Exhibit 4.6
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MUZAK LLC
and
MUZAK FINANCE CORP.,
as Issuers,
The GUARANTORS named herein
and
STATE STREET BANK AND TRUST COMPANY, as Trustee
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INDENTURE
Dated as of February 2, 2000
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Up to $50,000,000 aggregate principal amount of
Senior Subordinated Floating Rate Notes due 2009
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CROSS-REFERENCE TABLE
TIA Indenture
Section Section
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310(a)(1)....................................................................... 7.10
(a)(2)....................................................................... 7.10
(a)(3)....................................................................... N.A.
(a)(4)....................................................................... N.A.
(b).......................................................................... 7.08; 7.10; 12.02
(b)(1)....................................................................... 7.10
(b)(9)....................................................................... 7.10
(c).......................................................................... N.A.
311(a).......................................................................... 7.11
(b).......................................................................... 7.11
(c).......................................................................... N.A.
312(a).......................................................................... 2.05
(b).......................................................................... 10.03
(c).......................................................................... 10.03
313(a).......................................................................... 7.06
(b)(1)....................................................................... 7.06
(b)(2)....................................................................... 7.06
(c).......................................................................... 12.02
(d).......................................................................... 7.06
314(a).......................................................................... 4.02; 4.04; 12.02
(b).......................................................................... N.A.
(c)(1)....................................................................... 12.04; 12.05
(c)(2)....................................................................... 12.04; 12.05
(c)(3)....................................................................... N.A.
(d).......................................................................... N.A.
(e).......................................................................... 10.05
(f).......................................................................... N.A.
315(a).......................................................................... 7.01; 7.02
(b).......................................................................... 7.05; 10.02
(c).......................................................................... 7.01
(d).......................................................................... 6.05; 7.01; 7.02
(e).......................................................................... 6.11
316(a) (last sentence).......................................................... 12.06
(a)(1)(A).................................................................... 6.05
(a)(1)(B).................................................................... 6.04
(a)(2)....................................................................... 8.02
(b).......................................................................... 6.07
(c).......................................................................... 8.04
317(a)(1)....................................................................... 6.08
(a)(2)....................................................................... 6.09
(b).......................................................................... 7.12
318(a).......................................................................... 12.01
N.A. means Not Applicable
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NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of this Indenture.
TABLE OF CONTENTS
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ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.......................................................................1
Section 1.01. Other Definitions................................................................42
Section 1.02. Incorporation by Reference of
Trust Indenture Act...........................................................43
Section 1.03. Rules of Construction............................................................43
ARTICLE 2
THE NOTES
Section 2.01. Dating; Incorporation of Form in Indenture.......................................44
Section 2.02. Execution and Authentication.....................................................45
Section 2.03. Registrar, Paying Agent and Calculation Agent....................................46
Section 2.04. Paying Agent to Hold Money in Trust..............................................47
Section 2.05. Noteholder Lists.................................................................47
Section 2.06. Transfer and Exchange............................................................47
Section 2.07. Replacement Notes................................................................48
Section 2.08. Outstanding Notes................................................................49
Section 2.09. Temporary Notes..................................................................49
Section 2.10. Cancellation.....................................................................49
Section 2.11. Defaulted Interest...............................................................50
Section 2.12. Deposit of Moneys................................................................50
Section 2.13. CUSIP Number.....................................................................50
Section 2.14. Book-Entry Provisions for Global Notes...........................................51
Section 2.15. Registration of Transfers and Exchanges..........................................52
Section 2.16. Joint and Several Liability......................................................58
Section 2.17. Ranking of Notes and Guarantees Relative to Existing Notes and
Related Guarantees............................................................58
ARTICLE 3
REDEMPTION
Section 3.01. Notices to Trustee...............................................................58
Section 3.02. Selection by Trustee of Notes to Be Redeemed.....................................58
Section 3.03. Notice of Redemption.............................................................59
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Section 3.04. Effect of Notice of Redemption...................................................60
Section 3.05. Deposit of Redemption Price......................................................60
Section 3.06. Notes Redeemed in Part...........................................................61
Section 3.07. Redemption.......................................................................61
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.................................................................63
Section 4.02. Provision of Financial Statements and Other Information..........................63
Section 4.03. Waiver of Stay, Extension or Usury Laws..........................................64
Section 4.04. Compliance Certificate; Notice of Default; Tax Information.......................65
Section 4.05. Taxes............................................................................66
Section 4.06. Limitation on Additional Indebtedness............................................66
Section 4.07. Limitation on Restricted Payments................................................67
Section 4.08. Limitation on Other Senior Subordinated Indebtedness.............................71
Section 4.09. Limitation on Certain Asset Sales................................................72
Section 4.10. Limitation on Transactions with Affiliates.......................................76
Section 4.11. Limitations on Liens.............................................................78
Section 4.12. Limitations on Investments.......................................................79
Section 4.13. Limitation on Sale and Lease-Back Transactions...................................79
Section 4.14. Payments for Consent.............................................................79
Section 4.15. Corporate Existence..............................................................80
Section 4.16. Change of Control................................................................80
Section 4.17. Maintenance of Office or Agency..................................................83
Section 4.18. Limitation on Dividend and Other Payment Restrictions Affecting
Restricted Subsidiaries.......................................................83
Section 4.19. Limitation on Conduct of Business................................................86
Section 4.20. Compliance with Laws.............................................................86
Section 4.21. Limitation on Preferred Stock of Restricted Subsidiaries.........................86
Section 4.22. Limitation on Creation of Subsidiaries...........................................86
Section 4.23. Maintenance of Properties and Insurance..........................................87
Section 4.24. Pending ABRY Equity Contribution.................................................88
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ARTICLE 5
SUCCESSOR CORPORATION
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Section 5.01. Limitation on Consolidation Merger and Sale of Assets............................88
Section 5.02. Successor Person Substituted.....................................................89
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default................................................................90
Section 6.02. Acceleration.....................................................................92
Section 6.03. Other Remedies...................................................................93
Section 6.04. Waiver of Past Defaults and Events of Default....................................93
Section 6.05. Control by Majority..............................................................94
Section 6.06. Limitation on Suits..............................................................94
Section 6.07. Rights of Holders to Receive Payment.............................................95
Section 6.08. Collection Suit by Trustee.......................................................95
Section 6.09. Trustee May File Proofs of Claim.................................................95
Section 6.10. Priorities.......................................................................96
Section 6.11. Undertaking for Costs............................................................96
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee................................................................97
Section 7.02. Rights of Trustee................................................................99
Section 7.03. Individual Rights of Trustee....................................................100
Section 7.04. Trustee's Disclaimer............................................................100
Section 7.05. Notice of Defaults..............................................................100
Section 7.06. Reports by Trustee to Holders...................................................100
Section 7.07. Compensation and Indemnity......................................................101
Section 7.08. Replacement of Trustee..........................................................102
Section 7.09. Successor Trustee by Consolidation, Merger or Conversion........................103
Section 7.10. Eligibility; Disqualification...................................................103
Section 7.11. Preferential Collection of Claims Against Issuers...............................104
Section 7.12. Paying Agents...................................................................104
ARTICLE 8
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 8.01. Without Consent of Holders......................................................104
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Section 8.02. With Consent of Holders.........................................................105
Section 8.03. Compliance with Trust Indenture Act.............................................107
Section 8.04. Revocation and Effect of Consents...............................................107
Section 8.05. Notation on or Exchange of Notes................................................108
Section 8.06. Trustee to Sign Amendments, etc.................................................108
ARTICLE 9
DISCHARGE OF INDENTURE; DEFEASANCE
Section 9.01. Satisfaction and Discharge of Indenture.........................................108
Section 9.02. Legal Defeasance................................................................109
Section 9.03. Covenant Defeasance.............................................................110
Section 9.04. Conditions to Defeasance or Covenant Defeasance.................................110
Section 9.05. Deposited Money and U.S. Government Obligations to Be Held in Trust;
Other Miscellaneous Provisions...............................................113
Section 9.06. Reinstatement...................................................................114
Section 9.07. Moneys Held by Paying Agent.....................................................114
Section 9.08. Moneys Held by Trustee..........................................................115
ARTICLE 10
GUARANTEES
Section 10.01. Guarantees......................................................................115
Section 10.02. Limitation on Liability.........................................................117
Section 10.03. Successors and Assigns..........................................................118
Section 10.04. No Waiver.......................................................................118
Section 10.05. Modification....................................................................118
Section 10.06. Release of Guarantor............................................................119
Section 10.07. Execution of Supplemental Indenture for Future Guarantors.......................119
Section 10.08. Execution and Delivery of Guarantees............................................120
Section 10.09. Guarantee Obligations Subordinated to Guarantor Senior Indebtedness.............120
Section 10.10. Payment Over of Proceeds upon Dissolution, etc., of a Guarantor.................121
Section 10.11. Suspension of Guaranteed Obligations When Guarantor Senior
Indebtedness in Default......................................................123
Section 10.12. Subrogation to Rights of Holders of Guarantor Senior Indebtedness...............125
Section 10.13. Guarantee Subordination Provisions Solely to Define Relative Rights.............126
Section 10.14. Application of Certain Article 11 Provisions....................................127
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ARTICLE 11
SUBORDINATION OF NOTES
Section 11.01. Notes Subordinate to Senior Indebtedness........................................127
Section 11.02. Payment Over of Proceeds upon Dissolution, etc..................................128
Section 11.03. Suspension of Payment When Senior Indebtedness in Default.......................130
Section 11.04. Trustee's Relation to Senior Indebtedness.......................................132
Section 11.05. Subrogation of Rights of Holders of Senior Indebtedness.........................132
Section 11.06. Provisions Solely to Define Relative Rights.....................................133
Section 11.07. Trustee to Effectuate Subordination.............................................134
Section 11.08. No Waiver of Subordination Provisions...........................................134
Section 11.09. Notice to Trustee...............................................................135
Section 11.10. Reliance on Judicial Order or Certificate of Liquidating Agent..................136
Section 11.11. Rights of Trustee as a Holder of Senior Indebtedness; Preservation
of Trustee's Rights..........................................................137
Section 11.12. Article Applicable to Paying Agents.............................................137
Section 11.13. No Suspension of Remedies.......................................................137
Section 11.14. Acceleration of Payment of Notes................................................137
ARTICLE 12
MISCELLANEOUS
Section 12.01. Trust Indenture Act Controls....................................................138
Section 12.02. Notices.........................................................................138
Section 12.03. Communications by Holders with Other Holders....................................140
Section 12.04. Certificate and Opinion as to Conditions Precedent..............................140
Section 12.05. Statements Required in Certificate and Opinion..................................140
Section 12.06. When Treasury Notes Disregarded.................................................141
Section 12.07. Rules by Trustee and Agents.....................................................141
Section 12.08. Business Days; Legal Holidays...................................................141
Section 12.09. Governing Law...................................................................141
Section 12.10. No Adverse Interpretation of Other Agreements...................................142
Section 12.11. No Recourse Against Others......................................................142
Section 12.12. Successors......................................................................142
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Section 12.13. Multiple Counterparts...........................................................142
Section 12.14. Table of Contents, Headings, etc................................................142
Section 12.15. Separability....................................................................143
EXHIBITS
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Exhibit A. Form of Note............................................................................A-1
Exhibit B. Form of Legend for Global Notes.........................................................B-1
Exhibit C. Form of Certificate to Be Delivered in Connection with Transfers to Non-QIB
Accredited Investors....................................................................C-1
Exhibit D. Form of Certificate to Be Delivered in Connection with Transfers Pursuant
to Regulation S.........................................................................D-1
Exhibit E. Form of Guarantee.......................................................................E-1
Exhibit F. Form of Supplemental Indenture..........................................................F-1
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INDENTURE, dated as of February 2, 2000, among MUZAK LLC, a
Delaware limited liability company (the "Company"), MUZAK FINANCE CORP., a
Delaware corporation ("Finance Corp." and, together with the Company, the
"Issuers"), each of the Guarantors (as defined herein) and STATE STREET BANK AND
TRUST COMPANY, a Massachusetts banking corporation, as Trustee (the "Trustee").
Each party agrees as follows for the benefit of the other
parties and for the equal and ratable benefit of the Holders of the Issuers'
Senior Subordinated Floating Rate Notes due 2009.
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
"ABRY" means ABRY Partners, Inc., a Delaware corporation.
"ABRY Equity Contributions" means, collectively, the New ABRY
Equity Contribution and the Pending ABRY Equity Contribution.
"ABRY Management Agreement" means the Management Agreement
dated as of October 6, 1998, and as amended prior to the Issue Date, between
ABRY and the Company.
"ABRY Subordinated Debt" means Indebtedness of the Company in
principal amount not to exceed $30 million in the aggregate at any time
outstanding (a) that is owed to ABRY III, ABRY, MEM Holdings, Inc. or any other
investment fund controlled by ABRY, (b) as to which the payment of principal of
(and premium, if any) and interest and other payment obligations in respect of
such Indebtedness shall be subordinate to the prior payment in full of the
Company's Obligations under the Notes such that no payments of principal (or
premium, if any) or interest on or otherwise due in respect of such Indebtedness
may be permitted for so long as any Default or Event of Default shall have
occurred and be continuing, (c) that shall automatically convert into common
equity of Holdings within 18 months of the date of issuance thereof, unless
refinanced, and (d) the terms of which have been determined to be fair and
reasonable to the Company as determined in good faith by the Board
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of Directors of the Company and evidenced by a Board Resolution delivered to the
Trustee.
"ABRY II" means ABRY Broadcast Partners II, L.P., a Delaware
limited partnership.
"ABRY III" means ABRY Broadcast Partners III, L.P., a Delaware
limited partnership.
"Acquired Indebtedness" means Indebtedness of a Person
(including an Unrestricted Subsidiary) existing at the time such Person becomes
a Restricted Subsidiary or is merged into or consolidated with any other Person
or which is assumed in connection with the acquisition of assets from such
Person and, in each case, whether or not incurred by such Person in connection
with, or in anticipation or contemplation of, such Person becoming a Restricted
Subsidiary or such merger, consolidation or acquisition.
"Acquisition EBITDA" means, with respect to any Asset
Acquisition, (i) EBITDA attributable to the assets to be acquired in such Asset
Acquisition for the same fiscal quarter utilized in determining "Consolidated
Leverage Ratio" plus (ii) the projected, quantifiable cost reductions expected
to be realized and non-recurring costs and expenses, in each case, in connection
with such Asset Acquisition and as a result of, in the case of cost reductions,
an established program of cost reductions adopted in good faith by the Board of
Directors of the Company. For purposes of the foregoing, cost reductions and
non-recurring costs and expenses, in each case, shall be calculated on a pro
forma basis as if such cost reductions and non-recurring costs and expenses, in
each case, had been implemented at the beginning of such fiscal quarter. Prior
to the consummation of any transaction requiring the inclusion of Acquisition
EBITDA in the calculation of Consolidated Leverage Ratio, the Company shall
deliver to the Trustee an Officers' Certificate indicating the cost reductions
and non-recurring costs and expenses, in each case, taken into account in
determining Acquisition EBITDA and the assumptions underlying such cost
reductions and non-recurring costs and expenses.
"Additional Notes" means any Notes issued as pay-in-kind
interest on outstanding Notes pursuant to paragraph 1 of Exhibit A and
authenticated and delivered under this Indenture pursuant to Section 2.02 of
this Indenture.
"Adjusted Net Assets" of any Person at any date shall mean the
lesser of
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(1) the amount by which the fair salable value of the assets
of such Person at such date exceeds the total amount of liabilities,
including, without limitation, contingent liabilities (after giving
effect to all other fixed and contingent liabilities), but excluding
liabilities under the Guarantee of such Person at such date, and
(2) the amount by which the fair salable value of the assets
of such Person at such date exceeds the amount that will be required to
pay the probable liability of such Person on its debts (after giving
effect to all other fixed and contingent liabilities and after giving
effect to any collection from any Subsidiary of such Person in respect
of the obligations of such Person under the Guarantee of such Person),
excluding Indebtedness in respect of the Guarantee of such Person, as
they become absolute and matured.
"Affiliate" means, with respect to any specific Person, any
other Person that 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, for purposes of Section
4.10 of this Indenture, beneficial ownership of at least 10% of the voting
securities of a Person, either directly or indirectly, shall be deemed to be
control. Notwithstanding the foregoing, no Person (other than the Company or any
Subsidiary of the Company) in whom a Securitization Entity makes an Investment
in connection with a Qualified Securitization Transaction shall be deemed to be
an Affiliate of the Company or any of its Subsidiaries solely by reason of such
Investment.
"Agent" means any Registrar, Paying Agent, co-registrar,
Calculation Agent or agent for service of notices and demands.
"Asset Acquisition" means
(1) an Investment by the Company or any Restricted Subsidiary
of the Company in any other Person pursuant to which such Person shall
become a Restricted Subsidiary of the Company or any Restricted
Subsidiary of the Company,
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or shall be merged with or into the Company or any Restricted
Subsidiary of the Company or
(2) the acquisition by the Company or any Restricted
Subsidiary of the Company of the assets of any Person (other than a
Restricted Subsidiary of the Company) which constitute all or
substantially all of the assets of such Person or comprise any division
or line of business of such Person or any other Properties or assets of
such Person other than in the ordinary course of business.
"Asset Sale" means any direct or indirect sale, issuance,
conveyance, assignment, transfer, lease or other disposition (including any Sale
and Lease-Back Transaction), other than in the ordinary course of business or to
the Company or any of its Restricted Subsidiaries, in any single transaction or
series of related transactions of
(1) any Capital Stock of or other equity interest in any
Restricted Subsidiary of the Company or
(2) any other Property or assets of the Company or of any
Restricted Subsidiary thereof;
provided that Asset Sales shall not include
(1) a transaction or series of related transactions for which
the Company or its Restricted Subsidiaries receive aggregate
consideration of less than $1 million,
(2) the sale, lease, conveyance, disposition or other transfer
of all or substantially all of the assets of the Company as permitted
under Section 5.01 of this Indenture or any disposition that
constitutes a Change of Control,
(3) the sale or discount, in each case without recourse, of
accounts receivable arising in the ordinary course of business, but
only in connection with the compromise or collection thereof,
(4) the factoring of accounts receivable arising in the
ordinary course of business pursuant to customary arrangements,
(5) the licensing of intellectual property,
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(6) disposals or replacements of obsolete equipment in the
ordinary course of business,
(7) sales of accounts receivable, equipment and related assets
(including contract rights) of the type specified in the definition of
Qualified Securitization Transaction to a Securitization Entity for the
fair market value thereof, including cash in an amount at least equal
to 75% of the fair market value thereof as determined in accordance
with GAAP (for the purposes of this clause (7), Purchase Money Notes
shall be deemed to be cash),
(8) transfers of accounts receivable, equipment and related
assets (including contract rights) of the type specified in the
definition of Qualified Securitization Transaction (or a fractional
undivided interest therein) by a Securitization Entity in a Qualified
Securitization Transaction, and
(9) any transfer of assets acquired by the Company or any of
its Restricted Subsidiaries to an independent affiliate of the Company
or any of its Restricted Subsidiaries in accordance with the terms of
the License Agreements as such agreements are in effect on the Issue
Date and as the same may be amended or restated in a manner which is
not more disadvantageous to the Holders in any material respect than
the terms of such agreements as in effect on the Issue Date.
"Asset Sale Proceeds" means, with respect to any Asset Sale,
(1) cash and Cash Equivalents received by the Company or any
Restricted Subsidiary of the Company from such Asset Sale (including
cash and Cash Equivalent received as consideration for the assumption
of liabilities incurred in connection with or in anticipation of such
Asset Sale), after
(a) provision for all income or other taxes measured
by or resulting from such Asset Sale (after taking into
account any reduction in consolidated tax liability due to
available tax credits or deductions and any tax sharing
arrangements),
(b) payment of all brokerage commissions,
underwriting and other fees and expenses related to such Asset
Sale,
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(c) provision for minority interest holders in any
Restricted Subsidiary of the Company as a result of such Asset
Sale,
(d) repayment of Indebtedness that is secured by the
assets subject to such Asset Sale or otherwise required to be
repaid in connection with such Asset Sale and
(e) deduction of appropriate amounts to be provided
by the Company or a Restricted Subsidiary of the Company as a
reserve, in accordance with GAAP, against any liabilities
associated with the assets sold or disposed of in such Asset
Sale and retained by the Company or a Restricted Subsidiary
after such Asset Sale, including, without limitation, pension
and other post-employment benefit liabilities and liabilities
related to environmental matters or against any
indemnification obligations associated with the assets sold or
disposed of in such Asset Sale, and
(2) promissory notes and other noncash consideration received
by the Company or any Restricted Subsidiary of the Company from such
Asset Sale or other disposition upon the liquidation or conversion of
such notes or noncash consideration into cash or Cash Equivalents.
"Attributable Indebtedness" in respect of a Sale and
Lease-Back Transaction means, as at the time of determination, the greater of
(1) the fair value of the Property subject to such arrangement
and
(2) the present value of the notes (discounted at the rate of
interest implied in such transaction, determined in accordance with
GAAP) of the total obligations of the lessee for rental payments during
the remaining term of the lease included in such Sale and Lease-Back
Transaction (including any period for which such lease has been
extended).
"Available Asset Sale Proceeds" means, with respect to any
Asset Sale, the aggregate Asset Sale Proceeds from such Asset Sale that have not
been applied in accordance with clause (3)(a) or (3)(b), and that have not yet
been the basis for an Excess Proceeds Offer in accordance with clause (3)(c), of
Section 4.09(a) under this Indenture.
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"Bank Indebtedness" means (i) the Indebtedness outstanding or
arising under the Senior Credit Facility, (ii) all obligations incurred by or
owing to the holders of such Indebtedness or any agent or representative thereof
outstanding or arising under the Senior Credit Facility (including, but not
limited to, all premium, interest (including, but not limited to, interest
accruing pursuant to the terms of the Senior Credit Facility on or after the
filing of any petition in any bankruptcy, reorganization or similar proceeding
relating to the Company or any Restricted Subsidiary, whether or not a claim for
such is allowed in such proceeding), all fees and expenses of counsel,
reimbursement obligations, indemnities and all other charges, fees, expenses,
claims, and other amounts), and (iii) all interest rate agreement and hedging
obligations arising in connection therewith with any party to the Senior Credit
Facility or any of their affiliates.
"Board of Directors" means, with respect to any Person, the
board of directors of such Person (or, if such Person is a limited liability
company, the board of managers of such company) or similar governing body or any
duly authorized committee thereof.
"Board Resolution" means with respect to any Person, a copy of
a resolution certified by the Secretary or an Assistant Secretary of such Person
to have been duly adopted by the Board of Directors of such Person and to be in
full force and effect on the date of such certification.
"Calculation Agent" means the Person appointed by the Company
to calculate the interest rate on the Notes. The Calculation Agent shall
initially be the Trustee.
"Capital Stock" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated and
whether or not voting) of corporate stock, partnership or limited liability
company interests or any other participation, right or other interest in the
nature of an equity interest in such Person including, without limitation,
Common Stock and Preferred Stock of such Person, or any option, warrant or other
security convertible into any of the foregoing.
"Capitalized Lease Obligation" means with respect to any
Person, Indebtedness represented by obligations under a lease that is required
to be capitalized for financial reporting purposes in accordance with GAAP, and
the amount of such
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Indebtedness shall be the capitalized amount of such obligations determined in
accordance with GAAP.
"Capstar Acquisition" means the acquisition by Holdings of
certain Muzak franchises from Capstar Broadcasting Corporation pursuant to a
Contribution Agreement between Holdings and Capstar Broadcasting Corporation,
dated February 19, 1999, and the subsequent transfer of such assets to the
Company in exchange for equity interests in the Company.
"Cash Equivalents" means
(1) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued
by any agency or instrumentality thereof and backed by the full faith
and credit of the United States, in each case maturing within one year
from the date of acquisition thereof;
(2) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state
or any public instrumentality thereof maturing within one year from the
date of acquisition thereof and, at the time of acquisition, having one
of the two highest ratings obtainable from either S&P or Moody's;
(3) commercial paper maturing no more than one year from the
date of creation thereof and, at the time of acquisition, having a
rating of at least A-1 from S&P or at least P-1 from Moody's;
(4) certificates of deposit or bankers' acceptances maturing
within one year from the date of acquisition thereof issued by (i) any
bank organized under the laws of the United States of America or any
state thereof or the District of Columbia or any U.S. branch of a
foreign bank having at the date of acquisition thereof combined capital
and surplus of not less than $250,000,000 or (ii) Brown Brothers
Harriman;
(5) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clause (1)
above entered into with any bank meeting the qualifications specified
in clause (4) above; and
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(6) investments in money market funds which invest
substantially all their assets in securities of the types described in
clauses (1) through (5) above.
A "Change of Control" of the Company will be deemed to have
occurred at such time as
(1) any Person or group of related Persons for purposes of
Section 13(d) of the Exchange Act (a "Group"), other than a Permitted
Holder, becomes the beneficial owner (as defined in Rule under Rule
13d-3 or any successor rule or regulation promulgated under the
Exchange Act, except that a Person shall be deemed to have "beneficial
ownership" of all securities that such Person has the right to acquire,
whether such right is exercisable immediately or only after the passage
of time) of more than 35% of the total voting power of the Company's
Capital Stock, and the Permitted Holders beneficially do not own, in
the aggregate, a greater percentage of the total voting power of the
Capital Stock of the Company than such other Person or Group and do not
have the right or ability by voting power, contract or otherwise to
elect or designate for election a majority of the Board of Directors of
the Company,
(2) there shall be consummated any consolidation or merger of
the Company in which the Company is not the continuing or surviving
Person or pursuant to which the Common Stock of the Company would be
converted into cash, securities or other Property, other than a merger
or consolidation of the Company in which the holders of the Capital
Stock of the Company outstanding immediately prior to the consolidation
or merger hold, directly or indirectly, at least a majority of the
Capital Stock of the surviving corporation immediately after such
consolidation or merger,
(3) during any period of two consecutive years, individuals
who at the beginning of such period constituted the Board of Directors
of the Company (together with any new Directors whose election by such
Board of Directors or whose nomination for election by the
equityholders of the Company has been approved by 66 2/3% of the
Directors then still in office who either were Directors at the
beginning of such period or whose election or recommendation for
election was previously so approved) cease to constitute a majority of
the Board of Directors of the Company or
-10-
(4) the approval by the holders of Capital Stock of the
Company of any plan or proposal for the liquidation or dissolution of
the Company (whether or not otherwise in compliance with the provisions
of this Indenture).
"Commission" means the United States Securities and Exchange
Commission.
"Common Stock" of any Person means all Capital Stock of such
Person that is generally entitled to
(1) vote in the election of directors of such Person or
(2) if such Person is not a corporation, vote or otherwise
participate in the selection of the governing body, partners, managers
or others that will control the management and policies of such Person.
"Company" means the party named as such in the first paragraph
of this Indenture until a successor replaces such party pursuant to Article 5 of
this Indenture and thereafter means the successor.
"Consolidated Interest Expense" means, with respect to any
Person, for any period, the aggregate amount of interest which, in conformity
with GAAP, would be set forth opposite the caption "interest expense" or any
like caption on an income statement for such Person and its Restricted
Subsidiaries on a consolidated basis including, but not limited to,
(1) Redeemable Dividends, whether paid or accrued, on
Preferred Stock,
(2) imputed interest included in Capitalized Lease
Obligations,
(3) all commissions, discounts and other fees and charges owed
with respect to letters of credit and bankers' acceptance financing,
(4) the net costs associated with Hedging Obligations,
(5) amortization of other financing fees and expenses,
-11-
(6) the interest portion of any deferred payment obligation,
(7) amortization of discount or premium, if any, and
(8) all other noncash interest expense (other than interest
amortized to cost of sales)
plus, without duplication,
(1) all net capitalized interest for such period,
(2) all interest incurred or paid under any guarantee of
Indebtedness (including a guarantee of principal, interest or any
combination thereof) of any Person, and
(3) the amount of all dividends or distributions paid on
Disqualified Capital Stock (other than dividends paid or payable in
shares of Capital Stock of the Company that does not constitute
Disqualified Capital Stock).
"Consolidated Leverage Ratio" means, with respect to any
Person, the ratio of
(1) the sum of the aggregate outstanding amount of
Indebtedness of such Person and its Restricted Subsidiaries and
Preferred Stock of any such Restricted Subsidiary issued in accordance
with Section 4.21 of this Indenture as of the date of calculation (the
"Transaction Date") on a consolidated basis determined in accordance
with GAAP to
(2) the product of (a) such Person's EBITDA for the full
fiscal quarter (the "One Quarter Period") ending on or prior to the
date of determination for which financial statements are available and
(b) four.
For purposes of this definition, clauses (1) and (2) above shall be calculated
after giving effect on a pro forma basis to:
(a) the incurrence or repayment of any Indebtedness of such
Person or any of its Restricted Subsidiaries or the issuance or
redemption or other repayment of Preferred Stock of any such Restricted
Subsidiary (and the application of the proceeds thereof) giving rise to
the need to make such calculation and any incurrence or repayment of
other Indebtedness and, in the case of any Restricted Subsidiary, the
issuance or redemption or other repayment of
-12-
Preferred Stock (and the application of the proceeds thereof), other
than the incurrence or repayment of Indebtedness in the ordinary course
of business for working capital purposes pursuant to working capital
facilities, occurring during the One Quarter Period or at any time
subsequent to the last day of the One Quarter Period and on or prior to
the Transaction Date, as if such incurrence or repayment or issuance or
redemption or other repayment, as the case may be (and the application
of the proceeds thereof), occurred on the first day of the One Quarter
Period; and
(b) any Asset Sales or Asset Acquisitions occurring during the
One Quarter Period or at any time subsequent to the last day of the One
Quarter Period and on or prior to the Transaction Date, as if such
Asset Sale or Asset Acquisition (including the incurrence, assumption
or liability for any Acquired Indebtedness) occurred on the first day
of the One Quarter Period as follows:
(x) with respect to Asset Sales, the EBITDA
attributable to the assets which are the subject of Asset
Sales that occurred shall be excluded; and
(y) with respect to Asset Acquisitions, the
Acquisition EBITDA attributable to the assets which are the
subject of the applicable Asset Acquisition shall be included.
If such Person or any of its Restricted Subsidiaries directly or indirectly
guarantees Indebtedness of a third Person, the preceding paragraph shall give
effect to the incurrence of such guaranteed Indebtedness as if such Person or
any Restricted Subsidiary of such Person had directly incurred or otherwise
assumed such guaranteed Indebtedness.
"Consolidated Net Income" means, with respect to any Person,
for any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; provided, however, that
(1) the Net Income of any Person other than a Restricted
Subsidiary of the referent Person shall be included only to the extent
of the amount of dividends or distributions paid to the referent Person
or a Restricted Subsidiary of such referent Person,
-13-
(2) the Net Income of any Restricted Subsidiary of the Person
in question that is subject to any restriction or limitation on the
payment of dividends or the making of other distributions shall be
excluded to the extent of such restriction or limitation,
(3) 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,
(4) any net gain or loss (in the case of any net loss, only to
the extent that such determination of Consolidated Net Income is being
made in connection with the determination of amounts available for
Restricted Payments pursuant to the provisions described under Section
4.07 of this Indenture) resulting from an Asset Sale by the Person in
question or any of its Restricted Subsidiaries other than in the
ordinary course of business shall be excluded,
(5) extraordinary gains and losses shall be excluded,
(6) income or loss attributable to discontinued operations
(including, without limitation, operations disposed of during such
period whether or not such operations were classified as discontinued)
shall be excluded and
(7) in the case of a successor to the referent Person by
consolidation or merger or as a transferee of the referent Person's
assets, any earnings of the successor corporation prior to such
consolidation, merger or transfer of assets shall be excluded.
"Control Investment Affiliate" means, as to any Person, any
other Person which (a) is an Affiliate of such Person and (b) is organized by
such Person primarily for the purpose of making equity or debt investments in
one or more companies.
"Corporate Trust Office" means the office of the Trustee at
which at any particular time its corporate trust business shall be principally
administered, which office at the date of execution of this Indenture is located
at 225 Franklin Street, Boston, Massachusetts 02110.
"Cumulative Consolidated Interest Expense" means, with respect
to any Person, as of any date of determination, Consolidated Interest Expense
from April 1, 1999 to the end of
-14-
such Person's most recently ended full fiscal quarter prior to such date, taken
as a single accounting period.
"Cumulative EBITDA" means, with respect to any Person, as of
any date of determination, EBITDA from April 1, 1999 to the end of such Person's
most recently ended full fiscal quarter prior to such date, taken as a single
accounting period.
"Default" means any event that is, or after notice or passage
of time or both would be, an Event of Default.
"Depository" means, with respect to the Notes issued in the
form of one or more Global Notes, The Depository Trust Company or another Person
designated as Depository by the Company, which Person must be a clearing agency
registered under the Exchange Act.
"Designated Senior Indebtedness," as to the Company or any
Guarantor, as the case may be, means
(1) any Bank Indebtedness and
(2) any other Senior Indebtedness or Guarantor Senior
Indebtedness, as the case may be, which at the time of determination
exceeds $25 million in aggregate principal amount (or accreted value in
the case of Indebtedness issued at a discount) outstanding or available
under a committed facility, which is specifically designated in the
instrument evidencing such Senior Indebtedness as "Designated Senior
Indebtedness" by such Person and as to which the Trustee has been given
written notice of such designation.
"Director" means, with respect to any Person, a member of the
Board of Directors of such Person (or, if such Person is a limited liability
company, a member of the board of managers of such Person).
"Disqualified Capital Stock" means any Capital Stock of a
Person or a Restricted Subsidiary thereof which, by its terms (or by the terms
of any security into which it is convertible or for which it is exchangeable at
the option of the holder), or upon the happening of any event, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
is redeemable at the option of the holder thereof, in whole or in part, on or
prior to the maturity date of the Notes. Without limitation of the foregoing,
Disquali-
-15-
fied Capital Stock shall be deemed to include any Preferred Stock of a Person or
a Restricted Subsidiary of such Person, with respect to either of which, under
the terms of such Preferred Stock, by agreement or otherwise, such Person or
Restricted Subsidiary is obligated to pay current dividends or distributions in
cash during the period prior to the maturity date of the Notes; provided,
however, that Preferred Stock of a Person or any Restricted Subsidiary thereof
that is issued with the benefit of provisions requiring a change of control
offer or asset sale offer to be made for such Preferred Stock in the event of a
change of control of such Person or Restricted Subsidiary or the sale of any
assets of such Person or Restricted Subsidiary which provisions have
substantially the same effect as the provisions described under Sections 4.16
and 4.09 of this Indenture, respectively, shall not be deemed to be Disqualified
Capital Stock solely by virtue of such provisions.
"EBITDA" means, with respect to any Person and its Restricted
Subsidiaries, for any period, an amount equal to
(1) the sum of
(a) Consolidated Net Income for such period, plus
(b) the provision for taxes for such period based on
income or profits to the extent such income or profits were
included in computing Consolidated Net Income and any
provision for taxes utilized in computing net loss under
clause (a) hereof, plus
(c) Consolidated Interest Expense for such period,
plus
(d) depreciation for such period on a consolidated
basis, plus
(e) amortization of intangibles for such period (but
excluding any noncash item to the extent it represents the
amortization of a prepaid cash expense that was paid in any
prior period) on a consolidated basis, plus
(f) any other noncash items reducing Consolidated Net
Income for such period except for any noncash items that
represent accruals of, or reserves for, cash disbursements to
be made in any future accounting period, minus
-16-
(2) all noncash items increasing Consolidated Net Income
(other than any noncash items representing deferred revenue to the
extent that such revenue was not included in Consolidated Net Income in
any prior period) for such period, all for such Person and its
Restricted Subsidiaries determined on a consolidated basis in
accordance with GAAP;
provided, however, that, for purposes of calculating EBITDA during any fiscal
quarter, cash income from a particular Investment (other than a Restricted
Subsidiary) of such Person shall be included only
(1) if cash income has been received by such Person with
respect to such Investment during each of the previous four fiscal
quarters, or
(2) if the cash income derived from such Investment is
attributable to Cash Equivalents.
"Electro Systems" means Electro Systems Corporation, a Florida
corporation.
"Electro Systems Acquisition" means the acquisition of Electro
Systems pursuant to a Stock Purchase Agreement dated as of February 18, 1999
between the Company and Carolina Georgia Sound, Inc.
"Equity Offering" means any public or private sale of Common
Stock (other than Disqualified Capital Stock) of the Company or Holdings
pursuant to which the Company or Holdings, as the case may be, receives net
proceeds of at least $20 million; provided, however, that in the case of an
Equity Offering by Holdings, Holdings shall have contributed to the capital of
the Company the portion of the Net Proceeds necessary to redeem the Notes
pursuant to Section 3.07(b) of this Indenture.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended and the rules and regulations of the Commission promulgated thereunder.
"Existing Notes" means the 9 7/8% Senior Subordinated Notes
due 2009 of the Issuers issued pursuant to an indenture dated as of March 18,
1999 by and among the Issuers, the Guarantors and the Trustee.
"Existing Notes Issue Date" means March 18, 1999.
-17-
"fair market value" means, with respect to any asset or
Property, the price which could be negotiated in an arm's-length, free market
transaction, for cash, between a willing seller and a willing and able buyer,
neither of whom is under undue pressure or compulsion to complete the
transaction. Fair market value shall be determined by the Board of Directors of
the Company acting reasonably and in good faith and shall be evidenced by a
Board Resolution of the Company delivered to the Trustee.
"Finance Corp." means the party named as such in the first
paragraph of this Indenture until a successor replaces such party pursuant to
Article 5 of this Indenture and thereafter means the successor.
"Foreign Restricted Subsidiary" means any Restricted
Subsidiary of the Company that is not organized under the laws of the United
States or any State thereof or the District of Columbia.
"GAAP" means generally accepted accounting principles
consistently applied as in effect in the United States from time to time.
"Guarantee" means any guarantee of the obligations of the
Issuers under this Indenture and the Notes by Holdings and any Restricted
Subsidiary in accordance with the provisions of this Indenture. When used as a
verb, "Guarantee" shall have a corresponding meaning.
"Guarantor" means each of Holdings and each Restricted
Subsidiary of the Company which Guarantees the Notes pursuant to the terms of
this Indenture; provided that upon the release and discharge of such Restricted
Subsidiary from its Guarantee in accordance with the terms of this Indenture,
such Restricted Subsidiary shall cease to be a Guarantor.
"Guarantor Senior Indebtedness" means (1) all Bank
Indebtedness of any Guarantor and (2) all principal of and premium, if any, and
interest (including, but not limited to, interest accruing on or after the
filing of any petition in any bankruptcy, reorganization or similar proceeding
relating to any Guarantor, whether or not a claim for such is allowed in such
proceeding) on, and any and all other fees, fees and expenses of counsel,
expense reimbursement obligations, indemnities and other amounts due pursuant to
the terms of all agreements, indentures, documents and instruments providing
for,
-18-
creating, securing or evidencing or otherwise entered into in connection with
(a) all obligations of any Guarantor with respect to any
Hedging Obligations,
(b) all obligations of any Guarantor to reimburse any bank or
other person in respect of amounts paid under letters of credit,
acceptances or other similar instruments,
(c) all other Indebtedness of any Guarantor which does not
provide that it is to rank pari passu with or subordinate to the
Guarantee of such Guarantor, and
(d) all deferrals, renewals, extensions and refundings of, and
amendments, modifications and supplements to, any of the Guarantor
Senior Indebtedness described above,
in each case, whether outstanding on the Issue Date or created thereafter.
Notwithstanding anything to the contrary in the foregoing, Guarantor Senior
Indebtedness will not include
(1) Indebtedness of any Guarantor to any of its Subsidiaries,
or to any Affiliate of such Guarantor or any of such Affiliate's
Subsidiaries,
(2) Indebtedness represented by (a) the Guarantees and (b) the
guarantees of the Existing Notes,
(3) any Indebtedness which by the express terms of the
agreement or instrument creating, evidencing or governing the same is
junior or subordinate in right of payment to any item of Guarantor
Senior Indebtedness,
(4) any trade payable arising from the purchase of goods or
materials or for services obtained in the ordinary course of business,
(5) Indebtedness incurred in violation of this Indenture,
(6) Indebtedness represented by Disqualified Capital Stock and
(7) any Indebtedness to or guaranteed on behalf of, any
shareholders, Director, officer or employee of the
-19-
Company or any Guarantor or any Subsidiary of the Company or such
Guarantor.
"Hedging Obligations" means, with respect to any Person, the
net payment obligations of such Person under (a) interest rate swap agreements,
interest rate cap agreements and interest rate collar agreements and (b) other
agreements or arrangements entered into in order to protect such Person against
fluctuations in commodity prices, interest rates or currency exchange rates.
"Holder" or "Noteholder" means the Person in whose name a Note
is registered on the Registrar's books.
"Holdings" means Muzak Holdings LLC, a Delaware limited
liability company, until a successor replaces such party pursuant to this
Indenture and thereafter means the successor.
"incur" means, with respect to any Indebtedness or other
obligation of any Person, to create, issue, incur (by conversion, exchange or
otherwise), assume, guarantee or otherwise become liable in respect of such
Indebtedness or other obligation or the recording, as required pursuant to GAAP
or otherwise, of any such Indebtedness or other obligation on the balance sheet
of such Person (and "incurrence," "incurred," "incurrable," and "incurring"
shall have meanings correlative to the foregoing); provided that a change in
GAAP that results in an obligation of such Person that exists at such time
becoming Indebtedness shall not be deemed an incurrence of such Indebtedness.
"Indebtedness" means (without duplication), with respect to
any Person, any indebtedness at any time outstanding, secured or unsecured,
contingent or otherwise, which is for borrowed money (whether or not the
recourse of the lender is to the whole of the assets of such Person or only to a
portion thereof), or evidenced by bonds, notes, debentures or similar
instruments or representing the balance deferred and unpaid of the purchase
price of any Property (excluding, without limitation, any balances that
constitute accounts payable or trade payables, and other accrued liabilities
arising in the ordinary course of business) if and to the extent any of the
foregoing indebtedness would appear as a liability upon a balance sheet of such
Person prepared in accordance with GAAP, and shall also include, to the extent
not otherwise included
(1) any Capitalized Lease Obligations of such Person,
-20-
(2) obligations secured by a lien to which the Property or
assets owned or held by such Person is subject, whether or not the
obligation or obligations secured thereby shall have been assumed,
(3) guarantees of items of other Persons which would be
included within this definition for such other Persons (whether or not
such items would appear upon the balance sheet of the guarantor),
(4) all obligations for the reimbursement of any obligor on
any letter of credit, banker's acceptance or similar credit
transaction,
(5) Disqualified Capital Stock of such Person or any
Restricted Subsidiary thereof, and
(6) hedging obligations of any such Person (if and to the
extent such hedging obligations would appear as a liability upon a
balance sheet of such Person prepared in accordance with GAAP).
The amount of Indebtedness of any Person at any date shall be the outstanding
balance at such date of all unconditional obligations as described above and,
with respect to contingent obligations, the maximum liability upon the
occurrence of the contingency giving rise to the obligation; provided that
(1) the amount outstanding at any time of any Indebtedness
issued with original issue discount is the principal amount of such
Indebtedness less the remaining unamortized portion of the original
issue discount of such Indebtedness at such time as determined in
conformity with GAAP,
(2) Indebtedness shall not include any liability for federal,
state, local or other taxes,
(3) the amount of Indebtedness of a Person which is without
recourse to any Property or assets of such Person except to the extent
of any Lien on Property or assets of such Person which secures such
Indebtedness shall be the lesser of the principal amount of such
Indebtedness and the fair market value of the Property or assets
subject to the Lien, and
(4) the amount of Indebtedness represented by Disqualified
Capital Stock shall be the greater of its volun-
-21-
tary or involuntary liquidation preference and its maximum fixed
repurchase price, but excluding accrued dividends, if any.
The "maximum fixed repurchase price" of any Disqualified
Capital Stock which does not have a fixed repurchase price shall be calculated
in accordance with the terms of such Disqualified Capital Stock as if such
Disqualified Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to this Indenture, and if such price
is based upon, or measured by, the fair market value of such Disqualified
Capital Stock, such fair market value shall be determined reasonably and in good
faith by the Board of Directors of the issuer of such Disqualified Capital
Stock.
Notwithstanding any other provision of the foregoing
definition, any trade payable arising from the purchase of goods or materials or
for services obtained in the ordinary course of business shall not be deemed to
be "Indebtedness" of the Company or any of its Restricted Subsidiaries for
purposes of this definition. Furthermore, guarantees of (or obligations with
respect to letters of credit supporting) Indebtedness otherwise included in the
determination of such amount shall not also be included.
"Indenture" means this Indenture as amended, restated or
supplemented from time to time.
"Independent Financial Advisor" means an investment banking
firm of national reputation in the United States
(1) which does not, and whose directors, officers and
employees or Affiliates do not, have a direct or indirect financial
interest in the Company and
(2) which, in the judgment of the Board of Directors of the
Company, is otherwise independent and qualified to perform the task for
which it is to be engaged.
"Initial Notes" means the Senior Subordinated Floating Rate
Notes due 2009 issued on the Issue Date and authenticated and delivered under
this Indenture pursuant to Section 2.02 of this Indenture.
"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.
-22-
"Interest Payment Date" means the stated maturity of an
installment of interest on the Notes.
"Investments" means, with respect of any Person, directly or
indirectly, any advance, account receivable (other than advances and accounts
receivable arising in the ordinary course of business of such Person), loan or
capital contribution to (by means of transfers of Property to others, payments
for Property or services for the account or use of others or otherwise), the
purchase of any Capital Stock, bonds, notes, debentures, partnership or joint
venture interests or other securities of, the acquisition, by purchase or
otherwise, of all or substantially all of the business or assets or stock or
other evidence of beneficial ownership of, any Person or the making of any
investment in any Person. Investments shall exclude
(1) extensions of trade credit on commercially reasonable
terms in accordance with normal trade practices of such Person and
(2) the repurchase of securities of any Person by such Person.
If the Company or any Restricted Subsidiary of the Company
sells or otherwise disposes of any Capital Stock of any direct or indirect
Restricted Subsidiary of the Company such that such Restricted Subsidiary would
no longer constitute a Subsidiary, 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 Capital Stock of such Restricted Subsidiary not sold or disposed
of.
"Issue Date" means February 2, 2000.
"Issuers" means each party named as such in the first
paragraph of this Indenture until a successor replaces such party pursuant to
Article 5 of this Indenture and thereafter means the successor.
"License Agreements" means the License Agreements between the
Company and its independent affiliates.
"Lien" means, with respect to any Property or assets of any
Person, any mortgage or deed of trust, pledge, hypothecation, assignment,
deposit arrangement, security interest, lien, charge, easement, encumbrance,
preference, priority, or other security agreement or preferential arrangement of
any
-23-
kind or nature whatsoever on or with respect to such Property or assets
(including without limitation, any Capitalized Lease Obligation, conditional
sales, or other title retention agreement having substantially the same economic
effect as any of the foregoing).
"Maturity Date" means March 15, 2009.
"Moody's" means Moody's Investors Service, Inc. and its
successors.
"Net Income" means, with respect to any Person for any period,
the net income (loss) of such Person determined in accordance with GAAP.
"New ABRY Equity Contribution" means the contribution of $4.3
million in cash made to the common equity capital of the Company by certain of
its existing stockholders on February 1, 2000.
"Non-Payment Event of Default" means any event (other than a
Payment Default) the occurrence of which entitles one or more Persons to
accelerate the maturity of any Designated Senior Indebtedness.
"Non-U.S. Person" means a person who is not a U.S. person, as
defined in Regulation S.
"Notes" means (i) the Initial Notes, (ii) any other Senior
Subordinated Floating Rate Notes due 2009 issued after the Issue Date in
accordance with Section 2.02 of this Indenture and (iii) any Additional Notes
issued in accordance with the terms of this Indenture, in all cases, treated as
a single class of securities and any notes issued in exchange therefor as
contemplated hereunder.
"Obligations" means all obligations for principal, premium,
interest, penalties, charges, fees, fees and expenses of counsel, indemnities,
reimbursement obligations, damages, claims and other liabilities payable under
the documentation governing any Indebtedness.
"Officer" means, with respect to any Person, the Chief
Executive Officer, the Chief Financial Officer, Treasurer or the President, of
such Person.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chief Executive Officer,
-24-
the President or any Vice President and the Chief Financial Officer or any
Treasurer of such Person that shall comply with applicable provisions of this
Indenture.
"Opinion of Counsel" means a written opinion from legal
counsel who and which is reasonably acceptable to the Trustee complying with the
requirements of this Indenture. Such legal counsel shall be outside counsel and
not an employee of or in-house counsel to the Company.
"Payment Default" means any default, whether or not any
requirement for the giving of notice, the lapse of time or both, or any other
condition to such default becoming an event of default has occurred, in the
payment of principal of or premium, if any, or interest on or any other amount
payable in connection with Designated Senior Indebtedness.
"Pending ABRY Equity Contribution" means the contribution of
not less than $6.3 million in cash made to the common equity capital of the
Company by certain of its existing stockholders which is to occur after the
Issue Date, but on or before February 10, 2000.
"Permitted Asset Swap" means, with respect to any Person, the
substantially concurrent exchange of assets of such Person for assets of another
Person which are useful to the business of such aforementioned Person.
"Permitted Holders" means each of ABRY III, ABRY II and each
Control Investment Affiliate of ABRY III or ABRY II.
"Permitted Indebtedness" means:
(1) Indebtedness of the Company or any Restricted Subsidiary
arising under or in connection with the Senior Credit Facility in an
aggregate principal amount not to exceed $200 million outstanding at
any time less (i) any mandatory prepayment actually made thereunder (to
the extent, in the case of payments of revolving credit borrowings,
that the corresponding commitments have been permanently reduced) or
scheduled payments actually made thereunder and (ii) the aggregate
amount of Indebtedness of Securitization Entities in Qualified
Securitization Transactions (other than Qualified Securitization
Transactions involving equipment and related assets);
(2) Indebtedness under (a) the Existing Notes and the related
guarantees outstanding on the Issue Date in an
-25-
aggregate principal amount not to exceed $115 million and (b) the Notes
and the Guarantees;
(3) Indebtedness not covered by any other clause of this
definition which is outstanding on the Issue Date;
(4) Indebtedness of the Company to any Guarantor or to any
Wholly Owned Subsidiary that is not a Guarantor and Indebtedness of any
Restricted Subsidiary to the Company or to any Guarantor or to any
Wholly Owned Subsidiary that is not a Guarantor;
(5) Purchase Money Indebtedness that does not in the aggregate
exceed 5% of the Company's consolidated total assets;
(6) the incurrence by the Company or any Restricted Subsidiary
of Hedging Obligations that are incurred in the ordinary course of
business of the Company or such Restricted Subsidiary and not for
speculative purposes; provided that, in the case of any Hedging
Obligation that relates to (i) interest rate risk, the notional
principal amount of such Hedging Obligation does not exceed the
principal amount of the Indebtedness to which such Hedging Obligation
related and (ii) currency risk, such Hedging Obligation does not
increase the Indebtedness of the Company and its Restricted
Subsidiaries outstanding other than as a result of fluctuations in
foreign currency exchange rates or by reason of fees, indemnities and
compensation payable thereunder;
(7) Refinancing Indebtedness;
(8) Indebtedness of Foreign Restricted Subsidiaries of the
Company in an aggregate principal amount not to exceed $10 million at
any one time outstanding; provided the aggregate amount then
outstanding under this clause (8) when added to the aggregate amount
then outstanding under clause (1) above shall not exceed the aggregate
amount permitted under clause (1) above;
(9) guarantees by the Company and its Restricted Subsidiaries
of each other's Indebtedness; provided that such Indebtedness is
permitted to be incurred under this Indenture;
(10) Indebtedness incurred by the Company or any of its
Restricted Subsidiaries constituting reimbursement ob-
-26-
ligations with respect to letters of credit issued in the ordinary
course of business, including, without limitation, letters of credit in
respect of workers' compensation claims or self-insurance, or other
Indebtedness with respect to reimbursement type obligations regarding
workers' compensation claims;
(11) Indebtedness arising from agreements of the Company or a
Restricted Subsidiary of the Company providing for indemnification,
adjustment of purchase price, earn out or other similar obligations, in
each case, incurred or assumed in connection with the acquisition or
disposition of any business, assets or a Restricted Subsidiary of the
Company, other than guarantees of Indebtedness incurred by any Person
acquiring all or any portion of such business, assets or Restricted
Subsidiary for the purpose of financing such acquisition; provided
that, in the case of a disposition, the maximum assumable liability in
respect of all such Indebtedness shall at no time exceed the gross
proceeds actually received by the Company and its Restricted
Subsidiaries in connection with such disposition;
(12) obligations in respect of performance and surety bonds
and completion guarantees provided by the Company or any Restricted
Subsidiary of the Company in the ordinary course of business;
(13) the ABRY Subordinated Debt;
(14) the incurrence by a Securitization Entity of Indebtedness
in a Qualified Securitization Transaction that is not recourse to the
Company or any Subsidiary of the Company (except for Standard
Securitization Undertakings);
(15) Indebtedness of the Company issued to current or former
members of management of the Company or any of its Restricted
Subsidiaries to finance the repurchase, redemption or other acquisition
of Capital Stock of Holdings pursuant to clause (6) of Section 4.07(b)
of this Indenture; and
(16) additional Indebtedness of the Company and its Restricted
Subsidiaries not to exceed $5 million in aggregate principal amount at
any one time outstanding.
"Permitted Investments" means
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(1) Investments by the Company or by a Restricted Subsidiary
thereof, in the Company, a Guarantor or a Wholly Owned Subsidiary that
is not a Guarantor;
(2) Investments by the Company, or by a Restricted Subsidiary
thereof, in a Person, if as a result of such Investment
(a) such Person becomes a Guarantor or a Wholly Owned
Subsidiary that is not a Guarantor or
(b) such Person is merged, consolidated or
amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into, the
Company, a Guarantor or a Wholly Owned Subsidiary that is not
a Guarantor;
(3) Investments in cash and Cash Equivalents;
(4) reasonable and customary loans and advances made to
employees in the ordinary course of business;
(5) an Investment that is made by the Company or a Restricted
Subsidiary thereof in the form of any Capital Stock, bonds, notes,
debentures, partnership or joint venture interests or other securities
that are issued by a third party to the Company or such Restricted
Subsidiary solely as partial consideration for the consummation of an
Asset Sale that is otherwise permitted under Section 4.09 of this
Indenture;
(6) Hedging Obligations entered into in the ordinary course of
the Company's or its Restricted Subsidiaries' business and not for
speculative purposes;
(7) any acquisition of assets to be used in the business of
the Company or any of its Restricted Subsidiaries solely in exchange
for the issuance of Capital Stock (other than Disqualified Capital
Stock) of the Company;
(8) additional Investments not to exceed $5 million at any one
time outstanding;
(9) Investments existing on the Issue Date;
(10) Investments in securities of trade creditors or customers
received pursuant to any plan of reorganization
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or similar arrangement upon the bankruptcy or insolvency of such trade
creditors or customers;
(11) guarantees by the Company or any Restricted Subsidiary of
Indebtedness otherwise permitted to be incurred by Restricted
Subsidiaries of the Company under this Indenture; and
(12) any Investment by the Company or a Restricted Subsidiary
of the Company in a Securitization Entity or any Investment by a
Securitization Entity in any other Person in connection with a
Qualified Securitization Transaction; provided that any Investment in a
Securitization Entity is in the form of a Purchase Money Note or an
equity interest.
"Permitted Liens" means
(1) Liens on Property or assets of, or any shares of Capital
Stock of or secured indebtedness of, any Person existing at the time
such Person becomes a Restricted Subsidiary of the Company or at the
time such Person is merged into the Company or any of its Restricted
Subsidiaries; provided that such Liens are not incurred in connection
with, or in contemplation of, such Person becoming a Restricted
Subsidiary of the Company or merging into the Company or any of its
Restricted Subsidiaries,
(2) Liens securing Indebtedness under the Senior Credit
Facility and Liens securing other Senior Indebtedness of the Company or
any Guarantor; provided in each case, such Indebtedness is incurred in
compliance with Section 4.06 of this Indenture,
(3) Liens securing Refinancing Indebtedness; provided that any
such Lien does not extend to or cover any Property, Capital Stock or
Indebtedness other than the Property, shares or debt securing the
Indebtedness so refunded, refinanced or extended,
(4) Liens in favor of the Company or any of its Restricted
Subsidiaries,
(5) Liens securing industrial revenue bonds,
(6) Liens to secure Purchase Money Indebtedness that is
otherwise permitted under this Indenture; provided that
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(a) the principal amount of the Indebtedness secured
by such Lien does not exceed 100% of the purchase price, or
the cost of installation, construction or improvement, of the
Property to which such Purchase Money Indebtedness relates,
and
(b) such Lien does not extend to or cover any
Property other than such item of Property and any improvements
on such Property,
(7) statutory liens or landlords', carriers', warehouseman's,
mechanics', suppliers', materialmen's, repairmen's or other like Liens
arising in the ordinary course of business which do not secure any
Indebtedness and with respect to amounts not yet delinquent or being
contested in good faith by appropriate proceedings, if a reserve or
other appropriate provision, if any, as shall be required in conformity
with GAAP shall have been made therefor,
(8) Liens for taxes, assessments or governmental charges that
are being contested in good faith by appropriate proceedings,
(9) easements, rights-of-way, zoning restrictions and other
similar charges or encumbrances or title defects or leases or subleases
granted to others in respect of real property not interfering in any
material respect with the ordinary conduct of the business of the
Company or any of its Restricted Subsidiaries,
(10) other Liens securing obligations incurred in the ordinary
course of business which obligations do not exceed $5 million in the
aggregate at any one time outstanding,
(11) Liens (a) existing on the Issue Date, (b) securing the
Notes and the Guarantees and (c) securing the Existing Notes and the
related guarantees in accordance with the terms thereof as in effect on
the Issue Date,
(12) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment
insurance and other types of social security, including landlord Liens
on leased properties and any Lien securing letters of credit issued in
the ordinary course of business consistent with past practice in
connection therewith, or to secure the performance of ten-
-30-
ders, statutory obligations, surety and appeal bonds, bids, leases,
government contracts, performance and return-of-money bonds and other
similar obligations,
(13) attachment or judgment Liens not giving rise to an Event
of Default,
(14) Liens upon specific items of inventory or other goods and
proceeds of any Person securing such Person's obligations in respect of
bankers' acceptances issued or created for the account of such Person
to facilitate the purchase, shipment, or storage of such inventory or
other goods,
(15) Liens securing reimbursement obligations with respect to
commercial letters of credit which encumber documents and other
Property relating to such letters of credit and products and proceeds
thereof,
(16) Liens encumbering deposits made to secure obligations
arising from statutory, regulatory, contractual, or warranty
requirements of the Company or any of its Restricted Subsidiaries,
including rights of offset and set-off,
(17) Liens securing Hedging Obligations with respect to
Indebtedness that is otherwise permitted under this Indenture,
(18) Liens securing Indebtedness of Foreign Restricted
Subsidiaries of the Company incurred in reliance on clause (8) of the
definition of Permitted Indebtedness,
(19) Liens on assets transferred to a Securitization Entity or
on assets of a Securitization Entity, in either case incurred in
connection with a Qualified Securitization Transaction,
(20) Liens arising from filing Uniform Commercial Code
financing statements regarding leases,
(21) Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of custom duties in connection
with the importation of goods,
(22) deposits made in the ordinary course of business to
secure liability to insurance carriers,
-31-
(23) any interest or title of a lessor or a sublessor under an
operating lease,
(24) Liens under licensing agreements for use of intellectual
property entered into in the ordinary course of business,
(25) Liens imposed by law incurred by the Company or any of
its Restricted Subsidiaries in the ordinary course of business, and
(26) any extensions, substitutions, replacements or renewals
of the foregoing.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization or government (including any agency or
political subdivision thereof).
"Preferred Stock" means any Capital Stock of a Person, however
designated, which entitles the holder thereof to a preference with respect to
dividends, distributions or liquidation proceeds of such Person over the holders
of other Capital Stock issued by such Person.
"Private Placement Legend" means the legend initially set
forth on the Notes in the form set forth on Exhibit A.
"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 Agreement" means the purchase agreement dated as of
February 2, 2000 by and among the Issuers, the Guarantors and CIBC Inc., as
purchaser.
"Purchase Money Indebtedness" means Indebtedness and
Capitalized Lease Obligations of any Person incurred in the normal course of
business of such Person for the purpose of financing all or any part of the
purchase price, or the cost of installation, construction or improvement of, any
Property.
"Purchase Money Note" means a promissory note of a
Securitization Entity evidencing a line of credit, which may be irrevocable,
from the Company or any Subsidiary of the Company in connection with a Qualified
Securitization Transaction to a
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Securitization Entity, which note shall be repaid from cash available to the
Securitization Entity, other than amounts required to be established as reserves
pursuant to agreements, amounts paid to investors in respect of interest,
principal and other amounts owing to such investors and amounts paid in
connection with the purchase of newly generated receivables or newly acquired
equipment.
"Qualified Institutional Buyer" or "QIB" shall have the
meaning specified in Rule 144A promulgated under the Securities Act.
"Qualified Securitization Transaction" means any transaction
or series of transactions that may be entered into by the Company or any of its
Subsidiaries pursuant to which the Company or any or its Subsidiaries may sell,
convey or otherwise transfer to (a) a Securitization Entity (in the case of a
transfer by the Company or any of its Subsidiaries) and (b) any other Person (in
the case of a transfer by a Securitization Entity), or may grant a security
interest in, any accounts receivable or equipment (whether now existing or
arising or acquired in the future) of the Company or any of its Subsidiaries,
and any assets related thereto including, without limitation, all collateral
securing such accounts receivable and equipment, all contracts and contract
rights and all guarantees or other obligations in respect of such accounts
receivable and equipment, proceeds of such accounts receivable and equipment and
other assets (including contract rights) which are customarily transferred or in
respect of which security interests are customarily granted in connection with
asset securitization transactions involving accounts receivable and equipment.
"Redeemable Dividend" means, for any dividend or distribution
with regard to Preferred Stock, the quotient of the dividend or distribution
divided by the difference between one and the maximum statutory federal income
tax rate (expressed as a decimal number between 1 and 0) then applicable to the
issuer of such Preferred Stock.
"Redemption Date" when used with respect to any Note to be
redeemed means the date fixed for such redemption pursuant to this Indenture.
"Refinancing Indebtedness" means Indebtedness that refunds,
refinances, modifies, replaces, defers, supplements or extends the Notes or any
other Indebtedness outstanding on the Issue Date or other Indebtedness permitted
to be incurred by the Company or its Restricted Subsidiaries pursuant to the
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terms of this Indenture (other than pursuant to clauses (1), (4), (6) and (8)
through (16) of the definition of Permitted Indebtedness), but only to the
extent that
(1) the Refinancing Indebtedness is subordinated to the Notes
to at least the same extent as the Indebtedness being refunded,
refinanced, modified, replaced, deferred, supplemented or extended, if
at all,
(2) the Refinancing Indebtedness is scheduled to mature either
(a) no earlier than the Indebtedness being refunded,
refinanced, modified, replaced, deferred, supplemented or
extended, or
(b) after the maturity date of the Notes,
(3) the portion, if any, of the Refinancing Indebtedness that
is scheduled to mature on or prior to the maturity date of the Notes
has a Weighted Average Life to Maturity at the time such Refinancing
Indebtedness is incurred that is equal to or greater than the Weighted
Average Life to Maturity of the portion of the Indebtedness being
refunded, refinanced, modified, replaced, deferred, supplemented or
extended that is scheduled to mature on or prior to the maturity date
of the Notes, and
(4) such Refinancing Indebtedness is in an aggregate principal
amount that is equal to or less than the sum of
(a) the aggregate principal amount of the
Indebtedness being refunded, refinanced, modified, replaced,
deferred, supplemented or extended,
(b) the amount of accrued and unpaid interest, if
any, and premiums owed, if any, not in excess of preexisting
prepayment provisions on such Indebtedness being refunded,
refinanced, modified, replaced, deferred, supplemented or
extended and
(c) the amount of customary fees, expenses and costs
related to the incurrence of such Refinancing Indebtedness.
"Registration Rights Agreement" means the Registration Rights
Agreement dated as of February 2, 2000 among the Issuers, the Guarantors and
CIBC Inc., as purchaser.
-34-
"Regulation S" means Regulation S promulgated under the
Securities Act.
"Restricted Payment" means any of the following:
(1) the declaration or payment of any dividend or any other
distribution or payment on Capital Stock of the Company or any
Restricted Subsidiary of the Company or any payment made to the direct
or indirect holders (in their capacities as such) of Capital Stock of
the Company or any Restricted Subsidiary of the Company (other than (a)
dividends or distributions payable solely in Capital Stock (other than
Disqualified Capital Stock), and (b) in the case of Restricted
Subsidiaries of the Company, dividends or distributions payable to the
Company or to a Restricted Subsidiary of the Company and to the other
holders of Capital Stock of each such Restricted Subsidiary, in each
case on a pro rata basis),
(2) the purchase, redemption or other acquisition or
retirement for value of any Capital Stock of the Company or any of its
Restricted Subsidiaries (other than Capital Stock owned by the Company
or a Wholly Owned Subsidiary of the Company, excluding Disqualified
Capital Stock),
(3) the making of any principal payment on, or the purchase,
defeasance, repurchase, redemption or other acquisition or retirement
for value of any Indebtedness which is subordinated in right of payment
to the Notes prior to any scheduled maturity, scheduled repayment or
scheduled sinking fund payment (other than subordinated Indebtedness
acquired in anticipation of satisfying a scheduled sinking fund
obligation, principal installment or final maturity, in each case due
within one year of the date of acquisition) other than the ABRY
Subordinated Debt,
(4) the making of any Investment or guarantee of any
Investment in any Person other than a Permitted Investment,
(5) any designation of a Restricted Subsidiary as an
Unrestricted Subsidiary (valued at the fair market value of the net
assets of such Restricted Subsidiary) and
(6) forgiveness of any Indebtedness of an Affiliate of the
Company (other than a Restricted Subsidiary) to the Company or a
Restricted Subsidiary of the Company.
-35-
"Restricted Security" has the meaning set forth in Rule
144(a)(3) promulgated under the Securities Act; provided that the Trustee shall
be entitled to request and conclusively rely upon an Opinion of Counsel with
respect to whether any Note is a Restricted Security.
"Restricted Subsidiary" means a Subsidiary of the Company
other than an Unrestricted Subsidiary. The Board of Directors of the Company may
designate any Unrestricted Subsidiary or any Person that is to become a
Subsidiary as a Restricted Subsidiary if immediately after giving effect to such
action (and treating any Indebtedness of such Unrestricted Subsidiary or Person
as having been incurred at the time of such action),
(1) the Company could have incurred at least $1.00 of
additional Indebtedness (other than Permitted Indebtedness) pursuant to
Section 4.06 of this Indenture, and
(2) no Default or Event of Default shall have occurred and be
continuing or result therefrom.
"Rule 144A" means Rule 144A under the Securities Act, as such
Rule may be amended from time to time, or any similar rule (other than Rule 144)
or regulation hereafter adopted by the Commission.
"Sale and Lease-Back Transaction" means any arrangement with
any Person providing for the leasing by the Company or any Restricted Subsidiary
of the Company of any real or tangible personal property, which Property has
been or is to be sold or transferred by the Company or such Restricted
Subsidiary to such Person in contemplation of such leasing.
"S&P" means Standard & Poor's Corporation and its successors.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations of the Commission promulgated thereunder.
"Securitization Entity" means a Wholly Owned Subsidiary of the
Company (or another Person in which the Company or any Subsidiary of the Company
makes an Investment and to which the Company or any Subsidiary of the Company
transfers accounts receivable or equipment and related assets) which engages in
no activities other than in connection with the financing of accounts receivable
or equipment and which is designated by the
-36-
Board of Directors of the Company (as provided below) as a Securitization
Entity: (a) no portion of the Indebtedness or any other obligation (contingent
or otherwise) of which (i) is guaranteed by the Company or any Subsidiary of the
Company (excluding guarantees of obligations (other than the principal of, and
interest on, Indebtedness) pursuant to Standard Securitization Undertakings),
(ii) is recourse to or obligates the Company or any Subsidiary of the Company in
any way other than pursuant to Standard Securitization Undertakings or (iii)
subjects any Property or asset of the Company or any Subsidiary of the Company,
directly or indirectly, contingently or otherwise, to the satisfaction thereof,
other than pursuant to Standard Securitization Undertakings, (b) with which
neither the Company nor any Subsidiary of the Company has any material contract,
agreement, arrangement or understanding other than on terms no less favorable to
the Company or such Subsidiary than those that might be obtained at the time
from Persons that are not Affiliates of the Company, other than fees payable in
the ordinary course of business in connection with servicing receivables of such
entity, and (c) to which neither the Company nor any Subsidiary of the Company
has any obligation to maintain or preserve such entity's financial condition or
cause such entity to achieve certain levels of operating results. Any such
designation by the Board of Directors of the Company shall be evidenced to the
Trustee by filing with the Trustee a certified copy of the Board Resolution of
the Company giving effect to such designation and an officers' certificate
certifying that such designation complied with the foregoing conditions.
"Senior Credit Facility" means one or more credit agreements,
loan agreements or similar agreements providing for working capital advances,
term loans, letter of credit facilities or similar advances, loans, or
facilities to the Company or any of its Subsidiaries, including the Credit and
Guaranty Agreement dated as of March 18, 1999, as amended through the Issue
Date, among the Company, Holdings, certain of the Company's subsidiaries, the
lenders party thereto in their capacities as lenders thereunder, Goldman Sachs
Credit Partners L.P., as Syndication Agent, Canadian Imperial Bank of Commerce,
as Administrative Agent, and Goldman Sachs Credit Partners L.P. and CIBC
Oppenheimer Corp., as Co-Lead Arrangers, initially providing for term loan and
revolving credit facilities including any related notes, guarantees, collateral
documents, instruments and agreements executed in connection therewith, as such
credit facilities and/or related documents may be further amended, restated,
supplemented, renewed, refinanced, replaced, restructured or otherwise modified
from time to time whether or not with the same agents, trustee, representative
lenders or
-37-
group of lenders or holders, and irrespective of any changes in the terms and
conditions thereof. Without limiting the generality of the foregoing, the term
"Senior Credit Facility" shall include agreements in respect of interest rate
agreements and hedging obligations with lenders party to any Senior Credit
Facility and their affiliates and shall also include any amendment, amendment
and restatement, renewal, extension, restructuring, supplement or modification
to any Senior Credit Facility and any and all refundings, refinancings (in whole
or in part) and replacements of any Senior Credit Facility, whether by the same
or any other agents, trustee, representative lenders or lenders or group of
lenders, including one or more agreements (i) extending the maturity of, or
increasing the amount of, any Indebtedness incurred thereunder or contemplated
thereby, or (ii) adding or deleting borrowers or guarantors thereunder, so long
as borrowers and issuers include one or more of the Company and its Restricted
Subsidiaries and their respective successors and assigns,
"Senior Discount Notes" means $75,000,000 aggregate principal
amount at maturity of 13% Senior Discount Notes due 2010 of Holdings and Muzak
Holdings Finance Corp., a Delaware corporation, as co-issuers, in accordance
with the terms of such security as in effect on the Issue Date.
"Senior Discount Notes Indenture" means the indenture pursuant
to which the Senior Discount Notes are issued, as the same may be amended,
restated, supplemented or otherwise modified from time to time.
"Senior Indebtedness" means (1) all Bank Indebtedness and (2)
all principal of and premium, if any, and interest (including, but not limited
to, interest accruing on or after the filing of any petition in any bankruptcy,
reorganization or similar proceeding relating to the Company or any Restricted
Subsidiary, whether or not a claim for such is allowed in such proceeding) on,
and any and all other fees, fees and expenses of counsel, expense reimbursement
obligations, indemnities and other amounts due pursuant to the terms of all
agreements, indentures, documents and instruments providing for, creating,
securing or evidencing or otherwise entered into in connection with
(a) all obligations of the Company with respect to any Hedging
Obligations,
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(b) all obligations of the Company to reimburse any bank or
other person in respect of amounts paid under letters of credit,
acceptances or other similar instruments,
(c) all other Indebtedness of the Company or any Guarantor
which does not provide that it is to rank pari passu with or
subordinate to the Notes, and
(d) all deferrals, renewals, extensions and refundings of, and
amendments, modifications and supplements to, any of the Senior
Indebtedness described above,
in each case, whether outstanding on the Issue Date or created thereafter.
Notwithstanding anything to the contrary in the foregoing, Senior Indebtedness
will not include
(1) Indebtedness of the Company to any of its Subsidiaries, or
to any Affiliate of the Company or any of such Affiliate's
Subsidiaries,
(2) Indebtedness represented by the Notes and the Existing
Notes,
(3) any Indebtedness which by the express terms of the
agreement or instrument creating, evidencing or governing the same is
junior or subordinate in right of payment to any item of Senior
Indebtedness,
(4) any trade payable arising from the purchase of goods or
materials or for services obtained in the ordinary course of business,
(5) Indebtedness incurred in violation of this Indenture,
(6) Indebtedness represented by Disqualified Capital Stock and
(7) any Indebtedness to or guaranteed on behalf of, any
shareholders, Director, officer or employee of the Company or any
Subsidiary of the Company.
"Significant Subsidiary" means, with respect to any Person,
any Restricted Subsidiary of such Person that satisfies the criteria for a
"significant subsidiary" set forth in Rule 1.02(w) of Regulation S-X under the
Exchange Act, as such Rule is in effect on the Issue Date.
-39-
"Standard Securitization Undertakings" means representations,
warranties, covenants and indemnities entered into by the Company or any
Subsidiary of the Company which are reasonably customary in an accounts
receivable or equipment transaction.
"Subsidiary" of any specified Person means any corporation,
partnership, limited liability company, joint venture, association or other
business entity, whether now existing or hereafter organized or acquired,
(1) in the case of a corporation, of which more than 50% of
the total voting power of the Capital Stock entitled (without regard to
the occurrence of any contingency) to vote in the election of
directors, officers or trustees thereof is held by such first-named
Person or any of its Subsidiaries; or
(2) in the case of a partnership, limited liability company,
joint venture, association or other business entity, with respect to
which such first-named Person or any of its Subsidiaries has the power
to direct or cause the direction of the management and policies of such
entity by contract or otherwise or if in accordance with GAAP such
entity is consolidated with the first-named Person for financial
statement purposes.
Notwithstanding the foregoing a charitable trust or foundation organized
pursuant to section 501(c)(3) of the Internal Revenue Code of 1986, as amended,
shall not be a "Subsidiary."
"Trust Indenture Act" or "TIA" means the Trust Indenture Act
of 1939 (15 U.S. Code sections 77aaa-77bbbb) as in effect on the date of this
Indenture (except as provided in Section 8.03 hereof).
"Trust Officer" means any officer of the Trustee in its
Corporate Trust Department with direct responsibility for the administration of
the trusts established hereby and, also, with respect to any particular matter,
any other officer of the Trustee to whom such matter is referred because of such
officer's knowledge of, and familiarity with, the particular subject.
"Trustee" means the party named as such in this Indenture
until a successor replaces it pursuant to this Indenture and thereafter means
the successor.
-40-
"Unrestricted Subsidiary" means
(1) any Subsidiary of an Unrestricted Subsidiary and
(2) any Subsidiary of the Company which is classified after
the Issue Date as an Unrestricted Subsidiary by a Board Resolution of
the Company;
provided that a Subsidiary may be so classified as an Unrestricted Subsidiary
only if
(a) such classification is in compliance with Section 4.07 of
this Indenture,
(b) immediately after giving effect to such classification,
the Company could have incurred at least $1.00 of additional
Indebtedness (other than Permitted Indebtedness) pursuant to Section
4.06 of this Indenture,
(c) no Default or Event of Default shall have occurred and be
continuing or result therefrom, and
(d) neither the Company nor any Restricted Subsidiary shall at
any time
(i) provide a guarantee of, or similar credit support
to, any Indebtedness of such Subsidiary (including any
undertaking, agreement or instrument evidencing such
Indebtedness),
(ii) be directly or indirectly liable for any
Indebtedness of such Subsidiary or
(iii) be directly or indirectly liable for any other
Indebtedness which provides that the holder thereof may (upon
notice, lapse of time or both) declare a default thereon (or
cause the payment thereof to be accelerated or payable prior
to its final scheduled maturity) upon the occurrence of a
default with respect to any other Indebtedness (other than
Indebtedness assumed by such Subsidiary in connection with the
Electro Systems Acquisition) that is Indebtedness of such
Subsidiary (including any corresponding right to take
enforcement action against such Subsidiary),
except in the case of clause (i) or (ii) to the extent
-41-
(i) that the Company or such Restricted Subsidiary
could otherwise provide such a guarantee or incur such
Indebtedness (other than as Permitted Indebtedness) pursuant
to Section 4.06 of this Indenture and
(ii) the provision of such guarantee and the
incurrence of such Indebtedness otherwise would be permitted
under Section 4.07 of this Indenture.
The Trustee shall be given prompt notice by the Company of each Board Resolution
of the Company under this provision, together with a copy of each such Board
Resolution. Electro Systems shall be an Unrestricted Subsidiary as of the Issue
Date.
"U.S. Government Obligations" means (a) securities that are
direct obligations of the United States of America for the payment of which its
full faith and credit are pledged or (b) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America, the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act) as custodian with respect to any such U.S. Government
Obligation or a specific payment of principal of or interest on any such U.S.
Government Obligation held by such custodian for the account of the holder of
such depository receipt; provided that (except as required by law) such
custodian is not authorized to make any deduction from the amount payable to the
holder of such depository receipt from any amount received by the custodian in
respect of the U.S. Government Obligation or a specific payment of principal or
interest on any such U.S. Government Obligation held by such custodian for the
account of the holder of such depository receipt.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a) the then
outstanding aggregate principal amount of such Indebtedness into (b) the sum of
the total of the products obtained by multiplying (i) the amount of each then
remaining installment, sinking fund, serial maturity or other required payment
of principal, including payment at final maturity, in respect thereof, by (ii)
the number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.
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"Wholly-Owned Subsidiary" means any Restricted Subsidiary, all
of the outstanding voting securities (other than directors' qualifying shares)
of which are owned, directly or indirectly, by the Company.
Section 1.01. Other Definitions.
The definitions of the following terms may be found in the
sections indicated as follows:
Term Defined in Section
---- ------------------
"Affiliate Transaction".............................. 4.10
"Agent Members"...................................... 2.14
"Bankruptcy Law"..................................... 6.01
"Business Day"....................................... 12.08
"Certificated Notes"................................. 2.01
"Change of Control Offer"............................ 4.16
"Change of Control Payment Date"..................... 4.16
"Change of Control Purchase Price"................... 4.15
"Covenant Defeasance"................................ 9.03
"Custodian".......................................... 6.01
"Event of Default"................................... 6.01
"Excess Proceeds Offer".............................. 4.09
"Excess Proceeds Payment Date"....................... 4.09
"Global Notes"....................................... 2.01
"Guaranteed Obligations.............................. 10.01
"Guarantor Payment Blockage Period".................. 10.11
"Guarantor Representation"........................... 10.11
"Initial Blockage Period"............................ 11.03
"Initial Guarantee Blockage Period".................. 10.11
"Legal Defeasance"................................... 9.02
"Legal Holiday"...................................... 12.08
"Paying Agent"....................................... 2.03
"Payment Blockage Period"............................ 11.03
"Permitted Tax Distributions"........................ 4.07
"Registered Exchange"................................ 2.02
"Registrar".......................................... 2.03
"Regulation S Global Notes".......................... 2.01
"Representative"..................................... 11.03
"Resale Restriction Termination Date"................ 2.15
"U.S. Global Notes".................................. 2.01
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Section 1.02. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
portion of such provision required to be incorporated herein in order for this
Indenture to be qualified under the TIA 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 securityholder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor on the indenture securities" means the Issuers, the
Guarantors or any other obligor on the Notes.
All other terms used in this Indenture that are defined by the
TIA, defined in the TIA by reference to another statute or defined by SEC rule
have the meanings therein assigned to them.
Section 1.03. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it herein, whether
defined expressly or by reference;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the
plural include the singular; and
(5) words used herein implying any gender shall apply to every
gender.
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ARTICLE 2
THE NOTES
Section 2.01. Dating; Incorporation of Form in Indenture.
The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A which is incorporated in and
made part of this Indenture. The Notes may have notations, legends or
endorsements required by law, stock exchange rule or usage. The Issuers may use
"CUSIP" numbers in issuing the Notes. The Issuers shall approve the form of the
Notes. Each Note shall be dated the date of its authentication.
Unless the applicable Holder requests Notes in the form of
physical certificated Notes in registered form ("Certificated Notes"), which
shall be substantially in the form of Exhibit A, Notes offered and sold in
reliance on Rule 144A or in offshore transactions in reliance on Regulation S
shall be issued initially in the form of permanent Global Notes in registered
form, substantially in the form set forth in Exhibit A ("Global Notes"),
deposited with the Depository, duly executed by the Issuers and authenticated by
the Trustee as hereinafter provided and shall bear the legend set forth on
Exhibit B. The aggregate principal amount of any Global Note may from time to
time be increased or decreased by adjustments made on the records of the
Depository, as hereinafter provided.
Notes offered and sold to Qualified Institutional Buyers in
reliance on Rule 144A issued in the form of one or more Global Notes (the "U.S.
Global Note") shall be registered in the name of the Depository or its nominee
and deposited with the Depository, duly executed by the Issuers and
authenticated by the Trustee as hereinafter provided, for credit by the
Depository to the respective accounts of beneficial owners of the Notes
represented thereby (or such other accounts as they may direct).
Notes offered and sold in reliance on Regulation S issued in
the form of Global Notes (the "Regulation S Global Note") shall be registered in
the name of the Depository or its nominee, duly executed by the Issuers and
authenticated by the Trustee as hereinafter provided, for credit by the
Depository to the respective accounts of the beneficial owners of the
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Notes represented thereby (or such other accounts as they may direct).
The Issuers shall cause the U.S. Global Note and the
Regulation S Global Note to have separate CUSIP and ISIN numbers.
Section 2.02. Execution and Authentication.
The Notes shall be executed on behalf of the Issuers by two
Officers of each of the Issuers or an Officer and the Secretary of each of the
Issuers. Such signature may be either manual or facsimile. The Issuers' seals
may be impressed, affixed, imprinted or reproduced on the Notes and may be in
facsimile form.
If an Officer whose signature is on a Note no longer holds
that office at the time the Trustee authenticates the Note, the Note shall be
valid nevertheless.
A Note shall not be valid until the Trustee manually signs the
certificate of authentication on the Note. Such signature shall be conclusive
evidence that the Note has been authenticated under this Indenture.
The Trustee or an authentication agent shall authenticate (i)
Initial Notes for original issue on the Issue Date in an aggregate principal
amount not to exceed $12,000,000, (ii) one or more series of Notes for original
issue after the Issue Date (such Notes to be substantially in the form of
Exhibit A) in an aggregate principal amount not to exceed $38,000,000 and (iii)
any Additional Notes, in each case upon receipt of an authentication order in
the form of an Officers' Certificate. The aggregate principal amount of Notes
(excluding any Additional Notes) outstanding at any time may not exceed
$50,000,000 except as provided in Section 2.07 hereof. Upon receipt of an
authentication order in the form of an Officers' Certificate, the Trustee shall
authenticate an additional series of Notes for issuance in exchange for all
Notes previously issued pursuant to an exchange offer registered under the
Securities Act (a "Registered Exchange") or pursuant to a Private Exchange (as
defined in the Registration Rights Agreement). Exchange Notes (as defined in the
Registration Rights Agreement) may have such distinctive series designation and
"CUSIP" numbers as and such changes in the form thereof as are specified in the
Officers' Certificate referred to in the preceding sentence. Exchange Notes
issued pursuant to a Registered Exchange shall not bear the Private Placement
Legend.
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The Notes shall be issuable only in registered form without coupons and only in
denominations of $1,000 and integral multiples thereof.
The Trustee may appoint an authenticating agent to
authenticate Notes. Any such appointment shall be evidenced by an instrument
signed by an authorized officer of the Trustee, a copy of which shall be
furnished to the Issuers. 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 right as an Agent to deal with the Issuers or
an Affiliate of any Issuer.
Section 2.03. Registrar, Paying Agent and Calculation Agent.
The Issuers shall maintain an office or agency where Notes may
be presented for registration of transfer or for exchange ("Registrar"), an
office or agency located in the Borough of Manhattan, City of New York, State of
New York where Notes may be presented for payment ("Paying Agent") and an office
or agency where notices and demands to or upon the Issuers in respect of the
Notes and this Indenture may be served. The Registrar shall keep a register of
the Notes and of their transfer and exchange. The Registrar shall provide the
Issuers a current copy of such register from time to time upon request of the
Issuers. The Issuers may have one or more co-registrars and one or more
additional paying agents. None of the Issuers nor any Affiliate of the Issuers
may act as Paying Agent or Calculation Agent. The Issuers may change any Paying
Agent, Registrar, co-registrar or Calculation Agent without notice to any
Noteholder.
The Issuers shall enter into an appropriate agency agreement
with any Registrar, Paying Agent or Calculation Agent not a party to this
Indenture. The agreement shall implement the provisions of this Indenture that
relate to such Agent. The Issuers shall notify the Trustee of the name and
address of any such Agent. If the Issuers fail to maintain a Registrar, Paying
Agent or Calculation Agent, or agent for service of notices and demands, or fail
to give the foregoing notice, the Trustee shall act as such. The Issuers
initially appoint the Trustee as Registrar, Paying Agent, Calculation Agent and
agent for service of notices and demands in connection with the Notes.
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Section 2.04. Paying Agent to Hold Money in Trust.
The Issuers shall require each Paying Agent other than the
Trustee to agree in writing that each Paying Agent shall hold in trust for the
benefit of the Holders or the Trustee all assets held by the Paying Agent for
the payment of principal of, premium, if any, or interest on Notes (whether such
assets have been distributed to it by the Issuers or any other obligor on the
Notes), and shall notify the Trustee in writing of any Default in making any
such payment. The Issuers at any time may require a Paying Agent to distribute
all assets held by it to the Trustee and account for any assets disbursed and
the Trustee may at any time during the continuance of any payment Default, upon
written request to a Paying Agent, require such Paying Agent to forthwith
distribute to the Trustee all assets so held in trust by such Paying Agent
together with a complete accounting of such sums. Upon doing so, the Paying
Agent shall have no further liability for such assets.
Section 2.05. Noteholder 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 Noteholders. If the Trustee is not the Registrar, the Issuers shall
furnish to the Trustee on or before each March 1, June 1, September 1, and
December 1 in each year, 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 Noteholders.
Section 2.06. Transfer and Exchange.
When a Note is presented to the Registrar with a request to
register the transfer thereof, the Registrar shall register the transfer as
requested if the requirements of applicable law are met and, when Notes are
presented to the Registrar with a request to exchange them for an equal
principal amount of Notes of other authorized denominations, the Registrar shall
make the exchange as requested; provided that every Note presented or
surrendered for registration of transfer or exchange shall be duly endorsed, or
be accompanied by a written instrument of transfer in form satisfactory to the
Issuers and the Registrar duly executed by the Holder thereof or his attorney
duly authorized in writing. To permit transfers and exchanges, upon surrender of
any Note for registration of transfer at the office or agency maintained
pursuant to Section 2.03 hereof, the Issuers shall execute and the Trustee shall
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authenticate Notes at the Registrar's request. Any exchange or transfer shall be
without charge, except that the Issuers may require payment by the Holder of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation to a transfer or exchange, but this provision shall not apply to any
exchange pursuant to Sections 2.09, 3.06 or 8.05 hereof. The Trustee shall not
be required to register transfers of Notes or to exchange Notes for a period of
15 days before selection of any Notes to be redeemed. The Trustee shall not be
required to exchange or register transfers of any Notes called or being called
for redemption in whole or in part, except the unredeemed portion of any Note
being redeemed in part.
Any Holder of the Global Note shall, by acceptance of such
Global Note, agree that transfers of the beneficial interests in such Global
Note may be effected only through a book entry system maintained by the
Depository of such Global Note (or its agent), and that ownership of a
beneficial interest in the Global Note shall be required to be reflected in a
book entry.
Section 2.07. Replacement Notes.
If a mutilated Note is surrendered to the Trustee or if the
Holder presents evidence to the satisfaction of the Issuers and the Trustee that
the Note has been lost, destroyed or wrongfully taken, the Issuers shall issue
and the Trustee shall authenticate a replacement Note. An indemnity bond may be
required by the Issuers or the Trustee that is sufficient in the judgment of the
Issuers and the Trustee to protect the Issuers, the Trustee or any Agent from
any loss which any of them may suffer if a Note is replaced. In every case of
destruction, loss or theft, the applicant shall also furnish to the Issuers and
to the Trustee evidence to their satisfaction of the destruction, loss or the
theft of such Note and the ownership thereof. Each of the Issuers and the
Trustee may charge for its expenses in replacing a Note. Every replacement Note
is an additional obligation of the Issuers. In the event any such mutilated,
lost, destroyed or wrongfully taken Note has become due and payable, the Issuers
in their discretion may pay such Note instead of issuing a new Note in
replacement thereof. The provisions of this Section 2.07 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
replacement or payment of mutilated, lost, destroyed or wrongfully taken Notes.
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Section 2.08. Outstanding Notes.
Notes outstanding at any time are all Notes authenticated by
the Trustee except for those cancelled by it, those delivered to it for
cancellation, and those described in this Section 2.08 as not outstanding.
If a Note is replaced pursuant to Section 2.07, it ceases to
be outstanding until the Issuers and the Trustee receive proof satisfactory to
each of them that the replaced Note is held by a bona fide purchaser.
If a Paying Agent holds on a Redemption Date or Maturity Date
money sufficient to pay the principal of, premium, if any, and accrued interest
on Notes payable on that date, then on and after that date such Notes cease to
be outstanding and interest on them ceases to accrue.
Subject to Section 12.06, a Note does not cease to be
outstanding solely because the Issuers or any Affiliate of an Issuer hold the
Note.
Section 2.09. Temporary Notes.
Until definitive Notes are ready for delivery, the Issuers may
prepare and the Trustee shall authenticate temporary Notes. Temporary Notes
shall be substantially in the form, and shall carry all rights, of definitive
Notes but may have variations that the Issuers consider appropriate for
temporary Notes. Without unreasonable delay, the Issuers shall prepare and the
Trustee shall authenticate definitive Notes in exchange for temporary Notes
presented to it.
Section 2.10. Cancellation.
The Issuers 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 transfer, exchange or payment. The Trustee
shall cancel and retain or, upon written request of the Issuers, may destroy or
return to the Issuers in accordance with its normal practice, all Notes
surrendered for transfer, exchange, payment or cancellation and if such Notes
are destroyed, deliver a certificate of destruction to the Issuers. Subject to
Section 2.07 hereof, the Issuers may not issue new Notes to replace Notes in
respect of which they have previously paid all principal, premium and interest
accrued thereon, or delivered to the Trustee for cancellation.
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Section 2.11. Defaulted Interest.
If the Issuers default in a payment of interest on the Notes,
they shall pay the defaulted amounts, plus any interest payable on defaulted
amounts pursuant to Section 4.01 hereof, to the persons who are Noteholders on a
subsequent special record date. The Issuers shall fix the special record date
and payment date in a manner satisfactory to the Trustee and provide the Trustee
at least 20 days notice of the proposed amount of defaulted interest to be paid
and the special payment date. At least 15 days before the special record date,
the Issuers shall mail or cause to be mailed to each Noteholder at its address
as it appears on the Notes register maintained by the Registrar a notice that
states the special record date, the payment date (which shall be not less than
five nor more than ten days after the special record date), and the amount to be
paid. In lieu of the foregoing procedures, the Issuers may pay defaulted
interest in any other lawful manner satisfactory to the Trustee.
Section 2.12. Deposit of Moneys.
Prior to 10:00 a.m., New York City time, on each Interest
Payment Date, Redemption Date and Maturity Date, the Issuers shall have
deposited with the Paying Agent in immediately available funds U.S. legal tender
sufficient to make payments, if any, due on such Interest Payment Date,
Redemption Date or Maturity Date, as the case may be, in a timely manner which
permits the Trustee to remit payment to the Holders on such Interest Payment
Date, Redemption Date or Maturity Date, as the case may be. The principal and
interest on Global Notes shall be payable to the Depository or its nominee, as
the case may be, as the sole registered owner and the sole holder of the Global
Notes represented thereby. The principal and interest on Notes in certificated
form shall be payable at the office of the Paying Agent.
Section 2.13. CUSIP Number.
The Issuers in issuing the Notes may use one or more "CUSIP"
numbers, and if so, the Trustee shall use such CUSIP numbers in notices of
redemption or exchange as a convenience to Holders, provided that any such
notice may state that no representation is made as to the correctness or
accuracy of the CUSIP numbers printed in the notice or on the Notes, and that
reliance may be placed only on the other identification numbers printed on the
Notes.
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Section 2.14. Book-Entry Provisions for Global Notes.
(a) The Global Notes initially shall (i) be registered in the
name of the Depository or the nominee of such Depository and (ii) bear legends
as set forth in Exhibit B.
Members of, or participants in, the Depository ("Agent
Members") shall have no rights under this Indenture with respect to any Global
Note held on their behalf by the Depository or under the Global Note, and the
Depository may be treated by the Issuers, the Trustee and any agent of the
Issuers or the Trustee as the absolute owner of the Global Note for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Issuers, the Trustee or any agent of the Issuers or the Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Depository or impair, as between the Depository and its Agent Members, the
operation of customary practices governing the exercise of the rights of a
Holder.
(b) Interests of beneficial owners in the Global Notes may be
transferred or exchanged for Certificated Notes in accordance with the rules and
procedures of the Depository and the provisions of Section 2.15. In addition,
Certificated Notes shall be transferred to all beneficial owners in exchange for
their beneficial interests in Global Notes if (i) the Depository (x) notifies
the Issuers that it is unwilling or unable to continue as Depository for any
Global Note or (y) has ceased to be a clearing company registered under the
Exchange Act and, in each case, a successor depositary is not appointed by the
Issuers within 90 days of such notice, (ii) the Issuers, at their option, notify
the Trustee in writing that they elect to cause the issuance of Certificated
Notes, or (iii) a Default or an Event of Default has occurred and is continuing
and the Registrar has received a written request from the Depository to issue
Certificated Notes.
(c) In connection with any transfer or exchange of a portion
of the beneficial interest in any Global Note to beneficial owners pursuant to
paragraph (b), the Registrar shall (if one or more Certificated Notes are to be
issued) reflect on its books and records the date and a decrease in the
principal amount of the Global Note in an amount equal to the principal amount
of the beneficial interest in the Global Note to be transferred, and the Issuers
shall execute, and the Trustee shall upon receipt of a written order from the
Issuers authenticate and make available for delivery, one or more Certificated
Notes of like tenor and amount.
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(d) In connection with the transfer of Global Notes as an
entirety to beneficial owners pursuant to paragraph (b), the Global Notes shall
be deemed to be surrendered to the Trustee for cancellation, and the Issuers
shall execute, and the Trustee shall, upon receipt of an authentication order
from the Issuers in the form of an Officers' Certificate, authenticate and
deliver, to each beneficial owner identified by the Depository in writing in
exchange for its beneficial interest in the Global Notes, an equal aggregate
principal amount of Certificated Notes of authorized denominations.
(e) Any Certificated Note constituting a Restricted Security
delivered in exchange for an interest in a Global Note pursuant to paragraph
(b), (c) or (d) shall, except as otherwise provided by Section 2.15, bear the
Private Placement Legend.
(f) The Holder of any Global Note may grant proxies and
otherwise authorize any Person, including Agent Members and Persons that may
hold interests through Agent Members, to take any action which a Holder is
entitled to take under this Indenture or the Notes.
Section 2.15. Registration of Transfers and Exchanges.
(a) Transfer and Exchange of Certificated Notes. When
Certificated Notes are presented to the Registrar or co-Registrar with a
request:
(i) to register the transfer of the Certificated Notes; or
(ii) to exchange such Certificated Notes for an equal
principal amount of Certificated Notes of other authorized
denominations,
the Registrar or co-Registrar shall register the transfer or make the exchange
as requested if the requirements under this Indenture as set forth in this
Section 2.15 for such transactions are met; provided, however, that the
Certificated Notes presented or surrendered for registration of transfer or
exchange:
(I) shall be duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Registrar or
co-Registrar, duly executed by the Holder thereof or his attorney duly
authorized in writing; and
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(II) in the case of Certificated Notes the offer and sale of
which have not been registered under the Securities Act and are
presented for transfer or exchange prior to (x) the date which is two
years after the later of the date of original issue and the last date
on which any Issuer or any Affiliate of an Issuer was the owner of such
Note, or any predecessor thereto and (y) such later date, if any, as
may be required by any subsequent change in applicable law (the "Resale
Restriction Termination Date"), such Certificated Notes shall be
accompanied, in the sole discretion of the Issuers, by the following
additional information and documents, as applicable:
(A) if such Certificated Note is being delivered to
the Registrar or co-Registrar by a Holder for registration in
the name of such Holder, without transfer, a certification
from such Holder to that effect (substantially in the form of
Exhibit C hereto); or
(B) if such Certificated Note is being transferred to
a Qualified Institutional Buyer in accordance with Rule 144A,
a certification to that effect (substantially in the form of
Exhibit C hereto); or
(C) if such Certificated Note is being transferred in
reliance on Regulation S, delivery of a certification to that
effect (substantially in the form of Exhibit C hereto) and a
transferor certificate for Regulation S transfers
substantially in the form of Exhibit D-1 hereto; or
(D) if such Certificated Note is being transferred to
an Institutional Accredited Investor, delivery of
certification substantially in the form of Exhibit C hereto, a
certificate of the transferee in substantially the form of
Exhibit D-2 and an Opinion of Counsel and/or other information
reasonably satisfactory to the Issuers to the effect that such
transfer is in compliance with the Securities Act; or
(E) if such Certificated Note is being transferred in
reliance on Rule 144 under the Securities Act, delivery of a
certification to that effect substantially in the form of
Exhibit C hereto; or
(F) if such Certificated Note is being transferred in
reliance on another exemption from the reg-
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istration requirements of the Securities Act, a certification to that
effect (substantially in the form of Exhibit C hereto) and an Opinion
of Counsel reasonably acceptable to the Issuers to the effect that such
transfer is in compliance with the Securities Act.
(b) Restrictions on Transfer of a Certificated Note for a
Beneficial Interest in a Global Note. A Certificated Note may not be exchanged
for a beneficial interest in a Global Note except upon satisfaction of the
requirements set forth below. Upon receipt by the Registrar or co-Registrar of a
Certificated Note, duly endorsed or accompanied by appropriate instruments of
transfer, in form satisfactory to the Registrar or co-Registrar, together with:
(A) in the case of Certificated Notes, the offer and sale of
which have not been registered under the Securities Act and which are
presented for transfer prior to the Resale Restriction Termination
Date, certification, substantially in the form of Exhibit C hereto,
that such Certificated Note is being transferred (I) to a Qualified
Institutional Buyer or (II) in an offshore transaction in reliance on
Regulation S (and in the case of this clause II, the Issuers shall have
received a transferor certificate for Regulation S transfers
substantially in the form of Exhibit D-1 hereto); and
(B) written instructions from the Holder thereof directing the
Registrar or co-Registrar to make, or to direct the Depository to make,
an endorsement on the applicable Global Note to reflect an increase in
the aggregate principal amount of the Notes represented by the Global
Note,
then the Registrar or co-Registrar shall cancel such Certificated Note and
cause, or direct the Depository to cause, in accordance with the standing
instructions and procedures existing between the Depository and the Registrar or
co-Registrar, the principal amount of Notes represented by the applicable Global
Note to be increased accordingly. If no Global Note representing Notes held by
Qualified Institutional Buyers or Persons acquiring Notes in offshore
transactions in reliance on Regulation S, as the case may be, is then
outstanding, the Issuers shall issue and the Trustee shall, upon receipt of an
authentication order in the form of an Officers' Certificate in accordance with
Section 2.02, authenticate such a Global Note in the appropriate principal
amount.
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(c) Transfer and Exchange of Global Notes. The transfer and
exchange of Global Notes or beneficial interests therein shall be effected
through the Depository in accordance with this Indenture (including the
restrictions on transfer set forth herein) and the procedures of the Depository
therefor. Upon receipt by the Registrar or co-Registrar of written instructions,
or such other instruction as is customary for the Depository, from the
Depository or its nominee, requesting the registration of transfer of an
interest in a U.S. Global Note or Regulation S Global Note, as the case may be,
to another type of Global Note, together with the applicable Global Notes (or,
if the applicable type of Global Note required to represent the interest as
requested to be transferred is not then outstanding, only the Global Note
representing the interest being transferred), the Registrar or Co-Registrar
shall cancel such Global Notes (or Global Note) and the Issuers shall issue and
the Trustee shall, upon receipt of an authentication order in the form of an
Officers' Certificate in accordance with Section 2.02, authenticate new Global
Notes of the types so cancelled (or the type so cancelled and applicable type
required to represent the interest as requested to be transferred) reflecting
the applicable increase and decrease of the principal amount of Notes
represented by such types of Global Notes, giving effect to such transfer. If
the applicable type of Global Note required to represent the interest as
requested to be transferred is not outstanding at the time of such request, the
Issuers shall issue and the Trustee shall, upon written instructions from the
Issuers in accordance with Section 2.02, authenticate a new Global Note of such
type in principal amount equal to the principal amount of the interest requested
to be transferred.
(d) Transfer of a Beneficial Interest in a Global Note for a
Certificated Note. (i) Any Person having a beneficial interest in a Global Note
may upon request exchange such beneficial interest for a Certificated Note. Upon
receipt by the Registrar or co-Registrar of written instructions, or such other
form of instructions as is customary for the Depository, from the Depository or
its nominee on behalf of any Person having a beneficial interest in a Global
Note and upon receipt by the Trustee of a written order or such other form of
instructions as is customary for the Depository or the Person designated by the
Depository as having such a beneficial interest containing registration
instructions and, in the case of any such transfer or exchange of a beneficial
interest in Notes the offer and sale of which have not been registered under the
Securities Act and which Notes are presented for transfer or ex-
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change prior to the Resale Restriction Termination Date, the following
additional information and documents:
(A) if such beneficial interest is being transferred to the
Person designated by the Depository as being the beneficial owner, a
certification from such Person to that effect (substantially in the
form of Exhibit C hereto); or
(B) if such beneficial interest is being transferred to a
Qualified Institutional Buyer in accordance with Rule l44A, a
certification to that effect (substantially in the form of Exhibit C
hereto); or
(C) if such beneficial interest is being transferred in
reliance on Regulation S, delivery of a certification to that effect
(substantially in the form of Exhibit C hereto) and a transferor
certificate for Regulation S transfers substantially in the form of
Exhibit D-1 hereto; or
(D) if such beneficial interest is being transferred to an
Institutional Accredited Investor, delivery of certification
substantially in the form of Exhibit C hereto, a certificate of the
transferee in substantially the form of Exhibit D-2 and an Opinion of
Counsel and/or other information reasonably satisfactory to the Issuers
to the effect that such transfer is in compliance with the Securities
Act; or
(E) if such beneficial interest is being transferred in
reliance on Rule 144 under the Securities Act, delivery of a
certification to that effect substantially in the form of Exhibit C
hereto; or
(F) if such beneficial interest is being transferred in
reliance on another exemption from the registration requirements of the
Securities Act, a certification to that effect (substantially in the
form of Exhibit C hereto) and an Opinion of Counsel reasonably
satisfactory to the Issuers to the effect that such transfer is in
compliance with the Securities Act,
then the Registrar or co-Registrar will cause, in accordance with the standing
instructions and procedures existing between the Depository and the Registrar or
co-Registrar, the aggregate principal amount of the applicable Global Note to be
reduced and, following such reduction, the Issuers will execute and, upon
receipt of an authentication order in the form of an Offi-
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cers' Certificate in accordance with Section 2.02, the Trustee will authenticate
and deliver to the transferee a Certificated Note in the appropriate principal
amount.
(ii) Certificated Notes issued in exchange for a beneficial
interest in a Global Note pursuant to this Section 2.15(d) shall be registered
in such names and in such authorized denominations as the Depository, pursuant
to instructions from its direct or indirect participants or otherwise, shall
instruct the Registrar or co-Registrar in writing. The Registrar or co-Registrar
shall deliver such Certificated Notes to the Persons in whose names such
Certificated Notes are so registered.
(e) Restrictions on Transfer and Exchange of Global Notes.
Notwithstanding any other provisions of this Indenture, a Global Note may not be
transferred as a whole except by the Depository to a nominee of the Depository
or by a nominee of the Depository to the Depository or another nominee of the
Depository or by the Depository or any such nominee to a successor Depository or
a nominee of such successor Depository.
(f) Private Placement Legend. Upon the transfer, exchange or
replacement of Notes not bearing the Private Placement Legend, the Registrar or
co-Registrar shall deliver Notes that do not bear the Private Placement Legend.
Upon the transfer, exchange or replacement of Notes bearing the Private
Placement Legend, the Registrar or co-Registrar shall deliver only Notes that
bear the Private Placement Legend unless, and the Trustee is hereby authorized
to deliver Notes without the Private Placement Legend if, (i) the Resale
Restriction Termination Date shall have occurred, (ii) there is delivered to the
Trustee an Opinion of Counsel reasonably satisfactory to the Issuers and the
Trustee to the effect that neither such legend nor the related restrictions on
transfer are required in order to maintain compliance with the provisions of the
Securities Act or (iii) such Note has been sold pursuant to an effective
registration statement under the Securities Act.
(g) General. By its acceptance of any Note bearing the Private
Placement Legend, each Holder of such a Note acknowledges the restrictions on
transfer of such Note set forth in this Indenture and in the Private Placement
Legend and agrees that it will transfer such Note only as provided in this
Indenture.
The Registrar shall retain copies of all letters, notices and
other written communications received pursuant to
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Section 2.14 or this Section 2.15. The Issuers shall have the right to inspect
and make copies of all such letters, notices or other written communications at
any reasonable time upon the giving of reasonable written notice to the
Registrar.
Section 2.16. Joint and Several Liability.
Except as otherwise expressly provided herein, the Issuers
shall be jointly and severally liable for the performance of all obligations and
covenants under this Indenture and the Notes.
Section 2.17. Ranking of Notes and Guarantees Relative to
Existing Notes and Related Guarantees.
The Issuers and the Guarantors covenant and agree, and each
Holder, by its acceptance thereof, likewise covenants and agrees, that the
Indebtedness represented by the Notes and the Guarantees and the payment of all
Obligations on the Notes and the Guarantees hereby expressly rank pari passu in
right of payment with the Existing Notes and the related guarantees thereof, as
applicable.
ARTICLE 3
REDEMPTION
Section 3.01. Notices to Trustee.
If the Issuers elect or are required to redeem Notes pursuant
to Section 3.07 hereof, at least 60 days prior to the Redemption Date (except in
the case of a redemption pursuant to Section 3.07(c) (in which case the Issuers
shall give the Trustee notice as soon as reasonably practicable but in no event
later than three Business Days prior to the Redemption Date)) or during such
other period as the Trustee may agree to, the Issuers shall notify the Trustee
in writing of the Redemption Date, the principal amount of Notes to be redeemed
and the redemption price, and deliver to the Trustee an Officers' Certificate
stating that such redemption will comply with the conditions contained in
Section 3.07 hereof, as appropriate.
Section 3.02. Selection by Trustee of Notes to Be Redeemed.
In the event that less than all of the Notes are to be
redeemed at any time, selection of the Notes for redemption
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will be made by the Trustee 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 listed on a national securities exchange, on a pro rata basis, by
lot or by such method as the Trustee shall deem fair and appropriate; provided,
that no Notes of $1,000 principal amount or less shall be redeemed in part. The
Trustee may select for redemption portions of the principal of the Notes that
have denominations larger than $1,000. The Trustee shall promptly notify the
Issuers of the Notes selected for redemption and, in the case of any Notes
selected for partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture unless the context otherwise requires,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
Section 3.03. Notice of Redemption.
Notice of redemption shall be mailed by first class mail at
least 30 but not more than 60 calendar days before the Redemption Date (except
in the case of a redemption pursuant to Section 3.07(c) (in which case the
notice shall be mailed at least one Business Day prior to the Redemption Date))
to each Holder of Notes to be redeemed at its registered address. If any Note is
to be redeemed in part only, the notice of redemption that relates to such Note
shall state the portion of the principal amount thereof to be redeemed.
The notice shall identify the Notes to be redeemed (including
the CUSIP number(s) thereof) and shall state:
(1) the Redemption Date;
(2) the redemption price and the amount of accrued interest,
if any, to be paid;
(3) that, if any Note is being redeemed in part, the portion
of the principal amount at maturity (equal to $1,000 in principal
amount or any integral multiple thereof) of such Note to be redeemed
and that, on and after the Redemption Date, upon surrender of such
Note, a new Note or Notes in principal amount equal to the unredeemed
portion thereof will be issued;
(4) the name, address and telephone number of the Paying
Agent;
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(5) that Notes called for redemption must be surrendered to
the Paying Agent at the address specified to collect the redemption
price plus accrued interest, if any;
(6) that, unless the Issuers default in making the redemption
payment, interest on Notes called for redemption ceases to accrue on
and after the Redemption Date and the only remaining right of the
Holders is to receive payment of the redemption price plus accrued
interest to the Redemption Date upon surrender of the Notes to the
Paying Agent;
(7) the paragraph of Section 3.07 hereof pursuant to which the
Notes called for redemption are being redeemed; and
(8) the aggregate principal amount of Notes that are being
redeemed.
Section 3.04. Effect of Notice of Redemption.
Once the notice of redemption described in Section 3.03 is
mailed, Notes called for redemption become due and payable on the Redemption
Date and at the redemption price, including any premium, plus accrued interest
to the Redemption Date, if any. Upon surrender to the Paying Agent, such Notes
shall be paid at the redemption price, including any premium, plus accrued
interest to the Redemption Date, if any, provided that if the Redemption Date is
after a regular interest payment record date and on or prior to the Interest
Payment Date, the accrued interest shall be payable to the Holder of the
redeemed Notes registered on the relevant record date.
Section 3.05. Deposit of Redemption Price.
On or prior to 10:00 a.m., New York City time, on each
Redemption Date, the Issuers shall have deposited with the Paying Agent in
immediately available funds U.S. legal tender sufficient to pay the redemption
price of and accrued interest on all Notes to be redeemed on that date.
On and after any Redemption Date, if U.S. legal tender
sufficient to pay the redemption price of and accrued interest on Notes called
for redemption shall have been made available in accordance with the preceding
paragraph, the Notes called for redemption will cease to accrue interest and the
only right of the Holders of such Notes will be to receive payment of the
redemption price of and, subject to the first pro-
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viso in Section 3.04, accrued and unpaid interest on such Notes to the
Redemption Date. If any Note called for redemption shall not be so paid,
interest will continue to accrue and be paid, from the Redemption Date until
such redemption payment is made, on the unpaid principal of the Note and any
interest not paid on such unpaid principal, in each case, at the rate and in the
manner provided in the Notes.
Section 3.06. Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Trustee
shall authenticate for a Holder a new Note equal in principal amount to the
unredeemed portion of the Note surrendered.
Section 3.07. Redemption.
(a) Optional Redemption. The Issuers may redeem the Notes that
are redeemable at their option, in whole at any time or in part from time to
time, (i) from and including the Issue Date through to and including July 31,
2000 at a redemption price of 100% of the principal amount thereof plus accrued
and unpaid interest, if any, to the Redemption Date, (ii) from and including
August 1, 2000 through to and including October 31, 2000 at a redemption price
of 101.50% of the principal amount thereof plus accrued and unpaid interest, if
any, to the Redemption Date and (iii) (A) from and including March 15, 2004
through to and including March 14, 2005 at a redemption price equal to 100% of
the principal amount thereof plus a premium equal to one-half of the interest
rate then borne by the Notes, (B) from and including March 15, 2005 through to
and including March 14, 2006 at a redemption price equal to 100% of the
principal amount thereof plus a premium equal to one-third of the interest rate
then borne by Notes, (C) from and including March 15, 2006 through to and
including March 14, 2007 at a redemption price equal to 100% of the principal
amount thereof plus a premium equal to one-sixth of the interest rate then borne
by the Notes and (D) from and including March 15, 2007 through to and including
the Maturity Date at a redemption price equal to 100% of the principal amount
thereof, in each case plus accrued and unpaid interest, if any, to the
Redemption Date.
Except as set forth in paragraph (b) of this Section 3.07, the
Issuers may not redeem the Notes at their option from and including November 1,
2000 through to and including March 14, 2004.
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(b) Redemption with Net Cash Proceeds of Equity Offerings. The
Issuers may redeem up to 35% of the principal amount of the Notes originally
issued under this Indenture, at any time and from time to time from and after
November 1, 2000 but prior to March 15, 2002, at a redemption price equal to
100% of the aggregate principal amount so redeemed plus a premium equal to the
interest rate then borne by the Notes, plus accrued and unpaid interest, if any,
to the Redemption Date, out of the net cash proceeds of one or more Equity
Offerings; provided, that at least 65% of the principal amount of the Notes
originally issued under this Indenture remains outstanding immediately after any
such redemption (it being expressly agreed that for purposes of determining
whether this condition is satisfied, Notes owned by the Issuers or any of their
Affiliates shall be deemed not to be outstanding). In order to effect the
foregoing redemption with the proceeds of any Equity Offering, the Issuers shall
make such redemption not more than 60 days following the closing of any such
Equity Offering.
(c) Mandatory Redemption. Subject to compliance with the terms
of the Senior Credit Facility (provided that no amendment to the Senior Credit
Facility which is entered into after the Issue Date and on or before October 31,
2000 shall have terms which are materially more restrictive with respect to the
rights of Holders under this Section 3.07(c) than the terms of the Senior Credit
Facility as in effect on the Issue Date), if on or before October 31, 2000 any
Issuer or any of its Subsidiaries receives cash proceeds from (x) the issuance
of Capital Stock (other than (A) proceeds of Capital Stock issued to any Issuer
or any Restricted Subsidiary of any Issuer, (B) proceeds from the issuance to
any employee of any Issuer or any Restricted Subsidiary of any Issuer of Common
Stock or options to purchase Common Stock of any Issuer or any Restricted
Subsidiary pursuant to employee stock options and incentive plans in existence
on the Issue Date, (C) the issuance of Capital Stock as consideration for the
acquisition of any Person or any property or assets of any Person in compliance
with the other terms of this Indenture and (D) proceeds from the issuance of
Capital Stock by the Company to any holder of the Company's Capital Stock as of
the Issue Date and from any contribution to the common equity of the Company by
any holder of the Company's Capital Stock as of the Issue Date, not to exceed
$5,000,000 in the aggregate) or (y) the incurrence of any Indebtedness (other
than (A) Permitted Indebtedness, (B) the Attributable Indebtedness in respect of
any Sale and Lease-Back Transaction, (C) any Indebtedness of any Person assumed
by the Issuer or any of its Subsidiaries in connection with the acquisition of
such Person or its property or assets and (D) any In-
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debtedness issued to the transferor of any Person, property or assets as
consideration for the acquisition by any Issuer or its Subsidiaries of such
Person, property or assets), the Issuers shall promptly redeem that principal
amount of Notes redeemable with such net proceeds received at the redemption
prices set forth below (expressed as a percentage of the principal amount
thereof) plus accrued and unpaid interest, if any, to the Redemption Date, if
redeemed during the period indicated below:
Period Percentage
------ ----------
Issue Date through to and including
July 31, 2000 100.000%
August 1, 2000 through to and in- 101.500%
cluding October 31, 2000
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.
The Issuers shall pay the principal of and interest (including
all Additional Interest (as defined in the Registration Rights Agreement) as
provided in the Registration Rights Agreement on the Notes on the dates and in
the manner provided in the Notes and this Indenture. An installment of principal
or interest shall be considered paid on the date it is due if the Trustee or
Paying Agent holds, for the benefit of the Holders, on that date U.S. legal
tender designated for and sufficient to pay such installment. Interest on the
Notes shall be computed as set forth in Exhibit A.
The Issuers shall pay interest on overdue principal (including
post-petition interest in a proceeding under any Bankruptcy Law), and interest
on overdue interest, to the extent lawful, at the rate specified in the Notes.
Section 4.02. Provision of Financial Statements and Other Information.
(a) Commencing with the first fiscal quarter of the Company
ending after the Issue Date, the Issuers will file with the Commission all
information, documents and reports required
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to be filed with the Commission pursuant to Section 13 or 15(d) of the Exchange
Act and will provide the Trustee and the Noteholders with copies of all such
information, documents and reports within 15 days of filing thereof with the
Commission; provided that if the Issuers are not required to file such
information, documents or reports with the Commission, they will nonetheless
continue to furnish such information, documents and reports required to be filed
by issuers subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act to the Trustee and the Noteholders within 15 days of the date on
which filing with the Commission would have been required. The Issuers shall
also comply with the provisions of TIA ss. 314(a). The Trustee shall retain such
reports, information and documents at its Corporate Trust Office and permit any
Noteholder to examine such material upon prior written request at reasonable
times. Except to determine whether the Issuers have complied with the provisions
of this Section 4.02, the Trustee shall not be required to examine or review
such material or any of it and shall not be considered to have had notice,
constructive or otherwise, from anything set forth in such material of any
Default or other fact or event which might require the Trustee to take any
action or give any notice hereunder.
(b) The Issuers will, upon request, provide to any Holder or
any prospective transferee of any such Holder any information concerning the
Issuers (including financial statements) necessary in order to permit such
Holder to sell or transfer Notes in compliance with Rule 144 and Rule 144A under
the Securities Act.
Section 4.03. Waiver of Stay, Extension or Usury Laws.
The Issuers covenant (to the extent that they may lawfully do
so) that they will not at any time insist upon, or plead (as a defense or
otherwise) or in any manner whatsoever claim or take the benefit or advantage
of, any stay or extension law or any usury law or other law which would prohibit
or forgive the Issuers from paying all or any portion of the principal of,
premium, if any, and/or interest on the Notes as contemplated herein, wherever
enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this Indenture; and (to the extent that they may
lawfully do so) the Issuers hereby expressly waive all benefit or advantage of
any such law, and covenant that they will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.
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Section 4.04. Compliance Certificate; Notice of Default; Tax Information.
(a) The Issuers shall deliver to the Trustee, within 120 days
after the end of each fiscal year, an Officers' Certificate (one of the signers
of which shall be the principal executive officer, principal financial officer
or principal accounting officer of each Issuer) stating that a review of the
activities of the Issuers and their Subsidiaries during such fiscal year has
been made under the supervision of the signing Officers with a view to
determining whether the Issuers have kept, observed, performed and fulfilled
their obligations under this Indenture, and further stating, as to each such
Officer signing such certificate, that to the best of his or her knowledge the
Issuers have kept, observed, performed and fulfilled each and every covenant
contained in this Indenture and, in the case of Restricted Payments, listing all
Restricted Payments for such quarter, and are not in default in the performance
or observance of any of the terms, provisions and conditions hereof (or, if a
Default or Event of Default shall have occurred, describing all of such Defaults
or Events of Default of which he or she may have knowledge and what action each
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
are prohibited or if such event has occurred, a description of the event and
what action the Issuers are taking or propose to take with respect thereto.
(b) The Issuers will, 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 Issuers are taking or propose to
take with respect thereto.
(c) The annual financial statements delivered pursuant to
Section 4.02 shall be accompanied by a written report of the Issuers'
independent accountants (who shall be a firm of established national reputation)
that in conducting their audit of such financial statements nothing has come to
their attention that would lead them to believe that any Issuer has violated any
material provisions of Article Four, Five or Six of this Indenture insofar as
they relate to accounting matters 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
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Person for any failure to obtain knowledge of any such violation.
(d) The Issuers shall calculate and deliver to the Trustee all
original issue discount information to be reported by the Trustee to Holders as
required by law.
Section 4.05. Taxes.
The Issuers shall, and shall cause each of their Subsidiaries
to, pay prior to delinquency all material taxes, assessments, and governmental
levies except as contested in good faith and by appropriate proceedings.
Section 4.06. Limitation on Additional Indebtedness.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, incur (as defined) any
Indebtedness (including Acquired Indebtedness); provided that if no Default or
Event of Default shall have occurred and be continuing at the time or as a
consequence of the incurrence of such Indebtedness, the Issuers and any of the
Guarantors may incur Indebtedness (including Acquired Indebtedness) if after
giving effect to the incurrence of such Indebtedness and the receipt and
application of the proceeds thereof, the Company's Consolidated Leverage Ratio
is less than 6.5 to 1 if such Indebtedness is incurred on or before March 15,
2001 and 6.0 to 1 if such Indebtedness is incurred thereafter.
(b) Notwithstanding the foregoing clause (a), the Company and
its Restricted Subsidiaries may incur Permitted Indebtedness. For purposes of
determining compliance with this Section 4.06, in the event that an item of
proposed Indebtedness meets the criteria of more than one of the categories of
Permitted Indebtedness as of the date of incurrence thereof or is entitled to be
incurred pursuant to the first paragraph of this covenant as of the date of
incurrence thereof, the Company shall, in its sole discretion, classify or
reclassify such item of Indebtedness in any manner that complies with this
covenant. Accrual of interest, the accretion of accreted value and the payment
of interest in the form of additional Indebtedness will not be deemed to be an
incurrence of Indebtedness for purposes of this covenant and the payment of
dividends on Disqualified Capital Stock in the form of additional shares of the
same class of Disqualified Capital Stock will not be deemed an issuance of
Disqualified Capital Stock.
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Section 4.07. Limitation on Restricted Payments.
(a) The Company will not make, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, make, any Restricted
Payment, unless:
(1) no Default or Event of Default shall have occurred and be
continuing at the time of or immediately after giving effect to such
Restricted Payment;
(2) immediately after giving pro forma effect to such
Restricted Payment, the Company could incur $1.00 of additional
Indebtedness (other than Permitted Indebtedness) under Section 4.06 of
this Indenture; and
(3) immediately after giving effect to such Restricted
Payment, the aggregate of all Restricted Payments declared or made
after the Issue Date does not exceed the sum of
(a) 100% of the Company's Cumulative EBITDA (or, in
the event that such Cumulative EBITDA shall be a deficit,
minus 100% of such deficit) minus 1.4 times the Company's
Cumulative Consolidated Interest Expense,
(b) 100% of the aggregate net cash proceeds received
by the Company from the issue or sale after the Existing Notes
Issue Date of Capital Stock (other than Disqualified Capital
Stock or Capital Stock of the Company issued to any Subsidiary
of the Company) of the Company or any Indebtedness or other
securities of the Company convertible into or exercisable or
exchangeable for Capital Stock (other than Disqualified
Capital Stock) of the Company which have been so converted,
exercised or exchanged, as the case may be,
(c) without duplication of any amounts included in
clause (3)(b) above, 100% of the aggregate net proceeds
(including the fair market value of Property other than cash)
received by the Company from any equity contribution from a
holder of the Company's Capital Stock (provided that the net
proceeds from the ABRY Equity Contributions shall be excluded
from such calculation and, if applicable, from clause (b)
above, until the Conversion Date), excluding, in the case of
clauses (3)(b) and (c), (i) any net proceeds
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from an Equity Offering to the extent used to redeem the Notes
and (ii) any net proceeds directly or indirectly received in
connection with the Capstar Acquisition, and
(d) without duplication, the sum of
(i) the aggregate amount returned in cash
on or with respect to Investments (other than
Permitted Investments) made subsequent to the
Existing Notes Issue Date whether through interest
payments, principal payments, dividends or other
distributions;
(ii) the net proceeds received by the
Company or any of its Restricted Subsidiaries from
the disposition, retirement or redemption of all or
any portion of such Investments (other than to a
Subsidiary of the Company); and
(iii) upon redesignation of an Unrestricted
Subsidiary as a Restricted Subsidiary, the fair market value
of the net assets of such Subsidiary;
provided, however, that the sum of clauses (d)(i), (ii) and (iii) above
shall not exceed the aggregate amount of all such Investments made
subsequent to the Existing Notes Issue Date.
For purposes of determining under clause (3) above the amount
expended for Restricted Payments, cash distributed shall be valued at the face
amount thereof and Property other than cash shall be valued at its fair market
value.
(b) The provisions of this Section 4.07 shall not prohibit
(1) the payment of any distribution within 60 days after the
date of declaration thereof, if at such date of declaration such
payment would comply with the provisions of this Indenture,
(2) the repurchase, redemption, defeasance or other
acquisition or retirement of any shares of Capital Stock of the Company
or of Indebtedness that is subordinated to the Notes by conversion
into, or by or in exchange for, shares of Capital Stock of the Company
(other than Dis-
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qualified Capital Stock), or out of the net cash proceeds of the
substantially concurrent sale (other than to a Subsidiary of the
Company) of other shares of Capital Stock of the Company (other than
Disqualified Capital Stock),
(3) the redemption, repurchase, defeasance, retirement or
other acquisition of Indebtedness of the Company that is subordinated
to the Notes in exchange for, by conversion into, or out of the net
cash proceeds of a substantially concurrent sale or incurrence of,
Indebtedness of the Company (other than any Indebtedness owed to a
Subsidiary) that is Refinancing Indebtedness,
(4) the retirement of any shares of Disqualified Capital Stock
of the Company by conversion into, or by exchange for, shares of
Disqualified Capital Stock of the Company, or out of the net cash
proceeds of the substantially concurrent sale (other than to a
Subsidiary of the Company) of other shares of Disqualified Capital
Stock of the Company,
(5) the payment of any dividend or distribution to the extent
necessary to permit direct or indirect beneficial owners of shares of
Capital Stock of the Company to pay federal, state or local income tax
liabilities arising from income of the Company and attributable to them
solely as a result of the Company (and any intermediate entity through
which the holder owns such shares) being a limited liability company,
partnership or similar entity for federal income tax purposes
(collectively "Permitted Tax Distributions"),
(6) the repurchase, redemption or other acquisition or
retirement for value of any Capital Stock of the Company or the payment
of a dividend to Holdings to effect the repurchase, redemption or other
acquisition or retirement for value of Holdings' Capital Stock that is
held by any current or former members of the management of the Company
(or any of its Restricted Subsidiaries) pursuant to any management
equity subscription or purchase agreement, members agreement,
securityholders agreement or stock option agreement or similar
agreement, in an aggregate amount not to exceed $2 million in any
fiscal year (which amount shall be increased by the amount of any
proceeds to the Company from (x) without duplication of any amounts
included in clauses 3(b) and (c) of subsection (a) above, sales of
Capital Stock (other than Disqualified Capital Stock) of the Company or
Holdings (which net pro-
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ceeds have been contributed by the Company) to management or other
employees subsequent to the Existing Notes Issue Date and (y) any
"key-man" life insurance policies which are used to make such
redemptions or repurchases); provided, that the cancellation of
Indebtedness owing to the Company from management or other employees of
the Company or any of its Restricted Subsidiaries in connection with a
repurchase of Capital Stock of the Company will not be deemed to
constitute a Restricted Payment under this Indenture,
(7) the making of distributions, loans or advances in an
amount not to exceed $1 million in any calendar year sufficient to
permit Holdings to pay the ordinary operating expenses of Holdings
(including, without limitation, directors' fees, indemnification
obligations, professional fees and expenses) relating to Holdings'
ownership of Capital Stock of the Company,
(8) payments or distributions to Holdings on and after
September 15, 2004 in an amount sufficient to permit Holdings to make
cash interest payments when due to holders of the Senior Discount Notes
in accordance with the terms of the Senior Discount Notes as in effect
on the Existing Notes Issue Date,
(9) [RESERVED]
(10) Investments received in connection with an Asset Sale
that complies with Section 4.09 of this Indenture,
(11) payments or distributions to dissenting stockholders
pursuant to transactions permitted under the terms of this Indenture,
(12) repurchases of Capital Stock deemed to occur upon the
exercise of stock options if such Capital Stock represents a portion of
the exercise price thereof,
(13) payments to enable the Company or Holdings to make
payments to holders of their Capital Stock in lieu of issuance of
fractional shares of their Capital Stock,
(14) payment of principal and interest on funds on the ABRY
Subordinated Debt in accordance with the terms thereof,
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(15) any dividend or distribution made so long as concurrently
therewith a capital contribution in an equal amount is made to the
Company, and
(16) other Restricted Payments in an aggregate amount not to
exceed $5 million.
In calculating the aggregate amount of Restricted Payments
made subsequent to the Issue Date for purposes of clause (3) of subsection (a)
above, amounts expended pursuant to clauses (1), (2), (8) and (15) of the
immediately preceding paragraph shall be included in such calculation.
(c) Not later than the date of making any Restricted Payment,
the Issuers shall deliver to the Trustee an Officers' Certificate stating that
such Restricted Payment is permitted and setting forth the basis upon which the
calculations required by this Section 4.07 were computed, which calculations may
be based upon the Issuers' latest available financial statements, and (other
than with respect to any Restricted Payment permitted under clauses (5), (6) and
(7)) that no Default or Event of Default has occurred and is continuing and no
Default or Event of Default will occur immediately after giving effect to any
such Restricted Payments.
Section 4.08. Limitation on Other Senior Subordinated Indebtedness.
The Company will not, and will not permit any of the
Guarantors to, directly or indirectly, incur, contingently or otherwise, any
Indebtedness (other than the Notes and the Guarantees, as the case may be) that
is both (i) subordinated in right of payment to any Senior Indebtedness of the
Company or Guarantor Senior Indebtedness of any of the Guarantors, as the case
may be, and (ii) senior in right of payment to the Notes and the respective
Guarantee of any such Guarantor, as the case may be. For purposes of this
covenant, Indebtedness is deemed to be senior in right of payment to the Notes
or the Guarantees, as the case may be, if it is not explicitly subordinated in
right of payment to Senior Indebtedness or Guarantor Senior Indebtedness, as the
case may be, at least to the same extent as the Notes and the Guarantees, as the
case may be, are subordinated to such Senior Indebtedness or Guarantor Senior
Indebtedness, as the case may be.
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Section 4.09. Limitation on Certain Asset Sales.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, consummate an Asset Sale unless
(1) the Company or such Restricted Subsidiary, as the case may
be, receives consideration at the time of such sale or other
disposition at least equal to the fair market value of the assets sold
or otherwise disposed of (as determined in good faith by the Board of
Directors of the Company, and evidenced by a Board Resolution);
(2) not less than 75% of the consideration received by the
Company or such Restricted Subsidiary, as the case may be, is in the
form of cash or Cash Equivalents and/or a controlling interest in a
Person whose assets are useful to the Company, or any combination
thereof, except to the extent to which the Company is undertaking a
Permitted Asset Swap; 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 any of its Restricted Subsidiaries (other than
contingent liabilities and liabilities that are by their terms
subordinated to the Notes) that are assumed by the transferee
of any such assets shall be deemed to be cash for purposes of
this clause (2); and
(b) any securities, notes or other obligations
received by the Company or any such Restricted Subsidiary from
such transferee that are promptly converted by the Company or
such Restricted Subsidiary into cash (to the extent of the
cash received), shall be deemed to be cash for purposes of
this clause (2); and
(3) the Asset Sale Proceeds received by the Company or such
Restricted Subsidiary are applied
(a) first, to the extent the Company or any such
Restricted Subsidiary, as the case may be, elects, or is
required, to prepay, repay or purchase indebtedness under any
then existing Senior Indebtedness of the Company or any such
Restricted Subsidiary within 360 days following the receipt of
the Asset Sale Proceeds from any Asset Sale; provided that any
such repayment shall result in a permanent reduction
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of the commitments thereunder in an amount equal to the
principal amount so repaid;
(b) second, to the extent of the balance of Asset
Sale Proceeds after application as described above, to the
extent the Company elects, to an investment in assets
(including Capital Stock or other securities purchased in
connection with the acquisition of Capital Stock or Property
of another Person) used or useful in businesses reasonably
related, ancillary or complementary to the business of the
Company or any such Restricted Subsidiary as conducted on the
Issue Date; provided that such investment occurs within 360
days following receipt of such Asset Sale Proceeds; and
(c) third, if on such 360th day with respect to any
Asset Sale, the Available Asset Sale Proceeds exceed $10
million, the Company shall apply an amount equal to the
Available Asset Sale Proceeds to an offer to repurchase the
Notes and all other pari passu Indebtedness of the Company
containing provisions substantially similar to those set forth
in this Indenture regarding offers to purchase or redeem with
Asset Sale Proceeds, in each case, at a purchase price in cash
equal to 100% of the principal amount thereof plus accrued and
unpaid interest, if any, to the purchase date (an "Excess
Proceeds Offer").
If an Excess Proceeds Offer is not fully subscribed, the
Company may retain the portion of the Available Asset Sale Proceeds not required
to repurchase Notes and such pari passu Indebtedness.
Pending the final application of any Asset Sale Proceeds, the
Company or such Restricted Subsidiary may temporarily reduce Indebtedness under
a revolving credit facility, if any, or otherwise invest such Asset Sale
Proceeds in Cash Equivalents.
(b) If the Company is required to make an Excess Proceeds
Offer, the Company shall within 45 days following the date specified in
subparagraph (a)(3)(c) above (i) cause a notice of the Excess Proceeds Offer to
be sent at least once to the Dow Jones News Service or similar business news
service in the United States and (ii) mail a notice of the Excess Proceeds Offer
to the Trustee and the Holders. Such notice shall be sent by first-class mail,
postage prepaid, to the Trustee and
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to each Noteholder, at the address appearing in the register maintained by the
Registrar of the Notes, and shall state:
(i) that the Excess Proceeds Offer is being made pursuant to
this Section 4.09;
(ii) that such Holders have the right to require the Company
to apply the Available Asset Sale Proceeds to repurchase such Notes at
a purchase price in cash equal to 100% of the principal amount thereof
plus accrued and unpaid interest, if any, to the purchase date which
shall be no earlier than 45 days and not later than 60 days from the
date such notice is mailed (the "Excess Proceeds Payment Date");
(iii) that any Note not tendered or accepted for payment will
continue to accrue interest;
(iv) that any Notes accepted for payment pursuant to the
Excess Proceeds Offer shall cease to accrue interest after the Excess
Proceeds Payment Date;
(v) that Holders accepting the offer to have their Notes
purchased pursuant to an Excess Proceeds Offer will be required to
surrender the Notes, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Note completed, to the Paying Agent at
the address specified in the notice prior to the close of business on
the Business Day preceding the Excess Proceeds Payment Date;
(vi) that Holders will be entitled to withdraw their
acceptance of the Excess Proceeds Offer if the Paying Agent receives,
not later than the close of business on the third Business Day
preceding the Excess Proceeds Payment Date, a facsimile transmission or
letter setting forth the name of the Holder, the principal amount of
the Notes delivered for purchase, and a statement that such Holder is
withdrawing his election to have such Notes purchased;
(vii) that if the aggregate principal amount of Notes
surrendered by Holders exceeds the amount of Excess Proceeds, 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);
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(viii) that Holders whose Notes are being purchased only in part
will be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered, provided that each Note purchased and
each such new Note issued shall be in an original principal amount in
denominations of $1,000 and integral multiples thereof;
(ix) the calculations used in determining the amount of
Available Asset Sale Proceeds to be applied to the purchase of such
Notes;
(x) any other procedures that a Holder must follow to accept
an Excess Proceeds Offer or effect withdrawal of such acceptance; and
(xi) the name and address of the Paying Agent.
On the Excess Proceeds Payment Date, the Issuers shall, to the
extent lawful, (i) accept for payment, on a pro rata basis to the extent
necessary, Notes or portions thereof validly tendered pursuant to the Excess
Proceeds Offer, (ii) deposit with the Paying Agent money sufficient to pay the
purchase price plus accrued and unpaid interest, if any, on the Notes to be
purchased or portions thereof, (iii) deliver or cause to be delivered to the
Trustee Notes so accepted together with an Officers' Certificate stating that
such Notes or portions thereof were accepted for payment by the Issuers in
accordance with the terms of this Section 4.09. The Paying Agent shall promptly
mail to each Holder so accepted payment in an amount equal to the purchase price
for such Notes, and the Issuers shall execute and issue, and the Trustee shall
promptly authenticate and make available for delivery to such Holder, a new Note
equal in principal amount to any unpurchased portion of the Notes surrendered;
provided that each such new Note shall be issued in an original principal amount
in denominations of $1,000 and integral multiples thereof. The Issuers will
publicly announce the results of the Excess Proceeds Offer on the Excess
Proceeds Payment Date.
(c) In the event of the transfer of substantially all of the
Property and assets of the Company and its Restricted Subsidiaries as an
entirety to a Person in a transaction permitted under Section 5.01 of this
Indenture below but which transaction does not constitute a Change of Control,
the successor Person shall be deemed to have sold the properties and assets of
the Issuers and their Restricted Subsidiaries not so transferred for purposes of
this covenant, and shall comply
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with the provisions of this Section 4.09 with respect to such deemed sale as if
it were an Asset Sale.
(d) The Company will comply with the requirements of Rule
14e-1 under the Exchange Act and other securities laws and regulations
thereunder to the extent such laws and regulations are applicable in connection
with the repurchase of Notes pursuant to an Excess Proceeds Offer. To the extent
that the provisions of any securities laws or regulations conflict with this
Section 4.09, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under this
Section 4.09 by virtue thereof.
Section 4.10. Limitation on Transactions with Affiliates.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, enter into or suffer to
exist any transaction or series of related transactions (including, without
limitation, the sale, purchase, exchange or lease of assets, Property or
services) with any Affiliate (each an "Affiliate Transaction") or extend, renew,
waive or otherwise modify the terms of any Affiliate Transaction entered into
prior to the Issue Date unless
(1) such Affiliate Transaction is between or among the Company
and its Restricted Subsidiaries; or
(2) the terms of such Affiliate Transaction are at least as
favorable as the terms which could be obtained by the Company or such
Restricted Subsidiary, as the case may be, in a comparable transaction
made on an arm's-length basis between unaffiliated parties.
In any Affiliate Transaction (or any series of related
Affiliate Transactions which are similar or part of a common plan) involving an
amount or having a fair market value in excess of $2.5 million which is not
permitted under clause (1) above, the Company must obtain a Board Resolution of
the Company certifying that such Affiliate Transaction complies with clause (2)
above. In any Affiliate Transaction (or any series of related Affiliate
Transactions which are similar or part of a common plan) involving an amount or
having a fair market value in excess of $10 million which is not permitted under
clause (1) above, the Company must obtain a favorable written opinion as to the
fairness of such transaction or transactions, as the case may be, from an
Independent Financial Advisor.
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(b) The foregoing provisions will not apply to
(1) any Restricted Payment that is not prohibited by the
provisions described under Section 4.07 of this Indenture,
(2) reasonable fees and compensation paid to, and indemnity
provided on behalf of, officers, Directors, employees or consultants of
the Company or any Restricted Subsidiary of the Company as determined
in good faith by the Company's Board of Directors or senior management,
(3) any agreement as in effect as of the Issue Date or any
amendment thereto or any transaction contemplated thereby (including
pursuant to any amendment thereto) in any replacement agreement thereto
so long as any such amendment or replacement agreement is not more
disadvantageous to the Holders in any material respect than the
original agreement as in effect on the Issue Date,
(4) transactions effected as part of a Qualified
Securitization Transaction,
(5) any employment agreement entered into by the Company or
any of its Restricted Subsidiaries in the ordinary course of business,
and advances to employees for moving, entertainment and travel
expenses, drawing accounts and similar expenditures in the ordinary
course of business,
(6) the existence of, or the performance by the Company or any
of its Restricted Subsidiaries of its obligations under the terms of,
any securityholders agreement (including any registration rights
agreement or purchase agreement related thereto) to which it is a party
as of the Issue Date and any similar agreements which it may enter into
thereafter; provided, however, that the existence of, or the
performance by the Company or any of its Restricted Subsidiaries of
obligations under, any future amendment to any such existing agreement
or under any similar agreement entered into after the Issue Date shall
only be permitted by this clause (6) to the extent that the terms of
any such amendment or new agreement are not otherwise disadvantageous
to the Holders in any material respect,
(7) transactions permitted by, and complying with, the
provisions described under Article 5 of this Indenture below,
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(8) payments of principal and interest on the ABRY
Subordinated Debt in accordance with the terms thereof,
(9) transactions with customers, clients, suppliers, joint
venture partners or purchasers or sellers of goods or services, in each
case in the ordinary course of business (including, without limitation,
pursuant to joint venture agreements) and otherwise in compliance with
the terms of this Indenture which are fair to the Company or its
Restricted Subsidiaries, in the reasonable determination of the Board
of Directors of the Company or the senior management thereof, or are on
terms at least as favorable as might reasonably have been obtained at
such time from an unaffiliated party,
(10) [RESERVED]
(11) transactions pursuant to the ABRY Management Agreement or
pursuant to the terms of any amendment thereto or restatement thereof
which terms are not more disadvantageous to the Holders in any material
respect than the terms of such agreement as in effect on the Issue Date
as determined in good faith by the Board of Directors of the Company
and evidenced by a Board Resolution, and
(12) with regard to the requirement to obtain the opinion of
an Independent Financial Advisor only, the issuance of Capital Stock of
the Company; provided that said issuance has been approved by the Board
of Directors of the Company and the Board Resolution described in the
immediately preceding paragraph has been delivered to the Trustee.
Section 4.11. Limitations on Liens.
The Company will not, and will not permit any of its
Restricted Subsidiaries to, create, incur or otherwise cause or suffer to exist
or become effective any Liens of any kind (other than Permitted Liens) upon any
Property or asset of the Company or any of its Restricted Subsidiaries or any
shares of Capital Stock or Indebtedness of any Restricted Subsidiary of the
Company which owns Property or assets, now owned or hereafter acquired, unless
(1) if such Lien secures Indebtedness which is subordinated to
the Notes, any such Lien shall be subordinated to any Lien granted to
the Holders to the same extent as such Indebtedness is subordinated to
the Notes and
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(2) in all other cases, the Notes are equally and ratably
secured.
Section 4.12. Limitations on Investments
The Company will not, and will not permit any of its
Restricted Subsidiaries to, make any Investment other than
(1) a Permitted Investment or
(2) an Investment that is made after the Issue Date as a
Restricted Payment in compliance with Section 4.07.
Section 4.13. Limitation on Sale and Lease-Back Transactions.
The Company will not, and will not permit any of its
Restricted Subsidiaries to, enter into any Sale and Lease-Back Transaction
unless
(1) the consideration received in such Sale and Lease-Back
Transaction is at least equal to the fair market value of the Property
sold, as determined in good faith by the Board of Directors of the
Company and evidenced by a Board Resolution,
(2) the Company could incur the Attributable Indebtedness in
respect of such Sale and Lease-Back Transaction in compliance with
Section 4.06 and
(3) the transfer of assets in such Sale and Lease-Back
Transaction is permitted by, and the Company or such Restricted
Subsidiary applies the proceeds of such transaction in compliance with
Section 4.09.
Section 4.14. Payments for Consent.
The Company will not, and will not permit any of its
Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any Holder for
or as an 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 agreed to be paid to all Holders which so consent, waive or agree
to amend in the time frame set forth in solicitation documents relating to such
consent, waiver or agreement.
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Section 4.15. Corporate Existence.
Subject to Article 5 hereof, each of the Issuers shall do or
cause to be done all things necessary to preserve and keep in full force and
effect (i) its corporate or limited liability company existence, and the
corporate, partnership or limited liability company or other existence of each
Subsidiary, in accordance with the respective organizational documents (as the
same may be amended from time to time) of each Subsidiary and, within thirty
days of the Issue Date, the material rights (charter and statutory), licenses
and franchises of the Issuers and their Subsidiaries except where the failure to
preserve and keep in full force and effect any such rights, licenses and
franchise shall not have a material adverse effect on the financial condition,
business, operations or prospects of the Issuers and their Subsidiaries taken as
a whole; and provided that the Issuers shall not be required to preserve any
such right, license or franchise, or the corporate, limited liability company,
partnership or other existence of any of Subsidiaries, if the Board of Directors
of the applicable Issuer shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Issuers and their
Subsidiaries, taken as a whole, and that the loss thereof is not adverse in any
material respect to the Holders.
Section 4.16. Change of Control.
(a) Upon the occurrence of a Change of Control, the Issuers
shall be obligated to make an offer to purchase (the "Change of Control Offer")
each Holder's outstanding Notes at a purchase price (the "Change of Control
Purchase Price") equal to 101% of the principal amount thereof plus accrued and
unpaid interest, if any, to the Change of Control Payment Date (as defined) in
accordance with the procedures set forth below.
(b) Within 20 days of the occurrence of a Change of Control,
the Issuers shall (i) cause a notice of the Change of Control Offer to be sent
at least once to the Dow Jones News Service or similar business news service in
the United States and (ii) send by first-class mail, postage prepaid, to the
Trustee and to each Noteholder, at the address appearing in the register
maintained by the Registrar of the Notes, a notice stating:
(1) that the Change of Control Offer is being made pursuant to
this covenant and that all Notes tendered will be accepted for payment;
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(2) the Change of Control Purchase Price and the purchase date
(which shall be a Business Day no earlier than 30 days nor later than
60 days from the date such notice is mailed (the "Change of Control
Payment Date"));
(3) that any Note not tendered will continue to accrue
interest;
(4) that, unless the Issuers default in the payment of the
Change of Control Purchase Price, any Notes accepted for payment
pursuant to the Change of Control Offer shall cease to accrue interest
after the Change of Control Payment Date;
(5) that Holders accepting the offer to have their Notes
purchased pursuant to a Change of Control Offer will be required to
surrender the Notes to the Paying Agent at the address specified in the
notice prior to the close of business on the Business Day preceding the
Change of Control Payment Date;
(6) that Holders will be entitled to withdraw their acceptance
if the Paying Agent receives, not later than the close of business on
the third Business Day preceding the Change of Control Payment Date, a
telegram, telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of the Notes delivered for
purchase, and a statement that such Holder is withdrawing his election
to have such Notes purchased;
(7) that Holders whose Notes are being purchased only in part
will be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered;
(8) any other procedures that a Holder must follow to accept a
Change of Control Offer or effect withdrawal of such acceptance; and
(9) the name and address of the Paying Agent.
On the Change of Control Payment Date, the Issuers shall, to
the extent lawful,
(1) accept for payment Notes or portions thereof properly
tendered pursuant to the Change of Control Offer,
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(2) deposit with the Paying Agent money sufficient to pay the
purchase price of all Notes or portions thereof so tendered, and
(3) deliver or cause to be delivered to the Trustee the Notes
so accepted together with an Officers' Certificate stating the Notes or
portions thereof tendered to the Issuers.
The Paying Agent shall promptly mail to each Holder so accepted payment in an
amount equal to the purchase price for such Notes, and the Issuers shall execute
and issue, and the Trustee shall promptly authenticate and mail to such Holder,
a new Note equal in principal amount to any unpurchased portion of the Notes
surrendered; provided that each such new Note shall be issued in an original
principal amount in denominations of $1,000 and integral multiples thereof.
(c) If the Senior Credit Facility is in effect, or any amounts
are owing thereunder or in respect thereof, at the time of the occurrence of a
Change of Control, prior to the mailing of the notice to Holders described in
Section 4.16(b) above, but in any event within 60 days following any Change of
Control, the Issuers covenant to
(1) repay in full all obligations and terminate all
commitments under or in respect of the Senior Credit Facility and all
other Senior Indebtedness the terms of which require repayment upon a
Change of Control or offer to repay in full all obligations and
terminate all commitments under or in respect of the Senior Credit
Facility and all such Senior Indebtedness and repay the Indebtedness
owed to each such lender who has accepted such offer, or
(2) obtain the requisite consents under the Senior Credit
Facility and all such other Senior Indebtedness to permit the
repurchase of the Notes as described above.
The Issuers must first comply with the covenant described in the preceding
sentence before they shall be required to purchase Notes in the event of a
Change of Control; provided that the Issuers' failure to comply with the
covenant described in the preceding sentence constitutes an Event of Default
described in clause (3) under Section 6.01 if not cured within 30 days after the
notice required by such clause.
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(d) The Issuers will comply with the requirements of Rule
14e-1 under the Exchange Act and any other securities laws and regulations
thereunder to the extent such laws and regulations are applicable in connection
with the repurchase of Notes pursuant to a Change of Control Offer. To the
extent that the provisions of any securities laws or regulations conflict with
this Section 4.16, the Issuers shall comply with the applicable securities laws
and regulations and shall not be deemed to have breached their obligations under
this Section 4.16 by virtue thereof.
Section 4.17. Maintenance of Office or Agency.
The Issuers shall maintain an office or agency in the Borough
of Manhattan, The City of New York where Notes may be surrendered for
registration of transfer or exchange or for presentation for payment and where
notices and demands to or upon the Issuers in respect of the Notes and this
Indenture may be served. The Issuers 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 Issuers 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
address of the Trustee as set forth in Section 12.02.
The Issuers 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.
The Issuers shall give prompt written notice to the Trustee of such designation
or rescission and of any change in the location of any such other office or
agency.
The Issuers hereby initially designate the offices of State
Street Bank and Trust Company, N.A. at 61 Broadway, New York, New York 10006 as
such office of the Issuers.
Section 4.18. Limitation on Dividend and Other Payment Restrictions Affecting
Restricted Subsidiaries.
The Company will not, and will 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 of the Company to
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(1) (a) pay dividends or make any other distributions to the
Company or any Restricted Subsidiary of the Company
(i) on its Capital Stock or
(ii) with respect to any other interest or
participation in, or measured by, its profits or
(b) repay any Indebtedness or any other obligation owed to the
Company or any Restricted Subsidiary of the Company,
(2) make loans or advances or capital contributions to the
Company or any of its Restricted Subsidiaries or
(3) 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
(1) encumbrances or restrictions existing on the Issue Date to
the extent and in the manner such encumbrances and restrictions are in
effect on the Issue Date,
(2) (a) this Indenture, the Notes and the related Guarantees,
(b) the Senior Credit Facility and (c) the indenture governing the
Existing Notes and the related guarantees,
(3) applicable law or applicable rules, regulations or orders,
(4) any instrument governing Acquired Indebtedness, which
encumbrance or restriction is not applicable to any Person, or the
Properties or assets of any Person, other than the Person, or the
Property or assets of the Person (including any Subsidiary of the
Person), so acquired,
(5) customary non-assignment provisions in leases or other
agreements entered in the ordinary course of business,
(6) Refinancing Indebtedness; provided that such restrictions
are not materially more restrictive, when taken as a whole, than those
contained in the agreements govern-
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ing the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded,
(7) customary restrictions in security agreements or mortgages
securing Indebtedness of the Issuers or a Restricted Subsidiary to the
extent such restrictions restrict the transfer of the Property subject
to such security agreements and mortgages,
(8) customary restrictions pursuant to an agreement that has
been entered into for the sale or disposition of Capital Stock or
assets permitted under this Indenture,
(9) restrictions on the transfer of assets subject to any Lien
permitted under this Indenture imposed by the holder of such Lien,
(10) any agreement or instrument governing Capital Stock of
any Person that is acquired; provided that no such restriction is
created in contemplation of the acquisition of such Capital Stock,
(11) Indebtedness or other contractual requirements of a
Securitization Entity in connection with a Qualified Securitization
Transaction; provided that such restrictions apply only to such
Securitization Entity,
(12) Purchase Money Indebtedness incurred to acquire Property
in the ordinary course of business which Indebtedness imposes
restrictions regarding transfer of the Property acquired,
(13) the terms of any Indebtedness permitted by this Indenture
to be incurred by any Guarantor,
(14) any agreement or instrument governing Indebtedness
(whether or not outstanding) of Foreign Restricted Subsidiaries of the
Company incurred in reliance on clauses (8) and (16) of the definition
of Permitted Indebtedness, or
(15) restrictions on cash or other deposits or net worth
imposed by customers under contracts entered into in the ordinary
course of business.
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Section 4.19. Limitation on Conduct of Business.
The Company and its Restricted Subsidiaries will not engage in
any businesses which are not reasonably similar, ancillary, complementary or
related to the businesses in which the Company and its Restricted Subsidiaries
are engaged in on the Issue Date except to such extent as would not be material
to the Company and its Restricted Subsidiaries, taken as a whole.
Section 4.20. Compliance with Laws.
The Issuers shall comply, and shall cause each of their
respective Subsidiaries to comply, with all applicable statutes, rules,
regulations, orders and restrictions of the United States of America, all states
and municipalities thereof, and of any governmental department, commission,
board, regulatory authority, bureau, agency and instrumentality of the
foregoing, in respect of the conduct of their respective businesses and the
ownership of their respective properties, except for such noncompliances as
would not in the aggregate have a material adverse effect on the financial
condition or results of operations of the Issuers and their Subsidiaries taken
as a whole.
Section 4.21. Limitation on Preferred Stock of Restricted Subsidiaries.
The Company will not permit any of its Restricted Subsidiaries
to issue any Preferred Stock (except Preferred Stock issued to the Company or a
Restricted Subsidiary of the Company) or permit any Person (other than the
Company or a Restricted Subsidiary of the Company) to hold any such Preferred
Stock unless such Restricted Subsidiary would be entitled to incur or assume
Indebtedness under Section 4.06 (other than Permitted Indebtedness) in the
aggregate principal amount equal to the aggregate liquidation value of the
Preferred Stock to be issued.
Section 4.22. Limitation on Creation of Subsidiaries.
The Company will not create or acquire, and will not permit
any of its Restricted Subsidiaries to create or acquire, any Subsidiary other
than
(1) a Restricted Subsidiary existing as of the Issue Date,
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(2) a Restricted Subsidiary that is acquired or created after
the Issue Date, provided, however, that each Restricted Subsidiary
(other than any Foreign Restricted Subsidiary or Finance Corp.)
acquired or created pursuant to this clause (2) shall have executed a
Guarantee, satisfactory in form and substance to the Trustee (and with
such documentation relating thereto as the Trustee shall require,
including, without limitation a supplement or amendment to this
Indenture and Opinions of Counsel as to the enforceability of such
Guarantee), pursuant to which such Restricted Subsidiary will become a
Guarantor, or
(3) an Unrestricted Subsidiary.
Section 4.23. Maintenance of Properties and Insurance.
(a) Each Issuer shall cause all material properties owned by
or leased by it or any of its Subsidiaries used or useful to the conduct of such
Issuer's business or the business of any of its Subsidiaries to be maintained
and kept in normal condition, repair and working order and supplied with all
necessary equipment and shall cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in its judgment may
be necessary, so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
nothing in this Section 4.23 shall prevent an Issuer or any of its Subsidiaries
from discontinuing the use, operation or maintenance of any of such properties,
or disposing of any of them, if such discontinuance or disposal is, in the
judgment of the Board of Directors of such Issuer or of the Board of Directors
of any Subsidiary of such Issuer concerned, or of an officer (or other agent
employed by such Issuer or of any of its Subsidiaries) of such Issuer or any of
its Subsidiaries having managerial responsibility for any such property,
desirable in the conduct of the business of such Issuer or any Subsidiary of
such Issuer, and if such discontinuance or disposal is not adverse in any
material respect to the Holders.
(b) The Issuers shall maintain, and shall cause their
respective Subsidiaries to maintain, insurance with responsible carriers against
such risks and in such amounts, and with such deductibles, retentions,
self-insured amounts and co-insurance provisions, as are customarily carried by
similar businesses of similar size, including property and casualty loss,
workers' compensation and interruption of business insurance. The Issuers shall
provide, and shall cause their respective Subsidiaries to provide, an Officers'
Certificate as to
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compliance with the foregoing requirements to the Trustee prior to the
anniversary or renewal date of each such policy, together with satisfactory
evidence of such insurance, which certificate shall expressly state such
expiration date for each policy listed.
Section 4.24. Pending ABRY Equity Contribution.
The Company shall have received the proceeds from the Pending
ABRY Equity Contribution on or before February 10, 2000.
ARTICLE 5
SUCCESSOR CORPORATION
Section 5.01. Limitation on Consolidation Merger and Sale of Assets.
The Company will not consolidate with, merge with or into, or
sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of the assets of the Company (as an entirety or substantially
as an entirety in one transaction or a series of related transactions), to any
Person unless:
(1) the Company shall be the continuing Person, or the Person
(if other than the Company) formed by such consolidation or into which
the Company is merged or to which the Properties and assets of the
Company are sold, assigned, transferred, leased, conveyed or otherwise
disposed of shall be a corporation, partnership, trust or a limited
liability company organized and existing under the laws of the United
States or any State thereof or the District of Columbia and shall
expressly assume, by a supplemental indenture, executed and delivered
to the Trustee, in form satisfactory to the Trustee, all of the
obligations of the Company under this Indenture and the Notes, and the
obligations thereunder shall remain in full force and effect; provided
that if at any time the Company or such successor Person is a limited
liability company, partnership or trust there shall be a co-issuer of
the Notes that is a Restricted Subsidiary of the Company and that is a
corporation organized and existing under the laws of the United States
or any State thereof or the District of Columbia;
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(2) immediately before and immediately after giving effect to
such transaction, no Default or Event of Default shall have occurred
and be continuing; and
(3) immediately after giving effect to such transaction on a
pro forma basis the Company or such Person could incur at least $1.00
of additional Indebtedness (other than Permitted Indebtedness) under
Section 4.06; provided that the Company may merge into any Guarantor
without complying with this clause (3).
In connection with any consolidation, merger or transfer of
assets contemplated by this Section 5.01, the Company shall deliver, or cause to
be delivered, to the Trustee, in form and substance reasonably satisfactory to
the Trustee, an Officers' Certificate and an Opinion of Counsel, each stating
that such consolidation, merger or transfer and the supplemental indenture in
respect thereto comply with this provision and that all conditions precedent
herein provided for relating to such transaction or transactions have been
complied with.
For purposes of the foregoing, the transfer (by lease,
assignment, sale or otherwise, in a single transaction or series of
transactions) of all or substantially all of the properties or assets of one or
more Restricted Subsidiaries of the Company the Capital Stock of which
constitutes all or substantially all of the properties and assets of the
Company, shall be deemed to be the transfer of all or substantially all of the
properties and assets of the Company.
Notwithstanding the foregoing, the Company may merge or
consolidate with or transfer substantially all of its assets to an Affiliate
that has no significant assets or liabilities and was formed solely for the
purpose of changing the jurisdiction of organization of the Company or the form
of organization of the Company so long as the amount of Indebtedness of the
Company and its Restricted Subsidiaries is not increased thereby and that the
successor assumes all obligations of the Company under this Indenture, the Notes
and the Registration Rights Agreement.
Section 5.02. Successor Person Substituted.
Upon any consolidation, merger, conveyance or any transfer of
all or substantially all of the assets of the Company in accordance with Section
5.01 above, the successor entity formed by such consolidation or into which the
Company is merged or to which such transfer is made shall succeed to, and
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be substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor entity had been named
as the Company herein, and thereafter the predecessor entity shall be relieved
of all obligations and covenants under this Indenture and the Notes.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
An "Event of Default" occurs if
(a) there is a default in the payment of any principal of, or
premium, if any, on the Notes when the same becomes due and payable at
maturity, upon acceleration, redemption or otherwise, whether or not
such payment is prohibited by the provisions of Article 11 hereof or
there is a default in the payment of any conversion fee or cancellation
fee under the Purchase Agreement when the same becomes due and payable
in accordance with the terms and conditions of the Purchase Agreement;
(b) there is a default in the payment of any interest on any
Note when the same becomes due and payable and the default continues
for a period of 30 calendar days, whether or not such payment is
prohibited by the provisions of Article 11 hereof;
(c) there is a default by any Issuer or any Restricted
Subsidiary in the observance or performance of any other covenant in
the Notes or this Indenture for 30 calendar days after written notice
from the Trustee or the holders of not less than 25% in aggregate
principal amount of the Notes then outstanding (except in the case of a
default with respect to Sections 4.16 or 5.01 which shall constitute an
Event of Default with such notice requirement but without such passage
of time requirement);
(d) there is a failure to pay at final maturity (after giving
effect to any applicable grace period) any Indebtedness of the Company
or any Restricted Subsidiary thereof (other than a Securitization
Entity), or the acceleration of any such Indebtedness, which
acceleration shall not be rescinded or annulled within 20 days after
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written notice to the Company by the Trustee or any Holder, if the
aggregate amount of such Indebtedness, together with the amount of any
other such Indebtedness in default for failure to pay or which has been
accelerated, aggregates $5 million or more at any time;
(e) any final judgment or judgments which can no longer be
appealed for the payment of money in excess of $5 million (excluding
amounts covered by insurance for which coverage is not being challenged
or denied unless the Company is contesting such challenge or denial in
good faith) shall be rendered against the Company or any Restricted
Subsidiary thereof, and shall not be discharged for any period of 60
consecutive calendar days during which a stay of enforcement shall not
be in effect;
(f) any Issuer or any Significant Subsidiary pursuant to or
within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief
against it in an involuntary case,
(C) consents to the appointment of a Custodian of it
or for all or substantially all of its Property, or
(D) makes a general assignment for the benefit of its
creditors, or
(E) generally is not able to pay its debts as they
become due;
(g) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against any Issuer or any
Significant Subsidiary in an involuntary case,
(B) appoints a Custodian of any Issuer or any
Significant Subsidiary or for all or substantially all of the
Property of any Issuer or any Significant Subsidiary, or
(C) orders the liquidation of any Issuer or any
Significant Subsidiary,
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and the order or decree remains unstayed and in effect for 60 days; or
(h) any Guarantee of a Significant Subsidiary ceases to be in
full force and effect or any Guarantee of a Significant Subsidiary is
declared to be null and void and unenforceable or any Guarantee of a
Significant Subsidiary is found to be invalid or any of the Guarantors
denies its liability under its Guarantee (other than by reason of
release of a Guarantor in accordance with the terms of this Indenture).
The term "Bankruptcy Law" means Title 11, U.S. Code or any
similar Federal or state law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.
The Trustee may withhold notice to the Holders of any Default
(except in payment of principal or premium, if any, or interest on the Notes) if
the Trustee considers it to be in the best interest of the Holders to do so.
Section 6.02. Acceleration.
If an Event of Default (other than an Event of Default of the
type described in Section 6.01(f) or (g)) shall have occurred and be continuing,
then the Trustee or the holders of not less than 25% in aggregate principal
amount of the Notes then outstanding may declare to be immediately due and
payable the entire principal amount of all the Notes then outstanding plus
accrued interest to the date of acceleration and (1) the same shall become
immediately due and payable or (2) if there are any amounts outstanding under
the Senior Credit Facility, shall become immediately due and payable upon the
first to occur of an acceleration under the Senior Credit Facility or five
Business Days after receipt by the Issuers and the representative under the
Senior Credit Facility of a notice of acceleration; provided, however, that
after such acceleration but before a judgment or decree based on acceleration is
obtained by the Trustee, the holders of a majority in aggregate principal amount
of outstanding Notes may, under certain circumstances, rescind and annul such
acceleration if
(1) all Events of Default, other than nonpayment of principal,
premium, if any, or interest that has become due solely because of the
acceleration, have been cured or waived as provided in this Indenture,
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(2) to the extent the payment of such interest is lawful,
interest on overdue installments of interest and overdue principal,
which has become due otherwise than by such declaration of
acceleration, has been paid,
(3) the Issuers have paid the Trustee its reasonable
compensation and reimbursed the Trustee for its expenses, disbursements
and advances and
(4) in the event of the cure or waiver of an Event of Default
of the type described in Section 6.01(f) or (g) above, the Trustee
shall have received an Officers' Certificate and an Opinion of Counsel
that such Event of Default has been cured or waived.
No such rescission shall affect any subsequent Default or impair any right
consequent thereto. In case an Event of Default of the type described in Section
6.01(f) or (g) above shall occur, the principal, premium and interest amount
with respect to all of the Notes shall be due and payable immediately without
any declaration or other act on the part of the Trustee or the Noteholders.
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of, or premium, if any, and interest on the Notes or to
enforce the performance of any provision of the Notes, the obligations set forth
in the Guarantees or this Indenture and may take any necessary action requested
of it as Trustee to settle, compromise, adjust or otherwise conclude any
proceedings to which it is a party.
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 Noteholder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
Section 6.04. Waiver of Past Defaults and Events of
Default.
Subject to Sections 6.02, 6.07 and 8.02 hereof, the Holders of
a majority in principal amount of the Notes then
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outstanding shall have the right to waive past Defaults under this Indenture
except a Default in the payment of the principal of, or interest or premium, if
any, on any Note, which cannot be waived without the consent of the Holder of
such Notes or in respect of a covenant or a provision which cannot be modified
or amended without the consent of all Holders. 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 Event of Default or
impair any right consequent thereto.
Section 6.05. Control by Majority.
The Holders of a majority in principal amount of the
outstanding Notes have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee by this Indenture. The Trustee,
however, may refuse to follow any direction that conflicts with law or this
Indenture or that the Trustee determines may be unduly prejudicial to the rights
of another Noteholder not taking part in such direction, and the Trustee shall
have the right to decline to follow any such direction if the Trustee, being
advised by counsel, determines that the action so directed may not lawfully be
taken or if the Trustee in good faith shall, by a Trust Officer, determine that
the proceedings so directed may involve it in personal liability; provided that
the Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction.
Section 6.06. Limitation on Suits.
Subject to Section 6.07 below, no Holder has any right to
institute any proceeding with respect to this Indenture or any remedy thereunder
unless:
(1) the Holders of at least 25% in aggregate principal amount
of the outstanding Notes make a written request to the Trustee to
pursue the remedy;
(2) such Holder or Holders offer to the Trustee indemnity
reasonably satisfactory to the Trustee against any loss, liability or
expense which may be incurred in compliance with such request;
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(3) the Trustee fails to institute such proceeding within 60
calendar days after receipt of such notice and the offer of indemnity;
and
(4) the Trustee has not received directions inconsistent with
such written request during such 60-day period by the Holders of a
majority in aggregate principal amount of the outstanding Notes.
A Noteholder may not use this Indenture to prejudice the
rights of another Noteholder or to obtain a preference or priority over another
Noteholder.
Section 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the
right of any Holder to receive payment of principal of, or premium, if any, or
accrued interest of any Note held by such Holder on or after the respective due
dates expressed in such Note, or to bring suit for the enforcement of any such
payment on or after such respective dates, is absolute and unconditional and
shall not be impaired or affected without the consent of the Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal, premium or
interest specified in Section 6.01(a), (b) or (c) hereof occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against any or all of the Issuers and the Guarantors for the
whole amount of unpaid principal and accrued interest remaining unpaid, together
with interest on overdue principal and, to the extent that payment of such
interest is lawful, interest on overdue installments of interest, in each case
at the rate then borne by the Notes, and such further amounts as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
Section 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Noteholders allowed in any judicial proceedings relative to the Issuers (or
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any other obligor upon the Notes), its creditors or its Property and shall be
entitled and empowered to collect and receive any monies or other Property
payable or deliverable on any such claims and to distribute the same after
deduction of its charges and expenses to the extent that any such charges and
expenses are not paid out of the estate in any such proceedings and any
custodian in any such judicial proceeding is hereby authorized by each
Noteholder 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
Noteholders, 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.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any
Noteholder any plan or reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof, or to authorize the
Trustee to vote in respect of the claim of any Noteholder in any such
proceedings.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article 6,
it shall pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 7.07
hereof;
SECOND: to Noteholders for amounts due and unpaid on the Notes
for principal, premium, if any, and interest as to each, ratably,
without preference or priority of any kind, according to the amounts
due and payable on the Notes; and
THIRD: to the Issuers or, to the extent the Trustee collects
any amounts from any Guarantor, to such Guarantor.
The Trustee may fix a record date and payment date for any
payment to Noteholders 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
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any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant. This Section 6.11 does not apply to a suit by the
Trustee, a suit by a Holder pursuant to Section 6.07 hereof or a suit by Holders
of more than 10% in principal amount of the Notes then outstanding.
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default known to the Trustee has occurred
and is continuing, the Trustee shall exercise such 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 known
to the Trustee:
(1) The Trustee need perform only those duties that are
specifically set forth in this Indenture and no others.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture but, in the case of any such certificates or opinions
which by any provision hereof are specifically required to be furnished
to the Trustee, the Trustee shall be under a duty to examine the same
to determine whether or not they conform to the requirements of this
Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
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(1) This paragraph does not limit the effect of paragraph (b)
of this Section 7.01.
(2) The Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Sections 6.02, 6.04 and 6.05 hereof.
(4) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its rights or powers if it
determines in the exercise of its reasonable discretion that repayment
of such funds or adequate indemnity satisfactory to it against such
risk or liability is not reasonably assured to it.
(d) The Trustee is not under any obligation to exercise any of
its rights or powers at the request or direction of any of the Holders unless
such Holders shall have offered to the Trustee indemnity or security
satisfactory to it in its reasonable discretion against any loss, liability,
expense or fee.
(e) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Issuers.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by the law.
(f) The Trustee shall not be deemed to have knowledge of any
Default or fact or event which might require the Trustee to take any action or
give any notice unless one of its Trust Officers has actual knowledge thereof.
(g) The Trustee is also being appointed, and may serve
contemporaneously with its service hereunder, as Trustee under the Senior
Discount Notes Indenture and shall not be considered to be conflicted in its
duties under either the Senior Discount Notes Indenture or this Indenture by
reason of its acting as trustee under the other. After an Event of Default (as
defined in the respective Indenture) under either the Senior Discount Notes
Indenture or this Indenture, and in order that it might not be conflicted in the
performance of its du-
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ties under either Indenture, the Trustee shall resign as trustee under one of
the Indentures; provided, however, that until the appointment of a successor
Trustee, the Trustee shall not be considered to have violated the standard set
forth in Section 7.01(a) hereof by continuing to act as Trustee under both the
Senior Discount Notes Indenture and this Indenture if it separates the
performance of its discretionary duties under the Senior Discount Notes
Indenture and this Indenture within its corporate trust department and retains
separate counsel for itself as trustee under each of such Indentures.
(h) Whether or not therein expressly so provided, paragraphs
(a), (b), (c), (d), (e), (f) and (g) of this Section 7.01 shall govern every
provision of this Indenture that in any way relates to the Trustee.
Section 7.02. Rights of Trustee.
Subject to Section 7.01 hereof:
(1) The Trustee may rely on any document reasonably believed
by it to be genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter stated in
the document.
(2) Before the Trustee acts or refrains from acting with
respect to any matters contemplated by this Indenture or the Notes it
may require an Officers' Certificate or an Opinion of Counsel, or both,
which shall conform to the provisions of Section 12.05 hereof. The
Trustee shall be protected and shall not be liable for any action it
takes or omits to take in good faith in reliance on such certificate or
opinion.
(3) The Trustee may act through Agents and shall not be
responsible for the misconduct or negligence of any agent so long as
the appointment of such agent was made with due care.
(4) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it reasonably believes to be
authorized or within its rights or powers.
(5) The Trustee may consult with counsel of its selection, and
the advice or opinion of such counsel as to matters of law shall be
full and complete authorization and protection from liability in
respect of any action
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taken, omitted or suffered by it hereunder in good faith and in
accordance with the advice or opinion of such counsel.
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 make loans to, accept deposits from,
perform services for or otherwise deal with the Issuers, or any Affiliates
thereof, with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights. The Trustee, however, shall be subject to
Sections 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 Issuers' use of the proceeds from the sale of
Notes or any money paid to the Issuers pursuant to the terms of this Indenture
and it shall not be responsible for any statement in the Notes other than its
certificate of authentication.
Section 7.05. Notice of Defaults.
If a Default occurs and is continuing and if it is known to
the Trustee, the Trustee shall mail to each Noteholder notice of the Default
within 30 days after it occurs. Except in the case of a Default in payment of
the principal of, or premium, if any, or interest on any Note the Trustee may
withhold the notice if and so long as the board of directors of the Trustee, the
executive committee or any trust committee of such board and/or its Trust
Officers in good faith determine(s) that withholding the notice is in the
interests of the Noteholders.
Section 7.06. Reports by Trustee to Holders.
If required by TIA Section 313(a), within 60 days after May 15
of any year, commencing the May 15 following the date of this Indenture, the
Trustee shall mail to each Noteholder a brief report dated as of such May 15
that complies with TIA Section 313(a). The Trustee also shall comply with TIA
Section 313(b)(2). The Trustee shall also transmit by mail all reports as
required by TIA Section 313(c) and TIA Section 313(d).
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Reports pursuant to this Section 7.06 shall be transmitted by
mail:
(1) to all registered Holders, as the names and addresses of
such Holders appear on the Registrar's books; and
(2) to such Holder as have, within the two years preceding
such transmission, filed their names and addresses with the Trustee for
that purpose.
A copy of each report at the time of its mailing to
Noteholders shall be filed with the Commission and each stock exchange on which
the Notes are listed. The Issuers shall promptly notify the Trustee when the
Notes are listed on any stock exchange.
Section 7.07. Compensation and Indemnity.
The Issuers shall pay to the Trustee from time to time such
compensation as shall be agreed in writing between the Issuers and the Trustee
for its services hereunder (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust). The Issuers shall reimburse the Trustee upon request for all reasonable
disbursements, expenses and advances incurred or made by it in connection with
its duties under this Indenture, including the reasonable compensation,
disbursements and expenses of the Trustee's agents and counsel.
The Issuers shall indemnify each of the Trustee and its
officers, directors, employees and agents and any predecessor Trustee and its
officers, directors, employees and agents for, and hold each of them harmless
against, any and all loss, damage, claim, liability or expense, including taxes
(other than taxes based on the income of the Trustee) incurred by any of them in
connection with the acceptance or performance of its duties under this Indenture
including the reasonable costs and expenses of defending themselves against any
claim or liability in connection with the exercise or performance of any of the
powers or duties of the Trustee hereunder (including, without limitation,
settlement costs). The Trustee shall notify the Issuers in writing promptly of
any claim asserted against the Trustee or any such officer, director, employee
or agent for which any of them may seek indemnity. However, the failure by the
Trustee to so notify the Issuers shall not relieve the Issuers of their
obligations hereunder except to the extent the Issuers are prejudiced thereby.
This indemnity shall survive
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the termination of this Indenture, final payment of the Notes, and resignation
or removal of the Trustee.
Notwithstanding the foregoing, the Issuers need not reimburse
the Trustee or any such officer, director, employee or agent for any expense or
indemnify any of them against any loss or liability incurred by the Trustee or
any such officer, director, employee or agent through its negligence, willful
misconduct or bad faith. To secure the payment obligations of the Issuers in
this Section 7.07, the Trustee shall have a lien prior to the Notes on all money
or Property held or collected by the Trustee except such money or Property held
in trust to pay principal of and interest on particular Notes.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(g) or (h) hereof occurs, the expenses
and the compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
For purposes of this Section 7.07, the term "Trustee" shall
include any trustee appointed pursuant to Article 9.
Section 7.08. Replacement of Trustee.
The Trustee may resign by so notifying the Issuers in writing.
The Holders of a majority in principal amount of the outstanding Notes may
remove the Trustee by notifying the removed Trustee in writing and may appoint a
successor Trustee with the Issuers' written consent which consent shall not be
unreasonably withheld. The Issuers may remove the Trustee at its election if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of the
Trustee or its Property; or
(4) the Trustee otherwise 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 Issuers shall promptly appoint a
successor Trustee.
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If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Issuers or the holders of a majority in principal amount of the outstanding
Notes may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee fails to comply with Section 7.10 hereof, any
Noteholder 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 Issuers. Immediately following
such delivery, the retiring Trustee shall, subject to its rights under Section
7.07 hereof, transfer all property held by it as Trustee to the successor
Trustee, the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have all the rights, powers and
duties of the Trustee under this Indenture. A successor Trustee shall mail
notice of its succession to each Noteholder. Notwithstanding replacement of the
Trustee pursuant to this Section 7.08, the Issuers' obligations under Section
7.07 hereof shall continue for the benefit of the retiring Trustee.
Section 7.09. Successor Trustee by Consolidation, Merger or Conversion.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust assets to, another
corporation, subject to Section 7.10 hereof, the successor corporation without
any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1), (2) and (5) in every respect. The Trustee
shall have a combined capital and surplus of at least $100,000,000 as set forth
in its most recent published annual report of condition. The Trustee shall
comply with TIA Section 310(b), including the provision in Section 310(b)(1).
The provisions of TIA Section 310 shall apply to the Issuers as obligors of the
Notes.
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Section 7.11. Preferential Collection of Claims Against Issuers.
The Trustee shall comply with TIA Section 311(a), excluding
any creditor relationship listed in TIA Section 311 (b). A Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the extent
indicated therein. The provisions of TIA Section 311 shall apply to the Issuers
as obligors of the Notes.
Section 7.12. Paying Agents.
The Issuers shall cause each Paying Agent other than the
Trustee to execute and deliver to it and the Trustee an instrument in which such
agent shall agree with the Trustee, subject to the provisions of this Section
7.12:
(A) that it will hold all sums held by it as agent for the
payment of principal of, or premium, if any, or interest on, the Notes
(whether such sums have been paid to it by the Issuers or by any
obligor on the Notes) in trust for the benefit of Holders or the
Trustee;
(B) that it will at any time during the continuance of any
Event of Default, upon written request from the Trustee, deliver to the
Trustee all sums so held in trust by it together with a full accounting
thereof; and
(C) that it will give the Trustee written notice within three
(3) Business Days of any failure of the Issuers (or by any other
obligor on the Notes) in the payment of any installment of the
principal of, premium, if any, or interest on, the Notes when the same
shall be due and payable.
ARTICLE 8
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 8.01. Without Consent of Holders.
The Issuers and the Guarantors, when authorized by a Board
Resolution, and the Trustee may amend or supplement this Indenture or the Notes
without notice to or consent of any Noteholder:
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(1) to comply with Section 5.01 hereof;
(2) to provide for uncertificated Notes in addition to or in
place of Certificated Notes;
(3) to comply with any requirements of the Commission under
the TIA;
(4) to cure any ambiguity, defect or inconsistency, or to make
any other change that does not, in the opinion of the Trustee,
materially and adversely affect the rights of any Noteholder;
(5) add Guarantors with respect to the Notes; or
(6) release Guarantors when permitted by this Indenture.
The Trustee is hereby authorized to join with the Issuers and
the Guarantors in the execution of any supplemental indenture authorized or
permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations which may be therein contained, but the Trustee
shall not be obligated to enter into any such supplemental indenture which
adversely affects its own rights, duties or immunities under this Indenture.
Section 8.02. With Consent of Holders.
The Issuers, the Guarantors and the Trustee may modify or
supplement this Indenture or the Notes with the written consent of the Holders
of not less than a majority in principal amount of the outstanding Notes without
notice to any Noteholder. The Holders of not less than a majority in aggregate
principal amount of the outstanding Notes may waive compliance in a particular
instance by the Issuers and the Guarantors with any provision of this Indenture
or the Notes without notice to any Noteholder. Subject to Section 8.04, without
the consent of each Noteholder affected, however, an amendment, supplement or
waiver, including a waiver pursuant to Section 6.04, may not:
(1) reduce the amount of Notes whose Holders must consent to
an amendment, supplement or waiver to this Indenture or the Notes;
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(2) reduce the rate of or change the time for payment of
interest (including Additional Interest (as defined in the Registration
Rights Agreement)) on any Note;
(3) reduce the principal of, or premium on, or change the
stated maturity, of any Note or change the date on which any Notes may
be subject to redemption or repurchase or reduce the redemption or
repurchase price therefor;
(4) make any Note payable in money other than that stated in
the Note or change the place of payment from New York, New York;
(5) waive a Default in the payment of the principal of, or
interest on, or any redemption payment with respect to, any Note;
(6) make any changes in Sections 6.04 or 6.07 hereof or this
sentence of Section 8.02;
(7) amend, change or modify in any material respect, the
obligation of the Issuers to make and consummate a Change of Control
Offer in the event of a Change of Control or, make and consummate an
Excess Proceeds Offer with respect to any Asset Sale that has been
consummated or modify any of the provisions or definitions with respect
thereto;
(8) modify or change any provision of this Indenture or the
related definitions affecting the subordination or ranking of the Notes
or any Guarantee in a manner which adversely affects the Holders; or
(9) release any Guarantor other than Holdings from any of its
obligations under its Guarantee or this Indenture otherwise than in
accordance with the terms of this Indenture.
After an amendment, supplement or waiver under this Section
8.02 becomes effective, the Issuers shall mail to the Holders a notice briefly
describing the amendment, supplement or waiver.
Upon the request of the Issuers, accompanied by a Board
Resolution authorizing the execution of any such supplemental indenture, and
upon the receipt by the Trustee of evidence reasonably satisfactory to the
Trustee of the consent of
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the Noteholders as aforesaid and upon receipt by the Trustee of the documents
described in Section 8.06 hereof, the Trustee shall join with the Issuers and
the Guarantors in the execution of such supplemental indenture unless such
supplemental indenture affects the Trustee's own rights, duties or immunities
under this Indenture, in which case the Trustee may in its discretion, but shall
not be obligated to, enter into such supplemental indenture.
It shall not be necessary for the consent of the Holders under
this Section to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
Section 8.03. Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or the
Notes shall comply with the TIA as then in effect.
Section 8.04. Revocation and Effect of Consents.
Until an amendment, supplement, waiver or other action becomes
effective, a consent to it by a Holder is a continuing consent conclusive and
binding upon such Holder and every subsequent Holder of the same Note or portion
thereof, and of any Note issued upon the transfer thereof or in exchange
therefor or in place thereof, even if notation of the consent is not made on any
such Note. Any such Holder or subsequent Holder, however, may revoke the consent
as to his Note or portion of a Note, if the Trustee receives the notice of
revocation before the date the amendment, supplement, waiver or other action
becomes effective.
The Issuers may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to consent to any
amendment, supplement, or waiver. If a record date is fixed, then,
notwithstanding the preceding paragraph, those Persons who were Holders at such
record date (or their duly designated proxies), and only such Persons, shall be
entitled to consent to such amendment, supplement, or waiver or to revoke any
consent previously given, whether or not such Persons continue to be Holders
after such record date. No such consent shall be valid or effective for more
than 90 days after such record date unless the consent of the requisite number
of Holders has been obtained.
After an amendment, supplement, waiver or other action becomes
effective, it shall bind every Noteholder, unless
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it makes a change described in any of clauses (1) through (9) of Section 8.02
hereof. In that case the amendment, supplement, waiver or other action shall
bind each Holder who has consented to it and every subsequent Holder of a Note
or portion of a Note that evidences the same debt as the consenting Holder's
Note.
Section 8.05. Notation on or Exchange of Notes.
If an amendment, supplement, or waiver changes the terms of a
Note, the Trustee may request the Holder to deliver it to the Trustee. In such
case, the Trustee shall place an appropriate notation on the Note about the
changed terms and return it to the Holder. Alternatively, if the Issuers or the
Trustee so determine, the Issuers in exchange for the Note shall issue and the
Trustee shall authenticate a new Note that reflects the changed terms. Failure
to make the appropriate notation or issue a new Note shall not affect the
validity and effect of such amendment supplement or waiver.
Section 8.06. Trustee to Sign Amendments, etc.
The Trustee shall sign any amendment, supplement or waiver
authorized pursuant to this Article 8 if the amendment, supplement or waiver
does not materially adversely affect the rights, duties, liabilities or
immunities of the Trustee. If it does, the Trustee may, but need not, sign it.
In signing or refusing to sign such amendment, supplement or waiver the Trustee
shall be entitled to receive and, subject to Section 7.01 hereof, shall be fully
protected in relying upon an Officers' Certificate and an Opinion of Counsel
stating that such amendment, supplement or waiver is authorized or permitted by
this Indenture. The Issuers and each Guarantor may not sign an amendment or
supplement until the Board of Directors of each of the Issuers and each such
Guarantor approves it.
ARTICLE 9
DISCHARGE OF INDENTURE; DEFEASANCE
Section 9.01. Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect (except as
to surviving rights of registration of transfer or exchange of Notes herein
expressly provided for) and the Trustee, on written demand of and at the expense
of the Issuers,
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shall execute proper instruments acknowledging satisfaction and discharge of
this Indenture, when either:
(a) all Notes theretofore authenticated and delivered (other
than (A) Notes which have been destroyed, lost or stolen and which have
been replaced or paid as provided in Section 2.07 hereof and (B) Notes
for whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Issuers and thereafter repaid to
the Issuers or discharged from such trust) have been delivered to the
Trustee for cancellation; or
(b) (i) all such Notes not theretofore delivered to the
Trustee for cancellation have become due and payable and the Issuers
have irrevocably deposited or caused to be deposited with the Trustee
in trust for the purpose an amount of U.S. legal tender or U.S.
Government Obligations sufficient to pay and discharge the entire
Indebtedness on such Notes not theretofore delivered to the Trustee for
cancellation, for the principal of, premium, if any, and interest to
the date of such deposit; (ii) the Issuers have paid or caused to be
paid all other sums payable hereunder by the Issuers; and (iii) the
Issuers have delivered to the Trustee (A) irrevocable instructions to
apply the deposited money toward payment of the Notes at the maturity
thereof, and (B) an Officers' Certificate and an Opinion of Counsel
each stating that all conditions precedent herein provided for relating
to the satisfaction and discharge of this Indenture have been complied
with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Issuers to the Trustee under Section 7.07 and, if money shall
have been deposited with the Trustee pursuant to subclause (a)(B) of this
Section 9.01, the obligations of the Trustee under Section 9.05, shall survive.
Section 9.02. Legal Defeasance.
The Issuers may at their option, by Board Resolution, be
discharged from their obligations with respect to the Notes and the Guarantors
discharged from their obligations under the Guarantees (hereinafter, "Legal
Defeasance"). For this purpose, such Legal Defeasance means that the Issuers
shall be deemed to have paid and discharged the entire indebtedness represented
by the Notes and to have satisfied all of their other obligations under such
Notes and this Indenture insofar as such Notes are concerned (and the Trustee,
at the expense of the Issuers, shall, subject to Section 9.06 hereof, execute
proper
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instruments acknowledging the same), except for the following which shall
survive until otherwise terminated or discharged hereunder: (A) the rights of
Holders of outstanding Notes to receive solely from the trust funds described in
Section 9.04 hereof and as more fully set forth in such Section, payments in
respect of the principal of, premium, if any, and interest on such Notes when
such payments are due, (B) the Issuers' obligations with respect to such Notes
under Article 2 and Section 4.17 hereof, (C) the rights, powers, trusts, duties,
and immunities of the Trustee hereunder (including claims of, or payments to,
the Trustee under or pursuant to Section 7.07 hereof) and (D) this Article 9.
Subject to compliance with this Article 9, the Issuers may exercise their option
under this Section 9.02 with respect to the Notes notwithstanding the prior
exercise of their option under Section 9.03 below with respect to the Notes.
Section 9.03. Covenant Defeasance.
At the option of the Issuers, pursuant to a Board Resolution,
the Issuers and the Guarantors shall be released from their respective
obligations under Sections 4.02, 4.04 through 4.14, 4.16, and 4.18 through 4.23
hereof, and clause (3) of the first paragraph of Section 5.01 hereof with
respect to the outstanding Notes on and after the date the conditions set forth
in Section 9.04 hereof are satisfied (hereinafter, "Covenant Defeasance"). For
this purpose, such Covenant Defeasance means that the Issuers may omit to comply
with and shall have no liability in respect of any term, condition or limitation
set forth in any such specified Section or portion thereof, whether directly or
indirectly by reason of any reference elsewhere herein to any such specified
Section or portion thereof or by reason of any reference in any such specified
Section or portion thereof to any other provision herein or in any other
document, but the remainder of this Indenture and the Notes shall be unaffected
thereby.
Section 9.04. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of
Section 9.02 or Section 9.03 hereof to the outstanding Notes:
(1) the Issuers shall irrevocably have deposited or caused to
be deposited with the Trustee (or another trustee satisfying the
requirements of Section 7.10 hereof who shall agree to comply with the
provisions of this Arti-
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cle 9 applicable to it) as funds in trust for the purpose of making
the following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders, (A) U.S. legal tender
in an amount, or (B) U.S. Government Obligations which through the
scheduled payment of principal and interest in respect thereof in
accordance with their terms will provide, not later than the due date
of any payment, money in an amount, or (C) a combination thereof,
sufficient, in the opinion of a nationally-recognized firm of
independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, and which shall
be applied by the Trustee (or other qualifying trustee) to pay and
discharge, the principal of, premium, if any, and accrued interest on
the outstanding Notes at the maturity date of such principal, premium,
if any, or interest, or on dates for payment and redemption of such
principal, premium, if any, and interest selected in accordance with
the terms of this Indenture and of the Notes; provided, however, that
the Trustee (or other qualifying trustee) shall have received an
irrevocable written order from the Issuers instructing the Trustee (or
other qualifying trustee) to apply such money or the proceeds of such
U.S. Government Obligations to said payments with respect to the Notes;
(2) no Event of Default or Default shall have occurred and no
Event of Default of the type specified in Section 6.01(g) or (h) shall
have occurred and be continuing on the date of such deposit, or shall
have occurred and be continuing at any time during the period ending on
the 91st day after the date of such deposit or, if longer, ending on
the day following the expiration of the longest preference period under
any Bankruptcy Law applicable to the Issuers in respect of such deposit
(it being understood that this condition shall not be deemed satisfied
until the expiration of such period);
(3) such Legal Defeasance or Covenant Defeasance shall not
cause the Trustee to have a conflicting interest for purposes of the
TIA with respect to any securities of the Issuers;
(4) such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute default under any
other material agreement or instrument to which the Issuers or any of
their Subsidiaries are
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a party or by which any Issuer or any of its Subsidiaries is bound;
(5) the Issuers shall have delivered to the Trustee an Opinion
of Counsel stating that, as a result of such Legal Defeasance or
Covenant Defeasance, neither the trust nor the Trustee will be required
to register as an investment company under the Investment Company Act
of 1940, as amended;
(6) in the case of an election under Section 9.02 above, the
Issuers shall have delivered to the Trustee an Opinion of Counsel
stating that (i) the Issuers have received from, or there has been
published by, the Internal Revenue Service a ruling to the effect that
or (ii) there has been a change in any applicable Federal income tax
law with the effect that, and such opinion shall confirm that, the
Holders of the outstanding Notes or persons in their positions will not
recognize income, gain or loss for Federal income tax purposes solely
as a result of such Legal Defeasance and will be subject to Federal
income tax on the same amounts, in the same manner, including as a
result of prepayment, and at the same times as would have been the case
if such Legal Defeasance had not occurred;
(7) in the case of an election under Section 9.03 hereof, the
Issuers shall have delivered to the Trustee an Opinion of Counsel
describing either a private ruling concerning the Notes or a published
ruling of the Internal Revenue Service to the effect 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;
(8) the Issuers shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for relating to either the Legal
Defeasance under Section 9.02 above or the Covenant Defeasance under
Section 9.03 hereof (as the case may be) have been complied with;
(9) the Issuers shall have delivered to the Trustee an
Officers' Certificate stating that the deposit under clause (1) was not
made by the Issuers with the intent of preferring the holders of the
Notes over any other credi-
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tors of the Issuers or with the intent of defeating, hindering,
delaying or defrauding any creditors of the Issuers or others; and
(10) the Issuers shall have delivered to the Trustee an
Opinion of Counsel to the effect that:
(a) the funds deposited in trust will not be subject
to any rights of holders of Senior Indebtedness, including,
without limitation, those arising under this Indenture, and
(b) assuming no intervening event of the type
described in Section 6.01(g) or (h) shall occur and no Holder
is an "insider" (as such term is used under applicable
Bankruptcy Law) of any Issuer after the 91st day after the
date of such deposit or, if longer, ending on the day
following the expiration of the longest preference period
under any Bankruptcy Law applicable to the Issuers in respect
of such deposit, the funds deposited in trust will not be
subject to the effect of any Bankruptcy Law; and
(11) before or after a deposit, the Issuers may make
arrangements satisfactory to the Trustee for the redemption of Notes at
a future date in accordance with Section 3.07(a) hereof.
Section 9.05. Deposited Money and U.S. Government Obligations to Be Held in
Trust; Other Miscellaneous Provisions.
All money and U.S. Government Obligations (including the
proceeds thereof) deposited with the Trustee pursuant to Section 9.01 or 9.04
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 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 accrued interest, but such
money need not be segregated from other funds except to the extent required by
law.
The Issuers and the Guarantors shall pay and indemnify the
Trustee against any tax, fee or other charge imposed on or assessed against the
U.S. Government Obligations deposited pursuant to Section 9.01 or 9.04 hereof or
the principal,
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premium, if any, 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 9 to the contrary notwithstanding,
the Trustee shall deliver or pay to the Issuers from time to time upon a written
request of the Issuers in the form of an Officers' Certificate any money or U.S.
Government Obligations held by it as provided in Section 9.01 or 9.04 hereof
which, in the opinion of a nationally-recognized firm of independent public
accountants expressed in a written certification thereof delivered to the
Trustee, are in excess of the amount thereof which would then be required to be
deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
Section 9.06. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or
U.S. Government Obligations in accordance with Section 9.01, 9.02 or 9.03 hereof
by reason of any legal proceeding or by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, the Issuers' and each Guarantor's obligations under this
Indenture, the Notes and the Guarantees shall be revived and reinstated as
though no deposit had occurred pursuant to this Article 9 until such time as the
Trustee or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with Section 9.01 hereof; provided, however, that if
the Issuers or the Guarantors have made any payment of principal of, premium, if
any, or accrued interest on any Notes because of the reinstatement of their
obligations, the Issuers and each such Guarantor shall be subrogated to the
rights of the Holders of such Notes to receive such payment from the money or
U.S. Government Obligations held by the Trustee or Paying Agent.
Section 9.07. Moneys Held by Paying Agent.
In connection with the satisfaction and discharge of this
Indenture, all moneys then held by any Paying Agent under the provisions of this
Indenture shall, upon demand of the Issuers, be paid to the Trustee, or if
sufficient moneys have been deposited pursuant to Section 9.01 hereof, to the
Issuers (or, if such moneys had been deposited by any Guarantor, to such
Guarantor) and thereupon such Paying Agent shall be released from all further
liability with respect to such moneys.
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Section 9.08. Moneys Held by Trustee.
Any moneys deposited with the Trustee or any Paying Agent or
then held by the Issuers or any Guarantor in trust for the payment of the
principal of, or premium, if any, or interest on any Note that are not applied
but remain unclaimed by the Holder of such Note for two years after the date
upon which the principal of, or premium, if any, or interest on such Note shall
have respectively become due and payable shall be repaid to the Issuers (or, if
appropriate, the applicable Guarantor) upon a written request of the Issuers in
the form of an Officers' Certificate, or if such moneys are then held by the
Issuers or any Guarantor in trust, such moneys shall be released from such
trust; and the Holder of such Note entitled to receive such payment shall
thereafter, as an unsecured general creditor, look only to the Issuers and the
Guarantors for the payment thereof, and all liability of the Trustee or such
Paying Agent with respect to such trust money shall thereupon cease.
ARTICLE 10
GUARANTEES
Section 10.01. Guarantees.
Each Guarantor hereby unconditionally and irrevocably
guarantees, jointly and severally, to each Holder and to the Trustee on behalf
of the Holders and its successors and assigns (a) the due and punctual payment
of principal of, premium, if any, and interest on the Notes when due, whether at
maturity, by acceleration, by redemption or otherwise, and all other monetary
obligations of the Issuers under this Indenture, the Notes and the Registration
Rights Agreement and (b) the full and punctual performance within applicable
grace periods of all other obligations of the Issuers under this Indenture, the
Notes and the Registration Rights Agreement (all the foregoing being hereinafter
collectively called the "Guaranteed Obligations"). Each Guarantor further agrees
that the Guaranteed Obligations may be extended or renewed, in whole or in part,
without notice or further assent from such Guarantor and that such Guarantor
will remain bound under this Article 10 notwithstanding any extension or renewal
of any Guaranteed Obligation.
Each Guarantor waives diligence, presentment, demand of
payment, filing of claims with a court in the event of in-
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solvency or bankruptcy of any Issuer, any right to require a proceeding first
against the Issuer, protest, notice and all demands whatsoever. Each Guarantor
waives notice of any default under the Notes or the Guaranteed Obligations. The
obligations of each Guarantor hereunder shall not be affected by (a) the failure
of any Holder or the Trustee to assert any claim or demand or to enforce any
right or remedy against the Company or any other Person under this Indenture,
the Notes or any other agreement or otherwise; (b) any extension or renewal of
any thereof; (c) any rescission, waiver, amendment or modification of any of the
terms or provisions of this Indenture, the Notes or any other agreement; (d) the
release of any security held by any Holder or the Trustee for the Guaranteed
Obligations or any of them; (e) the failure of any Holder or the Trustee to
exercise any right or remedy against any other guarantor of the Guaranteed
Obligations; or (f) except as provided in Section 10.06, any change in the
ownership of such Guarantor.
Except as expressly set forth in Sections 10.02 and 10.06, the
obligations of each Guarantor hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason, including any claim of
waiver, release, surrender, alteration or compromise, and shall not be subject
to any defense of setoff, counterclaim, recoupment or termination whatsoever or
by reason of the invalidity, illegality or unenforceability of the Guaranteed
Obligations or otherwise. Without limiting the generality of the foregoing, the
obligations of each Guarantor herein shall not be discharged or impaired or
otherwise affected by the failure of any Holder or the Trustee to assert any
claim or demand or to enforce any remedy under this Indenture, the Notes or any
other agreement, by any waiver or modification of any thereof, by any default,
failure or delay, willful or otherwise, in the performance of the Guaranteed
Obligations, or by any other act or thing or omission or delay to do any other
act or thing which may or might in any manner or to any extent vary the risk of
such Guarantor or would otherwise operate as a discharge of such Guarantor as a
matter of law or equity.
Each Guarantor further agrees that its Guarantee herein shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of principal of, premium, if any, or interest on
any Guaranteed Obligation is rescinded or must otherwise be restored by any
Holder or the Trustee upon the bankruptcy or reorganization of any Issuer or
otherwise.
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In furtherance of the foregoing and not in limitation of any
other right which any Holder or the Trustee has at law or in equity against any
Guarantor by virtue hereof, upon the failure of any Issuer to pay the principal
of, premium, if any, or interest on any obligation under the Notes or this
Indenture when and as the same shall become due, whether at maturity, by
acceleration, by redemption or otherwise, or to perform or comply with any other
obligation under the Notes or this Indenture, each Guarantor hereby promises to
and will, upon receipt of written demand by the Trustee, forthwith pay, or cause
to be paid, in cash, to the Holders or the Trustee an amount equal to the sum of
(i) the unpaid amount of such Guaranteed Obligations, (ii) accrued and unpaid
interest on such Guaranteed Obligations (but only to the extent not prohibited
by law) and (iii) all other monetary Guaranteed Obligations of the Issuers to
the Holders and the Trustee.
Each Guarantor agrees that it shall not be entitled to any
right of subrogation in respect of any Guaranteed Obligations guaranteed hereby
until payment in full of all Guaranteed Obligations. Each Guarantor further
agrees that, as between it, on the one hand, and the Holders and the Trustee, on
the other hand, (x) the maturity of the Guaranteed Obligations hereby may be
accelerated as provided in Section 6 for the purposes of such Guarantor's
Guarantee herein, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the obligations under the Notes or
this Indenture guaranteed hereby, and (y) in the event of any declaration of
acceleration of such obligations as provided in Section 6, such obligations
(whether or not due and payable) shall forthwith become due and payable by such
Guarantor for the purposes of this Section.
Each Guarantor also agrees to pay any and all costs and
expenses (including reasonable attorneys' fees) incurred by the Trustee or any
Holder in enforcing any rights under this Article 10.
Section 10.02. Limitation on Liability.
Any term or provision of this Indenture to the contrary
notwithstanding, the maximum aggregate amount of the obligations guaranteed
hereunder by any Guarantor shall not exceed the maximum amount that can be
hereby guaranteed without rendering this Indenture, as it relates to such
Guarantor, voidable under applicable law relating to fraudulent conveyance or
fraudulent transfer or similar laws affecting the rights of creditors generally.
To effectuate the foregoing intention,
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the obligations of each Guarantor shall be limited to the maximum amount as
will, after giving effect to all other contingent and fixed liabilities of such
Guarantor and after giving effect to any collections from or payments made by or
on behalf of any other Guarantor in respect of the obligations of such other
Guarantor under its Guarantee or pursuant to its contribution obligations
hereunder, result in the obligations of such Guarantor under its Guarantee not
constituting a fraudulent conveyance or fraudulent transfer under federal or
state law. Each Guarantor that makes a payment or distribution under a Guarantee
shall be entitled to a contribution from each other Guarantor in a pro rata
amount based on the Adjusted Net Assets of each Guarantor.
In case any provision of this Guarantee shall be invalid,
illegal or unenforceable, the validity, legality, and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
Section 10.03. Successors and Assigns.
This Article 10 shall be binding upon each Guarantor and its
successors and assigns and shall enure to the benefit of the successors and
assigns of the Trustee and the Holders and, in the event of any transfer or
assignment of rights by any Holder or the Trustee, the rights and privileges
conferred upon that party in this Indenture and in the Notes shall automatically
extend to and be vested in such transferee or assignee, all subject to the terms
and conditions of this Indenture.
Section 10.04. No Waiver.
Neither a failure nor a delay on the part of either the
Trustee or the Holders in exercising any right, power or privilege under this
Article 10 shall operate as a waiver thereof, nor shall a single or partial
exercise thereof preclude any other or further exercise of any right, power or
privilege. The rights, remedies and benefits of the Trustee and the Holders
herein expressly specified are cumulative and not exclusive of any other rights,
remedies or benefits which either may have under this Article 10 at law, in
equity, by statute or otherwise.
Section 10.05. Modification.
No modification, amendment or waiver of any provision of this
Article 10, nor the consent to any departure by any
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Guarantor therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Trustee, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given. No
notice to or demand on any Guarantor in any case shall entitle such Guarantor to
any other or further notice or demand in the same, similar or other
circumstances.
Section 10.06. Release of Guarantor.
A Guarantor shall be released from all of its obligations
under its Guarantee if:
(i) the Guarantor has sold all or substantially all of its
assets or the Company and its Restricted Subsidiaries have sold all of
the Capital Stock of the Guarantor owned by them, in each case in a
transaction in compliance with Sections 4.09 and 5.01 hereof; or
(ii) the Guarantor merges with or into or consolidates with,
or transfers all or substantially all of its assets to, the Company or
another Guarantor in a transaction in compliance with Section 5.01
hereof;
and in each such case, such Guarantor has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to such transactions have been complied
with.
Section 10.07. Execution of Supplemental Indenture for Future Guarantors.
Each Subsidiary which is required to become a Guarantor
pursuant to Section 4.22 shall, and the Issuers shall cause each such Subsidiary
to, promptly execute and deliver to the Trustee a supplemental indenture in the
form of Exhibit F hereto pursuant to which such Subsidiary shall become a
Guarantor under this Section 10 and shall guarantee the obligations of the
Company under the Notes and this Indenture. Concurrently with the execution and
delivery of such supplemental indenture, the Company shall deliver to the
Trustee an Opinion of Counsel to the effect that such supplemental indenture has
been duly authorized, executed and delivered by such Subsidiary and that,
subject to the application of bankruptcy, insolvency, moratorium, fraudulent
conveyance or transfer and other similar laws relating to creditors' rights
generally and to the principles of equity, whether considered in a proceeding at
law or in equity, the Guarantee of such Guarantor is a legal, valid and
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binding obligation of such Guarantor, enforceable against such Guarantor in
accordance with its terms.
Section 10.08. Execution and Delivery of Guarantees.
To evidence the Guarantee set forth in this Article 10, each
Guarantor hereby agrees that a notation of such Guarantee substantially in the
form of Exhibit E hereto shall be placed on each Note authenticated and made
available for delivery by the Trustee and that this Guarantee shall be executed
on behalf of each Guarantor by the manual or facsimile signature of two Officers
or an Officer and the Secretary of each Guarantor.
Each Guarantor hereby agrees that the Guarantee set forth in
Section 10.01 shall remain in full force and effect notwithstanding any failure
to endorse on each Note a notation of such Guarantee.
If an Officer of a Guarantor whose signature is on the
Guarantee no longer holds that office at the time the Trustee authenticates the
Note on which the Guarantee is endorsed, the Guarantee shall be valid
nevertheless.
The delivery of any Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the Guarantee
set forth in this Indenture on behalf of each Guarantor.
Section 10.09. Guarantee Obligations Subordinated to Guarantor Senior
Indebtedness.
Each Guarantor covenants and agrees, and each Holder, by its
acceptance thereof, likewise covenants and agrees, that to the extent and in the
manner hereinafter set forth in this Article 10, the Indebtedness represented by
the Guarantee and the payment of all Obligations on the Notes pursuant to the
Guarantee by such Guarantor are hereby expressly made subordinate in right of
payment as provided in this Article 10 to the prior indefeasible payment and
satisfaction in full in cash of all Obligations in respect of all Guarantor
Senior Indebtedness of such Guarantor (including post-petition interest
thereon).
This Section 10.09 and the following Sections 10.10 through
10.14 are for the benefit of, and shall be enforceable directly by, the holders
of Guarantor Senior Indebtedness, each holder is made an obligee hereunder, and
each holder of any Guarantor Senior Indebtedness, whether now outstanding or
here-
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after created, incurred, assumed or guaranteed, shall be deemed to have
acquired such Guarantor Senior Indebtedness in reliance upon the covenants and
provisions contained in this Indenture and the Notes.
Section 10.10. Payment Over of Proceeds upon Dissolution, etc., of a Guarantor.
In the event of (a) any insolvency or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding in connection therewith, relative to any Guarantor or to its
creditors, as such, or to its assets, whether voluntary or involuntary, or (b)
any liquidation, dissolution or other winding-up of any Guarantor, whether
voluntary or involuntary and whether or not involving insolvency or bankruptcy
or (c) any general assignment for the benefit of creditors or any other
marshaling of assets or liabilities of any Guarantor, then and in any such
event:
(1) the holders of all Guarantor Senior Indebtedness of such
Guarantor shall be entitled to receive indefeasible payment and
satisfaction in full in cash, of all amounts due on or in respect of
all such Guarantor Senior Indebtedness (including interest after the
commencement of any such proceeding at the rate specified in the
applicable Guarantor Senior Indebtedness, whether or not an allowed
claim), of such Guarantor before the Holders are entitled to receive or
retain, pursuant to the Guarantee of such Guarantor, any payment or
distribution of any kind or character (other than payment or
distribution from the trust described in Section 9.04) by such
Guarantor on account of any of the Guaranteed Obligations; and
(2) any payment or distribution of assets of such Guarantor of
any kind or character, whether in cash, Property or securities, by
set-off or otherwise, to which the Holders or the Trustee would be
entitled but for the subordination provisions of this Article 10 shall
be paid by the liquidating trustee or agent or other Person making such
payment or distribution, whether a trustee in bankruptcy, a receiver or
liquidating trustee or otherwise, directly to the holders of Guarantor
Senior Indebtedness of such Guarantor or their representative or
representatives or to the trustee or trustees under any indenture under
which any instruments evidencing any of such Guarantor Senior
Indebtedness may have been issued, ratably according to the aggregate
amounts remaining unpaid on account of such Guarantor Senior
Indebtedness held or rep-
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resented by each, to the extent necessary to make indefeasible payment
in full in cash of all such Guarantor Senior Indebtedness remaining
unpaid, after giving effect to any concurrent payment or distribution
to the holders of such Guarantor Senior Indebtedness; and
(3) in the event that, notwithstanding the foregoing
provisions of this Section 10.10, the Trustee or any Holder shall have
received any payment or distribution of assets of such Guarantor of any
kind or character, whether in cash, Property or securities, including,
without limitation, by way of set-off or otherwise, in respect of any
of the Guaranteed Obligations before all Guarantor Senior Indebtedness
of such Guarantor is indefeasibly paid in full, then and in such event
such payment or distribution shall be held in trust for the benefit of
and shall be paid over or delivered forthwith to the trustee in
bankruptcy, receiver, liquidating trustee, custodian, assignee, agent
or other Person making payment or distribution of assets of such
Guarantor for application to the payment of all such Guarantor Senior
Indebtedness remaining unpaid, to the extent necessary to pay all of
such Guarantor Senior Indebtedness in full in cash, Cash Equivalents
or, as acceptable to the holders of such Guarantor Senior Indebtedness,
any other manner, after giving effect to any concurrent payment or
distribution to or for the holders of such Guarantor Senior
Indebtedness.
To the extent any payment of Guarantor Senior Indebtedness
(whether by or on behalf of any Issuer, as proceeds of security or enforcement
of any right of setoff or otherwise) is declared to be fraudulent or
preferential, set aside or required to be paid to any receiver, trustee in
bankruptcy, liquidating trustee, agent or other similar Person under any
bankruptcy, insolvency, receivership, fraudulent conveyance or similar law,
then, if such payment is recovered by, or paid over to, such receiver, trustee
in bankruptcy, liquidating trustee, agent or other similar Person, the Guarantor
Senior Indebtedness or part thereof originally intended to be satisfied shall be
deemed to be reinstated and outstanding as if such payment had not occurred.
The consolidation of a Guarantor with, or the merger of a
Guarantor with or into, another Person or the liquidation or dissolution of a
Guarantor following the conveyance, transfer or lease of its properties and
assets substantially as an entirety to another Person upon the terms and
conditions set forth in Article 5 hereof shall not be deemed a dissolution,
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winding-up, liquidation, reorganization, assignment for the benefit of creditors
or marshaling of assets and liabilities of such Guarantor for the purposes of
this Article 10 if the Person formed by such consolidation or the surviving
entity of such merger or the Person which acquires by conveyance, transfer or
lease such properties and assets substantially as an entirety, as the case may
be, shall, as a part of such consolidation, merger, conveyance, transfer or
lease, comply with the conditions set forth in such Article 5 hereof.
Section 10.11. Suspension of Guaranteed Obligations When Guarantor Senior
Indebtedness in Default.
(a) Unless Section 10.10 hereof shall be applicable, after the
occurrence of a Payment Default no payment or distribution (other than a payment
or distribution from the trust described in Section 9.04) of any kind or
character (including, without limitation, cash, Property and any payment or
distribution which may be payable or deliverable by reason of the payment of any
other Indebtedness of such Guarantor being subordinated to its Guaranteed
Obligations) may be made by or on behalf of such Guarantor (or any Subsidiary of
such Guarantor), including, without limitation, by way of set-off or otherwise,
for or on account of the Notes or its Guaranteed Obligations, and neither the
Trustee nor any Holder shall take or receive from any Guarantor (or any
Subsidiary of such Guarantor), directly or indirectly in any manner, payment in
respect of all or any portion of the Notes or its Guaranteed Obligations
commencing on the date of the receipt by the Trustee of written notice from the
representative of the holders of Guarantor Senior Indebtedness (the "Guarantor
Representative") of the occurrence of a Payment Default, and in any such event,
such prohibition shall continue until such Payment Default is cured, waived in
writing or ceases to exist. At such time as the prohibition set forth in the
preceding sentence shall no longer be in effect, subject to the provisions of
the following paragraph (b), such Guarantor shall resume making any and all
required payments in respect of the Guaranteed Obligations.
(b) Unless Section 10.10 hereof shall be applicable, upon the
occurrence of a Non-Payment Event of Default on Designated Senior Indebtedness
of any Guarantor, no payment or distribution (other than a payment or
distribution made from the trust described in Section 9.04) of any assets of
such Guarantor of any kind or character (including, without limitation, cash,
Property and any payment or distribution which may be payable or deliverable by
reason of the payment of any other Indebtedness of such Guarantor being
subordinated to its Guar-
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anteed Obligations) shall be made by such Guarantor, including, without
limitation, by way of set-off or otherwise, for or on account of the Notes or
any of its Guaranteed Obligations or any Obligations under the Notes, the
Registration Rights Agreement or this Indenture, or for or on account of the
purchase, redemption or other acquisition of any Notes and neither the Trustee
nor any Holder shall take or receive from such Guarantor, directly or indirectly
in any manner, payment in respect of all or any portion of the Guaranteed
Obligations or any Obligations under the Notes, the Registration Rights
Agreement or this Indenture, or for or on account of the purchase, redemption or
other acquisition of any Notes for a period (the "Guarantee Payment Blockage
Period") commencing on the date of receipt by the Trustee of written notice from
the Guarantor Representative of such Non-Payment Event of Default, unless and
until (subject to any blockage of payments that may then be in effect under the
preceding paragraph (a)) the earliest to occur of the following events: (w) more
than 179 days shall have elapsed since the date of receipt of such written
notice by the Trustee, (x) such Non-Payment Event of Default shall have been
cured or waived in writing or shall have ceased to exist, (y) such Designated
Senior Indebtedness shall have been indefeasibly paid in full in cash or (z)
such Guarantee Payment Blockage Period shall have been terminated by written
notice to such Guarantor or the Trustee from the Guarantor Representative, after
which, in the case of clause (w), (x), (y) or (z), such Guarantor shall resume
making any and all required payments in respect of the Guaranteed Obligations.
Notwithstanding any other provisions of this Indenture, in no event shall a
Guarantee Payment Blockage Period extend beyond 179 days from the date of the
receipt by the Trustee of the notice referred to in this Section 10.11(b) or, in
the event of a Non-Payment Event of Default which formed the basis for a Payment
Blockage Period under Section 11.03(b) hereof, 179 days from the date of the
receipt by the Trustee of the notice referred to in Section 11.03(b) (the
"Initial Guarantee Blockage Period"). Any number of additional Guarantee Payment
Blockage Periods may be commenced during the Initial Guarantee Blockage Period;
provided, however, that no such additional Guarantee Payment Blockage Period
shall extend beyond the Initial Guarantee Blockage Period. After the expiration
of the Initial Guarantee Blockage Period, no Guarantee Payment Blockage Period
may be commenced under this Section 10.11(b) and no Payment Blockage Period may
be commenced under Section 11.03(b) hereof until at least 180 consecutive days
have elapsed from the last day of the Initial Guarantee Blockage Period.
Notwithstanding any other provisions of this Indenture, no Non-Payment Event of
Default with respect to Designated Senior Indebtedness which existed or was
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continuing on the date of the commencement of any Guarantee Payment Blockage
Period initiated by the Guarantor Representative shall be, or be made, the basis
for the commencement of a second Guarantee Payment Blockage Period initiated by
the Guarantor Representative unless such Non-Payment Event of Default shall have
been cured or waived for a period of not less than 90 consecutive days.
Notwithstanding the foregoing, if the obligations of the Issuers under the Notes
have been accelerated pursuant to Article 6 of this Indenture or otherwise, the
Trustee shall be deemed to have received notice from the Guarantor
Representative of a Non-Payment Event of Default relating to such acceleration
as provided for in the first sentence of this clause (b).
(c) In the event that, notwithstanding the foregoing, the
Trustee or any Holder receives any payment or distribution of assets of such
Guarantor of any kind, whether in cash, Property or securities, including,
without limitation, by way of set-off or otherwise, in respect of the Guaranteed
Obligations, before all Guarantor Senior Indebtedness of such Guarantor is
indefeasibly paid and satisfied in full in cash, then such payment or
distribution (other than a payment or distribution from the trust described in
Section 9.04) will be held by the recipient in trust for the benefit of holders
of Guarantor Senior Indebtedness and will be immediately paid over or delivered
to the holders of Guarantor Senior Indebtedness or their representative or
representatives to the extent necessary to make a payment in full of all
Guarantor Senior Indebtedness remaining unpaid, after giving effect to any
concurrent payment or distribution, or provision therefor, to or for the holders
of Guarantor Senior Indebtedness.
Section 10.12. Subrogation to Rights of Holders of Guarantor Senior
Indebtedness.
Upon the payment in full of all amounts payable under or in
respect of all Guarantor Senior Indebtedness of a Guarantor, the Holders shall
be subrogated to the rights of the holders of such Guarantor Senior Indebtedness
to receive payments and distributions of cash, Property and securities of such
Guarantor made on such Guarantor Senior Indebtedness until all amounts due to be
paid under the Guarantee shall be paid in full. For the purposes of such
subrogation, no payments or distributions to holders of Guarantor Senior
Indebtedness of any cash, Property or securities to which Holders or the Trustee
would be entitled except for the provisions of this Article 10, and no payments
over pursuant to the provisions of this Article 10 to holders of Guarantor
Senior Indebtedness by Holders
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or the Trustee, shall, as among each Guarantor, its creditors other than holders
of Guarantor Senior Indebtedness and the Holders, be deemed to be a payment or
distribution by such Guarantor to or on account of such Guarantor Senior
Indebtedness.
If any payment or distribution to which the Holders would
otherwise have been entitled but for the provisions of this Article 10 shall
have been applied, pursuant to the provisions of this Article 10, to the payment
of all amounts payable under Guarantor Senior Indebtedness, then and in such
case, the Holders shall be entitled to receive from the holders of such
Guarantor Senior Indebtedness at the time outstanding any payments or
distributions received by such holders of Guarantor Senior Indebtedness in
excess of the amount sufficient to pay all amounts payable under or in respect
of such Guarantor Senior Indebtedness in full in cash.
Section 10.13. Guarantee Subordination Provisions Solely to Define Relative
Rights.
The subordination provisions of this Article 10 are and are
intended solely for the purpose of defining the relative rights of the Holders
on the one hand and the holders of Guarantor Senior Indebtedness on the other
hand. Nothing contained in this Article 10 or elsewhere in this Indenture or in
the Notes is intended to or shall (a) impair, as among each Guarantor, its
creditors other than holders of its Guarantor Senior Indebtedness and the
Holders, the obligation of such Guarantor, which is absolute and unconditional,
to make payments to the Holders in respect of the Guaranteed Obligations in
accordance with its terms; or (b) affect the relative rights against such
Guarantor of the Holders and creditors of such Guarantor other than the holders
of the Guarantor Senior Indebtedness; or (c) prevent the Trustee or any Holder
from exercising all remedies otherwise permitted by applicable law upon a
Default or an Event of Default under this Indenture, subject to the rights, if
any, under this Article 10 of the holders of Guarantor Senior Indebtedness (1)
in any case, proceeding, dissolution, liquidation or other winding-up,
assignment for the benefit of creditors or other marshaling of assets and
liabilities of the Issuers referred to in Section 10.10 hereof, to receive,
pursuant to and in accordance with such Section, cash, Property and securities
otherwise payable or deliverable to the Trustee or such Holder, or (2) under the
conditions specified in Section 10.11 hereof, to prevent any payment prohibited
by such Section or enforce their rights pursuant to Section 10.11(c) hereof.
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The failure by any Guarantor to make a payment in respect of
its obligations on its Guarantee by reason of any provision of this Article 10
shall not be construed as preventing the occurrence of a Default or an Event of
Default hereunder.
Section 10.14. Application of Certain Article 11 Provisions.
The provisions of Sections 11.04, 11.07, 11.08, 11.09, 11.10,
11.12 and 11.13 hereof shall apply, mutatis mutandis, to each Guarantor and
their respective holders of Guarantor Senior Indebtedness and the rights, duties
and obligations set forth therein shall govern the rights, duties and
obligations of each Guarantor, the holders of Guarantor Senior Indebtedness, the
Holders and the Trustee with respect to the Guarantee and all references therein
to Article 11 hereof shall mean this Article 10.
ARTICLE 11
SUBORDINATION OF NOTES
Section 11.01. Notes Subordinate to Senior Indebtedness.
The Issuers covenant and agree, and each Holder, by its
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article 11, the Indebtedness
represented by the Notes and the payment of all Obligations on the Notes are
hereby expressly made subordinate in right of payment as provided in this
Article 11 to the prior indefeasible payment and satisfaction in full in cash of
all Obligations in respect of all Senior Indebtedness (including post-petition
interest thereon).
The provisions of this Article 11 are for the benefit of, and
shall be enforceable directly by, the holders of Senior Indebtedness of each
Issuer, each holder is made an obligee hereunder, and each holder of Senior
Indebtedness of an Issuer whether now outstanding or hereafter created,
incurred, assumed or guaranteed shall be deemed to have acquired Senior
Indebtedness of such Issuer in reliance upon the covenants and provisions
contained in this Indenture and the Notes.
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Section 11.02. Payment Over of Proceeds upon Dissolution, etc.
In the event of (a) any insolvency or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding in connection therewith, relative to any Issuer or to its
creditors, as such, or to its assets, whether voluntary or involuntary or (b)
any liquidation, dissolution or other winding-up of any Issuer, whether
voluntary or involuntary and whether or not involving insolvency or bankruptcy,
or (c) any general assignment for the benefit of creditors or any other
marshalling of assets or liabilities of any Issuer, then and in any such event:
(1) the holders of Senior Indebtedness of such Issuer shall be
entitled to receive indefeasible payment and satisfaction in full in
cash of all amounts due on or in respect of all Senior Indebtedness
(including interest after the commencement of any such proceeding at
the rate specified in the applicable Senior Indebtedness, whether or
not an allowed claim), of such Issuer before the Holders are entitled
to receive or retain any payment or distribution of any kind or
character (other than a payment or distribution from the trust
described in Section 9.04) on account of the Notes or any Obligations
on the Notes, the Registration Rights Agreement or this Indenture; and
(2) any payment or distribution of assets of any Issuer of any
kind or character, whether in cash, Property or securities, by set-off
or otherwise, to which the Holders or the Trustee would be entitled but
for the provisions of this Article 11 shall be paid by the liquidating
trustee or agent or other Person making such payment or distribution,
whether a trustee in bankruptcy, a receiver or liquidating trustee or
otherwise, directly to the holders of Senior Indebtedness or their
representative or representatives or to the trustee or trustees under
any indenture under which any instruments evidencing any of such Senior
Indebtedness may have been issued, ratably according to the aggregate
amounts remaining unpaid on account of the Senior Indebtedness held or
represented by each, to the extent necessary to make indefeasible
payment in full in cash of all Senior Indebtedness remaining unpaid,
after giving effect to any concurrent payment or distribution, to the
holders of such Senior Indebtedness; and
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(3) in the event that, notwithstanding the foregoing
provisions of this Section 11.02, the Trustee or any Holder shall have
received any payment or distribution of assets of the Issuers of any
kind or character, whether in cash, Property or securities, including,
without limitation, by way of set-off or otherwise, in respect of
principal of, premium, if any, and interest on the Notes before all
Senior Indebtedness is indefeasibly paid in full, then and in such
event such payment or distribution shall be held in trust for the
benefit of and shall be paid over or delivered forthwith to the trustee
in bankruptcy, receiver, liquidating trustee, custodian, assignee,
agent or other Person making payment or distribution of assets of the
Issuers for application to the payment of all Senior Indebtedness
remaining unpaid, to the extent necessary to pay all Senior
Indebtedness in full in cash, Cash Equivalents or, as acceptable to the
holders of Senior Indebtedness, any other manner, after giving effect
to any concurrent payment or distribution, to or for the holders of
Senior Indebtedness.
To the extent any payment of Senior Indebtedness (whether by
or on behalf of any Issuer, as proceeds of security or enforcement of any right
of setoff or otherwise) is declared to be fraudulent or preferential, set aside
or required to be paid to any receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person under any bankruptcy, insolvency,
receivership, fraudulent conveyance or similar law, then, if such payment is
recovered by, or paid over to, such receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person, the Senior Indebtedness or part thereof
originally intended to be satisfied shall be deemed to be reinstated and
outstanding as if such payment had not occurred.
The consolidation of the Company with, or the merger of the
Company with or into, another Person or the liquidation or dissolution of the
Company following the conveyance, transfer or lease of its properties and assets
substantially as an entirety to another Person upon the terms and conditions set
forth in Article 5 hereof shall not be deemed a dissolution, winding-up,
liquidation, reorganization, assignment for the benefit of creditors or
marshaling of assets and liabilities of the Company for the purposes of this
Article 11 if the Person formed by such consolidation or the surviving entity of
such merger or the Person which acquires by conveyance, transfer or lease such
properties and assets substantially as an entirety, as the case may be, shall,
as a part of such consolidation,
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merger, conveyance, transfer or lease, comply with the conditions set forth in
such Article 5 hereof.
Section 11.03. Suspension of Payment When Senior Indebtedness in Default.
(a) Unless Section 11.02 hereof shall be applicable, after the
occurrence of a Payment Default no payment or distribution (other than a payment
or distribution from the trust described in Section 9.04) of any kind or
character (including, without limitation, cash, Property and any payment or
distribution which may be payable or deliverable by reason of the payment of any
other Indebtedness of any Issuer being subordinated to the payment of the Notes
by such Issuer) may be made by or on behalf of such Issuer or any Subsidiary of
such Issuer, including, without limitation, by way of set-off or otherwise, for
or on account of the Notes or of any Obligations under the Notes, the
Registration Rights Agreement or this Indenture, or for or on account of the
purchase, redemption or other acquisition of any Notes, and neither the Trustee
nor any Holder shall take or receive from such Issuer or any Subsidiary of such
Issuer, directly or indirectly in any manner, payment in respect of all or any
portion of Notes or of any Obligations under the Notes, the Registration Rights
Agreement or this Indenture, or for or on account of the purchase, redemption or
other acquisition of any Notes commencing on the date of receipt by the Trustee
of written notice from the representa-tive of the holders of Designated Senior
Indebtedness (the "Representative") of the occurrence of a Payment Default, and
in any such event, such prohibition shall continue until such Payment Default is
cured, waived in writing or ceases to exist. At such time as the prohibition set
forth in the preceding sentence shall no longer be in effect, subject to the
provisions of the following paragraph (b), such Issuer shall resume making any
and all required payments in respect of the Notes, including any missed
payments.
(b) Unless Section 11.02 hereof shall be applicable, upon the
occurrence of a Non-Payment Event of Default on Designated Senior Indebtedness,
no payment or distribution (other than a payment or distribution from the trust
described in Section 9.04) of any assets of any Issuer of any kind or character
(including, without limitation, cash, Property and any payment or distribution
which may be payable or deliverable by reason of the payment of any other
Indebtedness of any Issuer being subordinated to the payment of the Notes by
such Issuer) shall be made by any Issuer or any Restricted Subsidiary of such
Issuer, including, without limitation, by way of set-off or oth-
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erwise, for or on account of the Notes or of any Obligations under the Notes,
the Registration Rights Agreement or this Indenture or on account of the
purchase, redemption or other acquisition of Notes, and neither the Trustee nor
any Holder shall take or receive from such Issuer or Restricted Subsidiary of
such Issuer, directly or indirectly in any manner, payment in respect of all or
any portion of the Notes or any Obligations under the Notes, the Registration
Rights Agreement or the Indenture for a period ("Payment Blockage Period")
commencing on the date of receipt by the Trustee of written notice from the
Representative of such Non-Payment Event of Default unless and until (subject to
any blockage of payments that may then be in effect under the preceding
paragraph (a)) the earliest to occur of the following events: (w) more than 179
days shall have elapsed since the date of receipt of such written notice by the
Trustee, (x) such Non-Payment Event of Default shall have been cured or waived
in writing or shall have ceased to exist, (y) such Designated Senior
Indebtedness shall have been indefeasibly paid in full in cash or (z) such
Payment Blockage Period shall have been terminated by written notice to the
Issuers or the Trustee from the Representative after which, in the case of
clause (w), (x), (y) or (z), such Issuers shall resume making any and all
required payments in respect of the Notes, including any missed payments.
Notwithstanding any other provisions of this Indenture, in no event shall a
Payment Blockage Period extend beyond 179 days from the date of the receipt by
the Trustee of the notice referred to in this Section 11.03(b) (the "Initial
Blockage Period"). Any number of additional Payment Blockage Periods may be
commenced during the Initial Blockage Period; provided, however, that no such
additional Payment Blockage Period shall extend beyond the Initial Blockage
Period. After the expiration of the Initial Blockage Period, no Payment Blockage
Period may be commenced under this Section 11.03(b) and no Guarantee Payment
Blockage Period may be commenced under Section 10.11(b) hereof until at least
180 consecutive days have elapsed from the last day of the Initial Blockage
Period. Notwithstanding any other provisions of this Indenture, no Non-Payment
Event of Default with respect to Designated Senior Indebtedness which existed or
was continuing on the date of the commencement of any Payment Blockage Period
initiated by the Representative shall be, or be made, the basis for the
commencement of a second Payment Blockage Period initiated by the Representative
unless such event of default shall have been cured or waived for a period of not
less than 90 consecutive days. Notwithstanding the foregoing, if the obligations
of the Issuers under the Notes have been accelerated pursuant to Article 6 of
this Indenture or otherwise, the Trustee shall be deemed to have received notice
from the Representative
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of a Non-Payment Event of Default relating to such acceleration as provided for
in the first sentence of this clause (b).
(c) In the event that, notwithstanding the foregoing, the
Trustee or any Holder receives any payment or distribution of assets of such
Issuer of any kind, whether in cash, Property or securities, including, without
limitation, by way of set-off or otherwise, in respect of the Notes or any
Obligations under the Notes, the Registration Rights Agreement or the Indenture,
before all Senior Indebtedness of such Issuer is indefeasibly paid and satisfied
in full in cash, then such payment or distribution (other than a payment or
distribution from the trust described in Section 9.04) will be held by the
recipient in trust for the benefit of holders of Senior Indebtedness and will be
immediately paid over or delivered to the holders of Senior Indebtedness or
their representative or representatives to the extent necessary to make payment
in full of all Senior Indebtedness remaining unpaid, after giving effect to any
concurrent payment or distribution, or provision therefor, to or for the holders
of Senior Indebtedness.
Section 11.04. Trustee's Relation to Senior Indebtedness.
With respect to the holders of Senior Indebtedness, the
Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article 11, and no implied
covenants or obligations with respect to the holders of Senior Indebtedness
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 Indebtedness and the
Trustee shall not be liable to any holder of Senior Indebtedness (other than for
its willful misconduct or negligence) if it shall mistakenly pay over or deliver
to Holders, any Issuer or any other Person moneys or assets to which any holder
of Senior Indebtedness shall be entitled by virtue of this Article 11 or
otherwise. Nothing in this Section 11.04 shall affect the obligation of any
other such Person receiving such payment or distribution from the Trustee or any
other Agent to hold such payment for the benefit of, and to pay such payment
over to, the holders of Senior Indebtedness.
Section 11.05. Subrogation of Rights of Holders of Senior Indebtedness.
Upon the payment in full of all Senior Indebtedness, the
Holders shall be subrogated to the rights of the holders of such Senior
Indebtedness to receive payments and distributions of cash, Property and
securities applicable to the Senior In-
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debtedness until the principal of, premium, if any and interest on the Notes
shall be paid in full. For purposes of such subrogation, no payments or
distributions to the holders of Senior Indebtedness of any cash, Property or
securities to which the Holders or the Trustee would be entitled except for the
provisions of this Article 11, and no payments over pursuant to the provisions
of this Article 11 to the holders of Senior Indebtedness by Holders or the
Trustee, shall, as among any Issuer, its creditors other than holders of Senior
Indebtedness and the Holders, be deemed to be a payment or distribution by such
Issuer to or on account of the Senior Indebtedness.
If any payment or distribution to which the Holders would
otherwise have been entitled but for the provisions of this Article 11 shall
have been applied, pursuant to the provisions of this Article 11, to the payment
of all amounts payable under the Senior Indebtedness of any Issuer, then and in
such case the Holders shall be entitled to receive from the holders of such
Senior Indebtedness at the time outstanding any payments or distributions
received by such holders of such Senior Indebtedness in excess of the amount
sufficient to pay all amounts payable under or in respect of such Senior
Indebtedness in full in cash.
Section 11.06. Provisions Solely to Define Relative Rights.
The provisions of this Article 11 are and are intended solely
for the purpose of defining the relative rights of the Holders on the one hand
and the holders of Senior Indebtedness on the other hand. Nothing contained in
this Article 11 or elsewhere in this Indenture or in the Notes is intended to or
shall (a) impair, as among any Issuer, its creditors other than holders of
Senior Indebtedness and the Holders, the obligation of the Issuers, which is
absolute and unconditional, to pay to the Holders the principal of, premium, if
any, and interest on the Notes as and when the same shall become due and payable
in accordance with their terms; or (b) affect the relative rights against the
Issuers of the Holders and creditors of the Issuers other than the holders of
Senior Indebtedness; or (c) prevent the Trustee or any Holder from exercising
all remedies otherwise permitted by applicable law upon a Default or an Event of
Default under this Indenture, subject to the rights, if any, under this Article
11 of the holders of Senior Indebtedness (1) in any case, proceeding,
dissolution, liquidation or other winding-up, assignment for the benefit of
creditors or other marshaling of assets and liabilities of the Issuers referred
to in Section 11.02 hereof,
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to receive, pursuant to and in accordance with such Section, cash, property and
securities otherwise payable or deliverable to the Trustee or such Holder, or
(2) under the conditions specified in Section 11.03, to prevent any payment
prohibited by such Section or enforce their rights pursuant to Section 11.03(c)
hereof.
The failure to make a payment on account of principal of,
premium, if any, or interest on the Notes by reason of any provision of this
Article 11 shall not be construed as preventing the occurrence of a Default or
an Event of Default hereunder.
Section 11.07. Trustee to Effectuate Subordination.
Each Holder of a Note by his acceptance thereof authorizes and
directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article and
appoints the Trustee his attorney-in-fact for any and all such purposes,
including, in the event of any dissolution, winding-up, liquidation or
reorganization of any Issuer whether in bankruptcy, insolvency, receivership
proceedings, or otherwise, the timely filing of a claim for the unpaid balance
of the indebtedness of any Issuer owing to such Holder in the form required in
such proceedings and the causing of such claim to be approved. If the Trustee
does not file such a claim prior to 30 days before the expiration of the time to
file such a claim, the holders of Senior Indebtedness, or any Representative, is
hereby authorized to have the right to file such a claim for and on behalf of
the Holders, and the Trustee shall, upon written request, supply such holders
and Representative all information and copies of documents within the Trustee's
possession and relating to the Notes or the Issuers which such holders or
Representatives reasonably request in order to file such claims.
Section 11.08. No Waiver of Subordination Provisions.
(a) No right of any present or future holder of any Senior
Indebtedness to enforce subordination as herein provided shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
any Issuer or by any act or failure to act, in good faith, by any such holder,
or by any non-compliance by any Issuer with the terms, provisions and covenants
of this Indenture, regardless of any knowledge thereof any such holder may have
or be otherwise charged with.
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(b) Without limiting the generality of subsection (a) of this
Section 11.08, the holders of Senior Indebtedness may, at any time and from time
to time, without the consent of or notice to the Trustee or the Holders, without
incurring responsibility to the Holders and without impairing or releasing the
subordination provided in this Article 11 or the obligations hereunder of the
Holders to the holders of Senior Indebtedness, do any one or more of the
following: (1) change the manner, place or terms of payment or extend the time
of payment of, or renew or alter, Senior Indebtedness or otherwise amend or
supplement in any manner Senior Indebtedness of any Issuer or any instrument
evidencing the same or any agreement under which Senior Indebtedness is
outstanding; (2) sell, exchange, release or otherwise deal with any Property
pledged, mortgaged or otherwise securing Senior Indebtedness; (3) release any
Person liable in any manner for the collection or payment of Senior
Indebtedness; and (4) exercise or refrain from exercising any rights against the
Issuers and any other Person; provided, however, that in no event shall any such
actions limit the right of the Holders to take any action to accelerate the
maturity of the Notes pursuant to Article 6 hereof or to pursue any rights or
remedies hereunder or under applicable laws if the taking of such action does
not otherwise violate the terms of this Indenture.
Section 11.09. Notice to Trustee.
(a) The Issuers shall give prompt written notice to the
Trustee of any fact known to the Issuers which would prohibit the making of any
payment to or by the Trustee at its Corporate Trust Office in respect of the
Notes. Notwithstanding the provisions of this Article 11 or any other provision
of this Indenture, the Trustee shall not be charged with knowledge of the
existence of any facts which would prohibit the making of any payment to or by
the Trustee in respect of the Notes, unless and until the Trustee shall have
received written notice thereof from the Issuers or a holder of Senior
Indebtedness or from any trustee, fiduciary or agent therefor; and, prior to the
receipt of any such written notice, the Trustee, subject to the provisions of
this Section 11.09, shall be entitled in all respects to assume that no such
facts exist; provided, however, that if the Trustee shall not have received the
notice provided for in this Section 11.09 in accordance with Section 12.02 at
least two Business Days prior to the date upon which by the terms hereof any
money may become payable for any purpose under this Indenture (including,
without limitation, the payment of the principal of, premium, if any, or
interest on any Note), then, anything herein contained to the contrary
notwithstanding
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but without limiting the rights and remedies of the holders of
Senior Indebtedness or any trustee, fiduciary or agent therefor, the Trustee
shall have full power and authority to receive such money and to apply the same
to the purpose for which such money was received and shall not be affected by
any notice in accordance with Section 12.02 to the contrary which may be
received by it within two Business Days prior to such date; nor shall the
Trustee be charged with knowledge of the curing of any such default or the
elimination of the act or condition preventing any such payment unless and until
the Trustee shall have received an Officers' Certificate to such effect.
(b) Subject to the provisions of Section 7.01 hereof, the
Trustee shall be entitled to rely on the delivery to it of a written notice to
the Trustee and the Issuers by a Person representing itself to be a holder of
Senior Indebtedness (or a trustee, fiduciary or agent therefor) to establish
that such notice has been given by a holder of Senior Indebtedness (or a
trustee, fiduciary or agent therefor); provided, however, that failure to give
such notice to the Issuers shall not affect in any way the ability of the
Trustee to rely on such notice. In the event that the Trustee determines in good
faith that further evidence is required with respect to the right of any Person
as a holder of Senior Indebtedness to participate in any payment or distribution
pursuant to this Article 11, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of
Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article 11, and if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
Section 11.10. Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets of the Issuers
referred to in this Article 11, the Trustee, subject to the provisions of
Section 7.01 hereof, and the Holders shall be entitled to rely upon any order or
decree entered by any court of competent jurisdiction in which such insolvency,
bankruptcy, receivership, liquidation, reorganization, dissolution, winding-up
or similar case or proceeding is pending, or a certificate of the trustee in
bankruptcy, receiver, liquidating trustee, custodian, assignee for the benefit
of creditors, agent or other Person making such payment or distribution,
de-
-137-
livered to the Trustee or to the Holders, for the purpose of ascertaining the
Persons entitled to participate in such payment or distribution, the holders of
Senior Indebtedness and other Indebtedness of any Issuer, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article 11; provided that the foregoing shall
apply only if such court has been fully apprised of the provisions of this
Article 11.
Section 11.11. Rights of Trustee as a Holder of Senior Indebtedness;
Preservation of Trustee's Rights.
The Trustee in its individual capacity shall be entitled to
all the rights set forth in this Article 11 with respect to any Senior
Indebtedness which may at any time be held by it, to the same extent as any
other holder of Senior Indebtedness, and nothing in this Indenture shall deprive
the Trustee of any of its rights as such holder. Nothing in this Article 11
shall apply to claims of, or payments to, the Trustee under or pursuant to
Section 7.07 hereof.
Section 11.12. Article Applicable to Paying Agents.
In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Issuers and be then acting hereunder, the term
"Trustee" as used in this Article 11 shall in such case (unless the context
otherwise requires) be construed as extending to and including such Paying Agent
within its meaning as fully for all intents and purposes as if such Paying Agent
were named in this Article 11 in addition to or in place of the Trustee.
Section 11.13. No Suspension of Remedies.
Nothing contained in this Article 11 shall limit the right of
the Trustee or the Holders to take any action to accelerate the maturity of the
Notes pursuant to Article 6 or to pursue any rights or remedies hereunder or
under applicable law, subject to the rights, if any, under this Article 11 of
the holders, from time to time, of Senior Indebtedness.
Section 11.14. Acceleration of Payment of Notes.
If payment of the Notes is accelerated because of an Event of
Default, the Company or the Trustee shall promptly notify the holders of Senior
Indebtedness of any Issuer or the Representative of such holders of the
acceleration (in the case
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of the Trustee, only to the extent of its actual knowledge of such holders or
the Representative of such holders). Such notice is in addition to, and not in
lieu of, any notice that may be required to be delivered under Section 6.02
prior to the effectiveness of any such acceleration.
ARTICLE 12
MISCELLANEOUS
Section 12.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or
conflicts with another provision which is required to be included in this
Indenture by the TIA, the required provision shall control.
Section 12.02. Notices.
Any notices or other communications required or permitted
hereunder shall be in writing, and shall be sufficiently given if made by hand
delivery, by telex, by telecopier or registered or certified mail, postage
prepaid, return receipt requested, addressed as follows:
If to the Issuers or any Guarantor:
c/o Muzak LLC
2901 Third Avenue
Suite 400
Seattle, Washington 98121
Attention: Brad Bodenman
Tel: (206) 633-3000
Fax: (206) 633-6210
Copy to:
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Laurie Gunther, Esq.
Tel: (312) 861-2000
Fax: (312) 861-2200
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Copy to:
ABRY Partners, Inc.
18 Newbury Street
Boston, Massachusetts 02116
Attention: Peni Garber
Tel: (617) 859-2959
Fax: (617) 859-8797
If to the Trustee:
State Street Bank and Trust Company
2 Avenue de Lafayette
Boston, Massachusetts 02111
Attention: Corporate Trust Department
/Ref: Muzak Senior Subordinated
Floating Rate Notes due 2009
Fax: (617) 662-1460
The Issuers, any Guarantor or the Trustee by written notice to
the others may designate additional or different addresses for subsequent
notices or communications. Any notice or communication to the Issuers, any
Guarantor and the Trustee, shall be deemed to have been given or made as of the
date so delivered if personally delivered; when answered back, if telexed; when
receipt is acknowledged, if telecopied; and five (5) calendar days after mailing
if sent by registered or certified mail, postage prepaid (except that a notice
of change of address shall not be deemed to have been given until actually
received by the addressee).
Any notice or communication mailed to a Noteholder shall be
mailed to him by first-class mail, postage prepaid, at his address shown on the
register kept by the Registrar.
Failure to mail a notice or communication to a Noteholder or
any defect in it shall not affect its sufficiency with respect to other
Noteholders. If a notice or communication to a Noteholder is mailed in the
manner provided above, it shall be deemed duly given, whether or not the
addressee receives it.
In case by reason of the suspension of regular mail service,
or by reason of any other cause, it shall be impossible to mail any notice as
required by this Indenture, then such method of notification as shall be made
with the approval of the Trustee shall constitute a sufficient mailing of such
notice.
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Section 12.03. Communications by Holders with Other Holders.
Noteholders may communicate pursuant to TIA Section 312(b)
with other Noteholders with respect to their rights under this Indenture or the
Notes. The Issuers, the Guarantors, the Trustee, the Registrar and anyone else
shall have the protection of TIA Section 312(c).
Section 12.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Issuers or any
Guarantor to the Trustee to take any action under this Indenture, the Issuers or
such Guarantor, as the case may be, shall furnish to the Trustee if and to the
extent reasonably requested by the Trustee:
(1) an Officers' Certificate (which shall include the
statements set forth in Section 11.05 below) stating that, in the
opinion of the signers, all conditions precedent, if any, provided for
in this Indenture relating to the proposed action have been complied
with; and
(2) an Opinion of Counsel (which shall include the statements
set forth in Section 11.05 below) stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
Section 12.05. Statements Required in Certificate and Opinion.
Each certificate and opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, it or he
has made such examination or investigation as is necessary to enable it
or him to express an informed opin-
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ion as to whether or not such covenant or condition has been complied
with; and
(4) a statement as to whether or not, in the opinion of such
Person, such covenant or condition has been complied with.
Section 12.06. When Treasury Notes Disregarded.
In determining whether the Holders of the required aggregate
principal amount of Notes have concurred in any direction, waiver or consent,
Notes owned by the Issuers, any Guarantor or any other obligor on the Notes or
by any Affiliate of any of them shall be disregarded, except that for the
purposes of determining whether the Trustee shall be protected in relying on any
such direction, waiver or consent, only Notes which the Trustee actually knows
are so owned shall be so disregarded. Notes so owned which have been pledged in
good faith shall not be disregarded if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to the
Notes and that the pledgee is not an Issuer, any Guarantor or any other obligor
upon the Notes or any Affiliate of any of them.
Section 12.07. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at
meetings of Noteholders. The Registrar and Paying Agent may make reasonable
rules for their functions.
Section 12.08. Business Days; Legal Holidays.
A "Business Day" is a day that is not a Legal Holiday. A
"Legal Holiday" is a Saturday, a Sunday, a federally-recognized holiday or a day
on which banking institutions are not required to be open in the State of New
York. If a payment date is a Legal Holiday at a place of payment, payment may be
made at that place on the next succeeding day that is not a Legal Holiday, and
no interest shall accrue for the intervening period.
Section 12.09. Governing Law.
THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO
THE
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JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS INDENTURE OR THE NOTES.
Section 12.10. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture,
loan, security or debt agreement of any Issuer or any Subsidiary thereof. No
such indenture, loan, security or debt agreement may be used to interpret this
Indenture.
Section 12.11. No Recourse Against Others.
A director, officer, employee, stockholder or incorporator, as
such, of any Issuer or any Guarantor shall not have any liability for any
obligations of any Issuer or any Guarantor under the Notes, the Guarantees or
this Indenture or for any claim based on, in respect of or by reason of such
obligations or their creations. Each Noteholder by accepting a Note waives and
releases all such liability. Such waiver and release are part of the
consideration for the issuance of the Notes.
Section 12.12. Successors.
All agreements of each of the Issuers and each Guarantor in
this Indenture and the Notes shall bind their respective successors. All
agreements of the Trustee, any additional trustee and any Paying Agents in this
Indenture shall bind its successor.
Section 12.13. Multiple Counterparts.
The parties may sign multiple counterparts of this Indenture.
Each signed counterpart shall be deemed an original, but all of them together
represent one and the same agreement.
Section 12.14. Table of Contents, Headings, etc.
The table of contents, cross-reference sheet and headings of
the Articles and Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
-143-
Section 12.15. Separability.
Each provision of this Indenture shall be considered separable
and if for any reason any provision which is not essential to the effectuation
of the basic purpose of this Indenture or 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.
IN WITNESS WHEREOF, the parties have caused this Indenture to
be duly executed all as of the date and year first written above.
MUZAK LLC
By: /s/ Robert P. MacInnis
-----------------------
Name: Robert MacInnis
Title: Vice President
MUZAK FINANCE CORP.
By: /s/ Robert P. MacInnis
-----------------------
Name: Robert MacInnis
Title: Vice President
Guarantors:
MUZAK HOLDINGS LLC, a Delaware
limited liability company
By: /s/ Robert P. MacInnis
--------------------------
Name: Robert MacInnis
Title: Vice President
MUZAK CAPITAL CORPORATION, a
Delaware corporation
By: /s/ Robert P. MacInnis
--------------------------
Name: Robert MacInnis
Title: Vice President
MLP ENVIRONMENTAL MUSIC, LLC, a
Washington limited liability
company
By: /s/ Robert P. MacInnis
--------------------------
Name: Robert MacInnis
Title: Vice President
BUSINESS SOUND INC., an Ohio
corporation
By: /s/ Robert P. MacInnis
--------------------------
Name: Robert MacInnis
Title: Vice President
AUDIO ENVIRONMENTS, INC., a
California corporation
By: /s/ Robert P. MacInnis
--------------------------
Name: Robert MacInnis
Title: Vice President
BI ACQUISITION, L.L.C., a
Delaware limited liability company
By: /s/ Robert P. MacInnis
--------------------------
Name: Robert MacInnis
Title: Vice President
BACKGROUND MUSIC BROADCASTERS,
INC., a California corporation
By: /s/ Robert P. MacInnis
--------------------------
Name: Robert MacInnis
Title: Vice President
Trustee:
STATE STREET BANK AND TRUST
COMPANY, as Trustee
By: /s/ Jacqueline A. Bonhomme
------------------------------
Name: Jacqueline A. Bonhomme
Title: Assistant Vice President
EXHIBIT A
---------
(FACE OF NOTE)
[FORM OF NOTE]
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT
OF, U.S. PERSONS, EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE
HOLDER AGREES THAT (1) IT WILL NOT PRIOR TO THE DATE (THE "RESALE RESTRICTION
TERMINATION DATE") THAT IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUANCE OF
THIS NOTE AND THE LAST DATE ON WHICH ANY ISSUER, OR ANY AFFILIATE OF ANY ISSUER,
WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE), RESELL OR
OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO ANY ISSUER OR ANY SUBSIDIARY THEREOF,
(B) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE
WITH RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN
INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE MEANING OF SUBPARAGRAPH (a)(1),
(2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT, PRIOR TO SUCH
TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS BEHALF BY A U.S. BROKER-DEALER) TO
THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS NOTE (THE FORM OF WHICH LETTER
CAN BE OBTAINED FROM THE TRUSTEE), (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E) PURSUANT
TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND (2) WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED
A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY
TRANSFER OF THIS NOTE PRIOR TO THE RESALE RESTRICTION TERMINATION DATE, IF THE
PROPOSED TRANSFER IS BEING MADE PURSUANT TO CLAUSE (C) OR (E) ABOVE, PRIOR TO
SUCH TRANSFER, THE HOLDER WILL BE REQUIRED TO FURNISH TO THE TRUSTEE AND THE
ISSUERS SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS ANY OF THEM
MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO
AN EXEMPTION FROM OR IN A TRANSACTION NOT SUBJECT TO THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM
BY REGULATION S UNDER THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED UPON THE
REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
A-1
No. 1 $12,000,000
MUZAK LLC
MUZAK FINANCE CORP.
Senior Subordinated Floating Rate Notes due 2009
Muzak LLC, a Delaware limited liability company and Muzak
Finance Corp., a Delaware corporation (collectively, the "Issuers", which term
includes any successor entities), for value received promise to pay to CIBC INC.
or registered assigns the principal sum of TWELVE MILLION DOLLARS, on March 15,
2009.
Interest Payment Dates: March 15, June 15, September 15 and
December 15 commencing March 15, 2000
Record Dates: March 1, June 1, September 1 and December 1
Reference is made to the further provisions of this Note
contained herein, which will for all purposes have the same effect as if set
forth at this place.
A-2
IN WITNESS WHEREOF, the Issuers have caused this Note to be
signed manually or by facsimile by their duly authorized officers.
MUZAK LLC
By:
--------------------------
Name:
Title:
By:
--------------------------
Name:
Title:
MUZAK FINANCE CORP.
By:
--------------------------
Name:
Title:
By:
--------------------------
Name:
Title:
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Certificate of Authentication:
This is one of the Senior Subordinated Floating Rate Notes due 2009 referred to
in the within-mentioned Indenture
Dated: February 2, 2000
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By:
--------------------------
Authorized Signatory
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(REVERSE SIDE)
MUZAK LLC
MUZAK FINANCE CORP.
Senior Subordinated Floating Rate Notes due 2009
1. INTEREST.
Muzak, LLC, a Delaware limited liability company (the
"Company"), and Muzak Finance Corp., a Delaware corporation ("Finance Corp." and
together with the Company, the "Issuers"), promise to pay interest on the
principal amount of this Note from the date of original issuance hereof at the
rate per annum, determined as of each Interest Rate Determination Date (as
defined below), equal to (i) from the period commencing on the Issue Date and
through and including July 31, 2000, LIBOR (as defined below) plus 5.00%; (ii)
from the period commencing on August 1, 2000 through and including October 31,
2000, LIBOR (as defined below) plus 7.50%; and (iii) from the period commencing
on November 1, 2000 and through and including the Maturity Date, a fixed rate of
interest equal to the greater of (x) LIBOR (as defined below) plus 7.50% and (y)
the Yield to Worst on the Existing Notes (as determined as of November 1, 2000,
or if such date is not a Business Day the next preceding Business Day) plus
2.50%, in each case as determined by the Calculation Agent. If this Note is
issued on any date other than an Interest Rate Determination Date, this Note
shall, until the immediately succeeding Interest Rate Determination Date, bear
interest at a rate per annum calculated as of the Interest Rate Determination
Date immediately preceding the date of original issuance of this Note. Interest
on this Note will accrue from the most recent date on which interest has been
paid or, if no interest has been paid, from the date of original issuance of
this Note. The Issuers will pay interest quarterly in arrears on each March 15,
June 15, September 15 and December 15 and at stated maturity (each, an "Interest
Payment Date"), commencing March 15, 2000, for the period commencing on and
including the immediately preceding Interest Payment Date and ending on and
including the day next preceding the Interest Payment Date (an "Interest
Period"), with the exception that the first Interest Period shall commence on
and include the date of the original issuance of this Note and end on and
include March 14, 2000.
The Issuers shall pay interest on overdue principal and on
overdue installments of interest from time to time on demand at the rate borne
by this Note (without regard to any applicable grace periods) to the extent
lawful.
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"Determination Date," with respect to an Interest Rate
Determination Date, will be the second London Banking Day preceding the Interest
Rate Determination Date.
"Interest Rate Determination Date" means the first day of each
calendar month in each period described in clauses (i), (ii) and (iii) of the
first sentence of this Paragraph 1; provided that the first Interest Rate
Determination Date shall be the Issue Date; and provided, further, that, with
respect to the period described in clause (iii) of the first sentence of this
Paragraph 1, the "Interest Rate Determination Date" shall be November 1, 2000.
"LIBOR", with respect to any Interest Rate Determination Date,
shall be the rate (expressed as a percentage per annum) for deposits in United
States dollars for a three-month period beginning on the second London Banking
Day (as defined) after the Determination Date (as defined) that appears on
Telerate Page 3750 (as defined) as of 11:00 a.m., London time, on the
Determination Date. If Telerate Page 3750 does not include such a rate or is
unavailable on a Determination Date, LIBOR as of the Interest Rate Determination
Date shall be the arithmetic mean of the rates (expressed as a percentage per
annum) for deposits in a Representative Amount (as defined) in United States
dollars for a three-month period beginning on the second London Banking Day
after the Determination Date that appear on Reuters Screen LIBO Page (as
defined) as of 11:00 a.m., London time, on the Determination Date. If Reuters
Screen LIBO Page does not include two or more rates or is unavailable on a
Determination Date, the Calculation Agent will request the principal London
office of each of four major banks in the London interbank market, as selected
by the Calculation Agent, to provide such bank's offered quotation (expressed as
a percentage per annum), as of approximately 11:00 a.m., London time, on such
Determination Date, to prime banks in the London interbank market for deposits
in a Representative Amount in United States dollars for a three-month period
beginning on the second London Banking Day after the Determination Date. If at
least two such offered quotations are so provided, LIBOR as of the Interest Rate
Determination Date will be the arithmetic mean of such quotations. If fewer than
two such quotations are so provided, the Calculation Agent will request each of
three major banks in New York City, as selected by the Calculation Agent, to
provide such bank's rate (expressed as a percentage per annum), as of
approximately 11:00 a.m., New York City time, on such Determination Date, for
loans in a Representative Amount in United States dollars to leading European
banks for a three-month period beginning on the second London Banking Day after
the Determination Date. If at least two such rates are so provided, LIBOR as of
the Interest Rate Determination Date will be the
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arithmetic mean of such rates. If fewer than two such rates are so provided,
then LIBOR as of the Interest Rate Determination Date will be LIBOR in effect
with respect to the immediately preceding Interest Rate Determination Date.
"London Banking Day" is any day in which dealings in United
States dollars are transacted or, with respect to any future date, are expected
to be transacted in the London interbank market.
"Representative Amount" means a principal amount of not less
than U.S. $1,000,000 for a single transaction in the relevant market at the
relevant time.
"Reuters Screen LIBO Page" means the display designated as
page "LIBO" on The Reuters Monitor Money Rates Service (or such other page as
may replace the LIBO page on that service).
"Telerate Page 3750" means the display designated as "Page
3750" on the Dow Jones Telerate Service (or such other page as may replace Page
3750 on that service).
"Yield to Worst" means, as of the date of determination, (i)
if the trading price of the Existing Notes exceeds 100% of the principal amount
thereof, the yield to March 15, 2004, and (ii) if the trading price of the
Existing Notes equals or is less than 100% of the principal amount thereof, the
yield to the stated maturity date of the Existing Notes.
The amount of interest for each day that this Note is
outstanding (the "Daily Interest Amount") will be calculated by dividing the
interest rate in effect for such day by 360 and multiplying the result by the
principal amount of this Note. The amount of interest to be paid on this Note
for each Interest Period will be calculated by adding the Daily Interest Amounts
for each day in the Interest Period.
All percentages resulting from any of the above calculations
will be rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point, with five one-millionths of a percentage point rounded upwards
(e.g., 9.876545% (or .09876545) being rounded to 9.87655% (or .0987655)) and all
dollar amounts used in or resulting from such calculations will be rounded to
the nearest cent (with one-half cent being rounded upwards).
The interest rate on this Note will in no event be higher than
16.00% per annum (before giving effect to any obligation to pay Additional
Interest (as defined in the Registra-
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tion Rights Agreement), if any) with a maximum cash interest rate of 14.00% per
annum. Any interest in excess of 14.00% (and only such interest in excess of
14.00% per annum) shall be payable by the Issuers through the issuance of
Additional Notes in a principal amount equal to the amount of such interest in
excess of 14.00%; provided that Additional Interest (as defined in the
Registration Rights Agreement) may only be paid in cash and not through the
issuance of Additional Notes.
The Calculation Agent will, upon the request of the holder of
any Note, provide the interest rate then in effect with respect to this Note.
All calculations made by the Calculation Agent in the absence of manifest error
shall be conclusive for all purposes and binding on the Company and the Holders
of this Note.
2. METHOD OF PAYMENT.
The Issuers will pay interest on this Note provided for in
Paragraph 1 above (except defaulted interest) to the person who is the
registered Holder of this Note at the close of business on the March 1, June 1,
September 1 and December 1 preceding the Interest Payment Date (whether or not
such day is a Business Day). The Holder must surrender this Note to a Paying
Agent to collect principal payments. The Issuers will pay principal, premium, if
any, and interest in money of the United States that at the time of payment is
legal tender for payment of public and private debts; provided, however, that
the Issuers may pay principal, premium, if any, and interest by check payable in
such money or in Additional Notes pursuant to Paragraph 1 hereof. The Issuers
may mail an interest check to the Holder's registered address.
3. PAYING AGENT, REGISTRAR AND CALCULATION AGENT.
Initially, State Street Bank and Trust Company, a
Massachusetts banking corporation (the "Trustee"), will act as Paying Agent,
Registrar and Calculation Agent. The Issuers may change any Paying Agent,
Registrar or Calculation Agent without notice to the Holders. Neither the
Issuers nor any of its Subsidiaries or Affiliates may act as Paying Agent or
Calculation Agent but may act as Registrar or co-Registrar.
4. INDENTURE; RESTRICTIVE COVENANTS.
The Issuers issued this Note under an Indenture dated as of
February 2, 2000 (the "Indenture") among the Issuers, the Guarantors and the
Trustee. The terms of this Note include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of 1939 (15
U.S.
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Code Sections 77aaa-77bbbb) as in effect on the date of the Indenture. This Note
is subject to all such terms, and the Holder of this Note is referred to the
Indenture and said Trust Indenture Act for a statement of them. All capitalized
terms in this Note, unless otherwise defined, have the meanings assigned to them
by the Indenture.
The Notes are general unsecured obligations of the Issuers
limited to $50,000,000 aggregate principal amount (excluding any Additional
Notes), $12,000,000 of which were issued on the Issue Date. The Indenture
imposes certain restrictions on, among other things, the incurrence of
indebtedness, the incurrence of liens, the making of certain investments,
mergers and sale of assets, the payments of dividends on or the repurchase of,
capital stock of the Issuers, certain other restricted payments by the Issuers
and their Subsidiaries, certain transactions with, and investments in, their
Affiliates, the creation of Subsidiaries, the issuance of capital stock by
Subsidiaries, the types of businesses which the Issuers and their Subsidiaries
may engage in, the creation of dividend and other payment restrictions affecting
Subsidiaries, certain sale-leaseback transactions and a provision regarding
change-of-control transactions.
5. REDEMPTION.
(a) Optional Redemption. The Issuers may redeem the Notes that
are redeemable at their option, in whole at any time or in part from time to
time (i) from and including the Issue Date through to and including July 31,
2000 at a redemption price of 100% of the principal amount thereof plus accrued
and unpaid interest, if any, to the Redemption Date, (ii) from and including
August 1, 2000 through to and including October 31, 2000 at a redemption price
of 101.50% of the principal amount thereof plus accrued and unpaid interest, if
any, to the Redemption Date and (iii) (A) from and including March 15, 2004
through to and including March 14, 2005 at a redemption price equal to 100% of
the principal amount thereof plus a premium equal to one-half of the interest
rate then borne by the Notes, (B) from and including March 15, 2005 through to
and including March 14, 2006 at a redemption price equal to 100% of the
principal amount thereof plus a premium equal to one-third of the interest rate
then borne by Notes, and (C) from and including March 15, 2006 through to and
including March 14, 2007 at a redemption price equal to 100% of the principal
amount thereof plus a premium equal to one-sixth of the interest rate then borne
by the Notes and (D) from and including March 15, 2007 through to and including
the Maturity Date at a redemption price equal to 100% of the principal amount
thereof, in each
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case plus accrued and unpaid interest, if any, to the Redemption Date.
Except as set forth in subparagraph (b) of this Paragraph 5,
the Issuers may not redeem the Notes at their option on from and including
November 1, 2000 through to and including March 14, 2004.
(b) Redemption with Net Cash Proceeds of Equity Offerings. The
Issuers may redeem up to 35% of the principal amount of the Notes originally
issued under the Indenture, at any time and from time to time from and after
November 1, 2000 but prior to March 15, 2002, at a redemption price equal to
100% of the aggregate principal amount so redeemed plus a premium equal to the
interest rate then borne by the Notes, plus accrued and unpaid interest, if any,
to the Redemption Date out of the net cash proceeds of one or more Equity
Offerings; provided, that at least 65% of the principal amount of the Notes
originally issued under the Indenture remains outstanding immediately after any
such redemption (it being expressly agreed that for purposes of determining
whether this condition is satisfied, Notes owned by the Issuers or any of its
Affiliates shall be deemed not to be outstanding). In order to effect the
foregoing redemption with the proceeds of any Equity Offering, the Issuers shall
make such redemption not more than 60 days following the closing of any such
Equity Offering.
(c) Mandatory Redemption. Subject to compliance with the terms
of the Senior Credit Facility (provided that no amendment to the Senior Credit
Facility which is entered into after the Issue Date and on or before October 31,
2000 shall have terms which are materially more restrictive with respect to the
rights of Holders under this Paragraph 5(c) than the terms of the Senior Credit
Facility as in effect on the Issue Date), if on or before October 31, 2000 any
Issuer or any of its Subsidiaries receives cash proceeds from (x) the issuance
of Capital Stock (other than (A) proceeds of Capital Stock issued to any Issuer
or any Restricted Subsidiary of any Issuer, (B) proceeds from the issuance to
any employee of any Issuer or any Restricted Subsidiary of any Issuer of Common
Stock or options to purchase Common Stock of an Issuer or any Restricted
Subsidiary pursuant to employee stock options and incentive plans in existence
on the Issue Date, (C) the issuance of Capital Stock as consideration for the
acquisition of any Person or any property or assets of any Person in compliance
with the other terms of the Indenture and (D) proceeds from the issuance of
Capital Stock by the Company to any holder of the Company's Capital Stock as of
the Issue Date and from any contribution to the common equity of the Company by
any holder of the Company's Capital Stock as of the Issue Date, not to exceed
$5,000,000 in
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the aggregate) or (y) the incurrence of any Indebtedness (other than (A)
Permitted Indebtedness, (B) the Attributable Indebtedness in respect of any Sale
and Lease-Back Transaction, (C) any Indebtedness of any Person assumed by the
Issuer or any of its Subsidiaries in connection with the acquisitions of such
Person or its property or assets and (D) any Indebtedness issued to the
transferor of any Person, property or assets as consideration for the
acquisition by any Issuer or its Subsidiaries of such Person, property or
assets), the Issuers shall promptly redeem that principal amount of Notes
redeemable with such net proceeds received at the redemption prices set forth
below (expressed as a percentage of the principal amount thereof) plus accrued
and unpaid interest, if any, to the Redemption Date, if redeemed during the
period indicated below:
Period Percentage
- ------ ----------
Issue Date through to and including July 31, 2000 100.000%
August 1, 2000 through to and including October 31, 2000 101.500%
6. NOTICE OF REDEMPTION.
Notice of redemption will be mailed via first class mail at
least 30 days but not more than 60 days prior to the Redemption Date to each
Holder to be redeemed at its registered address as it shall appear on the
register of the Notes maintained by the Registrar. On and after any Redemption
Date, interest will cease to accrue on the Notes or portions thereof called for
redemption unless the Issuers shall fail to redeem any such Note.
7. SUBORDINATION.
The Indebtedness evidenced by the Notes and the payment of
principal of, premium, if any, and interest on the Notes are, to the extent and
in the manner provided in the Indenture, subordinated and subject in right of
payment to the prior payment in full of all Senior Indebtedness as defined in
the Indenture, and this Note is issued subject to such provisions. Each Holder
of this Note, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee, on behalf of such Holder, to
take such action as may be necessary or appropriate to effectuate the
subordination as provided in the Indenture and (c) appoints the Trustee
attorney-in-fact of such Holder for such purpose.
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8. OFFERS TO PURCHASE.
The Indenture requires that certain proceeds from Asset Sales
be used, subject to further limitations contained therein, to make an offer to
purchase certain amounts of Notes in accordance with the procedures set forth in
the Indenture. The Issuers are also required to make an offer to purchase Notes
upon occurrence of a Change of Control in accordance with procedures set forth
in the Indenture.
9. REGISTRATION RIGHTS.
Pursuant to the Registration Rights Agreement among the
Issuers, the Guarantors and CIBC Inc., as purchaser of the Notes, the Issuers
and the Guarantors will be obligated to consummate an exchange offer pursuant to
which the Holder of this Note shall have the right to exchange this Note for
Notes of a separate series issued under the Indenture (or a trust indenture
substantially identical to the Indenture in accordance with the terms of the
Registration Rights Agreement) which have been registered under the Securities
Act, in like principal amount and having substantially identical terms as the
Notes. The Holders shall be entitled to receive certain additional interest
payments in the event such exchange offer is not consummated and upon certain
other conditions, all pursuant to and in accordance with the terms of the
Registration Rights Agreement.
10. DENOMINATIONS, TRANSFER, EXCHANGE.
The Notes are in registered form without coupons in
denominations of $1,000 and integral multiples thereof. A Holder may register
the transfer or exchange of Notes in accordance with the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not register the transfer
of or exchange any Note selected for redemption or register the transfer of or
exchange any Note for a period of 15 days before a selection of Notes to be
redeemed or any Note after it is called for redemption in whole or in part,
except the unredeemed portion of any Note being redeemed in part.
11. PERSONS DEEMED OWNERS.
The registered Holder of this Note may be treated as the owner
of it for all purposes.
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12. UNCLAIMED MONEY.
If money for the payment of principal, premium or interest on
any Note remains unclaimed for two years, the Trustee or Paying Agent will pay
the money back to the Issuers at its request. After that, Holders entitled to
money must look to the Issuers for payment as general creditors unless an
"abandoned property" law designates another person.
13. AMENDMENT, SUPPLEMENT AND WAIVER.
Subject to certain exceptions, the Indenture or the Notes may
be modified, amended or supplemented by the Issuers, the Guarantors and the
Trustee with the consent of the Holders of at least a majority in principal
amount of the Notes then outstanding and any existing Default or compliance with
any provision may be waived in a particular instance with the consent of the
Holders of a majority in principal amount of the Notes then outstanding. Without
the consent of Holders, the Issuers, and the Trustee may amend the Indenture or
the Notes or supplement the Indenture for certain specified purposes including
providing for uncertificated Notes in addition to certificated Notes, and curing
any ambiguity, defect or inconsistency, or making any other change that does not
materially and adversely affect the rights of any Holder.
14. SUCCESSOR ENTITY.
When a successor entity assumes all the obligations of its
predecessor under the Notes and the Indenture and immediately before and
thereafter no Default exists and certain other conditions are satisfied, the
predecessor entity will be released from those obligations.
15. DEFAULTS AND REMEDIES.
Events of Default are set forth in the Indenture. If an Event
of Default (other than an Event of Default pursuant to Section 6.01(g) or (h) of
the Indenture with respect to the Company) occurs and is continuing, the Trustee
by notice to the Company, or the Holders of not less than 25% in aggregate
principal amount of the Notes then outstanding, may declare to be immediately
due and payable the entire principal amount of all the Notes then outstanding
plus accrued but unpaid interest to the date of acceleration; provided, however,
that after such acceleration but before judgment or decree based on such
acceleration is obtained by the Trustee, the Holders of a majority in aggregate
principal amount of the outstanding Notes may, under certain circumstances,
rescind and annul such acceleration and its consequences if all existing Events
of Default, other
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than the nonpayment of principal, premium or interest that has become due solely
because of the acceleration, have been cured or waived and if the rescission
would not conflict with any judgment or decree. No such rescission shall affect
any subsequent Default or impair any right consequent thereto. In case an Event
of Default specified in Section 6.01(g) or (h) of the Indenture occurs, such
principal amount, together with premium, if any, and interest with respect to
all of the Notes, shall be due and payable immediately without any declaration
or other act on the part of the Trustee or the Holders of the Notes.
16. TRUSTEE DEALINGS WITH THE ISSUERS.
The Trustee under the Indenture, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Issuers, and may otherwise deal with the Issuers, as if it were not
Trustee.
17. NO RECOURSE AGAINST OTHERS.
As more fully described in the Indenture, a director, officer,
employee or stockholder, as such, of the Issuers or any Guarantor shall not have
any liability for any obligations of the Issuers or the Guarantors under the
Notes, the Guarantees or the Indenture or for any claim based on, in respect or
by reason of, such obligations or their creation. The Holder of this Note by
accepting this Note waives and releases all such liability. The waiver and
release are part of the consideration for the issuance of this Note.
18. DEFEASANCE AND COVENANT DEFEASANCE.
The Indenture contains provisions for defeasance of the entire
indebtedness on this Note and for defeasance of certain covenants in the
Indenture upon compliance by the Issuers with certain conditions set forth in
the Indenture.
19. 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).
20. CUSIP NUMBERS.
Pursuant to a recommendation promulgated by the Committee on
Uniform Securities Identification Procedures, the Issuers have caused CUSIP
Numbers to be printed on the Notes and
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have directed the Trustee to use CUSIP numbers in notices of redemption as
convenience to Holders of the Notes. 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.
21. GOVERNING LAW.
THE INDENTURE AND THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS
MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. EACH OF THE PARTIES TO THE INDENTURE HAS AGREED TO SUBMIT TO
THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THE INDENTURE OR THIS NOTE.
THE ISSUERS WILL FURNISH TO ANY HOLDER OF A NOTE UPON WRITTEN
REQUEST AND WITHOUT CHARGE A COPY OF THE INDENTURE. REQUESTS MAY BE MADE TO:
MUZAK LLC, 2901 Third Avenue, Suite 400, Seattle, Washington 98121, Attention:
Brad Bodenman.
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ASSIGNMENT
I or we assign and transfer this Note to:
(Insert assignee's social security or tax I.D. number)
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
(Print or type name, address and zip code of assignee)
and irrevocably appoint:
- ---------------------------------------------------------------
- ---------------------------------------------------------------
Agent to transfer this Note on the books of the Issuers. The Agent may
substitute another to act for him.
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Date: Your Signature:
--------------- -----------------------
--------------------------------------
(Sign exactly as your name
appears on the other side of
this Note)
Signature Guarantee:
-------------------------------------------
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Note
purchased by the Issuers pursuant to Section 4.09 or Section 4.16 of the
Indenture, check the appropriate box:
[ ] Section 4.09 [ ] Section 4.16
If you want to have only part of the Note purchased by the
Issuers pursuant to Section 4.09 or Section 4.16 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)
- ---------------------------
Signature Guaranteed
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EXHIBIT B
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FORM OF LEGEND FOR GLOBAL NOTES
Any Global Note authenticated and delivered hereunder shall
bear a legend (which would be in addition to any other legends required in the
case of a Restricted Security) in substantially the following form:
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITORY OR A NOMINEE OF A DEPOSITORY. THIS NOTE IS NOT EXCHANGEABLE
FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY
OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS
NOTE AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY
A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE
DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (A NEW YORK CORPORATION)
("DTC") TO THE ISSUERS OR THEIR AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.
OR SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
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EXHIBIT C
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CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF NOTES
------------------------------------
Re: Senior Subordinated Floating Rate Notes
due 2009 (the "Notes") of Muzak LLC and
Muzak Finance Corp.
---------------------------------------
This Certificate relates to $_______ principal amount of Notes
held in the form of* ___ a beneficial interest in a Global Note or* _______
Certificated Notes by ______ (the "Transferor").
The Transferor:*
[ ] has requested by written order that the Registrar deliver in
exchange for its beneficial interest in the Global Note held by the Depository a
Certificated Note or Certificated Notes in definitive, registered form of
authorized denominations and an aggregate number equal to its beneficial
interest in such Global Note (or the portion thereof indicated above); or
[ ] has requested that the Registrar by written order to exchange or
register the transfer of a Certificated Note or Certificated Notes.
In connection with such request and in respect of each such
Note, the Transferor does hereby certify that the Transferor is familiar with
the Indenture relating to the above captioned Notes and the restrictions on
transfers thereof as provided in Section 2.06 of such Indenture, and that the
transfer of this Note does not require registration under the Securities Act of
1933, as amended (the "Securities Act"), because*:
[ ] Such Note is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 2.06 of the Indenture).
[ ] Such Note is being transferred to a Qualified Institutional Buyer
(as defined in Rule 144A under the Securities Act), in reliance on Rule 144A.
[ ] Such Note is being transferred in reliance on Regulation S under
the Securities Act and a Transferor Certificate substantially in the form of
Exhibit D-1 to the Indenture accompanies this Certificate.
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[ ] Such Note is being transferred in reliance on Rule 144 under the
Securities Act.
[ ] Such Note is being transferred in reliance on and in compliance
with an exemption from the registration requirements of the Securities Act other
than Rule 144A or Rule 144 or Regulation S under the Securities Act to a person
other than an institutional "accredited investor." An opinion of counsel to the
effect that such transfer does not require registration under the Securities Act
accompanies this Certificate.
[ ] Such Note is being transferred to an institutional "accredited
investor" (as defined in Rule 501(a)(1), (2), (3) and (7) under the Securities
Act), who has such knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risks of its investment in the Notes,
and it and any accounts for which it is acting are each able to bear the
economic risk of their investment. An opinion of counsel to the effect that such
transfer does not require registration under the Securities Act and a Transferee
Certificate substantially in the form of Exhibit D-2 to the Indenture
accompanies this Certificate.
------------------------------
[INSERT NAME OF TRANSFEROR]
By:
----------------------------
[Authorized Signatory]
Date:
-----------------------------
*Check applicable box.
C-2
EXHIBIT D-1
-----------
Form of Certificate to Be
Delivered in Connection
with Regulation S Transfers
---------------------------
Re: Senior Subordinated Floating Rate Notes due
2009 (the "Notes") of Muzak LLC
(the "Company") and Muzak Finance Corp.
(together with the Company, the "Issuers")
--------------------------------------------
Ladies and Gentlemen:
In connection with our proposed sale of $____________
aggregate principal amount of the Notes, we confirm that such sale has been
effected pursuant to and in accordance with Regulation S under the Securities
Act of 1933, as amended (the "Securities Act"), and, accordingly, we represent
that:
(1) the offer of the Notes was not made to a person in the
United States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on
our behalf reasonably believed that the transferee was outside the
United States, or (b) the transaction was executed in, on or through
the facilities of a designated offshore securities market and neither
we nor any person acting on our behalf knows that the transaction has
been prearranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer
restrictions applicable to the Notes.
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 mat-
D-1-1
ters covered hereby. Defined terms used herein without definition have the
respective meanings provided in Regulation S.
Very truly yours,
[Name of Transferor]
By:
--------------------------------
[Authorized Signatory]
D-1-2
EXHIBIT D-2
-----------
Accredited Investor Transferee Certificate
------------------------------------------
Muzak LLC
Muzak Finance Corp.
State Street Bank and Trust Company
c/o State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110
Attention: Corporate Trust Department
Ladies and Gentlemen:
In connection with our proposed purchase of $ aggregate
principal amount of the Senior Subordinated Floating Rate Notes due 2009 (the
"Notes") of Muzak LLC (the "Company") and Muzak Finance Corp. (together with the
Company, the "Issuers"), we confirm that:
1. We understand that none of the Notes has been registered
under the Securities Act of 1933, as amended (the "Securities Act"),
and, unless so registered, may not be sold except as permitted in the
following sentence. We agree on our own behalf and on behalf of any
investor account for which we are purchasing any Notes to offer, sell
or otherwise transfer any such Notes prior to the date the "Resale
Restriction Termination Date") that is two years after the later of the
original issuance of this Note and the last date on which any Issuer,
or any Affiliate of any Issuer, was the owner of this Note (or any
predecessor of this Note) except (A) to any Issuer or any subsidiary
thereof, (B) inside the United States to a Qualified Institutional
Buyer in compliance with Rule 144A under the Securities Act, (C) inside
the United States to an Institutional Accredited Investor within the
meaning of subparagraph (a)(1),(2),(3) or (7) of Rule 501 under the
Securities Act that, prior to such transfer, furnishes (or has
furnished on its behalf by a U.S. broker-dealer) to the Trustee a
signed letter substantially in the form of this letter, (D) outside the
United States in an offshore transaction in compliance with Rule 904
under the Securities Act, (E) pursuant to any other available exemption
from the registration requirements of the Securities Act or (F)
pursuant to an effective Registration Statement under the Securities
Act. Each purchaser acknowledges that the Issuers and the Trustee
reserve the right prior to any
D-2-1
offer, sale or other transfer prior to the Resale Restriction
Termination Date of the applicable Notes pursuant to clause (c) or (e)
above to require the delivery of an opinion of counsel, certification
and/or other information satisfactory to the Issuers and the Trustee.
2. We are an Institutional Accredited Investor purchasing such
Notes for our own account or for the account of one or more
Institutional Accredited Investors, and we are acquiring such Notes for
investment purposes and not with a view to, or for offer or sale in
connection with, any distribution in violation of the Securities Act or
the securities laws of any state of the United States and we have such
knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in such
Notes, and we and any accounts for which we are acting are each able to
bear the economic risk of our or its investment in such Notes for an
indefinite period.
3. We acknowledge that we have had access to such financial
and other information, and have been afforded the opportunity to ask
such questions of representatives of the Issuers and receive answers
thereto, as we deem necessary.
We understand that the Trustee will not be required to accept
for registration of transfer any Notes acquired by us, except upon presentation
of evidence satisfactory to the Issuers and the Trustee that the foregoing
restrictions on transfer have been complied with. We further understand that any
Notes purchased by us will be in the form of definitive physical certificates
and that such certificates will bear a legend reflecting the substance of this
paragraph 1 of this letter. We further agree to provide to any person acquiring
any of the Notes from us a notice advising such person that transfers of such
Notes are restricted as stated herein and that certificates representing such
Notes will bear a legend to that effect.
We represent that the Issuers and the Trustee and others are
entitled to rely upon the truth and accuracy of our acknowledgments,
representations and agreements set forth herein, and we agree to notify you
promptly in writing if any of our acknowledgments, representations or agreements
herein cease to be accurate and complete. You are also irrevocably authorized to
produce this letter or a copy hereof to any interested party in any
administrative or legal proceeding or official inquiry with respect to the
matters covered hereby.
D-2-2
We represent to you that we have full power to make the
foregoing acknowledgments, representations and agreements on our own behalf and
on behalf of any investor account for which we are acting as fiduciary agent.
As used herein, the terms "offshore transaction," "United
States" and "U.S. person" have the respective meanings given to them in
Regulation S under the Securities Act.
THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.
Very truly yours,
(Name of Purchaser)
By:
--------------------------
Date:
-------------------------
Upon transfer, the Notes would be registered in the name of
the new beneficial owner as follows:
Name:
-------------------------
Address:
----------------------
D-2-3
EXHIBIT E
---------
[FORM OF NOTATION ON NOTE RELATING TO GUARANTEE]
GUARANTEE
---------
Each Guarantor (the "Guarantor", which term includes any
successor Person under the Indenture) has unconditionally guaranteed, on a
senior subordinated basis, jointly and severally, to the extent set forth in the
Indenture and subject to the provisions of the Indenture, (a) the due an
punctual payment of the principal of and interest on the Notes, whether at
maturity, by acceleration or otherwise, the due and punctual payment of interest
on overdue principal, and, to the extent permitted by law, interest, and the due
and punctual performance of all other Obligations of the Issuers to the
Noteholders or the Trustee all in accordance with the terms set forth in Article
10 of the Indenture, and (b) in case of any extension of time of payment or
renewal of any Notes or any of such other Obligations, that the same will be
promptly paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at stated maturity, by acceleration or otherwise.
The obligations of the undersigned to the Holders of Notes and
to the Trustee pursuant to this Guarantee and the Indenture are expressly set
forth in Article 10 of the Indenture and reference is hereby made to the
Indenture for the precise terms of the Guarantee and all of the other provisions
of the Indenture to which this Guarantee relates.
THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO
PRINCIPLES OF CONFLICTS OF LAW.
This Guarantee is subject to release upon the terms set forth
in the Indenture.
E-1
IN WITNESS WHEREOF, each Guarantor has caused its Guarantee to
be duly executed.
GUARANTORS:
[ ]
By:
-------------------------------
Name:
Title:
[ ]
By:
---------------------------------
Name:
Title:
E-2
EXHIBIT F
---------
FORM OF SUPPLEMENTAL INDENTURE
------------------------------
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated
as of _______________, among [ ] (the "New Guarantor"), a subsidiary of Muzak,
LLC (or its successor), a Delaware limited liability company (the "Company"),
Muzak Finance Corp., a Delaware corporation ("Finance Corp.", and together with
the Company, the "Issuers"), the Guarantors (the "Existing Guarantors") under
the Indenture referred to below, and State Street Bank and Trust Company, as
trustee under the Indenture referred to below (the "Trustee").
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS the Issuers have has heretofore executed and delivered
to the Trustee an Indenture (as such may be amended from time to time, the
"Indenture"), dated as of February 2, 2000, providing for the issuance of up to
an aggregate principal amount of $50,000,000 of Senior Subordinated Floating
Rate Notes due 2009 (the "Notes");
WHEREAS Section 4.22 of the Indenture provides that under
certain circumstances the Issuers is required to cause the New Guarantor to
execute and deliver to the Trustee a supplemental indenture pursuant to which
the New Guarantor shall unconditionally guarantee all of the Issuers'
obligations under the Notes pursuant to a Guarantee on the terms and conditions
set forth herein; and
WHEREAS pursuant to Section 8.01 of the Indenture, the
Trustee, the Issuers and Existing Guarantors are authorized to execute and
deliver this Supplemental Indenture;
NOW THEREFORE, in consideration of the foregoing and for other
good and valuable consideration, the receipt of which is hereby acknowledged,
the New Guarantor, the Issuers, the Existing Guarantors and the Trustee mutually
covenant and agree for the equal and ratable benefit of the Noteholders as
follows:
1. Definitions. (a) Capitalized terms used herein without
definition shall have the meanings assigned to them in the Indenture.
F-1
(b) For all purposes of this Supplemental Indenture, except as
otherwise herein expressly provided or unless the context otherwise requires:
(i) the terms and expressions used herein shall have the same meanings as
corresponding terms and expressions used in the Indenture; and (ii) the words
"herein," "hereof" and "hereby" and other words of similar import used in this
Supplemental Indenture refer to this Supplemental Indenture as a whole and not
to any particular section hereof.
2. Agreement to Guarantee. The New Guarantor hereby agrees,
jointly and severally with all other Guarantors, to guarantee the Issuers'
obligations under the Notes on the terms and subject to the conditions set forth
in Article 10 of the Indenture and to be bound by all other applicable
provisions of the Indenture. From and after the date hereof, the New Guarantor
shall be a Guarantor for all purposes under the Indenture and the Notes.
3. Ratification of Indenture; Supplemental Indentures Part of
Indenture. Except as expressly amended hereby, the Indenture is in all respects
ratified and confirmed and all the terms, conditions and provisions thereof
shall remain in full force and effect. This Supplemental Indenture shall form a
part of the Indenture for all purposes, and every Noteholder heretofore or
hereafter authenticated and delivered shall be bound hereby.
4. Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW.
5. Trustee Makes No Representation. The Trustee makes no
representation as to the validity or sufficiency of this Supplemental Indenture.
6. Counterparts. The parties may sign any number of copies of
this Supplemental Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement.
7. Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction thereof.
F-2
IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed as of the date first above written.
[NEW GUARANTOR]
By:
---------------------------
Name:
Title:
By:
---------------------------
Name:
Title:
MUZAK LLC
By:
---------------------------
Name:
Title:
By:
---------------------------
Name:
Title:
MUZAK FINANCE CORP.
By:
---------------------------
Name:
Title:
By:
---------------------------
Name:
Title:
F-3
EXISTING GUARANTORS:
By:
-------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
STATE STREET BANK AND TRUST
COMPANY, as Trustee
By:
-------------------------------
Name:
Title:
F-4