit C-1 hereto, including the
certifications in item (3) (c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the
Company shall execute and the Trustee shall authenticate and deliver to the
23
Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered. Any Definitive Note issued
in exchange for a beneficial interest in a Restricted Global Note pursuant to
this Section 2.06(c) (i) shall bear the Private Placement Legend and shall be
subject to all restrictions on transfer contained therein.
(ii) Beneficial Interests in Restricted Global Notes
to Unrestricted Definitive Notes. A holder of a beneficial interest in a
Restricted Global Note may exchange such beneficial interest for an Unrestricted
Definitive Note or may transfer such beneficial interest to a Person who takes
delivery thereof in the form of an Unrestricted Definitive Note only if the
Registrar receives the following:
(A) if the holder of such beneficial
interest in a Restricted Global Note proposes to exchange such beneficial
interest for a Definitive Note that does not bear the Private Placement Legend,
a certificate from such holder in the form of Exhibit C-2 hereto, including the
certifications in item (1) (b) thereof; or
(B) if the holder of such beneficial
interest in a Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form of a Definitive
Note that does not bear the Private Placement Legend, a certificate from such
holder in the form of Exhibit C-1 hereto, including the certifications in item
(4) thereof;
and, in each such case set forth in this subparagraph (ii), an Opinion of
Counsel in form reasonably acceptable to the Registrar to the effect that such
exchange or transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private Placement Legend
are no longer required in order to maintain compliance with the Securities Act.
(iii) Beneficial Interests in Unrestricted Global
Notes to Unrestricted Definitive Notes. If any holder of a beneficial interest
in an Unrestricted Global Note proposes to exchange such beneficial interest for
a Definitive Note or to transfer such beneficial interest to a Person who takes
delivery thereof in the form of a Definitive Note, the Trustee shall cause the
aggregate principal amount of the applicable Global Note to be reduced
accordingly pursuant to Section 2.06 (h) hereof, and the Company shall execute
and the Trustee shall authenticate and deliver to the Person designated in the
instructions a Definitive Note in the appropriate principal amount. Any
Definitive Note issued in exchange for a beneficial interest pursuant to this
Section 2.06 (c) (iii) shall be registered in such name or names and in such
authorized denomination or denominations as the holder of such beneficial
interest shall instruct the Registrar through instructions from the Depositary
and the Participant or Indirect Participant. The Trustee shall deliver such
Definitive Notes to the Persons in whose names such Notes are so registered. Any
Definitive Note issued in exchange for a beneficial interest pursuant to this
Section 2.06 (c) (iii) shall not bear the Private Placement Legend.
24
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests.
(i) Restricted Definitive Notes to Beneficial
Interests in Restricted Global Notes. If any Holder of a Restricted Definitive
Note proposes to exchange such Note for a beneficial interest in a Restricted
Global Note or to transfer such Restricted Definitive Notes to a Person who
takes delivery thereof in the form of a beneficial interest in a Restricted
Global Note, then, upon receipt by the Registrar of the following documentation:
(A) if the Holder of such Restricted
Definitive Note proposes to exchange such Note for a beneficial interest in a
Restricted Global Note, a certificate from such Holder in the form of Exhibit
C-2 hereto, including the certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Note is
being transferred to a QIB in accordance with Rule 144A under the Securities
Act, a certificate to the effect set forth in Exhibit C-1 hereto, including the
certifications in item (1) thereof;
(C) if such Restricted Definitive Note is
being transferred to a Non-U.S. Person in an offshore transaction in accordance
with Rule 903 or Rule 904 under the Securities Act, a certificate to the effect
set forth in Exhibit C-1 hereto, including the certifications in item (2)
thereof;
(D) if such Restricted Definitive Note is
being transferred pursuant to an exemption from the registration requirements of
the Securities Act in accordance with Rule 144 under the Securities Act, a
certificate to the effect set forth in Exhibit C-1 hereto, including the
certifications in item (3) (a) thereof;
(E) if such Restricted Definitive Note is
being transferred to an Institutional Accredited Investor in reliance on an
exemption from the registration requirements of the Securities Act other than
those listed in subparagraphs (B) through (D) above, a certificate to the effect
set forth in Exhibit C-1 hereto, including the certifications, certificates and
Opinion of Counsel required by item (3)(d) thereof, if applicable;
(F) if such Restricted Definitive Note is
being transferred to the Company or any of their Subsidiaries, a certificate to
the effect set forth in Exhibit C-1 hereto, including the certifications in item
(3) (b) thereof; or
(G) if such Restricted Definitive Note is
being transferred pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in Exhibit C-1 hereto,
including the certifications in item (3) (c) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or cause to be
increased the aggregate principal amount of, in the case of clause (A) above,
the appropriate Restricted Global Note, in the case of clause (B) above, the
144A Global Note, in the case of clause (C) above, the Regulation S Global Note,
and in all other cases, the IAI Global Note.
(ii) Restricted Definitive Notes to Beneficial
Interests in Unrestricted Global Notes. A Holder of a Restricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted Global Note
or transfer such Restricted Definitive Note to a Person who takes delivery
25
thereof in the form of a beneficial interest in an Unrestricted Global Note only
if the Registrar receives the following:
(A) if the Holder of such Definitive Notes
proposes to exchange such Notes for a beneficial interest in the Unrestricted
Global Note, a certificate from such Holder in the form of Exhibit C-2 hereto,
including the certifications in item (1) (c) thereof; or
(B) if the Holder of such Definitive Notes
proposes to transfer such Notes to a Person who shall take delivery thereof in
the form of a beneficial interest in the Unrestricted Global Note, a certificate
from such Holder in the form of Exhibit C-1 hereto, including the certifications
in item (4) thereof;
and, in each such case set forth in this subparagraph (ii), an Opinion of
Counsel in form reasonably acceptable to the Registrar to the effect that such
exchange or transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private Placement Legend
are no longer required in order to maintain compliance with the Securities Act.
Upon satisfaction of the conditions of this subparagraph (ii), the Trustee shall
cancel the Definitive Notes and increase or cause to be increased the aggregate
principal amount of the Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial
Interests in Unrestricted Global Notes. A Holder of an Unrestricted Definitive
Note may exchange such Note for a beneficial interest in an Unrestricted Global
Note or transfer such Definitive Notes to a Person who takes delivery thereof in
the form of a beneficial interest in an Unrestricted Global Note at any time.
Upon receipt of a request for such an exchange or transfer, the Trustee shall
cancel the applicable Unrestricted Definitive Note and increase or cause to be
increased the aggregate principal amount of one of the Unrestricted Global
Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (ii) or (iii) above at
a time when an Unrestricted Global Note has not yet been issued, the Company
shall issue and, upon receipt of an authentication order in accordance with
Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted
Global Notes in an aggregate principal amount equal to the principal amount of
Definitive Notes so transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive
Notes. Upon request by a Holder of Definitive Notes and such Holder's compliance
with the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder shall present or surrender to the Registrar
the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).
26
(i) Restricted Definitive Notes to Restricted
Definitive Notes. Any Restricted Definitive Note may be transferred to and
registered in the name of Persons who take delivery thereof in the form of a
Restricted Definitive Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to
Rule 144A under the Securities Act, then the transferor must deliver a
certificate in the form of Exhibit C-1 hereto, including the certifications in
item (1) thereof;
(B) if the transfer will be made pursuant to
Rule 903 or Rule 904, then the transferor must deliver a certificate in the form
of Exhibit C-1 hereto, including the certifications in item (2) thereof; and
(C) if the transfer will be made pursuant to
any other exemption from the registration requirements of the Securities Act,
then the transferor must deliver a certificate in the form of Exhibit C-1
hereto, including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable.
(ii) Restricted Definitive Notes to Unrestricted
Definitive Notes. Any Restricted Definitive Note may be exchanged by the Holder
thereof for an Unrestricted Definitive Note or transferred to a Person or
Persons who take delivery thereof in the form of an Unrestricted Definitive Note
if the Registrar receives the following:
(A) if the Holder of such Restricted
Definitive Notes proposes to exchange such Notes for an Unrestricted Definitive
Note, a certificate from such Holder in the form of Exhibit C-2 hereto,
including the certifications in item (1) (d) thereof; or
(B) if the Holder of such Restricted
Definitive Notes proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of an Unrestricted Definitive Note, a certificate
from such Holder in the form of Exhibit C-1 hereto, including the certifications
in item (4) thereof;
and, in each such case set forth in this subparagraph (ii), an Opinion of
Counsel in form reasonably acceptable to the Company to the effect that such
exchange or transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private Placement Legend
are no longer required in order to maintain compliance with the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted
Definitive Notes. A Holder of Unrestricted Definitive Notes may transfer such
Notes to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note. Upon receipt of a request to register such a transfer, the
Registrar shall register the Unrestricted Definitive Notes pursuant to the
instructions from the Holder thereof.
(f) Initial Issuances of Notes. Upon the exchange of the
Series A Preferred Stock for Notes in accordance with the terms set forth in the
Certificate of Designations for the Series A Preferred Stock, the Company shall
issue and, upon receipt of an authentication order in accordance with Section
2.02, the Trustee shall authenticate (i) one or more Restricted Global Notes or
27
Regulation S Global Notes, as applicable, and (ii) Restricted Definitive Notes.
Upon the exchange of the Series B Preferred Stock for Notes in accordance with
the terms set forth in the Certificate of Designations for the Series B
Preferred Stock, the Company shall issue and, upon receipt of an authentication
order in accordance with Section 2.02, the Trustee shall authenticate one or
more Unrestricted Global Notes and (ii) Unrestricted Definitive Notes.
(g) Legends. The following legends shall appear on the face of
all Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B)
below, each Global Note and each Definitive Note (and all Notes issued in
exchange therefor or substitution thereof) shall bear the legend in
substantially the following form:
"THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933 (THE "SECURIRIES ACT") AND MAY NOT BE OFFERED,
SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE
903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (3) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE), (4) TO AN INSTITUTIONAL ACCREDITED INVESTOR IN A
TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, (5)
IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT (BASED UPON AN OPINION OF COUNSEL IF THE COMPANY SO REQUESTS) OR
(6) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND
(B) IN ACCORDANCE WITH ALL APPLICABLE BLUE SKY LAWS OF THE STATES OF THE UNITED
STATES, AND THE HOLDER OF THIS SECURITY AGREES THAT IT WILL DELIVER TO EACH
PERSON TO WHOM THIS SECURITY OR AN INTEREST THEREIN IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND."
(B) Notwithstanding the foregoing, any
Global Note or Definitive Note issued pursuant to subparagraphs (b) (iv), (c)
(ii), (c) (iii), (d) (ii), (d) (iii), (e) (ii) of (e) (iii) or the second
sentence of subparagraph (f) to this Section 2.06 (and all Notes issued in
exchange therefor or substitution thereof) shall not bear the Private Placement
Legend.
(ii) Global Note Legend. Each Global Note shall bear
a legend in substantially the following form:
"Unless and until it is exchanged in whole or in part for
Notes in definitive form, this Note may not be transferred except as a whole by
28
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. Unless this certificate is presented by an authorized representative
of The Depository Trust Company (55 Water Street, New York, New York) ("DTC") to
the Company (as defined below) or their agent for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of
Cede & Co. or such other name as may be requested by an authorized
representative of DTC (and any payment is made to Cede & Co. or such other
entity as may be requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein."
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE,
(III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO
A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY."
(h) Cancellation and/or Adjustment of Global Notes. At such
time as all beneficial interests in a particular Global Note have been exchanged
for Definitive Notes or a particular Global Note has been redeemed, repurchased
or canceled in whole and not in part, each such Global Note shall be returned to
or retained and canceled by the Trustee in accordance with Section 2.11 hereof.
At any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for or transferred to a Person who will take delivery thereof
in the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and
exchanges, the Company shall execute and the Trustee shall authenticate Global
Notes and Definitive Notes upon the Company's order or at the Registrar's
request.
(ii) No service charge shall be made to a holder of a
beneficial interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Company may require payment of a
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sum sufficient to cover any transfer tax or similar governmental charge payable
in connection therewith (other than any such transfer taxes or similar
governmental charge payable upon exchange or transfer pursuant to Sections 2.10,
3.06, 3.09, 4.10, 4.15 and 9.05 hereof).
(iii) The Registrar shall not be required to register
the transfer of or exchange any Note selected for redemption in whole or in
part, except the unredeemed portion of any Note being redeemed in part.
(iv) All Global Notes and Definitive Notes issued
upon any registration of transfer or exchange of Global Notes or Definitive
Notes shall be the valid obligations of the Company, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Global Notes or
Definitive Notes surrendered upon such registration of transfer or exchange.
(v) The Company shall not be required (A) to issue,
to register the transfer of or to exchange any Notes during a period beginning
at the opening of business 15 days before the day of mailing of a notice of
redemption of Notes selected for redemption under Section 3.02 hereof and ending
at the close of business on the day of such mailing, (B) to register the
transfer of or to exchange any Note so selected for redemption in whole or in
part, except the unredeemed portion of any Note being redeemed in part or (C) to
register the transfer of or to exchange a Note between a record date and the
next succeeding interest payment date.
(vi) Prior to due presentment for the registration of
a transfer or any Note, the Trustee, any Agent and the Company may deem and
treat the Person in whose name any Note is registered as the absolute owner of
such Note for the purpose of receiving payment of principal of and interest on
such Notes and for all other purposes, and none of the Trustee, any Agent or the
Company shall be affected by notice to the contrary.
(vii) The Trustee shall authenticate Global Notes and
Definitive Notes in accordance with the provisions of Section 2.02 hereof.
(viii) All certifications, certificates and Opinions
of Counsel required to be submitted to the Registrar pursuant to this Section
2.06 to effect a registration of transfer or exchange may be submitted initially
by facsimile, to be followed by originals. The Trustee is authorized to rely
conclusively and to act upon receipt of facsimile certifications, certificates,
and Opinions of Counsel delivered pursuant to this Section 2.06.
SECTION 2.07. REPLACEMENT NOTES.
If any mutilated Note is surrendered to the Trustee or the
Company and the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Note, the Company shall issue and the Trustee,
upon receipt of an Authentication Order, shall authenticate a replacement Note
if the Trustee's requirements are met. If a Note is destroyed, lost or stolen,
an indemnity bond must be supplied by the Holder that is sufficient in the
reasonable judgment of the Trustee and the Company to protect the Company, the
Trustee, any Agent and any authenticating agent from any loss that any of them
may suffer if a Note is replaced. The Company may charge for its expenses in
replacing a Note.
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Every replacement Note is an additional obligation of the
Company and shall be entitled to all of the benefits of this Indenture equally
and proportionately with all other Notes duly issued hereunder.
SECTION 2.08. OUTSTANDING NOTES.
The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those canceled by it, those delivered to
it for cancellation, those reductions in the interest in a Global Note effected
by the Trustee in accordance with the provisions hereof, and those described in
this Section as not outstanding. Except as set forth in Section 2.09 hereof, a
Note does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Note; however, Notes held by the Company or a Subsidiary of
the Company shall not be deemed to be outstanding for purposes of Section
3.07(b) hereof.
If a Note is replaced pursuant to Section 2.07 hereof, it
ceases to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under
Section 4.01 hereof, it ceases to be outstanding and interest on it ceases to
accrue.
If the Paying Agent (other than the Company, a Subsidiary or
an Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
SECTION 2.09. TREASURY NOTES.
In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, waiver or consent, Notes owned
by the Company, or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company, shall
be considered as though not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes that a Responsible Officer of the
Trustee actually knows are so owned shall be so disregarded. The Company agrees
to notify the Trustee of the existence of any Notes owned by the Company, any
Guarantor, or, to the extent known by the Company, any Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company or any Guarantor.
SECTION 2.10. TEMPORARY NOTES.
Until certificates representing Notes are ready for delivery,
the Company may prepare and the Trustee, upon receipt of an Authentication
Order, shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form, and shall carry all rights, of certificated Notes but
may have variations that the Company considers appropriate for temporary Notes
and as shall be reasonably acceptable to the Trustee.
Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate definitive Notes in exchange for temporary Notes.
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Holders of temporary Notes shall be entitled to all of the
benefits of this Indenture.
SECTION 2.11. CANCELLATION.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Notes surrendered to them for registration of transfer, exchange or payment.
The Trustee and no one else shall cancel all Notes surrendered for registration
of transfer, exchange, payment, replacement or cancellation and shall dispose of
such cancelled Notes in accordance with its customary procedures subject to any
requirements imposed by law. The Company may not issue new Notes to replace
Notes that it has paid or that have been delivered to the Trustee for
cancellation.
SECTION 2.12. DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Notes,
it shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.01 hereof. The Company shall notify the Trustee in
writing of the amount of defaulted interest proposed to be paid on each Note and
the date of the proposed payment. The Company shall fix or cause to be fixed
each such special record date and payment date; PROVIDED that no such special
record date shall be less than 10 days prior to the related payment date for
such defaulted interest. At least fifteen (15) days before the special record
date, the Company (or, upon the written request of the Company, the Trustee in
the name and at the expense of the Company) shall mail or cause to be mailed to
Holders a notice that states the special record date, the related payment date
and the amount of such interest to be paid.
SECTION 2.13. CUSIP NUMBERS.
The Company in issuing the Notes may use "CUSIP" numbers (if
then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in
notices of redemption as a convenience to Holders; PROVIDED that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Notes or as contained in any notice of a redemption and
that reliance may be placed only on the other identification numbers printed on
the Notes, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Company will promptly notify the Trustee of any
change in the "CUSIP" numbers.
ARTICLE III
REDEMPTION AND PREPAYMENT
SECTION 3.01. NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least forty five (45) days but not more than sixty (60) days before a
redemption date, an Officers' Certificate setting forth (i) the clause of this
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Indenture pursuant to which the redemption shall occur, (ii) the redemption
date, (iii) the principal amount of Notes to be redeemed, (iv) the redemption
price, and (v) the CUSIP numbers of the Notes to be redeemed.
If the Company is required to make an offer to purchase Notes
pursuant to the provisions of Section 3.09 or 4.15 hereof, it shall furnish to
the Trustee an Officers' Certificate setting forth (i) the Section of this
Indenture pursuant to which the purchase shall occur, (ii) the purchase date,
(iii) the principal amount of Notes to be purchased, (iv) the purchase price and
(v) a statement to the effect that (a) the Company or one of its Subsidiaries
has effected an Asset Sale and the conditions set forth in Sections 3.09 and
4.10 have been satisfied or (b) a Change of Control has occurred and the
conditions set forth in Section 4.15 have been satisfied, as applicable.
SECTION 3.02. SELECTION OF NOTES TO BE REDEEMED.
If less than all of the Notes are to be redeemed or purchased
in an offer to purchase at any time, the Trustee shall select the Notes to be
redeemed or purchased among the Holders of the Notes in compliance with the
requirements of the principal national securities exchange, if any, on which the
Notes are listed or, if the Notes are not so listed, on a PRO RATA basis, by lot
or in accordance with any other method the Trustee considers fair and
appropriate. In the event of partial redemption by lot, the particular Notes to
be redeemed shall be selected, unless otherwise provided herein, not less than
thirty (30) nor more than sixty (60) days prior to the redemption date by the
Trustee from the outstanding Notes not previously called for redemption.
The Trustee shall promptly notify the Company in writing of
the Notes selected for redemption and, in the case of any Note selected for
partial redemption, the principal amount thereof to be redeemed. Notes and
portions of Notes selected shall be in amounts of $1,000 or whole multiples of
$1,000; except that if all of the Notes of a Holder are to be redeemed, the
entire outstanding amount of Notes held by such Holder, even if not a multiple
of $1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
SECTION 3.03. NOTICE OF REDEMPTION.
Subject to the provisions of Section 3.09 hereof, at least
thirty (30) days but not more than sixty (60) days before a redemption date, the
Company shall mail or cause to be mailed, by first class mail, a notice of
redemption to each Holder whose Notes are to be redeemed at its registered
address.
The notice shall identify the Notes to be redeemed, including
the CUSIP numbers, and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption date
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upon surrender of such Note, a new Note or Notes in principal amount equal to
the unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to
the Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such
redemption payment, interest on Notes called for redemption ceases to accrue on
and after the redemption date;
(g) the paragraph of the Notes and/or Section of this
Indenture pursuant to which the Notes called for redemption are being redeemed;
and
(h) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed on the
Notes.
At the Company's request, the Trustee shall give the
notice of redemption in the Company's name and at its expense; PROVIDED,
HOWEVER, that the Company shall have delivered to the Trustee, at least forty
five (45) days prior to the redemption date, an Officers' Certificate requesting
that the Trustee give such notice and setting forth the information to be stated
in such notice as provided in the preceding paragraph.
SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section
3.03 hereof, Notes called for redemption become irrevocably due and payable on
the redemption date at the redemption price. A notice of redemption may not be
conditional.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE.
One (1) Business Day prior to the redemption date, the Company
shall deposit with the Trustee or with the Paying Agent money sufficient to pay
the redemption price of and accrued interest on all Notes to be redeemed on that
date. The Trustee or the Paying Agent shall promptly return to the Company any
money deposited with the Trustee or the Paying Agent by the Company in excess of
the amounts necessary to pay the redemption price of, and accrued interest on,
all Notes to be redeemed.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue on
the Notes or the portions of Notes called for redemption. If a Note is redeemed
on or after an interest record date but on or prior to the related interest
payment date, then any accrued and unpaid interest shall be paid to the Person
in whose name such Note was registered at the close of business on such record
date. If any Note called for redemption shall not be so paid upon surrender for
redemption because of the failure of the Company to comply with the preceding
paragraph, interest shall be paid on the unpaid principal, from the redemption
date until such principal is paid, and to the extent lawful on any interest not
paid on such unpaid principal, in each case at the rate provided in the Notes
and in Section 4.01 hereof.
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SECTION 3.06. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Company
shall issue and, upon the Company's written request, the Trustee shall
authenticate for the Holder at the expense of the Company a new Note equal in
principal amount to the unredeemed portion of the Note surrendered.
SECTION 3.07. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Section 3.07,
the Company shall not have the option to redeem the Notes pursuant to this
Section 3.07 prior to October 15, 2008. On or after October 15, 2008, the
Company shall have the option to redeem the Notes, in whole or, from time to
time in part, upon not less than thirty (30) nor more than sixty (60) days'
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below, plus accrued and unpaid interest, if any, thereon to the
applicable redemption date, if redeemed during the twelve-month period beginning
on October 15 of the years indicated below:
YEAR PERCENTAGE
2008................................ 105.375%
2009................................ 103.583%
2010................................ 101.792%
2011 and thereafter................. 100.000%
(b) In addition to the foregoing, prior to October 15, 2006,
the Company may, on any one or more occasions, redeem up to 40% of the aggregate
principal amount of Notes (whether issued in exchange for the Exchangeable
Preferred Stock or issued in lieu of cash interest payments) at a redemption
price of 110.75% of the principal amount thereof, plus accrued and unpaid
interest thereon to the redemption date, with the net cash proceeds of an Equity
Offering; PROVIDED that (i) at least $45.0 million of the aggregate principal
amount of the Notes (whether issued in exchange for the Exchangeable Preferred
Stock or issued in lieu of cash interest payments) remain outstanding
immediately after the occurrence of each such redemption (excluding Notes held
by the Company and its Subsidiaries) and (ii) each such redemption shall occur
within ninety (90) days after the date of the closing of any such Equity
Offering.
(c) Notwithstanding the foregoing, no optional redemption may
be authorized or made by the Company at a redemption price less than 101% of the
principal amount of the Notes at any time that the Company is making an offer to
purchase Notes under a Change of Control Offer in accordance with Section 4.15
hereof.
(d) For the purposes of this Section 3.07, "Equity Offering"
means (i) any public or private sale of the common stock of the Company pursuant
to which the Company receives net proceeds of at least $15.0 million other than
issuances of common stock of the Company pursuant to employee benefits plans or
as compensation to employees or (ii) the issuance of shares of the Company's
Class A common stock, par value $.0001 per share, upon exercise of the warrants
granted to International Church of the FourSquare Gospel pursuant to which the
Company receives net proceeds of at least $5.0 million.
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(e) Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Section 3.01 through 3.06 hereof.
SECTION 3.08. MANDATORY REDEMPTION.
The Company shall not be required to make mandatory redemption
payments with respect to the Notes.
SECTION 3.09. OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS.
In the event that, pursuant to Section 4.10 hereof, the
Company shall be required to commence an Asset Sale Offer, it shall follow the
procedures specified below.
The Asset Sale Offer shall remain open for a period of twenty
(20) Business Days following its commencement and no longer, except to the
extent that a longer period is required by applicable law (the "Offer Period").
No later than five Business Days after the termination of the Offer Period (the
"Purchase Date"), the Company shall purchase the principal amount of Notes
required to be purchased pursuant to Section 4.10 hereof (the "Offer Amount")
or, if less than the Offer Amount has been tendered, all Notes tendered in
response to the Asset Sale Offer. Payment for any Notes so purchased shall be
made in the same manner as interest payments are made.
If the Purchase Date is on or after an interest record date
and on or before the related interest payment date, any accrued and unpaid
interest shall be paid to the Person in whose name a Note is registered at the
close of business on such record date, and no additional interest shall be
payable to Holders who tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, the Company
shall send, by first class mail, a notice to the Trustee and each of the
Holders. The notice shall contain all instructions and materials necessary to
enable such Holders to tender Notes pursuant to the Asset Sale Offer. The Asset
Sale Offer shall be made to all Holders. The notice, which shall govern the
terms of the Asset Sale Offer, shall state:
(a) that the Asset Sale Offer is being made pursuant to this
Section 3.09 and Section 4.10 hereof and the length of time the Asset Sale Offer
shall remain open;
(b) the Offer Amount, the purchase price and the Purchase
Date;
(c) that any Note not tendered or accepted for payment shall
continue to accrete or accrue interest;
(d) that, unless the Company defaults in making such payment,
any Note accepted for payment pursuant to the Asset Sale Offer shall cease to
accrete or accrue interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to
an Asset Sale Offer may only elect to have all of such Note purchased and may
not elect to have only a portion of such Note purchased;
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(f) that Holders electing to have a Note purchased pursuant to
any Asset Sale Offer shall be required to surrender the Note, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, or transfer by book-entry transfer, to the Company, a depositary, if
appointed by the Company, or a Paying Agent at the address specified in the
notice at least three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election
if the Company, the depositary or the Paying Agent, as the case may be,
receives, not later than the expiration of the Offer Period, a facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Note purchased;
(h) that, if the aggregate principal amount of Notes
surrendered by Holders exceeds the Offer Amount, the Company shall select the
Notes to be purchased on a PRO RATA basis (with such adjustments as may be
deemed appropriate by the Company so that only Notes in denominations of $1,000,
or integral multiples thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in part shall
be issued new Notes equal in principal amount to the unpurchased portion of the
Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company shall, to
the extent lawful, accept for payment, on a PRO RATA basis to the extent
necessary, the Offer Amount of Notes or portions thereof tendered pursuant to
the Asset Sale Offer, or if less than the Offer Amount has been tendered, all
Notes tendered, and shall deliver to the Trustee an Officers' Certificate
stating that such Notes or portions thereof were accepted for payment by the
Company in accordance with the terms of this Section 3.09. The Company, the
Depositary or the Paying Agent, as the case may be, shall promptly (but in any
case not later than five (5) days after the Purchase Date) mail or deliver to
each tendering Holder an amount equal to the purchase price of the Notes
tendered by such Holder and accepted by the Company for purchase, and the
Company shall promptly issue a new Note, and the Trustee, upon written request
from the Company shall authenticate and mail or deliver such new Note to such
Holder, in a principal amount equal to any unpurchased portion of the Note
surrendered. Any Note not so accepted shall be promptly mailed or delivered by
the Company to the Holder thereof. The Company shall publicly announce the
results of the Asset Sale Offer on the Purchase Date.
Other than as specifically provided in this Section
3.09, any purchase pursuant to this Section 3.09 shall be made pursuant to the
provisions of Sections 3.01 through 3.06 hereof.
ARTICLE IV
COVENANTS
SECTION 4.01. PAYMENT OF NOTES.
The Company or a Guarantor shall pay or cause to be paid the
principal of, premium, if any, and interest, on the Notes on the dates and in
the manner provided in the Notes. Principal, premium, if any, and interest, if
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any, shall be considered paid on the date due if the Paying Agent, if other than
the Company or a Subsidiary thereof, holds as of 10:00 a.m. Eastern Time on the
due date money deposited by the Company in immediately available funds and
designated for and sufficient to pay all principal, premium, if any, and
interest, then due.
The Company or a Guarantor shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal at the rate equal to 1% per annum in excess of the then applicable
interest rate on the Notes to the extent lawful; it shall pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue installments of interest (without regard to any applicable grace period)
at the same rate to the extent lawful.
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.
The Company shall maintain in the Borough of Manhattan, City
of New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Company in respect of the Notes and this Indenture may be
served. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office.
The Company may also from time to time designate one or more
other offices or agencies where the Notes may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations;
PROVIDED, HOWEVER, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, City of New York for such purposes. The Company shall give
prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office as
one such office or agency of the Company in accordance with Section 2.03.
SECTION 4.03. REPORTS.
Whether or not required by the rules and regulations of the
SEC, so long as any Notes are outstanding, the Company shall furnish to the
Trustee and the Holders of Notes (i) all quarterly and annual financial
information that would be required to be contained in a filing with the SEC on
Forms 10-Q and 10-K if the Company were required to file such forms, including a
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" that describes the financial condition and results of operations of
the Company and its consolidated Subsidiaries (showing in reasonable detail,
either on the face of the financial statements or in the footnotes thereto and
in Management's Discussion and Analysis of Financial Condition and Results of
Operations, the financial condition and results of operations of the Company and
its Restricted Subsidiaries separate from the financial information and results
of operations of the Unrestricted Subsidiaries of the Company) and, with respect
to the annual information only, a report thereon by the Company's certified
independent accountants and (ii) all current reports that would be required to
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be filed with the SEC on Form 8-K if the Company were required to file such
reports, in each case, within the time periods specified in the SEC's rules and
regulations. In addition, whether or not required by the rules and regulations
of the SEC, the Company shall file a copy of all such information and reports
with the SEC for public availability within the time periods specified in the
SEC's rules and regulations (unless the SEC will not accept such a filing) and
make such information available to securities analysts and prospective investors
upon request. The Company shall at all times comply with TIA ss.314(a). Delivery
of such reports, information and documents to the Trustee is for informational
purposes only and the Trustee's receipt of such reports, information and
documents shall not constitute constructive notice of any information contained
therein or determinable from the 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 4.04. COMPLIANCE CERTIFICATE.
(a) The Company and each Guarantor (to the extent that such
Guarantor is so required under the TIA) shall deliver to the Trustee, within
ninety (90) days after the end of each fiscal year, an Officers' Certificate
stating that a review of the activities of the Company and its Subsidiaries
during the preceding fiscal year has been made under the supervision of the
signing Officers with a view to determining whether the Company has kept,
observed, performed and fulfilled its obligations under this Indenture, and
further stating, as to each such Officer signing such certificate, that to the
best of his or her knowledge the Company has kept, observed, performed and
fulfilled each and every covenant contained in this Indenture and is not in
default in the performance or observance of any of the terms, provisions and
conditions of this Indenture (or, if a Default or Event of Default shall have
occurred, describing all such Defaults or Events of Default of which he or she
may have knowledge and what action the Company is taking or proposes to take
with respect thereto) and that to the best of his or her knowledge no event has
occurred and remains in existence by reason of which payments on account of the
principal of or interest, if any, on the Notes is prohibited or if such event
has occurred, a description of the event and what action the Company is taking
or proposes to take with respect thereto.
(b) So long as not contrary to the then current
recommendations of the American Institute of Certified Public Accountants, the
year-end financial statements delivered pursuant to Section 4.03(a) above shall
be accompanied by a written statement of the Company's independent public
accountants (who shall be a firm of established national reputation) that in
making the examination necessary for certification of such financial statements,
nothing has come to their attention that would lead them to believe that the
Company has violated any provisions of Article 4 or Article 5 hereof or, if any
such violation has occurred, specifying the nature and period of existence
thereof, it being understood that such accountants shall not be liable directly
or indirectly to any Person for any failure to obtain knowledge of any such
violation.
(c) The Company shall, so long as any of the Notes are
outstanding, deliver to the Trustee, forthwith upon any Officer becoming aware
of any Default or Event of Default, an Officers' Certificate specifying such
Default or Event of Default and what action the Company is taking or proposes to
take with respect thereto.
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SECTION 4.05. TAXES.
The Company shall pay, and shall cause each of its
Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and
governmental levies except such as are contested in good faith and by
appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders of the Notes.
SECTION 4.06. STAY, EXTENSION AND USURY LAWS.
The Company and each of the Guarantors covenants (to the
extent that it may lawfully do so) that it shall not at any time insist upon,
plead, or in any manner whatsoever claim or take the benefit or advantage of,
any stay, extension or usury law wherever enacted, now or at any time hereafter
in force, that may affect the covenants or the performance of this Indenture;
and the Company and each of the Guarantors (to the extent that it may lawfully
do so) hereby expressly waives all benefit or advantage of any such law, and
covenants that it shall not, by resort to any such law, hinder, delay or impede
the execution of any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law has been enacted.
SECTION 4.07. RESTRICTED PAYMENTS.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly: (i) declare or pay any
dividend or make any other payment or distribution on account of the Company's
or any of its Restricted Subsidiary's Equity Interests (including, without
limitation, any payment in connection with any merger or consolidation involving
the Company or any Restricted Subsidiary) or to any direct or indirect holders
of the Company's Equity Interests in their capacity as such (other than
dividends or distributions (a) payable in Equity Interests (other than
Disqualified Stock) of the Company or (b) to the Company or any Wholly Owned
Restricted Subsidiary of the Company); (ii) purchase, redeem or otherwise
acquire or retire for value (including, without limitation, in connection with
any merger or consolidation involving the Company) any Equity Interests of the
Company or any of its Restricted Subsidiaries or any direct or indirect parent
of the Company (other than any such Equity Interests owned by the Company or any
Restricted Subsidiary of the Company or Permitted Investments); (iii) make any
payment on or with respect to, or purchase, redeem, defease or otherwise acquire
or retire for value any Indebtedness of the Company or any Restricted Subsidiary
that is subordinated to the Notes or any guarantee of the Notes, except a
payment of interest or principal at Stated Maturity; or (iv) make any Restricted
Investment (all such payments and other actions set forth in clauses (i) through
(iv) above being collectively referred to as "Restricted Payments"), unless, at
the time of and after giving effect to such Restricted Payment:
(a) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; and
(b) the Company would, at the time of such Restricted Payment
and after giving pro forma effect thereto as if such Restricted Payment had been
made at the beginning of the applicable four-quarter period, have been permitted
40
to incur at least $1.00 of additional Indebtedness pursuant to the Debt to Cash
Flow Ratio test set forth in the first paragraph of Section 4.09 hereof, and
(c) such Restricted Payment, together with the aggregate
amount of all other Restricted Payments made by the Company and its Restricted
Subsidiaries after the Notes Issue Date (excluding Restricted Payments permitted
by clauses (ii), (iii) and (iv) of the next succeeding paragraph), is less than
the sum, without duplication, of (i) an amount equal to the Consolidated Cash
Flow of the Company for the period (taken as one accounting period) from June 8,
2001 to the end of the Company's most recently ended full fiscal quarter for
which financial statements have been filed with the SEC (the "Basket Period")
less the product of 1.4 times the Consolidated Interest Expense of the Company
for the Basket Period), plus (ii) 100% of the aggregate net cash proceeds
received by the Company as a contribution to its common equity capital or from
the issue or sale since June 8, 2001 of Equity Interests of the Company (other
than Disqualified Stock) or from the issue or sale of Disqualified Stock or debt
securities of the Company that have been converted into such Equity Interests
(other than Equity Interests (or Disqualified Stock or convertible debt
securities) sold to a Subsidiary of the Company and other than Disqualified
Stock or convertible debt securities that have been converted into Disqualified
Stock), plus (iii) to the extent that any Restricted Investment that was made
after the Notes Issue Date is sold for cash or otherwise liquidated or repaid
for cash, the lesser of (A) the cash return of capital with respect to such
Restricted Investment (less the cost of disposition, if any) and (B) the initial
amount of such Restricted Investment.
The foregoing provisions will not prohibit (i) the payment of
any dividend within sixty (60) days after the date of declaration thereof, if at
the date of declaration such payment would have complied with the provisions of
this Indenture; (ii) the redemption, repurchase, retirement, defeasance or other
acquisition of any Equity Interests of Company or subordinated Indebtedness of
the Company or any Guarantor in exchange for, or out of the net cash proceeds of
the substantially concurrent sale (other than to a Subsidiary of the Company)
of, other Equity Interests of the Company (other than any Disqualified Stock);
PROVIDED that the amount of any such net cash proceeds that are utilized for any
such redemption, repurchase, retirement, defeasance or other acquisition shall
be excluded from clause (c)(ii) of the preceding paragraph; and, PROVIDED
FURTHER, that no Default or Event of Default shall have occurred and be
continuing immediately after such transaction; (iii) the defeasance, redemption,
repurchase or other acquisition of any Indebtedness of the Company or any
Restricted Subsidiary that is subordinated in right of payment to the Notes with
the net cash proceeds from an incurrence of Permitted Refinancing Indebtedness;
PROVIDED that no Default or Event of Default shall have occurred and be
continuing immediately after such transaction; (iv) the payment of any dividend
by a Restricted Subsidiary of the Company to the holders of Equity Interests on
a PRO RATA basis; (v) the repurchase, redemption or other acquisition or
retirement for value of any Equity Interests of the Company or any Restricted
Subsidiary of the Company held by any member of the Company's (or any of its
Restricted Subsidiaries') management or board of directors pursuant to any
management equity subscription agreement, stock option agreement or other
similar agreement; PROVIDED that the aggregate price paid for all such
repurchased, redeemed, acquired or retired Equity Interests shall not exceed
$5.0 million (excluding for purposes of calculating such amounts during any
period, loans incurred to finance the purchase of such Equity Interests that are
repaid contemporaneously) in any twelve-month period and no Default or Event of
Default shall have occurred and be continuing immediately after such
41
transaction; (vi) repurchases of stock deemed to have occurred by virtue of the
exercise of stock options; and (vii) other Restricted Payments in an aggregate
amount not to exceed $5.0 million in any twelve-month period so long as no
Default or Event of Default shall have occurred and be continuing.
The amount of all Restricted Payments (other than cash) shall
be the fair market value on the date of the Restricted Payment of the asset(s)
or securities proposed to be transferred or issued by the Company or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
The fair market value of any non-cash Restricted Payment shall be determined in
good faith by the Board of Directors whose resolution with respect thereto shall
be delivered in writing to the Trustee. Not later than the date of making any
Restricted Payment, the Company shall deliver to the Trustee an Officers'
Certificate stating that such Restricted Payment is permitted and setting forth
the basis upon which any calculation required by this Section 4.07 were
computed.
The Board of Directors may designate any Restricted Subsidiary
to be an Unrestricted Subsidiary if such designation would not cause a Default.
For purposes of making such determination, the aggregate fair market value of
all outstanding Investments by the Company and its Restricted Subsidiaries in
the Subsidiary so designated will be deemed to be a Restricted Payment at the
time of such designation and will reduce the amount available for Restricted
Payments under the first paragraph of this Section 4.07. Such designation will
only be permitted if such Restricted Payment would be permitted at such time and
if such Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.
Any such designation by the Board of Directors shall be
evidenced to the Trustee by filing with the Trustee a certified 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 conditions. If, at any time, any Unrestricted Subsidiary would fail to
meet the definition of an Unrestricted Subsidiary, it shall thereafter cease to
be an Unrestricted Subsidiary for purposes of this Indenture and any
Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted
Subsidiary of the Company as of such date (and, if such Indebtedness is not
permitted to be incurred as of such date under Section 4.09 hereof, the Company
shall be in default). The Board of Directors of the Company may at any time
designate any Unrestricted Subsidiary to be a Restricted Subsidiary; PROVIDED
that such designation shall be deemed to be an incurrence of Indebtedness by a
Restricted Subsidiary of the Company of any outstanding Indebtedness of such
Unrestricted Subsidiary and such designation shall only be permitted if (i) such
Indebtedness is permitted under Section 4.09 hereof, calculated on a PRO FORMA
basis as if such designation had occurred at the beginning of the four-quarter
reference period and (ii) no Default or Event of Default would be in existence
immediately following such designation.
SECTION 4.08. DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING
SUBSIDIARIES.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or
suffer to exist or become effective any encumbrance or restriction on the
ability of any Restricted Subsidiary to (a)(i) pay dividends or make any other
distributions to the Company or any of its Restricted Subsidiaries (A) on its
Capital Stock or (B) with respect to any other interest or participation in, or
42
measured by, its profits or (ii) pay any indebtedness owed to the Company or any
of its Restricted Subsidiaries, (b) make loans or advances to the Company or any
of its Restricted Subsidiaries or (c) transfer any of its properties or assets
to the Company or any of its Restricted Subsidiaries, except for such
encumbrances or restrictions existing under or by reason of (i) Existing
Indebtedness as in effect on the date hereof, (ii) the Senior Credit Facilities
and any amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings thereof, and any other
agreement governing or relating to Senior Debt; PROVIDED that such amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings and other agreements are, taken as a whole, no more
restrictive with respect to such dividend and other payment restrictions than
those contained in the Senior Credit Facilities, (iii) this Indenture as in
effect on the Note Issue Date, the Notes and the Subsidiary Guarantees, (iv)
applicable law, (v) any instrument governing Indebtedness or Capital Stock of a
Person acquired by the Company or any of its Restricted Subsidiaries as in
effect at the time of such acquisition (except to the extent such Indebtedness
was incurred in connection with or in contemplation of such acquisition), which
encumbrance or restriction is not applicable to any Person, or the properties or
assets of any Person, other than the Person, or the property or assets of the
Person, so acquired; PROVIDED that, in the case of Indebtedness, such
Indebtedness was permitted by the terms of this Indenture to be incurred, (vi)
by reason of customary non-assignment provisions in leases and other agreements
entered into in the ordinary course of business and consistent with past
practices, (vii) purchase money obligations (including Capital Lease
Obligations) for property acquired in the ordinary course of business that
impose restrictions of the nature described in clause (c) above on the property
so acquired, (viii) Permitted Refinancing Indebtedness, PROVIDED that the
restrictions contained in the agreements governing such Permitted Refinancing
Indebtedness are no more restrictive, taken as a whole, than those contained in
the agreements governing the Indebtedness being refinanced, (ix) Liens securing
Indebtedness otherwise permitted to be incurred pursuant to the provisions of
Section 4.12 hereof that limits the right of the debtor to dispose of the assets
securing such Indebtedness, (x) provisions with respect to the disposition or
distribution of assets or property in joint venture agreements and other similar
agreements entered into in the ordinary course of business, (xi) restrictions on
cash or other deposits or net worth imposed by customers under contracts entered
into in the ordinary course of business, and (xii) any agreement for the sale or
other disposition of a Restricted Subsidiary that restricts distributions by
that Restricted Subsidiary pending its sale or other disposition.
SECTION 4.09. INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED
STOCK.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create, incur, issue,
assume, guarantee or otherwise become directly or indirectly liable,
contingently or otherwise, with respect to (collectively, "incur") any
Indebtedness (including Acquired Debt) or issue any shares of Disqualified Stock
and will not permit any of its Restricted Subsidiaries to issue any shares of
preferred stock; PROVIDED, HOWEVER, that, so long as no Default or Event of
Default has occurred and is continuing, the Company may incur Indebtedness
(including Acquired Debt) or issue shares of Disqualified Stock and the
Guarantors may issue shares of preferred stock if, in each case, the Company's
Debt to Cash Flow Ratio at the time of incurrence of such Indebtedness or the
issuance of such Disqualified Stock or preferred stock, as the case may be,
after giving pro forma effect to such incurrence or issuance as of such date and
to the use of the proceeds therefrom as if the same had occurred at the
beginning of the most recently ended four full fiscal quarter period of the
43
Company for which internal financial statements are available, would have been
no greater than 7.0 to 1.0.
So long as no Default shall have occurred and be continuing or
should be caused thereby, the provisions of the first paragraph of this Section
4.09 will not apply to the incurrence of any of the following (collectively,
"Permitted Debt"):
(i) the incurrence by the Company (and the guarantee
thereof by any Restricted Subsidiary) of Indebtedness and letters of credit
under one or more Credit Facilities in an aggregate principal amount at any time
outstanding not to exceed $175.0 million (with letters of credit being deemed to
have a principal amount equal to the maximum potential liability of the Company
and the Restricted Subsidiaries thereunder), less the aggregate amount of all
mandatory repayments of the principal of any term Indebtedness under a Credit
Facility that have been made since the Notes Issue Date (other than from the
proceeds of any other Credit Facility) and less the aggregate amount of all
commitment reductions of any revolving Indebtedness under a Credit Facility
pursuant to clause (i) of the third paragraph of Section 4.10 hereof;
(ii) the incurrence by the Company and the guarantee
thereof by the Guarantors of Indebtedness represented by the Notes and the
Subsidiary Guarantees;
(iii) the incurrence by the Company and its
Restricted Subsidiaries of the Existing Indebtedness;
(iv) the incurrence by the Company or its Restricted
Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage
financings or Purchase Money Indebtedness, in each case incurred for the purpose
of financing all or any part of the purchase price or cost of construction or
improvement of property, plant or equipment used in the business of the Company
or such Restricted Subsidiary, in an aggregate amount not to exceed $5.0 million
at any time outstanding;
(v) the incurrence by the Company or any of its
Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for,
or the net proceeds of which are used to refund, refinance or replace
Indebtedness (other than intercompany Indebtedness) that was permitted by this
Indenture to be incurred by the first paragraph of this Section 4.09, or by
clauses (ii), (iii), (iv), (v), (vii), (viii), (ix), (x), (xi), (xii) or (xiii)
of this paragraph;
(vi) the incurrence of Indebtedness between or among
the Company and any of its Restricted Subsidiaries; PROVIDED, HOWEVER, that (a)
if the Company is the obligor on such Indebtedness, such Indebtedness is
expressly subordinated to the prior payment in full of all Obligations with
respect to the Notes and (b) any subsequent issuance or transfer of Equity
Interests that results in any such Indebtedness being held by a Person other
than the Company or a Restricted Subsidiary, and any sale or other transfer of
any such Indebtedness to a Person that is not either the Company or a Restricted
Subsidiary, shall be deemed, in each case, to constitute an incurrence of such
Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
44
(vii) the incurrence by the Company or any of its
Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose
of fixing or hedging interest rate risk with respect to any floating rate
Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(viii) the guarantee by the Company or any of the
Guarantors (or, in the case of a Credit Facility, any Restricted Subsidiary) of
Indebtedness that was permitted to be incurred by another provision of this
Section 4.09;
(ix) the accrual of interest, the accretion or
amortization of original issue discount, the payment of interest on any
Indebtedness in the form of additional Indebtedness with the same terms, and the
payment of dividends on Disqualified Stock in the form of additional shares of
the same class of Disqualified Stock;
(x) the incurrence by the Company or any of its
Restricted Subsidiaries of Indebtedness consisting of performance, bid or
advance payment bonds, surety bonds, custom bonds, utility bonds and similar
obligations arising in the ordinary course of business;
(xi) the incurrence by the Company or any of its
Restricted Subsidiaries of Indebtedness arising from agreements providing for
indemnification, adjustment of purchase price or similar obligations, in each
case incurred or assumed in connection with the disposition of any business,
asset or Subsidiary of the Company; PROVIDED that the maximum assumable
Indebtedness shall at no time exceed the gross proceeds actually received by the
Company and its Restricted Subsidiaries in connection with the disposition of
any business, asset or Subsidiary of the Company;
(xii) the incurrence by the Company of Indebtedness
in respect of Notes issued as payment in kind interest on the Notes, to the
extent such interest payments are made pursuant to the terms of this Indenture
and the Notes; and
(xiii) the incurrence by the Company or any of its
Restricted Subsidiaries of additional Indebtedness in an aggregate principal
amount at any time outstanding, including all Permitted Refinancing Indebtedness
incurred pursuant to clause (v) above to refund, refinance or replace any
Indebtedness incurred pursuant to this clause (xiii), not to exceed $10.0
million.
For purposes of determining compliance with this Section 4.09,
in the event that an item of Indebtedness meets the criteria of more than one of
the categories of Permitted Debt described in clauses (i) through (xiii) above
or is entitled to be incurred pursuant to the first paragraph of this Section
4.09, the Company shall, in its sole discretion, classify and reclassify such
item of Indebtedness in whole or in part in any manner that complies with this
Section 4.09 and such item of Indebtedness will be treated as having been
incurred pursuant to such clauses or pursuant to the first paragraph hereof.
45
SECTION 4.10. ASSET SALES.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, consummate an Asset Sale unless (i) the Company or
such Restricted Subsidiary, as the case may be, receives consideration at the
time of such Asset Sale at least equal to the fair market value (as determined
in good faith by the Board of Directors of the Company or such Subsidiary) of
the assets or Equity Interests issued or sold or otherwise disposed of and (ii)
at least 75% of the consideration therefor received by the Company or such
Restricted Subsidiary is in the form of cash or Cash Equivalents; PROVIDED that
the amount of (a) any liabilities (as shown on the Company's or such Restricted
Subsidiary's most recent balance sheet) of the Company or such Restricted
Subsidiary (other than contingent liabilities and liabilities that are by their
terms subordinated to the Notes or any guarantee thereof) that are assumed by
the transferee of any such assets pursuant to a customary novation agreement
that releases the Company or such Restricted Subsidiary from further liability,
and (b) any securities, notes or other obligations received by the Company or
such Restricted Subsidiary from such transferee that are converted by the
Company or such Restricted Subsidiary into cash (to the extent of the cash
received) within ninety (90) days following the closing of such Asset Sale,
shall be considered cash for purposes of this clause (ii).
Notwithstanding the immediately preceding paragraph, the
Company and its Restricted Subsidiaries will be permitted to consummate an Asset
Sale without complying with such paragraph if (i) the Company or the applicable
Restricted Subsidiary, as the case may be, receives consideration at the time of
such Asset Sale at least equal to the fair market value of the assets or other
property sold, issued or otherwise disposed of (as evidenced by a resolution of
the Company's Board of Directors set forth in an Officers' Certificate delivered
to the Trustee) and (ii) at least 75% of the consideration for such Asset Sale
constitutes a controlling interest in a Permitted Business, long-term assets
used or useful in a Permitted Business and/or cash or Cash Equivalents; PROVIDED
that any cash or Cash Equivalents received by the Company or any of its
Restricted Subsidiaries in connection with any Asset Sale permitted to be
consummated under this paragraph shall constitute Net Proceeds subject to the
provisions of the next succeeding paragraph.
Within three hundred sixty five (365) days of the receipt of
any Net Proceeds from an Asset Sale, the Company may apply such Net Proceeds, at
its option, (i) to repay or redeem Senior Debt under a Credit Facility (and to
correspondingly reduce commitments with respect thereto in the case of revolving
borrowings), (ii) to the acquisition of a controlling interest in a Permitted
Business, or (iii) to the making of a capital expenditure or the acquisition of
other long-term assets used or useful in a Permitted Business. Notwithstanding
the foregoing, the Company shall have an additional sixty (60) days to complete
a redemption or repurchase of its existing Senior Subordinated Notes with the
Net Proceeds from an Asset Sale; PROVIDED that the Company commences an offer to
redeem or repurchase such Senior Subordinated Notes within three hundred sixty
five (365) days of the receipt of any Net Proceeds from an Asset Sale. Pending
the final application of any such Net Proceeds, the Company may temporarily
reduce Senior Debt or otherwise invest such Net Proceeds in any manner that is
not prohibited by this Indenture. Any Net Proceeds from Asset Sales that are not
applied or invested as provided in the first sentence of this paragraph shall be
deemed to constitute "Excess Proceeds." When the aggregate amount of Excess
Proceeds exceeds $10.0 million, the Company shall be required to make an offer
to all Holders of Notes and all holders of other PARI PASSU Indebtedness
containing provisions similar to those set forth in this Indenture with respect
to offers to purchase or redeem such other PARI PASSU Indebtedness with the
46
proceeds of sales of assets (an "Asset Sale Offer") to purchase the maximum
principal amount of Notes and such other PARI PASSU Indebtedness that may be
purchased out of the Excess Proceeds at an offer price in cash in an amount
equal to 100% of the principal amount thereof, plus accrued and unpaid interest,
if any, thereon to the date of purchase, in accordance with the procedures set
forth in this Indenture and in such other PARI PASSU Indebtedness. To the extent
that the aggregate amount of Notes and such other PARI PASSU Indebtedness
tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the
Company may use any remaining Excess Proceeds for any purpose not otherwise
prohibited by this Indenture. If the aggregate principal amount of Notes and
such other PARI PASSU Indebtedness surrendered by Holders thereof exceeds the
amount of Excess Proceeds, the Trustee shall select the Notes and such other
PARI PASSU Indebtedness to be purchased on a PRO RATA basis. Upon completion of
an Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero.
SECTION 4.11. TRANSACTIONS WITH AFFILIATES.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or
otherwise dispose of any of its properties or assets to, or purchase any
property or assets from, or enter into or make or amend any transaction,
contract, agreement, understanding, loan, advance or guarantee with, or for the
benefit of, any Affiliate (each of the foregoing, an "Affiliate Transaction"),
unless (i) such Affiliate Transaction is on terms that are no less favorable to
the Company or such Restricted Subsidiary than those that would have been
obtained in a comparable transaction by the Company or such Restricted
Subsidiary with an unrelated Person and (ii) the Company delivers to the Trustee
(a) with respect to any Affiliate Transaction or series of related Affiliate
Transactions involving aggregate consideration in excess of $2.5 million, a
resolution of the Board of Directors set forth in an Officers' Certificate
certifying that such Affiliate Transaction complies with clause (i) above and
that such Affiliate Transaction has been approved by a majority of the members
of the Board of Directors that are disinterested as to such Affiliate
Transaction and (b) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in excess of
$10.0 million, an opinion as to the fairness to the Company of such Affiliate
Transaction from a financial point of view issued by an accounting, appraisal or
investment banking firm of national standing; PROVIDED that (1) any transaction
approved by the Board of Directors of the Company, with an officer or director
of the Company or of any of its Subsidiaries in his or her capacity as an
officer or director entered into in the ordinary course of business; (2)
transactions between or among the Company and/or its Restricted Subsidiaries;
(3) payment of reasonable directors fees to the Board of Directors of the
Company and of its Restricted Subsidiaries; (4) fees and compensation paid to,
and indemnity provided on behalf of, officers, directors or employees of the
Company or any of its Restricted Subsidiaries, as determined in good faith by
the Board of Directors of the Company or of any such Restricted Subsidiary, to
the extent the same are reasonable and customary; (5) any Restricted Payment
that is permitted by Section 4.07; and (6) agreements in effect on the Notes
Issue Date and any modification thereto or any transaction contemplated thereby
(including pursuant to any modification thereto) in any replacement agreement
47
therefor so long as such modification or replacement is not more disadvantageous
to the holders of the Notes in any material respect than the original agreement
as in effect on the Notes Issue Date, in each case, shall not be deemed to be
Affiliate Transactions.
SECTION 4.12. LIENS.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly create, incur, assume or
suffer to exist any Lien securing Indebtedness or trade payables on any asset
now owned or hereafter acquired, or any income or profits therefrom or assign or
convey any right to receive income therefrom, except Permitted Liens.
SECTION 4.13. ASSET SWAPS.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, in one or a series of related transactions, directly
or indirectly, engage in any Asset Swaps, unless: (i) at the time of entering
into the agreement to swap assets and immediately after giving effect to the
proposed Asset Swap, no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; (ii) the Company would,
after giving PRO FORMA effect to the proposed Asset Swap, have been permitted to
incur at least $1.00 of additional Indebtedness pursuant to the Debt to Cash
Flow Ratio in Section 4.09; (iii) the respective fair market values of the
assets being purchased and sold by the Company or any of its Restricted
Subsidiaries (as determined in good faith by the management of the Company or,
if such Asset Swap includes consideration in excess of $1.0 million by the Board
of Directors of the Company, as evidenced by a resolution of the Board of
Directors) are substantially the same at the time of entering into the agreement
to swap assets; and (iv) at the time of the consummation of the proposed Asset
Swap, the percentage of any decline in the fair market value (determined as
aforesaid) of the asset or assets being acquired by the Company and its
Restricted Subsidiaries shall not be significantly greater than the percentage
of any decline in the fair market value (determined as aforesaid) of the assets
being disposed of by the Company or its Restricted Subsidiaries, calculated from
the time the agreement to swap assets was entered into.
SECTION 4.14. CORPORATE EXISTENCE.
Subject to Article 5 hereof, the Company shall do or cause to
be done all things necessary to preserve and keep in full force and effect (i)
its corporate existence, and the corporate, partnership or other existence of
each of its Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Company or any
such Subsidiary and (ii) the rights (charter and statutory), licenses and
franchises of the Company and its Subsidiaries; PROVIDED, HOWEVER, that the
Company shall not be required to preserve any such right, license or franchise,
or the corporate, partnership or other existence of any of its Subsidiaries, if
the Board of Directors shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Company and its
Subsidiaries, taken as a whole, and that the loss thereof is not adverse in any
material respect to the Holders of the Notes.
SECTION 4.15. OFFER TO REPURCHASE UPON CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, the Company
shall be obligated to make an offer (a "Change of Control Offer") to each Holder
of Notes to repurchase all or any part (equal to $1,000 or an integral multiple
48
thereof) of such Holder's Notes at an offer price in cash equal to 101% of the
principal amount thereof, plus accrued and unpaid interest, if any, thereon to
the date of purchase (the "Change of Control Payment"). Within ten days
following a Change of Control, the Company will mail a notice to the Trustee and
each Holder describing the transaction or transactions that constitute the
Change of Control and offering to repurchase Notes on the date specified in such
notice, which date shall be no earlier than thirty (30) days and no later than
sixty (60) days from the date such notice is mailed (the "Change of Control
Payment Date"), pursuant to the procedures required by this Indenture and
described in such notice. The Company will comply with the requirements of
Section 14(e) under the Exchange Act and any other securities laws and
regulations thereunder to the extent such laws and regulations are applicable in
connection with the repurchase of the Notes as a result of a Change of Control.
(b) On the Change of Control Payment Date, the Company shall,
to the extent lawful, (i) accept for payment all Notes or portions thereof
properly tendered pursuant to the Change of Control Offer, (ii) deposit with the
Paying Agent an amount equal to the Change of Control Payment in respect of all
Notes or portions thereof so tendered and (iii) deliver or cause to be delivered
to the Trustee the Notes so accepted together with an Officers' Certificate
stating the aggregate principal amount of Notes or portions thereof being
purchased by the Company. The Paying Agent will promptly mail to each Holder of
Notes so tendered the Change of Control Payment for such Notes, and the Trustee
will promptly authenticate and mail (or cause to be transferred by book entry)
to each Holder a new Note equal in principal amount to any unpurchased portion
of the Notes surrendered, if any; PROVIDED that each such new Note will be in a
principal amount of $1,000 or an integral multiple thereof.
The Change of Control provisions described above will be
applicable whether or not any other provisions of this Indenture are applicable.
(c) Notwithstanding anything to the contrary in this Section
4.15, the Company shall not be required to make a Change of Control Offer upon a
Change of Control if a third party makes the Change of Control Offer in the
manner, at the times and otherwise in compliance with the requirements set forth
in this Section 4.15 hereof and purchases all Notes validly tendered and not
withdrawn under such Change of Control Offer.
SECTION 4.16. LIMITATION ON OTHER SUBORDINATED DEBT.
Notwithstanding the provisions of Section 4.09 hereof, (i) the
Company shall not directly or indirectly incur any Indebtedness that is
subordinate or junior in right of payment to any Senior Debt and senior in any
respect in right of payment to the Notes and (ii) no Guarantor shall incur any
Indebtedness that is subordinated or junior in right of payment to any
Guarantees of Senior Debt and senior in any respect in right of payment to the
Subsidiary Guarantees.
SECTION 4.17. LIMITATION ON SALE AND LEASEBACK TRANSACTIONS.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, enter into any sale and leaseback transaction;
PROVIDED that the Company and the Guarantors may enter into a sale and leaseback
transaction if (i) the Company or such Guarantor could have (a) incurred
Indebtedness in an amount equal to the Attributable Debt relating to such sale
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and leaseback transaction pursuant to the Debt to Cash Flow Ratio test set forth
in the first paragraph of Section 4.09 hereof and (b) incurred a Lien to secure
such Attributable Debt pursuant to Section 4.12 hereof, (ii) the gross cash
proceeds of such sale and leaseback transaction are at least equal to the fair
market value (as determined in good faith by the Board of Directors in good
faith) of the property that is the subject of such sale and leaseback
transaction and (iii) the transfer of assets in such sale and leaseback
transaction is permitted by, and the proceeds of such transaction are applied in
compliance with Section 4.10 hereof.
SECTION 4.18. PAYMENTS FOR CONSENT.
Neither the Company nor any of its Subsidiaries shall,
directly or indirectly, pay or cause to be paid any consideration, whether by
way of interest, fee or otherwise, to any Holder of any Notes for or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture or the Notes unless such consideration is offered to be paid
or is paid to all Holders of the Notes that consent, waive or agree to amend in
the time frame set forth in the solicitation documents relating to such consent,
waiver or agreement.
SECTION 4.19. ADDITIONAL SUBSIDIARY GUARANTEES.
If the Company or any of its Restricted Subsidiaries shall
acquire or create another Restricted Subsidiary after the date of this Indenture
(other than a Non-Guarantor Subsidiary), or any Unrestricted Subsidiary (other
than a Non-Guarantor Subsidiary) shall become a Restricted Subsidiary of the
Company, then such Subsidiary shall become a Guarantor by executing a
supplemental indenture in a form reasonably satisfactory to the Trustee,
pursuant to which such Restricted Subsidiary shall unconditionally guarantee all
of the Company's Obligations under the Notes and this Indenture and deliver an
Opinion of Counsel to the Trustee to the effect that such supplemental indenture
has been duly authorized, executed and delivered by such Subsidiary and
constitutes a valid and binding obligation of such Subsidiary, enforceable
against such Subsidiary in accordance with its terms (subject to customary
exceptions).
ARTICLE V
SUCCESSORS
SECTION 5.01. MERGER, CONSOLIDATION, OR SALE OF ASSETS.
The Company shall not consolidate or merge with or into
(whether or not the Company is the surviving corporation) another Person, or
sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of its properties or assets in one or more related
transactions, to another corporation, Person or entity unless (i) the Company is
the surviving corporation or the entity or the Person formed by or surviving any
such consolidation or merger (if other than the Company) or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made is a corporation organized or existing under the laws of the United States,
any state thereof or the District of Columbia; (ii) the entity or Person formed
by or surviving any such consolidation or merger (if other than the Company) or
the entity or Person to which such sale, assignment, transfer, lease, conveyance
or other disposition shall have been made assumes by a supplemental indenture in
form reasonably satisfactory to the Trustee all the obligations of the Company
under the Notes and the Indenture; (iii) immediately after such transaction no
Default or Event of Default exists; and (iv) except in the case of a merger of
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the Company with or into a Wholly Owned Restricted Subsidiary of the Company,
the Company or the entity or Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made would, both immediately prior to and immediately after giving pro forma
effect thereto as if such transaction had occurred at the beginning of the
applicable four-quarter period, be permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Debt to Cash Flow Ratio test set forth
in Section 4.09 hereof.
SECTION 5.02. SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation or merger, or any sale, assignment,
transfer, lease, conveyance or other disposition of all or substantially all of
the assets of the Company in accordance with Section 5.01 hereof, the successor
corporation formed by such consolidation or into or with which the Company is
merged or to which such sale, assignment, transfer, lease, conveyance or other
disposition is made shall succeed to, and be substituted for (so that from and
after the date of such consolidation, merger, sale, lease, conveyance or other
disposition, the provisions of this Indenture referring to the "Company" shall
refer instead to the successor corporation and not to the Company), and may
exercise every right and power of the Company under this Indenture with the same
effect as if such successor entity or Person had been named as the Company
herein; PROVIDED, HOWEVER, that the predecessor Company shall not be relieved
from the obligation to pay the principal of and interest on the Notes except in
the case of a sale of all of the Company's assets that meets the requirements of
Section 5.01 hereof.
ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT.
An "Event of Default" occurs if:
(a) the Company defaults for thirty (30) days in the payment
when due of interest on, the Notes, whether or not such payment is prohibited by
the provisions of Article 10 hereof;
(b) the Company defaults in payment when due of the principal
of or premium, if any, on the Notes, whether or not such payment is prohibited
by the provisions of Article 10 hereof;
(c) the Company or any Restricted Subsidiary fails to comply
with any of the provisions of Section 4.15 or 5.01 hereof;
(d) the Company or any Restricted Subsidiary fails for thirty
(30) days after written notice by the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Notes to comply with the provisions of
Section 3.09, 4.07, 4.09 or 4.10 hereof (such notice must specify the Default,
demand that it be remedied and state that the notice is a "Notice of Default");
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(e) the Company or any Restricted Subsidiary fails for sixty
(60) days after written notice by the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Notes to comply with any of its other
agreements in this Indenture or the Notes (such notice must specify the Default,
demand that it be remedied and state that the notice is a "Notice of Default");
(f) the Company or any Significant Subsidiary defaults under
any mortgage, indenture or instrument under which there may be issued or by
which there may be secured or evidenced any Indebtedness for money borrowed by
the Company or any of its Significant Subsidiaries (or the payment of which is
guaranteed by the Company or any of its Significant Subsidiaries), whether such
Indebtedness or guarantee now exists or is created after the date hereof, which
default (a) is caused by a failure to pay (a "Payment Default") principal of or
premium, if any, or interest on such Indebtedness when due (after giving effect
to any applicable grace period provided in such Indebtedness on the date of such
default) or (b) results in the acceleration of such Indebtedness prior to its
express maturity and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates $5.0 million or more;
(g) the Company or any of its Significant Subsidiaries fails
to pay final judgments aggregating in excess of $5.0 million (net of amounts
covered by insurance), which judgments are not paid, discharged or stayed for a
period of sixty (60) days;
(h) except as permitted by this Indenture, any Subsidiary
Guarantee shall be held in any judicial proceeding to be unenforceable or
invalid or shall cease for any reason to be in full force and effect or any
Guarantor, or any Person acting on behalf of any Guarantor, shall deny or
disaffirm its obligations under its Subsidiary Guarantee;
(i) the Company or any of the Company's Restricted
Subsidiaries that constitutes a Significant Subsidiary or any group of
Restricted Subsidiaries of the Company that, taken together, would constitute a
Significant Subsidiary pursuant to or within the meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief
against it in an involuntary case,
(iii) consents to the appointment of a custodian of
it or for all or substantially all of its property,
(iv) makes a general assignment for the benefit of
its creditors, or
(v) generally is not paying its debts as they become
due;
(j) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that: (i) is for relief against the Company or
any of its Restricted Subsidiaries that constitutes a Significant Subsidiary or
any group of Restricted Subsidiaries that, taken as a whole, would constitute a
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Significant Subsidiary in an involuntary case; (ii) appoints a custodian of the
Company or any of its Restricted Subsidiaries that constitutes a Significant
Subsidiary or any group of Restricted Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary or for all or substantially all of the
property of the Company or any of its Restricted Subsidiaries that constitutes a
Significant Subsidiary or any group of Restricted Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary; or (iii) orders the
liquidation of the Company or any of its Restricted Subsidiaries that
constitutes a Significant Subsidiary or any group of Restricted Subsidiaries
that, taken as a whole, would constitute a Significant Subsidiary; and the order
or decree remains unstayed and in effect for sixty (60) consecutive days.
SECTION 6.02. ACCELERATION.
If any Event of Default (other than an Event of Default
specified in clause (i) or (j) of Section 6.01 hereof with respect to the
Company, any Significant Subsidiary or any group of Significant Subsidiaries
that, taken as a whole, would constitute a Significant Subsidiary) occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the then outstanding Notes may declare all the Notes to be due and payable
immediately. Notwithstanding the foregoing, if an Event of Default specified in
clause (i) or (j) of Section 6.01 hereof occurs with respect to the Company, any
Restricted Subsidiary of the Company that constitutes a Significant Subsidiary
or any group of Restricted Subsidiaries of the Company that, taken together,
would constitute a Significant Subsidiary, all outstanding Notes will
automatically become due and payable without further action or notice. Holders
of the Notes may not enforce this Indenture or the Notes except as provided in
this Indenture. Subject to certain limitations, Holders of a majority in
principal amount of the then outstanding Notes may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders of the
Notes notice of any continuing Default or Event of Default (except a Default or
Event of Default relating to the payment of principal or interest) if it
determines that withholding notice is in their interest.
If an Event of Default occurs on or after October 15, 2008 by
reason of any willful action (or inaction) taken (or not taken) by or on behalf
of the Company with the intention of avoiding payment of the premium that the
Company would have had to pay if the Company then had elected to redeem the
Notes pursuant to Section 3.07 hereof, then, upon acceleration of the Notes, an
equivalent premium shall also become and be immediately due and payable, to the
extent permitted by law, anything in this Indenture or in the Notes to the
contrary notwithstanding.
The Holders of a majority in aggregate principal amount of the
Notes then outstanding by notice to the Trustee may on behalf of the Holders of
all of the Notes waive any existing Default or Event of Default and its
consequences under this Indenture except a continuing Default or Event of
Default in the payment of interest on, or the principal of, the Notes.
The Company is required to deliver to the Trustee annually a
statement regarding compliance with this Indenture, and the Company is required
upon becoming aware of any Default or Event of Default, to deliver to the
Trustee a statement specifying such Default or Event of Default.
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SECTION 6.03. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy to collect the payment of principal, premium, if
any, and interest on the Notes or to enforce the performance of any provision of
the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not
possess any of the Notes or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Holder of a Note in exercising any right
or remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. All remedies
are cumulative to the extent permitted by law.
SECTION 6.04. WAIVER OF PAST DEFAULTS.
Holders of not less than a majority in aggregate principal
amount of the then outstanding Notes by notice to the Trustee may on behalf of
the Holders of all of the Notes waive an existing Default or Event of Default
and its consequences hereunder, except a continuing Default or Event of Default
in the payment of the principal of, premium, if any, or interest on, the Notes
(including in connection with an offer to purchase) (PROVIDED, HOWEVER, that the
Holders of a majority in aggregate principal amount of the then outstanding
Notes may rescind an acceleration and its consequences, including any related
payment default that resulted from such acceleration). Upon any such waiver,
such Default shall cease to exist, and any Event of Default arising therefrom
shall be deemed to have been cured for every purpose of this Indenture; but no
such waiver shall extend to any subsequent or other Default or impair any right
consequent thereon.
SECTION 6.05. CONTROL BY MAJORITY.
Holders of a majority in principal amount of the then
outstanding Notes may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising any
trust or power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture that the Trustee determines
may be unduly prejudicial to the rights of other Holders of Notes or that may
involve the Trustee in personal liability.
SECTION 6.06. LIMITATION ON SUITS.
A Holder of a Note may pursue a remedy with respect to this
Indenture or the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice
of a continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the
then outstanding Notes make a written request to the Trustee to pursue the
remedy;
(c) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee against
any loss, liability or expense;
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(d) the Trustee does not comply with the request within sixty
(60) days after receipt of the request and the offer and, if requested, the
provision of indemnity; and
(e) during such 60-day period the Holders of a majority in
principal amount of the then outstanding Notes do not give the Trustee a
direction inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the
rights of another Holder of a Note or to obtain a preference or priority over
another Holder of a Note.
SECTION 6.07. RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the
right of any Holder of a Note to receive payment of principal, premium, if any,
and interest on the Note, on or after the respective due dates expressed in the
Note (including in connection with an offer to purchase), or to bring suit for
the enforcement of any such payment on or after such respective dates, shall not
be impaired or affected without the consent of such Holder.
SECTION 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(a) or (b)
occurs and is continuing, the Trustee is authorized to recover judgment in its
own name and as trustee of an express trust against the Company for the whole
amount of principal of, premium, if any, and interest remaining unpaid on the
Notes and interest on overdue principal and, to the extent lawful, interest and
such further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee is authorized to file such proofs of claim and
other papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel) and
the Holders of the Notes allowed in any judicial proceedings relative to the
Company (or any other obligor upon the Notes), its creditors or its property and
shall be entitled and empowered to collect, receive and distribute any money or
other property payable or deliverable on any such claims and any custodian in
any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee, and in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due to it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.07 hereof. To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof out
of the estate in any such proceeding shall be denied for any reason, payment of
the same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties that after
giving effect to Article 10 the Holders may be entitled to receive in such
proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize
55
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.
SECTION 6.10. PRIORITIES.
If the Trustee collects any money pursuant to this Article, it
shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts
due under Section 7.07 hereof, including payment of all compensation, expense
and liabilities incurred, and all advances made, by the Trustee and the costs
and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the
Notes for principal, premium, if any, and interest, ratably, without preference
or priority of any kind, according to the amounts due and payable on the Notes
for principal, premium, if any and interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any
payment to Holders of Notes pursuant to this Section 6.10.
SECTION 6.11. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or
omitted by it as a Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees and expenses, against any party litigant in the suit,
having due regard to the merits and good faith of the claims or defenses made by
the party litigant. This Section does not apply to a suit by the Trustee, a suit
by a Holder of a Note pursuant to Section 6.07 hereof, or a suit by Holders of
more than 10% in principal amount of the then outstanding Notes.
SECTION 6.12. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES
AND STOCKHOLDERS.
No director, officer, employee or stockholder of the Company
or any Guarantor, as such, shall have any liability for any obligations of the
Company or any Guarantor under the Notes, the Subsidiary Guarantees, the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes. Such waiver may not be effective to
waive liabilities under the federal securities laws and it is the view of the
SEC that such a waiver is against public policy.
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ARTICLE VII
TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in its exercise, as a
prudent 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 duties of the Trustee shall be determined
solely by the express provisions of this Indenture and the TIA and the Trustee
need perform only those duties that are specifically set forth in this Indenture
and no others, and no implied covenants or obligations shall be read into this
Indenture or the TIA against the Trustee; and
(ii) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the requirements of this Indenture.
However, in the case of any such certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the Trustee
shall be under a duty to examine the same to determine whether or not they
conform 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 as a result
of its own gross negligence, or willful misconduct, except that:
(i) this paragraph does not limit the effect of
paragraph (b)(i) of this Section;
(ii) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it is proved that
the Trustee was grossly negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to
any action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b), and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or incur any liability. The Trustee shall be
under no obligation to exercise any of its rights and powers under this
Indenture at the request of any Holders, unless such Holder shall have offered
57
to the Trustee security and indemnity satisfactory to it against any loss,
liability or expense that might be incurred by it in compliance with such
request or direction.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
SECTION 7.02. RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely upon any document
believed by it to be genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter stated in the
document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel or both. The Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on such Officers' Certificate or Opinion of Counsel. The Trustee may
consult with counsel of its reasonable discretion and the advice of such counsel
or any Opinion of Counsel shall be full and complete authorization and
protection from liability in respect of any action taken, suffered or omitted by
it hereunder in good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and
shall not be responsible for the misconduct or negligence of any agent appointed
with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith that it believes to be authorized or within the
rights or powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture,
any demand, request, direction or notice from the Company or any Guarantor shall
be sufficient if signed by an Officer of the Company or Guarantor issuing such
demand, request, direction or notice.
(f) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders unless such Holders shall have offered to the
Trustee security or indemnity reasonably satisfactory to the Trustee against the
costs, expenses and liabilities that might be incurred by it in compliance with
such request or direction.
(g) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document, but
the Trustee, in its discretion, may make such reasonable further inquiry or
investigation into such facts or matters as it may determine, and, if the
Trustee makes such inquiry or investigation, it shall be entitled on reasonable
prior notice to examine during customary business hours the books, records and
premises of the Company, personally or by agent or attorney at the sole cost of
the Company and shall incur no liability or additional liability of any kind by
reason of such inquiry or investigation.
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(h) The Trustee shall not be deemed to have notice of any
Default or Event of Default unless a Responsible 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, and
such notice references the Notes and this Indenture.
(i) 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 agent, custodian and other Person
employed to act hereunder.
(j) The Trustee may consult with counsel of its selection and
the advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and reliance thereon.
(k) The Trustee may request that the Company 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 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 superceded.
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within ninety (90) days, apply to the
SEC for permission to continue as trustee or resign. Any Agent may do the same
with like rights and duties. The Trustee is also subject to Sections 7.10 and
7.11 hereof.
SECTION 7.04. TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the Notes, it
shall not be accountable for the Company's use of the proceeds from the Notes or
any money paid to the Company or upon the Company's direction under any
provision of this Indenture, it shall not be responsible for the use or
application of any money received by any Paying Agent other than the Trustee,
and it shall not be responsible for any statement or recital herein or any
statement in the Notes or any other document in connection with the sale of the
Notes or pursuant to this Indenture other than its certificate of
authentication.
SECTION 7.05. NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and
if it is known to the Trustee, the Trustee shall mail to Holders of Notes a
notice of the Default or Event of Default within ninety (90) days after it
occurs. Except in the case of a Default or Event of Default in payment of
principal of, premium, if any, or interest on any Note, the Trustee may withhold
the notice if and so long as a committee of its Responsible Officers in good
faith determines that withholding the notice is in the interests of the Holders
of the Notes.
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SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES.
Within sixty (60) days after each May 15 beginning with the
May 15 following the date of this Indenture, and for so long as Notes remain
outstanding, the Trustee shall mail to the Holders of the Notes a brief report
dated as of such reporting date that complies with TIA ss. 313(a) (but if no
event described in TIA ss. 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
shall comply with TIA ss. 313(b)(2). The Trustee shall also transmit by mail all
reports as required by TIA ss. 313(c).
A copy of each report at the time of its mailing to the
Holders of Notes shall be mailed to the Company and filed with the SEC and each
stock exchange on which the Notes are listed in accordance with TIA ss.313(d).
The Company shall promptly notify the Trustee when the Notes are listed on any
stock exchange or of any delisting thereof.
SECTION 7.07. COMPENSATION AND INDEMNITY.
The Company and the Guarantors shall pay to the Trustee from
time to time such compensation for its acceptance of this Indenture and the
rendering by it of the services required hereunder as shall be agreed in writing
with the Company. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company and the Guarantors
shall reimburse the Trustee promptly upon request for all reasonable
disbursements, advances and expenses incurred or made by it in addition to the
compensation for its services. Such expenses shall include the reasonable
compensation, disbursements and expenses of the Trustee's agents and counsel.
The Company and the Guarantors shall indemnify each of the
Trustee and any predecessor of the Trustee against any and all losses,
liabilities, damages, claims or expenses, including taxes (other than taxes
based on the income of the Trustee) incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, including the costs and expenses of enforcing this Indenture against
the Company and the Guarantors (including this Section 7.07) and defending
itself against any claim (whether asserted by the Company and the Guarantors or
any Holder or any other person) or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except to the extent any
such loss, liability or expense may be attributable to its gross negligence or
willful misconduct. The Trustee shall notify the Company and the Guarantors
promptly of any claim for which it may seek indemnity.
The obligations of the Company and the Guarantors under this
Section 7.07 shall survive the satisfaction and discharge of this Indenture and
the resignation or removal of the Trustee.
To secure the Company's and the Guarantors' payment
obligations in this Section, the Trustee shall have a Lien prior to the Notes on
all money or property held or collected by the Trustee, except that held in
trust to pay principal and interest on particular Notes. Such Lien shall survive
the satisfaction and discharge of this Indenture. Compensation, reimbursement
and indemnification of the Trustee under this Section 7.07 are not subordinated
to Senior Debt of the Company.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(i) or (j) hereof occurs, the expenses
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and the compensation for the services (including the fees and expenses of its
agents and counsel) are intended to constitute expenses of administration under
any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss.
313(b)(2) to the extent applicable.
SECTION 7.08. REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
The Trustee may resign in writing at any time and be
discharged from the trust hereby created by so notifying the Company. The
Holders of Notes of a majority in principal amount of the then outstanding Notes
may remove the Trustee by so notifying the Trustee and the Company in writing.
The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any Bankruptcy
Law;
(c) a custodian or public officer takes charge of the Trustee
or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee. Within one (1) year after the successor Trustee takes office,
the Holders of a majority in principal amount of the then outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
If a successor Trustee does not take office within sixty (60)
days after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company, or the Holders of Notes of at least 10% in principal amount of the then
outstanding Notes may petition, at the expense of the Company any court of
competent jurisdiction for the appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Note
who has been a Holder of a Note for at least six (6) months, fails to comply
with Section 7.10, such Holder of a Note may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders of the Notes. The retiring Trustee shall promptly transfer
all property held by it as Trustee to the successor Trustee, provided all sums
owing to the Trustee hereunder have been paid and subject to the Lien provided
for in Section 7.07 hereof. Notwithstanding replacement of the Trustee pursuant
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to this Section 7.08, the Company's obligations under Section 7.07 hereof shall
continue for the benefit of the retiring Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trustee power, that is subject to supervision or examination by
federal or state authorities and that has a combined capital and surplus of at
least $50.0 million as set forth in its most recent published annual report of
condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss.310(a)(1), (2) and (5). The Trustee is subject to TIA
ss.310(b).
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee is subject to TIA ss.311(a), excluding any
creditor relationship listed in TIA ss.311(b). A Trustee who has resigned or
been removed shall be subject to TIA ss.311(a) to the extent indicated therein.
ARTICLE VIII
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.01. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at the option of its Board of Directors
evidenced by a resolution set forth in an Officers' Certificate, at any time,
elect to have either Section 8.02 or 8.03 hereof be applied to all outstanding
Notes upon compliance with the conditions set forth below in this Article 8.
SECTION 8.02. LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 8.01 hereof of the
option applicable to this Section 8.02, the Company shall, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, be deemed to
have been discharged from its obligations with respect to all outstanding Notes
and to have each Guarantor's obligation discharged with respect to its
Subsidiary Guarantee on the date the conditions set forth below are satisfied
(hereinafter, "Legal Defeasance"). For this purpose, Legal Defeasance means that
the Company shall be deemed to have paid and discharged the entire Indebtedness
represented by the outstanding Notes, which shall thereafter be deemed to be
"outstanding" only for the purposes of Section 8.05 hereof and the other
Sections of this Indenture referred to in (a) and (b) below, and to have
satisfied all its other obligations under such Notes and this Indenture (and the
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Trustee, on demand of and at the expense of the Company, shall execute proper
instruments acknowledging the same), except for the following provisions which
shall survive until otherwise terminated or discharged hereunder: (a) the rights
of Holders of outstanding Notes to receive solely from the trust fund described
in Section 8.04 hereof, and as more fully set forth in such Section, payments in
respect of the principal of and premium and interest, on such Notes when such
payments are due, (b) the Company's obligations with respect to such Notes under
Article 2 and Section 4.02 hereof, (c) the rights, powers, trusts, duties and
immunities of the Trustee hereunder and the Company's obligations in connection
therewith and (d) this Article 8. Subject to compliance with this Article 8, the
Company may exercise its option under this Section 8.02 notwithstanding the
prior exercise of its option under Section 8.03 hereof.
SECTION 8.03. COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.01 hereof of the
option applicable to this Section 8.03, the Company and each Guarantor shall,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
be released from their obligations under the covenants contained in Sections
4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.15, 4.16, 4.17, 4.18, 4.19, 5.01 and
11.01 hereof with respect to the outstanding Notes on and after the date the
conditions set forth in Section 8.04 are satisfied (hereinafter, "Covenant
Defeasance"), and the Notes shall thereafter be deemed not "outstanding" for the
purposes of any direction, waiver, consent or declaration or act of Holders (and
the consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes, the Company and each Guarantor may omit to comply with and
shall have no liability in respect of any term, condition or limitation set
forth in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any reference in
any such covenant to any other provision herein or in any other document and
such omission to comply shall not constitute a Default or an Event of Default
under Section 6.01 hereof, but, except as specified above, the remainder of this
Indenture and such Notes shall be unaffected thereby. In addition, upon the
Company's exercise under Section 8.01 hereof of the option applicable to this
Section 8.03 hereof, subject to the satisfaction of the conditions set forth in
Section 8.04 hereof, Sections 6.01(d) through 6.01(f) hereof shall not
constitute Events of Default.
SECTION 8.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of
either Section 8.02 or 8.03 hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant
Defeasance:
(a) the Company must irrevocably deposit with the Trustee, in
trust, for the benefit of the Holders, cash in United States dollars,
non-callable Government Securities, or a combination thereof, in such amounts as
will be sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal of, premium and, if any,
and interest on the outstanding Notes on the stated date for payment thereof or
on the applicable redemption date, as the case may be, and the Company must
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specify whether the Notes are being defeased to maturity or to a particular
redemption date;
(b) in the case of an election under Section 8.02 hereof, the
Company shall have delivered to the Trustee an Opinion of Counsel in the United
States reasonably acceptable to the Trustee confirming that (A) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (B) since the date of 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 of the
outstanding Notes will not recognize income, gain or loss for federal income tax
purposes as a result of such Legal Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such Legal Defeasance had not occurred;
(c) in the case of an election under Section 8.03 hereof, the
Company shall have delivered to the Trustee an Opinion of Counsel in the United
States reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Notes will not recognize income, gain or loss for federal income tax
purposes as a result of such Covenant Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such Covenant Defeasance had not occurred;
(d) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event of Default
resulting from the incurrence of Indebtedness all or a portion of the proceeds
of which will be used to defease the Notes pursuant to this Article 8
concurrently with such incurrence) or insofar as Sections 6.01(i) or 6.01(j)
hereof is concerned, at any time in the period ending on the ninety first (91st)
day after the date of deposit (or greater period of time in which any such
deposit of trust funds may remain subject to bankruptcy or insolvency laws
insofar as those apply to the deposit by the Company);
(e) such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute a default under, any material
agreement or instrument (other than this Indenture) to which the Company or any
of its Subsidiaries is a party or by which the Company or any of its
Subsidiaries is bound;
(f) the Company shall have delivered to the Trustee an Opinion
of Counsel (which may be subject to customary exceptions) to the effect that (A)
on the ninety first (91st) day following the deposit (or greater period of time
in which any such deposit of trust funds may remain subject to bankruptcy or
insolvency laws insofar as those apply to the deposit by the Company), the trust
funds will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights generally
and (B) the trust funds will not be subject to the rights of holders of
Indebtedness other than the Notes;
(g) the Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made by the Company with
the intent of preferring the Holders over any other creditors of the Company or
with the intent of defeating, hindering, delaying or defrauding any other
creditors of the Company or others; and
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(h) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for or relating to the Legal Defeasance or the
Covenant Defeasance have been complied with.
SECTION 8.05. DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD
IN TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06 hereof, all money and non-callable
Government Securities (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this Section
8.05, the "Trustee") pursuant to Section 8.04 hereof in respect of the
outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including the Company acting as
Paying Agent) as the Trustee may determine, to the Holders of such Notes of all
sums due and to become due thereon in respect of principal, premium, if any, and
interest, but such money need not be segregated from other funds except to the
extent required by law.
The Company and the Guarantors shall pay and indemnify the
Trustee against any tax, fee or other charge imposed on or assessed against the
cash or non-callable Government Securities deposited pursuant to Section 8.04
hereof or the principal and interest received in respect thereof other than any
such tax, fee or other charge which by law is for the account of the Holders of
the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon the
request of the Company any money or non-callable Government Securities held by
it as provided in Section 8.04 hereof which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee (which may be the opinion
delivered under Section 8.04(a) hereof), are in excess of the amount thereof
that would then be required to be deposited to effect an equivalent Legal
Defeasance or Covenant Defeasance.
Any deposit made pursuant to this Article VIII shall be
subject to the provisions of Article X only if payment in respect of the Notes
is prohibited under Article X on the date such deposit is made.
SECTION 8.06. REPAYMENT TO COMPANY.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of, premium,
if any, or interest on any Note and remaining unclaimed for two years after such
principal, and premium, if any, or interest has become due and payable shall be
paid to the Company on its request or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall thereafter, as a
secured creditor, look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, shall thereupon cease;
PROVIDED, HOWEVER, that the Trustee or such Paying Agent, before being required
to make any such repayment, shall at the expense of the Company cause to be
published once, in the New York Times and The Wall Street Journal (national
edition), notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
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notification or publication, any unclaimed balance of such money then remaining
will be repaid to the Company.
SECTION 8.07. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any United
States dollars or non-callable Government Securities in accordance with Section
8.02 or 8.03 hereof, as the case may be, by reason of any order or judgment of
any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then the Company's obligations under this
Indenture and the Notes shall be revived and reinstated as though no deposit had
occurred pursuant to Section 8.02 or 8.03 hereof until such time as the Trustee
or Paying Agent is permitted to apply all such money in accordance with Section
8.02 or 8.03 hereof, as the case may be; PROVIDED, HOWEVER, that, if the Company
makes any payment of principal of, premium, if any, or interest on any Note
following the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Notes to receive such payment from the
money held by the Trustee or Paying Agent.
ARTICLE IX
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01. WITHOUT CONSENT OF HOLDERS OF NOTES.
Notwithstanding Section 9.02 of this Indenture, the Company, a
Guarantor (with respect to a Subsidiary Guarantee or this Indenture to which it
is a party) and the Trustee may amend or supplement this Indenture, the
Subsidiary Guarantee or the Notes without the consent of any Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in
place of certificated Notes or to alter the provisions of Article 2 hereof
(including the related definitions) in a manner that does not materially
adversely affect any Holder;
(c) to provide for the assumption of the Company's or a
Guarantor's obligations to the Holders of the Notes by a successor to the
Company or a Guarantor pursuant to Article 5 or Article 11 hereof;
(d) to make any change that would provide any additional
rights or benefits to the Holders of the Notes or that does not adversely affect
the legal rights hereunder of any Holder of the Notes;
(e) to comply with requirements of the SEC in order to effect
or maintain the qualification of this Indenture under the TIA;
Upon the request of the Company accompanied by a resolution of
its Board of Directors authorizing the execution of any such amended or
supplemental indenture, and upon receipt by the Trustee of the documents
described in Section 7.02 hereof, the Trustee shall join with the Company and
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the Guarantors in the execution of any amended or supplemental indenture
authorized or permitted by the terms of this Indenture and to make any further
appropriate agreements and stipulations that may be therein contained, but the
Trustee shall not be obligated to enter into such amended or supplemental
indenture that affects its own rights, duties or immunities under this Indenture
or otherwise.
SECTION 9.02. WITH CONSENT OF HOLDERS OF NOTES.
Except as provided below in this Section 9.02, the Company and
the Trustee may amend or supplement this Indenture (including Section 3.09, 4.10
and 4.15 hereof), the Subsidiary Guarantees and the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in principal
amount of the Notes then outstanding voting as a single class (including
consents obtained in connection with a tender offer or exchange offer for, or
purchase of, the Notes), and, subject to Sections 6.04 and 6.07 hereof, any
existing Default or Event of Default (other than a Default or Event of Default
in the payment of the principal of, premium, if any, or interest on the Notes,
except a payment default resulting from an acceleration that has been rescinded)
or compliance with any provision of this Indenture, the Subsidiary Guarantees or
the Notes may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Notes voting as a single class
(including consents obtained in connection with a tender offer or exchange offer
for, or purchase of, the Notes). Section 2.08 hereof shall determine which Notes
are considered to be "outstanding" for purposes of this Section 9.02.
Upon the request of the Company accompanied by a resolution of
its Board of Directors authorizing the execution of any such amended or
supplemental indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid,
and upon receipt by the Trustee of the documents described in Section 7.02
hereof, the Trustee shall join with the Company in the execution of such amended
or supplemental indenture unless such amended or supplemental indenture directly
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such amended or supplemental indenture.
It shall not be necessary for the consent of the Holders of
Notes under this Section 9.02 to approve the particular form of any proposed
amendment or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section
becomes effective, the Company shall mail to the Holders of Notes affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such amended or
supplemental indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the
Holders of a majority in aggregate principal amount of the Notes then
outstanding voting as a single class may waive compliance in a particular
instance by the Company with any provision of this Indenture or the Notes.
However, without the consent of each Holder affected, an amendment or waiver
under this Section 9.02 may not (with respect to any Notes held by a
non-consenting Holder):
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(a) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of
any Note or alter or waive any of the provisions with respect to the redemption
of the Notes except as provided above with respect to Sections 3.09, 4.10 and
4.15 hereof;
(c) reduce the rate of or change the time for payment of
interest on any Note;
(d) waive a Default or Event of Default in the payment of
principal of or premium or interest on the Notes (except a rescission of
acceleration of the Notes by the Holders of at least a majority in aggregate
principal amount of the then outstanding Notes and a waiver of the payment
default that resulted from such acceleration);
(e) make any Note payable in money other than that stated in
the Notes;
(f) make any change in the provisions of this Indenture
relating to waivers of past Defaults or the rights of Holders of Notes to
receive payments of principal of or premium or interest on the Notes;
(g) waive a redemption payment with respect to any Note (other
than a payment required by one of the covenants described in Sections 3.09, 4.10
and 4.15).
(h) release any Guarantor from its Subsidiary Guarantee; or
(i) make any change in Section 6.04 or 6.07 hereof or in the
foregoing amendment and waiver provisions.
In addition, any amendment to the provisions of Article 10 of
this Indenture (which relate to subordination) will require the consent of the
Holders of at least 75% in aggregate principal amount of the Notes then
outstanding if such amendment would adversely affect the rights of Holders of
Notes.
SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Notes
shall be set forth in a amended or supplemental indenture that complies with the
TIA as then in effect.
SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder of a Note is a continuing consent by the Holder of a
Note and every subsequent Holder of a Note or portion of a Note that evidences
the same debt as the consenting Holder's Note, even if notation of the consent
is not made on any Note. However, any such Holder of a Note or subsequent Holder
of a Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
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SECTION 9.05. NOTATION ON OR EXCHANGE OF NOTES.
The Trustee may place an appropriate notation about an
amendment, supplement or waiver on any Note thereafter authenticated. The
Company in exchange for all Notes may issue and the Trustee shall, upon receipt
of an Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note
shall not affect the validity and effect of such amendment, supplement or
waiver.
SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
The Company may not sign an amendment or supplemental indenture until the Board
of Directors approves it. In executing any amended or supplemental indenture,
the Trustee shall be entitled to receive and (subject to Section 7.01 hereof)
shall be fully protected in relying upon, in addition to the documents required
by Section 12.04 hereof, an Officers' Certificate and an Opinion of Counsel
stating that (i) the execution of such amended or supplemental indenture is
authorized or permitted by this Indenture, (ii) such amended or supplemental
indenture complies with this Indenture and, (iii) in the event that such
amendment or supplemental indenture is being executed pursuant to Section 5.01
or 11.01 hereof, the surviving Person assumes the Obligations of this Indenture
and the Notes.
ARTICLE X
SUBORDINATION
SECTION 10.01. AGREEMENT TO SUBORDINATE.
The Company and the Guarantors agree, and each Holder by
accepting a Note and Subsidiary Guarantee agrees, that the principal of and
interest and premium (if any) on the Notes and all Subsidiary Guarantees in
respect thereof are subordinated in right of payment, to the extent and in the
manner provided in this Article 10 and Section 11.03, to the prior payment in
full in cash or Cash Equivalents of all Senior Debt (whether outstanding on the
date hereof or hereafter created, incurred, assumed or guaranteed), and that the
subordination is for the benefit of the holders of Senior Debt, each of whom
shall be entitled to enforce this Article 10 and Section 11.02 as a third party
beneficiary hereof. Notwithstanding anything to the contrary contained herein,
the Indebtedness of the Company evidenced by the Notes ranks subordinated (and
junior in right of payment) to Indebtedness of the Company evidenced by the
Senior Subordinated Notes.
SECTION 10.02. CERTAIN DEFINITIONS.
"Designated Senior Debt" means any Indebtedness outstanding
under the Senior Credit Facilities until the Senior Credit Facilities have been
paid in full in cash and discharged, and thereafter means any Credit Facility or
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any other Senior Debt in excess of $25 million designated by the Company as
"Designated Senior Debt" for the purposes of this Article 10.
"Permitted Junior Securities" means Equity Interests in the
Company or debt securities of the Company or the relevant Guarantor that are
subordinated to all Senior Debt (and any debt securities issued in exchange for
Senior Debt) or Guarantor Senior Debt (and any debt securities issued in
exchange for Guarantor Senior Debt), as applicable, to substantially the same
extent as, or to a greater extent than, the Notes are subordinated to Senior
Debt or the Subsidiary Guarantees are subordinated to Guarantor Senior Debt, as
applicable, pursuant to this Indenture.
"Representative" means the indenture trustee or other trustee,
agent or representative for any holder or holders of Senior Debt.
"Senior Debt" means (i) all Indebtedness outstanding under
Credit Facilities and all Hedging Obligations with respect thereto, (ii) all
Indebtedness of the Company that is senior to the Notes (including the Senior
Subordinated Notes), (iii) any other Indebtedness of the Company or any
Guarantor permitted to be incurred under the terms of this Indenture, unless the
instrument under which such Indebtedness is incurred expressly provides that it
is on a parity with or subordinated in right of payment to the Notes or the
Subsidiary Guarantees and (iv) all Obligations of the Company or any Guarantor
with respect to the foregoing. Notwithstanding anything to the contrary in the
foregoing, Senior Debt will not include (a) any liability for federal, state,
local or other taxes owed or owing by the Company, (b) any Indebtedness of the
Company or any Guarantor to any of its Subsidiaries or other Affiliates, (c) any
trade payables or (d) any Indebtedness that is incurred in violation of this
Indenture; PROVIDED that Indebtedness under Credit Facilities will not cease to
be Senior Debt if incurred based upon a written certificate from a purported
officer of the Company to the effect that such Indebtedness was permitted by
this Indenture to be incurred.
A distribution may consist of cash, securities or other
property, by set-off or otherwise. Any payment pursuant to an Asset Sale Offer
or Change of Control Offer shall constitute a distribution subject to this
Article 10. The making of any deposit pursuant to Article 8 shall constitute a
distribution subject to this Article 10 to the extent provided in Article 8.
SECTION 10.03. LIQUIDATION; DISSOLUTION; BANKRUPTCY.
Upon any payment or distribution to creditors of the Company
or any Guarantor in a liquidation or dissolution of the Company or any Guarantor
or in a bankruptcy, reorganization, insolvency, receivership or similar
proceeding relating to the Company or any Guarantor or its property, in an
assignment for the benefit of creditors or any marshaling of the Company's or
any Guarantor's assets and liabilities:
(1) holders of Senior Debt shall be entitled to receive
payment in full in cash or Cash Equivalents of all Obligations due in respect of
such Senior Debt (including interest after the commencement of any such
proceeding at the rate and on the terms specified in the applicable Senior Debt
whether or not the claim for such interest is allowable or enforceable in such
proceeding) before Holders of the Notes shall be entitled to receive any payment
or distribution with respect to the Notes (except that Holders may receive (i)
Permitted Junior Securities and (ii) payments and other distributions made from
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any defeasance trust created pursuant to Section 8.01 hereof, if payment of the
Notes was permitted on the date the defeasance deposit was made); and
(2) until all Obligations with respect to Senior Debt
(including interest after the commencement of any such proceeding at the rate
and on the terms specified in the applicable Senior Debt whether or not the
claim for such interest is allowable or enforceable in such proceeding) are paid
in full in cash or Cash Equivalents, any payment or distribution to which the
Holders of Notes would be entitled but for this Article 10 shall be made to
holders of Senior Debt (except that Holders of Notes may receive (i) Permitted
Junior Securities and (ii) payments and other distributions made from any
defeasance trust created pursuant to Section 8.01 hereof, if payment of the
Notes was permitted on the date the defeasance deposit was made), as their
interests may appear.
SECTION 10.04. DEFAULT ON DESIGNATED SENIOR DEBT.
The Company may not make (and the Guarantors may not make) any
payment or distribution to the Trustee or any Holder in respect of Obligations
with respect to the Notes and may not acquire from the Trustee or any Holder any
Notes for cash or property (other than (i) Permitted Junior Securities and (ii)
payments and other distributions made from any defeasance trust created pursuant
to Section 8.01 hereof) until all principal and other Obligations with respect
to the Senior Debt have been paid in full in cash or Cash Equivalents if:
(i) a default in the payment of any principal or
other Obligations with respect to any Credit Facility occurs and is continuing
beyond any applicable grace period in the agreement, indenture or other document
governing such Credit Facility; or
(ii) a default, other than a payment default, on
Designated Senior Debt occurs and is continuing that then permits holders of the
Designated Senior Debt to accelerate its maturity and the Trustee receives a
notice of the default (a "Payment Blockage Notice") from a Person who may give
it pursuant to Section 10.12 hereof. If the Trustee receives any such Payment
Blockage Notice, no subsequent Payment Blockage Notice shall be effective for
purposes of this Section unless and until at least three hundred sixty (360)
days shall have elapsed since the effectiveness of the immediately prior Payment
Blockage Notice. No nonpayment default that existed or was continuing on the
date of delivery of any Payment Blockage Notice to the Trustee shall be, or be
made, the basis for a subsequent Payment Blockage Notice unless such default has
been cured or waived. Notwithstanding the foregoing, if a Payment Blockage
Notice is given by a holder of Designated Senior Debt other than a Credit
Facility during the 360-day period, a representative of a Credit Facility may
give another Payment Blockage Notice during the 360-day period; PROVIDED,
HOWEVER, that the total number of days during which any period of payment
blockage is in effect does not exceed one hundred seventy nine (179) days during
any 360-day period.
The Company may and shall resume payments on and distributions
in respect of the Notes and may acquire them upon:
(1) in the case of a payment default, the date upon which the
default is cured or waived or has ceased to exist or such Designated Senior Debt
has been discharged or repaid in full, or
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(2) in the case of a default referred to in Section 10.04(ii)
hereof, the earlier of (A) the date on which such default is cured or waived or
has ceased to exist or such Designated Senior Debt has been discharged or repaid
in full and (B) one hundred seventy nine (179) days after the Payment Blockage
Notice is received if the maturity of such Designated Senior Debt has not been
accelerated, if this Article 10 otherwise permits the payment, distribution or
acquisition at the time of such payment or acquisition.
SECTION 10.05. ACCELERATION OF SECURITIES.
If payment of the Securities is accelerated because of an
Event of Default, the Company shall promptly notify holders of Senior Debt of
the acceleration.
SECTION 10.06. WHEN DISTRIBUTION MUST BE PAID OVER.
In the event that the Trustee receives any payment or
distribution in respect of any Obligations with respect to the Notes at a time
when a Responsible Officer of the Trustee has actual knowledge that such payment
or distribution is prohibited by Section 10.03 or 10.04 hereof or in the event
any Holder receives any payment of any Obligations with respect to the Notes at
a time when such payment is prohibited by Section 10.03 or 10.04 hereof, such
payment or distribution shall be held by the Trustee or such Holder in trust for
the benefit of, and shall be paid forthwith over and delivered, upon written
request, to, the holders of Senior Debt or their Representative under the
indenture or other agreement (if any) pursuant to which Senior Debt may have
been issued, as their respective interests may appear, for application to the
payment of all Obligations with respect to Senior Debt remaining unpaid
(including interest after the commencement of any such proceeding at the rate
and on the terms specified in the applicable Senior Debt whether or not the
claim for such interest is allowable or enforceable in such proceeding) to the
extent necessary to pay such Obligations in full in cash or Cash Equivalents in
accordance with their terms, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Debt.
With respect to the holders of Senior Debt, the Trustee
undertakes to perform only such obligations on the part of the Trustee as are
specifically set forth in this Article 10, and no implied covenants or
obligations with respect to the holders of Senior Debt shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Debt.
SECTION 10.07. NOTICE BY COMPANY.
The Company shall promptly notify the Trustee and the Paying
Agent of any facts known to the Company that would cause a payment of any
Obligations with respect to the Notes to violate this Article 10, but failure to
give such notice shall not affect the subordination of the Notes to the Senior
Debt or the rights of holders of Senior Debt as provided in this Article 10.
SECTION 10.08. SUBROGATION.
After all Senior Debt is paid in full in cash or Cash
Equivalents and until the Notes are paid in full, Holders of Notes shall be
subrogated (equally and ratably with all other Indebtedness PARI PASSU with the
Notes) to the rights of holders of Senior Debt to receive distributions
applicable to Senior Debt to the extent that distributions otherwise payable to
the Holders of Notes have been applied to the payment of Senior Debt, except
that no right of subrogation shall apply to the extent any distribution is
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applied to pay any claim for interest that is not allowed or enforceable in any
proceeding referred to in Section 10.03. A distribution made under this Article
10 to holders of Senior Debt that otherwise would have been made to Holders of
Notes is not, as between the Company and Holders, a payment by the Company on
the Notes.
SECTION 10.09. RELATIVE RIGHTS.
This Article 10 defines the relative rights of Holders of
Notes and holders of Senior Debt. Nothing in this Indenture shall:
(1) impair, as between the Company and Holders of Notes, the
obligation of the Company, which is absolute and unconditional, to pay principal
of and interest on the Notes in accordance with their terms;
(2) affect the relative rights of Holders of Notes and
creditors of the Company other than their rights in relation to holders of
Senior Debt; or
(3) prevent the Trustee or any Holder of Notes from exercising
its available remedies upon a Default or Event of Default, subject to the rights
of holders and owners of Senior Debt to receive distributions and payments
otherwise payable to Holders of Notes.
If the Company fails because of this Article 10 to pay
principal of or interest on a Note on the due date, the failure is still a
Default or Event of Default.
SECTION 10.10. SUBORDINATION NOT PREJUDICED.
No right of any holder of any Senior Debt to enforce
subordination as provided in this Article 10 shall at any time in any way be
prejudiced, affected or impaired by any act or failure to act on the part of the
Company or any of its Subsidiaries or by any act or failure to act on the part
of any holder of Senior Debt or by any breach or default by the Company or any
of its Subsidiaries in the performance or observance of any promise, covenant or
obligation enforceable by any Holder of the Notes, regardless of any knowledge
thereof that any holder of Senior Debt may have or otherwise be charged with.
Without limiting the foregoing, each holder of any Senior Debt may at any time
and from time to time, without the consent of or notice of any Holder of the
Notes, without incurring any responsibility or liability to any Holder of the
Notes and without in any manner prejudicing, affecting or impairing the
obligations of any Holder of the Notes under this Article 10:
(1) change the manner, place or terms of payment or extend the
time of payment of, or increase (subject to Section 4.09), renew or alter,
compromise, accelerate, extend or refinance, any Senior Debt or any agreement,
guaranty, lien or obligation of the Company or any of its Subsidiaries or any
other Person in any manner related thereto, or otherwise amend, supplement or
change in any manner any Senior Debt or any such agreement, guaranty, lien or
obligation;
(2) take or fail to take any collateral security for any
Senior Debt or take or fail to take any action which may be necessary or
appropriate to ensure that any security interest or lien upon any property
securing any Senior Debt is duly enforceable or perfected or entitled to
priority as against any other lien or to ensure that any proceeds of any
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property subject to any security interest or lien are applied to the payment of
any Senior Debt;
(3) release, discharge or permit the lapse of any or all
security interests or liens upon any property at any time securing any Senior
Debt; or
(4) exercise or enforce, in any manner, order or sequence, or
fail to exercise or enforce, any right or remedy against the Company or any of
its Subsidiaries or any collateral security or any other Person or property in
respect of any Senior Debt or any security interest or lien securing any Senior
Debt or any right under this Indenture, and apply any payment or proceeds of
collateral in any order of application.
No exercise of, delay in exercising or failure to exercise any
right arising under this Article 10, no act or omission of any holder of Senior
Debt in respect of the Company or any of its Subsidiaries or any other Person or
any collateral security for any Senior Debt or any right arising under this
Article 10, no change, impairment, or suspension of any right or remedy of any
holder of any Senior Debt, no other act, failure to act, circumstance,
occurrence or event which, but for this provision, would or could act as a
release or exoneration of the obligations of the Holders of the Notes under this
Article 10 shall in any way affect, decrease, diminish or impair any of the
obligations of the Holders of the Notes under this Article 10 or give any Holder
of the Notes any recourse or defense against any holder of the Senior Debt in
respect of any right arising under this Article 10.
SECTION 10.11. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to
holders of Senior Debt, the distribution may be made and the notice given to
their Representative.
Upon any payment or distribution of assets of the Company
referred to in this Article 10, the Trustee and the Holders of Notes shall be
entitled to rely upon any order or decree made by any court of competent
jurisdiction or upon any certificate of such Representative or of the
liquidating trustee or agent or other Person making any distribution to the
Trustee or to the Holders of Notes for the purpose of ascertaining the Persons
entitled to participate in such distribution, the holders of the Senior Debt and
other Indebtedness of the Company, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article 10.
SECTION 10.12. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding the provisions of this Article 10 or any other
provision of this Indenture, the Trustee shall not be charged with knowledge of
the existence of any facts that would prohibit the making of any payment or
distribution by the Company, unless the Trustee shall have received at its
Corporate Trust Office not later than the fifth (5th) Business Day immediately
preceding the date of such payment written notice of facts that would cause the
payment of any Obligations with respect to the Notes to violate this Article 10.
Only the Company or a Representative (or, if there is no Representative for any
holder of Senior Debt, such holder) may give the notice. Nothing in this Article
10 shall impair the claims of, or payments to, the Trustee under or pursuant to
Section 7.07 hereof.
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The Trustee in its individual or any other capacity may hold
Senior Debt with the same rights, and subject to the same obligations, it would
have if it were not Trustee. Any Agent may do the same with like rights and
obligations.
SECTION 10.13. AUTHORIZATION TO EFFECT SUBORDINATION.
Each Holder of Notes, by the Holder's acceptance thereof,
authorizes and directs the Trustee on such Holder's behalf to take such action
as may be necessary or appropriate to effectuate the subordination as provided
in this Article 10, and appoints the Trustee to act as such Holder's
attorney-in-fact for any and all such purposes. If the Trustee does not file a
proper proof of claim or proof of debt in the form required in any proceeding
referred to in Section 6.09 hereof at least thirty (30) days before the
expiration of the time to file such claim, each Representative is hereby
authorized to file an appropriate claim for and on behalf of the Holders of the
Notes.
SECTION 10.14. REINSTATEMENT.
The provisions of this Article 10 shall continue to be
effective or reinstated, as the case may be, if at any time any payment of any
of the Senior Debt is rescinded or must otherwise be returned by the
Representative or any other holder of Senior Debt upon the insolvency,
bankruptcy or reorganization of the Company or any Guarantor or otherwise, all
as though such payment had not been made.
SECTION 10.15. AMENDMENTS.
The provisions of this Article 10 and Section 11.02 and
related definitions of terms used therein shall not be amended or modified
without the written consent of the holders of all Senior Debt at the time
outstanding.
ARTICLE XI
SUBSIDIARY GUARANTEES
SECTION 11.01. GUARANTEE.
Subject to this Article 11, each of the Guarantors hereby,
jointly and severally, unconditionally guarantees to each Holder of a Note
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns, irrespective of the validity and enforceability of this Indenture,
the Notes or the obligations of the Company hereunder or thereunder, that: (a)
the principal of and interest on the Notes will be promptly paid in full when
due, whether at maturity, by acceleration, redemption or otherwise, and interest
on the overdue principal of and interest on the Notes, if any, if lawful, and
all other obligations of the Company to the Holders or the Trustee hereunder or
thereunder will be promptly paid in full or performed, all in accordance with
the terms hereof and thereof; and (b) in case of any extension of time of
payment or renewal of any Notes or any of such other obligations, that same will
be promptly paid in full when due or performed in accordance with the terms of
the extension or renewal, whether at stated maturity, by acceleration or
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otherwise. Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Guarantors shall be jointly
and severally obligated to pay the same immediately. Each Guarantor agrees that
this is a guarantee of payment and not a guarantee of collection.
The Guarantors hereby agree that their obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Notes or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Notes with respect
to any provisions hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance which might
otherwise constitute a legal or equitable discharge or defense of a guarantor.
Each Guarantor hereby waives diligence, presentment, demand of payment, filing
of claims with a court in the event of insolvency or bankruptcy of the Company,
any right to require a proceeding first against the Company, protest, notice and
all demands whatsoever and covenant that this Note Guarantee shall not be
discharged except by complete performance of the obligations contained in the
Notes and this Indenture.
If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors or any custodian, trustee,
liquidator or other similar official acting in relation to either the Company or
the Guarantors, any amount paid by either to the Trustee or such Holder, this
Note Guarantee, to the extent theretofore discharged, shall be reinstated in
full force and effect.
Each Guarantor agrees that it shall not be entitled to any
right of subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed hereby.
Each Guarantor further agrees that, as between the Guarantors, on the one hand,
and the Holders and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 hereof
for the purposes of this Subsidiary Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (y) in the event of any declaration of
acceleration of such obligations as provided in Article 6 hereof, such
obligations (whether or not due and payable) shall forthwith become due and
payable by the Guarantors for the purpose of this Subsidiary Guarantee. The
Guarantors shall have the right to seek contribution from any non-paying
Guarantor so long as the exercise of such right does not impair the rights of
the Holders under the Guarantee.
SECTION 11.02. SUBORDINATION OF SUBSIDIARY GUARANTEE.
The Obligations of each Guarantor under its Subsidiary
Guarantee pursuant to this Article 11 shall be junior and subordinated to the
Senior Debt of such Guarantor on the same basis as the Notes are junior and
subordinated to Senior Debt of the Company. For the purposes of the foregoing
sentence, the Trustee and the Holders shall have the right to receive and/or
retain payments by any of the Guarantors only at such times as they may receive
and/or retain payments in respect of the Notes pursuant to this Indenture,
including Article 10 hereof.
SECTION 11.03. LIMITATION ON GUARANTOR LIABILITY.
Each Guarantor, and by its acceptance of Notes, each Holder,
hereby confirms that it is the intention of all such parties that the Subsidiary
Guarantee of such Guarantor not constitute a fraudulent transfer or conveyance
for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar federal or state law to the
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extent applicable to any Subsidiary Guarantee. To effectuate the foregoing
intention, the Trustee, the Holders and the Guarantors hereby irrevocably agree
that the obligations of such Guarantor under its Subsidiary Guarantee and this
Article 11 shall be limited to the maximum amount as will, after giving effect
to such maximum amount and all other contingent and fixed liabilities of such
Guarantor that are relevant under such laws, and after giving effect to any
collections from, rights to receive contribution from or payments made by or on
behalf of any other Guarantor in respect of the obligations of such other
Guarantor under this Article 11, result in the obligations of such Guarantor
under its Subsidiary Guarantee not constituting a fraudulent transfer or
conveyance.
SECTION 11.04. EXECUTION AND DELIVERY OF NOTE GUARANTEE.
To evidence its Subsidiary Guarantee set forth in Section
11.01, each Guarantor hereby agrees that a notation of such Subsidiary Guarantee
substantially in the form included in Exhibit B shall be endorsed by an Officer
of such Guarantor on each Note authenticated and delivered by the Trustee and
that this Indenture shall be executed on behalf of such Guarantor by its
President or one of its Vice Presidents.
Each Guarantor hereby agrees that its Subsidiary Guarantee set
forth in Section 11.01 shall remain in full force and effect notwithstanding any
failure to endorse on each Subsidiary a notation of such Subsidiary Guarantee.
If an Officer whose signature is on this Indenture or on the
Subsidiary Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which a Subsidiary Guarantee is endorsed, the
Subsidiary Guarantee shall be valid nevertheless.
The delivery of any Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the
Subsidiary Guarantee set forth in this Indenture on behalf of the Guarantors.
In the event that the Company creates or acquires any new
domestic Restricted Subsidiaries subsequent to the date of this Indenture, if
required by Section 4.20 hereof, the Company shall cause such domestic
Restricted Subsidiaries to execute supplemental indentures to this Indenture in
the form contemplated by Section 4.20 and Subsidiary Guarantees in the form
included in Exhibit B in accordance with Section 4.20 hereof and this Article
11, to the extent applicable.
SECTION 11.05. GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
No Guarantor may consolidate with or merge with or into
(whether or not such Guarantor is the surviving Person) another corporation,
Person or entity whether or not affiliated with such Guarantor unless:
(a) subject to the provisions of Section 11.06 hereof, the
Person formed by or surviving any such consolidation or merger (if other than a
Guarantor) assumes all the obligations of such Guarantor pursuant to a
supplemental indenture in form and substance reasonably satisfactory to the
Trustee, under the Notes and the Indenture;
(b) immediately after giving effect to such transaction, no
Default or Event of Default exists; and
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(c) the Company would be permitted by virtue of the Company's
pro forma Debt to Cash Flow Ratio, immediately after giving effect to such
transaction, to incur at least $1.00 of additional Indebtedness pursuant to the
Debt to Cash Flow Ratio test set forth in Section 4.09 hereof.
In case of any such consolidation, merger, sale or conveyance
and upon the assumption by the successor Person, by supplemental indenture,
executed and delivered to the Trustee and satisfactory in form to the Trustee,
of the Subsidiary Guarantee endorsed upon the Notes and the due and punctual
performance of all of the covenants and conditions of this Indenture to be
performed by the Guarantor, such successor Person shall succeed to and be
substituted for the Guarantor with the same effect as if it had been named
herein as a Guarantor. Such successor Person thereupon may cause to be signed
any or all of the Subsidiary Guarantees to be endorsed upon all of the Notes
issuable hereunder which theretofore shall not have been signed by the Company
and delivered to the Trustee. All the Subsidiary Guarantees so issued shall in
all respects have the same legal rank and benefit under this Indenture as the
Subsidiary Guarantees theretofore and thereafter issued in accordance with the
terms of this Indenture as though all of such Subsidiary Guarantees had been
issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 hereof, and
notwithstanding clauses (a) and (b) above, nothing contained in this Indenture
or in any of the Notes shall prevent any consolidation or merger of a Guarantor
with or into the Company or another Guarantor, or shall prevent any sale or
conveyance of the property of a Guarantor as an entirety or substantially as an
entirety to the Company or another Guarantor.
SECTION 11.06. RELEASES FOLLOWING SALE OF ASSETS.
If any Guarantor at any time ceases to be a Subsidiary of the
Company by reason of any Asset Sale, merger or consolidation or otherwise, or in
the event of a sale or other disposition of all or substantially all of the
assets of any Guarantor, then such Guarantor (in the event of any Asset Sale or
other disposition, by way of merger, consolidation or otherwise, of capital
stock of such Guarantor) or the Person acquiring the property (in the event of a
sale or other disposition of all or substantially all of the assets of such
Guarantor) will be released and relieved of any obligations (if any) under the
Guarantor's Subsidiary Guarantee. Upon delivery by the Company to the Trustee of
an Officers' Certificate and an Opinion of Counsel to the effect that such sale
or other disposition was made by the Company in accordance with the applicable
provisions of this Indenture, including without limitation Section 4.10 hereof
(to the extent application to such sale or disposition at the time of
consummation thereof), the Trustee shall execute any documents reasonably
required in order to evidence the release of any Guarantor from its obligations
under its Subsidiary Guarantee.
Any Guarantor not released from its obligations under its
Subsidiary Guarantee shall remain liable for the full amount of principal of and
interest on the Notes and for the other obligations of any Guarantor under this
Indenture as provided in this Article 11.
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ARTICLE XII
MISCELLANEOUS
SECTION 12.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or
conflicts with the duties imposed by a provision of the TIA or another provision
that would be required or deemed under the TIA to be part of and govern this
Indenture if this Indenture were subject thereto, the latter provision shall
control. If any provision of this Indenture modifies or excludes any provision
of the TIA that may be so modified or excluded, the later provision shall be
deemed to apply to this Indenture as so modified or to be excluded, as the case
may be.
SECTION 12.02. NOTICES.
Any notice or communication by the Company, any Guarantor or
the Trustee to the others is duly given if in writing and delivered in Person or
mailed by first class mail, telecopier or overnight air courier guaranteeing
next day delivery, to the others' address:
If to the Company and/or any Guarantor:
Spanish Broadcasting System, Inc.
2601 South Bayshore Drive
Coconut Grove, Florida 33133
Telecopier No.: (305) 446-5148
Attention: Joseph A. Garcia
With a copy to:
Kaye Scholer LLP
425 Park Avenue
New York, New York 10022
Telecopier No.: (212) 836-7152
Attention: William E. Wallace, Esq.
If to the Trustee:
Wachovia Bank, National Association
200 South Biscayne Boulevard, 14th Floor
Miami, Florida 33131
Telecopier No.: (305) 789-4678/4679
Attention: Corporate Trust Department
The Company, any Guarantor or the Trustee, by notice to the
others may designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to
Holders) shall be deemed to have been duly given: at the time delivered by hand,
if personally delivered; five (5) Business Days after being deposited in the
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mail, postage prepaid, if mailed; when receipt acknowledged, if telecopied; and
the next Business Day after timely delivery to the courier, if sent by overnight
air courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by
first class mail or by overnight air courier guaranteeing next day delivery to
its address shown on the register kept by the Registrar. Any notice or
communication shall also be so mailed to any Person described in TIA ss.313(c),
to the extent required by the TIA. Failure to mail a notice or communication to
a Holder or any defect in it shall not affect its sufficiency with respect to
other Holders.
If a notice or communication is mailed in the manner provided
above within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it
shall mail a copy to the Trustee and each Agent at the same time.
SECTION 12.03. COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS
OF NOTES.
Holders may communicate pursuant to TIA ss.312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA ss.312(c).
SECTION 12.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee
to take any action under this Indenture, the Company shall furnish to the
Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 12.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 12.05 hereof) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied; PROVIDED, HOWEVER, that
the provisions of Section 12.04(b) shall not apply to the initial issuance of
securities under this Indenture.
SECTION 12.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA ss.314(a)(4)) shall comply with the provisions of TIA
ss.314(e) and shall include:
(a) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based;
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(c) a statement that, in the opinion of such Person, he or she
has made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition has
been satisfied; and
(d) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been satisfied.
SECTION 12.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a
meeting of Holders. The Registrar or Paying Agent may make reasonable rules and
set reasonable requirements for its functions.
SECTION 12.07. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS,
EMPLOYEES AND STOCKHOLDERS.
No past, present or future director, officer, employee,
incorporator or stockholder of the Company or any Guarantor, as such, shall have
any liability for any obligations of the Company or such Guarantor under the
Notes, the Subsidiary Guarantees, this Indenture or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder by
accepting a Note waives and releases all such liability.
The waiver and release are part of the consideration for
issuance of the Notes.
SECTION 12.08. GOVERNING LAW.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE
USED TO CONSTRUE THIS INDENTURE, THE NOTES AND THE NOTE GUARANTEES WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 12.09. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other
indenture, loan or debt agreement of the Company or its Subsidiaries or of any
other Person. Any such indenture, loan or debt agreement may not be used to
interpret this Indenture.
SECTION 12.10. SUCCESSORS.
All agreements of the Company in this Indenture and the Notes
shall bind its successors. All agreements of the Trustee in this Indenture shall
bind its successors.
SECTION 12.11. SEVERABILITY.
In case any provision in this Indenture or in the Notes shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
81
SECTION 12.12. COUNTERPART ORIGINALS.
The parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them together represent the
same agreement.
SECTION 12.13. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings of
the Articles and Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part of this Indenture and shall
in no way modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
82
SIGNATURES
Dated as of ____________
SPANISH BROADCASTING SYSTEM, INC.
By:
------------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM OF CALIFORNIA, INC.]
By:
------------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM NETWORK, INC.]
By:
------------------------------------------------
Name:
Title:
[SBS PROMOTIONS, INC.]
By:
------------------------------------------------
Name:
Title:
[SBS FUNDING, INC.]
By:
------------------------------------------------
Name:
Title:
[ALARCON HOLDINGS, INC.]
By:
------------------------------------------------
Name:
Title:
Indenture signature page - 1
[SBS OF GREATER NEW YORK, INC.]
By:
------------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM OF FLORIDA, INC.]
By:
------------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM OF GREATER MIAMI, INC.]
By:
------------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM OF PUERTO RICO, INC.
(DELAWARE)]
By:
------------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM, INC. (NEW JERSEY)]
By:
------------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM OF ILLINOIS, INC.]
By:
-------------------------------------------------
Name:
Title:
Indenture signature page - 2
[SPANISH BROADCASTING SYSTEM OF SAN ANTONIO, INC.]
By:
------------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM OF PUERTO RICO, INC.
(PUERTO RICO)]
By:
------------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM FINANCE CORPORATION]
By:
------------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM SOUTHWEST, INC.]
By:
------------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM - SAN FRANCISCO, INC.]
By:
------------------------------------------------
Name:
Title:
WACHOVIA BANK, NATIONAL ASSOCIATION
By:
------------------------------------------------
Name:
Title:
Indenture signature page - 3
EXHIBIT A
FORM OF 10 3/4% SUBORDINATED EXCHANGE NOTES
(Face of Note)
CUSIP/CINS _________
10 3/4% Subordinated Exchange Notes due 2013
No.________ $__________
SPANISH BROADCASTING SYSTEM, INC.
promises to pay to _________________________________________ registered assigns,
the principal sum of _______________ Dollars on October 15, 2013.
Interest Payment Dates: October 15, and April 15.
Record Dates: October 1 and April 1.
DATED:
SPANISH BROADCASTING SYSTEM, INC.
BY:
--------------------------
Name:
Title:
BY:
--------------------------
Name:
Title:
This is one of the Notes [SEAL]
referred to in the
within-mentioned Indenture:
Wachovia Bank, National Association
as Trustee
By:
---------------------------------
Authorized Signatory
Date of Authentication:
---------------
A-1
(Reverse face of Note)
10 3/4% Subordinated Exchange Notes due 2013
[INSERT THE GLOBAL NOTE LEGEND, IF APPLICABLE PURSUANT TO THE
TERMS OF THE INDENTURE]
Capitalized terms used herein shall have the meanings assigned
to them in the Indenture referred to below unless otherwise indicated.
1. INTEREST. Spanish Broadcasting System, Inc., a Delaware
corporation (the "Company"), promises to pay interest on the principal amount of
this Note at 10 3/4% PER ANNUM from ____________ until maturity. The Company
will pay interest semi-annually on October 15 and April 15 of each year, or if
any such day is not a Business Day, on the next succeeding Business Day (each an
"Interest Payment Date"). Interest will be payable in cash, except that on each
Interest Payment Date occurring on or prior to October 15, 2008, interest may be
paid, at the Company's option, by issuance of additional Notes having an
aggregate principal amount equal to the amount of such interest. Interest on the
Notes will accrue from the most recent date to which interest has been paid or,
if no interest has been paid, from the date of issuance; PROVIDED that if there
is no existing Default in the payment of interest, and if this Note is
authenticated between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; PROVIDED, FURTHER, that the first Interest
Payment Date shall be [_____________]. The Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal and premium, if any, from time to time on demand at a rate that is 1%
per annum in excess of the rate then in effect; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest (without regard to any applicable grace periods) from
time to time on demand at the same rate to the extent lawful. Interest will be
computed on the basis of a 360-day year of twelve 30-day months.
2. METHOD OF PAYMENT. The Company will pay interest on the
Notes (except defaulted interest) to the Persons who are registered Holders of
Notes at the close of business on the October 1 or April 1 next preceding the
Interest Payment Date, even if such Notes are canceled after such record date
and on or before such Interest Payment Date, except as provided in Section 2.12
of the Indenture with respect to defaulted interest. The Notes will be payable
as to principal, premium, if any, and interest at the office or agency of the
Company maintained for such purpose within or without the City and State of New
York, or, at the option of the Company, payment of interest may be made by check
mailed to the Holders at their addresses set forth in the register of Holders,
and provided that payment by wire transfer of immediately available funds will
be required with respect to principal of and interest and premium on, all Global
Notes and all other Notes the Holders of which shall have provided written wire
transfer instructions to the Company or the Paying Agent on or prior to the
record date. Such payment shall be in such coin or currency of the United States
of America as at the time of payment is legal tender for payment of public and
private debts.
3. PAYING AGENT AND REGISTRAR. Initially, Wachovia Bank, N.A.,
the Trustee under the Indenture, will act as Paying Agent and Registrar. The
Company may change any Paying Agent or Registrar without notice to any Holder.
The Company or any of its Subsidiaries may act in any such capacity.
A-2
4. INDENTURE. The Company issued the Notes under an Indenture
dated as of __________________ ("Indenture") among the Company, the Guarantors
named therein and the Trustee. The terms of the Notes include those stated in
the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code ss.ss. 77aaa-77bbbb). The Notes
are subject to all such terms, and Holders are referred to the Indenture and
such Act for a statement of such terms. To the extent any provision of this Note
conflicts with the express provisions of the Indenture, the provisions of the
Indenture shall govern and be controlling. The aggregate principal amount of the
Notes that may be authenticated and delivered under the Indenture is unlimited.
5. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Section 5, the
Company shall not have the option to redeem the Notes pursuant to this Section 5
prior to October 15, 2008. Thereafter, the Company shall have the option to
redeem the Notes, in whole or, from time to time in part, upon not less than 30
nor more than 60 days' notice, at the redemption prices (expressed as
percentages of principal amount) set forth below, plus accrued and unpaid
interest, if any, thereon to the applicable redemption date, if redeemed during
the twelve-month period beginning on October 15 of the years indicated below:
YEAR PERCENTAGE
2008................................. 105.375%
2009................................. 103.583%
2010................................. 101.792%
2011 and thereafter.................. 100.000%
(b) In addition to the foregoing, prior to October 15, 2006,
the Company may, on any one or more occasions, redeem up to 40% of the aggregate
principal amount of Notes (whether issued in exchange for Exchangeable Preferred
Stock or issued in lieu of cash interest payments) at a redemption price of
110.75% of the principal amount thereof, plus accrued and unpaid interest
thereon to the redemption date, with the net cash proceeds of an Equity
Offering; PROVIDED that (i) at least $45.0 million of the aggregate principal
amount of the Notes (whether issued in exchange for the Exchangeable Preferred
Stock or issued in lieu of cash interest payments) remain outstanding
immediately after the occurrence of each such redemption (excluding Notes held
by the Company and its Subsidiaries) and (ii) each such redemption shall occur
within 90 days after the date of the closing of any such Equity Offering.
(c) Notwithstanding the foregoing, no optional redemption may
be authorized or made by the Company at a redemption price less than 101% of the
principal amount of the Notes at any time that the Company is making an offer to
purchase Notes under a Change of Control Offer in accordance with Section 4.15
of the Indenture.
6. MANDATORY REDEMPTION.
Except as set forth in paragraph 7 below, the Company shall
not be required to make mandatory redemption or sinking fund payments with
respect to the Notes.
A-3
7. REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Company shall be
obligated to make an offer (a "Change of Control Offer") to each Holder of Notes
to repurchase all or any part (equal to $1,000 or an integral multiple thereof)
of such Holder's Notes at an offer price in cash equal to 101% of the principal
amount thereof, plus accrued and unpaid interest, thereon to the date of
purchase (the "Change of Control Payment"). Within ten days following a Change
of Control, the Company will mail a notice to each Holder describing the
transaction or transactions that constitute the Change of Control and offering
to repurchase Notes on the date specified in such notice, which date shall be no
earlier than 30 days and no later than 60 days from the date such notice is
mailed (the "Change of Control Payment Date"), pursuant to the procedures
required by the Indenture and described in such notice.
(b) If the Company or a Subsidiary consummates any Asset
Sales, when the aggregate amount of Excess Proceeds exceeds $10.0 million, the
Company shall be required to make an offer to all Holders of Notes and all
holders of other PARI PASSU Indebtedness containing provisions similar to those
set forth in the Indenture with respect to offers to purchase or redeem such
other PARI PASSU Indebtedness with the proceeds of sales of assets (an "Asset
Sale Offer") to purchase the maximum principal amount of Notes and such other
PARI PASSU Indebtedness that may be purchased out of the Excess Proceeds at an
offer price in cash in an amount equal to 100% of the principal amount thereof,
plus accrued and unpaid interest, thereon to the date of purchase, in accordance
with the procedures set forth in the Indenture and in such other PARI PASSU
Indebtedness. To the extent that the aggregate amount of Notes and such other
PARI PASSU Indebtedness tendered pursuant to an Asset Sale Offer is less than
the Excess Proceeds, the Company may use any remaining Excess Proceeds for any
purpose not otherwise prohibited by the Indenture. If the aggregate principal
amount of Notes and such other PARI PASSU Indebtedness surrendered by Holders
thereof exceeds the amount of Excess Proceeds, the Trustee shall select the
Notes and such other PARI PASSU Indebtedness to be purchased on a PRO RATA
basis. Upon completion of an Asset Sale Offer, the amount of Excess Proceeds
shall be reset at zero.
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed
at least 30 days but not more than 60 days before the redemption date to each
Holder whose Notes are to be redeemed at its registered address. Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest ceases to accrue on Notes or
portions thereof called for redemption.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000; PROVIDED, HOWEVER, that Notes may be issued in
denominations of less than $1,000 upon the exchange of the Exchangeable
Preferred Stock for the Notes such that each holder of Exchangeable Preferred
Stock shall receive Notes in a principal amount equal to the aggregate
liquidation preference of the Exchangeable Preferred Stock held by such holder
on the Notes Issue Date; and PROVIDED, FURTHER, HOWEVER, that any Notes issued
in lieu of cash payments of interest may be issued in denominations of less than
$1,000. The transfer of Notes may be registered and Notes may be exchanged as
provided in the Indenture. The Registrar and the Trustee may require a Holder,
A-4
among other things, to furnish appropriate endorsements and transfer documents
and the Company may require a Holder to pay any taxes and fees required by law
or permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Company
need not exchange or register the transfer of any Notes for a period of 15 days
before the mailing of a notice of redemption of Notes to be redeemed or during
the period between a record date and the corresponding Interest Payment Date.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may
be treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions, the Indenture, the Subsidiary Guarantees or the Notes may be amended
or supplemented with the consent of the Holders of at least a majority in
principal amount of the then outstanding Notes voting as a single class
(including without limitation, consents obtained in connection with a purchase
of, or tender offer or exchange offer for, Notes), and any existing default or
compliance with any provision of the Indenture, the Subsidiary Guarantees or the
Notes may be waived with the consent of the Holders of a majority in principal
amount of the then outstanding Notes voting as a single class (including
consents obtained in connection with a tender offer or exchange offer for
Notes). Without the consent of any Holder of Notes, the Indenture, the
Subsidiary Guarantees or the Notes may be amended or supplemented to cure any
ambiguity, defect or inconsistency, to provide for uncertificated Notes in
addition to or in place of certificated Notes, to provide for the assumption of
the Company's or any Guarantor's obligations to Holders of the Notes in the case
of a merger or consolidation or sale of substantially all of the Company's
assets, to make any change that would provide any additional rights or benefits
to the Holders of the Notes or that does not adversely affect the legal rights
under the Indenture of any such Holder or to comply with the requirements of the
SEC in order to effect or maintain the qualification of the Indenture under the
Trust Indenture Act.
12. DEFAULTS AND REMEDIES. Events of Default include: (a) the
Company defaults for 30 days in the payment when due of interest on the Notes,
whether or not such payment is prohibited by the provisions of Article 10 of the
Indenture; (b) the Company defaults in payment when due of the principal of or
premium, if any, on the Notes, whether or not such payment is prohibited by the
provisions of Article 10 of the Indenture; (c) the Company or any Restricted
Subsidiary fails to comply with any of the provisions of Section 4.15 or 5.01 of
the Indenture; (d) the Company or any Restricted Subsidiary fails for 30 days
after written notice by the Trustee or the Holders of at least 25% in principal
amount of the then outstanding Notes to comply with the provisions of Section
3.09, 4.07, 4.09 or 4.10 of the Indenture; (e) the Company or any Restricted
Subsidiary fails for 60 days after written notice by the Trustee or the Holders
of at least 25% in principal amount of the then outstanding Notes to comply with
any of its other agreements in the Indenture or the Notes; (f) the Company or
any Significant Subsidiary defaults under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or evidenced
any Indebtedness for money borrowed by the Company or any of its Restricted
Subsidiaries (or the payment of which is guaranteed by the Company or any of its
Restricted Subsidiaries), whether such Indebtedness or guarantee now exists or
is created after the date of the Indenture, which default (i) is caused by a
A-5
failure to pay (a "Payment Default") principal, or interest on such Indebtedness
when due (after giving effect to any applicable grace period provided in such
Indebtedness on the date of such default) or (ii) results in the acceleration of
such Indebtedness prior to its express maturity and, in each case, the principal
amount of any such Indebtedness, together with the principal amount of any other
such Indebtedness under which there has been a Payment Default or the maturity
of which has been so accelerated, aggregates $5.0 million or more; (g) the
Company or any of its Significant Subsidiaries fails to pay final judgments
aggregating in excess of $5.0 million (net of amounts covered by insurance),
which judgments are not paid, discharged or stayed for a period of 60 days; (h)
except as permitted by the Indenture, any Subsidiary Guarantee shall be held in
any judicial proceeding to be unenforceable or invalid or shall cease for any
reason to be in full force and effect or any Guarantor, or any Person acting on
behalf of any Guarantor, shall deny or disaffirm its obligations under its
Subsidiary Guarantee; (i) certain events of bankruptcy or insolvency with
respect to the Company or any of the Company's Restricted Subsidiaries that
constitutes a Significant Subsidiary or any group of Restricted Subsidiaries of
the Company that, taken together, would constitute a Significant Subsidiary. If
any Event of Default occurs and is continuing, the Trustee or the Holders of at
least 25% in principal amount of the then outstanding Notes may declare all the
Notes to be due and payable immediately. Notwithstanding the foregoing, in the
case of an Event of Default arising from certain events of bankruptcy or
insolvency, with respect to the Company, any Restricted Subsidiary of the
Company that constitutes a Significant Subsidiary or any group of Restricted
Subsidiaries of the Company that, taken together, would constitute a Significant
Subsidiary, all outstanding Notes will become due and payable without further
action or notice. Holders of the Notes may not enforce the Indenture or the
Notes except as provided in the Indenture. Subject to certain limitations,
Holders of a majority in principal amount of the then outstanding Notes may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Notes notice of any continuing Default or Event of
Default (except a Default or Event of Default relating to the payment of
principal or interest) if it determines that withholding notice is in their
interest. In the case of any Event of Default occurring by reason of any willful
action (or inaction) taken (or not taken) by or on behalf of the Company with
the intention of avoiding payment of the premium that the Company would have had
to pay if the Company then had elected to redeem the Notes pursuant to Section
3.07 of the Indenture, an equivalent premium shall also become and be
immediately due and payable to the extent permitted by law upon the acceleration
of the Notes. If an Event of Default occurs on or after October 15, 2008 by
reason of any willful action (or inaction) taken (or not taken) by or on behalf
of the Company with the intention of avoiding payment of the premium that the
Company would have had to pay if the Company then had elected to redeem the
Notes pursuant to the redemption provisions contained in the Notes, then, upon
acceleration of the Notes, an equivalent premium shall also become and be
immediately due and payable, to the extent permitted by law, anything in the
Indenture or in the Notes to the contrary notwithstanding. The Holders of a
majority in aggregate principal amount of the Notes then outstanding by notice
to the Trustee may on behalf of the Holders of all of the Notes waive any
existing Default or Event of Default and its consequences under the Indenture
except a continuing Default or Event of Default in the payment of interest on,
or the principal of, the Notes. The Company is required to deliver to the
Trustee annually a statement regarding compliance with the Indenture, and the
Company is required upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of Default.
13. TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its
individual or any other capacity, may make loans to, accept deposits from, and
A-6
perform services for the Company or its Affiliates, and may otherwise deal with
the Company or its Affiliates, as if it were not the Trustee.
14. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator or stockholder, of the Company, as such, shall not have any
liability for any obligations of the Company under the Notes or the Indenture or
for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Notes.
15. AUTHENTICATION. This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
16. ABBREVIATIONS. Customary abbreviations may be used in the
name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT
(= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).
17. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND
BE USED TO CONSTRUE THIS NOTE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY.
18. SUBORDINATION. Principal of and interest and premium (if
any) on this Note and all Subsidiary Guarantees in respect hereof are
subordinated in right of payment, to the extent and in the manner provided in
the Indenture, to the prior payment in full in cash or Cash Equivalents of all
Senior Debt (each as defined in the Indenture).
19. CUSIP NUMBERS. Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP
numbers in notices of redemption as a convenience to Holders. No representation
is made as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company will furnish to any Holder upon written request
and without charge a copy of the Indenture. Requests may be made to:
Spanish Broadcasting System, Inc.
2601 South Bayshore Drive
Coconut Grove, Florida 33133
Attention: Joseph A. Garcia
A-7
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
- --------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint___________________________________________ to transfer
this Note on the books of the Company. The agent may substitute another to act
for him.
Date: ____________ Your Signature:
-------------------------------
(Sign exactly as your name appears on the face
of this Note)
Tax Identification No:
------------------------
SIGNATURE GUARANTEE:
------------------------------------------------
Signatures must be guaranteed by an "eligible
guarantor institution" meeting the requirements
of the Registrar, which requirements include
membership or participation in the Security
Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may
be determined by the Registrar in addition to,
or in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as
amended.
A-8
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the
Company pursuant to Section 4.10 or 4.15 of the Indenture, check the box below:
[ ] Section 4.10 [ ] Section 4.15
If you want to elect to have only part of the Note purchased
by the Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state
the amount you elect to have purchased: $________
Date: Your Signature:
------------ ------------------------------
(Sign exactly as your name appears on the face
of this Note)
Tax Identification No:
-----------------------
SIGNATURE GUARANTEE:
------------------------------------------------
Signatures must be guaranteed by an "eligible
guarantor institution" meeting the requirements
of the Registrar, which requirements include
membership or participation in the Security
Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may
be determined by the Registrar in addition to,
or in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as
amended.
A-9
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Definitive Note, or exchanges of a part
of another Global Note or Definitive Note for an interest in this Global Note,
have been made:
Principal Amount of Signature of
Amount of increase this Global Note authorized
Amount of decrease in Principal following such Signatory of
in Principal Amount Amount of this decrease (or Trustee or Note
Date of Exchange of this Global Note Global Note increase) Custodian
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EXHIBIT B
GUARANTY
For good and valuable consideration received from the Company
by the undersigned (hereinafter referred to as the "Guarantors," which term
includes any successor or additional Guarantors), the receipt and sufficiency of
which is hereby acknowledged, subject to Section 11.03 of the Indenture, each of
the Guarantors hereby, jointly and severally, unconditionally guarantees,
irrespective of the validity or enforceability of the Obligations of the Company
under the Indenture, the Notes or the Obligations of any other party under the
Notes or the Indenture: (a) the due and punctual payment of the principal and
premium, if any, of and interest on the Notes, whether at maturity, or on an
interest payment date, by acceleration, call for redemption or otherwise, (b)
the due and punctual payment of interest on the overdue principal and premium,
if any, of and interest on the Notes, if any, if lawful, (c) the due and
punctual payment and performance of all other Obligations of the Company under
the Indenture and the Notes, all in accordance with the terms set forth in the
Indenture; and (d) in case of any extension of time of payment or renewal of any
Notes or any of such other Obligations under the Indenture of the Notes, the due
and punctual payment or performance thereof in accordance with the terms of the
extension or renewal, whether at stated maturity, by acceleration or otherwise.
Reference is made to Article 11 of the Indenture for a further
description of the terms of this Guaranty.
This Guaranty is subordinated in right of payment, to the
extent and in the manner provided in the Indenture, to the prior payment in full
in cash or Cash Equivalents of all Senior Debt (each as defined in the
Indenture).
SIGNATURES
Dated as of __________, 2003
[SPANISH BROADCASTING SYSTEM OF CALIFORNIA, INC.]
By:
-----------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM NETWORK, INC.]
By:
-----------------------------------------
Name:
Title:
B-1
[SBS PROMOTIONS, INC.]
By:
-----------------------------------------
Name:
Title:
[SBS FUNDING, INC.]
By:
-----------------------------------------
Name:
Title:
[ALARCON HOLDINGS, INC.]
By:
-----------------------------------------
Name:
Title:
B-2
[SBS OF GREATER NEW YORK, INC.]
By:
---------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM OF FLORIDA, INC.]
By:
---------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM OF GREATER MIAMI,
INC.]
By:
---------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM OF PUERTO RICO, INC.
(DELAWARE)]
By:
---------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM, INC. (NEW JERSEY)]
By:
---------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM OF ILLINOIS, INC.]
By:
---------------------------------------------
Name:
Title:
B-3
[SPANISH BROADCASTING SYSTEM OF SAN ANTONIO, INC.]
By:
----------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM OF PUERTO RICO, INC.
(PUERTO RICO)]
By:
----------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM FINANCE CORPORATION]
By:
----------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM SOUTHWEST, INC.]
By:
----------------------------------------------
Name:
Title:
[SPANISH BROADCASTING SYSTEM - SAN FRANCISCO, INC.]
By:
----------------------------------------------
Name:
Title:
B-4
EXHIBIT C-1
FORM OF CERTIFICATE OF TRANSFER
[Company address block]
[Registrar address block]
Re: [full title of securities]
Reference is hereby made to the Indenture, dated as of
_________________ (the "Indenture"), between Spanish Broadcasting System, Inc.,
as Company (the "Company"), and Wachovia Bank, National Association, as trustee.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Indenture.
___________________, (the "Transferor") owns and proposes to
transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in
the principal amount of $___________ in such Note[s] or interests (the
"Transfer"), to ___________________________ (the "Transferee"), as further
specified in Annex A hereto. In connection with the Transfer, the Transferor
hereby certifies that:
[CHECK ALL THAT APPLY]
1. Check if Transferee will take delivery of a beneficial interest in
the 144A Global Note or a Definitive Note Pursuant to Rule 144A. The Transfer is
being effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933, as amended (the "Securities Act"), and,
accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believed and believes is purchasing the beneficial interest or
Definitive Note for its own account, or for one or more accounts with respect to
which such Person exercises sole investment discretion, and such Person and each
such account is a "qualified institutional buyer" within the meaning of Rule
144A in a transaction meeting the requirements of Rule 144A and such Transfer is
in compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the 144A Global Note or the Definitive Note and in
the Indenture and the Securities Act.
2. Check if Transferee will take delivery of a beneficial interest in
the Regulation S Global Note or a Definitive Note pursuant to Regulation S. The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and, accordingly, the Transferor hereby further
certifies that (i) the Transfer is not being made to a person in the United
States and (x) at the time the buy order was originated, the Transferee was
outside the United States or such Transferor and any Person acting on its behalf
reasonably believed and believes that the Transferee was outside the United
States or (y) the transaction was executed in, on or through the facilities of a
designated offshore securities market and neither such Transferor nor any Person
acting on its behalf knows that the transaction was prearranged with a buyer in
the United States, (ii) no directed selling efforts have been made in
contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S
under the Securities Act, (iii) the transaction is not part of a plan or scheme
C-1-1
to evade the registration requirements of the Securities Act and (iv) if the
proposed transfer is being made prior to the expiration of the Restricted
Period, the transfer is not being made to a U.S. Person or for the account or
benefit of a U.S. Person (other than an Initial Purchaser). Upon consummation of
the proposed transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will be subject to the
restrictions on Transfer enumerated in the Private Placement Legend printed on
the Regulation S Global Note or the Definitive Note and in the Indenture and the
Securities Act.
3. Check and complete if Transferee will take delivery of a beneficial
interest in the IAI Global Note or a Definitive Note pursuant to any provision
of the Securities Act other than Rule 144A or Regulation S. The Transfer is
being effected in compliance with the transfer restrictions applicable to
beneficial interests in Restricted Global Notes and Restricted Definitive Notes
and pursuant to and in accordance with the Securities Act and any applicable
blue sky securities laws of any state of the United States, and accordingly the
Transferor hereby further certifies that (check one):
(a) such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act;
or
(b) such Transfer is being effected to the Company or a subsidiary
thereof;
or
(c) such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in
compliance with the prospectus delivery requirements of the
Securities Act;
or
(d) such Transfer is being effected to an Institutional Accredited
Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule
144 or Rule 904, and the Transferor hereby further certifies
that it has not engaged in any general solicitation within the
meaning of Regulation D under the Securities Act and the
Transfer complies with the transfer restrictions applicable to
beneficial interests in a Restricted Global Note or Restricted
Definitive Notes and the requirements of the exemption
claimed, which certification is supported by (1) a certificate
executed by the Transferor in the form of Exhibit C-3 to the
Indenture and (2) an Opinion of Counsel provided by the
Transferor or the Transferee (a copy of which the Transferor
has attached to this certification), to the effect that such
Transfer is in compliance with the Securities Act. Upon
consummation of the proposed transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or
Definitive Note will be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on
the IAI Global Note and/or the Definitive Notes and in the
Indenture and the Securities Act.
4. Check if Transferee will take delivery of a beneficial interest in
an Unrestricted Global Note or of an Unrestricted Definitive Note.
C-1-2
(a) CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144
under the Securities Act and in compliance with the transfer
restrictions contained in the Indenture and any applicable
blue sky securities laws of any state of the United States and
(ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation
of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive
Note will no longer be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the
Restricted Global Notes, on Restricted Definitive Notes and in
the Indenture.
(b) CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The
Transfer is being effected pursuant to and in accordance with
Rule 903 or Rule 904 under the Securities Act and in
compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any
state of the United States and (ii) the restrictions on
transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will no longer be
subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global
Notes, on Restricted Definitive Notes and in the Indenture.
(c) CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The
Transfer is being effected pursuant to and in compliance with
an exemption from the registration requirements of the
Securities Act other than Rule 144, Rule 903 or Rule 904 and
in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any
State of the United States and (ii) the restrictions on
transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will not be subject to
the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Notes or
Restricted Definitive Notes and in the Indenture.
C-1-3
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.
[Insert Name of Transferor]
By:
---------------------------------
Name:
Title:
Dated:
------------------------
C-1-4
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) a beneficial interest in the:
(i) 144A Global Note (CUSIP _________), or
(ii) Regulation S Global Note (CUSIP _________), or
(iii) IAI Global Note (CUSIP _________); or
(b) a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) a beneficial interest in the:
(i) 144A Global Note (CUSIP _________), or
(ii) Regulation S Global Note (CUSIP _________), or
(iii) IAI Global Note (CUSIP _________), or
(iv) Unrestricted Global Note (CUSIP _________); or
(b) a Restricted Definitive Note; or
(c) an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
C-1-5
EXHIBIT C-2
FORM OF CERTIFICATE OF EXCHANGE
[Company address block]
[Registrar address block]
Re: [full title of securities]
(CUSIP ____________)
Reference is hereby made to the Indenture, dated as of
_________________ (the "Indenture"), between Spanish Broadcasting System, Inc.,
as Company (the "Company"), and Wachovia Bank, National Association, as trustee.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Indenture.
__________________________, (the "Owner") owns and proposes to
exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of $____________ in such Note[s] or interests (the "Exchange").
In connection with the Exchange, the Owner hereby certifies that:
1. Exchange of Restricted Definitive Notes or Beneficial
Interests in a Restricted Global Note for Unrestricted Definitive Notes or
Beneficial Interests in an Unrestricted Global Note
(a) Check if Exchange is from beneficial interest in a
Restricted Global Note to beneficial interest in an Unrestricted Global Note. In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Note for a beneficial interest in an Unrestricted Global Note in an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer, (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable to the
Global Notes and pursuant to and in accordance with the United States Securities
Act of 1933, as amended (the "Securities Act"), (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
beneficial interest in an Unrestricted Global Note is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.
(b) Check if Exchange is from beneficial interest in a
Restricted Global Note to Unrestricted Definitive Note. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Definitive Note, the Owner hereby certifies (i) the Definitive Note
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the Definitive Note is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(c) Check if Exchange is from Restricted Definitive Note to
beneficial interest in an Unrestricted Global Note. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
C-2-1
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) Check if Exchange is from Restricted Definitive Note to
Unrestricted Definitive Note. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
2. Exchange of Restricted Definitive Notes or Beneficial
Interests in Restricted Global Notes for Restricted Definitive Notes or
Beneficial Interests in Restricted Global Notes
(a) Check if Exchange is from beneficial interest in a
Restricted Global Note to Restricted Definitive Note. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for a
Restricted Definitive Note with an equal principal amount, the Owner hereby
certifies that the Restricted Definitive Note is being acquired for the Owner's
own account without transfer. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Definitive Note
issued will continue to be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the Restricted Definitive Note and in
the Indenture and the Securities Act.
(b) Check if Exchange is from Restricted Definitive Note to
beneficial interest in a Restricted Global Note. In connection with the Exchange
of the Owner's Restricted Definitive Note for a beneficial interest in the
[CHECK ONE] 144A Global Note, Regulation S Global Note, IAI Global Note with an
equal principal amount, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with
the Securities Act, and in compliance with any applicable blue sky securities
laws of any state of the United States. Upon consummation of the proposed
Exchange in accordance with the terms of the Indenture, the beneficial interest
issued will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the relevant Restricted Global Note and in the
Indenture and the Securities Act.
C-2-2
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.
[Insert Name of Transferor]
By:
---------------------------------
Name:
Title:
Dated:
------------------------
C-2-3
EXHIBIT C-3
FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Spanish Broadcasting System, Inc.
2601 South Bayshore Drive
Coconut Grove, Florida 33133
Attention: Joseph A. Garcia
[Registrar address block]
Re: 10 3/4% Subordinated Exchange Notes due 2013
Reference is hereby made to the Indenture, dated as of
____________ (the "Indenture"), between Spanish Broadcasting, Inc., as issuers
(the "Issuers"), and Wachovia Bank, National Association, as trustee.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Indenture.
In connection with our proposed purchase of $____________
aggregate principal amount of:
(a) a beneficial interest in a Global Note, or
(b) a Definitive Note, we confirm that:
1. We understand that any subsequent transfer of the Notes or
any interest therein is subject to certain restrictions and conditions set forth
in the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not
been registered under the Securities Act, and that the Notes and any interest
therein may not be offered or sold except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which we
are acting as hereinafter stated, that if we should sell the Notes or any
interest therein, we will do so only (A) to the Issuers or any subsidiary
thereof, (B) in accordance with Rule 144A under the Securities Act to a
"qualified institutional buyer" (as defined therein), (C) to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to you and to the
Issuers a signed letter substantially in the form of this letter and an Opinion
of Counsel in form reasonably acceptable to the Issuers to the effect that such
transfer is in compliance with the Securities Act, (D) outside the United States
in accordance with Rule 904 of Regulation S under the Securities Act, (E)
pursuant to the provisions of Rule 144(k) under the Securities Act or (F)
pursuant to an effective registration statement under the Securities Act, and we
further agree to provide to any person purchasing the Definitive Note or
beneficial interest in a Global Note from us in a transaction meeting the
requirements of clauses (A) through (E) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
B-1
Issuers such certifications, legal opinions and other information as you and the
Issuers may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Notes purchased by us
will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined
in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and
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 Notes, and
we and any accounts for which we are acting are each able to bear the economic
risk of our or its investment.
5. We are acquiring the Notes or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Issuers are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby.
[Insert Name of Accredited Investor]
By:
---------------------------------
Name:
Title:
Dated:
------------------------
B-2
EXHIBIT B
FORM OF LEGENDS
[GLOBAL SHARES LEGEND (include if security is issued as a global certificate):
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO., OR 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 IN AS MUCH 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 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 PREFERRED STOCK SCHEDULE REFERRED TO BELOW.
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH REGISTRAR AND
TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH
THE FOREGOING RESTRICTIONS.]
[GLOBAL RESTRICTED SHARE LEGEND (include if security is not registered under the
Securities Act of 1933): THE SHARES OF SERIES A PREFERRED STOCK EVIDENCED HEREBY
HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE
"SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
EXCEPT (A)(1) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE
TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (4) TO AN
INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, (5) IN ACCORDANCE WITH ANOTHER EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (BASED UPON AN OPINION
OF COUNSEL IF THE COMPANY SO REQUESTS) OR (6) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL
APPLICABLE BLUE SKY LAWS OF THE STATES OF THE UNITED STATES, AND THE HOLDER OF
THIS SERIES A PREFERRED STOCK AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM
THIS SERIES A PREFERRED STOCK OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.]
B-1
EXHIBIT C
Global Share Schedule: (include if Security is issued as a global certificate)
SCHEDULE A
SCHEDULE OF EXCHANGES FOR GLOBAL SECURITY
The initial number of shares of Series A Preferred Stock represented by
this Global Preferred Share shall be ___________. The following exchanges of a
part of this Global Preferred Share have been made:
Amount of Decrease Number of Shares
in Number of Shares Amount of Increase in Represented by This
Represented by This Number of Shares Global Preferred Signature of
Global Preferred Represented by This Share Following Such Authorized Officer
Date of Exchange Share Global Preferred Share Decrease or Increase of Registrar
---------------- ------------------- ----------------------- -------------------- ------------------
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