EXHIBIT 4.9
_______________________________________________________________________________
INTERNATIONAL CABLETEL INCORPORATED
Issuer
___________________
10% Senior Notes Due 2007
and
10% Series B Senior Notes Due 2007
___________________
INDENTURE
Dated as of February 12, 1997
___________________
THE CHASE MANHATTAN BANK
as Trustee
_______________________________________________________________________________
1
TABLE OF CONTENTS
Page
----
ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.01. Definitions........................................... 1
SECTION 1.02. Other Definitions..................................... 13
SECTION 1.03. Incorporation by Reference of Trust
Indenture Act........................................ 14
SECTION 1.04. Rules of Construction................................. 14
ARTICLE II
The Securities
SECTION 2.01. Form and Dating....................................... 15
SECTION 2.02. Execution and Authentication.......................... 17
SECTION 2.03. Registrar and Paying Agent............................ 17
SECTION 2.04. Paying Agent to Hold Money in Trust................... 18
SECTION 2.05. Noteholder Lists...................................... 18
SECTION 2.06. Transfer and Exchange................................. 18
SECTION 2.07. Replacement Securities................................ 21
SECTION 2.08. Outstanding Securities................................ 21
SECTION 2.09. Treasury Securities................................... 22
SECTION 2.10. Temporary Securities.................................. 22
SECTION 2.11. Cancellation.......................................... 23
SECTION 2.12. Defaulted Interest.................................... 23
ARTICLE III
Redemption
SECTION 3.01. Notices to Trustee.................................... 23
SECTION 3.02. Selection of Securities to Be Redeemed................ 24
SECTION 3.03. Notice of Redemption.................................. 24
SECTION 3.04. Effect of Notice of Redemption........................ 25
SECTION 3.05. Deposit of Redemption Price........................... 25
SECTION 3.06. Securities Redeemed in Part........................... 25
SECTION 3.07. Optional Redemption and Optional Tax
Redemption........................................... 25
SECTION 3.08. Asset Sale Offer and Purchase Offer................... 25
ARTICLE IV
Covenants
SECTION 4.01. Payment of Securities................................. 28
SECTION 4.02. SEC Reports........................................... 28
2
SECTION 4.03. Compliance Certificate................................ 28
SECTION 4.04. Stay, Extension and Usury Laws........................ 29
SECTION 4.05. Corporate Existence................................... 29
SECTION 4.06. Taxes 29
SECTION 4.07. Limitations on Liens.................................. 30
SECTION 4.08. Limitation on Indebtedness and Issuance of
Preferred Stock...................................... 30
SECTION 4.09. Limitation on Restricted Payments..................... 32
SECTION 4.10. Asset Sales........................................... 35
SECTION 4.11. Limitations on Transactions with
Affiliates........................................... 39
SECTION 4.12. Limitations on Dividends and Other Payment
Restrictions Affecting Subsidiaries.................. 40
SECTION 4.13. Change of Control..................................... 41
SECTION 4.14. Payment of Additional Amounts......................... 41
ARTICLE V
Successors
SECTION 5.01. Merger, Consolidation or Sale of Assets............... 42
SECTION 5.02. Successor Corporation Substituted..................... 43
ARTICLE VI
Defaults and Remedies
SECTION 6.01. Events of Default..................................... 43
SECTION 6.02. Acceleration.......................................... 45
SECTION 6.03. Other Remedies........................................ 46
SECTION 6.04. Waiver of Past Defaults............................... 46
SECTION 6.05. Control by Majority................................... 46
SECTION 6.06. Limitation on Suits................................... 46
SECTION 6.07. Rights of Noteholders to Receive Payment.............. 47
SECTION 6.08. Collection Suit by Trustee............................ 47
SECTION 6.09. Trustee May File Proofs of Claim...................... 47
SECTION 6.10. Priorities............................................ 47
SECTION 6.11. Undertaking for Costs................................. 47
ARTICLE VII
Trustee
SECTION 7.01. Duties of Trustee..................................... 48
SECTION 7.02. Rights of Trustee..................................... 49
SECTION 7.03. Individual Rights of Trustee.......................... 49
SECTION 7.04. Trustee's Disclaimer.................................. 49
SECTION 7.05. Notice of Defaults.................................... 49
SECTION 7.06. Reports by Trustee to Noteholders..................... 49
SECTION 7.07. Compensation and Indemnity............................ 50
SECTION 7.08. Replacement of Trustee................................ 50
3
SECTION 7.09. Successor Trustee by Merger, Etc...................... 51
SECTION 7.10. Eligibility; Disqualification......................... 51
SECTION 7.11. Preferential Collection of Claims Against Company..... 52
ARTICLE VIII
Discharge of Indenture
SECTION 8.01. Termination of Company's Obligations.................. 52
SECTION 8.02. Option to Effect Defeasance........................... 52
SECTION 8.03. Application of Trust Money............................ 54
SECTION 8.04. Repayment to Company.................................. 54
SECTION 8.05. Reinstatement......................................... 54
ARTICLE IX
Amendments, Supplements and Waivers
SECTION 9.01. Without Consent of Noteholders........................ 55
SECTION 9.02. With Consent of Noteholders........................... 55
SECTION 9.03. Compliance with Trust Indenture Act................... 56
SECTION 9.04. Revocation and Effect of Consents..................... 56
SECTION 9.05. Notation on or Exchange of Securities................. 57
SECTION 9.06. Trustee Protected..................................... 57
ARTICLE X
Miscellaneous
SECTION 10.01. Trust Indenture Act Controls......................... 57
SECTION 10.02. Notices.............................................. 57
SECTION 10.03. Communication by Noteholders with Other Noteholders.. 58
SECTION 10.04. Certificate and Opinion as to Conditions Precedent... 58
SECTION 10.05. Statements Required in Certificate or Opinion........ 58
SECTION 10.06. Rules by Trustee and Agents.......................... 58
SECTION 10.07. Legal Holidays....................................... 59
SECTION 10.08. No Recourse Against Others........................... 59
SECTION 10.09. Counterparts......................................... 59
SECTION 10.10. Variable Provisions.................................. 59
SECTION 10.11. GOVERNING LAW........................................ 60
SECTION 10.12. No Adverse Interpretation of Other
Agreements........................................... 60
SECTION 10.13. Successors........................................... 60
SECTION 10.14. Severability......................................... 60
SECTION 10.15. Table of Contents, Headings, Etc..................... 60
SIGNATURES..............................................................
EXHIBIT A FORM OF INITIAL NOTE
EXHIBIT B FORM OF EXCHANGE NOTE
EXHIBIT C FORM OF TRANSFER CERTIFICATE PURSUANT
4
TO SECTION 2.06(a)(ii)
EXHIBIT D FORM OF TRANSFER CERTIFICATE PURSUANT
TO SECTION 2.06(a)(iii)
EXHIBIT E FORM OF TRANSFER CERTIFICATE PURSUANT
TO SECTION 2.06(a)(iv) or 2.06(a)(v)
EXHIBIT F FORM OF TRANSFEREE CERTIFICATE PURSUANT
TO SECTION 2.06(a)(iv) or 2.06(a)(v)
EXHIBIT G FORM OF TRANSFER CERTIFICATE PURSUANT
TO SECTION 2.06(a)(viii)
EXHIBIT H FORM OF TRANSFER CERTIFICATE PURSUANT
TO SECTION 2.06(a)(viii)
EXHIBIT I FORM OF TRANSFER CERTIFICATE PURSUANT
TO SECTION 2.06(a)(viii)
5
CROSS-REFERENCE TABLE*
Trust Indenture Indenture
Act Section Section
310(a)(1)......................................... 7.10
(a)(2)........................................... 7.10
(a)(3)........................................... N.A.
(a)(4)........................................... N.A.
(a)(5)........................................... 7.10
(b).............................................. 7.08, 7.10
(c).............................................. N.A.
311(a)............................................ 7.11
(b).............................................. 7.11
(c).............................................. N.A.
312(a)............................................ 2.05
(b).............................................. 10.03
(c).............................................. 10.03
313(a)............................................ 7.06
(b)(1)........................................... N.A.
(b)(2)........................................... 7.06
(c).............................................. 7.06
(d).............................................. 7.06
314(a)............................................ 4.02, 4.03
(b).............................................. N.A.
(c)(1)........................................... 10.04
(c)(2)........................................... 10.04
(c)(3)........................................... N.A.
(d).............................................. N.A.
(e).............................................. N.A.
(f).............................................. N.A.
315(a)............................................ 7.01(b)
(b).............................................. 7.05
(c).............................................. 7.01(a)
(d).............................................. 7.01(c)
(e).............................................. 6.11
316(a)(last sentence)............................. 2.09
(a)(1)(A)........................................ 6.05
(a)(1)(B)........................................ 6.04
(a)(2)........................................... N.A.
(b).............................................. 6.07
(c).............................................. 9.04
317(a)(1)......................................... 6.08
(a)(2)........................................... 6.09
(b).............................................. 2.04
318(a)............................................ N.A.
N.A. means not applicable.
______________
* This Cross-Reference Table is not part of the Indenture.
6
INDENTURE dated as of February 12, 1997 between International CableTel
Incorporated, a Delaware corporation (the "Company"), and The Chase Manhattan
-------
Bank, a New York corporation, as trustee (the "Trustee").
-------
Each party agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the holders (as defined in Section 1.01) of
the Company's 10% Senior Notes Due 2007 (the "Initial Notes") and if and when
-------------
issued in exchange for Initial Notes, the Company's 10% Series B Senior Notes
Due 2007 (the "Exchange Notes" and, together with the Initial Notes, the
--------------
"Securities"):
- -----------
ARTICLE I
Definitions and Incorporation by Reference
------------------------------------------
SECTION 1.01. Definitions.
-----------
"11 12% Notes" means the Company's 11 12% Series B Senior
-------------
Deferred Coupon Notes Due 2006.
"12 34% Notes" means the Company's 12 34% Series A Senior
-------------
Deferred Coupon Notes Due 2005.
"Acquired Debt" means, with respect to any specified person,
-------------
Indebtedness of any other person existing at the time such other person merged
with or into or became a Subsidiary of such specified person, including
Indebtedness incurred in connection with, or in contemplation of, such other
person merging with or into or becoming a Subsidiary of such specified person.
"Affiliate" of any specified person means any other person directly or
---------
indirectly controlling or controlled by or under direct or indirect common
control with such specified person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such person, whether through the
ownership of voting securities, by agreement or otherwise; provided, however,
-----------------
that beneficial ownership of 10% or more of the voting securities of a person
shall be deemed to be control.
"Agent" means any Registrar, Paying Agent, or co-registrar.
-----
"Annualized Pro Forma EBITDA" means, with respect to any person, such
---------------------------
person's Pro Forma EBITDA for the latest fiscal quarter multiplied by four.
"Applicable Notes" means the Company's 10 78% Senior Deferred Coupon
----------------
Notes Due 2003.
"Asset Sale" means (i) any sale, lease, transfer, conveyance or other
----------
disposition of any assets (including by way of a sale-and-leaseback) other than
the sale or transfer of inventory or goods held for sale in the ordinary course
of business (provided that the sale, lease, transfer, conveyance or other
7
disposition of all or substantially all of the assets of the Company shall be
governed by Section 4.13 or 5.01 hereof or (ii) any issuance, sale, lease,
transfer, conveyance or other disposition of any Equity Interests of any of the
Company's Restricted Subsidiaries to any person; in either case other than (A)
to (w) the Company, (x) any Wholly Owned Subsidiary, or (y) any Controlled
Subsidiary which is a Subsidiary of the Company on the Issuance Date provided
that at the time of and after giving effect to such issuance, sale, lease,
transfer, conveyance or other disposition to such Controlled Subsidiary, the
Company's ownership percentage in such Controlled Subsidiary is equal to or
greater than such percentage on the Issuance Date or (B) the issuance, sale,
transfer, conveyance or other disposition of Equity Interests of a Controlled
Subsidiary in exchange for capital contributions made on a pro rata basis by the
holders of the Equity Interests of such Controlled Subsidiary.
"Board of Directors" means the Board of Directors of the Company or
------------------
any authorized committee of the Board.
"Business Day" means any day that is not a Legal Holiday.
------------
"Cable Assets" means tangible or intangible assets, licenses
------------
(including, without limitation, Licenses) and computer software used in
connection with a Cable Business.
"Cable Business" means any person directly or indirectly operating, or
--------------
owning a license to operate, a cable andor television andor telephone andor
telecommunications system or service principally within the United Kingdom
andor the Republic of Ireland.
"Cable Controlled Property" means a Cable Controlled Subsidiary or a
-------------------------
Cable Asset held by a Cable Controlled Subsidiary.
"Cable Controlled Subsidiary" means any Controlled Subsidiary which is
---------------------------
a Cable Business.
"Cable Related Business" means a person which directly or indirectly
----------------------
owns or provides a service or product used in a Cable Business, including,
without limitation, any television programming, production andor licensing
business or any programming guide or telephone directory business or content or
software related thereto.
"Capital Lease Obligation" means, at the time any determination
------------------------
thereof is to be made, the amount of the liability in respect of a capital lease
that would at such time be so required to be capitalized on the balance sheet in
accordance with GAAP.
"Capital Stock" means any and all shares, interests, participations,
-------------
rights or other equivalents (however designated) of corporate stock, including,
without limitation, partnership interests.
"Capital Stock Sale Proceeds" means the aggregate net sale proceeds
---------------------------
(including the fair market value of property, other than cash, as determined by
an independent appraisal firm) received by the Company from the issue or sale
(other than to a Subsidiary) by the Company of any class of its Capital Stock
after October 14, 1993 (including Capital Stock of the Company issued after
October 14, 1993 upon conversion of or in exchange for other securities of the
Company).
"Cash Equivalents" means (i) United States dollars or British pounds
----------------
sterling, (ii) securities issued or directly and fully guaranteed or insured by
the United States or United Kingdom government
8
or any agency or instrumentality thereof having maturities of not more than six
months and one day from the date of acquisition, (iii) certificates of deposit
and eurodollar time deposits with maturities of six months or less from the date
of acquisition, bankers' acceptances with maturities not exceeding six months
and overnight bank deposits, in each case with any commercial bank(s) domiciled
in the United States, the United Kingdom or the Republic of Ireland having
capital and surplus in excess of $500 million, (iv) repurchase obligations with
a term of not more than seven days for underlying securities of the types
described in clauses (ii) and (iii) entered into with any financial institution
meeting the qualifications specified in clause (iii) above and (v) commercial
paper rated P-1 or the equivalent thereof by Moody's or A-1 or the equivalent
thereof by S & P and in each case maturing within six months and one day after
the date of acquisition.
"Change of Control" means (i) the sale, lease or transfer of all or
-----------------
substantially all of the assets of the Company to any "person" or "group"
(within the meaning of Sections 13(d)(3) and 14(d)(2) of the Exchange Act or any
successor provision to either of the foregoing, including any group acting for
the purpose of acquiring, holding or disposing of securities within the meaning
of Rule 13d-5(b)(1) under the Exchange Act) (other than any Permitted Holder),
(ii) the approval by the requisite stockholders of the Company of a plan of
liquidation or dissolution of the Company, (iii) any "person" or "group" (within
the meaning of Sections 13(d) and 14(d)(2) of the Exchange Act or any successor
provision to either of the foregoing, including any group acting for the purpose
of acquiring, holding or disposing of securities within the meaning of Rule 13d-
5(b)(1) under the Exchange Act), other than any Permitted Holder, becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act) of more
than 50% of the total voting power of all classes of the voting stock of the
Company andor warrants or options to acquire such voting stock, calculated on a
fully diluted basis, unless, as a result of such transaction, the ultimate
direct or indirect ownership of the Company is substantially the same
immediately after such transaction as it was immediately prior to such
transaction, or (iv) during any period of two consecutive years, individuals who
at the beginning of such period constituted the Company's Board of Directors
(together with any new directors whose election or appointment by such board or
whose nomination for election by the shareholders 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 the Company's Board of Directors then in office.
"Change of Control Triggering Event" means the occurrence of both a
----------------------------------
Change of Control and a Ratings Decline.
"Company" means the party named as such above until a successor
-------
replaces it in accordance with Article V and thereafter means the successor.
"Consolidated Interest Expense" means, for any person, for any period,
-----------------------------
the amount of interest in respect of Indebtedness (including amortization of
original issue discount, amortization of debt issuance costs, and non-cash
interest payments on any Indebtedness and the interest portion of any deferred
payment obligation and after taking into account the effect of elections made
under any Interest Rate Agreement, however denominated, with respect to such
Indebtedness), the amount of Redeemable Dividends, Restricted Subsidiary
Preferred Stock Dividends and the interest component of rentals in respect of
any capital lease obligation paid, in each case whether accrued or scheduled to
be paid or accrued by such person and its Subsidiaries (other than Non-
Restricted Subsidiaries) during such period to the extent such amounts were
deducted in computing Consolidated Net Income, determined on a consolidated
basis in accordance with GAAP. For purposes of this definition, interest on a
capital lease
9
obligation shall be deemed to accrue at an interest rate reasonably determined
by such person to be the rate of interest implicit in such capital lease
obligation in accordance with GAAP consistently applied.
"Consolidated Net Income" means, with respect to any person, for any
-----------------------
period, the aggregate of the Net Income of such person and its Subsidiaries
(other than Non-Restricted Subsidiaries) for such period, on a consolidated
basis, determined in accordance with GAAP; provided that (i) the Net Income of
any person that is not a Subsidiary or that is accounted for by the equity
method of accounting shall be included only to the extent of the amount of
dividends or distributions paid to the referent person or a Wholly Owned
Subsidiary, (ii) the Net Income of any person that is a Subsidiary (other than a
Subsidiary of which at least 80% of the Capital Stock having ordinary voting
power for the election of directors or other governing body of such Subsidiary
is owned by the referent person directly or indirectly through one or more
Subsidiaries) shall be included only to the extent of the amount of dividends or
distributions paid to the referent person or a Wholly Owned Subsidiary, (iii)
the Net Income of any person acquired in a pooling of interests transaction for
any period prior to the date of such acquisition shall be excluded and (iv) the
cumulative effect of a change in accounting principles shall be excluded.
"Controlled Subsidiary" means any Restricted Subsidiary of the Company
---------------------
in which the Company has significant influence over budgetary, dividend and
capitalization decisions.
"Convertible Subordinated Notes" means the Company's 7-14%
------------------------------
Convertible Subordinated Notes issued pursuant to an indenture dated as of April
20, 1995, between the Company and The Chase Manhattan Bank (formerly known as
Chemical Bank), as trustee, and the Company's 7% Convertible Subordinated Notes
issued pursuant to an indenture dated as of June 12, 1996, between the Company
and The Chase Manhattan Bank, as trustee.
"Cumulative EBITDA" means the cumulative EBITDA of the Company from
-----------------
and after the Issuance Date to the end of the fiscal quarter immediately
preceding the date of a proposed Restricted Payment, or, if such cumulative
EBITDA for such period is negative, minus the amount by which such cumulative
EBITDA is less than zero; provided, however, that EBITDA of Non-Restricted
Subsidiaries shall not be included.
"Cumulative Interest Expense" means the aggregate amount of
---------------------------
Consolidated Interest Expense paid, accrued or scheduled to be paid or accrued
by the Company from the Issuance Date to the end of the fiscal quarter
immediately preceding a proposed Restricted Payment, determined on a
consolidated basis in accordance with GAAP.
"Default" means any event that is or with the passage of time or the
-------
giving of notice or both would be an Event of Default.
"Deferred Coupon Notes" means the Applicable Notes, the 12 34% Notes
---------------------
and the 11 12% Notes.
"Depositary" shall mean The Depository Trust Company, its nominees and
----------
their respective successors.
"Disqualified Stock" means any Capital Stock which, by its terms (or
------------------
by the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable
10
at the option of the holder thereof, in whole or in part, on or prior to the
date on which the Securities mature.
"EBITDA" means, for any person, for any period, an amount equal to (A)
------
the sum of (i) Consolidated Net Income for such period (exclusive of any gain or
loss realized in such period upon an Asset Sale), plus (ii) the provision for
taxes for such period based on income or profits to the extent such income or
profits were included in computing Consolidated Net Income and any provision for
taxes utilized in computing net loss under clause (i) hereof, plus (iii)
Consolidated Interest Expense for such period, plus (iv) depreciation for such
period on a consolidated basis, plus (v) amortization of intangibles for such
period on a consolidated basis, plus (vi) any other non-cash item reducing
Consolidated Net Income for such period, minus (B) all non-cash items increasing
Consolidated Net Income for such period, all for such person and its
Subsidiaries determined in accordance with GAAP consistently applied.
"Equity Interests" means Capital Stock and all warrants, options or
----------------
other rights to acquire Capital Stock (but excluding any Indebtedness that is
convertible into, or exchangeable for Capital Stock).
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
------------
"Exchange Rate Contract" means, with respect to any person, any
----------------------
currency swap agreements, forward exchange rate agreements, foreign currency
futures or options, exchange rate collar agreements, exchange rate insurance and
other agreements or arrangements, or combination thereof, the principal purpose
of which is to provide protection against fluctuations in currency exchange
rates. An Exchange Rate Contract may also include an Interest Rate Agreement.
"Existing Indebtedness" means Indebtedness of the Company and its
---------------------
Subsidiaries in existence on the Issuance Date, until such amounts are repaid,
including, without limitation, Existing Notes.
"Existing Notes" means the Deferred Coupon Notes and the Convertible
--------------
Subordinated Notes.
"GAAP" means generally accepted accounting principles set forth in the
----
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as approved by a significant segment of the accounting profession,
which are in effect on the Issuance Date and are applied on a consistent basis.
"Guarantee" means a guarantee (other than by endorsement of negotiable
---------
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.
"Indebtedness" means, with respect to any person, any indebtedness of
------------
such person, whether or not contingent, in respect of borrowed money or
evidenced by bonds, notes, debentures or similar instruments or letters of
credit (or reimbursement agreements in respect thereof) or representing the
balance deferred and unpaid of the purchase price of any property (including
pursuant to capital leases and sale-and-leaseback transactions) or representing
any hedging obligations under an Exchange Rate Contract or an Interest Rate
Agreement, except any such balance that constitutes an accrued expense or
11
trade payable, if and to the extent any of the foregoing indebtedness (other
than obligations under an Exchange Rate Contract or an Interest Rate Agreement)
would appear as a liability upon a balance sheet of such person prepared in
accordance with GAAP, and also includes, to the extent not otherwise included,
the Guarantee of items which would be included within this definition.
"Indenture" means this Indenture as amended from time to time.
---------
"Initial Purchasers" means Donaldson, Lufkin & Jenrette Securities
------------------
Corporation, Chase Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith
Incorporated.
"Interest Rate Agreement" means, for any person, any interest rate
-----------------------
swap agreement, interest rate cap agreement, interest rate collar agreement, or
other similar agreement, the purpose of which is to protect the party indicated
therein against fluctuations in interest rates.
"Investment Grade" means BBB- or higher by S&P or Baa3 or higher by
----------------
Moody's or the equivalent of such ratings by S&P or Moody's. In the event that
the Company shall be permitted to select any other Rating Agency, the equivalent
of such ratings by such Rating Agency shall be used.
"Investments" means, with respect to any person, all investments by
-----------
such person in other persons (including Affiliates) in the forms of loans
(including Guarantees), advances or capital contributions (excluding commission,
travel and similar advances and loans, joint property ownership and other
arrangements, in each case, made to officers and employees made in the ordinary
course of business), purchases or other acquisitions for consideration of
Indebtedness, Equity Interests or other securities and all other items that are
or would be classified as investments on a balance sheet prepared in accordance
with GAAP.
"Issuance Date" means the date on which the Securities are first
-------------
authenticated and issued.
"License" means any license issued or awarded pursuant to the
-------
Broadcasting Act 1990, the Cable and Broadcasting Act 1984, the
Telecommunications Act 1984 or the Wireless Telegraphy Act 1948 (in each case,
as such Acts may, from time to time, be amended, modified or re-enacted) (or
equivalent statutes of any jurisdiction) to operate or own a Cable Business.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
----
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction).
"Long Distance/Microwave Assets" means any assets, tangible or
------------------------------
intangible, choate or inchoate, primarily used in the business conducted by OCOM
in the United States as of the Issuance Date.
"Material License" means a License held by the Company or any of its
----------------
Subsidiaries which License at the time of determination covers a number of Net
Households which equals or exceeds 5% of the aggregate number of Net Households
covered by all of the Licenses held by the Company and its Subsidiaries at such
time.
12
"Material Subsidiary" means (i) OCOM, Cable Tel UK Group, Inc.
-------------------
(formerly known as OCOM Sub II, Inc.), NTL Investment Holding Limited, NTL Group
Limited, CableTel Surrey Limited, CableTel Cardiff Limited, CableTel Glasgow,
CableTel Newport and CableTel Kirklees and (ii) any other Subsidiary of the
Company which is a "significant subsidiary" as defined in Rule 1-02(v) of
Regulation S-X under the Securities Act and the Exchange Act (as such Regulation
is in effect on the date hereof).
"Monetize" means a strategy with respect to Capital Stock that
--------
generates an amount of cash equal to the fair value of such Capital Stock.
"Moody's" means Moody's Investors Service, Inc. and its successors.
-------
"Net Households" means the product of (i) the number of households
--------------
covered by a License in the United Kingdom and (ii) the percentage of the entity
holding such License which is owned directly or indirectly by the Company.
"Net Income" means, with respect to any person for a specific period,
----------
the net income (loss) of such person during such period, determined in
accordance with GAAP, excluding, however, any gain (but not loss) during such
period, together with any related provision for taxes on such gain (but not
loss), realized during such period in connection with any Asset Sale (including,
without limitation, dispositions pursuant to sale-and-leaseback transactions),
and excluding any extraordinary gain (but not loss) during such period, together
with any related provision for taxes on such extraordinary gain (but not loss).
"Net Proceeds" means the aggregate cash proceeds received by the
------------
Company or any of its Subsidiaries in respect of any Asset Sale, net of the
direct costs relating to such Asset Sale (including, without limitation, legal,
accounting and investment banking fees, and sales commissions) and any
relocation expenses incurred as a result thereof, taxes paid or payable as a
result thereof (after taking into account any available tax credits or
deductions and any tax sharing arrangements), amounts required to be applied to
the repayment of Indebtedness secured by a Lien on the asset or assets the
subject of such Asset Sale and any reserve for adjustment in respect of the sale
price of such asset or assets.
"Non-Controlled Subsidiary" means an entity which is not a Controlled
-------------------------
Subsidiary.
"Non-Recourse Debt" means Indebtedness or that portion of Indebtedness
-----------------
(a) as to which none of the Company, nor any of its Restricted Subsidiaries:
(i) provides credit support (including any undertaking, agreement or instrument
which would constitute Indebtedness); (ii) is directly or indirectly liable; or
(iii) constitutes the lender; and (b) no default with respect to which
(including any rights which the holders thereof may have to take enforcement
action against a Non-Restricted Subsidiary) would permit (upon notice, lapse of
time or both) any holder of any other Indebtedness of the Company or any
Restricted Subsidiary to declare a default on such other Indebtedness or cause
the payment thereof to be accelerated or payable prior to its stated maturity.
"Non-Restricted Subsidiary" means a Subsidiary that (a) at the time of
-------------------------
its designation as a Non-Restricted Subsidiary has not acquired any assets
(other than as specifically permitted by Section 4.09 hereof), at any previous
time, directly or indirectly from the Company or any of its Subsidiaries, (b)
has no Indebtedness other than Non-Recourse Debt and (c) that at the time of
such designation, after giving pro forma effect to such designation, the ratio
of Indebtedness to Annualized Pro Forma EBITDA of the Company is equal to or
less than the ratio of Indebtedness to Annualized Pro Forma EBITDA of
13
the Company immediately preceding such designation, provided, however, that if
the ratio of Indebtedness to Annualized Pro Forma EBITDA of the Company
immediately preceding such designation is 6:1 or less, then the ratio of
Indebtedness to Annualized Pro Forma EBITDA of the Company may be 0.5 greater
than such ratio immediately preceding such designation.
"Noteholder" or "holder" means a person in whose name a Security is
---------- ------
registered in the register referred to in Section 2.03.
"Obligations" means any principal, interest, penalties, fees,
-----------
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"OCOM" means OCOM Corporation, a wholly owned subsidiary of the
----
Company.
"Officers' Certificate" means a certificate signed by two Officers,
---------------------
one of whom must be the Chairman of the Board, the President, the Treasurer or a
Vice-President of the Company. See Sections 10.04 and 10.05 hereof.
---
"Opinion of Counsel" means a written opinion from legal counsel who is
------------------
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company or the Trustee. See Sections 10.04 and 10.05 hereof.
---
"Other Qualified Notes" means any outstanding senior indebtedness of
---------------------
the Company issued pursuant to an indenture having a provision substantially
similar to Section 4.10 hereof (including, without limitation, the 12 34% Notes
and the 11 12% Notes), other than the Applicable Notes.
"Permitted Designee" means (i) a spouse or a child of a Permitted
------------------
Holder, (ii) trusts for the benefit of a Permitted Holder or a spouse or child
of a Permitted Holder, (iii) in the event of the death or incompetence of a
Permitted Holder, his estate, heirs, executor, administrator, committee or other
personal representative or (iv) any person so long as a Permitted Holder owns at
least 50% of the voting power of all classes of the voting stock of such person.
"Permitted Holders" means George S. Blumenthal, J. Barclay Knapp and
-----------------
their Permitted Designees.
"Permitted Investments" means (a) any Investments in the Company or in
---------------------
a Cable Controlled Property or in a Qualified Subsidiary (including, without
limitation, (i) Guarantees of Indebtedness of the Company, a Cable Controlled
Subsidiary or a Qualified Subsidiary, (ii) Liens securing such Indebtedness or
Guarantees or (iii) the payment of any balance deferred and unpaid of the
purchase price of any Qualified Subsidiary); (b) any Investments in Cash
Equivalents; (c) Investments by the Company in Indebtedness of a counter-party
to an Exchange Rate Contract for hedging British pounds sterlingU.S. dollars
exchange risk that are made, for purposes other than speculation, in connection
with such contract to hedge not more than the aggregate principal amount of the
Securities and the Deferred Coupon Notes; and (d) Investments by the Company or
any Subsidiary of the Company in a person, if as a result of such Investment (i)
such person becomes a Cable Controlled Subsidiary or (ii) such person is merged,
consolidated or amalgamated with or into, or transfers or conveys substantially
all of its assets to, or is liquidated into, the Company or a Wholly Owned
Subsidiary of the Company.
14
"Permitted Liens" means (a) Liens in favor of the Company; (b) Liens
---------------
on property of a person existing at the time such person is merged into or
consolidated with the Company or any Subsidiary of the Company; provided, that
such Liens were in existence prior to the contemplation of such merger or
consolidation and do not secure any property or assets of the Company or any of
its Subsidiaries other than the property or assets subject to the Liens prior to
such merger or consolidation; (c) liens imposed by law, such as carriers',
warehousemen's and mechanics' liens and other similar liens arising in the
ordinary course of business which secure payment of obligations not more than
sixty (60) days past due or are being contested in good faith and by appropriate
proceedings; (d) Liens existing on the Issuance Date; (e) Liens for taxes,
assessments or governmental charges or claims that are not yet delinquent or
that are being contested in good faith by appropriate proceedings promptly
instituted and diligently concluded; provided, that any reserve or other
appropriate provision as shall be required in conformity with GAAP shall have
been made therefor and (f) easements, rights of way, restrictions and other
similar easements, licenses, restrictions on the use of properties or minor
imperfections of title that, in the aggregate, are not material in amount, and
do not in any case materially detract from the properties subject thereto or
interfere with the ordinary conduct of the business of the Company or its
Subsidiaries.
"person" means any individual, corporation, partnership, joint
------
venture, association, joint stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Preferred Stock" means the 13% Senior Redeemable Exchangeable
---------------
Preferred Stock of the Company with an original aggregate liquidation preference
of $100,000,000.
"principal" of a debt security means the principal of the security
---------
plus the premium, if any, on the security.
"Pro Forma EBITDA" means for any person, for any period, the EBITDA of
----------------
such person as determined on a consolidated basis in accordance with GAAP after
giving effect to the following: (i) if, during or after such period, such person
or any of its Subsidiaries shall have made any Asset Sale, Pro Forma EBITDA of
such person and its Subsidiaries for such period shall be reduced by an amount
equal to the Pro Forma EBITDA (if positive) directly attributable to the assets
which are the subject of such Asset Sale for the period or increased by an
amount equal to the Pro Forma EBITDA (if negative) directly attributable thereto
for such period and (ii) if, during or after such period, such person or any of
its Subsidiaries completes an acquisition of any person or business which
immediately after such acquisition is a Subsidiary of such person or whose
assets are held directly by such person or a Subsidiary of such person, Pro
Forma EBITDA shall be computed so as to give pro forma effect to the acquisition
of such person or business; and provided further that, with respect to the
Company, all of the foregoing references to "Subsidiary" or "Subsidiaries" shall
be deemed to refer only to a "Restricted Subsidiary" or "Restricted
Subsidiaries" of the Company.
"Purchase Agreement" means the Purchase Agreement dated as of February
------------------
7, 1997 between the Company and the Initial Purchasers.
"Qualified Cable Asset" shall mean an asset used in a cable system or
---------------------
a telephone system using a cable infrastructure.
"Qualified Subsidiary" means a Wholly Owned Subsidiary, or an entity
--------------------
that will become a Wholly Owned Subsidiary after giving effect to the
transaction being considered, that at the time of and
15
after giving effect to the consummation of the transaction under consideration,
(i) is a Cable Business or holds only Cable Assets, (ii) has no Indebtedness
(other than Indebtedness being incurred to consummate such transaction) and
(iii) has no encumbrances or restrictions (other than such encumbrances or
restrictions imposed or permitted by this Indenture, the indentures governing
the Deferred Coupon Notes or any other instrument governing unsecured
indebtedness of the Company which is pari passu with the Securities) on its
ability to pay dividends or make any other distributions to the Company or any
of its Subsidiaries.
"Rating Agencies" means (i) S&P, (ii) Moody's and (iii) if S&P or
---------------
Moody's or both shall not make a rating of the Securities publicly available, a
nationally recognized securities rating agency or agencies, as the case may be,
selected by the Company, which shall be substituted for S&P or Moody's or both,
as the case may be.
"Rating Category" means (i) with respect to S&P, any of the following
---------------
categories: BB, B, CCC, CC, C and D (or equivalent successor categories), (ii)
with respect to Moody's, any of the following categories: Ba, B, Caa, Ca, C and
D (or equivalent successor categories) and (iii) the equivalent of any such
category of S&P or Moody's used by another Rating Agency. In determining
whether the rating of the Securities has decreased by one or more gradations,
gradations within Rating Categories (+ and - for S&P; 1, 2 and 3 for Moody's; or
the equivalent gradations for another Rating Agency) shall be taken into account
(e.g., with respect to S&P, a decline in a rating from BB to BB-, as well as
from BB-to B+, will constitute a decrease of one gradation).
"Rating Date" means that date which is 90 days prior to the earlier of
-----------
(x) a Change of Control and (y) public notice of the occurrence of a Change of
Control or of the intention by the Company or any Permitted Holder to effect a
Change of Control.
"Ratings Decline" means the occurrence of any of the following events
---------------
on, or within six months after, the date of public notice of the occurrence of a
Change of Control or of the intention of the Company or any person to effect a
Change of Control (which period shall be extended so long as the rating of any
of the Company's debt securities is under publicly announced consideration for
possible downgrade by any of the Rating Agencies): (a) in the event that any of
the Company's debt securities are rated by both of the Rating Agencies on the
Rating Date as Investment Grade, the rating of such securities by either of the
Rating Agencies shall be below Investment Grade, (b) in the event that any of
the Company's debt securities are rated by either, but not both, of the Rating
Agencies on the Rating Date as Investment Grade, the rating of such securities
by both of the Rating Agencies shall be below Investment Grade, or (c) in the
event any of the Company's debt securities are rated below Investment Grade by
both of the Rating Agencies on the Rating Date, the rating of such securities by
either Rating Agency shall be decreased by one or more gradations (including
gradations within Rating Categories as well as between Rating Categories).
"Redeemable Dividend" means, for any dividend with regard to
-------------------
Disqualified Stock, the quotient of the dividend divided by the difference
between one and the maximum statutory federal income tax rate (expressed as a
decimal number between 1 and 0) then applicable to the issuer of such
Disqualified Stock.
"Registered Exchange Offer" shall have the meaning set forth in the
-------------------------
Registration Rights Agreement.
16
"Registration Rights Agreement" means the Registration Rights
-----------------------------
Agreement relating to the Securities dated February 12, 1997, between the
Company and the Initial Purchasers.
"Restricted Investment" means an Investment other than a Permitted
---------------------
Investment.
"Restricted Subsidiary" means any Subsidiary of the Company which is
---------------------
not a Non-Restricted Subsidiary.
"Restricted Subsidiary Preferred Stock Dividend" means, for any
----------------------------------------------
dividend with regard to preferred stock of a Restricted Subsidiary, the quotient
of the dividend divided by the difference between one and the maximum statutory
federal income tax rate (expressed as a decimal number between 1 and 0) then
applicable to the issuer of such preferred stock.
"S&P" means Standard & Poor's Ratings Group and its successors.
---
"SEC" means the Securities and Exchange Commission.
---
"Securities" shall have the meaning set forth in the Preamble hereto.
----------
"Securities Act" means the Securities Act of 1933, as amended.
--------------
"Subordinated Debentures" means the Company's 13% Subordinated
-----------------------
Exchange Debentures Due 2009 issuable in exchange for the Preferred Stock in
accordance with the terms of the Certificate of Designation therefor and any
such debenture issued in lieu of cash interest.
"Subsidiary" means any corporation, association or other business
----------
entity of which more than 50% of the total voting power of shares of Capital
Stock entitled (without regard to the occurrence of any contingency) to vote in
the election of directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by any person or one or more of the other
Subsidiaries of that person or a combination thereof.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code (S)(S)
---
77aaa-77bbbb) as in effect on the date of execution of this Indenture.
"Trustee" means the party named as such above until a successor
-------
replaces it in accordance with the applicable provisions of this Indenture and
thereafter means the successor.
"Trust Officer" means the Chairman of the Board, the President or any
-------------
other officer or assistant officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
"Weighted Average Life to Maturity" means, when applied to any
---------------------------------
Indebtedness at any date, the number of years obtained by dividing (a) the sum
of the products obtained by multiplying (x) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (y) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (b) the then outstanding principal
amount of such Indebtedness.
17
"Wholly Owned Subsidiary" means, at any time, a Restricted Subsidiary
-----------------------
all of the Capital Stock of which (except directors' qualifying shares) is at
the time owned directly or indirectly by the Company.
SECTION 1.02. Other Definitions.
-----------------
Defined in
Term Section
"Accredited Investors".................... 2.01
"Additional Amounts"...................... 4.14
"Affiliate Transaction"................... 4.11
"Agent Member"............................ 2.01
"Asset Sale Offer"........................ 4.10
"Bankruptcy Law".......................... 6.01
"Cedel"................................... 2.01
"Change of Control Payment"............... 4.13
"Commencement Date"....................... 3.08
"Custodian"............................... 6.01
"Defeasance".............................. 8.02
"Euroclear"............................... 2.01
"Event of Default"........................ 6.01
"Excess Proceeds"......................... 4.10
"Global Security"......................... 2.01
"IAI Global Security"..................... 2.01
"incur"................................... 4.08
"Legal Holiday"........................... 10.07
"Offer Amount"............................ 3.08
"Officer"................................. 10.10
"Paying Agent"............................ 2.03
"Payment Default"......................... 6.01
"Purchase Date"........................... 3.08
"Purchase Offer".......................... 4.13
"QIBs".................................... 2.01
"Refinancing Indebtedness"................ 4.08
"Regulation S"............................ 2.01
"Regulation S Permanent Global Security".. 2.06
"Regulation S Temporary Global Security".. 2.01
"Registrar"............................... 2.03
"Restricted Securities"................... 2.01
"Restricted Global Security".............. 2.01
"Restricted Payments"..................... 4.09
"Rule 144A"............................... 2.01
"Rule 144A Global Security"............... 2.01
"Tender Period"........................... 3.08
"Transferee".............................. 2.06
"U.S. Government Obligations"............. 8.01
18
SECTION 1.03. Incorporation by Reference of Trust Indenture Act.
-------------------------------------------------
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Securities;
--------------------
"indenture security holder" means a Noteholder;
-------------------------
"indenture to be qualified" means this Indenture;
-------------------------
"indenture trustee" or "institutional trustee" means the Trustee; and
----------------- ---------------------
"obligor" on the Securities means the Company or any other obligor on
-------
the Securities.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
SECTION 1.04. Rules of Construction. Unless the context otherwise
---------------------
requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP consistently applied;
(c) references to "GAAP" shall mean GAAP in effect as of the time
----
when and for the period as to which such accounting principles are to be
applied;
(d) "or" is not exclusive;
--
(e) words in the singular include the plural, and in the plural
include the
singular; and
(f) provisions apply to successive events and transactions.
ARTICLE II
The Securities
--------------
SECTION 2.01. Form and Dating. The Initial Notes and the Trustee's
---------------
certificate of authentication shall be substantially in the form of Exhibit A
which is hereby incorporated in and expressly made a part of this Indenture.
The Exchange Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit B, which is hereby incorporated by
reference and expressly made a part of this Indenture. The Securities may have
notations, legends or endorsements required by law, stock exchange rule,
agreements to which the Company is subject, if any, or usage
19
(provided that any such notation, legend or endorsement is in a form acceptable
to the Company). The Company shall furnish any such legend not contained in
Exhibit A or Exhibit B to the Trustee in writing. Each Security shall be dated
the date of its authentication. The terms and provisions of the Securities set
forth in Exhibit A and Exhibit B are part of this Indenture and to the extent
applicable, the Company and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound thereby.
(a) Global Securities. The Initial Notes are being offered and sold
-----------------
by the Company pursuant to the Purchase Agreement.
Initial Notes offered and sold in reliance on Regulation S under the
Securities Act ("Regulation S"), as provided in the Purchase Agreement,
------------
shall be issued initially in the form of a single, temporary Global
Security in definitive, fully registered form without interest coupons with
the Global Securities Legend and Restricted Securities Legend set forth in
Exhibit A hereto (the "Regulation S Temporary Global Security") which shall
--------------------------------------
be deposited on behalf of the purchasers of the Initial Notes represented
thereby with the Trustee, at its New York office, as custodian, for the
Depositary, and registered in the name of the Depositary or the nominee of
the Depositary for the accounts of designated agents holding on behalf of
the Euroclear System ("Euroclear") or Cedel Bank, societe anonyme
---------
("Cedel"), duly executed by the Company and authenticated by the Trustee as
-----
hereinafter provided. The aggregate principal amount of the Regulation S
Temporary Global Security may from time to time be increased or deceased by
adjustments made on the records of the Trustee and the Depositary or its
nominee as hereinafter provided.
Initial Notes offered and sold to Qualified Institutional Buyers
("QIBs") in reliance on Rule 144A under the Securities Act ("Rule 144A"),
------ ---------
or offered and sold to institutional "accredited investors" (as defined in
Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act)
("Accredited Investors"), both as provided in the Purchase Agreement, shall
--------------------
be issued initially in the form of one or more permanent Global Securities
in definitive, fully registered form without interest coupons with the
Global Securities Legend and Restricted Securities Legend set forth in
Exhibit A hereto (each, respectively, a "Rule 144A Global Security" or an
-------------------------
"IAI Global Security", as the case may be), which shall be deposited on
--------------------
behalf of the purchasers of the Initial Notes represented thereby with the
Trustee, at its New York office, as custodian for the Depositary, and
registered in the name of the Depositary or a nominee 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 Security or the IAI Global Security, as the case may be, may from
time to time be increased or decreased by adjustments made on the records
of the Trustee and the Depositary or its nominee as hereinafter provided.
Upon consummation of the Registered Exchange Offer, the Exchange Notes
may be issued in the form of one or more permanent Global Securities in
definitive, fully registered form without interest coupons with the Global
Securities Legend but not the Restricted Securities Legend set forth in
Exhibit A hereto, registered in the name of the Depositary or a nominee of
the Depositary, duly executed by the Company and authenticated by the
Trustee as hereinafter provided. The aggregate principal amount of such
Global Securities may from time to time be increased or decreased by
adjustments made on the records of the Trustee and the Depositary or its
nominee as hereinafter provided.
20
(b) Book-Entry Provisions. This Section 2.01 (b) shall apply only to
---------------------
the Regulation S Temporary Global Security, the Rule 144A Global Security,
the IAI Global Security, the Regulation S Permanent Global Security (as
defined herein) and the Exchange Notes issued in the form of one or more
permanent Global Securities (collectively, the "Global Securities")
-----------------
deposited with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance with
this Section 2.01 (b), authenticate and deliver initially one or more
Global Securities that (a) shall be registered in the name of the
Depositary for such Global Security or Global Securities or the nominee of
such Depositary and (b) shall be delivered by the Trustee to such
Depositary or pursuant to such Depositary's instructions or held by the
Trustee as custodian for the Depositary.
Members of, or participants in, the Depositary ("Agent Members") shall
-------------
have no rights under this Indenture with respect to any Global Security
held on their behalf by the Depositary or by the Trustee as the custodian
of the Depositary 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 impair, as between the Depositary and its
Agent Members, the operation of customary practices of such Depositary
governing the exercise of the rights of an owner of a beneficial interest
in any Global Security.
(c) Certificated Securities. In addition to the provisions of
-----------------------
Section 2.10, owners of beneficial interests in Global Securities may, upon
request to the Trustee, receive a certificated Initial Note, which
certificated Initial Note shall bear the Restricted Securities Legend set
forth in Exhibit A hereto ("Restricted Securities").
---------------------
After a transfer of any Initial Notes during the period of the
effectiveness of a Shelf Registration Statement with respect to the Initial
Notes, all requirements for Restricted Securities Legends on such Initial Note
will cease to apply, and a certificated Initial Note without a Restricted
Securities Legend will be available to the holder of such Initial Notes. Upon
the consummation of a Registered Exchange Offer with respect to the Initial
Notes pursuant to which holders of Initial Notes are offered Exchange Notes in
exchange for their Initial Notes, certificated Initial Notes with the Restricted
Securities Legend set forth in Exhibit A hereto will be available to holders of
such Initial Notes that do not exchange their Initial Notes, and Exchange Notes
in certificated form without the Restricted Securities Legend set forth in
Exhibit A hereto will be available to holders that exchange such Initial Notes
in such Registered Exchange Offer.
SECTION 2.02. Execution and Authentication. Two Officers shall sign
----------------------------
the Securities for the Company by manual or facsimile signature. The Company's
seal shall be reproduced on the Securities.
If an Officer whose signature is on a Security no longer holds that
office at the time the Security is authenticated, the Security shall
nevertheless be valid.
21
A Security shall not be valid until authenticated by the manual
signature of an authorized officer of the Trustee. The signature shall be
conclusive evidence that the Security has been authenticated under this
Indenture.
Upon a written order of the Company signed by two Officers, the
Trustee shall authenticate (1) Initial Notes for original issue up to an
aggregate principal amount stated in paragraph 6 of the Initial Notes and (2)
Exchange Notes for issue only in a Registered Exchange Offer, pursuant to the
Registration Rights Agreement, in exchange for Initial Notes for a like
principal amount. The aggregate principal amount of Securities outstanding at
any time shall not exceed the amount set forth herein except as provided in
Section 2.07.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Securities. 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 an Agent to deal with the Company or
an Affiliate.
SECTION 2.03. Registrar and Paying Agent. The Company shall maintain
--------------------------
in the Borough of Manhattan, City of New York, State of New York (i) an office
or agency where Securities may be presented for registration of transfer or for
exchange ("Registrar") and (ii) an office or agency where Securities may be
---------
presented for payment ("Paying Agent"). The Registrar shall keep a register of
------------
the Securities and of their transfer and exchange. The Company may appoint one
or more co-registrars and one or more additional paying agents in such other
locations as it shall determine. The term "Paying Agent" includes any
additional paying agent. The Company may change any Paying Agent, Registrar or
co-registrar without prior notice to any Noteholder. The Company shall notify
the Trustee of the name and address of any Agent not a party to this Indenture.
If the Company fails to appoint or maintain another entity as Registrar or
Paying Agent, the Trustee shall act as such. The Company or any of its
Affiliates may act as Paying Agent, Registrar or co-registrar.
SECTION 2.04. Paying Agent to Hold Money in Trust. The Company shall
-----------------------------------
require each Paying Agent other than the Trustee to agree in writing that the
Paying Agent will hold in trust for the benefit of Noteholders or the Trustee
all money held by the Paying Agent for the payment of principal or interest on
the Securities, and will notify the Trustee of any default by the Company in
making any such payment. While any such default continues, the Trustee may
require a Paying Agent to pay all money held by it to the Trustee and to account
for any money disbursed by it. The Company at any time may require a Paying
Agent to pay all money held by it to the Trustee. Upon payment over to the
Trustee, the Paying Agent (if other than the Company or an Affiliate of the
Company) shall have no further liability for the money. If the Company or an
Affiliate of the Company acts as Paying Agent, it shall segregate and hold in a
separate trust fund for the benefit of the Noteholders all money held by it as
Paying Agent.
SECTION 2.05. Noteholder Lists. The Trustee shall preserve in as
----------------
current a form as is reasonably practicable the most recent list available to it
of the names and addresses of Noteholders. If the Trustee is not the Registrar,
the Company shall furnish to the Trustee on or before each interest payment date
and at such other times as the Trustee may request in writing a list in such
form and as of such date as the Trustee may reasonably require of the names and
addresses of Noteholders.
SECTION 2.06. Transfer and Exchange. Where Securities are presented
---------------------
to the Registrar or a co-registrar with a request to register a transfer or to
exchange them for an equal principal amount
22
of Securities of other denominations, the Registrar shall register the transfer
or make the exchange if its requirements for such transactions are met. To
permit registrations of transfers and exchanges, the Company shall issue and the
Trustee shall authenticate Securities at the Registrar's request. No service
charge shall be made for any registration of transfer or exchange (except as
otherwise expressly permitted herein), but the Company may require payment of a
sum sufficient to cover any transfer tax or similar governmental charge payable
in connection therewith (other than any such transfer tax or similar
governmental charge payable upon exchanges pursuant to Sections 2.10, 3.06 or
9.05 hereof).
The Company shall not be required (i) to issue, register the transfer
of or exchange Securities during a period beginning at the opening of business
15 days before the day of any selection of Securities for redemption under
Section 3.02 hereof and ending at the close of business on the day of selection,
or (ii) to register the transfer, or exchange, of any Security so selected for
redemption in whole or in part, except the unredeemed portion of any Security
being redeemed in part.
(a) Notwithstanding any provision to the contrary herein, so long as
a Global Security remains outstanding and is held by or on behalf of the
Depositary, transfers of a Global Security, in whole or in part, or of any
beneficial interest therein, shall only be made in accordance with Section
2.01 (b) and this Section 2.06(a); provided, however, that beneficial
interests in a Global Security may be transferred to persons who take
delivery thereof in the form of a beneficial interest in the same Global
Security in accordance with the transfer restrictions set forth in the
Restricted Securities Legend and under the heading "Notice to Investors" in
the Company's Offering Memorandum dated February 7, 1997.
(i) Except for transfers or exchanges made in accordance with clauses
(ii) through (iv) of this Section 2.06(a), transfers of a Global
Security shall be limited to transfers of such Global Security in
whole, but not in part, to nominees of the Depositary or to a
successor of the Depositary or such successor's nominee.
(ii) Rule 144A Global Security or IAI Global Security to Regulation S
----------------------------------------------------------------
Temporary Global Security. If an owner of a beneficial interest in the
-------------------------
Rule 144A Global Security or the IAI Global Security deposited with
the Depositary or the Trustee as custodian for the Depositary wishes
at any time to transfer its interest in such Rule 144A Global Security
or such IAI Global Security, as the case may be, to a person who is
required to take delivery thereof in the form of an interest in the
Regulation S Temporary Global Security, such owner may, subject to the
rules and procedures of the Depositary, exchange or cause the exchange
of such interest for an equivalent beneficial interest in the
Regulation S Temporary Global Securities. Upon receipt by the
Trustee, as Registrar, at its office in The City of New York of (1)
instructions given in accordance with the Depositary's procedures from
an Agent Member directing the Trustee to credit or cause to be
credited a beneficial interest in the Regulation S Temporary Global
Security in an amount equal to the beneficial interest in the Rule
144A Global Security or in the IAI Global Security, as the case may
be, to be exchanged, (2) a written order given in accordance with the
Depositary's procedures containing information regarding the
participant account of the Depositary and the Euroclear or Cedel
account to be credited with such increase and (3) a certificate in the
form of Exhibit C attached hereto given by the holder of such
beneficial interest, then the Trustee, as Registrar, shall instruct
the Depositary to reduce or cause to be reduced the principal amount
of the Rule 144A Global Security or the IAI Global Security, as the
case may be, and to increase or cause to be increased the principal
23
amount of the Regulation S Temporary Global Security by the aggregate
principal amount of the beneficial interest in the Rule 144A Global
Security or the IAI Global Security, as the case may be, equal to the
beneficial interest in the Regulation S Temporary Global Security to
be exchanged or transferred, to credit or cause to be credited to the
account of the person specified in such instructions a beneficial
interest in the Regulation S Temporary Global Security equal to the
reduction in the principal amount of the Rule 144A Global Security or
the IAI Global Security, as the case may be, and to debit or cause to
be debited from the account of the person making such exchange or
transfer the beneficial interest in the Rule 144A Global Security or
the IAI Global Security as the case may be, that is being exchanged
or transferred.
(iii) Regulation S Temporary Global Security to Rule 144A Global
----------------------------------------------------------
Security or IAI Global Security. If an owner of a beneficial interest
-------------------------------
in the Regulation S Temporary Global Security deposited with the
Depositary or with the Trustee as custodian for the Depositary wishes
at any time to transfer its interest in such Regulation S Temporary
Global Security to a person who is required to take delivery thereof
in the form of an interest in the Rule 144A Global Security or,
subject to Section 2.06(a)(vii), in the IAI Global Security, such
holder may, subject to the rules and procedures of Euroclear or Cedel,
as the case may be, and the Depositary, exchange or cause the exchange
of such interest for an equivalent beneficial interest in the Rule
144A Global Security or in the IAI Global Security, as the case may
be. Upon receipt by the Trustee, as Registrar, at its office in The
City of New York of (1) instructions from Euroclear or Cedel, if
applicable, and the Depositary, directing the Trustee, as Registrar,
to credit or cause to be credited a beneficial interest in the Rule
144A Global Security or in the IAI Global Security, as the case may
be, equal to the beneficial interest in the Regulation S Temporary
Global Security to be exchanged or transferred, such instructions to
contain information regarding the participant account with the
Depositary to be credited with such increase, (2) a written order
given in accordance with the Depositary's procedures containing
information regarding the participant account of the Depositary and
(3) a certificate in the form of Exhibit D attached hereto given by
the owner of such beneficial interest, then Euroclear or Cedel or the
Trustee, as Registrar, as the case may be, will instruct the
Depositary to reduce or cause to be reduced the Regulation S Temporary
Global Security and to increase or cause to be increased the principal
amount of the Rule 144A Global Security or of the IAI Global Security,
as the case may be, by the aggregate principal amount of the
beneficial interest in the Regulation S Temporary Global Security to
be exchanged or transferred, and the Trustee, as Registrar, shall
instruct the Depositary, concurrently with such reduction, to credit
or cause to be credited to the account of the person specified in such
instructions a beneficial interest in the Rule 144A Global Security or
in the IAI Global Security, as the case may be, equal to the reduction
in the principal amount of the Regulation S Temporary Global Security
and to debit or cause to be debited from the account of the person
making such exchange or transfer the beneficial interest in the
Regulation S Temporary Global Security that is being exchanged or
transferred.
(iv) Global Security to Restricted Security. If an owner of a
--------------------------------------
beneficial interest in a Global Security deposited with the Depositary
or with the Trustee as custodian for the Depositary wishes at any time
to transfer its interest in such Global Security to a person who is
required to take delivery thereof in the form of a Restricted
Security, such owner may, subject to the rules and procedures of
Euroclear or Cedel, if applicable, and the
24
Depositary, cause the exchange of such interest for one or more
Restricted Securities of any authorized denomination or denominations
and of the same aggregate principal amount. Upon receipt by the
Trustee, as Registrar, at its office in The City of New York of (1)
instructions from Euroclear or Cedel, if applicable, and the
Depositary directing the Trustee, as Registrar, to authenticate and
deliver one or more Restricted Securities of the same aggregate
principal amount as the beneficial interest in the Global Security to
be exchanged, such instructions to contain the name or names of the
designated transferee or transferees, the authorized denomination or
denominations of the Restricted Securities to be so issued and
appropriate delivery instructions, (2) a certificate in the form of
Exhibit E attached hereto given by the owner of such beneficial
interest to the effect set forth therein, (3) a certificate in the
form of Exhibit F attached hereto given by the person acquiring the
Restricted Securities for which such interest is being exchanged, to
the effect set forth therein, and (4) such other certifications, legal
opinions or other information as the Company may reasonably require to
confirm that such transfer is being made pursuant to an exemption
from, or in a transaction not subject to, the registration
requirements of the Securities Act, then Euroclear or Cedel, if
applicable, or the Trustee, as Registrar, as the case may be, will
instruct the Depositary to reduce or cause to be reduced such Global
Security by the aggregate principal amount of the beneficial interest
therein to be exchanged and to debit or cause to be debited from the
account of the person making such transfer the beneficial interest in
the Global Security that is being transferred, and concurrently with
such reduction and debit the Company shall execute, and the Trustee
shall authenticate and deliver, one or more Restricted Securities of
the same aggregate principal amount in accordance with the
instructions referred to above.
(v) Restricted Security to Restricted Security. If a holder of a
------------------------------------------
Restricted Security wishes at any time to transfer such Restricted
Security to a person who is required to take delivery thereof in the
form of a Restricted Security, such holder may, subject to the
restrictions on transfer set forth herein and in such Restricted
Security, cause the exchange of such Restricted Security for one or
more Restricted Securities of any authorized denomination or
denominations and of the same aggregate principal amount. Upon
receipt by the Trustee, as Registrar, at its office in The City of New
York of (1) such Restricted Security, duly endorsed as provided
herein, (2) instructions from such holder directing the Trustee, as
Registrar, to authenticate and deliver one or more Restricted
Securities of the same aggregate principal amount as the Restricted
Security to be exchanged, such instructions to contain the name or
authorized denomination or denominations of the Restricted Securities
to be so issued and appropriate delivery instructions, (3) a
certificate from the holder of the Restricted Security to be exchanged
in the form of Exhibit E attached hereto, (4) a certificate in the
form of Exhibit F attached hereto given by the person acquiring the
Restricted Securities for which such interest is being exchanged, to
the effect set forth therein, and (5) such other certifications, legal
opinions or other information as the Company may reasonably require to
confirm that such transfer is being made pursuant to an exemption
from, or in a transaction not subject to, the registration
requirements of the Securities Act, then the Trustee, as Registrar,
shall cancel or cause to be cancelled such Restricted Security and
concurrently therewith, the Company shall execute, and the Trustee
shall authenticate and deliver, one or more Restricted Securities of
the same aggregate principal amount at maturity, in accordance with
the instructions referred to above.
25
(vi) Other Exchanges. In the event that a beneficial interest in a
---------------
Global Security is exchanged for Securities in definitive registered
form pursuant to Section 2.10, prior to the effectiveness of a Shelf
Registration Statement with respect to such Securities, such
Securities may be exchanged only in accordance with such procedures as
are substantially consistent with the provisions of clauses (ii)
through (v) above (including the certification requirements intended
to ensure that such transfers comply with Rule 144A, Rule 144, Rule
501(a)(1), (2), (3) or (7) of Regulation D, or Regulation S, as the
case may be) and such other procedures as may from time to time be
adopted by the Company.
(vii) Restricted Period. Prior to the termination of the "restricted
-----------------
period" (as defined in Regulation S) with respect to the issuance of
the Securities, transfers of interests in the Regulation S Temporary
Global Security to "U.S. persons" (as defined in Regulation S) shall
be limited to transfers to QIBs made pursuant to the provisions of
Sections 2.06(a)(iii). The Company shall advise the Trustee as to the
termination of the restricted period and the Trustee may rely
conclusively thereon.
(viii) Regulation S Temporary Global Security to Regulation S
------------------------------------------------------
Permanent Global Security. Following the termination of the
-------------------------
"restricted period" (as defined in Regulation S) with respect to the
issuance of the Securities, beneficial interests in the Regulation S
Temporary Global Security shall be exchanged for an interest in a
Global Security in definitive, fully registered form without interest
coupons, with the Global Securities Legend set forth in Exhibit A
hereto, but without the Restricted Securities Legend as set forth
therein (a "Regulation S Permanent Global Security"), pursuant to the
rules and procedures of the Depositary; provided, however, that prior
to (i) the payment of interest or principal with respect to a holder's
beneficial interest in the Regulation S Temporary Global Security and
(ii) any exchange of such beneficial interest for a beneficial
interest in the Regulation S Permanent Global Security, Euroclear or
Cedel shall receive a certificate substantially in the form of Exhibit
G hereto from the beneficial owner of such beneficial interest and
Euroclear and Cedel shall deliver a certificate substantially in the
form of Exhibit H hereto to the Trustee (or the paying agent if
different from the Trustee). Upon proper presentment to the Trustee
of a certificate substantially in the form of Exhibit I hereto and
subject to the rules and procedures of DTC or its direct or indirect
participants, including Euroclear and Cedel, an interest in a
Regulation S Permanent Global Security may be exchanged for a
certificated Security that is free from any restriction on transfer
(other than such as are solely attributable to any holder's status).
(b) Except in connection with a Registered Exchange Offer or a Shelf
Registration Statement contemplated by and in accordance with the terms of
the Registration Rights Agreement, if Initial Notes are issued upon the
transfer, exchange or replacement of Initial Notes bearing the Restricted
Securities Legend set forth in Exhibit A hereto, or if a request is made to
remove such Restricted Securities Legend on Initial Notes, the Initial
Notes so issued shall bear the Restricted Securities Legend, or the
Restricted Securities Legend shall not be removed, as the case may be,
unless there is delivered to the Company such satisfactory evidence, which
may include an opinion of counsel licensed to practice law in the State of
New York, as may be reasonably required by the Company, that neither the
legend nor the restrictions on transfer set forth therein are required to
ensure that transfers thereof comply with the provisions of Rule 144A, Rule
144, Rule 501(a) (1), (2), (3) or (7) of Regulation D or Regulation S under
the Securities Act or, with respect to Restricted Securities, that such
Securities are not "restricted"
26
within the meaning of Rule 144 under the Securities Act. Upon provision of
such satisfactory evidence, the Trustee, at the direction of the Company,
shall authenticate and deliver Initial Notes that do not bear the legend.
(c) Neither the Company nor the Trustee shall have any responsibility
for any actions taken or not taken by the Depositary and the Company shall
have no responsibility for any actions taken or not taken by the Trustee as
agent or custodian of the Depositary.
SECTION 2.07. Replacement Securities. If the holder of a Security
----------------------
claims that the Security has been lost, destroyed or wrongfully taken or if such
Security is mutilated and is surrendered to the Trustee, the Company shall issue
and the Trustee shall authenticate a replacement Security if the Trustee's and
the Company's requirements are met. If required by the Trustee or the Company,
an indemnity bond must be sufficient in the judgment of both to protect the
Company, the Trustee, any Agent or any authenticating agent from any loss which
any of them may suffer if a Security is replaced. The Company may charge for
its expenses in replacing a Security.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, or is about to be purchased by the
Company pursuant to Article III hereof, the Company in its discretion may,
instead of issuing a new Security, pay or purchase such Security, as the case
may be.
Every replacement Security is an additional obligation of the Company.
SECTION 2.08. Outstanding Securities. The Securities outstanding at
----------------------
any time are all the Securities authenticated by the Trustee except for those
canceled by it, those delivered to it for cancellation, and those described in
this Section as not outstanding.
If a Security is replaced, paid or purchased pursuant to Section 2.07
hereof, it ceases to be outstanding unless the Trustee receives proof
satisfactory to it that the replaced, paid or purchased Security is held by a
bona fide purchaser.
If Securities are considered paid under Section 4.01 hereof, they
cease to be outstanding and interest on them ceases to accrue.
A Security does not cease to be outstanding because the Company or an
Affiliate of the Company holds the Security.
SECTION 2.09. Treasury Securities. In determining whether the
-------------------
Noteholders of the required principal amount of Securities have concurred in any
direction, waiver or consent, Securities owned by the Company or an Affiliate of
the Company shall be considered as though they are not outstanding, except that
for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent, only Securities which the
Trustee knows are so owned shall be so disregarded.
SECTION 2.10. Temporary Securities. (a) Until definitive Securities
--------------------
are ready for delivery, the Company may prepare and the Trustee shall
authenticate temporary Securities. Temporary Securities shall be substantially
in the form of definitive Securities but may have variations that the
27
Company considers appropriate for temporary Securities. Without unreasonable
delay, the Company shall prepare and the Trustee shall authenticate definitive
Securities in exchange for temporary Securities.
(b) A Global Security deposited with the Depositary or with the
Trustee as custodian for the Depositary pursuant to Section 2.01 shall be
transferred to the beneficial owners thereof in the form of certificated
Securities only if such transfer complies with Section 2.06 and (i) the
Depositary notifies the Company that it is unwilling or unable to continue
as Depositary for such Global Security or if at any time such Depositary
ceases to be a "clearing agency" registered under the Exchange Act and a
successor depositary is not appointed by the Company within 90 days of such
notice, or (ii) an Event of Default has occurred and is continuing.
(c) Any Global Security that is transferable to the beneficial owners
thereof in the form of certificated Securities pursuant to this Section
2.10 shall be surrendered by the Depositary to the Trustee located in the
Borough of Manhattan, The City of New York, to be so transferred, in whole
or from time to time in part, without charge, and the Trustee shall
authenticate and deliver, upon such transfer of each portion of such Global
Security, an equal aggregate principal amount of Initial Notes of
authorized denominations in the form of certificated Securities. Any
portion of a Global Security transferred pursuant to this Section shall be
executed, authenticated and delivered only in denominations of $1,000 and
any integral multiple thereof and registered in such names as the
Depositary shall direct. Any Initial Note in the form of certificated
Securities delivered in exchange for an interest in the Global Securities
shall, except as otherwise provided by Section 2.06(b) bear the Restricted
Securities Legend set forth in Exhibit A hereto.
(d) The registered holder of a Global Security may grant proxies and
otherwise authorize any person, including Agent Members and persons that
may hold interests through Agent Members, to take any action which a holder
is entitled to take under this Indenture or the Securities.
(e) In the event of the occurrence of either of the events specified
in Section 2.10(b), the Company will promptly make available to the Trustee
a reasonable supply of certificated Securities in definitive, fully
registered form without interest coupons.
SECTION 2.11. Cancellation. The Company at any time may deliver
------------
Securities to the Trustee for cancellation. The Registrar and Paying Agent
shall forward to the Trustee any Securities surrendered to them for registration
of transfer, exchange or payment. The Trustee shall promptly cancel all
Securities surrendered for registration of transfer, exchange, payment,
replacement or cancellation and shall dispose of canceled Securities as the
Company directs. The Company may not issue new Securities to replace Securities
that it has paid or that have been delivered to the Trustee for cancellation.
SECTION 2.12. Defaulted Interest. If the Company fails to make a
------------------
payment of interest on the Securities, it shall pay such defaulted interest plus
any interest payable on the defaulted interest, in any lawful manner. It may
pay such defaulted interest, plus any such interest payable on it, to the
persons who are Noteholders on a subsequent special record date. The Company
shall fix any such record date and payment date. At least 15 days before any
such record date, the Company shall mail to Noteholders a notice that states the
record date, payment date, and amount of such interest to be paid.
28
ARTICLE III
Redemption
----------
SECTION 3.01. Notices to Trustee. If the Company elects to redeem
------------------
Securities pursuant to the optional redemption provisions of the Securities and
Section 3.07 hereof or pursuant to the Optional Tax Redemption provision of the
Securities (Section 8 of the Initial Notes and Section 7 of the Exchange Notes),
it shall notify the Trustee of the redemption date and the principal amount of
Securities to be redeemed and in connection with an Optional Tax Redemption as
provided in the Securities, such notice shall be accompanied by an Officers'
Certificate to the effect that the conditions to such redemption contained
herein have been complied with. The Company shall give each notice provided for
in this Section 3.01 at least 50 days before the redemption date (unless a
shorter notice period shall be satisfactory to the Trustee).
SECTION 3.02. Selection of Securities to Be Redeemed. If less than
--------------------------------------
all the Securities are to be redeemed, the Trustee shall select the Securities
to be redeemed pro rata or by lot or by a method that complies with the
requirements of any exchange on which the Securities are listed and that the
Trustee considers fair and appropriate. The Trustee shall make the selection
not more than 75 days and not less than 30 days before the redemption date from
Securities outstanding not previously called for redemption. The Trustee may
select for redemption portions of the principal of Securities that have
denominations larger than $1,000. Securities and portions of them it selects
shall be in amounts of $1,000 or integral multiples of $1,000. Provisions of
this Indenture that apply to Securities called for redemption also apply to
portions of Securities called for redemption. The Trustee shall notify the
Company promptly of the Securities or portions of Securities to be called for
redemption.
SECTION 3.03. Notice of Redemption. At least 30 days but not more
--------------------
than 60 days before a redemption date, the Company shall mail a notice of
redemption to each holder whose Securities are to be redeemed.
The notice shall identify the Securities to be redeemed and shall
state:
(a) the redemption date;
(b) the redemption price;
(c) if any Security is being redeemed in part, the portion of the
principal amount of such Security to be redeemed and that, after
the redemption date, upon surrender of such Security, a new
Security or Securities in principal amount equal to the
unredeemed portion will be issued;
(d) the name and address of the Paying Agent;
(e) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price plus accrued
interest;
(f) that interest on Securities called for redemption ceases to
accrue on and after the redemption date; and
29
(g) the paragraph of the Securities pursuant to which the Securities
called for redemption are being redeemed.
At the Company's request, the Trustee shall give notice of redemption
in the Company's name and at its expense.
SECTION 3.04. Effect of Notice of Redemption. Once notice of
------------------------------
redemption is mailed, Securities called for redemption become due and payable on
the redemption date at the price set forth in the Security.
SECTION 3.05. Deposit of Redemption Price. On or before the
---------------------------
redemption date, the Company shall deposit with the Trustee or with the Paying
Agent money sufficient to pay the redemption price of and accrued interest on
all Securities to be redeemed on that date. The Trustee or the Paying Agent
shall return to the Company any money not required for that purpose.
SECTION 3.06. Securities Redeemed in Part. Upon surrender of a
---------------------------
Security that is redeemed in part, the Company shall issue and the Trustee shall
authenticate for the holder at the expense of the Company a new Security equal
in principal amount to the unredeemed portion of the Security surrendered.
SECTION 3.07. Optional Redemption and Optional Tax Redemption. The
-----------------------------------------------
Company may redeem all or any portion of the Securities, upon the terms and at
the redemption prices set forth in each of the Securities. The Company may also
redeem all of the Securities in accordance with the Optional Tax Redemption
provision of the Securities (Section 8 of the Initial Notes and Section 7 of the
Exchange Notes). Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Section 3.01 through 3.07 hereof.
SECTION 3.08. Asset Sale Offer and Purchase Offer. (a) In the event
-----------------------------------
that, pursuant to Sections 4.10 or 4.13 hereof, the Company shall commence an
offer to all holders of the Securities to purchase Securities (the "Asset Sale
----------
Offer" or "Purchase Offer"), the Company shall follow the procedures in this
- ----- --------------
Section 3.08.
(b) The Asset Sale Offer or the Purchase Offer, as the case may be,
shall remain open for a period specified by the Company which shall be no less
than 30 calendar days and no more than 40 calendar days following its
commencement (the "Commencement Date") (as determined in accordance with Section
-----------------
4.10 or 4.13 hereof, as the case may be), except to the extent that a longer
period is required by applicable law (the "Tender Period"). Upon the expiration
-------------
of the Tender Period (the "Purchase Date"), the Company shall purchase the
-------------
principal amount of Securities required to be purchased pursuant to Section 4.10
or 4.13 hereof (the "Offer Amount") or, if less than the Offer Amount has been
------------
tendered, all Securities tendered in response to the Asset Sale Offer or the
Purchase Offer, as the case may be.
(c) If the Purchase Date is on or after an interest payment record
date and on or before the related interest payment date, any accrued interest
will be paid to the person in whose name a Security is registered at the close
of business on such record date, and no additional interest will be payable to
Noteholders who tender Securities pursuant to the Asset Sale Offer or the
Purchase Offer, as the case may be.
30
(d) The Company shall provide the Trustee with notice of the Asset
Sale Offer or the Purchase Offer, as the case may be, at least 10 days before
the Commencement Date.
(e) On or before the Commencement Date, the Company or the Trustee
(at the expense of the Company) shall send, by first class mail, a notice to
each of the Noteholders, which shall govern the terms of the Asset Sale Offer or
the Purchase Offer and shall state:
(i) that the Asset Sale Offer or the Purchase Offer is being made
pursuant to this Section 3.08 and, as applicable, Section 4.10 or 4.13
hereof and the length of time the Asset Sale Offer or the Purchase
Offer will remain open;
(ii) the Offer Amount, the purchase price (as determined in
accordance with Section 4.10 or 4.13 hereof) and the Purchase Date,
and in the case of a Purchase Offer made pursuant to Section 4.13
hereof, that all Securities tendered will be accepted for payment;
(iii) that any Security or portion thereof not tendered or accepted
for payment will continue to accrue interest;
(iv) that, unless the Company defaults in the payment of the purchase
price, any Security or portion thereof accepted for payment pursuant
to the Asset Sale Offer or the Purchase Offer shall cease to accrue
interest after the Purchase Date;
(v) that Noteholders electing to have a Security or portion thereof
purchased pursuant to any Asset Sale Offer or Purchase Offer will be
required to surrender the Security, with the form entitled "Option of
Noteholder to Elect Purchase" on the reverse of the Security
completed, to the Company, a depositary, if appointed by the Company,
or a Paying Agent at the address specified in the notice prior to the
close of business on the third Business Day preceding the Purchase
Date;
(vi) that Noteholders will be entitled to withdraw their election if
the Company, depositary or Paying Agent, as the case may be, receives,
not later than the close of business on the second Business Day
preceding the Purchase Date, or such longer period as may be required
by law, a letter or a telegram, telex or facsimile transmission
(receipt of which is confirmed and promptly followed by a letter)
setting forth the name of the Noteholder, the principal amount of the
Security or portion thereof the Noteholder delivered for purchase and
a statement that such Noteholder is withdrawing his election to have
the Security or portion thereof purchased;
(vii) that, if the aggregate principal amount of Securities
surrendered by Noteholders exceeds the Offer Amount (as defined in
Section 4.10 hereof), the Trustee shall select the Securities to be
purchased pro rata or by a method that complies with the requirements
of any exchange on which the Securities are listed and that the
Trustee considers fair and appropriate with such adjustments as may be
deemed appropriate by the Company so that only Securities in
denominations of $1,000, or integral multiples thereof, shall be
purchased; and
31
(viii) that Noteholders whose Securities were purchased only in part
will be issued new Securities equal in principal amount to the
unpurchased portion of the Securities surrendered.
In addition, the notice shall, to the extent permitted by applicable
law, be accompanied by a copy of the information regarding the Company and its
Subsidiaries which is required to be contained in the most recent Quarterly
Report on Form 10-Q or Annual Report on Form 10-K (including any financial
statements or other information required to be included or incorporated by
reference therein) and any Reports on Form 8-K filed since the date of such
Quarterly Report or Annual Report (or would have been required to file if the
Company remained a company incorporated in the United States), as the case may
be, which the Company has filed (or would have been required to file if it
remained a company incorporated in the United States) with the SEC on or prior
to the date of the notice. The notice shall contain all instructions and
materials necessary to enable such Noteholders to tender Securities pursuant to
the Asset Sale Offer or the Purchase Offer, as the case may be.
(f) At least one Business Day prior to the Purchase Date, the Company
shall irrevocably deposit with the Trustee or a Paying Agent in immediately
available funds an amount equal to the Offer Amount to be held for payment in
accordance with the terms of this Section. On the Purchase Date, the Company
shall, to the extent lawful, (i) accept for payment the Securities or portions
thereof tendered pursuant to the Asset Sale Offer or the Purchase Offer, (ii)
deliver or cause the depositary or Paying Agent to deliver to the Trustee
Securities so accepted and (iii) deliver to the Trustee an Officers' Certificate
stating such Securities or portions thereof have been accepted for payment by
the Company in accordance with the terms of this Section 3.08. The depositary,
the Paying Agent or the Company, as the case may be, shall promptly (but in any
case not later than ten (10) calendar days after the Purchase Date) mail or
deliver to each tendering Noteholder an amount equal to the purchase price of
the Securities tendered by such Noteholder and accepted by the Company for
purchase, and the Trustee shall promptly authenticate and mail or deliver to
such Noteholders 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 or on behalf of the Company to the holder
thereof. The Company will publicly announce in a newspaper of general
circulation the results of the Asset Sale Offer or the Purchase Offer on the
Purchase Date.
(g) The Asset Sale Offer or the Purchase Offer shall be made by the
Company in compliance with all applicable provisions of the Exchange Act, and
all applicable tender offer rules promulgated thereunder, and shall include all
instructions and materials necessary to enable such Noteholders to tender their
Securities.
ARTICLE IV
Covenants
---------
SECTION 4.01. Payment of Securities. The Company shall pay the
---------------------
principal of and interest on the Securities on the dates and in the manner
provided in the Securities. Principal and interest shall be considered paid on
the date due if the Paying Agent (other than the Company or an Affiliate of the
Company) holds on that date money designated for and sufficient to pay all
principal and interest then due. To the extent lawful, the Company shall pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on (i) overdue principal, at the rate borne by the Securities,
32
compounded semiannually; and (ii) overdue installments of interest (without
regard to any applicable grace period) at the same rate, compounded
semiannually.
SECTION 4.02. SEC Reports. Whether or not required by the rules and
-----------
regulations of the SEC, so long as any Securities are outstanding, the Company
will file with the SEC and furnish to the Trustee and to the holders of
Securities, all quarterly and annual financial information required to be
contained in a filing with the SEC on Forms 10-Q and 10-K (or the equivalent
thereof in the event the Company becomes a corporation organized under the laws
of England and Wales), including a "Management's Discussion and Analysis of
Results of Operations and Financial Condition" and, with respect to the annual
information only, a report thereon by the Company's certified independent
accountants, in each case, in the form required by the rules and regulations of
the SEC as in effect on the Issuance Date. This Section 4.02 will apply
notwithstanding that the Company becomes a corporation organized under the laws
of England and Wales.
SECTION 4.03. Compliance Certificate. The Company shall deliver to
----------------------
the Trustee, within 90 days after the end of each fiscal year of the Company, an
Officers' Certificate stating that a review of the activities of the Company and
its subsidiaries during the preceding fiscal year has been made under the
supervision of the signing Officers with a view to determining whether the
Company has kept, observed, performed and fulfilled its obligations under, and
complied with the covenants and conditions contained in, this Indenture, and
further stating, as to each such Officer signing such certificate, that to the
best of his knowledge the Company has kept, observed, performed and fulfilled
each and every covenant, and complied with the covenants and conditions
contained in this Indenture and is not in default in the performance or
observance of any of the terms, provisions and conditions hereof (or, if a
Default or Event of Default shall have occurred, describing all such Defaults or
Events of Default of which he may have knowledge) and that to the best of his
knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal or of interest, if any, on the Securities
are prohibited.
One of the Officers signing such Officers' Certificate shall be either
the Company's principal executive officer, principal financial officer or
principal accounting officer.
The Company will so long as any of the Securities are outstanding,
deliver to the Trustee, forthwith upon becoming aware of any Default or Event of
Default an Officers' Certificate specifying such Default or Event of Default.
Immediately upon the occurrence of any event giving rise to the
accrual of Special Interest (as such term is defined in Exhibit A hereto) or the
cessation of such accrual, the Company shall give the Trustee notice thereof and
of the event giving rise to such accrual or cessation (such notice to be
contained in an Officers' Certificate) and prior to receipt of such Officers'
Certificate the Trustee shall be entitled to assume that no such accrual has
commenced or ceased, as the case may be.
SECTION 4.04. Stay, Extension and Usury Laws. The Company covenants
------------------------------
(to the extent that it may lawfully do so) that it will not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this
Indenture; and the Company (to the extent it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not, by resort to any such law, hinder, delay or impede the execution
33
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.
SECTION 4.05. Corporate Existence. Subject to Article V hereof, the
-------------------
Company will do or cause to be done all things necessary to preserve and keep in
full force and effect its corporate existence and the corporate, partnership or
other existence of each subsidiary of the Company in accordance with the
respective organizational documents of each subsidiary and the rights (charter
and statutory), licenses and franchises of the Company and its subsidiaries;
provided, however, that the Company shall not be required to preserve any such
right, license or franchise, or the corporate, partnership or other existence of
any subsidiary, if the Board of Directors shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Company and
its subsidiaries taken as a whole and that the loss thereof is not adverse in
any material respect to the Noteholders. The Company shall notify the Trustee
in writing of any subsidiary which qualifies as a Material Subsidiary and is not
specified in clause (i) of the definition thereof.
SECTION 4.06. Taxes. The Company shall, and shall cause each of its
-----
subsidiaries to, pay prior to delinquency all taxes, assessments and
governmental levies, except as contested in good faith and by appropriate
proceedings.
SECTION 4.07. Limitations on Liens. Neither the Company nor any of
--------------------
its Restricted Subsidiaries may directly or indirectly create, incur, assume or
suffer to exist any Lien on any asset now owned or hereafter acquired, or any
income or profits therefrom or assign or convey any right to receive income
therefrom, except:
(a) Permitted Liens;
(b) Liens securing Indebtedness and related obligations to the extent
such Indebtedness and related obligations are permitted under Sections
4.08(b)(i), (ii) and (iii) hereof;
(c) Liens on the assets acquired or leased with the proceeds of
Indebtedness permitted to be incurred under Section 4.08 hereof; and
(d) Liens securing Refinancing Indebtedness permitted to be incurred
under Section 4.08 hereof; provided that the Refinancing Indebtedness so
issued and secured by such Lien shall not be secured by any property or
assets of the Company or any of its Subsidiaries other than the property or
assets subject to the Liens securing such Indebtedness being refinanced.
SECTION 4.08. Limitation on Indebtedness and Issuance of Preferred
----------------------------------------------------
Stock. (a) The Company will not, and will not permit any of its Subsidiaries to,
- -----
directly or indirectly, create, incur, issue, assume, guaranty or otherwise
become directly or indirectly liable with respect to (collectively, "incur") any
-----
Indebtedness (including Acquired Debt) and the Company will not issue any
Disqualified Stock and will not permit any of its Subsidiaries to issue any
shares of preferred stock; provided, however, that the Company may incur
Indebtedness or issue shares of Disqualified Stock and any of its Subsidiaries
may issue shares of preferred stock if after giving effect to such issuance or
incurrence on a pro forma basis, the sum of (x) Indebtedness of the Company and
its Subsidiaries, on a consolidated basis, (y) the liquidation value of
outstanding preferred stock of Subsidiaries and (z) the aggregate amount payable
by the Company and its Subsidiaries, on a consolidated basis, upon redemption of
Disqualified Stock to the extent such amount is not included in the preceding
clause (y), shall be less than the product of
34
Annualized Pro Forma EBITDA for the latest fiscal quarter for which internal
financial statements are available immediately preceding the date on which such
additional Indebtedness is incurred or such Disqualified Stock or preferred
stock is issued multiplied by 7.0, determined on a pro forma basis (including a
pro forma application of the net proceeds therefrom), as if the additional
Indebtedness had been incurred, or the Disqualified Stock or preferred stock had
been issued, as the case may be, at the beginning of such quarter.
(b) The foregoing limitations in Section 4.08(a) above will not apply
to:
(i) the issuance by any Subsidiary of preferred stock (other than
Disqualified Stock) to the Company, any Restricted Subsidiary of the
Company or the holders of Equity Interests in any Controlled
Subsidiary on a pro rata basis to such holders;
(ii) the incurrence of Indebtedness or the issuance of preferred
stock by the Company and its Subsidiaries if the proceeds of such
preferred stock or such Indebtedness are (or the credit support
provided by any such Indebtedness is) used to finance the construction
and working capital needs of a Cable Business (including, without
limitation, payments made pursuant to any License) or the acquisition
of Cable Assets or the Capital Stock of a Qualified Subsidiary;
(iii) the incurrence by the Company and its Subsidiaries of
additional Indebtedness in an aggregate principal amount not to exceed
$50 million;
(iv) the incurrence by the Company or any Subsidiary of the Company
of Indebtedness issued in exchange for, or the proceeds of which are
used to extend, refinance, renew, replace, or refund Existing
Indebtedness or Indebtedness referred to in clauses (i), (ii) or (iii)
above (the "Refinancing Indebtedness"); provided, however, that (1)
------------------------
the principal amount of, and any premium payable in respect of, such
Refinancing Indebtedness shall not exceed the principal amount of
Indebtedness so extended, refinanced, renewed, replaced or refunded
(plus the amount of reasonable expenses incurred in connection
therewith); (2) the Refinancing Indebtedness shall have (A) a Weighted
Average Life to Maturity equal to or greater than the Weighted Average
Life to Maturity of, and (B) a stated maturity no earlier than the
stated maturity of, the Indebtedness being extended, refinanced,
renewed, replaced or refunded; and (3) the Refinancing Indebtedness
shall be subordinated in right of payment to the Securities as and to
the extent of the Indebtedness being extended, refinanced, renewed,
replaced or refunded;
(v) the incurrence of Non-Recourse Debt by a Non-Restricted
Subsidiary;
(vi) the incurrence by the Company of Indebtedness represented by the
Subordinated Debentures (x) upon the exchange of the Preferred Stock
in accordance with the Certificate of Designation therefor or (y)
issued in lieu of payment of cash interest on the Subordinated
Debentures;
(vii) Indebtedness under Exchange Rate Contracts (the approval for
which is evidenced by a resolution of the Board of Directors set forth
in an Officers' Certificate delivered to the Trustee), provided that
such Exchange Rate Contracts are entered into in connection
35
with transactions entered into in the ordinary course of business and
hedge not more than the aggregate principal amount of the Securities
and the Deferred Coupon Notes;
(viii) Indebtedness under Interest Rate Agreements (the approval for
which is evidenced by a resolution of the Board of Directors set forth
in an Officers' Certificate delivered to the Trustee), provided that
the obligations under such agreements are related to payment
obligations on Existing Indebtedness or Indebtedness otherwise
permitted to be incurred pursuant to this paragraph;
(ix) the incurrence of Indebtedness between the Company and any
Controlled Subsidiary, between or among Controlled Subsidiaries and
between any Controlled Subsidiary and other holders of Equity
Interests of such Controlled Subsidiary (or other persons providing
funding on their behalf) on a pro rata basis and on substantially
identical principal financial terms, provided, however, that if any
such Controlled Subsidiary ceases to be a Controlled Subsidiary or
transfers such Indebtedness (other than to the Company or a Controlled
Subsidiary of the Company), such events shall be deemed, in each case,
to constitute the incurrence of such Indebtedness by the Company or by
a Controlled Subsidiary, as the case may be, at the time of such
event; and
(x) Indebtedness of the Company andor any Subsidiary in respect of
performance bonds of the Company or any Subsidiary or surety bonds
provided by the Company or any Subsidiary received in the ordinary
course of business in connection with the construction or operation of
a Cable Business.
SECTION 4.09. Limitation on Restricted Payments. (a) The Company will
---------------------------------
not, and will not permit any of its Restricted Subsidiaries to, directly or
indirectly:
(i) declare or pay any dividend or make any distribution on account
of the Company's or any of its Restricted Subsidiaries' Equity
Interests (other than (x) dividends or distributions payable in Equity
Interests (other than Disqualified Stock) of the Company or such
Subsidiary or (y) dividends or distributions payable to the Company or
any Wholly Owned Subsidiary of the Company, or (z) pro rata dividends
or pro rata distributions payable by a Restricted Subsidiary);
(ii) purchase, redeem or otherwise acquire or retire for value any
Equity Interests of the Company or any Restricted Subsidiary or other
Affiliate of the Company (other than any such Equity Interests owned
by the Company or any Wholly Owned Subsidiary of the Company);
(iii) voluntarily purchase, redeem or otherwise acquire or retire for
value any Indebtedness that is subordinated to the Securities; or
(iv) make any Restricted Investment (all such payments and other
actions set forth in clauses (i) through (iv) above being collectively
referred to as "Restricted Payments"), unless, at the time of such
Restricted Payment:
(1) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; and
36
(2) such Restricted Payment, together with the aggregate of all
other Restricted Payments made by the Company and its Restricted
Subsidiaries after the Issuance Date (including Restricted Payments
permitted by clauses (ii) through (ix) of the next succeeding
paragraph), is less than the sum of (x) the difference between
Cumulative EBITDA and 1.5 times Cumulative Interest Expense plus (y)
Capital Stock Sale Proceeds plus (z) cash received by the Company or a
Restricted Subsidiary from a Non-Restricted Subsidiary (other than
cash which is or is required to be repaid or returned to such Non-
Restricted Subsidiary); provided, however, that to the extent that any
Restricted Investment that was made after the date of the Indenture is
sold for cash or otherwise liquidated or repaid for cash, the amount
credited pursuant to this clause (z) shall be the lesser of (A) the
cash received with respect to such sale, liquidation or repayment of
such Restricted Investment (less the cost of such sale, liquidation or
repayment, if any) and (B) the initial amount of such Restricted
Investment .
(b) The foregoing provisions will not prohibit:
(i) the payment of any dividend within 60 days after the date of
declaration thereof, if at said date of declaration such payment would
have complied with the provisions of this Indenture;
(ii) (x) the redemption, repurchase, retirement or other acquisition
of any Equity Interests of the Company or any Restricted Subsidiary or
(y) an Investment in any person, in each case, in exchange for, or out
of the proceeds of, the substantially concurrent sale (other than to a
Restricted Subsidiary of the Company) of other Equity Interests (other
than any Disqualified Stock) of the Company; provided that the Company
delivers to the Trustee: (1) with respect to any transaction
involving in excess of $1 million, a resolution of the Board of
Directors set forth in an Officers' Certificate certifying that such
transaction is approved by a majority of the directors on the Board of
Directors; and (2) with respect to any transaction involving in excess
of $10 million, an opinion as to the fairness to the Company or such
Subsidiary from a financial point of view issued by an investment
banking firm of national standing with high yield experience, together
with an Officers' Certificate to the effect that such opinion complies
with this clause (2);
(iii) Investments by the Company or any Restricted Subsidiary in a
Non-Controlled Subsidiary which (A) has no Indebtedness on a
consolidated basis other than Indebtedness incurred to finance the
purchase of equipment used in a Cable Business, (B) has no
restrictions (other than restrictions imposed or permitted by the
Indenture or the indentures governing the Other Qualified Notes or the
Applicable Notes or any other instrument governing unsecured
indebtedness of the Company which is pari passu with the Securities)
on its ability to pay dividends or make any other distributions to the
Company or any of its Restricted Subsidiaries, (C) is or will be a
Cable Business and (D) uses the proceeds of such Investment for
constructing a Cable Business or the working capital needs of a Cable
Business;
(iv) the redemption, purchase, defeasance, acquisition or retirement
of Indebtedness that is subordinated to the Securities (including
premium, if any, and accrued and unpaid interest) made by exchange
for, or out of the proceeds of, the substantially concurrent sale
(other than to a Restricted Subsidiary of the Company) of, (A) Equity
Interests of the
37
Company or (B) Refinancing Indebtedness permitted to be incurred under
Section 4.08 hereof;
(v) Investments by the Company or any Restricted Subsidiary in a Non-
Controlled Subsidiary which is or will be a Cable Business in an
amount not to exceed $80 million in the aggregate plus the sum of (x)
cash received by the Company or a Restricted Subsidiary from a Non-
Restricted Subsidiary (other than cash which is or is required to be
repaid or returned to such Non-Restricted Subsidiary) to the extent
such cash has not been utilized to permit Investments pursuant to (vi)
below and (y) Capital Stock Sale Proceeds (excluding the aggregate net
sale proceeds to be received upon conversion of the Convertible
Subordinated Notes) to the extent such Proceeds have not been utilized
to permit a Restricted Payment pursuant to clause (a)(2) in this
Section 4.09;
(vi) Investments by the Company or any Restricted Subsidiary in a
Controlled Subsidiary or Non-Controlled Subsidiary that is or will be
a Cable Related Business in an amount not to exceed $40 million plus
cash received by the Company or a Restricted Subsidiary from a Non-
Restricted Subsidiary (other than cash which is or is required to be
repaid or returned to such Non-Restricted Subsidiary) to the extent
such cash has not been utilized to permit Investments pursuant to
clause (v) above;
(vii) the extension by the Company or any Restricted Subsidiary of
trade credit to a Non-Restricted Subsidiary on usual and customary
terms in the ordinary course of business, provided that the aggregate
amount of such trade credit shall not exceed $10 million at any one
time outstanding;
(viii) the payment of cash dividends on the Preferred Stock accruing
on or after February 15, 2004 or any mandatory redemption or
repurchase of the Preferred Stock, in each case, in accordance with
the terms of the Certificate of Designation therefor; and
(ix) the exchange of all of the outstanding shares of Preferred Stock
for Subordinated Debentures in accordance with the terms of the
Certificate of Designation for the Preferred Stock.
(c) Any Investment in a Subsidiary that becomes a Non-Restricted
Subsidiary shall become a Restricted Payment made on such date in the amount of
the greater of (x) the book value of such Subsidiary on the date such Subsidiary
becomes a Non-Restricted Subsidiary and (y) the fair market value of such
Subsidiary on such date as determined (A) in good faith by the Board of
Directors of such Subsidiary if such fair market value is determined to be less
than $10 million and (B) by an investment banking firm of national standing with
high yield underwriting expertise if such fair market value is determined to be
in excess of $10 million.
(d) Not later than the date of making any Restricted Payment (other
than those referred to in subclause (vii) of Section 4.09(b)), the Company shall
deliver to the Trustee an Officers' Certificate stating that such Restricted
Payment is permitted and setting forth the basis upon which the calculations
required by this Section were computed, which calculations may be based upon the
Company's latest available financial statements.
38
SECTION 4.10. Asset Sales. (a) The Company will not, and will not
-----------
permit any of its Restricted Subsidiaries to cause, make or suffer to exist any
Asset Sale, unless:
(i) no Default exists or is continuing immediately prior to and after
giving effect to such Asset Sale;
(ii) the Company (or the Restricted Subsidiary, as the case may be)
receives consideration at the time of such Asset Sale at least equal
to the fair market value (evidenced by a resolution of the Board of
Directors set forth in an Officers' Certificate delivered to the
Trustee) of the assets sold or otherwise disposed of; and
(iii) (a) at least 80% of the consideration therefor received by the
Company or such Restricted Subsidiary is in the form of Cash
Equivalents or (b) the consideration therefor received by the Company
or such Restricted Subsidiary is Cable Assets, or Capital Stock in a
Qualified Subsidiary, the sole assets of which are Cable Assets, that
are determined in the resolution referred to in (ii) above to be
substantially comparable in type to the assets being sold or (c) the
Company or such Restricted Subsidiary receives Capital Stock in a
Cable Controlled Subsidiary (or an entity that will become a Cable
Controlled Subsidiary after giving effect to such transaction) as
consideration therefor, provided that the aggregate fair market value
measured at such time of Capital Stock so received, and still held
pursuant to all transactions under this clause (c), plus the aggregate
fair market value of Capital Stock, if any, retained after the
applicable 60 day period in all transactions under clause (d) below,
will be no more than the proceeds that would be received from the sale
of Equity Interests in a Cable Business (in which the Company has an
Equity Interest) representing 5% of the Company's Net Households
immediately prior to such transaction or (d) the Company or such
Restricted Subsidiary receives as consideration therefor, Capital
Stock in a company engaged in a Cable Business which is publicly
traded either in the United Kingdom or in the United States, provided
that (i) the aggregate fair market value measured at such time of
Capital Stock so received will be no more than the proceeds that would
be received from the sale of Equity Interests in a Cable Business (in
which the Company has an Equity Interest) representing 10% of the
Company's Net Households immediately prior to such transaction and
(ii) within 60 days of an Asset Sale pursuant to this clause (d), the
Company or such Restricted Subsidiary Monetizes an amount of such
Capital Stock having a fair market value equal to the difference
between (x) the aggregate fair market value measured at such time of
Capital Stock received and still held in all transactions pursuant to
this clause (d), plus the aggregate fair market value of Capital
Stock, if any, received and still held in all transactions under
clause (c) above, and (y) the proceeds that would be received from the
sale of Equity Interests in a Cable Business (in which the Company has
an Equity Interest) representing 5% of the Company's Net Households
immediately prior to such transaction; provided, however, that the
amount of (x) any liabilities (as shown on the Company's or such
Restricted Subsidiary's most recent balance sheet or in the notes
thereto), of the Company or any Restricted Subsidiary (other than
liabilities that are by their terms subordinated to the Securities)
that are assumed by the transferee of any such assets and (y) any
notes or other obligations received by the Company or any such
Restricted Subsidiary from such transferee that are immediately
converted by the Company or such Restricted Subsidiary into cash,
shall be deemed to be Cash Equivalents
39
(to the extent of the Cash Equivalents received in such conversion)
for purposes of this clause (iii).
For purposes of this Indenture, the phrase "comparable in type" shall
include, without limitation and irrespective of the asset being sold, a
Qualified Cable Asset.
(b) Within 360 days after any Asset Sale, the Company (or the
Restricted Subsidiary, as the case may be) will cause the Net Proceeds from such
Asset Sale:
(i) to be used to permanently reduce Indebtedness of a Restricted
Subsidiary; or
(ii) to be invested or reinvested in a Cable Controlled Property.
Any Net Proceeds from any Asset Sale that are not used or reinvested
as provided in the preceding sentence constitute "Excess Proceeds." When the
aggregate amount of Excess Proceeds exceeds $15 million, the Company will make
an offer (an "Asset Sale Offer") to all holders of Securities and Other
----------------
Qualified Notes to purchase the maximum principal amount of Securities and Other
Qualified Notes (determined on a pro rata basis according to the accreted value
or principal amount, as the case may be, of the Securities and the Other
Qualified Notes; provided, however, that the asset sale offer must be made first
to the holders of the Applicable Notes) that may be purchased out of the Excess
Proceeds, if any, remaining after the consummation of the aforementioned Asset
Sale Offer to the holders of the Applicable Notes (x) with respect to the Other
Qualified Notes, based on the terms set forth in the indenture related to each
issue of the Other Qualified Notes and (y) with respect to the Securities, at an
offer price in cash in an amount equal to 100% of the outstanding principal
amount thereof plus accrued and unpaid interest, if any, to the date fixed for
the closing of such offer, in accordance with the procedures set forth in
Section 3.08 hereof. To the extent that the aggregate principal amount or
accreted value, as the case may be, of Securities and Other Qualified Notes
tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, if
any, remaining after the consummation of any required asset sale offer to the
holders of the Applicable Notes, the Company may use such deficiency for general
corporate purposes. If the principal amount or aggregate accreted value, as the
case may be, of Securities and Other Qualified Notes surrendered by holders
thereof exceeds the amount of Excess Proceeds, if any, remaining after the
consummation of any required asset sale offer to the holders of the Applicable
Notes, then such remaining Excess Proceeds will be allocated pro rata according
to accreted value or principal amount, as the case may be, to the Securities
and each issue of the Other Qualified Notes and, the Trustee will select the
Securities to be purchased from the amount allocated to the Securities on the
basis set forth in Section 3.08(e) hereof. Upon completion of any required
asset sale offer to the holders of Applicable Notes and the completion of the
Asset Sale Offer to the holders of the Securities and the Other Qualified Notes,
the amount of Excess Proceeds will be reset at zero. No such Asset Sale Offer
to purchase the Securities and Other Qualified Notes shall be required to be
made by the Company pursuant to the foregoing provisions if there are no Excess
Proceeds remaining after the consummation of any required asset sale offer made
to holders of the Applicable Notes.
(c) Notwithstanding the provisions of Sections 4.10(a) and (b): the
Company and its Subsidiaries may:
(i) sell, lease, transfer, convey or otherwise dispose of assets or
property acquired after October 14, 1993, by the Company or any
Subsidiary in a sale-and-leaseback transaction so long as the proceeds
of such sale are immediately applied to permanently reduce
40
Indebtedness of a Restricted Subsidiary or if there is no such
Indebtedness or such proceeds exceed the amount of such Indebtedness
then such proceeds or excess proceeds are reinvested in a Cable
Controlled Property within 360 days after such sale, lease, transfer,
conveyance or disposition;
(ii)(x) swap or exchange assets or property with a Cable Controlled
Subsidiary or (y) issue, sell, lease, transfer, convey or otherwise
dispose of equity securities of any of the Company's Subsidiaries to a
Cable Controlled Subsidiary, in each of cases (x) and (y) so long as
(A) the ratio of Indebtedness to Annualized Pro Forma EBITDA of the
Company after such transaction is equal to or less than the ratio of
Indebtedness to Annualized Pro Forma EBITDA of the Company immediately
preceding such transaction provided, however, that if the ratio of
Indebtedness to Annualized Pro Forma EBITDA of the Company immediately
preceding such transaction is 6:1 or less, then the ratio of
Indebtedness to Annualized Pro Forma EBITDA of the Company may be 0.5
greater than such ratio immediately preceding such transaction and (B)
either (I) the assets so contributed consist solely of a license to
operate a Cable Business and the Net Households covered by all of the
licenses to operate cable and telephone systems held by the Company
and its Restricted Subsidiaries immediately after and giving effect to
such transaction equals or exceeds the number of Net Households
covered by all of the licenses to operate cable and telephone systems
held by the Company and its Restricted Subsidiaries immediately prior
to such transaction or (II) the assets so contributed consist solely
of Cable Assets and the value of the Capital Stock received,
immediately after and giving effect to such transaction, as determined
by an investment banking firm of recognized standing with knowledge of
the Cable Business, equals or exceeds the value of Cable Assets
exchanged for such Capital Stock;
(iii) sell or transfer Long DistanceMicrowave Assets so long as the
Net Proceeds of such sale or transfer are applied in accordance with
Section 4.10(b) of this Indenture; or
(iv) issue, sell, lease, transfer, convey or otherwise dispose of
Equity Interests in any Cable Controlled Subsidiary if (A) the only
consideration received therefor other than Cash Equivalents is Cable
Assets and (B) within 270 days of such disposition the Company or such
Subsidiary, as the case may be, commits to invest the cash (or Cash
Equivalents) proceeds therefrom in a Cable Controlled Property and
actually so invests such proceeds in a Cable Controlled Property
within 15 months of such disposition;
provided, however, that in connection with each transaction under clauses (ii)
and (iv) above, the Company delivers to the Trustee:
(1) with respect to any such transaction where the aggregate
value of all the consideration received by the Company and its
Subsidiaries exceeds $1 million or any series of such transactions
where the aggregate value of all the consideration so received exceeds
$1 million, a resolution of the Board of Directors set forth in an
Officers' Certificate certifying that such disposition is approved by
a majority of the disinterested directors on the Board of Directors,
and
(2) with respect to any such transaction or any series of such
transactions where the aggregate value of all the consideration
received by the Company and its Subsidiaries
41
exceeds $10 million, an opinion as to the fairness to the Company or
such Subsidiary from a financial point of view issued by an investment
banking firm of national standing with high yield experience together
with an Officers' Certificate to the effect that such opinion complies
with clause (2) of this proviso.
SECTION 4.11. Limitations on Transactions with Affiliates. (a) The
-------------------------------------------
Company will not, and will not permit any of its Restricted Subsidiaries to,
sell, lease, transfer or otherwise dispose of any of its properties or assets
to, or purchase any property or assets from, or enter into any contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each of the foregoing, an "Affiliate Transaction"), unless:
---------------------
(i) such Affiliate Transaction is on terms that are no less favorable
to the Company or the relevant Subsidiary than those that could have
been obtained in a comparable transaction by the Company or such
Subsidiary with an unrelated person, and
(ii) the Company delivers to the Trustee:
(1) with respect to any Affiliate Transaction involving
aggregate payments in excess of $1 million or any series of Affiliate
Transactions with an Affiliate involving aggregate payments in excess
of $1 million, a resolution of the Board of Directors set forth in an
Officers' Certificate certifying that such Affiliate Transaction
complies with clause (i) above and such Affiliate Transaction is
approved by a majority of the disinterested directors on the Board of
Directors; and
(2) with respect to any Affiliate Transaction involving
aggregate payments in excess of $10 million or any series of Affiliate
Transactions with an Affiliate involving aggregate payments in excess
of $10 million, an opinion as to the fairness to the Company or such
Subsidiary from a financial point of view issued by an investment
banking firm of national standing with high yield experience together
with an Officers' Certificate to the effect that such opinion complies
with this clause (2).
(b) Notwithstanding the provisions of subsection (a) of this Section
4.11, the following shall not be deemed to be Affiliate Transactions:
(i) any employment agreement entered into by the Company or any of
its Subsidiaries in the ordinary course of business and consistent
with the past practice of the Company or its predecessor or such
Subsidiary;
(ii) transactions between or among the Company andor its Restricted
Subsidiaries;
(iii) transactions permitted by the provisions of Section 4.09
hereof;
(iv) Liens permitted under Section 4.07 hereof which are granted by
the Company or any of its Subsidiaries to an unrelated person for the
benefit of the Company or any other Subsidiary of the Company;
(v) any transaction pursuant to an agreement in effect on the Issuance
Date; and
42
(vi) the incurrence of Indebtedness by a Controlled Subsidiary where
such Indebtedness is owed to the holders of the Equity Interests of
such Controlled Subsidiary on a pro rata basis and on substantially
identical principal financial terms.
SECTION 4.12. Limitations on Dividends and Other Payment Restrictions
-------------------------------------------------------
Affecting Subsidiaries. The Company will not, and will not permit any of its
- ----------------------
Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or
suffer to exist or become effective any encumbrance or restriction on the
ability of any Restricted Subsidiary to:
(a) (i) pay dividends or make any other distributions to the Company
or any of its Subsidiaries (A) on its Capital Stock or (B) with respect to
any other interest or participation in, or measured by, its profits, or
(ii) pay any indebtedness owed to the Company or any of its Subsidiaries,
or
(b) make loans or advances to the Company or any of its Subsidiaries,
or
(c) transfer any of its properties or assets to the Company or any of
its Subsidiaries,
except for such encumbrances or restrictions existing under or by reason of:
(i) Existing Indebtedness as in effect on the Issuance Date,
(ii) this Indenture and the Securities,
(iii) any agreement covering or relating to Indebtedness
permitted to be incurred under Section 4.08(b)(i), (b)(ii) or (b)(iii)
hereof, provided that the provisions of such agreement permit any
action referred to in clause (a) above in aggregate amounts sufficient
to enable the payment of interest and principal and mandatory
repurchases pursuant to the terms of this Indenture and the
Securities, but provided further that (x) any such agreement may
nevertheless encumber, prohibit or restrict any action referred to in
clause (a) above if an event of default under such agreement has
occurred and is continuing or would occur as a result of any such
action and (y) any such agreement may nevertheless contain
restrictions limiting the payment of dividends or the making of any
other distributions to all or a portion of excess cash flow (or any
similar formulation thereof) and subordination provisions governing
Indebtedness owed to the Company or any Restricted Subsidiary,
(iv) applicable law,
(v) any instrument governing Indebtedness or Capital Stock of a
person acquired by the Company or any of its Subsidiaries as in effect
at the time of such acquisition (except to the extent such
Indebtedness was incurred in connection with such acquisition), which
encumbrance or restriction is not applicable to any person, or the
properties or assets of any person, other than the person, or the
property or assets of the person, so acquired; provided that the
EBITDA of such person is not taken into account in determining whether
such acquisition was permitted by the terms of this Indenture,
43
(vi) customary nonassignment provisions in leases entered into
in the ordinary course of business and consistent with past practices,
(vii) customary provisions of joint venture or stockholder
agreements, provided that such provisions are determined by a
resolution of the Board of Directors to be, at the time of such
determination, customary for such agreements,
(viii) purchase money obligations for property acquired in the
ordinary course of business or
(ix) permitted Refinancing Indebtedness, provided that the
restrictions contained in the agreements governing such Refinancing
Indebtedness are no more restrictive than those contained in the
agreements governing the Indebtedness being refinanced.
SECTION 4.13. Change of Control. (a) Upon the occurrence of a Change
-----------------
of Control Triggering Event, each holder of Securities shall have the right, in
accordance with this Section 4.13 and Section 3.08 hereof, to require the
Company to repurchase all or any part (equal to $1,000 or an integral multiple
thereof) of such holder's Securities pursuant to the offer described in Section
3.08 hereof (the "Purchase Offer") at a purchase price equal to 101% of the
--------------
principal amount thereof plus accrued and unpaid interest thereon, if any, to
the date of purchase (the "Change of Control Payment").
-------------------------
(b) Within 40 days following any Change of Control Triggering Event,
the Company shall mail to each holder the notice provided by Section 3.08(e)(i).
SECTION 4.14. Payment of Additional Amounts. At least 10 days prior
-----------------------------
to the first date on which payment of principal and any premium or interest on
the Securities is to be made, and at least 10 days prior to any subsequent such
date if there has been any change with respect to the matters set forth in the
Officers' Certificate described in this Section 4.14, the Company will furnish
the Trustee and the Paying Agent, if other than the Trustee, with an Officers'
Certificate instructing the Trustee and the Paying Agent whether the Company is
obligated to pay Additional Amounts (as defined in Section 3 of the Initial
Notes or Section 2 of the Exchange Notes) with respect to such payment of
principal, or of any premium or interest on the Securities. If the Company will
be obligated to pay Additional Amounts with respect to such payment, then such
Officers' Certificate shall specify by country the amount, if any, required to
be withheld on such payments to such holders and the Company will pay to the
Trustee or the Paying Agent such Additional Amounts. The Company shall
indemnify the Trustee and the Paying Agent for, and hold them harmless against,
any loss, liability or expense reasonably incurred without negligence or bad
faith on their part arising out of or in connection with actions taken or
omitted by any of them in reliance on any Officers' Certificate furnished to
them pursuant to this Section 4.14.
Whenever in this Indenture there is mentioned, in any context, the
payment of principal (and premium, if any), Offer Amount, interest or any other
amount payable under or with respect to any Security such mention shall be
deemed to include mention of the payment of Additional Amounts provided for in
this Section 4.14 and Section 3 of the Initial Notes (or Section 2 of the
Exchange Notes) to the extent that, in such context, Additional Amounts are,
were or would be payable in respect thereof pursuant to the provisions of this
Section 4.14 and Section 3 of the Initial Notes (or Section 2 of the Exchange
Notes) and express mention of the payment of Additional Amounts (if applicable)
in any provisions hereof shall not be construed as excluding Additional Amounts
in those provisions hereof where such express mention is not made (if
applicable).
44
ARTICLE V
Successors
----------
SECTION 5.01. Merger, Consolidation or Sale of Assets. The Company
---------------------------------------
may not consolidate or merge with or into (whether or not the Company is the
surviving corporation), or sell, assign, transfer, lease, convey or otherwise
dispose of all or substantially all of its properties or assets in one or more
related transactions to, another corporation, person or entity unless:
(a) the Company is the surviving corporation or the entity or the
person formed by or surviving any such consolidation or merger (if other
than the Company) or to which such sale, assignment, transfer, lease,
conveyance or other disposition shall have been made is a corporation
organized or existing under the laws of England and Wales or of the United
States, any state thereof or the District of Columbia;
(b) the entity or person formed by or surviving any such
consolidation or merger (if other than the Company) or the entity or person
to which such sale, assignment, transfer, lease, conveyance or other
disposition will have been made assumes all the Obligations (including the
due and punctual payment of Additional Amounts if the surviving corporation
is a corporation organized or existing under the laws of England and Wales)
of the Company, pursuant to a supplemental indenture in a form reasonably
satisfactory to the Trustee, under the Securities and this Indenture;
(c) immediately after such transaction no Default or Event of Default
exists;
(d) the Company or any entity or person formed by or surviving any
such consolidation or merger, or to which such sale, assignment, transfer,
lease, conveyance or other disposition will have been made will have a
ratio of Indebtedness to Annualized Pro Forma EBITDA equal to or less than
the ratio of Indebtedness to Annualized Pro Forma EBITDA of the Company
immediately preceding the transaction, provided, however, that if the ratio
of Indebtedness to Annualized Pro Forma EBITDA of the Company immediately
preceding such transaction is 6:1 or less, then the ratio of Indebtedness
to Annualized Pro Forma EBITDA of the Company may be 0.5 greater than such
ratio immediately preceding such transaction; and
(e) such transaction would not result in the loss of any material
authorization or Material License of the Company or its Subsidiaries.
SECTION 5.02. Successor Corporation Substituted. Upon any
---------------------------------
consolidation or merger, or any sale, assignment, transfer, lease, conveyance or
other disposition of all or substantially all of the assets of the Company in
accordance with Section 5.01 hereof, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which such sale,
assignment, transfer, lease, conveyance or other disposition is made shall
succeed to, and be substituted for and may exercise every right and power of,
the Company under this Indenture with the same effect as if such successor
person has been named as the Company herein; provided, however, that the
predecessor Company in the case of a sale, assignment, transfer, lease,
conveyance or other disposition shall not be released from the obligation to pay
the principal of and interest on the Securities.
45
ARTICLE VI
Defaults and Remedies
---------------------
SECTION 6.01. Events of Default. An "Event of Default" occurs if:
-----------------
(a) the Company defaults in the payment of interest (and Additional
Amounts, if applicable) on any Security when the same becomes due and
payable and the Default continues for a period of 30 days after the date
due and payable;
(b) the Company defaults in the payment of the principal of any
Security when the same becomes due and payable at maturity, upon redemption
or otherwise;
(c) the Company or any Subsidiary thereof fails to observe or perform
any covenant or agreement contained in Section 4.08, 4.09, or 4.13 hereof;
(d) the Company or any Subsidiary thereof fails to observe or perform
any other covenant or agreement contained in this Indenture or the
Securities, required by any of them to be performed and the Default
continues for a period of 60 days after notice from the Trustee to the
Company or from the holders of 25% in aggregate principal amount of the
then outstanding Securities to the Company and the Trustee stating that
such notice is a "Notice of Default";
(e) default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any Restricted Subsidiary
(or the payment of which is guaranteed by the Company or any Restricted
Subsidiary), whether such Indebtedness or guarantee now exists or is
created after the Issuance Date, which default (i) is caused by a failure
to pay when due principal of or interest on such Indebtedness within the
grace period provided for in such Indebtedness (which failure continues
beyond any applicable grace period) (a "Payment Default") or (ii) results
---------------
in the acceleration of such Indebtedness prior to its express maturity and,
in each case, the principal amount of any such Indebtedness, together with
the principal amount of any other such Indebtedness under which there is a
Payment Default or the maturity of which has been so accelerated,
aggregates $5 million or more;
(f) a final judgment or final judgments (other than any judgment as
to which a reputable insurance company has accepted full liability) for the
payment of money are entered by a court or courts of competent jurisdiction
against the Company or any Restricted Subsidiary of the Company which
remains undischarged for a period (during which execution shall not be
effectively stayed) of 60 days, provided that the aggregate of all such
judgments exceeds $5 million;
(g) the Company or any Material Subsidiary pursuant to or within the
meaning of any Bankruptcy Law; (i) commences a voluntary case, (ii)
consents to the entry of an order for relief against it in an involuntary
case in which it is the debtor, (iii) consents to the appointment of a
Custodian of it or for all or substantially all of its property, (iv) makes
a general assignment for the benefit of its creditors, or (v) generally is
unable to pay its debts as the same become due;
46
(h) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that: (i) is for relief against the Company or any
Material Subsidiary in an involuntary case, (ii) appoints a Custodian of
the Company or any Material Subsidiary or for all or substantially all of
its property, or (iii) orders the liquidation of the Company or any
Material Subsidiary, and the order or decree remains unstayed and in effect
for 60 days; and
(i) the revocation of a Material License.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar
--------------
Federal, state or foreign law for the relief of debtors or the protection of
creditors. The term "Custodian" means any receiver, trustee, assignee,
---------
liquidator or similar official under any Bankruptcy Law.
SECTION 6.02. Acceleration. If an Event of Default (other than an
------------
Event of Default specified in clauses (g) and (h) of Section 6.01 hereof) occurs
and is continuing, the Trustee by notice to the Company, or the Noteholders of
at least 25% in principal amount of the then outstanding Securities by notice to
the Company and the Trustee, may declare all the Securities to be due and
payable. Upon such declaration, the principal of, premium, if any, and interest
on, the Securities shall be due and payable immediately. If an Event of Default
specified in clause (g) or (h) of Section 6.01 hereof occurs, such an amount
shall ipso facto become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Noteholder. The
Noteholders of a majority in principal amount of the then outstanding Securities
by notice to the Trustee may rescind an acceleration and its consequences if the
rescission would not conflict with any judgment or decree and if all existing
Events of Default have been cured or waived except nonpayment of principal or
interest that has become due solely because of the acceleration.
In the case of any Event of Default pursuant to the provisions of
Section 6.01 occurring by reason of any wilful action (or inaction) taken (or
not taken) by or on behalf of the Company with the intention of avoiding payment
of the premium that the Company would have had to pay if the Company then had
elected to redeem the Securities pursuant to Section 7 of the Initial Notes
(Section 6 in the case of the Exchange Notes), an equivalent premium shall, upon
demand of the Noteholders of at least 25% in principal amount of the then
outstanding Securities delivered to the Company and the Trustee, also become and
be immediately due and payable to the extent permitted by law, anything in this
Indenture or in the Securities contained to the contrary notwithstanding. If an
Event of Default occurs prior to February 15, 2002, by reason of any wilful
action (or inaction) taken (or not taken) by or on behalf of the Company with
the intention of avoiding the prohibition on redemption of the Securities prior
to February 15, 2002, pursuant to Section 7 of the Initial Notes (Section 6 in
the case of the Exchange Notes), then the premium payable for purposes of this
paragraph for each of the years beginning on February 15 of the years (February
12 in the case of 1997) set forth below shall, subject to the foregoing demand,
be as set forth in the following table expressed as a percentage of the amount
that would otherwise be due pursuant to this Section 6.02 hereof but for the
provisions of this sentence.
Year Percentage
---- ----------
1997 ................................................ 110.0%
1998 ................................................ 109.0%
1999 ................................................ 108.0%
2000 ................................................ 107.0%
2001 ................................................ 106.0%
47
SECTION 6.03. Other Remedies. If an Event of Default occurs and is
--------------
continuing, the Trustee may pursue any available remedy to collect the payment
of principal or interest on the Securities or to enforce the performance of any
provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Noteholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies
are cumulative to the extent permitted by law.
SECTION 6.04. Waiver of Past Defaults. The Noteholders of a majority
-----------------------
in principal amount of the then outstanding Securities by notice to the Trustee
may waive an existing Default or Event of Default and its consequences except a
continuing Default or Event of Default in the payment of the principal of or
interest on any Security. When a Default or Event of Default is waived, it is
cured and ceases; but no such waiver shall extend to any subsequent or other
Default or impair any right consequent thereon.
SECTION 6.05. Control by Majority. The Noteholders of a majority in
-------------------
principal amount of the then outstanding Securities may direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee
or exercising any trust or power conferred on it. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture, is
unduly prejudicial to the rights of other Noteholders, or would involve the
Trustee in personal liability.
SECTION 6.06. Limitation on Suits. A Noteholder may pursue a remedy
-------------------
with respect to this Indenture or the Securities only if:
(a) the Noteholder gives to the Trustee notice of a continuing Event
of Default;
(b) the Noteholders of at least 25% in principal amount of the then
outstanding Securities make a request to the Trustee to pursue the remedy;
(c) such Noteholder or Noteholders offer to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of indemnity; and
(e) during such 60-day period the Noteholders of a majority in
principal amount of the then outstanding Securities do not give the Trustee
a direction inconsistent with the request.
A Noteholder may not use this Indenture to prejudice the rights of
another Noteholder or to obtain a preference or priority over another
Noteholder.
SECTION 6.07. Rights of Noteholders to Receive Payment.
----------------------------------------
Notwithstanding any other provision of this Indenture, the right of any
Noteholder of a Security to receive payment of principal and interest on the
Security, on or after the respective due dates expressed in the Security, or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of the Noteholder
made pursuant to this Section.
48
SECTION 6.08. Collection Suit by Trustee. If an Event of Default
--------------------------
specified in Section 6.01 (a) or (b) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company for the whole amount of principal and interest remaining unpaid on the
Securities and interest on overdue principal and interest and such further
amount as shall be sufficient to cover the costs and, to the extent lawful,
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.09. Trustee May File Proofs of Claim. The Trustee may file
--------------------------------
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Noteholders allowed
in any judicial proceedings relative to the Company, its creditors or its
property. Nothing contained herein shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Noteholder any plan
of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Noteholder thereof, or to authorize the Trustee
to vote in respect of the claim of any Noteholder in any such proceeding.
SECTION 6.10. Priorities. If the Trustee collects any money pursuant
-----------
to this Article, it shall pay out the money in the following order:
First: to the Trustee for amounts due under Section 7.07 hereof;
-----
Second: to Noteholders for amounts due and unpaid on the Securities
------
for principal and interest (and Additional Amounts, if applicable),
ratably, without preference or priority of any kind, according to the
amounts due and payable on the Securities for principal and interest,
respectively; and
Third: to the Company.
-----
The Trustee may fix a record date and payment date for any payment to
Noteholders made pursuant to this Section.
SECTION 6.11. Undertaking for Costs. In any suit for the enforcement
---------------------
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as a Trustee, a court in its discretion
may require the filing by any party litigant in the suit of an undertaking to
pay the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant. This Section does not apply to a suit by the
Trustee, a suit by a holder pursuant to Section 6.07 hereof, or a suit by
Noteholders of more than 10% in principal amount of the then outstanding
Securities.
ARTICLE VII
Trustee
-------
SECTION 7.01. Duties of Trustee. (a) If an Event of Default has
-----------------
occurred and is continuing, the Trustee shall exercise such of the rights and
powers vested in it by this Indenture, and use the same degree of care and skill
in their exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.
49
(b) Except during the continuance of an Event of Default: (i) the
Trustee need perform only those duties that are specifically set forth in this
Indenture and no others and (ii) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the requirements of this Indenture.
However, the Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture and to confirm
the correctness of all mathematical computations.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own wilful
misconduct, except that: (i) this paragraph does not limit the effect of
paragraph (b) of this Section 7.01; (ii) the Trustee shall not be liable for any
error of judgment made in good faith by a Trust Officer, unless it is proved
that the Trustee was negligent in ascertaining the pertinent facts and (iii) the
Trustee shall not be liable with respect to any action it takes or omits to take
in good faith in accordance with a direction received by it pursuant to Section
6.05 hereof.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section 7.01.
(e) The Trustee may refuse to perform any duty or exercise any right
or power unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
SECTION 7.02. Rights of Trustee. (a) The Trustee may rely on any
-----------------
document believed by it to be genuine and to have been signed or presented by
the proper person. The Trustee need not investigate any fact or matter stated
in the document.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel, or both. The Trustee shall
not be liable for any action it takes or omits to take in good faith in reliance
on such Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its rights or
powers.
(e) The Trustee shall not be charged with knowledge of any Event of
Default under subsection (c), (d), (e), (f) or (i) of Section 6.01 or of the
identity of any Material Subsidiary referred to in clause (ii) of the definition
thereof unless either (1) a Trust Officer of the Trustee assigned to its
Corporate Trustee Administration Department shall have actual knowledge thereof,
or (2) the Trustee shall have received notice thereof in accordance with Section
10.02 hereof from the Company or any holder.
SECTION 7.03. Individual Rights of Trustee. The Trustee in its
----------------------------
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or
50
an Affiliate with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights. However, the Trustee is subject to
Sections 7.10 and 7.11 hereof.
SECTION 7.04. Trustee's Disclaimer. The Trustee makes no
--------------------
representation as to the validity or adequacy of this Indenture or the
Securities, it shall not be accountable for the Company's use of the proceeds
from the Securities, and it shall not be responsible for any statement of the
Company in the Indenture or any statement in the Securities other than its
authentication or for compliance by the Company with the Registration Rights
Agreement.
SECTION 7.05. Notice of Defaults. If a Default or Event of Default
------------------
occurs and is continuing and if it is known to the Trustee, the Trustee shall
mail to Noteholders a notice of the Default or Event of Default within 90 days
after it occurs. Except in the case of a Default or Event of Default in payment
on any Security, the Trustee may withhold the notice if and so long as a
committee of its Trust Officers in good faith determines that withholding the
notice is in the interests of Noteholders.
SECTION 7.06. Reports by Trustee to Noteholders. Within 60 days after
---------------------------------
the reporting date stated in Section 10.10, the Trustee shall mail to
Noteholders a brief report dated as of such reporting date that complies with
TIA (S) 313(a) if and to the extent required by such (S) 313(a). The Trustee
also shall comply with TIA (S) 313(b)(2). The Trustee shall also transmit by
mail all reports as required by TIA (S) 313(c).
A copy of each report at the time of its mailing to Noteholders shall
be filed with the SEC and each stock exchange on which the Securities are
listed. The Company shall notify the Trustee when the Securities are listed on
any stock exchange.
SECTION 7.07. Compensation and Indemnity. The Company shall pay to
--------------------------
the Trustee from time to time reasonable compensation for its services
hereunder. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company shall reimburse the
Trustee upon request for all reasonable disbursements, expenses and advances
incurred or made by it. Such disbursements and expenses may include the
reasonable disbursements, compensation and expenses of the Trustee's agents and
counsel.
The Company shall indemnify the Trustee against any loss or liability
incurred by it except as set forth in the next paragraph. The Trustee shall
notify the Company promptly of any claim for which it may seek indemnity. The
Company shall defend the claim and the Trustee shall cooperate in the defense.
The Trustee may have separate counsel and the Company shall pay the reasonable
fees, disbursements and expenses of such counsel. The Company need not pay for
any settlement made without its consent, which consent shall not be unreasonably
withheld.
The Company need not reimburse any expense or indemnity against any
loss or liability incurred by the Trustee through negligence or bad faith.
To secure the Company's payment obligations in this Section, the
Trustee shall have a lien prior to the Securities on all money or property held
or collected by the Trustee, except money or property held in trust to pay
principal and interest on particular Securities.
51
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(g) or (h) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
SECTION 7.08. Replacement of Trustee. A resignation or removal of the
----------------------
Trustee and appointment of a successor Trustee shall become effective only upon
the successor Trustee's acceptance of appointment as provided in this Section.
The Trustee may resign by so notifying the Company. The Noteholders
of a majority in principal amount of the then outstanding Securities may remove
the Trustee by so notifying the Trustee and the Company. The Company may remove
the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof, unless the
Trustee's duty to resign is stayed as provided in TIA (S) 310(b);
(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a Custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the
Noteholders of a majority in principal amount of the then outstanding Securities
may appoint a successor Trustee to replace the successor Trustee appointed by
the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Noteholders of at least 10% in principal amount of the then outstanding
Securities may petition any court of competent jurisdiction for the appointment
of a successor Trustee.
If the Trustee fails to comply with Section 7.10 hereof, unless the
Trustee's duty to resign is stayed as provided in TIA (S) 310(b), any Noteholder
who has been a bona fide holder of a Security for at least six months may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Noteholders. The retiring Trustee shall promptly transfer all
property held by it as Trustee to the successor Trustee, subject to the lien
provided for in Section 7.07 hereof. Notwithstanding replacement of the Trustee
pursuant to this Section 7.08 hereof, the Company's obligations under Section
7.07 hereof shall continue for the benefit of the retiring trustee with respect
to expenses and liabilities incurred by it prior to such replacement.
52
SECTION 7.09. Successor Trustee by Merger, Etc. If the Trustee
--------------------------------
consolidates, merges or converts into, or transfers all or substantially all of
its corporate trust business to, another corporation, the successor corporation
without any further act shall be the successor Trustee.
SECTION 7.10. Eligibility; Disqualification. This Indenture shall
-----------------------------
always have a Trustee who satisfies the requirements of TIA (S) 310(a)(1) and
(5). The Trustee shall always have a combined capital and surplus as stated in
Section 10.10 hereof. The Trustee is subject to TIA (S) 310(b). The following
indentures shall be deemed to be specifically described herein for the purposes
of clause (i) of the first proviso contained in TIA (S) 310(b): (a) indenture
dated as of October 14, 1993, between the Company and The Chase Manhattan Bank
(formerly known as Chemical Bank), as trustee, relating to the Applicable Notes,
as amended, (b) indenture dated as of April 20, 1995 between the Company and The
Chase Manhattan Bank, as trustee, relating to the 12 34% Notes, as amended, and
(c) indenture dated as of January 30, 1996 between the Company and The Chase
Manhattan Bank, as trustee, relating to the 11 12% Notes.
SECTION 7.11. Preferential Collection of Claims Against Company. The
-------------------------------------------------
Trustee is subject to TIA (S) 311(a), excluding any creditor relationship listed
in TIA (S) 311(b). A Trustee who has resigned or been removed shall be subject
to TIA (S) 311(a) to the extent indicated therein.
ARTICLE VIII
Discharge of Indenture
----------------------
SECTION 8.01. Termination of Company's Obligations. This Indenture
------------------------------------
shall cease to be of further effect (except that the Company's obligations under
Sections 7.07 and 8.03 hereof shall survive) when all outstanding Securities
theretofore authenticated and issued have been delivered to the Trustee for
cancellation and the Company has paid all sums payable hereunder.
SECTION 8.02. Option to Effect Defeasance. The Company may, at the
---------------------------
option of its Board of Directors evidenced by a resolution set forth in an
Officers' Certificate, at any time, elect to have this Section 8.02 be applied
to all outstanding Securities upon compliance with the conditions set forth
below in this Section. Upon the Company's election to have this Section 8.02
apply to all the outstanding Securities, the Company shall, subject to the
satisfaction of the conditions set forth in the next paragraph, be deemed to
have been discharged from its obligations with respect to all outstanding
Securities on the date such conditions are satisfied (hereinafter,
"Defeasance"). For this purpose, Defeasance means that the Company shall be
----------
deemed to have paid and discharged the entire Obligations represented by the
outstanding Securities, which shall thereafter be deemed to be "outstanding"
only for the purposes of Section 8.03 hereof and the other Sections of this
Indenture referred to in clauses (a) and (b) below, and to have satisfied all
its other obligations under such Securities and this Indenture (and the Trustee,
on demand of and at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (a) the rights of holders
of outstanding Securities to receive solely from the trust fund described in the
following paragraph, 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 Securities under Article II hereof, (c) the
rights, powers, trusts, duties and immunities of the Trustee hereunder and the
Company's obligations in connection therewith, and (d) this Article VIII.
53
In order to exercise Defeasance:
(a) the Company must irrevocably deposit with the Trustee, in trust,
for the benefit of the holders, pursuant to an irrevocable trust and
security agreement in form satisfactory to the Trustee, money or U.S.
Government Obligations or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of independent
public accountants, expressed in a written certification thereof (in form
satisfactory to the Trustee) to pay the principal of, premium, if any, and
interest on the outstanding Securities on the stated date for payment
thereof or on the applicable redemption date, as the case may be, of such
principal or installment of principal of, premium, if any, and interest on
the outstanding Securities;
(b) the Company shall have delivered to the Trustee, an Opinion of
Counsel (which counsel may be an employee of the Company) reasonably
acceptable to the Trustee confirming that: (A) the Company has received
from, or there has been published by, the Internal Revenue Service a ruling
or (B) since the Issuance Date, there has been a change in the applicable
federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the holders of the
outstanding 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) no Event of Default shall have occurred and be continuing on the
date of such Defeasance (other than an Event of Default resulting from or
related to the incurrence of Indebtedness, the proceeds of which are to be
applied to such deposit) or, insofar as Sections 6.01 (g) and (h) hereof
are concerned, at any time in the period ending on the 91st day after the
date of deposit (or greater period of time in which any such deposit of
trust funds may remain subject to Bankruptcy Law insofar as those apply to
the deposit by the Company);
(d) such Defeasance shall not result in a breach or violation of, or
constitute a default under, any material agreement or instrument (other
than this Indenture) to which the Company or any of its Subsidiaries is a
party or by which the Company or any of its Subsidiaries is bound;
(e) the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that after the 91st day following the deposit (or
such greater period referred to in (c) above), the trust funds will not be
subject to the effect of any applicable Bankruptcy Law;
(f) 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 Securities over any other creditors of
the Company with the intent of defeating, hindering, delaying or defrauding
creditors of the Company or others;
(g) the deposit shall not result in the Company, the Trustee or the
trust fund established pursuant to (a) above being subject to regulation
under the Investment Company Act of 1940, as amended;
(h) holders of the Securities will have a valid, perfected and
unavoidable (under applicable Bankruptcy Law), subject to the passage of
time referred to clause (e) above, first priority security interest in the
trust funds; and
54
(i) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel (subject to customary exceptions),
each stating that all conditions precedent provided for or relating to the
Defeasance have been complied with.
"U.S. Government Obligations" means direct obligations of the United
---------------------------
States of America for the payment of which the full faith and credit of the
United States of America is pledged. In order to have money available on a
payment date to pay principal or interest (including Additional Amounts, if
applicable) on the Securities, the U.S. Government Obligations shall be payable
as to principal or interest on or before such payment date in such amounts as
will provide the necessary money. U.S. Government Obligations shall not be
callable at the issuer's option.
SECTION 8.03. Application of Trust Money. The Trustee shall hold in
--------------------------
trust money or U.S. Government Obligations deposited with it pursuant to Section
8.02 hereof. It shall apply the deposited money and the money from U.S.
Government Obligations through the Paying Agent and in accordance with this
Indenture to the payment of principal and interest on the Securities.
SECTION 8.04. Repayment to Company. The Trustee and the Paying Agent
--------------------
shall promptly pay to the Company upon request any excess money or securities
held by them at any time.
The Trustee and the Paying Agent shall pay to the Company upon request
any money held by them for the payment of principal or interest that remains
unclaimed for two years after the date upon which such payment shall have become
due; provided, however, that the Company shall have first caused notice of such
payment to the Company to be mailed to each Noteholder entitled thereto no less
than 30 days prior to such payment. After payment to the Company, the Trustee
and the Paying Agent shall have no further liability with respect to such money
and Noteholders entitled to the money must look to the Company for payment as
general creditors unless any applicable abandoned property law designates
another person.
SECTION 8.05. Reinstatement. If (i) the Trustee or Paying Agent is
-------------
unable to apply any money in accordance with Section 8.03 hereof by reason of
any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application and (ii) the Noteholders
of at least a majority in principal amount of the then outstanding Securities so
request by written notice to the Trustee, the Company's obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to Section 8.02 hereof until such time as the
Trustee or Paying Agent is permitted to apply all such money in accordance with
Section 8.03 hereof or such request is revoked by such Noteholders; provided,
however, that if the Company makes any payment of interest on or principal of
any Security following the reinstatement of its obligations, the Company shall
be subrogated to the rights of the Noteholders of such Securities to receive
such payment from the money held by the Trustee or Paying Agent.
ARTICLE IX
Amendments, Supplements and Waivers
-----------------------------------
SECTION 9.01. Without Consent of Noteholders. The Company and the
------------------------------
Trustee may amend or supplement this Indenture or the Securities without the
consent of any Noteholder:
55
(a) to cure any ambiguity, defect or inconsistency;
(b) to comply with Section 5.01 hereof;
(c) to provide for uncertificated Securities in addition to or in
place of certificated Securities;
(d) to make any change that does not adversely affect the interests
hereunder of any Noteholder; or
(e) to qualify the Indenture under the TIA or to comply with the
requirements of the SEC in order to maintain the qualification of the
Indenture under the TIA.
SECTION 9.02. With Consent of Noteholders. Subject to Section 6.07
---------------------------
hereof, the Company and the Trustee may amend or supplement this Indenture or
the Securities with the written consent of the Noteholders of at least a
majority in principal amount of the then outstanding Securities. Subject to
Sections 6.04 and 6.07 hereof, the Noteholders of a majority in principal amount
of the Securities then outstanding may also waive compliance in a particular
instance by the Company with any provision of this Indenture or the Securities.
However, without the consent of each Noteholder affected, an amendment,
supplement or waiver under this Section may not:
(a) reduce the amount of Securities whose Noteholders must consent to
an amendment, supplement or waiver;
(b) reduce the rate of or change the time for payment of interest on
any Security;
(c) reduce the principal of or change the fixed maturity of any
Security, or alter the provisions of Sections 7 and 8 of the Initial Note
and Sections 6 and 7 of the Exchange Note;
(d) make any Security payable in money other than that stated in the
Security;
(e) make any change in Section 6.04, 6.07 or 9.02 hereof (this
sentence); or
(f) waive a default in the payment of the principal of, or interest
on, any Security.
To secure a consent of the Noteholders under this Section 9.02, it
shall not be necessary for the Noteholders to approve the particular form of any
proposed amendment, supplement or waiver, but it shall be sufficient if such
consent approves the substance thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to Noteholders a notice briefly describing the
amendment or waiver.
SECTION 9.03. Compliance with Trust Indenture Act. Every amendment to
-----------------------------------
this Indenture or the Securities shall be set forth in a supplemental indenture
that complies with the TIA as then in effect.
SECTION 9.04. Revocation and Effect of Consents. Until an amendment,
---------------------------------
supplement or waiver becomes effective, a consent to it by a Noteholder of a
Security is a continuing consent by the
56
Noteholder and every subsequent Noteholder of a Security or portion of a
Security that evidences the same debt as the consenting Noteholder's Security,
even if notation of the consent is not made on any Security. However, any such
Noteholder or subsequent Noteholder may revoke the consent as to his Security or
portion of a Security if the Trustee receives the notice of revocation before
the date on which the Trustee receives an Officers' Certificate certifying that
the Noteholders of the requisite principal amount of Securities have consented
to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Noteholders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then notwithstanding the
provisions of the immediately preceding paragraph, those persons who were
Noteholders at such record date (or their duly designated proxies), and only
those persons, shall be entitled to consent to such amendment, supplement or
waiver or to revoke any consent previously given, whether or not such persons
continue to be Noteholders after such record date. No consent shall be valid or
effective for more than 90 days after such record date unless consents from
Noteholders of the principal amount of Securities required hereunder for such
amendment or waiver to be effective shall have also been given and not revoked
within such 90-day period.
After an amendment, supplement or waiver becomes effective it shall
bind every Noteholder, unless it is of the type described in any of clauses (a)
through (f) of Section 9.02 hereof. In such case, the amendment or waiver shall
bind each Noteholder who has consented to it and every subsequent Noteholder
that evidences the same debt as the consenting Noteholder's Security.
SECTION 9.05. Notation on or Exchange of Securities. The Trustee may
-------------------------------------
place an appropriate notation about an amendment or waiver on any Security
thereafter authenticated. The Company in exchange for all Securities may issue
and the Trustee shall authenticate new Securities that reflect the amendment or
waiver.
SECTION 9.06. Trustee Protected. The Trustee shall sign all
-----------------
supplemental indentures, except that the Trustee may, but need not, sign any
supplemental indenture that adversely affects its rights.
ARTICLE X
Miscellaneous
-------------
SECTION 10.01. Trust Indenture Act Controls. This Indenture is
----------------------------
subject to the provisions of the TIA that are required to be incorporated into
this Indenture (or, prior to the registration of the Securities pursuant to the
Registration Rights Agreement, would be required to be incorporated into this
Indenture if it were qualified under the TIA), and shall, to the extent
applicable, be governed by such provisions. If any provision of this Indenture
limits, qualifies, or conflicts with another provision which is required (or
would be so required) to be incorporated in this Indenture by the TIA, the
incorporated provision shall control.
SECTION 10.02. Notices. Any notice or communication by the Company or
-------
the Trustee to the other is duly given if in writing and delivered in person or
mailed by first-class mail to the other's address stated in Section 10.10
hereof. The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
57
Any notice or communication to a Noteholder shall be mailed by first-
class mail to his address shown on the register kept by the Registrar. Failure
to mail a notice or communication to a Noteholder or any defect in it shall not
affect its sufficiency with respect to other Noteholders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Noteholders, it
shall mail a copy to the Trustee and each Agent at the same time.
All other notices or communications shall be in writing.
In case by reason of the suspension of regular mail service, or by
reason of any other cause, it shall be impossible to mail any notice as required
by the Indenture, then such method of notification as shall be made with the
approval of the Trustee shall constitute a sufficient mailing of such notice.
SECTION 10.03. Communication by Noteholders with Other Noteholders.
---------------------------------------------------
Noteholders may communicate pursuant to TIA (S) 312(b) with other Noteholders
with respect to their rights under this Indenture or the Securities. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA (S) 312(c).
SECTION 10.04. Certificate and Opinion as to Conditions Precedent.
--------------------------------------------------
Upon any request or application by the Company to the Trustee to take any action
under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(b) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
SECTION 10.05. Statements Required in Certificate or Opinion. Each
---------------------------------------------
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture (other than pursuant to Section 4.03) shall
include:
(a) a statement that the person signing such certificate or rendering
such opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such person, such person has
made such examination or investigation as is necessary to enable such
person to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
58
(d) a statement as to whether or not, in the opinion of such person,
such condition or covenant has been complied with.
SECTION 10.06. Rules by Trustee and Agents. The Trustee may make
---------------------------
reasonable rules for action by, or a meeting of, Noteholders. The Registrar or
Paying Agent may make reasonable rules and set reasonable requirements for its
functions.
SECTION 10.07. Legal Holidays. A "Legal Holiday" is a Saturday, a
--------------
Sunday or a day on which banking institutions in the State of New York are not
required to be open. If a payment date is a Legal Holiday at a place of
payment, payment may be made at that place on the next succeeding day that is
not a Legal Holiday, and no interest shall accrue for the intervening period.
If any other operative date for purposes of this Indenture shall occur on a
Legal Holiday then for all purposes the next succeeding day that is not a Legal
Holiday shall be such operative date.
SECTION 10.08. No Recourse Against Others. A director, officer,
--------------------------
employee or stockholder, as such, of the Company shall not have any liability
for any obligations of the Company under the Securities or the Indenture or for
any claim based on, in respect of or by reason of such obligations or their
creation. Each Noteholder by accepting a Security waives and releases all such
liability. The waiver and release are part of the consideration for the issue
of the Securities.
SECTION 10.09. Counterparts. This Indenture may be executed in any
------------
number of counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
SECTION 10.10. Variable Provisions. "Officer" means the Chairman of
-------------------
the Board, the President, any Vice-President, the Treasurer, the Secretary, any
Assistant Treasurer or any Assistant Secretary of the Company.
The Company initially appoints the Trustee as Paying Agent, Registrar
and authenticating agent.
The first certificate pursuant to Section 4.03 hereof shall be for the
fiscal year ended on December 31, 1996.
The reporting date for Section 7.06 hereof is March 15 of each year.
The first reporting date is March 15, 1997.
The Trustee shall always have a combined capital and surplus of at
least $100,000,000 as set forth in its most recent published annual report of
condition.
The Company's address is:
International CableTel Incorporated
110 East 59th Street, 26th Floor
New York, New York 10022
Attention of: Richard J. Lubasch, Esq.
General Counsel
59
The Trustee's address is:
The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001
Attention: Corporate Trustee
Administration Department
SECTION 10.11. GOVERNING LAW. THE INTERNAL LAWS OF THE STATE OF NEW
-------------
YORK SHALL GOVERN THIS INDENTURE AND THE SECURITIES, WITHOUT REGARD TO THE
CONFLICT OF LAWS PROVISIONS THEREOF.
SECTION 10.12. No Adverse Interpretation of Other Agreements. This
---------------------------------------------
Indenture may not be used to interpret another indenture, loan or debt agreement
of the Company or an Affiliate. Any such indenture, loan or debt agreement may
not be used to interpret this Indenture.
SECTION 10.13. Successors. All agreements of the Company in this
----------
Indenture and the Securities shall bind its successor. All agreements of the
Trustee in this Indenture shall bind its successor.
SECTION 10.14. Severability. 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 10.15. Table of Contents, Headings, Etc. The Table of
--------------------------------
Contents, Cross-Reference Table, and headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not to
be considered a part hereof, and shall in no way modify or restrict any of the
terms or provisions hereof.
60
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the date first written above.
INTERNATIONAL CABLETEL
INCORPORATED, as Company
By: /s/ Richard J. Lubasch
-----------------------------
Name: Richard J. Lubasch
Title: Senior Vice President
THE CHASE MANHATTAN BANK,
as Trustee
By: /s/ Andrew M. Deck
-----------------------------
Name: Andrew M. Deck
Title: Senior Trust Officer
61
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
personally appeared before me, the undersigned authority in and for
the said county and state, on this 12th day of February, 1997, within my
jurisdiction, the within named Richard J. Lubasch acknowledged that he is Senior
Vice President of International CableTel Incorporated, a Delaware corporation,
and that for and on behalf of the said corporation, and as its act and deed he
executed the above and foregoing instrument, after first having been duly
authorized by said corporation so to do.
/s/ Maureen P. Murphy
---------------------
NOTARY PUBLIC
MAUREEN P. MURPHY
Notary Public, State of New York
No. 24-4798844
Qualified in Richmond County
Certificate Filed in New York County
Commission Expires March 30, 1997
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
personally appeared before me, the undersigned authority in and for
the said county and state, on this 12th day of February, 1997, within my
jurisdiction, the within named Andrew M. Deck, who acknowledged that he is a
Senior Trust Officer of The Chase Manhattan Bank, and that for and on behalf of
the said corporation, and as its act and deed he executed the above and
foregoing instrument, after first having been duly authorized by said
corporation so to do.
/s/ Maureen P. Murphy
---------------------
NOTARY PUBLIC
MAUREEN P. MURPHY
Notary Public, State of New York
No. 24-4798844
Qualified in Richmond County
Certificate Filed in New York County
Commission Expires March 30, 1997
62
EXHIBIT A
[FORM OF FACE OF INITIAL NOTE]
[Global Securities Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Restricted Securities Legend]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE THIRD ANNIVERSARY OF
THE ISSUANCE HEREOF (OR ANY PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER
THAT WAS AN AFFILIATE OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS
PRECEDING THE DATE OF SUCH TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE
COMPANY, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE
144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX CHECKED
BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
SECURITY), (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER
THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), AND, IF SUCH TRANSFER
IS BEING EFFECTED BY CERTAIN TRANSFERORS SPECIFIED IN THE INDENTURE (AS DEFINED
BELOW) PRIOR TO THE
63
EXPIRATION OF THE "40 DAY RESTRICTED PERIOD" (WITHIN THE MEANING OF RULE
903(c)(2) OF REGULATION S UNDER THE SECURITIES ACT), A CERTIFICATE THAT MAY BE
OBTAINED FROM THE COMPANY OR THE TRUSTEE IS DELIVERED BY THE TRANSFEREE TO THE
COMPANY AND THE TRUSTEE, (4) TO AN INSTITUTION THAT IS AN "ACCREDITED INVESTOR"
AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT (AS
INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON
THE REVERSE OF THIS SECURITY) THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT
PURPOSES AND NOT FOR DISTRIBUTION, AND A CERTIFICATE IN THE FORM ATTACHED TO THE
INDENTURE IS DELIVERED BY THE TRANSFEREE TO THE COMPANY AND THE TRUSTEE
(PROVIDED THAT CERTAIN HOLDERS SPECIFIED IN THE INDENTURE MAY NOT TRANSFER THIS
SECURITY PURSUANT TO THIS CLAUSE (4) PRIOR TO THE EXPIRATION OF THE "40 DAY
RESTRICTED PERIOD" (WITHIN THE MEANING OF RULE 903(c)(2) OF REGULATION S UNDER
THE SECURITIES ACT), (5) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT, OR
(6) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN
EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES. AN INSTITUTIONAL ACCREDITED INVESTOR HOLDING THIS SECURITY
AGREES IT WILL FURNISH TO THE COMPANY AND THE TRUSTEE SUCH CERTIFICATES AND
OTHER INFORMATION AS THEY MAY REASONABLY REQUIRE TO CONFIRM THAT ANY TRANSFER BY
IT OF THIS SECURITY COMPLIES WITH THE FOREGOING RESTRICTIONS. THE HOLDER
HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF
THE COMPANY THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A OR (2) AN INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN
RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT AND THAT IT IS HOLDING
THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR (3) A NON-U.S.
PERSON OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING
THE REQUIREMENTS OF PARAGRAPH (o)(2) OF RULE 902 UNDER) REGULATION S UNDER THE
SECURITIES ACT.
64
No. ________ $________
CUSIP No. [ ]/CINS No. [ ]
10% SENIOR NOTE DUE 2007
International CableTel Incorporated, a Delaware corporation (the
"Company"), promises to pay to __________________________ or registered assigns,
the principal sum of ____________________ Dollars $[ ] [,or
such other amount as is indicated on Schedule A hereof*/,] on February 15,
-
2007, subject to the further provisions of this Senior Note set forth on the
reverse hereof which further provisions shall for all purposes have the same
effect as if set forth at this place.
* Applicable to Global Securities only.
Interest Payment Dates: February 15 and August 15, commencing August 15, 1997.
Record Dates: February 1 and August 1
IN WITNESS WHEREOF, International CableTel Incorporated has caused
this Senior Note to be signed manually or by facsimile by its duly authorized
officers and a facsimile of its corporate seal to be affixed hereto or imprinted
hereon.
Dated: ______________
INTERNATIONAL CABLETEL
INCORPORATED
by
________________________________
[Seal]
by
________________________________
- -------------------------------
* Applicable to Global Securities only.
65
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 10% Senior
Notes Due 2007 described in the
within-mentioned Indenture.
THE CHASE MANHATTAN BANK, as Trustee
By:______________________________________
Authorized Officer
66
[FORM OF REVERSE OF INITIAL NOTE]
INTERNATIONAL CABLETEL INCORPORATED
10% Senior Note Due 2007
1. Interest. INTERNATIONAL CABLETEL INCORPORATED, a Delaware
corporation (the "Company"), is the issuer of 10% Senior Notes Due 2007 (the
"Senior Notes"). The Senior Notes will accrue interest at a rate of 10% per
annum. The Company promises to pay interest on the Senior Notes in cash
semiannually on each February 15 and August 15, commencing on August 15, 1997,
to holders of record on the immediately preceding February 1 and August 1,
respectively. Interest on the Senior Notes will accrue from the most recent
date to which interest has been paid, or if no interest has been paid, from
February 12, 1997. Interest will be computed on the basis of a 360-day year of
twelve 30-day months. The Company will pay interest on overdue principal at the
interest rate borne by the Senior Notes, compounded semiannually, and it shall
pay interest on overdue installments of interest (without regard to any
applicable grace period) at the same interest rate compounded semiannually. Any
interest paid on this Senior Note shall be increased to the extent necessary to
pay Additional Amounts as set forth in this Senior Note.
2. Special Interest. The holder of this Senior Note is entitled to
----------------
the benefits of the Registration Rights Agreement relating to the Senior Notes,
dated as of February 12, 1997, between the Company and the Initial Purchasers
(the "Registration Rights Agreement").
In the event that either (a) the Exchange Offer Registration Statement
(as such term is defined in the Registration Rights Agreement) is not filed with
the SEC on or prior to the 75th day following the date of original issuance of
the Senior Notes, (b) the Exchange Offer Registration Statement is not declared
effective prior to the 120th day following the date of original issuance of the
Senior Notes (as such period may be extended in accordance with the SEC review
delay provisions of the Registration Rights Agreement) or (c) the Registered
Exchange Offer (as such term is defined in the Registration Rights Agreement) is
not consummated or a Shelf Registration Statement (as such term is defined in
the Registration Rights Agreement) is not declared effective on or prior to the
160th day following the date of original issuance of the Senior Notes (as such
period may be extended in accordance with the SEC review delay provisions of the
Registration Rights Agreement) (each such event referred to in clauses (a)
through (c) above, a "Registration Default"), interest will accrue (in addition
to the stated interest on the Senior Notes) from and including the next day
following each of (i) such 75-day period in the case of clause (a) above and
(ii) such 120-day period in the case of clause (b) above and (iii) such 160-day
period in the case of clause (c) above (in each of cases (b) and (c) as such
period is extended, if applicable, in the manner aforesaid) (each such period
referred to in clauses (i)-(iii) above an "Accrual Period"), at a rate per annum
equal to 0.50% of the principal amount of the Senior Notes (determined daily).
The amount of such additional interest (the "Special Interest") will increase by
an additional 0.50% of the principal amount with respect to each subsequent
applicable Accrual Period until all Registration Defaults have been cured, up to
a maximum amount of Special Interest of 1.50% per annum of the principal amount
(determined daily). In each case such additional interest will be payable in
cash semiannually in arrears on each February 15 and August 15, commencing
August 15, 1997, to holders of record on the immediately preceding February 1
and August 1, respectively.
67
In the event that a Shelf Registration Statement is declared effective
pursuant to the terms of the Registration Rights Agreement, if the Company fails
to keep such Registration Statement continuously effective for the period
required by the Registration Rights Agreement, then from such time as the Shelf
Registration Statement is no longer effective until the earlier of (i) the date
that the Shelf Registration Statement is again deemed effective, (ii) the date
that is the third anniversary of the original issuance of the Senior Notes or
(iii) the date as of which all of the Senior Notes are sold pursuant to the
Shelf Registration Statement, Special Interest shall accrue at a rate per annum
equal to 0.50% of the principal amount of the Senior Notes (1.00% thereof if the
Shelf Registration Statement is no longer effective for 30 days or more) and
shall be payable in cash semiannually in arrears on each February 15 and August
15, commencing August 15, 1997, to the holders of record on the immediately
preceding February 1 and August 1, respectively.
3. Additional Amounts. This Section 3 will apply only in the event
------------------
that the Company becomes, or a successor to the Company is, a corporation
organized or existing under the laws of England and Wales. All payments made by
the Company on this Senior Note will be made without deduction or withholding,
for or on account of, any and all present or future taxes, duties, assessments,
or governmental charges of whatever nature unless the deduction or withholding
of such taxes, duties, assessments or governmental charges is then required by
law. If any deduction or withholding for or on account of any present or future
taxes, assessments or other governmental charges of the United Kingdom (or any
political subdivision or taxing authority thereof or therein) shall at any time
be required in respect of any amounts to be paid by the Company under this
Senior Note, the Company will pay or cause to be paid such additional amounts
("Additional Amounts") as may be necessary in order that the net amounts
received by a holder of this Senior Note after such deduction or withholding
shall be not less than the amounts specified in this Senior Note to which the
holder of this Senior Note is entitled; provided, however, that the Company
shall not be required to make any payment of Additional Amounts for or on
account of:
(a) any tax, assessment or other governmental charge to the extent
such tax, assessment or other governmental charge would not have been
imposed but for (i) the existence of any present or former connection
between such holder (or between a fiduciary, settlor, beneficiary, member
or shareholder of, or possessor of a power over, such holder, if such
holder is an estate, nominee, trust, partnership or corporation), other
than the holding of this Senior Note or the receipt of amounts payable in
respect of this Senior Note and the United Kingdom or any political
subdivision or taxing authority thereof or therein, including, without
limitation, such holder (or such fiduciary, settlor, beneficiary, member,
shareholder or possessor) being or having been a citizen or resident
thereof or being or having been present or engaged in trade or business
therein or having or having had a permanent establishment therein or (ii)
the presentation of this Senior Note (where presentation is required) for
payment on a date more than 30 days after the date on which such payment
became due and payable or the date on which payment thereof is duly
provided for, whichever occurs later, except to the extent that the holder
would have been entitled to Additional Amounts had this Senior Note been
presented on the last day of such period of 30 days;
(b) any tax, assessment or other governmental charge that is imposed
or withheld by reason of the failure to comply by the holder of this Senior
Note or, if different, the beneficial owner of the interest payable on this
Senior Note, with a timely request of the Company addressed to such holder
or beneficial owner to provide information, documents or other evidence
concerning the nationality, residence, identity or connection with the
taxing jurisdiction of such
68
holder or beneficial owner which is required or imposed by a statute,
regulation or administrative practice of the taxing jurisdiction as a
precondition to exemption from all or part of such tax, assessment or
governmental charge;
(c) any estate, inheritance, gift, sales, transfer, personal property
or similar tax, assessment or other governmental charge;
(d) any tax, assessment or other governmental charge which is
collectible otherwise than by withholding from payments of principal
amount, redemption amount, Change of Control Payment or interest with
respect to a Senior Note or withholding from the proceeds of a sale or
exchange of a Senior Note;
(e) any tax, assessment or other governmental charge required to be
withheld by any Paying Agent from any payment of principal amount,
redemption amount, Change of Control Payment or interest with respect to a
Senior Note, if such payment can be made without such withholding by any
other Paying Agent located inside the United States;
(f) any tax, assessment or other governmental charge imposed on a
holder that is not the beneficial owner of a Senior Note to the extent that
the beneficial owner would not have been entitled to the payment of any
such Additional Amounts had the beneficial owner directly held the Senior
Note;
(g) any combination of items (a), (b), (c), (d), (e) and (f) above;
nor shall Additional Amounts be paid with respect to any payment of the
principal of, or any interest on, this Senior Note to any holder who is a
fiduciary or partnership or other than the sole beneficial owner of such payment
to the extent that a beneficiary or settlor would not have been entitled to any
Additional Amounts had such beneficiary or settlor been the holder of this
Senior Note. All references to principal amount or interest on the Senior Notes
in the Indenture or the Senior Notes shall include any Additional Amounts
payable to the Company pursuant to this Section 3.
4. Method of Payment. The Company will pay interest on the Senior
-----------------
Notes (except defaulted interest) to the persons who are registered holders of
Senior Notes at the close of business on the record date for the next interest
payment date even though Senior Notes are canceled after the record date and on
or before the interest payment date. Noteholders must surrender Senior Notes to
a Paying Agent to collect principal payments. The Company will pay principal
and interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. However, the Company may pay
principal and interest by check payable in such money. It may mail an interest
check to a holder's registered address. If a holder so requests, principal and
interest may be paid by wire transfer of immediately available funds to an
account previously specified in writing by such holder to the Company and the
Trustee.
5. Paying Agent and Registrar. The Trustee will act as Paying Agent
--------------------------
and Registrar. The Company may change any Paying Agent, Registrar or co-
registrar without prior notice. The Company or any of its Affiliates may act in
any such capacity.
6. Indenture. The Company issued the Senior Notes under an
---------
Indenture, dated as of February 12th, 1997 (the "Indenture") between the Company
and The Chase Manhattan Bank, as
69
Trustee. The terms of the Senior Notes include those stated in the Indenture
and those made part of the Indenture by the Trust Indenture Act of 1939 (15 U.S.
Code (S)(S) 77aaa-77bbbb) as in effect on the date of the Indenture. The Senior
Notes are subject to, and qualified by, all such terms, certain of which are
summarized hereon, and Noteholders are referred to the Indenture and such Act
for a statement of such terms. The Senior Notes are unsecured general
obligations of the Company limited to $400,000,000 in aggregate principal
amount.
7. Optional Redemption. Except as provided in Section 8 hereof, the
-------------------
Senior Notes are not redeemable at the Company's option prior to February 15,
2002. Thereafter, the Senior Notes will be subject to redemption at the option
of the Company, in whole or in part, upon not less than 30 nor more than 60
days' notice, at the redemption prices (expressed as percentages of principal
amount ) set forth below plus accrued and unpaid interest thereon to the
applicable redemption date, if redeemed during the twelve-month period beginning
on February 15 of the years indicated below:
Year Percentage
---- ----------
2002 .......................................... 105.000%
2003 .......................................... 103.333%
2004 .......................................... 101.667%
2005 and thereafter ........................... 100.000%
8. Optional Tax Redemption. (a) The Senior Notes may be redeemed at
-----------------------
the option of the Company, in whole but not in part, upon not less than 30 nor
more than 60 days notice, at any time at a redemption price equal to the
principal amount thereof plus accrued and unpaid interest to the date fixed for
redemption if after the date on which Section 3 of this Senior Note becomes
applicable (the "Relevant Date") there has occurred any change in or amendment
to the laws (or any regulations or official rulings promulgated thereunder) of
the United Kingdom (or any political subdivision or taxing authority thereof or
therein), or any change in or amendment to the official application or
interpretation of such laws, regulation or rulings (a "Change in Tax Law") which
becomes effective after the Relevant Date, as a result of which the Company is
or would be so required on the next succeeding Interest Payment Date to pay
Additional Amounts with respect to the Senior Notes as described under Section 3
hereof with respect to withholding taxes imposed by the United Kingdom (or any
political subdivision or taxing authority thereof or therein)(a "U.K.
Withholding Tax") and such U.K. Withholding Tax is imposed at a rate that
exceeds the rate (if any) at which U.K. Withholding Tax was imposed on the
Relevant Date, provided, however, that (i) this paragraph shall not apply to the
extent that, at the Relevant Date it was known or would have been known had
professional advice of a nationally recognized accounting firm in the United
Kingdom been sought, that a Change in Tax Law in the United Kingdom was to occur
after the Relevant Date, (ii) no such notice of redemption may be given earlier
than 90 days prior to the earliest date on which the Company would be obliged to
pay such Additional Amounts were a payment in respect of the Senior Notes then
due, (iii) at the time such notice of redemption is given, such obligation to
pay such Additional Amount remains in effect and (iv) the payment of such
Additional Amounts cannot be avoided by the use of any reasonable measures
available to the Company.
(b) The Senior Notes may also be redeemed, in whole but not in part,
at any time at a redemption price equal to the principal amount thereof plus
accrued and unpaid interest to the date fixed for redemption if the person
formed after the Relevant Date by a consolidation, amalgamation, reorganization
or reconstruction (or other similar arrangement) of the Company or the person
into which the Company is merged after the Relevant Date or to which the Company
conveys, transfers or leases its
70
properties and assets after the Relevant Date substantially as an entirety
(collectively, a "Subsequent Consolidation") is required, as a consequence of
such Subsequent Consolidation and as a consequence of a Change in Tax Law in the
United Kingdom occurring after the date of such Subsequent Consolidation to pay
Additional Amounts with respect to Senior Notes with respect to U.K. Withholding
Tax as described under Section 3 hereof and such U.K. Withholding Tax is imposed
at a rate that exceeds the rate (if any) at which U.K. Withholding Tax was or
would have been imposed on the date of such Subsequent Consolidation, provided,
however, that this paragraph shall not apply to the extent that, at the date of
such Subsequent Consolidation it was known or would have been known had
professional advice of a nationally recognized accounting firm in the United
Kingdom been sought, that a Change in Tax Law in the United Kingdom was to occur
after such date.
The Company will also pay, or make available for payment, to holders
on the Redemption Date any Additional Amounts (as described, but subject to the
exceptions referred to, in Section 3 hereof) resulting from the payment of such
Redemption Price.
9. Notice of Redemption. Notice of redemption will be mailed at
--------------------
least 30 days but not more than 60 days before the redemption date to each
holder of the Senior Notes to be redeemed at his address of record. The Senior
Notes in denominations larger than $1,000 may be redeemed in part but only in
integral multiples of $1,000. In the event of a redemption of less than all of
the Senior Notes, the Senior Notes will be chosen for redemption by the Trustee
in accordance with the Indenture. On and after the redemption date, interest
ceases to accrue on the Senior Notes or portions of them called for redemption.
If this Senior Note is redeemed subsequent to a record date with
respect to any interest payment date specified above and on or prior to such
interest payment date, then any accrued interest will be paid to the person in
whose name this Senior Note is registered at the close of business on such
record date.
10. Mandatory Redemption. Except as set forth in Sections 4.10 and
--------------------
4.13 of the Indenture, the Company will not be required to make mandatory
redemption or repurchase payments with respect to the Senior Notes. There are
no sinking fund payments with respect to the Senior Notes.
11. Repurchase at Option of Holder. (a) If there is a Change of
------------------------------
Control Triggering Event, the Company shall be required to offer to purchase on
the Purchase Date all outstanding Senior Notes at a purchase price equal to 101%
of the aggregate principal amount thereof, plus accrued and unpaid interest to
the Purchase Date. Noteholders of Senior Notes that are subject to an offer to
purchase will receive a Change of Control offer from the Company prior to any
related Purchase Date and may elect to have such Senior Notes or portions
thereof in authorized denominations purchased by completing the form entitled
"Option of Noteholder to Elect Purchase" appearing below.
(b) If the Company or a Subsidiary consummates any Asset Sales, and
when the aggregate amount of Excess Proceeds from such Asset Sales exceeds $15
million, the Company shall be required to make an offer (an "Asset Sale Offer")
to all holders of the Senior Notes and Other Qualified Notes to purchase the
maximum principal amount of Senior Notes and Other Qualified Notes (determined
on a pro rata basis according to the principal amount or accreted value, as the
case may be, of the Senior Notes and the Other Qualified Notes; provided,
however, that the asset sale offer must be made first to the holders of the
Applicable Notes) that may be purchased out of the Excess Proceeds, if any,
remaining after the consummation of an asset sale offer made to holders of the
Applicable Notes, with respect to the
71
Senior Notes at an offer price in cash in an amount equal to 100% of the
outstanding principal amount thereof plus accrued and unpaid interest, if any,
to the date fixed for the closing of such offer. To the extent that the
aggregate amount of Senior Notes tendered pursuant to an Asset Sale Offer is
less than the Excess Proceeds, the Company may use such deficiency for general
corporate purposes. If the aggregate principal amount or accreted value, as the
case may be, of Senior Notes and Other Qualified Notes surrendered by holders
thereof exceeds the amount of Excess Proceeds, if any, remaining after the
consummation of an asset sale offer made to holders of the Applicable Notes,
then any remaining Excess Proceeds will be allocated pro rata according to
principal amount or accreted value, as the case may be, to the Senior Notes and
each issue of the Other Qualified Notes and, the Trustee will select the Senior
Notes to be purchased in accordance with Section 3.08(e) of the Indenture. Upon
completion of such offer to purchase, the amount of Excess Proceeds will be
reset at zero.
12. Denominations, Transfer, Exchange. The Senior Notes are in
---------------------------------
registered form, without coupons, in denominations of $1,000 and integral
multiples of $1,000. The transfer of Senior Notes may be registered, and Senior
Notes may be exchanged, as provided in the Indenture. The Registrar may require
a Noteholder, among other things, to furnish appropriate endorsements and
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Registrar need not exchange or register the transfer of any
Senior Note or portion of a Senior Note selected for redemption (except the
unredeemed portion of any Senior Note being redeemed in part). Also, it need
not exchange or register the transfer of any Senior Note for a period of 15 days
before a selection of Senior Notes to be redeemed.
13. Persons Deemed Owners. Except as provided in paragraph 4 of this
---------------------
Senior Note, the registered Noteholder of a Senior Note may be treated as its
owner for all purposes.
14. Unclaimed Money. If money for the payment of principal or
---------------
interest remains unclaimed for two years, the Trustee and the Paying Agent shall
pay the money back to the Company at its written request. After that,
Noteholders of Senior Notes entitled to the money must look to the Company for
payment unless an abandoned property law designates another person and all
liability of the Trustee and such Paying Agent with respect to such money shall
cease.
15. Defaults and Remedies. The Senior Notes shall have the Events of
---------------------
Default set forth in Section 6.01 of the Indenture. Subject to certain
limitations in the Indenture, if an Event of Default occurs and is continuing,
the Trustee by notice to the Company or the Noteholders of at least 25% in
aggregate principal amount of the then outstanding Senior Notes by notice to the
Company and the Trustee may declare all the Senior Notes to be due and payable
immediately, except that in the case of an Event of Default arising from certain
events of bankruptcy or insolvency, all unpaid principal and interest accrued on
the Senior Notes shall become due and payable immediately without further action
or notice. The Noteholders of a majority in principal amount of the Senior
Notes then outstanding by written notice to the Trustee may rescind an
acceleration and its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default have been cured or
waived except nonpayment of principal or interest that has become due solely
because of the acceleration. Noteholders may not enforce the Indenture or the
Senior Notes except as provided in the Indenture. Subject to certain
limitations, Noteholders of a majority in principal amount of the then
outstanding Senior Notes issued under the Indenture may direct the Trustee in
its exercise of any trust or power. The Company must furnish annually
compliance certificates to the Trustee. The above description of Events of
Default and remedies is qualified by reference, and subject in its entirety, to
the more complete description thereof contained in the Indenture.
72
16. Amendments, Supplements and Waivers. Subject to certain
-----------------------------------
exceptions, the Indenture or the Senior Notes may be amended or supplemented
with the consent of the Noteholders of at least a majority in principal amount
of the then outstanding Senior Notes (including consents obtained in connection
with a tender offer or exchange offer for Senior Notes), and any existing
default may be waived with the consent of the Noteholders of a majority in
principal amount of the then outstanding Senior Notes. Without the consent of
any Noteholder, the Indenture or the Senior Notes may be amended among other
things, to cure any ambiguity, defect or inconsistency, to provide for
assumption of the Company's obligations to Noteholders, to make any change that
does not adversely affect the rights of any Noteholder or to qualify the
Indenture under the TIA or to comply with the requirements of the SEC in order
to maintain the qualification of the Indenture under the TIA.
17. Restrictive Covenants. The Indenture imposes certain limitations
---------------------
on the ability of the Company and its Subsidiaries to, among other things,
engage in certain transactions with Affiliates, incur additional indebtedness
and make payments in respect of Capital Stock. The limitations are subject to a
number of important qualifications and exceptions.
18. Trustee Dealings with the Company. The Trustee, in its
---------------------------------
individual or any other capacity may become the owner or pledgee of the Senior
Notes and may otherwise deal with the Company or an Affiliate with the same
rights it would have, as if it were not Trustee, subject to certain limitations
provided for in the Indenture and in the TIA. Any Agent may do the same with
like rights.
19. No Recourse Against Others. A director, officer, employee or
--------------------------
stockholder, as such, of the Company shall not have any liability for any
obligations of the Company under the Senior Notes or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. Each Noteholder of the Senior Notes by accepting a Senior Note waives
and releases all such liability. The waiver and release are part of the
consideration for the issue of the Senior Notes.
20. Governing Law. THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL
-------------
GOVERN THE INDENTURE AND THE SENIOR NOTES WITHOUT REGARD TO CONFLICT OF LAW
PROVISIONS THEREOF.
21. Authentication. The Senior Notes shall not be valid until
--------------
authenticated by the manual signature of an authorized officer of the Trustee or
an authenticating agent.
22. Abbreviations. Customary abbreviations may be used in the name
-------------
of a Noteholder or an assignee, such as: TEN COM (= tenants in common), TEN ENT
(= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (- Custodian), and UGMA (=
Uniform Gifts to Minors Act).
The Company will furnish to any Noteholder of the Senior Notes upon
written request and without charge a copy of the Indenture. Request may be made
to:
International CableTelIncorporated
110 East 59th Street, 6th Floor
New York, New York 10022
Attention of: Richard J. Lubasch, Esq.
General Counsel
73
ASSIGNMENT FORM
To assign this Senior Note, fill in the form below:
(I) or (we) assign and transfer this Senior Note to
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint __________________________________________ agent to
transfer this Senior Note on the books of the Company. The agent may substitute
another to act for him.
Your Signature: ______________________________________________
(Sign exactly as your name appears on the other
side of this Senior Note)
Date: __________________
Signature Guarantee: *____________________________________________
In connection with any transfer of any of the Senior Notes evidenced by
this certificate occurring prior to the date that is three years after the
later of the date of original issuance of such Senior Notes and the last
date, if any, on which such Senior Notes were owned by the Company or any
Affiliate of the Company, the undersigned confirms that such Senior Notes
are being transferred:
CHECK ONE BOX BELOW
(1) [ ] to the Company; or
(2) [ ] pursuant to and in compliance with Rule 144A under
the Securities Act of 1933; or
(3) [ ] pursuant to and in compliance with Regulation S
under the Securities Act of 1933; or
- ------------------
*. Signature must be guaranteed by a commercial bank, trust company or member
firm of the New York Stock Exchange.
74
(4) [ ] to an institutional "accredited investor" (as defined in
Schedule 501(a)(1), (2), (3) or (7) under the Securities Act of 1933)
that has furnished to the Trustee a signed letter containing certain
representations and agreements (the form of which letter can be
obtained from the Trustee); or
(5) [ ] pursuant to another available exemption from the
registration requirements of the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to
register any of the Senior Notes evidenced by this certificate in the
name of any person other than the registered holder thereof; provided,
however, that if box (3), (4) or (5) is checked, the Trustee may
require, prior to registering any such transfer of the Senior Notes
such legal opinions, certifications and other information as the
Company has reasonably requested to confirm that such transfer is
being made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act of
1933, such as the exemption provided by Rule 144 under such Act.
---------------------------------
Signature
Signature Guarantee*
- ------------------------- ----------------------------------
Signature must be guaranteed Signature
- --------------------------------------------------------------------------------
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Senior Note for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the 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: _____________________ ____________________________________
- -----------------------
*. Signature must be guaranteed by a commercial bank, trust company or member
firm of the New York Stock Exchange.
75
NOTICE: To be executed by an executive officer
76
OPTION OF NOTEHOLDER TO ELECT PURCHASE
If you want to elect to have this Senior Note or a portion thereof
repurchased by the Company pursuant to Section 3.08, 4.10 or 4.13 of the
Indenture, check the box: [ ]
If the purchase is in part, indicate the portion (in denominations of
$1,000 or any integral multiple thereof) to be purchased:______________________
Your Signature: _____________________________________________________
(Sign exactly as your name appears on the other side of
this Senior Note)
Date: ________________________
Signature Guarantee:**/
--
___________________
**. Signature must be guaranteed by a commercial bank, trust company or member
firm of the New York Stock Exchange.
77
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The initial principal amount of this Global Security shall be
$__________________. The following increases or decreases in the principal
amount of this Global Security have been made:
Amount of decrease in Amount of increase in Principal amount of Signature of authorized
principal amount of principal amount of this Global Security officer of Trustee or
Date of exchange this Global Security this Global Security following such decrease Securities Custodian
or increase
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
====================================================================================================================================
78
EXHIBIT B
[FORM OF FACE OF EXCHANGE NOTE]
[Global Securities Legend. if applicable]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
79
No.___________ $
-
CUSIP No. [ ]CINS No. [ ]
10% SERIES B SENIOR NOTE DUE 2007
International CableTel Incorporated, a Delaware corporation (the
"Company") promises to pay to _____________________________________________ or
registered assigns, the principal sum of [ ] Dollars $[ ]
[or such other amount as is indicated on Schedule A hereof] ***** on February
15, 2007, subject to the further provisions of this Senior Note set forth on the
reverse hereof which further provisions shall for all purposes have the same
effect as if set forth at this place.
Interest Payment Dates: February 15 and August 15, commencing August 15, 1997
Record Dates: February 1 and August 1
IN WITNESS WHEREOF, International CableTel Incorporated has caused
this Senior Note to be signed manually or by facsimile by its duly authorized
officers and a facsimile of its corporate seal to be affixed hereto or imprinted
hereon.
Dated: ________________
INTERNATIONAL CABLETEL
INCORPORATED,
by
_____________________________________
by
_____________________________________
[Seal]
- ------------------------------
***** Applicable to Global Securities only.
80
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 10% Series B Senior Notes
described in the within-mentioned Indenture.
THE CHASE MANHATTAN BANK, as Trustee
By: ________________________________
Authorized Officer
81
(FORM OF REVERSE OF EXCHANGE NOTE)
INTERNATIONAL CABLETEL INCORPORATED
10% Series B Senior Note Due 2007
1. Interest. INTERNATIONAL CABLETEL INCORPORATED, a Delaware
--------
corporation (the "Company"), is the issuer of 10% Series B Senior Notes Due 2007
(the "Senior Notes"). The Senior Notes will accrue interest at a rate of 10%
per annum. The Company promises to pay interest on the Senior Notes in cash
semiannually on each February 15 and August 15, commencing August 15, 1997, to
holders of record on the immediately preceding February 1 and August 1,
respectively, at the rate of 10% per annum. Interest on the Senior Notes will
accrue from the most recent date to which interest has been paid, or if no
interest has been paid, from February 12, 1997. Interest will be computed on
the basis of a 360-day year of twelve 30-day months. The Company will pay
interest on overdue principal at the interest rate borne by the Senior Notes,
compounded semiannually, and it shall pay interest on overdue installments of
interest (without regard to any applicable grace period) at the same interest
rate compounded semiannually. Any interest paid on this Senior Note shall be
increased to the extent necessary to pay Additional Amounts as set forth in this
Senior Note.
2. Additional Amounts. This Section 2 will apply only in the event
------------------
that the Company becomes, or a successor to the Company is. a corporation
organized or existing under the laws of England and Wales. All payments made by
the Company on this Senior Note will be made without deduction or withholding,
for or on account of, any and all present or future taxes, duties, assessments,
or governmental charges of whatever nature unless the deduction or withholding
of such taxes, duties, assessments or governmental charges is then required by
law. If any deduction or withholding for or on account of any present or future
taxes, assessments or other governmental charges of the United Kingdom (or any
political subdivision or taxing authority thereof or therein) shall at any time
be required in respect of any amounts to be paid by the Company under this
Senior Note, the Company will pay or cause to be paid such additional amounts
("Additional Amounts") as may be necessary in order that the net amounts
received by a holder of this Senior Note after such deduction or withholding
shall be not less than the amounts specified in this Senior Note to which the
holder of this Senior Note is entitled; provided, however, that the Company
-------- -------
shall not be required to make any payment of Additional Amounts for or on
account of:
(a) any tax, assessment or other governmental charge to the extent
such tax, assessment or other governmental charge would not have been
imposed but for (i) the existence of any present or former connection
between such holder (or between a fiduciary, settlor, beneficiary, member
or shareholder of, or possessor of a power over, such holder, if such
holder is an estate, nominee, trust, partnership or corporation), other
than the holding of this Senior Note or the receipt of amounts payable in
respect of this Senior Note and the United Kingdom or any political
subdivision or taxing authority thereof or therein, including, without
limitation, such holder (or such fiduciary, settlor, beneficiary, member,
shareholder or possessor) being or having been a citizen or resident
thereof or being or having been present or engaged in trade or business
therein or having or having had a permanent establishment therein or (ii)
the presentation of this Senior Note (where presentation is required) for
payment on a date more than 30 days after the date on which such payment
became due and payable or the date on which payment thereof is duly
provided for, whichever occurs later, except to the extent that the holder
would have been entitled
82
to Additional Amounts had this Senior Note been presented on the last day
of such period of 30 days;
(b) any tax, assessment or other governmental charge that is imposed
or withheld by reason of the failure to comply by the holder of this Senior
Note or, if different, the beneficial owner of the interest payable on this
Senior Note, with a timely request of the Company addressed to such holder
or beneficial owner to provide information, documents or other evidence
concerning the nationality, residence, identity or connection with the
taxing jurisdiction of such holder or beneficial owner which is required or
imposed by a statute, regulation or administrative practice of the taxing
jurisdiction as a precondition to exemption from all or part of such tax,
assessment or governmental charge;
(c) any estate, inheritance, gift, sales, transfer, personal property
or similar tax, assessment or other governmental charge;
(d) any tax, assessment or other governmental charge which is
collectible otherwise than by withholding from payments of principal
amount, redemption amount, Change of Control Payment or interest with
respect to a Senior Note or withholding from the proceeds of a sale or
exchange of a Senior Note;
(e) any tax, assessment or other governmental charge required to be
withheld by any Paying Agent from any payment of principal amount,
redemption amount, Change of Control Payment or interest with respect to a
Senior Note, if such payment can be made without such withholding by any
other Paying Agent located inside the United States;
(f) any tax, assessment or other governmental charge imposed on a
holder that is not the beneficial owner of a Senior Note to the extent that
the beneficial owner would not have been entitled to the payment of any
such Additional Amounts had the beneficial owner directly held the Senior
Note;
(g) any combination of items (a), (b), (c), (d), (e) and (f) above;
nor shall Additional Amounts be paid with respect to any payment of the
principal of, or any interest on, this Senior Note to any holder who is a
fiduciary or partnership or other than the sole beneficial owner of such payment
to the extent that a beneficiary or settlor would not have been entitled to any
Additional Amounts had such beneficiary or settlor been the holder of this
Senior Note. All references to principal amount or interest on the Senior Notes
in the Indenture or the Senior Notes shall include any Additional Amounts
payable to the Company pursuant to this Section 2.
3. Method of Payment. The Company will pay interest on the Senior
-----------------
Notes (except defaulted interest) to the persons who are registered holders of
Senior Notes at the close of business on the record date for the next interest
payment date even though Senior Notes are canceled after the record date and on
or before the interest payment date. Noteholders must surrender Senior Notes to
a Paying Agent to collect principal payments. The Company will pay principal
and interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. However, the Company may pay
principal and interest by check payable in such money. It may mail an interest
check to a holder's registered address. If a holder so requests, principal and
interest may be paid by wire
83
transfer of immediately available funds to an account previously specified in
writing by such holder to the Company and the Trustee.
4. Paying Agent and Registrar. The Trustee will act as Paying Agent
--------------------------
and Registrar. The Company may change any Paying Agent, Registrar or co-
registrar without prior notice. The Company or any of its Affiliates may act in
any such capacity.
5. Indenture. The Company issued the Senior Notes under an
---------
indenture, dated as of February 12, 1997 (the "Indenture") between the Company
and The Chase Manhattan Bank, as Trustee. The terms of the Senior Notes include
those stated in the Indenture and those made part of the Indenture by the Trust
Indenture Act of 1939 (15 U.S. Code (S)(S) 77aaa-77bbbb) as in effect on the
date of the Indenture. The Senior Notes are subject to, and qualified by, all
such terms, certain of which are summarized hereon, and Noteholders are referred
to the Indenture and such Act for a statement of such terms. The Senior Notes
are unsecured general obligations of the Company limited to $400,000,000 in
aggregate principal amount.
6. Optional Redemption. Except as provided in Section 7 herein, the
-------------------
Senior Notes are not redeemable at the Company's option prior to February 15,
2002. Thereafter, the Senior Notes will be subject to redemption at the option
of the Company, in whole or in part, upon not less than 30 nor more than 60
days' notice, at the redemption prices (expressed as percentages of principal
amount) set forth below plus accrued and unpaid interest thereon to the
applicable redemption date, if redeemed during the twelve-month period beginning
on February 15 of the years indicated below:
Year Percentage
---- ----------
2002 ........................................ 105.000%
2003 ........................................ 103.333%
2004 ........................................ 101.667%
2005 and thereafter ......................... 100.000%
7. Optional Tax Redemption. (a) The Senior Notes may be redeemed at
-----------------------
the option of the Company, in whole but not in part, upon not less than 30 nor
more than 60 days notice, at any time at a redemption price equal to the
principal amount thereof plus accrued and unpaid interest to the date fixed for
redemption if after the date on which Section 2 of this Senior Note becomes
applicable (the "Relevant Date") there has occurred any change in or amendment
to the laws (or any regulations or official rulings promulgated thereunder) of
the United Kingdom (or any political subdivision or taxing authority thereof or
therein), or any change in or amendment to the official application or
interpretation of such laws, regulations or rulings (a "Change in Tax Law")
which becomes effective after the Relevant Date, as a result of which the
Company is or would be so required on the next succeeding Interest Payment Date
to pay Additional Amounts with respect to the Senior Notes as described under
Section 2 hereof with respect to withholding taxes imposed by the United Kingdom
(or any political subdivision or taxing authority thereof or therein) (a "U.K.
Withholding Tax') and such U.K. Withholding Tax is imposed at a rate that
exceeds the rate (if any) at which U.K. Withholding Tax was imposed on the
Relevant Date, provided, however, that (i) this paragraph shall not apply to the
-------- -------
extent that, at the Relevant Date it was known or would have been known had
professional advice of a nationally recognized accounting firm in the United
Kingdom been sought, that a change in Tax Law in the United Kingdom was to occur
after the Relevant Date, (ii) no such notice of redemption may be given earlier
than 90 days
84
prior to the earliest date on which the Company would be obliged to pay such
Additional Amounts were a payment in respect of the Senior Notes then due, (iii)
at the time such notice of redemption is given, such obligation to pay such
Additional Amount remains in effect and (iv) the payment of such Additional
Amounts cannot be avoided by the use of any reasonable measures available to the
Company.
(b) The Senior Notes may also be redeemed, in whole but not in part,
at any time at a redemption price equal to the principal amount thereof plus
accrued and unpaid interest to the date fixed for redemption if the person
formed after the Relevant Date by a consolidation, amalgamation, reorganization
or reconstruction (or other similar arrangement) of the Company or the person
into which the Company is merged after the Relevant Date or to which the Company
conveys, transfers or leases its properties and assets after the Relevant Date
substantially as an entirety (collectively, a "Subsequent Consolidation") is
required, as a consequence of such Subsequent Consolidation and as a consequence
of a Change in Tax Law in the United Kingdom occurring after the date of such
Subsequent Consolidation to pay Additional Amounts with respect to Senior Notes
with respect to U.K. Withholding Tax as described under Section 2 hereof and
such U.K. Withholding Tax is imposed at a rate that exceeds the rate (if any) at
which U.K. Withholding Tax was or would have been imposed on the date of such
Subsequent Consolidation, provided, however, that this paragraph shall not apply
-------- -------
to the extent that, at the date of such Subsequent Consolidation it was known or
would have been known had professional advice of a nationally recognized
accounting firm in the United Kingdom been sought, that a Change in Tax Law in
the United Kingdom was to occur after such date.
The Company will also pay, or make available for payment, to holders
on the Redemption Date any Additional Amounts (as described, but subject to the
exceptions referred to, in Section 2 hereof) resulting from the payment of such
Redemption Price.
8. Notice of Redemption. Notice of redemption will be mailed at
--------------------
least 30 days but not more than 60 days before the redemption date to each
holder of the Senior Notes to be redeemed at his address of record. The Senior
Notes in denominations larger than $1,000 may be redeemed in part but only in
integral multiples of $1,000. In the event of a redemption of less than all of
the Senior Notes, the Senior Notes will be chosen for redemption by the Trustee
in accordance with the Indenture. On and after the redemption date, interest
ceases to accrue on the Senior Notes or portions of them called for redemption.
If this Senior Note is redeemed subsequent to a record date with
respect to any interest payment date specified above and on or prior to such
interest payment date, then any accrued interest will be paid to the person in
whose name this Senior Note is registered at the close of business on such
record date.
9. Mandatory Redemption. Except as set forth in Sections 4.10 and
--------------------
4.13 of the Indenture, the Company will not be required to make mandatory
redemption or repurchase payments with respect to the Senior Notes. There are
no sinking fund payments with respect to the Senior Notes.
10. Repurchase at Option of Holder. (a) If there is a Change of
------------------------------
Control Triggering Event, the Company shall be required to offer to purchase on
the Purchase Date all outstanding Senior Notes at a purchase price equal to 101%
of the aggregate principal amount thereof, plus accrued and unpaid interest to
the Purchase Date. Noteholders of Senior Notes that are subject to an offer to
purchase will receive a Change of Control offer from the Company prior to any
related Purchase Date and may
85
elect to have such Senior Notes or portions thereof in authorized denominations
purchased by completing the form entitled "Option of Noteholder to Elect
Purchase" appearing below.
(b) If the Company or a Subsidiary consummates any Asset Sales, and
when the aggregate amount of Excess Proceeds from such Asset Sales exceeds $15
million, the Company shall be required to make an offer (an "Asset Sale Offer")
to all holders of the Senior Notes and Other Qualified Notes to purchase the
maximum principal amount of Senior Notes and other Qualified Notes (determined
on a pro rata basis according to the principal amount or accreted value, as the
case may be, of the Senior Notes and the Other Qualified Notes; provided,
--------
however, that the asset sale offer must be made first to the holders of the
- -------
Applicable Notes) that may be purchased out of the Excess Proceeds, if any,
remaining after the consummation of an asset sale offer made to the holders of
the Applicable Notes with respect to the Senior Notes at an offer price in cash
in an amount equal to 100% of the outstanding principal amount thereof plus
accrued and unpaid interest, if any, to the date fixed for the closing of such
offer. To the extent that the aggregate amount of Senior Notes tendered
pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Company
may use such deficiency for general corporate purposes. If the aggregate
principal amount or accreted value, as the case may be, of Senior Notes and
Other Qualified Notes surrendered by holders thereof exceeds the amount of
Excess Proceeds, if any, remaining after the consummation of an asset sale offer
made to the holders of the Applicable Notes, then any remaining Excess Proceeds
will be allocated pro rata according to principal amount or accreted value, as
the case may be, to the Senior Notes and each issue of the Other Qualified Notes
and, the Trustee will select the Senior Notes to be purchased in accordance with
Section 3.08(e) of the Indenture. Upon completion of such offer to purchase,
the amount of Excess Proceeds will be reset at zero.
11. Denominations, Transfer, Exchange. The Senior Notes are in
---------------------------------
registered form, without coupons, in denominations of $1,000 and integral
multiples of $1,000. The transfer of Senior Notes may be registered, and Senior
Notes may be exchanged, as provided in the Indenture. The Registrar may require
a Noteholder, among other things, to furnish appropriate endorsements and
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Registrar need not exchange or register the transfer of any
Senior Note or portion of a Senior Note selected for redemption (except the
unredeemed portion of any Senior Note being redeemed in part). Also, it need
not exchange or register the transfer of any Senior Note for a period of 15 days
before a selection of Senior Notes to be redeemed.
12. Persons Deemed Owners. Except as provided in paragraph 3 of this
---------------------
Senior Note, the registered Noteholder of a Senior Note may be treated as its
owner for all purposes.
13. Unclaimed Money. If money for the payment of principal or
---------------
interest remains unclaimed for two years, the Trustee and the Paying Agent shall
pay the money back to the Company at its written request. After that,
Noteholders of Senior Notes entitled to the money must look to the Company for
payment unless an abandoned property law designates another person and all
liability of the Trustee and such Paying Agent with respect to such money shall
cease.
14. Defaults and Remedies. The Senior Notes shall have the Events of
---------------------
Default as set forth in Section 6.01 of the Indenture. Subject to certain
limitations in the Indenture, if an Event of Default occurs and is continuing,
the Trustee by notice to the Company or the Noteholders of at least 25% in
aggregate principal amount of the then outstanding Senior Notes by notice to the
Company and the Trustee may declare all the Senior Notes to be due and payable
immediately, except that in the case of an Event of Default arising from certain
events of bankruptcy or insolvency, all unpaid principal and
86
interest accrued on the Senior Notes shall become due and payable immediately
without further action or notice. The Noteholders of a majority in principal
amount of the Senior Notes then outstanding by written notice to the Trustee may
rescind an acceleration and its consequences if the rescission would not
conflict with any judgment or decree and if all existing Events of Default have
been cured or waived except nonpayment of principal or interest that has become
due solely because of the acceleration. Noteholders may not enforce the
Indenture or the Senior Notes as provided in the Indenture. Subject to certain
limitations, Noteholders of a majority in principal amount of the then
outstanding Senior Notes issued under the Indenture may direct the Trustee in
its exercise of any trust or power. The Company must furnish annually
compliance certificates to the Trustee. The above description of Events of
Default and remedies is qualified by reference, and subject in its entirety, to
the more complete description thereof contained in the Indenture.
15. Amendments, Supplements and Waivers. Subject to certain
-----------------------------------
exceptions, the Indenture or the Senior Notes may be amended or supplemented
with the consent of the Noteholders of at least a majority in principal amount
of the then outstanding Senior Notes (including consents obtained in connection
with a tender offer or exchange offer for Senior Notes), and any existing
default may be waived with the consent of the Noteholders of a majority in
principal amount of the then outstanding Senior Notes. Without the consent of
any Noteholder, the Indenture or the Senior Notes may be amended among other
things, to cure any ambiguity, defect or inconsistency, to provide for
assumption of the Company's obligations to Noteholders, to make any change that
does not adversely affect the rights of any Noteholder or to qualify the
Indenture under the TIA or to comply with the requirements of the SEC in order
to maintain the qualification of the Indenture under the TIA.
16. Restrictive Covenants. The Indenture imposes certain limitations
---------------------
on the ability of the Company and its Subsidiaries to, among other things,
engage in certain transactions with Affiliates, incur additional Indebtedness
and make payments in respect of Capital Stock. The limitations are subject to a
number of important qualifications and exceptions.
17. Trustee Dealings with the Company. The Trustee, in its
---------------------------------
individual or any other capacity may become the owner or pledgee of the Senior
Notes and may otherwise deal with the Company or an Affiliate with the same
rights it would have, as if it were not Trustee, subject to certain limitations
provided for in the Indenture and in the TIA. Any Agent may do the same with
like rights.
18. No Recourse Against Others. A director, officer, employee or
--------------------------
stockholder, as such, of the Company shall not have any liability for any
obligations of the Company under the Senior Notes or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. Each Noteholder of the Senior Notes by accepting a Senior Note waives
and releases all such liability. The waiver and release are part of the
consideration for the issue of the Senior Notes.
19. Governing Law. THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL
-------------
GOVERN THE INDENTURE AND THE SENIOR NOTES WITHOUT REGARD TO CONFLICT OF LAW
PROVISIONS THEREOF.
20. Authentication. The Senior Notes shall not be valid until
--------------
authenticated by the manual signature of an authorized officer of the Trustee or
an authenticating agent.
21. Abbreviations. Customary abbreviations may be used in the name
-------------
of a Noteholder or an assignee, such as: TEN COM (= tenants in common), TEN ENT
(= tenants by the entireties), JT
87
TEN (= joint tenants with right of survivorship and not as tenants in common),
CUST (= Custodian), and UGMA (= Uniform Gifts to Minors Act).
The Company will furnish to any Noteholder of the Senior Notes upon
written request and without charge a copy of the Indenture. Request may be made
to:
International CableTel Incorporated
110 East 59th Street, 26th Floor
New York, New York 10022
Attention of:Richard J. Lubasch, Esq.
General Counsel
88
ASSIGNMENT FORM
To assign this Senior Note, fill in the form below:
(I) or (we) assign and transfer this Senior Note to
______________________________________ (Insert assignee's social security or
tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
______________________________________ (Print or type assignee's name, address
and zip code)
and irrevocably appoint __________________________________________ agent to
transfer this Senior Note on the books of the Company. The agent may substitute
another to act for him.
Your Signature:________________________________________
(Sign exactly as your name appears on the other
side of this Senior Note)
Date: __________________
Signature Guarantee: ** ______________________________
- --------------
**. Signature must be guaranteed by a commercial bank, trust company or member
firm of the New York Stock Exchange.
89
OPTION OF NOTEHOLDER TO ELECT PURCHASE
If you want to elect to have this Senior Note or a portion thereof
repurchased by the Company pursuant to Section 3.08, 4.10 or 4.13 of the
Indenture, check the box: [ ]
If the purchase is in part, indicate the portion (in denominations of
$1,000 or any integral multiple thereof) to be purchased: _____________________
Your Signature: _____________________________________________
(Sign exactly as your name appears on the other side
of this Senior Note)
Date: ________________________
Signature Guarantee:***
_____________________
***. Signature must be guaranteed by a commercial bank, trust company or member
firm of the New York Stock Exchange.
90
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The principal amount of this Global Security shall be $_________. The
following increases or decreases in the principal amount of this Global Security
have been made:
Amount of decrease in Amount of increase in Principal amount of Signature of authorized
principal amount of principal amount of this Global Security officer of Trustee or
Date of exchange this Global Security this Global Security following such decrease Securities Custodian
or increase
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
====================================================================================================================================
91
EXHIBIT C
FORM OF TRANSFER CERTIFICATE
FOR TRANSFER FROM
RULE 144A GLOBAL SECURITY OR IAI GLOBAL SECURITY
TO REGULATION S TEMPORARY GLOBAL SECURITY
(Transfers pursuant to (S) 2.06(a)(ii)
of the Indenture)
The Chase Manhattan Bank, as Trustee
450 West 33rd Street
New York, New York 10001
Attn: Corporate Trustee
Administration Department
Re: International CableTel Incorporated
10% Senior Notes Due 2007 (the "Senior Notes")
----------------------------------------------
Reference is hereby made to the Indenture dated as of February 12,
1997 (the "Indenture") between International CableTel Incorporated, as Issuer,
and The Chase Manhattan Bank, as Trustee.
This letter relates to U.S. $[ ] aggregate principal
amount of Senior Notes which are held in the form of the [Rule 144A Global
Security (CUSIP No. [ ])] [IAI Global Security (CUSIP No. [ ])]
with the Depositary in the name of [name of transferor] (the "Transferor") to
effect the transfer of the Senior Notes in exchange for an equivalent beneficial
interest in the Regulation S Temporary Global Securities.
In connection with such request, the Transferor does hereby certify
that such transfer has been effected in accordance with the transfer
restrictions set forth in the Senior Notes and (i) with respect to transfers
made in reliance on Regulation S, does hereby certify that:
(1) the offer of the Senior Notes was not made to a person in the
United States;
(2) the transaction was executed in, on or through the facilities of a
designated offshore securities market and neither the Transferor nor any
person acting on its behalf knows that the transaction was pre-arranged
with a buyer in the United States;
(3) no directed selling efforts have been made in contravention of the
requirements of Rule 903(b) or 904(b) of Regulation S, as applicable; and
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the United States Securities Act of 1933, as
amended (the "Securities Act");
(ii) with respect to transfers made in reliance on Rule 144 does hereby certify
that the Senior Notes are being transferred in a transaction permitted by Rule
144 under the Securities Act; (iii) with respect to transfers made in reliance
on Rule 144A, does hereby certify that such Senior Notes are being transferred
in accordance with Rule 144A under the Securities Act to a transferee that the
Transferor reasonably believes is purchasing the Senior Notes for its own
account or an account with respect to which the transferee exercises sole
investment discretion and the transferee and any such account is a "qualified
92
institutional buyer" within the meaning of Rule 144A, in a transaction meeting
the requirements of Rule 144A and in accordance with applicable securities laws
of any state of the United States or any other jurisdiction; and (iv) with
respect to transfers made in reliance on Rule 501(a)(1), (2), (3) or (7) of
Regulation D under the Securities Act does hereby certify that such Senior Notes
are being transferred to a transferee that the Transferor reasonably believes is
purchasing the Senior Notes for its own account or an account as to which the
transferee exercises sole investment discretion and the transferee and any such
account is an institutional "accredited investor" within the meaning of Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act and in
accordance with applicable securities laws of any state, of the United States or
any other jurisdiction.
In addition, if the sale is made during a restricted period and the
provisions of Rule 903(c)(2) or (3) or Rule 904(c)(1) of Regulation S are
applicable thereto, we confirm that such sale has been made in accordance with
the applicable provisions of Rule 903(c)(2) or (3) or Rule 904(c)(1), as the
case may be.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Capitalized terms used in this
certificate and not otherwise defined in the Indenture have the meanings set
forth in Regulation S.
[Name of Transferor]
By:___________________________
Name:
Title:
Date:
cc: International CableTel Incorporated
110 East 59th Street
New York, New York 10022
Attn: Richard J. Lubasch, Esq.
General Counsel
93
EXHIBIT D
FORM OF TRANSFER CERTIFICATE FOR TRANSFER
FROM REGULATION S TEMPORARY GLOBAL SECURITY
TO RULE 144A GLOBAL SECURITY OR IAI GLOBAL SECURITY
(Transfers pursuant to (S) 2.06(a)(iii)
of the Indenture)
The Chase Manhattan Bank, as Trustee
450 West 33rd Street
New York, New York 10001
Attn: Corporate Trustee
Administration Department
Re: International CableTel Incorporated
10% Senior Notes Due 2007
(the "Senior Notes")
-----------------------------------
Reference is hereby made to the Indenture dated as of February 12,
1997 (the "Indenture) between International CableTel Incorporated, as Issuer,
and The Chase Manhattan Bank, as Trustee. Capitalized terms used but not
defined herein shall have the respective meanings given them in the Indenture.
This letter relates to U.S. $[ ] aggregate
principal amount of Senior Notes which are held in the form of the Regulation S
Temporary Global Security (CINS No. [ ]) with the Depositary in the name of
[name of transferor] (the "Transferor") to effect the transfer of the Senior
Notes in exchange for an equivalent beneficial interest in the [Rule 144AI/AI]
Global Security.
In connection with such request, and in respect of such Senior Notes
the Transferor does hereby certify that such Senior Notes are being transferred
in accordance with (i) the transfer restrictions set forth in the Senior Notes
and (ii) [Rule 144A under the United States Securities Act of 1933, as amended,
to a transferee that the Transferor reasonably believes is purchasing the Senior
Notes for its own account or an account with respect to which the transferee
exercises sole investment discretion and the transferee and any such account is
a "qualified institutional buyer" within the meaning of Rule 144A, in a
transaction meeting the requirements of Rule 144A and] [to a transferee that the
Transferor reasonably believes is purchasing the Senior Notes for its own
account or an account as to which the transferee exercises sole investment
discretion and the transferee and any such account is an institutional
"accredited investor" within the meaning of Rule 501(a)(1), (2), (3) or (7) of
Regulation D and] in accordance with applicable securities laws of any state of
the United States or any other jurisdiction.
94
[Name of Transferor],
By:___________________________
Name:
Title:
Dated:
cc: International CableTel Incorporated
110 East 59th Street
New York, New York 10022
Attn: Richard J. Lubasch, Esq.
General Counsel
95
EXHIBIT E
FORM OF TRANSFER CERTIFICATE FOR TRANSFER
FROM GLOBAL SECURITY OR RESTRICTED
SECURITY TO RESTRICTED SECURITY
(Transfers pursuant to (S) 2.06(a)(iv)
or (S) 2.06(a)(v) of the Indenture)
The Chase Manhattan Bank, as Trustee
450 West 33rd Street
New York, New York 10001
Attn: Corporate Trustee
Administration Department
Re: International CableTel Incorporated
10% Senior Notes Due 2007
(the "Senior Notes")
-----------------------------------
Reference is hereby made to the Indenture dated as of February 12,
1997 (the "Indenture) between International CableTel Incorporated, as Issuer,
and The Chase Manhattan Bank, as Trustee. Capitalized terms used but not
defined herein shall have the respective meanings given them in the Indenture.
This letter relates to U.S. $[ ] aggregate principal amount of
Senior Notes which are held [in the form of the [Rule 144A/IAI/Regulation S]
[Global] [Restricted] Security (CUSIP No. [ ] CINS No. [ ]) with
the Depositary in the name of [name of transferor] (the "Transferor") to
effect the transfer of the Senior Notes.
In connection with such request, and in respect of such Senior Notes,
the Transferor does hereby certify that such Senior Notes are being transferred
(i) in accordance with the transfer restrictions set forth in the Senior Notes
and (ii) to a transferee that the Transferor reasonably believes is an
institutional "accredited investor" (as defined in Rule 501(a)(1), (2), (3) or
(7) of Regulation D under the United States Securities Act of 1933, as amended)
and is acquiring at least $100,000 principal amount of Senior Notes for its own
account or for one or more accounts as to which the transferee exercises sole
investment discretion and (iii) in
- --------------------------------
*Insert, if appropriate.
96
accordance with applicable securities laws of any state of the United States or
any other jurisdiction.
[Name of Transferor],
By:___________________________
Name:
Title:
Dated:
cc: International CableTel Incorporated
110 East 59th Street
New York, New York 10022
Attn: Richard J. Lubasch, Esq.
General Counsel
97
EXHIBIT F
FORM OF ACCREDITED INVESTOR TRANSFEREE CERTIFICATE
(Transfers pursuant to (S) 2.06(a)(iv) or (S) 2.06(a)(v))
The Chase Manhattan Bank, as Trustee
450 West 33rd Street
New York, New York 10001
Attn: Corporate Trustee
Administration Department
Re: International CableTel Incorporated
10% Senior Notes Due 2007
(the "Senior Notes")
-----------------------------------
Reference is hereby made to the Indenture dated as of February 12,
1997 (the "Indenture) between International CableTel Incorporated, as Issuer,
and The Chase Manhattan Bank, as Trustee. Capitalized terms used but not
defined herein shall have the respective meanings given them in the Indenture.
This letter relates to U.S. $[ ] aggregate principal amount of Senior
Notes which are held [in the form of the [Rule 144/IAI/Regulation S]
[Restricted] [Global] Security (CUSIP No. [ ] CINS No. [ ]) with the Depositary
* in the name of [name of transferor] (the "Transferor") to effect the transfer
of the Senior Notes to the undersigned.
In connection with such request, and in respect of such Senior Notes
we confirm that:
1. We understand that the Senior Notes were originally offered in a
transaction not involving any public offering in the United States within
the meaning of the United States Securities Act of 1933, as amended (the
"Securities Act"), that the Senior Notes have not been registered under the
Securities Act and that (A) the Senior Notes may be offered, resold,
pledged or otherwise transferred only (i) to a person who the seller
reasonably believes is a "qualified institutional buyer" (as defined in
Rule 144A under the Securities Act) in a transaction meeting the
requirements of Rule 144A, in a transaction meeting the requirements of
Rule 144 under the Securities Act, to a person who the seller reasonably
believes is an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act),
outside the United States in a transaction meeting the requirements of Rule
903 or 904 of Regulation S under the Securities Act or in accordance with
another exemption from the registration requirements of the Securities Act
(and based upon an opinion of counsel if the Company so requests), (ii) to
the Company or (iii) pursuant to an effective registration statement, and,
in each case, in accordance with any applicable securities laws of any
state of the United States or any other applicable jurisdiction and (B) the
purchaser will, and each subsequent holder is required to, notify any
subsequent purchaser from it of the resale restrictions set forth in (A)
above.
2. We are a corporation, partnership or other entity having such
knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of an investment in the Senior Notes,
and we are (or any account for which we are purchasing
- ---------------------------------
*Insert and modify, if appropriate.
98
under paragraph 4 below is) an institutional "accredited investor" as
defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act, able
to bear the economic risk of our proposed investment in the Securities.
3. We are acquiring the Senior Notes for our own account (or for
accounts as to which we exercise sole investment discretion and have
authority to make, and do make, the statements contained in this letter)
and not with a view to any distribution of the Senior Notes, subject,
nevertheless, to the understanding that the disposition of our property
shall at all times be and remain within our control.
4. We are, and each account (if any) for which we are purchasing
Senior Notes is, purchasing Senior Notes having an aggregate principal
amount of not less than $100,000.
5. We understand that (a) the Senior Notes will be delivered to us in
registered form only and that the certificate delivered to us in respect of
the Senior Notes will bear a legend substantially to the following effect:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE 'SECURITIES ACT'). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE THIRD ANNIVERSARY OF
THE ISSUANCE HEREOF (OR ANY PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER
THAT WAS AN AFFILIATE OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS
PRECEDING THE DATE OF SUCH TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE
COMPANY, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE
144A UNDER THE SECURITIES ACT (`RULE 144A'), TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX CHECKED
BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
SECURITY), (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER
THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), AND, IF SUCH TRANSFER
IS BEING EFFECTED BY CERTAIN TRANSFERORS SPECIFIED IN THE INDENTURE (AS DEFINED
BELOW) PRIOR TO THE EXPIRATION OF THE '40 DAY RESTRICTED PERIOD' (WITHIN THE
MEANING OF RULE 903(c)(2) OF REGULATION S UNDER THE SECURITIES ACT), A
CERTIFICATE WHICH MAY BE OBTAINED FROM THE COMPANY OR THE TRUSTEE IS DELIVERED
BY THE TRANSFEREE TO THE COMPANY AND THE TRUSTEE, (4) TO AN INSTITUTION THAT IS
AN `ACCREDITED INVESTOR' AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY) THAT IS ACQUIRING THIS
SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION, AND A CERTIFICATE IN
THE FORM ATTACHED TO THE INDENTURE IS DELIVERED BY THE TRANSFEREE TO THE COMPANY
AND THE TRUSTEE (PROVIDED THAT CERTAIN HOLDERS SPECIFIED IN THE INDENTURE MAY
NOT TRANSFER THIS SECURITY PURSUANT TO THIS CLAUSE (4) PRIOR TO THE EXPIRATION
OF THE `40 DAY RESTRICTED PERIOD' (WITHIN THE MEANING OF RULE 903(c)(2) OF
REGULATION S UNDER THE SECURITIES ACT), (5) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER
THE SECURITIES ACT, OR (6) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT, IN EACH CASE IN
99
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES. AN INSTITUTIONAL ACCREDITED INVESTOR HOLDING THIS SECURITY AGREES IT
WILL FURNISH TO THE COMPANY AND THE TRUSTEE SUCH CERTIFICATES AND OTHER
INFORMATION AS THEY MAY REASONABLY REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF
THIS SECURITY COMPLIES WITH THE FOREGOING RESTRICTIONS. THE HOLDER HEREOF, BY
PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY
THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
OR (2) AN INSTITUTION THAT IS AN `ACCREDITED INVESTOR' AS DEFINED IN RULE
501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT AND THAT IT IS HOLDING THIS
SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR (3) A NON-U.S.
PERSON OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING
THE REQUIREMENTS OF PARAGRAPH (o)(2) OF RULE 902 UNDER) REGULATION S UNDER THE
SECURITIES ACT."
and (b) such certificates will be reissued without the foregoing legend
only in accordance with the terms of the Indenture.
6. We agree that in the event that at some future time we wish to
dispose of any of the Securities, we will not do so unless:
(a) the Senior Notes are sold to the Company or any Subsidiary
thereof;
(b) the Senior Notes are sold to a qualified institutional buyer
in compliance with Rule 144A under the Securities Act;
(c) the Senior Notes are sold to an institutional accredited
investor, as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, acquiring at least $100,000 principal amount of the
Senior Notes that, prior to such transfer, furnishes to the Trustee a
signed letter containing certain representations and agreements
relating to the restrictions on transfer of the Senior Notes (the form
of which letter can be obtained from such Trustee);
(d) the Senior Notes are sold outside the United States in
compliance with Rule 903 or Rule 904 under the Securities Act;
(e) the Senior Notes are sold by us pursuant to Rule 144 under
the Securities Act; or
(f) the Senior Notes are sold pursuant to an effective
registration statement under the Securities Act.
Very truly yours,
[PURCHASER]
By:___________________________
Name:
Title:
Dated:
100
cc: International CableTel Incorporated
110 East 59th Street
New York, New York 10022
Attn: Richard J. Lubasch, Esq.
General Counsel
101
EXHIBIT G
FORM OF CERTIFICATE FOR TRANSFERS OF
REGULATION S TEMPORARY GLOBAL SECURITY
FOR REGULATION S PERMANENT GLOBAL SECURITY
(Transfers pursuant to (S) 2.06(a)(viii))
(Transferor)
[MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, BRUSSELS OFFICE AS
OPERATOR OF THE EUROCLEAR SYSTEM]
[CEDEL BANK, SOCIETE ANONYME]
Re: International CableTel Incorporated
10% Senior Notes
Due 2007 (the "Senior Notes")
-----------------------------------
Reference is hereby made to the Indenture dated as of February 12,
1997 (the "Indenture") between International CableTel Incorporated, as Issuer,
and The Chase Manhattan Bank, as Trustee. Capitalized terms used but not
defined herein shall have the meanings given them in the Indenture.
This certificate relates to U.S. $[ ] aggregate principal
amount of Senior Notes which are held in the form of the Regulation S Temporary
Global Security (CINS No. [ ]) with the Depositary in the name of [name of
transferor] (the "Transferor") to effect the transfer of the beneficial interest
in such Regulation S Temporary Global Security for a beneficial interest in an
equivalent aggregate principal amount of the Regulation S Permanent Global
Security.
In connection with such request, and in respect of such Senior Notes,
we confirm that:
1. We are either not a U.S. person (as defined below) or we have
purchased our beneficial interest in the above referenced Regulation S
Temporary Global Security in a transaction that is exempt from the
registration requirements under the Securities Act.
2. We are delivering this certificate in connection with obtaining a
beneficial interest in the Regulation S Permanent Global Security in
exchange for our beneficial interest in the Regulation S Temporary Global
Security.
For purposes of this certificate, "U.S. person" means (i) any
individual resident in the United States, (ii) any partnership or corporation
organized or incorporated under the laws of the United States, (iii) any estate
of which an executor or administrator is a U.S. person (other than an estate
governed by foreign law and of which at least one executor or administrator is a
non-U.S. person who has sole or shared investment discretion with respect to its
assets), (iv) any trust of which any trustee is a U.S. person (other than a
trust of which at least one trustee is a non-U.S. person who has sole or shared
investment discretion with respect to its assets and no beneficiary of the trust
(and no settlor if the trust is revocable) is a U.S. person), (v) any agency or
branch of a foreign entity located in the United States, (vi) any non-
discretionary or similar account (other than an estate or trust) held by a
dealer or other fiduciary for the benefit or account of a U.S. person, (vii) any
discretionary or similar account (other than
102
an estate or trust) held by a dealer or other fiduciary organized, incorporated
or (if an individual) resident in the United States (other than such an account
held for the benefit or account of a non-U.S. person), (viii) any partnership or
corporation organized or incorporated under the laws of a foreign jurisdiction
and formed by a U.S. person principally for the purpose of investing in
securities not registered under the Securities Act (unless it is organized or
incorporated, and owned, by accredited investors within the meaning of Rule
501(a) under the Securities Act who are not natural persons, estates or trusts);
provided, however, that the term "U.S. person" shall not include (A) a branch or
- -------- -------
agency of a U.S. person that is located and operating outside the United States
for valid business purposes as a locally regulated branch or agency engaged in
the banking or insurance business, (B) any employee benefit plan established and
administered in accordance with the law, customary practices and documentation
of a foreign country and (C) the international organizations set forth in
Section 902(o)(7) of Regulation S under the Securities Act and any other similar
international organizations, and their agencies, affiliates and pension plans.
We irrevocably authorize you to produce this certificate or a copy
hereof to any interested party in any administrative or other proceedings with
respect to the matters covered by this certificate.
Very truly yours,
[TRANSFEROR]
By:___________________________
Name:
Title:
To be completed by the account holder as, or as
agent for, the beneficial owner(s) of the Senior
Notes to which this certificate relates.
Dated:
cc: International CableTel Incorporated
110 East 59th Street
New York, New York 10022
Attn: Richard J. Lubasch, Esq.
General Counsel
103
EXHIBIT H
FORM OF CERTIFICATE FOR TRANSFERS OF
REGULATION S TEMPORARY GLOBAL SECURITIES
FOR REGULATION S PERMANENT GLOBAL SECURITIES
(Transfers pursuant to (S) 2.06(a)(viii))
(Euroclear or Cedel)
The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001
Attn: Corporate Trustee
Administration Department
Re: International CableTel Incorporated
10% Senior Notes Due 2007
(the "Senior Notes")
------------------------------------
Reference is hereby made to the Indenture dated as of February 12,
1997 (the "Indenture") between International CableTel Incorporated, as Issuer,
and The Chase Manhattan Bank, as Trustee. Capitalized terms used but not
defined herein shall have the meanings given them in the Indenture.
This certificate relates to U.S. $[ ] aggregate principal amount
of Senior Notes which are held in the form of the Regulation S Temporary Global
Security (CINS No. [ ]) with the Depositary to effect the transfer of the
beneficial interest in such Regulation S Temporary Global Security for a
beneficial interest in an equivalent aggregate principal amount of the
Regulation S Permanent Global Security.
In connection with such request, this is to certify that, based solely
on certificates we have received in writing, by tested telex or by electronic
transmission from member organizations appearing in our records as persons being
entitled to a portion of the principal amount of the Regulation S Temporary
Global Security set forth above (our "Member Organizations") substantially to
the effect set forth in the Indenture, U.S. $[ ] aggregate principal
amount of the Senior Notes is owned by persons that are not citizens or
residents of the United States, domestic partnerships, domestic corporations or
any estate or trust the income of which is subject to United States federal
income taxation regardless of its source or any other person deemed a "U.S.
person" under Regulation S under the Securities Act of 1993, as amended.
We further certify (i) that we are not making available herewith for
exchange (or if relevant, exercise of any rights of collection of any interest)
any portion of the Regulation S Global Security excepted in such certificates
and (ii) that, as of the date hereof, we have not received any notification from
any of our Member Organizations to the effect that the statements made by such
Member Organizations with respect to any portion of the part submitted herewith
for exchange (or, if relevant, exercise of any rights of collection of any
interest) are no longer true and cannot be relied upon as of the date hereof.
We understand that this certificate is required in connection with
certain laws, and, if applicable, certain securities laws of the United States.
In connection therewith, if administrative or legal
104
proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certification to any interested party in such proceedings.
Very truly yours,
[MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, BRUSSELS OFFICE AS
OPERATOR OF THE EUROCLEAR SYSTEM]
[CEDEL BANK, SOCIETE ANONYME]
By:___________________________
Name:
Title:
Dated:
cc: International CableTel Incorporated
110 East 59th Street
New York, New York 10022
Attn: Richard J. Lubasch, Esq.
General Counsel
105
EXHIBIT I
FORM OF CERTIFICATE FOR TRANSFERS OF
REGULATION S PERMANENT GLOBAL SECURITY FOR
RESTRICTED SECURITIES
(Transfers pursuant to (S) 2.06(a)(viii))
(Transferor)
The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001
Attn: Corporate Trustee
Administration Department
Re: International CableTel Incorporated
10% Senior Notes Due 2007
(the "Senior Notes")
-----------------------------------
Reference is hereby made to the Indenture dated as of February 12,
1997 (the "Indenture") between International CableTel Incorporated, as Issuer,
and The Chase Manhattan Bank, as Trustee. Capitalized terms used but not
defined herein shall have the respective meanings given them in the Indenture.
This certificate relates to U.S. $[ ] aggregate principal amount
of Senior Notes which are held in the form of the Regulation S Permanent Global
Security (CINS No. [ ]) with the Depositary in the name of [name of
transferor] (the "Transferor") to effect the transfer of the beneficial interest
in such Regulation S Permanent Global Security for a beneficial interest in an
equivalent aggregate principal amount of Restricted Securities.
In connection with such request, and in respect of such Senior Notes,
we confirm that:
1. We are either not a U.S. person (as defined below) or we have
purchased our beneficial interest in the above referenced Regulation S
Permanent Global Security in a transaction that is exempt from the
registration requirements under the Securities Act.
2. We are delivering this certificate in connection with obtaining a
beneficial interest in Restricted Securities in exchange for our beneficial
interest in the Regulation S Permanent Global Security.
For purposes of this certificate, "U.S. person" means (i) any
individual resident in the United States, (ii) any partnership or corporation
organized or incorporated under the laws of the United States, (iii) any estate
of which an executor or administrator is a U.S. person (other than an estate
governed by foreign law and of which at least one executor or administrator is a
non-U.S. person who has sole or shared investment discretion with respect to its
assets), (iv) any trust of which any trustee is a U.S. person (other than a
trust of which at least one trustee is a non-U.S. person who has sole or shared
investment discretion with respect to its assets and no beneficiary of the trust
(and no settlor if the trust is revocable) is a U.S. person), (v) any agency or
branch of a foreign entity located in the United States, (vi) any non-
discretionary or similar account (other than an estate or trust) held by a
dealer or other fiduciary for the benefit or account of a U.S. person, (vii) any
discretionary or similar account (other than
106
an estate or trust) held by a dealer or other fiduciary organized, incorporated
or (if an individual) resident in the United States (other than such an account
held for the benefit or account of a non-U.S. person), (viii) any partnership
or corporation organized or incorporated under the laws of a foreign
jurisdiction and formed by a U.S. person principally for the purpose of
investing in securities not registered under the Securities Act (unless it is
organized or incorporated, and owned, by accredited investors within the meaning
of Rule 501(a) under the Securities Act who are not natural persons, estates or
trusts); provided, however, that the term "U.S. person" shall not include (A) a
-------- -------
branch or agency of a U.S. person that is located and operating outside the
United States for valid business purposes as a locally regulated branch or
agency engaged in the banking or insurance business, (B) any employee benefit
plan established and administered in accordance with the law, customary
practices and documentation of a foreign country and (C) the international
organizations set forth in Section 902(o)(7) of Regulation S under the
Securities Act and any other similar international organizations, and their
agencies, affiliates and pension plans.
We irrevocably authorize you to produce this certificate or a copy
hereof to any interested party in any administrative or other proceedings with
respect to the matters covered by this certificate.
Very truly yours,
[TRANSFEROR]
By:___________________________
Name:
Title:
Dated: To be completed by the account
holder as, or as agent for,
the beneficial owner(s) of the
Senior Notes to which this
certificate relates.
cc: International CableTel Incorporated
110 East 59th Street
New York, New York 10022
Attn: Richard J. Lubasch, Esq.
General Counsel
107