================================================================================
Bell Technology Group Ltd., as Issuer,
and
Marine Midland Bank, as Trustee
INDENTURE
Dated as of April 30, 1998
$160,000,000
13% Senior Notes Due 2005
================================================================================
Reconciliation and tie between Trust Indenture Act of 1939, as amended, and
Indenture, dated as of April 30, 1998
Trust Indenture Indenture Act Section Section
- ------------------------------------- -------
ss. 310 (a)(1)..........................................609
(a)(2)..........................................609
(b)........................................607, 610
ss. 311 (a).............................................613
ss. 312 (a).............................................701
(c).............................................702
ss. 313 (a).............................................703
(c)........................................703, 704
ss. 314 (a).............................................704
(a)(4).........................................1018
(c)(1)..........................................103
(c)(2)..........................................103
(e).............................................103
ss. 315 (a)..........................................601(b)
(b).............................................602
(c)..........................................601(a)
(d).....................................601(c), 603
(e).............................................514
ss. 316 (a)(last sentence)..............................101 ("Outstanding")
(a)(1)(A)..................................502, 512
(a)(1)(B).......................................513
(b).............................................508
(c).............................................105
ss. 317 (a)(1)..........................................503
(a)(2)..........................................504
(b)............................................1003
ss. 318 (a).............................................108
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of this Indenture.
TABLE OF CONTENTS
PAGE
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions.......................................................1
Section 102. Other Definitions................................................17
Section 103. Compliance Certificates and Opinions.............................18
Section 104. Form of Documents Delivered to Trustee...........................19
Section 105. Acts of Holders..................................................19
Section 106. Notices, etc., to the Trustee, the Company and any Guarantor.....21
Section 107. Notice to Holders; Waiver........................................21
Section 108. Conflict with Trust Indenture Act................................21
Section 109. Effect of Headings and Table of Contents.........................21
Section 110. Successors and Assigns...........................................22
Section 111. Separability Clause..............................................22
Section 112. Benefits of Indenture............................................22
Section 113. Governing Law....................................................22
Section 114. Legal Holidays...................................................22
Section 115. Independence of Covenants........................................22
Section 116. Schedules and Exhibits...........................................22
Section 117. Counterparts.....................................................22
ARTICLE TWO
SECURITY FORMS
Section 201. Forms Generally..................................................23
Section 202. Form of Face of Securities.......................................24
Section 203. Form of Reverse of Securities....................................31
ARTICLE THREE
THE SECURITIES
Section 301. Title and Terms..................................................38
Section 302. Denominations....................................................38
Section 303. Execution, Authentication, Delivery and Dating...................39
Section 304. Temporary Securities.............................................40
Section 305. Registration, Registration of Transfer and Exchange..............40
Section 306. Book Entry Provisions for Global Securities......................41
Section 307. Special Transfer and Exchange Provisions.........................42
Section 308. Mutilated, Destroyed, Lost and Stolen Securities.................44
Section 309. Payment of Interest; Interest Rights Preserved...................45
Section 310. CUSIP, ISIN and CINS Numbers.....................................46
Section 311. Persons Deemed Owners............................................46
Section 312. Cancellation.....................................................46
Section 313. Computation of Interest..........................................46
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ARTICLE FOUR
DEFEASANCE AND COVENANT DEFEASANCE
Section 401. Company's Option to Effect Defeasance or Covenant Defeasance.....47
Section 402. Defeasance and Discharge.........................................47
Section 403. Covenant Defeasance..............................................47
Section 404. Conditions to Defeasance or Covenant Defeasance..................47
Section 405. Deposited Money and U.S. Government Obligations to be Held
in Trust; Other Miscellaneous Provisions.......................49
Section 406. Reinstatement....................................................50
ARTICLE FIVE
REMEDIES
Section 501. Events of Default................................................50
Section 502. Acceleration of Maturity; Rescission and Annulment...............52
Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee..52
Section 504. Trustee May File Proofs of Claim.................................53
Section 505. Trustee May Enforce Claims without Possession of Securities......54
Section 506. Application of Money Collected...................................54
Section 507. Limitation on Suits..............................................54
Section 508. Unconditional Right of Holders to Receive Principal, Premium
and Interest...................................................55
Section 509. Restoration of Rights and Remedies...............................55
Section 510. Rights and Remedies Cumulative...................................55
Section 511. Delay or Omission Not Waiver.....................................55
Section 512. Control by Holders...............................................56
Section 513. Waiver of Past Defaults..........................................56
Section 514. Undertaking for Costs............................................56
Section 515. Waiver of Stay, Extension or Usury Laws..........................56
Section 516. Remedies Subject to Applicable Law...............................57
ARTICLE SIX
THE TRUSTEE
Section 601. Duties of Trustee................................................57
Section 602. Notice of Defaults...............................................58
Section 603. Certain Rights of Trustee........................................58
Section 604. Trustee Not Responsible for Recitals, Dispositions of
Securities or Application of Proceeds Thereof..................59
Section 605. Trustee and Agents May Hold Securities; Collections; etc.........59
Section 606. Money Held in Trust..............................................60
Section 607. Compensation and Indemnification of Trustee and Its Prior Claim..60
Section 608. Conflicting Interests............................................60
Section 609. Trustee Eligibility..............................................60
Section 610. Resignation and Removal; Appointment of Successor Trustee........61
Section 611. Acceptance of Appointment by Successor...........................62
Section 612. Merger, Conversion, Consolidation or Succession to Business......62
Section 613. Preferential Collection of Claims Against Company................63
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 701. Company to Furnish Trustee Names and Addresses of Holders........63
Section 702. Disclosure of Names and Addresses of Holders.....................63
ii
Section 703. Reports by Trustee...............................................64
Section 704. Reports by Company...............................................64
ARTICLE EIGHT
CONSOLIDATION, MERGER, SALE OF ASSETS
Section 801. Company and Guarantors May Consolidate, etc., Only on
Certain Terms..................................................65
Section 802. Successor Substituted............................................66
ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 901. Supplemental Indentures and Agreements without Consent
of Holders.....................................................66
Section 902. Supplemental Indentures and Agreements with Consent of Holders...67
Section 903. Execution of Supplemental Indentures and Agreements..............68
Section 904. Effect of Supplemental Indentures................................68
Section 905. Conformity with Trust Indenture Act..............................68
Section 906. Reference in Securities to Supplemental Indentures...............68
Section 907. Notice of Supplemental Indentures................................69
ARTICLE TEN
COVENANTS
Section 1001. Payment of Principal, Premium and Interest......................69
Section 1002. Maintenance of Office or Agency.................................69
Section 1003. Money for Security Payments to be Held in Trust.................69
Section 1004. Corporate Existence.............................................70
Section 1005. Payment of Taxes and Other Claims...............................71
Section 1006. Maintenance of Properties.......................................71
Section 1007. Maintenance of Insurance........................................71
Section 1008. Limitation on Indebtedness......................................71
Section 1009. Limitation on Restricted Payments...............................73
Section 1010. Limitation on Transactions with Affiliates......................76
Section 1011. Limitation on Liens.............................................76
Section 1012. Limitation on Sale of Assets....................................77
Section 1013. Limitation on Issuances of Guarantees of Indebtedness...........78
Section 1014. Purchase of Securities upon a Change of Control.................78
Section 1015. Limitation on Sale and Leaseback Transactions...................81
Section 1016. Limitation on Subsidiary Capital Stock..........................81
Section 1017. Limitation on Dividends and Other Payment Restrictions
Affecting Subsidiaries........................................81
Section 1018. Limitations on Unrestricted Subsidiaries........................82
Section 1019. Provision of Financial Statements...............................82
Section 1020. Statement by Officers as to Default.............................83
Section 1021. Waiver of Certain Covenants.....................................83
Section 1022. Limitation on Business..........................................83
Section 1023. Deposit of Funds with Escrow Agent..............................83
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
Section 1101. Rights of Redemption............................................84
Section 1102. Applicability of Article........................................84
Section 1103. Election to Redeem; Notice to Trustee...........................84
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Section 1104. Selection by Trustee of Securities to be Redeemed...............84
Section 1105. Notice of Redemption............................................85
Section 1106. Deposit of Redemption Price.....................................86
Section 1107. Securities Payable on Redemption Date...........................86
Section 1108. Securities Redeemed or Purchased in Part........................86
ARTICLE TWELVE
SATISFACTION AND DISCHARGE
Section 1201. Satisfaction and Discharge of Indenture.........................86
Section 1202. Application of Trust Money......................................87
ARTICLE THIRTEEN
COLLATERAL AND SECURITY
Section 1301. Escrow Agreement................................................87
Section 1302. Recording and Opinions..........................................88
Section 1303. Release of Collateral...........................................88
Section 1304. Authorization of Actions to be Taken by the Trustee Under
the Escrow Agreement..........................................89
Section 1305. Authorization of Receipt of Funds by the Trustee Under the
Escrow Agreement..............................................89
Section 1306. Termination of Security Interest................................89
EXHIBIT A Regulation S Certificate
EXHIBIT B Restricted Security Certificate
EXHIBIT C Unrestricted Security Certificate
APPENDIX I Form of Transferee Certificate for Series A Securities
APPENDIX II Form of Transferee Certificate for Series B Securities
iv
INDENTURE, dated as of April 30, 1998, between BELL TECHNOLOGY GROUP
LTD., a Delaware corporation (the "Company"), and MARINE MIDLAND BANK, a New
York banking corporation and trust company, as trustee (the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of 13%
Senior Notes due 2005, Series A (the "Series A Securities"), and an issue of 13%
Senior Notes due 2005, Series B (the "Series B Securities" and, together with
the Series A Securities, the "Securities"), of substantially the tenor and
amount hereinafter set forth, and to provide therefor the Company has duly
authorized the execution and delivery of this Indenture and the Securities;
Pursuant to the terms of a Purchase Agreement, dated as of April 24,
1998, between the Company and ING Baring (U.S.) Securities, Inc., the Company
has agreed to issue and sell 160,000 units (the "Units"), each Unit consisting
of one Series A Security and one warrant ("Warrant") to purchase 3.52 shares of
Common Stock. The Series A Securities and the Warrants included in each Unit
will become separately transferable upon the earliest to occur of (i) 180 days
from the date of issuance of the Securities, (ii) a Change in Control, (iii) the
occurrence of an Event of Default, (iv) the date on which the Registration
Statement or the Exchange Offer Registration Statement is declared effective or
(v) such earlier date as may be determined by the Initial Purchaser (the
"Separation Date").
This Indenture is subject to, and shall be governed by, the
provisions of the Trust Indenture Act that are required to be part of and to
govern indentures qualified under the Trust Indenture Act;
All acts and things necessary have been done to make the Securities,
when duly issued and executed by the Company and authenticated and delivered
hereunder, the valid obligations of the Company and this Indenture a valid
agreement of the Company in accordance with the terms of this Indenture;
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Securities, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article, and include the plural as well as the singular;
1
(b) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(c) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP;
(d) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision;
(e) all references to $, US$, dollars or United States dollars shall
refer to the lawful currency of the United States of America; and
(f) all references herein to particular Sections or Articles refer
to this Indenture unless otherwise so indicated.
Certain terms used principally in Article Four are defined in
Article Four.
"Acquired Indebtedness" means Indebtedness of a Person (i) existing
at the time such Person becomes a Subsidiary or (ii) assumed in connection with
the acquisition of assets from such Person, in each case, other than
Indebtedness incurred in connection with, or in contemplation of, such Person
becoming a Subsidiary or such acquisition, as the case may be, provided that
Indebtedness of such Person which is redeemed, defeased, retired or otherwise
repaid at the time of or immediately upon consummation of the transactions by
which such Person becomes a Subsidiary or such asset acquisition shall not
constitute Acquired Indebtedness.
"Acquired Person" means, with respect to any specified Person, any
other Person which merges with or into or becomes a Subsidiary of such specified
Person.
"Acquisition" means (i) any capital contribution (by means of
transfers of cash or other property to others or payments for property or
services for the account or use of others, or otherwise) by the Company or any
Subsidiary to any other Person, or any acquisition or purchase of Capital Stock
of any other Person by the Company or any Subsidiary, in either case pursuant to
which such Person shall become a Subsidiary or shall be consolidated, merged
with or into the Company or any Subsidiary or (ii) any acquisition by the
Company or any Subsidiary of the assets of any Person which constitute
substantially all of an operating unit or line of business of such Person or
which is otherwise outside of the ordinary course of business of the Company or
such Subsidiary.
"Additional Interest" has the meaning provided in Section 5 of the
Registration Rights Agreement.
"Affiliate" means, with respect to any specified Person, any other
Person directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person. For the purposes of this
definition, "control" when used with respect to any specified Person means the
power to direct the management and policies of such Person, directly or
indirectly, whether through ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a
2
Global Security or beneficial interest therein, the rules and procedures of the
Depositary for such Global Security to the extent applicable to such transaction
and as in effect at the time of such transfer or transaction.
"Asset Sale" means any sale, issuance, conveyance, transfer, lease
or other disposition (including, without limitation, by way of merger,
consolidation or sale and leaseback transaction) (collectively, a "transfer"),
directly or indirectly, in one or a series of related transactions, of: (i) any
Capital Stock of any Subsidiary; (ii) all or substantially all of the properties
and assets of any division or line of business of the Company or its
Subsidiaries; or (iii) any other properties or assets of the Company or any
Subsidiary other than in the ordinary course of business. For the purposes of
this definition, the term "Asset Sale" shall not include any transfer of
properties and assets (A) that is governed by the provisions contained in
Article Eight, (B) that is by the Company to any Subsidiary or by any Subsidiary
to the Company or any other Subsidiary in accordance with the terms of this
Indenture, (C) that is of obsolete equipment in the ordinary course of business,
(D) the Fair Market Value of which in the aggregate does not exceed $200,000 in
any transaction or series of related transactions, (E) that is made in
accordance with the provisions described in Section 1009, (F) which constitutes
the granting of any Permitted Lien and (G) in which assets will be transferred
in exchange for one or more like-kind assets; provided that if the Fair Market
Value of the assets to be transferred by the Company or such Subsidiary under
this clause (G), plus the Fair Market Value of any other consideration paid or
credited by the Company or such Subsidiary exceeds $1 million, such transaction
shall require approval of the Board of Directors of the Company.
"Average Life to Stated Maturity" means, as of the date of
determination with respect to any Indebtedness, the quotient obtained by
dividing (i) the sum of the products of (a) the number of years from the date of
determination to the date or dates of each successive scheduled principal
payment of such Indebtedness multiplied by (b) the amount of each such principal
payment; by (ii) the sum of all such principal payments.
"Bankruptcy Law" means Title 11, United States Bankruptcy Code of
1978, as amended, or any similar United States federal or state law relating to
bankruptcy, insolvency, receivership, winding up, liquidation, reorganization or
relief of debtors or any amendment to, succession to or change in any such law.
"Board of Directors" means the board of directors of the Company or
any duly authorized committee of such board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Book-Entry Security" means any Global Securities bearing the legend
specified in Section 202 evidencing all or part of a series of Securities,
authenticated and delivered to the Depositary for such series or its custodian,
and registered in the name of such Depositary or nominee.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions or trust companies in
The City of New York or the city in which the Corporate Trust Office of the
Trustee is located are authorized or obligated by law, regulation or executive
order to close.
3
"Capital Lease Obligation" of any Person means any obligation of
such Person and its subsidiaries on a consolidated basis under any capital lease
of real or personal property which, in accordance with GAAP, has been recorded
as a capital lease obligation.
"Capital Stock" means (i) with respect to any Person that is a
corporation, any and all shares, interests, participations or other equivalents
(however designated and whether or not voting) of corporate stock, including
each class of common stock and preferred stock of such Person and (ii) with
respect to any Person that is not a corporation, any and all partnership,
membership or other equity interests of such Person.
"Cash Equivalents" means (i) any evidence of Indebtedness, maturing
not more than one year after the date of acquisition, issued by the United
States of America, or an instrumentality or agency thereof, and guaranteed fully
as to principal, premium, if any, and interest by the United States of America,
(ii) any certificate of deposit, maturing not more than one year after the date
of acquisition, issued by, or time deposit of, a commercial banking institution
that is a member of the Federal Reserve System and that has combined capital and
surplus and undivided profits of not less than $500 million, whose short term
debt has a rating, at the time as of which any investment therein is made, of
"P-1" (or higher) according to Moody's or any successor rating agency or "A-1"
(or higher) according to S&P or any successor rating agency, (iii) commercial
paper, maturing not more than 270 days after the date of acquisition, issued by
a corporation (other than an Affiliate or subsidiary of the Company) organized
and existing under the laws of the United States of America with a rating, at
the time as of which any investment therein is made, of "P-1" (or higher)
according to Moody's or "A-1" (or higher) according to S&P and (iv) any money
market deposit accounts issued or offered by a domestic commercial bank having
capital and surplus in excess of $500 million; provided that the short term debt
of such commercial bank has a rating, at the time of Investment, of "P-1" (or
higher) according to Moody's or "A-1" (or higher) according to S&P.
"Change of Control" means the occurrence of any of the following
events: (i) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Exchange Act) is or becomes the "beneficial owner" (as defined
in Rules 13d-3 and 13d-5 under the Exchange Act, except that a Person shall be
deemed to have beneficial ownership of all shares that such Person has the right
to acquire, whether such right is exercisable immediately or only after the
passage of time), directly or indirectly, of more than 50% of the total
outstanding Voting Stock of the Company; (ii) 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 to such board or whose nomination for election by the stockholders of
the Company was approved by a vote of a majority of the directors then still in
office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved), cease for any
reason to constitute a majority of such Board of Directors then in office; (iii)
the Company consolidates with or merges with or into any Person or conveys,
transfers or leases all or substantially all of its assets to any Person, or any
corporation consolidates with or merges into or with the Company, in any such
event, pursuant to a transaction in which the outstanding Voting Stock of the
Company is changed into or exchanged for cash, securities or other property,
other than any such transaction where the outstanding Voting Stock of the
Company is not changed or exchanged at all (except to the extent necessary to
reflect a change in the jurisdiction of incorporation of the Company or where no
"person" or "group" owns, immediately after such transaction, directly or
indirectly, more than 50% of the total outstanding Voting Stock of the surviving
corporation); or (iv) the Company is liquidated or dissolved or adopts a plan of
liquidation or dissolution.
"Code" means the Internal Revenue Code of 1986, as amended.
4
"Collateral" has the meaning provided in Section 6 of the Escrow
Agreement.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or if at any time
after the execution of this Indenture such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Commodity Price Protection Agreement" means any forward contract,
commodity swap, commodity option or other similar financial agreement or
arrangement relating to, or the value of which is dependent upon, fluctuations
in commodity prices.
"Common Stock" means the common stock, par value $0.01 per share, of
the Company.
"Company" means Bell Technology Group Ltd., a corporation
incorporated under the laws of the State of Delaware, until a successor Person
shall have become such pursuant to the applicable provisions of this Indenture,
and thereafter "Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or
order signed in the name of the Company by any one of its President, its Chief
Executive Officer, its Chief Financial Officer or a Vice President (regardless
of Vice Presidential designation), and by any one of its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the
Trustee.
"consolidated" means, consolidated in accordance with GAAP.
"Consolidated Income Tax Expense" of any Person means, for any
period, the provision for federal, state, local and foreign income taxes of such
Person and its consolidated subsidiaries for such period as determined in
accordance with GAAP.
"Consolidated Interest Expense" of any Person means, without
duplication, for any period, the sum of (a) the interest expense of such Person
and its subsidiaries for such period, on a consolidated basis, including,
without limitation, (i) amortization of debt discount, (ii) the net costs
associated with Interest Rate Agreements, Currency Hedging Arrangements and
Commodity Price Protection Agreements (including amortization of discounts),
(iii) the interest portion of any deferred payment obligation, (iv) accrued
interest and (v) all commissions, discounts and other fees and charges owed with
respect to letters of credit and bankers' acceptance financing and similar
transactions, plus (b) (i) the interest component of the Capital Lease
Obligations paid, accrued and/or scheduled to be paid or accrued by such Person
and its subsidiaries during such period and (ii) all capitalized interest of
such Person and its subsidiaries, plus (c) the interest expense actually paid by
such Person under any Guaranteed Debt of such Person and any subsidiary of such
Person to the extent not included under clause (a)(iv) above, plus (d) the
aggregate amount for such period of cash or non-cash dividends on any Redeemable
Capital Stock or Preferred Stock of such Person and its subsidiaries, in each
case as determined on a consolidated basis in accordance with GAAP.
"Consolidated Net Income" means, with respect to any period, the net
income of the Company and any Subsidiary for such period determined on a
consolidated basis in accordance with GAAP, adjusted, to the extent included in
calculating such net income, by excluding, without duplication, (a) other than
for purposes of calculating the Basket, all extraordinary, unusual or
non-recurring gains or losses for such period (net of fees and expenses relating
to the transaction giving rise thereto); (b) other
5
than for purposes of calculating the Basket, all gains or losses from the sales
or other dispositions of assets out of the ordinary course of business (net of
taxes, fees and expenses relating to the transaction giving rise thereto) for
such period; (c) that portion of such net income derived from or in respect of
Investments in Persons other than Subsidiaries, except to the extent actually
received in cash by the Company or any Subsidiary (subject, in the case of any
Subsidiary, to the provisions of clause (f) of this definition); (d) the portion
of such net income (or loss) allocable to minority interests in any Person
(other than a Subsidiary) for such period, except to the extent the Company's
allocation portion of such Person's net income for such period is actually
received in cash by the Company or any Subsidiary (subject, in the case of any
Subsidiary, to the provisions of clause (f) of this definition); (e) the net
income (or loss) of any other Person combined with the Company or any Subsidiary
on a "pooling of interests" basis attributable to any period prior to the date
of combination; (f) the net income of any Subsidiary to the extent that the
declaration of dividends or similar distributions by that Subsidiary of that
income is not at the time (regardless of any waiver) permitted, directly or
indirectly, by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulations
applicable to that Subsidiary or its Capital Stock holders; and (g) any gain or
loss, net of taxes realized by such Person upon the termination of any employee
pension benefit plan.
"Consolidated Operating Cash Flow" means, with respect to any
period, Consolidated Net Income for such period increased (without duplication),
to the extent deducted in calculating such Consolidated Net Income, by (a)
Consolidated Income Tax Expense for such period; (b) Consolidated Interest
Expense for such period; and (c) depreciation, amortization and any other
non-cash items for such period (other than any non-cash item which requires the
accrual of, or a reserve for, cash charges for any future period) of the Company
and any Subsidiary, including, without limitation, amortization of capitalized
debt issuance costs for such period, all of the foregoing determined on a
consolidated basis in accordance with GAAP minus non-cash items to the extent
they increase consolidated Net Income (including the partial or entire reversal
of reserves taken in prior periods) for such period.
"Corporate Trust Office" means the office of the Trustee or an
affiliate or agent thereof at which at any particular time the corporate trust
business for the purposes of this Indenture shall be principally administered,
which office at the date of execution of this Indenture is located at 140
Broadway, 12th Floor, New York, New York 10005.
"Cumulative Operating Cash Flow" means, as at any date of
determination, the positive cumulative Consolidated Operating Cash Flow realized
during the period commencing on the original issue date of the Securities and
ending on the last day of the most recent fiscal quarter immediately preceding
the date of determination for which consolidated financial information of the
Company is available or, if such cumulative Consolidated Operating Cash Flow for
such period is negative, the negative amount by which cumulative Consolidated
Operating Cash Flow is less than zero.
"Currency Hedging Arrangements" means one or more of the following
agreements which shall be entered into by one or more financial institutions:
foreign exchange contracts, currency swap agreements or other similar agreements
or arrangements designed to protect against the fluctuations in currency values.
"Debt to Annualized Operating Cash Flow Ratio" means, as of the date
of determination, the ratio of (a) the Total Consolidated Indebtedness as of the
date of calculation (the "Determination Date") to (b) two times the Consolidated
Operating Cash Flow for the latest two fiscal quarters for which financial
information is available immediately preceding such Determination Date (the
"Measurement Period"). For purposes of calculating Consolidated Operating Cash
Flow for the Measurement Period immediately prior
6
to the relevant Determination Date, (i) any Person that is a Subsidiary on the
Determination Date (or would become a Subsidiary on such Determination Date in
connection with the transaction that requires the determination of such
Consolidated Operating Cash Flow) will be deemed to have been a Subsidiary at
all times during such Measurement Period, (ii) any Person that is not a
Subsidiary on such Determination Date (or would cease to be a Subsidiary on such
Determination Date in connection with the transaction that requires the
determination of such Consolidated Operating Cash Flow) will be deemed not to
have been a Subsidiary at any time during such Measurement Period, and (iii) if
the Company or any Subsidiary shall have in any manner (x) acquired (through an
Acquisition or the commencement of activities constituting such operating
business) or (y) disposed of (by means of an Asset Sale or the termination or
discontinuance of activities constituting such operating business) any operating
business during such Measurement Period or after the end of such period and on
or prior to such Determination Date, such calculation will be made on a pro
forma basis in accordance with GAAP as if, in the case of an Acquisition or the
commencement of activities constituting such operating business, all such
transactions had been consummated prior to the first day of such Measurement
Period (it being understood that in calculating Consolidated Operating Cash Flow
the exclusions set forth in clauses (a) through (g) of the definition of
Consolidated Net Income shall apply to an Acquired Person as if it were a
Subsidiary).
"Default" means any event which is, or after notice or passage of
any time or both would be, an Event of Default.
"Depositary" means, with respect to the Securities issued in the
form of one or more Book-Entry Securities, The Depository Trust Company ("DTC"),
its nominees and successors, or another Person designated as Depositary by the
Company, which must be a clearing agency registered under the Exchange Act.
"Disinterested Director" means, with respect to any transaction or
series of related transactions, a member of the Board of Directors of the
Company who does not have any material direct or indirect financial interest in
or with respect to such transaction or series of related transactions.
"Disqualified Stock" means, with respect to any Person, any Capital
Stock which, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable), or upon the happening of any
event, matures or becomes mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or becomes exchangeable for Indebtedness at the option
of the holder thereof, or becomes redeemable at the option of the holder
thereof, in whole or in part, on or prior to the final maturity date of the
Securities; provided such Capital Stock shall only constitute Disqualified Stock
to the extent it so matures or becomes so redeemable or exchangeable on or prior
to the final maturity date of the Securities; provided, further, that any
Capital Stock that would not constitute Disqualified Stock but for provisions
thereof giving holders thereof the right to require such Person to repurchase or
redeem such Capital Stock upon the occurrence of an "asset sale" or "change of
control" occurring prior to the final maturity date of the Securities shall not
constitute Disqualified Stock if the "asset sale" or "change of control"
provisions applicable to such Capital Stock are no more favorable to the holders
of such Capital Stock than the provisions contained in Section 1012 and Section
1014 and such Capital Stock specifically provides that such Person will not
repurchase or redeem any such stock pursuant to such provision prior to the
Company's repurchase of such Securities as are required to be repurchased
pursuant to Section 1012 and Section 1014.
"Escrow Account" has the meaning set forth in Section 2 of the
Escrow Agreement.
"Escrow Agent" means Marine Midland Bank, as escrow agent under the
Escrow
7
Agreement, until a successor replaces it in accordance with the provisions of
the Escrow Agreement and thereafter means such successor.
"Escrow Agreement" means the Escrow and Security Agreement, dated as
of the date hereof, among the Company, the Escrow Agent and the Trustee.
"Escrow Funds" has the meaning specified in the Escrow Agreement.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any successor statute, and the rules and regulations promulgated
thereunder.
"Exchange Offer" means the exchange offer by the Company of Series B
Securities for Series A Securities to be effected pursuant to Section 3 of the
Registration Rights Agreement.
"Exchange Offer Registration Statement" means the registration
statement under the Securities Act contemplated by Section 3(a) of the
Registration Rights Agreement.
"Fair Market Value" means, with respect to any asset or property,
the sale value that would be reasonably expected to be obtained in an
arm's-length transaction between an informed and willing seller under no
compulsion to sell and an informed and willing buyer under no compulsion to buy.
Unless otherwise specified, Fair Market Value shall be determined by the Board
of Directors of the Company acting in good faith and shall be evidenced by a
Board Resolution.
"Generally Accepted Accounting Principles" or "GAAP" means generally
accepted accounting principles in the United States, consistently applied, which
are in effect on the date hereof.
"Global Securities" means the Rule 144A Global Securities, the
Regulation S Global Securities and the Series B Global Securities to be issued
as Book-Entry Securities issued to the Depositary in accordance with Section
306.
"Guarantee" means the guarantee by any Guarantor of the Company's
Indenture Obligations.
"Guaranteed Debt" of any Person means, without duplication, all
Indebtedness of any other Person guaranteed directly or indirectly in any manner
by such Person, or in effect guaranteed directly or indirectly by such Person
through an agreement (i) to pay or purchase such Indebtedness or to advance or
supply funds for the payment or purchase of such Indebtedness, (ii) to purchase,
sell or lease (as lessee or lessor) property, or to purchase or sell services,
primarily for the purpose of enabling the debtor to make payment of such
Indebtedness or to assure the holder of such Indebtedness against loss, (iii) to
supply funds to, or in any other manner invest in, the debtor (including any
agreement to pay for property or services without requiring that such property
be received or such services be rendered), (iv) to maintain working capital or
equity capital of the debtor, or otherwise to maintain the net worth, solvency
or other financial condition of the debtor or (v) otherwise to assure a creditor
against loss; provided that the term "guarantee" shall not include endorsements
for collection or deposit, in either case, in the ordinary course of business.
8
"Guarantor" means any Subsidiary which is a guarantor of the
Securities, including any Person that is required after the date hereof to
execute a guarantee of the Securities pursuant to Section 1013 until a successor
replaces such party pursuant to the applicable provisions of this Indenture and,
thereafter, shall mean such successor.
"Holder" means a Person in whose name a Security is registered in
the Security Register.
"Incur" means, with respect to any Indebtedness or other obligation
of any Person, to create, issue, incur (including 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" and "Incurring" shall have meanings
correlative to the foregoing). Indebtedness of a Person existing at the time
such Person becomes a Subsidiary or is merged or consolidated with or into the
Company or any Subsidiary shall be deemed to be Incurred at such time.
"Indebtedness" means, with respect to any Person, without
duplication, (i) all indebtedness of such Person for borrowed money or for the
deferred purchase price of property or services, excluding any trade payables
and other accrued current liabilities arising in the ordinary course of
business, (ii) all obligations of such Person evidenced by bonds, notes,
debentures or other similar instruments, (iii) all indebtedness created or
arising under any conditional sale or other title retention agreement with
respect to property acquired by such Person (unless the rights and remedies of
the seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), but excluding trade payables arising in
the ordinary course of business, (iv) all obligations under Interest Rate
Agreements, Currency Hedging Arrangements or Commodity Price Protection
Agreements of such Person, (v) all Capital Lease Obligations of such Person,
(vi) all Indebtedness referred to in clauses (i) through (v) above of other
Persons and all dividends of other Persons, the payment of which is secured by
(or for which the holder of such Indebtedness has an existing right, contingent
or otherwise, to be secured by) any Lien, upon or with respect to property
(including, without limitation, accounts and contract rights) owned by such
Person, even though such Person has not assumed or become liable for the payment
of such Indebtedness, (vii) all Redeemable Capital Stock issued by such Person
valued at the greater of its voluntary or involuntary maximum fixed repurchase
price plus accrued and unpaid dividends, and (viii) any amendment, supplement,
modification, deferral, renewal, extension, refunding or refinancing of any
liability of the types referred to in clauses (i) through (vii) above. For
purposes hereof, the "maximum fixed repurchase price" of any Redeemable Capital
Stock which does not have a fixed repurchase price shall be calculated in
accordance with the terms of such Redeemable Capital Stock as if such Redeemable
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 Redeemable Capital Stock, such Fair
Market Value to be determined in good faith by the board of directors of the
issuer of such Redeemable Capital Stock. In no event shall "Indebtedness"
include any trade payable or other current liabilities arising in the ordinary
course of business excluding the current maturity of any obligation which would
otherwise constitute Indebtedness. The amount of any item of Indebtedness shall
be the amount of such Indebtedness properly classified as a liability on a
balance sheet prepared in accordance with GAAP.
"Indenture" means this instrument as originally executed (including
all exhibits and schedules hereto) and as it may from time to time be
supplemented or amended by one or more indentures supplemental hereto entered
into pursuant to the applicable provisions hereof.
"Indenture Obligations" means the obligations of the Company and any
other obligor
9
under this Indenture or under the Securities, including any Guarantor, to pay
principal of, premium, if any, and interest when due and payable, and all other
amounts due or to become due under or in connection with this Indenture, the
Securities and the performance of all other obligations to the Trustee and the
Holders under this Indenture and the Securities, according to the respective
terms thereof.
"Initial Purchaser" means ING Baring (U.S.) Securities, Inc.
"interest" includes Additional Interest, if any.
"Interest Payment Date" means the Stated Maturity of an installment
of interest on the Securities.
"Interest Rate Agreements" means one or more of the following
agreements which shall be entered into by one or more financial institutions:
interest rate protection agreements (including, without limitation, interest
rate swaps, caps, floors, collars and similar agreements) and/or other types of
interest rate hedging agreements from time to time.
"Internet Service Business" means any business whose principal
business is operating an internet connectivity or internet enhancement service
as it exists from time to time, including, without limitation, dial up or
dedicated internet service, web hosting or co-location services, security
solutions, the provision and development of software in connection therewith,
configuration services, electronic commerce, intranet solutions, data backup and
restoral, business content and collaboration, communications tools or network
equipment products or services (including without limitation, any business
conducted by the Company or any subsidiary on the Issue Date of the Securities),
and any business reasonably related to the foregoing. A good faith determination
by a majority of the Board of Directors as to whether a business meets the
requirements of this definition shall be conclusive, absent manifest error.
"Investment" means, with respect to any Person, directly or
indirectly, any advance, loan (including guarantees), or other extension of
credit or capital contribution to (by means of any transfer of cash or other
property to others or any payment for property or services for the account or
use of others), or any purchase, acquisition or ownership by such Person of any
Capital Stock, bonds, notes, debentures or other securities issued or owned by
any other Person and all other items that would be classified as investments on
a balance sheet prepared in accordance with GAAP.
"Issue Date" means the date on which the Securities are originally
issued under this Indenture.
"Lien" means any mortgage or deed of trust, pledge, lien (statutory
or otherwise), security interest, easement, hypothecation, or other encumbrance
upon or with respect to any property of any kind, real or personal, movable or
immovable, now owned or hereafter acquired. A Person shall be deemed to own
subject to a Lien any property which such Person has acquired or holds subject
to the interest of a vendor or lessor under any conditional sale agreement,
capital lease or other title retention agreement, other than any lease properly
classified as an operating lease under GAAP and intellectual property licensing
arrangements.
"Maturity" means, when used with respect to the Securities, the date
on which the principal of the Securities becomes due and payable as therein
provided or as provided in this Indenture,
10
whether at Stated Maturity, the Offer Date or the redemption date and whether by
declaration of acceleration, Offer in respect of Excess Proceeds, Change of
Control Offer in respect of a Change of Control, call for redemption or
otherwise.
"Measurement Period" has the meaning as set forth in the definition
of Debt to Annualized Operating Cash Flow Ratio in this Section 101.
"Moody's" means Moody's Investors Service, Inc. or any successor
rating agency.
"Net Cash Proceeds" means (a) with respect to any Asset Sale by any
Person, the proceeds thereof (without duplication in respect of all Asset Sales)
in the form of cash or Cash Equivalents including payments in respect of
deferred payment obligations when received in the form of, or stock or other
assets when disposed of for, cash or Cash Equivalents (except to the extent that
such obligations are financed or sold with recourse to the Company or any
Subsidiary) net of (i) brokerage commissions and other reasonable fees and
expenses (including fees and expenses of counsel and investment bankers) related
to such Asset Sale, (ii) provisions for all taxes payable as a result of such
Asset Sale, (iii) payments made to retire Indebtedness where payment of such
Indebtedness is secured by the assets or properties that are the subject of such
Asset Sale, (iv) amounts required to be paid to any Person (other than the
Company or any Subsidiary) owning a beneficial interest in the assets subject to
the Asset Sale and (v) appropriate amounts to be provided by the Company or any
Subsidiary, as the case may be, as a reserve, in accordance with GAAP, against
any liabilities associated with such Asset Sale and retained by the Company or
any Subsidiary, as the case may be, after such Asset Sale, including, without
limitation, pension and other post-employment benefit liabilities, liabilities
related to environmental matters and liabilities under any indemnification
obligations associated with such Asset Sale, all as reflected in an Officers'
Certificate delivered to the Trustee and (b) with respect to any issuance or
sale of Capital Stock or options, warrants or rights to purchase Capital Stock,
or debt securities or Capital Stock that have been converted into or exchanged
for Capital Stock as referred to in Section 1009, the proceeds of such issuance
or sale in the form of cash or Cash Equivalents including payments in respect of
deferred payment obligations when received in the form of, or stock or other
assets when disposed of for, cash or Cash Equivalents (except to the extent that
such obligations are financed or sold with recourse to the Company or any
Subsidiary), net of attorney's fees, accountant's fees and brokerage,
consultation, underwriting and other fees and expenses actually incurred in
connection with such issuance or sale (or conversion in the case of debt
securities or Capital Stock that have been converted) and net of taxes paid or
payable as a result thereof.
"Non-U.S. Person" means a Person that is not a "U.S. person" as
defined in Regulation S under the Securities Act.
"Officers' Certificate" means a certificate signed by the President,
the Chief Executive Officer, the Chief Financial Officer or a Vice President
(regardless of Vice Presidential designation), and by the Treasurer, an
Assistant Treasurer, the Secretary or an Assistant Secretary, of the Company or
any Guarantor, as the case may be, and in form and substance reasonably
satisfactory to, and delivered to, the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company, any Guarantor or the Trustee, unless an Opinion of
Independent Counsel is required pursuant to the terms of this Indenture, and who
shall be acceptable to the Trustee, and which opinion shall be in form and
substance reasonably satisfactory to the Trustee.
"Opinion of Independent Counsel" means a written opinion of counsel,
who may be
11
regular outside counsel for the Company, but which is issued by a Person who is
not an employee or consultant (other than non-employee legal counsel) of the
Company, or any Guarantor and who shall be reasonably acceptable to the Trustee,
and which opinion shall be in form and substance reasonably satisfactory to the
Trustee.
"Outstanding" when used with respect to the Securities means, as of
the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(a) Securities, or portions thereof, theretofore canceled by the
Trustee or delivered to the Trustee for cancellation;
(b) Securities, or portions thereof, for whose payment or redemption
money in the necessary amount has been theretofore deposited with the
Trustee or any Paying Agent (other than the Company) in trust or set aside
and segregated in trust by the Company (if the Company shall act as its
own Paying Agent) for the Holders of such Securities; provided that if
such Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture or provision therefor reasonably
satisfactory to the Trustee has been made;
(c) Securities, except to the extent provided in Sections 402 and
403, with respect to which the Company has effected defeasance or covenant
defeasance as provided in Article Four; and
(d) Securities in exchange for or in lieu of which other Securities
have been authenticated and delivered pursuant to this Indenture, other
than any such Securities in respect of which there shall have been
presented to the Trustee and the Company proof reasonably satisfactory to
each of them that such Securities are held by a bona fide purchaser in
whose hands the Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company, any Guarantor, or any other obligor upon the Securities or any
Affiliate of the Company, any Guarantor or such other obligor shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Securities which a
Responsible Officer of the Trustee knows to be so owned shall be so disregarded.
Securities so owned which have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the reasonable satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company, any Guarantor or any other obligor upon the
Securities or any Affiliate of the Company, any Guarantor or such other obligor.
"Pari Passu Indebtedness" means (a) any Indebtedness of the Company
which ranks pari passu in right of payment to the Securities and (b) with
respect to any Guarantee, Indebtedness which ranks pari passu in right of
payment to such Guarantee.
"Paying Agent" means any Person (including the Company) authorized
by the Company to pay the principal of, premium, if any, or interest on, any
Securities on behalf of the Company.
"Permitted Investment" means (i) Investments in any Wholly Owned
Subsidiary or any
12
Person which, as a result of such Investment, (a) becomes a Wholly Owned
Subsidiary or (b) is merged or consolidated with or into, or transfers or
conveys all or substantially all of its assets to, or is liquidated into, the
Company or any Wholly Owned Subsidiary; (ii) Indebtedness of the Company or a
Subsidiary described under clauses (iv) and (vii) of paragraph (b) of Section
1008; (iii) Investments in any of the Securities; (iv) Investments in Cash
Equivalents; (v) Investments acquired by the Company or any Subsidiary in
connection with an Asset Sale permitted under Section 1012 to the extent such
Investments are non-cash proceeds as permitted under such covenant; (vi)
Investments in existence on the date of this Indenture; (vii) guarantees of
Indebtedness of a Wholly Owned Subsidiary given by the Company or another Wholly
Owned Subsidiary and guarantees of Indebtedness of the Company given by any
Subsidiary, in each case, in accordance with the terms of this Indenture; (viii)
any Investment in the Company by any Subsidiary of the Company; provided, that
any such Investment in the form of Indebtedness shall be Subordinated
Indebtedness; (ix) accounts receivable created or acquired in the ordinary
course of business of the Company or any Subsidiary and Investments arising from
transactions by the Company or any Subsidiary with trade creditors or customers
in the ordinary course of business (including any such Investment received
pursuant to any plan of reorganization or similar arrangement pursuant to the
bankruptcy or insolvency of such trade creditors or customers or otherwise in
settlement of a claim); (x) Investments the consideration of which is Capital
Stock of the Company; (xi) stock obligations or securities received in
satisfaction of judgments; (xii) Investments in prepaid expenses, negotiable
instruments held for collection, and lease, utility and workers' compensation,
performance and other similar deposits; and (xiii) any other Investments in an
Internet Service Business in an aggregate amount not to exceed $20 million at
any one time outstanding, paid or contributed. In connection with any assets or
property contributed or transferred to any Person as an Investment, such
property and assets shall be equal to the Fair Market Value (as determined by
the Company's Board of Directors in good faith and evidenced by a Board
Resolution) at the time of such Investment.
"Permitted Lien" means:
(a) any Lien existing as of the date of this Indenture;
(b) any Lien arising by reason of (1) any judgment, decree or order
of any court, so long as such Lien is adequately bonded and any
appropriate legal proceedings which may have been duly initiated for the
review of such judgment, decree or order shall not have been finally
terminated or the period within which such proceedings may be initiated
shall not have expired; (2) taxes not yet delinquent or which are being
contested in good faith; (3) security for payment of workers' compensation
or other insurance or arising under worker's compensation laws or similar
legislation; (4) good faith deposits in connection with bids, tenders,
leases or contracts (other than contracts evidencing Indebtedness); (5)
zoning restrictions, easements, licenses, reservations, title defects,
rights of others for rights of way, utilities, sewers, electric lines,
telephone or telegraph lines, and other similar purposes, provisions,
covenants, conditions, waivers, restrictions on the use of property or
minor irregularities of title (and with respect to leasehold interests,
mortgages, obligations, liens and other encumbrances incurred, created,
assumed or permitted to exist and arising by, through or under a landlord
or owner of the leased property, with or without consent of the lessee),
none of which materially impairs the use of any parcel of property
material to the operation of the business of the Company or any Subsidiary
or the value of such property for the purpose of such business; (6)
deposits to secure public or statutory obligations, or in lieu of surety
or appeal bonds; or (7) operation of law in favor of landlords, carriers,
warehousemen, bankers, mechanics, materialmen, laborers, employees or
suppliers, incurred in the ordinary course of business for sums which are
not yet delinquent or are being contested in good faith by negotiations or
by appropriate proceedings which suspend the collection thereof;
13
(c) any Lien to secure the performance of bids, trade contracts,
leases (including, without limitation, statutory and common law landlord's
liens), statutory obligations, surety and appeal bonds, letters of credit
and other obligations of a like nature and incurred in the ordinary course
of business of the Company or any Subsidiary;
(d) any Lien securing obligations in connection with Indebtedness
permitted under clause (i) of paragraph (b) of Section 1008 which are
incurred or assumed in connection with the acquisition, development or
construction of real or personal, moveable or immovable property within
180 days of such incurrence or assumption; provided that such Liens only
extend to such acquired, developed or constructed property and any
accessories, accessions, additions, replacements and proceeds thereof;
(e) any Lien arising from judgments, decrees or attachments in
circumstances not constituting an Event of Default;
(f) any Lien securing obligations in connection with Indebtedness
permitted in clauses (ii) or (iii) of paragraph (b) of Section 1008;
(g) any Lien in favor of the Company or any Subsidiary;
(h) any Lien securing obligations in connection with Acquired
Indebtedness; provided that any such Lien does not extend to or cover any
property or assets of the Company or any of its Subsidiaries other than
the property or assets of the Acquired Person covered thereby or the
property or assets so acquired;
(i) any Lien in favor of the Trustee for the benefit of the Holders
or the Trustee arising under the provisions in this Indenture or the
Escrow Agreement;
(j) any Lien encumbering deposits made to secure obligations arising
from statutory, regulatory, contractual or warranty requirements of the
Company or any Subsidiary if and to the extent arising in the ordinary
course of business, including rights of offset and set-off;
(k) any Lien in favor of customs or revenue authorities to secure
payment of customs duties in connection with the importation of goods in
the ordinary course of business;
(l) leases or subleases granted to third Persons not interfering
with the ordinary course of business of the Company or its Subsidiaries;
and
(m) any Lien securing any extension, renewal, refinancing or
replacement, in whole or in part, of any obligation or Indebtedness
described in the foregoing clauses (a) through (d) and (f) through (h) so
long as no additional collateral is granted as security thereby.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the
14
purposes of this definition, any Security authenticated and delivered under
Section 308 in exchange for a mutilated Security or in lieu of a lost, destroyed
or stolen Security shall be deemed to evidence the same debt as the mutilated,
lost, destroyed or stolen Security.
"Preferred Stock" means, with respect to any Person, any Capital
Stock of any class or classes (however designated) which is preferred as to the
payment of dividends or distributions, or as to the distribution of assets upon
any voluntary or involuntary liquidation or dissolution of such Person, over the
Capital Stock of any other class of such Person.
"Prospectus" means the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, including any such
prospectus supplement with respect to the terms of the offering of any portion
of the Series A Securities covered by a Shelf Registration Statement, and by all
other amendments and supplements to a prospectus, including post-effective
amendments, and in each case including all material incorporated by reference
therein.
"Public Equity Offering" means an underwritten offering of Common
Stock of the Company with gross proceeds to the Company of at least $25 million
pursuant to a registration statement that has been declared effective by the
Commission pursuant to the Securities Act (other than a registration statement
on Form S-8 or otherwise relating to equity securities issuable under any
employee benefit plan of the Company).
"Purchase Money Obligation" means any Indebtedness secured by a Lien
on assets related to the business of the Company and any additions and
accessions thereto, which are purchased by the Company at any time after the
Securities are issued; provided that (i) the security agreement or conditional
sales or other title retention contract pursuant to which the Lien on such
assets is created (collectively a "Purchase Money Security Agreement") shall be
entered into within 90 days after the purchase or substantial completion of the
construction of such assets and shall at all times be confined solely to the
assets so purchased or acquired, any additions and accessions thereto and any
proceeds therefrom, (ii) at no time shall the aggregate principal amount of the
outstanding Indebtedness secured thereby be increased, except in connection with
the purchase of additions and accessions thereto and except in respect of fees
and other obligations in respect of such Indebtedness and (iii) (A) the
aggregate outstanding principal amount of Indebtedness secured thereby
(determined on a per asset basis in the case of any additions and accessions)
shall not at the time such Purchase Money Security Agreement is entered into
exceed 100% of the purchase price to the Company of the assets subject thereto
or (B) the Indebtedness secured thereby shall be with recourse solely to the
assets so purchased or acquired, any additions and accessions thereto and any
proceeds therefrom.
"QIB" means a "Qualified Institutional Buyer" as defined in Rule
144A under the Securities Act.
"Qualified Capital Stock" of any Person means any and all Capital
Stock of such Person other than Redeemable Capital Stock.
"Redeemable Capital Stock" means any Capital Stock that, either by
its terms or by the terms of any security into which it is convertible or
exchangeable or otherwise, is, or upon the happening of an event or passage of
time would be, required to be redeemed prior to the Stated Maturity of the
principal of the Securities or is redeemable at the option of the holder thereof
at any time prior to any such Stated Maturity, or is convertible into or
exchangeable for debt securities at any time prior to any such
15
Stated Maturity at the option of the holder thereof.
"Redemption Date" when used with respect to any Security to be
redeemed pursuant to any provision in this Indenture means the date fixed for
such redemption by or pursuant to this Indenture.
"Redemption Price" when used with respect to any Security to be
redeemed pursuant to any provision in this Indenture means the price at which it
is to be redeemed pursuant to this Indenture.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the date hereof, between the Company and the Initial
Purchaser.
"Registration Statement" means any registration statement of the
Company which covers any of the Series A Securities or Series B Securities
pursuant to the provisions of the Registration Rights Agreement, and all
amendments and supplements to any such Registration Statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.
"Regular Record Date" for the interest payable on any Interest
Payment Date means the April 15 or October 15 (whether or not a Business Day)
next preceding such Interest Payment Date.
"Regulation S" means Regulation S under the Securities Act, as
amended from time to time.
"Regulation S Global Securities" means one or more permanent global
Securities in registered form representing the aggregate principal amount of
Securities sold in reliance on Regulation S under the Securities Act.
"Responsible Officer" when used with respect to the Trustee means
any officer or employee assigned to administer this Indenture or any agent of
the Trustee appointed hereunder, including any vice president, assistant vice
president, secretary, assistant secretary, or any other officer or assistant
officer of the Trustee or any agent of the Trustee appointed hereunder to whom
any corporate trust matter is referred because of his or her knowledge of and
familiarity with the particular subject.
"Rule 144A" means Rule 144A under the Securities Act, as amended
from time to time.
"Rule 144A Global Securities" means one or more permanent global
Securities in registered form representing the aggregate principal amount of
Securities sold in reliance on Rule 144A under the Securities Act.
"Sale and Leaseback Transaction" means with respect to any Person,
any direct or indirect arrangement pursuant to which any property (other than
Capital Stock) is sold by such Person or a subsidiary, or, in the case of the
Company, it or a subsidiary, and is thereafter leased back from the purchaser or
transferee thereof by such Person or one of its subsidiaries or, in the case of
the Company, it or one of its Subsidiaries.
"S&P" means Standard & Poor's Rating Group, a division of McGraw
Hill, Inc., or any successor rating agency.
16
"Securities Act" means the Securities Act of 1933, as amended, or
any successor statute, and the rules and regulations promulgated thereunder.
"Series B Global Securities" means one or more permanent Global
Securities in registered form representing the aggregate principal amount of
Series B Securities exchanged for Series A Securities pursuant to the Exchange
Offer.
"Shelf Registration Statement" means a "shelf" registration
statement of the Company pursuant to Section 4 of the Registration Rights
Agreement, which covers all of the Registrable Securities (as defined in the
Registration Rights Agreement) on an appropriate form under Rule 415 under the
Securities Act, or any similar rule that may be adopted by the Commission, and
all amendments and supplements to such registration statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.
"Special Record Date" for the payment of any Defaulted Interest
means a date fixed by the Trustee pursuant to Section 309.
"Stated Maturity" means, when used with respect to any Indebtedness
or any installment of interest thereon, the dates specified in such Indebtedness
as the fixed date on which the principal of such Indebtedness or such
installment of interest, as the case may be, is due and payable.
"Strategic Investor" means any Person which is (or a controlled
Affiliate of any Person which is or a controlled Affiliate of which is) engaged
principally in the Internet Service Business and which has a Total Market
Capitalization of at least $1.0 billion.
"Subordinated Indebtedness" means Indebtedness of the Company or a
Guarantor subordinated in right of payment to the Securities or the Guarantee of
such Guarantor, as the case may be.
"subsidiary" means, with respect to any Person, any corporation,
association or other business entity (i) of which outstanding Capital Stock
having at least the majority of the votes entitled to be cast in the election of
directors is owned, directly or indirectly, by such Person and/or any one or
more subsidiaries of such Person, or (ii) of which at least a majority of voting
interest is owned, directly or indirectly, by such Person and/or one or more
subsidiaries of such Person.
"Subsidiary" means any subsidiary of the Company other than an
Unrestricted Subsidiary.
"Successor Security" of any particular Security means every Security
issued after, and evidencing all or a portion of the same debt as that evidenced
by, such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 308 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"Total Consolidated Indebtedness" means, as at any date of
determination, an amount equal to the aggregate amount of all Indebtedness of
the Company and any Subsidiary, on a consolidated basis, outstanding as of such
date of determination, after giving effect to any Incurrence of Indebtedness and
the application of the proceeds therefrom giving rise to such determination.
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"Total Market Capitalization" of any Person means, as of any day of
determination, the sum of (a) the consolidated Indebtedness of such Person and
any subsidiaries on such day, plus (b) the product of (i) the aggregate number
of outstanding shares of common stock of such Person on such day (which shall
not include any options or warrants on, or securities convertible or
exchangeable into, shares of common stock of such Person) and (ii) the average
closing price of such common stock over the 10 consecutive Trading Days ending
not earlier than 10 Trading Days immediately prior to such date of
determination, plus (c) the liquidation value of any outstanding shares of
Preferred Stock of such Person on such day. If no such closing price exists with
respect to shares of any such class, the value of such shares for purposes of
clause (b) of the preceding sentence shall be determined by the Board of
Directors in good faith and evidenced by a Board Resolution filed with the
Trustee. Notwithstanding the foregoing, unless the Person's common stock is
listed on any national securities exchange or on the Nasdaq National Market, the
"Total Market Capitalization" of the Person shall mean, as of any day of
determination, the enterprise value (without duplication) of the Person and any
subsidiaries (including the fair market value of their debt and equity), as
determined by an independent banking firm of national standing with experience
in such valuations and evidenced by a written opinion in customary form filed
with the Trustee; provided that for purposes of any such determination, the
enterprise value of the Person shall be calculated as if the Person were a
publicly held corporation without a controlling stockholder. For purposes of any
such determination, such banking firm's written opinion may state that such fair
market value is no less than a specified amount and such opinion may be as of a
date no earlier than 90 days prior to the date of such determination.
"Trading Day" with respect to a securities exchange or automated
quotation system means a day on which such exchange or system is open for a full
day of trading.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture, until a successor trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor trustee.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended, or any successor statute, and the rules and regulations promulgated
thereunder.
"Unrestricted Subsidiary" means (i) any subsidiary of the Company
that at the time of determination shall be an Unrestricted Subsidiary (as
designated by the Board of Directors of the Company, as provided below) and (ii)
any subsidiary of an Unrestricted Subsidiary. The Board of Directors of the
Company may designate any subsidiary of the Company (including any newly
acquired or newly formed subsidiary) to be an Unrestricted Subsidiary if all of
the following conditions apply: (a) neither the Company nor any of its
Subsidiaries provides credit support for Indebtedness of such subsidiary
(including any undertaking, agreement or instrument evidencing such
Indebtedness); (b) such subsidiary is not liable, directly or indirectly, with
respect to any Indebtedness other than Unrestricted Subsidiary Indebtedness; (c)
any Investment in such subsidiary made as a result of designating such
subsidiary an Unrestricted Subsidiary shall not violate the provisions of
Section 1018 and such subsidiary is not party to any agreement, contract,
arrangement or understanding at such time with the Company or any Subsidiary
unless the terms of any such agreement, contract, arrangement or understanding
are no less favorable to the Company or such Subsidiary than those that might be
obtained at the time from Persons who are not Affiliates of the Company; and (d)
such subsidiary does not own any Capital Stock in any Subsidiary of the Company
which is not simultaneously being designated an Unrestricted Subsidiary. Any
such designation by the Board of Directors of the Company shall be evidenced to
the Trustee by filing with the Trustee a Board Resolution giving effect to such
designation and an Officers' Certificate certifying that such designation
complies with the foregoing conditions and shall be deemed a Restricted Payment
on the date
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of designation in an amount equal to the greater of (1) the net book value of
such Investment or (2) the fair market value of such Investment as determined in
good faith by the Company's Board of Directors. The Board of Directors of the
Company may designate any Unrestricted Subsidiary as a Subsidiary; provided that
(i) immediately after giving effect to such designation, the Company could incur
$1.00 of additional Indebtedness pursuant to Section 1008(a) and (ii) all
Indebtedness of such Subsidiary shall be deemed to be incurred on the date such
Subsidiary becomes a Subsidiary.
"Unrestricted Subsidiary Indebtedness" of any Unrestricted
Subsidiary means Indebtedness of such Unrestricted Subsidiary (i) as to which
neither the Company nor any Subsidiary is directly or indirectly liable (by
virtue of the Company or any such Subsidiary being the primary obligor on,
guarantor of, or otherwise liable in any respect to, such Indebtedness), except
Guaranteed Debt of the Company or any Subsidiary to any Affiliate, in which case
(unless the incurrence of such Guaranteed Debt resulted in a Restricted Payment
at the time of incurrence) the Company shall be deemed to have made a Restricted
Payment equal to the principal amount of any such Indebtedness to the extent
guaranteed at the time such Affiliate is designated an Unrestricted Subsidiary
and (ii) which, upon the occurrence of a default with respect thereto, does not
result in, or permit any holder of any Indebtedness of the Company or any
Subsidiary to declare, a default on such Indebtedness of the Company or any
Subsidiary or cause the payment thereof to be accelerated or payable prior to
its Stated Maturity.
"U.S. Government Securities" means securities that are direct
obligations of the United States of America, the payment of which its full faith
and credit is pledged.
"Voting Stock" means Capital Stock of the class or classes pursuant
to which the holders thereof have the general voting power under ordinary
circumstances to elect at least a majority of the board of directors, managers
or trustees of a corporation (irrespective of whether or not at the time Capital
Stock of any other class or classes shall have or might have voting power by
reason of the happening of any contingency).
"Wholly Owned Subsidiary" means a Subsidiary all the Capital Stock
of which is owned by the Company or another Wholly Owned Subsidiary. For the
purposes of this definition, any directors' qualifying shares or investments by
foreign nationals mandated by applicable law shall be disregarded in determining
the ownership of a Subsidiary.
Section 102. Other Definitions.
Term Defined in Section
"Act"......................................................105
"Agent Members"............................................306
"Basket"..................................................1009
"Change of Control Offer".................................1014
"Change of Control Purchase Date".........................1014
"Change of Control Purchase Notice".......................1014
"Change of Control Purchase Price"........................1014
"covenant defeasance"......................................403
"Defaulted Interest".......................................309
"defeasance"...............................................402
"Defeasance Redemption Date"...............................404
"Defeased Securities"......................................401
"Distribution Compliance Period"...........................201
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"Excess Proceeds".........................................1012
"Offer"...................................................1012
"Offer Date"..............................................1012
"Offered Price"...........................................1012
"Pari Passu Debt Amount"..................................1012
"Pari Passu Offer"........................................1012
"Permitted Payment".......................................1009
"Physical Securities"......................................306
"Private Placement Legend".................................202
"Purchase Money Security Agreement"........................101
"Refinancing".............................................1009
"Required Filing Date"....................................1019
"Restricted Payments".....................................1009
"Securities"..........................................Recitals
"Security Amount".........................................1012
"Security Register"........................................305
"Security Registrar".......................................305
"Separation Date".....................................Recitals
"Series A Securities".................................Recitals
"Series B Securities".................................Recitals
"Special Payment Date".....................................309
"Surviving Entity".........................................801
"Surviving Guarantor Entity"...............................801
"Units"...............................................Recitals
"U.S. Government Obligations"..............................404
"Warrants"............................................Recitals
Section 103. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to
take any action under any provision of this Indenture, the Company and any
Guarantor (if applicable) and any other obligor on the Securities (if
applicable) shall furnish to the Trustee an Officers' Certificate in a form and
substance reasonably acceptable to the Trustee stating that all conditions
precedent, if any, provided for in this Indenture (including any covenant
compliance with which constitutes a condition precedent) relating to the
proposed action have been complied with, and an Opinion of Counsel in form and
substance reasonably acceptable to the Trustee stating that in the opinion of
such counsel all such conditions precedent, if any, have been complied with,
except that, in the case of any such application or request as to which the
furnishing of such certificates or opinions is specifically required by any
provision of this Indenture relating to such particular application or request,
no additional certificate or opinion need be furnished.
Every certificate or Opinion of Counsel with respect to compliance
with a condition or covenant provided for in this Indenture shall include:
(a) a statement that each individual signing such certificate or
individual or firm signing such opinion has read and understands such
covenant or condition and the definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
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(c) a statement that, in the opinion of each such individual or such
firm, he or it has made such examination or investigation as is necessary
to enable him or it to express an informed opinion as to whether or not
such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
individual or such firm, such condition or covenant has been complied
with.
Section 104. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by,
or covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate of an officer of the Company, any Guarantor or other
obligor on the Securities may be based, insofar as it relates to legal matters,
upon a certificate or opinion of, or representations by, counsel, unless such
officer knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to the matters upon which
his certificate or opinion is based are erroneous. Any such certificate or
opinion may be based, insofar as it relates to factual matters, upon a
certificate or opinion of, or representations by, an officer or officers of the
Company, any Guarantor or other obligor on the Securities stating that the
information with respect to such factual matters is in the possession of the
Company, any Guarantor or other obligor on the Securities, unless such officer
or counsel knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such matters are
erroneous. Opinions of Counsel required to be delivered to the Trustee may have
qualifications customary for opinions of the type required and counsel
delivering such Opinions of Counsel may rely on certificates of the Company or
government or other officials customary for opinions of the type required,
including certificates certifying as to matters of fact, including that various
financial covenants have been complied with.
Any certificate or opinion of an officer of the Company, any
Guarantor or other obligor on the Securities may be based, insofar as it relates
to accounting matters, upon a certificate or opinion of, or representations by,
an accountant or firm of accountants in the employ of the Company, unless such
officer knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to the accounting matters
upon which his certificate or opinion may be based are erroneous. Any
certificate or opinion of any independent firm of public accountants filed with
the Trustee shall contain a statement that such firm is independent with respect
to the Company.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
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Section 105. Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an
agent duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee and, where it is hereby expressly
required, to the Company. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Holders signing such instrument or instruments. Proof
of execution of any such instrument or of a writing appointing any such
agent shall be sufficient for any purpose of this Indenture and conclusive
in favor of the Trustee and the Company, if made in the manner provided in
this Section 105.
(b) The ownership of Securities shall be proved by the Security
Register.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other Act by the Holder of any Security shall bind every future
Holder of the same Security or the Holder of every Security issued upon
the transfer thereof or in exchange therefor or in lieu thereof, in
respect of anything done, suffered or omitted to be done by the Trustee,
any Paying Agent or the Company, any Guarantor or any other obligor of the
Securities in reliance thereon, whether or not notation of such action is
made upon such Security.
(d) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer
authorized by law to take acknowledgments of deeds, certifying that the
individual signing such instrument or writing acknowledged to him the
execution thereof. Where such execution is by a signer acting in a
capacity other than his individual capacity, such certificate or affidavit
shall also constitute sufficient proof of his authority. The fact and date
of the execution of any such instrument or writing, or the authority of
the Person executing the same, may also be proved in any other manner
which the Trustee deems sufficient.
(e) If the Company shall solicit from the Holders any request,
demand, authorization, direction, notice, consent, waiver or other Act,
the Company may, at its option, by or pursuant to a Board Resolution, fix
in advance a record date for the determination of such Holders entitled to
give such request, demand, authorization, direction, notice, consent,
waiver or other Act, but the Company shall have no obligation to do so.
Notwithstanding Trust Indenture Act Section 316(c), any such record date
shall be the record date specified in or pursuant to such Board
Resolution, which shall be a date not more than 30 days prior to the first
solicitation of Holders generally in connection therewith and no later
than the date such first solicitation is completed.
If such a record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other Act may be given before or
after such record date, but only the Holders of record at the close of
business on such record date shall be deemed to be Holders for purposes of
determining whether Holders of the requisite proportion of Securities then
Outstanding have authorized or agreed or consented to such request,
demand, authorization, direction, notice, consent, waiver or other Act,
and for this purpose the Securities then Outstanding shall be computed as
of such record date; provided that no such request, demand, authorization,
direction,
22
notice, consent, waiver or other Act by the Holders on such record date
shall be deemed effective unless it shall become effective pursuant to the
provisions of this Indenture not later than six months after such record
date.
(f) For purposes of this Indenture, any action by the Holders which
may be taken in writing may be taken by electronic means or as otherwise
reasonably acceptable to the Trustee.
Section 106. Notices, etc., to the Trustee, the Company and any
Guarantor.
Any request, demand, authorization, direction, notice, consent,
waiver or Act of Holders or other document provided or permitted by this
Indenture to be made upon, given or furnished to, or filed with:
(a) the Trustee by any Holder or by the Company or any Guarantor or
any other obligor on the Securities shall be sufficient for every purpose
(except as provided in Section 501(c)) hereunder if in writing and mailed,
first-class postage prepaid, or delivered by recognized overnight courier,
to or with the Trustee at its Corporate Trust Office, Attention: Corporate
Trust Administration, or at any other address previously furnished in
writing to the Holders or the Company, any Guarantor or any other obligor
on the Securities by the Trustee; or
(b) the Company or any Guarantor by the Trustee or any Holder shall
be sufficient for every purpose (except as provided in Section 501(c))
hereunder if in writing and mailed, first-class postage prepaid, or
delivered by recognized overnight courier, to the Company or such
Guarantor addressed to 295 Lafayette Street, 3rd Floor, New York, New York
10012, Attention: President or at any other address previously furnished
in writing to the Trustee by the Company or such Guarantor.
Section 107. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event,
such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, or delivered by
recognized overnight courier, to each Holder affected by such event, at its
address as it appears in the Security Register, not later than the latest date,
and not earlier than the earliest date, prescribed for the giving of such
notice. In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Any notice when mailed to a Holder in the aforesaid manner shall
be conclusively deemed to have been received by such Holder whether or not
actually received by such Holder. Where this Indenture provides for notice in
any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Trustee, but such filing shall not be a condition precedent to the validity
of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause, it shall be impracticable to mail notice of any event
as required by any provision of this Indenture, then any other method of giving
such notice as shall be reasonably satisfactory to the Trustee shall be deemed
to be a sufficient giving of such notice.
23
Section 108. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with any
provision of the Trust Indenture Act or another provision which is required or
deemed to be included in this Indenture by any of the provisions of the Trust
Indenture Act, the provision or requirement of the Trust Indenture Act shall
control. If any provision of this Indenture modifies or excludes any provision
of the Trust Indenture Act that may be so modified or excluded, the latter
provision shall be deemed to apply to this Indenture as so modified or to be
excluded, as the case may be.
Section 109. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents
are for convenience only and shall not affect the construction hereof.
Section 110. Successors and Assigns.
All covenants and agreements in this Indenture by the Company and
the Guarantors shall bind their respective successors and assigns, whether so
expressed or not.
Section 111. Separability Clause.
In case any provision in this Indenture or in the Securities shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
Section 112. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person (other than the parties hereto and their successors
hereunder, any Paying Agent and the Holders) any benefit or any legal or
equitable right, remedy or claim under this Indenture.
Section 113. Governing Law.
THIS INDENTURE, THE SECURITIES AND ANY GUARANTEE SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF.
Section 114. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date,
Maturity or Stated Maturity of any Security shall not be a Business Day, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of interest or principal or premium, if any, need not be made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on such Interest Payment Date or Redemption Date, or at
the Maturity or Stated Maturity and no interest shall accrue with respect to
such payment for the period from and after such Interest Payment Date,
Redemption Date, Maturity or Stated Maturity, as the case may be, to the next
succeeding Business Day.
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Section 115. Independence of Covenants.
All covenants and agreements in this Indenture shall be given
independent effect so that if a particular action or condition is not permitted
by any such covenants, the fact that it would be permitted by an exception to,
or be otherwise within the limitations of, another covenant shall not avoid the
occurrence of a Default or an Event of Default if such action is taken or
condition exists.
Section 116. Schedules and Exhibits.
All schedules and exhibits attached hereto are by this reference
made a part hereof with the same force and effect as if herein set forth in
full.
Section 117. Counterparts.
This Indenture may be executed in any number of counterparts, each
of which shall be deemed an original; but all such counterparts shall together
constitute but one and the same instrument.
ARTICLE TWO
SECURITY FORMS
Section 201. Forms Generally.
The Securities and the Trustee's certificate of authentication
thereon shall be in substantially the forms set forth in this Article Two, with
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted hereby and may have such letters, numbers or other
marks of identification and such legends or endorsements placed thereon as may
be required to comply with the rules of any securities exchange, any
organizational document or governing instrument or applicable law or as may,
consistently herewith, be determined by the officers executing such Securities,
as evidenced by their execution of the Securities. Any portion of the text of
any Security may be set forth on the reverse thereof, with an appropriate
reference thereto on the face of the Security.
The definitive Securities shall be printed, lithographed or engraved
or produced by any combination of these methods or may be produced in any other
manner permitted by the rules of any securities exchange on which the Securities
may be listed, all as determined by the officers executing such Securities, as
evidenced by their execution of such Securities.
Series A Securities offered and sold in reliance on Rule 144A shall
be issued initially in the form of one or more Rule 144A Global Securities,
substantially in the form set forth in Section 202(a), deposited upon issuance
with the Trustee, as custodian for the Depositary, registered in the name of the
Depositary, or its nominee, in each case for credit by the Depositary to an
account of a direct or indirect participant of the Depositary, duly executed by
the Company and authenticated by the Trustee as hereinafter provided. The
aggregate principal amount of the Rule 144A Global Securities may from time to
time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for the Depositary or its nominee, as hereinafter
provided.
Series A Securities offered and sold in reliance on Regulation S
shall be issued initially in the form of one or more Regulation S Global
Securities, substantially in the form set forth in Section
25
202(a), deposited upon issuance with the Trustee, as custodian for the
Depositary, registered in the name of the Depositary, or its nominee in each
case for credit by the Depositary to an account of a direct or indirect
participant of the Depositary, duly executed by the Company and authenticated by
the Trustee as hereinafter provided; provided, however, that upon such deposit
through and including the 40th day (or one year in the event that the Securities
are being sold as a part of a Unit) after the later of the commencement of the
Offering and the original issue date of the Securities (such period through and
including such 40th day (or one year in the event that the Securities are being
sold as a part of a Unit), the "Distribution Compliance Period"), all such
Securities shall be credited to or through accounts maintained at the Depositary
unless exchanged for interests in the Rule 144A Global Securities in accordance
with the transfer and certification requirements described below. The aggregate
principal amount of the Regulation S Global Securities may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for the Depositary or its nominee, as hereinafter provided.
Series B Securities exchanged for Series A Securities shall be
issued initially in the form of one or more Series B Global Securities,
substantially in the form set forth in Section 202(b), deposited upon issuance
with the Trustee, as custodian for the Depositary, registered in the name of the
Depositary or its nominee, in each case for credit by the Depositary to an
account of a direct or indirect participant of the Depositary, duly executed by
the Company and authenticated by the Trustee as hereinafter provided. The
aggregate principal amount of the Series B Global Securities may from time to
time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for the Depositary or its nominee, as hereinafter
provided.
Section 202. Form of Face of Securities.
(a) The form of the face of any Series A Securities authenticated
and delivered hereunder shall be substantially as follows:
Unless and until (i) a Series A Security is sold under an
effective Registration Statement or (ii) a Series A Security is
exchanged for a Series B Security in connection with an effective
Registration Statement, in each case pursuant to the Registration
Rights Agreement referred to below, then such Series A Security
shall bear the legend set forth below (the "Private Placement
Legend") on the face thereof:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN
THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A)
IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT ("RULE 144A")) OR (B) IT IS NOT
A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE
TRANSACTION MEETING THE REQUIREMENTS OF REGULATION S UNDER THE
SECURITIES ACT ("REGULATION S"), AND (2) AGREES TO OFFER,
RESELL OR OTHERWISE TRANSFER
26
SUCH SECURITY ONLY (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER
THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A INSIDE THE UNITED
STATES, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER
IS BEING MADE IN RELIANCE ON RULE 144A, (D) OUTSIDE THE UNITED
STATES PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS IN AN
OFFSHORE TRANSACTION WITHIN THE MEANING OF AND PURSUANT TO THE
PROVISIONS OF REGULATION S, (E) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, OR (F)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S
AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER (I) PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE
THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR
OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (II) IN
EACH OF THE FOREGOING CASES, IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
APPLICABLE JURISDICTION AND TO REQUIRE THAT A CERTIFICATE OF
TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS
SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE
TRUSTEE AND THE HOLDER HEREOF SHALL NOTIFY ANY PURCHASER FROM
IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS
SET FORTH ABOVE. AS USED HEREIN, THE TERMS "UNITED STATES,"
"OFFSHORE TRANSACTION," AND "U.S. PERSON" HAVE THE RESPECTIVE
MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES
ACT.
Prior to the Separation Date, each Series A Security shall
bear the legend set forth below on the face thereof:
THIS SECURITY IS INITIALLY ISSUED AS A PART OF AN ISSUANCE OF
UNITS, EACH OF WHICH CONSISTS OF ONE SERIES A SECURITY AND ONE
WARRANT INITIALLY ENTITLING THE HOLDER THEREOF TO PURCHASE
3.52 SHARES OF COMMON STOCK, $0.01 PAR VALUE, OF BELL
TECHNOLOGY GROUP LTD. (THE "WARRANTS"). PRIOR TO THE EARLIEST
TO OCCUR OF (i) 180 DAYS FROM THE DATE OF ISSUANCE OF THIS
SECURITY, (ii) A CHANGE IN CONTROL, (iii) THE OCCURRENCE OF AN
EVENT OF DEFAULT, (iv) THE DATE ON WHICH THE REGISTRATION
STATEMENT OR THE EXCHANGE OFFER REGISTRATION STATEMENT IS
DECLARED EFFECTIVE OR (v) SUCH EARLIER DATE AS MAY BE
DETERMINED BY THE INITIAL PURCHASER, THE SERIES A SECURITIES
EVIDENCED BY THIS
27
CERTIFICATE MAY NOT BE TRANSFERRED OR EXCHANGED SEPARATELY
FROM, BUT MAY BE TRANSFERRED OR EXCHANGED ONLY TOGETHER WITH,
THE WARRANTS.
[Legend if Security is a Global Security]
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A
SUCCESSOR DEPOSITARY. TRANSFERS OF THIS GLOBAL SECURITY SHALL
BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES
OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY
SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN SECTIONS 306 AND 307 OF THE
INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT AND ANY SUCH
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
BELL TECHNOLOGY GROUP LTD.
----------
13% SENIOR NOTE DUE 2005, SERIES A
CUSIP NO._________________
No. _____________ $_________________________
Bell Technology Group Ltd., a Delaware corporation (herein called the
"Company," which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to or
registered assigns, the principal sum of United States dollars on May 1, 2005,
at the office or agency of the Company referred to below, and to pay interest
thereon from the date of issuance, or from the most recent Interest Payment Date
to which interest has been paid or duly provided for, semiannually on May 1 and
November 1 in each year, commencing November 1, 1998 at the rate of 13% per
annum, subject to adjustments as described in the second following paragraph, in
28
United States dollars, until the principal hereof is paid or duly provided for.
Interest shall be computed on the basis of a 360-day year comprised of twelve
30-day months.
The Holder of this Series A Security is entitled to the benefits of the
Registration Rights Agreement between the Company and the Initial Purchaser,
dated April 30, 1998 (the "Registration Rights Agreement"), pursuant to which,
subject to the terms and conditions thereof, the Company is obligated to
consummate the Exchange Offer pursuant to which the Holder of this Security
shall have the right to exchange this Security for 13% Senior Notes due 2005,
Series B (herein called the "Series B Securities") in like principal amount as
provided therein. The Series A Securities and the Series B Securities are
together referred to as the "Securities." The Series A Securities shall rank
pari passu in right of payment with the Series B Securities.
In the event that (a) the Exchange Offer Registration Statement is not
filed with the Commission on or prior to the date specified in the Registration
Rights Agreement, (b) the Exchange Offer Registration Statement has not been
declared effective on or prior to the date specified in the Registration Rights
Agreement, (c) the Exchange Offer is not consummated or a Shelf Registration
Statement is not declared effective, in either case, on or prior to the date
specified in the Registration Rights Agreement, or (d) the Shelf Registration
Statement or the Exchange Offer Registration Statement is declared effective but
thereafter ceases to be effective or usable in connection with resales of the
Series A Securities during the periods specified in the Registration Rights
Agreement, without being succeeded immediately by a post-effective amendment to
such Registration Statement that cures such failure and that is itself declared
effective within a five Business Day period after filing such post-effective
amendment (each such event referred to in clauses (a) through (d) above, a
"Registration Default"), then commencing on the day following the date on which
such Registration Default occurs, the interest rate borne by the Series A
Securities shall be increased by one-half of one percent per annum for the 90-
day period following such Registration Default, which rate will increase by
one-half of one percent per annum with respect to each subsequent 90-day period
up to a maximum of one and one half percent (1.50%) per annum until cured
("Additional Interest"). Following the cure of all Registration Defaults, the
accrual of Additional Interest will cease and the interest rate will revert to
the original rate.
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in the Indenture hereinafter referred
to, be paid to the Person in whose name this Security (or any Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, which shall be the April 15 or October 15 (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date.
Any such interest not so punctually paid, or duly provided for, and interest on
such defaulted interest at the interest rate borne by the Series A Securities,
to the extent lawful, shall forthwith cease to be payable to the Holder on such
Regular Record Date, and may either be paid to the Person in whose name this
Security (or any Predecessor Securities) is registered at the close of business
on a Special Record Date for the payment of such defaulted interest to be fixed
by the Trustee, notice whereof shall be given to Holders of Securities not less
than 10 days prior to such Special Record Date, or be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and upon such notice as may be
required by the Indenture not inconsistent with the requirements of such
exchange, all as more fully provided in the Indenture.
Payment of the principal of, premium, if any, and interest on, this
Security, and exchange
29
or registration of transfer of this Security, will be made at the office or
agency of the Company in The City of New York maintained for that purpose (which
initially will be a corporate trust office of the Trustee located at 140
Broadway, New York, New York 10005), or at such other office or agency as may be
maintained for such purpose, by wire transfer of immediately available funds
unless otherwise provided in the Indenture. Such payment shall be in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly executed by
the Trustee referred to on the reverse hereof or by the authenticating agent
appointed as provided in the Indenture by manual signature of an authorized
signer, this Security shall not be entitled to any benefit under the Indenture,
or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed by the manual or facsimile signature of its authorized officers and its
corporate seal to be affixed or reproduced hereon.
Dated:
------------------------
BELL TECHNOLOGY GROUP LTD.
[Seal] By:
-----------------------------------
Title:
Attest:
- --------------------------------
Authorized Officer
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 13% Senior Notes due 2005, Series A referred to in the
within-mentioned Indenture.
MARINE MIDLAND BANK, as Trustee
By:
-----------------------------------
Authorized Signatory
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the Company pursuant to
Section 1012 or Section 1014, as applicable, of the Indenture, check the Box: _
30
If you wish to have a portion of this Security purchased by the Company
pursuant to Section 1012 or Section 1014 as applicable, of the Indenture, state
the amount (in original principal amount):
$
------------------------
Date: Your Signature:
------------- --------------------------
(Sign exactly as your name
appears on the other side of this
Security)
Signature Guarantee:
------------------
[Signature must be guaranteed by an eligible Guarantor Institution (banks, stock
brokers, savings and loan associations and credit unions) with membership in an
approved guarantee medallion program pursuant to Securities and Exchange
Commission Rule 17Ad-15]
(b) The form of the face of any Series B Securities authenticated and
delivered hereunder shall be substantially as follows:
[Legend if Security is a Global Security]
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A SUCCESSOR DEPOSITARY.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTIONS 306 AND 307
OF THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT AND ANY SUCH CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST
31
HEREIN.
BELL TECHNOLOGY GROUP LTD.
----------
13% SENIOR NOTE DUE 2005, SERIES B
CUSIP NO._________________
No. _____________ $_________________________
Bell Technology Group Ltd., a Delaware corporation (herein called the
"Company," which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to or
registered assigns, the principal sum of United States dollars on May 1, 2005,
at the office or agency of the Company referred to below, and to pay interest
thereon from the date of issuance, or from the most recent Interest Payment Date
to which interest has been paid or duly provided for, semiannually on May 1 and
November 1 in each year, commencing November 1, 1998 at the rate of 13% per
annum, in United States dollars, until the principal hereof is paid or duly
provided for; provided that to the extent interest has not been paid or duly
provided for with respect to the Series A Security exchanged for this Series B
Security, interest on this Series B Security shall accrue from the most recent
Interest Payment Date to which interest on the Series A Security which was
exchanged for this Series B Security has been paid or duly provided for.
Interest shall be computed on the basis of a 360-day year comprised of twelve
30-day months.
This Series B Security was issued pursuant to the Exchange Offer pursuant
to which the 13% Senior Notes due 2005, Series A (herein called the "Series A
Securities") in like principal amount were exchanged for the Series B
Securities. The Series B Securities rank pari passu in right of payment with the
Series A Securities.
In addition, for any period in which the Series A Security exchanged for
this Series B Security was outstanding, in the event that (a) the Exchange Offer
Registration Statement is not filed with the Commission on or prior to the date
specified in the Registration Rights Agreement, (b) the Exchange Offer
Registration Statement has not been declared effective on or prior to the date
specified in the Registration Rights Agreement, (c) the Exchange Offer is not
consummated or a Shelf Registration Statement is not declared effective, in
either case, on or prior to the date specified in the Registration Rights
Agreement the date of original issue of the Series A Security, or (d) the Shelf
Registration Statement or the Exchange Offer Registration Statement is declared
effective but thereafter ceases to be effective or usable in connection with
resales of the Series A Securities during the periods specified above, without
being succeeded immediately by a post-effective amendment to such Registration
Statement that cures such failure and that is itself declared effective within a
five Business Day period after filing such post-effective amendment (each such
event referred to in clauses (a) through (d) above, a "Registration Default"),
then commencing on the day following the date on which such Registration Default
occurs, the interest rate borne by the Series A Securities shall be increased by
one-half of one percent per annum for the 90-day period following such
Registration Default, which rate will increase by one-half of one percent per
annum with respect to each subsequent 90-day period up to a maximum of one and
one half percent (1.50%) per annum until cured ("Additional Interest").
Following the cure of all Registration Defaults, the accrual of Additional
Interest will cease and the interest rate will revert
32
to the original rate; provided that, to the extent interest at such increased
interest rate has been paid or duly provided for with respect to the Series A
Security, interest at such increased interest rate, if any, on this Series B
Security shall accrue from the most recent Interest Payment Date to which such
interest on the Series A Security has been paid or duly provided for; provided,
however, that, if after any such reduction in interest rate, a different event
specified in clause (a), (b), (c) or (d) above occurs, the interest rate shall
again be increased pursuant to the foregoing provisions.
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in the Indenture hereinafter referred
to, be paid to the Person in whose name this Security (or any Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, which shall be the April 15 or October 15 (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date.
Any such interest not so punctually paid, or duly provided for, and interest on
such defaulted interest at the interest rate borne by the Series B Securities,
to the extent lawful, shall forthwith cease to be payable to the Holder on such
Regular Record Date, and may either be paid to the Person in whose name this
Security (or any Predecessor Securities) is registered at the close of business
on a Special Record Date for the payment of such defaulted interest to be fixed
by the Trustee, notice whereof shall be given to Holders of Securities not less
than 10 days prior to such Special Record Date, or be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in this Indenture.
Payment of the principal of, premium, if any, and interest on, this
Security, and exchange or registration of transfer of the Security, will be made
at the office or agency of the Company in The City of New York maintained for
such purpose (which initially will be a corporate trust office of the Trustee
located at 140 Broadway, New York, New York 10005), or at such other office or
agency as may be maintained for such purpose, or at such other office or agency
as may be maintained for such purpose, or, at the option of the Company, payment
of interest may be made by check mailed to the address of the Person entitled
thereto as such address shall appear on the Security Register, and provided,
that payment by wire transfer of immediately available funds will be required
with respect to principal of and interest on all Global Securities and all other
Securities the Holders of which shall have provided wire transfer instructions
to the Company or the Paying Agent. Such payment shall be in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly executed by
the Trustee referred to on the reverse hereof or by the authenticating agent
appointed as provided in the Indenture by manual signature of an authorized
signer, this Security shall not be entitled to any benefit under the Indenture,
or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed by the manual or facsimile signature of its authorized officers and its
corporate seal to be affixed or reproduced hereon.
33
Dated:
------------------
BELL TECHNOLOGY GROUP LTD.
[Seal] By:
-----------------------------------
Title:
Attest:
- ------------------------
Authorized Officer
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 13% Senior Notes due 2005, Series B referred to in the
within-mentioned Indenture.
MARINE MIDLAND BANK, as Trustee
By:
----------------------------------
Authorized Signatory
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the Company pursuant to
Section 1012 or Section 1014, as applicable, of the Indenture, check the Box:
If you wish to have a portion of this Security purchased by the Company
pursuant to Section 1012 or Section 1014 as applicable, of the Indenture, state
the amount (in original principal amount):
$____________________
Date: Your Signature:
------------------ --------------------
(Sign exactly as your name appears on the
other side of this Security)
Signature Guarantee:
-----------------
[Signature must be guaranteed by an eligible Guarantor Institution (banks, stock
brokers, savings and loan associations and credit unions) with membership in an
approved guarantee medallion program pursuant to Securities and Exchange
Commission Rule 17Ad-15]
34
Section 203. Form of Reverse of Securities.
(a) The form of the reverse of the Series A Securities shall be
substantially as follows:
Bell Technology Group Ltd.
13% Senior Note due 2005, Series A
This Security is one of a duly authorized issue of Securities of the
Company designated as its 13% Senior Notes due 2005, Series A (herein
called the "Securities"), limited (except as otherwise provided in the
Indenture referred to below) in aggregate principal amount to
$160,000,000, issued under and subject to the terms of an indenture (the
"Indenture") dated as of April 30, 1998, between the Company and Marine
Midland Bank, as trustee (the "Trustee," which term includes any successor
trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties, obligations and
immunities thereunder of the Company, the Guarantors, if any, the Trustee
and the Holders of the Securities, and of the terms upon which the
Securities are, and are to be, authenticated and delivered.
The Indenture contains provisions for defeasance at any time of (a)
the entire Indebtedness on the Securities and (b) certain restrictive
covenants and related Defaults and Events of Default, in each case upon
compliance with certain conditions set forth therein.
The Securities are subject to redemption at any time on or after May
1, 2001, at the option of the Company, in whole or in part, on not less
than 30 nor more than 60 days' prior notice, in amounts of $1,000 or an
integral multiple thereof, at the following redemption prices (expressed
as percentages of the principal amount), if redeemed during the 12-month
period beginning on May 1, of the years indicated below:
Redemption
Year Price
---- -----
2001.............................................. 106.500%
2002.............................................. 104.333%
2003.............................................. 102.166%
and thereafter at 100% of the principal amount, in each case, together
with accrued and unpaid interest, if any, to the Redemption Date (subject
to the rights of Holders of record on relevant record dates to receive
interest due on an Interest Payment Date).
In addition, at any time on or prior to May 1, 2000, the Company
may, at its option, use the net proceeds of one or more Public Equity
Offerings or the sale of Common Stock (other than Disqualified Stock) of
the Company to a Strategic Investor in a single transaction or in a series
of related transactions, to redeem up to an aggregate of 35% of the
aggregate principal amount of Securities originally issued under the
Indenture at a redemption price equal to 113% of the aggregate principal
amount thereof, plus accrued and unpaid interest thereon, if any, to the
Redemption Date; provided that at
35
least 65% aggregate principal amount of the initially issued aggregate
principal amount of Securities remains outstanding immediately after the
occurrence of such redemption. In order to effect the foregoing
redemption, the Company must mail a notice of redemption no later than 45
days after the closing of the related Public Equity Offering or sale of
Common Stock to a Strategic Investor and must consummate such redemption
within 60 days of the closing of the Public Equity Offering or sale of
Common Stock to a Strategic Investor.
If less than all of the Securities are to be redeemed, the Trustee
shall select the Securities or portions thereof to be redeemed pro rata,
by lot or by any other method the Trustee shall deem fair and reasonable.
Upon the occurrence of a Change of Control, each Holder may require
the Company to purchase such Holder's Securities in whole or in part in
integral multiples of $1,000, at a purchase price in cash in an amount
equal to 101% of the principal amount thereof, plus accrued and unpaid
interest, if any, to the date of purchase, pursuant to a Change of Control
Offer in accordance with the procedures set forth in the Indenture.
Under certain circumstances, in the event the Net Cash Proceeds
received by the Company from any Asset Sale, which proceeds are not used
to permanently repay Pari Passu Indebtedness of the Company or invested in
properties or other assets that replace the properties and assets that
were the subject of the Asset Sale and which will be used only in an
Internet Service Business, exceeds a specified amount the Company will be
required to apply such proceeds to the repayment of the Securities and
certain Indebtedness ranking pari passu in right of payment to the
Securities.
In the case of any redemption or repurchase of Securities in
accordance with the Indenture, interest installments whose Stated Maturity
is on or prior to the Redemption Date will be payable to the Holders of
such Securities of record as of the close of business on the relevant
Regular Record Date or Special Record Date referred to on the face hereof.
Securities (or portions thereof) for whose redemption and payment
provision is made in accordance with the Indenture shall cease to bear
interest from and after the Redemption Date.
In the event of redemption or repurchase of this Security in
accordance with the Indenture in part only, a new Security or Securities
for the unredeemed portion hereof shall be issued in the name of the
Holder hereof upon the cancellation hereof.
If an Event of Default shall occur and be continuing, the principal
amount of all the Securities may be declared due and payable in the manner
and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions (including certain
amendments permitted without the consent of any Holders and certain
amendments which require the consent of all the Holders) as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the Guarantors, if any, and the rights of
the Holders under the Indenture and the Securities and the Guarantees, if
any, at any time by the Company and the Trustee with the consent of the
Holders of at least a majority in aggregate principal amount of the
Securities at the time Outstanding.
36
The Indenture also contains provisions permitting the Holders of at least
a majority in aggregate principal amount of the Securities (100% of the
Holders in certain circumstances) at the time Outstanding, on behalf of
the Holders of all the Securities, to waive compliance by the Company and
the Guarantors, if any, with certain provisions of the Indenture and the
Securities and the Guarantees, if any, and certain past Defaults under the
Indenture and the Securities and the Guarantees, if any, and their
consequences. Any such consent or waiver by or on behalf of the Holder of
this Security shall be conclusive and binding upon such Holder and upon
all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof
whether or not notation of such consent or waiver is made upon this
Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, any Guarantor, if any, or any other obligor on the Securities (in
the event such Guarantor or such other obligor is obligated to make
payments in respect of the Securities), which is absolute and
unconditional, to pay the principal of, premium, if any, and interest on,
this Security at the times, place, and rate, and in the coin or currency,
herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the
Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in the Borough of
Manhattan, The City of New York, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or its attorney
duly authorized in writing, and thereupon one or more new Securities, of
authorized denominations and for the same aggregate principal amount, will
be issued to the designated transferee or transferees.
Certificated securities shall be transferred to all beneficial
holders in exchange for their beneficial interests in the Rule 144A Global
Securities or the Regulation S Global Securities if (x) the Company
notifies the Trustee in writing that the Depositary is unwilling or unable
to continue as depository for such Global Security and a successor
depository is not appointed by the Company within 90 days or (y) the
Company, at its option, notifies the Trustee in writing that it elects to
cause the issuance of certificated Series A Securities. Upon any such
issuance, the Trustee is required to register such certificated Series A
Securities in the name of, and cause the same to be delivered to, such
Person or Persons (or the nominee of any thereof). All such certificated
Series A Securities would be required to include the Private Placement
Legend.
Series A Securities in certificated form are issuable only in
registered form without coupons in denominations of $1,000 and any
integral multiple thereof. As provided in the Indenture and subject to
certain limitations therein set forth, the Series A Securities are
exchangeable for a like aggregate principal amount of Securities of a
differing authorized denomination, as requested by the Holder surrendering
the same.
At any time when the Company is not subject to Sections 13 or 15(d)
of the Exchange Act, upon the written request of a Holder of a Series A
Security, the Company will promptly furnish or cause to be furnished such
information as is specified pursuant to Rule 144A(d)(4) under the
Securities Act (or any successor provision thereto) to such
37
Holder or to a prospective purchaser of such Series A Security who such
Holder informs the Company is reasonably believed to be a "Qualified
Institutional Buyer" within the meaning of Rule 144A under the Securities
Act, as the case may be, in order to permit compliance by such Holder with
Rule 144A under the Securities Act.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in
connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, any Guarantor, the Trustee and any agent of the
Company, any Guarantor or the Trustee may treat the Person in whose name
this Security is registered as the owner hereof for all purposes, whether
or not this Security is overdue, and neither the Company, any Guarantor,
the Trustee nor any such agent shall be affected by notice to the
contrary.
THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES THEREOF.
All terms used in this Security which are defined in the Indenture
and not otherwise defined herein shall have the meanings assigned to them
in the Indenture.
[The Transferee Certificate, in the form of Appendix I hereto, will
be attached to the Series A Security.]
(b) The form of the reverse of the Series B Securities shall be
substantially as follows:
Bell Technology Group Ltd.
13% Senior Note due 2005, Series B
This Security is one of a duly authorized issue of Securities of the
Company designated as its 13% Senior Notes due 2005, Series B (herein
called the "Securities"), limited (except as otherwise provided in the
Indenture referred to below) in aggregate principal amount to
$160,000,000, issued under and subject to the terms of an indenture (the
"Indenture") dated as of April 30, 1998, between the Company and Marine
Midland Bank, as trustee (the "Trustee," which term includes any successor
trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties, obligations and
immunities thereunder of the Company, the Guarantors, if any, the Trustee
and the Holders of the Securities, and of the terms upon which the
Securities are, and are to be, authenticated and delivered.
The Indenture contains provisions for defeasance at any time of (a)
the entire Indebtedness on the Securities and (b) certain restrictive
covenants and related Defaults and Events of Default, in each case upon
compliance with certain conditions set forth therein.
38
The Securities are subject to redemption at any time on or after May
1, 2001, at the option of the Company, in whole or in part, on not less
than 30 nor more than 60 days' prior notice, in amounts of $1,000 or an
integral multiple thereof, at the following redemption prices (expressed
as percentages of the principal amount), if redeemed during the 12-month
period beginning on May 1, of the years indicated below:
Redemption
Year Price
---- -----
2001............................................... 106.500%
2002............................................... 104.333%
2003............................................... 102.166%
and thereafter at 100% of the principal amount, in each case, together
with accrued and unpaid interest, if any, to the Redemption Date (subject
to the rights of Holders of record on relevant record dates to receive
interest due on an Interest Payment Date).
In addition, at any time on or prior to May 1, 2000, the Company
may, at its option, use the net proceeds of one or more Public Equity
Offerings or the sale of Common Stock (other than Disqualified Stock) of
the Company to a Strategic Investor in a single transaction or in a series
of related transactions, to redeem up to an aggregate of 35% of the
aggregate principal amount of Securities originally issued under the
Indenture at a redemption price equal to 113% of the aggregate principal
amount thereof, plus accrued and unpaid interest thereon, if any, to the
Redemption Date; provided that at least 65% aggregate principal amount of
the initially issued aggregate principal amount of Securities remains
outstanding immediately after the occurrence of such redemption. In order
to effect the foregoing redemption, the Company must mail a notice of
redemption no later than 45 days after the closing of the related Public
Equity Offering or sale of Common Stock to a Strategic Investor and must
consummate such redemption within 60 days of the closing of the Public
Equity Offering or sale of Common Stock to a Strategic Investor.
If less than all of the Securities are to be redeemed, the Trustee
shall select the Securities or portions thereof to be redeemed pro rata,
by lot or by any other method the Trustee shall deem fair and reasonable.
Upon the occurrence of a Change of Control, each Holder may require
the Company to purchase such Holder's Securities in whole or in part in
integral multiples of $1,000, at a purchase price in cash in an amount
equal to 101% of the principal amount thereof, plus accrued and unpaid
interest, if any, to the date of purchase, pursuant to Change of Control
Offer and in accordance with the procedures set forth in the Indenture.
Under certain circumstances, in the event the Net Cash Proceeds
received by the Company from any Asset Sale, which proceeds are not used
to permanently repay Pari Passu Indebtedness of the Company or invested in
properties or other assets that replace the properties and assets that
were the subject of the Asset Sale and which will be used only in an
Internet Service Business, exceeds a specified amount, the Company will be
required to apply such proceeds to the repayment of the Securities and
certain Indebtedness ranking pari passu in right of payment to the
Securities.
39
In the case of any redemption or repurchase of Securities in
accordance with the Indenture, interest installments whose Stated Maturity
is on or prior to the Redemption Date will be payable to the Holders of
such Securities of record as of the close of business on the relevant
Regular Record Date or Special Record Date referred to on the face hereof.
Securities (or portions thereof) for whose redemption and payment
provision is made in accordance with the Indenture shall cease to bear
interest from and after the Redemption Date.
In the event of redemption or repurchase of this Security in
accordance with the Indenture in part only, a new Security or Securities
for the unredeemed portion hereof shall be issued in the name of the
Holder hereof upon the cancellation hereof.
If an Event of Default shall occur and be continuing, the principal
amount of all the Securities may be declared due and payable in the manner
and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions (including certain
amendments permitted without the consent of any Holders and certain
amendments which required the consent of all of the Holders) as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the Guarantors, if any, and the rights of
the Holders under the Indenture and the Securities and the Guarantees, if
any, at any time by the Company and the Trustee with the consent of the
Holders of at least a majority in aggregate principal amount of the
Securities at the time Outstanding. The Indenture also contains provisions
permitting the Holders of at least a majority in aggregate principal
amount of the Securities (100% of the Holders in certain circumstances) at
the time Outstanding, on behalf of the Holders of all the Securities, to
waive compliance by the Company and the Guarantors, if any, with certain
provisions of the Indenture and the Securities and the Guarantees, if any,
and certain past Defaults under the Indenture and the Securities and the
Guarantees, if any, and their consequences. Any such consent or waiver by
or on behalf of the Holder of this Security shall be conclusive and
binding upon such Holder and upon all future Holders of this Security and
of any Security issued upon the registration of transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent
or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, any Guarantor or any other obligor on the Securities (in the
event such Guarantor or such other obligor is obligated to make payments
in respect of the Securities), which is absolute and unconditional, to pay
the principal of, premium, if any, and interest on, this Security at the
times, place, and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the
Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in the Borough of
Manhattan, The City of New York, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or its attorney
duly authorized in writing, and thereupon one or more new Securities, of
authorized denominations and for the same
40
aggregate principal amount, will be issued to the designated transferee or
transferees.
Certificated securities shall be transferred to all beneficial
holders in exchange for their beneficial interests in the Rule 144A Global
Securities or the Regulation S Global Securities if (x) the Company
notifies the Trustee in writing that the Depositary is unwilling or unable
to continue as depository for such Global Security and a successor
depository is not appointed by the Company within 90 days or (y) the
Company, at its option, notifies the Trustee in writing that it elects to
cause the issuance of certificated Series B Securities. Upon any such
issuance, the Trustee is required to register such certificated Series B
Securities in the name of, and cause the same to be delivered to, such
Person or Persons (or the nominee of any thereof).
Series B Securities in certificated form are issuable only in
registered form without coupons in denominations of $1,000 and any
integral multiple thereof. As provided in the Indenture and subject to
certain limitations therein set forth, the Series B Securities are
exchangeable for a like aggregate principal amount of Securities of a
differing authorized denomination, as requested by the Holder surrendering
the same.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in
connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, any Guarantor, the Trustee and any agent of the
Company, any Guarantor or the Trustee may treat the Person in whose name
this Security is registered as the owner hereof for all purposes, whether
or not this Security is overdue, and neither the Company, any Guarantor,
the Trustee nor any such agent shall be affected by notice to the
contrary.
THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES THEREOF.
All terms used in this Security which are defined in the Indenture
and not otherwise defined herein shall have the meanings assigned to them
in the Indenture.
[The Transferee Certificate, in the form of Appendix II hereto, will
be attached to the Series B Security.]
ARTICLE THREE
THE SECURITIES
Section 301. Title and Terms.
The aggregate principal amount of Securities which may be authenticated
and delivered under this Indenture is limited to $160,000,000 in principal
amount of Securities, except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other Securities
pursuant to Section 303, 304, 305, 306, 307, 308, 906, 1012, 1014 or 1108.
41
The Securities shall be known and designated as the "13% Senior Notes due
2005" of the Company. The Stated Maturity of the Securities shall be May 1,
2005, and the Securities shall each bear interest at the rate of 13% per annum,
as such interest rate may be adjusted as set forth in the Securities, from the
date of issuance, or from the most recent Interest Payment Date to which
interest has been paid, payable semiannually on May 1 and November 1, in each
year, commencing November 1, 1998, until the principal thereof is paid or duly
provided for. Interest on any overdue principal, interest (to the extent lawful)
or premium, if any, shall be payable on demand.
Payment of the principal of, premium, if any, and interest on, the
Securities and exchange or registration of transfer of the Securities will be
made at the office or agency of the Company in The City of New York maintained
for such purposes (which initially will be a corporate trust office of the
Trustee located at 140 Broadway, New York, New York 10005), or at such other
office or agency as may be maintained for such purpose, or, at the option of the
Company, payment of interest may be made by check mailed to the address of the
Person entitled thereto as such address shall appear on the Security Register,
and provided, that payment by wire transfer of immediately available funds will
be required with respect to principal of and interest on all Global Securities
and all other Securities the Holders of which shall have provided wire transfer
instructions to the Trustee or the Paying Agent prior to the related record
date. Such payment shall be in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts.
For all purposes hereunder, the Series A Securities and the Series B
Securities will be treated as one class and are together referred to as the
"Securities." The Series A Securities rank pari passu in right of payment with
the Series B Securities.
The Securities shall be subject to repurchase by the Company pursuant to
an Offer as provided in Section 1012.
Holders shall have the right to require the Company to purchase their
Securities, in whole or in part, in the event of a Change of Control pursuant to
Section 1014.
The Securities shall be redeemable as provided in Article Eleven and in
the Securities.
At the election of the Company, the entire Indebtedness on the Securities
or certain of the Company's obligations and covenants and certain Events of
Default thereunder may be defeased as provided in Article Four.
Section 302. Denominations.
The Securities shall be issuable only in fully registered form without
coupons and only in denominations of $1,000 and any integral multiple thereof.
Section 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by one of its
President, its Chief Executive Officer, its Chief Financial Officer or one of
its Vice Presidents under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signatures of any of these
officers on the Securities may be manual or facsimile.
42
Securities bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities executed by the Company to the
Trustee (with or without Guarantees endorsed thereon) for authentication,
together with a Company Order for the authentication and delivery of such
Securities; and the Trustee in accordance with such Company Order shall
authenticate and make available for delivery such Securities as provided in this
Indenture and not otherwise.
Each Security shall be dated the date of its authentication.
No Security or Guarantee endorsed thereon shall be entitled to any benefit
under this Indenture or be valid or obligatory for any purpose unless there
appears on such Security a certificate of authentication substantially in the
form provided for herein duly executed by the Trustee by manual signature of an
authorized officer, and such certificate upon any Security shall be conclusive
evidence, and the only evidence, that such Security has been duly authenticated
and delivered hereunder and is entitled to the benefits of this Indenture.
In case the Company or any Guarantor, pursuant to Article Eight, shall, in
a single transaction or through a series of related transactions, be
consolidated or merged with or into any other Person or shall sell, assign,
convey, transfer, lease or otherwise dispose of all or substantially all of its
properties and assets to any Person, and the successor Person resulting from
such consolidation or surviving such merger, or into which the Company or such
Guarantor shall have been merged, or the successor Person which shall have
participated in the sale, assignment, conveyance, transfer, lease or other
disposition as aforesaid, shall have executed an indenture supplemental hereto
with the Trustee pursuant to Article Eight, any of the Securities authenticated
or delivered prior to such consolidation, merger, sale, assignment, conveyance,
transfer, lease or other disposition may, from time to time, at the request of
the successor Person, be exchanged for other Securities executed in the name of
the successor Person with such changes in phraseology and form as may be
appropriate, but otherwise in substance of like tenor as the Securities
surrendered for such exchange and of like principal amount; and the Trustee,
upon Company Request of the successor Person, shall authenticate and deliver
Securities as specified in such request for the purpose of such exchange. If
Securities shall at any time be authenticated and delivered in any new name of a
successor Person pursuant to this Section 303 in exchange or substitution for or
upon registration of transfer of any Securities, such successor Person, at the
option of the Holders but without expense to them, shall provide for the
exchange of all Securities at the time Outstanding for Securities authenticated
and delivered in such new name.
The Trustee may appoint an authenticating agent acceptable to the Company
to authenticate Securities on behalf of the Trustee. Unless limited by the terms
of such appointment, an authenticating agent may authenticate Securities
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as any Security Registrar or Paying
Agent to deal with the Company and its Affiliates.
If an officer whose signature is on a Security no longer holds that office
at the time the Trustee authenticates such Security such Security shall be valid
nevertheless.
43
Section 304. Temporary Securities.
Pending the preparation of definitive Securities, the Company may execute,
and upon Company Order the Trustee shall authenticate and make available for
delivery, temporary Securities which are printed, lithographed, typewritten or
otherwise produced, in any authorized denomination, substantially of the tenor
of the definitive Securities in lieu of which they are issued and with such
appropriate insertions, omissions, substitutions and other variations as the
officers executing such Securities may determine, as conclusively evidenced by
their execution of such Securities.
If temporary Securities are issued, the Company will cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at the office
or agency of the Company designated for such purpose pursuant to Section 1002,
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities, the Company shall execute and the Trustee (in accordance
with a Company Order for the authentication of such Securities) shall
authenticate and make available for delivery in exchange therefor a like
principal amount of definitive Securities of authorized denominations. Until so
exchanged the temporary Securities shall in all respects be entitled to the same
benefits under this Indenture as definitive Securities.
Section 305. Registration, Registration of Transfer and Exchange.
The Company shall cause the Trustee to keep, so long as it is the Security
Registrar, at the Corporate Trust Office of the Trustee, or such other office as
the Trustee may designate, a register (the register maintained in such office or
in any other office or agency designated pursuant to Section 1002 being herein
sometimes referred to as the "Security Register") in which, subject to such
reasonable regulations as the Security Registrar may prescribe, the Company
shall provide for the registration of Securities and of transfers of Securities.
The Trustee shall initially be the "Security Registrar" for the purpose of
registering Securities and transfers of Securities as herein provided. The
Company may change the Security Registrar or appoint one or more co-Security
Registrars without notice.
Upon surrender for registration of transfer of any Security at the office
or agency of the Company designated pursuant to Section 1002, the Company shall
execute, and the Trustee shall (in accordance with a Company Order for the
authentication of such Securities) authenticate and make available for delivery,
in the name of the designated transferee or transferees, one or more new
Securities of the same series of any authorized denomination or denominations,
of a like aggregate principal amount.
Furthermore, any Holder of a Global Security shall, by acceptance of such
Global Security, agree that transfers of beneficial interests in such Global
Security may be effected only through a book-entry system maintained by the
Holder of such Global Security (or its agent), and that ownership of a
beneficial interest in a Security shall be required to be reflected in a book
entry.
At the option of the Holder, Securities may be exchanged for other
Securities of any authorized denomination or denominations, of a like aggregate
principal amount, upon surrender of the Securities to be exchanged at such
office or agency. Whenever any Securities are so surrendered for exchange, the
Company shall execute, and the Trustee shall (in accordance with a Company Order
for the authentication of such Securities) authenticate and make available for
delivery, Securities of the same series which the Holder making the exchange is
entitled to receive; provided that no exchange of Series A Securities for Series
B Securities shall occur until a Registration Statement shall have been declared
effective by the Commission pursuant to the terms of the Registration Rights
Agreement and otherwise in
44
accordance with the provisions thereof.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
Indebtedness, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer, or
for exchange, repurchase or redemption, shall (if so required by the Company or
the Trustee) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar, duly
executed by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made to a Holder for any registration of
transfer, exchange or redemption of Securities, except for any tax or other
governmental charge that may be imposed in connection therewith, other than
exchanges pursuant to Sections 303, 304, 305, 308, 906, 1012, 1015 or 1108 not
involving any transfer.
Neither the Company nor the Trustee shall be required (a) to issue,
register the transfer of or exchange any Security during a period beginning at
the opening of business 15 days before the mailing of a notice of redemption of
the Securities selected for redemption under Section 1104 and ending at the
close of business on the day of such mailing or (b) to register the transfer of
or exchange any Security so selected for redemption in whole or in part, except
the unredeemed portion of Securities being redeemed in part.
Every Security shall be subject to the restrictions on transfer provided
in the legend required to be set forth on the face of each Security pursuant to
Section 202, and the restrictions set forth in this Article Three, and the
Holder of each Security, by such Holder's acceptance thereof (or interest
therein), agrees to be bound by such restrictions on transfer.
Except as provided in the preceding paragraph, any Security authenticated
and delivered upon registration of transfer of, or in exchange for, or in lieu
of, any Global Security, whether pursuant to this Section 305, Section 304, 308,
906 or 1108 or otherwise, shall also be a Global Security and bear the legend
specified in Section 202.
Section 306. Book Entry Provisions for Global Securities.
(a) Each Global Security initially shall (i) be registered in the
name of the nominee of the Depositary, (ii) be deposited with, or on
behalf of, the Depositary and (iii) bear legends as set forth in Section
202. Members of, or participants in, the Depositary ("Participants") shall
have no rights under this Indenture with respect to any Global Security
held on their behalf by the Depositary, or the Trustee as its custodian,
or under such Global Security, and the Depositary may be treated by the
Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner of such Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company,
the Trustee or any agent of the Company or the Trustee from giving effect
to any written certification, proxy or other authorization furnished by
the Depositary or shall impair, as between the Depositary and its
Participants, the operation of customary practices governing the exercise
of the rights of a beneficial holder of any Security.
(b) Notwithstanding any other provision in this Indenture, no Global
Security may
45
be exchanged in whole or in part for Securities registered, and no
transfer of a Global Security in whole or in part may be registered, in
the name of any Person other than the Depositary for such Global Security
or a nominee thereof unless (i) the Company notifies the Trustee in
writing that the Depositary is unwilling or unable to continue as
Depositary for such Global Security or has ceased to be a clearing agency
registered as such under the Exchange Act, and in either case the Company
fails to appoint a successor Depositary within 90 days thereof or (ii) the
Company, at its option, executes and delivers to the Trustee a Company
Order stating that it elects to cause the issuance of the Securities in
certificated form and that all Global Securities shall be exchanged in
whole for Securities that are not Global Securities (in which case such
exchange shall be effected by the Trustee).
(c) If any Global Security is to be exchanged for other Securities
or canceled in whole, it shall be surrendered by or on behalf of the
Depositary or its nominee to the Trustee, as Security Registrar, for
exchange or cancellation as provided in this Article Three. If any Global
Security is to be exchanged for other Securities or canceled in part, or
if another Security is to be exchanged in whole or in part for a
beneficial interest in any Global Security, then either (i) such Global
Security shall be so surrendered for exchange or cancellation as provided
in this Article Three or (ii) the principal amount thereof shall be
reduced or increased by an amount equal to the portion thereof to be so
exchanged or canceled, or equal to the principal amount of such other
Security to be so exchanged for a beneficial interest therein, as the case
may be, by means of an appropriate adjustment made on the records of the
Trustee, as Security Registrar, whereupon the Trustee, in accordance with
the Applicable Procedures, shall instruct the Depositary or its authorized
representative to make a corresponding adjustment to its records. Upon any
such surrender or adjustment of a Global Security, the Trustee shall,
subject to this Section 306(c) and as otherwise provided in this Article
Three, authenticate and deliver any Securities issuable in exchange for
such Global Security (or any portion thereof) to or upon the order of, and
registered in such names as may be directed by, the Depositary or its
authorized representative. Upon the request of the Trustee in connection
with the occurrence of any of the events specified in the preceding
paragraph, the Company shall promptly make available to the Trustee a
reasonable supply of Securities that are not in the form of Global
Securities. The Trustee shall be entitled to rely upon any order,
direction or request of the Depositary or its authorized representative
which is given or made pursuant to this Article Three if such order,
direction or request is given or made in accordance with the Applicable
Procedures.
(d) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any
portion thereof, whether pursuant to this Article Three or otherwise,
shall be authenticated and delivered in the form of, and shall be, a
Global Security, unless such Security is registered in the name of a
Person other than the Depositary for such Global Security or a nominee
thereof.
(e) The Depositary or its nominee, as registered owner of a Global
Security, shall be the Holder of such Global Security for all purposes
under this Indenture and the Securities, and owners of beneficial
interests in a Global Security shall hold such interests pursuant to the
Applicable Procedures. Accordingly, any such owner's beneficial interest
in a Global Security will be shown only on, and the transfer of such
interest shall be effected only through, records maintained by the
Depositary or its nominee or its Participants.
46
Section 307. Special Transfer and Exchange Provisions.
(a) Certain Transfers and Exchanges. Transfers and exchanges of Securities
and beneficial interests in a Global Security of the kinds specified in this
Section 307 shall be made only in accordance with this Section 307.
(i) Rule 144A Global Security to Regulation S Global Security.
If the owner of a beneficial interest in the Rule 144A
Global Security wishes at any time to transfer such interest to a
Person who wishes to acquire the same in the form of a beneficial
interest in the Regulation S Global Security, such transfer may be
effected only in accordance with the provisions of this paragraph
and paragraph (b)(iv) below and subject to the Applicable
Procedures. Upon receipt by the Trustee, as Security Registrar, of
(a) an order given by the Depositary or its authorized
representative directing that a beneficial interest in the
Regulation S Global Security in a specified principal amount be
credited to a specified Participant's account and that a beneficial
interest in the Rule 144A Global Security in an equal principal
amount be debited from another specified Participant's account and
(b) a Regulation S Certificate in the form of Exhibit A hereto,
satisfactory to the Trustee and duly executed by the owner of such
beneficial interest in the Rule 144A Global Security or his attorney
duly authorized in writing, then the Trustee, as Security Registrar
but subject to paragraph (b)(iv) below, shall reduce the principal
amount of the Rule 144A Global Security and increase the principal
amount of the Regulation S Global Security by such specified
principal amount as provided in Section 306(c).
(ii) Regulation S Global Security to Rule 144A Global
Security.
If the owner of a beneficial interest in the Regulation
S Global Security wishes at any time to transfer such interest to a
Person who wishes to acquire the same in the form of a beneficial
interest in the Rule 144A Global Security, such transfer may be
effected only in accordance with this paragraph (ii) and subject to
the Applicable Procedures. Upon receipt by the Trustee, as Security
Registrar, of (a) an order given by the Depositary or its authorized
representative directing that a beneficial interest in the Rule 144A
Global Security in a specified principal amount be credited to a
specified Participant's account and that a beneficial interest in
the Regulation S Global Security in an equal principal amount be
debited from another specified Participant's account and (b) if such
transfer is to occur during the applicable Distribution Compliance
Period, a Restricted Securities Certificate in the form of Exhibit B
hereto, satisfactory to the Trustee and duly executed by the owner
of such beneficial interest in the Regulation S Global Security or
his attorney duly authorized in writing, then the Trustee, as
Security Registrar, shall reduce the principal amount of the
Regulation S Global Security and increase the principal amount of
the Rule 144A Global Security by such specified principal amount as
provided in Section 306(c).
47
(iii) Exchanges between Global Security and Non-Global
Security.
A beneficial interest in a Global Security may be
exchanged for a Security that is not a Global Security as provided
in Section 307(b), provided that, if such interest is a beneficial
interest in the Rule 144A Global Security, or if such interest is a
beneficial interest in the Regulation S Global Security and such
exchange is to occur during the applicable Distribution Compliance
Period, then such interest shall bear the Private Placement Legend
(subject in each case to Section 307(b)).
(b) Private Placement Legends.
Rule 144A Securities and their Successor Securities and Regulation S
Securities and their Successor Securities shall bear a Private Placement
Legend, subject to the following:
(i) subject to the following clauses of this Section 307(b),
a Security or any portion thereof which is exchanged, upon transfer
or otherwise, for a Global Security or any portion thereof shall
bear the Private Placement Legend borne by such Global Security
while represented thereby;
(ii) subject to the following clauses of this Section 307(b),
a new Security which is not a Global Security and is issued in
exchange for another Security (including a Global Security) or any
portion thereof, upon transfer or otherwise, shall bear the Private
Placement Legend borne by such other Security;
(iii) Series B Securities, and all other Securities sold or
otherwise disposed of pursuant to an effective registration
statement under the Securities Act, together with their respective
Successor Securities, shall not bear a Private Placement Legend;
(iv) at any time after a Security may be freely transferred
without registration under the Securities Act or without being
subject to transfer restrictions pursuant to the Securities Act, a
new Security which does not bear a Private Placement Legend may be
issued in exchange for or in lieu of a Security (other than a Global
Security) or any portion thereof which bears such a legend if the
Trustee has received an Unrestricted Securities Certificate
substantially in the form of Exhibit C hereto, satisfactory to the
Trustee and duly executed by the Holder of such legended Security or
his attorney duly authorized in writing, and after such date and
receipt of such certificate, the Trustee shall authenticate and
deliver such a new Security in exchange for or in lieu of such other
Security as provided in this Article Three;
(v) a new Security which does not bear a Private Placement
Legend may be issued in exchange for or in lieu of a Security (other
than a Global Security) or any portion thereof which bears such a
legend if, in the Company's judgment, placing such a legend upon
such new Security is not necessary to ensure compliance with the
registration requirements of the Securities Act, and the Trustee, at
the direction of the Company, shall authenticate and deliver such a
new Security as provided in this Article Three; and
(vi) notwithstanding the foregoing provisions of this Section
307(b), a
48
Successor Security of a Security that does not bear a particular
form of Private Placement Legend shall not bear such form of legend
unless the Company has reasonable cause to believe that such
Successor Security is a "restricted security" within the meaning of
Rule 144, in which case the Trustee, at the direction of the
Company, shall authenticate and deliver a new Security bearing a
Private Placement Legend in exchange for such Successor Security as
provided in this Article Three.
By its acceptance of any Security bearing the Private Placement
Legend, each Holder of such a Security acknowledges the restrictions on
transfer of such Security set forth in this Indenture and in the Private
Placement Legend and agrees that it will transfer such Security only as
provided in this Indenture.
The Security Registrar shall retain copies of all letters, notices
and other written communications received pursuant to Section 306 or this
Section 307. The Company 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
Security Registrar.
In the event that any amendment to Regulation S becomes effective
during the term of this Indenture which alters the holding period
applicable to the Regulation S Global Securities, all reference in this
Indenture to a holding period for Non-U.S. Persons will be deemed to
include such amendment.
Section 308. Mutilated, Destroyed, Lost and Stolen Securities.
If (a) any mutilated Security is surrendered to the Trustee, or (b)
the Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, and there is delivered to the
Company, any Guarantor or the Trustee, such security or indemnity, in each case,
as may be required by them to save each of them harmless, then, in the absence
of notice to the Company, any Guarantor or the Trustee that such Security has
been acquired by a bona fide purchaser, the Company shall execute and upon a
Company Request the Trustee shall authenticate and make available for delivery,
in exchange for any such mutilated Security or in lieu of any such destroyed,
lost or stolen Security, a replacement Security of like tenor and principal
amount, bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a replacement Security, pay such Security.
Upon the issuance of any replacement Securities under this Section,
the Company may require the payment of a sum sufficient to pay all documentary,
stamp or similar issue or transfer taxes or other governmental charges that may
be imposed in relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith.
Every replacement Security issued pursuant to this Section in lieu
of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company and any Guarantor, whether or
not the destroyed, lost or stolen Security shall be at any time enforceable by
anyone, and shall be entitled to all benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder.
49
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
Section 309. Payment of Interest; Interest Rights Preserved.
Interest on any Security which is payable, and is punctually paid or
duly provided for, on the Stated Maturity of such interest shall be paid to the
Person in whose name the Security (or any Predecessor Securities) is registered
at the close of business on the Regular Record Date for such interest payment.
Any interest on any Security which is payable, but is not punctually
paid or duly provided for, on the Stated Maturity of such interest, and interest
on such defaulted interest at the then applicable interest rate borne by the
Securities, to the extent lawful (such defaulted interest and interest thereon
herein collectively called "Defaulted Interest"), shall forthwith cease to be
payable to the Holder on the Regular Record Date; and such Defaulted Interest
may be paid by the Company, at its election in each case, as provided in
Subsection (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Securities (or any relevant Predecessor
Securities) are registered at the close of business on a Special Record
Date for the payment of such Defaulted Interest, which shall be fixed in
the following manner. The Company shall notify the Trustee in writing of
the amount of Defaulted Interest proposed to be paid on each Security and
the date (not less than 30 days after such notice) of the proposed payment
(the "Special Payment Date"), and at the same time the Company shall
deposit with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the
Special Payment Date, such amount when deposited to be held in trust for
the benefit of the Persons entitled to such Defaulted Interest as provided
in this paragraph (a). Thereupon the Trustee shall fix a Special Record
Date for the payment of such Defaulted Interest which shall be not more
than 15 days and not less than 10 days prior to the date of the Special
Payment Date and not less than 10 days after the receipt by the Trustee of
the notice of the proposed payment. The Trustee shall promptly notify the
Company in writing of such Special Record Date. In the name and at the
expense of the Company, the Trustee shall cause notice of the proposed
payment of such Defaulted Interest and the Special Record Date therefor to
be mailed, first-class postage prepaid, to each Holder at its address as
it appears in the Security Register, not less than 10 days prior to such
Special Record Date. Notice of the proposed payment of such Defaulted
Interest and the Special Record Date and Special Payment Date therefor
having been so mailed, such Defaulted Interest shall be paid to the
Persons in whose names the Securities are registered on such Special
Record Date and shall no longer be payable pursuant to the following
paragraph (b).
(b) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities may be listed, and upon such
notice as may be required by this Indenture not inconsistent with the
requirements of such exchange, if, after written notice given by the
Company to the Trustee of the proposed payment pursuant to this
Subsection, such payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section 309, each
Security delivered under
50
this Indenture upon registration of transfer of or in exchange for or in lieu of
any other Security shall carry the rights to interest accrued and unpaid, and to
accrue, which were carried by such other Security.
Section 310. CUSIP, ISIN and CINS Numbers.
The Company in issuing the Securities may use "CUSIP", "ISIN" and
"CINS" numbers (if then generally in use), and the Company, or the Trustee on
behalf of the Company, shall use CUSIP, ISIN or CINS numbers in notices of
redemption or exchange as a convenience to Holders; provided, however, that any
such notice shall state that no representation is made as to the correctness of
such numbers either as printed on the Securities or as contained in any notice
of redemption or exchange and that reliance may be placed only on the other
identification numbers printed on the Securities; and provided further, however,
that failure to use CUSIP, ISIN or CINS numbers in any notice of redemption or
exchange shall not affect the validity or sufficiency of such notice.
Section 311. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer,
the Company, any Guarantor, the Trustee and any agent of the Company, any
Guarantor or the Trustee may treat the Person in whose name any Security is
registered as the owner of such Security for the purpose of receiving payment of
principal of, premium, if any, and (subject to Section 309) interest on, such
Security and for all other purposes whatsoever, whether or not such Security is
overdue, and neither the Company, any Guarantor, the Trustee nor any agent of
the Company, any Guarantor or the Trustee shall be affected by notice to the
contrary.
Section 312. Cancellation.
All Securities surrendered for payment, purchase, redemption,
registration of transfer or exchange shall be delivered to the Trustee and, if
not already canceled, shall be promptly canceled by it. The Company and any
Guarantor may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the Company or such
Guarantor may have acquired in any manner whatsoever, and all Securities so
delivered shall be promptly canceled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities canceled as provided
in this Section 312, except as expressly permitted by this Indenture. All
canceled Securities held by the Trustee shall be returned to the Company. The
Trustee shall provide the Company a list of all Securities that have been
canceled from time to time as requested by the Company.
Section 313. Computation of Interest.
Interest on the Securities shall be computed on the basis of a
360-day year comprised of twelve 30-day months.
ARTICLE FOUR
DEFEASANCE AND COVENANT DEFEASANCE
Section 401. Company's Option to Effect Defeasance or Covenant
Defeasance.
The Company may, at its option by Board Resolution, at any time,
with respect to the
51
Securities, elect to have either Section 402 or Section 403 be applied to all of
the Outstanding Securities (the "Defeased Securities"), upon compliance with the
conditions set forth below in this Article Four.
Section 402. Defeasance and Discharge.
Upon the Company's exercise under Section 401 of the option
applicable to this Section 402, the Company, each Guarantor and any other
obligor upon the Securities, if any, shall be deemed to have been discharged
from its obligations with respect to the Defeased Securities on the date the
conditions set forth in Section 404 below are satisfied (hereinafter,
"defeasance"). For this purpose, such defeasance means that the Company, each
Guarantor and any other obligor upon the Securities shall be deemed to have paid
and discharged the entire Indebtedness represented by the Defeased Securities,
which shall thereafter be deemed to be "Outstanding" only for the purposes of
Section 405 and the other Sections of this Indenture referred to in (a) and (b)
below, and to have satisfied all its other obligations under such Securities and
this Indenture insofar as such Securities are concerned (and the Trustee, at the
expense of the Company and upon Company Request, shall execute proper
instruments acknowledging the same), except for the following which shall
survive until otherwise terminated or discharged hereunder: (a) the rights of
Holders of Defeased Securities to receive payments in respect of the principal
of, premium, if any, and interest on, such Securities, when such payments are
due, (b) the Company's obligations with respect to such Defeased Securities
under Sections 304, 305, 308, 1002 and 1003, (c) the rights, powers, trusts,
duties and immunities of the Trustee hereunder, including, without limitation,
the Trustee's rights under Section 607, and (d) this Article Four. Subject to
compliance with this Article Four, the Company may exercise its option under
this Section 402 notwithstanding the prior exercise of its option under Section
403 with respect to the Securities.
Section 403. Covenant Defeasance.
Upon the Company's exercise under Section 401 of the option
applicable to this Section 403, the Company and each Guarantor shall be released
from its obligations under any covenant or provision contained or referred to in
Sections 1005 through 1022, inclusive, and the provisions of clauses (iii) and
(v) of Section 801(a) with respect to the Defeased Securities on and after the
date the conditions set forth in Section 404 below are satisfied (hereinafter,
"covenant defeasance"), and the Defeased Securities shall thereafter be deemed
to be not "Outstanding" for the purposes of any direction, waiver, consent or
declaration or Act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "Outstanding"
for all other purposes hereunder. For this purpose, such covenant defeasance
means that, with respect to the Defeased Securities, the Company and each
Guarantor may omit to comply with and shall have no liability in respect of any
term, condition or limitation set forth in any such Section, whether directly or
indirectly, by reason of any reference elsewhere herein to any such Section or
by reason of any reference in any such Section to any other provision herein or
in any other document and such omission to comply shall not constitute a Default
or an Event of Default under Section 501(c) but, except as specified above, the
remainder of this Indenture and such Defeased Securities shall be unaffected
thereby.
Section 404. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of either
Section 402 or Section 403 to the Defeased Securities:
(a) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee as trust funds in trust for the purpose of
making the following payments, specifically
52
pledged as security for, and dedicated solely to, the benefit of the
Holders of such Securities, (1) cash in United States dollars, (2) U.S.
Government Obligations, or (3) a combination thereof, in such amounts as
will be sufficient, in the opinion of a nationally recognized firm of
independent public accountants or a nationally recognized investment
banking firm selected by the Company expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, and which shall be
applied by the Trustee to pay and discharge, the principal of, premium, if
any, and interest on, the Defeased Securities, on the Stated Maturity of
such principal or interest (or on any date after May 1, 2003 (such date
being referred to as the "Defeasance Redemption Date"), if at or prior to
electing to exercise either its option applicable to Section 402 or its
option applicable to Section 403, the Company has delivered to the Trustee
an irrevocable notice to redeem the Defeased Securities on the Defeasance
Redemption Date). For this purpose, "U.S. Government Obligations" means
securities that are (I) direct obligations of the United States of America
for the timely payment of which its full faith and credit is pledged or
(II) obligations of a Person controlled or supervised by and acting as an
agency or instrumentality of the United States of America the timely
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 the specific payment of principal of or interest on the U.S.
Government Obligation evidenced by such depository receipt;
(b) In the case of an election under Section 402, the Company shall
have delivered to the Trustee an Opinion of Independent Counsel in the
United States stating that (1) the Company has received from, or there has
been published by, the Internal Revenue Service a ruling or (2) since the
date hereof, there has been a change in the applicable federal income tax
law, in either case to the effect that, and based thereon such Opinion of
Independent Counsel in the United States acceptable to the Trustee shall
confirm that, the Holders of the Outstanding Securities will not recognize
income, gain or loss for federal income tax purposes as a result of such
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 defeasance had not occurred;
(c) In the case of an election under Section 403, the Company shall
have delivered to the Trustee an Opinion of Independent Counsel in the
United States acceptable to the Trustee to the effect that the Holders of
the Outstanding Securities will not recognize income, gain or loss for
federal income tax purposes as a result of such covenant defeasance and
will be subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such covenant
defeasance had not occurred;
(d) No Default or Event of Default shall have occurred and be
continuing on the date of such deposit or insofar as Section 501(h) or (i)
is concerned, at any time during the period ending on the 91st day after
the date of deposit (it being understood that this condition shall not be
deemed satisfied until the expiration of such period);
(e) Such defeasance shall not cause the Trustee for the Securities
to have a conflicting interest for purposes of the Trust Indenture Act
with respect to any other securities of
53
the Company or any Guarantor;
(f) Such defeasance shall not result in a breach or violation of, or
constitute a Default under, this Indenture or any other material agreement
or instrument to which the Company, any Guarantor or any Subsidiary is a
party or by which it is bound;
(g) Such defeasance shall not result in the trust arising from such
deposit constituting an investment company within the meaning of the
Investment Company Act of 1940, as amended, unless such trust shall be
registered under such Act or exempt from registration thereunder;
(h) The Company shall have delivered to the Trustee an Opinion of
Independent Counsel in the United States acceptable to the Trustee to the
effect that after the 91st day following the deposit, the trust funds will
not be subject to the effect of any applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally;
(i) The Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the
intent of preferring the Holders of the Securities or any Guarantee over
the other creditors of the Company or any Guarantor with the intent of
defeating, hindering, delaying or defrauding creditors of the Company, any
Guarantor or others;
(j) No event or condition shall exist that would prevent the Company
from making payments of the principal of, premium, if any, and interest on
the Securities on the date of such deposit or at any time ending on the
91st day after the date of such deposit; and
(k) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Independent Counsel acceptable to the
Trustee, each stating that all conditions precedent provided for relating
to either the defeasance under Section 402 or under Section 403 (as the
case may be) have been
complied with.
Opinions of Counsel or Opinions of Independent Counsel required to
be delivered under this Section shall be in form and substance reasonably
satisfactory to the Trustee and may have qualifications customary for opinions
of the type required, and counsel delivering such opinions may rely on
certificates of the Company or government or other officials customary for
opinions of the type required, which certificates shall be limited as to matters
of fact, including that various financial covenants have been complied with.
Section 405. Deposited Money and U.S. Government Obligations to be
Held in Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1003, all
United States dollars and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee pursuant to Section 404 in respect of the
Defeased Securities shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Securities and this Indenture, to the
payment, either directly or through any Paying Agent (excluding the Company or
any of its Affiliates acting as Paying Agent), as the Trustee may determine, to
the Holders of such Securities of all sums due and to become due thereon in
respect of principal, premium, if any, and interest, but such money need not be
segregated from other funds
54
except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 404 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is
imposed, assessed or for the account of the Holders of the Defeased Securities.
Anything in this Article Four to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon Company
Request any United States dollars or U.S. Government Obligations held by it as
provided in Section 404 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 such defeasance.
Section 406. Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States
dollars or U.S. Government Obligations in accordance with Section 402 or 403, as
the case may be, by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, then
the Company's obligations under this Indenture and the Securities and any
Guarantor's obligations under any Guarantee shall be revived and reinstated,
with present and prospective effect, as though no deposit had occurred pursuant
to Section 402 or 403, as the case may be, until such time as the Trustee or
Paying Agent is permitted to apply all such United States dollars or U.S.
Government Obligations in accordance with Section 402 or 403, as the case may
be; provided, however, that if the Company makes any payment to the Trustee or
Paying Agent of principal of, premium, if any, or interest on any Security
following the reinstatement of its obligations, the Trustee or Paying Agent
shall promptly pay any such amount to the Holders of the Securities and the
Company shall be subrogated to the rights of the Holders of such Securities to
receive such payment from the United States dollars and U.S. Government
Obligations held by the Trustee or Paying Agent.
ARTICLE FIVE
REMEDIES
Section 501. Events of Default.
"Event of Default," wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
(a) there shall be a default in the payment of any interest on any
Security when it becomes due and payable, and such default shall continue
for a period of 30 days (provided that such 30 day grace period shall be
inapplicable for the first six interest payments due on the Securities);
(b) there shall be a default in the payment of the principal of (or
premium, if any, on) any Security at its Maturity (upon acceleration,
optional or mandatory redemption, required
55
repurchase or otherwise);
(c) (i) there shall be a default in the performance, or breach, of
any covenant or agreement of the Company or any Guarantor under this
Indenture, the Escrow Agreement, the Registration Rights Agreement or any
Guarantee (other than a default in the performance, or breach, of a
covenant or agreement which is specifically dealt with in clause (a), (b)
or in clause (ii), (iii) or (iv) of this clause (c)) and such default or
breach shall continue for a period of 30 days after written notice has
been given, by certified mail, (x) to the Company by the Trustee or (y) to
the Company and the Trustee by the Holders of at least 25% in aggregate
principal amount of the outstanding Securities; (ii) there shall be a
default in the performance or breach of the provisions of Article Eight;
(iii) the Company shall have failed to make or consummate an Offer in
accordance with the provisions of Section 1012; or (iv) the Company shall
have failed to make or consummate a Change of Control Offer in accordance
with the provisions of Section 1014;
(d) (i) any default by the Company or any Subsidiary in the payment
of the principal, premium, if any, or interest has occurred under any
agreement, indenture or instrument evidencing Indebtedness when the same
shall become due and payable in full and such default shall have continued
after any applicable grace period and shall not have been cured or waived
and, if not already matured at its final maturity in accordance with its
terms, the holder of such Indebtedness shall have the right to accelerate
such Indebtedness or (ii) any event of default as defined in any
agreement, indenture or instrument of the Company evidencing Indebtedness
shall have occurred and the Indebtedness thereunder, if not already
matured at its final maturity in accordance with its terms, shall have
been accelerated, and in the case of (i) or (ii) above, the principal
amount of such Indebtedness aggregates in excess of $5 million;
(e) any Guarantee shall for any reason cease to be, or shall for any
reason be asserted in writing by any Guarantor or the Company not to be,
in full force and effect and enforceable in accordance with its terms,
except to the extent contemplated by this Indenture and any such
Guarantee;
(f) one or more judgments, orders or decrees for the payment of
money in excess of $10 million, either individually or in the aggregate,
shall be rendered against the Company or any Subsidiary or any of their
respective properties which are not paid or covered by financially sound
third-party insurers, and there shall not be discharged and there shall
have been a period of 60 consecutive days during which a stay of
enforcement of such judgment or order, by reason of an appeal or
otherwise, shall not be in effect;
(g) any holder or holders of at least $5 million in aggregate
principal amount of Indebtedness of the Company or any Subsidiary after a
default under such Indebtedness shall notify the Trustee of its
commencement of proceedings to foreclose on any assets of the Company or
any Subsidiary that have been pledged to or for the benefit of such holder
or holders to secure such Indebtedness or shall commence proceedings, or
take any action (including by way of set-off), to retain in satisfaction
of such Indebtedness or to collect on, seize, dispose of or apply in
satisfaction of Indebtedness, assets of the Company or any Subsidiary
(including funds on deposit or held pursuant to lock-box and other similar
arrangements);
(h) there shall have been the entry by a court of competent
jurisdiction of (i) a decree or order for relief in respect of the Company
or any Subsidiary in an involuntary case or proceeding under any
applicable Bankruptcy Law or (ii) a decree or order adjudging the Company
56
or any Subsidiary bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment or composition of or in respect of the Company or
any Subsidiary under any applicable federal or state law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator (or other
similar official) of the Company or any Subsidiary or of any substantial
part of their respective properties, or ordering the winding up or
liquidation of their respective affairs, and any such decree or order for
relief shall continue to be in effect, or any such other decree or order
shall be unstayed and in effect, for a period of 60 consecutive days; or
(i) (i) the Company or any Subsidiary commences a voluntary case or
proceeding under any applicable Bankruptcy Law or any other case or
proceeding to be adjudicated bankrupt or insolvent, (ii) the Company or
any Subsidiary consents to the entry of a decree or order for relief in
respect of the Company or such Subsidiary in an involuntary case or
proceeding under any applicable Bankruptcy Law or to the commencement of
any bankruptcy or insolvency case or proceeding against it, (iii) the
Company or any Subsidiary files a petition or answer or consent seeking
reorganization or relief under any applicable federal or state law, (iv)
the Company or any Subsidiary (1) consents to the filing of such petition
or the appointment of, or taking possession by, a custodian, receiver,
liquidator, assignee, trustee, sequestrator or similar official of the
Company or such Subsidiary or of any substantial part of the Company's
consolidated properties, (2) makes an assignment for the benefit of
creditors or (3) admits in writing its inability to pay its debts
generally as they become due or (v) the Company, any Guarantor or any
Subsidiary takes any corporate action in furtherance of any such actions
in this paragraph (i); or
(j) the Company challenges the Lien on the Collateral under the
Escrow Agreement prior to such time as the Collateral is to be released to
the Company, or the Collateral becomes subject to any Lien other than the
Lien under the Escrow Agreement.
Section 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in
Sections 501(h) and (i) with respect to the Company) shall occur and be
continuing with respect to this Indenture, the Trustee or the Holders of not
less than 25% in aggregate principal amount of the Securities then Outstanding
may, and the Trustee at the request of such Holders shall, declare all unpaid
principal of, premium, if any, and accrued interest on all Securities to be due
and payable, by a notice in writing to the Company (and to the Trustee if given
by the Holders of the Securities) and upon any such declaration, such principal,
premium, if any, and interest shall become due and payable immediately. If an
Event of Default specified in Section 501(h) or (i) occurs with respect to the
Company and is continuing, then all the Securities shall ipso facto become and
be due and payable immediately in an amount equal to the principal amount of the
Securities, together with accrued and unpaid interest, if any, to the date the
Securities become due and payable, without any declaration or other act on the
part of the Trustee or any Holder. Thereupon, the Trustee may, at its
discretion, proceed to protect and enforce the rights of the Holders of the
Securities by appropriate judicial proceedings.
After a declaration of acceleration with respect to the Securities,
but before a judgment or decree for payment of the money due has been obtained
by the Trustee as hereinafter provided in this Article, the Holders of a
majority in aggregate principal amount of the Securities Outstanding, by written
notice to the Company and the Trustee, may rescind and annul such declaration
and its consequences if:
(a) the Company has paid or deposited with the Trustee a sum
sufficient to pay:
57
(i) all sums paid or advanced by the Trustee under this
Indenture and the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel,
(ii) all overdue interest on all Outstanding
Securities,
(iii) the principal of and premium, if any, on any Outstanding
Securities which have become due otherwise than by such declaration
of acceleration and interest thereon at a rate borne by the
Securities, and
(iv) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate borne by the Securities;
and
(b) all Events of Default, other than the non-payment of principal
of the Securities which have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 513. No
such rescission shall affect any subsequent Default or impair any right
consequent thereon.
Section 503. Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Company and each Guarantor covenant that if
(a) there shall be a default in the payment of any interest on any
Security when such interest becomes due and payable and such default
continues for a period of 30 days, or
(b) there shall be a default in the payment of the principal of or
premium, if any, on any Security at the Stated Maturity thereof, the
Company and such Guarantor will, upon demand of the Trustee, pay to it,
for the benefit of the Holders of such Securities, the whole amount then
due and payable on such Securities for principal and premium, if any, and
interest, with interest upon the overdue principal and premium, if any,
and, to the extent that payment of such interest shall be legally
enforceable, upon overdue installments of interest, at the rate borne by
the Securities; and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel and any other amounts due the Trustee
under Section 607.
If the Company or any Guarantor, as the case may be, fails to pay
such amounts forthwith upon such demand, the Trustee, in its own name and as
trustee of an express trust, may institute a judicial proceeding for the
collection of the sums so due and unpaid and may prosecute such proceeding to
judgment or final decree, and may enforce the same against the Company or any
Guarantor or any other obligor upon the Securities and collect the moneys
adjudged or decreed to be payable in the manner provided by law out of the
property of the Company, any Guarantor or any other obligor upon the Securities,
wherever situated.
If an Event of Default occurs and is continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of the
Holders under this Indenture, the Escrow Agreement or any Guarantee by such
appropriate private or judicial proceedings as the Trustee shall deem most
effectual to protect and enforce such rights, including seeking recourse against
any Guarantor pursuant to
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the terms of any Guarantee, whether for the specific enforcement of any covenant
or agreement in this Indenture or in aid of the exercise of any power granted
herein or therein, or to enforce any other proper remedy, including, without
limitation, seeking recourse against any Guarantor pursuant to the terms of a
Guarantee, or to enforce any other proper remedy, subject however to Section
512. No recovery of any such judgment upon any property of the Company or any
Guarantor shall affect or impair any rights, powers or remedies of the Trustee
or the Holders.
Section 504. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor,
including any Guarantor, upon the Securities or the property of the Company or
of such other obligor or their creditors, the Trustee (irrespective of whether
the principal of the Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand on the Company for the payment of overdue principal
or interest) shall be entitled and empowered, by intervention in such proceeding
or otherwise,
(a) to file and prove a claim for the whole amount of principal, and
premium, if any, and interest owing and unpaid in respect of the
Securities and to file such 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 any other amounts due
the Trustee under Section 607) and of the Holders allowed in such judicial
proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same; and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or
similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that
the Trustee shall consent to the making of such payments directly to the
Holders, to pay the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel, and any other amounts due the Trustee under Section
607.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
Section 505. Trustee May Enforce Claims without Possession of
Securities.
All rights of action and claims under this Indenture, the Securities
or the Guarantees may be prosecuted and enforced by the Trustee without the
possession of any of the Securities or the production thereof in any proceeding
relating thereto, and any such proceeding instituted by the Trustee shall be
brought in its own name and as trustee of an express trust, and any recovery of
judgment shall, after provision for the payment of the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, be
for the ratable benefit of the Holders of the Securities in respect of which
such judgment has been recovered.
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Section 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article or the
Escrow Agreement or otherwise on behalf of the Holders or the Trustee pursuant
to this Article or the Escrow Agreement or through any proceeding or any
arrangement or restructuring in anticipation or in lieu of any proceeding
contemplated by this Article or the Escrow Agreement shall be applied, subject
to applicable law, in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such money on account of principal,
premium, if any, or interest, upon presentation of the Securities and the
notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 607;
SECOND: To the payment of the amounts then due and unpaid upon the
Securities for principal, premium, if any, and interest, in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due
and payable on such Securities for principal, premium, if any, and
interest; and
THIRD: The balance, if any, to the Person or Persons entitled
thereto, including the Company, provided that all sums due and owing to
the Holders and the Trustee have been paid in full as required by this
Indenture.
Section 507. Limitation on Suits.
No Holder of any Securities shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture or the
Securities, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
(a) such Holder has previously given written notice to the Trustee
of a continuing Event of Default;
(b) the Holders of not less than 25% in principal amount of the
Outstanding Securities shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name
as trustee hereunder;
(c) such Holder or Holders have offered to the Trustee an indemnity
satisfactory to the Trustee against the costs, expenses and liabilities to
be incurred in compliance with such request;
(d) the Trustee for 15 days after its receipt of such notice,
request and offer (and if requested, provision) of indemnity has failed to
institute any such proceeding; and
(e) no direction inconsistent with such written request has been
given to the Trustee during such 15-day period by the Holders of a
majority in principal amount of the Outstanding Securities;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture, any Security or any Guarantee to affect, disturb or prejudice
the rights of any other Holders, or to obtain or to seek to obtain priority or
preference over any other Holders or to enforce any right under this Indenture,
any Security or any Guarantee, except
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in the manner provided in this Indenture and for the equal and ratable benefit
of all the Holders.
Section 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right based on the terms stated herein, which is
absolute and unconditional, to receive payment of the principal of, premium, if
any, and (subject to Section 309) interest on such Security on the respective
Stated Maturities expressed in such Security (or, in the case of redemption or
repurchase, on the Redemption Date or the repurchase date) and to institute suit
for the enforcement of any such payment, and such rights shall not be impaired
without the consent of such Holder.
Section 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture or any Guarantee and such
proceeding has been discontinued or abandoned for any reason, or has been
determined adversely to the Trustee or to such Holder, then and in every such
case the Company, any Guarantor, any other obligor on the Securities, the
Trustee and the Holders shall, subject to any determination in such proceeding,
be restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
Section 510. Rights and Remedies Cumulative.
No right or remedy herein conferred upon or reserved to the Trustee
or to the Holders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Security
to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein. Every right and remedy given by this Article or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
Section 512. Control by Holders.
The Holders of not less than a majority in aggregate principal
amount of the Outstanding Securities shall have the right to direct the time,
method and place of conducting any proceeding for exercising any remedy
available to the Trustee, or exercising any trust or power conferred on the
Trustee, provided that
(a) such direction shall not be in conflict with any rule of law or
with this Indenture (including, without limitation, Section 507), the
Escrow Agreement or any Guarantee, expose the
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Trustee to personal liability, or be unduly prejudicial to Holders not
joining therein; and
(b) subject to the provisions of Section 315 of the Trust Indenture
Act, the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in aggregate principal
amount of the Outstanding Securities may on behalf of the Holders of all
Outstanding Securities waive any past Default hereunder and its consequences,
except a Default
(a) in the payment of the principal of, premium, if any,
or interest on any Security, or
(b) in respect of a covenant or a provision hereof which under this
Indenture cannot be modified or amended without the consent of the Holder
of each Security Outstanding affected by such modification or amendment.
Upon any such waiver, such Default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or impair any right consequent thereon.
Section 514. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant, but the
provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% in principal amount of the Outstanding Securities,
or to any suit instituted by any Holder for the enforcement of the payment of
the principal of, premium, if any, or interest on, any Security on or after the
respective Stated Maturities expressed in such Security (or, in the case of
redemption, on or after the Redemption Date).
Section 515. Waiver of Stay, Extension or Usury Laws.
Each of the Company and the Guarantors covenants (to the extent that
it may lawfully do so) that it will not at any time insist upon, or plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury or other law wherever enacted, now or at any time
hereafter in force, which would prohibit or forgive the Company or any Guarantor
from paying all or any portion of the principal of, premium, if any, or interest
on the Securities contemplated herein or in the Securities or which may affect
the covenants or the performance of this Indenture; and each of the Company and
the Guarantors (to the extent that it may lawfully do so) hereby expressly
waives all benefit or advantage of any such law, and covenants that it 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 516. Remedies Subject to Applicable Law.
All rights, remedies and powers provided by this Article Five may be
exercised only to the extent that the exercise thereof does not violate any
applicable provision of law in the premises, and all the provisions of this
Indenture are intended to be subject to all applicable mandatory provisions of
law which may be controlling in the premises and to be limited to the extent
necessary so that they will not render this Indenture invalid, unenforceable or
not entitled to be recorded, registered or filed under the provisions of any
applicable law.
ARTICLE SIX
THE TRUSTEE
Section 601. Duties of Trustee.
Subject to the provisions of Trust Indenture Act Sections 315(a)
through 315(d):
(a) if an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture and use the same degree of care and skill in its exercise
thereof as a prudent person would exercise or use under the circumstances
in the conduct of his own affairs;
(b) except during the continuance of an Event of Default:
(1) the Trustee need perform only those duties as are
specifically set forth in this Indenture and no covenants or
obligations shall be implied in this Indenture that are adverse to
the Trustee; and
(2) in the absence of bad faith or willful misconduct on its
part, the Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, on
certificates or opinions furnished to the Trustee and conforming to
the requirements of this Indenture or the Escrow Agreement;
provided, however, that the Trustee shall examine the certificates
and opinions to determine whether or not they conform to the
requirements of this Indenture or the Escrow Agreement;
(c) the Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) this Subsection (c) does not limit the effect of
Subsection (b) of this Section 601;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved
that the Trustee was negligent in ascertaining the pertinent facts;
and
(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 of the Holders of a majority in principal amount of
Outstanding Securities relating to the time, method and place of
conducting
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any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee under this
Indenture or the Escrow Agreement;
(d) no provision of this Indenture or the Escrow Agreement shall
require the Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder or
in the exercise of any of its rights or powers if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it;
(e) whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to
Subsections (a), (b), (c), (d) and (f) of this Section 601; and
(f) the Trustee shall not be liable for interest on any money or
assets received by it except as the Trustee may agree in writing with the
Company. Assets held in trust by the Trustee need not be segregated from
other assets except to the extent required by law.
Section 602. Notice of Defaults.
Within 30 days after a Responsible Officer of the Trustee receives
notice of the occurrence of any Default, the Trustee shall transmit by mail to
all Holders and any other Persons entitled to receive reports pursuant to
Section 313(c) of the Trust Indenture Act, as their names and addresses appear
in the Security Register, notice of such Default hereunder known to the Trustee,
unless such Default shall have been cured or waived; provided, however, that,
except in the case of a Default in the payment of the principal of, premium, if
any, or interest on any Security or a Default in complying with any of the
provisions of the Escrow Agreement, the Trustee shall be protected in
withholding such notice if and so long as a trust committee of Responsible
Officers of the Trustee in good faith determines that the withholding of such
notice is in the interest of the Holders.
Section 603. Certain Rights of Trustee.
Subject to the provisions of Section 601 hereof and Trust Indenture
Act Sections 315(a) through 315(d):
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon receipt by it of any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of Indebtedness or
other paper or document believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein shall
be sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a
Board Resolution;
(c) the Trustee may consult with counsel of its selection and any
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance thereon
in accordance with such advice or Opinion of Counsel;
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(d) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture or the Escrow Agreement at
the request or direction of any of the Holders pursuant to this Indenture,
unless such Holders shall have offered to the Trustee security or
indemnity satisfactory to the Trustee against the costs, expenses and
liabilities which might be incurred thereby;
(e) the Trustee shall not be liable for any action taken or omitted
by it in good faith and believed by it to be authorized or within the
discretion, rights or powers conferred upon it by this Indenture other
than any liabilities arising out of the negligence, bad faith or willful
misconduct of the Trustee;
(f) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
approval, appraisal, bond, debenture, note, coupon, security or other
paper or document unless requested in writing to do so by the Holders of
not less than a majority in aggregate principal amount of the Securities
then Outstanding; provided that, if the payment within a reasonable time
to the Trustee of the costs, expenses or liabilities likely to be incurred
by it in the making of such investigation is, in the opinion of the
Trustee, not reasonably assured to the Trustee by the security afforded to
it by the terms of this Indenture, the Trustee may require reasonable
indemnity against such expenses or liabilities as a condition to
proceeding; the reasonable expenses of every such investigation so
requested by the Holders of not less than 25% in aggregate principal
amount of the Securities Outstanding shall be paid by the Company or, if
paid by the Trustee or any predecessor Trustee, shall be repaid by the
Company upon demand; provided, further, the Trustee in its discretion may
make such further inquiry or investigation into such facts or matters as
it may deem fit, and, if the Trustee shall determine to make such further
inquiry or investigation, it shall be entitled to examine the books,
records and premises of the Company, personally or by agent or attorney;
provided, further, that no permissive power, right or remedy conferred
upon the Trustee under this Indenture shall be construed to impose a duty
to exercise such power, right or remedy;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder; and
(h) the Trustee shall not be charged with knowledge of any Default
or Event of Default, of the identity of any Restricted Subsidiary or of
the existence of any Change of Control or Asset Sale unless either (i) a
Responsible Officer shall have actual knowledge thereof, or (ii) the
Trustee shall have received written notice thereof from the Company or any
Holder of the Securities.
Section 604. Trustee Not Responsible for Recitals, Dispositions of
Securities or Application of Proceeds Thereof.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture, the Escrow Agreement or of the Securities. The Trustee shall not be
accountable for the use or application by the Company of Securities or the
proceeds thereof.
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Section 605. Trustee and Agents May Hold Securities; Collections;
etc.
The Trustee, any Paying Agent, Security Registrar or any other agent
of the Company, in its individual or any other capacity, may become the owner or
pledgee of Securities, with the same rights it would have if it were not the
Trustee, Paying Agent, Security Registrar or such other agent and, subject to
Trust Indenture Act Sections 310 and 311, may otherwise deal with the Company
and receive, collect, hold and retain collections from the Company with the same
rights it would have if it were not the Trustee, Paying Agent, Security
Registrar or such other agent.
Section 606. Money Held in Trust.
All moneys received by the Trustee shall, until used or applied as
herein provided, be held in trust for the purposes for which they were received,
but need not be segregated from other funds except to the extent required by
mandatory provisions of law. Except for funds or securities deposited with the
Trustee pursuant to Article Four, the Trustee shall be required to invest all
moneys received by the Trustee, until used or applied as herein provided, in
Cash Equivalents in accordance with the written directions of the Company;
provided, however, that nothing herein shall be deemed to require the Trustee or
any other Person acting as Paying Agent to invest or pay interest on funds held
for the payment of any Securities after the Maturity thereof.
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Section 607. Compensation and Indemnification of Trustee and Its
Prior Claim.
The Company covenants and agrees to pay to the Trustee from time to
time, and the Trustee shall be entitled to, such compensation as the parties
have agreed in accordance with Schedule II attached to the Escrow Agreement for
all services rendered by it hereunder (which compensation shall not be limited
by any provision of law in regard to the compensation of a trustee of an express
trust) and the Company covenants and agrees to pay or reimburse the Trustee and
each predecessor Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by or on behalf of the Trustee in
accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its counsel and of
all agents and other Persons not regularly in its employ) except any such
expense, disbursement or advance as may arise from its negligence, bad faith or
willful misconduct. The Company also covenants and agrees to indemnify the
Trustee and each predecessor Trustee for, and to hold it harmless against, any
claim, loss, liability, tax, assessment or other governmental charge (other than
taxes applicable to the Trustee's compensation hereunder) or expense incurred
without negligence, bad faith or willful misconduct on its part, arising out of
or in connection with the acceptance or administration of this Indenture or the
trusts hereunder and its duties hereunder, including enforcement of this Section
607 and also including any liability which the Trustee may incur as a result of
failure to withhold, pay or report any tax, assessment or other governmental
charge, and the costs and expenses of defending itself against or investigating
any claim or liability in connection with the exercise or performance of any of
its powers or duties hereunder. The obligations of the Company under this
Section 607 to compensate and indemnify the Trustee and each predecessor Trustee
and to pay or reimburse the Trustee and each predecessor Trustee for reasonable
expenses, disbursements and advances shall constitute an additional obligation
hereunder and shall survive the satisfaction and discharge of this Indenture and
the resignation or removal of the Trustee and each predecessor Trustee. As
security for the performance of the obligations of the Company under this
Section 607, the Trustee shall have a lien prior to the Securities upon all
property and funds held or collected by the Trustee as such, except funds held
in trust for the benefit of the Holders of particular Securities. When the
Trustee incurs expenses or renders services after an Event of Default specified
in Section 501(h) or (i) hereof occurs, the expenses and the compensation for
such services (including the fees and expenses of its agents and counsel) are
intended to constitute expenses of administration under any Bankruptcy Law.
Section 608. Conflicting Interests.
The Trustee shall comply with the provisions of Section 310(b) of
the Trust Indenture Act.
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Section 609. Trustee Eligibility.
There shall at all times be a Trustee hereunder which shall be
eligible to act as trustee under Trust Indenture Act Section 310(a) and which
shall have a combined capital and surplus of at least $100,000,000, to the
extent there is an institution eligible and willing to serve. If the Trustee
does not have a Corporate Trust Office in The City of New York, the Trustee may
appoint an agent in The City of New York reasonably acceptable to the Company to
conduct any activities which the Trustee may be required under this Indenture to
conduct in The City of New York. If such Trustee publishes reports of condition
at least annually, pursuant to law or to the requirements of federal, state,
territorial or District of Columbia supervising or examining authority, then for
the purposes of this Section 609, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section
609, the Trustee shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
Section 610. Resignation and Removal; Appointment of Successor
Trustee.
(a) No resignation or removal of the Trustee and no appointment of a
successor trustee pursuant to this Article shall become effective until
the acceptance of appointment by the successor trustee under Section 611.
(b) The Trustee, or any trustee or trustees hereafter appointed, may
at any time resign by giving written notice thereof to the Company. Upon
receiving such notice or resignation, the Company shall promptly appoint a
successor trustee by written instrument executed by authority of the Board
of Directors of the Company, a copy of which shall be delivered to the
resigning Trustee and a copy to the successor trustee. If an instrument of
acceptance by a successor trustee shall not have been delivered to the
Trustee within 30 days after the giving of such notice of resignation, the
resigning Trustee may, or any Holder who has been a bona fide Holder of a
Security for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor trustee. Such court may thereupon, after such
notice, if any, as it may deem proper, appoint and prescribe a successor
trustee.
(c) The Trustee may be removed at any time for any cause or for no
cause by an Act of the Holders of not less than a majority in aggregate
principal amount of the Outstanding Securities, delivered to the Trustee
and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with the provisions of
Trust Indenture Act Section 310(b) after written request therefor by
the Company or by any Holder who has been a bona fide Holder of a
Security for at least six months,
(2) the Trustee shall cease to be eligible under Section 609
and shall fail to resign after written request therefor by the
Company or by any Holder who has been a bona fide Holder of a
Security for at least six months, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a
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bankrupt or insolvent, or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge
or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation, then, in any
case, (i) the Company by a Board Resolution may remove the Trustee,
or (ii) subject to Section 514, the Holder of any Security who has
been a bona fide Holder of a Security for at least six months may,
on behalf of himself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor trustee. Such court may thereupon,
after such notice, if any, as it may deem proper and prescribe,
remove the Trustee and appoint a successor trustee.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any
cause, the Company, by a Board Resolution, shall promptly appoint a
successor trustee and shall comply with the applicable requirements of
Section 611. If, within 60 days after such resignation, removal or
incapability, or the occurrence of such vacancy, the Company has not
appointed a successor Trustee, a successor trustee shall be appointed by
the Act of the Holders of a majority in principal amount of the
Outstanding Securities delivered to the Company and the retiring Trustee.
Such successor trustee so appointed shall forthwith upon its acceptance of
such appointment become the successor trustee and supersede the successor
trustee appointed by the Company. If no successor trustee shall have been
so appointed by the Company or the Holders of the Securities and accepted
appointment in the manner hereinafter provided, the Trustee or the Holder
of any Security who has been a bona fide Holder for at least six months
may, subject to Section 514, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the appointment
of a successor trustee.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor trustee by
mailing written notice of such event by first-class mail, postage prepaid,
to the Holders of Securities as their names and addresses appear in the
Security Register. Each notice shall include the name of the successor
trustee and the address of its Corporate Trust Office or agent hereunder.
Section 611. Acceptance of Appointment by Successor.
Every successor trustee appointed hereunder shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee as if originally named as
Trustee hereunder; but, nevertheless, on the written request of the Company or
the successor trustee, upon payment of its charges pursuant to Section 607 then
unpaid, such retiring Trustee shall pay over to the successor trustee all moneys
at the time held by it hereunder and shall execute and deliver an instrument
transferring to such successor trustee all such rights, powers, duties and
obligations. Upon request of any such successor trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor trustee all such rights and powers.
No successor trustee with respect to the Securities shall accept
appointment as provided in this Section 611 unless at the time of such
acceptance such successor trustee shall be eligible to act as trustee under the
provisions of Trust Indenture Act Section 310(a) and this Article Six and shall
have a combined capital and surplus of at least $100,000,000 and have a
Corporate Trust Office or an agent selected in accordance with Section 609.
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Upon acceptance of appointment by any successor trustee as provided
in this Section 611, the Company shall give notice thereof to the Holders of the
Securities, by mailing such notice to such Holders at their addresses as they
shall appear on the Security Register. If the acceptance of appointment is
substantially contemporaneous with the appointment, then the notice called for
by the preceding sentence may be combined with the notice called for by Section
610. If the Company fails to give such notice within 10 days after acceptance of
appointment by the successor trustee, the successor trustee shall cause such
notice to be given at the expense of the Company.
Section 612. Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee (including the trust created by this Indenture), shall
be the successor of the Trustee hereunder, provided that such corporation shall
be eligible under Trust Indenture Act Section 310(a) and this Article Six and
shall have a combined capital and surplus of at least $100,000,000 and have a
Corporate Trust Office or an agent selected in accordance with Section 609,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto.
In case at the time such successor to the Trustee shall succeed to
the trusts created by this Indenture any of the Securities shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor Trustee and deliver such
Securities so authenticated; and, in case at that time any of the Securities
shall not have been authenticated, any successor to the Trustee may authenticate
such Securities either in the name of any predecessor hereunder or in the name
of the successor trustee; and in all such cases such certificate shall have the
full force which it is anywhere in the Securities or in this Indenture; provided
that the right to adopt the certificate of authentication of any predecessor
Trustee or to authenticate Securities in the name of any predecessor Trustee
shall apply only to its successor or successors by merger, conversion or
consolidation.
Section 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company
(or other obligor under the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor). A Trustee who has resigned or been
removed shall be subject to Trust Indenture Act Section 311(a) to the extent
indicated therein.
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 701. Company to Furnish Trustee Names and Addresses of
Holders.
The Company will furnish or cause to be furnished to the
Trustee
(a) semiannually, not more than 15 days after each Regular Record
Date, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Holders as of such Regular Record Date; and
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(b) at such other times as the Trustee may reasonably request in
writing, within 30 days after receipt by the Company of any such request,
a list of similar form and content to that in subsection (a) hereof as of
a date not more than 15 days prior to the time such list is furnished;
provided, however, that if and so long as the Trustee shall be the Security
Registrar, no such list need be furnished.
Section 702. Disclosure of Names and Addresses of Holders.
Holders may communicate pursuant to Trust Indenture Act Section
312(b) with other Holders with respect to their rights under this Indenture or
the Securities, and the Trustee shall comply with Trust Indenture Act Section
312(b). The Company, the Trustee, the Security Registrar and any other Person
shall have the protection of Trust Indenture Act Section 312(c). Further, every
Holder of Securities, by receiving and holding the same, agrees with the Company
and the Trustee that neither the Company nor the Trustee or any agent of either
of them shall be held accountable by reason of the disclosure of any information
as to the names and addresses of the Holders in accordance with Trust Indenture
Act Section 312, regardless of the source from which such information was
derived, and that the Trustee shall not be held accountable by reason of mailing
any material pursuant to a request made under Trust Indenture Act Section 312.
Section 703. Reports by Trustee.
(a) Within 60 days after May 15 of each year commencing with the
first May 15 after the issuance of Securities, the Trustee, if so required
under the Trust Indenture Act, shall transmit by mail to all Holders, in
the manner and to the extent provided in Trust Indenture Act Section
313(c), a brief report dated as of such May 15 in accordance with and with
respect to the matters required by Trust Indenture Act Section 313(a). The
Trustee shall also transmit by mail to all Holders, in the manner and to
the extent provided in Trust Indenture Act Section 313(c), a brief report
in accordance with and with respect to the matters required by Trust
Indenture Act Section 313(b)(2).
(b) A copy of each report transmitted to Holders pursuant to this
Section 703 shall, at the time of such transmission, be mailed to the
Company and filed with each stock exchange, if any, upon which the
Securities are listed and also with the Commission. The Company will
notify the Trustee promptly if the Securities are listed on any stock
exchange.
Section 704. Reports by Company.
The Company and any Guarantor, as the case may be, shall:
(a) file with the Trustee, within 15 days after the Company or any
Guarantor, as the case may be, is required to file the same with the
Commission, copies of the annual reports and of the information, documents
and other reports (or copies of such portions of any of the foregoing as
the Commission may from time to time by rules and regulations prescribe)
which the Company or any Guarantor may be required to file with the
Commission pursuant to Section 13 or Section 15(d) of the Exchange Act;
or, if the Company or any Guarantor, as the case may be, is not required
to file information, documents or reports pursuant to either of said
sections, then it shall (i) deliver to the Trustee annual audited
financial statements of the Company and its Subsidiaries,
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prepared on a Consolidated basis in conformity with GAAP, within 120 days
after the end of each fiscal year of the Company, and (ii) file with the
Trustee and, to the extent permitted by law, the Commission, in accordance
with the rules and regulations prescribed from time to time by the
Commission, such of the supplementary and periodic information, documents
and reports which may be required pursuant to Section 13 of the Exchange
Act in respect of a security listed and registered on a national
securities exchange as may be prescribed from time to time in such rules
and regulations;
(b) file with the Trustee and the Commission, in accordance with the
rules and regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect to compliance
by the Company or any Guarantor, as the case may be, with the conditions
and covenants of this Indenture as are required from time to time by such
rules and regulations (including such information, documents and reports
referred to in Trust Indenture Act Section 314(a)); and
(c) within 15 days after the filing thereof with the Trustee,
transmit by mail to all Holders in the manner and to the extent provided
in Trust Indenture Act Section 313(c), such summaries of any information,
documents and reports required to be filed by the Company or any
Guarantor, as the case may be, pursuant to Section 1020 hereunder and
subsections (a) and (b) of this Section 704 as are required by rules and
regulations prescribed from time to time by the Commission.
ARTICLE EIGHT
CONSOLIDATION, MERGER, SALE OF ASSETS
Section 801. Company and Guarantors May Consolidate, etc., Only on
Certain Terms.
(a) The Company will not, in a single transaction or through a
series of related transactions, consolidate with or merge with or into any
other Person or sell, assign, convey, transfer, lease or otherwise dispose
of all or substantially all of its properties and assets to any Person or
group of affiliated Persons, or permit any of its Subsidiaries to enter
into any such transaction or series of related transactions if such
transaction or series of related transactions, in the aggregate, would
result in a sale, assignment, conveyance, transfer, lease or disposition
of all or substantially all of the properties and assets of the Company
and its Subsidiaries on a consolidated basis to any other Person or group
of affiliated Persons, unless at the time and after giving effect thereto:
(i) either (a) the Company will be the continuing corporation
in the case of a consolidation or merger involving the Company or
(b) the Person (if other than the Company) formed by such
consolidation or into which the Company is merged or the Person
which acquires by sale, assignment, conveyance, transfer, lease or
disposition all or substantially all of the properties and assets of
the Company and its Subsidiaries on a Consolidated basis (the
"Surviving Entity") will be a corporation duly organized and validly
existing under the laws of the United States of America, any state
thereof or the District of Columbia and such Person expressly
assumes, by a supplemental indenture, in a form reasonably
satisfactory to the Trustee, all the obligations of the Company
under the Securities, this Indenture, the Escrow Agreement and the
Registration Rights
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Agreement, as the case may be, and the Securities, this Indenture,
the Escrow Agreement and the Registration Rights Agreement will
remain in full force and effect as so supplemented;
(ii) immediately before and immediately after giving effect to
such transaction on a pro forma basis (and treating any Indebtedness
not previously an obligation of the Company or any of its
Subsidiaries which becomes the obligation of the Company or any of
its Subsidiaries as a result of such transaction as having been
incurred at the time of such transaction), no Default or Event of
Default will have occurred and be continuing;
(iii) immediately before and immediately after giving effect to
such transaction on a pro forma basis (on the assumption that the
transaction occurred on the first day of the four-quarter period for
which financial statements are available ending immediately prior to
the consummation of such transaction with the appropriate
adjustments with respect to the transaction being included in such
pro forma calculation), the Company (or the Surviving Entity if the
Company is not the continuing obligor hereunder) could incur $1.00
of additional Indebtedness under Section 1008(a);
(iv) at the time of the transaction, each Guarantor, if any,
unless it is the other party to the transactions described above,
will have by supplemental indenture confirmed that its Guarantee
shall apply to such Person's obligations under this Indenture and
under the Securities;
(v) at the time of the transaction if any of the property or
assets of the Company or any of its Subsidiaries would thereupon
become subject to any Lien, the provisions of Section 1011 are
complied with;
(vi) such transaction would not result in the loss, material
impairment or adverse modification or amendment of any authorization
or license of the Company or its Subsidiaries that could have a
material adverse effect on the Company's business, financial
condition or results of operations; and
(vii) at the time of the transaction the Company or the
Surviving Entity will have delivered, or caused to be delivered, to
the Trustee, in form and substance reasonably satisfactory to the
Trustee, an Officers' Certificate and an Opinion of Counsel, each to
the effect that such consolidation, merger, transfer, sale,
assignment, conveyance, transfer, lease or other transaction and the
supplemental indenture in respect thereof comply with this Indenture
and that all conditions precedent herein provided for relating to
such transaction have been complied with.
(b) Notwithstanding the foregoing, the provisions of Section 801(a)
(iii) shall not apply to (i) a merger or consolidation between the Company
and any of its Subsidiaries or between one or more of its Subsidiaries,
and (ii) a merger or consolidation of the Company into any Person in a
transaction designed solely for the purpose of effecting a change in the
jurisdiction of incorporation of the Company within the United States of
America.
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Section 802. Successor Substituted.
In the event of any transaction (other than a lease) described in
and complying with the conditions listed in Section 801 in which the Company is
not the surviving Person, such surviving Person shall succeed to, and be
substituted for, and may exercise every right and power of, the Company and the
Company shall be discharged from all obligations and covenants under this
Indenture, the Securities, the Escrow Agreement and the Registration Rights
Agreement.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 901. Supplemental Indentures and Agreements without Consent
of Holders.
Without the consent of any Holders, the Company, the Guarantors, if
any, and any other obligor under the Securities when authorized by a Board
Resolution, and the Trustee, at any time and from time to time, may enter into
one or more indentures supplemental hereto or agreements or other instruments
with respect to any Guarantee, in form and substance satisfactory to the
Trustee, for any of the following purposes:
(a) to evidence the succession of another Person to the Company or a
Guarantor and the assumption by any such successor of the covenants of the
Company or such Guarantor herein and in the Securities, the Registration
Rights Agreement, the Escrow Agreement and in any Guarantee in accordance
with Article Eight;
(b) to add to the covenants of the Company, any Guarantor or any
other obligor upon the Securities for the benefit of the Holders, or to
surrender any right or power conferred upon the Company or any Guarantor
or any other obligor upon the Securities, as applicable, herein, in the
Securities or in any Guarantee;
(c) to cure any ambiguity, or to correct or supplement any provision
herein or in any supplemental indenture, the Securities or any Guarantee
which may be defective or inconsistent with any other provision herein or
in the Securities or any Guarantee or to make any other provisions with
respect to matters or questions arising under this Indenture, the
Securities or any Guarantee; provided that, in each case, such provisions
shall not adversely affect the interest of the Holders;
(d) to comply with the requirements of the Commission in order to
effect or maintain the qualification of this Indenture under the Trust
Indenture Act, as contemplated by Section 905 or otherwise;
(e) to add a Guarantor pursuant to the requirements of
Section 1013;
(f) to evidence and provide the acceptance of the appointment of a
successor trustee hereunder; or
(g) to mortgage, pledge, hypothecate or grant a security interest in
favor of the Trustee for the benefit of the Holders as additional security
for the payment and performance of the
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Company's or any Guarantor's Indenture Obligations, in any property, or
assets, including any of which are required to be mortgaged, pledged or
hypothecated, or in which a security interest is required to be granted to
the Trustee pursuant to this Indenture or otherwise.
Section 902. Supplemental Indentures and Agreements with Consent of
Holders.
Except as permitted by Section 901, with the consent of the Holders
of at least a majority in aggregate principal amount of the Outstanding
Securities, by Act of said Holders delivered to the Company, each Guarantor, if
any, and the Trustee, the Company and each Guarantor (if a party thereto) when
authorized by Board Resolutions, and the Trustee may (i) enter into an indenture
or indentures supplemental hereto or agreements or other instruments with
respect to any Guarantee in form and substance satisfactory to the Trustee, for
the purpose of adding any provisions to or amending, modifying or changing in
any manner or eliminating any of the provisions of this Indenture, the
Securities or any Guarantee (including but not limited to, for the purpose of
modifying in any manner the rights of the Holders under this Indenture, the
Securities or any Guarantee) or (ii) waive compliance with any provision in this
Indenture, the Securities or any Guarantee (other than waivers of past Defaults
covered by Section 513 and waivers of covenants which are covered by Section
1021); provided, however, that no such supplemental indenture, agreement or
instrument shall, without the consent of the Holder of each Outstanding Security
affected thereby:
(a) change the Stated Maturity of the principal of, or any
installment of interest on, or change to an earlier date any redemption
date of, or waive a default in the payment of the principal or interest
on, any such Security or reduce the principal amount thereof or the rate
of interest thereon or any premium payable upon the redemption thereof, or
change the coin or currency in which the principal of any Security or any
premium or the interest thereon is payable, or impair the right to
institute suit for the enforcement of any such payment on or after the
Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date);
(b) amend, change or modify the obligation of the Company to make
and consummate an Offer with respect to any Asset Sale or Asset Sales in
accordance with Section 1012 or the obligation of the Company to make and
consummate a Change of Control Offer in the event of a Change of Control
in accordance with Section 1014, including, in each case, amending,
changing or modifying any definitions relating thereto;
(c) reduce the percentage in principal amount of the Outstanding
Securities, the consent of whose Holders is required for any such
supplemental indenture, or the consent of whose Holders is required for
any waiver or compliance with certain provisions of this Indenture;
(d) modify any of the provisions of this Section 902 or Section 513
or 1021, except to increase the percentage of such Outstanding Securities
required for any such actions or to provide that certain other provisions
of this Indenture cannot be modified or waived without the consent of the
Holder of each such Security affected thereby;
(e) except as otherwise permitted under Article Eight, consent to
the assignment or transfer by the Company or any Guarantor of any of its
rights and obligations hereunder;
(f) amend or modify any of the provisions of this Indenture in any
manner which subordinates the Securities issued hereunder in right of
payment to any other Indebtedness of the
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Company or which subordinates any Guarantee in right of payment to any
other Indebtedness of the Guarantor issuing such Guarantee; or
(g) modify the provisions of the Escrow Agreement or this Indenture
relating to the Collateral in any manner adverse to the Holders or release
any of the Collateral from the Lien under the Escrow Agreement or permit
any other obligation to be secured by the Collateral.
Upon the written request of the Company and each Guarantor, if any,
accompanied by a copy of Board Resolutions authorizing the execution of any such
supplemental indenture or Guarantee, and upon the filing with the Trustee of
evidence of the consent of Holders as aforesaid, the Trustee shall join with the
Company and each Guarantor in the execution of such supplemental indenture or
Guarantee.
It shall not be necessary for any Act of Holders under this Section
902 to approve the particular form of any proposed supplemental indenture or
Guarantee or agreement or instrument relating to any Guarantee, but it shall be
sufficient if such Act shall approve the substance thereof.
Section 903. Execution of Supplemental Indentures and Agreements.
In executing, or accepting the additional trusts created by, any
supplemental indenture, agreement, instrument or waiver permitted by this
Article Nine or the modifications thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and (subject to Trust
Indenture Act Sections 315(a) through 315(d) and Section 603 hereof) shall be
fully protected in relying upon, an Opinion of Counsel and an Officers'
Certificate, each complying with Section 103 and stating that the execution of
such supplemental indenture, agreement or instrument is authorized or permitted
by this Indenture. The Trustee may, but shall not be obligated to, enter into
any such supplemental indenture, agreement or instrument which affects the
Trustee's own rights, duties or immunities under this Indenture, any Guarantee
or otherwise.
Section 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article Nine
shall conform to the requirements of the Trust Indenture Act as then in effect.
Section 906. Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article Nine may, and shall if required
by the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Trustee and the
Board of Directors, to any such supplemental indenture may be prepared and
executed by the Company and each Guarantor and authenticated and delivered by
the Trustee in exchange for Outstanding Securities.
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Section 907. Notice of Supplemental Indentures.
Promptly after the execution by the Company, any Guarantor and the
Trustee of any supplemental indenture pursuant to the provisions of Section 902,
the Company shall give notice thereof to the Holders of each Outstanding
Security affected, in the manner provided for in Section 106, setting forth in
general terms the substance of such supplemental indenture. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture.
ARTICLE TEN
COVENANTS
Section 1001. Payment of Principal, Premium and Interest.
The Company shall duly and punctually pay the principal of, premium,
if any, and interest on the Securities in accordance with the terms of the
Securities and this Indenture.
Section 1002. Maintenance of Office or Agency.
The Company shall maintain an office or agency where Securities may
be represented or surrendered for payment. The Company also will maintain in The
City of New York an office or agency where Securities may be surrendered for
registration of transfer, redemption or exchange and where notices and demands
to or upon the Company in respect of the Securities and this Indenture may be
served. The Corporate Trust Office will be such office or agency of the Company,
unless the Company shall designate and maintain some other office or agency for
one or more of such purposes. The Company will give prompt written notice to the
Trustee of the location and any change in the location of any such offices or
agencies. If at any time the Company shall fail to maintain any such required
offices or agencies or shall fail to furnish the Trustee with the address
thereof, such presentations, surrenders, notices and demands may be made or
served at the office of the Trustee and the Company hereby appoints the Trustee
such agent as its agent to receive all such presentations, surrenders, notices
and demands.
The Company may from time to time designate one or more other
offices or agencies (in or outside of The City of New York) where the Securities
may be presented or surrendered for any or all such purposes, and may from time
to time rescind such designation. The Company will give prompt written notice to
the Trustee of any such designation or rescission and any change in the location
of any such office or agency.
The Trustee shall initially act as Paying Agent for the Securities.
Section 1003. Money for Security Payments to be Held in Trust.
If the Company or any of its Affiliates shall at any time act as
Paying Agent, it will, on or before each due date of the principal of, premium,
if any, or interest on any of the Securities, segregate and hold in trust for
the benefit of the Holders entitled thereto a sum sufficient to pay the
principal, premium, if any, or interest so becoming due until such sums shall be
paid to such Persons or otherwise disposed of as herein provided, and will
promptly notify the Trustee of its action or failure so to act.
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If the Company or any of its Affiliates is not acting as Paying
Agent, the Company will, on or before each due date of the principal of,
premium, if any, or interest on any of the Securities, deposit with a Paying
Agent a sum in same day funds sufficient to pay the principal, premium, if any,
or interest so becoming due, such sum to be held in trust for the benefit of the
Persons entitled to such principal, premium or interest, and (unless such Paying
Agent is the Trustee) the Company will promptly notify the Trustee of such
action or any failure so to act.
If the Company is not acting as Paying Agent, the Company will cause
each Paying Agent other than the Trustee to execute and deliver to the Trustee
an instrument in which such Paying Agent shall agree with the Trustee, subject
to the provisions of this Section, that such Paying Agent will:
(a) hold all sums held by it for the payment of the principal of,
premium, if any, or interest on the Securities in trust for the benefit of
the Persons entitled thereto until such sums shall be paid to such Persons
or otherwise disposed of as herein provided;
(b) give the Trustee notice of any Default by the Company or any
Guarantor (or any other obligor upon the Securities) in the making of any
payment of principal, premium, if any, or interest on the Securities;
(c) at any time during the continuance of any such Default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent; and
(d) acknowledge, accept and agree to comply in all aspects with the
provisions of this Indenture relating to the duties, rights and
disabilities of such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of, premium, if
any, or interest on any Security and remaining unclaimed for two years after
such principal and premium, if any, or interest has become due and payable shall
promptly be paid to the Company on Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Security
shall thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in the New York Times and The
Wall Street Journal (national edition), and mail to each such Holder, notice
that such money remains unclaimed and that, after a date specified therein,
which shall not be less than 30 days from the date of such notification,
publication and mailing, any unclaimed balance of such money then remaining will
promptly be repaid to the Company.
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Section 1004. Corporate Existence.
Subject to Article Eight, the Company shall do or cause to be done
all things necessary to preserve and keep in full force and effect the corporate
existence and related rights and franchises (charter and statutory) of the
Company and each Subsidiary; provided, however, that the Company shall not be
required to preserve any such right or franchise or the corporate existence of
any such Subsidiary if the Board of Directors of the Company shall determine
that the preservation thereof is no longer necessary or desirable in the conduct
of the business of the Company and its Subsidiaries as a whole; provided,
further, however, that the foregoing shall not prohibit a sale, transfer or
conveyance of a Subsidiary or any of the assets of the Company or any Subsidiary
in compliance with the terms of this Indenture.
Section 1005. Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or
discharged, on or before the date the same shall become due and payable, (a) all
taxes, assessments and governmental charges levied or imposed upon the Company
or any of its Subsidiaries shown to be due on any return of the Company or any
of its Subsidiaries or otherwise assessed or upon the income, profits or
property of the Company or any of its Subsidiaries if failure to pay or
discharge the same could reasonably be expected to have a material adverse
effect on the ability of the Company or any Guarantor to perform its obligations
hereunder and (b) all lawful claims for labor, materials and supplies, which, if
unpaid, would by law become a Lien upon the property of the Company or any of
its Subsidiaries, except for any Lien permitted to be incurred under Section
1011, if failure to pay or discharge the same could reasonably be expected to
have a material adverse effect on the ability of the Company or any Guarantor to
perform its obligations hereunder; provided, however, that the Company shall not
be required to pay or discharge or cause to be paid or discharged any such tax,
assessment, charge or claim whose amount, applicability or validity is being
contested in good faith by appropriate proceedings properly instituted and
diligently conducted and in respect of which appropriate reserves (in the good
faith judgment of management of the Company) are being maintained in accordance
with GAAP.
Section 1006. Maintenance of Properties.
The Company shall cause all material properties owned by the Company
or any of its Subsidiaries or used or held for use in the conduct of its
business or the business of any of its Subsidiaries to be maintained and kept in
good condition, repair and working order (ordinary wear and tear excepted) and
supplied with all necessary equipment and will cause to be made all necessary
repairs, renewals, replacements, betterments and improvements thereof, all as in
the reasonable judgment of the Company may be consistent with sound business
practice and necessary so that the business carried on in connection therewith
may be properly conducted at all times; provided, however, that nothing in this
Section shall prevent the Company from discontinuing the maintenance of any of
such properties if such discontinuance is, in the reasonable judgment of the
Company, desirable in the conduct of its business or the business of any of its
Subsidiaries; provided, further, however, that the foregoing shall not prohibit
a sale, transfer or conveyance of a Subsidiary or any of its properties or
assets in compliance with the terms of this Indenture.
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Section 1007. Maintenance of Insurance.
The Company shall at all times keep all of its and its Subsidiaries'
properties which are of an insurable nature insured with insurers, believed by
the Company in good faith to be financially sound and responsible, against loss
or damage to the extent that property of similar character is usually so insured
by corporations similarly situated and owning like properties in the same
general geographic areas in which the Company and its Subsidiaries operate,
except where the failure to do so could not reasonably be expected to have a
material adverse effect on the condition (financial or otherwise), earnings,
business affairs or prospects of the Company and its Subsidiaries, taken as a
whole.
Section 1008. Limitation on Indebtedness.
(a) The Company shall not, and shall not cause or permit any
Subsidiary to, directly or indirectly, Incur any Indebtedness (other than
the Securities); provided, however, that the Company may Incur
Indebtedness, and the Company or any Subsidiary may Incur Acquired
Indebtedness, if, at the time of such Incurrence, the Debt to Annualized
Operating Cash Flow Ratio would be less than or equal to 5.5 to 1.0 on or
prior to December 31, 2000, or less than or equal to 5.0 to 1.0 after
December 31, 2000, in each case as determined on a pro forma basis
(including a pro forma application of net proceeds therefrom) as if such
additional Indebtedness had been Incurred at the beginning of the
applicable Measurement Period.
(b) The foregoing limitations of paragraph (a) of this covenant will
not apply to any of the following, each of which shall be given
independent effect:
(i) the Incurrence by the Company or any of its Subsidiaries
of Indebtedness (other than Acquired Indebtedness) consisting of
Capital Lease Obligations, Purchase Money Obligations, mortgage
financings or other obligations incurred for the purpose of
financing all or any part of the purchase price, cost of
construction or improvement of inventory, property, plant or
equipment used or sold in connection with the Internet Service
Business or a credit facility or a master lease arrangement entered
into for the purpose of providing such financing, provided that such
Indebtedness does not exceed the lesser of Fair Market Value or the
purchase price of such inventory, property, plant or equipment at
the time of such Incurrence;
(ii) the Incurrence of Indebtedness of the Company or any of
its Subsidiaries, and any renewals, extensions, substitutions,
refinancings or replacements of such Indebtedness, so long as the
aggregate principal amount of such Indebtedness shall not exceed $35
million outstanding at any one time in the aggregate;
(iii) the Incurrence by the Company of Indebtedness (other than
secured Acquired Indebtedness) in an aggregate principal amount not
to exceed 2.0 times the sum of the Net Cash Proceeds received by the
Company after the date of this Indenture (other than from the
issuance of Disqualified Stock) in connection with any Public Equity
Offerings; provided that such Indebtedness does not mature prior to
the Stated Maturity of the Securities or has an Average Life to
Stated Maturity at least equal to the Securities;
(iv) Indebtedness of the Company or any Subsidiary Incurred in
the ordinary course of business (a) pursuant to Interest Rate
Agreements designed to protect
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the Company or any Subsidiary against fluctuations in interest rates
in respect of Indebtedness of the Company or any Subsidiary as long
as the notional principal amount of such Interest Rate Agreements do
not exceed the aggregate principal amount of such Indebtedness then
outstanding, (b) under any Currency Hedging Arrangements designed to
protect the Company or any Subsidiary against fluctuations in the
value of any currency or (c) under any Commodity Price Protection
Agreements designed to protect the Company or any Subsidiary against
fluctuations in the price of any commodity;
(v) the Incurrence by the Company or any of its Subsidiaries
of Indebtedness in respect of bid, performance or advance payment
bonds and appeal or surety bonds;
(vi) Indebtedness existing on the date of this Indenture;
(vii) the Incurrence of (a) Indebtedness of any Subsidiary
owed to and held by the Company or another Subsidiary and (b)
Indebtedness of the Company owed to and held by any Subsidiary; and
(viii) any renewals, extensions, substitutions, refundings,
refinancings or replacements (collectively, a "refinancing") of any
Indebtedness described in clauses (i), (ii), (iii), (vi) and (vii)
of this Section 1008(b), including any successive refinancings so
long as the borrower under such refinancing is the Company or, if
not the Company, the same as the borrower of the Indebtedness being
refinanced and the aggregate principal amount of Indebtedness
represented thereby is not increased by such refinancing plus the
lesser of (I) the stated amount of any premium or other payment
required to be paid in connection with such a refinancing pursuant
to the terms of the Indebtedness being refinanced or (II) the amount
of premium or other payment actually paid at such time to refinance
the Indebtedness, plus, in either case, the amount of expenses of
the Company incurred in connection with such refinancing and, in the
case of any refinancing of Indebtedness that is Subordinated
Indebtedness, such new Indebtedness is made subordinated to the
Securities at least to the same extent as the Indebtedness being
refinanced and such refinancing does not reduce the Average Life to
Stated Maturity or the Stated Maturity of such Subordinated
Indebtedness.
(c) For purposes of determining any particular amount of
Indebtedness under this covenant, Guarantees, Liens or obligations with
respect to letters of credit supporting Indebtedness otherwise included in
the determination of such particular amount shall not be included;
provided, however, that the foregoing shall not in any way be deemed to
limit the provisions of Section 1013.
(d) For purposes of determining compliance with this Section 1008,
in the event that an item of Indebtedness may be Incurred pursuant to
paragraph (a) of this Section 1008 or by meeting the criteria of one or
more of the types of Indebtedness described in paragraph (b) of this
Section 1008 (or the definitions of the terms used therein), the Company,
in its sole discretion, (i) may classify such item of Indebtedness under
and comply with either of such paragraphs (or any of such definitions), as
applicable, (ii) may classify and divide such item of Indebtedness into
more than one of such paragraphs (or definitions), as applicable, and
(iii) may elect to comply with such paragraphs (or definitions), as
applicable, in any order.
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Section 1009. Limitation on Restricted Payments.
(a) The Company will not, and will not permit any Subsidiary to,
directly or indirectly:
(i) declare or pay any dividend on, or make any distribution
(including, without limitation, any liquidation preference) on any
shares of the Company's Capital Stock (other than dividends or
distributions payable solely in shares of its Qualified Capital
Stock or in options, warrants or other rights to acquire shares of
such Qualified Capital Stock);
(ii) purchase, redeem, defease or otherwise acquire or retire
for value, directly or indirectly, its Capital Stock or any Capital
Stock of any Affiliate of the Company (other than any such Capital
Stock owned by the Company or a Wholly Owned Subsidiary of the
Company) or options, warrants or other rights to acquire such
Capital Stock;
(iii) make any principal payment on, or repurchase, redeem,
defease, retire or otherwise acquire for value, prior to any
scheduled principal payment, sinking fund payment or maturity, any
Subordinated Indebtedness;
(iv) declare or pay any dividend or distribution (including,
without limitation, any liquidation preference) on any Capital Stock
of any Subsidiary to any Person (other than (a) to the Company or
any of its Wholly Owned Subsidiaries or (b) to all holders of
Capital Stock of such Subsidiary on a pro rata basis); or
(v) make any Investment in any Person (other than any
Permitted Investments)
(any of the foregoing actions described in clauses (i) through (v), other
than any such action that is a Permitted Payment (as defined below),
collectively, "Restricted Payments") (the amount of any such Restricted
Payment, if other than cash, as determined by the Board of Directors of
the Company, whose determination shall be conclusive and evidenced by a
Board Resolution), unless (1) immediately before and immediately after
giving effect to such proposed Restricted Payment on a pro forma basis, no
Default or Event of Default shall have occurred and be continuing; (2)
immediately before and immediately after giving effect to such Restricted
Payment on a pro forma basis, the Company could incur $1.00 of additional
Indebtedness under the provisions contained in Section 1008(a); and (3)
after giving effect to the proposed Restricted Payment, the aggregate
amount of all such Restricted Payments declared or made after the date of
the date hereof, does not exceed the sum of the following (the "Basket"):
(A) (i) the Cumulative Operating Cash Flow determined at
the time of such Restricted Payment less (ii) 150% of
cumulative Consolidated Interest Expense determined for the
period (treated as one accounting period) commencing on the
date of the original issue of the Securities and ending on the
last day of the most recent fiscal quarter immediately
preceding the date of such Restricted Payment for which
consolidated financial information of the Company is required
to be available;
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(B) (i) capital contributions to the Company after the
date of this Indenture or (ii) the aggregate Net Cash Proceeds
received after the date of this Indenture by the Company from
the issuance or sale (other than to any of its Subsidiaries)
of Qualified Capital Stock of the Company or any options,
warrants or rights to purchase such Qualified Capital Stock of
the Company (except, in each case, to the extent such proceeds
are used to purchase, redeem or otherwise retire Capital Stock
or Subordinated Indebtedness as set forth below in clause (ii)
or (iii) of paragraph (b) below);
(C) the aggregate Net Cash Proceeds received after the
date of this Indenture by the Company (other than from any of
its Subsidiaries) upon the exercise of any options, warrants
or rights to purchase Qualified Capital Stock of the Company;
(D) the aggregate Net Cash Proceeds received after the
date of this Indenture by the Company from the conversion or
exchange, if any, of debt securities or Redeemable Capital
Stock of the Company or its Subsidiaries into or for Qualified
Capital Stock of the Company plus, to the extent such debt
securities or Redeemable Capital Stock were issued after the
date of this Indenture, the aggregate of Net Cash Proceeds
from their original issuance; and
(E) in the case of the disposition or repayment of any
Investment constituting a Restricted Payment, an amount equal
to the return of capital with respect to such Investment and
the initial amount of such Investment.
(b) Notwithstanding the foregoing, and in the case of clauses (ii)
through (vi) below, so long as no Default or Event of Default shall have
occurred and be continuing, the foregoing provisions of this covenant
shall not prohibit the following actions (each of clauses (i) through
(vii) below being referred to as a "Permitted Payment"):
(i) the payment of any dividend within 60 days after the date
of declaration thereof, if at such date of declaration such payment
was permitted by the provisions of paragraph (a) of this Section
1009 and such payment shall have been deemed to have been paid on
such date of declaration and shall not have been deemed a Permitted
Payment for purposes of the calculation required by paragraph (a) of
this Section 1009;
(ii) the repurchase, redemption, or other acquisition or
retirement for value of any shares of any class of Capital Stock of
the Company in exchange for (including any such exchange pursuant to
the exercise of a conversion right or privilege in connection with
which cash is paid in lieu of the issuance of fractional shares or
scrip), or out of the Net Cash Proceeds of a substantially
concurrent issuance and sale for cash (other than to a Subsidiary)
of, other shares of Qualified Capital Stock of the Company; provided
that the Net Cash Proceeds from the issuance of such shares of
Qualified Capital Stock are excluded from clause (v) (3)(B) of
paragraph (a) of this Section 1009;
(iii) the repurchase, redemption, defeasance, retirement or
acquisition for value or payment of principal of any Subordinated
Indebtedness or Redeemable Capital Stock in exchange for, or in an
amount not in excess of the Net Cash Proceeds of, a
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substantially concurrent issuance and sale for cash (other than to
any Subsidiary of the Company) of any Qualified Capital Stock of the
Company, provided that the Net Cash Proceeds from the issuance of
such shares of Qualified Capital Stock are excluded from clause (v)
(3)(B) of paragraph (a) of this Section 1009;
(iv) the repurchase, redemption, defeasance, retirement,
refinancing, acquisition for value or payment of principal of any
Subordinated Indebtedness (other than Redeemable Capital Stock) (a
"refinancing") through the substantially concurrent issuance of new
Subordinated Indebtedness of the Company, provided that any such new
Subordinated Indebtedness (1) shall be in a principal amount that
does not exceed the principal amount so refinanced (or, if such
Subordinated Indebtedness provides for an amount less than the
principal amount thereof to be due and payable upon a declaration of
acceleration thereof, then such lesser amount as of the date of
determination), plus the lesser of (I) the stated amount of any
premium or other payment required to be paid in connection with such
a refinancing pursuant to the terms of the Indebtedness being
refinanced or (II) the amount of premium or other payment actually
paid at such time to refinance the Indebtedness, plus, in either
case, the amount of expenses of the Company incurred in connection
with such refinancing; (2) has an Average Life to Stated Maturity
greater than the remaining Average Life to Stated Maturity of the
Securities; (3) has a Stated Maturity for its final scheduled
principal payment later than the Stated Maturity for the final
scheduled principal payment of the Securities; and (4) is expressly
subordinated in right of payment to the Securities at least to the
same extent as the Subordinated Indebtedness to be refinanced;
(v) the repurchase, redemption, defeasance, retirement,
refinancing, acquisition for value or payment of any Redeemable
Capital Stock through the substantially concurrent issuance of new
Redeemable Capital Stock of the Company, provided that any such new
Redeemable Capital Stock (1) shall have an aggregate liquidation
preference that does not exceed the aggregate liquidation preference
of the amount so refinanced; (2) has an Average Life to Stated
Maturity greater than the remaining Average Life to Stated Maturity
of the Securities; and (3) has a Stated Maturity later than the
Stated Maturity for the final scheduled principal payment of the
Securities;
(vi) the repurchase of shares of, or options to purchase
shares of, common stock of the Company or any of its Subsidiaries
from employees, former employees, directors or former directors of
the Company or any of its Subsidiaries (or permitted transferees of
such employees, former employees, directors or former directors),
pursuant to the terms of the agreements (including employment
agreements) or plans (or amendments thereto) approved by the Board
of Directors under which such individuals purchase or sell or are
granted the option to purchase or sell, shares of such common stock;
provided, however, that the aggregate amount of such repurchases in
any calendar year shall not exceed $500,000 individually and $2.5
million in the aggregate; and
(vii) the repurchase or redemption of warrants to purchase
shares of Common Stock issued in connection with the Company's
initial public offering that are outstanding prior to the Issue Date
of the Securities in an amount which shall not exceed $100,000 in
the aggregate and the repurchase of Common Stock of the Company,
through open market purchases, in an aggregate amount not to exceed
$1,000,000.
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Section 1010. Limitation on Transactions with Affiliates.
The Company will not, and will not permit or cause any of its
Subsidiaries to, directly or indirectly, enter into any transaction or series of
related transactions (including, without limitation, the sale, purchase,
exchange or lease of assets, property or services) with or for the benefit of
any Affiliate of the Company unless such transaction or series of related
transactions is entered into in good faith and in writing and (a) such
transaction or series of related transactions is on terms that are no less
favorable to the Company or such Subsidiary, as the case may be, than those that
would be reasonably expected to be available in a comparable transaction in
arm's-length dealings with an unrelated third party, (b) such transaction or
series of related transactions has been approved by a majority of the
Disinterested Directors of the Company, or in the event there is only one
Disinterested Director, by such Disinterested Director, (c) with respect to any
such transaction or series of related transactions involving aggregate value in
excess of $1 million, the Company delivers an Officers' Certificate to the
Trustee certifying that such transaction or series of related transactions
complies with clauses (a) and (b) above, and (d) with respect to any transaction
or series of related transactions involving aggregate value in excess of $2.5
million, such transaction or series of related transactions has been approved by
a majority of the Disinterested Directors of the Company, or in the event there
is only one Disinterested Director, by such Disinterested Director, and the
Company delivers to the Trustee a written opinion of an investment banking firm
of national standing or other recognized independent expert with experience
appraising the terms and conditions of the type of transaction or series of
related transactions for which an opinion is required stating that the
transactions or series of related transactions is fair to the Company or such
Subsidiary from a financial point of view; provided, however, that this
provision shall not apply to: (a) compensation and employee benefit arrangements
with any officer, director or employee of the Company, including under any stock
option or stock incentive plans, in the ordinary course of business; (b) any
transaction solely between or among the Company and/or any Subsidiaries, if such
transaction is otherwise in compliance with this Indenture and is on fair and
reasonable terms; (c) any transaction otherwise permitted by Section 1009; (d)
the execution and delivery of or payments made under any tax sharing agreement
between or among any of the Company and any Subsidiary; (e) licensing or
sublicensing of use of any intellectual property by the Company or any
Subsidiary to any Subsidiary of the Company; provided that the licensor shall
continue to have access to such intellectual property to the extent necessary
for the conduct of its respective business; (f) arrangements between the Company
and any Subsidiary for the purpose of providing services or employees to such
Subsidiary; (g) any transaction entered into for the purpose of granting or
altering registration rights with respect to the Capital Stock of the Company;
and (h) any transaction or series of related transactions entered into prior to
the date hereof.
Section 1011. Limitation on Liens.
The Company will not, and will not permit any Subsidiary to,
directly or indirectly, create, incur, affirm, assume or suffer to exist any
Lien of any kind against or upon any property or assets (including any
intercompany notes) of the Company or any Subsidiary owned on the date hereof
(other than the Escrow Account), or acquired after the date hereof, or any
income or profits therefrom, unless the Securities are directly secured equally
and ratably with (or, in the case of Subordinated Indebtedness, prior or senior
thereto, with the same relative priority as the Securities shall have with
respect to such Subordinated Indebtedness) the obligation or liability secured
by such Lien except for any Permitted Liens.
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Section 1012. Limitation on Sale of Assets.
(a) The Company will not, and will not permit any of its
Subsidiaries to, directly or indirectly, whether in a single transaction
or a series of related transactions, consummate an Asset Sale unless (i)
no Default or Event of Default has occurred or would occur as a result
thereof, (ii) at least 75% of the consideration from such Asset Sale is
received in cash or other comparable consideration (as described below),
and (iii) the Company or such Subsidiary receives consideration at the
time of such Asset Sale at least equal to the Fair Market Value of the
shares or assets subject to such Asset Sale (as determined by the Board of
Directors of the Company and evidenced in a Board Resolution delivered to
the Trustee). The following types of consideration shall be deemed
"comparable consideration" for the purposes of this Section 1012: (A) Cash
Equivalents, (B) liabilities (contingent or otherwise) of the Company or a
Subsidiary assumed by the transferee (or its designee) such that the
Company or such Subsidiary has no further liability therefor, and (C) any
securities, notes or other obligations received by the Company or any such
Subsidiary from such transferee that are immediately converted by the
Company or such Subsidiary into cash.
(b) The Company or a Subsidiary may, within 365 days of the Asset
Sale invest the Net Cash Proceeds in properties and other assets that will
be used in the Internet Service Businesses or to permanently repay any
Pari Passu Indebtedness of the Company or any Subsidiary (including the
repurchase of the Securities). The amount of such Net Cash Proceeds not
used or invested within 365 days of the Asset Sale as set forth in this
paragraph (b) constitutes "Excess Proceeds."
(c) When the aggregate amount of Excess Proceeds equals or exceeds
$5 million, the Company will apply the Excess Proceeds to the repayment of
the Securities and any other Pari Passu Indebtedness of the Company
outstanding with similar provisions requiring the Company to make an offer
to purchase such Indebtedness with the proceeds from any Asset Sale as
follows: (A) the Company will make an offer to purchase (an "Offer") from
all holders of the Securities in accordance with the procedures set forth
in the Indenture in the maximum principal amount (expressed as a multiple
of $1,000) of Securities that may be purchased out of an amount (the
"Security Amount") equal to the product of such Excess Proceeds multiplied
by a fraction, the numerator of which is the outstanding principal amount
of the Securities, and the denominator of which is the sum of the
outstanding principal amount of the Securities and such Pari Passu
Indebtedness (subject to proration in the event such amount is less than
the aggregate Offered Price (as defined herein) of all Securities
tendered) and (B) to the extent required by such Pari Passu Indebtedness
to permanently reduce the principal amount of such Pari Passu
Indebtedness, the Company will make an offer to purchase or otherwise
repurchase or redeem Pari Passu Indebtedness (a "Pari Passu Offer") in an
amount (the "Pari Passu Debt Amount") equal to the excess of the Excess
Proceeds over the Security Amount; provided that in no event will the
Company be required to make a Pari Passu Offer in a Pari Passu Debt Amount
exceeding the principal amount of such Pari Passu Indebtedness plus the
amount of any premium required to be paid to repurchase such Pari Passu
Indebtedness. The offer price for the Securities will be payable in cash
in an amount equal to 100% of the principal amount of the Securities plus
accrued and unpaid interest, if any, to the date (the "Offer Date") such
Offer is consummated (the "Offered Price"), in accordance with the
procedures set forth herein. To the extent that the aggregate Offered
Price of the Securities tendered pursuant to the Offer is less than the
Security Amount relating thereto or the aggregate amount of Pari Passu
Indebtedness that is purchased in a Pari Passu Offer is less than the Pari
Passu Debt Amount, the Company will use any remaining Excess Proceeds for
general corporate purposes. If the aggregate principal amount of
Securities and Pari
86
Passu Indebtedness surrendered by holders thereof exceeds the amount of
Excess Proceeds, the Trustee shall select the Securities to be purchased
on a pro rata basis. Upon the completion of the purchase of all the
Securities tendered pursuant to an Offer and the completion of a Pari
Passu Offer, the amount of Excess Proceeds, if any, shall be reset at
zero.
(d) If the Company becomes obligated to make an Offer pursuant to
paragraph (c) immediately above, the Securities and the Pari Passu
Indebtedness shall be purchased by the Company, at the option of the
holders thereof, in whole or in part in integral multiples of $1,000, on a
date that is not earlier than 30 days and not later than 60 days from the
date the notice of the Offer is given to holders, or such later date as
may be necessary for the Company to comply with the requirements under the
Exchange Act.
(e) The Company will comply with the applicable tender offer rules,
including Rule 14e-1 under the Exchange Act, and any other applicable
securities laws or regulations in connection with an Offer.
Section 1013. Limitation on Issuances of Guarantees of Indebtedness.
(a) The Company will not permit any Subsidiary, directly or
indirectly, to guarantee, assume or in any other manner become liable with
respect to any Pari Passu Indebtedness or Subordinated Indebtedness of the
Company unless such Subsidiary simultaneously executes and delivers a
supplemental indenture to this Indenture providing for a Guarantee of the
Securities on the same terms as the guarantee of such Indebtedness except
that (A) such guarantee need not be secured unless required pursuant to
Section 1011 and (B) if such Indebtedness is by its terms expressly
subordinated to the Securities, any such assumption, guarantee or other
liability of such Subsidiary with respect to such Indebtedness shall be
subordinated to such Subsidiary's Guarantee of the Securities at least to
the same extent as such Indebtedness is subordinated to the Securities;
provided that this paragraph shall not apply to any guarantee or
assumption of liability of Indebtedness permitted under clauses (i), (ii),
(iv), (v), (vii) and (viii) of paragraph (b) of Section 1008.
(b) Notwithstanding the foregoing paragraph (a) of this covenant,
any Guarantee by a Subsidiary of the Securities shall provide by its terms
that it (and all Liens securing the same) shall be automatically and
unconditionally released and discharged upon any sale, exchange or
transfer, to any Person not an Affiliate of the Company, of all of the
Company's Capital Stock in, or all or substantially all the assets of,
such Subsidiary, which transaction is in compliance with the terms of this
Indenture and pursuant to which transaction such Subsidiary is released
from all guarantees, if any, by it of other Indebtedness of the Company or
any Subsidiaries.
Section 1014. Purchase of Securities upon a Change of Control.
(a) If a Change of Control shall occur at any time, then each Holder
shall have the right to require that the Company purchase such Holder's
Securities in whole or in part in integral multiples of $1,000, at a
purchase price (the "Change of Control Purchase Price") in cash, in an
amount equal to 101% of the principal amount of such Securities or portion
thereof, plus accrued and unpaid interest, if any, to the date of purchase
(the "Change of Control Purchase Date"), pursuant to the offer described
below in this Section 1014 (the "Change of Control Offer") and in
accordance with the other procedures set forth in paragraphs (b), (c), (d)
and (e) of this Section 1014.
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(b) Within 30 days of any Change of Control, the Company shall
notify the Trustee thereof and give written notice (a "Change of Control
Purchase Notice") of such Change of Control to each Holder by first-class
mail, postage prepaid, at his address appearing in the Security Register,
stating among other things:
(1) that a Change of Control has occurred, the date of such
event, and that such Holder has the right to require the Company to
repurchase such Holder's Securities at the Change of Control
Purchase Price;
(2) the circumstances and relevant facts regarding such Change
of Control;
(3) that the Change of Control Offer is being made pursuant to
this Section 1014 and that all Securities properly tendered pursuant
to the Change of Control Offer will be accepted for payment at the
Change of Control Purchase Price;
(4) the Change of Control Purchase Date, which shall be a
Business Day no earlier than 30 days and not later than 60 days from
the date such notice is mailed, or such later date as may be
necessary to comply with any applicable requirements under the
Exchange Act;
(5) the Change of Control Purchase Price;
(6) the names and addresses of the Paying Agent and the
offices or agencies referred to in Section 1002;
(7) that Securities must be surrendered on or prior to the
Change of Control Purchase Date to the Paying Agent at the office of
the Paying Agent or to an office or agency referred to in Section
1002 to collect payment;
(8) that the Change of Control Purchase Price for any Security
which has been properly tendered and not withdrawn will be paid
promptly following the Change of Control Offer Purchase Date;
(9) the procedures that a Holder must follow to accept a
Change of Control Offer or to withdraw such acceptance;
(10) that any Security not tendered will continue to accrue
interest; and
(11) that, unless the Company defaults in the payment of the
Change of Control Purchase Price, any Securities accepted for
payment pursuant to the Change of Control Offer shall cease to
accrue interest after the Change of Control Purchase Date.
(c) Upon receipt by the Company of the proper tender of Securities,
the Holder of the Security in respect of which such proper tender was made
shall (unless the tender of such Security is properly withdrawn)
thereafter be entitled to receive solely the Change of Control Purchase
Price with respect to such Security. Upon surrender of any such Security
for purchase in accordance with the foregoing provisions, such Security
shall be paid by the Company at the Change of Control Purchase Price;
provided, however, that installments of interest whose Stated
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Maturity is on or prior to the Change of Control Purchase Date shall be
payable to the Holders of such Securities, or one or more Predecessor
Securities, registered as such on the relevant Regular Record Dates
according to the terms and the provisions of Section 309. If any Security
tendered for purchase in accordance with the provisions of this Section
1014 shall not be so paid upon surrender thereof, the principal thereof
(and premium, if any, thereon) shall, until paid, bear interest from the
Change of Control Purchase Date at the rate borne by such Security.
Holders electing to have Securities purchased will be required to
surrender such Securities to the Paying Agent at the address specified in
the Change of Control Purchase Notice prior to 5:00 p.m. (New York time)
at least one Business Day prior to the Change of Control Purchase Date.
Any Security that is to be purchased only in part shall be surrendered to
a Paying Agent at the office of such Paying Agent (with, if the Company,
the Security Registrar or the Trustee so requires, due endorsement by, or
a written instrument of transfer in form satisfactory to the Company and
the Security Registrar or the Trustee, as the case may be, duly executed
by, the Holder thereof or such Holder's attorney duly authorized in
writing), and the Company shall execute and the Trustee shall authenticate
and deliver to the Holder of such Security, without service charge to the
Holder, one or more new Securities of any authorized denomination as
requested by such Holder in an aggregate principal amount equal to, and in
exchange for, the portion of the principal amount of the Security so
surrendered that is not purchased.
(d) The Company shall (i) not later than the Change of Control
Purchase Date, accept for payment Securities or portions thereof tendered
pursuant to the Change of Control Offer, (ii) not later than 10:00 a.m.
(New York time) on the Change of Control Purchase Date, deposit with the
Trustee or with a Paying Agent an amount of money in same day funds (or
New York Clearing House funds if such deposit is made prior to the Change
of Control Purchase Date) sufficient to pay the aggregate Change of
Control Purchase Price of all the Securities or portions thereof which are
to be purchased as of the Change of Control Purchase Date and (iii) not
later than 10:00 a.m. (New York time) on the Change of Control Purchase
Date, deliver to the Paying Agent an Officers' Certificate stating the
aggregate principal amount of Securities or portions thereof being
purchased by the Company. The Paying Agent shall promptly mail or deliver
to Holders of Securities so accepted payment in an amount equal to the
Change of Control Purchase Price of the Securities purchased from each
such Holder, and the Company shall execute and the Trustee shall promptly
authenticate and mail or deliver to such Holders a new Security equal in
principal amount to any unpurchased portion of the Security surrendered.
Any Securities not so accepted shall be promptly mailed or delivered by
the Paying Agent at the Company's expense to the Holder thereof. The
Company will publicly announce the results of the Change of Control Offer
on the Change of Control Purchase Date. For purposes of this Section 1014,
the Company shall choose a Paying Agent which shall not be the Company.
(e) A tender made in response to a Change of Control Purchase Notice
may be withdrawn if the Company or its agent receives, not later than 5:00
p.m. (New York time) one Business Day prior to the Change of Control
Purchase Date, a signed letter, delivered to the address specified in the
change of Control Purchase Notice specifying, as applicable:
(1) the name of the Holder;
(2) the certificate number of the Security in respect of which
such notice of withdrawal is being submitted;
(3) the principal amount of the Security (which shall be
$1,000 or an integral
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multiple thereof) delivered for purchase by the Holder as to which
such notice of withdrawal is being submitted;
(4) a statement that such Holder is withdrawing his election
to have such principal amount of such Security purchased; and
(5) the principal amount, if any, of such Security (which
shall be $1,000 or an integral multiple thereof) that remains
subject to the original Change of Control Purchase Notice and that
has been or will be delivered for purchase by the Company.
(f) Subject to applicable escheat laws, the Trustee and the Paying
Agent shall return to the Company any cash that remains unclaimed,
together with interest or dividends, if any, thereon, held by them for the
payment of the Change of Control Purchase Price; provided, however, that,
(x) to the extent that the aggregate amount of cash deposited by the
Company pursuant to clause (ii) of paragraph (d) above exceeds the
aggregate Change of Control Purchase Price of the Securities or portions
thereof to be purchased, then the Trustee shall hold such excess for the
Company and (y) unless otherwise directed by the Company in writing,
promptly after the Business Day following the Change of Control Purchase
Date the Trustee shall return any such excess to the Company.
(g) The Company shall comply, to the extent applicable, with the
applicable tender offer rules, including Rule 14e-1 under the Exchange
Act, and any other applicable securities laws or regulations in connection
with a Change of Control Offer.
(h) Notwithstanding the foregoing, the Company will not be required
to make a Change of Control Offer if a third party makes the Change of
Control Offer, in the manner, at the times and otherwise in compliance
with the requirements set forth in this Indenture applicable to a Change
of Control Offer made by the Company and purchases all the Securities
validly tendered and not withdrawn under such Change of Control Offer.
Section 1015. Limitation on Sale and Leaseback Transactions.
The Company will not, and will not permit any Subsidiary of the
Company to, directly or indirectly, enter into, assume or otherwise become
liable with respect to any Sale and Leaseback Transaction with respect to any
property or assets (whether now owned or hereafter acquired), unless (i) the
sale or transfer of such property or assets to be leased is treated as an Asset
Sale and complies with the provisions of Section 1012, (ii) the Company or such
Subsidiary would be entitled under Section 1008 to incur any such Indebtedness
(with the lease obligations being treated as Indebtedness for purposes of
ascertaining compliance with this covenant unless such lease is properly
classified as an operating lease under GAAP) in respect of such Sale and
Leaseback Transaction and (iii) the consideration received by the Company or
such Subsidiary from such transaction is at least equal to the Fair Market Value
of the property being transferred.
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Section 1016. Limitation on Subsidiary Capital Stock.
The Company will not permit (a) any Subsidiary of the Company to
issue any Capital Stock, except for (i) Capital Stock issued or sold to, held by
or transferred to the Company or a Wholly Owned Subsidiary, and (ii) Capital
Stock issued by a Person prior to the time (A) such Person becomes a Subsidiary,
(B) such Person merges with or into a Subsidiary or (C) a Subsidiary merges with
or into such Person; provided that such Capital Stock was not issued or incurred
by such Person in anticipation of the type of transaction contemplated by
subclause (A), (B) or (C), or (b) any Person (other than the Company or a Wholly
Owned Subsidiary) to acquire Capital Stock of any Subsidiary from the Company or
any Subsidiary, except, in the case of clause (a) or (b), (1) upon the
acquisition of all the outstanding Capital Stock of such Subsidiary in
accordance with the terms hereof, (2) if, immediately after giving effect to
such issuance or sale, such Subsidiary would no longer constitute a Subsidiary,
and any Investment in such Person remaining after giving effect to such issuance
or sale would have been permitted to be made under the provisions contained in
Section 1009 if made on the date of such issuance or sale, (3) issuances of
director's qualifying shares, or sales to foreign nationals of shares of Capital
Stock of foreign Subsidiaries, to the extent required by applicable law, (4)
issuances or sales of common stock of a Subsidiary, provided that the Company or
such Subsidiary applies the Net Cash Proceeds, if any, in accordance with the
provisions of this Indenture to the extent applicable, (5) issuances after which
the Company maintains its direct or indirect percentage of beneficial and
economic ownership of such Subsidiary, or (6) issuances in connection with
Acquisitions for the primary purpose of minimizing tax liability to the Company,
any of its Subsidiaries, the Acquired Person or any shareholders of the Acquired
Person.
Section 1017. Limitation on Dividends and Other Payment Restrictions
Affecting Subsidiaries.
The Company will not, and will not permit any of its Subsidiaries
to, directly or indirectly, create or otherwise enter into or cause to become
effective any consensual encumbrance or restriction on the ability of any
Subsidiary to (i) pay dividends or make any other distribution on its Capital
Stock or with respect to any other interest or participation in, or measured by,
its profits, (ii) pay any Indebtedness owed to the Company or any other
Subsidiary, (iii) make any Investment in the Company or any other Subsidiary or
(iv) transfer any of its properties or assets to the Company or any other
Subsidiary, except for: (a) any encumbrance or restriction, with respect to a
Subsidiary that is not a Subsidiary of the Company on the date of this
Indenture, in existence at the time such Person becomes a Subsidiary of the
Company and not incurred in connection with, or in contemplation of, such Person
becoming a Subsidiary; (b) encumbrances or restrictions (I) by reason of
applicable law, or (II) under this Indenture; (c) customary non-assignment
provisions of any contract or lease entered into in the ordinary course of
business; (d) encumbrances or restrictions imposed pursuant to contracts entered
into in connection with Permitted Liens, but solely to the extent such
encumbrances or restrictions affect property or assets subject to such Permitted
Lien; (e) any encumbrance or restriction imposed pursuant to contracts for the
sale of assets with respect to the assets to be sold pursuant to such contract;
and (f) any encumbrance or restriction existing under any agreement that
extends, renews, refinances or replaces the agreements containing the
encumbrances or restrictions in the foregoing clauses (a) through (e), or in
this clause (f), provided that the terms and conditions of any such encumbrances
or restrictions are no more restrictive in any material respect than those under
or pursuant to the agreement evidencing the Indebtedness so extended, renewed,
refinanced or replaced.
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Section 1018. Limitations on Unrestricted Subsidiaries.
The Company will not make, and will not permit its Subsidiaries to
make, any Investment in, and will not designate any Subsidiaries as,
Unrestricted Subsidiaries if, at the time thereof, (a) a Default or Event of
Default shall have occurred and be continuing or would occur after giving effect
to such Investment or designation, (b) the aggregate amount of such Investments
would exceed the amount of Restricted Payments then permitted to be made
pursuant to Section 1009, (c) the Company or its Subsidiaries would be
prohibited under this Indenture from making such Investment or designation, or
(d) after giving effect to such Investment or designation, the Company would
exceed the pro forma amount of Indebtedness permitted pursuant to Section 1008.
Any Investments in Unrestricted Subsidiaries permitted to be made pursuant to
this covenant will be treated as a Restricted Payment in calculating the amount
of Restricted Payments made by the Company.
Section 1019. Provision of Financial Statements.
After the earlier to occur of the consummation of the Exchange Offer
or the effectiveness of a Registration Statement relating to the Securities and
the 120th calendar day following the date of original issue of the Securities,
whether or not the Company is subject to Section 13(a) or 15(d) of the Exchange
Act, the Company will, to the extent permitted under the Exchange Act, file with
the Commission the annual reports, quarterly reports and other documents which
the Company would have been required to file with the Commission pursuant to
Sections 13(a) or 15(d) if the Company were so subject, such documents to be
filed with the Commission on or prior to the date (the "Required Filing Date")
by which the Company would have been required so to file such documents if the
Company were so subject. The Company will also in any event (x) within 15 days
of each Required Filing Date (i) transmit by mail to all Holders, as their names
and addresses appear in the Security Register, without cost to such Holders and
(ii) file with the Trustee copies of the annual reports, quarterly reports and
other documents which the Company would have been required to file with the
Commission pursuant to Sections 13(a) or 15(d) of the Exchange Act if the
Company were subject to either of such Sections and (y) if filing such documents
by the Company with the Commission is not permitted under the Exchange Act,
promptly upon written request and payment of the reasonable cost of duplication
and delivery, supply copies of such documents to any prospective Holder at the
Company's cost. If any Guarantor's financial statements would be required to be
included in the financial statements filed or delivered pursuant to this
Indenture if the Company were subject to Section 13(a) or 15(d) of the Exchange
Act, the Company shall include such Guarantor's financial statements in any
filing or delivery pursuant to this Indenture. In addition, so long as any of
the Securities remain outstanding and the Company is not subject to Sections
13(a) or 15(d) of the Exchange Act, the Company will make available to any
prospective purchaser of Securities or beneficial owner of Securities in
connection with any sale thereof the information required by Rule 144A(d)(4)
under the Securities Act, until such time as the Company has either exchanged
the Securities for securities identical in all material respects which have been
registered under the Securities Act or until such time as the Holders thereof
have disposed of such Securities pursuant to an effective registration statement
under the Securities Act.
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Section 1020. Statement by Officers as to Default.
(a) The Company and each Guarantor, if any, will deliver to the
Trustee, on or before a date not more than 120 days after the end of each
fiscal year of the Company ending after the date hereof, and 60 days after
the end of each fiscal quarter ending after the date hereof, a written
statement signed by the principal executive officer, principal financial
officer or principal accounting officer of the Company in his/her capacity
as an officer of the Company, as to compliance herewith, including whether
or not, after a review of the activities of the Company during such year
and of the Company's and each Guarantor's performance under this
Indenture, to the best knowledge, based on such review, of the signers
thereof, the Company and each Guarantor have fulfilled all of their
respective obligations and are in compliance with all conditions and
covenants under this Indenture throughout such year and, if there has been
a Default specifying each Default and the nature and status thereof and
any actions being taken by the Company with respect thereto.
(b) When any Default or Event of Default has occurred and is
continuing, or if the Trustee or any Holder or the trustee for or the
holder of any other evidence of Indebtedness of the Company or any
Subsidiary gives any notice or takes any other action with respect to a
claimed default, the Company shall deliver to the Trustee by registered or
certified mail or facsimile transmission followed by an originally
executed copy of an Officers' Certificate specifying such Default, Event
of Default, notice or other action, the status thereof and what actions
the Company is taking or proposes to take with respect thereto, within
five Business Days after the occurrence of such Default or Event of
Default.
Section 1021. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any
covenant or condition set forth in Sections 1006 through 1011, 1012(a), 1013 and
1015 through 1020, if, before or after the time for such compliance, the Holders
of not less than a majority in aggregate principal amount of the Securities at
the time Outstanding shall, by Act of such Holders, waive such compliance in
such instance with such covenant or provision, but no such waiver shall extend
to or affect such covenant or condition except to the extent so expressly
waived, and, until such waiver shall become effective, the obligations of the
Company and the duties of the Trustee in respect of any such covenant or
condition shall remain in full force and effect.
Section 1022. Limitation on Business.
The Company will not, and will not permit any of the Subsidiaries
to, engage in a business which is not substantially an Internet Service
Business.
Section 1023. Deposit of Funds with Escrow Agent.
(a) On the Issue Date, the Company shall deposit with the Escrow
Agent funds that together with the proceeds from the investment thereof
will be sufficient to pay the first six scheduled interest payments on the
Securities (including any Additional Interest). All Collateral shall be
held in the Escrow Account until permitted to be disbursed pursuant to the
Escrow Agreement and then shall be disbursed strictly in accordance with
the terms thereof.
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(b) Pending release of the Escrow Funds as provided in the Escrow
Agreement, the Escrow Funds will be invested in U.S. Government Securities
as specifically directed in writing by the Company. Any interest or other
profit resulting from such investment will be deposited in the Escrow
Account.
(c) The Trustee is hereby authorized and directed to enter into the
Escrow Agreement and to perform its duties and obligations thereunder.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
Section 1101. Rights of Redemption.
(a) The Securities are subject to redemption at any time on or after
May 1, 2001, at the option of the Company, in whole or in part, subject to
the conditions, and at the Redemption Prices, specified in the form of
Security, together with accrued and unpaid interest, if any, to the
Redemption Date (subject to the right of Holders of record on relevant
Regular Record Dates and Special Record Dates to receive interest due on
relevant Interest Payment Dates and Special Payment Dates).
(b) In addition, at any time prior to May 1, 2000, the Company may,
at its option, use the net proceeds of one or more Public Equity Offering
or the sale of Common Stock (other than Disqualified Stock) of the Company
to a Strategic Investor in a single transaction or in a series of related
transactions, to redeem up to an aggregate of 35% of the aggregate
principal amount of Securities originally issued under this Indenture at a
redemption price equal to 113% of the principal amount thereof, plus
accrued and unpaid interest thereon, if any, to the Redemption Date;
provided that at least 65% aggregate principal amount of Securities
remains outstanding immediately after the occurrence of such redemption.
In order to effect the foregoing redemption, the Company must mail a
notice of redemption no later than 45 days after the closing of the
related Public Equity Offering and must consummate such redemption within
60 days of the closing of the Public Equity Offering.
Section 1102. Applicability of Article.
Redemption of Securities at the election of the Company or
otherwise, as permitted or required by any provision of this Indenture, shall be
made in accordance with such provision and this Article Eleven.
Section 1103. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities pursuant to
Section 1101 shall be evidenced by a Company Order and an Officers' Certificate.
In case of any redemption at the election of the Company, the Company shall, not
less than 45 and not more than 60 days prior to the Redemption Date fixed by the
Company (unless a shorter notice period shall be satisfactory to the Trustee),
notify the Trustee in writing of such Redemption Date and of the principal
amount of Securities to be redeemed.
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Section 1104. Selection by Trustee of Securities to be Redeemed.
If less than all the Securities are to be redeemed, the particular
Securities or portions thereof to be redeemed shall be selected not more than 30
days prior to the Redemption Date. The Trustee shall select the Securities or
portions thereof to be redeemed pro rata, by lot or by any other method the
Trustee shall deem fair and reasonable. The amounts to be redeemed shall be
equal to $1,000 or any integral multiple thereof.
The Trustee shall promptly notify the Company and the Security
Registrar in writing of the Securities selected for redemption and, in the case
of any Securities selected for partial redemption, the principal amount thereof
to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to redemption of Securities shall relate, in
the case of any Security redeemed or to be redeemed only in part, to the portion
of the principal amount of such Security which has been or is to be redeemed.
Section 1105. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 days nor more than 60 days prior to the
Redemption Date, to each Holder of Securities to be redeemed, at its address
appearing in the Security Register.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if less than all Outstanding Securities are to be redeemed, the
identification of the particular Securities to be redeemed;
(d) in the case of a Security to be redeemed in part, the principal
amount of such Security to be redeemed and that after the Redemption Date
upon surrender of such Security, new Security or Securities in the
aggregate principal amount equal to the unredeemed portion thereof will be
issued;
(e) that Securities called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price;
(f) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security or portion thereof to be redeemed, and
that (unless the Company shall default in payment of the Redemption Price)
interest thereon shall cease to accrue on and after said date;
(g) the names and addresses of the Paying Agent and the offices or
agencies referred to in Section 1002 where such Securities are to be
surrendered for payment of the Redemption Price;
(h) the CUSIP, ISIN or CINS number, if any, relating to such
Securities; and
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(i) the procedures that a Holder must follow to surrender the
Securities to be redeemed.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's written request,
by the Trustee in the name and at the expense of the Company. If the Company
elects to give notice of redemption, it shall provide the Trustee with a
certificate stating that such notice has been given in compliance with the
requirements of this Section 1105.
The notice if mailed in the manner herein provided shall be
conclusively presumed to have been given, whether or not the Holder receives
such notice. In any case, failure to give such notice by mail or any defect in
the notice to the Holder of any Security designated for redemption as a whole or
in part shall not affect the validity of the proceedings for the redemption of
any other Security.
Section 1106. Deposit of Redemption Price.
On or prior to any Redemption Date, the Company shall deposit with
the Trustee or with a Paying Agent (or, if the Company or any of its Affiliates
is acting as Paying Agent, segregate and hold in trust as provided in Section
1003) an amount of money in same day funds sufficient to pay the Redemption
Price of, and (except if the Redemption Date shall be an Interest Payment Date
or Special Payment Date) accrued interest on, all the Securities or portions
thereof which are to be redeemed on that date. The Paying Agent shall promptly
mail or deliver to Holders of Securities so redeemed payment in an amount equal
to the Redemption Price of the Securities purchased from each such Holder. All
money, if any, earned on funds held in trust by the Trustee or any Paying Agent
prior to the Redemption Date shall be remitted to the Company. For purposes of
this Section 1106, the Company shall choose a Paying Agent which shall not be
the Company.
Section 1107. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities
so to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Holders will be required
to surrender the Securities to be redeemed to the Paying Agent at the address
specified in the notice of redemption at least one Business Day prior to the
Redemption Date. Upon surrender of any such Security for redemption in
accordance with said notice, such Security shall be paid by the Company at the
Redemption Price together with accrued interest to the Redemption Date;
provided, however, that installments of interest whose Stated Maturity is on or
prior to the Redemption Date shall be payable to the Holders of such Securities,
or one or more Predecessor Securities, registered as such on the relevant
Regular Record Dates and Special Record Dates according to the terms and the
provisions of Section 309.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and premium, if any, shall,
until paid, bear interest from the Redemption Date at the rate borne by such
Security.
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Section 1108. Securities Redeemed or Purchased in Part.
Any Security which is to be redeemed or purchased only in part shall
be surrendered to the Paying Agent at the office or agency maintained for such
purpose pursuant to Section 1002 (with, if the Company, the Security Registrar
or the Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company, the Security Registrar or the
Trustee, as the case may be, duly executed by, the Holder thereof or such
Holder's attorney duly authorized in writing), and the Company shall execute,
and the Trustee shall authenticate and deliver to the Holder of such Security
without service charge, a new Security or Securities, of any authorized
denomination as requested by such Holder in aggregate principal amount equal to,
and in exchange for, the unredeemed portion of the principal of the Security so
surrendered that is not redeemed or purchased.
ARTICLE TWELVE
SATISFACTION AND DISCHARGE
Section 1201. Satisfaction and Discharge of Indenture.
This Indenture shall be discharged and shall cease to be of further
effect (except as to surviving rights of registration of transfer or exchange of
Securities as expressly provided for herein) as to all Outstanding Securities
hereunder, and the Trustee, upon Company Request and at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(a) either
(1) all the Securities theretofore authenticated and delivered
(other than (i) lost, stolen or destroyed Securities which have been
replaced or paid as provided in Section 308 or (ii) all Securities
whose payment has theretofore been deposited in trust or segregated
and held in trust by the Company and thereafter repaid to the
Company or discharged from such trust as provided in Section 1003)
have been delivered to the Trustee for cancellation; or
(2) all such Securities not theretofore delivered to the
Trustee for cancellation have become due and payable and the Company
or any Guarantor has irrevocably deposited or caused to be deposited
with the Trustee as trust funds in trust an amount in United States
dollars sufficient to pay and discharge the entire Indebtedness on
the Securities not theretofore delivered to the Trustee for
cancellation, including the principal of, premium, if any, and
accrued interest on, such Securities at such Maturity, Stated
Maturity or Redemption Date;
(b) the Company or any Guarantor has paid or caused to be paid all
other sums payable hereunder by the Company and any Guarantor; and
(c) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Independent Counsel, in form and substance
reasonably satisfactory to the Trustee, each stating that (i) all
conditions precedent herein relating to the satisfaction and discharge
hereof have been complied with and (ii) such satisfaction and discharge
will not result in a breach or violation of, or
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constitute a default under, this Indenture or any other material
agreement or instrument to which the Company, any Guarantor or any
Subsidiary is a party or by which the Company, any Guarantor or any
Subsidiary is bound.
Notwithstanding the satisfaction and discharge hereof, the
obligations of the Company to the Trustee under Section 606 and, if United
States dollars shall have been deposited with the Trustee pursuant to subclause
(2) of subsection (a) of this Section 1201, the obligations of the Trustee under
Section 1202 and the last paragraph of Section 1003 shall survive.
Section 1202. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all
United States dollars deposited with the Trustee pursuant to Section 1201 shall
be held in trust and applied by it, in accordance with the provisions of the
Securities and this Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Persons entitled thereto, of the principal of,
premium, if any, and interest on, the Securities for whose payment such United
States dollars have been deposited with the Trustee.
ARTICLE THIRTEEN
COLLATERAL AND SECURITY
Section 1301. Escrow Agreement.
The due and punctual payment of the first six scheduled interest
payments on the Securities and Additional Interest, if any, when and as the same
shall be due and payable on an Interest Payment Date or by acceleration shall be
secured as provided in the Escrow Agreement which the Company and the Trustee
have entered into simultaneously with the execution of this Indenture. Upon the
acceleration of the Maturity of the Securities prior to the payment in full of
the first six scheduled interest payments, the Trustee shall foreclose upon the
Collateral. Each Holder of Securities, by its acceptance thereof, consents and
agrees to the terms of the Escrow Agreement (including, without limitation, the
provisions providing for foreclosure and disbursement of Collateral) as the same
may be in effect or may be amended from time to time in accordance with its
terms and the terms hereof and authorizes and directs the Escrow Agent and the
Trustee to enter into the Escrow Agreement and to perform its obligations and
exercise its rights thereunder in accordance therewith. The Company shall
deliver to the Trustee copies of the Escrow Agreement, and shall do or cause to
be done all such acts and things as may be necessary or proper, or as may be
required by the provisions of the Escrow Agreement, to assure and confirm to the
Trustee the security interest in the Collateral contemplated by the Escrow
Agreement or any part thereof, as from time to time constituted, so as to render
the same available for the security and benefit of this Indenture with respect
to, and of, the Securities, according to the intent and purposes expressed in
the Escrow Agreement. The Company shall take any and all actions reasonably
required to cause the Escrow Agreement to create and maintain (to the extent
possible under applicable law), as security for the obligations of the Company
hereunder, a first priority and exclusive security interest in and on all the
Collateral, in favor of the Trustee for the benefit of the Holders of
Securities, superior to and prior to the rights of all third Persons and subject
to no other Liens. The Trustee shall have no responsibility for perfecting or
maintaining the perfection of the Trustee's security interest in the Collateral
or for filing any instrument, document or notice in any public office at any
time or times.
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Section 1302. Recording and Opinions.
(a) The Company shall furnish to the Trustee simultaneously with the
execution and delivery of this Indenture an Opinion of Counsel either (i)
stating that in the opinion of such counsel all action has been taken with
respect to the recording, registering and filing of this Indenture,
financing statements or other instruments necessary to make effective the
security interest intended to be created by the Escrow Agreement and
reciting the details of such action, or (ii) stating that in the opinion
of such counsel no such action is necessary to make such security interest
effective.
(b) The Company shall furnish to the Trustee on each anniversary of
the Issue Date until the date upon which the balance of Escrow Funds shall
have been reduced to zero, an Opinion of Counsel, dated as of such date,
complying in all respects with Section 314(b) of the Trust Indenture Act.
Section 1303. Release of Collateral.
(a) Subject to paragraphs (b), (c) and (d) of this Section 1303, the
Collateral may be released from the security interest created by the
Escrow Agreement only in accordance with the provisions of the Escrow
Agreement.
(b) Except to the extent that any security interest on proceeds of
Collateral is automatically released by operation of Section 9-306 of the
Uniform Commercial Code or other similar law, no Collateral shall be
released from the security interest created by the Escrow Agreement
pursuant to the provisions of the Escrow Agreement, other than to the
Holders pursuant to the terms thereof.
(c) At any time when an Event of Default shall have occurred and be
continuing and the Maturity of the Securities shall have been accelerated
(whether by declaration or otherwise), no Collateral shall be released
pursuant to the provisions of the Escrow Agreement, and no release of
Collateral in contravention of this Section 1303(c) shall be effective as
against the Holders of Securities, except for the disbursement of all
Escrow Funds (as defined in the Escrow Agreement) and other Collateral to
the Trustee pursuant to Section 6(c) of the Escrow Agreement.
(d) To the extent applicable, the Company shall cause Section 314(d)
of the Trust Indenture Act, relating to the release of property or
securities from the security interest of the Escrow Agreement, to be
complied with.
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Section 1304. Authorization of Actions to be Taken by the
Trustee Under the Escrow Agreement.
Subject to the provisions of Section 601 and Section 603, the
Trustee may, without the consent of the Holders of Securities, on behalf of the
Holders of Securities, take all actions it deems necessary or appropriate in
order to (a) enforce any of the terms of the Escrow Agreement and (b) collect
and receive any and all amounts payable in respect of the obligations of the
Company hereunder. The Trustee shall have power to institute and maintain such
suits and proceedings as it may deem expedient to prevent any impairment of the
Collateral by any acts that may be unlawful or in violation of the Escrow
Agreement or this Indenture, and such suits and proceedings as the Trustee may
deem expedient to preserve or protect its interests and the interests of the
Holders of Securities in the Collateral (including power to institute and
maintain suits or proceedings to restrain the enforcement of or compliance with
any legislative or other governmental enactment, rule or order that may be
unconstitutional or otherwise invalid if the enforcement of, or compliance with,
such enactment, rule or order would impair the security interest hereunder or be
prejudicial to the interests of the Holders of Securities or of the Trustee).
Section 1305. Authorization of Receipt of Funds by the Trustee Under
the Escrow Agreement.
The Trustee is authorized to receive any funds for the benefit of
the Holders of Securities disbursed under the Escrow Agreement, and to make
further distributions of such funds to the Holders of Securities according to
the provisions of this Indenture.
Section 1306. Termination of Security Interest.
Upon the earliest to occur of (i) the date upon which the balance of
Escrow Funds and other Collateral shall have been reduced to zero, (ii) the
payment of the first six scheduled interest payments on the Securities, (iii)
legal defeasance of all Outstanding Securities pursuant to Section 402 and (iv)
covenant defeasance of all Outstanding Securities pursuant to Section 403, the
Trustee shall, at the written request of the Company, release the security
interest in the Collateral pursuant to this Indenture and the Escrow Agreement
upon the Company's compliance with the provisions of the Trust Indenture Act
pertaining to release of collateral.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the day and year first above written.
BELL TECHNOLOGY GROUP LTD.
By:
--------------------------------
Name:
Title:
Attest:
- --------------------------------
100
Name:
Title:
MARINE MIDLAND BANK, as Trustee
By:
--------------------------------
Name:
Title:
101
STATE OF )
) ss.:
COUNTY OF )
On the day of , 1998, before me personally came __________, to
me known, who, being by me duly sworn, did depose and say that he resides at
_________; that he is _________________of_______________________, a corporation
described in and which executed the foregoing instrument; and that he signed his
name thereto pursuant to authority of the Board of Directors of such
corporation.
-------------------------------------
(NOTARIAL SEAL)
STATE OF )
) ss.:
COUNTY OF )
On the day of , 1998, before me personally came __________, to
me known, who, being by me duly sworn, did depose and say that he resides at
_________; that he is _________________of_______________________, a corporation
described in and which executed the foregoing instrument; and that he signed his
name thereto pursuant to authority of the Board of Directors of such
corporation.
-------------------------------------
(NOTARIAL SEAL)
EXHIBIT A
REGULATION S CERTIFICATE
(For transfers pursuant to ss. 307(a)(i) of the Indenture)
Marine Midland Bank, as Trustee
140 Broadway, 12th Floor
New York, New York 10005
Re: 13% Senior Notes due 2005 of
Bell Technology Group Ltd. (the "Securities")
Reference is made to the Indenture, dated as of April 30, 1998 (the
"Indenture"), among Bell Technology Group Ltd. (the "Company") and Marine
Midland Bank, as Trustee. Terms used herein and defined in the Indenture or in
Regulation S or Rule 144 under the U.S. Securities Act of 1933 (the "Securities
Act") are used herein as so defined.
This certificate relates to US$_________________ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):
CUSIP No(s).
---------------------------
CERTIFICATE No(s).
---------------------------
The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner."
The Specified Securities are represented by a Global Security and are held
through the Depositary or an Agent Member in the name of the Undersigned, as or
on behalf of the Owner.
The Owner has requested that the Specified Securities be transferred
to a person (the "Transferee") who will take delivery in the form of a
Regulation S Global Security. In connection with such transfer, the Owner hereby
certifies that, unless such transfer is being effected pursuant to an effective
registration statement under the Securities Act, it is being effected in
accordance with Rule 904 or Rule 144 under the Securities Act and with all
applicable securities laws of the states of the United States and other
jurisdictions. Accordingly, the Owner hereby further certifies as follows:
(1) Rule 904 Transfers. If the transfer is being effected in
accordance with Rule 904:
(A) the Owner is not a distributor of the Specified
Securities, an affiliate of the Company or any such distributor or a
person acting on behalf of any of the foregoing;
(B) the offer of the Specified Securities was not made to a
person in the United States;
A-1
(C) either:
(i) at the time the buy order was originated, the
Transferee was outside the United States or the Owner and any
person acting on its behalf reasonably believed that the
Transferee was outside the United States, or
(ii) the transaction is being executed in, on or through
the facilities of the Eurobond market, as regulated by the
Association of International Bond Dealers, or another
designated offshore securities market described in Section
902(a) of Regulation S and neither the Owner nor any person
acting on its behalf knows that the transaction has been
prearranged with a buyer in the United States;
(D) no directed selling efforts have been made in the United
States by or on behalf of the Owner or any affiliate thereof;
(E) if the Owner is a dealer in securities, as defined in
Section 2(12) of the Securities Act, or has received a selling
concession, fee or other remuneration in respect of the Specified
Securities, and the transfer is to occur during the Distribution
Compliance Period, then:
(i) neither the Owner nor any person acting on behalf of
the Owner knows that the Transferee of the Specified
Securities is a U.S. person; and
(ii) if the Owner or any person acting on the Owner's
behalf knows that the Transferee is a dealer, as defined in
Section 2(12) of the Securities Act, or is a person receiving
a selling concession, fee or other remuneration in respect of
the Specified Securities, the Owner or a person acting on the
Owner's behalf has sent to the Transferee a confirmation or
other notice stating that the Specified Securities may be
offered and sold during the Distribution Compliance Period
only: (x) in accordance with Regulation S; (y) pursuant to
registration of the Specified Securities under the Securities
Act; or (z) pursuant to an available exemption from the
registration requirements of the Securities Act; and
(F) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act.
(2) Rule 144 Transfers. If the transfer is being effected pursuant to
Rule 144:
(A) the transfer is occurring after a holding period of at
least one year (computed in accordance with paragraph (d) of Rule
144) has elapsed since the Specified Securities were last acquired
from the Company or from an affiliate of the Company, whichever is
later, and is being effected in accordance with the applicable
amount, manner of sale and notice requirements of Rule 144; or
(B) the transfer is occurring after a holding period of at
least two years has elapsed since the Specified Securities were last
acquired from the Company or from an affiliate of the Company,
whichever is later, and the Owner is not, and during the preceding
three months has not been, an affiliate of the Company.
A-2
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company and the Initial Purchaser.
Dated:
(Print the name of the Undersigned, as such
term is defined in the third paragraph of this
certificate.)
By:
--------------------------
Name:
Title:
(If the Undersigned is a corporation,partnership
or fiduciary, the title of the person signing on
behalf of the Undersigned must be stated.)
A-3
EXHIBIT B
RESTRICTED SECURITIES CERTIFICATE
(For transfers pursuant to ss. 307(a)(ii) of the Indenture)
Marine Midland Bank, as Trustee
140 Broadway, 12th Floor
New York, New York 10005
Re: 13% Senior Notes due 2005 of
Bell Technology Group Ltd. (the "Securities")
Reference is made to the Indenture, dated as of April 30, 1998 (the
"Indenture"), among Bell Technology Group Ltd. (the "Company") and Marine
Midland Bank, as Trustee. Terms used herein and defined in the Indenture or in
Rule 144A or Rule 144 under the U.S. Securities Act of 1933 (the "Securities
Act") are used herein as so defined.
This certificate relates to US$ principal amount of Securities,
which are evidenced by the following certificate(s) (the "Specified
Securities"):
CUSIP No(s).
--------------------------
ISIN No(s). If any.
--------------------
CERTIFICATE No(s).
---------------------
The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
The Specified Securities are represented by a Global Security and are held
through the Depositary or an Agent Member in the name of the Undersigned, as or
on behalf of the Owner.
The Owner has requested that the Specified Securities be transferred
to a person (the "Transferee") who will take delivery in the form of a
Restricted Security. In connection with such transfer, the Owner hereby
certifies that, unless such transfer is being effected pursuant to an effective
registration statement under the Securities Act, it is being effected in
accordance with Rule 144A or Rule 144 under the Securities Act and all
applicable securities laws of the states of the United States and other
jurisdictions. Accordingly, the Owner hereby further certifies as follows:
(1) Rule 144A Transfers. If the transfer is being effected in
accordance with Rule 144A:
(A) the Specified Securities are being transferred to a person
that the Owner and any person acting on its behalf reasonably
believe is a "qualified institutional buyer" within the meaning of
Rule 144A, acquiring for its own account or for the account of a
qualified institutional buyer; and
B-1
(B) the Owner and any person acting on its behalf have taken
reasonable steps to ensure that the Transferee is aware that the
Owner may be relying on Rule 144A in connection with the transfer;
and
(2) Rule 144 Transfers. If the transfer is being effected pursuant
to Rule 144:
(A) the transfer is occurring after a holding period of at
least one year (computed in accordance with paragraph (d) of Rule
144) has elapsed since the Specified Securities were last acquired
from the Company or from an affiliate of the Company, whichever is
later, and is being effected in accordance with the applicable
amount, manner of sale and notice requirements of Rule 144; or
(B) the transfer is occurring after a holding period of at
least two years has elapsed since the Specified Securities were last
acquired from the Company or from an affiliate of the Company,
whichever is later, and the Owner is not, and during the preceding
three months has not been, an affiliate of the Company.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company and the Initial Purchasers.
Dated:
(Print the name of the Undersigned, as such
term is defined in the third paragraph of this
certificate.)
By:
--------------------------
Name:
Title:
(If the Undersigned is a corporation,partnership
or fiduciary, the title of the person signing on
behalf of the Undersigned must be stated.)
B-2
EXHIBIT C
UNRESTRICTED SECURITIES CERTIFICATE
(For removal of Securities Act Legends pursuant to ss. 307(b) of the Indenture)
Marine Midland Bank, as Trustee
140 Broadway, 12th Floor
New York, New York 10005
Re: 13% Senior Notes due 2005 of
Bell Technology Group Ltd. (the "Securities")
Reference is made to the Indenture, dated as of April 30, 1998 (the
"Indenture"), among Bell Technology Group Ltd. (the "Company") and Marine
Midland Bank, as Trustee. Terms used herein and defined in the Indenture or in
Rule 144 under the U.S. Securities Act of 1933 (the "Securities Act") are used
herein as so defined. This certificate relates to US$ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):
CUSIP No(s).
-----------------
CERTIFICATE No(s).
------------------
The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Securities are represented by a Global Security, they are held
through the Depositary or an Agent Member in the name of the Undersigned, as or
on behalf of the Owner. If the Specified Securities are not represented by a
Global Security, they are registered in the name of the Undersigned, as or on
behalf of the Owner.
The Owner has requested that the Specified Securities be exchanged
for Securities bearing no Private Placement Legend pursuant to Section 307(b) of
the Indenture. In connection with such exchange, the Owner hereby certifies that
the exchange is occurring after a holding period of at least two years (computed
in accordance with paragraph (d) of Rule 144) has elapsed since the Specified
Securities were last acquired from the Company or from an affiliate of the
Company, whichever is later, and the Owner is not, and during the preceding
three months has not been, an affiliate of the Company. The Owner also
acknowledges that any future transfers of the Specified Securities must comply
with all applicable securities laws of the states of the United States and other
jurisdictions.
C-1
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company and the Initial Purchasers.
Dated:
(Print the name of the Undersigned, as such
term is defined in the third paragraph of this
certificate.)
By:
--------------------------
Name:
Title:
(If the Undersigned is a corporation,partnership
or fiduciary, the title of the person signing on
behalf of the Undersigned must be stated.)
C-2
APPENDIX I
[FORM OF TRANSFER NOTICE]
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto
Insert Taxpayer Identification No.
- --------------------------------------------------------------------------------
(Please print or typewrite name and address including zip code of assignee)
- --------------------------------------------------------------------------------
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing attorney to transfer such Security on the books of the Company
with full power of substitution in the premises.
[THE FOLLOWING PROVISION TO BE INCLUDED ON ALL
CERTIFICATES FOR SERIES A SECURITIES EXCEPT
PERMANENT OFFSHORE PHYSICAL CERTIFICATES]
In connection with any transfer of this Security occurring prior to the
date which is the earlier of the date of an effective Registration Statement or
the end of the period referred to in Rule 144(k) under the Securities Act, the
undersigned confirms that without utilizing any general solicitation or general
advertising that:
[Check One]
|_|(a) this Security is being transferred in compliance with the
exemption from registration under the Securities Act of 1933,
as amended, provided by Rule 144A thereunder.
or
|_|(b) this Security is being transferred other than in accordance
with (a) above and documents are being furnished which comply
with the conditions of transfer set forth in this Security and
the Indenture.
I-1
If none of the foregoing boxes is checked, the Trustee or other Security
Registrar shall not be obligated to register this Security in the name of any
Person other than the Holder hereof unless and until the conditions to any such
transfer of registration set forth herein and in Section 307 of the Indenture
shall have been satisfied.
Date:
--------------------------------------------------------
NOTICE: The signature to this assignment must correspond
with the name as written upon the face of the
within-mentioned instrument in every particular, without
alteration or any change whatsoever.
Signature Guarantee:
------------------------------------
[Signature must be guaranteed by an eligible Guarantor Institution (banks, stock
brokers, savings and loan associations and credit unions) with membership in an
approved guarantee medallion program pursuant to Securities and Exchange
Commission Rule 17Ad-15]
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, as amended, and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges that it has received such information regarding the
Company as the undersigned has requested pursuant to Rule 144A or has determined
not to request such information and that it is aware that the transferor is
relying upon the undersigned's foregoing representations in order to claim the
exemption from registration provided by Rule 144A.
Date:
-------------------------------------------------
NOTICE: to be executed by an authorized signatory
I-2
APPENDIX II
FORM OF TRANSFEREE CERTIFICATE
I or we assign and transfer this Security to:
- --------------------------------------------------------------------------------
Please insert social security or other identifying number of assignee
- --------------------------------------------------------------------------------
Print or type name, address and zip code of assignee and irrevocably appoint
[Agent], to transfer this Security on the books of the Company. The Agent may
substitute another to act for him.
Dated Signed
(Sign exactly as name appears on the other
side of this Security)
[Signature must be guaranteed by an eligible Guarantor Institution (banks, stock
brokers, savings and loan associations and credit unions) with membership in an
approved guarantee medallion program pursuant to Securities and Exchange
Commission Rule 17 Ad-15]
II-1